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 811-05984
----------
The New Ireland Fund, Inc.
(Exact name of registrant as specified in charter)
Bank of Ireland Asset Management (U.S.) Limited
300 First Stamford Place
Stamford, CT 06902
-----------------------------------------------
(Address of principal executive offices) (Zip code)
PFPC Inc.
99 High Street, 27th Floor
Boston, MA 02110
------------------------------------------------------------------
(Name and address of agent for service)
Registrant's telephone number, including area code: (203) 328-1820
---------------
Date of fiscal year end: October 31
------------
Date of reporting period: October 31,2007
---------------
Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 100 F Street, NE,
Washington, DC 20549. The OMB has reviewed this collection of information under
the clearance requirements of 44 U.S.C. ss. 3507.
ITEM 1. REPORTS TO STOCKHOLDERS.
The Report to Shareholders is attached herewith.
--------------------------------------------------------------------------------
THE
NEW IRELAND
FUND
[GRAPHIC OMITTED]
ANNUAL REPORT
OCTOBER 31, 2007
--------------------------------------------------------------------------------
COVER PHOTOGRAPH -- BELFAST CITY HALL, BELFAST, NORTHERN IRELAND
PROVIDED COURTESY OF TOURISM IRELAND
LETTER TO SHAREHOLDERS
Dear Shareholder,
INTRODUCTION
As may be seen in the Economic Review section on the next page, the Irish
economy remains strong although the growth forecast for the current year has
been reduced to 4.75% with the expectation for 2008 being 3.5%. In the context
of the Western European economies, these growth rates are still very
satisfactory as Ireland continues to grow at a faster pace than most other
countries.
Over the past 12 months, the Fund's Net Asset Value ("NAV") increased by
only 2.88%, as a result of the substantial drop in the Irish Equities market
("ISEQ") over recent months. This fall in the ISEQ reflects the sub-prime
debacle here in the U.S. as well as the downward trend in the residential
housing market in Ireland. Having said this, the drop has been substantially
worse than in other European markets and it is hoped that a correction will take
place over coming months to bring the ISEQ back in line with its European peer
markets. Another reason is the fact that three of the top six companies in the
ISEQ, by capitalization, are financial institutions, whose stock prices appear
to have over-reacted to the U.S. sub-prime problems.
In early November, the Board of the Fund declared a distribution for the
fiscal year ended October 31, 2007, in an amount of $5.22 per share. This will
be a stock distribution however shareholders are being given the option of
taking the distribution in cash, should they so wish. The $5.22 per share is
comprised of long-term capital gains of $4.66, short-term capital gains of $0.20
and net investment income of $0.36. The distribution will be made under date of
December 28, 2007 to all shareholders of record on November 16, 2007.
In late November, Mr. Brendan Donohoe, Director and President of the Fund,
resigned from these positions because he will no longer be resident in the
United States. We were sorry to learn of this because, over these past few
years, we very much valued his contributions both as a Director and as President
of the Fund. On behalf of the Board, I would like to thank him, most sincerely,
for his commitment to the Fund. The Board recently appointed Mr. Michael Grealy
to fill the vacancies of Director and President resulting from Mr. Donohoe's
resignation.
PERFORMANCE
For the fiscal year just ended, the Fund's NAV increased by 2.88% compared
to a rise of 3.94% in the ISEQ index, in U.S. dollar terms*, and a rise of 6.0%
excluding Bank of Ireland, in which the Fund is precluded from investing. The
performance of the Irish market was again weak in the fourth fiscal quarter,
underperforming most European and developed International markets. Over the
quarter, the Fund's NAV decreased by 4.9% as compared to a 2.4% decline in the
ISEQ. Excluding Bank of Ireland, the Irish market was
* All returns are quoted in U.S. Dollars unless otherwise stated.
1
down 2.2%. The Fund's underperformance relative to its benchmark, over the
quarter, was due to the knock-on effect of the sub-prime situation in the U.S.
as well as being due to it not holding an investment in the pharmaceutical
company Elan, the fourth largest stock in the ISEQ, which rose 32% on continued
optimism in relation to a number of it's pipeline drugs.
The Euro rose by 5.7% and 13.3% against the U.S. dollar over the three and
twelve month periods respectively.
During fiscal 2007, we continued to implement the Share Repurchase Program
(the "Program") and over the 12 months, the Fund repurchased and retired 125,300
shares at a cost of $3.70 million. These repurchases represent a reduction of
2.70% of the shares outstanding at October 31, 2006 and they positively impacted
the Fund's NAV by 7 cents per share. Since commencement of the Program in fiscal
2000, repurchases have totaled 1,440,550 shares representing 23.4% of total
shares, which have been issued by the Fund.
ECONOMIC REVIEW
The Irish economy continues to expand at a robust pace, although the rate
of expansion is likely to decelerate into 2008. Latest Central Bank of Ireland
("CBOI") forecasts project GDP growth of 4.75% in 2007 and 3.5% in 2008. The
international backdrop remains generally favorable although the recent
turbulence in global financial markets has shifted the balance of risk to the
downside. U.S. economic growth looks set to continue to decelerate while
European growth, though still relatively strong, is also showing some signs of
softness. Elsewhere growth continues to be strong, particularly in Asia, with
China and India being driven by exceptional domestic demand.
Irish domestic demand has been strong in recent years, driven primarily by
residential investment and consumer spending. All available evidence suggests
that housing completions peaked in 2006 at 88,000 units and will decline
reasonably sharply to a more sustainable level of output. The CBOI predicts
75,000 units in 2007 and 65,000 units in 2008 although leading indicators
suggest that the 2008 outcome could be even lower. Private consumption
expenditure and spending on home improvements will likely maintain greater
momentum in the short term boosted by the release of funds from maturing Special
Savings Incentive Accounts ("SSIAs") and a strong pick up in rents.
Non-residential spending is expected to remain robust given a healthy commercial
property market and major spending on infrastructure under the National
Development Plan. Export performance has slowed slightly from the strong start
to the year but activity remains well above previous years.
Global inflationary signals have been mixed in recent months with some
easing in the U.S. and U.K. but with more persistent inflation throughout
Europe. With regard to monetary policy, the U.S. Federal Reserve has eased
interest rates 0.75% in response to the credit crisis while interest rates in
the Euro Zone and the U.K. would appear to be on hold at present.
Irish consumer sentiment fell in October with the 3-month moving average
falling to 72.7 from the 73.6 recorded in September. The 3-month moving
2
average stood at 86.0 in October 2006. Consumers' perception of their current
and future financial situations weakened in October. Respondents appeared
concerned with regard to the outlook for the labor market and the overall
economy over the next 12 months.
The Live Employment Register trends show continued resilience in the labor
market although employment trends will decelerate into 2008. The slowing of
growth in the residential construction sector is acting as a drag on overall
employment growth which is forecast at 3% in 2007 and 1.5% in 2008. However the
economy is forecast to remain at, or close to, full employment with an
unemployment rate forecast of 4.75% for 2007 and 5.25% for 2008.
Retail sales rose 5.1% in August driven by sales of electrical goods,
clothing and footwear. Sales of home improvement materials rose 4.4% and
furniture sales, at 7.1%, showed a slight moderation from previous months. CBOI
is forecasting 7% growth in consumer spending in 2007 with a drop to 3.75% in
2008 due to the reduced impact of the SSIA accounts.
The annual Harmonized Index of Consumer Prices ("HCIP") rose 0.1% in
October resulting in an annual rise of 3.0%. Home heating oil and diesel rose
2.5% and 0.6%, respectively, over the month while a rise in food prices of 1.4%
offset a fall in clothing/footwear of 0.6%. HCIP forecasts are for 2.8% in 2007
slowing to 2.25% in 2008.
Annual private sector credit growth declined to 19.5% in September, down
from 20.1% in August. Demand for non-mortgage credit also declined with an
annual adjusted rate of 24.5% recorded in September, down from 25% in August. As
expected the annual rate of increase in residential mortgages continued its
downward trend declining to 16.1% between August and September.
EQUITY MARKET REVIEW
World stock markets posted a mixed performance during the quarter:
TWELVE MONTHS ENDED QUARTER ENDED
OCTOBER 31ST, 2007 OCTOBER 31ST, 2007
------------------- ------------------
LOCAL LOCAL
CURRENCY U.S. $ CURRENCY U.S. $
-------- -------- -------- ------
Irish Equities (ISEQ) -8.24% 3.94% -7.62% -2.41%
S&P 500 12.44% 12.44% 6.47% 6.47%
NASDAQ 20.81% 20.81% 12.29% 12.29%
UK Equities (FTSE 100) 9.67% 19.48% 5.68% 7.91%
Japanese Equities 0.16% 1.49% -5.05% -1.72%
Dow Jones Eurostoxx 50 13.93% 29.06% 3.36% 9.19%
German Equities (DAX) 27.92% 44.90% 5.74% 11.70%
French Equities (CAC 40) 9.33% 23.85% 1.68% 7.42%
Dutch Equities (AEX) 12.59% 27.54% 2.60% 8.38%
3
A number of the Fund's holdings released results or trading statements
during the most recent quarter, with highlights as follows:
CRH PLC reported strong interim results with operating profits increasing
26% to (euro) 771m. The group's European businesses posted a 50% increase in
profits driven by exceptional growth in Poland and the Ukraine. This compensated
for a weaker outturn in the Group's North American units, which registered a 2%
profit decline. Earnings per Share ("EPS") forecasts for fiscal year 2007 were
upgraded by 4-5% post these figures. CRH derated markedly in the period as
investor concern with regard to the outlook for construction markets, in
general, increased but it is felt that the Group remains excellent value at
current levels.
KINGSPAN GROUP PLC again posted a strong set of interim figures with sales
and trading profits ahead 34% and 30% respectively. Demand for their major
product - insulation panels - continues to be very robust across Europe with
Central & Eastern Europe showing underlying growth of 40% in the period. The
Group reiterated prior guidance of at least a 20% increase in operating profits
for 2007.
RYANAIR HOLDINGS PLC was a strong performer in the quarter as profit
guidance that was given following the announcement of the Company's full year
results in May, began to look increasingly conservative. Yield trends are
improving as overall capacity remains constrained in the European short haul
market while demand has remained robust despite increased airport charges on
passengers in the U,K.. Over the quarter, the Company also completed the stock
repurchase of a majority of the planned (euro) 300 million buyback.
GRAFTON GROUP PLC was a poor performer during the quarter despite the
release of strong interim results. Revenue and adjusted earnings were ahead 13%
and 18% in the first half. However investor focus during the period was
concentrated on a more difficult outlook for the Group's Irish merchanting
business given the expected decline in housing completions in 2008 and a more
difficult trading environment for the Group's U.K. businesses given recent
interest rate increases.
ICON PLC was an excellent performer during the period and reported strong
Q3 results. Revenue and diluted EPS increased by 38% and 40% respectively over
the prior year period. A strong book to bill ratio of 1.4x gave the group scope
to raise EPS guidance for 2007 to between $1.82 and $1.85 indicating profit
growth of 38% for 2007. Icon continues to benefit from R&D outsourcing trends in
the pharmaceutical industry.
4
CURRENT OUTLOOK
Despite the significant slowdown in the residential housing market, GDP
growth should remain reasonably strong based on the CBOI forecasts of 4.75% and
3.5% for 2007 and 2008, respectively. From an International perspective, recent
credit concerns have clouded the picture but, on balance, it is believed that
the environment remains positive. The ISEQ now trades on a multi-year low of
11.7x 2007 earnings and yields 2.5% with earnings growth of 16.6% forecast for
this year and 11.9% for 2008. This compares favorably with other European
markets that trade on higher multiples and where earnings are forecast to grow
at a rate of approximately 10%.
Sincerely,
/s/ [signature]
Chairman
December 21, 2007
5
INVESTMENT SUMMARY (UNAUDITED)
TOTAL RETURN (%)
MARKET VALUE NET ASSET VALUE (a)
-------------------- --------------------
AVERAGE AVERAGE
CUMULATIVE ANNUAL CUMULATIVE ANNUAL
---------- ------- ---------- -------
One Year 2.17 2.17 2.88 2.88
Three Year 85.61 22.90 76.48 20.85
Five Year 297.57 31.79 233.68 27.25
Ten Year 239.76 13.01 186.09 11.08
PER SHARE INFORMATION AND RETURNS
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
------------------------------------------------------------------------------------------------------
Net Asset
Value ($) 21.36 19.75 20.06 13.28 11.04 16.29 20.74 24.36 32.55 30.95
Income
Dividends ($) (0.07) -- (0.13) (0.01) (0.03) -- (0.09) (0.03) (0.16) (0.24)
Capital Gains
Other
Distributions ($) (0.70) (1.14) (1.60) (2.65) (0.69) -- -- -- (1.77) (2.40)
Restated Total
Return (%) (a)(b) 11.68 (2.37) 12.86 (20.99) (11.44) 47.55 28.14 17.51 45.97 2.88
NOTES
(a) Total investment returns reflect changes in net asset value per share
during each period and assume that dividends and capital gains
distributions, if any, were reinvested. These percentages are not an
indication of the performance of a shareholder's investment in the Fund
based on market price.
(b) The Net Asset Value total return information set forth in the "Per Share
Information and Returns" table for 2002 and prior years, that appeared in
the Annual Report for 2003 and the Semi-Annual Report and the Annual
Report for each of 2004, 2005 and 2006 was calculated using the NAV
reinvestment prices rather than the market reinvestment prices. In order
to be consistent all historic returns should have been calculated using
market reinvestment prices. The information that appeared was 2002 -
(12.07)%; 2001 - (23.76)%; 2000 - 13.27%; 1999 - (2.79)% and 1998 -
11.68%. The years of 1998 to 2002 have been restated to be consistent with
the methodology used beginning in 2003 to calculate the total returns. The
Net Asset Value total return information that appears in the table was
calculated using market reinvestment prices.
PAST RESULTS ARE NOT NECESSARILY INDICATIVE OF FUTURE PERFORMANCE OF THE FUND.
6
PORTFOLIO BY MARKET SECTOR AS OF OCTOBER 31, 2007
(PERCENTAGE OF NET ASSETS)
[THE FOLLOWING TABLE WAS REPRESENTED BY A PIE CHART IN THE PRINTED MATERIAL.]
Food and Agriculture 6.23%
Technology 3.28%
Construction and Building Materials 28.52%
Financial 17.41%
Food and Beverages 8.87%
Publishing and News 2.30%
Other Assets 9.11%
Transportation 9.40%
Business Services 5.19%
Health Care Services 4.16%
Diversified Financial Services 5.53%
TOP 10 HOLDINGS BY ISSUER AS OF OCTOBER 31, 2007
HOLDING SECTOR % OF NET ASSETS
------- ------ ---------------
CRH PLC Construction and Building Materials 15.97%
Allied Irish Banks PLC Financial 14.64%
Ryanair Holdings PLC Transportation 7.42%
IAWS Group PLC Food and Agriculture 6.23%
Kingspan Group PLC Construction and Building Materials 5.93%
Kerry Group PLC, Series A Food and Beverages 5.43%
Grafton Group PLC-UTS Construction and Building Materials 4.81%
DCC PLC Business Services 3.81%
FBD Holdings PLC Diversified Financial Services 3.26%
Irish Life & Permanent PLC Financial 2.77%
7
THE NEW IRELAND FUND, INC.
PORTFOLIO HOLDINGS
--------------------------------------------------------------------------------
Value (U.S.)
October 31, 2007 Shares (Note A)
--------------------------------------------------------------------------------
COMMON STOCKS (97.71%)
COMMON STOCKS OF IRISH COMPANIES (96.84%)
AGRICULTURAL OPERATIONS (1.56%)
Origin Enterprises PLC (a)* 428,163 $ 2,267,182
------------
BUSINESS SERVICES (5.19%)
CPL Resources PLC 200,982 1,701,019
DCC PLC 202,501 5,560,573
Newcourt Group PLC* 155,655 301,762
------------
7,563,354
------------
BUSINESS SUPPORT SERVICES (1.35%)
Veris PLC* 500,000 1,967,592
------------
COMPUTER SOFTWARE AND SERVICES (0.47%)
IONA Technologies PLC-ADR* 169,300 687,358
------------
CONSTRUCTION AND BUILDING MATERIALS (28.52%)
CRH PLC 610,929 23,281,058
Grafton Group PLC-UTS 630,458 7,014,209
Kingspan Group PLC 367,799 8,646,893
McInerney Holdings PLC 1,255,467 2,633,719
------------
41,575,879
------------
DIVERSIFIED FINANCIAL SERVICES (5.53%)
Boundary Capital PLC (a)* 635,534 616,042
FBD Holdings PLC 132,585 4,747,509
IFG Group PLC 556,276 1,464,731
TVC Holdings PLC (a)* 815,973 1,239,542
------------
8,067,824
------------
FINANCIAL (17.41%)
Allied Irish Banks PLC 855,747 21,344,149
Irish Life & Permanent PLC 178,245 4,034,752
------------
25,378,901
------------
FOOD & AGRICULTURE (6.23%)
IAWS Group PLC 386,346 9,082,930
------------
8
THE NEW IRELAND FUND, INC.
PORTFOLIO HOLDINGS (CONTINUED)
--------------------------------------------------------------------------------
Value (U.S.)
October 31, 2007 Shares (Note A)
--------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
COMMON STOCKS OF IRISH COMPANIES (CONTINUED)
FOOD AND BEVERAGES (8.87%)
C&C Group PLC 460,018 $ 3,673,754
Fyffes PLC 552,258 759,035
Kerry Group PLC, Series A 264,601 7,914,294
Total Produce PLC 552,258 579,264
------------
12,926,347
------------
FOREST PRODUCTS & PAPER (2.09%)
Smurfit Kappa Group PLC (a)* 151,515 3,044,767
------------
HEALTH CARE SERVICES (4.16%)
ICON PLC-Sponsored ADR* 53,947 3,128,926
United Drug PLC 587,476 2,932,280
------------
6,061,206
------------
PUBLISHING AND NEWS (2.30%)
Independent News & Media PLC 916,258 3,353,780
------------
REAL ESTATE DEVELOPMENT (0.10%)
Blackrock International Land PLC* 218,009 138,779
------------
TECHNOLOGY (3.28%)
Horizon Technology Group PLC* 1,321,900 1,874,221
Norkom Group PLC (a)* 364,481 896,438
Norkom Group PLC* 818,699 2,013,582
------------
4,784,241
------------
TELECOMMUNICATIONS (0.38%)
Zamano PLC* 1,100,000 557,002
------------
9
THE NEW IRELAND FUND, INC.
PORTFOLIO HOLDINGS (CONTINUED)
--------------------------------------------------------------------------------
Value (U.S.)
October 31, 2007 Shares (Note A)
--------------------------------------------------------------------------------
TRANSPORTATION (9.40%)
Aer Lingus Group PLC (a)* 249,183 $ 858,008
Ryanair Holdings PLC* 1,300,000 10,814,524
Ryanair Holdings PLC-Sponsored ADR* 41,285 2,030,809
------------
13,703,341
------------
TOTAL COMMON STOCKS OF IRISH COMPANIES
(Cost $72,342,033) 141,160,483
------------
COMMON STOCKS OF UNITED KINGDOM COMPANIES (0.87%)
(Cost U.S. $575,774)
CONSULTING SERVICES (0.87%)
RPS Group PLC 156,570 1,266,858
------------
TOTAL COMMON STOCKS BEFORE FOREIGN CURRENCY ON DEPOSIT
(Cost $72,917,807)
$142,427,341
------------
Face
Value
FOREIGN CURRENCY ON DEPOSIT (0.05%)
British Pounds Sterling (pound) 2,447 $ 5,082
Euro (euro) 42,393 61,333
------------
TOTAL FOREIGN CURRENCY ON DEPOSIT
(Cost $66,005)** 66,415
------------
TOTAL INVESTMENTS (97.76%)
(Cost $72,983,812) 142,493,756
OTHER ASSETS AND LIABILITIES (2.24%) 3,270,968
------------
NET ASSETS (100.00%)
$145,764,724
============
--------------------------------------------------------------------------------
(a) Securities exempt from registration pursuant to Rule 144A under the
Securities Act of 1933, as amended. These securities may only be resold,
in transactions exempt from registration, to qualified institutional
buyers. At October 31, 2007, these securities amounted to $8,921,979 or
6.12% of net assets.
* Non-income producing security.
** Foreign currency held on deposit at JPMorgan Chase & Co.
ADR - American Depositary Receipt traded in U.S. dollars.
UTS - Units
10
THE NEW IRELAND FUND, INC.
STATEMENT OF ASSETS AND LIABILITIES
--------------------------------------------------------------------------------
October 31, 2007
--------------------------------------------------------------------------------
ASSETS:
Investments at value (Cost $72,917,807)
See accompanying schedule U.S. $ 142,427,341
Cash 3,052,242
Foreign currency (Cost $66,005) 66,415
Dividends receivable 389,139
Prepaid expenses 56,534
-------------
Total Assets 145,991,671
-------------
LIABILITIES:
Investment advisory fee payable (Note B) 83,159
Accrued audit fees payable 35,000
Printing fees payable 30,994
Accrued legal fees payable 25,240
Administration fee payable (Note B) 18,570
Directors' fees and expenses (Note C) 17,624
Accrued expenses and other payables 9,894
Custodian fees payable (Note B) 5,716
Transfer agent fees payable 750
-------------
Total Liabilities 226,947
-------------
NET ASSETS U.S. $ 145,764,724
=============
AT OCTOBER 31, 2007 NET ASSETS CONSISTED OF:
Common Stock, U.S. $.01 Par Value -
Authorized 20,000,000 Shares
Issued and Outstanding 4,709,513 Shares U.S. $ 47,095
Additional Paid-in Capital 51,601,704
Undistributed Net Investment Income 1,705,049
Accumulated Net Realized Gain 22,886,807
Net Unrealized Appreciation of Securities,
Foreign Currency and Net Other Assets 69,524,069
-------------
TOTAL NET ASSETS U.S. $ 145,764,724
=============
NET ASSET VALUE PER SHARE
(Applicable to 4,709,513 outstanding shares)
(authorized 20,000,000 shares)
(U.S. $145,764,724 / 4,709,513) U.S. $ 30.95
=============
See Notes to Financial Statements.
11
THE NEW IRELAND FUND, INC.
STATEMENT OF OPERATIONS
---------------------------------------------------------------------------------------------------
For the Year Ended
October 31, 2007
---------------------------------------------------------------------------------------------------
INVESTMENT INCOME
Dividends U.S. $ 3,681,694
Interest 34,159
--------------
TOTAL INVESTMENT INCOME 3,715,853
--------------
EXPENSES
Investment advisory fee (Note B) $ 1,048,665
Administration fee (Note B) 272,114
Directors' fees and expenses (Note C) 215,745
Audit fees 37,804
Compliance fees 62,893
Legal fees 103,289
Printing fees 74,318
Custodian fees (Note B) 67,634
Other 203,077
-------------
TOTAL EXPENSES 2,085,539
--------------
NET INVESTMENT INCOME U.S. $ 1,630,314
--------------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS (NOTE E)
Realized gain on:
Securities transactions 22,903,469
Foreign currency transactions 74,735
-------------
Net realized gain on investments during the year 22,978,204
--------------
Net change in unrealized appreciation (depreciation) of:
Securities (20,220,349)
Foreign currency and net other assets 5,821
-------------
Net unrealized depreciation of investments during the year (20,214,528)
--------------
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS 2,763,676
--------------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS U.S. $ 4,393,990
==============
See Notes to Financial Statements.
12
THE NEW IRELAND FUND, INC.
STATEMENT OF CHANGES IN NET ASSETS
-----------------------------------------------------------------------------------------------------
Year Ended Year Ended
October 31, 2007 October 31, 2006
-----------------------------------------------------------------------------------------------------
Net investment income U.S. $ 1,630,314 U.S. $ 1,076,882
Net realized gain on investments 22,978,204 11,161,156
Net unrealized appreciation/(depreciation)
of investments, foreign currency holdings
and net other assets (20,214,528) 35,088,838
---------------- ----------------
Net increase in net assets resulting from
operations 4,393,990 47,326,876
---------------- ----------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (1,113,999) (722,941)
Net realized gains (11,139,986) (7,997,529)
---------------- ----------------
Total distributions (12,253,985) (8,720,470)
---------------- ----------------
CAPITAL SHARE TRANSACTIONS:
Value of 125,300 and 60,950 shares
repurchased, respectively (Note G) (3,696,735) (1,460,049)
Value of shares issued to shareholders in
connection with a stock distribution (Note F) 6,219,513 3,766,311
---------------- ----------------
NET INCREASE IN NET ASSETS
RESULTING FROM CAPITAL SHARE
TRANSACTIONS 2,522,778 2,306,262
---------------- ----------------
Total increase/(decrease) in net assets (5,337,217) 40,912,668
---------------- ----------------
NET ASSETS
Beginning of year 151,101,941 110,189,273
---------------- ----------------
End of year (Including undistributed
net investment income of $1,705,049
and $1,127,060, respectively) U.S. $ 145,764,724 U.S. $ 151,101,941
================ ================
See Notes to Financial Statements.
13
THE NEW IRELAND FUND, INC.
FINANCIAL HIGHLIGHTS (FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH YEAR)
--------------------------------------------------------------------------------
Year Ended October 31,
---------------------------------------------------------------
2007 2006 2005 2004 2003
-------------------------------------------------------------------------------------------------------------------------
Operating Performance:
Net Asset Value,
Beginning of Year U.S. $ 32.55 $ 24.36 $ 20.74 $ 16.29 $ 11.04
--------- --------- --------- -------- --------
Net Investment Income/(Loss) 0.35 0.23 0.16 (0.00)# 0.07
Net Realized and Unrealized
Gain/(Loss) on Investments 0.69 9.98 3.38 4.49 5.08
--------- --------- --------- -------- --------
Net Increase/(Decrease) in
Net Assets Resulting from
Investment Operations 1.04 10.21 3.54 4.49 5.15
--------- --------- --------- -------- --------
Distributions to Shareholders from:
Net Investment Income (0.24) (0.16) (0.03) (0.09) --
Net Realized Gains (2.40) (1.77) -- -- --
--------- --------- --------- -------- --------
Total from Distributions (2.64) (1.93) (0.03) (0.09) --
--------- --------- --------- -------- --------
Anti-Dilutive/(Dilutive) Impact
of Capital Share Transactions 0.00++ (0.09)+ 0.11 0.05 0.10
--------- --------- --------- -------- --------
Net Asset Value,
End of Period U.S. $ 30.95 $ 32.55 $ 24.36 $ 20.74 $ 16.29
========= ========= ========= ======== ========
Share Price, End of Period U.S. $ 28.96 $ 30.67 $ 21.95 $ 18.46 $ 13.81
========= ========= ========= ======== ========
Total NAV Investment Return (a) 2.88% 45.97% 17.51% 28.14% 47.55%
========= ========= ========= ======== ========
Total Market Investment
Return (b) 2.17% 52.47% 19.07% 34.47% 59.28%
========= ========= ========= ======== ========
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA:
Net Assets,
End of Year (000's) U.S. $ 145,765 $ 151,102 $ 110,189 $ 97,253 $ 77,790
Ratio of Net Investment
Income/(Loss) to Average
Net Assets 1.02% 0.86% 0.66% (0.00)%++ 0.54%
Ratio of Operating Expenses
to Average Net Assets 1.31% 1.40% 1.34% 1.80% 1.78%
Portfolio Turnover Rate 13% 11% 13% 5% 10%
(a) Based on share net asset value and reinvestment of distribution at the
price obtained under the Dividend Reinvestment and Cash Purchase Plan.
(b) Based on share market price and reinvestment of distributions at the price
obtained under the Dividend Reinvestment and Cash Purchase Plan.
+ Amount represents $0.03 per share impact for shares repurchased by the
Fund under the Share Repurchase Program and $0.12 per share impact for the
new shares issued as Capital Gain Stock Distribution.
++ Amount represents $0.07 per share impact for shares repurchased by the
Fund under the Share Repurchase Program and $0.07 per share impact for the
new shares issued as Capital Gain Stock Distribution.
# Amount represents less than $0.01 per share.
++ Amount represents less than 0.01%.
14
THE NEW IRELAND FUND, INC.
NOTES TO FINANCIAL STATEMENTS
--------------------------------------------------------------------------------
The New Ireland Fund, Inc. (the "Fund") was incorporated under the laws of
the State of Maryland on December 14, 1989 and is registered as a
non-diversified, closed-end management investment company under the Investment
Company Act of 1940, as amended (the "1940 Act"). The Fund's investment
objective is long-term capital appreciation through investment primarily in
equity securities of Irish Companies. The Fund is designed for U.S. and other
investors who wish to participate in the Irish securities markets. In order to
take advantage of significant changes that have occurred in the Irish economy
and to advance the Fund's investment objective, the investment strategy now has
a bias towards Ireland's growth companies.
Under normal circumstances, the Fund will invest at least 80% of its total
assets in equity and fixed income securities of Irish companies. To the extent
that the balance of the Fund's assets is not so invested, it will have the
flexibility to invest the remaining assets in non-Irish companies that are
listed on a recognized stock exchange. The Fund may invest up to 25% of its
assets in equity securities that are not listed on any securities exchange.
A. SIGNIFICANT ACCOUNTING POLICIES:
The preparation of financial statements in accordance with accounting
principles generally accepted in the United States of America requires
management to make estimates and assumptions that affect the reported amounts
and disclosures in the financial statements. Actual results could differ from
those estimates. The following is a summary of significant accounting policies
consistently followed by the Fund in the preparation of its financial
statements.
SECURITY VALUATION: Securities listed on a stock exchange for which market
quotations are readily available are valued at the closing prices on the date of
valuation, or if no such closing prices are available, at the last bid price
quoted on such day. If there are no such quotations available for the date of
valuation, the last available closing price will be used. The value of
securities and other assets for which no market quotations are readily
available, or whose values have been materially affected by events occurring
before the Funds' pricing time but after the close of the securities' primary
markets, are valued by methods deemed by the Board of Directors to represent
fair value. Short-term securities that mature in 60 days or less are valued at
amortized cost.
DIVIDENDS AND DISTRIBUTIONS TO STOCKHOLDERS: Distributions are determined
on a tax basis and may differ from net investment income and realized capital
gains for financial reporting purposes. Differences may be permanent or
temporary. Permanent differences are reclassified among capital accounts in the
financial statements to reflect their tax character. Temporary differences arise
when certain items of income, expense, gain or loss are recognized in different
periods for financial statement and tax purposes; these differences will reverse
at some point in the future. Differences in classification may also result from
the treatment of short-term gain as ordinary income for tax purposes.
For tax purposes, at October 31, 2007 and October 31, 2006, the Fund
distributed $1,253,249 and $734,293, respectively, of ordinary income. The Fund
also distributed, for tax purposes at October 31, 2007 and October 31, 2006,
$11,000,736 and $7,986,177, respectively of long-term capital gains.
During the year ended October 31, 2007, the Fund realized net foreign
currency gains of $74,735, which increased distributable net income for tax
purposes; accordingly such gains have been reclassified to undistributed net
investment income from accumulated net realized gains.
15
THE NEW IRELAND FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
--------------------------------------------------------------------------------
U.S. FEDERAL INCOME TAXES: It is the Fund's intention to continue to
qualify as a regulated investment company under Subchapter M of the Internal
Revenue Code of 1986, as amended, and distribute all of its taxable income
within the prescribed time. It is also the intention of the Fund to make
distributions in sufficient amounts to avoid Fund excise tax. Accordingly, no
provision for U.S. Federal income taxes is required.
CURRENCY TRANSLATION: The books and records of the Fund are maintained in
U.S. dollars. Foreign currency amounts are translated into U.S. dollars at the
spot rate of such currencies against U.S. dollars by obtaining from FT-IDC each
day the current 4:00pm London time spot rate and future rate (the future rates
are quoted in 30-day increments) on foreign currency contracts. Net realized
foreign currency gains and losses resulting from changes in exchange rates
include foreign currency gains and losses between trade date and settlement date
on investment securities transactions, foreign currency transactions and the
difference between the amounts of interest and dividends recorded on the books
of the Fund and the amount actually received. The portion of foreign currency
gains and losses related to fluctuation in exchange rates between the initial
purchase trade date and subsequent sale trade date is included in realized gains
and losses on security transactions.
FORWARD FOREIGN CURRENCY CONTRACTS: The Fund may enter into forward
foreign currency contracts for non-trading purposes in order to protect
investment securities and related receivables and payables against future
changes in foreign currency exchange rates. Fluctuations in the value of such
contracts are recorded as unrealized gains or losses; realized gains or losses
include net gains or losses on contracts which have terminated by settlements or
by entering into offsetting commitments. Risks associated with such contracts
include movement in the value of the foreign currency relative to the U.S.
dollar and the ability of the counterparty to perform. There were no such
contracts open in the Fund as of October 31, 2007.
SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities transactions are
recorded as of the trade date. Realized gains and losses from securities sold
are recorded on the identified cost basis. Dividend income is recorded on the
ex-dividend date except that certain dividends from foreign securities are
recorded as soon as the Fund is informed of the ex-dividend date. Non-cash
dividends, if any, are recorded at the fair market value of the securities
received. Interest income is recorded on the accrual basis.
USE OF ESTIMATES: The preparation of financial statements in conformity
with U.S. generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Accrual results could differ from those estimates.
NEW ACCOUNTING PRONOUNCEMENTS: In July 2006, the Financial Accounting
Standards Board (FASB) issued FASB Interpretation No. 48 "Accounting for
Uncertainty in Income Taxes" ("FIN 48"). This pronouncement provides guidance on
the recognition, measurement, classification, and disclosures related to
uncertain tax positions, along with any related interest and penalties. FIN 48
is effective for fiscal years beginning after December 15, 2006. The impact from
the adoption of FIN 48 is being evaluated, but is not anticipated to have a
material effect on the financial statements.
In addition, in September 2006, Statement of Financial Accounting
Standards No. 157 Fair Value Measurements ("SFAS 157") was issued and is
effective for fiscal years beginning after November 15, 2007. SFAS 157 defines
fair value, establishes a
16
THE NEW IRELAND FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
--------------------------------------------------------------------------------
framework for measuring fair value and expands disclosures about fair value
measurements.
Also, in February 2007, FASB issued Statement of Financial Accounting
Standards No. 159, The Fair Value Option for Financial Assets and Financial
Liabilities ("SFAS 159"), which provides companies with an option to report
selected financial assets and liabilities at fair value. The objective of SFAS
159 is to reduce both complexity in accounting for financial instruments and the
volatility in earnings caused by measuring related assets and liabilities
differently. SFAS 159 establishes presentation and disclosure requirements
designed to facilitate comparisons between companies that choose different
measurement attributes for similar types of assets and liabilities and to more
easily understand the effect of the Funds' choice to use fair value on their
earnings. SFAS 159 also requires entities to display the fair value of the
selected assets and liabilities on the face of the balance sheet. SFAS 159 does
not eliminate disclosure requirements of other accounting standards, including
fair value measurement disclosures in SFAS 157. SFAS 159 is effective for fiscal
years beginning after November 15, 2007.
At this time, management is evaluating the implications SFAS 157 and SFAS
159 and their impact on the Funds' financial statements, if any, has not been
determined.
B. MANAGEMENT SERVICES:
The Fund has entered into an investment advisory agreement (the
"Investment Advisory Agreement") with Bank of Ireland Asset Management (U.S.)
Limited ("Bank of Ireland Asset Management"), an indirect wholly-owned
subsidiary of The Governor and Company of the Bank of Ireland ("Bank of
Ireland"). Under the Investment Advisory Agreement, the Fund pays a monthly fee
at an annualized rate equal to 0.75% of the value of the average daily net
assets of the Fund up to the first $100 million and 0.50% of the value of the
average daily net assets of the Fund on amounts in excess of $100 million. In
addition, Bank of Ireland Asset Management provides investor services to
existing and potential shareholders.
The Fund has entered into an administration agreement (the "Administration
Agreement") with PFPC Inc. The Fund pays PFPC Inc. an annual fee payable
monthly.
The Fund has entered into an agreement with JPMorgan Chase & Co. to serve
as custodian of the Fund's assets.
C. DIRECTORS FEES:
The Fund currently pays each Director who is not a managing director,
officer or employee of Bank of Ireland Asset Management or any affiliate
thereof, an annual retainer of U.S. $16,000, plus U.S. $2,000 for each meeting
of the Board of Directors attended in person or via telephone and any
shareholder meeting attended in person not held on the same day as a meeting of
the Board. A fee of U.S. $1,500 is paid for each meeting of a Committee of the
Board attended in person or via telephone. The Fund pays the Chairman of the
Board of Directors of the Fund an additional annual fee of U.S. $35,000. Also,
the Fund pays the Chairperson of the Audit Committee an additional U.S. $3,000
for each meeting of the Audit Committee attended. Each Director is reimbursed
for travel and certain out-of-pocket expenses.
D. PURCHASES AND SALES OF SECURITIES:
The cost of purchases and proceeds from sales of securities for the year
ended October 31, 2007, excluding U.S. government and short-term investments,
aggregated U.S. $21,100,214 and U.S. $30,710,155, respectively.
17
THE NEW IRELAND FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
--------------------------------------------------------------------------------
E. COMPONENTS OF DISTRIBUTABLE EARNINGS:
As of October 31, 2007, the components of distributable earnings on a tax
basis were as follows:
Undistributed Accumulated
Ordinary Long-Term Net Unrealized
Income Gains Appreciation
------------- ------------ -------------
$ 2,655,292 $ 21,936,564 $ 69,524,069
The aggregate cost of investments and the composition of unrealized appreciation
and depreciation on investments and appreciation on assets and liabilities in
foreign currencies on a tax basis as of October 31, 2007 were as follows:
Gross
Gross Gross Unrealized
Unrealized Unrealized Net Unrealized Appreciation Net
Total Cost of Appreciation Depreciation Appreciation on Foreign Unrealized
Investments on Investments on Investments on Investments Currency Appreciation
------------- -------------- -------------- -------------- ------------ ------------
$ 72,917,807 $ 73,538,570 $ (4,029,036) $ 69,509,534 $ 14,535 $ 69,524,069
There were no permanent tax and book differences in gross appreciation/
depreciation of securities or the cost basis of securities.
F. COMMON STOCK:
For the year ended October 31, 2007, the Fund issued 193,152 shares in
connection with stock distribution in the amount of $6,219,513.
G. SHARE REPURCHASE PROGRAM:
In accordance with Section 23(c) of the Investment Company Act of 1940, as
amended, the Fund hereby gives notice that it may from time to time repurchase
shares of the Fund in the open market at the option of the Board of Directors
and upon such terms as the Directors shall determine.
For the year ended October 31, 2007, the Fund repurchased 125,300 (2.70%
of the shares outstanding at October 31, 2006 year end) of its shares for a
total cost of $3,696,735, at an average discount of 8.79% of net asset value.
For the year ended October 31, 2006, the Fund repurchased 60,950 (1.31% of
the shares outstanding at October 31, 2005 year end) of its shares for a total
cost of $1,460,049, at an average discount of 9.85% of net asset value.
H. MARKET CONCENTRATION:
Because the Fund concentrates its investments in securities issued by
corporations in Ireland, its portfolio may be subject to special risks and
considerations typically not associated with investing in a broader range of
domestic securities. In addition, the Fund is more susceptible to factors
adversely affecting the Irish economy than a comparable fund not concentrated in
these issuers to the same extent.
I. SUBSEQUENT EVENT:
On November 8, 2007, the Fund declared a stock distribution of $5.22 per
share, which represents a distribution from net investment income of $0.36 and
realized capital gains of $4.86, being $0.20 short-term capital gains and $4.66
long-term capital gains, to shareholders of record November 16, 2007, payable
December 28, 2007.
18
THE NEW IRELAND FUND, INC.
REPORT OF INDEPENDENT PUBLIC REGISTERED ACCOUNTING FIRM
--------------------------------------------------------------------------------
To the Board of Directors and Shareholders of
THE NEW IRELAND FUND, INC.:
We have audited the accompanying statement of assets and liabilities of
The New Ireland Fund, Inc. (the "Fund"), including the portfolio holdings, as of
October 31, 2007, and the related statement of operations, the statement of
changes in net assets and the financial highlights for the year then ended.
These financial statements and financial highlights are the responsibility of
the Fund's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audit. The statement
of changes in net assets for the year ended October 31, 2006 and the financial
highlights for each of the four years in the period ended October 31, 2006 have
been audited by other auditors, whose report dated December 5, 2006 expressed an
unqualified opinion on such financial statement and financial highlights.
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.
The Fund is not required to have, nor were we engaged to perform, an audit of
its internal control over financial reporting. Our audit included consideration
of internal control over financial reporting as a basis for designing audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Fund's internal control over
financial reporting. Accordingly, we express no such opinion. An audit also
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, as well as evaluating the
overall financial statement presentation. Our procedures included confirmation
of securities owned as of October 31, 2007, by correspondence with the
custodian. 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 The
New Ireland Fund, Inc., as of October 31, 2007, and the results of its
operations, the changes in its net assets and the financial highlights for the
year then ended, in conformity with accounting principles generally accepted in
the United States of America.
TAIT, WELLER & BAKER LLP
Philadelphia, Pennsylvania
December 5, 2007
19
ADDITIONAL INFORMATION
--------------------------------------------------------------------------------
DIVIDEND REINVESTMENT AND CASH PURCHASE PLAN
The Fund will distribute to shareholders, at least annually, substantially
all of its net income from dividends and interest payments and expects to
distribute substantially all its net realized capital gains annually. Pursuant
to the Dividend Reinvestment and Cash Purchase Plan (the "Plan") approved by the
Fund's Board of Directors (the "Directors"), each shareholder will be deemed to
have elected, unless American Stock Transfer & Trust Company (the "Plan Agent")
is instructed otherwise by the shareholder in writing, to have all distributions
automatically reinvested by the Plan Agent in Fund shares pursuant to the Plan.
Distributions with respect to Fund shares registered in the name of a
broker-dealer or other nominee (i.e., in "street name") will be reinvested by
the broker or nominee in additional Fund shares under the Plan, unless the
service is not provided by the broker or nominee or the shareholder elects to
receive distributions in cash. Investors who own Fund shares registered in
street names may not be able to transfer those shares to another broker-dealer
and continue to participate in the Plan. These shareholders should consult their
broker-dealer for details. Shareholders who do not participate in the Plan will
receive all distributions in cash paid by check in U.S. dollars mailed directly
to the shareholder by the Plan Agent, as paying agent. Shareholders who do not
wish to have distributions automatically reinvested should notify the Fund, in
care of the Plan Agent for The New Ireland Fund, Inc.
The Plan Agent will serve as agent for the shareholders in administering
the Plan. If the Directors of the Fund declare an income dividend or a capital
gains distribution payable either in the Fund's common stock or in cash, as
shareholders may have elected, non-participants in the Plan will receive cash
and participants in the Plan will receive common stock to be issued by the Fund.
If the market price per share on the valuation date equals or exceeds net asset
value per share on that date, the Fund will issue new shares to participants at
net asset value or, if the net asset value is less than 95% of the market price
on the valuation date, then at 95% of the market price. The valuation date will
be the dividend or distribution payment date or, if that date is not a trading
day on the New York Stock Exchange, Inc. ("New York Stock Exchange"), the next
preceding trading day. If the net asset value exceeds the market price of Fund
shares at such time, participants in the Plan will be deemed to have elected to
receive shares of stock from the Fund, valued at market price on the valuation
date. If the Fund should declare a dividend or capital gains distribution
payable only in cash, the Plan Agent as agent for the participants, will buy
Fund shares in the open market, on the New York Stock Exchange or elsewhere,
with the cash in respect of such dividend or distribution, for the participants'
account on, or shortly after, the payment date.
Participants in the Plan have the option of making additional cash
payments to the Plan Agent, annually, in any amount from U.S. $100 to U.S.
$3,000, for investment in the Fund's common stock. The Plan Agent will use all
funds received from participants (as well as any dividends and capital gain
distributions received in cash) to purchase Fund shares in the open market on or
about January 15 of each year. Any voluntary cash payments received more than
thirty days prior to such date will be returned by the Plan Agent, and interest
will not be paid on any uninvested cash payments. To avoid unnecessary cash
accumulations and to allow ample time for receipt and processing by the Plan
Agent, it is suggested that the participants send in voluntary cash payments to
be received by the Plan Agent approximately ten days before January 15. A
participant may withdraw a voluntary cash payment by written notice, if the
notice is received by the Plan Agent not less than forty-eight hours before such
payment is to be invested.
20
ADDITIONAL INFORMATION (CONTINUED)
--------------------------------------------------------------------------------
The Plan Agent maintains all shareholder accounts in the Plan and
furnishes written confirmations of all transactions in the account, including
information needed by shareholders for personal and U.S. Federal tax records.
Shares in the account of each Plan participant will be held by the Plan Agent in
non-certificated form in the name of the participant, and each shareholder's
proxy will include those shares purchased pursuant to the Plan.
In the case of shareholders such as banks, brokers or nominees who hold
shares for beneficial owners, the Plan Agent will administer the Plan on the
basis of the number of shares certified from time to time by the shareholder as
representing the total amount registered in the shareholder's name and held for
the account of beneficial owners who are participating in the Plan.
There is no charge to participants for reinvesting dividends or capital
gains distributions. The Plan Agent's fee for the handling of the reinvestment
of dividends and distributions will be paid by the Fund. However, each
participant's account will be charged a pro rata share of brokerage commissions
incurred with respect to the Plan Agent's open market purchases in connection
with the reinvestment of dividends or capital gains distributions. A participant
will also pay brokerage commissions incurred in purchases in connection with the
reinvestment of dividends or capital gains distributions. A participant will
also pay brokerage commissions incurred in purchases from voluntary cash
payments made by the participant. Brokerage charges for purchasing small amounts
of stock of individual accounts through the Plan are expected to be less than
the usual brokerage charges for such transactions, because the Plan Agent will
be purchasing stock for all participants in blocks and prorating the lower
commission thus attainable.
The automatic reinvestment of dividends and distributions will not relieve
participants of any U.S. Federal income tax which may be payable on such
dividends or distributions.
Experience under the Plan may indicate that changes are desirable.
Accordingly, the Fund reserves the right to amend or terminate the Plan as
applied to any voluntary cash payment made and any dividend or distribution paid
subsequent to notice of the change sent to all shareholders at least ninety days
before the record date for such dividend or distribution. The Plan also may be
amended or terminated by the Plan Agent with at least ninety days written notice
to all shareholders. All correspondence concerning the Plan should be directed
to the Plan Agent for The New Ireland Fund, Inc. in care of American Stock
Transfer & Trust Company, 59 Maiden Lane, New York, New York, 10038, telephone
number (718) 921-8283.
21
ADDITIONAL INFORMATION (CONTINUED)
--------------------------------------------------------------------------------
MEETING OF SHAREHOLDERS
--------------------------------------------------------------------------------
On June 5, 2007, the Fund held its Annual Meeting of Shareholders. The
following Directors were elected by the following votes: Denis P. Kelleher
4,027,327 For; 83,645 Abstaining and David Dempsey 4,012,757 For; 98,215
Abstaining. Peter J. Hooper, Margaret Duffy, George G. Moore and Brendan Donohoe
continue to serve in their capacities as Directors of the Fund.
FUND'S PRIVACY POLICY
--------------------------------------------------------------------------------
The New Ireland Fund, Inc. appreciates the privacy concerns and
expectations of its registered shareholders and safeguarding their nonpublic
personal information ("Information") is of great importance to the Fund.
The Fund collects Information pertaining to its registered shareholders,
including matters such as name, address, tax I.D. number, Social Security number
and instructions regarding the Fund's Dividend Reinvestment Plan. The
Information is collected from the following sources:
o Directly from the registered shareholder through data provided on
applications or other forms and through account inquiries by mail,
telephone or e-mail.
o From the registered shareholder's broker as the shares are initially
transferred into registered form.
Except as permitted by law, the Fund does not disclose any Information
about its current or former registered shareholders to anyone. The disclosures
made by the Fund are primarily to the Fund's service providers as needed to
maintain account records and perform other services for the Fund's shareholders.
The Fund maintains physical, electronic, and procedural safeguards to protect
the shareholders' Information in the Fund's possession.
The Fund's privacy policy applies only to its individual registered
shareholders. If you own shares of the Fund through a third party broker, bank
or other financial institution, that institution's privacy policies will apply
to you and the Fund's privacy policy will not.
PORTFOLIO INFORMATION
--------------------------------------------------------------------------------
The Fund files its complete schedule of portfolio holdings with the
Securities and Exchange Commission ("SEC") for the first and third quarters of
each fiscal year on Form N-Q. The Fund's Form N-Q is available (1) by calling
1-800-468-6475; (2) on the Fund's website located at
http://www.newirelandfund.com; (3) on the SEC's website at http://www.sec.gov;
or (4) for review and copying at the SEC's Public Reference Room ("PRR") in
Washington, DC. Information regarding the operation of the PRR may be obtained
by calling 1-800-SEC-0330.
PROXY VOTING INFORMATION
--------------------------------------------------------------------------------
A description of the policies and procedures that the Fund uses to
determine how to vote proxies relating to portfolio securities held by the Fund
is available, without charge and upon request, by calling 1-800-468-6475. This
information is also available from the EDGAR database or the SEC's website at
http://www.sec.gov. Information regarding how the Fund voted proxies relating to
portfolio securities during the most recent twelve-month period ended June 30 is
available at http://www.sec.gov.
22
ADDITIONAL INFORMATION (CONTINUED)
--------------------------------------------------------------------------------
CERTIFICATIONS
--------------------------------------------------------------------------------
The Fund's president has certified to the New York Stock Exchange that, as
of June 18, 2007, he was not aware of any violation by the Fund of applicable
NYSE corporate governance listing standards. The Fund's reports to the SEC on
Forms N-CSR and N-CSRS contain certifications by the Fund's principal executive
officer and principal financial officer that relate to the Fund's disclosure in
such reports and that are required by rule 30a2(a) under the 1940 Act.
TAX INFORMATION
--------------------------------------------------------------------------------
For non-corporate shareholders 100%, or the maximum amount allowable under
the Jobs and Growth Tax Relief Reconciliation Act of 2003, of income earned by
the Fund for the period November 1, 2006 to October 31, 2007 may represent
qualified dividend income. Final information will be provided in your 2007 1099
Div Form.
For the fiscal year ended October 31, 2007, the Fund designated long-term
capital gains of $21,948,714.
23
BOARD OF DIRECTORS/OFFICERS
--------------------------------------------------------------------------------
TERM OF PRINCIPAL NUMBER OF
POSITION(S) OFFICE AND OCCUPATION(S) PORTFOLIOS IN
HELD WITH LENGTH AND OTHER FUND COMPLEX
NAME, ADDRESS, THE OF TIME DIRECTORSHIPS DURING OVERSEEN BY
AND AGE FUND SERVED* PAST FIVE YEARS DIRECTOR
------------------------------------------------------------------------------------------------------------
NON-INTERESTED DIRECTORS:
Peter J. Hooper, 67 Director and Since 1990 President of Hooper Associates- 1
Westchester Financial Chairman of Current Consultants (1994 to present);
Center, Suite 1000 the Board term Director, The Ireland United States
50 Main Street expires in Council for Commerce and Industry
White Plains, NY 10606 2009. (1984 to present); Director, Flax
Trust - America (1988 to 2007);
Director, Children's Medical
Research Foundation (1987 to 2004).
David Dempsey, 57 Director Since 2007 Managing Director, Bentley 1
360 Lexington Avenue Current Associates L.P., (1991 to present).
3rd Floor term
New York, NY 10017 expires in
2010.
Margaret Duffy, 63 Director Since 2006 Financial Consultant, Director, The 1
164 East 72 Street Current Dyson-Kissner-Moran Corporation
Suite 7B term (2000 to present); Director,
New York, NY 10021 expires in National Association of Women
2008. Artists, Inc. (2001 to present);
Director, Little Sisters of the
Assumption Family Health Service,
Inc. (2005 to present). Director,
The Ireland United States Council
for Commerce and Industry (1994 to
2005).
Denis P. Kelleher, 68 Director Since 1991 Chief Executive Officer, Wall Street 1
17 Battery Place Current Access-Financial Services (1981 to
New York, NY 10004 term present); Director, Independence
expires in Community Bank (1992 to 2006).
2010. Chairman and member of the Board of
Trustees, St. John's University
(1998 to 2007).
George G. Moore, 56 Director Since 2004 Chairman/Chief Executive Officer, 1
8010 Towers Crescent Current TARGUSinfo (1993 to present);
Drive term Chairman, AMACAI Information Corp.
Vienna, VA 22182 expires in (2001 to present).
2009.
-----------
* Each Director shall serve until the expiration of their current term and
until their successor is elected and qualified.
24
BOARD OF DIRECTORS/OFFICERS
--------------------------------------------------------------------------------
TERM OF PRINCIPAL NUMBER OF
POSITION(S) OFFICE AND OCCUPATION(S) PORTFOLIOS IN
HELD WITH LENGTH AND OTHER FUND COMPLEX
NAME, ADDRESS, THE OF TIME DIRECTORSHIPS DURING OVERSEEN BY
AND AGE FUND SERVED* PAST FIVE YEARS DIRECTOR
------------------------------------------------------------------------------------------------------------
INTERESTED DIRECTOR:
Brendan Donohoe, 48** Director and Since 2005 President, Bank of Ireland Asset 1
Bank of Ireland Asset President*** Current Management (U.S.) Limited (2005 to
Management (U.S.) term present); Director & Regional
Limited, expires in Director, Asia/Pacific, BIAM
300 First Stamford Place, 2008. Australia Pty Limited (2000 to
Stamford, CT 06902 2005); Director & Regional Director
Asia/Pacific, Bank of Ireland Asset
Management (Japan) Limited (2000 to
2005); Director, Iridian Asset
Management LLC (2005 to present).
OFFICERS***:
Brendan Donohoe see description above
Lelia Long, 45 Treasurer Since 2002 Senior Vice President & Director,
Bank of Ireland Asset Bank of Ireland Asset Management
Management (U.S.) (U.S.) Limited (1999 to present);
Limited, Director, Iridian Asset Management
300 First Stamford Place LLC (2002 to 2005).
Stamford, CT 06902
Salvatore Faia, 45 Chief Since 2005 President, Vigilant Compliance
Vigilant Compliance Compliance Services, (2004 to present);
186 Dundee Drive, Officer Trustee, Energy Income Partnership,
Suite 700 (2005 to present); Senior Legal
Williamstown, NJ 08094 Counsel, PFPC Inc. (2002 to 2004)
Colleen Cummings, 36 Assistant Since 2006 Vice President and Director, PFPC
4400 Computer Drive Treasurer Inc. (2004 to present); Manager,
Westborough, MA PFPC Inc. (1998 to 2004)
01580
Vincenzo A. Scarduzio, 35 Secretary Since 2005 Assistant Vice President, PFPC Inc.
760 Moore Road (2006 to Present); Senior Regulatory
King of Prussia, PA 19406 Administrator, PFPC Inc. (2001 to
2006).
-----------
* Each Director shall serve until the expiration of their current term and
until their successor is elected and qualified.
** Mr. Donohoe is deemed to be an "interested" Director because of his
affiliation with the Investment Adviser.
*** Each Officer of the Fund will hold office until a successor has been
elected by the Board of Directors.
25
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THE NEW IRELAND FUND, INC.
DIRECTORS AND OFFICERS
Peter J. Hooper - CHAIRMAN OF THE BOARD
Brendan Donohoe - PRESIDENT AND DIRECTOR
David Dempsey - DIRECTOR
Margaret Duffy - DIRECTOR
Denis P. Kelleher - DIRECTOR
George G. Moore - DIRECTOR
Lelia Long - TREASURER
Colleen Cummings - ASSISTANT TREASURER
Vincenzo Scarduzio - SECRETARY
Salvatore Faia - CHIEF COMPLIANCE OFFICER
PRINCIPAL INVESTMENT ADVISER
Bank of Ireland Asset Management (U.S.) Limited
300 First Stamford Place
Stamford, Connecticut 06902
ADMINISTRATOR
PFPC Inc.
4400 Computer Drive
Westborough, Massachusetts 01581
CUSTODIAN
JPMorgan Chase & Co.
North America Investment Services
3 Metro Tech - 7th Floor
Brooklyn, New York 11245
SHAREHOLDER SERVICING AGENT
American Stock Transfer & Trust Company
59 Maiden Lane
New York, New York 10038
LEGAL COUNSEL
Seward & Kissel LLP
One Battery Park Plaza
New York, New York 10004
INDEPENDENT PUBLIC REGISTERED ACCOUNTING FIRM
Tait Weller Baker LLP
1818 Market Street
Philadelphia, PA 19103
CORRESPONDENCE
ALL CORRESPONDENCE SHOULD BE ADDRESSED TO:
The New Ireland Fund, Inc.
c/o PFPC Inc.
99 High Street
27th Floor
Boston, Massachusetts 02110
TELEPHONE INQUIRIES SHOULD BE DIRECTED TO:
1-800-GO-TO-IRL (1-800-468-6475)
WEBSITE ADDRESS:
www.newirelandfund.com
--------------------------------------------------------------------------------
IR-AN 10/07
ITEM 2. CODE OF ETHICS.
(a) The registrant, as of the end of the period covered by this report, has
adopted a code of ethics that applies to the registrant's principal
executive officer, principal financial officer, principal accounting
officer or controller, or persons performing similar functions,
regardless of whether these individuals are employed by the registrant
or a third party.
(c) There have been no amendments, during the period covered by this report,
to a provision of the 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 description.
(d) The registrant has not granted any waivers, including an implicit
waiver, from a provision of the 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, that relates to one or more of the
items set forth in paragraph (b) of this item's instructions.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
As of the end of the period covered by the report, the registrant's board of
directors has determined that Margaret Duffy is qualified to serve as an audit
committee financial expert serving on its audit committee and that she is
"independent."
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Audit Fees
----------
(a) 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 are $ 37,595
(2006) and $31,500 (2007).
Audit-Related Fees
------------------
(b) 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 are $0 (2006) and $0 (2007).
Tax Fees
--------
(c) 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 are $3,605 (2006) and $3,500
(2007).
All Other Fees
--------------
(d) 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 are $0
(2006) and $0 (2007).
(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.
THE NEW IRELAND FUND, INC.
Audit Committee Policy
on
Pre-Approval of Services Provided by the Independent Accountants
----------------------------------------------------------------
The Audit Committee of The New Ireland Fund, Inc. (the "Fund") is
charged with the responsibility to monitor the independence of the
Fund's independent accountants. As part of this responsibility, the
Audit Committee must pre-approve any independent accounting firm's
engagement to render audit and/or permissible non-audit services, as
required by law. In evaluating a proposed engagement of the independent
accountants, the Audit Committee will assess the effect that the
engagement might reasonably be expected to have on the accountant's
independence. The Committee's evaluation will be based on:
a review of the nature of the professional services expected
to be provided,
a review of the safeguards put into place by the accounting
firm to safeguard independence, and
periodic meetings with the accounting firm.
POLICY FOR AUDIT AND NON-AUDIT SERVICES PROVIDED TO THE FUNDS
On an annual basis, the scope of audits for the Fund, audit fees and
expenses, and audit-related and non-audit services (and fees proposed
in respect thereof) proposed to be performed by the Fund's independent
accountants will be presented by the Treasurer and the independent
accountants to the Audit Committee for review and, as appropriate,
approval prior to the initiation of such services. Such presentation
shall be accompanied by confirmation by both the Treasurer and the
independent accountants that the proposed services will not adversely
affect the independence of the independent accountants. Proposed
services shall be described in sufficient detail to enable the Audit
Committee to assess the appropriateness of such services and fees, and
the compatibility of the provision of such services with the auditor's
independence. The Committee shall receive periodic reports on the
progress of the audit and other services which are approved by the
Committee or by the Committee Chairman pursuant to authority delegated
in this Policy.
The categories of services enumerated under "Audit Services",
"Audit-related Services", and "Tax Services" are intended to provide
guidance to the Treasurer and the independent accountants as to those
categories of services which the Committee believes are generally
consistent with the independence of the independent accountants and
which the Committee (or the Committee Chairman) would expect upon the
presentation of specific proposals to pre-approve. The enumerated
categories are not intended as an exclusive list of audit,
audit-related or tax services which the Committee (or the Committee
Chairman) would consider for pre-approval.
AUDIT SERVICES
The following categories of audit services are considered to be
consistent with the role of the Fund's independent accountants:
Annual Fund financial statement audits
SEC and regulatory filings and consents
AUDIT-RELATED SERVICES
The following categories of audit-related services are considered to be
consistent with the role of the Fund's independent accountants:
Accounting consultations
Agreed upon procedure reports
Attestation reports
Other internal control reports
Individual audit-related services that fall within one of these
categories and are not presented to the Audit Committee as part of the
annual pre-approval process will be subject to pre-approval by the
Committee Chairman (or any other Committee member on whom this
responsibility has been delegated) so long as the estimated fee for
those services does not exceed $7,500.
TAX SERVICES
The following categories of tax services are considered to be
consistent with the role of the Fund's independent accountants:
Tax compliance services related to the filing or amendment of
the following:
Federal, state and local income tax compliance; and
Sales and use tax compliance
Timely RIC qualification reviews
Tax distribution analysis and planning
Accounting methods studies
Tax consulting services and related projects
Individual tax services that fall within one of these categories and
are not presented to the Audit Committee as part of the annual
pre-approval process will be subject to pre-approval by the Committee
Chairman (or any other Committee member on whom this responsibility has
been delegated) so long as the estimated fee for those services does
not exceed $7,500.
OTHER NON-AUDIT SERVICES
Certain non-audit services that the independent accountants are legally
permitted to render will be subject to pre-approval by the Committee or
by one or more Committee members to whom the Committee has delegated
this authority and who will report to the full Committee any
pre-approval decisions made pursuant to this Policy. Non-audit services
presented for pre-approval pursuant to this paragraph will be
accompanied by a confirmation from both the Treasurer and the
independent accountants that the proposed services will not adversely
affect the independence of the independent accountants.
PROSCRIBED SERVICES
The Fund's independent accountants will not render services in the
following categories of non-audit services:
Bookkeeping or other services related to the accounting
records or financial statements of the Fund
Financial information systems design and implementation
Appraisal or valuation services, fairness opinions, or
contribution-in-kind reports
Actuarial services
Internal audit outsourcing services
Management functions or human resources
Broker or dealer, investment adviser, or investment
banking services
Legal services and expert services unrelated to the audit
Any other service that the Public Company Accounting
Oversight Board determines, by regulation, is impermissible.
PRE-APPROVAL OF NON-AUDIT SERVICES PROVIDED TO BIAM AND BIAM AFFILIATES
Certain non-audit services provided to Bank of Ireland Asset Management
(U.S.) Limited ("BIAM") or any entity controlling, controlled by or
under common control with BIAM that provides ongoing services to the
Fund ("BIAM Affiliates") will be subject to pre-approval by the Audit
Committee. The only non-audit services provided to these entities that
will require pre-approval are those related directly to the operations
----------------------------------
and financial reporting of the Fund. Individual projects that are not
-----------------------------------
presented to the Audit Committee as part of the annual pre-approval
process, will be subject to pre-approval by the Committee Chairman (or
any other Committee member on whom this responsibility has been
delegated) so long as the estimated fee for those services does not
exceed $75,000. Services presented for pre-approval pursuant to this
paragraph will be accompanied by a confirmation from both the Treasurer
and the independent accountants that the proposed services will not
adversely affect the independence of the independent accountants.
Although the Audit Committee will not pre-approve all services provided
to BIAM Affiliates, the Committee will receive an annual report from
the Fund's independent accounting firm showing the aggregate fees for
all services provided to BIAM and BIAM Affiliates.
December 10, 2003
(e)(2) The percentage of services described in each of paragraphs (b) through
(d) of this Item that were approved by the audit committee pursuant to
paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X are as follows:
(b) N/A
(c) 100%
(d) N/A
(f) 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
was zero.
(g) 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 was $0 (2006) and $0 (2007).
(h) The registrant's audit committee of the board of directors has
considered whether the provision of non-audit services that were
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
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.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
The registrant has a separately designated audit committee consisting of the
following independent directors of the registrant: Margaret Duffy,
Peter J. Hooper, George G. Moore and David Dempsey.
ITEM 6. SCHEDULE OF INVESTMENTS.
Schedule of Investments in securities of unaffiliated issuers as of the close of
the reporting period is included as part of the report to shareholders filed
under Item 1 of this form.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
BANK OF IRELAND ASSET MANAGEMENT
PROXY VOTING POLICY FOR ACTIVELY MANAGED CLIENTS
REVIEWED: APRIL 2007
TABLE OF CONTENTS:
------------------
I:PROXY VOTING PROCEDURES
-------------------------
PURPOSE.......................................................................3
SCOPE.........................................................................3
GUIDING PRINCIPLES............................................................3
DECISION AND VOTING PROCESS...................................................3
PROXY VOTING COMMITTEE........................................................4
CONFLICTS OF INTEREST.........................................................4
WHEN BIAM DOES NOT VOTE PROXIES...............................................5
II:PROXY VOTING GUIDELINES
--------------------------
AUDITORS......................................................................6
BOARD OF DIRECTORS............................................................6
Election of Directors
Classification/Declassification of the Board
Majority Voting Proposals in the election of Directors
Voting for Director Nominees in Contested Elections
Voting for Strategic Initiatives in Contested Elections
Director Indemnification and Liability Provisions
Board Size
Independent Chairman (Separate Chairman/CEO)
Majority of Independent Directors/Establishment of Committees
Director Tenure/Retirement Age
Filling of Vacancies/Removal of Directors
Executive and Director Compensation
SHAREHOLDER RIGHTS............................................................9
Confidential Voting
Shareholder Ability to Call Special Meetings
ANTI-TAKEOVER MEASURES........................................................9
Amend Bylaws without Shareholder Consent
Anti-Takeover Provisions
Poison Pill Plans
Greenmail
Golden and Tin Parachutes
CAPITAL STRUCTURE............................................................11
Adjustments to Par Value of Common Stock
Common Stock Authorization
Preferred Stock
Pre-emptive Rights
Share Repurchase Programs
Stock Distributions: Splits and Dividends
MERGERS AND CORPORATE RESTRUCTURING..........................................12
Going Private Transactions (LBOs and Minority Squeezeouts)
Spin-offs
MISCELLANEOUS................................................................13
Stock Option Expensing
Amending Minor Bylaws
Changing Corporate Name
Changing Date, Time or Location of Annual Meeting
Cumulative Voting
I PROXY VOTING PROCEDURES
A. PURPOSE
Bank of Ireland Asset Management Limited and the BIAM group of companies
("BIAM") has adopted and implemented these policies and procedures ("Policies")
to seek to ensure that client proxies are voted in the clients' best interests,
in accordance with BIAM's fiduciary duties to clients and, in the case of BIAM
(U.S.), with SEC rule 206(4)-6 under the Investment Advisers Act of 1940. BIAM
believes that the Policies set forth herein are reasonably designed to achieve
that goal.
B. SCOPE
BIAM's authority to vote the proxies of its clients is established by its
advisory contracts and its proxy voting guidelines have been tailored to reflect
these specific contractual obligations. These Policies apply where clients have
delegated the authority and responsibility to BIAM to decide how to vote
proxies. Where BIAM has agreed to follow client guidelines in voting proxies,
client guidelines will be followed and supersede these Policies. BIAM also will
follow these Policies, as applicable, if it provides advice or recommendations
about specific proxy votes to clients that have not delegated voting
responsibility to BIAM. These Policies may be changed from time to time.
C. GUIDING PRINCIPLES
It is the policy of BIAM to vote all proxies for the exclusive benefit of its
clients. The maximization of total return for the client as an investor in the
stock being voted is the governing influence in considering corporate voting
decisions.
D. DECISION AND VOTING PROCESS
BIAM's proxy voting decisions are made by the Asset Managers. (For clients that
have specific voting guidelines, the Investment Support Unit will determine the
votes to be cast at a client level.) BIAM may vote differently on the same
matter if client guidelines or specific instructions call for a vote that is
inconsistent with BIAM's Proxy Voting Guidelines or a decision made by BIAM's
Asset Managers. In unusual circumstances, BIAM Asset Managers may make different
proxy voting decisions for different clients.
The Investment Support Unit is responsible for the communication of voting
decisions between the Asset Managers and BIAM's proxy voting agent (the
"Agent"). The Agent provides BIAM with all voting and shareholder meeting
information necessary for informed and timely decision making. The Agent is
responsible for the timely and accurate processing of the voting decision, and
the distribution of this decision to all relevant parties. The Agent is also
responsible for unblocking / rescinding a voting decision upon request from
BIAM.
E. PROXY VOTING COMMITTEE
BIAM has established a Proxy Voting Committee ("Committee") to deal with various
issues associated with proxy voting. The role of the Committee is to develop and
periodically review these Policies to help ensure they are up to date and
reflect current regulatory requirements; review compliance with these Policies;
and critically evaluate exceptions to the Policies. The Committee also is
responsible for taking reasonable steps to seek to identify any material
conflicts of interest on the part of BIAM or its personnel that may affect
particular proxy votes. The Committee is comprised of representatives from Asset
Management; the Investment Support Unit; Compliance and Client Service.
F. CONFLICTS OF INTEREST
Occasions may arise where BIAM may have a material conflict of interest with
respect to a matter to be voted. A material conflict of interest may exist, for
example, if BIAM has a very significant business relationship with either the
company whose stock is being voted, the person soliciting the proxy or a third
party that has a material interest in the outcome of the proxy vote.
The Proxy Voting Committee provides guidance to assist BIAM personnel in
identifying potential conflicts of interest and bringing them to the attention
of the Committee. The Committee is responsible for evaluating the materiality of
any conflicts. These Policies describe some, but not all, of the specific types
of conflicts of interest that BIAM may encounter in connection with proxy
voting. The Committee is expected to evaluate the particular facts and
circumstances of each situation and exercise its best judgment in deciding
whether the conflicts are material and how they should be addressed. A member of
BIAM's senior management will be designated, upon request from the Committee,
for consultation and to resolve any conflicts issue on which the Committee has
been unable to reach a decision on its own. This designate will appoint a
conflict resolution team in order to come to a decision on the vote in question.
The conflict resolution team appointed will include a minimum of three members
of the management team. The conflict team will also include either the Chief
Executive Officer and /or the of Head of Compliance. The Chief Executive Officer
will exclude himself from the conflict resolution team in the event that he is
involved in the vote (i.e. election / re-election).
When a material conflict of interest is identified, BIAM may (1) vote the
proxies in accordance with the general rule stated in the Proxy Voting
Guidelines set forth in these Policies (as may be amended from time to time),
provided the guidelines specify how votes generally will be cast on that
particular type of matter, i.e., the guidelines state that BIAM generally will
vote "for" or "against" the proposal; (2) seek voting instructions or a waiver
of the conflict from the trustee's / clients whose securities are to be voted
on; (3) cast the votes for its clients in the same proportion as the vote of all
other holders of such security, or "mirror vote," if information about the votes
cast by other holders is reasonably and timely available to BIAM; (4) refrain
from voting, other than to vote "present" for purposes of a quorum or (5) take
other action appropriate under the circumstances.
An adviser-client relationship will not be considered material for conflict
purposes if the gross investment advisory income received from the relationship
by BIAM during its most recent fiscal year did not exceed one percent (1%) of
BIAM's overall annual gross investment advisory income and is not expected to
exceed that amount in the current fiscal year.
BIAM sets its Proxy Voting Guidelines and makes each proxy voting decision
independently, in the best interests of its clients and without regard to the
interests of BIAM, its parent company or any other affiliates of BIAM. In
addition, as a matter of policy, BIAM will not accept or consider direction from
its affiliates on how to vote any particular proxy.
G. WHEN BIAM DOES NOT VOTE PROXIES
In appropriate circumstances, BIAM may not vote proxies respecting client
securities, including, but not limited to, situations where (a) the securities
are no longer held in a client's account; (b) the proxy and other necessary
documents are not received in sufficient time to allow BIAM to analyze the
material or cast an informed vote by the voting deadline; (c) BIAM concludes
that the cost of voting the proxy outweighs any potential benefit to the client;
(d) in BIAM's judgment, the matter to be voted is neither material nor relevant
to shareholders and the issuer of the securities; (e) securities have been
loaned out pursuant to a client's securities lending program and are unavailable
to vote; or (f) the value or amount of the securities to be voted is
insignificant or undeterminable. BIAM also may refrain from voting a proxy where
BIAM believes that it is in the client's best interest to do so. Generally, this
will occur if BIAM is in disagreement with the proposals but the management have
committed to make, within an agreed time frame, appropriate changes which in
BIAM's view will favor shareholders.
In certain markets, shareholders are required to stop trading securities for a
specified time before or after a shareholder meeting ("Blocking Period"). BIAM
may refrain from voting or cancel a vote when BIAM concludes that it is more
beneficial to clients to be free to trade the securities than to vote
securities. In addition, BIAM will, to the best of its ability, unblock a share
position that is subject to a Blocking Period if there is danger of a failed
trade. Blocking only occurs in certain markets and the Blocking Periods and
rules vary from country to country, and in certain circumstances, from company
to company.
II PROXY VOTING GUIDELINES
The following are guidelines and as such are not exhaustive and do not include
all potential voting issues. Because proxy issues and the circumstances of
individual companies are so varied, there may be instances when BIAM will not
vote in strict adherence to these guidelines. Votes on matters not covered by
these guidelines will be determined in accordance with the guiding principles
set forth above. Certain proxy questions that are company specific and of a
non-routine nature may be more appropriately handled on a case-by-case basis. At
any time, BIAM may seek voting instructions from some or all clients holding the
securities to be voted.
AUDITORS
BIAM generally will vote FOR proposals to ratify auditors, unless there is
reason to believe that an auditor has a material financial interest in or
association with the company, and is therefore not independent, or there is
reason to believe that the independent auditor has rendered an opinion which is
neither accurate nor indicative of the company's financial position.
BOARD OF DIRECTORS
ELECTION OF DIRECTORS
Electing directors is an important stock ownership right that shareholders can
exercise. Shareholders should seek to elect directors who represent their
interests and will act in a manner which will maximize the value of their
ownership interest and who can ultimately be held accountable for their actions.
o BIAM generally will vote FOR all nominees in uncontested elections.
However, each election is examined on a case-by-case basis and BIAM will
withhold votes for or vote against individual nominees or entire slates of
directors if it believes such action is in the best interest of
shareholders.
CLASSIFICATION/DECLASSIFICATION OF THE BOARD
A classified board is one in which directors are divided into classes with each
class serving a fixed term. Elections are staggered with each class up for
re-election in different years. Board classification can result in less
accountability and can make it more difficult for dissidents to gain control.
o BIAM will generally vote AGAINST proposals to classify the Board. BIAM will
generally Vote FOR proposals to repeal classified Boards, and to elect
directors annually.
MAJORITY VOTING PROPOSALS IN DIRECTOR ELECTIONS
Majority voting gives shareholders a meaningful voice in director election. A
shift from plurality to majority voting in director elections means a director
needs to get an affirmative majority of votes cast. The plurality system elects
a director in an uncontested election once there is one affirmative vote, with
votes withheld/against not being counted.
o BIAM will generally vote FOR resolutions requesting that the board change
the company's bylaws to stipulate that directors need to be elected with an
affirmative majority of votes cast, provided it does not conflict with the
state law where the company is incorporated.
VOTING FOR DIRECTOR NOMINEES IN CONTESTED ELECTIONS
Proxy contests can play a valuable role in removing entrenched directors and
creating a means for corporate change.
o BIAM will review on a CASE-BY-CASE basis how it will cast its votes for
directors in a contested election based upon what BIAM believes are the
director nominees that will serve in the best interests of shareholders and
will enhance shareholder value.
VOTING FOR STRATEGIC INITIATIVES IN CONTESTED ELECTIONS
o Votes in a contested election to approve a strategic initiative will be
evaluated on a CASE-BY-CASE basis and voted in favor of the position that
BIAM believes will be in the best interest of shareholders and will enhance
shareholder value.
DIRECTOR INDEMNIFICATION AND LIABILITY PROVISIONS
Directors and officers are often faced with difficult choices and should be
willing to make decisions that are not risk-averse. BIAM believes that directors
should not be held accountable for actions taken where they have acted honestly
and in good faith but should not be fully released from liability if they act
outside of such parameters.
o BIAM generally will vote FOR proposals providing for indemnification and
liability limitations for officers and directors, provided the policies are
limited to the director acting honestly and in good faith and putting the
interests of the company first, rather than eliminating entirely director's
and officer's liability for monetary damages for violating the duty of
care.
BOARD SIZE
Proposals to allow management to increase or decrease the size of the board at
its own discretion are often used by companies as a takeover defense. By
increasing the size of the board, management can make it more difficult for
dissidents to gain control.
o BIAM generally will vote FOR proposals that seek to fix the size of the board.
o BIAM generally will vote AGAINST proposals that give management the ability
to alter the size of the board without shareholder approval.
INDEPENDENT CHAIRMAN (SEPARATE CHAIRMAN/CEO)
BIAM will review on a CASE-BY-CASE basis proposals to separate the roles of
chairman and CEO. BIAM will vote in favor of a combined role if the company has
implemented an appropriate counterbalancing governance structure. In determining
if the appropriate measures are in place BIAM may consider the following:
A. Designated lead director
B. 2/3 independent board
C. All independent key committees
D. Committee chairpersons nominated by independent directors
E. Established governance guidelines
MAJORITY OF INDEPENDENT DIRECTORS/ESTABLISHMENT OF COMMITTEES
BIAM believes that having a board independent of management is of the utmost
importance to both a company and its shareholders.
o BIAM generally will vote FOR proposals asking that a majority or more of
directors be independent.
o BIAM generally will vote FOR proposals asking that board audit,
compensation, and/or nominating committees be "independent". Independence
does not necessarily require that the entire committee be composed of
independent directors.
DIRECTOR TENURE/RETIREMENT AGE
Tenure and Age limits impose an arbitrary threshold beyond which director's may
not serve regardless of the director's performance.
o BIAM believes that directors should be judged on their own merit and will
generally vote AGAINST proposals for such arbitrary guidelines as age
restrictions.
o BIAM generally will vote FOR proposals that require directors to present
themselves for re-election on a periodic basis.
FILLING VACANCIES/REMOVAL OF DIRECTORS
Shareholder ability to remove directors, with or without cause, is prescribed by
a state's business corporation law, an individual company's articles of
incorporation, or its bylaws. If the state or company has specified that removal
may only be for cause, then such things as self-dealing or fraud will allow for
the removal of a director. Removal without cause requires no such showing, which
would allow shareholders to remove through a majority vote any director before
his or her term expires.
o BIAM will evaluate on a CASE-BY-CASE basis proposals that members of the
board can only be removed for cause.
Executive and Director Compensation
Directors compensation plans should be aligned with shareholders long-term
interests.
o Evaluation of plans will be done on a CASE-BY-CASE basis, considering
several factors in determining if it is reasonable and fair
SHAREHOLDER RIGHTS
Confidential Voting
In a confidential voting system, all proxies, and voting tabulations that
identify individual shareholders are kept confidential. This confidentiality can
eliminate any real or perceived coercion towards voters.
o BIAM generally will vote FOR proposals that corporations adopt confidential
voting, use independent vote tabulators or use independent inspectors of
election, as long as the proposal includes a provision for proxy contests
as follows: In the case of a contested election, management should be
permitted to request that the dissident group honor its confidential voting
policy. If the dissidents agree, the policy remains in place. If the
dissidents will not agree, the confidential voting policy is waived.
o BIAM generally will vote FOR proposals to adopt confidential voting by
shareholders.
SHAREHOLDER ABILITY TO CALL SPECIAL MEETINGS
Certain matters may arise between regularly scheduled shareholder meetings that
require attention. The inability of shareholders to call meetings could result
in shareholders being unable to remove directors, initiate a shareholder
resolution or respond to a beneficial offer without having to wait for the next
scheduled meeting. The inability to call a special meeting and the resulting
insulation of management could adversely affect corporate performance and
shareholder returns.
o BIAM generally will vote AGAINST proposals to restrict or prohibit
shareholder ability to call special meetings.
o BIAM generally will vote FOR proposals that remove restrictions on the
right of shareholders to act independently of management.
ANTI-TAKEOVER MEASURES
BIAM generally will vote AGAINST anti-takeover proposals if such proposals act
against the common interests of shareholders.
AMEND BYLAWS WITHOUT SHAREHOLDER CONSENT
o BIAM generally will vote AGAINST proposals giving the board exclusive
authority to amend the Bylaws.
o BIAM generally will vote FOR proposals giving the board the ability to
amend the bylaws with shareholder consent.
ANTI-TAKEOVER PROVISIONS
BIAM generally will vote AGAINST any proposed amendments to corporate Articles,
Bylaws or Charters that include anti-takeover provisions.
POISON PILL PLANS
Poison pills (or shareholder rights plans) are tactics used by management
fearing an unwelcome takeover bid. They cause a variety of events to occur which
may make the company financially less attractive to a potential acquirer.
o BIAM generally will vote FOR a proposal that the company submit a
shareholder rights plan (poison pill) to a shareholder vote.
o BIAM generally will vote AGAINST a proposal to renew or amend an existing
shareholder rights plan (poison pill).
o BIAM generally will vote FOR a proposal to redeem a shareholder rights plan
(poison pill).
o BIAM generally will vote AGAINST an increase in capital stock for use in
the implementation of a shareholder rights plan (poison pill).
GREENMAIL
Greenmail payments are targeted share repurchases by management of company stock
from individuals or groups seeking control of the company. Since only the
hostile party receives payment, usually at a substantial premium over the market
value of its shares, the practice discriminates against all other shareholders.
This transferred cash could, absent the greenmail payments, be put to use for
reinvestment in the company, payment of dividends, or to fund a public share
repurchase program.
o BIAM generally will vote FOR proposals to adopt anti-greenmail charter or
bylaw amendments or otherwise restrict a company's ability to make a
greenmail payment.
GOLDEN AND TIN PARACHUTES
Golden and tin parachutes are designed to protect the employees of a corporation
in the event of a change in control. Golden parachutes are payments to senior
level management that are triggered during a change of control. The calculation
is usually based on some multiple of an employee's annual or monthly
compensation. Some companies are extending the coverage to all employees via tin
parachutes.
o BIAM generally will vote FOR proposals that the company eliminate or
restrict existing severance agreements, change-in-control provisions, or
golden parachutes.
CAPITAL STRUCTURE
Adjustments to Par Value of Common Stock
Stock that has a fixed per share value printed on its certificate is called par
value stock. The purpose of par value stock is to establish the maximum
responsibility of a shareholder in the event that a company becomes insolvent.
Many times proposals to reduce par value stem from state law requirements or
banking regulations.
o BIAM generally will vote FOR management proposals to reduce the par
value of common stock.
COMMON STOCK AUTHORIZATION
State statutes and stock exchanges require shareholder approval for increases in
the number of common shares a board is authorized to issue. Companies increase
their supply of common stock for a variety of ordinary business purposes:
raising new capital, funding stock compensation programs, business acquisitions,
and implementation of stock splits or payment of stock dividends.
o BIAM generally will vote FOR increases in common stock authorized provided
such action is determined to be in the shareholders' best interests.
o BIAM will review on a CASE-BY-CASE basis proposals to approve a reduction
in the number of shares of common stock authorized for issue or an
elimination of an authorized class of common stock.
PREFERRED STOCK
o BIAM will review on a CASE-BY-CASE basis proposals to increase the number
of blank check preferred shares after analyzing the number of preferred
shares available for issue given a company's industry and performance in
terms of shareholder returns.
o BIAM will review on a CASE-BY-CASE basis proposal to eliminate a currently
authorized class of preferred stock.
SHARE REPURCHASE PLANS
o BIAM will generally vote FOR share repurchase plans .
PRE-EMPTIVE RIGHTS
Pre-emptive rights permit shareholders to share proportionately in any new
issues of stock of the same class. These rights guarantee existing shareholders
the first opportunity to purchase shares of new issues of stock in the class
they own, in an amount equal to the percentage of the class they already own.
o BIAM will generally vote FOR proposals on issuance requests with
pre-emptive rights up to a maximum of 100% of currently issued share
capital.
o For issuance requests without pre-emptive rights, BIAM will generally
vote FOR issuances up to a maximum of 20% of currently issued share
capital.
SHARE REPURCHASE PROGRAMS
o BIAM generally will vote FOR management proposals to institute open-market
share repurchase plans (Stock Repurchase Program).
STOCK DISTRIBUTIONS: SPLITS AND DIVIDENDS
o BIAM generally will vote FOR management proposals to increase the common
share authorization for a stock split or share dividend.
o BIAM generally will vote FOR recommended stock splits.
MERGERS AND CORPORATE RESTRUCTURINGS
o BIAM will review on a CASE-BY-CASE basis proposals for mergers and
acquisitions.
GOING PRIVATE TRANSACTIONS (LBOS AND MINORITY SQUEEZEOUTS)
o BIAM will review on a CASE-BY-CASE basis proposals to take a company
private, taking into account factors including, but not limited to, offer
price/premium, fairness opinion, how the deal was negotiated, conflicts of
interest, other alternatives/offers considered, and non-completion risk.
SPIN-OFFS
o BIAM will review on a CASE-BY-CASE basis proposed spin-offs, taking into
consideration factors including, but not limited to, tax and regulatory
advantages, planned use of the sale proceeds, valuation of the spin-off,
fairness opinion, benefits to the parent company, conflicts of interest,
managerial incentives, corporate governance changes and changes in the
capital structure.
MISCELLANEOUS
STOCK OPTION EXPENSING
o BIAM generally will vote FOR proposals that the company expense stock
options unless management has already publicly committed to start expensing
by a specific date.
AMENDING MINOR BYLAWS
o BIAM generally will vote FOR management proposals for bylaw or charter
changes that are of a housekeeping nature (updates or corrections).
CHANGING CORPORATE NAME
o BIAM generally will vote WITH MANAGEMENT with regard to changing the
corporate name.
CHANGING DATE, TIME OR LOCATION OF ANNUAL MEETING
o BIAM generally will vote FOR management proposals to change the
date/time/location of the annual meeting unless the proposed change is
unreasonable. BIAM requires at least ten days notice of any such change in
order to allow for custodian deadlines.
CUMULATIVE VOTING
Cumulative voting is a method of voting that permits shareholders to combine
their total Votes and cast different numbers of votes for different candidates.
o BIAM will generally vote AGAINST proposals to adopt cumulative voting
practices.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
(A)(1) IDENTIFICATION OF PORTFOLIO MANAGER(S) OR MANAGEMENT TEAM MEMBERS AND
DESCRIPTION OF ROLE OF PORTFOLIO MANAGER(S) OR MANAGEMENT TEAM MEMBERS
PETER O'DONOGHUE, CFA, EQUITY MANAGER
Peter O'Donoghue joined Bank of Ireland Asset Management (the
"Advisor") in 2001 though the graduate recruitment programme. Prior to
joining the Asset Management team, Peter held a number of roles in
various areas of the business including Portfolio Construction, Global
Support and our European office. He holds a BA in International
Business & Languages from Dublin City University and is also a CFA
charterholder. Peter is also a member of the Society of Investment
Analysts of Ireland. Peter O'Donoghue is primarily responsible for the
management of the Registrant's portfolio and has responsibility for all
the day-to-day management of the Registrant portfolio including stock
research, stock selection and portfolio management. Peter O'Donoghue
was appointed as Portfolio Manager of the Registrant on December 7,
2006.
(A)(2) OTHER ACCOUNTS MANAGED BY PORTFOLIO MANAGER(S) OR MANAGEMENT TEAM
MEMBER AND POTENTIAL CONFLICTS OF INTEREST
OTHER ACCOUNTS MANAGED BY PORTFOLIO MANAGER(S) OR MANAGEMENT
TEAM MEMBER
As of December 31, 2007 Mr. O'Donoghue did not manage any other
registered investment companies.
Peter O'Donoghue is also a member of the EAFE Product Investment Team.
As of October 31, 2007 this team managed the following accounts:
--------------------- ------------------- ----------------------- ---------------------- ------------------------
No. of Accounts Total Assets in
Total where Advisory Fee Accounts where
No. of Accounts is Based on Advisory Fee is Based
Type of Accounts Managed Total Assets Performance on Performance
---------------- ------- ------------ ----------- -----------
--------------------- ------------------- ----------------------- ---------------------- ------------------------
--------------------- ------------------- ----------------------- ---------------------- ------------------------
Registered 0 0 0 0
Investment
Companies:
--------------------- ------------------- ----------------------- ---------------------- ------------------------
--------------------- ------------------- ----------------------- ---------------------- ------------------------
Other Pooled 2 $98,232,353 0 0
Investment Vehicles:
--------------------- ------------------- ----------------------- ---------------------- ------------------------
--------------------- ------------------- ----------------------- ---------------------- ------------------------
Other Accounts: 6 $2,881,076,037 0 0
--------------------- ------------------- ----------------------- ---------------------- ------------------------
POTENTIAL CONFLICTS OF INTERESTS
In recognition of the fact that conflicts of interest are inherent in
the investment management business, the Advisor has adopted policies
and procedures reasonably designed to identify and manage the effects
of actual or potential conflicts of interest in the areas of employee
personal trading, managing multiple accounts for multiple clients and
allocation of investment opportunities.
The Advisor has adopted a code of ethics policy that is designed to
reduce the risk of actual or potential conflicts of interest with
dealings on behalf of clients. The code reflects the Advisor's
fiduciary obligations and those of its employees, and requires that all
employees comply with all applicable federal securities laws. The
Advisor's personal dealing rules apply to all employees. In summary,
the code requires pre-approval of all personal dealings in equity
securities or securities that derive their value from equity
securities. As a general matter, permission to execute a proposed
personal trade in a security will generally be refused if the Advisor
has executed, or intends to execute material client trades in the same
security, in the seven days before or the seven days following the
proposed employee deal. The code requires employees to report any
transactions in mutual funds where the Advisor acts as an adviser or
sub-adviser to the fund. The code also covers issues such as prohibited
transactions, blackout periods for transactions, and short term
trading.
In addition to managing the Registrant's Portfolio, the Portfolio
Manager is a member of a team that manages multiple portfolios for
multiple clients. Accordingly the Portfolio Manager may have
responsibility for managing the investments of multiple accounts with a
common investment strategy or several investment styles. Accordingly,
client portfolios may have investment objectives, strategies, time
horizons and risk profiles that differ from those of the Registrant.
The portfolio Manager makes investment decisions for the Registrant
based on its investment objective, policies and other relevant
investment considerations, Consequently, the Portfolio Manager may
purchase or sell securities for one client portfolio and not another
client portfolio, and the performance of securities purchased for one
portfolio may vary from the performance of securities purchased for
other portfolios. The Portfolio Manager may place transactions on
behalf of other clients that are directly or indirectly contrary to
investment decisions made on behalf of the Registrant, which has the
potential to adversely impact the Registrant, depending on market
conditions. There is a fiduciary duty for the Advisor to act in good
faith for the benefit of its clients; to disclose fully and fairly all
material facts; and to allocate trades in a fair and equitable manner.
The Advisor has implemented allocation procedures that specify the
factors taken into account in making allocation decisions for its
clients and to ensure that all accounts with substantially similar
investment objectives are treated equitably. These procedures ensure
that clients are treated fairly as to the securities purchased or sold
for their accounts, in the priority of execution of orders and the
allocation of trades.
Generally, the above will be achieved by allocating on a simple
pro-rata basis. However, to ensure that all clients get meaningful
order sizes in a cost effective manner, allocations to clients are
generally targeted to be greater than 0.03% of each client's account
assets. There are exceptions to the 0.03% De Minimus allocation such as
when IPO orders are only partially filled. Partially filled IPO orders
are generally allocated pro-rata in accordance with the original order
without reference to achieving a minimum targeted percentage of client
assets. Lastly the performance of similarly managed accounts is
monitored to ensure consistency of performance and to detect any
unexplained significant differences.
(A)(3) COMPENSATION STRUCTURE OF PORTFOLIO MANAGER(S) OR MANAGEMENT
TEAM MEMBERS
The Registrant pays the Advisor a fee based on the assets under
management of the Fund as set forth in the Advisory Agreement. The
Advisor pays its investment professionals out of its total revenues and
other resources, including the advisory fee earned with respect to the
Registrant. There are three components to the compensation structure
used by the Advisor. The compensation package is highly competitive and
includes a competitive fixed base salary, a performance-linked bonus
and a Bank of Ireland Group capital stock issue plan. Compensation is
not based on the value of assets held in the Registrant's portfolio.
The performance measures used are applied consistently among all
portfolio managers and portfolios.
The bonuses paid to the portfolio managers are linked both to the
quality of an individual's stock research and also to the contribution
they make to the performance of the product group and/or portfolio to
which they are associated. The primary performance assessment of the
portfolio manager is based on how the client portfolios perform
relative to benchmarks, market indices and similar funds run by
competitor managers.
The stock issue plan is based on the overall profitability of Bank of
Ireland while bonuses are based on the profitability of Bank of Ireland
Asset Management and on individual achievement.
(A)(4) DISCLOSURE OF SECURITIES OWNERSHIP
As of December 31, 2007 beneficial ownership of shares of the
registrant by the Portfolio Manager is as follows:
Name of Portfolio Manager or Dollar ($) Range of Fund
Team Member Shares Beneficially Owned
Peter O'Donoghue 0
(B) Not applicable.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
REGISTRANT PURCHASES OF EQUITY SECURITIES
(d) Maximum Number (or
(b) Average (c) Total Number of Shares Approximate dollar Value) of
(a) Total Number Price Paid Per (or Units purchased as Part Shares (or Units) that May Yet Be
of Shares (or Share (or of Publicly Announced Plans Purchased Under the Plans or
Period Units) Purshased Unit) or Programs Programs
May 1 2007 to May 0 0 0 464,166
31 2007
June 1 2007 to 0 0 0 464,166
June 30 2007
July 1 2007 to 24,400 30.15 24,400 464,166
July 31 2007
August 1 2007 to 81,400 29.47 81,400 464166
August 31 2007
September 1 2007 19,500 28.84 19,500 464,166
to September 30
2007
October 1 2007 to 0 0 0 464,166
October 31 2007
Total 125,300 29.50 125,300 464,166
a. The date each plan or program was announced: February 2000
b. The dollar amount (or share or unit amount) approved: 10% of shares
outstanding at the previous fiscal year end
c. The expiration date (if any) of each plan or program: None
d. Each plan or program that has expired during the period covered by the
table: None e. Each plan or program the registrant has determined to
terminate prior to expiration, or under which the
registrant does not intend to make further purchases: None
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
There have been no material changes to the procedures by which the shareholders
may recommend nominees to the registrant's board of directors, where those
changes were implemented after the registrant last provided disclosure in
response to the requirements of Item 407(c)(2)(iv) of Regulation S-K (17 CFR
229.407) (as required by Item 22(b)(15) of Schedule 14A (17 CFR 240.14a-101)),
or this Item.
ITEM 11. CONTROLS AND PROCEDURES.
(a) The registrant's principal executive and principal financial officers,
or persons performing similar functions, have concluded that the
registrant's disclosure controls and procedures (as defined in Rule
30a-3(c) under the Investment Company Act of 1940, as amended (the "1940
Act") (17 CFR 270.30a-3(c))) are effective, as of a date within 90 days
of the filing date of the report that includes the disclosure required
by this paragraph, based on their evaluation of these controls and
procedures required by Rule 30a-3(b) under the 1940 Act (17 CFR
270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b) under the Securities
Exchange Act of 1934, as amended (17 CFR 240.13a-15(b) or
240.15d-15(b)).
(b) There were no changes in the registrant's internal control over
financial reporting (as defined in Rule 30a-3(d) under the 1940 Act (17
CFR 270.30a-3(d)) that occurred during the registrant's second fiscal
quarter of the period covered by this report that has materially
affected, or is reasonably likely to materially affect, the registrant's
internal control over financial reporting.
ITEM 12. EXHIBITS.
(a)(1) Code of ethics, or any amendment thereto, that is the subject of
disclosure required by Item 2 is attached hereto.
(a)(2) Certifications pursuant to Rule 30a-2(a) under the 1940 Act and
Section 302 of the Sarbanes-Oxley Act of 2002 are attached hereto.
(a)(3) Not applicable.
(b) Certifications pursuant to Rule 30a-2(b) under the 1940 Act and
Section 906 of the Sarbanes-Oxley Act of 2002 are attached hereto.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
(registrant) The New Ireland Fund, Inc.
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By (Signature and Title)* /s/ Brendan Donohoe
-------------------------------------------------------
Brendan Donohoe, President
(principal executive officer)
Date December 18, 2007
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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/ Brendan Donohoe
-------------------------------------------------------
Brendan Donohoe, President
(principal executive officer)
Date December 18, 2007
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By (Signature and Title)* /s/ Lelia Long
-------------------------------------------------------
Lelia Long, Treasurer
(principal financial officer)
Date December 18, 2007
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* Print the name and title of each signing officer under his or her signature.