-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, OiU33uBIxLetH9aQdNrh6dgQOv8lO50XqRMd8Kh/5qTf13o+QkurKONqlO+54M8n pWnTkQiU9D8pDbeolcoR2w== 0000846800-00-000002.txt : 20000302 0000846800-00-000002.hdr.sgml : 20000302 ACCESSION NUMBER: 0000846800-00-000002 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19991231 FILED AS OF DATE: 20000229 FILER: COMPANY DATA: COMPANY CONFORMED NAME: DREYFUS LIFE & ANNUITY INDEX FUND INC CENTRAL INDEX KEY: 0000846800 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] STATE OF INCORPORATION: NY FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: N-30D SEC ACT: SEC FILE NUMBER: 811-05719 FILM NUMBER: 556824 BUSINESS ADDRESS: STREET 1: 144 GLENN CURTISS BLVD CITY: UNIONDALE STATE: NY ZIP: 11566 BUSINESS PHONE: 2129226785 MAIL ADDRESS: STREET 1: C/O DREYFUS CORP STREET 2: 200 PARK AVENUE, 8TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10166 N-30D 1 ANNUAL REPORT TO SHAREHOLDERS Dreyfus Stock Index Fund ANNUAL REPORT December 31, 1999 (reg.tm) The views expressed herein are current to the date of this report. These views and the composition of the fund's portfolio are subject to change at any time based on market and other conditions. * Not FDIC-Insured * Not Bank-Guaranteed * May Lose Value Year 2000 Issues (Unaudited) The fund could be adversely affected if the computer systems used by Dreyfus and the fund's other service providers do not properly process and calculate date-related information from and after January 1, 2000. Dreyfus has taken steps designed to avoid year 2000-related problems in its systems and to monitor the readiness of other service providers. In addition, issuers of securities in which the fund invests may be adversely affected by year 2000-related problems. This could have an impact on the value of the fund's investments and its share price. Contents THE FUND - -------------------------------------------------- 2 Letter from the President 3 Discussion of Fund Performance 6 Fund Performance 7 Statement of Investments 22 Statement of Financial Futures 23 Statement of Assets and Liabilities 24 Statement of Operations 25 Statement of Changes in Net Assets 26 Financial Highlights 27 Notes to Financial Statements 31 Report of Independent Accountants 32 Important Tax Information FOR MORE INFORMATION - --------------------------------------------------------------------------- Back Cover The Fund Dreyfus Stock Index Fund LETTER FROM THE PRESIDENT Dear Shareholder: We are pleased to present this annual report for Dreyfus Stock Index Fund, covering the 12-month period from January 1, 1999 through December 31, 1999. Inside, you' ll find valuable information about how the fund was managed during the reporting period, including a discussion with the fund's portfolio managers, Steven Falci and Jocelin Reed. The past year has been both highly volatile and rewarding for many investors in U.S. stocks. On December 31, the last trading day of 1999, most major stock market indices hit new highs, including the Dow Jones Industrial Average, the S& P 500 Index of large-cap stocks, the technology-heavy Nasdaq 100 and the Russell 2000 Index of small-capitalization stocks. These simultaneous highs masked the remarkable narrowness of the stock market's advance in 1999, however. Following the trend established over the past several years, growth-oriented stocks handily outperformed value-oriented stocks. Indeed, until a more broad-based rally in the fourth quarter, stellar performance was generally limited to a handful of highly valued technology and telecommunications companies. In our view, many fundamentally sound companies in other market sectors may be selling at attractive valuations. We appreciate your confidence over the past year, and we look forward to your continued participation in Dreyfus Stock Index Fund. Sincerely, Stephen E. Canter President and Chief Investment Officer The Dreyfus Corporation January 14, 2000 DISCUSSION OF FUND PERFORMANCE Steven Falci and Jocelin Reed, Portfolio Managers How did Dreyfus Stock Index Fund perform relative to its benchmark? For the 12-month period ended December 31, 1999, Dreyfus Stock Index Fund produced a total return of 20.60% .(1) In contrast, the Standard & Poor's 500((reg.tm)) Composite Stock Price Index ("S&P 500") produced a total return of 21.03% for the same period.(2) The difference in returns is primarily due to transaction costs and other fund operating expenses. What is the fund's investment approach? The fund seeks to match the total return of the S&P 500 Index. To pursue this goal, the fund generally invests in all 500 stocks in the S&P 500 in proportion to their weighting in the Index. Often considered a barometer for the stock market in general, the S&P 500 is made up of 500 widely held common stocks. It is dominated by large blue chip stocks, which, when combined, cover nearly 75% of the total U.S. market capitalization. However, it is important to note that the S&P 500 is not composed of the 500 largest companies; rather, it is designed to capture the returns of many different sectors of the U.S. economy. Accordingly, it is composed of 376 industrial, 41 utility, 72 financial and 11 transportation stocks. Each stock is weighted by its market capitalization; that is, larger companies have greater representation in the S& P 500 than smaller ones. The fund may also use stock index futures as a substitute for the sale or purchase of stocks. Dreyfus Stock Index Fund uses a passive management approach: all investment decisions are made based on the fund's objective, which is to seek to match the performance of the S& P 500. The fund does not attempt to manage market volatility. The Fund DISCUSSION OF FUND PERFORMANCE (CONTINUED) What other factors influenced the fund's performance? At the beginning of the fund's 12-month reporting period, and following the trend of the past few years, the growth of the U.S. equity market was dominated by large-cap growth stocks. However in April, market sentiment began to shift away from domestic large-cap growth stocks to include a broader group of companies, including small- and mid-cap names. By August however, the equity market began to narrow, once again favoring large-cap growth names. That narrowing intensified even further in mid-October and continued through the end of the year, led primarily by optimism in technology names. To illustrate the importance of the fourth calendar quarter's performance, let's look at the gains of the S&P 500 on a quarterly basis. By the end of the second quarter, the S&P 500 had recorded gains of approximately 10%. By the end of the third quarter, however, the S&P 500 was down approximately 6%, leaving the index with about a 4% positive return going into the fourth quarter. Gains from the fourth quarter were approximately 14%, which enabled the S&P 500 to complete the calendar year with a total return of more than 20%. During the reporting period, the largest gains within the S&P 500, and therefore for the fund as well, came from its technology group, which includes electronic instruments, communications equipment, electrical equipment, electronic semiconductor and computer software companies. In addition, the S&P 500's holdings within the broadcast media and basic materials areas provided strong returns, as did its retail apparel stores and healthcare stocks. On the other hand, the poorest performing returns of the S&P 500, and therefore for the fund as well during the reporting period, were generated from its pollution control, tobacco, office equipment and supplies, manufactured housing and supermarket chain holdings. In addition, the stocks of specialty printing, toys, and homebuilding stocks provided disappointing returns. What is the fund's current strategy? As a passively managed index fund, our strategy is to hold all 500 stocks that make up the S& P 500 in an effort to closely match the Index's returns We are pleased that the overall stock market recorded another positive year in 1999 and that the fund was successful in its goal of producing a return that is similar to the S& P 500. We would also like to take this time to remind shareholders that the benefit of investing in an index fund, such as Dreyfus Stock Index Fund, is that it represents an inexpensive way for investors to obtain broad exposure to the U.S. stock market, and to the large-cap asset class in particular. January 14, 2000 (1) TOTAL RETURN INCLUDES REINVESTMENT OF DIVIDENDS AND ANY CAPITAL GAINS PAID. PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. SHARE PRICE AND INVESTMENT RETURN FLUCTUATE SUCH THAT UPON REDEMPTION, FUND SHARES MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. THE FUND'S PERFORMANCE DOES NOT REFLECT THE DEDUCTION OF ADDITIONAL CHARGES AND EXPENSES IMPOSED IN CONNECTION WITH INVESTING IN VARIABLE INSURANCE CONTRACTS, WHICH WILL REDUCE RETURNS. (2) SOURCE: LIPPER ANALYTICAL SERVICES, INC. -- REFLECTS THE REINVESTMENT OF INCOME DIVIDENDS AND, WHERE APPLICABLE, CAPITAL GAIN DISTRIBUTIONS. THE STANDARD & POOR'S 500(reg.tm) COMPOSITE STOCK PRICE INDEX IS A WIDELY ACCEPTED, UNMANAGED INDEX OF U.S. STOCK MARKET PERFORMANCE. The Fund FUND PERFORMANCE Comparison of change in value of $10,000 investment in Dreyfus Stock Index Fund and the Standard & Poor's 500 Composite Stock Price Index - -------------------------------------------------------------------------------- Average Annual Total Returns AS OF 12/31/99 Inception From Date 1 Year 5 Years 10 Years Inception - ------------------------------------------------------------------------------------------------------------------------------------ FUND 9/29/89 20.60% 28.07% 17.70% 17.46%
((+)) SOURCE: LIPPER ANALYTICAL SERVICES, INC. PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE. The fund's performance does not reflect the deduction of additional charges and expenses imposed in connection with investing in variable insurance contracts which will reduce returns. THE ABOVE GRAPH COMPARES A $10,000 INVESTMENT MADE IN DREYFUS STOCK INDEX FUND ON 9/29/89 (INCEPTION DATE) TO A $10,000 INVESTMENT MADE IN THE STANDARD & POOR'S 500 COMPOSITE STOCK PRICE INDEX ON THAT DATE. ALL DIVIDENDS AND CAPITAL GAIN DISTRIBUTIONS ARE REINVESTED. THE FUND'S PERFORMANCE SHOWN IN THE LINE GRAPH TAKES INTO ACCOUNT ALL APPLICABLE FEES AND EXPENSES OF THE FUND. THE STANDARD & POOR'S 500 COMPOSITE STOCK PRICE INDEX IS A WIDELY ACCEPTED, UNMANAGED INDEX OF U.S. STOCK MARKET PERFORMANCE, WHICH DOES NOT TAKE INTO ACCOUNT CHARGES, FEES AND OTHER EXPENSES. FURTHER INFORMATION RELATING TO FUND PERFORMANCE, INCLUDING EXPENSE REIMBURSEMENTS, IF APPLICABLE, IS CONTAINED IN THE FINANCIAL HIGHLIGHTS SECTION OF THE PROSPECTUS AND ELSEWHERE IN THIS REPORT. STATEMENT OF INVESTMENTS December 31, 1999 COMMON STOCKS--98.7% Shares Value ($) - -------------------------------------------------------------------------------- ALCOHOL & TOBACCO--1.0% Anheuser-Busch Cos. 196,100 13,898,588 Brown-Forman, Cl. B 28,700 1 ,643,075 Coors (Adolph), Cl. B 15,400 808,500 Philip Morris Cos. 1,002,700 23,250,106 Seagram 181,400 8,151,663 UST 73,000 1,838,688 49,590,620 CONSUMER CYCLICAL--9.3% AMR 63,100(a) 4,227,700 Albertson's 176,377 5,688,158 AutoZone 62,400(a) 2,016,300 Bed Bath & Beyond 58,600(a) 2,036,350 Best Buy 85,500(a) 4,291,031 Black & Decker 36,500 1,907,125 Brunswick 38,600 858,850 CVS 164,300 6,561,731 Circuit City Group 84,300 3,798,769 Consolidated Stores 46,200(a) 750,750 Cooper Tire and Rubber 31,800 494,888 Costco Wholesale 92,600(a) 8,449,750 Dana 69,506 2,080,836 Darden Restaurants 55,400 1,004,125 Dayton Hudson 185,500 13,622,656 Delphi Automotive Systems 237,003 3,732,797 Delta Air Lines 58,900 2,933,956 Dillard's, Cl. A 44,900 906,419 Dollar General 94,250 2,144,188 Eastman Kodak 132,800 8,798,000 Federated Department Stores 87,500(a) 4,424,219 Ford Motor 507,500 27,119,531 Gap 359,700 16,546,200 General Motors 270,200 19,640,163 Grainger (W.W.) 39,200 1,874,250 Great Atlantic & Pacific 16,100 448,788 Harrah's Entertainment 53,800(a) 1,422,338 Hasbro 81,675 1,556,930 Hilton Hotel 155,400 1,495,725 The Fund STATEMENT OF INVESTMENTS (CONTINUED) COMMON STOCKS (CONTINUED) Shares Value ($) - -------------------------------------------------------------------------------- CONSUMER CYCLICAL (CONTINUED) Home Depot 963,000 66,025,688 K mart 207,100(a) 2,083,944 Kohl's 68,300(a) 4,930,406 Kroger 348,000 6,568,500 Leggett & Platt 82,500 1,768,594 Limited 89,800 3,889,463 Liz Claiborne 25,800 970,725 Longs Drug Stores 16,500 425,906 Lowes 160,000 9,560,000 Marriott International, Cl. A 104,400 3,295,125 Mattel 176,300 2,313,938 May Department Stores 140,150 4,519,838 Maytag 36,600 1,756,800 McDonald's 568,300 22,909,594 Mirage Resorts 83,500(a) 1,278,594 NIKE, Cl. B 118,000 5,848,375 Navistar International 27,800(a) 1,317,025 Nordstrom 58,800 1,539,825 Office Depot 157,200(a) 1,719,375 PACCAR 32,800 1,453,450 Penney (J.C.) 110,600 2,205,088 Pep Boys-Manny, Moe & Jack 22,100 201,663 Polaroid 18,600 349,913 Reebok International 23,500(a) 192,406 Rite Aid 108,600 1,214,963 Russell 14,000 234,500 Safeway 214,100(a) 7,613,931 Sara Lee 379,000 8,361,688 Sears, Roebuck & Co. 159,600 4,857,825 Southwest Airlines 211,450 3,422,847 Springs Industries 7,500 299,531 Staples 194,950(a) 4,045,213 TJX Cos. 133,300 2,724,319 Tandy 81,100 3,989,106 Toys R Us 103,900(a) 1,487,069 Tricon Global Restaurants 64,360(a) 2,485,905 US Airways Group 30,000(a) 961,875 COMMON STOCKS (CONTINUED) Shares Value ($) - -------------------------------------------------------------------------------- CONSUMER CYCLICAL (CONTINUED) V.F. 49,900 1,497,000 Wal-Mart Stores 1,866,800 129,042,550 Walgreen 421,000 12,314,250 Wendy's International 50,900 1,049,813 Whirlpool 31,600 2,055,975 Winn-Dixie Stores 62,300 1,491,306 487,106,424 CONSUMER STAPLES--5.2% Alberto-Culver, Cl. B 23,400 604,013 Archer Daniels Midland 259,015 3,156,745 Avon Products 109,400 3,610,200 Bestfoods 117,000 6,149,813 Campbell Soup 182,100 7,044,994 Clorox 99,000 4,987,125 Coca-Cola 1,035,800 60,335,350 Coca-Cola Enterprises 178,300 3,588,288 Colgate-Palmolive 244,600 15,899,000 ConAgra 204,800 4,620,800 Fortune Brands 69,800 2,307,763 General Mills 128,200 4,583,150 Gillette 455,200 18,748,550 Heinz (H.J.) 150,400 5,987,800 Hershey Foods 58,500 2,778,750 International Flavors & Fragrances 44,500 1,679,875 Kellogg 170,000 5,238,125 Nabisco Group Holdings 136,800 1,453,500 National Service Industries 17,000 501,500 Newell Rubbermaid 118,271 3,429,859 PepsiCo 613,400 21,622,350 Procter & Gamble 550,300 60,292,244 Quaker Oats 56,100 3,681,563 Ralston-Purina Group 135,700 3,782,638 SUPERVALU 58,300 1,166,000 Sysco 138,800 5,491,275 Tupperware 24,200 409,888 Unilever, N.V. 239,789 13,053,514 The Fund STATEMENT OF INVESTMENTS (CONTINUED) COMMON STOCKS (CONTINUED) Shares Value ($) - -------------------------------------------------------------------------------- CONSUMER STAPLES (CONTINUED) Wrigley, (Wm) Jr 48,800 4,047,350 270,252,022 ENERGY--6.0% Amerada Hess 38,000 2,156,500 Anadarko Petroleum 53,500 1,825,688 Apache 47,800 1,765,613 Atlantic Richfield 135,200 11,694,800 Baker Hughes 137,920 2,904,940 Burlington Resources 91,290 3,018,276 Chevron 275,200 23,839,200 Coastal 89,500 3,171,656 Columbia Energy Group 34,450 2,178,963 Conoco, Cl. B 263,036 6,543,010 Consolidated Natural Gas 40,200 2,610,488 Eastern Enterprises 11,300 649,044 El Paso Energy 95,600 3,710,475 Enron 299,500 13,290,313 Exxon Mobil 1,446,169 116,507,013 Halliburton 185,100 7,450,275 McDermott International 24,900 225,656 Nicor 19,800 643,500 ONEOK 13,300 334,163 Occidental Petroleum 146,200 3,161,575 Peoples Energy 14,900 499,150 Phillips Petroleum 106,300 4,996,100 Rowan Cos. 34,900(a) 756,894 Royal Dutch Petroleum 899,500 54,363,531 Schlumberger 229,700 12,920,625 Sunoco 38,000 893,000 Texaco 231,900 12,595,069 Tosco 63,900 1,737,281 Transocean Sedco Forex 132,670 4,469,318 USX-Marathon Group 129,500 3,197,031 Union Pacific Resources Group 105,644 1,346,961 Unocal 101,700 3,413,306 Williams Cos. 182,100 5,565,431 314,434,845 COMMON STOCKS (CONTINUED) Shares Value ($) - -------------------------------------------------------------------------------- HEALTH CARE--9.5% ALZA 42,600(a) 1,475,025 Abbott Laboratories 638,200 23,174,638 Allergan 55,400 2,756,150 American Home Products 548,100 21,615,694 Amgen 427,800(a) 25,694,738 Bard (C.R.) 21,500 1,139,500 Bausch & Lomb 24,100 1,649,344 Baxter International 122,100 7,669,406 Becton, Dickinson & Co. 105,000 2,808,750 Biomet 47,200 1,888,000 Boston Scientific 173,500(a) 3,795,313 Bristol-Myers Squibb 833,200 53,481,025 Cardinal Health 114,250 5,469,719 Columbia/HCA Healthcare 236,650 6,936,803 Guidant 126,700 5,954,900 HEALTHSOUTH 174,100(a) 935,788 Humana 70,300(a) 575,581 Johnson & Johnson 582,400 54,236,000 Lilly (Eli) & Co. 458,400 30,483,600 Mallinckrodt Group 29,800 948,013 Manor Care 44,900(a) 718,400 McKesson HBOC 118,046 2,663,413 Medtronic 492,300 17,938,181 Merck & Co. 978,200 65,600,538 Pfizer 1,625,500 52,727,156 Pharmacia & Upjohn 212,500 9,562,500 Schering-Plough 616,000 25,987,500 Service Corp. International 114,100 791,569 Sigma-Aldrich 42,300 1,271,644 St. Jude Medical 35,500(a) 1,089,406 Tenet Healthcare 130,300(a) 3,062,050 Tyco International 701,972 27,289,162 United HealthCare 72,700 3,862,188 Warner-Lambert 358,600 29,382,788 Watson Pharmaceuticals 40,200(a) 1,439,663 Wellpoint Health Networks 27,600(a) 1,819,875 497,894,020 The Fund STATEMENT OF INVESTMENTS (CONTINUED) COMMON STOCKS (CONTINUED) Shares Value ($) - -------------------------------------------------------------------------------- INTEREST SENSITIVE--17.4% AFLAC 111,500 5,261,406 Aetna 62,799 3,504,969 Allstate 334,900 8,037,600 American Express 188,500 31,338,125 American General 104,515 7,930,076 American International Group 649,425 70,219,078 Amsouth Bancorp 165,050 3,187,528 Aon 107,425 4,297,000 Associates First Capital, Cl. A 305,438 8,380,455 BB&T 134,000 3,668,250 Bank One 492,010 15,775,071 Bank of America 714,646 35,866,296 Bank of New York 308,500 12,340,000 Bear Stearns Cos. 51,327 2,194,229 Block (H&R) 41,000 1,793,750 CIGNA 78,000 6,283,875 Capital One Financial 82,800 3,989,925 Cendant 302,148(a) 8,025,806 Chase Manhattan 349,200 27,128,475 Chubb 73,900 4,161,494 Cincinnati Financial 69,200 2,158,175 Citigroup 1,411,911 78,449,305 Comerica 65,600 3,062,700 Conseco 137,201 2,452,468 Countrywide Credit Industries 47,400 1,196,850 Equifax 60,300 1,420,819 Federal Home Loan Mortgage 291,600 13,723,425 Federal National Mortgage Association 430,000 26,848,125 Fifth Third Bancorp 126,625 9,291,109 First Union 401,290 13,167,328 Firstar 413,133 8,727,435 Fleet Boston Financial 386,586 13,458,025 Franklin Resources 105,800 3,392,213 General Electric 1,373,800 212,595,496 Golden West Financial 69,300 2,321,550 Hartford Financial Services Group 94,800 4,491,150 Household International 200,825 7,480,731 Huntington Bancshares 96,635 2,307,161 COMMON STOCKS (CONTINUED) Shares Value ($) - -------------------------------------------------------------------------------- INTEREST SENSITIVE (CONTINUED) Jefferson-Pilot 44,250 3,020,063 Keycorp 188,200 4,163,925 Lehman Brothers Holdings 50,300 4,259,781 Lincoln National 83,400 3,336,000 Loews 45,100 2,737,006 MBIA 41,900 2,212,844 MBNA 336,387 9,166,546 MGIC Investment 45,800 2,756,588 Marsh & McLennan Cos. 110,750 10,597,391 Mellon Financial 215,700 7,347,281 Merrill Lynch 155,000 12,942,500 Morgan (J.P.) 73,600 9,319,600 Morgan Stanley Dean Witter & Co. 233,167 33,284,589 National City 259,300 6,142,169 Northern Trust 93,600 4,960,800 Old Kent Financial 49,800 1,761,675 Paine Webber Group 61,100 2,371,444 PNC Bank 127,500 5,673,750 Progressive 30,600 2,237,625 Providian Financial 59,500 5,418,219 Regions Financial 93,900 2,359,238 Republic New York 44,000 3,168,000 SLM Holding 67,500 2,851,875 Safeco 55,200 1,373,100 Schwab (Charles) 343,050 13,164,544 SouthTrust 70,300 2,658,219 St. Paul Companies 95,090 3,203,344 State Street 67,600 4,939,025 Summit Bancorp 74,300 2,275,438 SunTrust Banks 135,000 9,289,688 Synovus Financial 113,800 2,261,775 T. Rowe Price Associates 50,900 1,880,119 Torchmark 55,800 1,621,688 U.S. Bancorp 306,915 7,308,413 Union Planters 60,000 2,366,250 UnumProvident 100,144 3,210,867 Wachovia 84,800 5,766,400 Washington Mutual 242,909 6,315,634 The Fund STATEMENT OF INVESTMENTS (CONTINUED) COMMON STOCKS (CONTINUED) Shares Value ($) - -------------------------------------------------------------------------------- INTEREST SENSITIVE (CONTINUED) Wells Fargo 691,900 27,978,706 907,629,592 PRODUCER GOODS--6.7% Air Products & Chemicals 96,200 3,228,713 Alcan Aluminium 94,800 3,904,575 Alcoa 153,800 12,765,400 Allegheny Technologies 39,966 896,737 Armstrong World Industries 16,800 560,700 Ashland 30,300 998,006 Avery Dennison 47,700 3,476,138 Ball 12,800 504,000 Barrick Gold 163,600 2,893,675 Bemis 21,900 763,763 Bethlehem Steel 54,900(a) 459,788 Boeing 391,524 16,272,716 Boise Cascade 23,900 967,950 Briggs & Stratton 9,800 525,525 Burlington Northern Santa Fe 195,000 4,728,750 CSX 91,300 2,864,538 Caterpillar 149,200 7,021,725 Centex 25,000 617,188 Champion International 40,300 2,496,081 Cooper Industries 39,600 1,601,325 Crane 28,375 563,953 Crown Cork & Seal 51,300 1,147,838 Cummins Engine 17,600 850,300 Deere & Co. 98,000 4,250,750 Dow Chemical 92,300 12,333,588 duPont (E.I.) deNemours & Co. 437,632 28,829,008 Eastman Chemical 32,800 1,564,150 Ecolab 54,300 2,124,488 Emerson Electric 182,300 10,459,463 Engelhard 52,800 996,600 FDX 124,740(a) 5,106,544 FMC 13,300(a) 762,256 Fleetwood Enterprises 14,000 288,750 Fluor 31,800 1,458,825 COMMON STOCKS (CONTINUED) Shares Value ($) - -------------------------------------------------------------------------------- PRODUCER GOODS (CONTINUED) Fort James 92,700 2,537,663 Foster Wheeler 17,100 151,763 Freeport-McMoRan Copper, Cl. B 68,600 1,449,175 General Dynamics 83,600 4,409,900 Genuine Parts 75,150 1,864,659 Georgia-Pacific 71,900 3,648,925 Goodrich (B.F.) 46,100 1,267,750 Goodyear Tire & Rubber 65,600 1,849,100 Grace (W.R.) & Co. 29,900(a) 414,863 Great Lakes Chemical 24,500 935,594 Hercules 44,500 1,240,438 Homestake Mining 109,200 853,125 Honeywell International 331,113 19,101,052 ITT Industries 36,900 1,233,844 Illinois Tool Works 125,700 8,492,606 Inco 80,500 1,891,750 Ingersoll-Rand 69,250 3,813,078 International Paper 173,460 9,789,649 Kansas City Southern Industries 46,400 3,462,600 Kaufman & Broad Home 20,100 486,169 Kerr-McGee 36,258 2,247,996 Kimberly-Clark 223,500 14,583,375 Lockheed Martin 165,800 3,626,875 Louisiana-Pacific 45,100 642,675 Masco 185,800 4,714,675 Mead 42,900 1,863,469 Milacron 15,500 238,313 Minnesota Mining & Manufacturing 169,000 16,540,875 Monsanto 265,844 9,470,693 NACCO Industries, Cl. A 3,433 190,746 Newmont Mining 70,319 1,722,816 Norfolk Southern 159,600 3,271,800 Northrop Grumman 29,100 1,573,219 Nucor 36,600 2,006,138 Owens-Corning 23,000 444,188 Owens-Illinois 65,400(a) 1,639,088 PPG Industries 72,800 4,554,550 The Fund STATEMENT OF INVESTMENTS (CONTINUED) COMMON STOCKS (CONTINUED) Shares Value ($) - -------------------------------------------------------------------------------- PRODUCER GOODS (CONTINUED) Pactiv 71,500(a) 759,688 Pall 52,101 1,123,428 Parker-Hannifin 45,550 2,337,284 Phelps Dodge 32,733 2,197,203 Placer Dome 136,600 1,468,450 Potlach 12,100 539,963 Praxair 66,900 3,365,906 Pulte 18,100 407,250 Raytheon, Cl. B 141,700 3,763,906 Reynolds Metals 26,400 2,022,900 Rockwell International 80,300 3,844,363 Rohm & Haas 91,406 3,719,082 Sealed Air 35,112(a) 1,819,241 Sherwin-Williams 71,000 1,491,000 Snap-On 27,550 731,797 Stanley Works 37,300 1,123,663 TRW 50,900 2,643,619 Temple-Inland 23,400 1,542,938 Textron 63,000 4,831,313 Thomas & Betts 23,900 761,813 Timken 26,000 531,375 USX-U.S. Steel Group 37,100 1,224,300 Union Carbide 55,900 3,731,325 Union Pacific 104,000 4,537,000 United Technologies 202,100 13,136,500 Vulcan Materials 42,000 1,677,375 Westvaco 42,000 1,370,250 Weyerhaeuser 98,900 7,102,256 Willamette Industries 46,800 2,173,275 Worthington Industries 38,500 637,656 353,125,119 SERVICES--8.3% ALLTEL 128,000 10,584,000 Allied Waste Industries 79,100 697,069 America Online 935,800(a) 70,594,413 American Greetings, Cl. A 28,300 668,588 Automatic Data Processing 259,600 13,985,950 COMMON STOCKS (CONTINUED) Shares Value ($) - -------------------------------------------------------------------------------- SERVICES (CONTINUED) CBS 319,871 20,451,752 Carnival 257,300(a) 12,302,156 Ceridian 60,700(a) 1,308,844 Clear Channel Communications 141,600 12,637,800 Comcast, Cl. A 314,400 15,798,600 Computer Sciences 67,100(a) 6,349,338 Deluxe 31,800 872,513 Disney (Walt) 865,100 25,304,175 Donnelley (R.R.) & Sons 53,600 1,329,950 Dow Jones & Co 38,100 2,590,800 Dun & Bradstreet 67,500 1,991,250 Electronic Data Systems 196,900 13,179,994 First Data 180,000 8,876,250 Gannett 117,300 9,567,281 Harcourt General 29,800 1,199,450 IMS Health 131,200 3,567,000 Interpublic Group Cos. 118,300 6,824,431 Jostens 14,200(a) 345,238 Knight-Ridder 34,000 2,023,000 McGraw-Hill Cos. 82,600 5,090,225 MediaOne Group 254,400(a) 19,541,100 Meredith 21,800 908,788 New York Times, Cl. A 73,000 3,586,125 NEXTEL Communications, Cl. A 151,700(a) 15,644,063 Omnicom Group 74,400 7,440,000 Paychex 103,150 4,126,000 Quintiles Transnational 48,100(a) 898,869 Ryder System 26,900 657,369 Shared Medical Systems 11,200 570,500 Sprint (PCS Group) 179,800(a) 18,429,500 Time Warner 542,600 39,304,588 Times Mirror, Cl. A 25,100 1,681,700 Tribune 99,400 5,473,213 Viacom, Cl. B 292,202(a) 17,659,958 Waste Management 259,772 4,464,831 Yahoo 110,400(a) 47,768,700 436,295,371 The Fund STATEMENT OF INVESTMENTS (CONTINUED) COMMON STOCKS (CONTINUED) Shares Value ($) - -------------------------------------------------------------------------------- TECHNOLOGY--26.7% ADC Telecommunications 64,200(a) 4,658,513 Adaptec 43,300(a) 2,159,588 Adobe Systems 51,200 3,443,200 Advanced Micro Devices 61,800(a) 1,788,338 Analog Devices 72,500(a) 6,742,500 Andrew 34,450(a) 652,397 Apple Computer 67,500(a) 6,939,844 Applied Materials 157,500(a) 19,953,281 Autodesk 24,700 833,625 BMC Software 100,400 8,025,725 Cabletron Systems 73,000(a) 1,898,000 Cisco Systems 1,369,450(a) 146,702,331 Citrix Systems 38,300(a) 4,710,900 Compaq Computer 713,172 19,300,217 Computer Associates International 225,525 15,772,655 Compuware 149,800(a) 5,580,050 Comverse Technology 29,300(a) 4,241,175 Corning 102,700 13,241,881 Danaher 59,600 2,875,700 Dell Computer 1,065,900(a) 54,360,900 Dover 87,400 3,965,775 EMC 425,100 46,442,175 Eaton 30,300 2,200,538 Gateway 131,400(a) 9,469,013 General Instrument 72,700(a) 6,179,500 Hewlett-Packard 425,000 48,423,438 Ikon Office Solutions 62,600 426,463 Intel 1,398,600 115,122,263 International Business Machines 754,900 81,529,200 Johnson Controls 35,800 2,036,125 KLA-Tencor 37,000(a) 4,120,875 LSI Logic 61,800(a) 4,171,500 Lexmark International Group, Cl. A 54,000(a) 4,887,000 Lucent Technologies 1,311,747 98,135,072 Micron Technology 113,000 8,785,750 Microsoft 2,160,000(a) 252,180,000 Millipore 18,900 730,013 COMMON STOCKS (CONTINUED) Shares Value ($) - -------------------------------------------------------------------------------- TECHNOLOGY (CONTINUED) Molex 64,900 3,679,019 Motorola 254,700 37,504,575 National Semiconductor 70,500(a) 3,018,281 Network Appliance 61,800(a) 5,133,263 Nortel Networks 556,740 56,230,740 Novell 140,500(a) 5,611,219 Oracle 595,875(a) 66,775,242 PE Biosystems Group 42,800 5,149,375 Parametric Technology 113,000(a) 3,058,063 PeopleSoft 111,500(a) 2,376,344 PerkinElmer 19,200 800,400 Pitney Bowes 112,200 5,420,663 QUALCOMM 276,000(a) 48,645,000 Scientific-Atlanta 32,100 1,785,563 Seagate Technology 87,400(a) 4,069,563 Silicon Graphics 79,200(a) 777,150 Solectron 122,600(a) 11,662,325 Sun Microsystems 649,200(a) 50,272,425 3COM 150,000(a) 7,050,000 Tektronix 19,700 765,838 Tellabs 164,300(a) 10,546,006 Teradyne 71,800(a) 4,738,800 Texas Instruments 335,600 32,511,250 Thermo Electron 66,200 993,000 Unisys 128,400 4,100,775 Xerox 278,200 6,311,663 Xilinx 132,600(a) 6,029,156 1,397,701,218 UTILITIES--8.6% AT&T 1,340,565 68,033,674 AES 86,400(a) 6,458,400 Ameren 57,600 1,886,400 American Electric Power 81,100 2,605,338 Bell Atlantic 651,360 40,099,350 BellSouth 790,900 37,024,006 CINergy 66,700 1,609,138 CMS Energy 49,500 1,543,781 The Fund STATEMENT OF INVESTMENTS (CONTINUED) COMMON STOCKS (CONTINUED) Shares Value ($) - -------------------------------------------------------------------------------- UTILITIES (CONTINUED) Carolina Power & Light 66,900 2,036,269 Central & Southwest 89,200 1,784,000 CenturyTel 58,550 2,773,806 Consolidated Edison 92,700 3,198,150 Constellation Energy Group 62,700 1,818,300 DTE Energy 60,800 1,907,600 Dominion Resources 80,500 3,159,625 Duke Energy 153,109 7,674,589 Edison International 145,700 3,815,519 Entergy 103,500 2,665,125 FPL Group 75,200 3,219,500 FirstEnergy 98,100 2,225,644 Florida Progress 41,200 1,743,275 GPU 52,600 1,574,713 GTE 411,500 29,036,469 Global Crossing 322,240(a) 16,112,000 MCI WorldCom 1,188,654(a) 63,072,954 New Century Energies 48,300 1,467,113 Niagara Mohawk Power 78,600(a) 1,095,488 Northern States Power 64,700 1,261,650 PG&E 161,100 3,302,550 PP&L Resources 66,200 1,514,325 PECO Energy 78,300 2,720,925 Pinnacle West Capital 35,600 1,088,025 Public Service Enterprise Group 92,000 3,202,750 Reliant Energy 124,139 2,839,680 SBC Communications 1,432,262 69,822,773 Sempra Energy 100,791 1,751,244 Southern 286,600 6,735,100 Sprint (FON Group) 363,900 24,495,019 Texas Utilities 115,930 4,122,761 U S West 211,666 15,239,952 UniCom 91,200 3,055,200 450,792,180 TOTAL COMMON STOCKS (cost $3,403,393,884) 5,164,821,411 Principal SHORT-TERM INVESTMENTS--1.3% Amount ($) Value ($) - -------------------------------------------------------------------------------- REPURCHASE AGREEMENTS--1.2% Greenwich Capital Markets, 2.8% dated 12/31/1999, due 1/3/2000 in the amount of $60,614,140 (fully collateralized by $51,850,000 U.S. Treasury Inflation Protected Securities, 3.375%, 1/15/2007; $8,990,000 U.S. Treasury Inflation Protected Securities, 3.875%, 1/15/2009, total value $61,816,371) 60,600,000 60,600,000 U.S. TREASURY BILLS--.1% 5.07%, 3/2/2000 5,062,000(b) 5,019,935 TOTAL SHORT-TERM INVESTMENTS (cost $65,618,513) 65,619,935 - ------------------------------------------------------------------------------------------------------------------------------------ TOTAL INVESTMENTS (cost $3,469,012,397) 100.0% 5,230,441,346 LIABILITIES, LESS CASH AND RECEIVABLES .0% (735,043) NET ASSETS 100.0% 5,229,706,303 A NON-INCOME PRODUCING. B PARTIALLY HELD BY THE CUSTODIAN IN A SEGREGATED ACCOUNT AS COLLATERAL FOR OPEN FINANCIAL FUTURES POSITIONS. SEE NOTES TO FINANCIAL STATEMENTS.
The Fund STATEMENT OF FINANCIAL FUTURES December 31, 1999 Market Value Unrealized Covered Appreciation Contracts by Contracts ($) Expiration at 12/31/99 ($) - ------------------------------------------------------------------------------------------------------------------------------------ FINANCIAL FUTURES LONG Standard & Poor's 500 170 63,078,500 March 2000 1,621,440 SEE NOTES TO FINANCIAL STATEMENTS.
STATEMENT OF ASSETS AND LIABILITIES December 31, 1999 Cost Value - ------------------------------------------------------------------------------------------------------------------------------------ ASSETS ($): Investments in securities--See Statement of Investments --Note 1(b) 3,469,012,397 5,230,441,346 Cash 57,209 Receivable for shares of Common Stock subscribed 8,523,006 Dividends and interest receivable 4,609,615 Receivable for investment securities sold 440,296 Receivable for futures variation margin--Note 4(a) 134,822 Prepaid expenses 47,822 5,244,254,116 - ------------------------------------------------------------------------------------------------------------------------------------ LIABILITIES ($): Due to The Dreyfus Corporation and affiliates 1,063,468 Payable for shares of Common Stock redeemed 10,008,479 Payable for investment securities purchased 3,117,039 Accrued expenses 358,827 14,547,813 - ------------------------------------------------------------------------------------------------------------------------------------ NET ASSETS ($) 5,229,706,303 - ------------------------------------------------------------------------------------------------------------------------------------ COMPOSITION OF NET ASSETS ($): Paid-in capital 3,470,181,617 Accumulated undistributed investment income--net 646,347 Accumulated net realized gain (loss) on investments (4,172,050) Accumulated net unrealized appreciation (depreciation) on investments (including $1,621,440 net unrealized appreciation on financial futures)--Note 4(b) 1,763,050,389 - ------------------------------------------------------------------------------------------------------------------------------------ NET ASSETS ($) 5,229,706,303 - ------------------------------------------------------------------------------------------------------------------------------------ SHARES OUTSTANDING (200 million shares of $.001 par value Common Stock authorized) 136,011,886 NET ASSET VALUE, offering and redemption price per share ($) 38.45 SEE NOTES TO FINANCIAL STATEMENTS.
The Fund STATEMENT OF OPERATIONS Year Ended December 31, 1999 - ------------------------------------------------------------------------------- INVESTMENT INCOME ($): INCOME: Cash dividends (net of $537,410 foreign taxes withheld at source) 53,998,178 Interest 5,925,047 TOTAL INCOME 59,923,225 EXPENSES: Management fee--Note 3(a) 10,577,826 Registration fees 277,786 Prospectus and shareholders' reports 71,142 Professional fees 51,484 Directors' fees and expenses--Note 3(c) 46,846 Loan commitment fees--Note 2 34,591 Shareholder servicing costs--Note 3(b) 13,041 Miscellaneous 258,613 TOTAL EXPENSES 11,331,329 INVESTMENT INCOME--NET 48,591,896 - ------------------------------------------------------------------------------- REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS--NOTE 4 ($): Net realized gain (loss) on investments 8,464,981 Net realized gain (loss) on financial futures 15,612,800 NET REALIZED GAIN (LOSS) 24,077,781 Net unrealized appreciation (depreciation) on investments [including ($617,496) net unrealized (depreciation) on financial futures] 754,135,017 NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS 778,212,798 NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS 826,804,694 SEE NOTES TO FINANCIAL STATEMENTS. STATEMENT OF CHANGES IN NET ASSETS Year Ended December 31, ------------------------------------- 1999 1998 - ------------------------------------------------------------------------------- OPERATIONS ($): Investment income--net 48,591,896 34,943,946 Net realized gain (loss) on investments 24,077,781 17,387,491 Net unrealized appreciation (depreciation) on investments 754,135,017 593,180,285 NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 826,804,694 645,511,722 - ------------------------------------------------------------------------------- DIVIDENDS TO SHAREHOLDERS FROM ($): Investment income--net (47,945,549) (35,513,218) Net realized gain on investments (41,840,248) (6,552,514) TOTAL DIVIDENDS (89,785,797) (42,065,732) - ------------------------------------------------------------------------------- CAPITAL STOCK TRANSACTIONS ($): Net proceeds from shares sold 1,770,669,411 1,531,271,100 Dividends reinvested 89,785,797 42,065,732 Cost of shares redeemed (808,309,981) (604,913,124) INCREASE (DECREASE) IN NET ASSETS FROM CAPITAL STOCK TRANSACTIONS 1,052,145,227 968,423,708 TOTAL INCREASE (DECREASE) IN NET ASSETS 1,789,164,124 1,571,869,698 - ------------------------------------------------------------------------------- NET ASSETS ($): Beginning of Period 3,440,542,179 1,868,672,481 END OF PERIOD 5,229,706,303 3,440,542,179 Undistributed investment income--net 646,347 -- - ------------------------------------------------------------------------------- CAPITAL SHARE TRANSACTIONS (SHARES): Shares sold 50,987,939 52,994,265 Shares issued for dividends reinvested 2,504,918 1,413,619 Shares redeemed (23,266,719) (21,196,391) NET INCREASE (DECREASE) IN SHARES OUTSTANDING 30,226,138 33,211,493 SEE NOTES TO FINANCIAL STATEMENTS. The Fund FINANCIAL HIGHLIGHTS The following table describes the performance for the fiscal periods indicated. Total return shows how much your investment in the fund would have increased (or decreased) during each period, assuming you had reinvested all dividends and distributions. These figures have been derived from the fund's financial statements. Year Ended December 31, ---------------------------------------------------- 1999 1998 1997 1996 1995 - ------------------------------------------------------------------------------------------------------------------------- PER SHARE DATA ($): Net asset value, beginning of period 32.52 25.75 20.28 17.20 12.94 Investment Operations: Investment income--net .40(a) .37 .37 .39 .33 Net realized and unrealized gain (loss) on investments 6.24 6.85 6.26 3.43 4.39 Total from Investment Operations 6.64 7.22 6.63 3.82 4.72 Distributions: Dividends from investment income--net (.38) (.38) (.37) (.39) (.33) Dividends from net realized gain on investments (.33) (.07) (.79) (.35) (.13) Total Distributions (.71) (.45) (1.16) (.74) (.46) Net asset value, end of period 38.45 32.52 25.75 20.28 17.20 - ------------------------------------------------------------------------------------------------------------------------- TOTAL RETURN (%) 20.60 28.21 32.96 22.54 36.78 - ------------------------------------------------------------------------------------------------------------------------- RATIOS/SUPPLEMENTAL DATA (%): Ratio of expenses to average net assets .26 .26 .28 .30 .39 Ratio of net investment income to average net assets 1.13 1.35 1.66 2.24 2.38 Decrease reflected in above expense ratios due to undertakings by The Dreyfus Corporation -- -- -- -- .03 Portfolio Turnover Rate 2.64 2.40 3.53 10.92 11.95 - ------------------------------------------------------------------------------------------------------------------------- Net Assets, end of period ($ x 1,000) 5,229,706 3,440,542 1,868,672 813,959 312,686 (A) BASED ON AVERAGE SHARES OUTSTANDING AT EACH MONTH END. SEE NOTES TO FINANCIAL STATEMENTS.
NOTES TO FINANCIAL STATEMENTS NOTE 1--Significant Accounting Policies: Dreyfus Stock Index Fund (the "fund") is registered under the Investment Company Act of 1940, as amended (the "Act"), as a non-diversified open-end management investment company, that is intended to be a funding vehicle for variable annuity contracts and variable life insurance policies to be offered by the separate accounts of life insurance companies. The fund's investment objective is to provide investment results that correspond to the price and yield performance of publicly traded common stocks as represented by the Standard and Poor' s 500 Composite Stock Price Index. The Dreyfus Corporation ("Dreyfus") serves as the fund's manager and Mellon Equity Associates ("Mellon Equity"), an affiliate of Dreyfus, serves as the fund's index manager. Dreyfus is a direct subsidiary of Mellon Bank, N.A., which is a wholly-owned subsidiary of Mellon Financial Corporation. Premier Mutual Fund Services, Inc. is the distributor of the fund's shares, which are sold without a sales charge. The fund' s financial statements are prepared in accordance with generally accepted accounting principles which may require the use of management estimates and assumptions. Actual results could differ from those estimates. (A) PORTFOLIO VALUATION: Investments in securities (including financial futures) are valued at the last sales price on the securities exchange on which such securities are primarily traded or at the last sales price on the national securities market. Securities not listed on an exchange or the national securities market, or securities for which there were no transactions, are valued at the average of the most recent bid and asked prices. Bid price is used when no asked price is available. Securities for which there are no such valuations are valued at fair value as determined in good faith under the direction of the Board of Directors. (B) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities transactions are recorded on a trade date basis. Realized gain and loss from securities transactions are recorded on the identified cost basis. Dividend income is recognized on the ex-dividend date and interest The Fund NOTES TO FINANCIAL STATEMENTS (CONTINUED) income, including, where applicable, amortization of discount on investments, is recognized on the accrual basis. The fund may enter into repurchase agreements with financial institutions, deemed to be creditworthy by the fund' s Manager, subject to the seller's agreement to repurchase and the fund's agreement to resell such securities at a mutually agreed upon price. Securities purchased subject to repurchase agreements are deposited with the fund's custodian and, pursuant to the terms of the repurchase agreement, must have an aggregate market value greater than or equal to the repurchase price plus accrued interest at all times. If the value of the underlying securities falls below the value of the repurchase price plus accrued interest, the fund will require the seller to deposit additional collateral by the next business day. If the request for additional collateral is not met, or the seller defaults on its repurchase obligation, the fund maintains the right to sell the underlying securities at market value and may claim any resulting loss against the seller. (C) DIVIDENDS TO SHAREHOLDERS: Dividends are recorded on the ex-dividend date. Dividends from investment income-net are declared and paid on a quarterly basis. Dividends from net realized capital gain are normally declared and paid annually, but the fund may make distributions on a more frequent basis to comply with the distribution requirements of the Internal Revenue Code of 1986, as amended (the "Code"). To the extent that net realized capital gain can be offset by capital loss carryovers, if any, it is the policy of the fund not to distribute such gain. (D) FEDERAL INCOME TAXES: It is the policy of the fund to continue to qualify as a regulated investment company, if such qualification is in the best interests of its shareholders, by complying with the applicable provisions of the Code, and to make distributions of taxable income sufficient to relieve it from substantially all Federal income and excise taxes. NOTE 2--Bank Line of Credit: The fund participates with other Dreyfus-managed funds in a $500 million redemption credit facility (the "Facility" ) to be utilized for temporary or emergency purposes, including the financing of redemptions. In connection therewith, the fund has agreed to pay commitment fees on its pro rata portion of the Facility. Interest is charged to the fund at rates based on prevailing market rates in effect at the time of borrowings. During the period ended December 31, 1999, the fund did not borrow under the Facility. NOTE 3--Management Fee, Index Management Fee and Other Transactions With Affiliates: (A) Pursuant to an Management Agreement with Dreyfus, the management fee is computed at the annual rate of .245 of 1% of the value of the fund's average daily net assets, and is payable monthly. Dreyfus has agreed to pay Mellon Equity, a monthly index-management fee at the annual rate of .095 of 1% of the value of the fund' s average daily net assets. Dreyfus has undertaken from January 1, 1999 until such a time as they give shareholders at least 180 days notice to the contrary that if any full fiscal year the fund's aggregate expenses exclusive of brokerage commissions, transaction fees and extraordinary expenses, exceed an annual rate of .40 of 1% of the fund's average daily net assets, the fund may deduct from the payments to be made to Dreyfus, or Dreyfus will bear, such excess expense. During the period ended December 31, 1999, there was no expense reimbursement pursuant to the undertaking. (B) Under the Shareholder Services Plan, the fund reimburses Dreyfus Service Corporation, a wholly-owned subsidiary of Dreyfus, an amount not to exceed an annual rate of .25 of 1% of the value of the fund's average daily net assets for certain allocated expenses with respect to servicing and/or maintaining shareholder accounts. During the period ended December 31, 1999, the fund was charged $4,760 pursuant to the Shareholder Services Plan. The fund compensates Dreyfus Transfer, Inc., a wholly-owned subsidiary of Dreyfus, under a transfer agency agreement for providing personnel and facilities to perform transfer agency services for the fund. During the period ended December 31, 1999, the fund was charged $714 pursuant to the transfer agency agreement. The Fund NOTES TO FINANCIAL STATEMENTS (CONTINUED) (C) Each director who is not an "affiliated person" as defined in the Act receives from the fund an annual fee of $2,500 and an attendance fee of $500 per meeting. The Chairman of the Board receives an additional 25% of such compensation. NOTE 4--Securities Transactions: (A) The aggregate amount of purchases and sales of investment securities, excluding short-term securities and financial futures, during the period ended December 31, 1999, amounted to $1,153,224,572 and $110,379,290, respectively. The fund may invest in financial futures contracts in order to gain exposure to or protect against changes in the market. The fund is exposed to market risk as a result of changes in the value of the underlying financial instruments. Investments in financial futures require the fund to "mark to market" on a daily basis, which reflects the change in the market value of the contract at the close of each day's trading. Typically, variation margin payments are received or made to reflect daily unrealized gains or losses. When the contracts are closed, the fund recognizes a realized gain or loss. These investments require initial margin deposits with a custodian, which consist of cash or cash equivalents, up to approximately 10% of the contract amount. The amount of these deposits is determined by the exchange or Board of Trade on which the contract is traded and is subject to change. Contracts open at December 31, 1999 are set forth in the Statement of Financial Futures. (B) At December 31, 1999, accumulated net unrealized appreciation on investments and financial futures was $1,763,050,389, consisting of $1,942,416,593 gross unrealized appreciation and $179,366,204 gross unrealized depreciation. At December 31, 1999, the cost of investments for Federal income tax purposes was substantially the same as the cost for financial reporting purposes (see the Statement of Investments). REPORT OF INDEPENDENT ACCOUNTANTS To the Board of Directors and Shareholders of Dreyfus Stock Index Fund In our opinion, the accompanying statement of assets and liabilities, including the statements of investments and financial futures, 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 Dreyfus Stock Index Fund (the "Fund" ) at December 31, 1999, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States. 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 auditing standards generally accepted in the United States, which require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at December 31, 1999 by correspondence with the custodian and brokers, provide a reasonable basis for the opinion expressed above. PricewaterhouseCoopers LLP New York, New York February 4, 2000 The Fund IMPORTANT TAX INFORMATION (Unaudited) For Federal tax purposes, the fund hereby designates $.1320 per share as a long-term capital gain distribution of the $.2700 per share paid on December 30, 1999 and also designates $.1110 per share as a long-term capital gain distribution of the $.2410 per share paid on March 31, 1999. The fund also designates 87.52% of the ordinary dividends paid during the fiscal year ended December 31, 1999 as qualifying for the corporate dividends received deduction. For More Information Dreyfus Stock Index Fund 200 Park Avenue New York, NY 10166 Manager The Dreyfus Corporation 200 Park Avenue New York, NY 10166 Index Fund Manager Mellon Equity Associates 500 Grant Street Pittsburgh, PA 15258 Custodian Boston Safe Deposit and Trust Company One Boston Place Boston, MA 02109 Transfer Agent & Dividend Disbursing Agent Dreyfus Transfer, Inc. P.O. Box 9671 Providence, RI 02940 Distributor Premier Mutual Fund Services, Inc. 60 State Street Boston, MA 02109 To obtain information: BY TELEPHONE Call 1-800-554-4611 or 516-338-3300 BY MAIL Write to: The Dreyfus Family of Funds 144 Glenn Curtiss Boulevard Uniondale, NY 11556-0144 Attn: Institutional Servicing (c) 2000 Dreyfus Service Corporation 763AR9912 EX-99 2 GRAPH IN THE PRESIDENT'S LETTER COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN DREYFUS STOCK INDEX FUND AND THE STANDARD & POOR'S 500 COMPOSITE STOCK PRICE INDEX EXHIBIT A: STANDARD & POOR'S 500 PERIOD COMPOSITE STOCK DREYFUS STOCK PRICE INDEX* INDEX FUND 9/29/89 10,000 10,000 12/31/89 10,205 10,216 12/31/90 9,888 9,860 12/31/91 12,893 12,803 12/31/92 13,875 13,713 12/31/93 15,270 14,993 12/31/94 15,471 15,125 12/31/95 21,278 20,688 12/31/96 26,161 25,350 12/31/97 34,885 33,704 12/31/98 44,862 43,213 12/31/99 54,298 52,116 *Source: Lipper Analytical Services, Inc. -----END PRIVACY-ENHANCED MESSAGE-----