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 number 811- 4630

John Hancock Investment Trust III
(Exact name of registrant as specified in charter)

601 Congress Street, Boston, Massachusetts 02210
(Address of principal executive offices) (Zip code)

Alfred P. Ouellette
Senior Attorney and Assistant Secretary

601 Congress Street

Boston, Massachusetts 02210
(Name and address of agent for service)

Registrant's telephone number, including area code: 617-663-4324

Date of fiscal year end:	October 31
Date of reporting period:	October 31, 2006

ITEM 1. REPORT TO SHAREHOLDERS.

CEO corner

TABLE OF CONTENTS 

Your fund at a glance 

page 1 

Manager’s report 

page 2 

A look at performance 

page 6 

Your expenses 

page 8 

Fund’s investments 

page 1 0 

Financial statements 

page 1 4 

Notes to financial 

statements 

page 2 1 

Trustees and officers 

page 3 3 

For more information 

page 40 

To Our Shareholders,

The future has arrived at John Hancock Funds.

We have always been firm believers in the powerful role the Internet can play in providing fund information to our shareholders and prospective investors. Recently, we launched a redesigned, completely overhauled Web site that is more visually pleasing, easier to navigate and, most importantly, provides more fund information and learning tools without overwhelming the user.

Not long after we embarked on this major project, a study was released by the Investment Company Institute, the mutual fund industry’s main trade group, which found that an overwhelming majority of shareholders consider the Internet the “wave of the future” for accessing fund information.

Our new site sports fresher and faster ways to access account information. New innovations allow investors to view funds by risk level, track the performance of the John Hancock funds of their choice or sort funds by Morningstar, Inc.’s star ratings. Investors who own a John Hancock fund through a qualified retirement plan and don’t pay sales charges when making a purchase have the option of sorting by a “Load Waived” Morningstar Rating, thereby creating an apples-to-apples comparison with no-load funds that may also be available in their retirement plan.

The new site also has more educational tools and interactive modules to educate and assist investors with their financial goals, from college savings to retirement planning. A new “I want to…” feature allows investors to check performance, invest more money, update personal information or download prospectuses and forms quickly and easily.

In another of our ongoing efforts to provide our shareholders with top-notch service, we also redesigned our shareholder reports, as you may have noticed with this report. We hope the larger size, more colorful cover and redesigned presentation of the commentary and data tables will draw you in and make them easier to read.

After you’ve read your shareholder report, we encourage you to visit our new Web site — www.jhfunds.com — and take a tour. It’s easy, fast and fun and allows you to be in control of what you see and do. In short, it’s the wave of the future!

Sincerely,

Keith F. Hartstein,
President and Chief Executive Officer

This commentary reflects the CEO’s views as of October 31, 2006. They are subject to change at any time.

Your fund at a glance

The Fund seeks long-term capital appreciation by normally investing at least 80% of its assets in equity securities of companies located in China, Hong Kong or Taiwan.

Over the last twelve months

► In a sharply rising market, the Fund handily beat its peer group but slightly trailed its benchmark index due to strong cash inflows and defensive positioning at the beginning of the period.

► Despite the government’s attempts to moderate growth, the Chinese economy grew faster through the first ten months of 2006 than its torrid 9.8% pace in 2005.

► The yuan appreciated modestly versus the U.S. dollar and the U.S. Treasury Secretary visited Beijing to help stabilize the huge and growing U.S. trade deficit with China.

John Hancock Greater China Opportunities Fund

Fund performance for the year ended October 31, 2006.

Total returns for the Fund are at net asset value with all distributions reinvested. These returns do not reflect the deduction of the maximum sales charge, which would reduce the performance shown above.

Top 10 holdings
China Mobile (Hong Kong) Ltd.	8.6%	China Telecom Corp. Ltd.	2.9%
PetroChina Co., Ltd.	7.9%	HSBC Holdings Plc	2.7%
China Construction Bank	4.2%	Bank of Communications Co., Ltd.	2.4%
China Life Insurance Co., Ltd.	3.6%	Bank of China, Ltd.	1.8%
CNOOC Ltd.	3.4%	CITIC International Financial
		Holdings Ltd.	1.8%
As a percentage of net assets on October 31, 2006.

1

Manager’s report

John Hancock

Greater China Opportunities Fund

Greater China stock markets posted very strong gains during the one-year review period. In large part, these gains were driven by the continued robust growth of the Chinese economy, which expanded by more than 10% during the period despite attempts by the Chinese government to moderate its growth. That was up from the 9.8% rise in GDP, or gross domestic product, for 2005 overall. Among other measures, Chinese officials hiked the nation’s banking reserve requirement and also increased the interbank rate, both by one-half of a percentage point. It was hoped that modestly tighter monetary policy would contain growth without triggering a recession or otherwise creating undue strain on the economy.

One ongoing theme during the period was friction between the United States and China over the latter’s control of its currency, the yuan — also known as the renminbe. For years, the yuan was pegged to the U.S. dollar, resulting in a relatively stable exchange rate. In July 2005, responding to massive inflows of Chinese goods to the United States and a burgeoning stockpile of U.S. dollar reserves in China’s coffers, Beijing pegged the yuan to a basket of currencies and allowed its value to rise modestly versus the U.S. dollar. U.S. officials would like to see further appreciation of the yuan and, in support of that policy, U.S. Treasury Secretary Henry Paulson visited China in September. During the review

SCORECARD

INVESTMENT		PERIOD’S PERFORMANCE... AND WHAT’S BEHIND THE NUMBERS
China National	▲	Acquired at a favorable price
Aviation
Harbin Power	▲	Strong demand for power generation
Equipment
Kasen International	▼	Rising costs, worries about U.S. housing slowdown
Holdings

2

Portfolio Manager, MFC Global Investment Management (U.S.A.) Limited
Pauline Dan, CFA

period, modest appreciation by the yuan, which is contained within a narrow trading band, bolstered the Fund’s gains in U.S. dollar terms.

“Greater China stock markets
posted very strong gains during
the one-year review period.”

Looking at performance

For the 12 months ending October 31, 2006, John Hancock Greater China Opportunities Fund’s Class A, Class B, Class C and Class I shares returned 54.74%, 53.59%, 53.59% and 55.43%, respectively, at net asset value. By comparison, the average Pacific/Asia ex-Japan fund monitored by Morningstar, Inc. returned 40.07%, ¹ while the Morgan Stanley Capital International (MSCI) China Index finished with a 58.94% return. Keep in mind that your returns will differ from those listed above if you were not invested in the Fund for the entire period and did not reinvest all distributions. Historical performance information can be found on pages six and seven.

Industrials and materials bolster performance

The Fund was aided by favorable stock selection in almost all sectors relative to the MSCI index. The two biggest boosts to performance came from industrials and materials. In the former, China National Aviation was an important contributor, as the airline was acquired at a premium price by rival Cathay Pacific. The Fund also benefited from its position in Citic Pacific, Ltd., a holding company that had a stake in China National Aviation and was helped by the buyout of that company. We’ll also mention Harbin Power Equipment Co., Ltd., a maker of power generation turbines. The stock posted a strong gain during the period amid the huge inflows of investment capital aimed at expanding and modernizing China’s electric power infrastructure.

In the materials sector, underweighting steel stocks helped, as they lagged the MSCI index. Additionally, performance was aided by gold mining stock

Greater China Opportunities Fund

3

Lingbao Gold Co., Ltd., Nine Dragons Paper Holdings, a paper producer, and Hunan Nonferrous Metals, a mine primarily producing zinc and other industrial metals. Strong contributors in other sectors included Bank of China, Ltd., in financials and China Yurun Food Group Ltd. in consumer staples.

Although we cannot state this with certainty, the Fund likely finished ahead of its peer group in part because of lower exposure to Taiwanese technology stocks and Hong Kong industrial shares, both of which lagged the MSCI index.

Detractors

The stellar performance of stocks in the region produced strong inflows of investment capital for the Fund, which made it hard to stay fully invested. Additionally, we began the period with a defensive posture while waiting to learn the details of the Chinese government’s latest five-year plan. Although we quickly moved to a more aggressive stance once that news was released, our caution resulted in the Fund’s losing some ground against the advancing MSCI index.

Not having a large enough stake in telecommunication services provider China Mobile Ltd. also worked against the Fund’s performance. While the stock accounted for approximately 17.5% of the MSCI index at the end of the period, for diversification reasons we try to limit our position in any one stock to 10%. That policy penalized the Fund during the period given China Mobile’s exceptionally strong performance. A sizable position in telecom operator China Netcom Group Corp., which was not a benchmark component, was a further drag on performance because the stock’s gain fell considerably short of the benchmark’s return.

Other detractors included Kasen International Holdings Ltd., a furniture manufacturer deriving a significant portion of its revenues from exports to the United States. Rising material costs and investors’ concerns about a slowing U.S. housing market hampered the stock. Both HSBC Holdings Plc and GZI Real Estate Investment Trust were overweighted in the Fund and underperformed the benchmark. We bought HSBC, which is headquartered in London but has its roots in Hong Kong and Shanghai, because its valuation was more attractive compared

SECTOR DISTRIBUTION2
Industrials	27%
Consumer discretionary	17%
Financials	13%
Information technology	12%
Materials	7%
Energy	4%
Utilities	4%
Telecommunication
services	4%
Consumer staples	3%

Greater China Opportunities Fund

4

with most domestic Chinese banks. In GZI’s case, a generous yield was the main attraction.

“The Fund was aided by favorable
stock selection in almost all
sectors relative to the MSCI
index.“

Outlook

Widespread expectations for further appreciation of the yuan, coupled with the potential for continued slowing of the U.S. economy, could present near-term challenges for Chinese companies that sell goods and services to the United States. Accordingly, we anticipate favoring stocks positioned to benefit from the strong growth in China’s domestic spending, especially the consumer discretionary and financial sectors. Within the financial sector, we like not only banks but also companies specializing in insurance and real estate. The high savings rate of Chinese consumers, together with relatively low mortgage rates, the growth of the country’s middle class and a loosening of the restrictions on property ownership have contributed to a strong real estate market and advancing stock prices for real estate stocks. We will be monitoring these and other opportunities in the months ahead. In closing, alt hough we remain confident about the favorable long-term prospects of the Greater China markets, we caution our shareholders not to expect a repeat of the performance achieved during this exceptionally strong period.

This commentary reflects the views of the portfolio manager through the end of the Fund’s period discussed in this report. The manager’s statements reflect her own opinions. As such, they are in no way guarantees of future events, and are not intended to be used as investment advice or recommendation regarding any specific security. They are also subject to change at any time as market and other conditions warrant.

International investing involves special risks such as political, economic and currency risks and differences in accounting standards and financial reporting. Sector investing is subject to greater risks than the market as a whole.

¹ Figures from Morningstar, Inc. include reinvested dividends and do not take into account sales charges. Actual load-adjusted performance is lower.

² As a percentage of net assets on October 31, 2006.

Greater China Opportunities Fund

5

A look at performance

For the periods ending October 31, 2006

		Average annual returns				Cumulative total returns
		with maximum sales charge (POP)				with maximum sales charge (POP)
	Inception				Since				Since
Class	date	1-year	5-year	10-year	inception	1-year	5-year	10-year	inception
A	6-8-05	47.00%	—	—	34.00%	47.00%	—	—	50.53%
B	6-8-05	48.59	—	—	35.46	48.59	—	—	52.81
C	6-8-05	52.59	—	—	37.99	52.59	—	—	56.81
I1	6-8-05	55.43	—	—	39.65	55.43	—	—	59.47

Performance figures assume all distributions are reinvested. Returns with maximum sales charge reflect a sales charge on Class A shares of 5%, and the applicable contingent deferred sales charge (CDSC) on Class B and Class C shares. The Class B shares’ CDSC declines annually between years 1–6 according to the following schedule: 5, 4, 3, 3, 2, 1%. No sales charge will be assessed after the sixth year. Class C shares held for less than one year are subject to a 1% CDSC. Sales charge is not applicable for Class I shares.

The returns reflect past results and should not be considered indicative of future performance. The return and principal value of an investment will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Due to market volatility, the Fund’s current performance may be higher or lower than the performance shown. For performance data current to the most recent month-end, please call 1-800-225-5291 or visit the Fund’s Web site at www.jhfunds.com.

The performance table above and the chart on the next page do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.

The Fund’s performance results reflect any applicable expense reductions, without which the expenses would increase and results would have been less favorable.

¹For certain types of investors as described in the Fund’s Class I share prospectus.

Greater China Opportunities Fund

6

Growth of $10,000

This chart shows what happened to a hypothetical $10,000 investment in Class A shares for the period indicated. For comparison, we’ve shown the same investment in the MSCI China Free Index.

			With maximum
Class	Period beginning	Without sales charge	sales charge	Index
B	6-8-05	$15,681	$15,281	$16,747
C	6-8-05	15,681	15,681	16,747
I1	6-8-05	15,947	15,947	16,747

Assuming all distributions were reinvested for the period indicated, the table above shows the value of a $10,000 investment in the Fund’s Class B, Class C and Class I shares, respectively, as of October 31, 2006. Performance of the classes will vary based on the difference in sales charges paid by shareholders investing in the different classes and the fee structure of those classes.

MSCI China Index is an unmanaged market capitalization-weighted index of Chinese companies available to non-domestic investors.

It is not possible to invest directly in an index. Index figures do not reflect sales charges which would have resulted in lower values if they did.

¹ For certain types of investors as described in the Fund’s Class I share prospectus.

Greater China Opportunities Fund

7

Your expenses

These examples are intended to help you understand your ongoing operating expenses.

Understanding fund expenses

As a shareholder of the Fund, you incur two types of costs:

■ Transaction costs which include sales charges (loads) on purchases or redemptions (varies by share class), minimum account fee charge, etc.

■ Ongoing operating expenses including management fees, distribution and service fees (if applicable) and other fund expenses.

We are going to present only your ongoing operating expenses here.

Actual expenses/actual returns

This example is intended to provide information about your fund’s actual ongoing operating expenses, and is based on your fund’s actual return. It assumes an account value of $1,000.00 on May 1, 2006, with the same investment held until October 31, 2006.

	Account value	Ending value	Expenses paid during period
	on 5-1-06	on 10-31-06	ended 10-31-061
Class A	$1,000.00	$1,122.50	$9.87
Class B	1,000.00	1,117.20	13.66
Class C	1,000.00	1,118.00	13.66
Class I	1,000.00	1,124.10	7.80

Together with the value of your account, you may use this information to estimate the operating expenses that you paid over the period. Simply divide your account value at October 31, 2006 by $1,000.00, then multiply it by the “expenses paid” for your share class from the table above. For example, for an account value of $8,600.00, the operating expenses should be calculated as follows:

Greater China Opportunities Fund

8

Hypothetical example for comparison purposes

This table allows you to compare your fund’s ongoing operating expenses with those of any other fund. It provides an example of the Fund’s hypothetical account values and hypothetical expenses based on each class’s actual expense ratio and an assumed 5% annual return before expenses (which is not your fund’s actual return). It assumes an account value of $1,000.00 on May 1, 2006, with the same investment held until October 31, 2006. Look in any other fund shareholder report to find its hypothetical example and you will be able to compare these expenses.

	Account value	Ending value	Expenses paid during period
	on 5-1-06	on 10-31-06	ended 10-31-061
Class A	$1,000.00	$1,015.90	$9.37
Class B	1,000.00	1,012.30	12.98
Class C	1,000.00	1,012.30	12.98
Class I	1,000.00	1,017.87	7.41

Remember, these examples do not include any transaction costs, such as sales charges; therefore, these examples will not help you to determine the relative total costs of owning different funds. If transaction costs were included, your expenses would have been higher. See the prospectus for details regarding transaction costs.

¹ Expenses are equal to the Fund’s annualized expense ratio of 1.85%, 2.56%, 2.56% and 1.46% for Class A, Class B, Class C and Class I, respectively, multiplied by the average account value over the period, multiplied by number of days in most recent fiscal half-year/365 or 366 (to reflect the one-half year period).

Greater China Opportunities Fund

9

Fund’s investments

F I N A N C I A L  S T A T E M E N T S

Securities owned by the Fund on 10-31-06

This schedule consists of one main category: common stocks. Common stocks are further broken down by industry group.

Issuer	Shares	Value
Common stocks 90.38%		$101,265,285
(Cost $86,847,559)
Air Freight & Logistics 0.64%		717,972
Sinotrans Ltd. (China)	2,100,000	717,972
Airlines 1.31%		1,462,678
Air China Ltd. (China)	1,600,000	802,031
China Southern Airlines Co., Ltd. (China) (I)	2,000,000	660,647
Airport Services 0.52%		582,361
Beijing Capital International Airport Co. Ltd. (China)	908,000	582,361
Aluminum 0.27%		295,919
Aluminum Corp. of China Ltd. (China)	424,000	295,919
Apparel, Accessories & Luxury Goods 0.73%		819,254
China Ting Group Holdings Ltd. (Hong Kong)	2,180,000	504,354
Glorious Sun Enterprises Ltd. (Hong Kong)	700,000	314,900
Application Software 0.34%		380,772
Kingdee International Software Group Co., Ltd. (China)	750,000	380,772
Asset Management & Custody Banks 1.38%		1,549,080
iShares MSCI Taiwan Index Fund (Taiwan)	117,000	1,549,080
Auto Parts & Equipment 0.15%		165,085
Zhejiang Shibao Co., Ltd. (China) (I)	1,690,000	165,085
Automobile Manufacturers 1.63%		1,825,649
Denway Motors Ltd. (Hong Kong)	4,550,000	1,684,265
Geely Automobile Holdings Ltd. (Hong Kong)	1,250,000	141,384
Coal & Consumable Fuels 1.00%		1,125,311
China Shenhua Energy Co., Ltd. (China)	640,000	1,125,311
Computer Storage & Peripherals 0.88%		986,269
TPV Technology Ltd. (Hong Kong)	1,186,000	986,269
Construction & Engineering 1.04%		1,168,086
COSCO International Holdings Ltd. (Hong Kong)	3,200,000	1,168,086
Construction Materials 0.60%		667,074
Anhui Conch Cement Co., Ltd. (China)	300,000	667,074

See notes to financial statements

Greater China Opportunities Fund

10

F I N A N C I A L   S T A T E M E N T S

Issuer	Shares	Value
Consumer Electronics 0.48%		$542,240
Fujikon Industrial Holdings Ltd. (Hong Kong)	2,318,000	542,240
Department Stores 1.30%		1,453,038
Parkson Retail Group Ltd. (China)	350,000	1,453,038
Distributors 1.20%		1,343,350
China Resources Enterprise Ltd. (Hong Kong)	580,000	1,343,350
Diversified Banks 15.45%		17,309,278
Bank of China Ltd. (China) (I)	4,622,000	1,990,129
Bank of Communications Co., Ltd. (China)	3,510,000	2,634,671
Bank of East Asia Ltd. (Hong Kong)	341,400	1,630,155
China Construction Bank (China) (S)	10,510,000	4,727,997
CITIC International Financial Holdings Ltd. (Hong Kong)	2,940,000	1,972,533
HSBC Holdings Plc (Hong Kong)	162,000	3,056,663
Industrial and Commercial Bank of China (China) (I)	2,900,000	1,297,130
Diversified Metals & Mining 0.08%		88,285
China Rare Earth Holdings Ltd. (China)	424,000	88,285
Diversified REIT’s 1.14%		1,279,805
GZI Real Estate Investment Trust (Hong Kong)	3,212,000	1,279,805
Electronic Equipment Manufacturers 2.80%		3,137,778
Au Optronics Corp., American Depositary Receipt (Taiwan)	51,500	699,370
GST Holdings Ltd. (Hong Kong)	1,300,000	501,269
Kingboard Chemical Holdings Ltd. (Hong Kong)	342,000	1,215,424
Yorkey Optical International Cayman Ltd. (Hong Kong)	2,072,000	721,715
Fertilizers & Agricultural Chemicals 0.21%		236,856
Sinochem Hong Kong Holdings Ltd. (Hong Kong)	680,000	236,856
Footwear 0.31%		352,611
Prime Success International Group Ltd. (Hong Kong)	430,000	352,611
Forest Products 0.42%		472,166
Sino-Forest Corp. (Canada) (I)	90,900	472,166
Gas Utilities 2.12%		2,377,880
Hong Kong & China Gas Co., Ltd. (Hong Kong)	375,000	858,905
Xinao Gas Holdings Ltd. (China)	600,000	603,837
Zhengzhou Gas Co., Ltd. (China)	8,000,000	915,138
Gold 0.43%		480,704
Lingbao Gold Co., Ltd. (Hong Kong)	550,000	480,704
Health Care Supplies 0.21%		235,797
Shandong Weigao Group Medical Polymer Co., Ltd. (China)	312,000	235,797
Heavy Electrical Equipment 0.54%		609,749
Harbin Power Equipment Co., Ltd. (China)	340,000	292,793
Shanghai Electric Group Co., Ltd. (China)	900,000	316,956

See notes to financial statements

Greater China Opportunities Fund

11

F I N A N C I A L  S T A T E M E N T S

Issuer	Shares	Value
Highways & Railtracks 1.61%		$1,807,574
Anhui Expressway Co., Ltd. (China)	990,000	673,127
Zhejiang Expressway Co., Ltd. (China)	1,678,000	1,134,447
Home Furnishings 0.42%		470,325
Kasen International Holdings Ltd. (China)	2,975,000	470,325
Hotels, Resorts & Cruise Lines 0.17%		191,412
Home Inns & Hotels Management, Inc. ADR (China) (I)	7,800	191,412
Hypermarkets & Super Centers 0.86%		958,761
Lianhua Supermarket Holdings Co., Ltd. (China)	755,000	958,761
Independent Power Producers & Energy Traders 3.10%		3,474,912
China Resources Power Holdings Co., Ltd. (Hong Kong)	1,220,000	1,521,031
Huaneng Power International, Inc. (China)	2,488,000	1,953,881
Industrial Conglomerates 1.86%		2,082,838
Beijing Enterprises Holdings Ltd. (Hong Kong)	380,000	761,929
CITIC Pacific Ltd. (Hong Kong)	430,000	1,320,909
Industrial Machinery 1.33%		1,485,248
Enric Energy Equipment Holdings Ltd. (Hong Kong) (I)	764,000	481,167
Shanghai Prime Machinery Co., Ltd. (China) (I)	3,100,000	1,004,081
Integrated Oil & Gas 9.65%		10,814,588
China Petroleum & Chemical Corp. (China)	2,790,000	1,936,442
PetroChina Co., Ltd. (China)	8,060,000	8,878,146
Integrated Telecommunication Services 3.87%		4,331,547
China Netcom Group Corp. (Hong Kong) Ltd. (Hong Kong)	597,000	1,060,447
China Telecom Corp. Ltd. (China)	8,686,000	3,271,100
IT Consulting & Other Services 0.47%		529,494
Chinasoft International Ltd. (China)	1,730,000	293,512
SinoCom Software Group Ltd. (Hong Kong)	1,200,000	235,982
Life & Health Insurance 3.60%		4,031,708
China Life Insurance Co., Ltd. (China)	1,915,000	4,031,708
Marine 0.80%		898,917
China COSCO Holdings Co., Ltd. (China)	400,000	186,112
China Shipping Development Co., Ltd. (China)	230,000	250,095
Pacific Basin Shipping Ltd. (Hong Kong)	720,000	462,710
Marine Ports & Services 2.43%		2,726,326
China Merchants Holdings International Co., Ltd. (Hong Kong)	650,000	1,900,646
COSCO Pacific Ltd. (Hong Kong)	400,000	825,680
Office REITs 1.35%		1,513,190
Champion Real Estate Investment Trust (Hong Kong) (I)	3,050,000	1,513,190
Oil & Gas Drilling 0.70%		780,733
China Oilfield Services Ltd. (China)	1,390,000	780,733

See notes to financial statements

Greater China Opportunities Fund

12

F I N A N C I A L   S T A T E M E N T S

Issuer	Shares	Value
Oil & Gas Exploration & Production 3.38%		$3,781,814
CNOOC Ltd. (Hong Kong)	4,499,000	3,781,814
Packaged Foods & Meats 0.60%		677,356
China Yurun Food Group Ltd. (Hong Kong)	775,000	677,356
Personal Products 0.74%		826,092
China Flavors & Fragrances Co., Ltd. (Hong Kong) (I)	2,060,000	826,092
Railroads 0.80%		892,861
Guangshen Railway Co., Ltd. (China)	1,898,000	892,861
Real Estate Management & Development 3.35%		3,750,401
China Overseas Land & Investment Ltd. (Hong Kong)	1,000,000	911,282
China Resources Land Ltd. (Hong Kong)	1,270,000	1,013,682
Guangzhou Investment Co., Ltd. (Hong Kong)	4,560,000	879,149
Shenzhen Investment Ltd. (Hong Kong)	2,406,000	946,288
Semiconductors 0.44%		495,645
Advanced Semiconductor Manufacturing Corp. (China) (I)	3,268,000	495,645
Technology Distributors 1.36%		1,525,333
Digital China Holdings Ltd. (Hong Kong)	3,662,800	1,525,333
Wireless Telecommunication Services 10.31%		11,553,163
China Mobile (Hong Kong) Ltd. (Hong Kong)	1,180,000	9,585,296
China Unicom Ltd. (Hong Kong)	1,770,000	1,967,867
Total investments (cost $86,847,559) 90.38%		$101,265,285
Other assets and liabilities, net 9.62%		$10,774,458
Total net assets 100.00%		$112,039,743

(I) Non-income producing security.

(S) This security is exempt from registration under Rule 144A of the Securities Act of 1933. Such security [securities] may be resold, normally to qualified institutional buyers, in transactions exempt from registration. Rule 144A securities amounted to $4,727,997 or 4.22% of the Fund’s net assets as of October 31, 2006.

Parenthetical disclosure of a foreign country in the security description represents country of a foreign issuer.

The percentage shown for each investment category is the total value of that category as a percentage of the net assets of the Fund.

See notes to financial statements

Greater China Opportunities Fund

13

Financial statements

F I N A N C I A L  S T A T E M E N T S

Statement of assets and liabilities 10-31-06

This Statement of Assets and Liabilities is the Fund’s balance sheet. It shows the value of what the Fund owns, is due and owes. You’ll also find the net asset value and the maximum offering price per share.

Assets
Investments at value (cost $86,847,559)	$101,265,285
Cash	3,147,714
Foreign cash, at value (cost $5,587,117)	5,577,584
Receivable for investments sold	119,207
Receivable for shares sold	2,760,793
Dividends and interest receivable	113,555
Receivable from affiliates	13,111
Total assets	112,997,249
Liabilities
Payable for investments purchased	535,258
Payable for shares repurchased	243,455
Payable to affiliates
Management fees	87,608
Distribution and service fees	7,039
Other payables and accrued expenses	84,146
Total liabilities	957,506
Net assets
Capital paid-in	94,305,701
Accumulated net realized gain on investments and foreign currency transactions	2,818,415
Net unrealized appreciation of investments and translation of assets and
liabilities in foreign currencies	14,416,020
Accumulated net investment income	499,607
Net assets	$112,039,743
Net asset value per share
Based on net asset values and shares outstanding — the Fund has an
unlimited number of shares authorized with no par value
Class A ($79,053,650 ÷ 5,010,763 shares)	$15.78
Class B ($16,479,364 ÷ 1,054,011 shares)	$15.63
Class C ($12,759,979 ÷ 816,225 shares)	$15.63
Class I ($3,746,750 ÷ 236,866 shares)	$15.82
Maximum offering price per share
Class A1 ($15.78 ÷ 95%)	$16.61

¹ On single retail sales of less than $50,000. On sales of $50,000 or more and on group sales the offering price is reduced.

See notes to financial statements

Greater China Opportunities Fund

14

F I N A N C I A L   S T A T E M E N T S

Statement of operations For the year ended 10-31-06.

This Statement of Operations summarizes the Fund’s investment income earned and expenses incurred in operating the Fund. It also shows net gains (losses) for the period stated.

Investment income
Dividends (net of foreign withholding taxes of $620)	$1,546,030
Interest	28,300
Total investment income	1,574,330
Expenses
Investment management fees (Note 2)	513,012
Distribution and service fees (Note 2)	239,014
Class A, B and C transfer agent fees (Note 2)	107,551
Class I transfer agent fees (Note 2)	359
Accounting and legal services fees (Note 2)	8,361
Compliance fees	771
Blue sky fees	63,771
Custodian fees	59,686
Professional fees	23,249
Printing fees	23,060
Trustees’ fees	1,538
Miscellaneous	29,313
Total expenses	1,069,685
Less expense reductions (Note 2)	(16,462)
Net expenses	1,053,223
Net investment income	521,107
Net realized and unrealized gain (loss)
Net realized gain (loss) on
Investments	2,844,859
Foreign currency transactions	(22,417)
Change in net unrealized appreciation (depreciation) of
Investments	14,785,790
Translation of assets and liabilities in foreign currencies	(936)
Net realized and unrealized gain	17,607,296
Increase in net assets from operations	$18,128,403

See notes to financial statements

Greater China Opportunities Fund

15

F I N A N C I A L  S T A T E M E N T S

Statement of changes in net assets

These Statements of Changes in Net Assets show how the value of the Fund’s net assets has changed during the last two periods. The difference reflects earnings less expenses, any investment gains and losses, distributions, if any, paid to shareholders and the net of Fund share transactions.

	Year	Year
	ended	ended
	10-31-051	10-31-06
Increase (decrease) in net assets
From operations
Net investment income	$26,526	$521,107
Net realized gain	38,512	2,822,442
Change in net unrealized appreciation (depreciation)	(368,834)	14,784,854
Increase (decrease) in net assets resulting from operations	(303,796)	18,128,403
Distributions to shareholders
From net investment income
Class A	—	(34,481)
Class B	—	0
Class C	—	0
Class I	—	(4,277)
From net realized gain
Class A	—	(44,190)
Class B	—	(5,067)
Class C	—	(4,308)
Class I	—	(351)
	—	(92,674)
From Fund share transactions	15,402,390	78,905,420
Net assets
Beginning of period	—	15,098,594
End of period2	$15,098,594	$112,039,743

¹ Beginning of operations from 6-9-05 through 10-31-05.

² Includes accumulated net invesment income of $36,877 and $499,607, respectively.

See notes to financial statements

Greater China Opportunities Fund

16

F I N A N C I A L   S T A T E M E N T S

Financial highlights

The Financial highlights show how the Fund’s net asset value for a share has changed since the end of the previous period.

CLASS A SHARES
Period ended	10-31-051	10-31-06
Per share operating performance
Net asset value, beginning of period	$10.00	$10.24
Net investment income (loss)2	0.03	0.16
Net realized and unrealized
gain on investments	0.21	5.43
Total from investment operations	0.24	5.59
Less distributions
From net investment income	—	(0.01)
From net realized gain	—	(0.04)
		(0.05)
Net asset value, end of period	$10.24	$15.78
Total return3,4 (%)	2.40 5	54.74
Ratios and supplemental data
Net assets, end of period
(in millions)	$12	$79
Ratio of net expenses to average
net assets (%)	1.936	1.89
Ratio of gross expenses to average
net assets7 (%)	4.446	1.92
Ratio of net investment income
(loss) to average net assets	0.686	1.14
Portfolio turnover (%)	28	57

See notes to financial statements

Greater China Opportunities Fund

17

F I N A N C I A L  S T A T E M E N T S

Financial highlights

CLASS B SHARES
Period ended	10-31-051	10-31-06
Per share operating performance
Net asset value, beginning of period	$10.00	$10.21
Net investment income (loss)2	0.02	0.09
Net realized and unrealized
gain on investments	0.19	5.37
Total from investment operations	0.21	5.46
Less distributions
From net realized gain	—	(0.04)
Net asset value, end of period	$10.21	$15.63
Total return3,4 (%)	2.10 5	53.59
Ratios and supplemental data
Net assets, end of period
(in millions)	$1	$16
Ratio of net expenses to average
net assets (%)	2.636	2.59
Ratio of gross expenses to average
net assets7 (%)	5.146	2.62
Ratio of net investment income
(loss) to average net assets	0.436	0.63
Portfolio turnover (%)	28	57

See notes to financial statements

Greater China Opportunities Fund

18

F I N A N C I A L   S T A T E M E N T S

Financial highlights

CLASS C SHARES
Period ended	10-31-051	10-31-06
Per share operating performance
Net asset value, beginning of period	$10.00	$10.21
Net investment income (loss)2	0.03	0.08
Net realized and unrealized
gain on investments	0.18	5.38
Total from investment operations	0.21	5.46
Less distributions
From net realized gain	—	(0.04)
Net asset value, end of period	$10.21	$15.63
Total return3,4 (%)	2.10 5	53.59
Ratios and supplemental data
Net assets, end of period
(in millions)	$1	$13
Ratio of net expenses to average
net assets (%)	2.626	2.59
Ratio of gross expenses to average
net assets7 (%)	5.136	2.62
Ratio of net investment income
(loss) to average net assets	0.616	0.55
Portfolio turnover (%)	28	57

See notes to financial statements

Greater China Opportunities Fund

19

F I N A N C I A L  S T A T E M E N T S

Financial highlights

CLASS I SHARES
Period ended	10-31-051	10-31-06
Per share operating performance
Net asset value, beginning of period	$10.00	$10.26
Net investment income2	0.03	0.24
Net realized and unrealized
gain on investments	0.23	5.42
Total from investment operations	0.26	5.66
Less distributions
From net investment income	—	(0.06)
From net realized gain	—	(0.04)
		(0.10)
Net asset value, end of period	$10.26	$15.82
Total return3,4 (%)	2.605	55.43
Ratios and supplemental data
Net assets, end of period
(in millions)	—8	$4
Ratio of net expenses to average
net assets (%)	1.456	1.46
Ratio of gross expenses to average
net assets7 (%)	3.966	1.49
Ratio of net investment income
to average net assets	0.766	1.70
Portfolio turnover (%)	28	57

¹ Beginning of operations on 6-9-05 through 10-31-05.

² Based on the average of the shares outstanding.

³ Assumes dividend reinvestment and does not reflect the effect of sales charges.

⁴ Total return would have been lower had certain expenses not been reduced during the periods shown.

⁵ Not annualized.

⁶ Annualized.

⁷ Does not take into consideration expense reductions during the periods shown.

⁸ Less than $500,000.

See notes to financial statements

Greater China Opportunities Fund

20

Notes to financial statements

Note 1 Accounting policies

John Hancock Greater China Opportunities (the “Fund”) is a non-diversified series of John Hancock Investment Trust III (the “Trust”), an open-end management investment company registered under the Investment Company Act of 1940 (the “1940 Act”), as amended. The investment objective of the Fund is to achieve long-term capital appreciation.

The Trustees have authorized the issuance of multiple classes of shares of the Fund, designated as Class A, Class B, Class C and Class I shares. The shares of each class represent an interest in the same portfolio of investments of the Fund and have equal rights as to voting, redemptions, dividends and liquidation, except that certain expenses, subject to the approval of the Trustees, may be applied differently to each class of shares in accordance with current regulations of the Securities and Exchange Commission and the Internal Revenue Service. Shareholders of a class that bears distribution and service expenses under the terms of a distribution plan have exclusive voting rights to that distribution plan. Class B shares will convert to Class A shares eight years after purchase.

Significant accounting policies of the Fund are as follows:

Valuation of investments

Securities in the Fund’s portfolio are valued on the basis of market quotations, valuations provided by independent pricing services or, if quotations are not readily available, or the value has been materially affected by events occurring after the close of a foreign market, at fair value as determined in good faith in accordance with procedures approved by the Trustees. Short-term debt investments which have a remaining maturity of 60 days or less may be valued at amortized cost, which approximates market value. All portfolio transactions initially expressed in terms of foreign currencies have been translated into U.S. dollars as described in “Foreign currency translation” below.

Joint repurchase agreement

Pursuant to an exemptive order issued by the Securities and Exchange Commission, the Fund, along with other registered investment companies having a management contract with John Hancock Advisers, LLC (the “Adviser”), a wholly owned subsidiary of John Hancock Financial Services, Inc., a subsidiary of Manulife Financial Corporation (“MFC”), may participate in a joint repurchase agreement transaction. Aggregate cash balances are invested in one or more large repurchase agreements, whose underlying securities are obligations of the U.S. government and/or its agencies. The Fund’s custodian bank receives delivery of the underlying securities for the joint account on the Fund’s behalf. The Adviser is responsible for ensuring that the agreement is fully collateralized at all times.

Foreign currency translation

All assets or liabilities initially expressed in terms of foreign currencies are translated into U.S. dollars based on London currency exchange quotations as of 4:00 P.M., London time, on the date of any determination of the net asset value of the Fund. Transactions affecting statement of operations accounts and net realized gain (loss) on investments are translated at the rates prevailing at the dates of the transactions.

The Fund does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from the fluctuations arising from changes in market prices of securities held. Such fluctuations are included with the net realized and unrealized gain or loss from investments.

Greater China Opportunities Fund

21

Reported net realized foreign currency exchange gains or losses arise from sales of foreign currency, currency gains or losses realized between the trade and settlement dates on securities transactions, and the difference between the amounts of dividends, interest and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign currency exchange gains and losses arise from changes in the value of assets and liabilities, other than investments in securities, resulting from changes in the exchange rates.

Investment transactions

Investment transactions are accounted for on a trade date plus one basis for daily net asset value calculations. However, for financial reporting purposes, investment transactions are reported on trade date. Net realized gains and losses on sales of investments are determined on the identified cost basis. Capital gains realized on some foreign securities are subject to foreign taxes, which are accrued as applicable.

Class allocations

Income, common expenses and realized and unrealized gains (losses) are determined at the fund level and allocated daily to each class of shares based on the appropriate net asset value of the respective classes. Distribution and service fees, if any, and transfer agent fees for Class I shares, are calculated daily at the class level based on the appropriate net asset value of each class and the specific expense rate(s) applicable to each class.

Expenses

The majority of expenses are directly identifiable to an individual fund. Expenses that are not readily identifiable to a specific fund are allocated in such a manner as deemed equitable, taking into consideration, among other things, the nature and type of expense and the relative size of the funds.

Bank borrowings

The Fund is permitted to have bank borrowings for temporary or emergency purposes, including the meeting of redemption requests that otherwise might require the untimely disposition of securities. The Fund has entered into a syndicated line of credit agreement with various banks. This agreement enables the Fund to participate, with other funds managed by the Adviser, in an unsecured line of credit with banks, which permits borrowings of up to $150 million, collectively. Interest is charged to each fund based on its borrowing. In addition, a commitment fee is charged to each fund based on the average daily unused portion of the line of credit, and is allocated among the participating funds. The Fund had no borrowing activity under the line of credit during the year ended October 31, 2006.

Forward foreign currency exchange contracts

The Fund may enter into forward foreign currency exchange contracts as a hedge against the effect of fluctuations in currency exchange rates. A forward foreign currency exchange contract involves an obligation to purchase or sell a specific currency at a future date at a set price. The aggregate principal amounts of the contracts are marked to market daily at the applicable foreign currency exchange rates. Any resulting unrealized gains and losses are included in the determination of the Fund’s daily net asset value. The Fund records realized gains and losses at the time the forward foreign currency exchange contracts are closed out. Risks may arise upon entering these contracts from the potential inability of counterparties to meet the terms of the contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. These contracts involve market or credit risk in excess of the unrealized gain or loss reflected in the Fund’ ;s Statement of Assets and Liabilities.

The Fund may also purchase and sell forward contracts to facilitate the settlement of foreign currency denominated portfolio transactions, under which it intends to take delivery of the foreign currency. Such contracts normally involve no market risk if they are offset by the currency amount of the underlying transactions.

The Fund had no open forward foreign currency exchange contracts on October 31, 2006.

Greater China Opportunities Fund

22

Federal income taxes

The Fund qualifies as a “regulated investment company” by complying with the applicable provisions of the Internal Revenue Code and will not be subject to federal income tax on taxable income that is distributed to shareholders. Therefore, no federal income tax provision is required.

New accounting pronouncements

In June 2006, Financial Accounting Standards Board (“FASB”) Interpretation No. 48, Accounting for Uncertainty in Income Taxes (the “Interpretation”) was issued, and is effective for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. The Interpretation prescribes a minimum threshold for financial statement recognition of the benefit of a tax position taken or expected to be taken in a tax return and requires certain expanded disclosures. Management is currently evaluating the application of the Interpretation to the Fund and has not at this time quantified the impact, if any, resulting from the adoption of the Interpretation on the Fund’s financial statements.

In September 2006, FASB Standard No. 157, Fair Value Measurements (“FAS 157”) was issued, and is effective for fiscal years beginning after November 15, 2007. FAS 157 defines fair value, establishing a framework for measuring fair value and expands disclosure about fair value measurements. Management is currently evaluating the application of FAS 157 to the Fund and its impact, if any, resulting from the adoption of FAS 157 on the Fund’s financial statements.

Dividends, interest and distributions

Dividend income on investment securities is recorded on the ex-dividend date or, in the case of some foreign securities, on the date thereafter when the Fund identifies the dividend. Interest income on investment securities is recorded on the accrual basis. Foreign income may be subject to foreign withholding taxes, which are accrued as applicable.

The Fund records distributions to shareholders from net investment income and net realized gains, if any, on the ex-dividend date. There were no distributions during the year ended October 31, 2005. During the year ended October 31, 2006, the tax character of distributions paid was as follows: ordinary income $92,674. Distributions paid by the Fund with respect to each class of shares are calculated in the same manner, at the same time and are in the same amount, except for the effect of expenses that may be applied differently to each class.

As of October 31, 2006, the components of distributable earnings on a tax basis included $3,404,387 of undistributed ordinary income.

Such distributions and distributable earnings, on a tax basis, are determined in conformity with income tax regulations, which may differ from accounting principles generally accepted in the United States of America. Distributions in excess of tax basis earnings and profits, if any, are reported in the Fund’s financial statements as a return of capital.

Use of estimates

The preparation of these financial statements, in accordance with accounting principles generally accepted in the United States of America, incorporates estimates made by management in determining the reported amount of assets, liabilities, revenues and expenses of the Fund. Actual results could differ from these estimates.

Note 2

Management fee and transactions with affiliates and others

The Fund has an investment management contract with the Adviser. Under the investment management contract, the Fund pays a daily management fee to the Adviser equivalent, at an annual rate of 1.00% of the Fund’s average daily net asset value. The Fund has a sudadvisory agreement with MFC Global Investment Management (U.S), LLC., an affiliate of John Hancock Financial Services, Inc. The Fund is not responsible for payment of the subadvisory fees.

Effective December 31, 2005, the investment management teams of the Adviser were reorganized into Sovereign Asset Management LLC (“Sovereign”), a wholly owned indirect subsidiary of John Hancock Life Insurance Company (“JHLICO”), a subsidiary of MFC. The Adviser remains the principal advisor on

Greater China Opportunities Fund

23

the Fund and Sovereign acts as subadviser under the supervision of the Adviser. The restructuring did not have an impact on the Fund, which continues to be managed using the same investment philosophy and process. The Fund is not responsible for payment of the subadvisory fees.

Effective October 1, 2006, Sovereign changed its name to MFC Global Investment Management (U.S.), LLC.

The Adviser has agreed to limit the Fund’s expenses, excluding distribution and service fees and transfer agent fees to 1.40% on an annual basis of the Fund’s average daily net asset value with respect to Class A, Class B and Class C shares and net operating expenses of Class A, Class B, Class C and Class I shares to 2.10%, 2.80%, 2.80% and 1.45% of each respective class’ average daily net asset value at least until February 28, 2007. Accordingly, the expense reductions related to this total expense limitation amounted to $16,462 for the year ended October 31, 2006. The Adviser reserves the right to terminate these limitations in the future.

The Fund has a Distribution Agreement with John Hancock Funds, LLC (“JH Funds”), a wholly owned subsidiary of the Adviser. The Fund has adopted Distribution Plans with respect to Class A, Class B and Class C, pursuant to Rule 12b-1 under the 1940 Act, as amended, to reimburse JH Funds for the services it provides as distributor of shares of the Fund. Accordingly, the Fund makes monthly payments to JH Funds at an annual rate not to exceed 0.30%, 1.00% and 1.00% of average daily net asset value of Class A, Class B and Class C, respectively. A maximum of 0.25% of such payments may be service fees, as defined by the Conduct Rules of the National Association of Securities Dealers. Under the Conduct Rules, curtailment of a portion of the Fund’s 12b-1 payments could occur under certain circumstances.

Expenses under the agreements described above for the period ended October 31, 2006 were as follows:

	Distribution and
Share class	service fees
Class A	$114,347
Class B	72,690
Class C	51,977
Total	$239,014

Class A shares are assessed up-front sales charges. During the year ended October 31, 2006, JH Funds received net up-front sales charges of $822,658 with regard to sales of Class A shares. Of this amount, $131,308 was retained and used for printing prospectuses, advertising, sales literature and other purposes, $685,619 was paid as sales commissions to unrelated broker-dealers and $5,731 was paid as sales commissions to sales personnel of Signator Investors, Inc. (“Signator Investors”), a related broker-dealer. The Adviser’s indirect parent JHLICO, a subsidiary of MFC, is the indirect sole shareholder of Signator Investors.

Class B shares that are redeemed within six years of purchase are subject to a contingent deferred sales charge (“CDSC”) at declining rates, beginning at 5.00% of the lesser of the current market value at the time of redemption or the original purchase cost of the shares being redeemed. Class C shares that are redeemed within one year of purchase are subject to a CDSC at a rate of 1.00% of the lesser of the current market value at the time of redemption or the original purchase cost of the shares being redeemed. Proceeds from the CDSCs are paid to JH Funds and are used, in whole or in part, to defray its expenses for providing distribution-related services to the Fund in connection with the sale of Class B and Class C shares. During the year ended October 31, 2006, CDSCs received by JH Funds amounted to $8,876 for Class B shares and $2,252 for Class C shares.

The Fund has a transfer agent agreement with John Hancock Signature Services, Inc. (“Signature Services”), an indirect subsidiary of JHLICO. For Class A, Class B and Class C shares, the Fund pays a monthly transfer

Greater China Opportunities Fund

24

agent fee at an annual rate of 0.05% of each class’ average daily net asset value, plus a fee based on the number of shareholder accounts and reimbursement for certain out-of-pocket expenses, aggregated and allocated to each class on the basis of its relative net asset value. For Class I shares the Fund pays a monthly transfer agent fee at a total annual rate of 0.05% of Class I average daily net asset value. Signature Services has agreed to limit transfer agent fees on Class A, Class B and Class C shares to 0.40% of each class’s average daily net asset value, at least until February 28, 2007. Signature Services agreed to voluntarily reduce the Fund’s asset-based portion of the transfer agent fee for Class A, Class B and Class C shares if the total transfer agent fee exceeded the median transfer agency fee for comparable mutual funds by greater than 0.05% . There were no transfer agent fee reductions during the year ended October 31, 2006. Signature Servic es reserves the right to terminate this reimbursement limitation at any time.

The Fund has an agreement with the Adviser to perform necessary tax, accounting and legal services for the Fund. The compensation for the period amounted to $8,361. The Fund also paid the Adviser the amount of $759 for certain publishing services, included in the printing fees. The Fund reimbursed JHLICO for certain compliance costs, included in the Fund’s Statement of Operations.

The Adviser and other subsidiaries of JHLICO owned 470,000 Class A, 10,000 Class B, 10,000 Class C and 10,000 Class I shares of beneficial interest of the Fund on October 31, 2006.

Mr. James R. Boyle is Chairman of the Adviser, as well as affiliated Trustee of the Fund, and is compensated by the Adviser and/or its affiliates. The compensation of unaffiliated Trustees is borne by the Fund. The unaffiliated Trustees may elect to defer, for tax purposes, their receipt of this compensation under the John Hancock Group of Funds Deferred Compensation Plan. The Fund makes investments into other John Hancock funds, as applicable, to cover its liability for the deferred compensation. Investments to cover the Fund’s deferred compensation liability are recorded on the Fund’s books as an other asset. The deferred compensation liability and the related other asset are always equal and are marked to market on a periodic basis to reflect any income earned by the investments, as well as any unrealized gains or losses. The Deferred Compensation Plan investments had no impact on the operations of the Fund.

Greater China Opportunities Fund

25

Note 3

Fund share transactions

This listing illustrates the number of Fund shares sold, reinvested and repurchased during the last two periods, along with the corresponding dollar value.

	Year ended 10-31-051		Year ended 10-31-06
	Shares	Amount	Shares	Amount
Class A shares
Sold	1,235,094	$12,852,805	4,403,727	$61,366,745
Distributions reinvested	—	—	4,465	52,705
Repurchased	(19,657)	(208,796)	(612,866)	(8,460,937)
Net increase	1,215,437	$12,644,009	3,795,326	$52,958,513
Class B shares
Sold	140,806	$1,500,503	1,005,055	$13,949,422
Distributions reinvested	—	—	424	4,524
Repurchased	(7,545)	(79,732)	(84,729)	(1,165,271)
Net increase	133,261	$1,420,771	920,750	$12,788,675
Class C shares
Sold	116,695	$1,239,980	752,789	$10,545,210
Distributions reinvested	—	—	284	3,039
Repurchased	(212)	(2,370)	(53,331)	(722,035)
Net increase	116,483	$1,237,610	699,742	$9,826,214
Class I shares
Sold	10,000	$100,000	233,955	$3,432,104
Distributions reinvested	—	—	274	3,562
Repurchased	—	—	(7,363)	(103,648)
Net increase	10,000	$100,000	226,866	$3,332,018
Net increase	1,475,181	$15,402,390	5,642,684	$78,905,420

¹ Beginning of operation from 6-9-05 through 10-31-05.

Note 4

Investment transactions

Purchases and proceeds from sales or maturities of securities, other than short-term securities and obligations of the U.S. government, during the year ended October 31, 2006, aggregated $97,479,697 and $26,662,326, respectively.

The cost of investments owned on October 31, 2006, including short-term investments, for federal income tax purposes was $86,933,924. Gross unrealized appreciation and depreciation of investments aggregated $15,470,381 and $1,139,020, respectively, resulting in net unrealized appreciation of $14,331,361. The difference between book basis and tax basis net unrealized appreciation of investments is attributable primarily to the tax deferral of losses on certain sales of securities.

Note 5

Reclassification of accounts

During the year ended October 31, 2006, the Fund reclassified amounts to reflect an increase in accumulated net realized gain on investments of $14,884, a decrease in accumulated net investment income of $19,619 and an increase in capital paid-in of $4,735. This represents the amounts necessary to report these balances on a tax basis, excluding certain temporary differences, as of October 31, 2006. Additional adjustments may be needed in subsequent reporting periods. These reclassifications, which have no impact on the net asset value of the Fund, are

Greater China Opportunities Fund

26

primarily attributable to certain differences in the computation of distributable income and capital gains under federal tax rules versus accounting principles generally accepted in the United States of America, book and tax differences in accounting for certain foreign currency adjustments and equalization. The calculation of net investment income per share in the Fund’s Financial Highlights excludes these adjustments.

Greater China Opportunities Fund

27

Auditors’ report

Report of Independent Registered Public Accounting Firm

To the Board of Trustees of the John Hancock Investment Trust III and Shareholders of John Hancock Greater China Opportunities Fund,

In our opinion, the accompanying statement of assets and liabilities, including the schedule 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 John Hancock Greater China Opportunity Fund (the “Fund”) as of October 31, 2006, the results of its operations, the changes in its net assets and the financial highlights for the periods then ended, 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 Fund’s 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 as of October 31, 2006 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.

PricewaterhouseCoopers LLP
Boston, Massachusetts
December 13, 2006

28

Tax information

Unaudited

For federal income tax purposes, the following information is furnished with respect to the distributions of the Fund, if any, paid during its taxable year ended October 31, 2006.

The Fund has designated distributions to shareholders of $2,608 as a long-term capital gain dividend.

With respect to the ordinary dividends paid by the Fund for the fiscal year ended October 31, 2006, 18.76% of the dividends qualifies for the corporate dividends-received deduction.

The Fund hereby designates the maximum amount allowable of its net taxable income as qualified dividend income as provided in the Jobs and Growth Tax Relief Reconciliation Act of 2003. This amount will be reflected on Form 1099-DIV for the calendar year 2006.

Shareholders will be mailed a 2006 U.S. Treasury Department Form 1099-DIV in January 2007. This will reflect the total of all distributions that are taxable for calendar year 2006.

29

Board Consideration of and Continuation of Investment Advisory Agreement and Sub-Advisory Agreement: John Hancock Greater China Opportunities Fund

The Investment Company Act of 1940 (the “1940 Act”) requires the Board of Trustees (the “Board”) of John Hancock Investment Trust III (the “Trust”), including a majority of the Trustees who have no direct or indirect interest in the investment advisory agreement and are not “interested persons” of the Trust, as defined in the 1940 Act (the “Independent Trustees”), annually to review and consider the continuation of: (i) the investment advisory agreement (the “Advisory Agreement”) with John Hancock Advisers, LLC (the “Adviser”) and (ii) the investment sub-advisory agreement (the “Sub-Advisory Agreement”) with MFC Global Investment Management (U.S.A.), Limited (the “Sub-Adviser”) for the John Hancock Greater China Opportunities Fund (the “Fund”). The Advisory Agreement and the Sub-Advisory Agreement are collectively referred to as the “Advisory Agreements.”< /P>

At meetings held on May 1-2 and June 5-6, 2006,¹ the Board considered the factors and reached the conclusions described below relating to the selection of the Adviser and Sub-Adviser and the continuation of the Advisory Agreements. During such meetings, the Board’s Contracts/Operations Committee and the Independent Trustees also met in executive sessions with their independent legal counsel.

In evaluating the Advisory Agreements, the Board, including the Contracts/Operations Committee and the Independent Trustees, reviewed a broad range of information requested for this purpose by the Independent Trustees, including: (i) the investment performance of the Fund relative to a category of relevant funds (the “Category”) and a peer group of comparable funds (the “Peer Group”) each selected by Morningstar Inc. (“Morningstar”), an independent provider of investment company data, for a range of periods ended December 31, 2005; (ii) advisory and other fees incurred by, and the expense ratios of, the Fund relative to a Category and a Peer Group; (iii) the advisory fees of comparable portfolios of other clients of the Adviser and the Sub-Adviser; (iv) the Adviser’s financial results and condition, including its and certain of its affiliates’ profitability from services performed for the Fund; (v) br eakpoints in the Fund’s and the Peer Group’s fees, and information about economies of scale; (vi) the Adviser’s and Sub-Adviser’s record of compliance with applicable laws and regulations, with the Fund’s investment policies and restrictions and with the applicable Code of Ethics, and the structure and responsibilities of the Adviser’s and Sub-Adviser’s compliance department; (vii) the background and experience of senior management and investment professionals and (viii) the nature, cost and character of advisory and non-investment management services provided by the Adviser and its affiliates and by the Sub-Adviser.

The Board’s review and conclusions were based on a comprehensive consideration of all information presented to the Board and not the result of any single controlling factor. It was based on performance and other information as of December 31, 2005; facts may have changed between that date and the date of this shareholders report. The key factors considered by the Board and the conclusions reached are described below.

Nature, extent and quality of services

The Board considered the ability of the Adviser and the Sub-Adviser, based on their resources, reputation and other attributes, to attract and retain qualified investment professionals, including research, advisory and supervisory personnel. The Board further considered the compliance programs and compliance records of the Adviser and Sub-Adviser. In addition, the Board took into account the administrative services provided to the Fund by the Adviser and its affiliates.

Based on the above factors, together with those referenced below, the Board concluded that, within the context of its full deliberations, the nature, extent and quality of the investment advisory services provided to the Fund by the Adviser and Sub-Adviser were sufficient to support renewal of the Advisory Agreements.

30

Fund performance

The Board recognized that the Fund had less than one year of operational history and, therefore, did not receive a comparative analysis of the Fund’s investment performance from Morningstar.

Investment advisory fee and sub-advisory fee rates and expenses

The Board reviewed and considered the contractual investment advisory fee rate payable by the Fund to the Adviser for investment advisory services (the “Advisory Agreement Rate”). The Board received and considered information comparing the Advisory Agreement Rate with the advisory fees for the Peer Group and Category. The Board noted that the Advisory Agreement Rate was equal to the median rate of the Peer Group and not appreciably higher than the median rate of the Category.

The Board received and considered expense information regarding the Fund’s various components, including advisory fees, distribution and fees other than advisory and distribution fees, including transfer agent fees, custodian fees and other miscellaneous fees (e.g., fees for accounting and legal services). The Board considered comparisons of these expenses to the Peer Group median. The Board also received and considered expense information regarding the Fund’s total operating expense ratio (“Gross Expense Ratio”) and total operating expense ratio after taking the fee waiver arrangement applicable to the Advisory Agreement Rate into account (“Net Expense Ratio”). The Board received and considered information comparing the Gross Expense Ratio and Net Expense Ratio of the Fund to that of the Peer Group and Category medians. The Board noted that the Fund’s Gross Expense Ratio was higher than the median of its Category and Peer Group. The Bo ard also noted that the Fund’s Net Expense Ratio was higher than the median of its Category and lower than the median of its Peer Group. The Board favorably considered the impact of fee caps towards ultimately lowering the Fund’s total operating expense ratio.

The Adviser also discussed the Morningstar data and rankings, and other relevant information, for the Fund. Based on the above-referenced considerations and other factors, the Board concluded that the Fund’s overall expenses supported the re-approval of the Advisory Agreements.

The Board also received information about the investment sub-advisory fee rate (the “Sub-Advisory Agreement Rate”) payable by the Adviser to the Sub-Adviser for investment sub-advisory services. The Board concluded that the Sub-Advisory Agreement Rate was fair and equitable, based on its consideration of the factors described here.

Profitability

The Board received and considered a detailed profitability analysis of the Adviser based on the Advisory Agreements, as well as on other relationships between the Fund and the Adviser and its affiliates, including the Sub-Adviser. The Board concluded that, in light of the costs of providing investment management and other services to the Fund, the profits and other ancillary benefits reported by the Adviser were not unreasonable.

Economies of scale

The Board received and considered general information regarding economies of scale with respect to the management of the Fund, including the Fund’s ability to appropriately benefit from economies of scale under the Fund’s fee structure. The Board recognized the inherent limitations of any analysis of economies of scale, stemming largely from the Board’s understanding that most of the Adviser’s costs are not specific to individual Funds, but rather are incurred across a variety of products and services.

Information about services to other clients

The Board also received information about the nature, extent and quality of services and fee rates offered by the Adviser and Sub-Adviser to their other clients, including other registered investment companies, institutional investors and separate accounts. The Board concluded that the Advisory Agreement Rate and the Sub-Advisory Agreement Rate were not unreasonable, taking into account fee rates offered to others by the Adviser and Sub-Adviser, respectively, after giving effect to differences in services.

31

Other benefits to the Adviser

The Board received information regarding potential “fall-out” or ancillary benefits received by the Adviser and its affiliates as a result of the Adviser’s relationship with the Fund. Such benefits could include, among others, benefits directly attributable to the relationship of the Adviser with the Fund and benefits potentially derived from an increase in the business of the Adviser as a result of its relationship with the Fund (such as the ability to market to shareholders other financial products offered by the Adviser and its affiliates).

The Board also considered the effectiveness of the Adviser’s, Sub-Adviser’s and Fund’s policies and procedures for complying with the requirements of the federal securities laws, including those relating to best execution of portfolio transactions and brokerage allocation.

Other factors and broader review

As discussed above, the Board reviewed detailed materials received from the Adviser and Sub-Adviser as part of the annual re-approval process. The Board also regularly reviews and assesses the quality of the services that the Fund receives throughout the year. In this regard, the Board reviews reports of the Adviser and Sub-Adviser at least quarterly, which include, among other things, fund performance reports and compliance reports. In addition, the Board meets with portfolio managers and senior investment officers at various times throughout the year.

After considering the above-described factors and based on its deliberations and its evaluation of the information described above, the Board concluded that approval of the continuation of the Advisory Agreements for the Fund was in the best interest of the Fund and its shareholders. Accordingly, the Board unanimously approved the continuation of the Advisory Agreements.

¹ The Board previously considered information about the Sub-Advisory Agreement at the September and December 2005 Board meetings in connection with the Adviser’s reorganization.

32

Trustees and Officers

This chart provides information about the Trustees and Officers who oversee your John Hancock fund. Officers elected by the Trustees manage the day-to-day operations of the Fund and execute policies formulated by the Trustees.

Independent Trustees
Name, age		Number of
Position(s) held with Fund	Trustee	John Hancock
Principal occupation(s) and other	of Fund	funds overseen
directorships during past 5 years	since1	by Trustee
Ronald R. Dion , Born: 1946	2005	53
Independent Chairman (since 2005); Chairman and Chief Executive Officer,
R.M. Bradley & Co., Inc.; Director, The New England Council and Massachusetts
Roundtable; Trustee, North Shore Medical Center; Director, Boston Stock
Exchange; Director, BJ’s Wholesale Club, Inc. and a corporator of the Eastern
Bank; Trustee, Emmanuel College; Director, Boston Municipal Research Bureau;
Member of the Advisory Board, Carroll Graduate School of Management at
Boston College.
James F. Carlin, Born: 1940	2005	53
Director and Treasurer, Alpha Analytical Laboratories Inc. (chemical analysis)
(since 1985); Part Owner and Treasurer, Lawrence Carlin Insurance Agency,
Inc. (since 1995); Part Owner and Vice President, Mone Lawrence Carlin
Insurance Agency, Inc. (until 2005); Director and Treasurer, Rizzo Associates
(engineering) (until 2000); Chairman and CEO, Carlin Consolidated, Inc.
(management/investments) (since 1987); Director and Partner, Proctor Carlin
& Co., Inc. (until 1999); Trustee, Massachusetts Health and Education Tax
Exempt Trust (since 1993); Director of the following: Uno Restaurant Corp.
(until 2001), Arbella Mutual (insurance) (until 2000), HealthPlan Services, Inc.
(until 1999), Flagship Healthcare, Inc. (until 1999), Carlin Insurance Agency, Inc.
(until 1999); Chairman, Massachusetts Board of Higher Education (until 1999).
Richard P. Chapman, Jr.,2 Born: 1935	2005	53
President and Chief Executive Officer, Brookline Bancorp, Inc. (lending) (since
1972); Chairman and Director, Lumber Insurance Co. (insurance) (until 2000);
Chairman and Director, Northeast Retirement Services, Inc. (retirement
administration) (since 1998); Vice Chairman, Northeastern University Board
of Trustees (since 2004).
William H. Cunningham, Born: 1944	2005	158
Former Chancellor, University of Texas System and former President of the
University of Texas, Austin, Texas; Chairman and CEO, IBT Technologies (until
2001); Director of the following: Hire.com (until 2004), STC Broadcasting, Inc.
and Sunrise Television Corp. (until 2001), Symtx, Inc. (electronic manufacturing)
(since 2001), Adorno/Rogers Technology, Inc. (until 2004), Pinnacle Foods
Corporation (until 2003), rateGenius (until 2003), Lincoln National Corporation
(insurance) (since 2006), Jefferson-Pilot Corporation (diversified life insurance
company) (until 2006), New Century Equity Holdings (formerly Billing Concepts)

33

Independent Trustees (continued)
Name, age		Number of
Position(s) held with Fund	Trustee	John Hancock
Principal occupation(s) and other	of Fund	funds overseen
directorships during past 5 years	since1	by Trustee
William H. Cunningham, Born: 1944 (continued)	2005	158
(until 2001), eCertain (until 2001), ClassMap.com (until 2001), Agile Ventures
(until 2001), AskRed.com (until 2001), Southwest Airlines, Introgen and
Viasystems Group, Inc. (electronic manufacturer) (until 2003); Advisory
Director, Interactive Bridge, Inc. (college fundraising) (until 2001); Advisory
Director, Q Investments (until 2003); Advisory Director, JPMorgan Chase Bank
(formerly Texas Commerce Bank – Austin), LIN Television (since 2002), WilTel
Communications (until 2003) and Hayes Lemmerz International, Inc.
(diversified automotive parts supply company) (since 2003).
Charles L. Ladner,2 Born: 1938	2005	158
Chairman and Trustee, Dunwoody Village, Inc. (retirement services) (until 2003);
Senior Vice President and Chief Financial Officer, UGI Corporation (public utility
holding company) (retired 1998); Vice President and Director for AmeriGas, Inc.
(retired 1998); Director of AmeriGas Partners, L.P. (gas distribution) (until 1997);
Director, EnergyNorth, Inc. (until 1995); Director, Parks and History Association
(until 2007).
John A. Moore,2 Born: 1939	2005	53
President and Chief Executive Officer, Institute for Evaluating Health Risks,
(nonprofit institution) (until 2001); Senior Scientist, Sciences International
(health research) (until 2003); Former Assistant Administrator and Deputy
Administrator, Environmental Protection Agency; Principal, Hollyhouse
(consulting) (since 2000); Director, CIIT Center for Health Science Research
(nonprofit research) (since 2002).
Patti McGill Peterson,2 Born: 1943	2005	53
Executive Director, Council for International Exchange of Scholars and Vice
President, Institute of International Education (since 1998); Senior Fellow, Cornell
Institute of Public Affairs, Cornell University (until 1998); Former President of
Wells College and St. Lawrence University; Director, Niagara Mohawk Power
Corporation (until 2003); Director, Ford Foundation, International Fellowships
Program (since 2002); Director, Lois Roth Endowment (since 2002); Director,
Council for International Educational Exchange (since 2003).
Steven R. Pruchansky, Born: 1944	2005	53
Chairman and Chief Executive Officer, Greenscapes of Southwest Florida, Inc.
(since 2000); Director and President, Greenscapes of Southwest Florida, Inc.
(until 2000); Managing Director, JonJames, LLC (real estate) (since 2001);
Director, First Signature Bank & Trust Company (until 1991); Director, Mast
Realty Trust (until 1994); President, Maxwell Building Corp. (until 1991).

34

Non-Independent Trustee3
Name, age		Number of
Position(s) held with Fund	Trustee	John Hancock
Principal occupation(s) and other	of Fund	funds overseen
directorships during past 5 years	since1	by Trustee
James R. Boyle, Born: 1959	2005	260
President, John Hancock Annuities; Executive Vice President, John Hancock
Life Insurance Company (since June, 2004); Chairman and Director, John
Hancock Advisers, LLC (the “Adviser”), John Hancock Funds, LLC and The
Berkeley Financial Group, LLC (“The Berkeley Group”) (holding company) (since
2005); President, U.S. Annuities; Senior Vice President, The Manufacturers
Life Insurance Company (U.S.A.) (until 2004).
Principal officers who are not Trustees
Name, age
Position(s) held with Fund		Officer
Principal occupation(s) and		of Fund
directorships during past 5 years		since
Keith F. Hartstein, Born: 1956		2005
President and Chief Executive Officer
Senior Vice President, Manulife Financial Corporation (since 2004); Director,
President and Chief Executive Officer, the Adviser, The Berkeley Group, John
Hancock Funds, LLC (since 2005); Director, MFC Global Investment Management
(U.S.), LLC (“MFC Global (U.S.)”) (since 2005); Director, John Hancock Signature
Services, Inc. (since 2005); President and Chief Executive Officer, John Hancock
Investment Management Services, LLC (since 2006); President and Chief Executive
Officer, John Hancock Funds II, John Hancock Funds III and John Hancock Trust;
Director, Chairman and President, NM Capital Management, Inc. (since 2005);
Chairman, Investment Company Institute Sales Force Marketing Committee
(since 2003); Director, President and Chief Executive Officer, MFC Global (U.S.)
(2005–2006); Executive Vice President, John Hancock Funds, LLC (until 2005).
Thomas M. Kinzler, Born: 1955		2006
Secretary and Chief Legal Officer
Vice President and Counsel, John Hancock Life Insurance Company (U.S.A.)
(since 2006); Secretary and Chief Legal Officer, John Hancock Funds, John
Hancock Funds II, John Hancock Funds III and John Hancock Trust (since 2006);
Vice President and Associate General Counsel, Massachusetts Mutual Life
Insurance Company (1999–2006); Secretary and Chief Legal Counsel, MML
Series Investment Fund (2000–2006); Secretary and Chief Legal Counsel,
MassMutual Institutional Funds (2000–2004); Secretary and Chief Legal Counsel,
MassMutual Select Funds and MassMutual Premier Funds (2004–2006).
Francis V. Knox, Jr., Born: 1947		2005
Chief Compliance Officer
Vice President and Chief Compliance Officer, John Hancock Investment
Management Services, LLC, the Adviser and MFC Global (U.S.) (since 2005);
Vice President and Chief Compliance Officer, John Hancock Funds II, John
Hancock Funds III and John Hancock Trust (since 2005); Vice President and
Assistant Treasurer, Fidelity Group of Funds (until 2004); Vice President and
Ethics & Compliance Officer, Fidelity Investments (until 2001).

35

Principal officers who are not Trustees (continued)
Name, age
Position(s) held with Fund	Officer
Principal occupation(s) and	of Fund
directorships during past 5 years	since
Gordon M. Shone, Born: 1956	2006
Treasurer
Treasurer, John Hancock Funds (since 2006), John Hancock Funds II, John
Hancock Funds III and John Hancock Trust (since 2005); Vice President and
Chief Financial Officer, John Hancock Trust (2003–2005); Senior Vice President,
John Hancock Life Insurance Company (U.S.A.) (since 2001); Vice President,
John Hancock Investment Management Services, Inc., John Hancock Advisers,
LLC (since 2006) and The Manufacturers Life Insurance Company (U.S.A.)
(1998–2000).
John G. Vrysen, Born: 1955	2005
Chief Financial Officer
Director, Executive Vice President and Chief Financial Officer, the Adviser, The
Berkeley Group and John Hancock Funds, LLC (since 2005); Executive Vice
President and Chief Financial Officer, John Hancock Investment Management
Services, LLC (since 2005); Vice President and Chief Financial Officer, MFC Global
(U.S.) (since 2005); Director, John Hancock Signature Services, Inc. (since 2005);
Chief Financial Officer, John Hancock Funds II, John Hancock Funds III and John
Hancock Trust (since 2005); Vice President and General Manager, Fixed Annuities,
U.S. Wealth Management (until 2005); Vice President, Operations, Manulife
Wood Logan (2000–2004).

The business address for all Trustees and Officers is 601 Congress Street, Boston, Massachusetts 02210-2805.

The Statement of Additional Information of the Fund includes additional information about members of the Board of Trustees of the Fund and is available, without charge, upon request, by calling 1-800-225-5291.

¹Each Trustee serves until resignation, retirement age or until his or her successor is elected.

²Member of Audit Committee.

³Non-Independent Trustee holds positions with the Fund’s investment adviser, underwriter and certain other affiliates.

36

For more information

The Fund’s proxy voting policies, procedures and records are available without charge, upon request:

By phone	On the Fund’s Web site	On the SEC’s Web site
1-800-225-5291	www.jhfunds.com/proxy	www.sec.gov
Investment adviser	Custodian	Legal counsel
John Hancock Advisers, LLC	The Bank of New York	Kirkpatrick & Lockhart
601 Congress Street	One Wall Street	Nicholson Graham LLP
Boston, MA 02210-2805	New York, NY 10286	1 Lincoln Street
		Boston, MA 02110-2950
Subadviser	Transfer agent
MFC Global Investment	John Hancock Signature	Independent registered
Management (U.S.A.) Limited	Services, Inc.	public accounting firm
200 Bloor Street East	1 John Hancock Way,	PricewaterhouseCoopers LLP
Toronto, Ontario, Canada	Suite 1000	125 High Street
M4W 1E5	Boston, MA 02217-1000	Boston, MA 02110
Principal distributor
John Hancock Funds, LLC
601 Congress Street
Boston, MA 02210-2805

The Fund’s investment objective, risks, charges and expenses are included in the prospectus and should be considered carefully before investing. For a prospectus, call your financial professional, call John Hancock Funds at 1-800-225-5291 or visit the Fund’s Web site at www.jhfunds.com. Please read the prospectus carefully before investing or sending money.

How to contact us
Internet	www.jhfunds.com
Mail	Regular mail:	Express mail:
	John Hancock	John Hancock
	Signature Services, Inc.	Signature Services, Inc.
	1 John Hancock Way, Suite 1000	Mutual Fund Image Operations
	Boston, MA 02217-1000	380 Stuart Street
		Boston, MA 02116
Phone	Customer service representatives	1-800-225-5291
	24-hour automated information	1-800-338-8080
	TDD line	1-800-554-6713

A listing of month-end portfolio holdings is available on our Web site, www.jhfunds.com. A more detailed portfolio holdings summary is available on a quarterly basis 60 days after the fiscal quarter on our Web site or upon request by calling 1-800-225-5291, or on the Securities and Exchange Commission’s Web site, www.sec.gov.

40

J O H N H A N C O C K F A M I L Y O F

F U N D S

EQUITY	INTERNATIONAL
Balanced Fund	Greater China Opportunities Fund
Classic Value Fund	International Classic Value Fund
Classic Value Fund II	International Core Fund
Core Equity Fund	International Fund
Focused Equity Fund	International Growth Fund
Growth Fund
Growth Opportunities Fund	INCOME
Growth Trends Fund	Bond Fund
Intrinsic Value Fund	Government Income Fund
Large Cap Equity Fund	High Yield Fund
Large Cap Select Fund	Investment Grade Bond Fund
Mid Cap Equity Fund	Strategic Income Fund
Mid Cap Growth Fund
Multi Cap Growth Fund	TAX- FREE INCOME
Small Cap Equity Fund	California Tax-Free Income Fund
Small Cap Fund	High Yield Municipal Bond Fund
Small Cap Intrinsic Value Fund	Massachusetts Tax-Free Income Fund
Sovereign Investors Fund	New York Tax-Free Income Fund
U.S. Core Fund	Tax-Free Bond Fund
U.S. Global Leaders Growth Fund
Value Opportunities Fund	MONEY MARKET
	Money Market Fund
ASSET ALLOCATION & LIFESTYLE	U.S. Government Cash Reserve
Allocation Core Portfolio
Allocation Growth + Value Portfolio	CLOSED-END
Lifestyle Aggressive Portfolio	Bank & Thrift Opportunity
Lifestyle Balanced Portfolio	Financial Trends
Lifestyle Conservative Portfolio	Income Securities
Lifestyle Growth Portfolio	Investors Trust
Lifestyle Moderate Portfolio	Patriot Global Dividend
	Patriot Preferred Dividend
SECTOR	Patriot Premium Dividend I
Financial Industries Fund	Patriot Premium Dividend II
Health Sciences Fund	Patriot Select Dividend
Real Estate Fund	Preferred Income
Regional Bank Fund	Preferred Income II
Technology Fund	Preferred Income III
Technology Leaders Fund	Tax-Advantaged Dividend

For more complete information on any John Hancock Fund and an Open-End fund prospectus, which includes charges and expenses, call your financial professional, or John Hancock Funds at 1-800-225-5291 for Open-End fund information and 1-800-852-0218 for Closed-End fund information. Please read the Open-End fund prospectus carefully before investing or sending money.

1-800-225-5291
1-800-554-6713 (TDD)
1-800-338-8080 EASI-Line

www.jhfunds. com

Now available:electronicdelivery
www.jhfunds.com/edelivery

This report is for the information of the shareholders of John HancockGreater China Opportunities Fund.

0800A 10/06
12/06

CEO corner

TABLE OF CONTENTS 

Your fund at a glance 

page 1 

Manager’s report 

page 2 

A look at performance 

page 6 

Your expenses 

page 8 

Fund’s investments 

page 1 0 

Financial statements 

page 1 3 

Notes to financial 

statements 

page 2 0 

Trustees and officers 

page 3 0 

For more information 

page 3 6 

To Our Shareholders,

The future has arrived at John Hancock Funds.

We have always been firm believers in the powerful role the Internet can play in providing fund information to our shareholders and prospective investors. Recently, we launched a redesigned, completely overhauled Web site that is more visually pleasing, easier to navigate and, most importantly, provides more fund information and learning tools without overwhelming the user.

Not long after we embarked on this major project, a study was released by the Investment Company Institute, the mutual fund industry’s main trade group, which found that an overwhelming majority of shareholders consider the Internet the “wave of the future” for accessing fund information.

Our new site sports fresher and faster ways to access account information. New innovations allow investors to view funds by risk level, track the performance of the John Hancock funds of their choice or sort funds by Morningstar, Inc.’s star ratings. Investors who own a John Hancock fund through a qualified retirement plan and don’t pay sales charges when making a purchase have the option of sorting by a “Load Waived” Morningstar Rating, thereby creating an apples-to-apples comparison with no-load funds that may also be available in their retirement plan.

The new site also has more educational tools and interactive modules to educate and assist investors with their financial goals, from college savings to retirement planning. A new “I want to…” feature allows investors to check performance, invest more money, update personal information or download prospectuses and forms quickly and easily.

In another of our ongoing efforts to provide our shareholders with top-notch service, we also redesigned our shareholder reports, as you may have noticed with this report. We hope the larger size, more colorful cover and redesigned presentation of the commentary and data tables will draw you in and make them easier to read.

After you’ve read your shareholder report, we encourage you to visit our new Web site — www.jhfunds.com — and take a tour. It’s easy, fast and fun and allows you to be in control of what you see and do. In short, it’s the wave of the future!

Sincerely,

Keith F. Hartstein,
President and Chief Executive Officer

This commentary reflects the CEO’s views as of October 31, 2006. They are subject to change at any time.

Your fund at a glance

The Fund seeks long-term capital appreciation by investing at least 80% of its assets in stocks of medium-capitalization companies (in the capitalization range of the Russell Midcap Growth Index) with above-average earnings growth.

Over the last twelve months

► The stock market posted strong gains, benefiting from an end to interest rate hikes and a decline in oil prices late in the period.

► Mid-cap stocks came out a bit ahead of large caps and slightly behind small caps.

► Technology and consumer discretionary stocks aided the Fund’s returns, while energy and health care investments detracted from performance.

John Hancock Mid Cap Growth Fund

Fund performance for the year ended October 31, 2006.

Total returns for the Fund are at net asset value with all distributions reinvested. These returns do not reflect the deduction of the maximum sales charge, which would reduce the performance shown above.

Top 10 holdings
Jarden Corp.	6.5%	Gen-Probe, Inc.	4.2%
Varian Semiconductor Equipment		Trident Microsystems, Inc.	4.1%
Associates, Inc.	5.2%	Coach, Inc.	4.0%
Comverse Technology, Inc.	5.2%	Abercrombie & Fitch Co. (Class A)	3.8%
Sotheby’s Holdings, Inc. (Class A)	5.0%	Advance Auto Parts, Inc.	3.7%
Quality Systems, Inc.	4.7%

As a percentage of net assets on October 31, 2006.

1

Manager’s report
John Hancock

Mid Cap Growth Fund

Stocks posted strong gains for the year ended October 31, 2006, with the Standard & Poor’s 500 Index, a broad measure of the market’s performance, returning 16.34% . The market advanced nicely during the first half of the period, despite rising interest rates and climbing energy prices. Stocks, however, abruptly reversed course in May and early June, pressured by a global liquidity crunch and uncertainty over the Federal Reserve’s next move. The market rebounded over the summer, buoyed by the Fed’s decision to leave interest rates unchanged. Late in the summer, oil prices fell, as investors anticipated slower global economic growth, saw supply from the Gulf Coast come back on line and became less concerned about possible supply disruptions in the Middle East. The expectation of lower energy costs for both consumers and corporations helped spark a strong rally in October that brought the Dow Jones Ind ustrial Average to new highs. Stocks of all sizes benefited, with mid- and small-cap stocks coming out modestly ahead of large-cap issues for the year, and value stocks beating more expensive growth stocks.

Performance and strategy review

John Hancock Mid Cap Growth Fund’s Class A, Class B, Class C and Class I shares returned 9.75%, 8.93%, 9.05% and 12.11%, respectively, at net asset value for the 12 months ended October 31, 2006. These gains fell behind the 11.88% average return for the Morningstar group

SCORECARD

INVESTMENT		PERIOD’S PERFORMANCE... AND WHAT’S BEHIND THE NUMBERS
Sotheby’s Holdings	▲	Cost restructuring, strong art cycle
Rigel	▼	Disappointing clinical trials for new allergy drug
Pharmaceuticals
Grant Prideco	▼	Declining oil prices, decreased demand for services

2

Portfolio Manager, MFC Global Investment Management (U.S.), LLC
Thomas P. Norton, CFA

“Stock selection in the technology
and consumer discretionary
sectors gave the biggest boost to
performance.”

of mid-cap growth funds over the same period.¹ In addition, the Fund’s performance trailed the 14.51% return for the Russell Midcap Growth Index. Keep in mind that your net asset value return will be different from the Fund’s if you were not invested in the Fund for the entire period and did not reinvest all distributions. Long-term performance can be found on pages six and seven.

The Fund specifically targeted mid-cap companies with above-average earnings and revenue growth potential, sustainable competitive advantages and improving returns on invested capital. In addition, we looked for stocks with reasonable valuations. We continued to build the portfolio from the bottom up, using quantitative screens to help us identify potential opportunities and then narrowing our focus through our own research.

Strong returns from technology and consumer discretionary

Stock selection in the technology and consumer discretionary sectors gave the biggest boost to performance. In technology, Redback Networks, Inc. and MEMC Electronic Materials, Inc. were standouts. Redback, which makes routers used in wireless and wireline networks, benefited from improved product offerings that helped it gain ground over its competitors. MEMC Electronic sells polysilica, the raw material used to make the wafers on which semiconductors are imprinted. It also manufactures finished wafers. MEMC’s stock price climbed, as industry supply constraints drove up pricing for wafers and as the company began supplying finished wafers to the solar industry. The Fund also benefited from having an above-average stake in the technology sector, where returns outpaced those of the Russell index.

Mid Cap Growth Fund

3

In the consumer discretionary sector, some of our biggest winners were restructuring stories. Art auctioneer Sotheby’s Holdings, Inc., continued to benefit from a cost restructuring as well as a strong art cycle. Retailer Abercrombie & Fitch Co. saw strong gains after cutting costs and picking the right fashions to drive strong same-store sales. Starwood Hotels & Resorts Worldwide, Inc. saw profit margins and return on invested capital rise as the company sold some of its properties and began operating them for a fee. In addition, growth in the company’s time sharing business benefited returns.

Added gains from individual stock selection

Other top contributors to performance came from an array of sectors. Monster Worldwide, Inc., an Internet job-search company, benefited from growing demand for its services as well as the sale of some unrelated divisions. Cephalon, Inc. a biotechnology/pharmaceutical company that specializes in treatments for sleep and neurological disorders, had a strong run as the company came closer to gaining approval from the Food and Drug Administration for some new drugs. Phelps Dodge Corp., a leading copper company, also rallied nicely as increased demand and supply constraints drove commodity prices higher. We took profits and sold both Monster and Phelps Dodge.

Disappointing returns from energy and health care stocks

Investments in the energy and health care sectors, which did not perform as expected, caused the Fund to fall behind the index and its peer group. The Fund had an above-average stake in energy stocks, which were hurt by declining oil prices late in the period. Detractors included Grant Prideco, Inc., an energy service company that met or beat its earnings estimates throughout the year, but fell along with the sector. In health care, Rigel Pharmaceuticals, Inc. and PDL BioPharma, Inc. suffered steep downturns as promising drugs in development faltered. We sold Rigel, but kept PDL because of its strong royalty revenue stream. Selected stocks in the consumer discretionary sector also pressured performance. They included XM Satellite Radio Holdings, Inc. and Urban Outfitters, Inc. XM took a nosedive as subscriber growth slowed and the company ran into regulatory issues that slowed approvals for its new portable radios. XM also lost ground when popular radio personality Howard Stern signed with competitor Sirius Satellite (not in the portfolio).

SECTOR DISTRIBUTION2
Consumer discretionary	35%
Information technology	30%
Energy	12%
Health care	8%
Industrials	6%
Materials	3%
Consumer staples	3%
Financials	3%

Mid Cap Growth Fund

4

Urban Outfitters, a retailer with a history of very strong earnings and revenue growth, declined because of a misstep with its fashion mix.

“The Fund had an above-average
stake in energy stocks, which
were hurt by declining oil prices
late in the period.”

Prone to optimism

As we look ahead to the coming year, we feel more optimistic than pessimistic. Oil prices seem to be headed down, which should lower costs and boost corporate profit margins. We also believe a more favorable interest rate environment could help stock returns. By period end, the Fed had met three times without raising rates, a sign that the days of interest rate hikes might be over. Looking ahead, we believe inflation numbers could fall, especially given that third quarter gross domestic product numbers were weaker than expected. We plan to monitor economic indicators closely for signs of a slowdown worldwide, while remaining focused on mid-cap companies with established businesses and strong earnings growth track records that can do well in any market environment.

This commentary reflects the views of the portfolio manager through the end of the Fund’s period discussed in this report. The manager’s statements reflect his own opinions. As such, they are in no way guarantees of future events, and are not intended to be used as investment advice or a recommendation regarding any specific security. They are also subject to change at any time as market and other conditions warrant. 

¹ Figures from Morningstar, Inc. include reinvested dividends and do not take into account sales charges. Actual load-adjusted performance is lower.

² As a percentage of net assets on October 31, 2006.

Mid Cap Growth Fund

5

A look at performance

For the periods ending October 31, 2006

		Average annual returns				Cumulative total returns
		with maximum sales charge (POP)				with maximum sales charge (POP)
	Inception				Since				Since
Class	date	1-year	5-year	10-year	inception	1-year	5-year	10-year	inception
A	11-1-93	4.24%	5.59%	2.00%	—	4.24%	31.27%	21.92%	—
B	11-1-93	3.93	5.61	1.95	—	3.93	31.38	21.27	—
C	6-1-98	8.05	5.95	—	0.86%	8.05	33.52	—	7.52%
I1	3-1-02	12.11	—	—	6.83	12.11	—	—	36.15

Performance figures assume all distributions are reinvested. Returns with maximum sales charge reflect a sales charge on Class A shares of 5% and the applicable contingent deferred sales charge (CDSC) on Class B and Class C shares. The returns for Class C shares have been adjusted to reflect the elimination of the front-end sales charge effective July 15, 2004. The Class B shares’ CDSC declines annually between years 1–6 according to the following schedule: 5, 4, 3, 3, 2, 1%. No sales charge will be assessed after the sixth year. Class C shares held for less than one year are subject to a 1% CDSC. Sales charge is not applicable for Class I shares.

The returns reflect past results and should not be considered indicative of future performance. The return and principal value of an investment will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Due to market volatility, the Fund’s current performance may be higher or lower than the performance shown. For performance data current to the most recent month end, please call 1-800-225-5291 or visit the Fund’s Web site at www.jhfunds.com.

The performance table above and the chart on the next page do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.

The Fund’s performance results reflect any applicable expense reductions, without which the expenses would increase and results would have been less favorable.

¹For certain types of investors as described in the Fund’s Class I share prospectus.

Mid Cap Growth Fund

6

Growth of $10,000

This chart shows what happened to a hypothetical $10,000 investment in Class A shares for the period indicated. For comparison, we’ve shown the same investment in two separate indexes.

		Without sales	With maximum
Class	Period beginning	charge	sales charge	Index 1	Index 2
B1	10-31-96	$12,127	$12,127	$22,903	$23,099
C1	6-1-98	10,752	10,752	14,398	16,822
I 2	3-1-02	13,615	13,615	13,223	15,331

Assuming all distributions were reinvested for the period indicated, the table above shows the value of a $10,000 investment in the Fund’s Class B, Class C and Class I shares, respectively, as of October 31, 2006. The Class C shares investment with maximum sales charge has been adjusted to reflect the elimination of the front-end sales charge effective July 15, 2004. Performance of the classes will vary based on the difference in sales charges paid by shareholders investing in the different classes and the fee structure of those classes.

Standard & Poor’s 500 Index — Index 1 — is an unmanaged index that includes 500 widely traded common stocks.

Russell Midcap Growth Index — Index 2 — is an unmanaged index that contains those stocks from the Russell Midcap Index with a greater-than-average growth orientation.

It is not possible to invest directly in an index. Index figures do not reflect sales charges which would have resulted in lower values if they did.

¹ No contingent deferred sales charge applicable.

² For certain types of investors as described in the Fund’s Class I share prospectus.

Mid Cap Growth Fund

7

Your expenses

These examples are intended to help you understand your ongoing operating expenses.

Understanding fund expenses

As a shareholder of the Fund, you incur two types of costs:

■ Transaction costs which include sales charges (loads) on purchases or redemptions (varies by share class), minimum account fee charge, etc.

■ Ongoing operating expenses including management fees, distribution and service fees (if applicable) and other fund expenses.

We are going to present only your ongoing operating expenses here.

Actual expenses/actual returns

This example is intended to provide information about your fund’s actual ongoing operating expenses, and is based on your fund’s actual return. It assumes an account value of $1,000.00 on May 1, 2006, with the same investment held until October 31, 2006.

	Account value	Ending value	Expenses paid during period
	on 5-1-06	on 10-31-06	ended 10-31-061
Class A	$1,000.00	$920.00	$6.82
Class B	1,000.00	916.20	10.16
Class C	1,000.00	917.10	10.16
Class I	1,000.00	936.80	4.75

Together with the value of your account, you may use this information to estimate the operating expenses that you paid over the period. Simply divide your account value at October 31, 2006 by $1,000.00, then multiply it by the “expenses paid” for your share class from the table above. For example, for an account value of $8,600.00, the operating expenses should be calculated as follows:

Mid Cap Growth Fund

8

Hypothetical example for comparison purposes

This table allows you to compare your fund’s ongoing operating expenses with those of any other fund. It provides an example of the Fund’s hypothetical account values and hypothetical expenses based on each class’s actual expense ratio and an assumed 5% annual return before expenses (which is not your fund’s actual return). It assumes an account value of $1,000.00 on May 1, 2006, with the same investment held until October 31, 2006. Look in any other fund shareholder report to find its hypothetical example and you will be able to compare these expenses.

	Account value	Ending value	Expenses paid during period
	on 5-1-06	on 10-31-06	ended 10-31-061
Class A	$1,000.00	$1,018.10	$7.16
Class B	1,000.00	1,014.60	10.68
Class C	1,000.00	1,014.60	10.68
Class I	1,000.00	1,020.30	4.95

Remember, these examples do not include any transaction costs, such as sales charges; therefore, these examples will not help you to determine the relative total costs of owning different funds. If transaction costs were included, your expenses would have been higher. See the prospectus for details regarding transaction costs.

¹ Expenses are equal to the Fund’s annualized expense ratio of 1.41%, 2.10%, 2.11% and 0.97% for Class A, Class B, Class C and Class I, respectively, multiplied by the average account value over the period, multiplied by number of days in most recent fiscal half-year/365 or 366 (to reflect the one-half year period).

Mid Cap Growth Fund 9

Fund’s investments

F I N A N C I A L  S T A T E M E N T S

Securities owned by the Fund on 10-31-06

This schedule is divided into two main categories: common stocks and short-term investments. Common stocks are further broken down by industry group. Short-term investments, which represent the Fund’s cash position, are listed last.

Issuer	Shares	Value
Common stocks 99.72%		$124,772,085
(Cost $105,577,345)
Apparel, Accessories & Luxury Goods 3.99%		4,994,640
Coach, Inc. (I)	126,000	4,994,640
Apparel Retail 6.56%		8,206,310
Abercrombie & Fitch Co. (Class A)	61,400	4,706,310
Urban Outfitters, Inc. (I)(L)	200,000	3,500,000
Asset Management & Custody Banks 2.53%		3,169,431
Affiliated Managers Group, Inc. (I)(L)	31,650	3,169,431
Auto Parts & Equipment 3.67%		4,587,620
Advance Auto Parts, Inc.	131,000	4,587,620
Biotechnology 1.49%		1,859,770
Cephalon, Inc. (I)(L)	26,500	1,859,770
Broadcasting & Cable TV 3.21%		4,016,870
XM Satellite Radio Holdings, Inc. (Class A) (I)(L)	344,500	4,016,870
Coal & Consumable Fuels 2.25%		2,815,470
Aventine Renewable Energy Holdings, Inc. (I)	114,450	2,815,470
Communications Equipment 5.22%		6,531,000
Comverse Technology, Inc. (I)	300,000	6,531,000
Computer Storage & Peripherals 2.92%		3,650,790
SanDisk Corp. (I)	75,900	3,650,790
Diversified Commercial Services 4.99%		6,237,700
Sotheby’s	164,150	6,237,700
Electrical Components & Equipment 3.03%		3,794,400
Rockwell Automation, Inc.	61,200	3,794,400
Electronic Manufacturing Services 2.04%		2,549,448
Jabil Circuit, Inc. (I)	88,800	2,549,448
Health Care Services 2.57%		3,213,873
PDL BioPharma, Inc. (I)(L)	152,100	3,213,873
Health Care Supplies 4.17%		5,217,830
Gen-Probe, Inc. (I)	109,000	5,217,830

See notes to financial statements

Mid Cap Growth Fund

10

F I N A N C I A L   S T A T E M E N T S

Issuer	Shares	Value
Hotels, Resorts & Cruise Lines 3.44%		$4,301,280
Starwood Hotels & Resorts Worldwide, Inc.	72,000	4,301,280
Household Appliances 2.48%		3,106,239
iRobot Corp. (I)(L)	151,450	3,106,239
Internet Retail 2.83%		3,543,680
Redback Networks, Inc. (I)(L)	224,000	3,543,680
Leisure Products 6.51%		8,149,470
Jarden Corp. (I)(L)	226,500	8,149,470
Metal & Glass Containers 3.43%		4,286,520
Crown Holdings, Inc. (I)	220,500	4,286,520
Oil & Gas Drilling 2.78%		3,476,870
ENSCO International, Inc.	71,000	3,476,870
Oil & Gas Equipment & Services 4.55%		5,691,740
BJ Services Co.	71,000	2,141,360
Grant Prideco, Inc. (I)	94,000	3,550,380
Oil & Gas Exploration & Production 4.89%		6,121,000
Pinnacle Gas Resources Inc. (I)(S)	300,000	3,300,000
Toreador Resources Corp. (I)	130,000	2,821,000
Semiconductor Equipment 8.27%		10,354,275
MEMC Electronic Materials, Inc. (I)	106,650	3,786,075
Varian Semiconductor Equipment Associates, Inc. (I)(L)	180,000	6,568,200
Semiconductors 4.15%		5,186,699
Trident Microsystems, Inc. (I)(L)	245,350	5,186,699
Soft Drinks 3.04%		3,810,000
Hansen Natural Corp. (I)	120,000	3,810,000
Systems Software 4.71%		5,899,160
Quality Systems, Inc. (I)(L)	139,000	5,899,160

See notes to financial statements

Mid Cap Growth Fund

11

F I N A N C I A L  S T A T E M E N T S

	Interest	Par value
Issuer, description, maturity date	rate	(000)	Value
Short-term investments 29.41%			$36,796,636
(Cost $36,796,636)
Joint Repurchase Agreement 0.49%			614,000
Investment in a joint repurchase
agreement transaction with
Morgan Stanley — Dated 10-31-06
due 11-01-06 (secured by U.S.
Treasury Inflation Indexed Bond
3.375% due 4-15-32).
Maturity value: $614,090	5.270%	$614	614,000
		Shares
Cash Equivalents 28.92%			36,182,636
AIM Cash Investment Trust (T)		36,182,636	36,182,636
Total investments (cost $142,373,981) 129.13%			$161,568,721
Other assets and liabilities, net (29.13%)			($36,444,475)
Total net assets 100.00%			$125,124,246

(I) Non-income-producing security.

(L) All or a portion of this security is on loan as of October 31, 2006.

(S) This security is exempt from registration under Rule 144A of the Securities Act of 1933. Such security may be resold, normally to qualified institutional buyers, in transactions exempt from registration. Rule 144A securities amounted to $3,300,000 or 2.64% of the Fund’s net assets as of October 31, 2006.

(T) Represents investment of securities lending collateral.

The percentage shown for each investment category is the total value of that category as a percentage of the net assets of the Fund.

See notes to financial statements

Mid Cap Growth Fund

12

F I N A N C I A L   S T A T E M E N T S

Financial statements

Statement of assets and liabilities 10-31-06

This Statement of Assets and Liabilities is the Fund’s balance sheet. It shows the value of what the Fund owns, is due and owes. You’ll also find the net asset value and the maximum offering price per share.

Assets
Investments at value (cost $142,373,981) including	$161,568,721
$35,208,135 of securities loaned
Cash	463
Receivable for shares sold	28,767
Interest receivable	90
Receivable from affiliates	68,335
Other assets	19,695
Total assets	161,686,071
Liabilities
Payable for shares repurchased	171,459
Payable upon receipt of securities loaned	36,182,636
Payable to affiliates
Management fees	88,067
Distribution and service fees	7,592
Other	37,911
Other payables and accrued expenses	74,160
Total liabilities	36,561,825
Net assets
Capital paid-in	172,811,984
Accumulated net realized loss on investments	(66,860,880)
Net unrealized appreciation of investments	19,194,740
Accumulated net investment loss	(21,598)
Net assets	$125,124,246
Net asset value per share
Based on net asset values and shares outstanding — the Fund has an
unlimited number of shares authorized with no par value
Class A ($100,021,471 ÷ 9,451,093 shares)	$10.58
Class B ($21,691,704 ÷ 2,280,003 shares)	$9.51
Class C ($3,360,865 ÷ 353,152 shares)	$9.52
Class I ($50,206 ÷ 4,519 shares)	$11.11
Maximum offering price per share
Class A1 ($10.58 ÷ 95%)	$11.14

¹ On single retail sales of less than $50,000. On sales of $50,000 or more and on group sales the offering price is reduced.

See notes to financial statements

Mid Cap Growth Fund

13

F I N A N C I A L  S T A T E M E N T S

Statement of operations For the year ended 10-31-06.

This Statement of Operations summarizes the Fund’s investment income earned and expenses incurred in operating the Fund. It also shows net gains (losses) for the period stated.

Investment income
Dividends (including special dividends of $342,430)	$677,502
Interest	120,738
Securities lending	109,773
Total investment income	908,013
Expenses
Investment management fees (Note 2)	1,102,252
Distribution and service fees (Note 2)	608,940
Class A, B and C transfer agent fees (Note 2)	538,549
Class I transfer agent fees (Note 2)	1,086
Accounting and legal services fees (Note 2)	24,682
Compliance fees	4,927
Bluesky fees	45,476
Printing	40,767
Custodian fees	32,389
Professional fees	28,555
Trustees’ fees	7,776
Securities lending fees	4,340
Interest	2,971
Miscellaneous	11,593
Total expenses	2,454,303
Less expense reductions (Note 2)	(126,889)
Net expenses	2,327,414
Net investment loss	(1,419,401)
Realized and unrealized gain
Net realized gain on investments	11,893,275
Change in net unrealized appreciation (depreciation) of investments	1,390,874
Net realized and unrealized gain	13,284,149
Increase in net assets from operations	$11,864,748

See notes to financial statements

Mid Cap Growth Fund

14

F I N A N C I A L   S T A T E M E N T S

Statement of changes in net assets

These Statements of Changes in Net Assets show how the value of the Fund’s net assets has changed during the last two periods. The difference reflects earnings less expenses, any investment gains and losses, distributions, if any, paid to shareholders and the net of Fund share transactions.

	Year	Year
	ended	ended
	10-31-05	10-31-06
Increase (decrease) in net assets
From operations
Net investment loss	($2,034,837)	($1,419,401)
Net realized gain	14,025,629	11,893,275
Change in net unrealized appreciation (depreciation)	7,653,313	1,390,874
Increase in net assets resulting from operations	19,644,105	11,864,748
From Fund share transactions	(23,917,624)	(19,795,326)
Net assets
Beginning of period	137,328,343	133,054,824
End of period1	$133,054,824	$125,124,246

¹ Includes accumulated net investment loss of $21,598 and $21,598, respectively.

See notes to financial statements

Mid Cap Growth Fund

15

F I N A N C I A L  S T A T E M E N T S

Financial highlights

The Financial highlights show how the Fund’s net asset value for a share has changed since the end of the previous period.

CLASS A SHARES
Period ended	10-31-02	10-31-03	10-31-04	10-31-05	10-31-06
Per share operating performance
Net asset value, beginning of period	$7.66	$6.47	$8.43	$8.33	$9.64
Net investment loss1	(0.11)	(0.11)	(0.12)	(0.12)	(0.09)10
Net realized and unrealized
gain (loss) on investments	(1.08)	2.07	0.02	1.43	1.03
Total from investment operations	(1.19)	1.96	(0.10)	1.31	0.94
Net asset value, end of period	$6.47	$8.43	$8.33	$9.64	$10.58
Total return2 (%)	(15.54)	30.29	(1.19)3	15.733	9.75
Ratios and supplemental data
Net assets, end of period
(in millions)	$85	$107	$98	$101	$100
Ratio of net expenses to average
net assets (%)	1.89	1.98	1.75	1.74	1.55
Ratio of gross expenses to average
net assets (%)	1.89	1.98	1.794	1.794	1.644
Ratio of net investment loss
to average net assets (%)	(1.52)	(1.62)	(1.44)	(1.35)	(0.89)10
Portfolio turnover (%)	2675	183	75	71	63

See notes to financial statements

Mid Cap Growth Fund

16

F I N A N C I A L   S T A T E M E N T S

Financial highlights

CLASS B SHARES
Period ended	10-31-02	10-31-03	10-31-04	10-31-05	10-31-06
Per share operating performance
Net asset value, beginning of period	$7.13	$5.98	$7.74	$7.59	$8.73
Net investment loss1	(0.16)	(0.15)	(0.17)	(0.17)	(0.15)10
Net realized and unrealized
gain (loss) on investments	(0.99)	1.91	0.02	1.31	0.93
Total from investment operations	(1.15)	1.76	(0.15)	1.14	0.78
Net asset value, end of period	$5.98	$7.74	$7.59	$8.73	$9.51
Total return2 (%)	(16.13)	29.43	(1.94)3	15.023	8.93
Ratios and supplemental data
Net assets, end of period
(in millions)	$46	$48	$34	$26	$22
Ratio of net expenses to average
net assets (%)	2.56	2.67	2.45	2.44	2.25
Ratio of gross expenses to average
net assets (%)	2.56	2.67	2.494	2.494	2.344
Ratio of net investment loss
to average net assets (%)	(2.20)	(2.31)	(2.14)	(2.03)	(1.59)10
Portfolio turnover (%)	2675	183	75	71	63

See notes to financial statements

Mid Cap Growth Fund

17

F I N A N C I A L  S T A T E M E N T S

Financial highlights

CLASS C SHARES
Period ended	10-31-02	10-31-03	10-31-04	10-31-05	10-31-06
Per share operating performance
Net asset value, beginning of period	$7.13	$5.99	$7.74	$7.59	$8.73
Net investment loss1	(0.16)	(0.15)	(0.17)	(0.17)	(0.15)10
Net realized and unrealized
gain (loss) on investments	(0.98)	1.90	0.02	1.31	0.94
Total from investment operations	(1.14)	1.75	(0.15)	1.14	0.79
Net asset value, end of period	$5.99	$7.74	$7.59	$8.73	$9.52
Total return2(%)	(15.99)	29.22	(1.94)3	15.023	9.05
Ratios and supplemental data
Net assets, end of period
(in millions)	$2	$3	$3	$3	$3
Ratio of net expenses to average
net assets (%)	2.58	2.68	2.45	2.44	2.25
Ratio of gross expenses to average
net assets (%)	2.58	2.68	2.494	2.494	2.344
Ratio of net investment loss
to average net assets (%)	(2.21)	(2.32)	(2.14)	(2.05)	(1.59)10
Portfolio turnover (%)	2675	183	75	71	63

See notes to financial statements

Mid Cap Growth Fund

18

F I N A N C I A L   S T A T E M E N T S

Financial highlights

CLASS I SHARES
Period ended	10-31-026	10-31-03	10-31-04	10-31-05	10-31-06
Per share operating performance
Net asset value, beginning of period	$8.16	$6.51	$8.54	$8.50	$9.91
Net investment loss1	(0.06)	(0.06)	(0.06)	(0.06)	(0.03)10
Net realized and unrealized
gain (loss) on investments	(1.59)	2.09	0.02	1.47	1.23
Total from investment operations	(1.65)	2.03	(0.04)	1.41	1.20
Net asset value, end of period	$6.51	$8.54	$8.50	$9.91	$11.11
Total return2 (%)	(20.22)7	31.18	(0.47)	16.59	12.11
Ratios and supplemental data
Net assets, end of period
(in millions)	$3	$3	$3	$3	$09
Ratio of net expenses to average
net assets (%)	1.468	1.22	1.02	1.04	1.00
Ratio of net investment loss
to average net assets (%)	(1.00)8	(0.85)	(0.71)	(0.65)	(0.27)10
Portfolio turnover (%)	2675	183	75	71	63

¹ Based on the average of the shares outstanding.

² Assumes dividend reinvestment and does not reflect the effect of sales charges.

³ Total returns would have been lower had certain expenses not been reduced during the periods shown.

⁴ Does not take into consideration expense reductions during the periods shown.

⁵ Excludes merger activity.

⁶ Class I shares began operations on 3-1-02.

⁷ Not annualized.

⁸ Annualized.

⁹ Less than $500,000.

¹⁰ Net investment loss per share and ratio of net investment loss to average net assets reflects a special dividend received by the Fund which amounted to the following amounts:

		Percentage
	Per share	of net assets
Class A	$0.03	0.25%
Class B	0.02	0.25
Class C	0.02	0.25
Class I	0.03	0.28

See notes to financial statements

Mid Cap Growth Fund

19

Notes to financial statements

Note 1 Accounting policies

John Hancock Mid Cap Growth Fund (the “Fund”) is a diversified series of John Hancock Investment Trust III (the “Trust”), an open-end management investment company registered under the Investment Company Act of 1940 (the “1940 Act”), as amended. The investment objective of the Fund is to achieve long-term capital appreciation.

The Trustees have authorized the issuance of multiple classes of shares of the Fund, designated as Class A, Class B, Class C and Class I shares. The shares of each class represent an interest in the same portfolio of investments of the Fund and have equal rights as to voting, redemptions, dividends and liquidation, except that certain expenses, subject to the approval of the Trustees, may be applied differently to each class of shares in accordance with current regulations of the Securities and Exchange Commission and the Internal Revenue Service. Shareholders of a class that bears distribution and service expenses under the terms of a distribution plan have exclusive voting rights to that distribution plan. Class B shares will convert to Class A shares eight years after purchase.

Significant accounting policies of the Fund are as follows:

Valuation of investments

Securities in the Fund’s portfolio are valued on the basis of market quotations, valuations provided by independent pricing services or, if quotations are not readily available, or the value has been materially affected by events occurring after the close of a foreign market, at fair value as determined in good faith in accordance with procedures approved by the Trustees. Short-term debt investments which have a remaining maturity of 60 days or less may be valued at amortized cost, which approximates market value. Investments in AIM Cash Investment Trust are valued at their net asset value each business day. All portfolio transactions initially expressed in terms of foreign currencies have been translated into U.S. dollars as described in “Foreign currency translation” below.

Joint repurchase agreement

Pursuant to an exemptive order issued by the Securities and Exchange Commission, the Fund, along with other registered investment companies having a management contract with John Hancock Advisers, LLC (the “Adviser”), a wholly owned subsidiary of John Hancock Financial Services, Inc., a subsidiary of Manulife Financial Corporation (“MFC”), may participate in a joint repurchase agreement transaction. Aggregate cash balances are invested in one or more large repurchase agreements, whose underlying securities are obligations of the U.S. government and/or its agencies. The Fund’s custodian bank receives delivery of the underlying securities for the joint account on the Fund’s behalf. The Adviser is responsible for ensuring that the agreement is fully collateralized at all times.

Investment transactions

Investment transactions are accounted for on a trade date plus one basis for daily net asset value calculations. However, for financial reporting purposes, investment transactions are reported on trade date. Net realized gains and losses on sales of investments are determined on the identified cost basis.

Class allocations

Income, common expenses and realized and unrealized gains (losses) are determined at the fund level and allocated daily to each class of shares based on the appropriate net asset value of the respective classes. Distribution and service fees, if any, and transfer agent fees for Class I shares, are calculated daily at the class level based on the appropriate net asset value

Mid Cap Growth Fund

20

of each class and the specific expense rate(s) applicable to each class.

Expenses

The majority of expenses are directly identifiable to an individual fund. Expenses that are not readily identifiable to a specific fund are allocated in such a manner as deemed equitable, taking into consideration, among other things, the nature and type of expense and the relative size of the funds.

Bank borrowings

The Fund is permitted to have bank borrowings for temporary or emergency purposes, including the meeting of redemption requests that otherwise might require the untimely disposition of securities. The Fund has entered into a syndicated line of credit agreement with various banks. This agreement enables the Fund to participate, with other funds managed by the Adviser, in an unsecured line of credit with banks, which permits borrowings of up to $150 million, collectively. Interest is charged to each fund based on its borrowing. In addition, a commitment fee is charged to each fund based on the average daily unused portion of the line of credit, and is allocated among the participating funds. The Fund had no borrowing activity under the line of credit during the year ended October 31, 2006.

Securities lending

The Fund may lend securities to certain qualified brokers who pay the Fund negotiated lender fees. The loans are collateralized at all times with cash or securities with a market value at least equal to the market value of the securities on loan. As with other extensions of credit, the Fund may bear the risk of delay of the loaned securities in recovery or even loss of rights in the collateral, should the borrower of the securities fail financially. At October 31, 2006, the Fund loaned securities having a market value of $35,208,135 collateralized by cash in the amount of $36,182,636. The cash collateral was invested in a short-term instrument. Securities lending expenses are paid by the Fund to the Adviser.

Federal income taxes

The Fund qualifies as a “regulated investment company” by complying with the applicable provisions of the Internal Revenue Code and will not be subject to federal income tax on taxable income that is distributed to shareholders. Therefore, no federal income tax provision is required. For federal income tax purposes, the Fund has $66,860,880 of a capital loss carryforward available, to the extent provided by regulations, to offset future net realized capital gains. To the extent that such carryforward is used by the Fund, no capital gain distributions will be made. The loss carryforward expires as follows: October 31, 2008 — $410,842, October 31, 2009 — $41,443,592 and October 31, 2010 — $25,006,446. Capital loss carryforward utilized for the year ended October 31, 2006 amounted to $11,893,275. Availability of a certain amount of the loss carryforward, which was acquired on June 7, 2002 in a merger, may be limit ed in a given year.

New accounting pronouncements

In June 2006, Financial Accounting Standards Board (“FASB”) Interpretation No. 48, Accounting for Uncertainty in Income Taxes (the “Interpretation”) was issued and is effective for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. The Interpretation prescribes a minimum threshold for financial statement recognition of the benefit of a tax position taken or expected to be taken in a tax return, and requires certain expanded disclosures. Management is currently evaluating the application of the Interpretation to the Fund and has not at this time quantified the impact, if any, resulting from the adoption of the Interpretation on the Fund’s financial statements.

In September 2006, FASB Standard No. 157, Fair Value Measurements (“FAS 157”) was issued, and is effective for fiscal years beginning after November 15, 2007. FAS 157 defines fair value, establishing a framework for measuring fair value and expands disclosure about fair value measurements. Management is currently evaluating the application of FAS 157 to the Fund and its impact, if any, resulting from the adoption of FAS 157 on the Fund’s financial statements.

Mid Cap Growth Fund

21

Dividends, interest and distributions

Dividend income on investment securities is recorded on the ex-dividend date or, in the case of some foreign securities, on the date thereafter when the Fund identifies the dividend. Interest income on investment securities is recorded on the accrual basis. Foreign income may be subject to foreign withholding taxes, which are accrued as applicable.

The Fund records distributions to shareholders from net investment income and net realized gains, if any, on the ex-dividend date. There were no distributions during the years ended October 31, 2005 and October 31, 2006. Distributions paid by the Fund with respect to each class of shares are calculated in the same manner, at the same time and are in the same amount, except for the effect of expenses that may be applied differently to each class.

As of October 31, 2006, the Fund had no distributable earnings on a tax basis.

Such distributions and distributable earnings, on a tax basis, are determined in conformity with income tax regulations, which may differ from accounting principles generally accepted in the United States of America. Distributions in excess of tax basis earnings and profits, if any, are reported in the Fund’s financial statements as a return of capital.

Use of estimates

The preparation of these financial statements, in accordance with accounting principles generally accepted in the United States of America, incorporates estimates made by management in determining the reported amount of assets, liabilities, revenues and expenses of the Fund. Actual results could differ from these estimates.

Note 2

Management fee and transactions with affiliates and others

The Fund has an investment management contract with the Adviser. Under the investment management contract, the Fund pays a monthly management fee to the Adviser equivalent, on an annual basis, to the sum of: (a) 0.80% of the first $500,000,000 of the Fund’s average daily net asset value; (b) 0.75% of the next $500,000,000 and (c) 0.70% of the Fund’s average daily net asset value in excess of $1,000,000,000.

Effective December 31, 2005, the investment management teams of the Adviser were reorganized into Sovereign Asset Management LLC (“Sovereign”), a wholly owned indirect subsidiary of John Hancock Life Insurance Company (“JHLICO”), a subsidiary of MFC. The Adviser remains the principal advisor on the Fund and Sovereign acts as subadviser under the supervision of the Adviser. The restructuring did not have an impact on the Fund, which continues to be managed using the same investment philosophy and process. The Fund is not responsible for payment of the subadvisory fees.

Effective October 1, 2006, Sovereign changed its name to MFC Global Investment Management (U.S.), LLC.

The Fund has a Distribution Agreement with John Hancock Funds, LLC (“JH Funds”), a wholly owned subsidiary of the Adviser. The Fund has adopted Distribution Plans with respect to Class A, Class B and Class C, pursuant to Rule 12b-1 under the 1940 Act, as amended, to reimburse JH Funds for the services it provides as distributor of shares of the Fund. Accordingly, the Fund makes monthly payments to JH Funds at an annual rate not to exceed 0.30%, 1.00% and 1.00% of average daily net asset value of Class A, Class B and Class C, respectively. A maximum of 0.25% of such payments may be service fees, as defined by the Conduct Rules of the National Association of Securities Dealers. Under the Conduct Rules, curtailment of a portion of the Fund’s 12b-1 payments could occur under certain circumstances.

Expenses under the agreement described above for the year ended October 31, 2006 were as follows:

	Distribution and
Share class	service fees
Class A	$320,213
Class B	253,139
Class C	35,588
Total	$608,940

Mid Cap Growth Fund

22

Class A shares are assessed up-front sales charges. During the year ended October 31, 2006, JH Funds received net up-front sales charges of $82,977 with regard to sales of Class A shares. Of this amount, $11,142 was retained and used for printing prospectuses, advertising, sales literature and other purposes, $57,807 was paid as sales commissions to unrelated broker-dealers and $14,028 was paid as sales commissions to sales personnel of Signator Investors, Inc. (“Signator Investors”), a related broker-dealer. The Adviser’s indirect parent JHLICO, is the indirect sole shareholder of Signator Investors.

Class B shares that are redeemed within six years of purchase are subject to a contingent deferred sales charge (“CDSC”) at declining rates, beginning at 5.00% of the lesser of the current market value at the time of redemption or the original purchase cost of the shares being redeemed. Class C shares that are redeemed within one year of purchase are subject to a CDSC at a rate of 1.00% of the lesser of the current market value at the time of redemption or the original purchase cost of the shares being redeemed. Proceeds from the CDSCs are paid to JH Funds and are used, in whole or in part, to defray its expenses for providing distribution-related services to the Fund in connection with the sale of Class B and Class C shares. During the year ended October 31, 2006, CDSCs received by JH Funds amounted to $42,129 for Class B shares and $473 for Class C shares.

The Fund has a transfer agent agreement with John Hancock Signature Services, Inc. (“Signature Services”), an indirect subsidiary of JHLICO. For Class A, Class B and Class C shares, the Fund pays a monthly transfer agent fee at an annual rate of 0.05% of each class’s average daily net asset value, plus a fee based on the number of shareholder accounts and reimbursement for certain out-of-pocket expenses, aggregated and allocated to each class on the basis of its relative net asset value. For Class I shares, the Fund pays a monthly transfer agent fee at a total annual rate of 0.05% of Class I average daily net asset value. Signature Services agreed to voluntarily reduce the Fund’s asset-based portion of the transfer agent fee if the total transfer agent fee exceeded the median transfer agency fee for comparable mutual funds by greater than 0.05% . Accordingly, the transfer agent expense for Class A, Class B and Class C sh ares was reduced by $58,554 for the year ended October 31, 2006. Signature Services terminated this reimbursement agreement June 30, 2006.

Effective July 1, 2006, the transfer agent has contractually limited transfer agent fees by implementing a transfer agent fee cap of 0.25% until June 30, 2007. Accordingly, the expense reductions related to transfer agent fee limitations amounted to $68,335 for the year ended October 31, 2006.

The Fund has an agreement with the Adviser and affiliates to perform necessary tax, accounting and legal services for the Fund. The compensation for the period amounted to $24,682. The Fund also paid the Adviser the amount of $562 for certain publishing services, included in the printing fees. The Fund reimbursed JHLICO for certain compliance costs, included in the Fund’s Statement of Operations.

Mr. James R. Boyle is Chairman of the Adviser, as well as affiliated Trustee of the Fund, and is compensated by the Adviser and/or its affiliates. The compensation of unaffiliated Trustees is borne by the Fund. The unaffiliated Trustees may elect to defer, for tax purposes, their receipt of this compensation under the John Hancock Group of Funds Deferred Compensation Plan. The Fund makes investments into other John Hancock funds, as applicable, to cover its liability for the deferred compensation. Investments to cover the Fund’s deferred compensation liability are recorded on the Fund’s books as an other asset. The deferred compensation liability and the related other asset are always equal and are marked to market on a periodic basis to reflect any income earned by the investments, as well as any unrealized gains or losses. The Deferred Compensation Plan investments had no impact on the operations of the Fund.

Mid Cap Growth Fund

23

Note 3

Fund share transactions

This listing illustrates the number of Fund shares sold and repurchased during the last two periods, along with the corresponding dollar value.

	Year ended 10-31-05		Year ended 10-31-06
	Shares	Amount	Shares	Amount
Class A shares
Sold	1,409,247	$12,651,836	1,339,646	$14,386,192
Repurchased	(2,642,146)	(23,854,729)	(2,406,419)	(25,197,460)
Net decrease	(1,232,899)	($11,202,893)	(1,066,773)	($10,811,268)
Class B shares
Sold	360,358	$2,949,863	429,834	$4,185,762
Repurchased	(1,864,803)	(15,142,628)	(1,118,239)	(10,605,302)
Net decrease	(1,504,445)	($12,192,765)	(688,405)	($6,419,540)
Class C shares
Sold	71,585	$588,127	97,325	$953,562
Repurchased	(97,294)	(795,276)	(111,323)	(1,036,697)
Net decrease	(25,709)	($207,149)	(13,998)	($83,135)
Class I shares
Sold	34,207	$316,376	63,358	$704,996
Repurchased	(69,584)	(631,193)	(318,605)	(3,186,379)
Net decrease	(35,377)	($314,817)	(255,247)	($2,481,383)
Net decrease	(2,798,430)	($23,917,624)	(2,024,423)	($19,795,326)

Note 4

Investment transactions

Purchases and proceeds from sales or maturities of securities, other than short-term securities and obligations of the U.S. government, during the year ended October 31, 2006, aggregated $84,734,065 and $104,097,984, respectively.

The cost of investments owned on October 31, 2006, including short-term investments, for federal income tax purposes, was $142,373,981. Gross unrealized appreciation and depreciation of investments aggregated $26,329,126 and $7,134,386, respectively, resulting in net unrealized appreciation of $19,194,740.

Note 5

Reclassification of accounts

During the year ended October 31, 2006, the Fund reclassified amounts to reflect a decrease in accumulated net investment loss of $1,419,401 and a decrease in capital paid-in of $1,419,401. This represents the amounts necessary to report these balances on a tax basis, excluding certain temporary differences, as of October 31, 2006. Additional adjustments may be needed in subsequent reporting periods. These reclassifications, which have no impact on the net asset value of the Fund, are primarily attributable to certain differences in the computation of distributable income and capital gains under federal tax rules versus accounting principles generally accepted in the United States of America, book and tax differences in accounting for net operating loss. The calculation of net investment loss per share in the Fund’s Financial Highlights excludes these adjustments.

Mid Cap Growth Fund

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Auditors’ report

Report of Independent Registered Public Accounting Firm

To the Board of Trustees of John Hancock Investment Trust III and Shareholders of John Hancock Mid Cap Growth Fund,

In our opinion, the accompanying statement of assets and liabilities, including the schedule 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 John Hancock Mid Cap Growth Fund (the “Fund”) as of October 31, 2006, the results of its operations, the changes in its net assets and the financial highlights for the periods indicated, 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 Fund’s 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 as of October 31, 2006 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.

PricewaterhouseCoopers LLP
Boston, Massachusetts
December 13, 2006

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Tax information

Unaudited

For federal income tax purposes, the following information is furnished with respect to the distributions of the Fund, if any, paid during its taxable year ended October 31, 2006.

The Fund hereby designates the maximum amount allowable of its net taxable income as qualified dividend income as provided in the Jobs and Growth Tax Relief Reconciliation Act of 2003. This amount will be reflected on Form 1099-DIV for the calendar year 2006.

Shareholders will be mailed a 2006 U.S. Treasury Department Form 1099-DIV in January 2007. This will reflect the total of all distributions that are taxable for calendar year 2006.

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Board Consideration of and Continuation of Investment Advisory Agreement and Sub-Advisory Agreement: John Hancock Mid Cap Growth Fund

The Investment Company Act of 1940 (the “1940 Act”) requires the Board of Trustees (the “Board”) of John Hancock Investment Trust III (the “Trust”), including a majority of the Trustees who have no direct or indirect interest in the investment advisory agreement and are not “interested persons” of the Trust, as defined in the 1940 Act (the “Independent Trustees”), annually to review and consider the continuation of: (i) the investment advisory agreement (the “Advisory Agreement”) with John Hancock Advisers, LLC (the “Adviser”) and (ii) the investment sub-advisory agreement (the “Sub-Advisory Agreement”) with MFC Global Investment Management (U.S.), LLC (the “Sub-Adviser”) for the John Hancock Mid Cap Growth Fund (the “Fund”). The Advisory Agreement and the Sub-Advisory Agreement are collectively referred to as the “Advisory Agreements.”

At meetings held on May 1–2 and June 5–6, 2006,¹ the Board considered the factors and reached the conclusions described below relating to the selection of the Adviser and Sub-Adviser and the continuation of the Advisory Agreements. During such meetings, the Board’s Contracts/Operations Committee and the Independent Trustees also met in executive sessions with their independent legal counsel.

In evaluating the Advisory Agreements, the Board, including the Contracts/Operations Committee and the Independent Trustees, reviewed a broad range of information requested for this purpose by the Independent Trustees, including: (i) the investment performance of the Fund relative to a category of relevant funds (the “Category”) and a peer group of comparable funds (the “Peer Group”) each selected by Morningstar Inc. (“Morningstar”), an independent provider of investment company data, for a range of periods ended December 31, 2005; (ii) advisory and other fees incurred by, and the expense ratios of, the Fund relative to a Category and a Peer Group; (iii) the advisory fees of comparable portfolios of other clients of the Adviser and the Sub-Adviser; (iv) the Adviser’s financial results and condition, including its and certain of its affiliates’ profitability from services performed for the Fund; (v) br eakpoints in the Fund’s and the Peer Group’s fees, and information about economies of scale; (vi) the Adviser’s and Sub-Adviser’s record of compliance with applicable laws and regulations, with the Fund’s investment policies and restrictions and with the applicable Code of Ethics, and the structure and responsibilities of the Adviser’s and Sub-Adviser’s compliance department; (vii) the background and experience of senior management and investment professionals and (viii) the nature, cost and character of advisory and non-investment management services provided by the Adviser and its affiliates and by the Sub-Adviser.

The Board’s review and conclusions were based on a comprehensive consideration of all information presented to the Board and not the result of any single controlling factor. It was based on performance and other information as of December 31, 2005; facts may have changed between that date and the date of this shareholders report. The key factors considered by the Board and the conclusions reached are described below.

Nature, extent and quality of services

The Board considered the ability of the Adviser and the Sub-Adviser, based on their resources, reputation and other attributes, to attract and retain qualified investment professionals, including research, advisory and supervisory personnel. The Board further considered the compliance programs and compliance records of the Adviser and Sub-Adviser. In addition, the Board took into account the administrative services provided to the Fund by the Adviser and its affiliates.

Based on the above factors, together with those referenced below, the Board concluded that, within the context of its full deliberations, the nature, extent and quality of the investment advisory services provided to the Fund by the Adviser and Sub-Adviser were sufficient to support renewal of the Advisory Agreements.

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Fund performance

The Board considered the performance results for the Fund over various time periods ended December 31, 2005. The Board also considered these results in comparison to the performance of the Category, as well as the Fund’s Peer Group and benchmark index. Morningstar determined the Category and the Peer Group for the Fund. The Board reviewed with a representative of Morningstar the methodology used by Morningstar to select the funds in the Category and the Peer Group. The Board noted the imperfect comparability of the Peer Group.

The Board noted that the Fund’s performance during the three-, five- and 10-year periods under review was lower than the performance of the Peer Group and Category medians, and its benchmark index, the Russell Midcap Growth Index. The Board also noted the Fund’s more recent performance during the one-year period under review was lower than the Peer Group median and the benchmark index, and higher than the Category median. The Adviser provided information to the Board regarding factors contributing to the Fund’s performance results, as well as the Adviser’s outlook and investment strategy for the near future. The Board indicated its intent to continue to monitor the Fund’s performance trends.

Investment advisory fee and sub-advisory fee rates and expenses

The Board reviewed and considered the contractual investment advisory fee rate payable by the Fund to the Adviser for investment advisory services (the “Advisory Agreement Rate”). The Board received and considered information comparing the Advisory Agreement Rate with the advisory fees for the Peer Group and Category. The Board noted that the Advisory Agreement Rate was not appreciably higher than the median rate of the Peer Group and Category.

The Board received and considered expense information regarding the Fund’s various components, including advisory fees, distribution and fees other than advisory and distribution fees, including transfer agent fees, custodian fees and other miscellaneous fees (e.g., fees for accounting and legal services). The Board also considered peer-adjusted comparisons for the transfer agent fees. The Board considered comparisons of these expenses to the Peer Group median. The Board also received and considered expense information regarding the Fund’s total operating expense ratio (“Gross Expense Ratio”) and total operating expense ratio after taking the fee waiver arrangement applicable to the Advisory Agreement Rate into account (“Net Expense Ratio”). The Board received and considered information comparing the Gross Expense Ratio and Net Expense Ratio o f the Fund to that of the Peer Group and Category medians. The Board noted that the Fund’s Gross and Net Expense Ratios were higher than the Peer Group and Category medians.

The Adviser also discussed the Morningstar data and rankings, and other relevant information, for the Fund. Based on the above-referenced considerations and other factors, the Board concluded that the Fund’s plans for improving overall performance and lowering the expenses supported the re-approval of the Advisory Agreements.

The Board also received information about the investment sub-advisory fee rate (the “Sub-Advisory Agreement Rate”) payable by the Adviser to the Sub-Adviser for investment sub-advisory services. The Board concluded that the Sub-Advisory Agreement Rate was fair and equitable, based on its consideration of the factors described here.

Profitability

The Board received and considered a detailed profitability analysis of the Adviser based on the Advisory Agreements, as well as on other relationships between the Fund and the Adviser and its affiliates, including the Sub-Adviser. The Board concluded that, in light of the costs of providing investment management and other services to the Fund, the profits and other ancillary benefits reported by the Adviser were not unreasonable.

Economies of scale

The Board received and considered general information regarding economies of scale with respect to the management of the Fund, including the Fund’s ability to appropriately benefit from economies of scale under the

28

Fund’s fee structure. The Board recognized the inherent limitations of any analysis of economies of scale, stemming largely from the Board’s understanding that most of the Adviser’s costs are not specific to individual Funds, but rather are incurred across a variety of products and services.

To the extent the Board and the Adviser were able to identify actual or potential economies of scale from Fund-specific or allocated expenses, in order to ensure that any such economies continue to be reasonably shared with the Fund as its assets increase, the Adviser and the Board agreed to continue the existing breakpoints to the Advisory Agreement Rate.

Information about services to other clients

The Board also received information about the nature, extent and quality of services and fee rates offered by the Adviser and Sub-Adviser to their other clients, including other registered investment companies, institutional investors and separate accounts. The Board concluded that the Advisory Agreement Rate and the Sub-Advisory Agreement Rate were not unreasonable, taking into account fee rates offered to others by the Adviser and Sub-Adviser, respectively, after giving effect to differences in services.

Other benefits to the Adviser

The Board received information regarding potential “fall-out” or ancillary benefits received by the Adviser and its affiliates as a result of the Adviser’s relationship with the Fund. Such benefits could include, among others, benefits directly attributable to the relationship of the Adviser with the Fund and benefits potentially derived from an increase in the business of the Adviser as a result of its relationship with the Fund (such as the ability to market to shareholders other financial products offered by the Adviser and its affiliates).

The Board also considered the effectiveness of the Adviser’s, Sub-Adviser’s and Fund’s policies and procedures for complying with the requirements of the federal securities laws, including those relating to best execution of portfolio transactions and brokerage allocation.

Other factors and broader review

As discussed above, the Board reviewed detailed materials received from the Adviser and Sub-Adviser as part of the annual re-approval process. The Board also regularly reviews and assesses the quality of the services that the Fund receives throughout the year. In this regard, the Board reviews reports of the Adviser and Sub-Adviser at least quarterly, which include, among other things, fund performance reports and compliance reports. In addition, the Board meets with portfolio managers and senior investment officers at various times throughout the year.

After considering the above-described factors and based on its deliberations and its evaluation of the information described above, the Board concluded that approval of the continuation of the Advisory Agreements for the Fund was in the best interest of the Fund and its shareholders. Accordingly, the Board unanimously approved the continuation of the Advisory Agreements.

¹ The Board previously considered information about the Sub-Advisory Agreement at the September and December 2005 Board meetings in connection with the Adviser’s reorganization.

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Trustees and Officers

This chart provides information about the Trustees and Officers who oversee your John Hancock fund. Officers elected by the Trustees manage the day-to-day operations of the Fund and execute policies formulated by the Trustees.

Independent Trustees
Name, age		Number of
Position(s) held with Fund	Trustee	John Hancock
Principal occupation(s) and other	of Fund	funds overseen
directorships during past 5 years	since1	by Trustee
Ronald R. Dion , Born: 1946	2005	53
Independent Chairman (since 2005); Chairman and Chief Executive Officer,
R.M. Bradley & Co., Inc.; Director, The New England Council and Massachusetts
Roundtable; Trustee, North Shore Medical Center; Director, Boston Stock
Exchange; Director, BJ’s Wholesale Club, Inc. and a corporator of the Eastern
Bank; Trustee, Emmanuel College; Director, Boston Municipal Research Bureau;
Member of the Advisory Board, Carroll Graduate School of Management at
Boston College.
James F. Carlin , Born: 1940	2005	53
Director and Treasurer, Alpha Analytical Laboratories Inc. (chemical analysis)
(since 1985); Part Owner and Treasurer, Lawrence Carlin Insurance Agency,
Inc. (since 1995); Part Owner and Vice President, Mone Lawrence Carlin
Insurance Agency, Inc. (until 2005); Director and Treasurer, Rizzo Associates
(engineering) (until 2000); Chairman and CEO, Carlin Consolidated, Inc.
(management/investments) (since 1987); Director and Partner, Proctor Carlin
& Co., Inc. (until 1999); Trustee, Massachusetts Health and Education Tax
Exempt Trust (since 1993); Director of the following: Uno Restaurant Corp.
(until 2001), Arbella Mutual (insurance) (until 2000), HealthPlan Services, Inc.
(until 1999), Flagship Healthcare, Inc. (until 1999), Carlin Insurance Agency, Inc.
(until 1999); Chairman, Massachusetts Board of Higher Education (until 1999).
Richard P. Chapman, Jr.,2 Born: 1935	1996	53
President and Chief Executive Officer, Brookline Bancorp, Inc. (lending) (since
1972); Chairman and Director, Lumber Insurance Co. (insurance) (until 2000);
Chairman and Director, Northeast Retirement Services, Inc. (retirement
administration) (since 1998); Vice Chairman, Northeastern University Board
of Trustees (since 2004).
William H. Cunningham , Born: 1944	2005	158
Former Chancellor, University of Texas System and former President of the
University of Texas, Austin, Texas; Chairman and CEO, IBT Technologies (until
2001); Director of the following: Hire.com (until 2004), STC Broadcasting, Inc.
and Sunrise Television Corp. (until 2001), Symtx, Inc. (electronic manufacturing)
(since 2001), Adorno/Rogers Technology, Inc. (until 2004), Pinnacle Foods
Corporation (until 2003), rateGenius (until 2003), Lincoln National Corporation
(insurance) (since 2006), Jefferson-Pilot Corporation (diversified life insurance
company) (until 2006), New Century Equity Holdings (formerly Billing Concepts)

30

Independent Trustees (continued)
Name, age		Number of
Position(s) held with Fund	Trustee	John Hancock
Principal occupation(s) and other	of Fund	funds overseen
directorships during past 5 years	since1	by Trustee
William H. Cunningham , Born: 1944 (continued)	2005	158
(until 2001), eCertain (until 2001), ClassMap.com (until 2001), Agile Ventures
(until 2001), AskRed.com (until 2001), Southwest Airlines, Introgen and
Viasystems Group, Inc. (electronic manufacturer) (until 2003); Advisory
Director, Interactive Bridge, Inc. (college fundraising) (until 2001); Advisory
Director, Q Investments (until 2003); Advisory Director, JPMorgan Chase Bank
(formerly Texas Commerce Bank – Austin), LIN Television (since 2002), WilTel
Communications (until 2003) and Hayes Lemmerz International, Inc.
(diversified automotive parts supply company) (since 2003).
Charles L. Ladner,2 Born: 1938	2004	158
Chairman and Trustee, Dunwoody Village, Inc. (retirement services) (until 2003);
Senior Vice President and Chief Financial Officer, UGI Corporation (public utility
holding company) (retired 1998); Vice President and Director for AmeriGas, Inc.
(retired 1998); Director of AmeriGas Partners, L.P. (gas distribution) (until 1997);
Director, EnergyNorth, Inc. (until 1995); Director, Parks and History Association
(until 2007).
John A. Moore,2 Born: 1939	1993	53
President and Chief Executive Officer, Institute for Evaluating Health Risks,
(nonprofit institution) (until 2001); Senior Scientist, Sciences International
(health research) (until 2003); Former Assistant Administrator and Deputy
Administrator, Environmental Protection Agency; Principal, Hollyhouse
(consulting) (since 2000); Director, CIIT Center for Health Science Research
(nonprofit research) (since 2002).
Patti McGill Peterson,2 Born: 1943	1993	53
Executive Director, Council for International Exchange of Scholars and Vice
President, Institute of International Education (since 1998); Senior Fellow, Cornell
Institute of Public Affairs, Cornell University (until 1998); Former President of
Wells College and St. Lawrence University; Director, Niagara Mohawk Power
Corporation (until 2003); Director, Ford Foundation, International Fellowships
Program (since 2002); Director, Lois Roth Endowment (since 2002); Director,
Council for International Educational Exchange (since 2003).
Steven R. Pruchansky, Born: 1944	2005	53
Chairman and Chief Executive Officer, Greenscapes of Southwest Florida, Inc.
(since 2000); Director and President, Greenscapes of Southwest Florida, Inc.
(until 2000); Managing Director, JonJames, LLC (real estate) (since 2001);
Director, First Signature Bank & Trust Company (until 1991); Director, Mast
Realty Trust (until 1994); President, Maxwell Building Corp. (until 1991).

31

Non-Independent Trustee3
Name, age		Number of
Position(s) held with Fund	Trustee	John Hancock
Principal occupation(s) and other	of Fund	funds overseen
directorships during past 5 years	since1	by Trustee
James R. Boyle, Born: 1959	2005	260
President, John Hancock Annuities; Executive Vice President, John Hancock
Life Insurance Company (since June, 2004); Chairman and Director, John
Hancock Advisers, LLC (the “Adviser”), John Hancock Funds, LLC and The
Berkeley Financial Group, LLC (“The Berkeley Group”) (holding company) (since
2005); President, U.S. Annuities; Senior Vice President, The Manufacturers
Life Insurance Company (U.S.A.) (until 2004).
Principal officers who are not Trustees
Name, age
Position(s) held with Fund		Officer
Principal occupation(s) and		of Fund
directorships during past 5 years		since
Keith F. Hartstein, Born: 1956		2005
President and Chief Executive Officer
Senior Vice President, Manulife Financial Corporation (since 2004); Director,
President and Chief Executive Officer, the Adviser, The Berkeley Group, John
Hancock Funds, LLC (since 2005); Director, MFC Global Investment Management
(U.S.), LLC (“MFC Global (U.S.)”) (since 2005); Director, John Hancock Signature
Services, Inc. (since 2005); President and Chief Executive Officer, John Hancock
Investment Management Services, LLC (since 2006); President and Chief Executive
Officer, John Hancock Funds II, John Hancock Funds III and John Hancock Trust;
Director, Chairman and President, NM Capital Management, Inc. (since 2005);
Chairman, Investment Company Institute Sales Force Marketing Committee
(since 2003); Director, President and Chief Executive Officer, MFC Global (U.S.)
(2005–2006); Executive Vice President, John Hancock Funds, LLC (until 2005).
Thomas M. Kinzler, Born: 1955		2006
Secretary and Chief Legal Officer
Vice President and Counsel, John Hancock Life Insurance Company (U.S.A.)
(since 2006); Secretary and Chief Legal Officer, John Hancock Funds, John
Hancock Funds II, John Hancock Funds III and John Hancock Trust (since 2006);
Vice President and Associate General Counsel, Massachusetts Mutual Life
Insurance Company (1999–2006); Secretary and Chief Legal Counsel, MML
Series Investment Fund (2000–2006); Secretary and Chief Legal Counsel,
MassMutual Institutional Funds (2000–2004); Secretary and Chief Legal Counsel,
MassMutual Select Funds and MassMutual Premier Funds (2004–2006).
Francis V. Knox, Jr., Born: 1947		2005
Chief Compliance Officer
Vice President and Chief Compliance Officer, John Hancock Investment
Management Services, LLC, the Adviser and MFC Global (U.S.) (since 2005);
Vice President and Chief Compliance Officer, John Hancock Funds II, John
Hancock Funds III and John Hancock Trust (since 2005); Vice President and
Assistant Treasurer, Fidelity Group of Funds (until 2004); Vice President and
Ethics & Compliance Officer, Fidelity Investments (until 2001).

32

Principal officers who are not Trustees (continued)
Name, age
Position(s) held with Fund	Officer
Principal occupation(s) and	of Fund
directorships during past 5 years	since
Gordon M. Shone, Born: 1956	2006
Treasurer
Treasurer, John Hancock Funds (since 2006), John Hancock Funds II, John
Hancock Funds III and John Hancock Trust (since 2005); Vice President and
Chief Financial Officer, John Hancock Trust (2003–2005); Senior Vice President,
John Hancock Life Insurance Company (U.S.A.) (since 2001); Vice President,
John Hancock Investment Management Services, Inc., John Hancock Advisers,
LLC (since 2006) and The Manufacturers Life Insurance Company (U.S.A.)
(1998–2000).
John G. Vrysen, Born: 1955	2005
Chief Financial Officer
Director, Executive Vice President and Chief Financial Officer, the Adviser, The
Berkeley Group and John Hancock Funds, LLC (since 2005); Executive Vice
President and Chief Financial Officer, John Hancock Investment Management
Services, LLC (since 2005); Vice President and Chief Financial Officer, MFC Global
(U.S.) (since 2005); Director, John Hancock Signature Services, Inc. (since 2005);
Chief Financial Officer, John Hancock Funds II, John Hancock Funds III and John
Hancock Trust (since 2005); Vice President and General Manager, Fixed Annuities,
U.S. Wealth Management (until 2005); Vice President, Operations, Manulife
Wood Logan (2000–2004).

The business address for all Trustees and Officers is 601 Congress Street, Boston, Massachusetts 02210-2805.

The Statement of Additional Information of the Fund includes additional information about members of the Board of Trustees of the Fund and is available, without charge, upon request, by calling 1-800-225-5291.

¹Each Trustee serves until resignation, retirement age or until his or her successor is elected.

²Member of Audit Committee.

³Non-Independent Trustee holds positions with the Fund’s investment adviser, underwriter and certain other affiliates.

33

For more information

The Fund’s proxy voting policies, procedures and records are available without charge,
upon request:
By phone	On the Fund’s Web site	On the SEC’s Web site
1-800-225-5291	www.jhfunds.com/proxy	www.sec.gov
Investment adviser	Custodian	Legal counsel
John Hancock Advisers, LLC	The Bank of New York	Kirkpatrick & Lockhart
601 Congress Street	One Wall Street	Nicholson Graham LLP
Boston, MA 02210-2805	New York, NY 10286	1 Lincoln Street
		Boston, MA 02110-2950
Subadviser	Transfer agent
MFC Global Investment	John Hancock Signature	Independent registered
Management (U.S.), LLC	Services, Inc.	public accounting firm
101 Huntington Avenue	1 John Hancock Way,	PricewaterhouseCoopers LLP
Boston, MA 02199	Suite 1000	125 High Street
Principal distributor	Boston, MA 02217-1000	Boston, MA 02110
John Hancock Funds, LLC
601 Congress Street
Boston, MA 02210-2805

The Fund’s investment objective, risks, charges and expenses are included in the prospectus and should be considered carefully before investing. For a prospectus, call your financial professional, call John Hancock Funds at 1-800-225-5291 or visit the Fund’s Web site at www.jhfunds.com. Please read the prospectus carefully before investing or sending money.

How to contact us
Internet	www.jhfunds.com
Mail	Regular mail:	Express mail:
	John Hancock	John Hancock
	Signature Services, Inc.	Signature Services, Inc.
	1 John Hancock Way, Suite 1000	Mutual Fund Image Operations
	Boston, MA 02217-1000	380 Stuart Street
		Boston, MA 02116
Phone	Customer service representatives	1-800-225-5291
	24-hour automated information	1-800-338-8080
	TDD line	1-800-554-6713

A listing of month-end portfolio holdings is available on our Web site, www.jhfunds.com. A more detailed portfolio holdings summary is available on a quarterly basis 60 days after the fiscal quarter on our Web site or upon request by calling 1-800-225-5291, or on the Securities and Exchange Commission’s Web site, www.sec.gov.

36

J O H N   H A N C O C K   F A M I L Y   O F  F U N D S

EQUITY	INTERNATIONAL
Balanced Fund	Greater China Opportunities Fund
Classic Value Fund	International Classic Value Fund
Classic Value Fund II	International Core Fund
Core Equity Fund	International Fund
Focused Equity Fund	International Growth Fund
Growth Fund
Growth Opportunities Fund	INCOME
Growth Trends Fund	Bond Fund
Intrinsic Value Fund	Government Income Fund
Large Cap Equity Fund	High Yield Fund
Large Cap Select Fund	Investment Grade Bond Fund
Mid Cap Equity Fund	Strategic Income Fund
Mid Cap Growth Fund
Multi Cap Growth Fund	TAX-FREE INCOME
Small Cap Equity Fund	California Tax-Free Income Fund
Small Cap Fund	High Yield Municipal Bond Fund
Small Cap Intrinsic Value Fund	Massachusetts Tax-Free Income Fund
Sovereign Investors Fund	New York Tax-Free Income Fund
U.S. Core Fund	Tax-Free Bond Fund
U.S. Global Leaders Growth Fund
Value Opportunities Fund	MONEY MARKET
	Money Market Fund
ASSET ALLOCATION FUND	U.S. Government Cash Reserve
Allocation Core Portfolio
Allocation Growth + Value Portfolio	CLOSED END
Lifestyle Aggressive Portfolio	Bank & Thrift Opportunity
Lifestyle Balanced Portfolio	Financial Trends
Lifestyle Conservative Portfolio	Income Securities
Lifestyle Growth Portfolio	Investors Trust
Lifestyle Moderate Portfolio	Patriot Global Dividend
	Patriot Preferred Dividend
SECTOR	Patriot Premium Dividend I
Financial Industries Fund	Patriot Premium Dividend II
Health Sciences Fund	Patriot Select Dividend
Real Estate Fund	Preferred Income
Regional Bank Fund	Preferred Income II
Technology Fund	Preferred Income III
Technology Leaders Fund	Tax-Advantaged Dividend

For more complete information on any John Hancock Fund and an Open-End fund prospectus, which includes charges and expenses, call your financial professional, or John Hancock Funds at 1-800-225-5291 for Open-End fund information and 1-800-852-0218 for Closed-End fund information. Please read the Open-End fund prospectus carefully before investing or sending money.

1-800-225-5291
1-800-554-6713 (TDD)
1-800-338-8080 EASI-Line

www.jhfunds. com

Now available:electronicdelivery
www.jhfunds.com/edelivery

This report is for the information of the shareholders of John Hancock Mid Cap Growth Fund.

3900A 10/06
12/06

TABLE OF CONTENTS 

Your fund at a glance 

page 1 

Managers’ report 

page 2 

A look at performance 

page 6 

Your expenses 

page 8 

Fund’s investments 

page 1 0 

Financial statements 

page 1 4 

Notes to financial 

statements 

page 2 1 

Trustees and officers 

page 3 3 

For more information 

page 4 0 

CEO corner

To Our Shareholders,

The future has arrived at John Hancock Funds.

We have always been firm believers in the powerful role the Internet can play in providing fund information to our shareholders and prospective investors. Recently, we launched a redesigned, completely overhauled Web site that is more visually pleasing, easier to navigate and, most importantly, provides more fund information and learning tools without overwhelming the user.

Not long after we embarked on this major project, a study was released by the Investment Company Institute, the mutual fund industry’s main trade group, which found that an overwhelming majority of shareholders consider the Internet the “wave of the future” for accessing fund information.

Our new site sports fresher and faster ways to access account information. New innovations allow investors to view funds by risk level, track the performance of the John Hancock funds of their choice or sort funds by Morningstar, Inc.’s star ratings. Investors who own a John Hancock fund through a qualified retirement plan and don’t pay sales charges when making a purchase have the option of sorting by a “Load Waived” Morningstar Rating, thereby creating an apples-to-apples comparison with no-load funds that may also be available in their retirement plan.

The new site also has more educational tools and interactive modules to educate and assist investors with their financial goals, from college savings to retirement planning. A new “I want to…” feature allows investors to check performance, invest more money, update personal information or download prospectuses and forms quickly and easily.

In another of our ongoing efforts to provide our shareholders with top-notch service, we also redesigned our shareholder reports, as you may have noticed with this report. We hope the larger size, more colorful cover and redesigned presentation of the commentary and data tables will draw you in and make them easier to read.

After you’ve read your shareholder report, we encourage you to visit our new Web site — www.jhfunds.com — and take a tour. It’s easy, fast and fun and allows you to be in control of what you see and do. In short, it’s the wave of the future!

Sincerely,

Keith F. Hartstein,
President and Chief Executive Officer

This commentary reflects the CEO’s views as of October 31, 2006. They are subject to change at any time.

Your fund at a glance

The Fund seeks long-term growth of capital by normally investing at least 80% of its
assets in stocks of foreign companies.

Over the last twelve months

► Equity performance was strong around the world, led by impressive gains from emerging countries.

► The Fund’s growth-oriented strategy weighed on results versus the benchmark, because investors favored international value stocks over growth stocks.

► Stock selection in Hong Kong, Ireland and the telecommunication services and information technology sectors benefited relative performance.

Top 10 holdings
Sumitomo Mitsui Financial Group, Inc.	3.0%	UBS AG	2.4%
Toyota Motor Corp.	2.5%	Veolia Environnment SA	2.3%
ABB Ltd.	2.5%	AXA	2.2%
HSBC Holdings Plc	2.4%	Nestle SA	2.2%
Roche Holding AG	2.4%	Lafarge SA	2.1%

As a percentage of net assets on October 31, 2006.

1

Managers’ report

John Hancock

International Fund

International equity markets registered strong gains during the year ended October 31, 2006. U.S.-based investors further benefited from the appreciation of many foreign currencies versus the U.S. dollar, since this boosted international equity performance in dollar terms.

During the first half of the period, overseas stock markets advanced, as healthy economic and earnings growth globally eclipsed worries about inflation and tighter monetary policy from central banks worldwide. Equities sold off sharply in May, however, due to concerns over how newly appointed Federal Reserve Chairman Ben Bernanke would address the difficult combination of slowing growth and rising inflation in the United States. The downturn was short lived and investors bid stocks higher from June through October. The rally was driven by falling oil prices, a pause in U.S. monetary tightening and favorable developments within individual markets.

Equity performance was strong around the world, led by impressive gains from emerging countries, including China and India where economic growth was especially robust. Among developed countries, stocks in eurozone markets turned in some of the best results amid brisk takeover activity and the fastest pace of economic expansion in the region since 2000. Equity price appreciation in Japan was more subdued but still strong. The Bank of Japan raised interest rates in July

SCORECARD

INVESTMENT		PERIOD’S PERFORMANCE  . . . AND WHAT’S BEHIND THE NUMBERS
C&C Group	▲	Successful product launch
Millicom
International	▲	Rapid subscriber growth
Cellular
Siemens	▼	Disappointing pace of restructuring

2

Portfolio Managers, Nicholas-Applegate Capital Management, LLC
Horacio A. Valeiras, CFA, and Vince Willyard, CFA

after five years of a near-zero interest rate policy, reflecting its confidence in the country’s economic recovery.

From a sector perspective, equity gains were also broad based. Utilities was the best-performing group, buoyed by healthy demand for high-yielding securities from aging populations funding retirement incomes. The materials sector was another standout performer, as prices of many commodities, such as copper and nickel, increased throughout much of the period.

“International equity markets
  registered strong gains during
  the year ended October 31, 2006.”

 
Fund performance explained

For the 12 months ended October 31, 2006, John Hancock International Fund’s Class A, Class B, Class C and Class I shares rose 26.61%, 25.81%, 25.79% and 27.87%, respectively, at net asset value.  During the same time, the average foreign large-cap growth fund gained 25.97%, according to Morningstar, Inc.¹, and the benchmark MSCI All Country World Ex-U.S. Index advanced 25.55% . Keep in mind that your net asset value return will be different from the Fund’s performance if you were not invested in the Fund for the entire period and did not reinvest all distributions. See pages six and seven for historical performance information.

The Fund’s holdings in the majority of countries and in all sectors of investment generated gains, resulting in a strong total return for the year. On a comparative basis, the Fund performed in line with its Morningstar peer group and the MSCI All Country World Ex-U.S. Index. Consistent with our investment philosophy, positions are concentrated in growth stocks, while the index contains both growth and value names. Stock selection in Germany, France and in the financials and health care sectors weighed on relative results.

International Fund

3

On the plus side, stock selection in Hong Kong and Ireland added value relative to the benchmark, as did an overweight in Ireland where consumer spending accelerated. Furthermore, select positions in the telecommunication services and information technology sectors favorably affected performance versus the index.

Top-performing stocks included C&C Group Plc, an Irish food and beverage distributor that had a successful product launch; Millicom International Cellular SA, a Luxembourger wireless telecommunication services company that experienced rapid subscriber growth; and Foxconn International Holdings Ltd., a Chinese handset manufacturer that benefited from market share gains with existing customers. Decliners included Siemens AG, a German industrial conglomerate whose pace of restructuring was slower than investors anticipated; Générale de Santé, a French health care services provider that fell on expectations that the government would lower hospital rates; and Hokuhoku Financial Group, Inc., a Japanese regional bank that was weak on concerns that a potential change in its capital structure would dilute earnings per share.

Fund moves

During the year, there were changes in the Fund’s country and sector weightings that resulted from our stock-by-stock investment decisions. Assets were shifted from Canada and emerging markets in the Asia Pacific region, including South Korea and China, in favor of opportunities identified in developed European countries, such as Switzerland and the United Kingdom. Changes in sector allocations included a decrease in the Fund’s materials and telecommunication services holdings and an increase in exposure to consumer staples and financials.

SECTOR DISTRIBUTION2
Financials	28%
Consumer staples	13%
Consumer discretionary	12%
Industrials	11%
Information technology	8%
Health care	7%
Telecommunication
services	7%
Energy	6%
Utilities	3%
Materials	3%

Holdings remained well diversified at the end of the period, with broad representation across countries and sectors. Compared to the benchmark, the Fund was overweight stocks in developed Asian countries, particularly Japan, and underweight Canadian equities. The Fund was overweight consumer staples and information technology stocks and underweight materials and energy.

International Fund

4

Outlook

While rising geopolitical tensions are always a risk, international equities seem poised for additional gains as 2007 approaches. Economic activity in emerging countries should remain robust and leading economic indicators in major developed countries outside of Japan are positive, despite recent  declines. This supports our belief that the global economy will continue to grow, albeit at a more modest pace than in 2006. Although we anticipate further interest rate increases from the Bank of Japan and European Central Bank, commodity prices have fallen and inflationary pressures have eased in Europe. In addition, earnings growth should remain at healthy levels internationally, and most foreign markets still appear to be relatively undervalued based on price-to-earnings ratios. A slowdown in the global economy, tame inflation, good earnings growth and attractive valuations are an excellent recipe for higher share prices.

“The Fund’s holdings in the
  majority of countries and in all
  sectors of investment generated
  gains, resulting in a strong total
  return for the year.”

In this environment, we believe companies that can deliver strong earnings growth could once again command premium valuations relative to all others. The market seems to be rotating away from early cyclical stocks and sectors into more stable growth names, suggesting that several years of international value leadership may be coming to an end.

This commentary reflects the views of the portfolio management team through the end of the Fund’s period discussed in this report. The team’s statements reflect their own opinions. As such, they are in no way guarantees of future events, and are not intended to be used as investment advice or a recommendation regarding any specific security. They are also subject to change at any time as market and other conditions warrant.

International investing involves special risks such as political, economic and currency risks and differences in accounting standards and financial reporting.

¹ Figures from Morningstar, Inc. include reinvested dividends and do not take into account sales charges. Actual load-adjusted performance is lower.

² As a percentage of net assets on October 31, 2006.

International Fund

5

A look at performance

For the periods ending October 31, 2006

		Average annual returns				Cumulative total returns
		with maximum sales charge (POP)				with maximum sales charge (POP)
	Inception				Since					Since
Class	date	1-year	5-year	10-year	inception		1-year	5-year	10-year	inception
A	1-3-94	20.25%	9.45%	1.61%	—		20.25%	57.10%	17.32%	—
B	1-3-94	20.81	9.56	1.55	—		20.81	57.87	16.67	—
C	6-1-98	24.79	9.83	—	0.52%		24.79	59.79	—	4.49%
I1	3-1-02	27.87	—	—	12.36		27.87	—	—	72.31

Performance figures assume all distributions are reinvested. Returns with maximum sales charge reflect a sales charge on Class A shares of 5%, and the applicable contingent deferred sales charge (CDSC) on Class B and Class C shares. The returns for Class C shares have been adjusted to reflect the elimination of the front-end sales charge effective July 15, 2004. The Class B shares’ CDSC declines annually between years 1–6 according to the following schedule: 5, 4, 3, 3, 2, 1%. No sales charge will be assessed after the sixth year. Class C shares held for less than one year are subject to a 1% CDSC. Sales charge is not applicable for Class I shares.

The returns reflect past results and should not be considered indicative of future performance. The return and principal value of an investment will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Due to market volatility, the Fund’s current performance may be higher or lower than the performance shown. For performance data current to the most recent month-end, please call 1-800-225-5291 or visit the Fund’s Web site at www.jhfunds.com.

The performance table above and the chart on the next page do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.

The Fund’s performance results reflect any applicable expense reductions, without which the expenses would increase and results would have been less favorable.

¹For certain types of investors as described in the Fund’s Class I share prospectus.

International Fund

6

Growth of $10,000

This chart shows what happened to a hypothetical $10,000 investment in Class A shares for the period indicated. For comparison, we’ve shown the same investment in the MSCI All Country World Ex-U.S. Index.

			With maximum
Class	Period beginning	Without sales charge	sales charge	Index
B1	10-31-96	$11,667	$11,667	$17,619
C1	6-1-98	10,449	10,449	15,571
I 2	3-1-02	17,231	17,231	18,450

Assuming all distributions were reinvested for the period indicated, the table above shows the value of a $10,000 investment in the Fund’s Class B, Class C and Class I shares, respectively, as of October 31, 2006. The Class C shares investment with maximum sales charge has been adjusted to reflect the elimination of the front-end sales charge effective July 15, 2004. Performance of the classes will vary based on the difference in sales charges paid by shareholders investing in the different classes and the fee structure of those classes.

Morgan Stanley Capital International (MSCI) All Country World Ex-U.S. Index is an unmanaged index of freely traded stocks of foreign companies.

It is not possible to invest directly in an index. Index figures do not reflect sales charges which would have resulted in lower values if they did.

¹ No contingent deferred sales charge applicable.

² For certain types of investors as described in the Fund’s Class I share prospectus.

International Fund

7

Your expenses

These examples are intended to help you understand your ongoing
operating expenses.

Understanding fund expenses

As a shareholder of the Fund, you incur two types of costs:

▪ Transaction costs which include sales charges (loads) on purchases or redemptions (varies by share class), minimum account fee charge, etc.

▪ Ongoing operating expenses including management fees, distribution and service fees (if applicable) and other fund expenses.

We are going to present only your ongoing operating expenses here.

Actual expenses/actual returns

This example is intended to provide information about your fund’s actual ongoing operating expenses, and is based on your fund’s actual return. It assumes an account value of $1,000.00 on May 1, 2006, with the same investment held until October 31, 2006.

	Account value	Ending value	Expenses paid during period
	on 5-1-06	on 10-31-06	ended 10-31-061
Class A	$1,000.00	$995.60	$8.78
Class B	1,000.00	992.80	12.26
Class C	1,000.00	992.80	12.26
Class I	1,000.00	1,002.10	6.05

Together with the value of your account, you may use this information to estimate the operating expenses that you paid over the period. Simply divide your account value at October 31, 2006 by $1,000.00, then multiply it by the “expenses paid” for your share class from the table above. For example, for an account value of $8,600.00, the operating expenses should be calculated as follows:

International Fund

8

Hypothetical example for comparison purposes

This table allows you to compare your fund’s ongoing operating expenses with those of any other fund. It provides an example of the Fund’s hypothetical account values and hypothetical expenses based on each class’s actual expense ratio and an assumed 5% annual return before expenses (which is not your fund’s actual return). It assumes an account value of $1,000.00 on May 1, 2006, with the same investment held until October 31, 2006. Look in any other fund shareholder report to find its hypothetical example and you will be able to compare these expenses.

	Account value	Ending value	Expenses paid during period
	on 5-1-06	on 10-31-06	ended 10-31-061
Class A	$1,000.00	$1,016.40	$8.87
Class B	1,000.00	1,012.90	12.38
Class C	1,000.00	1,012.90	12.38
Class I	1,000.00	1,019.16	6.10

Remember, these examples do not include any transaction costs, such as sales charges; therefore, these examples will not help you to determine the relative total costs of owning different funds. If transaction costs were included, your expenses would have been higher. See the prospectus for details regarding transaction costs.

¹ Expenses are equal to the Fund’s annualized expense ratio of 1.75%, 2.45%, 2.45% and 1.20% for Class A, Class B, Class C and Class I, respectively, multiplied by the average account value over the period, multiplied by number of days in most recent fiscal half-year/365 or 366 (to reflect the one-half year period).

International Fund

9

Fund’s investments

F I N A N C I A L  S T A T E M E N T S

Securities owned by the Fund on 10-31-06

This schedule is divided into three main categories: common stocks, warrants and short-
term investments. The common stocks and warrants are further broken down by country.
Short-term investments, which represent the Fund’s cash position, are listed last.

Issuer	Shares	Value
Common stocks 96.51%		$116,734,676
(Cost $97,820,113)
Canada 1.45%		1,750,957
Suncor Energy, Inc. (Integrated Oil & Gas)	14,600	1,123,879
Teck Cominco Ltd. (Class B) (Diversified Metals & Mining)	8,500	627,078
China 2.22%		2,690,187
Foxconn International Holdings Ltd. (Communications Equipment) (I)	284,000	943,594
Industrial & Commercial Bank of China (Diversified Banks) (I)	2,969,000	1,327,993
Suntech Power Holding Co., Ltd., American Depositary Receipt (ADR)
(Electrical Components & Equipment) (I)	16,100	418,600
France 12.51%		15,127,995
AXA (Multi-Line Insurance)	69,675	2,654,552
BNP Paribas SA (Diversified Banks)	21,930	2,411,370
Lafarge SA (Construction Materials)	18,993	2,552,653
Silicon-On-Insulator Technologies (Semiconductors) (I)	61,834	1,831,776
Total SA (Integrated Oil & Gas)	27,128	1,836,847
Vallourec SA (Industrial Machinery)	4,304	1,071,215
Veolia Environnment SA (Multi-Utilities)	45,235	2,769,582
Germany 5.72%		6,916,031
Bayerische Motoren Werke (BMW) AG
(Automobile Manufacturers)	18,433	1,058,478
Hannover Rueckversicherung AG (Reinsurance)	33,915	1,439,307
Henkel KGaA (Household Products)	13,946	1,866,328
Puma AG Rudolf Dassler Sport (Footwear)	2,561	909,623
Solarworld AG (Electrical Components & Equipment)	8,894	479,616
Stada Arzneimittel AG (Pharmaceuticals)	24,640	1,162,679
Hong Kong 2.65%		3,203,414
AAC Acoustic Technology Holdings, Inc.
(Communications Equipment) (I)	742,000	862,142
Hutchison Telecommunications International Ltd.
(Wireless Telecommunication Services) (I)	1,216,000	2,341,272
Hungary 1.10%		1,335,053
MOL Magyar Olaj-es Gazipari Rt. (Integrated Oil & Gas)	13,424	1,335,053

See notes to financial statements

International Fund

10

F I N A N C I A L  S T A T E M E N T S

Issuer	Shares	Value
Ireland 2.93%		$3,546,276
Bank of Ireland (Diversified Banks)	64,610	1,301,290
C&C Group Plc (Distillers & Vintners)	135,093	2,244,986
Italy 2.69%		3,257,856
San Paolo IMI SpA (Diversified Banks)	50,677	1,082,123
UniCredito Italiano SpA (Diversified Banks)	262,456	2,175,733
Japan 24.69%		29,859,360
Aoyama Trading Co., Ltd. (Apparel Retail)	16,600	508,677
ASICS Corp. (Footwear)	94,000	1,257,292
Calsonic Kansei Corp. (Auto Parts & Equipment)	126,000	818,454
Chugai Pharmaceutical Co., Ltd. (Pharmaceuticals)	63,000	1,290,598
Fuji Electric Holdings Co., Ltd. (Electrical Components & Equipment)	237,000	1,286,603
Haseko Corp. (Homebuilding) (I)	397,000	1,362,247
Isetan Co., Ltd. (Department Stores)	85,300	1,499,876
Japan Steel Works Ltd. (The) (Industrial Machinery)	80,000	534,676
Japan Tobacco, Inc. (Tobacco)	544	2,368,145
Mitsubishi Estate Co., Ltd. (Real Estate Management & Development)	94,000	2,246,596
Mitsubishi UFJ Financial Group, Inc. (Diversified Banks)	160	2,007,597
Mitsui & Co., Ltd. (Trading Companies & Distributors)	70,000	954,206
Nippon Electric Glass Co., Ltd. (Electronic Equipment Manufacturers)	71,000	1,527,208
Nitori Co., Ltd. (Homefurnishing Retail)	25,030	1,012,694
Sumitomo Mitsubishi Silicon Corp. (Semiconductors)	28,600	2,031,087
Sumitomo Mitsui Financial Group, Inc. (Diversified Banks)	330	3,605,480
Toyota Motor Corp. (Automobile Manufacturers)	51,000	3,016,773
Uni-Charm Corp. (Household Products)	25,100	1,394,742
Yakult Honsha Co., Ltd. (Packaged Foods & Meats)	42,400	1,136,409
Luxembourg 3.43%		4,152,882
Millicom International Cellular SA
(Wireless Telecommunication Services) (I)	36,400	1,815,632
Stolt Offshore SA (Oil & Gas Equipment & Services) (I)	77,200	1,395,654
Tenaris SA, ADR (Oil & Gas Equipment & Services)	24,400	941,596
Mexico 1.28%		1,548,317
Fomento Economico Mexicano SA de CV (Soft Drinks)	26,100	252,671
Fomento Economico Mexicano SA de CV, ADR (Soft Drinks)	13,400	1,295,646
Netherlands 1.02%		1,234,229
Koninklijke (Royal) KPN NV (Integrated
Telecommunication Services)	92,359	1,234,229
Norway 1.88%		2,269,487
Telenor ASA (Integrated Telecommunication Services)	106,200	1,676,385
TGS Nopec Geophysical Co. ASA (Oil & Gas Equipment & Services) (I)	33,300	593,102
Portugal 1.03%		1,247,320
Banco Espirito Santo SA (Diversified Banks)	78,684	1,247,320

See notes to financial statements

International Fund

11

F I N A N C I A L  S T A T E M E N T S

Issuer	Shares	Value
Singapore 1.93%		$2,340,506
DBS Group Holdings Ltd. (Diversified Banks)	124,000	1,624,506
SembCorp Marine Ltd. (Construction & Farm Machinery & Heavy Trucks)	326,000	716,000
South Korea 2.08%		2,514,148
Daewoo Shipbuilding & Marine Engineering Co., Ltd.
(Construction & Farm Machinery & Heavy Trucks)	42,150	1,355,492
Kookmin Bank, ADR (Diversified Banks)	14,600	1,158,656
Sweden 1.23%		1,492,010
Modern Times Group MTG AB (B Shares) (Broadcasting & Cable TV)	25,900	1,492,010
Switzerland 14.54%		17,583,589
ABB Ltd. (Heavy Electrical Equipment)	200,804	2,986,593
Adecco SA (Human Resource & Employment Services)	26,399	1,631,035
Compagnie Financiere Richemont AG (Apparel, Accessories &
Luxury Goods)	25,852	1,279,246
Nestle SA (Packaged Foods & Meats)	7,662	2,617,960
Panalpina Welttransport Holding AG (Air Freight & Logistics)	13,911	1,660,798
Roche Holding AG (Pharmaceuticals)	16,756	2,932,654
Swiss Re (Reinsurance)	19,183	1,573,072
UBS AG (Diversified Capital Markets)	48,586	2,902,231
Taiwan 0.01%		6,299
United Microelectronics Corp., ADR (Semiconductors)	2,079	6,299
United Kingdom 11.50%		13,908,612
ARM Holdings Plc (Semiconductors)	641,730	1,441,189
AstraZeneca Plc (Pharmaceuticals)	38,625	2,282,221
Barclays Plc (Diversified Banks)	146,487	1,976,666
British American Tobacco Plc (Tobacco)	51,816	1,412,225
HSBC Holdings Plc (Diversified Banks)	155,954	2,956,587
International Power Plc (Independent Power Producers &
Energy Traders)	186,669	1,191,792
Scottish & Newcastle Plc (Brewers)	113,715	1,223,220
Shire Plc (Pharmaceuticals)	78,097	1,424,712
United States 0.62%		750,148
Southern Copper Corp. (Diversified Metals & Mining)	14,600	750,148
Issuer	Shares	Value
Warrants 2.04%		$2,474,317
(Cost $2,225,172)
India 0.81%		983,917
Bharti Tele-Ventures Ltd.
(Integrated Telecommunication Services) (B)(I)(R)	83,368	983,917
Taiwan 1.23%		1,490,400
Hon Hai Precision Industry Co., Ltd.
(Electronic Equipment Manufacturers) (I)(R)	230,000	1,490,400

See notes to financial statements

International Fund

12

F I N A N C I A L  S T A T E M E N T S

	Interest	Par value
Issuer, description, maturity date	rate	(000)	Value
Short-term investments 2.07%			$2,502,000
(Cost $2,502,000)
Joint Repurchase Agreement 2.07%			2,502,000
Investment in a joint repurchase agreement transaction
with Morgan Stanley — Dated 10-31-06 due 11-1-06
(secured by U.S. Treasury Inflation Indexed Bond 3.375%
due 4-15-32)	5.270%	$2,502	2,502,000
Total investments (cost $102,547,285) 100.62%			$121,710,993
Other assets and liabilities, net (0.62%)			($755,190)
Total net assets 100.00%			$120,955,803

(B) This security is fair valued in good faith under procedures established by the Board of Trustees. This security amounted to $983,917 or 0.81% of the Fund’s net assets as of October 31, 2006.

(I) Non-income-producing security.

(R) Equity-linked warrant.

The percentage shown for each investment category is the total value of that category as a percentage of the net assets of the Fund.

See notes to financial statements

International Fund

13

Financial statements

F I N A N C I A L  S T A T E M E N T S

Statement of assets and liabilities 10-31-06

This Statement of Assets and Liabilities is the Fund’s balance sheet. It shows the value
of what the Fund owns, is due and owes. You’ll also find the net asset value and the
maximum offering price per share.

Assets
Investments at value (cost $102,547,285)	$121,710,993
Foreign cash, at value (cost $826,341)	826,503
Receivable for investments sold	2,245,936
Receivable for shares sold	147,433
Dividends and interest receivable	142,129
Other assets	11,358
Total assets	125,084,352
Liabilities
Due to custodian	813,835
Payable for investments purchased	2,916,174
Payable for shares repurchased	157,709
Payable to affiliates
Management fees	92,334
Distribution and service fees	7,761
Other	31,269
Other payables and accrued expenses	109,467
Total liabilities	4,128,549
Net assets
Capital paid-in	150,341,974
Accumulated net realized loss on investments
and foreign currency transactions	(48,531,848)
Net unrealized appreciation of investments and translation
of assets and liabilities in foreign currencies	19,158,512
Accumulated net investment loss	(12,835)
Net assets	$120,955,803
Net asset value per share
Based on net asset values and shares outstanding — the Fund has an
unlimited number of shares authorized with no par value
Class A ($91,727,121 ÷ 10,075,651 shares)	$9.10
Class B ($24,012,387 ÷ 2,909,239 shares)	$8.25
Class C ($5,102,206 ÷ 617,842 shares)	$8.26
Class I ($114,089 ÷ 12,003 shares)	$9.51
Maximum offering price per share
Class A1 ($9.10 ÷ 95%)	$9.58

¹ On single retail sales of less than $50,000. On sales of $50,000 or more and on group sales the offering price is reduced.

See notes to financial statements

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14

F I N A N C I A L  S T A T E M E N T S

Statement of operations For the year ended 10-31-06.

This Statement of Operations summarizes the Fund’s investment income earned
and expenses incurred in operating the Fund. It also shows net gains (losses) for
the period stated.

Investment income
Dividends (net of foreign withholding taxes of $180,936)	$1,825,173
Interest	103,714
Total investment income	1,928,887
Expenses
Investment management fees (Note 2)	1,050,003
Distribution and service fees (Note 2)	565,229
Class A, B and C transfer agent fees (Note 2)	454,826
Class I transfer agent fees (Note 2)	724
Accounting and legal services fees (Note 2)	22,053
Compliance fees	3,495
Custodian fees	90,520
Blue sky fees	51,471
Professional fees	50,577
Printing	37,913
Trustees’ fees	6,108
Interest	2,437
Miscellaneous	25,146
Total expenses	2,360,502
Less expense reductions (Note 2)	(15,335)
Net expenses	2,345,167
Net investment loss	(416,280)
Realized and unrealized gain (loss)
Net realized gain (loss) on
Investments	19,588,323
Foreign currency transactions	(318,819)
Change in net unrealized appreciation (depreciation) of
Investments	7,339,247
Translation of assets and liabilities in foreign currencies	(4,864)
Net realized and unrealized gain	26,603,887
Increase in net assets from operations	$26,187,607

See notes to financial statements

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15

F I N A N C I A L  S T A T E M E N T S

Statement of changes in net assets

These Statements of Changes in Net Assets show how the value of the Fund’s net assets
has changed during the last two periods. The difference reflects earnings less expenses,
any investment gains and losses, distributions, if any, paid to shareholders and the net of
Fund share transactions.

	Year	Year
	ended	ended
	10-31-05	10-31-06
Increase (decrease) in net assets
From operations
Net investment loss	($442,075)	($416,280)
Net realized gain	14,558,323	19,269,504
Change in net unrealized appreciation (depreciation)	2,830,230	7,334,383
Increase in net assets resulting from operations	16,946,478	26,187,607
Distributions to shareholders
From net realized gain
Class A	(1,112,572)	(7,182,340)
Class B	(483,477)	(2,506,385)
Class C	(70,732)	(445,786)
Class I	(22,383)	(134,042)
	(1,689,164)	(10,268,553)
From Fund share transactions	(7,706,210)	3,034,543
Net assets
Beginning of period	94,451,102	102,002,206
End of period1	$102,002,206	$120,955,803

¹ Includes accumulated net investment loss of $12,835 and $12,835, respectively.

See notes to financial statements

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16

F I N A N C I A L  S T A T E M E N T S

Financial highlights

The Financial highlights show how the Fund’s net asset value for a share has changed
since the end of the previous period.

CLASS A SHARES
Period ended	10-31-02	10-31-03	10-31-04	10-31-05	10-31-06
Per share operating performance
Net asset value, beginning of period	$6.18	$5.10	$6.21	$6.78	$7.94
Net investment loss1	(0.04)	(0.04)	(0.02)	(0.02)	(0.02)
Net realized and unrealized
gain (loss) on investments	(1.04)	1.15	0.59	1.30	1.96
Total from investment operations	(1.08)	1.11	0.57	1.28	1.94
Less distributions
From net realized gain	—	—	—	(0.12)	(0.78)
Net asset value, end of period	$5.10	$6.21	$6.78	$7.94	$9.10
Total return2,3 (%)	(17.48)	21.76	9.18	19.14	26.61
Ratios and supplemental data
Net assets, end of period
(in millions)	$6	$62	$64	$73	$92
Ratio of expenses to average
net assets (%)	2.38	2.45	2.04	2.08	1.80
Ratio of gross expenses to average
net assets4 (%)	4.43	3.00	2.07	2.12	1.81
Ratio of net investment loss
to average net assets (%)	(0.68)	(0.63)	(0.27)	(0.24)	(0.18)
Portfolio turnover (%)	2285	2165	201	176	124

See notes to financial statements

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17

F I N A N C I A L  S T A T E M E N T S

Financial highlights

CLASS B SHARES
Period ended	10-31-02	10-31-03	10-31-04	10-31-05	10-31-06
Per share operating performance
Net asset value, beginning of period	$5.86	$4.81	$5.81	$6.30	$7.31
Net investment loss1	(0.08)	(0.07)	(0.06)	(0.07)	(0.07)
Net realized and unrealized
gain (loss) on investments	(0.97)	1.07	0.55	1.20	1.79
Total from investment operations	(1.05)	1.00	0.49	1.13	1.72
Less distributions
From net realized gain	—	—	—	(0.12)	(0.78)
Net asset value, end of period	$4.81	$5.81	$6.30	$7.31	$8.25
Total return2,3 (%)	(17.92)	20.79	8.43	18.20	25.81
Ratios and supplemental data
Net assets, end of period
(in millions)	$5	$30	$26	$24	$24
Ratio of expenses to average
net assets (%)	3.08	3.15	2.74	2.78	2.50
Ratio of gross expenses to average
net assets4 (%)	5.13	3.70	2.77	2.82	2.51
Ratio of net investment loss
to average net assets (%)	(1.38)	(1.28)	(0.98)	(0.97)	(0.88)
Portfolio turnover (%)	2285	2165	201	176	124

See notes to financial statements

International Fund

18

F I N A N C I A L  S T A T E M E N T S

Financial highlights

CLASS C SHARES
Period ended	10-31-02	10-31-03	10-31-04	10-31-05	10-31-06
Per share operating performance
Net asset value, beginning of period	$5.87	$4.81	$5.81	$6.30	$7.32
Net investment loss1	(0.08)	(0.06)	(0.06)	(0.07)	(0.07)
Net realized and unrealized
gain (loss) on investments	(0.98)	1.06	0.55	1.21	1.79
Total from investment operations	(1.06)	1.00	0.49	1.14	1.72
Less distributions
From net realized gain	—	—	—	(0.12)	(0.78)
Net asset value, end of period	$4.81	$5.81	$6.30	$7.32	$8.26
Total return2,3 (%)	(18.06)	20.79	8.43	18.36	25.79
Ratios and supplemental data
Net assets, end of period
(in millions)	$1	$3	$4	$4	$5
Ratio of expenses to average
net assets (%)	3.08	3.15	2.73	2.78	2.50
Ratio of gross expenses to average
net assets4 (%)	5.13	3.70	2.76	2.82	2.51
Ratio of net investment loss
to average net assets (%)	(1.38)	(1.11)	(0.96)	(1.00)	(0.88)
Portfolio turnover (%)	2285	2165	201	176	124

See notes to financial statements

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19

F I N A N C I A L  S T A T E M E N T S

Financial highlights

CLASS I SHARES
Period ended	10-31-026	10-31-03	10-31-04	10-31-05	10-31-06
Per share operating performance
Net asset value, beginning of period	$6.18	$5.12	$6.30	$6.94	$8.19
Net investment income (loss)1	(0.01)	0.03	0.04	0.04	0.07
Net realized and unrealized
gain (loss) on investments	(1.05)	1.15	0.60	1.33	2.03
Total from investment operations	(1.06)	1.18	0.64	1.37	2.10
Less distributions
From net realized gain	—	—	—	(0.12)	(0.78)
Net asset value, end of period	$5.12	$6.30	$6.94	$8.19	$9.51
Total return2 (%)	(17.15)3,7	23.053	10.16	20.003	27.87
Ratios and supplemental data
Net assets, end of period
(in millions)	$1	$1	$1	$1	$08
Ratio of expenses to average
net assets (%)	2.049	1.60	1.17	1.32	1.18
Ratio of gross expenses to average
net assets (%)	4.094,9	2.154	1.17	1.334	1.18
Ratio of net investment income
(loss) to average net assets (%)	(0.34)9	0.58	0.60	0.51	0.82
Portfolio turnover (%)	2285	2165	201	176	124

¹ Based on the average of the shares outstanding.

² Assumes dividend reinvestment and does not reflect the effect of sales charges.

³ Total returns would have been lower had certain expenses not been reduced during the periods shown.

⁴ Does not take into consideration expense reductions during the periods shown.

⁵ Excludes merger activity.

⁶ Class I shares began operations on 3-1-02.

⁷ Not annualized.

⁸ Less than $500,000.

⁹ Annualized.

See notes to financial statements

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20

Notes to financial statements

Note 1 Accounting policies

John Hancock International Fund (the “Fund”) is a diversified series of John Hancock Investment Trust III (the “Trust”), an open-end management investment company registered under the Investment Company Act of 1940 (the “1940 Act”), as amended. The investment objective of the Fund is to achieve long-term growth of capital.

The Trustees have authorized the issuance of multiple classes of shares of the Fund, designated as Class A, Class B, Class C and Class I shares. The shares of each class represent an interest in the same portfolio of investments of the Fund and have equal rights as to voting, redemptions, dividends and liquidation, except that certain expenses, subject to the approval of the Trustees, may be applied differently to each class of shares in accordance with current regulations of the Securities and Exchange Commission and the Internal Revenue Service. Shareholders of a class that bears distribution and service expenses under the terms of a distribution plan have exclusive voting rights to that distribution plan. Class B shares will convert to Class A shares eight years after purchase.

Significant accounting policies of the Fund
are as follows:

Valuation of investments

Securities in the Fund’s portfolio are valued on the basis of market quotations, valuations provided by independent pricing services or, if quotations are not readily available, or the value has been materially affected by events occurring after the close of a foreign market, at fair value as determined in good faith in accordance with procedures approved by the Trustees. Short-term debt investments which have a remaining maturity of 60 days or less may be valued at amortized cost, which approximates market value. All portfolio transactions initially expressed in terms of foreign currencies have been translated into U.S. dollars as described in “Foreign currency translation” below.

Joint repurchase agreement

Pursuant to an exemptive order issued by the Securities and Exchange Commission, the Fund, along with other registered investment companies having a management contract with John Hancock Advisers, LLC (the “Adviser”), a wholly owned subsidiary of John Hancock Financial Services, Inc., a subsidiary of Manulife Financial Corporation (“MFC”), may participate in a joint repurchase agreement transaction. Aggregate cash balances are invested in one or more large repurchase agreements, whose underlying securities are obligations of the U.S. government and/or its agencies. The Fund’s custodian bank receives delivery of the underlying securities for the joint account on the Fund’s behalf. The Adviser is responsible for ensuring that the agreement is fully collateralized at all times.

Foreign currency translation

All assets or liabilities initially expressed in terms of foreign currencies are translated into U.S. dollars based on London currency exchange quotations as of 4:00 p.m., London time, on the date of any determination of the net asset value of the Fund. Transactions affecting statement of operations accounts and net realized gain (loss) on investments are translated at the rates prevailing at the dates of the transactions.

The Fund does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from the fluctuations arising from changes in market prices of securities held. Such fluctuations are included with the net realized and unrealized gain or loss from investments.

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21

Reported net realized foreign currency exchange gains or losses arise from sales of foreign currency, currency gains or losses realized between the trade and settlement dates on securities transactions, and the difference between the amounts of dividends, interest and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign currency exchange gains and losses arise from changes in the value of assets and liabilities, other than investments in securities, resulting from changes in the exchange rates.

Investment transactions

Investment transactions are recorded as of the date of purchase, sale or maturity. Net realized gains and losses on sales of investments are determined on the identified cost basis. Capital gains realized on some foreign securities are subject to foreign taxes, which are accrued as applicable.

Class allocations

Income, common expenses and realized and unrealized gains (losses) are determined at the fund level and allocated daily to each class of shares based on the appropriate net asset value of the respective classes. Distribution and service fees, if any, and transfer agent fees for Class I shares, are calculated daily at the class level based on the appropriate net asset value of each class and the specific expense rate(s) applicable to each class.

Expenses

The majority of expenses are directly identifiable to an individual fund. Expenses that are not readily identifiable to a specific fund are allocated in such a manner as deemed equitable, taking into consideration, among other things, the nature and type of expense and the relative sizes of the funds.

Bank borrowings

The Fund is permitted to have bank borrowings for temporary or emergency purposes, including the meeting of redemption requests that otherwise might require the untimely disposition of securities. The Fund has entered into a syndicated line of credit agreement with various banks. This agreement enables the Fund to participate, with other funds managed by the Adviser, in an unsecured line of credit with banks, which permits borrowings of up to $150 million, collectively. Interest is charged to each fund based on its borrowing. In addition, a commitment fee is charged to each fund based on the average daily unused portion of the line of credit, and is allocated among the participating funds. The Fund had no borrowing activity under the line of credit during the year ended October 31, 2006.

Equity-linked warrants

The Fund may buy and sell equity-linked warrants. The Fund purchases the equity-linked warrants from a broker, who in turn purchases the shares in the local market and issues a call warrant hedged on the underlying holding. If the Fund exercises its call and closes its position, the shares are sold and the warrant redeemed with the proceeds. Each warrant represents one share of the underlying stock, therefore the price, performance and liquidity of the warrant are all directly linked to the underlying stock. The warrants can be redeemed for 100% of the value of the underlying stock, less transaction costs. Equity-linked warrants are subject to risks related to the counterparty’s ability to perform under the contract, and to the market risk of the underlying holding. The Fund may also suffer losses if it is unable to sell outstanding equity-linked warrants or reduce its exposure through offsetting transactions.

Forward foreign currency exchange contracts

The Fund may enter into forward foreign currency exchange contracts as a hedge against the effect of fluctuations in currency exchange rates. A forward foreign currency exchange contract involves an obligation to purchase or sell a specific currency at a future date at a set price. The aggregate principal amounts of the contracts are marked to market daily at the applicable foreign currency exchange rates. Any resulting unrealized gains and losses are included in the determination of the Fund’s daily net asset value. The Fund records realized gains and losses at the time the forward foreign currency exchange contracts are closed out. Risks may arise upon entering these contracts from the potential inability of counterparties to

International Fund

22

meet the terms of the contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. These contracts involve market or credit risk in excess of the unrealized gain or loss reflected in the Fund’s Statement of Assets and Liabilities.

The Fund may also purchase and sell forward contracts to facilitate the settlement of foreign currency denominated portfolio transactions, under which it intends to take delivery of the foreign currency. Such contracts normally involve no market risk if they are offset by the currency amount of the underlying transactions.

The Fund had no open forward foreign currency exchange contracts on October 31, 2006.

Federal income taxes

The Fund qualifies as a “regulated investment company” by complying with the applicable provisions of the Internal Revenue Code and will not be subject to federal income tax on taxable income that is distributed to shareholders. Therefore, no federal income tax provision is required. For federal income tax purposes, the Fund has $63,646,226 of a capital loss carryforward available, to the extent provided by regulations, to offset future net realized capital gains. To the extent that such carryforward is used by the Fund, no capital gain distributions will be made. The loss carryforward expires as follows: October 31, 2007 — $281,698, October 31, 2008 — $45,512,568, October 31, 2009 — $13,925,126 and October 31, 2010 — $3,926,834. Capital loss carryforward utilized for the year ended October 31, 2006 amounted to $3,710,589. Availability of a certain amount of the carryforwards, which were acquired in a merger on June 7, 2002, May 9, 2003 and on September 26, 2003, may be limited in a given year.

New accounting pronouncements

In June 2006, Financial Accounting Standards Board (“FASB”) Interpretation No. 48, Accounting for Uncertainty in Income Taxes (the “Interpretation”) was issued, and is effective for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. The Interpretation prescribes a minimum threshold for financial statement recognition of the benefit of a tax position taken or expected to be taken in a tax return, and requires certain expanded disclosures. Management is currently evaluating the application of the Interpretation of the Fund, and has not at this time quantified the impact, if any, resulting from adoption of the Interpretation on the Fund’s financial statements.

In September 2006, FASB Standard No. 157, Fair Value Measurements (the “FAS 157”) was issued, and is effective for fiscal years beginning after November 15, 2007. FAS 157 defines fair value, establishing a framework for measuring fair value and expands disclosure about fair value measurements. Management is currently evaluating the application of FAS 157 to the Fund, and its impact, if any, resulting from the adoption of FAS 157 on the Fund’s financial statements.

Dividends, interest and distributions

Dividend income on investment securities is recorded on the ex-dividend date or, in the case of some foreign securities, on the date thereafter when the Fund identifies the dividend. Interest income on investment securities is recorded on the accrual basis. Foreign income may be subject to foreign withholding taxes, which are accrued as applicable.

The Fund records distributions to shareholders from net investment income and net realized gains, if any, on the ex-dividend date. During the year ended October 31, 2005, the tax character of distributions paid was as follows: long-term capital gain: $1,689,164. During the year ended October 31, 2006, the tax character of distributions paid was as follows: ordinary income $3,501,979 and long-term capital gain $6,766,574. Distributions paid by the Fund with respect to each class of shares are calculated in the same manner, at the same time and are in the same amount, except for the effect of expenses that may be applied differently to each class.

As of October 31, 2006, the components of distributable earnings on a tax basis included $6,890,063 of undistributed ordinary income and $8,239,924 of undistributed long-term gain.

International Fund

23

Such distributions and distributable earnings, on a tax basis, are determined in conformity with income tax regulations, which may differ from accounting principles generally accepted in the United States of America. Distributions in excess of tax basis earnings and profits, if any, are reported in the Fund’s financial statements as a return of capital.

Use of estimates

The preparation of these financial statements, in accordance with accounting principles generally accepted in the United States of America, incorporates estimates made by management in determining the reported amount of assets, liabilities, revenues and expenses of the Fund. Actual results could differ from these estimates.

Note 2
Management fee and transactions with
affiliates and others

The Fund has an investment management contract with the Adviser. Under the investment management contract, the Fund pays a monthly management fee to the Adviser equivalent, on an annual basis, to the sum of: (a) 0.90% of the first $100,000,000 of the Fund’s average daily net asset value; (b) 0.80% of the next $200,000,000; (c) 0.75% of the next $200,000,000 and (d) 0.625% of the Fund’s average daily net asset value in excess of $500,000,000. The Adviser has a subadvisory agreement with Nicholas-Applegate Capital Management LP. The Fund is not responsible for payment of the subadvisory fees.

Effective December 31, 2005, the investment management teams of the Adviser were reorganized into Sovereign Asset Management LLC (“Sovereign”), a wholly owned indirect subsidiary of John Hancock Life Insurance Company (“JHLICO”), a subsidiary of MFC. The Adviser remains the principal advisor on the Fund and Sovereign acts as subadviser under the supervision of the Adviser. The restructuring did not have an impact on the Fund, which continues to be managed using the same investment philosophy and process. The Fund is not responsible for payment of the subadvisory fees.

Effective October 1, 2006, Sovereign changed its name to MFC Global Investment Management (U.S.), LLC.

The Adviser has agreed to limit the Fund’s total expenses, excluding the distribution and service fees and transfer agent fees, to 1.27% of the Fund’s average daily net asset value, on an annual basis, and net operating expenses for Class A, Class B and Class C shares to 2.35%, 3.05% and 3.05%, respectively, at least until February 28, 2008. There were no expense reductions related to the Fund’s total expense limitation for the year ended October 31, 2006. The Adviser reserves the right to terminate these limitations in the future.

The Fund has a Distribution Agreement with John Hancock Funds, LLC (“JH Funds”), a wholly owned subsidiary of the Adviser. The Fund has adopted Distribution Plans with respect to Class A, Class B and Class C, pursuant to Rule 12b-1 under the 1940 Act, as amended, to reimburse JH Funds for the services it provides as distributor of shares of the Fund. Accordingly, the Fund makes monthly payments to JH Funds at an annual rate not to exceed 0.30%, 1.00% and 1.00% of average daily net asset value of Class A, Class B and Class C, respectively. A maximum of 0.25% of such payments may be service fees, as defined by the Conduct Rules of the National Association of Securities Dealers. Under the Conduct Rules, curtailment of a portion of the Fund’s 12b-1 payments could occur under certain circumstances.

Expenses under the agreement described above for the year ended October 31, 2006 were as follows:

	Distribution and
Share class	service fees
Class A	$260,482
Class B	255,811
Class C	48,936
Total	$565,229

Class A shares are assessed up-front sales charges. During the year ended October 31, 2006, JH Funds received net up-front sales charges of $124,988 with regard to sales of Class A shares. Of this amount, $19,191 was

International Fund

24

retained and used for printing prospectuses, advertising, sales literature and other purposes, $90,961 was paid as sales commissions to unrelated broker-dealers and $14,836 was paid as sales commissions to sales personnel of Signator Investors, Inc. (“Signator Investors”), a related broker-dealer. The Adviser’s indirect parent, JHLICO is the indirect sole shareholder of Signator Investors.

Class B shares that are redeemed within six years of purchase are subject to a contingent deferred sales charge (“CDSC”) at declining rates, beginning at 5.00% of the lesser of the current market value at the time of redemption or the original purchase cost of the shares being redeemed. Class C shares that are redeemed within one year of purchase are subject to a CDSC at a rate of 1.00% of the lesser of the current market value at the time of redemption or the original purchase cost of the shares being redeemed. Proceeds from the CDSCs are paid to JH Funds and are used, in whole or in part, to defray its expenses for providing distribution-related services to the Fund in connection with the sale of Class B and Class C shares. During the year ended October 31, 2006, CDSCs received by JH Funds amounted to $58,376 for Class B shares and $9,855 for Class C shares.

The Fund has a transfer agent agreement with John Hancock Signature Services, Inc., (“Signature Services”), an indirect subsidiary of JHLICO. For Class A, Class B and Class C shares, the Fund pays a monthly transfer agent fee at an annual rate of 0.05% of each class’s average daily net asset value, plus a fee based on the number of shareholder accounts and reimbursement for certain out-of-pocket expenses, aggregated and allocated to each class on the basis of its relative net asset value. For Class I shares, the Fund pays a monthly transfer agent fee at a total annual rate of 0.05% of Class I average daily net asset value. Signature Services agreed to limit Class A, Class B and Class C shares transfer agent fee to 0.78% of each class’s average daily net asset value, until June 30, 2006. Signature Services also agreed to voluntarily reduce the Fund’s asset-based portion of the transfer agent fee for Class A, Class B and Class C shares, if the tota l transfer agent fee exceeded the median transfer agency fee for comparable mutual funds by greater than 0.05% . Accordingly, the transfer agent expense for Class A, Class B and Class C shares was reduced by $15,335 for the year ended October 31, 2006. Signature Services terminated this reimbursement agreement June 30, 2006.

Effective July 1, 2006, the transfer agent has contractually limited transfer agent fees by implementing a transfer agent fee cap of 0.40% until June 30, 2007. There were no expense reductions under this limitation during the year ended October 31, 2006.

The Fund has an agreement with the Adviser and affiliates to perform necessary tax, accounting and legal services for the Fund. The compensation for the year amounted to $22,053. The Fund also paid the adviser the amount of $562 for certain publishing services, included in the printing fees. The Fund reimbursed JHLICO for certain compliance costs, included in the Fund’s Statement of Operations.

Mr. James R. Boyle is Chairman of the Adviser, as well as affiliated Trustee of the Fund, and is compensated by the Adviser and/or its affiliates. The compensation of unaffiliated Trustees is borne by the Fund. The unaffiliated Trustees may elect to defer, for tax purposes, their receipt of this compensation under the John Hancock Group of Funds Deferred Compensation Plan. The Fund makes investments into other John Hancock funds, as applicable, to cover its liability for the deferred compensation. Investments to cover the Fund’s deferred compensation liability are recorded on the Fund’s books as an other asset. The deferred compensation liability and the related other asset are always equal and are marked to market on a periodic basis to reflect any income earned by the investments, as well as any unrealized gains or losses. The Deferred Compensation Plan investments had no impact on the operations of the Fund.

International Fund

25

Note 3
Fund share transactions

This listing illustrates the number of Fund shares sold, reinvested and repurchased during the last two periods, along with the corresponding dollar value.

	Year ended 10-31-05		Year ended 10-31-06
	Shares	Amount	Shares	Amount
Class A shares
Sold	1,907,087	$14,310,047	2,254,177	$19,173,017
Issued in reorganization	153,373	1,067,479	928,761	6,909,982
Repurchased	(2,248,267)	(16,706,148)	(2,315,885)	(19,644,913)
Net increase (decrease)	(187,807)	($1,328,622)	867,053	$6,438,086
Class B shares
Sold	735,091	$5,111,257	886,215	$6,910,240
Issued in reorganization	71,179	459,815	353,037	2,397,118
Repurchased	(1,661,206)	(11,394,043)	(1,549,859)	(11,909,920)
Net decrease	(854,936)	($5,822,971)	(310,607)	($2,602,562)
Class C shares
Sold	216,694	$1,484,170	221,135	$1,717,101
Issued in reorganization	10,744	69,404	64,902	440,684
Repurchased	(291,681)	(1,993,970)	(208,540)	(1,618,900)
Net increase (decrease)	(64,243)	($440,396)	77,497	$538,885
Class I shares
Sold	51,705	$398,210	115,992	$1,032,029
Repurchased	3,135	22,383	17,408	134,042
Repurchased	(71,242)	(534,814)	(290,738)	(2,505,937)
Net decrease	(16,402)	($114,221)	(157,338)	($1,339,866)
Net increase (decrease)	(1,123,388)	($7,706,210)	476,605	$3,034,543

Note 4
Investment transactions

Purchases and proceeds from sales or maturities of securities, other than short-term securities and obligations of the U.S. government, during the period ended October 31, 2006, aggregated $144,295,258 and $152,804,470, respectively.

The cost of investments owned on October 31, 2006, including short-term investments, for federal income tax purposes, was $102,562,894. Gross unrealized appreciation and depreciation of investments aggregated $20,204,296 and $1,056,197, respectively, resulting in net unrealized appreciation of $19,148,099. The difference between book basis and tax basis net unrealized appreciation of investments is attributable primarily to the tax deferral of losses on certain sales of securities.

Note 5
Reclassification of accounts

During the year ended October 31, 2006, the Fund reclassified amounts to reflect an increase in accumulated net realized loss on investments of $57,293, a decrease in accumulated net investment loss of $416,280 and a decrease in capital paid-in of $358,987. This represents the amounts necessary to report these balances on a tax basis, excluding certain temporary differences, as of October 31, 2006. Additional adjustments may be needed in subsequent reporting periods. These reclassifications, which have no impact on the net asset value of the Fund, are primarily attributable to certain differences in the computation of distributable income and capital gains under federal tax rules versus accounting principles generally accepted in the United States of America, book and tax differences in accounting expired capital loss

International Fund

26

carryforwards and certain foreign currency adjustments. The calculation of net investment loss per share in the Fund’s Financial Highlights excludes these adjustments.

International Fund

27

Auditors’ report

Report of Independent Registered Public Accounting Firm

To the Board of Trustees of John Hancock Investment Trust III
and Shareholders of John Hancock International Fund,

In our opinion, the accompanying statement of assets and liabilities, including the schedule 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 John Hancock International Fund (the “Fund”) at October 31, 2006, the results of its operations, the changes in its net assets and the financial highlights for the periods indicated, 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 Fund’s 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 audits 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, 2006 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.

PricewaterhouseCoopers LLP
Boston, Massachusetts
December 13, 2006

28

Tax information

Unaudited

For federal income tax purposes, the following information is furnished with respect to the distributions of the Fund, if any, paid during its taxable year ended October 31, 2006.

The Fund has designated distributions to shareholders of $6,766,574 as capital gain dividends.

With respect to the ordinary dividends paid by the Fund for the fiscal year ended October 31, 2006, 3.13% of the dividends qualify for the corporate dividends-received deduction.

The Fund hereby designates the maximum amount allowable of its net taxable income as qualified dividend income as provided in the Jobs and Growth Tax Relief Reconciliation Act of 2003. This amount will be reflected on Form 1099-DIV for the calendar year 2006.

Shareholders will be mailed a 2006 U.S. Treasury Department Form 1099-DIV in January 2007. This will reflect the total of all distributions that are taxable for calendar year 2006.

29

Board Consideration of and
Continuation of Investment
Advisory Agreement and
Sub-Advisory Agreement:
John Hancock International Fund

The Investment Company Act of 1940 (the “1940 Act”) requires the Board of Trustees (the “Board”) of John Hancock Investment Trust III (the “Trust”), including a majority of the Trustees who have no direct or indirect interest in the investment advisory agreement and are not “interested persons” of the Trust, as defined in the 1940 Act (the “Independent Trustees”), annually to review and consider the continuation of: (i) the investment advisory agreement (the “Advisory Agreement”) with John Hancock Advisers, LLC (the “Adviser”) and (ii) the investment sub-advisory agreement (the “Sub-Advisory Agreement”) with Nicholas-Applegate Capital Management LLC (the “Sub-Adviser”) for the John Hancock International Fund (the “Fund”). The Advisory Agreement with the Adviser and the Sub-Advisory Agreement with the Sub-Adviser are collectively referred to as the “Advisory Agreements .”

At meetings held on May 1–2 and June 5–6, 2006,¹ the Board considered the factors and reached the conclusions described below relating to the selection of the Adviser and Sub-Adviser and the continuation of the Advisory Agreements. During such meetings, the Board’s Contracts/Operations Committee and the Independent Trustees also met in executive sessions with their independent legal counsel.

In evaluating the Advisory Agreements, the Board, including the Contracts/Operations Committee and the Independent Trustees, reviewed a broad range of information requested for this purpose by the Independent Trustees, including: (i) the investment performance of the Fund relative to a category of relevant funds (the “Category”) and a peer group of comparable funds (the “Peer Group”) each selected by Morningstar Inc. (“Morningstar”), an independent provider of investment company data, for a range of periods ended December 31, 2005; (ii) advisory and other fees incurred by, and the expense ratios of, the Fund relative to a Category and a Peer Group; (iii) the advisory fees of comparable portfolios of other clients of the

Adviser and the Sub-Adviser; (iv) the Adviser’s financial results and condition, including its and certain of its affiliates’ profitability from services performed for the Fund; (v) breakpoints in the Fund’s and the Peer Group’s fees, and information about economies of scale; (vi) the Adviser’s and Sub-Adviser’s record of compliance with applicable laws and regulations, with the Fund’s investment policies and restrictions and with the applicable Code of Ethics, and the structure and responsibilities of the Adviser’s and Sub-Adviser’s compliance department; (vii) the background and experience of senior management and investment professionals and (viii) the nature, cost and character of advisory and non-investment management services provided by the Adviser and its affiliates and by the Sub-Adviser.

The Board’s review and conclusions were based on a comprehensive consideration of all information presented to the Board and not the result of any single controlling factor. It was based on performance and other information as of December 31, 2005; facts may have changed between that date and the date of this shareholders report. The key factors considered by the Board and the conclusions reached are described below.

Nature, extent and quality of services

The Board considered the ability of the Adviser and the Sub-Adviser, based on their resources, reputation and other attributes, to attract and retain qualified investment professionals, including research, advisory and supervisory personnel. The Board further considered the compliance programs and compliance records of the Adviser and Sub-Adviser. In addition, the Board took into account the administrative services provided to the Fund by the Adviser and its affiliates.

Based on the above factors, together with those referenced below, the Board concluded that, within the context of its full deliberations, the nature, extent and quality of the investment advisory services provided to the Fund by the Adviser and Sub-Adviser were sufficient to support renewal of the Advisory Agreements.

30

Fund performance

The Board considered the performance results for the Fund over various time periods ended December 31, 2005. The Board also considered these results in comparison to the performance of the Category, as well as the Fund’s Peer Group and benchmark index. Morningstar determined the Category and the Peer Group for the Fund. The Board reviewed with a representative of Morningstar the methodology used by Morningstar to select the funds in the Category and the Peer Group. The Board noted the imperfect comparability of the Peer Group.

The Board noted that the Fund’s performance during the five- and 10-year periods under review was equal to the performance of the Peer Group median and lower than the performance of the Category median, and its benchmark index — the MSCI EAFE Index. The Board also noted that the performance of the Fund for the three-year period was higher than the median of its Category and Peer Group, and was lower than the performance of its benchmark index. The Board viewed favorably that the Fund’s more recent performance during the one-year period under review was appreciably higher than the Peer Group and Category medians and its benchmark index.

Investment advisory fee and sub-advisory
fee rates and expenses

The Board reviewed and considered the contractual investment advisory fee rate payable by the Fund to the Adviser for investment advisory services (the “Advisory Agreement Rate”). The Board received and considered information comparing the Advisory Agreement Rate with the advisory fees for the Peer Group and Category. The Board noted that the Advisory Agreement Rate was equal to the median rate of the Peer Group and lower than the Category.

The Board received and considered expense information regarding the Fund’s various components, including advisory fees, distribution and fees other than advisory and distribution fees, including transfer agent fees, custodian fees and other miscellaneous fees (e.g., fees for accounting and legal services). The Board also considered peer-adjusted comparisons for the  transfer agent fees. The Board considered comparisons of these expenses to the Peer Group median. The Board also received and considered expense information regarding the Fund’s total operating expense ratio (“Gross Expense Ratio”) and total operating expense ratio after taking the fee waiver arrangement applicable to the Advisory Agreement Rate into account (“Net Expense Ratio”). The Board received and considered information comparing the Gross Expense Ratio and Net Expense Ratio of the Fund to that of the Peer Group and Category medians. The Board noted that the Fund’s Gross and Net Expense Ratios were higher than the median of its Peer Group and Category.

The Adviser also discussed the Morningstar data and rankings, and other relevant information, for the Fund. Based on the above-referenced considerations and other factors, the Board concluded that the Fund’s overall performance and expenses supported the re-approval of the Advisory Agreements.

The Board also received information about the investment sub-advisory fee rate (the “Sub-Advisory Agreement Rate”) payable by the Adviser to the Sub-Adviser for investment sub-advisory services. The Board concluded that the Sub-Advisory Agreement Rate was fair and equitable, based on its consideration of the factors described here.

Profitability

The Board received and considered a detailed profitability analysis of the Adviser based on the Advisory Agreements, as well as on other relationships between the Fund and the Adviser and its affiliates. The Board concluded that, in light of the costs of providing investment management and other services to the Fund, the profits and other ancillary benefits reported by the Adviser were not unreasonable.

The Board did not consider profitability information with respect to the Sub-Adviser, which is not affiliated with the Adviser. The Board considered that the Sub-Advisory Rate paid to the Sub-Adviser had been negotiated by the Adviser on an arm’s length basis and that the Sub-Adviser’s separate profitability from its relationship with the Fund was not a material factor in determining whether to renew the agreement.

31

Economies of scale

The Board received and considered general information regarding economies of scale with respect to the management of the Fund, including the Fund’s ability to appropriately benefit from economies of scale under the Fund’s fee structure. The Board recognized the inherent limitations of any analysis of economies of scale, stemming largely from the Board’s understanding that most of the Adviser’s costs are not specific to individual Funds, but rather are incurred across a variety of products and services.

To the extent the Board and the Adviser were able to identify actual or potential economies of scale from Fund-specific or allocated expenses, in order to ensure that any such economies continue to be reasonably shared with the Fund as its assets increase, the Adviser and the Board agreed to continue the existing breakpoints to the Advisory Agreement Rate.

Information about services to other clients

The Board also received information about the nature, extent and quality of services and fee rates offered by the Adviser and Sub-Adviser to their other clients, including other registered investment companies, institutional investors and separate accounts. The Board concluded that the Advisory Agreement Rate and the Sub-Advisory Agreement Rate were not unreasonable, taking into account fee rates offered to others by the Adviser and Sub-Adviser, respectively, after giving effect to differences in services.

Other benefits to the Adviser

The Board received information regarding potential “fall-out” or ancillary benefits received by the Adviser and its affiliates as a result of the Adviser’s relationship with the Fund. Such benefits could include, among others, benefits directly attributable to the relationship of the Adviser with the Fund and benefits potentially derived from an increase in the business of the Adviser as a result of its relationship with the Fund (such as the ability to market to shareholders other financial products offered by the Adviser and its affiliates).

The Board also considered the effectiveness of the Adviser’s, Sub-Adviser’s and Fund’s policies and procedures for complying with the requirements of the federal securities laws, including those relating to best execution of portfolio transactions and brokerage allocation.

Other factors and broader review

As discussed above, the Board reviewed detailed materials received from the Adviser and Sub-Adviser as part of the annual re-approval process. The Board also regularly reviews and assesses the quality of the services that the Fund receives throughout the year. In this regard, the Board reviews reports of the Adviser and Sub-Adviser at least quarterly, which include, among other things, fund performance reports and compliance reports. In addition, the Board meets with portfolio managers and senior investment officers at various times throughout the year.

After considering the above-described factors and based on its deliberations and its evaluation of the information described above, the Board concluded that approval of the continuation of the Advisory Agreements for the Fund was in the best interest of the Fund and its shareholders. Accordingly, the Board unanimously approved the continuation of the Advisory Agreements.

¹ The Board previously considered information about the Sub-Advisory Agreement at the September and December 2005 Board meetings in connection with the Adviser’s reorganization.

32

Trustees and Officers

This chart provides information about the Trustees and Officers who oversee
your John Hancock fund. Officers elected by the Trustees manage the day-to-day
operations of the Fund and execute policies formulated by the Trustees.

Independent Trustees
Name, age		Number of
Position(s) held with Fund	Trustee	John Hancock
Principal occupation(s) and other	of Fund	funds overseen
directorships during past 5 years	since1	by Trustee
Ronald R. Dion , Born: 1946	2005	53
Independent Chairman (since 2005); Chairman and Chief Executive Officer,
R.M. Bradley & Co., Inc.; Director, The New England Council and Massachusetts
Roundtable; Trustee, North Shore Medical Center; Director, Boston Stock
Exchange; Director, BJ’s Wholesale Club, Inc. and a corporator of the Eastern
Bank; Trustee, Emmanuel College; Director, Boston Municipal Research Bureau;
Member of the Advisory Board, Carroll Graduate School of Management at
Boston College.
James F. Carlin , Born: 1940	2005	53
Director and Treasurer, Alpha Analytical Laboratories Inc. (chemical analysis)
(since 1985); Part Owner and Treasurer, Lawrence Carlin Insurance Agency,
Inc. (since 1995); Part Owner and Vice President, Mone Lawrence Carlin
Insurance Agency, Inc. (until 2005); Director and Treasurer, Rizzo Associates
(engineering) (until 2000); Chairman and CEO, Carlin Consolidated, Inc.
(management/investments) (since 1987); Director and Partner, Proctor Carlin
& Co., Inc. (until 1999); Trustee, Massachusetts Health and Education Tax
Exempt Trust (since 1993); Director of the following: Uno Restaurant Corp.
(until 2001), Arbella Mutual (insurance) (until 2000), HealthPlan Services, Inc.
(until 1999), Flagship Healthcare, Inc. (until 1999), Carlin Insurance Agency, Inc.
(until 1999); Chairman, Massachusetts Board of Higher Education (until 1999).
Richard P. Chapman, Jr.,2 Born: 1935	1996	53
President and Chief Executive Officer, Brookline Bancorp, Inc. (lending) (since
1972); Chairman and Director, Lumber Insurance Co. (insurance) (until 2000);
Chairman and Director, Northeast Retirement Services, Inc. (retirement
administration) (since 1998); Vice Chairman, Northeastern University Board
of Trustees (since 2004).
William H. Cunningham , Born: 1944	2005	158
Former Chancellor, University of Texas System and former President of the
University of Texas, Austin, Texas; Chairman and CEO, IBT Technologies (until
2001); Director of the following: Hire.com (until 2004), STC Broadcasting, Inc.
and Sunrise Television Corp. (until 2001), Symtx, Inc. (electronic manufacturing)
(since 2001), Adorno/Rogers Technology, Inc. (until 2004), Pinnacle Foods
Corporation (until 2003), rateGenius (until 2003), Lincoln National Corporation
(insurance) (since 2006), Jefferson-Pilot Corporation (diversified life insurance
company) (until 2006), New Century Equity Holdings (formerly Billing Concepts)

33

Independent Trustees (continued)
Name, age		Number of
Position(s) held with Fund	Trustee	John Hancock
Principal occupation(s) and other	of Fund	funds overseen
directorships during past 5 years	since1	by Trustee
William H. Cunningham , Born: 1944 (continued)	2005	158
(until 2001), eCertain (until 2001), ClassMap.com (until 2001), Agile Ventures
(until 2001), AskRed.com (until 2001), Southwest Airlines, Introgen and
Viasystems Group, Inc. (electronic manufacturer) (until 2003); Advisory
Director, Interactive Bridge, Inc. (college fundraising) (until 2001); Advisory
Director, Q Investments (until 2003); Advisory Director, JPMorgan Chase Bank
(formerly Texas Commerce Bank – Austin), LIN Television (since 2002), WilTel
Communications (until 2003) and Hayes Lemmerz International, Inc.
(diversified automotive parts supply company) (since 2003).
Charles L. Ladner,2 Born: 1938	2004	158
Chairman and Trustee, Dunwoody Village, Inc. (retirement services) (until 2003);
Senior Vice President and Chief Financial Officer, UGI Corporation (public utility
holding company) (retired 1998); Vice President and Director for AmeriGas, Inc.
(retired 1998); Director of AmeriGas Partners, L.P. (gas distribution) (until 1997);
Director, EnergyNorth, Inc. (until 1995); Director, Parks and History Association
(until 2007).
John A. Moore,2 Born: 1939	1994	53
President and Chief Executive Officer, Institute for Evaluating Health Risks,
(nonprofit institution) (until 2001); Senior Scientist, Sciences International
(health research) (until 2003); Former Assistant Administrator and Deputy
Administrator, Environmental Protection Agency; Principal, Hollyhouse
(consulting) (since 2000); Director, CIIT Center for Health Science Research
(nonprofit research) (since 2002).
Patti McGill Peterson,2 Born: 1943	1994	53
Executive Director, Council for International Exchange of Scholars and Vice
President, Institute of International Education (since 1998); Senior Fellow, Cornell
Institute of Public Affairs, Cornell University (until 1998); Former President of
Wells College and St. Lawrence University; Director, Niagara Mohawk Power
Corporation (until 2003); Director, Ford Foundation, International Fellowships
Program (since 2002); Director, Lois Roth Endowment (since 2002); Director,
Council for International Educational Exchange (since 2003).
Steven R. Pruchansky, Born: 1944	2005	53
Chairman and Chief Executive Officer, Greenscapes of Southwest Florida, Inc.
(since 2000); Director and President, Greenscapes of Southwest Florida, Inc.
(until 2000); Managing Director, JonJames, LLC (real estate) (since 2001);
Director, First Signature Bank & Trust Company (until 1991); Director, Mast
Realty Trust (until 1994); President, Maxwell Building Corp. (until 1991).

34

Non-Independent Trustee3
Name, age		Number of
Position(s) held with Fund	Trustee	John Hancock
Principal occupation(s) and other	of Fund	funds overseen
directorships during past 5 years	since1	by Trustee
James R. Boyle, Born: 1959	2005	260
President, John Hancock Annuities; Executive Vice President, John Hancock
Life Insurance Company (since June, 2004); Chairman and Director, John
Hancock Advisers, LLC (the “Adviser”), John Hancock Funds, LLC and The
Berkeley Financial Group, LLC (“The Berkeley Group”) (holding company) (since
2005); President, U.S. Annuities; Senior Vice President, The Manufacturers
Life Insurance Company (U.S.A.) (until 2004).
Principal officers who are not Trustees
Name, age
Position(s) held with Fund		Officer
Principal occupation(s) and		of Fund
directorships during past 5 years		since
Keith F. Hartstein, Born: 1956		2005
President and Chief Executive Officer
Senior Vice President, Manulife Financial Corporation (since 2004); Director,
President and Chief Executive Officer, the Adviser, The Berkeley Group, John
Hancock Funds, LLC (since 2005); Director, MFC Global Investment Management
(U.S.), LLC (“MFC Global (U.S.)”) (since 2005); Director, John Hancock Signature
Services, Inc. (since 2005); President and Chief Executive Officer, John Hancock
Investment Management Services, LLC (since 2006); President and Chief Executive
Officer, John Hancock Funds II, John Hancock Funds III and John Hancock Trust;
Director, Chairman and President, NM Capital Management, Inc. (since 2005);
Chairman, Investment Company Institute Sales Force Marketing Committee
(since 2003); Director, President and Chief Executive Officer, MFC Global (U.S.)
(2005–2006); Executive Vice President, John Hancock Funds, LLC (until 2005).
Thomas M. Kinzler, Born: 1955		2006
Secretary and Chief Legal Officer
Vice President and Counsel, John Hancock Life Insurance Company (U.S.A.)
(since 2006); Secretary and Chief Legal Officer, John Hancock Funds, John
Hancock Funds II, John Hancock Funds III and John Hancock Trust (since 2006);
Vice President and Associate General Counsel, Massachusetts Mutual Life
Insurance Company (1999–2006); Secretary and Chief Legal Counsel, MML
Series Investment Fund (2000–2006); Secretary and Chief Legal Counsel,
MassMutual Institutional Funds (2000–2004); Secretary and Chief Legal Counsel,
MassMutual Select Funds and MassMutual Premier Funds (2004–2006).
Francis V. Knox, Jr., Born: 1947		2005
Chief Compliance Officer
Vice President and Chief Compliance Officer, John Hancock Investment
Management Services, LLC, the Adviser and MFC Global (U.S.) (since 2005);
Vice President and Chief Compliance Officer, John Hancock Funds II, John
Hancock Funds III and John Hancock Trust (since 2005); Vice President and
Assistant Treasurer, Fidelity Group of Funds (until 2004); Vice President and
Ethics & Compliance Officer, Fidelity Investments (until 2001).

35

Principal officers who are not Trustees (continued)
Name, age
Position(s) held with Fund	Officer
Principal occupation(s) and	of Fund
directorships during past 5 years	since
Gordon M. Shone, Born: 1956	2006
Treasurer
Treasurer, John Hancock Funds (since 2006), John Hancock Funds II, John
Hancock Funds III and John Hancock Trust (since 2005); Vice President and
Chief Financial Officer, John Hancock Trust (2003–2005); Senior Vice President,
John Hancock Life Insurance Company (U.S.A.) (since 2001); Vice President,
John Hancock Investment Management Services, Inc., John Hancock Advisers,
LLC (since 2006) and The Manufacturers Life Insurance Company (U.S.A.)
(1998–2000).
John G. Vrysen, Born: 1955	2005
Chief Financial Officer
Director, Executive Vice President and Chief Financial Officer, the Adviser, The
Berkeley Group and John Hancock Funds, LLC (since 2005); Executive Vice
President and Chief Financial Officer, John Hancock Investment Management
Services, LLC (since 2005); Vice President and Chief Financial Officer, MFC Global
(U.S.) (since 2005); Director, John Hancock Signature Services, Inc. (since 2005);
Chief Financial Officer, John Hancock Funds II, John Hancock Funds III and John
Hancock Trust (since 2005); Vice President and General Manager, Fixed Annuities,
U.S. Wealth Management (until 2005); Vice President, Operations, Manulife
Wood Logan (2000–2004).

The business address for all Trustees and Officers is 601 Congress Street, Boston, Massachusetts 02210-2805.

The Statement of Additional Information of the Fund includes additional information about members of the Board of Trustees of the Fund and is available, without charge, upon request, by calling 1-800-225-5291.

¹Each Trustee serves until resignation, retirement age or until his or her successor is elected.

²Member of Audit Committee.

³Non-Independent Trustee holds positions with the Fund’s investment adviser, underwriter and certain other affiliates.

36

For more information

The Fund’s proxy voting policies, procedures and records are available without charge,
upon request:

By phone	On the Fund’s Web site	On the SEC’s Web site
1-800-225-5291	www.jhfunds.com/proxy	www.sec.gov
Investment adviser	Custodian	Legal counsel
John Hancock Advisers, LLC	The Bank of New York	Kirkpatrick & Lockhart
601 Congress Street	One Wall Street	Nicholson Graham LLP
Boston, MA 02210-2805	New York, NY 10286	1 Lincoln Street
		Boston, MA 02110-2950
Subadviser	Transfer agent
Nicholas-Applegate Capital	John Hancock Signature	Independent registered
Management, LLC	Services, Inc.	public accounting firm
600 West Broadway	1 John Hancock Way,	PricewaterhouseCoopers LLP
San Diego, CA 92101	Suite 1000	125 High Street
Principal distributor	Boston, MA 02217-1000	Boston, MA 02110
John Hancock Funds, LLC
601 Congress Street
Boston, MA 02210-2805

The Fund’s investment objective, risks, charges and expenses are included in the prospectus and should be considered carefully before investing. For a prospectus, call your financial professional, call John Hancock Funds at 1-800-225-5291 or visit the Fund’s Web site at www.jhfunds.com. Please read the prospectus carefully before investing or sending money.

How to contact us
Internet	www.jhfunds.com
Mail	Regular mail:	Express mail:
	John Hancock	John Hancock
	Signature Services, Inc.	Signature Services, Inc.
	1 John Hancock Way, Suite 1000	Mutual Fund Image Operations
	Boston, MA 02217-1000	380 Stuart Street
		Boston, MA 02116
Phone	Customer service representatives	1-800-225-5291
	24-hour automated information	1-800-338-8080
	TDD line	1-800-554-6713

A listing of month-end portfolio holdings is available on our Web site, www.jhfunds.com. A more detailed portfolio holdings summary is available on a quarterly basis 60 days after the fiscal quarter on our Web site or upon request by calling 1-800-225-5291, or on the Securities and Exchange Commission’s Web site, www.sec.gov.

40

J O H N   H A N C O C K  F A M I L Y  O F  F U N D S

EQUITY	INTERNATIONAL
Balanced Fund	Greater China Opportunities Fund
Classic Value Fund	International Classic Value Fund
Classic Value Fund II	International Core Fund
Core Equity Fund	International Fund
Focused Equity Fund	International Growth Fund
Growth Fund
Growth Opportunities Fund	INCOME
Growth Trends Fund	Bond Fund
Intrinsic Value Fund	Government Income Fund
Large Cap Equity Fund	High Yield Fund
Large Cap Select Fund	Investment Grade Bond Fund
Mid Cap Equity Fund	Strategic Income Fund
Mid Cap Growth Fund
Multi Cap Growth Fund	Tax-Free
Small Cap Equity Fund	California Tax-Free Income Fund
Small Cap Fund	High Yield Municipal Bond Fund
Small Cap Intrinsic Value Fund	Massachusetts Tax-Free Income Fund
Sovereign Investors Fund	New York Tax-Free Income Fund
U.S. Core Fund	Tax-Free Bond Fund
U.S. Global Leaders Growth Fund
Value Opportunities Fund	Money Market
	Money Market Fund
Asset Allocation & Lifestyle	U.S. Government Cash Reserve
Allocation Core Portfolio
Allocation Growth + Value Portfolio	Closed-End
Lifestyle Aggressive Portfolio	Bank & Thrift Opportunity
Lifestyle Balanced Portfolio	Financial Trends
Lifestyle Conservative Portfolio	Income Securities
Lifestyle Growth Portfolio	Investors Trust
Lifestyle Moderate Portfolio	Patriot Global Dividend
	Patriot Preferred Dividend
Sector	Patriot Premium Dividend I
Financial Industries Fund	Patriot Premium Dividend II
Health Sciences Fund	Patriot Select Dividend
Real Estate Fund	Preferred Income
Regional Bank Fund	Preferred Income II
Technology Fund	Preferred Income III
Technology Leaders Fund	Tax-Advantaged Dividend

For more complete information on any John Hancock Fund and an Open-End fund prospectus, which includes charges and expenses, call your financial professional, or John Hancock Funds at 1-800-225-5291 for Open-End fund information and 1-800-852-0218 for Closed-End fund information. Please read the Open-End fund prospectus carefully before investing or sending money.

1-800-225-5291
1-800-554-6713 (TDD)
1-800-338-8080 EASI-Line

www.jhfunds. com

Now available:electronicdelivery
www.jhfunds. com/edelivery

This report is for the information of the shareholders of John HancockInternational Fund.

4000A 10/06
12/06

ITEM 2. CODE OF ETHICS.

As of the end of the period, October 31, 2006, the registrant has adopted a code of ethics, as defined in Item 2 of Form N-CSR, that applies to its Chief Executive Officer, Chief Financial Officer and Treasurer (respectively, the principal executive officer, the principal financial officer and the principal accounting officer, the “Senior Financial Officers”). A copy of the code of ethics is filed as an exhibit to this Form N-CSR.

ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.

Charles L. Ladner is the audit committee financial expert and is “independent”, pursuant to general instructions on Form N-CSR Item 3.

ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

(a) Audit Fees

The aggregate fees billed for professional services rendered by the principal accountant(s) for the audit of the registrant’s annual financial statements or services that are normally provided by the accountant(s) in connection with statutory and regulatory filings or engagements amounted to $82,470 for the fiscal year ended October 31, 2005 (broken out as follows: John Hancock International Fund - $37,890, John Hancock Mid Cap Growth Fund - $28,080 and John Hancock Greater China Opportunities Fund - $16,500) and $74,650 for the fiscal year ended October 31, 2006 (broken out as follows: John Hancock International Fund - $32,000, John Hancock Mid Cap Growth Fund - $23,650 and John Hancock Greater China Opportunities Fund - $19,000 ). John Hancock Greater China Opportunities Fund commenced operations on June 8, 2005. These fees were billed to the registrant and were approved by the registrant’s audit committee.

(b) Audit-Related Services

There were no audit-related fees during the fiscal year ended October 31, 2005 and fiscal year ended October 31, 2006 billed to the registrant or to the registrant's investment adviser (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by, or under common control with the adviser that provides ongoing services to the registrant ("control affiliates").

(c) Tax Fees

The aggregate fees billed for professional services rendered by the principal accountant(s) for the tax compliance, tax advice and tax planning (“tax fees”) amounted to $9,400 for the fiscal year ended October 31, 2005 (broken out as follows: John Hancock International Fund - $3,900, John Hancock Mid Cap Growth Fund - $3,000 and John Hancock Greater China Opportunities Fund - $2,500) and $9,750 for the fiscal year ended October 31, 2006 (broken out as follows: John Hancock International Fund - $3,500, John Hancock Mid Cap Growth Fund - $2,750 and John Hancock Greater China Opportunities Fund - $3,500). The nature of the services comprising the tax fees was the review of the registrant’s income tax returns and tax distribution requirements. These fees were billed to the registrant and were approved by the registrant’s audit committee. There were no tax fees billed to the control affiliates.

(d) All Other Fees

There were no other fees during the fiscal year ended October 31, 2005 and fiscal year ended October 31, 2006 billed to the registrant or to the control affiliates.

(e)(1) See attachment "Approval of Audit, Audit-related, Tax and Other Services", with the audit committee pre-approval policies and procedures.

(e)(2) There were no fees that were approved by the audit committee pursuant to the de minimis exception for the fiscal years ended October 31, 2005 and October 31, 2006 on behalf of the

registrant or on behalf of the control affiliates that relate directly to the operations and financial reporting of the registrant.

(f) According to the registrant’s principal accountant, for the fiscal year ended October 31, 2006, the percentage of hours spent on the audit of the registrant's financial statements for the most recent fiscal year that were attributed to work performed by persons who were not full-time, permanent employees of principal accountant was less than 50%.

(g) The aggregate non-audit fees billed by the registrant's accountant(s) for services rendered to the registrant and rendered to the registrant's control affiliates for each of the last two fiscal years of the registrant were $212,062 for the fiscal year ended October 31, 2005 and $520,432 for the fiscal year ended October 31, 2006.

(h) The audit committee of the registrant has considered the non-audit services provided by the registrant’s principal accountant(s) to the control affiliates and has determined that the services that were not pre-approved are compatible with maintaining the principal accountant(s)' independence.

ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.

The registrant has a separately-designated standing audit committee comprised of independent trustees. The members of the audit committee are as follows:

Dr. John A. Moore - Chairman
Richard P. Chapman, Jr.
Charles L. Ladner
Patti McGill Peterson

ITEM 6. SCHEDULE OF INVESTMENTS.

Not applicable.

ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-
END MANAGEMENT INVESTMENT COMPANIES.

Not applicable.

ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT
COMPANIES.

Not applicable.

ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT
INVESTMENT COMPANY AND AFFILIATED PURCHASERS.

Not applicable.

ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

The registrant has adopted procedures by which shareholders August recommend nominees to the registrant's Board of Trustees. A copy of the procedures is filed as an exhibit to this Form N-CSR. See attached “John Hancock Funds – Governance Committee Charter”.

ITEM 11. CONTROLS AND PROCEDURES.

(a) Based upon their evaluation of the registrant's disclosure controls and procedures as conducted within 90 days of the filing date of this Form N-CSR, the registrant's principal executive officer and principal financial officer have concluded that those disclosure controls and procedures provide reasonable assurance that the material information required to be disclosed by the registrant on this report is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms.

(b) There were no changes in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an annual 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) Code of Ethics for Senior Financial Officers is attached.

(a)(2) Separate certifications for the registrant's principal executive officer and principal financial officer, as required by Section 302 of the Sarbanes-Oxley Act of 2002 and Rule 30a-2(a) under the Investment Company Act of 1940, are attached.

(b) Separate certifications for the registrant's principal executive officer and principal financial officer, as required by 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, and Rule 30a-2(b) under the Investment Company Act of 1940, are attached. The certifications furnished pursuant to this paragraph are not deemed to be "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liability of that section. Such certifications are not deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent that the Registrant specifically incorporates them by reference.

(c)(1) Approval of Audit, Audit-related, Tax and Other Services is attached.

(c)(2) Submission of Matters to a Vote of Security Holders is attached. See attached “John Hancock Funds – Governance Committee Charter”.

(c)(3) Contact person at the registrant.

(c)(4) Proxy Voting Policies and Procedures are attached.

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.

John Hancock Investment Trust III

By: /s/ Keith F. Hartstein
-------------------------------------
Keith F. Hartstein
President and Chief Executive Officer

Date: January 2, 2007

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

By: /s/ Keith F. Hartstein
-------------------------------------
Keith F. Hartstein
President and Chief Executive Officer

Date: January 2, 2007

By: /s/ John G. Vrysen
-------------------------------------
John G. Vrysen
Chief Financial Officer

Date: January 2, 2007

EX-99.CERT

CERTIFICATION

I, Keith F. Hartstein, certify that:

1. I have reviewed this report on Form N-CSR of the John Hancock Investment Trust III (the “registrant”);

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

By: /s/ Keith F. Hartstein
-------------------------------------

Keith F. Hartstein
President and Chief Executive Officer

Date: January 2, 2007

CERTIFICATION

I, John G. Vrysen, certify that:

1. I have reviewed this report on Form N-CSR of the John Hancock Investment Trust III (the “registrant”);

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

By: /s/ John G. Vrysen
-------------------------------------
John G. Vrysen
Chief Financial Officer

Date: January 2, 2007

EX-99.906 CERT

Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002

In connection with the attached Report of John Hancock Investment Trust III (the “registrant”) on Form N-CSR to be filed with the Securities and Exchange Commission (the "Report"), each of the undersigned officers of the registrant does hereby certify that, to the best of such officer's knowledge:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the registrant as of, and for, the periods presented in the Report.

/s/ Keith F. Hartstein
-------------------------------------
Keith F. Hartstein
President and Chief Executive Officer

Dated: January 2, 2007

/s/ John G. Vrysen
-------------------------------------
John G. Vrysen
Chief Financial Officer

Dated: January 2, 2007

A signed original of this written statement, required by Section 906, has been provided to the registrant and will be retained by the registrant and furnished to the Securities and Exchange Commission or its staff upon request.

EX-99.CODE ETH

JOHN HANCOCK FUNDS

CODE OF ETHICS

This is the code of ethics of:

• John Hancock Advisers, LLC

• MFC Global Investment Management (U.S.), LLC (formerly known as Sovereign Asset Management LLC)

• each open-end and closed-end fund advised by John Hancock Advisers, LLC

• John Hancock Funds, LLC

(together, called "John Hancock Funds" or "JHF")

1. General Principles

Each person within the John Hancock Funds organization is responsible for maintaining the very highest ethical standards when conducting our business.

This means that:

• You have a fiduciary duty at all times to place the interests of our clients and fund investors first.

• All of your personal securities transactions must be conducted consistent with the provisions of this code of ethics that apply to you and in such a manner as to avoid any actual or potential conflict of interest or other abuse of your position of trust and responsibility.

• You should not take inappropriate advantage of your position or engage in any fraudulent or manipulative practice (such as front-running or manipulative market timing) with respect to our clients' accounts or fund investors.

• You must treat as confidential any information concerning the identity of security holdings and financial circumstances of clients or fund investors.

• You must comply with all applicable federal securities laws.

• You must promptly report any violation of this code of ethics that comes to your attention to the Chief Compliance Officer of your company -see Appendix F.

The General Principles discussed above govern all conduct, whether or not

The General Principles discussed above govern all conduct, whether or not the conduct is also covered by more specific standards and procedures in this code of ethics. As described below under the heading "Interpretation and Enforcement", failure to comply with the code of ethics may result in disciplinary action, including termination of employment.

2. To Whom Does This Code Apply?

This code of ethics applies to you if you are a director, officer or employee of John Hancock Advisers, LLC, MFC Global Investment Management (U.S.), LLC, John Hancock Funds, LLC or a John Hancock open-end or closed-end fund registered under the Investment Company Act of 1940 (the "'40 Act") and advised by John Hancock Advisers, LLC ("John Hancock funds"). It also applies to you if you are trustee of the John Hancock Financial Trends Fund, Inc. or an employee of Manulife Financial Corporation or its subsidiaries who participates in making recommendations for, or receives information about, portfolio trades or holdings of the John Hancock funds or accounts. However, notwithstanding anything herein to the contrary, it does not apply to any trustees/directors of any open-end or closed-end funds advised by John Hancock Advisers, LLC who are not "interested persons" of such funds as defined in Section 2(a)(19) of the '40 Act, so long as they are subject to a separate Code of Ethics (each, an "Excluded Independent Director"). Also, in some cases only a limited number of provisions will apply to you, based on your access category. For example, only a limited number of provisions apply to directors of the John Hancock open-end funds and closed-end funds who are not Excluded Independent Directors-- see Appendix C for more information.

Please note that if a policy described below applies to you, it also applies to all accounts over which you have a beneficial interest. Normally, you will be deemed to have a beneficial interest in your personal accounts, those of a spouse, "significant other," minor children or family members sharing a household, as well as all accounts over which you have discretion or give advice or information. "Significant others" are defined for these purposes as two people who (1) share the same primary residence; (2) share living expenses; and (3) are in a committed relationship and intend to remain in the relationship indefinitely.

There are three main categories for persons covered by this code of ethics, taking into account their positions, duties and access to information regarding fund portfolio trades. You have been notified about which of these categories applies to you, based on the JHF Investment Compliance Department's understanding of your current role. If you have a level of investment access beyond your assigned category, or if you are promoted or change duties and as a result should more appropriately be included in a different category, it is your responsibility to notify the Chief Compliance Officer of your company.

The basic definitions of the three main categories, with examples, are provided below. The more detailed definitions of each category are attached as Appendix A.

“Investment Access” person		“Regular Access” person		“Non-Access” person
		A person who regularly has access
		to (1) fund portfolio trades or (2)		A person who does not regularly
A person who regularly participates		non-public information regarding		participate in a fund’s investment
in a fund’s investment process or		holdings or securities		process or obtain information
makes securities recommendations		recommendations to clients.		regarding fund portfolio trades
to clients.
			examples:		examples:
	examples:
		•	personnel in Investment	•	wholesalers
•	portfolio managers		Operations or Compliance
				•	inside wholesalers who
•	analysts	•	most FFM personnel		don’t attend investment
					“morning meetings”
•	traders	•	Technology personnel with
			access to investment	•	certain administrative
			systems		personnel
		•	attorneys and some legal
			administration personnel
		•	investment admin.
			personnel

3. Which Accounts and Securities are Subject to the Code's Personal Trading Restrictions?

If this code of ethics describes "Personal Trading Requirements" (i.e. John Hancock Mutual Fund reporting requirement and holding period, the preclearance requirement, the ban on short-term profits, the ban on IPOs, the disclosure of private placement conflicts and the reporting requirements) that apply to your access category as described above, then the requirements apply to trades for any account in which you have a beneficial interest. Normally, this includes your personal accounts, those of a spouse, "significant other," minor children or family members sharing your household, as well as all accounts over which you have discretion or give advice or information. This includes all brokerage accounts that contain securities (including brokerage accounts that only contain securities exempt from reporting). Accounts over which you have no direct or indirect influence or control are exempt. To prevent potential violations of this code of ethics, you are strongly encouraged to request clarification for any accounts that are in question.

These personal trading requirements do not apply to the following securities:

• Direct obligations of the U.S. government (e.g., treasury securities);

• Bankers' acceptances, bank certificates of deposit, commercial paper, and high quality short-term debt obligations, including repurchase agreements;

• Shares of open-end mutual funds registered under the '40 Act that are not advised or sub-advised by John Hancock Advisers, John Hancock Investment Management Services or another Manulife entity;

• Shares issued by money market funds; and

• Securities in accounts over which you have no direct or indirect influence or control.

Except as noted above, the Personal Trading Requirements apply to all securities, including:

• Stocks;

• Bonds;

• Government securities that are not direct obligations of the U.S. government, such as Fannie Mae or municipal securities;

• Closed-end funds;

• Options on securities, on indexes, and on currencies;

• Limited partnerships;

• Domestic unit investment trusts;

• Exchange traded funds;

• Non-US unit investment trusts and Non-US mutual funds;

• Private investment funds and hedge funds; and

• Futures, investment contracts or any other instrument that is considered a "security" under the Investment Advisers Act.

Different requirements apply to shares of open-end mutual funds that are advised or sub-advised by John Hancock Advisers, LLC or another Manulife entity--see the section below titled "John Hancock Mutual Funds Reporting Requirement and Holding Period".

4. Overview of Policies

	Investment Access	Regular Access	Non-Access Person
	Person	Person
General principles	yes	yes	yes
Policies outside the code
Conflict of interest policy	yes	yes	yes
Inside information policy	yes	yes	yes
Policy regarding dissemination of mutual fund	yes	yes	yes
portfolio information

Policies in the code
Restriction on gifts	yes	yes	yes
John Hancock mutual funds reporting	yes	yes	yes
requirement and holding period
Pre-clearance requirement	yes	yes	Limited
Heightened preclearance of securities	yes	yes	no
transactions for “Significant Personal
Positions”
Ban on short-term profits	yes	no	no
Ban on IPOs	yes	no	no
Disclosure of private placement conflicts	yes	no	no
Seven day blackout period	yes	no	no
Reports and other disclosures outside the code
Broker letter/duplicate confirms	yes	yes	yes
Reports and other disclosures in the code
Annual recertification form	yes	yes	yes
Initial/annual holdings reports	yes	yes	no
Quarterly transaction reports	yes	yes	no

5. Policies Outside of the Code of Ethics

John Hancock Funds have certain policies that are not part of the code of ethics, but are equally important. The two most important of these policies are (1) the Company Conflict and Business Practice Policy; and (2) the Inside Information Policy.

>> Company Conflict & Business Practice Policy

--------------------------------------------------------------------------------
Applies to: Investment Access Persons
Regular Access Persons
Non-Access Persons
--------------------------------------------------------------------------------

A conflict of interest occurs when your private interests interfere or could potentially interfere with your responsibilities at work. You must not place yourself or the company in a position of actual or potential conflict.

This Policy covers a number of important issues for officers and employees of John Hancock Funds. For example, you cannot serve as a director of any company without first obtaining the required written executive approval.

This Policy includes significant requirements to be followed if your personal securities holdings overlap with John Hancock funds investment activity. For example, if you or a member of your family own:

• a 5% or greater interest in a company, John Hancock Funds and its affiliates may not make any investment in that company;

• a 1% or greater interest in a company, you cannot participate in any decision by John Hancock Funds and its affiliates to buy or sell that company's securities;

• ANY interest in a company, you cannot recommend or participate in a decision by John Hancock Funds and its affiliates to buy or sell that company's securities unless your personal interest is fully disclosed at all stages of the investment decision.

(This is just a summary of these requirements--please read Section IV of the Company Conflict and Business Practices Policy for more detailed information.)

Other important issues in this Policy include:

• personal investments or business relationships

• misuse of inside information

• receiving or giving of gifts, entertainment or favors

• misuse or misrepresentation of your corporate position

• disclosure of confidential or proprietary information

• antitrust activities

• political campaign contributions and expenditures on public officials

>> Inside Information Policy and Procedures

--------------------------------------------------------------------------------
Applies to: Investment Access Persons
Regular Access Persons
Non-Access Persons
--------------------------------------------------------------------------------

The antifraud provisions of the federal securities laws generally prohibit persons with material non-public information from trading on or communicating the information to others. Sanctions for violations can include civil injunctions, permanent bars from the securities industry, civil penalties up to three times the profits made or losses avoided, criminal fines and jail sentences. While Investment Access persons are most likely to come in contact with material non-public information, the rules (and sanctions) in this area apply to all John Hancock Funds personnel and extend to activities both related and unrelated to your job duties.

The Inside Information Policy and Procedures covers a number of important issues, such as:

• The misuse of material non-public information

• The information barrier procedure

• The "restricted list" and the "watch list"

• broker letters and duplicate confirmation statements (see section 7 of this code of ethics)

>> Policy Regarding Dissemination of Mutual Fund Portfolio Information

--------------------------------------------------------------------------------
Applies to: Investment Access Persons
Regular Access Persons
Non-Access Persons
--------------------------------------------------------------------------------

Information about securities held in a mutual fund cannot be disclosed except in accordance with this Policy, which generally requires time delays of approximately one month and public posting of the information to ensure that it uniformly enters the public domain.

6. Policies in the Code of Ethics

>> Restriction on Gifts

--------------------------------------------------------------------------------
Applies to: Investment Access Persons
Regular Access Persons
Non-Access Persons
--------------------------------------------------------------------------------

You and your family cannot accept preferential treatment or favors (for example, gifts) from securities brokers or dealers or other organizations with which John Hancock Funds might transact business, except in accordance with the Company Conflict and Business Practice Policy. For the protection of both you and John Hancock Funds, the appearance of a possible conflict of interest must be avoided. You should exercise caution in any

instance in which business travel and lodging are paid for by someone other than John Hancock Funds. The purpose of this policy is to minimize the basis for any charge that you used your John Hancock Funds position to obtain for yourself opportunities which otherwise would not be offered to you. Please see the Company Conflict and Business Practice Policy's "Compensation and Gifts" section for additional details regarding restrictions on gifts and exceptions for "nominal value" gifts.

>> John Hancock Mutual Funds Reporting Requirement and Holding Period

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Applies to: Investment Access Persons
Regular Access Persons
Non-Access Persons
--------------------------------------------------------------------------------

You must follow the reporting requirement and the holding period requirement specified below if you purchase either:

• a "John Hancock Mutual Fund" (i.e. a '40 Act mutual fund that is advised by John Hancock Advisers, LLC, John Hancock Investment Management Services LLC or by another Manulife entity); or

• a "John Hancock Variable Product" (i.e. contracts funded by insurance company separate accounts that use one or more portfolios of John Hancock Trust). The John Hancock Mutual Funds reporting requirement and the holding period requirement are excluded for the money market funds and any dividend reinvestment, payroll deduction, systematic investment/withdrawal and/or other program trades.

Reporting Requirement: You must report your holdings and your trades in a John Hancock Mutual Fund or a John Hancock Variable Product. This is not a preclearance requirement--you can report your holdings after you trade by submitting duplicate confirmation statements to the JHF Investment Compliance Department. If you are an Investment Access Person or a Regular Access Person, you must also make sure that your holdings in a John Hancock fund or a John Hancock variable product are included in your Initial Holdings Report (upon hire) and Annual Holdings Report (each year end).

If you purchase a John Hancock Variable Product, you must notify the JHF Investment Compliance Department. The JHF Investment Compliance Department will then obtain directly from the contract administrators the personal trade and holdings information regarding the portfolios underlying the Manulife or John Hancock variable insurance contracts.

The JHF Investment Compliance Department will obtain personal securities trades and holdings information in the 401(k) plan for John Hancock funds directly from the plan administrators.

Holding Requirement: You cannot profit from the purchase and sale of a John Hancock Mutual Fund within 30 calendar days. The purpose of this policy is to address the risk, real or perceived, of manipulative market timing or other abusive practices involving short-term personal trading in the John Hancock Mutual Funds. Any profits realized on short-term trades must be surrendered by check payable to John Hancock Advisers, LLC and will be contributed by John Hancock Advisers, LLC to a charity, upon determination by the Compliance and Business Practices Committee. If you donate or gift a security, it is considered a sale. You may request an exemption from this policy for involuntary sales due to unforeseen corporate activity (such as a merger), or for sales due to hardship reasons (such as unexpected medical expenses) by sending an e-mail to the Chief Compliance Officer of your company.

>> Preclearance of Securities Transactions

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Applies to: Investment Access Persons
Regular Access Persons

Also, for a limited category of trades:
------------------------------------
Non-Access Persons
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Limited Category of Trades for Non-Access Persons: If you are a Non-Access person, you must preclear transactions in securities of any closed-end funds advised by John Hancock Advisers, LLC. A Non-Access person is not required to preclear other trades. However, please keep in mind that a Non-Access person is required to report securities transactions after every trade (even those that are not required to be precleared) by requiring your broker to submit duplicate confirmation statements, as described in section 7 of this code of ethics.

Investment Access persons and Regular Access persons: If you are an Investment Access person or Regular Access person, you must "preclear" (i.e.: receive advance approval of) any personal securities transactions in the categories described above in the section "Which Accounts and Securities are Subject to the Code's Personal Trading Restrictions". Due to this preclearance requirement, participation in investment clubs is prohibited.

Preclearance of private placements requires some special considerations--the decision will take into account whether, for example: (1) the investment opportunity should be reserved for John Hancock Funds clients; and (2) it is being offered to you because of your position with John Hancock Funds.

How to preclear: You preclear a trade by following the steps outlined in the preclearance procedures, which are attached as Appendix B. Please note that:

• You may not trade until clearance is received.

• Clearance approval is valid only for the date granted (i.e. the preclearance date and the trade date should be the same).

• A separate procedure should be followed for requesting preclearance of a private placement or a derivative, as detailed in Appendix B. The JHF Investment Compliance Department must maintain a five-year record of all clearances of private placement purchases by Investment Access persons, and the reasons supporting the clearances.

The preclearance policy is designed to proactively identify potential "problem trades" that raise front-running, manipulative market timing or other conflict of interest concerns (example: when an Investment Access person trades a security on the same day as a John Hancock fund).

Certain transactions in securities that would normally require pre-clearance are exempt from the pre-clearance requirement in the following situations; (1) shares are being purchased as part of an automatic investment plan; (2) shares are being purchased as part of a dividend reinvestment plan; or (3) transactions are being made in an account over which you have designated a third party as having discretion to trade (you must have approval from the Chief Compliance Officer to establish a discretionary account).

>> Heightened Preclearance of Securities Transactions for "Significant Personal Positions"

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Applies to: Investment Access Persons
Regular Access Persons
--------------------------------------------------------------------------------

If you are an Investment Access person or Regular Access person with a personal securities position that is worth $100,000 or more, this is deemed to be a "Significant Personal Position". This applies to any personal securities positions in the categories described above in the section "Which Accounts and Securities are Subject to the Code's Personal Trading Restrictions". Before you make personal trades to establish, increase or decrease a Significant Personal Position, you must notify either the Chief Fixed Income Officer or the Chief Equity Officer that (1) you intend to trade in a Significant Personal Position and (2) confirm that you are not aware of any clients for whom related trades should be completed first. You must receive their pre-approval to proceed--their approval will be based on their conclusion that your personal trade in a Significant Personal Position will not "front-run" any action that John Hancock Funds should take for a client. This Heightened Preclearance requirement is in addition to, not in place of, the regular preclearance requirement described above--you must also receive the regular preclearance before you trade.

>> Ban on Short-Term Profits

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Applies to: Investment Access Persons
--------------------------------------------------------------------------------

If you are an Investment Access person, you cannot profit from the purchase and sale (or sale and purchase) of the same (or equivalent) securities within 60 calendar days. This applies to any personal securities trades in the categories described above in the section "Which Accounts and Securities are Subject to the Code's Personal Trading Restrictions".

You may invest in derivatives or sell short provided the transaction period exceeds the 60-day holding period (30 days for '40 Act mutual funds advised by John Hancock Advisers, LLC, John Hancock Investment Management Services LLC or another Manulife entity). If you donate or gift a security, it is considered a sale.

The purpose of this policy is to address the risk, real or perceived, of front-running, manipulative market timing or other abusive practices involving short-term personal trading. Any profits realized on short-term trades must be surrendered by check payable to John Hancock Advisers, LLC and will be contributed by John Hancock Advisers, LLC to a charity, upon determination by the Compliance and Business Practices Committee.

You may request an exemption from this policy for involuntary sales due to unforeseen corporate activity (such as a merger), or for sales due to hardship reasons (such as unexpected medical expenses) from the JHF Investment Compliance Department.

>> Ban on IPOs

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Applies to: Investment Access Persons
--------------------------------------------------------------------------------

If you are an Investment Access person, you may not acquire securities in an initial public offering (IPO). You may not purchase any newly-issued securities until the next business (trading) day after the offering date. This applies to any personal securities trades in the categories described above in the section "Which Accounts and Securities are Subject to the Code's Personal Trading Restrictions".

There are two main reasons for this prohibition: (1) these purchases may suggest that persons have taken inappropriate advantage of their positions for personal profit; and (2) these purchases may create at least the appearance that an investment opportunity that should have been available to the John Hancock funds was diverted to the personal benefit of an individual employee.

You may request an exemption for certain investments that do not create a potential conflict of interest, such as: (1) securities of a mutual bank or mutual insurance company received as compensation in a demutualization and other similar non-voluntary stock acquisitions; (2) fixed rights offerings; or (3) a family member's participation as a form of employment compensation in their employer's IPO.

>> Disclosure of Private Placement Conflicts

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Applies to: Investment Access Persons
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If you are an Investment Access person and you own securities purchased in a private placement, you must disclose that holding when you participate in a decision to purchase or sell that same issuer's securities for a John Hancock fund. This applies to any private placement holdings in the categories described above in the section "Which Accounts and Securities are Subject to the Code's Personal Trading Restrictions". Private placements are securities exempt from SEC registration under section 4(2), section 4(6) or rules 504 -506 of the Securities Act of 1933.

The investment decision must be subject to an independent review by investment personnel with no personal interest in the issuer.

The purpose of this policy is to provide appropriate scrutiny in situations in which there is a potential conflict of interest.

>> Seven Day Blackout Period

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Applies to: Investment Access Persons
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If you are a portfolio manager (or were identified to the JHF Investment Compliance Department as part of a portfolio management team) you are prohibited from buying or selling a security within seven calendar days before and after that security is traded for a fund that you manage unless no conflict of interest exists in relation to that security (as determined by the Compliance and Ethics Committee).

In addition, all investment access persons are prohibited from knowingly buying or selling a security within seven calendar days before and after that security is traded for a John Hancock fund unless no conflict of interest exists in relation to that security. This applies to any personal securities trades in the categories described above in the section "Which Accounts and Securities are Subject to the Code's Personal Trading Restrictions". If a John Hancock fund trades in a security within seven calendar days before or after you trade in that security, you may be required to demonstrate that you did not know that the trade was being considered for that John Hancock fund.

You will be required to sell any security purchased in violation of this policy unless it is determined that no conflict of interest exists in relation to that security (as determined by the Compliance and Ethics Committee). Any profits realized on trades determined by the Compliance and Ethics Committee to be in violation of this policy must be surrendered by check payable to John Hancock Advisers, LLC and will be contributed by John Hancock Advisers, LLC to a charity.

7. Reports and Other Disclosures Outside the Code of Ethics

>> Broker Letter/Duplicate Confirm Statements

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Applies to: Investment Access Persons
Regular Access Persons
Non-Access Persons
--------------------------------------------------------------------------------

As required by the Inside Information Policy, you must inform your stockbroker that you are employed by an investment adviser or broker. Your broker is subject to certain rules designed to prevent favoritism toward your accounts. You may not accept negotiated commission rates that you believe may be more favorable than the broker grants to accounts with similar characteristics.

When a brokerage account is opened for which you have a beneficial interest, before any trades are made, you must:

• Notify the broker-dealer with which you are opening an account that you are a registered associate of John Hancock Funds;

• Ask the firm in writing to have duplicate written confirmations of any trade, as well as statements or other information concerning the account, sent to the John Hancock Funds Investment Compliance Department (contact: Fred Spring), 8th Floor, 101 Huntington Avenue, Boston, MA 02199; and

• Notify the JHF Investment Compliance Department, in writing, that you have an account before you place any trades.

This applies to any personal securities trades in the categories described above in the section "Which Accounts and Securities are Subject to the Code's Personal Trading Restrictions" as well as trades in John Hancock Mutual Funds and John Hancock Variable Products. The JHF Investment Compliance Department may rely on information submitted by your broker as part of your reporting requirements under this code of ethics.

8. Reports and Other Disclosures In the Code of Ethics

>> Initial Holdings Report and Annual Holdings Report

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Applies to: Investment Access Persons
Regular Access Persons
--------------------------------------------------------------------------------

You must file an initial holdings report within 10 calendar days after becoming an Investment Access person or a Regular Access person. The information must be current as of a date no more than 45 days prior to your becoming an Investment Access person or a Regular Access person.

You must also file an annual holdings report (as of December 31st) within 45 calendar days after the calendar year end. This applies to any personal securities holdings in the categories described above in the section "Which Accounts and Securities are Subject to the Code's Personal Trading Restrictions" as well as holdings in John Hancock Mutual Funds and John Hancock Variable Products.

Your reports must include:

• the title and type of security, and as applicable the exchange ticker symbol or CUSIP number, number of shares, and principal amount of each reportable security;

• the name of any broker, dealer or bank with which you maintain an account; and

• the date that you submit the report.

>> Quarterly Transaction Certification

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Applies to: Investment Access Persons
Regular Access Persons
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On a quarterly basis, Investment Access Persons and Regular Access persons are required to certify transactions in their brokerage accounts and the John Hancock Funds 401(k) Plan. Within 30 calendar days after the end of each calendar quarter you will be asked to log into the John Hancock Personal Trading and Reporting System to verify that the system has captured accurately all transactions for the preceding calendar quarter for accounts and trades which are required to be reported pursuant to the above noted section entitled "Which Accounts and Securities are Subject to the Code's Personal Trading Restrictions". Even if you have no transactions to report you will be asked to complete the certification.

For each transaction you must report the following information:

• the date of the transaction, the title, and as applicable the exchange ticker symbol or CUSIP number, interest rate and maturity date, number of shares, and principal amount of each reportable security involved;

• the nature of the transaction (i.e. purchase, sale or any other type of acquisition or disposition);

• the price at which the transaction was effected;

• the name of the broker, dealer or bank with or through which the transaction was effected; and

>> Quarterly Brokerage Account Certification

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Applies to: Investment Access Persons
Regular Access Persons
Non-Access Persons
--------------------------------------------------------------------------------

Each quarter, all Investment Access Persons, Regular Access Persons and Non-Access Persons will be required to provide a complete list of all brokerage accounts as described above in the section entitled "Which Accounts and Securities are Subject to the Code's Personal Trading Restrictions". This includes all brokerage accounts, including brokerage accounts that only contain securities exempt from reporting.

You will be asked to log into the John Hancock Personal Trading and Reporting System and verify that all brokerage accounts are listed and the following information is accurate:

• Account number;

• Account registration;

• Brokerage firm

>> Annual Certification

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Applies to: Investment Access Persons
Regular Access Persons
Non-Access Persons
Limited Access Persons
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At least annually (or additionally when the code of ethics has been significantly changed), you must provide a certification at a date designated by the Investment Compliance Department that:

(1) you have read and understood this code of ethics;

(2) you recognize that you are subject to its policies; and

(3) you have complied with its requirements.

You are required to make this certification to demonstrate that you understand the importance of these policies and your responsibilities under the code of ethics.

9. Limited Access Persons

There is an additional category of persons called "Limited Access" persons. This category consists only of directors of John Hancock Advisers, LLC, trustees of the John Hancock Financial Trends Fund, Inc. or an "interested person" of the John Hancock funds who:

(a) are not also officers of John Hancock Advisers, LLC; and

(b) do not ordinarily obtain information about fund portfolio trades

An "interested person" of the John Hancock funds has the meaning given to the term in Section 2(a)(19) of the '40 Act.

A more detailed definition of Limited Access persons, and a list of the policies that apply to them, is attached as Appendix C.

10. Subadvisers

A subadviser to a John Hancock fund has a number of code of ethics responsibilities, as described in Appendix D.

11. Reporting Violations

If you know of any violation of our code of ethics, you have a responsibility to promptly report it to the Chief Compliance Officer of your company. You should also report any deviations from the controls and procedures that safeguard John Hancock Funds and the assets of our clients. You can request confidential treatment of your reporting action.

12. Interpretation and Enforcement

This code of ethics cannot anticipate every situation in which personal interests may be in conflict with the interests of our clients and fund investors. You should be responsive to the spirit and intent of this code of ethics as well as its specific provisions.

When any doubt exists regarding any code of ethics provision or whether a conflict of interest with clients or fund investors might exist, you should

discuss the situation in advance with the Chief Compliance Officer of your company. The code of ethics is designed to detect and prevent fraud against clients and fund investors, and to avoid the appearance of impropriety. If you feel inequitably burdened by any policy, you should feel free to contact your Chief Compliance Officer or the Compliance and Business Practices Committee. Exceptions may be granted where warranted by applicable facts and circumstances. For example, exemption from some Personal Trading Requirements may be granted for transactions effected pursuant to an automatic investment plan.

To provide assurance that policies are effective, the JHF Investment Compliance Department will monitor and check personal securities transaction reports and certifications against fund portfolio transactions. Additional administration and recordkeeping procedures are described in Appendix E.

The Chief Compliance Officer of your company has general administrative responsibility for this code of ethics as it applies to the access persons of your company; an appropriate Compliance Department will administer procedures to review personal trading reports. The Compliance and Business Practices Committee of John Hancock Funds approves amendments to the code of ethics and dispenses employee/officer sanctions for violations of the code of ethics. The Boards of Trustees/Directors of the open-end mutual funds and closed-end funds also approve amendments to the code of ethics and dispenses sanctions for access persons of the Funds who are not employees/officers. Accordingly, the Investment Compliance Department will refer violations to the Compliance and Business Practices Committee and/or the Boards of Trustees/Directors of the John Hancock '40 Act funds, respectively, for review and appropriate action. The following factors will be considered when determining a fine or other disciplinary action:

• the person's position and function (senior personnel may be held to a higher standard);

• the amount of the trade;

• whether the funds or accounts hold the security and were trading the same day;

• whether the violation was by a family member.

• whether the person has had a prior violation and which policy was involved.

• whether the employee self-reported the violation.

You can request reconsideration of any disciplinary action by submitting a written request.

No less frequently than annually, a written report of all material violations and sanctions, significant conflicts of interest and other related issues will be submitted to the boards of directors of the John

Hancock funds for their review. Sanctions for violations could include (but are not limited to) fines, limitation of personal trading activity, suspension or termination of the violator's position with John Hancock Funds and/or a report to the appropriate regulatory authority.

13. Education of Employees

The JHF Investment Compliance Department will provide a paper copy or electronic version of the Code of Ethics (and any amendments) to each person subject to this Code of Ethics. The JHF Investment Compliance Department will also administer training of employees on the principles and procedures of the code of ethics.

Appendix A: Categories of Personnel

You have been notified about which of these categories applies to you, based on the JHF Investment Compliance Department's understanding of your current role. If you have a level of investment access beyond that category, or if you are promoted or change duties and as a result should more appropriately be included in a different category, it is your responsibility to immediately notify the Chief Compliance Officer of your company.

1) Investment Access person: You are an Investment Access person if you are an employee of John Hancock Advisers, LLC, MFC Global Investment Management (U.S.), LLC, a John Hancock fund, or Manulife Financial Corporation or its subsidiaries who, in connection with your regular functions or duties, makes or participates in making recommendations regarding the purchase or sale of securities by a John Hancock fund.

(examples: portfolio managers, analysts, traders)

2) Regular Access person: You are a Regular Access person if you do not fit the definition of Investment Access Person, but you do fit one of the following two sub-categories:

• You are an officer (vice president and higher) or director of John Hancock Advisers, LLC, MFC Global Investment Management (U.S.), LLC or a John Hancock fund, unless you qualify as a Limited Access person--please see Appendix C for this definition.)

• You are an employee of John Hancock Advisers, LLC, MFC Global Investment Management (U.S.), LLC, a John Hancock fund or Manulife Financial Corporation or its subsidiaries , or a director, officer (vice president and higher) or employee of John Hancock Funds, LLC who has access to nonpublic information regarding any clients' purchase or sale of securities, or nonpublic information regarding the portfolio holdings of any reportable fund or who is involved in making securities recommendations to clients, or who has access to such recommendations that are nonpublic.

(examples: Investment Operations personnel, Investment Compliance Department personnel, most Fund Financial Management personnel, investment administrative personnel, Technology Resources personnel with access to investment systems, attorneys and some legal administration personnel)

3) Non-Access person: You are a non-access person if you are an employee of John Hancock Advisers, LLC, MFC Global Investment Management (U.S.), LLC, John Hancock Funds, LLC or a John Hancock fund who does not fit the definitions of any of the other three categories (Investment Access Person, Regular Access Person or Limited Access Person). To be a non-access person, you must not have access to information regarding the purchase or sale of securities by a John Hancock fund or nonpublic information regarding the portfolio holdings in connection with your regular functions or duties.

(examples: wholesalers, inside wholesalers, certain administrative staff)

4) Limited Access Person: Please see Appendix C for this definition.

Appendix B: Preclearance Procedures

You should read the Code of Ethics to determine whether you must obtain a preclearance before you enter into a securities transaction. If you are required to obtain a preclearance, you should follow the procedures detailed below.

1. Pre-clearance for Public Securities including Derivatives, Futures, Options and Selling Short:

A request to pre-clear should be entered into the John Hancock Personal Trading & Reporting System.

The John Hancock Personal Trading & Reporting System is located under your Start Menu on your Desktop. It can be accessed by going to Programs/Personal Trading & Reporting/ Personal Trading & Reporting and by entering your Web Security Services user id and password.

If the John Hancock Personal Trading & Reporting System is not on your Desktop, please contact the HELP Desk at (617) 572-6950 for assistance.

The Trade Request Screen:

At times you may receive a message like "System is currently unavailable". The system is scheduled to be offline from 8:00 PM until 7:00 AM each night.

[GRAPHIC: Trade Request Screen]

Ticker/Security Cusip: Fill in either the ticker, cusip or security name with the proper information of the security you want to buy or sell. Then

click the [Lookup] button. Select one of the hyperlinks for the desired security, and the system will populate the proper fields Ticker, Security Cusip, Security Name and Security Type automatically on the Trade Request Screen.

If You Don't Know the Ticker, Cusip, or Security Name:

If you do not know the full ticker, you may type in the first few letters followed by an asterisk * and click the [Lookup] button. For example, let's say you want to buy some shares of Intel, but all you can remember of the ticker is that it begins with int, so you enter int* for Ticker. If any tickers beginning with int are found, they are displayed on a new screen. Select the hyperlink of the one you want, and the system will populate Security Cusip, Security Name and Security Type automatically on the Trade Request Screen. If you do not know the full cusip, you may type in the first few numbers followed by an asterisk * and click the [Lookup] button. For example, let's say you want to buy some shares of Microsoft, but all you can remember of the cusip is that it begins with 594918, so you enter 594918* for Ticker. If any cusips beginning with 594918 are found, they are displayed on a new screen. Select the hyperlink of the one you want, and the system will fill in Ticker, Security Name and Security Type automatically on the Trade Request Screen. If you do not know the Ticker but have an idea of what the Security Name is, you may type in an asterisk, a few letters of the name and an asterisk * and click the [Lookup] button. For example, let's say you want to buy some shares of American Brands, so you enter *amer* for Security Name. Any securities whose names have amer in them are displayed on a new screen, where you are asked to select the hyperlink of the one you want, and the system will fill in Ticker, Cusip and Security Type automatically on the Trade Request Screen.

Other Items on the Trade Request Screen:

Brokerage Account: Click on the dropdown arrow to the right of the Brokerage Account field to choose the account to be used for the trade.

Transaction Type: Choose one of the values displayed when you click the dropdown arrow to the right of this field.

Trade Date: You may only submit trade requests for the current date.

Note: One or more of these fields may not appear on the Request Entry screen if the information is not required. Required fields are determined by the Investment Compliance Department.

Click the [Submit Request] button to send the trade request to your Investment Compliance department.

Once you click the [Submit Request] button, you will be asked to confirm the values you have entered. Review the information and click the [Confirm] button if all the information is correct. After which, you will receive

immediate feedback in your web browser. (Note: We suggest that you print out this confirmation and keep it as a record of the trade you have made). After this, you can either submit another trade request or logout.

Attention Investment Access Persons: If the system identifies a potential violation of the Ban on Short Term Profits Rule, your request will be sent to the Investment Compliance Department for review and you will receive feedback via the e-mail system.

Starting Over:

To clear everything on the screen and start over, click the [Clear Screen] button.

Exiting Without Submitting the Trade Request:

If you decide not to submit the trade request before clicking the [Submit Request] button, simply exit from the browser by clicking the [X] button on the upper right or by pressing [Alt+F4], or by clicking the Logout hyperlink on the lower left side of the screen.

Ticker/Security Name Lookup Screen:

You arrive at this screen from the Trade Request Screen, where you've clicked the [Lookup] button (see above, "If You Don't Know the Ticker, Cusip, or Security Name"). If you see the security you want to trade, you simply select its corresponding hyperlink, and you will automatically return to the Trade Request Screen, where you finish making your trade request. If the security you want to trade is not shown, that means that it is not recognized by the system under the criteria you used to look it up. Keep searching under other names (click the [Return to Request] button) until you are sure that the security is not in the system. If you determine that the desired security is not in the system, please contact a member of the Investment Compliance department to add the security for you. Contacts are listed below:

Fred Spring (617) 375-4987

Adding Brokerage Accounts:

To access this functionality, click on the Add Brokerage Account hyperlink on the left frame of your browser screen. You will be prompted to enter the Brokerage Account Number, Brokerage Account Name, Date Opened, and Broker. When you click the [Create New Brokerage Account] button, you will receive a message that informs you whether the account was successfully created.

[GRAPHIC: Add Brokerage Account screen]

3. Pre-clearance for Private Placements and Initial Public Offerings:

You may request a preclearance of private placement securities or an Initial Public Offering by contacting Fred Spring via email (please "cc." Frank Knox on all such requests). Please keep in mind that the code of ethics prohibits Investment Access persons from purchasing securities in an initial public offering.

The request must include:

|_| the associate's name;

|_| the associate's John Hancock Funds' company;

|_| the complete name of the security;

|_| the seller (i.e the selling party if identified and/or the broker-dealer or placement agent) and whether or not the associate does business with those individuals or entities on a regular basis;

|_| the basis upon which the associate is being offered this investment opportunity;

|_| any potential conflict, present or future, with fund trading activity and whether the security might be offered as inducement to later recommend publicly traded securities for any fund or to trade through a particular broker-dealer or placement agent; and

|_| the date of the request.

Clearance of private placements or initial public offerings may be denied for any appropriate reason, such as if the transaction could create the appearance of impropriety. Clearance of initial public offerings will also be denied if the transaction is prohibited for a person due to his or her access category under the code of ethics.

Appendix C: Limited Access Persons

There are three types of Limited Access Persons--(1) Certain directors of the Adviser and (2) the trustees of the John Hancock Financial Trends Fund, Inc. and (3) the directors of the John Hancock open-end funds and closed-end funds who are not Excluded Independent Directors

(1) Certain Directors of the Adviser:

You are a Limited Access person if you are a director of John Hancock Advisers, LLC or MFC Global Investment Management (U.S.), LLC and you meet the three following criteria:

(a) you are not also an officer of John Hancock Advisers, LLC, MFC Global Investment Management (U.S.), LLC or a John Hancock fund;

(b) you do not have access to nonpublic information regarding any clients' purchase or sale of securities, or nonpublic information regarding the portfolio holdings of any John Hancock fund or account; and

(c) you are not involved in making securities recommendations to clients and do not have access to such recommendations that are nonpublic.

(examples: directors of John Hancock Advisers, LLC or MFC Global Investment Management (U.S.), LLC who are not involved in the daily operations of the adviser)

If you are a Limited Access Person who fits this definition, the following policies apply to your category. These policies are described in detail in the code of ethics.

• General principles

• Inside information policy and procedures

• Broker letter/Duplicate Confirms*

• Initial/annual holdings reports*

• Quarterly transaction reports*

• Annual recertification

• Preclearance requirement LIMITED: You only need to preclear any direct or indirect acquisition of beneficial ownership in any security in an initial public offering (an IPO) or in a limited offering (i.e. a private placement). To request preclearance of these securities, contact

Fredrick Spring at fspring@jhancock.com and/or Frank Knox at Frank_Knox@manulifeusa.com.

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*A Limited Access Person may complete this requirement under the code of
ethics of another Manulife/John Hancock adviser or fund by the applicable
regulatory deadlines and arrange for copies of the required information to
be sent to the John Hancock Funds Compliance Department.

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(2) The Independent Directors of the Funds: If you are a trustee of the John Hancock Financial Trends Fund, Inc. or a director to a John Hancock fund and an "interested person" of the fund within the meaning of the Investment Company Act of 1940, the following policies apply to your category. These policies are described in detail in the code of ethics.

• General principles

• Annual recertification

• Quarterly transaction report, but only if you knew (or should have known) that during the 15 calendar days before or after you trade a security, either:

(i) a John Hancock fund purchased or sold the same security, or

(ii) a John Hancock fund or John Hancock Advisers, LLC considered purchasing or selling the same security.

This policy applies to holdings in your personal accounts, those of a spouse, "significant other" or family members sharing your household, as well as all accounts over which you have discretion or give advice or information. If this situation occurs, it is your responsibility to contact the Chief Compliance Officer of your company and he will assist you with the requirements of the quarterly transaction report.

This means that the independent directors of the funds will not usually be required to file a quarterly transaction report--they are only required to file in the situation described above and only if they are not Excluded Independent Directors.

Appendix D: Subadvisers

Each subadviser to a John Hancock fund is subject to its own code of ethics, which must meet the requirements of Rule 17j-1 and Rule 204A-1.

Approval of Code of Ethics

Each subadviser to a John Hancock fund must provide a copy of its code of ethics to the trustees of the relevant John Hancock funds for approval initially and within 60 calendar days of any material amendment. The trustees will give their approval if they determine that the code:

• contains provisions reasonably necessary to prevent the subadviser's Access Persons (as defined in Rule 17j-1) from engaging in any conduct prohibited by Rule 17j-1;

• requires the subadviser's Access Persons to make reports to at least the extent required in Rule 17j-1(d);

• requires the subadviser to institute appropriate procedures for review of these reports by management or compliance personnel (as contemplated by Rule 17j-1(d)(3));

• provides for notification of the subadviser's Access Persons in accordance with Rule 17j-1(d)(4); and

• requires the subadviser's Access Persons who are Investment Personnel to obtain the pre-clearances required by Rule 17j-1(e);

Reports and Certifications

Each subadviser must provide an annual report and certification to John Hancock Advisers, LLC and the fund's trustees in accordance with Rule 17j-1(c)(2)(ii). The subadviser must also provide other reports or information that John Hancock Advisers, LLC may reasonably request.

Recordkeeping Requirements

The subadviser must maintain all records for its Access Persons as required by Rule 17j-1(f).

Appendix E: Administration and Recordkeeping

Adoption and Approval

The trustees of a John Hancock fund must approve the code of ethics of an adviser, subadviser or affiliated principal underwriter before initially retaining its services.

Any material change to a code of ethics of a John Hancock fund, John Hancock Funds, LLC, John Hancock Advisers, LLC or a subadviser to a fund must be approved by the trustees of the John Hancock funds, including a majority of trustees who are not interested persons, no later than six months after adoption of the material change.

Administration

No less frequently than annually, John Hancock Funds, LLC, John Hancock Advisers, LLC, each subadviser and each John Hancock fund will furnish to the trustees of each John Hancock fund a written report that:

• describes issues that arose during the previous year under the code of ethics or the related procedures, including, but not limited to, information about material code or procedure violations, and

• certifies that each entity has adopted procedures reasonably necessary to prevent its access persons from violating its code of ethics.

Recordkeeping

The Investment Compliance Department will maintain:

• a copy of the current code of ethics for John Hancock Funds, LLC, John Hancock Advisers, LLC, MFC Global Investment Management (U.S.), LLC, and each John Hancock fund, and a copy of each code of ethics in effect at any time within the past five years.

• a record of any violation of the code of ethics, and of any action taken as a result of the violation, for six years.

• a copy of each report made by an Access person under the code of ethics, for six years (the first two years in a readily accessible place).

• a record of all persons, currently or within the past five years, who are or were required to make reports under the code of ethics. This record will also indicate who was responsible for reviewing these reports.

• a copy of each code of ethics report to the trustees, for six years (the first two years in a readily accessible place).

• a record of any decision, and the reasons supporting the decision, to approve the acquisition by an Investment Access person of initial public offering securities or private placement securities, for six years.

Appendix F: Chief Compliance Officers

Entity	Chief Compliance Officer
John Hancock Advisers, LLC	Frank Knox
MFC Global Investment Management (U.S.), LLC	Frank Knox
Each open-end and closed-end fund advised	Frank Knox
by John Hancock Advisers, LLC
John Hancock Funds, LLC	Michael Mahoney

EX-99

JOHN HANCOCK FUNDS

AUDIT COMMITTEE CHARTER

A. Membership. The Audit Committee shall be composed exclusively of Trustees who are not "interested persons" as defined in the Investment Company Act of 1940 of any of the funds, or of any fund's investment adviser or principal underwriter (the "Independent Trustees") and who satisfy the independence and financial literacy requirements in this charter. The Audit Committee shall be composed of at least three Independent Trustees who are designated for membership from time to time by the Board of Trustees of Trustees. In selecting Independent Trustees to serve on the Audit Committee, the Board should select members who are free of any relationship that, in the opinion of the Board, may interfere or give the appearance of interfering with such member's individual exercise of independent judgment. Unless otherwise determined by the Board, no member of the Audit Committee may serve on the audit committee of more than two other public companies (other than another John Hancock Fund). Except as otherwise permitted by the applicable rules of the New York Stock Exchange, each member of the Audit Committee shall be independent as defined by such rules and Rule 10A-3(b)(1) of the Exchange Act. Each member of the Audit Committee must be financially literate, as such qualification is interpreted by the Board of Trustees in its business judgment, or must become financially literate within a reasonable period of time after his or her appointment to the Audit Committee. At least one member of the Audit Committee must have accounting or related financial management expertise, as the Board of Trustees interprets such qualification in its business judgment.

B. Overview. The Audit Committee's purpose is to:

1. assist the Board of Trustee's oversight of (1) the integrity of the funds' financial statements, (2) the funds' compliance with legal and regulatory requirements (except to the extent such responsibility is delegated to another committee), (3) the independent auditor's qualifications and independence, and (4) the performance of the funds' internal audit function and independent auditors;

2. act as a liaison between the funds' independent accountants and the Board of Trustees;

3. prepare an Audit Committee Report as required by the Securities and Exchange Commission (the "SEC") to the extent required to be included in the funds' annual proxy statement or other filings;

The Audit Committee shall discharge its responsibilities, and shall access

the information provided by the funds' management and independent auditors, in accordance with its business judgment. Management is responsible for the preparation of the fund's financial statements and the independent auditors are responsible for auditing those financial statements. The Audit Committee and the Board of Trustees recognize that management (including the internal audit staff) and the independent auditors have more experience, expertise, resources and time, and more detailed knowledge and information regarding a fund's accounting, auditing, internal control and financial reporting practices than the Audit Committee does. Accordingly, the Audit Committee's oversight role does not provide any expert or special assurance as to the financial statements and other financial information provided by a fund to its shareholders and others. The independent auditors are responsible for auditing the funds' annual financial statements. The authority and responsibilities set forth in this charter do not reflect or create any duty or obligation of the Audit Committee to plan or conduct any audit, to determine or certify that any fund's financial statements are complete, accurate, fairly presented, or in accordance with generally accepted accounting principles or applicable law, or to guarantee any independent auditor's report.

C. Oversight. The independent auditors shall report directly to the Audit Committee, and the Audit Committee shall be responsible for oversight of the work of the independent auditors, including resolution of any disagreements between any fund's management and the independent auditors regarding financial reporting. In connection with its oversight role, the Audit Committee should also review with the independent auditors, from time to time as appropriate: significant risks and uncertainties with respect to the quality, accuracy or fairness of presentation of a fund's financial statements; recently disclosed problems with respect to the quality, accuracy or fairness of presentation of the financial statements of companies similarly situated to the funds and recommended actions which might be taken to prevent or mitigate the risk of problems at the funds arising from such matters; accounting for unusual transactions; adjustments arising from audits that could have a significant impact on the funds' financial reporting process; and any recent SEC comments on the funds' SEC reports, including, in particular, any compliance comments. The Audit Committee should inquire of the independent auditor concerning the quality, not just the acceptability, of the funds' accounting determinations and other judgmental areas and question whether management's choices of accounting principles are, as a whole, conservative, moderate or aggressive.

D. Specific Responsibilities. The Audit Committee shall have the following duties and powers, to be exercised at such times and in such manner as the Committee shall deem necessary or appropriate:

1. To oversee the funds' auditing and accounting process.

2. To approve, and recommend to the Board of Trustees of Trustees for its ratification and approval in accord with applicable law, the selection, appointment and retention of an independent auditor for each fund prior to the engagement of such independent auditor and, at an appropriate time, its compensation. The Committee should meet with the independent auditor prior to the audit to discuss the planning and staffing of the audit. The Committee should periodically consider whether, in order to assure continuing auditor independence, there should be regular rotation of the independent audit firm and obtain and review a copy of the most recent report on the independent auditor issued by the Public Company Accounting Oversight Board pursuant to Section 104 of the Sarbanes-Oxley Act.

3. To periodically review and evaluate the lead partner and other senior members of the independent auditor's team and confirm the regular rotation of the lead audit partner and reviewing partner as required by Section 203 of the Sarbanes-Oxley Act.

4. To confirm that the officers of the funds were not employed by the independent auditor, or if employed, did not participate in any capacity in the audit of the funds, in each case, during the one-audit-year period preceding the date of initiation of the audit, as required by Section 206 of the Sarbanes-Oxley Act.

5. To pre-approve all non-audit services provided by the independent auditor to the fund or to the fund's investment adviser and any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the fund, if the engagement relates directly to the operations and financial reporting of the fund.

6. The Committee is authorized to delegate, to the extent permitted by law, pre-approval responsibilities to one or more members of the Committee who shall report to the Committee regarding approved services at the Committee's next regularly scheduled meeting. The Committee is also authorized to adopt policies and procedures which govern the pre-approval of audit, audit-related, tax and other services provided by the independent accountants to the funds or to a service provider as referenced in Paragraph 5, provided however, that any such policies and procedures are detailed as to particular services, the Audit Committee is informed of each service, and any such policies and procedures do not include the delegation of the Audit Committee's responsibilities under the Securities Exchange Act of 1934 or applicable rules or listing requirements.

7. To monitor the independent auditor of each fund throughout the engagement to attempt to identify: conflicts of interest between management and the independent auditor as a result of employment relationships; the provision of prohibited non-audit services to a fund by its independent

auditor; violations of audit partner rotation requirements; and prohibited independent auditor compensation arrangements whereby individuals employed by the auditor are compensated based on selling non-audit services to the fund. The independent auditors should promptly contact the Audit Committee or its Chair about any significant issue or disagreement concerning a fund's accounting practices or financial statements that is not resolved to their satisfaction or if Section 10A(b) of the Exchange Act has been implicated.

8. To meet with independent auditors, including private meetings, as necessary, management's internal auditors, and the funds' senior management (i) to review the arrangements for and scope of the annual audit and any special audits; (ii) to review the form and substance of the funds' financial statements and reports, including each fund's disclosures under "Management's Discussion of Fund Performance" and to discuss any matters of concern relating to the funds' financial statements, including any adjustments to such statements recommended by the independent accountants, or other results of an audit; (iii) to consider the independent accountants' comments with respect to the funds' financial policies, procedures and internal accounting controls and management's responses thereto; (iv) to review the resolution of any disagreements between the independent accountants and management regarding the funds' financial reporting; and (v) to review the form of opinion the independent accountants propose to render to the Board and shareholders. The Audit Committee should request from the independent auditors a frank assessment of management.

9. With respect to any listed fund, to consider whether it will recommend to the Board of Trustees that the audited financial statements be included in a fund's annual report. The Board delegates to the Audit Committee the authority to release the funds' financial statements for publication in the annual and semi-annual report, subject to the Board's right to review and ratify such financial statements following publication. With respect to each fund, to review and discuss with each fund's management and independent auditor the funds' audited financial statements and the matters about which Statement on Auditing Standards No. 61 (Codification of Statements on Auditing Standards, AU 380) requires discussion. The Audit Committee shall prepare an annual committee report for inclusion where necessary in the proxy statement of a fund relating to its annual meeting of security holders or in any other filing required by the SEC's rules.

10. To receive and consider reports on the audit functions of the independent auditors and the extent and quality of their auditing programs.

11. To assist the Board of Trustees in monitoring the Office of the Chief Compliance Officer (the "CCO") by:

• Reviewing, no less frequently than annually, the CCO's report on the operation of the compliance programs of the funds and compliance programs of the funds' adviser, sub-advisers, principal underwriter, administrator, and transfer agent (collectively, "service providers").

• Reviewing matters relating to the compliance programs of the funds and the compliance programs of their service providers and compliance matters relating to the funds and their service providers as may be presented to the Committee by the CCO.

• Making recommendations to the Board of Trustees regarding changes to the funds' compliance program, as may be necessary or appropriate from time to time.

• Reviewing the compliance programs for proposed service providers to the funds, including subadvisers, and making recommendations regarding approval of such compliance programs to the Board of Trustees.

• Reviewing regulatory inquiries relating to the funds and their service providers as may be presented to the Committee by the CCO.

• Reviewing the CCO's goals and objectives and making recommendations to the Board of Trustees regarding the CCO's compensation, including bonus and merit components.

• Reviewing the CCO's annual budget and making recommendations to the Board of Trustees regarding its approval and the amount of such budget that should be an expense of the funds.

12. To obtain and review, at least annually, a report by the independent auditor describing: the firm's internal quality-control procedures; any material issues raised by the most recent internal quality-control review, or peer review, of the firm, or by any inquiry or investigation by governmental or professional authorities, within the preceding five years, respecting one or more independent audits carried out by the firm, and any steps taken to deal with any such issues; and all relationships between the independent auditor and each fund, including the disclosures required by any applicable Independence Standards Board Standard. The Audit Committee shall engage in an active dialogue with each independent auditor concerning any disclosed relationships or services that might impact the objectivity and independence of the auditor.

13. To review with the independent auditor any problems that may be reported to it arising out of a fund's accounting, auditing or financial reporting functions and management's response, and to receive and consider reports on critical accounting policies and practices and alternative

treatments discussed with management.

14. To review the procedures for allocating fund brokerage, the allocation of trades among various accounts under management and the fees and other charges for fund brokerage.

15. To receive and consider reports from the independent auditors regarding reviews of the operating and internal control structure of custodian banks and transfer agents, including procedures to safeguard fund assets.

16. To monitor securities pricing procedures and review their implementation with management, management's internal auditors, independent auditors and others as may be required.

17. To establish and monitor, or cause to be established and monitored, procedures for the receipt, retention, and treatment of complaints received by a fund regarding accounting, internal accounting controls, or auditing matters, and the confidential, anonymous submission by employees of the investment adviser, administrator, principal underwriter or any other provider of accounting-related services for a listed fund, as well as employees of the fund, if any, regarding questionable accounting or auditing matters, as and when required by applicable rules or listing requirements. The procedures currently in effect are attached as Exhibit A.

18. To report regularly to the Board of Trustees, including providing the Audit Committee's conclusions with respect to the independent auditor and the funds' financial statements and accounting controls.

E. Subcommittees. The Audit Committee may, to the extent permitted by applicable law, form and delegate authority to one or more subcommittees (including a subcommittee consisting of a single member), as it deems appropriate from time to time under the circumstances. Any decision of a subcommittee to preapprove audit or non-audit services shall be presented to the full Audit Committee at its next meeting.

F. Additional Responsibilities. The Committee shall serve as the "qualified legal compliance committee" (as such term is defined in 17 CFR Part 205)("QLCC"), the duties of which are listed on Exhibit B to this charter; and shall also perform other tasks assigned to it from time to time by the Board of Trustees, and will report findings and recommendations to the Board of Trustees, as appropriate.

G. Funding. Each fund shall provide for appropriate funding, as determined by the Audit Committee, in its capacity as a committee of the Board of Trustees, for payment of:

1. Compensation to any registered public accounting firm engaged for the purpose of preparing or issuing an audit report or performing other audit, review or attest services for the fund.

2. Compensation to any counsel, advisers, experts or consultants engaged by the Audit Committee under Paragraph J of this charter.

3. Ordinary administrative expenses of the Audit Committee that are necessary or appropriate in carrying out its duties.

H. Governance. One member of the Committee shall be appointed as chair. The chair shall be responsible for leadership of the Committee, including scheduling meetings or reviewing and approving the schedule for them, preparing agendas or reviewing and approving them before meetings, presiding over meetings, and making reports to the Board of Trustees, as appropriate. The designation of a person as an "audit committee financial expert", within the meaning of the rules under Section 407 of the Sarbanes-Oxley Act of 2002, shall not impose any greater responsibility or liability on that person than the responsibility and liability imposed on such person as a member of the Committee, nor shall it decrease the duties and obligations of other Committee members or the Board of Trustees. Any additional compensation of Audit Committee members shall be as determined by the Board of Trustees. No member of the Audit Committee may receive, directly or indirectly, any consulting, advisory or other compensatory fee from a fund, other than fees paid in his or her capacity as a member of the Board of Trustees or a committee of the Board of Trustees. The members of the Audit Committee should confirm that the minutes of the Audit Committee's meetings accurately describe the issues considered by the Committee, the process the Committee used to discuss and evaluate such issues and the Committee's final determination of how to proceed. The minutes should document the Committee's consideration of issues in a manner that demonstrates that the Committee acted with due care.

I. Evaluation. At least annually, the Audit Committee shall evaluate its own performance, including whether the Audit Committee is meeting frequently enough to discharge its responsibilities appropriately.

J. Miscellaneous. The Committee shall meet as often as it deems appropriate, with or without management, as circumstances require. The Committee shall have the resources and authority appropriate to discharge its responsibilities, including the authority to retain special counsel and other advisers, experts or consultants, at the funds' expense, as it determines necessary to carry out its duties. The Committee shall have direct access to such officers of and service providers to the funds as it deems desirable.

K. Review. The Committee shall review this charter at least annually

and shall recommend such changes to the Board of Trustees as it deems desirable.

EXHIBIT A

Policy for Raising and Investigating Complaints or Concerns About Accounting or Auditing Matters

As contemplated by the Audit Committee Charter, the Committee has established the following procedures for:

• the receipt, retention and treatment of complaints received by a fund regarding accounting, internal accounting controls or auditing matters; and

• the confidential, anonymous submission by employees of the investment adviser, administrator, principal underwriter or any other provider of accounting-related services for a listed fund, as well as employees of the fund ("covered persons") of concerns regarding questionable accounting or auditing matters.

A. Policy Objectives

The objective of this policy is to provide a mechanism by which complaints and concerns regarding accounting, internal accounting controls or auditing matters may be raised and addressed without the fear or threat of retaliation. The funds desire and expect that covered persons will report any complaints or concerns they may have regarding accounting, internal accounting controls or auditing matters.

B. Procedures for Raising Complaints and Concerns

The funds' Secretary shall be responsible for communicating these procedures to covered persons. Covered persons with complaints regarding accounting, internal accounting controls or auditing matters or concerns regarding questionable accounting or auditing matters may submit such complaints or concerns to the attention of the funds' Secretary by sending a letter or other writing to the funds' principal executive offices. Complaints and concerns may be made anonymously. Alternatively, any complaints or concerns may also be communicated anonymously directly to any member of the Audit Committee.

C. Procedures for Investigating and Resolving Complaints and Concerns

If any complaints or concerns regarding internal accounting controls or auditing matters that could affect the funds are received through the

Ethics Line or any other similar facility maintained by John Hancock Financial Services, they shall be communicated promptly to the funds' Secretary and shall be reported by the funds' Secretary to the Audit Committee, promptly or quarterly according to the guidelines set forth below.

The funds' Secretary shall report to the Audit Committee as to whether those responsible for the Ethics Line or similar facility have a procedure in place to communicate promptly any such complaints or concerns to the funds' Secretary, and whether any such communication would violate the terms thereof.

All complaints and concerns received will be promptly forwarded to the Audit Committee or the chair of the Audit Committee, unless they are determined to be without merit by Secretary of the funds. If sent only to the chair, the chair may determine the appropriate response or may refer the issues to the entire Audit Committee. In any event, the funds' Secretary will provide a record of all complaints and concerns received (whether or not determined to have merit) to the Audit Committee quarterly.

The Audit Committee will evaluate any complaints or concerns received (including those reported to the committee on a quarterly basis and which the funds' Secretary has previously determined to be without merit). If the Audit Committee requires additional information to evaluate any complaint or concern, it may conduct an investigation, including interviews of persons believed to have relevant information. The Audit Committee may, in its discretion, assume responsibility for directing or conducting any investigation or may delegate such responsibility to another person or entity.

After its evaluation of the complaint or concern, the Audit Committee will authorize such follow-up actions, if any, as deemed necessary and appropriate to address the substance of the complaint or concern. The funds reserve the right to take whatever action the Audit Committee believes appropriate, up to and including discharge of any employee deemed to have engaged in improper conduct.

Regardless of whether a complaint or concern is submitted anonymously, the Audit Committee will strive to keep all complaints and concerns and the identity of those who submit them and participate in any investigation as confidential as possible, limiting disclosure to those with a business need to know or as required by law or recommended by legal counsel.

No covered person shall penalize or retaliate against any other covered person for reporting a complaint or concern, unless it is determined that the complaint or concern was made with knowledge that it was false. The funds will not tolerate retaliation against any covered person for

submitting, or for cooperating in the investigation of, a complaint or concern. Moreover, any such retaliation is unlawful and may result in criminal action. Any retaliation will warrant disciplinary action against the offending party, up to and including termination of employment.

John Hancock Advisers, LLC shall include this policy in its employee manual and shall distribute, at least annually, the policy to all of its employees.

The funds' Secretary shall retain records of all complaints and concerns received, and the disposition thereof, for five years.

D. Notification of Others

At any time during an evaluation or investigation of a complaint or concern, the chair of the Audit Committee may notify the funds' CCO, the QLCC, or any other party with a need to know of the receipt of a complaint or concern and/or the progress or results of any review and/or investigation of a complaint or concern. The chair of the Audit Committee may provide such level of detail as may be necessary to allow the appropriate consideration by such parties in light of the funds' ongoing obligations, including, but not limited to, disclosure obligations or any required officer certifications.

EXHIBIT B

QLCC DUTIES AND RESPONSIBILITIES

The QLCC shall adopt written procedures for the confidential receipt, retention, and consideration of any report of evidence of a material violation.

The QLCC has the authority and responsibility, once a report of evidence of a material violation by a fund, its officers, directors, employees or agents has been received by the QLCC:

1. to inform the CLO and CEO of such report (except in the case where the reporting attorney reasonably believes that it would be futile to report evidence of a material violation to the CLO and CEO, and has informed the QLCC of such belief); and

2. to determine whether an investigation is necessary or appropriate, and, if it determines an investigation is necessary or appropriate, to:

(A) notify the Board of Trustees;

(B) notify the funds' CCO;

(C) initiate an investigation, which may be conducted either by the CLO or by outside attorneys; and

(D) retain such additional expert personnel as the QLCC deems necessary;

and, at the conclusion of such investigation, to:

(A) recommend, by majority vote, that the fund implement an appropriate response to evidence of a material violation; and

(B) inform the CLO, CEO the funds' CCO and the Board of Trustees of the results of any such investigation and the appropriate remedial measures.

3. by majority vote, to take all other appropriate action, including notifying the U.S. Securities and Exchange Commission in the event that the fund fails in any material respect to implement an appropriate response that the QLCC has recommended.

EX-99

JOHN HANCOCK FUNDS

GOVERNANCE COMMITTEE CHARTER

A. Composition. The Governance Committee shall be composed entirely of Trustees who are "independent" as defined in the rules of the New York Stock Exchange ("NYSE") and the NASDAQ Stock Market, Inc. ("NASDAQ") or any other exchange, as applicable, and are not "interested persons" as defined in the Investment Company Act of 1940 of any of the funds, or of any fund's investment adviser or principal underwriter (the "Independent Trustees") who are designated for membership from time to time by the Board of Trustees. The Chairman of the Board shall be a member of the Governance Committee.

B. Overview. The overall charter of the Governance Committee is to make recommendations to the Board on issues related to corporate governance applicable to the Independent Trustees and to the composition and operation of the Board, and to assume duties, responsibilities and functions to recommend nominees to the Board, together with such additional duties, responsibilities and functions as are delegated to it from time to time.

C. Specific Responsibilities. The Governance Committee shall have the following duties and powers, to be exercised at such times and in such manner as the Committee shall deem necessary or appropriate:

1. Except where the funds are legally required to nominate individuals recommended by others, to recommend to the Board of Trustees individuals for nomination to serve as Trustees.

2. To consider, as it deems necessary or appropriate, the criteria for persons to fill existing or newly created Trustee vacancies. The Governance Committee shall use the criteria and principles set forth in Annex A to guide its Trustee selection process.

3. To consider and recommend the amount of compensation to be paid by the funds to the Independent Trustees, including incremental amounts, if any, payable to Committee Chairmen, and to address compensation-related matters.

4. To consider and recommend the duties and compensation of the Chairman of the Board.

5. To consider and recommend changes to the Board regarding the size, structure, and composition of the Board.

6. To evaluate, from time to time, the retirement policies for the Independent Trustees.

7. To develop and recommend to the Board guidelines for corporate governance ("Corporate Governance Guidelines") for the funds that take into account the rules of the NYSE and any applicable law or regulation, and to periodically review and assess the Corporate Governance Guidelines and recommend any proposed changes to the Board for approval.

8. To monitor all expenditures of the Board or the Committees or the Independent Trustees not otherwise incurred and/or monitored by a particular Committee, including, but not limited to: legal, consulting, and D&O insurance costs; association dues, including Investment Company Institute membership dues; meeting expenditures and policies relating to

reimbursement of travel expenses and expenses associated with offsite meetings; expenses associated with Trustee attendance at educational or informational conferences; and publication expenses.

9. To consider, evaluate and make recommendations and necessary findings regarding independent legal counsel and any other advisers, experts or consultants, that may be engaged by the Board of Trustees, by the Trustees who are not "interested persons" as defined in the Investment Company Act of 1940 of any of the funds or any fund's investment adviser or principal underwriter, or by the Governance Committee, from time to time, other than as may be engaged directly by another Committee.

10. To periodically review the Board's committee structure and the charters of the Board's committees, and recommend to the Board of Trustees changes to the committee structure and charters as it deems appropriate.

11. To coordinate and administer an annual self-evaluation of the Board, which will include, at a minimum, a review of its effectiveness in overseeing the number of funds in the fund complex and the effectiveness of its committee structure.

12. To report its activities to Board of Trustees and to make such recommendations with respect to the matters described above and other matters as the Governance Committee may deem necessary or appropriate.

D. Additional Responsibilities. The Committee will also perform other tasks assigned to it from time to time by the Chairman of the Board or by the Board of Trustees, and will report findings and recommendations to the Board of Trustees, as appropriate.

E. Governance. One member of the Committee shall be appointed as chair. The chair shall be responsible for leadership of the Committee, including scheduling meetings or reviewing and approving the schedule for them, preparing agendas or reviewing and approving them before meetings, and making reports to the Board of Trustees, as appropriate.

F. Miscellaneous. The Committee shall meet as often as it deems appropriate, with or without management, as circumstances require. The Committee shall have the resources and authority appropriate to discharge its responsibilities, including the authority to retain special counsel and other advisers, experts or consultants, at the funds' expense, as it determines necessary to carry out its duties. The Committee shall have direct access to such officers of and service providers to the funds as it deems desirable.

G. Review. The Committee shall review this Charter periodically and recommend such changes to the Board of Trustees as it deems desirable.

ANNEX A

General Criteria

1. Nominees should have a reputation for integrity, honesty and adherence to high ethical standards.

2. Nominees should have demonstrated business acumen, experience and ability to exercise sound judgments in matters that relate to the current and long-term objectives of the funds and should be willing and able to contribute positively to the decision-making process of the funds.

3. Nominees should have a commitment to understand the funds, and the responsibilities of a trustee/director of an investment company and to regularly attend and participate in meetings of the Board and its committees.

4. Nominees should have the ability to understand the sometimes conflicting interests of the various constituencies of the funds, including shareholders and the management company, and to act in the interests of all shareholders.

5. Nominees should not have, nor appear to have, a conflict of interest that would impair their ability to represent the interests of all the shareholders and to fulfill the responsibilities of a director/trustee.

Application of Criteria to Existing Trustees

The renomination of existing Trustees should not be viewed as automatic, but should be based on continuing qualification under the criteria set forth above. In addition, the Governance Committee shall consider the existing Trustee's performance on the Board and any committee.

Review of Shareholder Nominations

Any shareholder nomination must be submitted in compliance with all of the pertinent provisions of Rule 14a-8 under the Securities Exchange Act of 1934 in order to be considered by the Governance Committee. In evaluating a nominee recommended by a shareholder, the Governance Committee, in addition to the criteria discussed above, may consider the objectives of the shareholder in submitting that nomination and whether such objectives are consistent with the interests of all shareholders. If the Board determines to include a shareholder's candidate among the slate of its designated nominees, the candidate's name will be placed on the funds' proxy card. If the Board determines not to include such candidate among its designated nominees, and the shareholder has satisfied the requirements of Rule 14a-8, the shareholder's candidate will be treated as a nominee of the shareholder who originally nominated the candidate. In that case, the candidate will not be named on the proxy card distributed with the funds' proxy statement.

As long as an existing Independent Trustee continues, in the opinion of the Governance Committee, to satisfy the criteria listed above, the Committee generally would favor the re-nomination of an existing Trustee rather than a new candidate. Consequently, while the Governance Committee will consider nominees recommended by shareholders to serve as trustees, the Governance Committee may only act upon such recommendations if there is a vacancy on the Board, or the Governance Committee determines that the selection of a new or additional Trustee is in the best interests of the fund. In the event that a vacancy arises or a change in Board membership is determined to be advisable, the Governance Committee will, in addition to any shareholder recommendations, consider candidates identified by other means, including candidates proposed by members of the Governance Committee. The Governance Committee may retain a consultant to assist the Committee in a search for a qualified candidate.

EX-99

JOHN HANCOCK FUNDS

PROXY VOTING POLICIES

John Hancock Advisers, LLC
MFC Global Investment Management (U.S.), LLC
(formerly known as Sovereign Asset Management LLC)
Proxy Voting Guidelines

We believe in placing our clients' interests first. Before we invest in a particular stock or bond, our team of portfolio managers and research analysts look closely at the company by examining its earnings history, its management team and its place in the market. Once we invest, we monitor all our clients' holdings, to ensure that they maintain their potential to produce results for investors.

As part of our active investment management strategy, we keep a close eye on each company we invest in. Routinely, companies issue proxies by which they ask investors like us to vote for or against a change, such as a new management team, a new business procedure or an acquisition. We base our decisions on how to vote these proxies with the goal of maximizing the value of our clients' investments.

Currently, John Hancock Advisers, LLC ("JHA") and MFC Global Investment Management (U.S.), LLC ("MFC") manage open-end funds, closed-end funds and portfolios for institutions and high-net-worth investors. Occasionally, we utilize the expertise of an outside asset manager by means of a subadvisory agreement. In all cases, JHA or MFC makes the final decision as to how to vote our clients' proxies. There is one exception, however, and that pertains to our international accounts. The investment management team for international investments votes the proxies for the accounts they manage. Unless voting is specifically retained by the named fiduciary of the client, JHA and MFC will vote proxies for ERISA clients.

In order to ensure a consistent, balanced approach across all our investment teams, we have established a proxy oversight group comprised of associates from our investment, operations and legal teams. The group has developed a set of policies and procedures that detail the standards for how JHA and MFC vote proxies. The guidelines of JHA have been approved and adopted by each fund client's board of trustees who have voted to delegate proxy voting authority to their investment adviser, JHA. JHA and MFC's other clients have granted us the authority to vote proxies in our advisory contracts or comparable documents.

JHA and MFC have hired a third party proxy voting service which has been instructed to vote all proxies in accordance with our established guidelines except as otherwise instructed.

In evaluating proxy issues, our proxy oversight group may consider information

from many sources, including the portfolio manager, management of a company presenting a proposal, shareholder groups, and independent proxy research services. Proxies for securities on loan through securities lending programs will generally not be voted, however a decision may be made to recall a security for voting purposes if the issue is material.

Below are the guidelines we adhere to when voting proxies. Please keep in mind that these are purely guidelines. Our actual votes will be driven by the particular circumstances of each proxy. From time to time votes may ultimately be cast on a case-by-case basis, taking into consideration relevant facts and circumstances at the time of the vote. Decisions on these matters (case-by-case, abstention, recall) will normally be made by a portfolio manager under the supervision of the chief investment officer and the proxy oversight group. We may abstain from voting a proxy if we conclude that the effect on our clients' economic interests or the value of the portfolio holding is indeterminable or insignificant.

Proxy Voting Guidelines

Board of Directors

We believe good corporate governance evolves from an independent board.

We support the election of uncontested director nominees, but will withhold our vote for any nominee attending less than 75% of the board and committee meetings during the previous fiscal year. Contested elections will be considered on a case by case basis by the proxy oversight group, taking into account the nominee's qualifications. We will support management's ability to set the size of the board of directors and to fill vacancies without shareholder approval but will not support a board that has fewer than 3 directors or allows for the removal of a director without cause.

We will support declassification of a board and block efforts to adopt a classified board structure. This structure typically divides the board into classes with each class serving a staggered term.

In addition, we support proposals for board indemnification and limitation of director liability, as long as they are consistent with corporate law and shareholders' interests. We believe that this is necessary to attract qualified board members.

Selection of Auditors

We believe an independent audit committee can best determine an auditor's qualifications.

We will vote for management proposals to ratify the board's selection of auditors, and for proposals to increase the independence of audit committees.

Capitalization

We will vote for a proposal to increase or decrease authorized common or preferred stock and the issuance of common stock, but will vote against a proposal to issue or convert preferred or multiple classes of stock if the board has unlimited rights to set the terms and conditions of the shares, or if the shares have voting rights inferior or superior to those of other shareholders.

In addition, we will support a management proposal to: create or restore preemptive rights; approve a stock repurchase program; approve a stock split or reverse stock split; and, approve the issuance or exercise of stock warrants

Acquisitions, mergers and corporate restructuring

Proposals to merge with or acquire another company will be voted on a case-by-case basis, as will proposals for recapitalization, restructuring, leveraged buyout, sale of assets, bankruptcy or liquidation. We will vote against a reincorporation proposal if it would reduce shareholder rights. We will vote against a management proposal to ratify or adopt a poison pill or to establish a supermajority voting provision to approve a merger or other business combination. We would however support a management proposal to opt out of a state takeover statutory provision, to spin-off certain operations or divisions and to establish a fair price provision.

Corporate Structure and Shareholder Rights

In general, we support proposals that foster good corporate governance procedures and that provide shareholders with voting power equal to their equity interest in the company.

To preserve shareholder rights, we will vote against a management proposal to restrict shareholders' right to: call a special meeting and to eliminate a shareholders' right to act by written consent. In addition, we will not support a management proposal to adopt a supermajority vote requirement to change certain by-law or charter provisions or a non-technical amendment to by-laws or a charter that reduces shareholder rights.

Equity-based compensation

Equity-based compensation is designed to attract, retain and motivate talented executives and independent directors, but should not be so significant as to materially dilute shareholders' interests.

We will vote against the adoption or amendment of a stock option plan if the:

• plan dilution is more than 10% of outstanding common stock,

• plan allows for non-qualified options to be priced at less than 85% of the fair market value on the grant date,

• company allows or has allowed the re-pricing or replacement of underwater options in the past fiscal year (or the exchange of underwater options).

With respect to the adoption or amendment of employee stock purchase plans or a stock award plan, we will vote against management if:

• the plan allows stock to be purchased at less than 85% of fair market value;

• this plan dilutes outstanding common equity greater than 10%;

• all stock purchase plans, including the proposed plan, exceed 15% of outstanding common equity.

Other Business

For routine business matters which are the subject of many proxy related questions, we will vote with management proposals to:

• change the company name;

• approve other business;

• adjourn meetings;

• make technical amendments to the by-laws or charters;

• approve financial statements;

• approve an employment agreement or contract.

Shareholder Proposals

Shareholders are permitted per SEC regulations to submit proposals for inclusion in a company's proxy statement. We will generally vote against shareholder proposals and in accordance with the recommendation of management except as

follows where we will vote for proposals:;

• calling for shareholder ratification of auditors;

• calling for auditors to attend annual meetings;

• seeking to increase board independence;

• requiring minimum stock ownership by directors;

• seeking to create a nominating committee or to increase the independence of the nominating committee;

• seeking to increase the independence of the audit committee.

Corporate and social policy issues

We believe that "ordinary business matters" are primarily the responsibility of management and should be approved solely by the corporation's board of directors.

Proposals in this category, initiated primarily by shareholders, typically request that the company disclose or amend certain business practices. We generally vote against business practice proposals and abstain on social policy issues, though we may make exceptions in certain instances where we believe a proposal has substantial economic implications.

John Hancock Advisers, LLC
MFC Global Investment Management (U.S.), LLC
(formerly known as Sovereign Asset Management LLC)
Proxy Voting Procedures

The role of the proxy voting service

John Hancock Advisers, LLC ("JHA") and MFC Global Investment Management (U.S.), LLC ("MFC") have hired a proxy voting service to assist with the voting of client proxies. The proxy service coordinates with client custodians to ensure that proxies are received for securities held in client accounts and acted on in a timely manner. The proxy service votes all proxies received in accordance with the proxy voting guidelines established and adopted by JHA and MFC. When it is unclear how to apply a particular proxy voting guideline or when a particular proposal is not covered by the guidelines, the proxy voting service will contact the proxy oversight group coordinator for a resolution.

The role of the proxy oversight group and coordinator

The coordinator will interact directly with the proxy voting service to resolve any issues the proxy voting service brings to the attention of JHA or MFC. When a question arises regarding how a proxy should be voted the coordinator contacts the firm's investment professionals and the proxy oversight group for a resolution. In addition the coordinator ensures that the proxy voting service receives responses in a timely manner. Also, the coordinator is responsible for identifying whether, when a voting issue arises, there is a potential conflict of interest situation and then escalating the issue to the firm's Executive Committee. For securities out on loan as part of a securities lending program, if a decision is made to vote a proxy, the coordinator will manage the return/recall of the securities so the proxy can be voted.

The role of mutual fund trustees

The boards of trustees of our mutual fund clients have reviewed and adopted the proxy voting guidelines of the funds' investment adviser, JHA. The trustees will periodically review the proxy voting guidelines and suggest changes they deem advisable.

Conflicts of interest

Conflicts of interest are resolved in the best interest of clients.

With respect to potential conflicts of interest, proxies will be voted in accordance with JHA's or MFC's predetermined policies. If application of the predetermined policy is unclear or does not address a particular proposal, a special internal review by the JHA Executive Committee or MFC Executive Committee will determine the vote. After voting, a report will be made to the client (in the case of an investment company, to the fund's board of trustees), if requested. An example of a conflict of interest created with respect to a proxy solicitation is when JHA or MFC must vote the proxies of companies that they provide investment advice to or are currently seeking to provide investment advice to, such as to pension plans.