New Perspective Fund – ‘N-30D’ for 9/30/97

As of:  Tuesday, 12/9/97   ·   For:  9/30/97   ·   Accession #:  71516-97-24   ·   File #:  811-02333

in

this entire Filing. an “Entity” Search.

Show

Documents searched

and

each “hit”. the 1st “hit”.

↓↑Hints

Annual or Semi-Annual Report Mailed to Shareholders   —   Rule 30d-1
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: N-30D       Annual or Semi-Annual Report Mailed to                37±   155K 
                          Shareholders                                           

Document Table of Contents

[The American Funds Group (R)]                                                  

NEW PERSPECTIVE FUND                                                            

[sketch: flat depiction of globe]                                               

1997 ANNUAL REPORT                                                              
for the year ended September 30                                                 

NEW PERSPECTIVE FUND (R) seeks long-term growth of capital through investments  
all over the world, including the United States.                                

New Perspective is one of the 28 mutual funds in The American Funds Group,(R)   
managed by Capital Research and Management Company. Since 1931, Capital has     
invested with a long-term focus based on thorough research and attention to     
risk.                                                                           

RESULTS AT A GLANCE                                                             

FISCAL 1997                                                                     
for the year ended                                                              
September 30, 1997           Total return*                                      

New Perspective Fund                +30.0%                                      
Morgan Stanley Capital                                                          
International Indexes:                                                          
World Index                       +24.6%                                    
USA Index                         +40.2%                                    

LIFETIME OF THE FUND                                                            
from March 13, 1973                                Average annual               
through September 30, 1997    Total return*      compound return*               

New Perspective Fund              +3,091.4%                +15.1%               
Morgan Stanley Capital                                                          
International Indexes:                                                          
World Index                     +1,538.2%                +12.1%             
USA Index                       +1,896.1%                +13.0%             

*With dividends and capital gain distributions reinvested                       

[sketches of globe changing from flat to round shape]                           

About our cover:  In the 1930s, Buckminster Fuller, the educator, engineer,     
architect and futurist, began developing a new perception of the Earth with his 
creation of the Fuller Projection Dymaxion (TM) (Dynamic + Maximum + Tension)   
map. As the first two-dimensional world map accurate in terms of the relative   
sizes of land masses, it provided an unprecedented look at the whole Earth at   
once. New Perspective Fund's investment professionals take a similar approach,  
looking at companies from every angle to get a comprehensive picture before     
they invest.                                                                    

The word "Dymaxion" and the Fuller Projection Dymaxion (TM) Map design are      
trademarks of the Buckminster Fuller Institute, Santa Barbara, California,      
(c)1938, 1967 & 1992. All rights reserved.                                      

FUND RESULTS IN THIS REPORT WERE COMPUTED WITHOUT A SALES CHARGE UNLESS         
OTHERWISE INDICATED. THE FIGURES IN THIS REPORT REFLECT PAST RESULTS. SHARE     
PRICE AND RETURN WILL VARY, SO YOU MAY LOSE MONEY BY INVESTING IN THE FUND. THE 
SHORTER THE TIME PERIOD OF YOUR INVESTMENT, THE GREATER THE POSSIBILITY OF      
LOSS. FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR INSURED OR GUARANTEED  
BY, THE U.S. GOVERNMENT, ANY FINANCIAL INSTITUTION, THE FEDERAL DEPOSIT         
INSURANCE CORPORATION, OR ANY OTHER AGENCY, ENTITY OR PERSON. INVESTING OUTSIDE 
THE UNITED STATES IS SUBJECT TO ADDITIONAL RISKS, SUCH AS CURRENCY FLUCTUATIONS 
AND POLITICAL INSTABILITY, WHICH ARE DETAILED IN THE FUND'S PROSPECTUS.         

FELLOW SHAREHOLDERS:                                                            

Fiscal 1997 was another profitable year for New Perspective Fund, its best for  
total return in a decade. For the 12 months ended September 30, the value of    
your investment rose 30.0% if you reinvested income dividends totaling 33 cents 
a share and the capital gain distribution of 68 cents paid during the fiscal    
period.                                                                         

  By comparison, the unmanaged Morgan Stanley Capital International (MSCI)
World Index, which measures the world's major stock markets including the       
United States, rose 24.6%. That also was the average gain of 170 global equity  
funds tracked by Lipper Analytical Services.                                    

As NPF approaches its quarter-century anniversary as one of the oldest
global mutual funds, fiscal 1997 results lifted the fund's total return since   
its inception in March 1973 to 3,091.4%. This translates into an average annual 
compound return of 15.1%. The MSCI World Index gained an average of 12.1% a     
year during that period, while the average for global funds was 14.4% a year.   

A STRONG ENVIRONMENT FOR INVESTING                                              

   During fiscal 1997, most of the world's major markets enjoyed exceptional
growth. Propelled by moderate inflation, low interest rates and sustained       
capital inflows from optimistic investors, most markets posted double-digit     
gains both in local currency and in U.S. dollars, despite the dollar's relative 
strength. In the United States, the fund's largest area of concentration, the   
market overall rose 40.2% as measured by the MSCI USA Index. The United         
Kingdom, NPF's next largest area of holdings, also did well, roughly matching   
the U.S. gain in dollar terms. (The table on page 2 shows returns for major     
markets.)                                                                       

  At the other end of the spectrum, a number of Asian markets fared poorly
during the fiscal year. Despite a brief uptick in the first quarter of 1997,    
Japan's sluggish economy led to a 15.7% decline in stock prices in dollar       
terms. Good stock selection, however, meant that a number of our Japanese       
holdings rose in price during the year, including Sony (+50.1%), Fuji Photo     
Film (+36.0%) and Toyota (+20.2%). The market downturn also provided an         
opportunity to increase our investments in Japanese equities. Japan now         
accounts for 5.6% of net assets, up from 3.1% a year ago. Elsewhere in the      
region, currency turmoil in midsummer roiled markets across Southeast Asia,     
sending currency values and stock prices spiraling downward. With virtually no  
investments in the affected countries, the crisis had little impact on the      
fund. (The fund does have investments in Hong Kong stocks, which tumbled        
several weeks after the close of the reporting period; however, at 1.6% of net  
assets our position in that market is relatively small.)                        

A FOCUSED RESEARCH EFFORT                                                       

As we have frequently mentioned, New Perspective Fund invests in      
companies, not countries. That individual focus is supported by in-depth        
research into every security we consider for the fund. In the feature beginning 
on page 6, we take you on a tour of how that research effort is conducted among 
companies in our largest industry concentrations.                               

  Our analytical approach leads to broad diversification. On September 30,
the fund held 238 companies in 27 countries and 34 industries. The portfolio    
showed broad strength: Of stocks held over the entire period, 143 rose in price 
and 31 declined.                                                                

During the past fiscal year, our 10 largest holdings made solid       
contributions to NPF's growth. They include two longtime holdings, Finnish      
cellular phone manufacturer Nokia (+111.9%) and Caterpillar (+43.1%); the       
Spanish telecommunications company Telefonica de Espana, a relatively new       
holding, rose 69.9%.                                                            

[photos: globe cutouts]                                                         
[Begin sidebar]                                                                 
WHERE NPF'S ASSETS                                                              
WERE INVESTED                                                                   
(percent invested by country)                                                   
        9/30/97        9/30/96

ASIA/PACIFIC RIM                   12.0%           9.8%                         
Japan                               5.6            3.1                          
Australia                           3.4            3.6                          
Hong Kong                           1.6            1.6                          
New Zealand                          .8            1.5                          
Taiwan                               .5              -                          
South Korea                          .1              -                          

EUROPE                             31.9%          37.9%                         
United Kingdom                      6.5            7.2                          
France                              5.6            7.3                          
Sweden                              4.2            5.9                          
Netherlands                         3.6            4.2                          
Switzerland                         3.1            3.5                          
Germany                             2.4            4.8                          
Spain                               2.0            2.0                          
Italy                               1.8             .7                          
Finland                             1.6            1.3                          
Norway                               .6             .4                          
Denmark                              .4             .4                          
Luxembourg                           .1             .1                          
Belgium                               -             .1                          

NORTH AMERICA                      41.1%          35.2%                         
United States                      33.8           28.3                          
Canada                              5.8            5.4                          
Mexico                              1.5            1.5                          

OTHER                               3.6%           2.9%                         

CASH & EQUIVALENTS                 11.4%          14.2%                         
         100.0%         100.0%
[End sidebar]                                                                   

The smallest increases among our 10 largest holdings were recorded by 
Astra, the Swedish pharmaceutical company (+15.6%), and the U.S. memory-chip    
maker Micron Technology (+13.7%). Astra suffered from investor concern over a   
patent expiration on its major ulcer drug, Losec, but we continue to believe    
that the strength of the balance sheet and flow of new products bode well for   
the company. Micron's lackluster return was caused by a slowdown in personal    
computer demand earlier in the year, not unusual in such a cyclical business.   

  In a period in which investor concentration on a relatively small number
of very large U.S. companies was driving the U.S. stock market higher, NPF      
maintained a significantly broader base. At the close of the fiscal year, the   
fund held nearly 34% in U.S. stocks, up from 28% last year; Europe accounted    
for 32% of net assets; Asia and the Pacific Rim for 12%, and other countries    
for about 11%. The balance was held in cash and equivalents as a buying         
reserve.                                                                        

LOW TURNOVER AS WELL AS LOW EXPENSES                                            

An important part of New Perspective Fund's investment strategy is a  
long-term perspective. The fund's portfolio turnover rate (the rate at which    
holdings are bought and sold), averaging 21% of net assets over the last five   
years, is among the lowest of all global equity funds, according to Lipper.     
Turnover rates take on added significance for investors because of recent       
changes in U.S. tax law. The new provisions grant a reduction in long-term      
capital gains tax (to 20% from 28% for assets held longer than 18 months).      

We are also pleased to report that NPF's 0.79% annual expense ratio - 
already well under half the 1.92% average in its fund universe as measured by   
CDA/Wiesenberger - continued to trend downward (see table on page 34).          

NPF'S 401(K) ACCOUNTS GROW TO $1 BILLION                                        

 New Perspective Fund has continued to grow. Assets at year-end stood at
nearly $17 billion, up 45% from a year earlier. While some of that growth       
reflects appreciation in the portfolio, we also welcomed many new shareholder   
accounts, including a significant number of 401(k) retirement accounts. NPF now 
has nearly 30,000 such accounts, totaling just over $1 billion.                 

NPF's method of portfolio management, the multiple portfolio counselor
system, is helping it accommodate growth. Because the fund's assets are divided 
among a number of portfolio counselors, managers can be added as assets         
increase. The fund currently has five primary portfolio counselors, with an     
aggregate of 151 years of experience among them, and a research portfolio       
managed by 41 analysts.                                                         

World markets have been remarkably robust in recent years. A number of
factors have contributed. Inflation worldwide has been relatively benign, which 
has kept interest rates low. Technology has been helping businesses grow        
without putting pressure on wages. European governments have been taking        
disciplined fiscal measures to prepare for the introduction of the Euro in      
January 1999. Globalization has made many companies more competitive as they    
find new markets in which to do business.                                       

    At the same time, the rapid rise in many international markets, along with
the continued strength in the U.S., suggest caution as we move forward. Stock   
prices have become more volatile and less tolerant of profit disappointments    
and other shocks. Indeed, world markets dipped sharply shortly after the close  
of the fund's reporting period. This is why we have always maintained a         
long-term perspective on our investments and encourage shareholders to do the   
same.                                                                           

Cordially,                                                                      

[/s/ Walter P. Stern]                                                           
Walter P. Stern                                                                 
Chairman of the Board                                                           

[/s/ Gina H. Despres]                                                           
Gina H. Despres                                                                 
President                                                                       

November 17, 1997                                                               

[Begin sidebar]                                                                 
NEW PERSPECTIVE VERSUS THE MAJOR WORLD MARKET INDEXES                           
(with dividends reinvested)                                                     

                                                        [Enlarge/Download Table]

World's Major Stock       Latest Fiscal Year                Lifetime of the Fund           
Markets/1/                (10/1/96-9/30/97)                 (3/13/73-9/30/97)              
(listed in order of size  Local              Adjusted to  Local                 Adjusted to
of market capitalization  currency           U.S.$/2/     currency              U.S.$/2/   
as of 9/30/97)                                                                             
                                                                                           
United States                                                                              
  MSCI USA Index                             40.2%                              1,896.1%   
Japan                     -8.6%             -15.7           461.4%              1,128.9    
United Kingdom            35.5               40.0         3,994.0               2,632.8    
Germany                   52.1               31.4         1,115.5               1,861.5    
France                    42.3               23.8         2,255.0               1,574.0    
Canada                    35.7               33.6         1,184.3               816.8      
Switzerland               52.8               31.9         1,106.0               2,518.2    
Netherlands               66.1               42.8         3,864.7               5,350.8    
Hong Kong                 20.9               20.9         2,082.1               1,350.6    
Australia                 22.3               12.0         2,085.3               993.5      
Italy                     52.9               34.9         2,082.7               601.4      
Sweden                    64.0               43.3         9,256.6               5,277.6    
Spain                     83.9               58.3         1,801.8               630.8      
Belgium                   35.9               17.1         2,254.8               2,383.8    
Singapore                 -5.1              -12.7           353.6                 515.5    
MSCI World Index/3/                          24.6                               1,538.2    

NEW PERSPECTIVE FUND                         30.0%                              3,091.4%   

/1/ United States market represented by the U.S. component of MSCI World Index; 
all other markets computed by Capital International Perspective S.A. and        
included in MSCI World Index. All indexes are unmanaged.                        

/2/ Figures adjusted to reflect foreign exchange fluctuations relative to the   
U.S.  dollar.                                                                   

/3/ Includes the major stock markets throughout the world, weighted by size and 
adjusted to reflect foreign exchange fluctuation relative to the U.S. dollar.   
U.S. companies currently represent approximately 47% of the total index.        

All figures include the reinvestment of dividends. Returns for international    
indexes are with gross dividends reinvested (i.e., without local withholding    
taxes removed).                                                                 

NEW PERSPECTIVE'S 10 LARGEST STOCK HOLDINGS AT FISCAL YEAR-END                  

                                                                [Download Table]

                           PERCENT OF                              FOR 12 MONTHS
COMPANY                    NPF'S NET ASSETS       COUNTRY          ENDED 9/30/97
                                                                                
Astra                      2.23%                  Sweden           +15.6%       
Novartis                   2.10                   Switzerland      +57.2*       
Time Warner                2.05                   U.S.             +40.3        
Philip Morris              1.83                   U.S.             +38.9        
Pfizer                     1.73                   U.S.             +51.8        
Telefonica de Espana       1.51                   Spain            +69.9        
Caterpillar                1.46                   U.S.             +43.1        
Mannesmann                 1.43                   Germany          +27.5        
Micron Technology          1.40                   U.S.             +13.7        
Nokia                      1.33                   Finland          +111.9       

*Company formed by merger in December 1996. Figure contains certain             
hypothetical data.                                                              

HERE'S HOW A $10,000 INVESTMENT IN THE FUND GREW  between March 13, 1973 - when 
the fund was introduced - and September 30, 1997, the end of the fund's latest  
fiscal year. Unlike figures presented earlier in the report, the fund's results 
in this chart reflect payment of the maximum sales charge of 5.75%, so the net  
amount invested was $9,425 versus $10,000 in the indexes shown. The indexes are 
unmanaged and do not have sales charges, commissions or expenses. As you can    
see, the investment in New Perspective would have grown to $300,835 versus      
$163,819 in the Morgan Stanley Capital International (MSCI) World Index, which  
reflects results in 22 major markets, and $199,607 in the MSCI USA Index.       

New Perspective's year-by-year results appear in the table under the chart. The 
table shows that NPF recorded positive results in 21 of these 25 periods, and   
the boxed figure at the bottom right of the table shows that over the entire    
241/2 years the investment grew at an average compound rate of 14.9% a year.    
You can use this table to estimate how much the value of your own holdings has  
grown. Let's say, for example, that you have been reinvesting all your          
dividends and capital gain distributions and want to know how your investment   
has done since September 30, 1987. At that time, according to the table, the    
value of the investment illustrated here was $94,727. Since then, it has more   
than tripled to $300,835. Thus, in that same period, the value of your          
investment - regardless of size - also has more than tripled.                   

NPF'S RETURN VERSUS OTHER GLOBAL EQUITY FUNDS                                   
(with distributions reinvested for periods ended 9/30/97)                       

New Perspective Fund has done significantly better than most other similar      
mutual funds. Over its lifetime, the fund ranked second among the five global   
equity funds in existence over this 24 1/2-year span, according to Lipper       
Analytical Services. Here is how the fund ranks over other time periods:        

*  10 years:    4th out of 18 global equity funds                               
*  5 years:     9th out of 44 global equity funds                               
*  1 year:      41st out of 170 global equity funds                             

Lipper rankings are based on total return and do not reflect the effect of      
sales charges.                                                                  

[begin chart]                                                                   
HOW A $10,000 INVESTMENT HAS GROWN                                              

$300,835/1,2/                                                                   
New Perspective Fund with dividends reinvested                                  

$199,607                                                                        
MSCI USA Index with dividends reinvested                                        

$163,819                                                                        
MSCI World Index with dividends reinvested                                      

$10,000/1/                                                                      
original investment                                                             

                                                                [Download Table]

           New                                                     
           Perspective                                             
Year       Fund                              MSCI USA    MSCI World
ended      TOTAL VALUE                       Index with  Index with
September  Dividends    Value at     Total   dividends   dividends 
30         Reinvested   year-end/1/  Return  reinvested  reinvested
                                                                   
1973#      -            $9,938       (0.6)%  9,644       9,496     
1974       $325         7,402        (25.5)  5,796       5,886     
1975       401          10,769       45.5    7,954       7,647     
1976       337          12,720       18.1    10,379      9,328     
1977       280          13,050       2.6     9,925       9,685     
1978       318          17,342       32.9    10,953      11,895    
1979       444          20,100       15.9    12,042      13,362    
1980       501          24,866       23.7    14,200      15,945    
1981       931          25,315       1.8     13,948      14,919    
1982       1,667        27,151       7.3     15,458      15,314    
1983       1,830        39,093       44.0    22,064      21,629    
1984       1,205        39,494       1.0     23,019      22,861    
1985       1,196        45,578       15.4    26,527      28,617    
1986       1,178        63,273       38.8    34,776      45,581    
1987       1,393        94,727       49.7    49,353      65,809    
1988       1,820        81,233       (14.2)  42,818      61,905    
1989       2,605        103,968      28.0    56,868      77,872    
1990       2,617        98,896       (4.9)   52,008      61,430    
1991       2,979        122,493      23.9    68,580      76,958    
1992       2,524        132,337      8.0     76,198      76,629    
1993       2,172        156,604      18.3    86,165      92,637    
1994       2,231        176,345      12.6    89,637      100,116   
1995       2,813        209,200      18.6    117,232     115,102   
1996       4,129        231,461      10.6    142,355     131,445   
1997       4,365        300,835      30.0    199,607     163,819   

Average annual compound return for 24-1/2 years   14.9% /1/                     

# For the period March 13, 1973 (commencement of operations) through September  
30, 1973.                                                                       

/1/These figures, unlike those shown elsewhere in this report, reflect payment  
of the maximum sales charge of 5.75% on the $10,000 investment. Thus, the net   
amount invested was $9,425. As outlined in the prospectus, the sales charge is  
reduced for larger investments. The maximum intitial sales charge was 8.5%      
prior to July 1, 1988. There is no sales charge on dividends or capital gain    
distributions that are reinvested in additional shares. No adjustment has been  
made for income or capital gain taxes.                                          

/2/Includes reinvested dividends of $40,261 and reinvested capital gain         
distributions of $80,243.                                                       

Past results are not predictive of future results.                              

AVERAGE ANNUAL COMPOUND RETURNS*                                                
(for periods ended September 30, 1997)                                          

10 Years   +11.59%                                                              
5 Years    +16.46%                                                              
1 Year     +22.52%                                                              

*Assumes reinvestment of all distributions and payment of 5.75% sales charge at 
the beginning  of the stated periods.                                           
[end chart]                                                                     

CAPITALIZING ON CHANGE                                                          
A NEW PERSPECTIVE ON THE GLOBAL ECONOMY                                         

New Perspective Fund was created nearly 25 years ago with an unusual mandate:   
to seek out investment opportunities presented by changes in international      
trade and in economic and political relationships. The strategy was a prescient 
one. The last few decades have seen borders open, free trade and free           
enterprise flourish, economies expand and the concept of investing globally     
gain wide acceptance to a degree we could not have anticipated back in 1973.    

   Several trends have converged to ease the way. A wave of economic freedom
and a reduction in government control have allowed private investment to        
finance growth. Trade pacts and worldwide deregulation have helped erase        
borders. Bolstering these forces is a quickening of innovation, particularly in 
technology, that is creating entire industries that did not exist when New      
Perspective Fund began.                                                         

  Many companies have been alert to the potential rewards of globalization
and benefited tremendously from it. With economic prosperity raising living     
standards for more people around the world than at any time in history,         
businesses that serve world markets have both fueled this growth and been among 
its biggest beneficiaries.                                                      

    New Perspective's investment professionals also use a global approach when
they look for investments for the fund. The fund's investment adviser, Capital  
Research and Management Company, has had an international presence for more     
than 35 years. What began as a single office in Geneva has grown today into one 
of the industry's most comprehensive global research networks, supported by     
more than 100 analysts and portfolio counselors.                                

Of course, other investment firms have offices around the world. What 
makes New Perspective unique is an integrated research process that allows      
investment professionals to develop a broad base of knowledge and expertise.    
It's a process that demands constant dialogue and a continuous exchange of      
information and ideas. We believe those insights help us make better long-term  
investment decisions on your behalf.                                            

 On the next few pages, we'll examine three industries that have adapted
particularly well to globalization and explain how our analysts have gone about 
identifying them and their potential value as long-term investments. The        
telecommunications, information technology and pharmaceuticals industries are   
well-represented in New Perspective Fund. (Companies shown in BOLDFACE on first 
reference are current holdings in the fund. Of course, the fund's portfolio is  
actively managed and holdings may change.) These businesses are offering new    
services, developing new products and tapping into new markets.                 

[photo: telephone conversation via computer monitor]                            
[Begin photo caption]                                                           
TELECOMMUNICATIONS                                                              
[End photo caption]                                                             

[photo: pharmaceutical lab technician]                                          
[Begin photo caption]                                                           
PHARMACEUTICALS                                                                 
[End photo caption]                                                             

[photo: microchip]                                                              
[Begin photo caption]                                                           
INFORMATION TECHNOLOGY                                                          
[End photo caption]                                                             

[photo: conical shape of globe]                                                 

[Begin sidebar]                                                                 
With a new customer added about every 20 seconds, wireless service is one of    
the fastest growing areas in telecommunications and another way telephone       
companies add value. New Perspective's research analysts can add value, too, by 
uncovering attractive investment opportunities at just the right time. When     
AIRTOUCH COMMUNICATIONS entered into a joint venture with the German            
conglomerate MANNESMANN, Brad Vogt, a research analyst based in Washington,     
D.C., was intrigued.  "I had been covering AirTouch for some time," he says,    
"and it was clear that this was a good opportunity for the company to make use  
of its expertise in overseas markets."                                          

[photo: telephone conversation via computer monitor]                            

   Because Brad focuses mostly on U.S. companies, however, he felt he needed
a broader perspective before he could be certain about whether the investment   
made sense. After carefully studying the details of the partnership, he talked  
to David Riley, who covers European telecommunications companies, and Ursula    
Van Almsick, a London-based analyst who covers Mannesmann, to see what they     
thought. They compared notes and, based on their input on European companies    
and industry trends, Brad felt confident that AirTouch stock was undervalued    
and recommended it for New Perspective Fund. Since then, the venture, called    
Mannesmann Mobilfunk, has attracted more than 2 million subscribers and has     
helped make AirTouch and Mannesmann two very good investments for the fund.     
[End sidebar]                                                                   

TELECOMMUNICATIONS                                                              
NEW SERVICES FOR GLOBAL COMPANIES                                               

   With the technology to reach every corner of the world in the blink of an
eye, perhaps no industry is more emblematic of the potential of globalization   
than telecommunications services.                                               

    Although the telephone has been helping people stay in touch for more than
a century, its potential has only begun to be realized. Not long ago, AT&T'S    
decades-long monopoly on U.S. services and equipment seemed unassailable, and   
the majority of overseas phone companies were bureaucratic, state-run           
operations. Without competition, phone service around the world tended to be    
slow, expensive or simply nonexistent.                                          

 Today, the telecommunications landscape could not be more different. Ma
Bell's dominance in the U.S. crumbled in 1984. The Telecommunications Act of    
1996 brought added competition to the market by allowing regional phone         
companies to broaden the range of services they could provide to customers. The 
U.S. government has been auctioning off billions of dollars in licenses for     
parts of the frequency spectrum for wireless services.                          

In Europe, barriers to competition that had protected the continent's 
telecommunications groups for more than a century will be demolished as early   
as January 1, 1998. Developing markets that had virtually no phone service two  
decades ago are now hastily building infrastructures that will accommodate      
wireless technology and Internet access. Innovation and industrywide            
deregulation have allowed competition to take its course, forcing companies to  
become more efficient and customer-oriented.                                    

These changes have made telecommunications companies attractive       
investments as well. New Perspective Fund had no telecommunications holdings    
until 1983. Today, thanks in no small part to the potential offered by global   
growth and worldwide deregulation, telecommunications is our second largest     
industry concentration, with 16 companies based in 12 countries.                

   David Riley, an NPF research analyst based in Geneva, is impressed by how
effectively some telecommunications companies are taking advantage of the new   
open environment.  "To borrow a biblical term, globalization begets             
globalization," he says.  "As businesses have expanded their borders of         
operations, they have demanded increasingly sophisticated, reliable services.   
Phone companies have responded by becoming more global themselves."             

    David cites as examples a number of global partnerships formed by regional
and long distance service providers. A joint venture called Concert, involving  
BRITISH TELECOM and MCI, has recently linked up with TELEFONICA DE ESPANA to    
facilitate access to Spain and Latin America. Likewise, DEUTSCHE TELEKOM has    
joined France Telecom and SPRINT in a venture called Global One, while AT&T has 
partnered with the Netherlands' KPN, Swiss PTT and Telia of Sweden to enhance   
services for its multinational customers. These companies are offering their    
clients faster, cheaper connections, new data services and simplified billing.  

 Research is critical in a complex industry such as this one. The fund's
analysts make it their business to get to know every telecommunications company 
very well, whether we invest in it or not. Their research typically crosses     
geographic borders, which can help an analyst determine what companies are      
worth on a relative basis. David, for example, follows European companies and   
has recently added Latin America to his area of coverage. Keeping Mexican or    
Brazilian valuations in mind when evaluating British or Italian businesses has  
helped him make better investment recommendations.                              

Although David spends a lot of time studying companies on his own, his
work isn't done until he's talked with other Capital associates with relevant   
areas of expertise (see story above). Working in "cluster groups" helps         
analysts leverage their many hours of research and close the circle of          
information. That knowledge makes a difference with the companies we invest in, 
too. As David says, "When Capital's analysts call on them, companies will take  
the time to talk to us. In fact, because we've done our homework so thoroughly, 
management will frequently call us with information they feel is important for  
their shareholders."                                                            

[photo: cables]                                                                 
[sketch of globe cutouts]                                                       

[photo:  Telefonica de Espana, Spain]                                           
[Begin photo caption]                                                           
Telefonica de Espana, Spain                                                     
[End photo caption]                                                             

[photo:  Telefonos de Mexico]                                                   
[Begin photo caption]                                                           
Telefonos de Mexico                                                             
[End photo caption]                                                             

INFORMATION TECHNOLOGY                                                          
NEW MARKETS FOR GLOBAL INNOVATION                                               

 If telecommunications has ridden the wave of the global explosion, then
information technology has been its catalyst, the element that has made it all  
possible. Technological innovation has helped create new industries, change the 
way every business is run and transform developing economies into pacesetters.  

   The market for information technology is expanding rapidly. Companies are
spending large sums to upgrade their computer systems, while more people than   
ever are buying personal computers for home use. The fastest growth is          
occurring outside the U.S., particularly in the Asia/Pacific region, where      
improving economic conditions helped propel PC sales 30% higher last year.      
China, South Korea and India have presented significant opportunities for       
global companies that can meet the demands of their international customers.    

Today, U.S.-based technology companies, which dominate the industry,  
derive up to half of their revenues from markets outside the United States, by  
some estimates. Many global technology firms operate manufacturing facilities   
in the countries they service. Trade pacts have helped globalize the industry   
as well; several countries have recently agreed to end all tariffs on           
information technology products by the year 2000.                               

  The industry is complex and interdependent. Where manufacturers like IBM
once made all the parts they needed to assemble a complete computer, companies  
now typically produce only one or a few components. Scott Bonham, a research    
analyst based in San Francisco, notes that "outsourcing, which has become       
popular across many industries, has completely changed the dynamics of the      
information technology sector. That applies across the board. Whether it's      
giant mainframes, tiny silicon wafers or ancillary consulting services, people  
want to benefit from technology, not manage it." He points out that today       
computer makers rely on other firms to supply the "guts" of the machine -       
companies such as INTEL and ADVANCED MICRO DEVICES for microprocessors, which   
coordinate the flows of information within the computer; MICRON TECHNOLOGY for  
powerful memory chips that store huge amounts of data; SEAGATE for disk drives; 
and CISCO SYSTEMS and ASCEND for high-speed data networking systems that allow  
computers to communicate with each other.                                       

Of course, information technology has other applications. Chips  and  
circuits are used to make and operate automobiles, machinery, movies and        
countless electronic devices. What's more, much of the best innovation comes    
not from the technology industry but from forward-looking businesses hoping to  
increase their market share. They include firms such as NOKIA and ERICSSON,     
which pioneered cellular phone technology.                                      

  Technology companies fit together like pieces of a global jigsaw puzzle.
That makes understanding them - and investing in them - a complicated           
enterprise. Integrated research helps the fund's analysts develop a             
comprehensive understanding of this highly specialized industry.                

   New Perspective Fund's technology cluster comprises six analysts. Working
as a team, they travel together, share information at weekly teleconferences    
and write frequent reports on the companies they cover.  "The constant          
interplay of perspectives is essential to the research process," stresses       
Scott.  "Without it, it's like using an encyclopedia with $A' through $M'       
missing."                                                                       

[photo: Nokia, Finland]                                                         
[Begin photo caption]                                                           
Nokia, Finland                                                                  
[End photo caption]                                                             

[photo:  Advanced Micro Devices, U.S.                                           
K6 microprocessor]                                                              
[Begin photo caption]                                                           
Advanced Micro Devices, U.S.                                                    
K6 microprocessor                                                               
[End photo caption]                                                             

[photo: close-up of microchip]                                                  
[photo: electronic component]                                                   

[Begin sidebar]                                                                 
Fundamental research can be a time-consuming, laborious process, but we think   
it's worth the effort: After all, keeping a long-term focus is one of New       
Perspective Fund's guiding principles. Sung Lee, a technology analyst based in  
Tokyo, was inspired by an article he read about the impending deregulation of   
Japan's financial industry. Realizing that these companies would have to make   
tremendous investments in information technology to stay competitive, he        
compiled a list of several technology companies that might benefit. Sung        
crunched some numbers and came up with Fujitsu, the world's second-largest      
computer manufacturer, as a likely candidate.                                   

 At that point, however, Sung's work had just begun. He began to hit the
streets, meeting with every division head at Fujitsu, visiting the company's    
U.S. subsidiaries and calling on dozens of customers and competitors. All the   
while, he consulted with the fund's technology cluster at the group's weekly    
teleconference to gain additional insights and put his information in a broader 
context. Finally, after several weeks of painstaking research, Sung was         
convinced that Fujitsu would be a good long-term holding for the fund and made  
his recommendation.  "Spending time on research can sometimes cost you          
short-term gains," he concedes, "but I think it helps you reap the real         
benefits down the line."                                                        
[End sidebar]                                                                   

NEW PRODUCTS FOR GLOBAL HEALTH                                                  
PHARMACEUTICALS                                                                 

[sketch of globe cutouts]                                                       
[photo: phamaceutical lab technician]                                           

   Unlike telephones and computers, which are relatively recent innovations,
the use of plants or minerals for medicinal purposes goes back to ancient       
times. In many ways, however, the drug industry is just as "new" as the other   
two industries, reinvented by the remarkable advances the global economy has    
wrought.                                                                        

Many factors have contributed to the growth of the pharmaceutical     
industry. Baby boomers will increasingly require drugs for ailments of age such 
as cancer, Alzheimer's, cardiovascular disease and depression. Health care      
providers, under pressure to trim budgets, have turned to cost-effective drugs  
to prevent disease and hasten their cure. Breakthrough treatments like          
com-bination therapy for HIV/AIDS are gaining wider acceptance. Regulatory      
agencies have made enormous strides in shortening approval times, which allows  
new drugs to be brought to market faster. But perhaps the greatest stimulus is  
the most obvious one.  "Everyone wants to live," states Jonathan Knowles, a     
pharmaceutical analyst based in London.  "Drugs help you stay alive."           

    "The largest drug concerns," says Jonathan, "NOVARTIS, MERCK and JOHNSON &
JOHNSON, to name just a few, are truly multinational. Technically, they may be  
based in one country, but in reality they serve a world market." He mentions    
GLAXO WELLCOME, which recently performed clinical trials on its new hepatitis   
drug in China, where incidence of the disease is quite high. Another example is 
PFIZER, which partnered with a Croatian firm to develop one of the world's      
best-selling antibiotics. In addition to opening doors to potential profits,    
globalization also helps companies leverage the resources they need to bring    
new medicines to market, which can run to $500 million and perhaps a decade of  
research and development for a single product. That investment is imperative.   
In the highly competitive world of pharmaceuticals, companies that do not       
continuously develop innovative products simply cannot thrive.                  

Research, the lifeblood of the pharmaceutical industry, is also the   
cornerstone of New Perspective Fund's investment strategy. Like the fund's      
other health care analysts, Jonathan pays close attention to drug "pipelines"   
to monitor their progress.  "Because so many things can change along the way,"  
he says, "you have to make constant assessments of how a product is moving      
through the system." Not long ago, he was following the development of an       
environmentally safe fungicide that ZENECA was planning to launch.  "We started 
tracking it a while back. On successive visits, we could see that their R&D     
people were getting more and more excited about the possibilities. This         
chemical has recently been launched and is doing extremely well."               

Analysts who follow pharmaceutical companies are part of a health care
cluster that includes a bond specialist who provides yet another perspective to 
the group. In all, the cluster has seven analysts covering biotechnology,       
hospitals, managed care facilities and medical supplies, in addition to         
pharmaceuticals. Such collaboration is particularly helpful in an industry that 
crosses so many borders.                                                        

The analysts also benefit from the vast experience of New Perspective 
Fund's investment adviser.  "Capital's pedigree is remarkable in the investment 
world," notes Jonathan.  "Our organization has been visiting many of these      
pharmaceutical companies for 15 or 20 years." That history, combined with the   
continuous, intensive research of the fund's investment professionals, provides 
a depth of knowledge that is virtually unmatched in the industry.               

[photo: Novartis, Switzerland]                                                  
[Begin photo caption]                                                           
Novartis, Switzerland                                                           
[End photo caption]                                                             

[photos: Astra Research Center]                                                 
[Begin photo caption]                                                           
Astra, Sweden                                                                   
Astra Research Center, Boston, Massachusetts                                    
(above and right)                                                               
[End photo caption]                                                             

[Begin sidebar]                                                                 
Drug companies frequently find success by looking for unorthodox solutions to   
difficult problems. When it comes to researching pharmaceutical firms, New      
Perspective Fund's analysts often have to be creative as well.                  

Sankyo was developing a novel treatment for type 2 diabetes in Japan, 
where the condition is prevalent. Lacking sufficient distribution channels for  
overseas markets, the company had licensed the drug jointly to Glaxo Wellcome   
and Warner-Lambert. Unfortunately, information about the drug was extremely     
hard to come by. Richard Beleson, an analyst based in San Francisco, had a long 
relationship with Warner-Lambert. During his visits to the company, he paid     
close attention to the drug's pipeline on the U.S. side. He was encouraged by   
what he saw.  "It was apparent from clinical trials that were being performed   
here that this was going to be an extremely important product for all three     
companies involved," he says. Richard shared his insights with Jonathan         
Knowles, who follows European pharmaceuticals, and other Capital analysts. The  
drug is off to a great start. Launched earlier this year, it has already        
generated more than $250 million in sales worldwide.                            
[End sidebar]                                                                   

                                                        [Enlarge/Download Table]
                                                                                                    
New Perspective Fund                                                                                
Investment Portfolio, September 30, 1997                                                            

Largest Industry Holdings                                                                           
10.26% Health & Personal Care                                                                       
7.63% Telecommunications                                                                            
6.71% Banking                                                                                       
5.58% Electronic Components                                                                         
5.30% Broadcasting & Publishing                                                                     
52.93% Other Industries                                                                             
11.59% Bonds, Cash and Equivalents                                                                  

                                                              Shares or        Market      Percent  
                                                              Principal         Value        of Net 
Equity-Type Securities                                           Amount    (Millions)        Assets 
-----------------------------------------                  ------------  ------------  ------------ 

Health & Personal Care - 10.26%                                                                     
AB Astra, Class A (Sweden)                                    11,826,833      $218.798              
AB Astra, Class A (American Depositary Receipts)                 413,333         7.595              
AB Astra, Class B                                              8,590,533       152.115         2.23 
Novartis AG (Switzerland)                                        231,231       355.470         2.10 
Pfizer Inc (USA)                                               4,870,000       292.505         1.73 
Teva Pharmaceutical Industries Ltd. (American Depositary                                            
 Receipts) (Israel)                                            2,400,000       133.800          .79 
SmithKline Beecham PLC (American Depositary Receipts)                                               
 (United Kingdom)                                              2,200,000       107.525          .63 
Merck & Co., Inc. (USA)                                          880,000        87.945          .52 
Glaxo Wellcome PLC (United Kingdom)                              563,264        12.678              
Glaxo Wellcome PLC (American Depositary Receipts)                854,000        38.377          .30 
Zeneca Group PLC (United Kingdom)                              1,000,000        32.627              
Zeneca Group PLC (American Depositary Receipts)                  185,000        18.095          .30 
Shiseido Co., Ltd. (Japan)                                     2,924,000        47.075          .28 
Johnson & Johnson (USA)                                          800,000        46.100          .27 
Genentech, Inc., callable putable common stock (USA) (1)         600,000        34.875          .21 
Sankyo Co., Ltd. (Japan)                                       1,000,000        34.689          .20 
Alza Corp. (USA) (1)                                           1,000,000        29.000          .17 
Abbott Laboratories (USA)                                        400,000        25.575          .15 
Pharmacia & Upjohn, Inc. (USA)                                   500,000        18.250          .11 
Gillette Co. (USA)                                               203,400        17.556          .10 
Guidant Corp. (USA)                                              300,000        16.800          .10 
Medtronic, Inc. (USA)                                            255,000        11.985          .07 

Telecommunications - 7.63%                                                                          
Telefonica de Espana, SA (Spain)                               7,906,000       249.523              
Telefonica de Espana, SA (American Depositary Receipts)           76,000         7.153         1.51 
Telecom Italia SPA, ordinary shares (formerly STET-Societa                                          
 Finanziaria Telefonica p.a.) (Italy)                         20,190,000       135.280              
Telecom Italia SPA, nonconvertible                                                                  
 savings shares                                               16,500,000        64.457         1.18 
Telefonos de Mexico, SA de CV, Class L (American                                                    
 Depositary Receipts) (Mexico)                                 3,134,530       162.212          .96 
AirTouch Communications (USA) (1)                              3,500,000       124.031          .73 
Telecom Corp. of New Zealand Ltd. (New Zealand)               13,678,100        69.386              
Telecom Corp. of New Zealand Ltd. (2)                          5,135,400        26.051          .56 
Vodafone Group PLC (American Depositary Receipts) (United                                           
 Kingdom)                                                      1,428,500        76.782          .45 
Tele Danmark AS, Class B (Denmark)                               672,000        35.463              
Tele Danmark AS, Class B (American Depositary Receipts)        1,233,700        32.924          .40 
MCI Communications Corp. (USA)                                 2,325,000        68.297          .40 
AT&T Corp. (USA)                                               1,535,000        68.020          .40 
Koninklijke PTT Nederland NV (Netherlands)                     1,629,500        64.208          .38 
Sprint Corp. (USA)                                               883,400        44.170          .26 
Hong Kong Telecommunications Ltd. (Hong Kong)                  8,260,529        18.684              
Hong Kong Telecommunications Ltd. (American Depositary                                              
 Receipts)                                                       440,759         9.862          .17 
British Telecommunications PLC (United Kingdom)                3,000,000        19.828          .12 
Telecomunicacoes Brasileiras SA, preferred                                                          
 nominative (American Depositary Receipts) (Brazil)               76,439         9.841          .06 
Deutsche Telekom AG (Germany)                                    265,900         5.160          .03 
DDI Corp. (Japan)                                                    500         2.515          .02 

Banking - 6.71%                                                                                     
Royal Bank of Canada (Canada)                                  3,717,000       182.689         1.08 
Bank of Nova Scotia (Canada)                                   3,129,500       149.962          .88 
Westpac Banking Corp. (Australia)                             17,567,630       110.731              
Westpac Banking Corp., warrants, expire 2000 (1)               3,000,000        15.867          .75 
BankAmerica Corp. (USA)                                        1,250,000        91.641          .54 
Citicorp (USA)                                                   600,000        80.362          .47 
Banco de Santander, SA (Spain)                                 1,800,000        59.233              
Banco de Santander, SA (American Depositary Receipts)            540,000        17.617          .45 
Australia and New Zealand Banking Group Ltd. (Australia)       7,371,411        60.242          .36 
Cie. Financiere de Paribas, Class A (France)                     750,000        55.781          .33 
Banque Nationale de Paris (France)                             1,021,549        51.613          .30 
Chase Manhattan Corp. (USA)                                      375,000        44.250          .26 
Fuji Bank, Ltd. (Japan)                                        3,710,000        40.948          .24 
Sumitomo Bank, Ltd. (Japan)                                    2,300,000        34.739          .21 
ABN AMRO Holding NV (Netherlands)                              1,672,960        33.972          .20 
Sakura Bank, Ltd. (Japan)                                      6,675,000        31.962          .19 
The Toronto-Dominion Bank (Canada)                               750,000        25.489          .15 
Bank of Tokyo-Mitsubishi, Ltd. (Japan)                         1,250,000        23.859          .14 
Istituto Mobiliare Italiano SpA (Italy)                        1,500,000        16.064          .09 
HSBC Holdings PLC (United Kingdom)                               320,000        11.365          .07 

Electronic Components - 5.58%                                                                       
Micron Technology, Inc. (USA) (1)                              6,855,000       237.783         1.40 
Advanced Micro Devices, Inc. (USA) (1)                         6,050,000       197.003         1.16 
Intel Corp. (USA)                                              1,400,000       129.237          .76 
Bay Networks, Inc. (USA) (1)                                   3,000,000       115.875          .68 
Analog Devices, Inc. (USA) (1)                                 1,710,000        57.285          .34 
Arrow Electronics, Inc. (USA) (1)                                880,000        51.040          .30 
Seagate Technology (USA) (1)                                   1,400,000        50.575          .30 
Altera Corp. (USA) (1)                                           950,000        48.687          .29 
Murata Manufacturing Co., Ltd. (Japan)                           590,000        25.559          .15 
Electrocomponents PLC (United Kingdom)                         3,000,000        22.273          .13 
Kyocera Corp. (Japan)                                            176,000        11.524          .07 

Broadcasting & Publishing - 5.30%                                                                   
Time Warner Inc. (USA)                                         6,406,225       347.137         2.05 
Viacom Inc., Class B (USA) (1)                                 4,640,000       146.740          .87 
News Corp. Ltd. (Australia)                                    3,948,625        20.246              
News Corp. Ltd. (American Depositary Receipts)                 3,991,600        81.578              
News Corp. Ltd., preferred shares                              2,021,244         8.947              
News Corp. Ltd., preferred shares (American Depositary                                              
 Receipts)                                                     1,995,800        35.800          .86 
CANAL + (France)                                                 267,145        47.595          .27 
Carlton Communications PLC (United Kingdom)                    4,890,000        40.607          .24 
Grupo Televisa, SA, ordinary participation certificates                                             
 (American Depositary Receipts) (Mexico) (1)                     825,000        29.545          .17 
Westinghouse Electric Corp. (USA)                              1,045,000        28.280          .17 
Elsevier NV (Netherlands)                                      1,700,000        24.756          .15 
Wolters Kluwer NV (Netherlands)                                  162,516        21.979          .13 
Pearson PLC (United Kingdom)                                   1,700,000        21.498          .13 
Dow Jones & Co., Inc. (USA)                                      434,900        20.331          .12 
AUDIOFINA (Luxembourg)                                           415,300        16.707          .10 
U S WEST Media Group (USA) (1)                                   313,300         6.990          .04 
                                                                      .                             

Energy Sources - 4.76%                                                                              
TOTAL, Class B (France)                                          131,077        15.044              
TOTAL, Class B (American Depositary Receipts)                  3,109,814       178.231         1.14 
Royal Dutch Petroleum Co. (New York Registered                                                      
 Shares) (Netherlands)                                         1,852,000       102.786              
 'Shell' Transport and Trading Co., PLC (United Kingdom)       3,000,000        21.958          .74 
Broken Hill Proprietary Co. Ltd. (Australia)                   6,502,053        75.749          .45 
ENI SpA (Italy)                                               11,000,000        69.448          .41 
Elf Aquitaine (France)                                           400,000        53.550              
Elf Aquitaine (American Depositary                                                                  
 Receipts)                                                       100,000         6.669          .35 
Phillips Petroleum Co. (USA)                                   1,100,000        56.788          .33 
Anadarko Petroleum Corp. (USA)                                   700,000        50.269          .30 
Talisman Energy Inc. (Canada) (1)                              1,400,000        48.237          .28 
YPF SA, Class D (American Depositary Receipts (Argentina)      1,200,000        44.250          .26 
Mobil Corp. (USA)                                                500,000        37.000          .22 
RAO Gazprom (American Depositary Receipts) (Russia)            1,341,000        33.659          .20 
Enterprise Oil PLC (United Kingdom)                            1,221,300        13.355          .08 
                                                                      .                             

Electrical & Electronics - 4.58%                                                                    
Nokia Corp., Class A (Finland)                                   480,000        45.693              
Nokia Corp., Class A (American Depositary Receipts)            1,450,000       136.028              
Nokia Corp., Class K                                             460,000        43.615         1.33 
Telefonaktiebolaget LM Ericsson, Class B (Sweden)              2,376,000       114.444              
Telefonaktiebolaget LM Ericsson, Class B (American                                                  
 Depositary Receipts)                                            800,000        38.350          .90 
ABB AB, Class A (Sweden)                                         150,000         2.131              
ABB AB, Class B                                                6,000,000        84.836              
ABB AB, Class B (American Depositary Receipts)                   250,000        35.375              
ABB AG, Class A (Switzerland)                                     11,750        17.350          .82 
Northern Telecom Ltd. (Canada)                                   457,300        47.530          .28 
Schneider SA (France)                                            750,000        47.477          .28 
Siemens AG (Germany)                                             600,000        40.637          .24 
Alcatel Alsthom (France)                                         260,000        34.675          .21 
York International Corp. (USA)                                   680,000        30.430          .18 
General Electric Co. (USA)                                       394,000        26.817          .16 
NextLevel Systems, Inc. (USA) (1)                              1,055,200        17.675          .10 
Lucent Technologies Inc. (USA)                                   168,523        13.713          .08 
                                                                      .                             

Multi-Industry - 4.17%                                                                              
Siebe PLC (United Kingdom)                                     6,570,000       132.391          .78 
Hutchison Whampoa Ltd. (Hong Kong)                            13,281,000       130.884          .77 
Lend Lease Corp. Ltd. (Australia)                              4,058,860        96.427          .57 
FMC Corp. (USA) (1)                                              991,300        87.978          .52 
Williams Holdings PLC (United Kingdom)                        10,000,000        59.557          .35 
LTV Corp. (USA)                                                4,225,000        53.605          .32 
Suez Lyonnaise des Eaux (France)                                 390,243        43.668          .26 
Canadian Pacific Ltd. (Canada)                                 1,000,000        29.563          .17 
Lagardere Groupe SCA (France)                                    700,000        22.280          .13 
AlliedSignal Inc. (USA)                                          400,000        17.000          .10 
B.A.T Industries PLC (United Kingdom)                          1,895,559        16.613          .10 
Swire Pacific Ltd., Class A (Hong Kong)                        2,150,000        16.464          .10 
                                                                      .                             

Automobiles - 3.63%                                                                                 
Honda Motor Co., Ltd. (Japan)                                  4,640,000       162.111          .96 
Regie Nationale des Usines Renault, SA (France)                3,800,000       112.985          .67 
Bayerische Motoren Werke AG (Germany)                             69,500        59.336              
Bayerische Motoren Werke AG, preferred shares                     20,318        11.830          .42 
Ford Motor Co., Class A (USA)                                  1,229,500        55.635          .33 
Chrysler Corp. (USA)                                           1,500,000        55.219          .33 
Toyota Motor Corp. (Japan)                                     1,405,000        43.141          .25 
Suzuki Motor Corp. (Japan)                                     3,600,000        34.656          .20 
Volvo AB, Class B (Sweden)                                     1,000,000        28.741          .17 
General Motors Corp. (USA)                                       400,000        26.775          .16 
Daimler-Benz AG, 4.125% convertible debentures 2003                                                 
 (Germany) (2)                                             DM28,000,000         24.311          .14 

Beverages & Tobacco - 3.42%                                                                         
Philip Morris Companies Inc. (USA)                             7,455,000       309.848         1.83 
Asahi Breweries, Ltd. (Japan)                                  4,060,000        65.364              
Asahi Breweries, Ltd., 1.00% convertible debentures 2003   Y924,000,000         12.844              
Asahi Breweries, Ltd., .95% convertible debentures 2002    Y410,000,000          5.682              
Asahi Breweries, Ltd., .90% convertible debentures 2001    Y520,000,000          7.168          .54 
Seagram Co. Ltd. (Canada)                                      2,200,000        77.550          .46 
PepsiCo, Inc. (USA)                                            1,000,000        40.563          .24 
Cia. Cervejaria Brahma (Brazil)                               47,000,000        36.108          .21 
LVMH Moet Hennessy Louis Vuitton (France)                         55,000        11.723          .07 
Lion Nathan Ltd. (New Zealand)                                 3,218,800         7.875          .04 
Gallaher Group PLC (American Depositary Receipts)                                                   
 (United Kingdom)                                                300,000         5.756          .03 

Machinery & Engineering - 3.40%                                                                     
Caterpillar Inc. (USA)                                         4,600,000       248.113         1.46 
Mannesmann AG (Germany)                                          507,500       242.490         1.43 
Deere & Co. (USA)                                                725,000        38.969          .23 
Kvaerner AS, Class A (Norway)                                    535,340        31.663          .19 
Kawasaki Heavy Industries, Ltd. (Japan)                        4,200,000        14.534          .09 

Chemicals - 3.20%                                                                                   
Praxair, Inc. (USA)                                            2,639,300       135.099          .80 
Georgia Gulf Corp. (USA) (3)                                   1,975,000        60.484          .36 
Sherwin-Williams Co. (USA)                                     1,962,000        57.756          .34 
Methanex Corp. (Canada)                                        6,250,000        52.479          .31 
Nan Ya Plastics Corp. (Taiwan)                                19,980,000        47.921          .28 
E.I. du Pont de Nemours and Co. (USA)                            600,000        36.938          .22 
Valspar Corp. (USA)                                            1,160,000        36.395          .21 
AGA AB, Class A (Sweden)                                       1,460,000        24.020              
AGA AB, Class B                                                  550,000         8.867          .19 
Bayer AG (Germany)                                               750,000        29.941          .18 
L'Air Liquide (France)                                           110,097        18.163          .11 
BOC Group PLC (United Kingdom)                                 1,000,000        17.827          .10 
Engelhard Corp. (USA)                                            813,100        17.533          .10 

Food & Household Products - 3.13%                                                                   
Nestle SA (Switzerland)                                           89,782       125.395          .74 
Cadbury Schweppes PLC (United Kingdom)                        10,865,090       104.604          .62 
Reckitt & Colman PLC (United Kingdom)                          6,056,250        93.007          .55 
Unilever NV (Netherlands)                                        335,000        71.706              
Unilever PLC (United Kingdom)                                    660,000        19.318          .54 
Groupe Danone (France)                                           443,586        70.107          .41 
Archer Daniels Midland Co. (USA)                               1,050,000        25.134          .15 
Colgate-Palmolive Co. (USA)                                      300,000        20.906          .12 

Data Processing & Reproduction - 2.54%                                                              
Fujitsu Ltd. (Japan)                                           7,172,000        89.873          .53 
Ascend Communications, Inc. (USA) (1)                          1,850,000        59.894          .35 
Silicon Graphics, Inc. (USA) (1)                               2,100,000        55.125          .32 
Oracle Corp. (USA) (1)                                         1,425,000        51.923          .31 
Acer Inc. (Taiwan) (1)                                        20,000,000        39.216          .23 
Sybase, Inc. (USA) (1)                                         1,850,000        33.300          .20 
International Business Machines Corp. (USA)                      300,000        31.781          .19 
Computer Associates International, Inc. (USA)                    261,500        18.779          .11 
Microsoft Corp. (USA) (1)                                        140,000        18.524          .11 
Digital Equipment Corp. (USA) (1)                                400,000        17.325          .10 
Cisco Systems, Inc. (USA) (1)                                    200,000        14.613          .09 

Insurance - 2.46%                                                                                   
ING Groep NV (formerly Internationale Nederlanden Groep)                                            
 (Netherlands)                                                 4,376,336       201.550         1.19 
Fairfax Financial Holdings Ltd. (Canada)                         234,700        65.067              
Fairfax Financial Holdings Ltd. (USA) (2)                         93,000        25.783          .54 
American International Group, Inc. (USA)                         774,843        79.954          .47 
Societe Centrale des Assurances Generales de France (Franc       735,000        29.196          .17 
Assicurazioni Generali SpA (Italy)                               670,000        15.098          .09 

Forest Products & Paper - 2.01%                                                                     
Champion International Corp. (USA)                             2,200,000       134.063          .79 
Louisiana-Pacific Corp. (USA)                                  2,550,000        63.750          .38 
UPM-Kymmene Corp. (Finland)                                    1,953,000        54.332          .32 
International Paper Co. (USA)                                    600,000        33.038          .19 
Rayonier Inc. (USA)                                              600,000        29.025          .17 
Jefferson Smurfit Corp. (USA) (1)                              1,255,700        25.114          .15 
Carter Holt Harvey Ltd. (New Zealand)                          1,058,500         2.298          .01 

Gold Mines - 1.88%                                                                                  
Newmont Mining Corp. (USA)                                     2,750,000       123.578          .73 
Placer Dome Inc. (Canada)                                      5,500,000       105.188          .62 
Barrick Gold Corp. (Canada)                                    2,500,000        61.875          .36 
Gold Fields of South Africa Ltd. (South Africa)                1,400,000        28.195          .17 

Metals: Nonferrous - 1.78%                                                                          
Aluminum Co. of America (USA)                                    950,000        77.900          .46 
WMC Ltd. (Australia)                                          15,389,336        72.249          .43 
Alumax Inc. (USA) (1)                                          1,500,000        61.313          .36 
Alcan Aluminium Ltd. (Canada)                                  1,700,000        59.075          .35 
Pechiney, Class A (France)                                       366,527        17.657          .10 
Teck Corp., Class B (Canada)                                     700,000        14.441          .08 

Leisure & Tourism - 1.35%                                                                           
Carnival Corp., Class A (USA)                                  3,400,000       157.250          .93 
Walt Disney Co. (USA)                                            600,000        48.375          .29 
Accor SA (France)                                                120,000        22.231          .13 
Euro Disney SCA (France) (1)                                     171,307          .236          .00 

Merchandising - 1.29%                                                                               
Wal-Mart Stores, Inc. (USA)                                    4,150,000       151.994          .90 
Cifra, SA de CV, Class A (Mexico)                              4,970,139        11.136              
Cifra, SA de CV, Class B                                       4,500,000        10.650              
Cifra, SA de CV, Class C                                       3,624,400         7.981          .17 
Home Depot, Inc. (USA)                                           472,500        24.629          .14 
Ito-Yokado Co., Ltd. (Japan)                                     185,000        10.041          .06 
WHSmith Group PLC, Class A (United Kingdom)                      500,000         2.970          .02 

Energy Equipment - 1.27%                                                                            
Schlumberger Ltd. (Netherlands Antilles)                         998,300        84.044          .50 
Halliburton Co. (USA)                                          1,270,000        66.040          .39 
Western Atlas Inc. (USA) (1)                                     740,000        65.120          .38 

Recreation & Other Consumer Products - 1.17%                                                        
Mattel, Inc. (USA)                                             1,900,000        62.938          .37 
Fuji Photo Film Co., Ltd. (Japan)                                900,000        37.195          .22 
Nintendo Co., Ltd. (Japan)                                       350,000        32.822          .19 
Eastman Kodak Co. (USA)                                          400,000        25.975          .15 
EMI Group PLC (United Kingdom)                                 1,375,569        13.532              
EMI Group PLC, Class B preferred shares                          764,205         1.412          .09 
PolyGram NV (New York Registered Shares) (Netherlands)           259,900        14.928          .09 
Fortune Brands Inc. (formerly American Brands, Inc.)                                                
 (USA)                                                           300,000        10.106          .06 

Appliances & Household Durables - 0.98%                                                             
Sony Corp. (Japan)                                               927,000        87.700          .52 
Philips Electronics NV (Netherlands)                             582,500        49.427              
Philips Electronics NV, warrants, expire 1998 (1)                250,000        16.943          .39 
Samsung Electronics Co., Ltd. (South Korea)                      125,727        12.180          .07 

Business & Public Services - 0.98%                                                                  
Quintiles Transnational Corp. (USA) (1)                          500,000        42.125          .25 
United Utilities PLC (United Kingdom)                          3,000,000        37.114          .22 
Cie. Generale des Eaux (France)                                  203,808        24.046              
Cie. Generale des Eaux, warrants, expire 2001 (1)                203,808          .110          .14 
Rentokil Group PLC (United Kingdom)                            4,200,000        17.455          .11 
Reuters Holdings PLC (American Depositary Receipts)                                                 
 (United Kingdom)                                                240,000        17.100          .10 
Waste Management, Inc. (formerly WMX Technologies, Inc.)                                            
 (USA)                                                           395,737        13.826          .08 
Electronic Data Systems Corp. (USA)                              300,000        10.650          .06 
Thorn PLC (United Kingdom)                                     1,301,948         2.942          .02 

Metals: Steel - 0.85%                                                                               
Allegheny Teledyne Inc. (USA)                                  2,040,000        58.395          .34 
Usinor Sacilor (France)                                        2,800,000        56.748          .34 
Cia. Vale do Rio Doce, ordinary nominative (Brazil)               38,400          .893              
Cia. Vale do Rio Doce, preferred nominative                       38,400          .000              
Cia. Vale do Rio Doce, preferred nominative (American                                               
 Depositary Receipts)                                         11,184,000        28.712          .17 

Utilities: Electric & Gas - 0.71%                                                                   
National Power PLC (United Kingdom)                            9,300,000        85.483          .50 
Hongkong Electric Holdings Ltd. (Hong Kong)                    5,213,500        19.406          .12 
Enersis SA (American Depositary Receipts) (Chile)                420,000        15.566          .09 

Transportation: Shipping - 0.57%                                                                    
Bergesen d.y. AS, Class A (Norway)                             1,500,000        46.158              
Bergesen d.y. AS, Class B                                        795,000        24.576          .42 
Nippon Yusen KK (Japan)                                        7,658,000        25.739          .15 

Miscellaneous Materials & Commodities - 0.53%                                                       
Potash Corp. of Saskatchewan Inc. (Canada)                       400,000        31.400          .19 
Cie. de Saint-Gobain (France)                                    189,841        29.362          .17 
De Beers/Centenary linked units (South Africa)                 1,000,000        29.216          .17 

Real Estate - 0.45%                                                                                 
Cheung Kong (Holdings) Ltd. (Hong Kong)                        6,720,000        75.562          .45 

Transportation: Rail & Road - 0.33%                                                                 
CSX Corp. (USA)                                                  950,000        55.575          .33 

Building Materials & Components - 0.33%                                                             
CEMEX, SA de CV, Class A (Mexico)                              2,362,225        12.289              
CEMEX, SA de CV CPO                                            4,040,000        21.225          .20 
Holderbank Financiere Glaris Ltd. (Switzerland)                   23,000        21.880          .13 

Electronic Instruments - 0.29%                                                                      
Tokyo Electron Ltd. (Japan)                                      500,000        30.581          .18 
Applied Materials, Inc. (USA) (1)                                200,000        19.050          .11 

Aerospace & Military Technology - 0.23%                                                             
Boeing Co. (USA)                                                 720,000        39.195          .23 

Industrial Components - 0.22%                                                                       
Bridgestone Corp. (Japan)                                      1,571,000        37.808          .22 

Textiles & Apparel - 0.18%                                                                          
NIKE, Inc., Class B (USA)                                        290,000        15.370          .09 
Gucci Group NV (New York Registered Shares) (Netherlands)        310,000        14.531          .09 

Miscellaneous - 0.24%                                                                               
Other equity-type securities in initial period of                                                   
 acquisition                                                                    39.936          .24 
                                                                         ------------  ------------ 

TOTAL EQUITY-TYPE SECURITIES                                                                        
(cost: $9,917.226 million)                                                  14,990.005        88.41 
                                                                         ------------  ------------ 

                                                             Principal                              
                                                                 Amount                             
Bonds                                                        (Millions)                             
---------------------------------------                    ------------                             

New Zealand Government - 0.18%                                                                      
New Zealand 8.00% November 2006                               NZ$44.500         31.076          .18 

                                                                          -----------   ----------- 
TOTAL BONDS (cost: $29.793 million)                                             31.076          .18 
                                                                          -----------   ----------- 

TOTAL INVESTMENT SECURITIES (cost: $9,947.019 million)                      15,021.081        88.59 
                                                                          -----------   ----------- 

Short-Term Securities                                                                               
------------------------------------------                                                          

Corporate Short-Term Notes - 9.05%                                                                  
Svenska Handelsbanken Group 5.47%-5.50% due 11/4-12/23/97        100.000        99.107          .59 
Toyota Motor Credit Corp. 5.49%-5.50% due 10/16-11/13/97          91.500        91.084          .54 
Ameritech Corp. 5.46%-5.47% due 10/2-10/3/97                      90.000        89.965          .53 
Lucent Technologies Inc. 5.48%-5.50% due 10/8-12/17/97            90.000        89.390          .53 
Daimler-Benz North America Corp. 5.49%-5.50% due 10/14-                                             
 12/19/97                                                         89.500        89.169          .53 
Halifax PLC 5.49% due 11/18-12/3/97                               89.300        88.553          .52 
General Electric Capital Corp. 5.50%-6.50% due 10/1-                                                
 11/12/97                                                         89.240        88.881          .52 
National Australia Funding (Delaware) Inc. 5.47%-5.48%                                              
 due 10/1-12/9/97                                                 85.000        84.790          .50 
E.I. du pont de Nemours and Co. 5.47% due 10/24-12/5/97           73.595        73.184          .43 
Caisse d'amortissement de la dette sociale 5.48%-5.50%                                              
 due 10/20-12/2/97                                                70.000        69.579          .41 
ANZ (Delaware) Inc. 5.49%-5.50% due 10/20-10/28/97                67.300        66.832          .40 
Ford Credit Europe PLC 5.50%-5.52% due 10/7-12/11/97              63.800        63.570          .38 
Canada Bills 5.46%-5.47% due 10/21-11/3/97                        62.800        62.536          .37 
International Lease Finance Corp. 5.47%-5.50% due 10/6-                                             
 12/1/97                                                          62.000        61.654          .36 
Toronto-Dominion Holdings USA Inc. 5.47%-5.53% due 10/22-                                           
 10/31/97                                                         60.000        59.779          .35 
A.I. Credit Corp. 5.49%-5.50% due 10/20-11/3/97                   55.000        54.767          .33 
IBM Credit Corp. 5.48%-5.51% due 10/16-11/14/97                   53.600        53.299          .31 
Commonwealth Bank of Australia 5.50% due 10/8-12/9/97             52.600        52.336          .31 
Rank Xerox Capital (Europe) PLC 5.47%-5.50%                                                         
 due 10/10-10/17/97                                               50.000        49.913          .29 
Abbey National North America 5.47%-5.50% due 10/17-                                                 
 10/20/97                                                         47.000        46.871          .28 
American Express Credit Corp. 5.49%-5.52% due 10/29-                                                
 11/20/97                                                         39.500        39.278          .23 
British Columbia (Province of) 5.45%-5.48% due 10/21-                                               
 10/31/97                                                         31.834        31.711          .19 
Societe Generale NA Inc. 5.51%-5.52% due 12/9-12/10/97            25.600        25.322          .15 

Certificates of Deposit - 1.23%                                                                     
Canadian Imperial Bank of Commerce 5.54%-5.57%                                                      
 due 10/23-11/19/97                                               70.000        69.999          .41 
Westdeutsche Landesbank Girozentrale 5.56%-5.66%                                                    
 due 10/9-10/22/97                                                65.000        65.001          .38 
Abbey National PLC 5.57% due 11/5/97                              50.000        49.999          .29 
Societe Generale 5.55% due 10/1/97                                25.000        25.000          .15 

Federal Agency Discount Notes - 0.84%                                                               
Freddie Mac (formerly Federal Home Loan Mortgage Corp.)                                             
 5.40%-5.48% due 10/7-11/25/97                                    89.100        88.692          .52 
Fannie Mae (formerly Federal National Mortgage Assn.)                                               
 5.40%-5.45% due 11/6-11/24/97                                    55.100        54.718          .32 
                                                                          -----------   ----------- 

Non-U.S. Currency - 0.06%                                                                           
New Taiwanese Dollar                                         NT$292.202         10.231          .06 

TOTAL SHORT-TERM SECURITIES (cost: $1,895.484 million)                       1,895.210        11.18 
Excess of cash and receivables over payables                                    39.793          .23 
                                                                         ------------  ------------ 

TOTAL SHORT-TERM SECURITIES AND NET CASH                                     1,935.003        11.41 
                                                                         ------------  ------------ 

NET ASSETS                                                                $16,956.084        100.00%
                                                                          ===========   =========== 

(1) Non-income-producing securities                                                                 

(2) Purchased in a private placement                                                                
 transaction; resale to the public may                                                              
 require registration or sale only                                                                  
 to qualified institutional buyers.                                                                 

(3) The fund owns 5.72% of the outstanding voting                                                   
 securities of Georgia Gulf Corp., which represent an                                               
 investment in an affiliate as defined in the Investment                                            
 Company Act of 1940.                                                                               

The descriptions of the companies shown in the portfolio,                                           
 which were obtained from published reports and other                                               
 sources believed to be reliable, are supplemental and                                              
 are not covered by the Report of Independent Accountants.                                          

See Notes to Financial Statements                                                                   

                                                                [Download Table]
                                                                                   
New Perspective Fund                                                               

Equity-Type Securities Appearing in the  Equity-Type Securities Eliminated from the
Portfolio Since March 31, 1997           Portfolio Since March 31, 1997            

Accor                                    Baker Hughes                              
Acer                                     Barclays                                  
Allegheny Teledyne                       Bombardier                                
Altera                                   British Airways                           
Applied Materials                        Ciba Specialty Chemicals Holdings         
Archer Daniels Midland                   Cie. Generale des Etablissements Michelin 
Asahi Breweries                          Electrolux                                
Ascend Communications                    Eurotunnel                                
Assicurazioni Generali                   Hasbro                                    
Bank of Tokyo-Mitsubishi                 Hitachi                                   
Bay Networks                             Hoechst                                   
BOC Group                                Incentive                                 
Chase Manhattan                          Inco                                      
Cheung Kong (Holdings)                   Kimberly-Clark                            
Chrysler                                 Litton Industries                         
Cia. Cervejaria Brahma                   NCR                                       
Computer Associates International        Overseas Shipholding Group                
Deutsche Telekom                         Repsol                                    
Digital Equipment                        Republic New York                         
Dow Jones                                SANYO Electric                            
ENI                                      VEBA                                      
Enterprise Oil                           Weyerhaeuser                              
Fairfax Financial                                                                  
Fuji Bank                                                                          
Fujitsu                                                                            
General Electric                                                                   
Gucci Group                                                                        
Guidant                                                                            
HSBC                                                                               
International Business Machines                                                    
Istituto Mobiliare Italiano                                                        
Kvaerner                                                                           
Medtronic                                                                          
Microsoft                                                                          
Mobil                                                                              
Nan Ya Plastics                                                                    
NIKE                                                                               
Pharmacia & Upjohn                                                                 
Quintiles Transnational                                                            
RAO Gazprom                                                                        
Rentokil Group                                                                     
Sakura Bank                                                                        
Samsung Electronics                                                                
Shiseido                                                                           
Sumitomo Bank                                                                      
Swire Pacific                                                                      
Talisman Energy                                                                    
Tokyo Electron                                                                     
Toronto-Dominion Bank                                                              
Westinghouse Electric                                                              

                                                                [Download Table]
                                                                                    
New Perspective Fund                                                                
Financial Statements                                                                
----------------------------------------------   ----------------  ---------------- 
Statement of Assets and Liabilities                                     (dollars in 
at September 30, 1997                                                     millions) 
----------------------------------------------   ----------------  ---------------- 
Assets:                                                                             
Investment securities at market                                                     
 (cost: $9,947.019)                                                     $15,021.081 
Short-term securities                                                               
 (cost: $1,895.484)                                                       1,895.210 
Cash                                                                           .663 
Receivables for-                                                                    
 Sales of investments                                     $38.023                   
 Sales of fund's shares                                    23.147                   
 Dividends and accrued interest                            36.879            98.049 
                                                 ----------------  ---------------- 
                                                                         17,015.003 
Liabilities:                                                                        
Payables for-                                                                       
 Purchases of investments                                  39.837                   
 Repurchases of fund's shares                               9.426                   
 Management services                                        5.769                   
 Accrued expenses                                           3.887             58.919
                                                 ----------------  ---------------- 
Net Assets at September 30, 1997-                                                   
 Equivalent to $21.86 per share on                                                  
 775,640,437 shares of $1 par value                                                 
 capital stock outstanding (authorized                                              
 capital stock--1,000,000,000 shares)                                   $16,956.084 
                                                                   ================ 

Statement of Operations                                                             
for the year ended September 30, 1997                                   (dollars in 
                                                                          millions) 

----------------------------------------------   ----------------  ---------------- 
Investment Income:                                                                  
Income:                                                                             
 Dividends                                              $ 232.693                   
 Interest                                                 101.880         $ 334.573 
                                                 ----------------                   
Expenses:                                                                           
 Management services fee                                   59.337                   
 Distribution expenses                                     32.358                   
 Transfer agent fee                                        12.198                   
 Reports to shareholders                                    1.060                   
 Registration statement and prospectus                      1.301                   
 Postage, stationery and supplies                           1.694                   
 Directors' and Advisory Board fees                          .243                   
 Auditing and legal fees                                     .078                   
 Custodian fee                                              4.117                   
 Taxes other than federal                                                           
  income tax                                                 .170                   
 Other expenses                                              .091            112.647
                                                 ----------------  ---------------- 
 Net investment income                                                       221.926
                                                                   ---------------- 
Realized Gain and Increase in Unrealized                                            
 Appreciation on Investments:                                                       
Net realized gain                                                            922.766
Net increase in unrealized appreciation on                                          
 investments:                                                                       
 Beginning of year                                      2,505.461                   
 End of year                                            5,073.194          2,567.733
                                                 ----------------  ---------------- 
 Net realized gain and unrealized appreciation                                      
  on investments                                                           3,490.499
                                                                   ---------------- 
Net Increase in Net Assets Resulting                                                
 from Operations                                                          $3,712.425
                                                                   ================ 

----------------------------------------------   ----------------  ---------------- 
Statement of Changes in Net Assets                    (dollars in                   
                                                        millions)                   
                                                       Year ended                   
                                                    September 30,                   
                                                             1997               1996
----------------------------------------------   ----------------  ---------------- 
Operations:                                                                         
Net investment income                                $    221.926       $   204.748 
Net realized gain on investments                          922.766           439.315 
Net increase in unrealized appreciation                                             
 on investments                                         2,567.733           389.111 
                                                 ----------------  ---------------- 
 Net increase in net assets                                                         
 resulting from operations                              3,712.425         1,033.174 
                                                 ----------------  ---------------- 

Dividends and Distributions Paid to                                                 
 Shareholders:                                                                      
Dividends from net investment income                     (224.557)         (181.254)
Distributions from net realized gain on                                             
 investments                                             (462.037)         (326.785)
                                                 ----------------  ---------------- 
 Total dividends and distributions                       (686.594)         (508.039)
                                                 ----------------  ---------------- 

Capital Share Transactions:                                                         
Proceeds from shares sold: 160,556,117                                              
 and 168,317,771 shares, respectively                   3,126.904         2,872.559 
Proceeds from shares issued in reinvestment                                         
 of net investment income dividends and                                             
 distributions of net realized gain on                                              
 investments: 36,204,990 and 29,221,609 shares,                                     
 respectively                                             650.157           477.859 
Cost of shares repurchased: 78,902,097                                              
 and 58,868,182 shares, respectively                   (1,534.468)       (1,004.893)
                                                 ----------------  ---------------- 

 Increase in net assets resulting from                                              
  capital share transactions                            2,242.593         2,345.525 
                                                 ----------------  ---------------- 

Total Increase in Net Assets                            5,268.424         2,870.660 

Net Assets:                                                                         
Beginning of year                                      11,687.660         8,817.000 
                                                 ----------------  ---------------- 
End of year (including undistributed                                                
 net investment income: $115.664                                                    
 and $119.565, respectively)                          $16,956.084       $11,687.660 
                                                 ================  ================ 

See Notes to Financial Statements                                                   

Notes to Financial Statements                                                   

1. New Perspective Fund, Inc. (the "fund") is registered under the Investment   
Company Act of 1940 as an open-end, diversified management investment company.  
The fund seeks long-term growth of capital through investments all over the     
world, including the United States. The following paragraphs summarize the      
significant accounting policies consistently followed by the fund in the        
preparation of its financial statements:                                        

Equity-type securities traded on a national securities exchange (or reported
on the Nasdaq national market) and securities traded in the over-the-counter    
market are stated at the last reported sales price on the day of valuation;     
other securities, and securities for which no sale was reported on that date,   
are stated at the last quoted bid price. Long-term and short-term securities    
with original or remaining maturities in excess of 60 days are valued at the    
mean of their quoted bid and asked prices. Short-term securities with 60 days   
or less to maturity are valued at amortized cost, which approximates market     
value. Securities for which market quotations are not readily available are     
valued at fair value by the Board of Directors or a committee thereof.          

As is customary in the mutual fund industry, securities transactions are    
accounted for on the date the securities are purchased or sold. Realized gains  
and losses from securities transactions are reported on an identified cost      
basis. Dividend and interest income is reported on the accrual basis. Discounts 
and premiums on securities purchased are amortized over the life of the         
respective securities. Dividends and distributions paid to shareholders are     
recorded on the ex-dividend date.                                               

Investment securities, cash balances and other assets and liabilities       
denominated in non-U.S. currencies are recorded in the financial statements     
after translation into U.S. dollars utilizing rates of exchange on the last     
business day of the year. Purchases and sales of investment securities, income  
and expenses are calculated using the prevailing exchange rate as accrued. The  
effects of changes in foreign currency exchange rates on investment securities  
are included with the net realized and unrealized gain or loss on investment    
securities.                                                                     

2. It is the fund's policy to continue to comply with the requirements of the   
Internal Revenue Code applicable to regulated investment companies and to       
distribute all of its net taxable income, including any net realized gain on    
investments, to its shareholders. Therefore, no federal income tax provision is 
required.                                                                       

As of September 30, 1997, net unrealized appreciation on investments for    
federal income tax purposes aggregated $5,074,776,000, of which $5,318,292,000  
related to appreciated securities and $243,516,000 related to depreciated       
securities. During the year ended September 30, 1997, the fund realized, on a   
tax basis, a net capital gain of $922,872,000 on securities transactions. Net   
losses related to non-U.S. currency and other transactions of $106,000 were     
treated as an adjustment to ordinary income for federal income tax purposes.    
The capital gain distribution paid in December 1996 includes $4,708,000 of      
realized non-U.S. currency gains. The cost of portfolio securities for federal  
income tax purposes was $11,841,515,000 at September 30, 1997.                  

3. The fee of $59,337,000 for management services was paid pursuant to an       
agreement with Capital Research and Management Company (CRMC), with which       
certain officers and Directors of the fund are affiliated. The Investment       
Advisory and Service Agreement provides for monthly fees, accrued daily, based  
on an annual rate of 0.60% of the first $500 million of average net assets;     
0.50% of such assets in excess of $500 million but not exceeding $1 billion;    
0.46% of such assets in excess of $1 billion but not exceeding $1.5 billion;    
0.43% of such assets in excess of $1.5 billion but not exceeding $2.5 billion;  
0.41% of such assets in excess of $2.5 billion but not exceeding $4 billion;    
0.40% of such assets in excess of $4 billion but not exceeding $6.5 billion;    
0.395% of such assets in excess of $6.5 billion but not exceeding $10.5         
billion; 0.39% of such assets in excess of $10.5 billion but not exceeding $17  
billion; and 0.385% of such assets in excess of $17 billion.                    

Pursuant to a Plan of Distribution, the fund may expend up to 0.25% of its  
average net assets annually for any activities primarily intended to result in  
sales of fund shares, provided the categories of expenses for which             
reimbursement is made are approved by the fund's Board of Directors. Fund       
expenses under the Plan include payments to dealers to compensate them for      
their selling and servicing efforts. During the year ended September 30, 1997,  
distribution expenses under the Plan were $32,358,000. As of September 30,      
1997, accrued and unpaid distribution expenses were $2,763,000.                 

American Funds Service Company (AFS), the transfer agent for the fund, was  
paid a fee of $12,198,000. American Funds Distributors, Inc. (AFD), the         
principal underwriter of the fund's shares, received $12,090,000 (after         
allowances to dealers) as its portion of the sales charges paid by purchasers   
of the fund's shares. Such sales charges are not an expense of the fund and,    
hence, are not reflected in the accompanying statement of operations.           

 Directors and Advisory Board members who are unaffiliated with CRMC may elect
to defer part or all of the fees earned for services as members of the Boards.  
Amounts deferred are not funded and are general unsecured liabilities of the    
fund. As of September 30, 1997, aggregate amounts deferred and earnings thereon 
were $436,000.                                                                  

CRMC is owned by The Capital Group Companies, Inc. AFS and AFD are both     
wholly owned subsidiaries of CRMC. Certain Directors and officers of the fund   
are or may be considered to be affiliated with CRMC, AFS and AFD. No such       
persons received any remuneration directly from the fund.                       

4. As of September 30, 1997, accumulated undistributed net realized gain on     
investments was $848,291,000 and additional paid-in capital was                 
$10,143,295,000. The fund reclassified $1,270,000 and $1,157,000 from           
undistributed net investment income and undistributed net realized gains,       
respectively, to additional paid-in-capital for the year ended September 30,    
1997.                                                                           

The fund made purchases and sales of investment securities, excluding       
short-term securities, of $4,697,161,000 and $3,199,572,000, respectively,      
during the year ended September 30, 1997.                                       

Pursuant to the custodian agreement, the fund receives credits against its  
custodian fee for imputed interest on certain balances with the custodian bank. 
The custodian fee of $4,117,000 includes $61,000 that was paid by these credits 
rather than in cash.                                                            

Dividend and interest income is recorded net of non-U.S. taxes paid. For the
year ended September 30, 1997, such non-U.S. taxes were $21,248,000. Net        
realized currency losses on dividends, interest, withholding taxes reclaimable  
and sales of non-U.S. bonds and notes were $4,038,000 for the year ended        
September 30, 1997.                                                             

                                                        [Enlarge/Download Table]
                                                                                                    
                                         Year ended                                                 
                                        September 30                                                
                                                 1997        1996        1995        1994      1993 
                                         ----------- ----------- ----------- ----------- -----------

Net Asset Value, Beginning of Year            $17.77      $16.98      $15.40      $14.21     $12.25 
                                         ----------- ----------- ----------- ----------- -----------
 Income from Investment Operations:                                                                 
  Net investment income                          .29         .32         .31         .22        .17 
   Net realized gain and increase in                                                                
   unrealized appreciation on investment        4.81        1.40        2.35        1.54       2.04 
                                         ----------- ----------- ----------- ----------- -----------
   Total income from                                                                                
 investment operations                          5.10        1.72        2.66        1.76       2.21 
                                         ----------- ----------- ----------- ----------- -----------
 Less Distributions:                                                                                
  Dividends from net                                                                                
 investment income                             (.323)      (.321)      (.237)      (.173)     (.178)
  Dividends from net realized                                                                       
 non-U.S. currency gains(1)                    (.007)      (.009)      (.003)      (.027)     (.022)
  Distributions from net                                                                            
 realized gains                                (.680)      (.600)      (.840)      (.370)     (.050)
                                         ----------- ----------- ----------- ----------- -----------
   Total distributions                         (1.01)       (.93)      (1.08)       (.57)      (.25)
                                         ----------- ----------- ----------- ----------- -----------
Net Asset Value, End of Year                  $21.86      $17.77      $16.98      $15.40     $14.21 
                                           =========   =========   =========   =========  ========= 

Total Return(2)                               29.97%      10.64%       18.63%      12.61%     18.34%

Ratios/Supplemental Data:                                                                           
  Net assets, end of                                                                                
 year (in millions)                          $16,956     $11,688      $8,817      $6,279     $4,417 
  Ratio of expenses to average                                                                      
 net assets                                      .79%        .82%        .83%       .84%        .87%
  Ratio of net income to                                                                            
 average net assets                             1.56%       2.00%       2.12%      1.48%       1.40%
  Average commissions paid(3)                   .50c       4.30c        .72c       1.05c      1.74c 
  Portfolio turnover rate                     25.68%      18.12%       22.40%      25.33%     15.02%

(1) Realized non-U.S. currency gains                                                                
 are treated as ordinary income for                                                                 
 federal income tax purposes.                                                                       
(2)Calculated without deducting a sales                                                             
 charge. The maximum sales charge is                                                                
 5.75% of the fund's offering price.                                                                
(3) Brokerage commissions paid on                                                                   
 portfolio transactions increase                                                                    
 the cost of securities purchased or                                                                
 reduce the proceeds of securities                                                                  
 sold, and are not separately reflected                                                             
 in the fund's statement of operations.                                                             
 Shares traded on a principal basis                                                                 
 (without commissions), such as most                                                                
 over-the-counter and fixed-income                                                                  
 transactions, are excluded. Generally,                                                             
 non-U.S. commissions are lower than                                                                
 U.S. commissions when expressed as                                                                 
 cents per share but higher when                                                                    
 expressed as a percentage of                                                                       
 transactions because of the lower                                                                  
 per-share prices of many non-U.S.                                                                  
 securities.                                                                                        

To the Board of Directors and Shareholders of New Perspective Fund, Inc.        

In our opinion, the accompanying statement of assets and liabilities, including 
the investment portfolio, and the related statements of operations and of       
changes in net assets and the  per-share data and ratios present fairly, in all 
material respects, the financial position of New Perspective Fund, Inc. (the    
"Fund") at September 30, 1997, the results of its operations, the changes in    
its net assets and the per-share data and ratios for the years indicated in     
conformity with generally accepted accounting principles. These financial       
statements and per-share data and ratios (hereafter referred to as "financial   
statements") are the responsibility of the Fund's management; our               
responsibility is to express an opinion on these financial statements based on  
our audits. We conducted our audits of these financial statements in accordance 
with generally accepted auditing standards which require that we plan and       
perform the audit to obtain reasonable assurance about whether the financial    
statements are free of material misstatement. An audit includes examining, on a 
test basis, evidence supporting the amounts and disclosures in the financial    
statements, assessing the accounting principles used and significant estimates  
made by management, and evaluating the overall financial statement              
presentation. We believe that our audits, which included confirmation of        
securities at September 30, 1997 by correspondence with the custodian and       
brokers and the application of alternative auditing procedures where            
confirmations from brokers were not received, provide a reasonable basis for    
the opinion expressed above.                                                    

/s/Price Waterhouse LLP                                                         

Los Angeles, California                                                         
October 31, 1997                                                                

Tax Information (unaudited)                                                     

We are required to advise you within 60 days of the fund's fiscal year-end      
regarding the federal tax status of distributions received by shareholders      
during such fiscal year. The distributions made during the fiscal year by the   
fund were earned from the following sources:                                    

                                                        [Enlarge/Download Table]

                                      Dividends and Distributions per Share                

To Shareholders    Payment Date       From Net          From Net             From Net      
of Record                             Investment        Realized Short-      Realized Long-
                                      Income            term Gains           term Gains    

                                                                                           
December 13, 1996  December 16, 1996  $.23              $.056                $.624         

May 30, 1997       June 2, 1997       .10               -                    -             


The fund makes an election under the Internal Revenue Code Section 853 to pass  
through non-U.S. taxes paid by the fund to its shareholders. The amount of      
non-U.S. taxes for the fiscal year ended September 30, 1997 is $0.03744 on a    
per-share basis. Shareholders are entitled to a foreign tax credit or an        
itemized deduction, at their option. Generally, it is more advantageous to      
claim a credit rather than to take a deduction.                                 

Corporate shareholders may exclude up to 70% of qualifying dividends received   
during the year. For purposes of computing this exclusion, 17% of the dividends 
paid by the fund from net investment income represents qualifying dividends.    

Dividends and distributions received by retirement plans such as IRAs,          
Keogh-type plans and 403(b) plans need not be reported as taxable income.       
However, many plan retirement trusts may need this information for their annual 
information reporting.                                                          

SINCE THE AMOUNTS ABOVE ARE REPORTED FOR THE FUND'S FISCAL YEAR AND NOT THE     
CALENDAR YEAR, SHAREHOLDERS SHOULD REFER TO THEIR FORM 1099-DIV WHICH WILL BE   
MAILED IN JANUARY 1998 TO DETERMINE THE CALENDAR YEAR AMOUNTS TO BE INCLUDED ON 
THEIR 1997 TAX RETURNS. SHAREHOLDERS SHOULD CONSULT THEIR TAX ADVISERS.         

NEW PERSPECTIVE FUND                                                            

BOARD OF DIRECTORS                                                              

ELISABETH ALLISON, Cambridge, Massachusetts                                     
Administrative Director, ANZI, Ltd.;                                            
Publishing Consultant, Harvard Medical School                                   

MICHAEL R. BONSIGNORE, Minneapolis, Minnesota                                   
Chairman and Chief Executive Officer,                                           
Honeywell Inc.                                                                  

GINA H. DESPRES, Washington, D.C.                                               
President of the fund                                                           
Senior Vice President,                                                          
Capital Research and Management Company                                         

DAVID I. FISHER, Los Angeles, California                                        
Chairman of the Board,                                                          
The Capital Group Companies, Inc.                                               

ROBERT A. FOX, Livingston, California                                           
President and Chief Executive Officer,                                          
Foster Farms Inc.                                                               

ALAN GREENWAY, La Jolla, California                                             
Private investor; President,                                                    
Greenway Associates, Inc.                                                       
(management consulting services)                                                

KOICHI ITOH, Tokyo, Japan                                                       
President and Chief Executive Officer, IMPAC                                    
(management consulting services);                                               
former managing partner, VENCA Management  (venture capital)                    

WILLIAM H. KLING, St. Paul, Minnesota                                           
President, Minnesota Public Radio;                                              
President, Greenspring Co.;                                                     
former President, American Public Radio                                         
(now Public Radio International)                                                

JON B. LOVELACE, Los Angeles, California                                        
Vice Chairman of the Board of the fund                                          
Vice Chairman of the Board,                                                     
Capital Research and Management Company                                         

JOHN G. MCDONALD, Stanford, California                                          
The IBJ Professor of Finance,                                                   
Graduate School of Business,                                                    
Stanford University                                                             

WILLIAM I. MILLER, Columbus, Indiana                                            
Chairman of the Board,                                                          
Irwin Financial Corporation                                                     

KIRK P. PENDLETON, Southampton, Pennsylvania                                    
Chairman of the Board and                                                       
Chief Executive Officer, Cairnwood, Inc.                                        
(venture capital investment)                                                    

DONALD E. PETERSEN, Birmingham, Michigan                                        
Retired; former Chairman of the Board and                                       
Chief Executive Officer, Ford Motor Company                                     

JAMES W. RATZLAFF, San Francisco, California                                    
Senior Partner, The Capital Group Partners L.P.                                 

WALTER P. STERN, New York, New York                                             
Chairman of the Board of the fund                                               
Chairman of the Board,                                                          
Capital Group International, Inc.                                               

OTHER OFFICERS                                                                  

WILLIAM R. GRIMSLEY, San Francisco, California                                  
Senior Vice President of the fund                                               
Senior Vice President and Director,                                             
Capital Research and Management Company                                         

GREGG E. IRELAND, Washington, D.C.                                              
Senior Vice President of the fund                                               
Senior Vice President,                                                          
Capital Research and Management Company                                         

THIERRY VANDEVENTER, Geneva, Switzerland                                        
Senior Vice President of the fund                                               
Director,                                                                       
Capital Research and Management Company                                         

DARCY B. KOPCHO, Los Angeles, California                                        
Vice President of the fund                                                      
Vice President and Director,                                                    
Capital Research Company                                                        

CATHERINE M. WARD, Los Angeles, California                                      
Vice President of the fund                                                      
Senior Vice President and Director,                                             
Capital Research and Management Company                                         

VINCENT P. CORTI, Los Angeles, California                                       
Secretary of the fund                                                           
Vice President - Fund Business                                                  
Management Group,                                                               
Capital Research and Management Company                                         

R. MARCIA GOULD, Brea, California                                               
Treasurer of the fund                                                           
Vice President - Fund Business                                                  
Management Group,                                                               
Capital Research and Management Company                                         

MEMBERS OF THE ADVISORY BOARD                                                   

YOICHI FUNABASHI, Ph.D., Tokyo, Japan                                           
Chief Diplomatic Correspondent and columnist for the Asahi Shimbun              

JEAN GANDOIS, Paris, France                                                     
President, Conseil National du Patronat Fran<UNDEF>ais;                         
Chairman of the Board of Cockerill-Sambre;                                      
former Chairman and Chief Executive Officer,                                    
Pechiney, and former Chairman, Pechiney                                         
International                                                                   

CLAUDIO X. GONZALEZ LAPORTE,                                                    
Mexico, DF, Mexico                                                              
Chairman of the Board and Chief Executive                                       
Officer, Kimberly-Clark de M<UNDEF>xico, SA de CV                               

SIR PETER HOLMES, London, England                                               
Director and former Chairman of the Board and                                   
Managing Director, The Royal Dutch/Shell Group                                  
of Companies                                                                    

JAE-HYUN HYUN, New York, New York                                               
Chairman, Tong Yang Group                                                       

BARON GUALTHERUS KRAIJENHOFF,                                                   
Nijmegen, Netherlands                                                           
Chairman of the Supervisory Council, Akzo NV                                    

PIERRE LESCURE, Paris, France*                                                  
Chairman and Chief Executive Officer, Canal+                                    

ALLEN E. PUCKETT, Pacific Palisades, California                                 
Chairman Emeritus, Hughes Aircraft Company                                      

ROZANNE L. RIDGWAY, Washington, D.C.                                            
Chair, Baltic American Enterprises Fund,                                        
former Co-Chair, Atlantic Council of the                                        
United States                                                                   

ORVILLE H. SCHELL, Berkeley, California                                         
Dean, Graduate School of Journalism,                                            
University of California at Berkeley                                            

*Effective October 1, 1997                                                      
The following members retired from the Advisory Board effective September 30,   
1997:                                                                           

JUNICHI HATTORI had been on the Advisory Board since 1988. PETER C. HOBBINS had 
been on the Advisory Board since 1987. The Honourable JOHN L. NICHOL and BRIAN  
NICHOLSON had been on the Advisory Board since 1984. HAROLD M. WILLIAMS had     
been on the Advisory Board since 1981.                                          

STEVEN N. KEARSLEY retired as Treasurer of the fund effective May 20, 1997. He  
had been an officer since 1973.                                                 

The Directors thank these six individuals for their many contributions to the   
fund.                                                                           

OFFICES OF THE FUND AND OF THE                                                  
INVESTMENT ADVISER,                                                             
CAPITAL RESEARCH AND MANAGEMENT COMPANY                                         
333 South Hope Street                                                           
Los Angeles, California 90071-1443                                              

135 South State College Boulevard                                               
Brea, California 92821-5804                                                     

TRANSFER AGENT FOR SHAREHOLDER ACCOUNTS                                         
American Funds Service Company                                                  
(Please write to the address nearest you.)                                      
P.O. Box 2205                                                                   
Brea, California 92822-2205                                                     

P.O. Box 659522                                                                 
San Antonio, Texas 78265-9522                                                   

P.O. Box 6007                                                                   
Indianapolis, Indiana 46206-6007                                                

P.O. Box 2280                                                                   
Norfolk, Virginia 23501-2280                                                    

CUSTODIAN OF ASSETS                                                             
The Chase Manhattan Bank                                                        
One Chase Manhattan Plaza                                                       
New York, New York 10081-0001                                                   

INDEPENDENT ACCOUNTANTS                                                         
Price Waterhouse LLP                                                            
400 South Hope Street                                                           
Los Angeles, California 90071-2889                                              

COUNSEL                                                                         
O'Melveny & Myers LLP                                                           
400 South Hope Street                                                           
Los Angeles, California 90071-2899                                              

PRINCIPAL UNDERWRITER                                                           
American Funds Distributors, Inc.                                               
333 South Hope Street                                                           
Los Angeles, California 90071-1462                                              
For information about your account or any of the fund's services, please        
contact your financial adviser. You may also call American Funds Service        
Company, toll-free, at 800/421-0180 or visit www.americanfunds.com on the World 
Wide Web.                                                                       

THIS REPORT IS FOR THE INFORMATION OF SHAREHOLDERS OF NEW PERSPECTIVE FUND, BUT 
IT MAY ALSO BE USED AS SALES LITERATURE WHEN PRECEDED OR ACCOMPANIED BY THE     
CURRENT PROSPECTUS, WHICH GIVES DETAILS ABOUT CHARGES, EXPENSES, INVESTMENT     
OBJECTIVES AND OPERATING POLICIES OF THE FUND. IF USED AS SALES MATERIAL AFTER  
DECEMBER 31, 1997, THIS REPORT MUST BE ACCOMPANIED BY AN AMERICAN FUNDS GROUP   
STATISTICAL UPDATE FOR THE MOST RECENTLY COMPLETED CALENDAR QUARTER.            

Printed on recycled paper                                                       
Litho in USA   AGD/GRS/3215                                                     
Lit. No. NPF-011-1197                                                           
[The American Funds Group (R)]                                                  

Dates Referenced Herein   and   Documents Incorporated by Reference

This ‘N-30D’ Filing		Date		Other Filings
		1/1/98
		12/31/97
Filed on:		12/9/97
		11/17/97
		10/31/97
		10/1/97
For Period End:		9/30/97		24F-2NT,  NSAR-B
		6/2/97
		5/30/97		NSAR-A
		5/20/97
		3/31/97		N-30D,  NSAR-A
		12/16/96
		12/13/96
				List all Filings