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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 811-21448
Pioneer Tax Advantaged Balanced Trust
(Exact name of registrant as specified in charter)
60 State Street, Boston, MA 02109
(Address of principal executive offices) (ZIP code)
Dorothy E. Bourassa, Pioneer Investment Management, Inc.,
60 State Street, Boston, MA 02109
(Name and address of agent for service)
Registrant's telephone number, including area code: (617) 742-7825
Date of fiscal year end: November 30
Date of reporting period: December 1, 2003 through November 30, 2004
Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. ss. 3507.
item 1.REPORTS TO SHAREOWNERS.
PIONEER
-----------------------
TAX ADVANTAGED
BALANCED
TRUST
Annual
Report
11/30/04
[LOGO] PIONEER
Investments(R)
Table of Contents
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Letter to Shareowners 1
Portfolio Summary 2
Performance Update 3
Portfolio Management Discussion 4
Schedule of Investments 7
Financial Statements 21
Notes to Financial Statements 25
Report of Independent Registered Public Accounting Firm 34
Trustees, Officers and Service Providers 35
Pioneer Family of Mutual Funds 42
Pioneer Tax Advantaged Balanced Trust
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LETTER TO SHAREOWNERS 11/30/04
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Dear Shareowner,
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High energy prices and rising interest rates caused concern among investors
during the third quarter of 2004. As oil prices touched $50 per barrel for the
first time, many consumers, faced with high priced gasoline and anticipating a
winter of hefty heating bills, responded by holding back on spending. Consumers
account for the bulk of the nation's economic activity, and retail sales over
the summer were erratic. Beyond soaring energy costs, which have the effect of
a tax increase on individuals and businesses, the slack job creation data of
the last few months also undermined confidence in the economic outlook. The
markets in general fell during the third quarter. Continued unsettled
conditions in Iraq and the ever present specter of terrorism also weighed on
investors' minds. Overseas, global markets were fairly stable, after stumbling
earlier in the year.
But the fuzzy economic picture was good news for bond investors. Despite three
hikes in short-term interest rates, the first increases in four years, bond
prices rose and yields fell over the period. Longer-term Treasury securities
were the strongest performers, with corporate bonds, including high-yield
issues, also delivering favorable returns. Lower long-term rates were also
beneficial to the housing and mortgage industries. Behind the rally in bonds
lies investor skepticism about the strength and durability of the current
economic recovery. A slowing recovery leading to an easing of inflationary
pressures may convince the Federal Reserve Board to slow the pace of future
rate increases. Less inflation would also mean better real returns for bond
holders.
Pioneer believes that the economy will continue to expand in 2005, but at a
more measured tempo. After an extended period of cutting costs and bolstering
balance sheets, many corporations are financially stronger than they have been
in some time. And although short-term interest rates have risen, they are still
relatively low and do not appear to be a barrier for companies needing to
borrow for expansion. Equity valuations now appear better aligned with earnings
prospects than was the case a year ago, when prices ran ahead of profit
expectations. Therefore, steady but moderate expansion in corporate profits has
the potential to drive stock prices higher.
As always, thank you for your investment in Pioneer Municipal High Income
Trust.
Respectfully,
/s/ Osbert M. Hood
Osbert M. Hood
President
Pioneer Investment Management, Inc.
Any information in this shareholder report regarding market or economic trends
or the factors influencing the Trust's historical or future performance are
statements of the opinion of Trust management as of the date of this report.
These statements should not be relied upon for any other purposes. Past
performance is no guarantee of future results, and there is no guarantee that
market forecasts discussed will be realized.
1
Pioneer Tax Advantaged Balanced Trust
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PORTFOLIO SUMMARY 11/30/04
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Portfolio Maturity
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(As a percentage of total debt holdings)
[The following table was depicted as a pie chart in the printed material.]
0-1 Year 1.2%
1-3 Years 0.3%
3-6 Years 13.9%
6-8 Years 46.7%
8-10 Years 6.1%
10+ Years 31.8%
Portfolio Diversification
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(As a percentage of total investment portfolio)
[The following table was depicted as a pie chart in the printed material.]
Tax-Exempt Obligations 52.9%
Common Stocks 27.2%
Non Convertible Preferred Stocks 15.7%
Convertible Preferred Stocks 4.2%
10 Largest Holdings
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(As a percentage of total long-term holdings)*
1. Jefferson Water & Sewer System Revenue, 5.0%, 10/1/41 1.86%
2. Miami-Dade County Aviation Revenue, 5.0%, 10/1/37 1.71
3. Exelon Corp. 1.63
4. Cinergy Corp. 1.55
5. Fannie Mae, Series L, 5.125% 1.51
6. Consolidated Edison, Inc. 1.49
7. Gila County Industrial Development Authority, 5.55%, 1/1/27 1.44
8. Bank of America Corp. 1.44
9. Puerto Rico Commonwealth Highway & Transportation Authority
Revenue, 5.125%, 7/1/43 1.37
10. King County Washington Sewer Revenue, 5.0%, 1/1/35 1.37
* This list excludes money market and derivative instruments. Portfolio
holdings will vary for other periods.
2
Pioneer Tax Advantaged Balanced Trust
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PERFORMANCE UPDATE 11/30/04
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Share Prices and Distributions
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Net Asset Value
per Common Share 11/30/04 1/28/04
$14.55 $14.33
Market Value
per Common Share 11/30/04 1/28/04
$12.74 $15.00
Distributions per
Common Share Income Short-Term Long-Term
(1/28/04 - 11/30/04) Dividends Capital Gains Capital Gains
$0.5496 $ - $ -
Investment Returns
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The mountain chart on the right shows the change in value of a $10,000
investment made in common shares of Pioneer Tax Advantaged Balanced Trust at
public offering price, compared to that of the Lehman Brothers Municipal Bond
Index and the S&P 500 Index.
----------------------------------------------
Cumulative Total Returns
(As of November 30, 2004)
Net Asset Market
Period Value Price
Life-of-Fund
(1/28/04) 6.09% -11.26%
----------------------------------------------
Value of $10,000 Investment
[The following table was depicted as a line chart in the printed material.]
Pioneer Tax Advantaged Lehman Brothers
Balanced Trust Municipal Bond Index Standard & Poor's 500
-------------- -------------------- ---------------------
1/04 10,000 10,000 10,000
11/04 8,874 10,585 10,529
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end
performance results. Current performance may be lower or higher than the
performance data quoted.
Performance data shown represents past performance. Past performance is no
guarantee of future results. Investment return and market price will fluctuate,
and your shares may trade below net asset value ("NAV"), due to such factors as
interest rate changes, and the perceived credit quality of borrowers.
Total investment return does not reflect broker sales charges or commissions.
All performance is for common shares of the Trust.
Closed-end funds, unlike open-end funds, are not continuously offered. Once
issued, shares of closed-end funds are sold in the open market through a stock
exchange and frequently trade at prices lower than their NAV. NAV is total
assets less total liabilities, which includes preferred shares, divided by the
number of common shares outstanding.
When NAV is lower than market price, dividends are assumed to be reinvested at
the greater of NAV or 95% of the market price. When NAV is higher, dividends
are assumed to be reinvested at market price.
The performance table and graph do not reflect the deduction of fees and taxes
that a shareowner would pay on Trust distributions or the redemption of Trust
shares.
Index comparison begins January 31, 2004. The Lehman Brothers Municipal Bond
Index is a widely recognized, unmanaged measure of approximately 15,000
municipal bonds. Bonds in the Index have a minimum credit rating of BBB, were
part of at least a $50 million issuance made within the past five years and have
a maturity of at least two years. S&P 500 Index is an unmanaged measure of 500
widely held common stocks listed on the New York Stock Exchange and the
over-the-counter market. Index returns are calculated monthly, assume
reinvestment of dividends and, unlike Trust returns, do not reflect any fees,
expenses or sales charges. You cannot invest directly in the Index.
3
Pioneer Tax Advantaged Balanced Trust
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PORTFOLIO MANAGEMENT DISCUSSION 11/30/04
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The first annual report for Pioneer Tax Advantaged Balanced Trust covers the
period since the Trust's inception on January 28, 2004 through November 30,
2004. In the report, David Eurkus, portfolio manager for the Trust's
fixed-income portion, and Walter Hunnewell, Jr., portfolio manager for the
Trust's equity portion, discuss the investment process, strategy and outlook.
Q: How did the Trust perform during the period?
A: Since inception, Pioneer Tax Advantaged Balanced Trust returned 6.09% at net
asset value and 11.26% at market price. As of November 30, 2004, the Trust
was selling at a discount of market price to net asset value of 12.4%. The
Trust's net asset value return reflects the expenses associated with the
start-up costs of the Trust. From February 1, 2004, through November 30,
2004, the Lehman Brothers Municipal Bond Index returned 2.63%, while the S&P
500 Index returned 5.29%. The Trust's relatively strong performance occurred
mostly during the second half of the reporting period when market interest
rates declined and bond prices rose, and the stock market rebounded from its
lows of 2004.
The performance data quoted represents past performance, which is no
guarantee of future results. Investment return and principal value will
fluctuate, and shares, when redeemed, may be worth more or less than their
original cost.
Q: What was the environment like during the period?
A: Early in the period, the strength of the economic rebound raised concerns
that inflation and interest rates might move higher. In that environment,
there was a significant sell-off in the bond market, which pushed bond prices
down and yields up. Equity markets also declined, as investors worried that
higher interest rates would erode corporate profits and, ultimately, have a
negative impact on stock prices.
As the fiscal year progressed, however, reports associated with the economy
indicated that the rapid pace of growth had shifted to a slower but steady
rate. Despite this slight softening in the economic expansion, the Federal
Reserve tightened monetary policy, boosting the federal funds rate on four
occasions, each time by 0.25%. (The federal funds rate is the rate banks
charge each other for overnight loans.) The Fed's policy had relatively
little effect on market interest rates, which trended down. The favorable
4
Pioneer Tax Advantaged Balanced Trust
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interest-rate environment was positive for both the bond and stock markets.
In the fixed-income area, bond prices rose; and in the equity market, stock
prices went up.
Q: What were the principal strategies used in managing the Trust?
A: Municipal securities accounted for 52% of the Trust's assets at period-end.
In the fixed-income portion of the Trust, we primarily emphasized
high-quality, investment-grade bonds; however, we also took advantage of our
ability to invest up to 15% of fixed-income assets in below investment-grade
securities, which helped boost the Trust's income stream. At the end of the
period, the credit quality breakdown of fixed-income assets was: AAA (23.8%);
AA (17.3%); A (23.1%); BBB (21.9%); and BB and lower (13.9%).
Fixed-income assets were mainly concentrated in insured bonds (22.6%) and
revenue bonds (77.4%). With revenue bonds, interest and principal are derived
from the particular asset the bond was issued to finance. For example, a bond
issued to finance a utility would be paid from the fees the utility charges
its customers. Only 1.2% of fixed-income assets were in general obligation
bonds, which are backed by the taxing power of the municipality that issues
them. In terms of industry exposure, fixed-income assets were invested in
health care (28.9%), housing (1.0%), pollution control (1.4%), transportation
(6.0%), water and sewer (5.1%), among others.
During the period, short-term interest rates declined, but long-term rates
remained relatively high. The historically low short-term rates enabled the
Trust to borrow funds inexpensively to invest in additional long-term
municipal bonds. This leveraging strategy helped augment the Trust's income.
At the end of the fiscal period on November 30, 2004, about 32% of the
fixed-income portion of the Trust was leveraged, giving a boost to
performance. About 60% of the Trust's leverage has been hedged for five
years.
At period-end approximately 47% of the Trust's assets were invested in
equities, with 27% in common stocks and 20% in preferred stocks. We sought
companies with long-term records of dividend payouts in the highest yielding
areas of the market, such as financials (40.6% of equity net assets) and
utilities (28.5% of equity net assets). We also invested in
telecommunications (6.4% of equity net assets), consumer staples (5.8% of
equity net assets), materials (5.7% of equity net assets), health care (4.6%
of equity
5
Pioneer Tax Advantaged Balanced Trust
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PORTFOLIO MANAGEMENT DISCUSSION 11/30/04 (continued)
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net assets) and energy (3.8% of equity net assets). The energy and utilities
sectors were the strongest performing areas of the market, and the Trust's
investments in Duke Energy and Southern were significant contributors to
performance. The Trust's return was also enhanced by Bank of America, one of
our largest common equity holdings, as well as positions in Lyondell Chemical
and Eastman Chemical, which paid attractive dividends and were well
positioned to take advantage of the improving economy. The Trust's tobacco
holdings posted impressive returns; however, to manage risk only 2.3% of net
assets were invested in tobacco over the period.
Q: What detracted from performance?
A: In the first few months of the period, performance was held back when bond
prices declined and yields rose because investors were concerned about the
prospects for higher inflation and rising interest rates. Later on, however,
when it became clear that the economic expansion would proceed at a moderate
pace and interest rates would remain relatively low, bond prices rose,
benefiting the Trust's return.
On the equity side, our investments in the pharmaceutical industry (2.1% of
net assets) detracted from results. We had a position in Merck that lost
value when it removed from the market its COX-II pain relief drug Vioxx. We
took advantage of the downturn in Merck's stock price to add to our position
in the company. In our opinion, Merck remains a solid pharmaceutical company
with the potential to maintain its record of consistent dividend payouts.
Q: What is your outlook over the next several months?
A: As we look ahead to 2005, we expect the current economic backdrop of moderate
growth and relatively low interest rates to continue. We believe this type of
environment should be positive for the high quality municipal bonds in the
portfolio. It should also be supportive of our equity investments, which
emphasize well established companies that continue to benefit from improving
business prospects.
Any information in this shareholder report regarding market or economic
trends or the factors influencing the Trust's historical or future
performance are statements of the opinion of Trust management as of the date
of this report. These statements should not be relied upon for any other
purposes. Past performance is no guarantee of future results, and there is no
guarantee that market forecasts discussed will be realized.
6
Pioneer Tax Advantaged Balanced Trust
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SCHEDULE OF INVESTMENTS 11/30/04
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S&P/Moody's
Principal Ratings
Amount (unaudited) Value
TAX EXEMPT OBLIGATIONS - 74.5% of Net Assets
Alabama - 2.9%
$6,990,000 AAA/Aaa Birmingham Waterworks & Sewer Revenue,
5.0%, 1/1/43 $ 6,977,837
5,000,000 NR/A2 Huntsville Health Care Authority Revenue,
5.75%, 6/1/32 5,217,050
-------------
$ 12,194,887
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Arizona - 2.8%
10,285,000 B-/Ca Gila County Industrial Development Authority,
5.55%, 1/1/27 $ 8,465,584
1,000,000 NR/Baa3 Pima County Industrial Development Authority,
6.375%, 7/1/31 1,012,770
1,000,000 NR/Baa3 Pima County Industrial Development Authority,
6.75%, 7/1/31 1,030,390
1,000,000 NR/NR Pima County Industrial Development Authority,
7.5%, 7/1/34 1,013,800
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$ 11,522,544
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California - 1.2%
1,000,000 BBB+/Baa1 California Health Facilities Authority Revenue,
5.25%, 7/1/23 $ 1,007,070
4,000,000 BBB/Baa3 Golden State Tobacco Securitization Corp.,
6.75%, 6/1/39 3,994,680
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$ 5,001,750
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Connecticut - 1.7%
4,190,000 BBB/A3 Connecticut State Development Authority
Pollution Control Revenue, 5.85%, 9/1/28 $ 4,466,037
1,000,000 AAA/Aaa Connecticut State Health & Educational
Facilities Authority Revenue, 5.0%, 7/1/21 1,048,870
1,500,000 BBB-/NR Mohegan Tribe Indians Gaming Authority,
5.25%, 1/1/33 (144A) 1,455,150
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$ 6,970,057
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District of Columbia - 1.0%
4,000,000 BBB/Baa3 District of Columbia Tobacco Settlement
Financing Corp., 6.75%, 5/15/40 $ 3,967,880
-------------
Florida - 6.9%
5,000,000 A/A2 Highlands County Health Facilities Authority
Revenue, 6.0%, 11/15/25 $ 5,389,800
10,980,000 AA-/Aa3 Jefferson Water & Sewer System Revenue,
5.0%, 10/1/41 10,931,578
The accompanying notes are an integral part of these financial statements.
7
Pioneer Tax Advantaged Balanced Trust
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SCHEDULE OF INVESTMENTS 11/30/04 (continued)
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S&P/Moody's
Principal Ratings
Amount (unaudited) Value
Florida (continued)
$2,025,000 BB/NR Miami Beach Health Facilities Authority,
5.375%, 11/15/28 $ 1,814,866
500,000 BB/Ba2 Miami Beach Health Facilities Authority,
6.7%, 11/15/19 522,260
10,000,000 AAA/Aaa Miami-Dade County Aviation Revenue,
5.0%, 10/1/37 10,043,300
-------------
$ 28,701,804
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Georgia - 1.4%
1,000,000 AAA/Aaa Georgia State General Obligation,
2.0%, 12/1/23 $ 676,920
2,500,000 BBB/NR Milledgeville-Baldwin County Development
Authority Revenue, 5.5%, 9/1/24 2,580,675
2,500,000 BBB/NR Milledgeville-Baldwin County Development
Authority Revenue, 5.625%, 9/1/30 2,552,600
-------------
$ 5,810,195
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Illinois - 5.1%
3,000,000 AAA/Aaa Chicago Illinois General Obligation, 5.0%,
1/1/28 $ 3,041,430
4,580,000 A-/Baa1 Illinois Development Finance Authority Revenue,
5.25%, 10/1/24 4,718,041
5,000,000 AA+/Aa1 Illinois Educational Facilities Authority Revenue,
5.0%, 12/1/38 5,014,350
2,000,000 AA+/Aa2 Illinois Finance Authority Revenue,
5.5%, 8/15/43 2,047,880
5,095,000 NR/A1 Illinois Health Facilities Authority Revenue,
5.75%, 7/1/15 5,463,216
1,130,000 CC/Caa1 Illinois Health Facilities Authority Revenue,
6.375%, 1/1/15 849,715
-------------
$ 21,134,632
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Indiana - 2.2%
4,135,000 CCC+/Caa2 Indiana State Development Finance Authority
Revenue, 5.75%, 10/1/11 $ 4,172,504
5,100,000 AAA/Aaa Indiana Transportation Finance Authority
Highway Revenue, 5.0%, 6/1/28 5,170,890
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$ 9,343,394
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Kansas - 1.4%
5,000,000 AAA/Aaa Wyandotte County Unified Government Utility
System Revenue, 5.65%, 9/1/19 $ 5,783,150
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The accompanying notes are an integral part of these financial statements.
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Pioneer Tax Advantaged Balanced Trust
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S&P/Moody's
Principal Ratings
Amount (unaudited) Value
Louisiana - 0.9%
$ 4,335,000 BBB/Baa3 Tobacco Settlement Financing Corp.,
5.875%, 5/15/39 $ 3,909,476
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Maryland - 0.7%
3,000,000 A/A3 Maryland State Health & Higher Educational
Facilities Authority Revenue,
5.125%, 7/1/34 $ 3,001,890
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Massachusetts - 4.0%
1,020,000 AAA/Aaa Littleton Massachusetts General Obligation,
5.0%, 1/15/20 $ 1,085,810
2,000,000 AA+/Aa1 Massachusetts Health & Educational Facilities
Authority Revenue, 5.0%, 7/1/33 2,020,780
1,550,000 BBB-/Baa2 Massachusetts Health & Educational Facilities
Authority Revenue, 5.25%, 7/15/18 1,510,181
1,600,000 BBB+/NR Massachusetts Health & Educational Facilities
Authority Revenue, 5.45%, 11/15/23 1,629,168
2,120,000 BBB/Baa3 Massachusetts Health & Educational Facilities
Authority Revenue, 5.625%, 7/1/20 2,150,931
900,000 BBB/Baa3 Massachusetts Health & Educational Facilities
Authority Revenue, 6.25%, 7/1/22 949,428
2,750,000 BBB/Baa2 Massachusetts Health & Educational Facilities
Authority Revenue, 6.625%, 7/1/32 2,910,298
1,100,000 BBB/Baa2 Massachusetts State Development Finance
Agency, 5.625%, 10/1/24 1,139,413
1,000,000 BBB/Baa2 Massachusetts State Development Finance
Agency, 5.7%, 10/1/34 1,025,960
2,000,000 AAA/Aaa University of Massachusetts Building Authority
Project Revenue, 5.25%, 11/1/29 2,092,800
-------------
$ 16,514,769
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Michigan - 1.9%
5,000,000 BBB-/NR Macomb County Hospital Finance Authority
Revenue, 5.875%, 11/15/34 $ 4,740,850
2,000,000 A/A2 Michigan State Hospital Finance Authority
Revenue, 5.5%, 11/1/15 2,161,240
1,025,000 BB/Ba1 Pontiac Hospital Finance Authority Revenue,
6.0%, 8/1/07 1,013,746
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$ 7,915,836
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The accompanying notes are an integral part of these financial statements.
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Pioneer Tax Advantaged Balanced Trust
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SCHEDULE OF INVESTMENTS 11/30/04 (continued)
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S&P/Moody's
Principal Ratings
Amount (unaudited) Value
Minnesota - 0.8%
$ 2,000,000 A-/NR Duluth Economic Development Authority Health
Care Facilities Revenue, 5.25%, 2/15/28 $ 2,006,940
1,500,000 A-/NR Duluth Economic Development Authority Health
Care Facilities Revenue, 5.25%, 2/15/33 1,499,880
-------------
$ 3,506,820
-------------
Missouri - 0.4%
1,720,000 AA/NR Missouri State Health & Educational Authority
Health Facilities Revenue, 5.25%, 8/15/28 $ 1,747,984
-------------
Montana - 0.3%
1,350,000 NR/A3 Montana Finance Authority Hospital Facilities
Revenue, 5.0%, 6/1/24 $ 1,331,141
-------------
Nevada - 2.3%
3,000,000 B-/NR Clark County Industrial Development Revenue,
5.5%, 10/1/30 $ 2,881,920
1,500,000 BBB+/Baa1 Henderson Nevada Health Care Facilities
Revenue, 5.625%, 7/1/24 1,544,715
5,000,000 BB/Ba2 Washoe County Water Facility Revenue,
5.0%, 3/1/36 5,079,150
-------------
$ 9,505,785
-------------
New Hampshire - 0.7%
2,000,000 NR/NR New Hampshire Business Finance Authority
Revenue, 6.05%, 9/1/29 $ 1,854,820
1,000,000 A+/A2 New Hampshire Health & Education Facilities
Authority Revenue, 5.75%, 10/1/31 1,042,370
-------------
$ 2,897,190
-------------
New Jersey - 3.4%
1,250,000 BBB/Baa3 Camden County Improvement Authority Revenue,
5.75%, 2/15/34 $ 1,286,413
1,500,000 BB/Ba2 New Jersey Health Care Facilities Financing
Authority Revenue, 5.125%, 7/1/14 1,356,945
5,000,000 BBB/Baa1 New Jersey Health Care Facilities Financing
Authority Revenue, 5.375%, 7/1/33 5,082,250
3,500,000 NR/NR New Jersey Health Care Facilities Financing
Authority Revenue, 7.25%, 7/1/27 3,667,300
3,000,000 BBB/Baa3 Tobacco Settlement Financing Corp.,
6.25%, 6/1/43 2,796,960
-------------
$ 14,189,868
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The accompanying notes are an integral part of these financial statements.
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Pioneer Tax Advantaged Balanced Trust
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S&P/Moody's
Principal Ratings
Amount (unaudited) Value
New Mexico - 0.6%
$ 1,000,000 AA/NR Dona Ana County PILT Revenue,
5.25%, 12/1/25 $ 1,041,060
1,500,000 NR/A3 Farmington New Mexico Hospital Revenue,
5.0%, 6/1/23 1,476,165
-------------
$ 2,517,225
-------------
New York - 5.0%
2,000,000 NR/NR Dutchess County Industrial Development Agency
Revenue, 7.5%, 3/1/29 $ 1,968,740
1,000,000 NR/Aa2 New York City Industrial Development Agency,
5.0%, 7/1/27 1,013,650
1,000,000 NR/Aa2 New York City Industrial Development Agency,
5.25%, 7/1/24 1,062,640
8,820,000(a) AA+/Aa2 New York City Transitional Finance Authority
Revenue, 0.0%, 11/1/29 6,769,791
5,000,000 AA-/A1 Port Authority of New York & New Jersey
Revenue, 5.0%, 9/1/38 5,024,400
4,900,000 AAA/Aaa Triborough Bridge & Tunnel Authority,
5.25%, 11/15/30 5,102,370
-------------
$ 20,941,591
-------------
North Carolina - 1.4%
3,000,000 AA+/Aa1 North Carolina Capital Facilities Finance Agency
Revenue, 5.125%, 7/1/42 $ 3,024,840
1,000,000 AA/NR North Carolina Capital Facilities Finance Agency
Student Revenue, 5.0%, 6/1/27 1,002,470
1,000,000 AA/NR North Carolina Capital Facilities Finance Agency
Student Revenue, 5.0%, 6/1/32 986,750
1,000,000 NR/NR North Carolina Medical Care Commission Health
Care Facilities Revenue, 5.0%, 11/1/23 990,550
-------------
$ 6,004,610
-------------
Ohio - 1.3%
2,000,000 B-/Caa2 Cleveland Airport Special Revenue,
5.7%, 12/1/19 $ 1,508,680
3,000,000 AAA/Aaa Columbus City School District, 5.0%, 12/1/32 3,042,690
1,000,000 AAA/Aaa Hamilton County Hospital Facilities Revenue,
5.125%, 5/15/28 1,026,600
-------------
$ 5,577,970
-------------
The accompanying notes are an integral part of these financial statements.
11
Pioneer Tax Advantaged Balanced Trust
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SCHEDULE OF INVESTMENTS 11/30/04 (continued)
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S&P/Moody's
Principal Ratings
Amount (unaudited) Value
Oregon - 0.7%
$ 2,935,000 NR/Aa2 Oregon State Housing & Community Services
Department Multi-Family Revenue,
6.0%, 7/1/31 $ 3,011,515
-------------
Pennsylvania - 2.5%
5,000,000 AAA/Aaa Pennsylvania State Turnpike Commission Oil
Franchise Tax Revenue, 5.0%, 12/1/31 $ 5,076,050
3,000,000 A-/NR Sayre Health Care Facilities Authority Revenue,
5.875%, 12/1/31 3,141,180
2,165,000 AA+/Aa1 Swarthmore Borough Authority College Revenue,
5.0%, 9/15/31 2,179,700
-------------
$ 10,396,930
-------------
Puerto Rico - 4.0%
8,000,000 A/Baa1 Puerto Rico Commonwealth Highway &
Transportation Authority Revenue,
5.125%, 7/1/43 $ 8,062,960
5,000,000 A-/Baa1 Puerto Rico Public Buildings Authority Revenue,
5.25%, 7/1/33 5,140,100
3,000,000 BBB+/Baa2 Puerto Rico Public Finance Corp.,
5.75%, 8/1/27 3,333,330
-------------
$ 16,536,390
-------------
Rhode Island - 1.0%
1,545,000 BBB/Baa3 Tobacco Settlement Financing Corp.,
6.125%, 6/1/32 $ 1,442,288
3,100,000 BBB/Baa3 Tobacco Settlement Financing Corp.,
6.25%, 6/1/42 2,865,764
-------------
$ 4,308,052
-------------
South Carolina - 4.1%
6,000,000 A-/A3 Berkeley County School District Installment
Lease, 5.0%, 12/1/28 $ 5,937,960
5,000,000 AAA/Aaa Florence County Hospital Revenue,
5.25%, 11/1/34 5,172,550
3,500,000 A/A2 Lexington County Health Services District, Inc.,
Hospital Revenue, 5.5%, 11/1/32 3,617,425
2,500,000 A-/A3 South Carolina Jobs Economic Development
Authority Revenue, 5.5%, 11/15/23 2,555,000
-------------
$ 17,282,935
-------------
The accompanying notes are an integral part of these financial statements.
12
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
S&P/Moody's
Principal Ratings
Amount (unaudited) Value
Tennessee - 0.6%
$ 2,500,000 NR/Baa3 Knox County Health Educational & Housing
Facilities Board Hospital Revenue,
6.5%, 4/15/31 $ 2,520,600
-------------
Texas - 2.0%
2,750,000 AAA/Aaa Lower Colorado River Authority, 5.0%, 5/15/31 $ 2,763,530
3,000,000 BBB/Baa2 Richardson Hospital Authority, 6.0%, 12/1/34 3,088,230
1,000,000 BBB-/NR Seguin Higher Education Facilities Corporation
Revenue, 5.0%, 9/1/23 974,980
1,500,000 NR/Baa3 Texas State Student Housing Revenue,
6.5%, 9/1/34 1,574,805
-------------
$ 8,401,545
-------------
Vermont - 0.3%
1,295,000 AA/Aa3 Vermont Educational & Health Buildings
Financing Agency Revenue, 5.0%, 7/1/24 $ 1,322,648
-------------
Virginia - 2.7%
1,500,000 NR/A3 Prince William County Industrial Development
Hospital Revenue, 5.2%, 10/1/26 $ 1,539,030
3,925,000 NR/A3 Prince William County Industrial Development
Hospital Revenue, 5.35%, 10/1/36 4,049,854
5,000,000 AA+/Aa1 Virginia Commonwealth Transportation Board
Revenue, 5.00%, 5/15/12 5,504,000
-------------
$ 11,092,884
-------------
Washington - 5.4%
8,000,000 AAA/Aaa King County Washington Sewer Revenue,
5.0%, 1/1/35 $ 8,031,280
3,000,000 AAA/Aaa Spokane County General Obligation,
5.0%, 12/1/33 3,014,430
7,000,000 BBB/Baa3 Tobacco Settlement Authority Revenue,
6.625%, 6/1/32 6,869,800
9,805,000 AAA/Aaa Washington State General Obligation,
0.0%, 12/1/19 4,720,617
-------------
$ 22,636,127
-------------
Wisconsin - 0.9%
3,500,000 BBB+/NR Wisconsin State Health & Educational Facilities
Authority Revenue, 5.6%, 2/15/29 $ 3,527,300
-------------
TOTAL TAX-EXEMPT OBLIGATIONS
(Cost $303,646,613) (b) $ 311,029,374
-------------
The accompanying notes are an integral part of these financial statements.
13
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 11/30/04 (continued)
--------------------------------------------------------------------------------
Shares Value
COMMON STOCKS - 38.3% of Net Assets
Energy - 1.3%
Oil & Gas - 1.3%
50,000 ChevronTexaco Corp. $ 2,730,000
45,000 Kerr-McGee Corp. 2,800,350
-------------
Total Energy $ 5,530,350
-------------
Materials - 3.8%
Chemicals - 3.4%
83,000 Eastman Chemical Co. $ 4,513,540
192,045 Lyondell Chemical Co. 5,388,783
61,128 PPG Industries, Inc. 4,124,306
-------------
$ 14,026,629
-------------
Construction Materials - 0.0%
3,950 Monarch Cement Co. $ 86,505
-------------
Metals & Mining - 0.4%
39,800 Freeport-McMoRan Copper & Gold, Inc. $ 1,557,374
200 Worthington Industries, Inc. 4,302
-------------
$ 1,561,676
-------------
Total Materials $ 15,674,810
-------------
Industrials - 0.6%
Commercial Services & Supplies - 0.6%
39,600 R.R. Donnelley & Sons Co. $ 1,374,120
100,000 ServiceMaster Co. 1,317,000
-------------
Total Industrials $ 2,691,120
-------------
Capital Goods - 2.0%
Automobiles - 0.7%
80,000 General Motors Corp. $ 3,087,200
-------------
Household Durables - 1.3%
50,000 Bassett Furniture Industries, Inc. $ 985,500
48,386 Kimball International, Inc. 720,951
33,700 Knape & Vogt Manufacturing Co. 418,554
166,444 Tupperware Corp. 3,115,832
-------------
$ 5,240,837
-------------
Total Capital Goods $ 8,328,037
-------------
The accompanying notes are an integral part of these financial statements.
14
Pioneer Tax Advantaged Balanced Trust
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--------------------------------------------------------------------------------
Shares Value
Food, Beverage & Tobacco - 3.9%
Food & Staples Retailing - 0.3%
70,000 Lance, Inc. $ 1,304,800
-------------
Food Retail - 0.5%
78,100 ConAgra Foods, Inc. $ 2,112,605
-------------
Tobacco - 3.1%
76,000 Altria Group, Inc. $ 4,369,240
115,000 Loews Corp. - Carolina Group 3,381,000
33,000 Reynolds American, Inc. 2,495,790
56,000 UST, Inc. 2,465,680
-------------
$ 12,711,710
-------------
Total Food, Beverage & Tobacco $ 16,129,115
-------------
Health Care - 3.0%
Pharmaceuticals - 3.0%
281,215 Bristol-Myers Squibb Co. $ 6,608,553
216,536 Merck & Co., Inc. 6,067,339
-------------
Total Health Care $ 12,675,892
-------------
Financials - 6.4%
Commercial Banks - 5.9%
182,800 Bank of America Corp. $ 8,458,156
78,200 FirstMerit Corp. 2,140,334
163,100 KeyCorp 5,429,599
90,000 National City Corp. 3,337,200
67,800 Regions Financial Corp. 2,372,322
222,700 TrustCo Bank Corp., NY 3,140,070
-------------
$ 24,877,681
-------------
Thrifts & Mortgage Finance - 0.5%
50,000 Washington Mutual, Inc. $ 2,035,500
-------------
Total Financials $ 26,913,181
-------------
Telecommunication Services - 2.7%
Diversified Telecommunication Services - 2.7%
257,900 AT&T Corp. $ 4,719,570
260,000 SBC Communications, Inc. 6,544,200
-------------
Total Diversified Telecommunication Services $ 11,263,770
-------------
Wireless Telecommunication Services - 0.0%
923(c) Nextel Communications, Inc. $ 26,269
-------------
Total Wireless Telecommunication Services $ 26,269
-------------
Total Telecommunication Services $ 11,290,039
-------------
The accompanying notes are an integral part of these financial statements.
15
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 11/30/04 (continued)
--------------------------------------------------------------------------------
Shares Value
Utilities - 14.6%
Electric Utilities - 11.7%
137,135 Ameren Corp. $ 6,640,077
220,000 Cinergy Corp. 9,105,800
200,000 Consolidated Edison, Inc. 8,770,000
138,400 Empire District Electric Co. 3,143,064
229,293 Exelon Corp. 9,563,811
74,383 Great Plains Energy, Inc. 2,202,481
67,056 NSTAR 3,396,386
179,000 Southern Co. 5,869,410
-------------
$ 48,691,029
-------------
Gas Utilities - 1.1%
112,249 KeySpan Corp. $ 4,436,080
-------------
Multi-Utilities - 1.8%
303,253 Duke Energy Corp. $ 7,666,236
-------------
Total Utilities $ 60,793,345
-------------
TOTAL COMMON STOCKS
(Cost $151,627,922) $ 160,025,889
-------------
NON-CONVERTIBLE PREFERRED STOCKS - 22.0% of Net Assets
Energy - 1.2%
Oil & Gas - 1.2%
49,300 Apache Corp., Series B, 5.68% $ 4,928,462
-------------
Total Energy $ 4,928,462
-------------
Financials - 17.8%
Capital Markets - 2.4%
57,000 Bear Stearns Companies, Inc., Series F, 5.72% $ 3,006,750
40,000 Bear Stearns Companies, Inc., Series G, 5.49% 1,996,000
100,000 Lehman Brothers Holdings, Inc., 6.5% 2,683,000
19,000 Lehman Brothers Holdings, Inc., Series C, 5.94% 950,000
30,000 Lehman Brothers Holdings, Inc., Series D, 5.67% 1,452,000
-------------
$ 10,087,750
-------------
Commercial Banks - 2.7%
94,000 Bank of America Corp., Series VI, 6.75% $ 5,029,000
200,000 Royal Bank of Scotland Group Plc, Series L, 5.75% 4,834,000
55,000 Wachovia Preferred Funding Corp., Series A, 7.25% 1,548,250
-------------
$ 11,411,250
-------------
The accompanying notes are an integral part of these financial statements.
16
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Shares Value
Consumer Finance - 0.7%
50,000 SLM Holding Corp., Series A, 6.97% $ 2,845,000
-------------
Diversified Financial Services - 1.7%
55,000 Citigroup Inc., Series G, 6.213% $ 2,942,500
81,500 Citigroup Inc., Series M, 5.864% 4,250,225
-------------
$ 7,192,725
-------------
Insurance - 1.8%
110,000 ACE Ltd., Series C, 7.8% $ 2,893,000
70,000 RenaissanceRe Holdings, Ltd., Series C, 6.08% 1,656,200
109,000 XL Capital, Ltd., Series B, 7.625% 2,988,780
-------------
$ 7,537,980
-------------
Real Estate - 2.3%
27,000 Equity Office Properties Trust, Series G, 7.75% $ 729,270
92,000 Home Properties New York, Inc., Series F, 9.0% 2,493,200
40,000 Prologis Trust, Series G, 6.75% 1,019,600
60,000 PS Business Parks, Inc., Series H, 7.0% 1,479,600
22,000 PS Business Parks, Inc., Series I, 6.875% 544,500
35,480 Public Storage, Inc., Series T, 7.625% 943,413
94,000 Regency Centers Corp., Series C, 7.45% 2,481,600
-------------
$ 9,691,183
-------------
Thrifts & Mortgage Finance - 6.2%
201,000 Fannie Mae, Series L, 5.125% $ 8,894,250
114,000 Fannie Mae, Series M, 4.75% 4,662,600
100,000 Fannie Mae, Series N, 5.5% 4,690,000
57,000 Freddie Mac, 5.81% 2,875,650
39,000 Freddie Mac, Series F, 5.0% 1,677,000
58,000 Freddie Mac, Series K, 5.79% 2,900,000
-------------
$ 25,699,500
-------------
Total Financials $ 74,465,388
-------------
Utilities - 3.0%
Electric Utilities - 2.6%
98,000 Alabama Power Co., 5.3% $ 2,431,625
113,000 Alabama Power Co., 5.83% 2,921,050
78,000 Interstate Power and Light Co., Series B, 8.375% 2,535,000
40,000 Mississippi Power Co., 5.25% 953,752
7,700 PPL Electric Utilities Corp., 4.5% 633,710
72,000 Southern California Edison Co., 4.32% 1,350,000
-------------
$ 10,825,137
-------------
The accompanying notes are an integral part of these financial statements.
17
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 11/30/04 (continued)
--------------------------------------------------------------------------------
Shares Value
Gas Utilities - 0.4%
62,000 Southern Union Co., Series C, 7.55% $ 1,695,700
-------------
Total Utilities $ 12,520,837
-------------
TOTAL NON-CONVERTIBLE PREFERRED STOCKS
(Cost $93,972,462) $ 91,914,687
-------------
CONVERTIBLE PREFERRED STOCKS - 5.9% of Net Assets
Financials - 2.6%
Capital Markets - 1.0%
65,000 Merrill Lynch Preferred Capital Trust IV, 7.12% $ 1,736,617
87,000 Merrill Lynch Preferred Capital Trust V, 7.28% 2,342,929
-------------
$ 4,079,546
-------------
Commercial Banks - 1.0%
30,000 Bank One Capital V, 8.0% $ 786,920
105,000 Bank One Capital VI, 7.2% 2,752,061
27,000 Fleet Capital Trust VII, 7.2% 708,468
-------------
$ 4,247,449
-------------
Consumer Finance - 0.1%
18,000 MBNA Capital, Series D, 8.125% $ 484,439
-------------
Insurance - 0.4%
70,000 St. Paul Capital Trust I, 7.6% $ 1,818,414
-------------
Thrifts & Mortgage Finance - 0.1%
12,000 Countrywide Capital IV, 6.75% $ 307,563
-------------
Total Financials $ 10,937,411
-------------
Industrials - 0.5%
Aerospace & Defense - 0.5%
15,000 Northrop Grumman Corp., 7.0% $ 2,023,500
-------------
Total Industrials $ 2,023,500
-------------
Telecommunication Services - 1.5%
Diversified Telecommunication Services - 1.5%
60,000 Alltel Corp., 7.75% $ 3,097,200
126,000 CenturyTel, Inc., 6.875% 3,215,520
-------------
Total Telecommunication Services $ 6,312,720
-------------
The accompanying notes are an integral part of these financial statements.
18
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Shares Value
Utilities - 1.3%
Electric Utilities - 1.3%
31,000 DTE Energy Co., 8.75% $ 814,680
80,000 Energy East Capital Trust I, 8.25% 2,114,804
94,000 Virginia Power Capital Trust II, 7.375% 2,517,758
-------------
Total Utilities $ 5,447,242
-------------
TOTAL CONVERTIBLE PREFERRED STOCKS
(Cost $24,019,281) $ 24,720,873
-------------
TAX-EXEMPT MONEY MARKET MUTUAL FUND - 0.0% of Net Assets
44,653 BlackRock Provident Institutional Municipal Fund $ 44,653
-------------
TOTAL TAX-EXEMPT MONEY MARKET MUTUAL FUND
(Cost $44,653) $ 44,653
-------------
TOTAL INVESTMENTS IN SECURITIES - 140.7%
(Cost $573,310,931) (d) $ 587,735,476
-------------
OTHER ASSETS AND LIABILITIES - 1.5% $ 6,327,222
-------------
PREFERRED SHARES AT REDEMPTION VALUE, INCLUDING
DIVIDENDS PAYABLE - (42.2)% $(176,273,429)
-------------
NET ASSETS APPLICABLE TO COMMON SHAREOWNERS -
100.0% $ 417,789,269
=============
NR Security not rated by S&P or Moody's.
(144A) Security is exempt from registration under Rule 144A of the Securities
Act of 1933. Such securities may be resold normally to qualified
institutional buyers in a transaction exempt from registration. At
November 30, 2004 the value of these securities amounted to $1,455,150 or
0.3% of net assets applicable to common shareholders.
(a) Indicates a security that has a zero coupon that remains in effect until
a predetermined date at which time the stated coupon rate becomes
effective until final maturity.
The accompanying notes are an integral part of these financial statements.
19
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 11/30/04 (continued)
--------------------------------------------------------------------------------
(b) The concentration of tax-exempt investments by type of obligation/market
sector is as follows:
Insured 22.6%
General Obligation 1.2
Revenue Bonds:
Health Revenue 28.9
Development Revenue 8.5
Tobacco Revenue 8.3
Education Revenue 7.8
Transportation Revenue 6.0
Other 3.7
Utilities Revenue 3.5
Facilities Revenue 2.0
School District Revenue 1.9
Water Revenue 1.6
Pollution Revenue 1.4
Housing Revenue 1.0
Student Loan Revenue 0.6
Gaming Revenue 0.5
Airport Revenue 0.5
-----
100.0%
=====
(c) Non-incoming producing.
(d) At November 30, 2004, the net unrealized gain on investments
based on cost for federal income tax purposes of $573,326,765
was as follows:
Aggregate gross unrealized gain for all investments in which there
is an excess of value over tax cost $22,753,931
Aggregate gross unrealized loss for all investments in which there
is an excess of tax cost over value (8,345,220)
-----------
Net unrealized gain $14,408,711
===========
For financial reporting purposes net unrealized gain on investments was
$14,424,545 and cost of investments aggregated $573,310,931.
Purchases and sales of securities (excluding temporary cash investments) for the
period ended November 30, 2004, aggregated $919,662,663 and $339,176,706,
respectively.
The accompanying notes are an integral part of these financial statements.
20
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES 11/30/04
--------------------------------------------------------------------------------
ASSETS:
Investments in securities, at value (cost $573,310,931) $587,735,476
Receivables -
Investment securities sold 2,034,208
Dividends and interest 6,080,826
Unrealized appreciation on interest rate swaps 963,116
Prepaid expenses 9,488
------------
Total assets $596,823,114
------------
LIABILITIES:
Payables -
Investment securities purchased $ 1,998,875
Net interest rate swaps payable 100,707
Offering costs payable - preferred 15,162
Due to affiliates 292,664
Due to custodian 217,065
Administration fee payable 30,991
Accrued expenses 104,952
------------
Total liabilities $ 2,760,416
------------
PREFERRED SHARES AT REDEMPTION VALUE:
$25,000 liquidation value per share applicable to 7,050
shares, including dividends payable of $23,429 $176,273,429
------------
NET ASSETS APPLICABLE TO COMMON SHAREOWNERS:
Paid-in capital $408,360,057
Undistributed net investment income 872,076
Accumulated net realized loss on investments and
interest rate swaps (6,830,525)
Net unrealized gain on investments 14,424,545
Net unrealized gain on interest rate swaps 963,116
------------
Net assets applicable to common shareowners $417,789,269
------------
NET ASSET VALUE PER SHARE:
No par value, (unlimited number of shares authorized)
Based on $417,789,269/28,706,981 common shares $ 14.55
============
The accompanying notes are an integral part of these financial statements.
21
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
--------------------------------------------------------------------------------
For the period 1/28/04 (commencement of operations) to 11/30/04
INVESTMENT INCOME:
Dividends $ 9,559,726
Interest 12,669,666
-----------
$22,229,392
-----------
EXPENSES:
Management fees $ 2,654,437
Administration fees 290,852
Transfer agent fees and expenses 44,434
Auction agent fees 293,914
Custodian fees 24,886
Registration fees 28,023
Organization costs 40,000
Professional fees 59,642
Printing expenses 20,306
Trustees' fees 13,259
Miscellaneous 18,764
-----------
Total expenses $ 3,488,517
Reimbursement of organization costs (40,000)
-----------
Net expenses $ 3,448,517
-----------
Net investment income $18,780,875
-----------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS AND INTEREST RATE SWAPS:
Net realized loss from:
Investments $(6,830,836)
Interest rate swaps (328,940) $(7,159,776)
----------- -----------
Net unrealized gain from:
Investments $14,424,545
Interest rate swaps 963,116 $15,387,661
----------- -----------
Net gain on investments and interest rate swaps $ 8,227,885
-----------
DISTRIBUTIONS TO PREFERRED SHAREOWNERS FROM
NET INVESTMENT INCOME $(1,802,192)
-----------
Net increase in net assets applicable to common
shareowners resulting from operations $25,206,568
===========
The accompanying notes are an integral part of these financial statements.
22
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
--------------------------------------------------------------------------------
For the period 1/28/04 (commencement of operations) to 11/30/04
1/28/04
to
11/30/04
FROM OPERATIONS:
Net investment income $ 18,780,875
Net realized loss on investments and interest rate swaps (7,159,776)
Net unrealized gain on investments and interest rate swaps 15,387,661
Distributions to preferred shareowners from net investment income (1,802,192)
------------
Net increase in net assets applicable to common shareowners
resulting from operations $ 25,206,568
------------
DISTRIBUTIONS TO COMMON SHAREOWNERS:
Net investment income ($0.55 per share) $(15,777,356)
------------
Total dividends to common shareowners $(15,777,356)
------------
FROM TRUST SHARE TRANSACTIONS:
Net proceeds from the issuance of common shares $366,720,000
Net proceeds from underwriters' over-allotment option exercised 44,407,500
Common share offering expenses charged to paid-in capital (851,752)
Preferred share offering expenses charged to paid-in capital (2,015,694)
------------
Net increase in net assets applicable to common shareowners
resulting from Trust share transactions $408,260,054
------------
Net increase in net assets applicable to common shareowners $417,689,266
NET ASSETS APPLICABLE TO COMMON SHAREOWNERS:
Beginning of period 100,003
------------
End of period (including undistributed net investment income
of $872,076) $417,789,269
============
The accompanying notes are an integral part of these financial statements.
23
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS 11/30/04
--------------------------------------------------------------------------------
January 28, 2004
November 30,
2004 (a)(b)
Per Common Share Operating Performance
Net asset value, beginning of period $ 14.33+
--------
Increase (decrease) from investment operations:
Net investment income $ 0.66
Net realized and unrealized gain on investments and interest rate swaps 0.27
Distributions to preferred shareowners from net investment income (0.06)
--------
Net increase from investment operations $ 0.87
Distributions to common shareowners:
Net investment income (0.55)
Capital charge with respect to issuance of:
Common shares (0.03)
Preferred shares (0.07)
--------
Net increase in net asset value $ 0.22
--------
Net asset value, end of period* $ 14.55
========
Market value, end of period* $ 12.74
--------
Total return++ (11.26)%
Ratios to average net assets of common shareowners
Net expenses+++ 1.04%**
Net investment income before preferred share dividends+++ 5.69%**
Preferred share dividends 0.55%**
Net investment income available to common shareowners 5.14%**
Portfolio turnover 63%
Net assets of common shareowners, end of period (in thousands) $417,789
Preferred shares outstanding (in thousands) $176,250
Asset coverage per preferred share, end of period $ 84,264
Average market value per preferred share $ 25,000
Liquidation value per preferred share $ 25,003
Ratios to average net assets of common shareowners before
reimbursement of organization expenses
Net expenses+++ 1.05%**
Net investment income before preferred share dividends+++ 5.68%**
Preferred share dividends 0.55%**
Net investment income available to common shareowners 5.13%**
(a) The per common share data presented above is based upon the average common
shares outstanding for the period presented.
(b) Trust shares were first publicly offered on January 28, 2004.
* Net asset value and market value are published in Barron's on Saturday, The
Wall Street Journal on Monday and The New York Times on Monday and Saturday.
** Annualized.
+ Net asset value immediately after the closing of the first public offering
was $14.30.
++ Total investment return is calculated assuming a purchase of common shares
at the current market value on the first day and a sale at the current
market value on the last day of the period reported. Dividends and
distributions, if any, are assumed for purposes of this calculation to be
reinvested at prices obtained under the Trust's dividend reinvestment plan.
Total investment return does not reflect brokerage commissions. Total
investment return for less than a full period is not annualized. Past
performance is not a guarantee of future results.
+++ Ratios do not reflect the effect of dividend payments to preferred
shareowners.
The information above represents the audited operating performance data for a
share of common stock outstanding, total investment return, ratios to average
net assets of common shareowners and other supplemental data for the period
indicated. This information has been determined based upon financial
information provided in the financial statements and market value data for the
Trust's common shares.
The accompanying notes are an integral part of these financial statements.
24
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 11/30/04
--------------------------------------------------------------------------------
1. Organization and Significant Accounting Policies
Pioneer Tax Advantaged Balanced Trust (the "Trust") was organized as a Delaware
business trust on October 16, 2003. Prior to commencing operations on January
28, 2004, the Trust had no operations other than matters relating to its
organization and registration as a diversified, closed-end management
investment company under the Investment Company Act of 1940, as amended, and
the sale and issuance to Pioneer Funds Distributor, Inc., an affiliate of
Pioneer Investment Management, Inc. ("PIM"), the Trust's investment adviser, a
wholly owned indirect subsidiary of UniCredito Italiano S.p.A. (UniCredito
Italiano), of 6,981 shares of beneficial interest at an aggregate purchase
price of $100,003. PIM has paid all the Trust's organizational expenses. The
investment objective of the Trust is to provide a high level of total after-tax
return, including attractive tax-advantaged income.
The Trust may invest in municipal securities with a broad range of maturities
and credit ratings, including both investment grade and below investment grade
municipal securities. The Trust may also invest in common stocks and preferred
securities that pay tax-qualified dividends. In addition, the Trust may invest
in other securities, including debt instruments, real estate investment trusts
("REITS") and equity securities, that generate income taxable at ordinary
income rates, rather than long-term capital gain rates.
The Trust invests in below investment grade (high yield) debt securities. Debt
securities rated below investment grade are commonly referred to as "'junk
bonds'" and are considered speculative. These securities involve greater risk
of loss, are subject to greater price volatility, and are less liquid,
especially during periods of economic uncertainty or change, than higher rated
debt securities.
The Trust's financial statements have been prepared in conformity with U.S.
accounting principles generally accepted in the United States of America that
require the management of the Trust to, among other things, make estimates and
assumptions that affect the reported amounts of assets and liabilities, the
disclosure of contingent assets and liabilities at the date of the financial
statements, and the reported amounts of income, expenses and gains and losses
on investments during the reporting period. Actual results could differ from
those estimates. The following is a summary of significant
25
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 11/30/04 (continued)
--------------------------------------------------------------------------------
accounting policies followed by the Trust in preparation of its financial
statements, which are consistent with those generally accepted in the
investment company industry:
A. Security Valuation
Security transactions are recorded as of trade date. Debt securities are
valued at prices supplied by independent pricing services, which consider
such factors as Treasury spreads, yields, maturities and ratings. Valuations
may be supplemented by dealers and other sources, as required. Equity
securities are valued at the last sale price on the principal exchange where
they are traded. The value of interest rate swaps are determined by obtaining
dealer quotations. Securities for which market quotations are not readily
available are valued at their fair values as determined by, or under the
direction of, the Board of Trustees. The Trust may also use the fair value of
a security, including a non U.S. security, when the closing market price on
the principal exchange where the security is traded no longer accurately
reflects the value of the security as of the close of the exchange. As of
November 30, 2004, the Trust had no fair valued securities.
Dividend income is recorded on the ex-dividend date, except that certain
dividends from foreign securities where the ex-dividend date may have passed
are recorded as soon as the Trust becomes aware of the ex-dividend data in
the exercise of reasonable diligence. Discount and premium on debt securities
are accreted or amortized daily, respectively, on an effective yield to
maturity basis and are included in interest income. Interest income,
including income on interest bearing cash accounts, is recorded on an accrual
basis. Temporary cash investments are valued at amortized cost.
Gains and losses on sales of investments are calculated on the identified
cost method for both financial reporting and federal income tax purposes.
B. Federal Income Taxes
It is the Trust's policy to comply with the requirements of the Internal
Revenue Code applicable to regulated investment companies and to distribute
all of its taxable income and net realized capital gains, if any, to its
shareowners. Therefore, no federal income tax provision is required.
26
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
The amounts and characterizations of distributions to shareowners for
financial reporting purposes are determined in accordance with federal income
tax rules. Therefore, the source of the Trust's distributions may be shown in
the accompanying financial statements as either from or in excess of net
investment income or net realized gain on investment transactions, or from
paid-in capital, depending on the type of book/tax differences that may
exist.
At November 30, 2004, the Trust reclassified $329,251 to decrease
undistributed net investment income and to decrease accumulated net realized
loss on investments. The reclassification has no impact on the net asset
value of the Trust and presents the Trust's capital accounts on a tax basis.
At November 30, 2004, the Trust had a capital loss carryforward of $6,830,525
which will expire in 2012 if not utilized.
The tax character of current year distributions paid to common and preferred
shareowners during the period ended November 30, 2004 was as follows:
-------------------------------------------
2004
-------------------------------------------
Distributions paid from:
Tax-Exempt income $ 9,413,848
Ordinary income 8,165,700
Long-term capital gain -
-----------
$17,579,548
===========
-------------------------------------------
The following shows the components of distributable earnings on a federal income
tax basis at November 30, 2004.
-----------------------------------------------------
2004
-----------------------------------------------------
Undistributed tax-exempt income $ 475,326
Undistributed ordinary income 412,584
Capital loss carryforward (6,830,525)
Unrealized appreciation 15,371,827
----------
Total $9,429,212
==========
-----------------------------------------------------
27
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 11/30/04 (continued)
--------------------------------------------------------------------------------
The difference between book basis and tax basis unrealized appreciation is
primarily attributable to the difference between book and tax amortization
methods for premiums and discounts on fixed income securities.
C. Automatic Dividend Reinvestment Plan
All common shareowners automatically participate in the Automatic Dividend
Reinvestment Plan (the "Plan"), under which participants receive all
dividends and capital gain distributions (collectively, "dividends") in full
and fractional common shares of the Trust in lieu of cash. Shareowners may
elect not to participate in the Plan. Shareowners not participating in the
Plan receive all dividends and capital gain distributions in cash.
Participation in the Plan is completely voluntary and may be terminated or
resumed at any time without penalty by notifying Mellon Investor Services
LLC, the agent for shareowners in administering the Plan (the "Plan Agent"),
in writing prior to any dividend record date; otherwise such termination or
resumption will be effective with respect to any subsequently declared
dividend or other distribution. Whenever the Trust declares a dividend on
common shares payable in cash, participants in the Plan will receive the
equivalent in common shares acquired by the Plan Agent either (i) through
receipt of additional unissued but authorized common shares from the Trust or
(ii) by purchase of outstanding common shares on the New York Stock Exchange
or elsewhere. If, on the payment date for any dividend, the net asset value
per common share is equal to or less than the market price per share plus
estimated brokerage trading fees ("market premium"), the Plan Agent will
invest the dividend amount in newly issued common shares. The number of newly
issued common shares to be credited to each account will be determined by
dividing the dollar amount of the dividend by the net asset value per common
share on the date the shares are issued, provided that the maximum discount
from the then current market price per share on the date of issuance does not
exceed 5%. If, on the payment date for any dividend, the net asset value per
common share is greater than the market value ("market discount"), the Plan
Agent will invest the dividend amount in common shares acquired in
open-market purchases. There are no brokerage charges with respect to newly
issued common shares. However, each participant will pay a pro rata share of
brokerage trading fees incurred with
28
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
respect to the Plan Agent's open-market purchases. Participating in the Plan
does not relieve shareowners from any federal, state or local taxes which may
be due on dividends paid in any taxable year. Shareowners holding Plan shares
in a brokerage account may not be able to transfer the shares to another
broker and continue to participate in the Plan.
2. Management Agreement
PIM manages the Trust's portfolio. Management fees are calculated daily at the
annual rate of 0.60% of the Trust's average daily managed assets. "Managed
assets" is the average daily value of the Trust's total assets minus the sum of
the Trust's liabilities, which liabilities exclude debt related to leverage,
short-term debt and the aggregate liquidation preference of any outstanding
preferred shares. At November 30, 2004, $292,664 was payable to PIM related to
management fees.
In addition, under PIM's management and administration agreements, certain
other services and costs are paid by the Trust. PIM has retained Princeton
Administrators, L.P., an affiliate of Merrill Lynch, Pierce, Fenner & Smith
Incorporated, to provide certain administrative services to the Trust on its
behalf. The Trust pays Princeton Administrators, L.P. a monthly fee at an
annual rate of 0.07% of the average daily value of the Trust's managed assets
up to $500 million and 0.03% for average daily managed assets in excess of $500
million, subject to a minimum monthly fee of $10,000.
Also, PIM has agreed for the first three years of the Trust's investment
operations to limit the Trust's total annual expenses [excluding offering costs
for common and preferred shares, interest expense, the cost of defending or
prosecuting any claim or litigation to which the Trust is a party (together
with any amount in judgment or settlement), indemnification expenses or taxes
incurred due to the failure of the Trust to qualify as a regulated investment
company under the Code or any other non-recurring or non-operating expenses] to
0.80% of the Trust's average daily managed assets. The dividend on any
preferred shares is not an expense. Under the agreement, PIM may subsequently
recover reimbursed expenses within three years of being incurred from the Trust
if the Trust's total expenses are less than 0.80% of average managed assets.
For the period ended, November 30, 2004, the Trust's expenses were not reduced
under such arrangements.
29
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 11/30/04 (continued)
--------------------------------------------------------------------------------
3. Transfer Agents
Pioneer Investment Management Shareholder Services, Inc. ("PIMSS"), a wholly
owned indirect subsidiary of UniCredito Italiano, through a sub-transfer agency
agreement with Mellon Investor Services LLC, provides substantially all
transfer agent and shareowner services related to the Trust's common shares at
negotiated rates. Deutsche Bank Trust Company Americas is the transfer agent,
registrar, dividend paying agent and redemption agent with respect to the
Trust's Auction Market Preferred Shares ("AMPS"). The Trust pays Deutsche Bank
Trust Company Americas an annual fee, as is agreed to from time to time by the
Trust and Deutsche Bank Trust Company Americas, for providing such services.
4. Interest Rate Swaps
The Trust may enter into interest rate swap transactions to attempt to protect
itself from increasing dividend or interest expense on its leverage resulting
from increasing short-term interest rates. The cost of leverage may rise with
an increase in interest rates, generally having the effect of lower yields and
potentially lower dividends to common shareowners. Interest rate swaps can be
used to "lock in" the cost of leverage and reduce the negative impact that
rising short-term interest rates would have on the Trust's leveraging costs.
An interest rate swap is an agreement between two parties, which involves
exchanging floating rate and fixed rate interest payments for a specified
period of time. Interest rate swaps involve the accrual and exchange of net
interest payments between the parties. For financial reporting purposes, the
Trust records the net receivable or payable for the net interest expected to be
received or paid as net realized gains or losses from interest rate swaps in
the Statement of Operations. During the term of the swap, changes in the value
of the swap are recognized as unrealized gains and losses by
"marking-to-market" to reflect the market value of the swap. When the swap is
terminated, the Trust will record a realized gain or loss equal to the
difference, if any, between the proceeds from (or cost of) the closing contract
and the cost basis of the contract. The Trust is exposed to credit risk in the
event of non-performance by the other party to the interest rate swap. However,
the Trust does not anticipate non-performance by any counterparty.
30
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Under the terms of the agreement entered into by the Trust, the Trust receives
a floating rate of interest and pays a fixed rate of interest for the term.
Details of the swap agreement outstanding as of November 30, 2004 were as
follows:
---------------------------------------------------------------------------------------
Termination Notional Fixed Unrealized
Counterparty Date Amount (000) Rate Floating Rate Appreciation
-------------- --------------- -------------- -------- --------------- -------------
UBS AG Sept. 1, 2009 $106,000 2.855% 1 month BMA $963,116
---------------------------------------------------------------------------------------
5. Trust Shares
There are an unlimited number of common shares of beneficial interest
authorized. Of the 28,706,981 common shares of beneficial interest outstanding
at November 30, 2004, PIM owned 6,981 shares.
Transactions in common shares of beneficial interest for the period January 28,
2004 (commencement of investment operations) to November 30, 2004 were as
follows:
-------------------------------------------------------------------
Shares issued in connection with initial public
offering 25,600,000
Shares issued from underwriters' over-allotment
option exercised 3,100,000
---------
Net increase in shares outstanding 28,700,000
Shares outstanding at beginning of period 6,981
----------
Shares outstanding at end of period 28,706,981
----------
-------------------------------------------------------------------
Offering costs of $851,752 incurred in connection with the Trust's offering of
common shares have been charged to paid-in capital.
The Trust may classify or reclassify any unissued common shares of beneficial
interest into one or more series of preferred shares of beneficial interest. On
April 12, 2004, the Trust reclassified and issued 7,050 shares of common shares
into three series of Auction Market Preferred Shares ("AMPS") as follows: Series
T7 - 2,350, Series F7 - 2,350 and Series TH28 - 2,350. Offering costs of
$253,194 and underwriting discounts of $1,762,500 have been charged to paid-in
capital.
Dividends on Series T7 AMPS and Series F7 AMPS are cumulative at a rate which
is reset every seven days based on the results of an auction. Dividends on
Series TH28 AMPS are also cumulative at a
31
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 11/30/04 (continued)
--------------------------------------------------------------------------------
rate reset every 28 days based on the results of an auction. Dividend rates
ranged from 1.05% to 2.09% during the period from April 12, 2004 to November
30, 2004.
The Trust may not declare dividends or make other distributions on its common
shares or purchase any such shares if, at the time of the declaration,
distribution or purchase, asset coverage with respect to the outstanding
preferred shares would be less than 200%.
The AMPS are redeemable at the option of the Trust, in whole or in part, on any
dividend payment date at $25,000 per share plus any accumulated or unpaid
dividends, whether or not declared. The AMPS are also subject to mandatory
redemption at $25,000 per share plus any accumulated or unpaid dividends,
whether or not declared, if certain requirements relating to the composition of
the assets and liabilities of the Trust as set forth in the Agreement and
Declaration of Trust are not satisfied.
The holders of AMPS have voting rights equal to the holders of the Trust's
common shares (one vote per share) and will vote together with holders of the
common shares as a single class. However, holders of AMPS are also entitled to
elect two of the Trust's Trustees. In addition, the Investment Company Act of
1940, as amended, requires that along with approval by shareowners that might
otherwise be required, the approval of the holders of a majority of any
outstanding preferred shares, voting separately as a class, would be required
to (a) adopt any plan of reorganization that would adversely affect the
preferred shares and (b) take any action requiring a vote of security holders,
including, among other things, changes in the Trust's subclassification as a
closed-end investment company or changes in its fundamental investment
restrictions.
6. Subsequent Events
Subsequent to November 30, 2004 the Board of Trustees of the Trust declared two
dividends from undistributed net investment income of $0.0687 per common share
one payable December 31, 2004 and one January 19, 2005 to common shareowners of
record on December 13, 2004 and December 31, 2004, respectively.
For the period December 1, 2004 to December 31, 2004, dividends declared on
preferred stock totaled $339,787 in aggregate for the three outstanding
preferred share series.
32
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
ADDITIONAL INFORMATION (unaudited)
During the period, there have been no material changes in the Trust's
investment objective or fundamental policies that have not been approved by the
shareowners. There have been no changes in the Trust's charter or By-Laws that
would delay or prevent a change in control of the Trust which have not been
approved by the shareowners. There have been no changes in the principal risk
factors associated with investment in the Trust. There have been no changes in
the persons who are primarily responsible for the day-to-day management of the
Trust's portfolio.
Notice is hereby given in accordance with Section 23(C) of the Investment
Company Act of 1940 that the Trust may purchase, from time to time, its common
shares in the open market.
IMPORTANT TAX INFORMATION (unaudited)
The following information is provided with respect to the distributions paid by
the Pioneer Tax Advantaged Balanced Trust during the taxable year ended
November 30, 2004:
----------------------------------------------------------
Tax-Exempt Interest Dividends 53.55%
Qualified Dividend Income for Individuals 45.61%
Dividends Qualifying for the Dividends Received
Deduction for Corporations 43.48%
----------------------------------------------------------
33
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
--------------------------------------------------------------------------------
To the Board of Trustees and Shareowners
of Pioneer Tax Advantaged Balanced Trust:
We have audited the accompanying statement of assets and liabilities, including
the schedule of investments, of Pioneer Tax Advantaged Balanced Trust (the
"Trust") as of November 30, 2004, and the related statements of operations and
changes in net assets, and the financial highlights, for the period from
January 28, 2004 (commencement of operations) to November 30, 2004. These
financial statements and financial highlights are the responsibility of the
Trust's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audit.
We conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the
financial statements and financial highlights are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements and financial
highlights. Our procedures included confirmation of securities owned as of
November 30, 2004, by correspondence with the custodian and brokers or by other
appropriate auditing procedures where replies from brokers were not received.
An audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of
Pioneer Tax Advantaged Balanced Trust at November 30, 2004, the results of its
operations, the changes in its net assets, and the financial highlights for the
period from January 28, 2004 (commencement of operations) to November 30, 2004,
in conformity with U.S. generally accepted accounting principles.
/s/ Ernst & Young LLP
Boston, Massachusetts
January 7, 2005
34
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
TRUSTEES, OFFICERS AND SERVICE PROVIDERS
--------------------------------------------------------------------------------
Investment Adviser
Pioneer Investment Management, Inc.
Independent Registered Public Accounting Firm
Ernst & Young LLP
Custodian
Brown Brothers Harriman & Co.
Legal Counsel
Wilmer Cutler Pickering Hale and Dorr LLP
Transfer Agent
Pioneer Investment Management Shareholder Services, Inc.
Shareowner Services and Sub-Transfer Agent
Mellon Investor Services LLC
Preferred Share Auction/Transfer Agent and Registrar
Deutsche Bank Trust Company Americas
Sub-Administrator
Princeton Administrators, L.P.
Trustees and Officers
The Trust's Board of Trustees provides broad supervision over the Trust's
affairs. The officers of the Trust are responsible for the Trust's operations.
The Trust's Trustees and officers are listed below, together with their
principal occupations during the past five years. Trustees who are interested
persons of the Trust within the meaning of the Investment Company Act of 1940
are referred to as Interested Trustees. Trustees who are not interested persons
of the Trust are referred to as Independent Trustees. Each of the Trustees
serves as a trustee of each of the 73 U.S. registered investment portfolios for
which Pioneer Investment Management, Inc. ("Pioneer") serves as investment
adviser (the "Pioneer Funds"). The address for all Interested Trustees and all
officers of the Trust is 60 State Street, Boston, Massachusetts 02109.
The Trust's statement of additional information provides more detailed
information regarding the Trust's Trustees and is available upon request,
without charge, by calling 1-800-225-6292.
Proxy Voting Policies and Procedures of the Trust are available without charge,
upon request, by calling our toll free number (1-800-225-6292). Information
regarding how the Trust voted proxies relating to portfolio securities during
the most recent 12-month period ended November 30, 2004 is publicly available
to shareowners at www.pioneerfunds.com and on the SEC's website at
http://www.sec.gov.
35
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
INTERESTED TRUSTEES
--------------------------------------------------------------------------------
Positions Held Term of Office and Principal Occupation Other Directorships Held
Name and Age With the Trust Length of Service During Past Five Years by this Trustee
John F. Cogan, Jr. (78)* Chairman of the Board, Since 1999. Deputy Chairman and a Director of Director of Harbor Global
Trustee and President Serves until Pioneer Global Asset Management Company, Ltd.
retirement or S.p.A. ("PGAM"); Non-Executive
removal Chairman and a Director of Pioneer
Investment Management USA Inc.
("PIM-USA"); Chairman and a
Director of Pioneer; Director of
Pioneer Alternative Investment
Management Limited (Dublin);
President and a Director of Pioneer
Alternative Investment Management
(Bermuda) Limited and affiliated
funds; President and Director of
Pioneer Funds Distributor, Inc.
("PFD"); President of all of the
Pioneer Funds; and Of Counsel
(since 2000, partner prior to
2000), Wilmer Cutler Pickering Hale
and Dorr LLP (counsel to PIM-USA
and the Pioneer Funds)
*Mr. Cogan is an Interested Trustee because he is an officer or director of
Pioneer and certain of its affiliates.
------------------------------------------------------------------------------------------------------------------------------------
Osbert M. Hood (52)** Trustee and Since June, 2003. President and Chief Executive None
Executive Vice Serves until Officer, PIM-USA since May 2003
President retirement or (Director since January 2001);
removal President and Director of Pioneer
since May 2003; Chairman and
Director of Pioneer Investment
Management Shareholder Services,
Inc. ("PIMSS") since May 2003;
Executive Vice President of all of
the Pioneer Funds since June 2003;
Executive Vice President and Chief
Operating Officer of PIM-USA,
November 2000 to May 2003;
Executive Vice President, Chief
Financial Officer and Treasurer,
John Hancock Advisers, L.L.C.,
Boston, MA, November 1999 to
November 2000; Senior Vice
President and Chief Financial
Officer, John Hancock Advisers,
L.L.C., April 1997 to November 1999
**Mr. Hood is an Interested Trustee because he is an officer or director of
Pioneer and certain of its affiliates. Pioneer Tax Advantaged Balanced Trust
------------------------------------------------------------------------------------------------------------------------------------
36
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
INDEPENDENT TRUSTEES
--------------------------------------------------------------------------------
Positions Held Term of Office and Principal Occupation Other Directorships Held
Name, Age and Address With the Trust Length of Service During Past Five Years by this Trustee
Mary K. Bush (56) Trustee Since 1999. President, Bush International Director of Brady
3509 Woodbine Street, Serves until (international financial advisory Corporation (industrial
Chevy Chase, MD 20815 retirement or firm) identification and
removal specialty coated material
products manufacturer),
Millennium Chemicals,
Inc. (commodity
chemicals), Mortgage
Guaranty Insurance
Corporation, and R.J.
Reynolds Tobacco
Holdings, Inc. (tobacco)
------------------------------------------------------------------------------------------------------------------------------------
Richard H. Egdahl, M.D. (77)+ Trustee Since 1999. Alexander Graham Bell Professor of None
Boston University Healthcare Serves until Health Care Entrepreneurship, Boston
Entrepreneurship Program, retirement or University; Professor of Management,
53 Bay State Road, removal Boston University School of
Boston, MA 02215 Management; Professor of Public
Health, Boston University School of
Public Health; Professor of Surgery,
Boston University School of Medicine;
and University Professor, Boston
University
------------------------------------------------------------------------------------------------------------------------------------
Margaret B.W. Graham (57) Trustee Since 1999. Founding Director, The Winthrop Group, None
1001 Sherbrooke Street West, Serves until Inc. (consulting firm); Professor of
Montreal, Quebec, Canada retirement or Management, Faculty of Management,
H3A 1G5 removal McGill University
------------------------------------------------------------------------------------------------------------------------------------
+ Retired, effective 12/31/04
37
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
INDEPENDENT TRUSTEES (continued)
--------------------------------------------------------------------------------
Positions Held Term of Office and Principal Occupation Other Directorships Held
Name, Age and Address With the Trust Length of Service During Past Five Years by this Trustee
Marguerite A. Piret (56) Trustee Since 1999. President and Chief Executive Officer, Director of New America
One Boston Place, 28th Floor, Serves until Newbury, Piret & Company, Inc. High Income Fund, Inc.
Boston, MA 02108 retirement or (investment banking firm) (closed-end investment
removal company)
------------------------------------------------------------------------------------------------------------------------------------
Stephen K. West (76) Trustee Since 1999. Senior Counsel, Sullivan & Cromwell Director, The Swiss
125 Broad Street, Serves until (law firm) Helvetia Fund, Inc.
New York, NY 10004 retirement or (closed-end investment
removal company) and
AMVESCAP PLC
(investment managers)
------------------------------------------------------------------------------------------------------------------------------------
John Winthrop (68) Trustee Since 1999. President, John Winthrop & Co., Inc. None
One North Adgers Wharf, Serves until (private investment firm)
Charleston, SC 29401 retirement or
removal
------------------------------------------------------------------------------------------------------------------------------------
38
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
TRUST OFFICERS
--------------------------------------------------------------------------------
Positions Held Term of Office and Principal Occupation Other Directorships Held
Name and Age With the Trust Length of Service During Past Five Years by this Officer
Dorothy E. Bourassa (56) Secretary Since September, Secretary of PIM-USA; Senior Vice None
2003. President-Legal of Pioneer; and
Serves at the Secretary/Clerk of most of
discretion of PIM-USA's subsidiaries since
board. October 2000; Secretary of all of
the Pioneer Funds since September
2003 (Assistant Secretary from
November 2000 to September 2003);
and Senior Counsel, Assistant Vice
President and Director of
Compliance of PIM-USA from April
1998 through October 2000
------------------------------------------------------------------------------------------------------------------------------------
Christopher J. Kelley (39) Assistant Secretary Since September, Assistant Vice President and None
2003. Senior Counsel of Pioneer since
Serves at the July 2002; Vice President and
discretion of board. Senior Counsel of BISYS Fund
Services, Inc. (April 2001 to June
2002); Senior Vice President and
Deputy General Counsel of Funds
Distributor, Inc. (July 2000 to
April 2001); Vice President and
Associate General Counsel from
July 1996 to July 2000; Assistant
Secretary of all of the Pioneer
Funds since September 2003
------------------------------------------------------------------------------------------------------------------------------------
David C. Phelan (47) Assistant Secretary Since September, Partner, William Cutler Pickering None
2003. Hale and Dorr LLP; Assistant
Serves at the Secretary of all of Pioneer Funds
discretion of board. since September 2003
------------------------------------------------------------------------------------------------------------------------------------
Vincent Nave (59) Treasurer Since November, Vice President-Fund Accounting, None
2000. Administration and Custody
Serves at the Services of Pioneer (Manager from
discretion of board. September 1996 to February 1999);
and Treasurer of all of the
Pioneer Funds (Assistant Treasurer
from June 1999 to November 2000)
------------------------------------------------------------------------------------------------------------------------------------
39
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
TRUST OFFICERS (continued)
--------------------------------------------------------------------------------
Positions Held Term of Office and Principal Occupation Other Directorships Held
Name and Age With the Trust Length of Service During Past Five Years by this Officer
Mark E. Bradley (45) Assistant Treasurer Since November Deputy Treasurer of Pioneer since None
2004. 2004; Treasurer and Senior Vice
Serves at the President, CDC IXIS Asset
discretion of Management Services from 2002 to
the board. 2003; Assistant Treasurer and
Vice President, MFS Investment
Management from 1997 to 2002; and
Assistant Treasurer of all of the
Pioneer Funds since November 2004
------------------------------------------------------------------------------------------------------------------------------------
Luis I. Presutti (39) Assistant Treasurer Since November, Assistant Vice President-Fund None
2000. Accounting, Administration and
Serves at the Custody Services of Pioneer (Fund
discretion of board. Accounting Manager from 1994 to
1999); and Assistant Treasurer of
all of the Pioneer Funds since
November 2000
------------------------------------------------------------------------------------------------------------------------------------
Gary Sullivan (46) Assistant Treasurer Since May, 2002. Fund Accounting Manager-Fund None
Serves at the Accounting, Administration and
discretion of board. Custody Services of Pioneer; and
Assistant Treasurer of all of the
Pioneer Funds since May 2002
------------------------------------------------------------------------------------------------------------------------------------
Katherine Kim Sullivan (30) Assistant Treasurer Since September, Fund Administration Manager-Fund None
2003. Accounting, Administration and
Serves at the Custody Services since June 2003;
discretion of board. Assistant Vice President-Mutual
Fund Operations of State Street
Corporation from June 2002 to
June 2003 (formerly Deutsche Bank
Asset Management); Pioneer Fund
Accounting, Administration and
Custody Services (Fund Accounting
Services Manager from August 1999
to May 2002, Fund Accounting
Supervisor from 1997 to July
1999); Assistant Treasurer of all
of the Pioneer Funds since
September 2003
------------------------------------------------------------------------------------------------------------------------------------
40
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Positions Held Term of Office and Other Directorships Held
Name and Age With the Trust Length of Service Principal Occupation During Past Five Years by this Officer
Martin J. Wolin (37) Chief Compliance Since October 2004. Chief Compliance Officer of Pioneer (Director None
Officer Serves at the of Compliance and Senior Counsel from
discretion of the November 2000 to September 2004); Vice
board. President and Associate General Counsel of
UAM Fund Services, Inc. (mutual fund
administration company) from February 1998 to
November 2000; and Chief Compliance Officer
of all of the Pioneer Funds.
------------------------------------------------------------------------------------------------------------------------------------
The outstanding capital stock of Pioneer Tax Advantaged Balanced Trust, Pioneer
and PIMSS is indirectly wholly owned by UniCredito Italiano S.p.A. ("UniCredito
Italiano"), one of the largest banking groups in Italy. Pioneer, the Trust's
investment adviser, provides investment management and financial services to
mutual funds, institutional and other clients.
41
--------------------------------------------------------------------------------
THE PIONEER FAMILY OF MUTUAL FUNDS
--------------------------------------------------------------------------------
Please consider a fund's investment objective, risks, charges and expenses
carefully before investing. The prospectus contains this and other information
about a fund and should be read carefully before you invest or send money. To
obtain a prospectus and for other information on any Pioneer fund, contact your
advisor, call 1-800-225-6292 or visit our web site at www.pioneerfunds.com.
U.S. Equity
Pioneer Fund
Pioneer Balanced Fund
Pioneer Equity Income Fund
Pioneer Equity Opportunity Fund
Pioneer Growth Shares
Pioneer Mid Cap Growth Fund
Pioneer Mid Cap Value Fund
Pioneer Oak Ridge Large Cap
Growth Fund
Pioneer Oak Ridge Small Cap
Growth Fund
Pioneer Papp America-Pacific
Rim Fund
Pioneer Papp Small and Mid Cap
Growth Fund
Pioneer Papp Stock Fund
Pioneer Papp Strategic
Growth Fund
Pioneer Real Estate Shares
Pioneer Research Fund*
Pioneer Small Cap Value Fund
Pioneer Small Company Fund
Pioneer Value Fund
Asset Allocation
Pioneer Ibbotson Moderate
Allocation Fund
Pioneer Ibbotson Growth
Allocation Fund
Pioneer Ibbotson Aggressive
Allocation Fund
International/Global Equity
Pioneer Emerging Markets Fund
Pioneer Europe Select Fund
Pioneer Europe Fund
Pioneer International Equity Fund
Pioneer International Value Fund
Fixed Income
Pioneer America Income Trust
Pioneer Bond Fund
Pioneer Global High Yield Fund
Pioneer High Yield Fund
Pioneer Short Term Income Fund
Pioneer Strategic Income Fund
Pioneer Tax Free Income Fund
Money Market
Pioneer Cash Reserves Fund**
* Name change effective December 11, 2003. Formerly known as Pioneer Core
Equity Fund.
** An investment in the Fund is not insured or guaranteed by the Federal Deposit
Insurance Corporation or any other government agency. Although the Fund seeks
to preserve the value of your investment at $1.00 per share, it is possible
to lose money by investing in the Fund.
42
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This page for your notes.
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This page for your notes.
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HOW TO CONTACT PIONEER
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We are pleased to offer a variety of convenient ways for you to contact us for
assistance or information.
You can call Mellon Investor Services LLC for:
Account Information 1-800-710-0935
Telecommunications Device for the Deaf (TDD) 1-800-231-5469
Or write to Mellon Investor Services LLC:
For Write to
General inquiries, lost dividend checks P.O. Box 3315
South Hackensack, NJ
07606-1915
Change of address, account consolidation P.O. Box 3316
South Hackensack, NJ
07606-1916
Lost stock certificates P.O. Box 3317
South Hackensack, NJ
07606-1917
Stock transfer P.O. Box 3312
South Hackensack, NJ
07606-1912
Dividend reinvestment plan (DRIP) P.O. Box 3338
South Hackensack, NJ
07606-1938
Please consider the Trust's investment objectives, risks, charges and expenses
carefully before investing. The prospectus contains this and other information
about the Trust and should be read carefully before you invest or send money. To
obtain a prospectus and for other information on any Pioneer fund, call
1-800-225-6292 or visit our website www.pioneerfunds.com.
The Trust files a complete statement of investments with the Securities and
Exchange Commission for the first and third quarters for each fiscal year on
Form N-Q. Shareholders may view the filed Form N-Q by visiting the Commission's
website at http://www.sec.gov. The filed form may also be viewed and copied at
the Commission's Public Reference Room in Washington, DC. Information regarding
the operations of the Public Reference Room may be obtained by calling
1-800-SEC-0330.
ITEM 2. CODE OF ETHICS.
(a) Disclose whether, as of the end of the period covered by the report, the
registrant has adopted a code of ethics that applies to the registrant's
principal executive officer, principal financial officer, principal accounting
officer or controller, or persons performing similar functions, regardless of
whether these individuals are employed by the registrant or a third party. If
the registrant has not adopted such a code of ethics, explain why it has not
done so.
The registrant has adopted, as of the end of the period covered by this report,
a code of ethics that applies to the registrant's principal executive officer,
principal financial officer, principal accounting officer and controller.
(b) For purposes of this Item, the term "code of ethics" means written standards
that are reasonably designed to deter wrongdoing and to promote:
(1) Honest and ethical conduct, including the ethical handling of actual
or apparent conflicts of interest between personal and professional
relationships;
(2) Full, fair, accurate, timely, and understandable disclosure in
reports and documents that a registrant files with, or submits to, the
Commission and in other public communications made by the registrant;
(3) Compliance with applicable governmental laws, rules, and
regulations;
(4) The prompt internal reporting of violations of the code to an
appropriate person or persons identified in the code; and
(5) Accountability for adherence to the code.
(c) The registrant must briefly describe the nature of any amendment, during the
period covered by the report, to a provision of its code of ethics that applies
to the registrant's principal executive officer, principal financial officer,
principal accounting officer or controller, or persons performing similar
functions, regardless of whether these individuals are employed by the
registrant or a third party, and that relates to any element of the code of
ethics definition enumerated in paragraph (b) of this Item. The registrant must
file a copy of any such amendment as an exhibit pursuant to Item 10(a), unless
the registrant has elected to satisfy paragraph (f) of this Item by posting its
code of ethics on its website pursuant to paragraph (f)(2) of this Item, or by
undertaking to provide its code of ethics to any person without charge, upon
request, pursuant to paragraph (f)(3) of this Item.
The registrant has made no amendments to the code of ethics during the period
covered by this report.
(d) If the registrant has, during the period covered by the report, granted a
waiver, including an implicit waiver, from a provision of the code of ethics to
the registrant's principal executive officer, principal financial officer,
principal accounting officer or controller, or persons performing similar
functions, regardless of whether these individuals are employed by the
registrant or a third party, that relates to one or more of the items set forth
in paragraph (b) of this Item, the registrant must briefly describe the nature
of the waiver, the name of the person to whom the waiver was granted, and the
date of the waiver.
Not applicable.
(e) If the registrant intends to satisfy the disclosure requirement under
paragraph (c) or (d) of this Item regarding an amendment to, or a waiver from,
a provision of its code of ethics that applies to the registrant's principal
executive officer, principal financial officer, principal accounting officer or
controller, or persons performing similar functions and that relates to any
element of the code of ethics definition enumerated in paragraph (b) of this
Item by posting such information on its Internet website, disclose the
registrant's Internet address and such intention.
Not applicable.
(f) The registrant must:
(1) File with the Commission, pursuant to Item 10(a), a copy of its code
of ethics that applies to the registrant's principal executive officer,
principal financial officer, principal accounting officer or controller,
or persons performing similar functions, as an exhibit to its annual
report on this Form N-CSR;
(2) Post the text of such code of ethics on its Internet website and
disclose, in its most recent report on this Form N-CSR, its Internet
address and the fact that it has posted such code of ethics on its
Internet website; or
(3) Undertake in its most recent report on this Form N-CSR to provide to
any person without charge, upon request, a copy of such code of ethics
and explain the manner in which such request may be made.
See Item 10(2)
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
(a) (1) Disclose that the registrant's board of trustees has determined that
the registrant either:
(i) Has at least one audit committee financial expert serving on its audit
committee; or
(ii) Does not have an audit committee financial expert serving on its audit
committee.
The registrant's Board of Trustees has determined that the registrant has at
least one audit committee financial expert.
(2) If the registrant provides the disclosure required by paragraph
(a)(1)(i) of this Item, it must disclose the name of the audit committee
financial expert and whether that person is "independent." In order to be
considered "independent" for purposes of this Item, a member of an audit
committee may not, other than in his or her capacity as a member of the audit
committee, the board of trustees, or any other board committee:
(i) Accept directly or indirectly any consulting, advisory, or other
compensatory fee from the issuer; or
(ii) Be an "interested person" of the investment company as defined in
Section 2(a)(19) of the Act (15 U.S.C. 80a-2(a)(19)).
Ms. Marguerite A. Piret, an independent trustee, is such an audit committee
financial expert.
(3) If the registrant provides the disclosure required by paragraph (a)(1)
(ii) of this Item, it must explain why it does not have an audit committee
financial expert.
Not applicable.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
(a) Disclose, under the caption AUDIT FEES, the aggregate fees billed for each
of the last two fiscal years for professional services rendered by the principal
accountant for the audit of the registrant's annual financial statements or
services that are normally provided by the accountant in connection with
statutory and regulatory filings or engagements for those fiscal years.
Audit Fees
Fees for audit services provided to the Trust, including
fees associated with the initial and updated filings of
its Form N-2 and issuance of various comfort letters,
totaled approximately $80,500 in 2004.
(b) Disclose, under the caption AUDIT-RELATED FEES, the aggregate fees billed in
each of the last two fiscal years for assurance and related services by the
principal accountant that are reasonably related to the performance of the audit
of the registrant's financial statements and are not reported under
paragraph (a) of this Item. Registrants shall describe the nature of the
services comprising the fees disclosed under this category.
Audit-Related Fees
Fees for the Trusts audit-related services totaled
approximately $13,000 in 2004. These services
included issuance of agreed upon procedures report to
the rating agencies.
(c) Disclose, under the caption TAX FEES, the aggregate fees billed in each of
the last two fiscal years for professional services rendered by the principal
accountant for tax compliance, tax advice, and tax planning. Registrants shall
describe the nature of the services comprising the fees disclosed under this
category.
Tax Fees
Fees for tax compliance services, primarily for tax
return, totaled $6,000 in 2004.
(d) Disclose, under the caption ALL OTHER FEES, the aggregate fees billed in
each of the last two fiscal years for products and services provided by the
principal accountant, other than the services reported in paragraphs (a) through
(c) of this Item. Registrants shall describe the nature of the services
comprising the fees disclosed under this category.
Other Fees
There were no other services provided to the Trust
during the fiscal year ended November 30, 2004.
(e) (1) Disclose the audit committee's pre-approval policies and procedures
described in paragraph (c)(7) of Rule 2-01 of Regulation S-X.
PIONEER FUNDS
APPROVAL OF AUDIT, AUDIT-RELATED, TAX AND OTHER SERVICES
PROVIDED BY THE INDEPENDENT AUDITOR
SECTION I - POLICY PURPOSE AND APPLICABILITY
The Pioneer Funds recognizes the importance of maintaining the independence of
their outside auditors. Maintaining independence is a shared responsibility
involving Pioneer Investment Management, Inc ("PIM"), the audit committee and
the independent auditors.
The Funds recognizes that a Fund's independent auditors: 1) possess knowledge of
the Funds, 2) are able to incorporate certain services into the scope of the
audit, thereby avoiding redundant work, cost and disruption of Fund personnel
and processes, and 3) have expertise that has value to the Funds. As a result,
there are situations where it is desirable to use the Fund's independent
auditors for services in addition to the annual audit and where the potential
for conflicts of interests are minimal. Consequently, this policy, which is
intended to comply with Rule 210.2-01(C)(7), sets forth guidelines and
procedures to be followed by the Funds when retaining the independent audit firm
to perform audit, audit-related tax and other services under those
circumstances, while also maintaining independence.
Approval of a service in accordance with this policy for a Fund shall also
constitute approval for any other Fund whose pre-approval is required pursuant
to Rule 210.2-01(c)(7)(ii).
In addition to the procedures set forth in this policy, any non-audit services
that may be provided consistently with Rule 210.2-01 may be approved by the
Audit Committee itself and any pre-approval that may be waived in accordance
with Rule 210.2-01(c)(7)(i)(C) is hereby waived.
Selection of a Fund's independent auditors and their compensation shall be
determined by the Audit Committee and shall not be subject to this policy.
SECTION II - POLICY
---------------- -------------------------------- -------------------------------------------------
SERVICE SERVICE CATEGORY DESCRIPTION SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
CATEGORY
---------------- -------------------------------- -------------------------------------------------
I. AUDIT Services that are directly o Accounting research assistance
SERVICES related to performing the o SEC consultation, registration
independent audit of the Funds statements, and reporting
o Tax accrual related matters
o Implementation of new accounting
standards
o Compliance letters (e.g. rating agency
letters)
o Regulatory reviews and assistance
regarding financial matters
o Semi-annual reviews (if requested)
o Comfort letters for closed end
offerings
---------------- -------------------------------- -------------------------------------------------
II. Services which are not o AICPA attest and agreed-upon procedures
AUDIT-RELATED prohibited under Rule o Technology control assessments
SERVICES 210.2-01(C)(4) (the "Rule") o Financial reporting control assessments
and are related extensions of o Enterprise security architecture
the audit services support the assessment
audit, or use the
knowledge/expertise gained
from the audit procedures as a
foundation to complete the
project. In most cases, if
the Audit-Related Services are
not performed by the Audit
firm, the scope of the Audit
Services would likely
increase. The Services are
typically well-defined and
governed by accounting
professional standards (AICPA,
SEC, etc.)
---------------- -------------------------------- -------------------------------------------------
------------------------------------- ------------------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------- ------------------------------------
o "One-time" pre-approval o A summary of all such
for the audit period for all services and related fees
pre-approved specific service reported at each regularly
subcategories. Approval of the scheduled Audit Committee
independent auditors as meeting.
auditors for a Fund shall
constitute pre approval for
these services.
------------------------------------- ------------------------------------
o "One-time" pre-approval o A summary of all such
for the fund fiscal year within services and related fees
a specified dollar limit (including comparison to
for all pre-approved specified dollar limits)
specific service subcategories reported quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limit for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for Audit-Related
Services not denoted as
"pre-approved", or
to add a specific service
subcategory as "pre-approved"
------------------------------------- ------------------------------------
SECTION III - POLICY DETAIL, CONTINUED
----------------------- --------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
DESCRIPTION
----------------------- --------------------------- -----------------------------------------------
III. TAX SERVICES Services which are not o Tax planning and support
prohibited by the Rule, o Tax controversy assistance
if an officer of the Fund o Tax compliance, tax returns, excise
determines that using the tax returns and support
Fund's auditor to provide o Tax opinions
these services creates
significant synergy in
the form of efficiency,
minimized disruption, or
the ability to maintain a
desired level of
confidentiality.
----------------------- --------------------------- -----------------------------------------------
------------------------------------- -------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------- -------------------------
------------------------------------- -------------------------
o "One-time" pre-approval o A summary of
for the fund fiscal year all such services and
within a specified dollar limit related fees
(including comparison
to specified dollar
limits) reported
quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limits for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for tax services not
denoted as pre-approved, or to add a specific
service subcategory as
"pre-approved"
------------------------------------- -------------------------
SECTION III - POLICY DETAIL, CONTINUED
----------------------- --------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
DESCRIPTION
----------------------- --------------------------- -----------------------------------------------
IV. OTHER SERVICES Services which are not o Business Risk Management support
prohibited by the Rule, o Other control and regulatory
A. SYNERGISTIC, if an officer of the Fund compliance projects
UNIQUE QUALIFICATIONS determines that using the
Fund's auditor to provide
these services creates
significant synergy in
the form of efficiency,
minimized disruption,
the ability to maintain a
desired level of
confidentiality, or where
the Fund's auditors
posses unique or superior
qualifications to provide
these services, resulting
in superior value and
results for the Fund.
----------------------- --------------------------- -----------------------------------------------
--------------------------------------- ------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------- --------------------------
o "One-time" pre-approval o A summary of
for the fund fiscal year within all such services and
a specified dollar limit related fees
(including comparison
to specified dollar
limits) reported
quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limits for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for "Synergistic" or
"Unique Qualifications" Other
Services not denoted as
pre-approved to the left, or to
add a specific service
subcategory as "pre-approved"
------------------------------------- --------------------------
SECTION III - POLICY DETAIL, CONTINUED
----------------------- ------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PROHIBITED SERVICE SUBCATEGORIES
DESCRIPTION
----------------------- ------------------------- -----------------------------------------------
PROHIBITED SERVICES Services which result 1. Bookkeeping or other services
in the auditors losing related to the accounting records or
independence status financial statements of the audit
under the Rule. client*
2. Financial information systems design
and implementation*
3. Appraisal or valuation services,
fairness* opinions, or
contribution-in-kind reports
4. Actuarial services (i.e., setting
actuarial reserves versus actuarial
audit work)*
5. Internal audit outsourcing services*
6. Management functions or human
resources
7. Broker or dealer, investment
advisor, or investment banking services
8. Legal services and expert services
unrelated to the audit
9. Any other service that the Public
Company Accounting Oversight Board
determines, by regulation, is
impermissible
----------------------- ------------------------- -----------------------------------------------
------------------------------------------- ------------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------------- ------------------------------
o These services are not to be o A summary of all
performed with the exception of the(*) services and related
services that may be permitted fees reported at each
if they would not be subject to audit regularly scheduled
procedures at the audit client (as Audit Committee meeting
defined in rule 2-01(f)(4)) level will serve as continual
the firm providing the service. confirmation that has
not provided any
restricted services.
------------------------------------------- ------------------------------
--------------------------------------------------------------------------------
GENERAL AUDIT COMMITTEE APPROVAL POLICY:
o For all projects, the officers of the Funds and the Fund's auditors will each
make an assessment to determine that any proposed projects will not impair
independence.
o Potential services will be classified into the four non-restricted service
categories and the "Approval of Audit, Audit-Related, Tax and Other
Services" Policy above will be applied. Any services outside the specific
pre-approved service subcategories set forth above must be specifically
approved by the Audit Committee.
o At least quarterly, the Audit Committee shall review a report summarizing the
services by service category, including fees, provided by the Audit firm as
set forth in the above policy.
--------------------------------------------------------------------------------
(2) Disclose the percentage of services described in each of paragraphs (b)
through (d) of this Item that were approved by the audit committee pursuant
to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.
N/A
(f) If greater than 50 percent, disclose the percentage of hours expended on the
principal accountant's engagement to audit the registrant's financial statements
for the most recent fiscal year that were attributed to work performed by
persons other than the principal accountant's full-time, permanent employees.
N/A
(g) Disclose the aggregate non-audit fees billed by the registrant's accountant
for services rendered to the registrant, and rendered 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 for each of
the last two fiscal years of the registrant.
The Fund's independent auditor, Ernst & Young
LLP ("E&Y"), recently has advised the Securities
and Exchange Commission, the Public Company
Accounting Oversight Board, and the Audit
Committee of the Fund's Board of Trustees that
certain non-audit work performed by E&Y's China
affiliate has raised questions regarding E&Y's
independence with respect to its performance of
audit services for the Fund. In July 2004, E&Y
became aware that member firms in China ("E&Y
China") provided certain tax services to offices of
UniCredito Italiano, S.p.A. ("UCI"), a member of
the Fund's Investment Company Complex. The
services included receipt and disbursement of
monies transferred to E&Y China by UCI in
payment of individual expatriate income taxes due
on returns prepared by E&Y China for certain UCI
employees located in China from October 1998 to
May 2003. E&Y became auditors of the Fund in
May 2002. These expatriate tax services were
discontinued in May 2003. The fees received by
E&Y China for all such services totaled $3,685.
The Fund's Audit Committee and E&Y have
discussed the matter, including the nature of the
services provided, the personnel involved in
providing the services and the fees received by
E&Y for performing the services. The Committee
continues to review the facts and circumstances
surrounding the matter, including the issue of
whether the monies transferred for employees' taxes
were de facto monies due the employees for tax
payments rather than monies belonging to UCI.
E&Y has informed the Audit Committee that based
on its internal reviews and the de minimis nature of
the services provided and fees received, it does not
believe its independence with respect to the Fund
has been impaired.
Aggregate Non-Audit Fees
The aggregate non-audit fees for the Trust and
affiliates, as previously defined, totaled $19,000 in
2004.
(h) Disclose whether the registrant's audit committee of the board of trustees
has considered whether the provision of non-audit services that were rendered to
the registrant's investment adviser (not including any subadviser 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 investment adviser that provides ongoing services to the
registrant that were not pre-approved pursuant to paragraph (c)(7)(ii) of
Rule 2-01 of Regulation S-X is compatible with maintaining the principal
accountant's independence.
Non-Audit Services
Beginning with non-audit service contracts entered
into on or after May 6, 2003, the effective date of the
new SEC pre-approval rules, the Trusts audit
committee is required to pre-approve services to
affiliates defined by SEC rules to the extent that the
services are determined to have a direct impact on the
operations or financial reporting of the Trust. For the
year ended November 30, 2004, there were no services
provided to an affiliate that required the Trusts audit
committee pre-approval.
The Trust's audit committee of the Board of Trustees
has considered whether the provision of non-audit
services that were rendered to the Affiliates (as
defined) that were not pre-approved pursuant to
paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is
compatible with maintaining the principal accountant's
independence.
ITEMS 5-6. [RESERVED]
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
A closed-end management investment company that is filing an annual report on
this Form N-CSR must, unless it invests exclusively in non-voting securities,
describe the policies and procedures that it uses to determine how to vote
proxies relating to portfolio securities, including the procedures that the
company uses when a vote presents a conflict between the interests of its
shareholders, on the one hand, and those of the company's investment adviser;
principal underwriter; or any affiliated person (as defined in Section 2(a)(3)
of the Investment Company Act of 1940 (15 U.S.C. 80a-2(a)(3)) and the rules
thereunder) of the company, its investment adviser, or its principal
underwriter, on the other. Include any policies and procedures of the company's
investment adviser, or any other third party, that the company uses, or that are
used on the company's behalf, to determine how to vote proxies relating to
portfolio securities.
Not applicable to open-end management investment companies.
ITEM 8. [RESERVED]
ITEM 9. CONTROLS AND PROCEDURES.
(a) Disclose the conclusions of the registrant's principal executive officer or
officers and principal financial officer or officers, or persons performing
similar functions, about the effectiveness of the registrant's disclosure
controls and procedures (as defined in Rule 30a-2(c) under the Act (17 CFR
270.30a-2(c))) based on their evaluation of these controls and procedures as of
a date within 90 days of the filing date of the report that includes the
disclosure required by this paragraph.
The registrant's principal executive officer and principal financial
officer have concluded, that the registrant's disclosure controls and
procedures are effective based on their evaluation of these controls and
procedures as of a date within 90 days of the filing date of this report.
(b) Disclose whether or not there were significant changes in the registrant's
internal controls or in other factors that could significantly affect these
controls subsequent to the date of their evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
There were no significant changes in the registrant's internal controls or
in other factors that could significantly affect these controls subsequent to
the date of their evaluation, including any corrective actions with regard
to significant deficiencies and material weaknesses.
ITEM 10. EXHIBITS.
File the exhibits listed below as part of this Form. Letter or number the
exhibits in the sequence indicated.
(a) Any code of ethics, or amendment thereto, that is the subject of the
disclosure required by Item 2, to the extent that the registrant intends to
satisfy the Item 2 requirements through filing of an exhibit.
(b) A separate certification for each principal executive officer and principal
financial officer of the registrant as required by Rule 30a-2 under the Act
(17 CFR 270.30a-2).
Filed herewith.
SIGNATURES
[See General Instruction F]
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) Pioneer Tax Advantaged Balanced Trust
By (Signature and Title)* /s/ John F. Cogan, Jr.
John F. Cogan, Jr, President
Date January 25, 2004
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 (Signature and Title)* /s/ John F. Cogan, Jr.
John F. Cogan, Jr., President
Date January 25, 2004
By (Signature and Title)* /s/ Vincent Nave
Vincent Nave, Treasurer
Date January 25, 2004
* Print the name and title of each signing officer under his or her signature.