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Capital World Growth & Income Fund Inc · 497 · On 3/1/04

Filed On 3/1/04 2:57pm ET · SEC File 33-54444 · Accession Number 894005-4-8

  As Of               Filer                 Filing     As/For/On Docs:Pgs

 3/01/04  Capital World Growth & Incom..Inc 497         3/01/04    1:166

Definitive Material · Rule 497
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 497         Definitive Material                                  166±   757K

Document Table of Contents

Page	(sequential)	\|	(alphabetic)	Top
			Alternative Formats (RTF, XML, et al.) After March 31, 2004: Appendix Certain Investment Limitations and Guidelines Class A Sales Charge Reductions Description of Certain Securities and Investment Techniques Execution of Portfolio Transactions Financial Statements Fundamental Policies and Investment Restrictions Fund Numbers General Information Individual Retirement Account (IRA) Rollovers Management of the Fund Moody's Price of Shares Purchase, Exchange and Sale of Shares Purchase of Shares Sales Charge Reductions and Waivers Sales Charges Selling Shares Shareholder Account Services and Privileges Standard & Poor's Table of Contents Taxes and Distributions
1	1st Page
"	Table of Contents
2	Certain Investment Limitations and Guidelines
"	Description of Certain Securities and Investment Techniques
7	Fundamental Policies and Investment Restrictions
10	Management of the Fund
24	Taxes and Distributions
30	Purchase of Shares
31	Fund Numbers
33	Sales Charges
34	After March 31, 2004:
37	Sales Charge Reductions and Waivers
41	Individual Retirement Account (IRA) Rollovers
"	Price of Shares
43	Selling Shares
45	Shareholder Account Services and Privileges
48	Execution of Portfolio Transactions
49	General Information
52	Appendix
"	Moody's
53	Standard & Poor's
54	Financial Statements
79	Purchase, Exchange and Sale of Shares
85	Class A Sales Charge Reductions

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CAPITAL WORLD GROWTH AND INCOME FUND, INC.

Part B
Statement of Additional Information

February 1, 2004
(as amended March 1, 2004)

This document is not a prospectus but should be read in conjunction with the
current prospectus of Capital World Growth and Income Fund (the "fund or "WGI")
dated February 1, 2004. The prospectus may be obtained from your financial
adviser or by writing to the fund at the following address:

Capital World Growth and Income Fund, Inc.
Attention: Secretary
333 South Hope Street
Los Angeles, California 90071
(213) 486-9200

Shareholders who purchase shares at net asset value through eligible retirement
plans should note that not all of the services or features described below may
be available to them. They should contact their employer for details.

TABLE OF CONTENTS

[Download Table]

Item Page No.
---- --------

Certain Investment Limitations and Guidelines . . . . . . . . . . . 2
Description of Certain Securities and Investment Techniques . . . . 2
Fundamental Policies and Investment Restrictions. . . . . . . . . . 7
Management of the Fund . . . . . . . . . . . . . . . . . . . . . . 10
Taxes and Distributions . . . . . . . . . . . . . . . . . . . . . . 24
Purchase of Shares. . . . . . . . . . . . . . . . . . . . . . . . . 30
Sales Charges . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Sales Charge Reductions and Waivers . . . . . . . . . . . . . . . . 37
Individual Retirement Account (IRA) Rollovers . . . . . . . . . . . 41
Price of Shares . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Selling Shares. . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Shareholder Account Services and Privileges . . . . . . . . . . . . 45
Execution of Portfolio Transactions . . . . . . . . . . . . . . . . 48
General Information . . . . . . . . . . . . . . . . . . . . . . . . 49
Appendix. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
Financial Statements

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CERTAIN INVESTMENT LIMITATIONS AND GUIDELINES

The following limitations and guidelines are considered at the time of purchase,
under normal circumstances, and are based on a percentage of the fund's net
assets unless otherwise noted. This summary is not intended to reflect all of
the fund's investment limitations.

.. The fund may invest up to 10% of its assets in straight debt securities
(i.e., not convertible into equity) rated Baa or below by Moody's Investors
Service, Inc. ("Moody's") and BBB or below by Standard & Poor's Corporation
("S&P") or unrated but determined to be of equivalent quality.

.. The fund may invest up to 5% of its assets in straight debt securities
(i.e., not convertible into equity) rated Ba or below by Moody's and BB or
below by S&P or unrated but determined to be of equivalent quality.

.. For temporary defensive purposes, the fund may invest principally or
entirely in securities that are denominated in U.S. dollars or whose
issuers are domiciled in the United States. Securities denominated in U.S.
dollars include American Depositary Receipts ("ADRs"), certain European
Depositary Receipts ("EDRs") and Global Depositary Receipts ("GDRs").

* * * * * *

The fund may experience difficulty liquidating certain portfolio securities
during significant market declines or periods of heavy redemptions.

DESCRIPTION OF CERTAIN SECURITIES AND INVESTMENT TECHNIQUES

The descriptions below are intended to supplement the material in the prospectus
under "Investment Objective, Strategies and Risks."

EQUITY SECURITIES - Equity securities represent an ownership position in a
company. Equity securities held by the fund typically consist of common stocks.
The prices of equity securities fluctuate based on, among other things, events
specific to their issuers and market, economic and other conditions.

INVESTING IN SMALLER CAPITALIZATION STOCKS - The fund may invest in the stocks
of smaller capitalization companies (typically companies with market
capitalizations of less than $1.5 billion at the time of purchase). The
investment adviser believes that the issuers of smaller capitalization stocks
often provide attractive investment opportunities. However, investing in smaller
capitalization stocks can involve greater risk than is customarily associated
with investing in stocks of larger, more established companies. For example,
smaller companies often have limited product lines, markets or financial
resources, may be dependent for management on one or a few key persons, and can
be more susceptible to losses. Also, their securities may be thinly traded (and
therefore have to be sold at a discount from current prices or sold in small
lots over an extended period of time), may be followed by fewer investment
research analysts, and may be subject to wider price swings, thus creating a
greater chance of loss than securities of larger capitalization companies.

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DEBT SECURITIES - Debt securities are used by issuers to borrow money. Issuers
pay investors interest and generally must repay the amount borrowed at maturity.
Some debt securities, such as zero coupon bonds, do not pay current interest,
but are purchased at a discount from their face values. The prices of debt
securities fluctuate depending on such factors as interest rates, credit quality
and maturity. In general, prices of debt securities decline when interest rates
rise and increase when interest rates fall.

Lower rated debt securities, rated Ba or below by Moody's and/or BB or below by
S&P or unrated but determined to be of equivalent quality, are described by the
rating agencies as speculative and involve greater risk of default or price
changes due to changes in the issuer's creditworthiness than higher rated debt
securities, or they may already be in default. The market prices of these
securities may fluctuate more than higher quality securities and may decline
significantly in periods of general economic difficulty. It may be more
difficult to dispose of, or to determine the value of, lower rated debt
securities.

Certain additional risk factors relating to debt securities are discussed below:

SENSITIVITY TO INTEREST RATE AND ECONOMIC CHANGES - Debt securities may be
sensitive to adverse economic changes, political and corporate developments
and interest rate changes. In addition, during an economic downturn or
substantial period of rising interest rates, issuers that are highly
leveraged may experience increased financial stress that would adversely
affect their ability to service their principal and interest payment
obligations, to meet projected business goals, and to obtain additional
financing. Periods of economic change and uncertainty also can be expected
to result in increased volatility of market prices and yields of certain
debt securities.

PAYMENT EXPECTATIONS - Debt securities may contain redemption or call
provisions. If an issuer exercises these provisions in a declining interest
rate market, the fund would have to replace the security with a lower
yielding security, resulting in a decreased return to investors. If the
issuer of a debt security defaults on its obligations to pay interest or
principal or is the subject of bankruptcy proceedings, the fund may incur
losses or expenses in seeking recovery of amounts owed to it.

LIQUIDITY AND VALUATION - There may be little trading in the secondary
market for particular debt securities, which may affect adversely the
fund's ability to value accurately or dispose of such debt securities.
Adverse publicity and investor perceptions, whether or not based on
fundamental analysis, may decrease the value and/or liquidity of debt
securities.

The investment adviser attempts to reduce the risks described above through
diversification of the portfolio and by credit analysis of each issuer, as well
as by monitoring broad economic trends and corporate and legislative
developments, but there can be no assurance that it will be successful in doing
so.

SECURITIES WITH EQUITY AND DEBT CHARACTERISTICS - The fund may invest in
securities that have a combination of equity and debt characteristics. These
securities may at times behave more like equity than debt and vice versa. Some
types of convertible bonds or preferred stocks automatically convert into common
stocks. The prices and yields of nonconvertible preferred stocks generally move
with changes in interest rates and the issuer's credit quality, similar to the
factors affecting debt securities.

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Convertible bonds, convertible preferred stocks and other securities may
sometimes be converted into common stocks or other securities at a stated
conversion ratio. These securities, prior to conversion, pay a fixed rate of
interest or a dividend. Because convertible securities have both debt and equity
characteristics, their value varies in response to many factors, including the
value of the underlying assets, general market and economic conditions, and
convertible market valuations, as well as changes in interest rates, credit
spreads, and the credit quality of the issuer.

INVESTING IN VARIOUS COUNTRIES - Investing outside the United States may involve
additional risks, caused by, among other things: currency controls and
fluctuating currency values; different accounting, auditing, financial reporting
and legal standards and practices in some countries; changing local, regional
and global economic, political and social conditions; expropriation or
confiscatory taxation; greater market volatility; differing securities market
structures; and various administrative difficulties such as delays in clearing
and settling portfolio transactions or in receiving payment of dividends.
However, in the opinion of the investment adviser, investing outside the United
States also can reduce certain portfolio risks due to greater diversification
opportunities.

The risks described above may be heightened in connection with investments in
developing countries. Although there is no universally accepted definition, a
developing country is generally considered to be a country in the initial stages
of its industrialization cycle with a low per capita gross national product. For
example, political and/or economic structures in these countries may be in their
infancy and developing rapidly. Historically, the markets of developing
countries have been more volatile than the markets of developed countries. The
fund invests in securities of issuers in developing countries to a limited
extent.

Additional costs could be incurred in connection with the fund's investment
activities outside the United States. Brokerage commissions may be higher
outside the United States, and the fund will bear certain expenses in connection
with its currency transactions. Furthermore, increased custodian costs may be
associated with maintaining assets in certain jurisdictions.

DEPOSITARY RECEIPTS - ADRs, in registered form, are designed for use in the U.S.
securities markets and are generally dollar denominated. EDRs, in bearer form,
are designed for use in the European securities markets and may be dollar
denominated. GDRs, in bearer form, primarily are designed for use in the
European and the U.S. securities markets, and may be dollar denominated.
Depositary receipts represent and may be converted into the underlying foreign
security.

CURRENCY TRANSACTIONS - The fund may purchase and sell currencies to facilitate
securities transactions and enter into forward currency contracts to protect
against changes in currency exchange rates. A forward currency contract is an
obligation to purchase or sell a specific currency at a future date, which may
be any fixed number of days from the date of the contract agreed upon by the
parties, at a price set at the time of the contract. Forward currency contracts
entered into by the fund will involve the purchase or sale of one currency
against the U.S. dollar. While entering into forward currency transactions could
minimize the risk of loss due to a decline in the value of the hedged currency,
it could also limit any potential gain that may result from an increase in the
value of the currency. The fund will not generally attempt to protect against
all potential changes in exchange rates. The fund will segregate liquid assets
that will be marked to market daily to meet its forward contract commitments to
the extent required by the Securities and Exchange Commission.

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Certain provisions of the Internal Revenue Code may affect the extent to which
the fund may enter into forward contracts. Such transactions also may affect the
character and timing of income, gain or loss recognized by the fund for U.S.
federal income tax purposes.

REPURCHASE AGREEMENTS - The fund may enter into repurchase agreements under
which the fund buys a security and obtains a simultaneous commitment from the
seller to repurchase the security at a specified time and price. Repurchase
agreements permit the fund to maintain liquidity and earn income over periods of
time as short as overnight. The seller must maintain with the fund's custodian
collateral equal to at least 100% of the repurchase price, including accrued
interest, as monitored daily by the investment adviser. The fund will only enter
into repurchase agreements involving securities in which it could otherwise
invest and with selected banks and securities dealers whose financial condition
is monitored by the investment adviser. If the seller under the repurchase
agreement defaults, the fund may incur a loss if the value of the collateral
securing the repurchase agreement has declined and may incur disposition costs
in connection with liquidating the collateral. If bankruptcy proceedings are
commenced with respect to the seller, realization of the collateral by the fund
may be delayed or limited.

U.S. TREASURY SECURITIES - U.S. Treasury securities include direct obligations
of the U.S. Treasury, such as Treasury bills, notes and bonds. For these
securities, the payment of principal and interest is unconditionally guaranteed
by the U.S. government, and thus they are of the highest possible credit
quality. Such securities are subject to variations in market value due to
fluctuations in interest rates, but, if held to maturity, will be paid in full.

U.S. AGENCY SECURITIES - U.S. agency securities include those securities issued
by certain U.S. government instrumentalities and certain federal agencies. These
securities are neither direct obligations of, nor guaranteed by, the Treasury.
However, they generally involve some form of federal sponsorship: some are
backed by specific types of collateral; some are supported by the issuer's right
to borrow from the Treasury; and others are supported only by the credit of the
issuing government agency or instrumentality. These agencies and
instrumentalities include, but are not limited to: Federal Home Loan Bank,
Federal Home Loan Mortgage Corporation ("Freddie Mac"), Federal National
Mortgage Association ("Fannie Mae"), Tennessee Valley Authority and Federal Farm
Credit Bank System.

REAL ESTATE INVESTMENT TRUSTS - The fund may invest in securities issued by real
estate investment trusts ("REITs"), which are pooled investment vehicles that
primarily invest in real estate or real estate-related loans. REITs are not
taxed on income distributed to shareholders provided they meet requirements
imposed by the Internal Revenue Code. The risks associated with REIT debt
investments are similar to the risks of investing in corporate-issued debt. In
addition, the return on REITs is dependent on such factors as the skill of
management and the real estate environment in general. Debt that is issued by
REITs is typically rated by the credit rating agencies as investment grade or
above.

CASH AND CASH EQUIVALENTS - These include: (i) commercial paper (e.g.,
short-term notes up to nine months in maturity issued by corporations,
governmental bodies or bank/corporation sponsored conduits (asset-backed
commercial paper)), (ii) commercial bank obligations (e.g., certificates of
deposit, bankers' acceptances (time drafts on a commercial bank where the bank
accepts an irrevocable obligation to pay at maturity)), (iii) savings
association and savings bank obligations (e.g., bank notes and certificates of
deposit issued by savings banks or savings associations), (iv) securities of the
U.S. government, its agencies or instrumentalities that mature,

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or may be redeemed, in one year or less, and (v) corporate bonds and notes that
mature, or that may be redeemed, in one year or less.

FORWARD COMMITMENTS - The fund may enter into commitments to purchase or sell
securities at a future date. When the fund agrees to purchase such securities,
it assumes the risk of any decline in value of the security beginning on the
date of the agreement. When the fund agrees to sell such securities, it does not
participate in further gains or losses with respect to the securities beginning
on the date of the agreement. If the other party to such a transaction fails to
deliver or pay for the securities, the fund could miss a favorable price or
yield opportunity, or could experience a loss.

The fund will not use these transactions for the purpose of leveraging and will
segregate liquid assets which will be marked to market daily in an amount
sufficient to meet its payment obligations in these transactions. Although these
transactions will not be entered into for leveraging purposes, to the extent the
fund's aggregate commitments in connection with these transactions exceed its
segregated assets, the fund temporarily could be in a leveraged position
(because it may have an amount greater than its net assets subject to market
risk). Should market values of the fund's portfolio securities decline while the
fund is in a leveraged position, greater depreciation of its net assets would
likely occur than if it were not in such a position. The fund will not borrow
money to settle these transactions and, therefore, will liquidate other
portfolio securities in advance of settlement if necessary to generate
additional cash to meet its obligations.

RESTRICTED SECURITIES AND LIQUIDITY - The fund may purchase securities subject
to restrictions on resale. Securities not actively traded will be considered
illiquid unless they have been specifically determined to be liquid under
procedures adopted by the fund's Board of Directors, taking into account factors
such as the frequency and volume of trading, the commitment of dealers to make
markets and the availability of qualified investors, all of which can change
from time to time. The fund may incur certain additional costs in disposing of
illiquid securities.

* * * * * *

PORTFOLIO TURNOVER - Portfolio changes will be made without regard to the length
of time particular investments may have been held. Short-term trading profits
are not the fund's objective, and changes in its investments are generally
accomplished gradually, though short-term transactions may occasionally be made.
High portfolio turnover (100% or more) involves correspondingly greater
transaction costs in the form of dealer spreads or brokerage commissions, and
may result in the realization of net capital gains, which are taxable when
distributed to shareholders.

Fixed-income securities are generally traded on a net basis and usually neither
brokerage commissions nor transfer taxes are involved. Transaction costs are
usually reflected in the spread between the bid and asked price.

A fund's portfolio turnover rate would equal 100% if each security in the fund's
portfolio were replaced once per year. The fund's portfolio turnover rates for
the fiscal years ended 2003 and 2002 were 27% and 32%, respectively. See
"Financial Highlights" in the prospectus for the fund's annual portfolio
turnover for each of the last five fiscal years.

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FUNDAMENTAL POLICIES AND INVESTMENT RESTRICTIONS

FUNDAMENTAL POLICIES - The fund has adopted the following fundamental policies
and investment restrictions which may not be changed without approval by holders
of a majority of its outstanding shares. Such majority is defined in the
Investment Company Act of 1940, as amended (the "1940 Act"), as the vote of the
lesser of (i) 67% or more of the outstanding voting securities present at a
meeting, if the holders of more than 50% of the outstanding voting securities
are present in person or by proxy, or (ii) more than 50% of the outstanding
voting securities. All percentage limitations are considered at the time
securities are purchased and are based on the fund's net assets unless otherwise
indicated. None of the following investment restrictions involving a maximum
percentage of assets will be considered violated unless the excess occurs
immediately after, and is caused by, an acquisition by the fund.

These restrictions provide that the fund may not:

1. With respect to 75% of the fund's total assets, purchase the securities of
any issuer (other than securities issued or guaranteed by the U.S. government or
any of its agencies or instrumentalities) if, as a result, (a) more than 5% of
the fund's total assets would be invested in the securities of that issuer, or
(b) the fund would hold more than 10% of the outstanding voting securities of
that issuer;

2. Purchase or sell real estate unless acquired as a result of ownership of
securities or other instruments (but this shall not prevent the fund from
investing in securities or other instruments backed by real estate or securities
of companies engaged in the real estate business);

3. Purchase or sell commodities unless acquired as a result of ownership of
securities or other instruments (but this shall not prevent the fund from
engaging in currency-related options and forward or futures contracts);

4. Invest 25% or more of the fund's total assets in the securities of issuers
in the same industry. Obligations of the U.S. government, its agencies and
instrumentalities are not subject to this 25% limitation on industry
concentration;

5. Invest more than 15% of the value of its net assets in securities which are
not readily marketable (including repurchase agreements maturing in more than
seven days or securities traded outside the U.S. for which there is no
recognized exchange or active and substantial over-the-counter market) or engage
in the business of underwriting securities of other issuers, except to the
extent that the purchase or disposal of an investment position may technically
constitute the fund as an underwriter as that term is defined under the
Securities Act of 1933;

6. Invest in companies for the purpose of exercising control or management;

7. Make loans to others except for (a) purchasing debt securities; (b)
entering into repurchase agreements; and (c) loaning portfolio securities;

8. Issue senior securities, except as permitted under the Investment Company
Act of 1940 as amended (the (Alpha)1940 Act^);

9. Borrow money, except from banks for temporary purposes in an amount not to
exceed one-third of the value of the fund's total assets. Moreover, in the event
that the asset coverage for

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such borrowing falls below 300%, the fund will reduce, within three days, the
amount of its borrowing in order to provide for 300% asset coverage;

10. Pledge or hypothecate assets in excess of one-third of the fund's total
assets; or

11. Purchase or sell puts, calls, straddles, or spreads, or combinations
thereof (except for currency options).

For the purposes of Investment Restriction number 7, the fund does not currently
intend to engage in an ongoing or regular securities lending program or invest
in securities or other instruments backed by real estate.

NON-FUNDAMENTAL POLICIES - The following non-fundamental policies may be changed
without shareholder approval:

1. The fund does not currently intend (at least for the next 12 months) to
sell securities short, except to the extent that the fund contemporaneously
owns, or has the right to acquire at no additional cost, securities identical to
those sold short.

2. The fund does not currently intend (at least for the next 12 months) to
purchase securities on margin, except that margin payments in connection with
currency-related transactions shall not constitute purchasing securities on
margin.

3. The fund does not currently intend (at least for the next 12 months) to
purchase the securities of any issuer (other than securities issued or
guaranteed by the governments of any country or political subdivisions thereof)
if, as a result, more than 5% of its total assets would be invested in the
securities of business enterprises that, including predecessors, have a record
of less than three years of continuous operation.

4. The fund does not currently intend (at least for the next 12 months) to
invest in oil, gas, or other mineral exploration or development programs or
leases.

5. The fund does not currently intend (at least for the next 12 months) to
purchase the securities of any issuer if officers and Directors of the fund, its
investment adviser or principal underwriter individually own more than ^ of 1%
of such issuer's securities, and together own more than 5% of such issuer's
securities.

6. The fund does not currently intend (at least for the next 12 months) to
invest more than 5% of its net assets, valued at the lower of cost or market at
the time of purchase, in warrants, including not more than 2% of such net assets
in warrants that are not listed on a major stock exchange. However, warrants
acquired in units or attached to securities may be deemed to be without value
for the purpose of this restriction.

7. Although the fund has no current intention of purchasing securities of
other investment companies (at least for the next 12 months), it has the ability
to invest up to 5% of its total assets in shares of closed-end investment
companies. Additionally, the fund would not acquire more than 3% of the
outstanding voting securities of any one closed-end investment company. (To the
extent that the fund invests in another investment company, it would pay an
investment advisory fee in addition to the fee paid to the investment adviser.)
Notwithstanding this restriction, the fund may invest in securities of other
managed investment companies if deemed advisable by its

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officers in connection with the administration of a deferred compensation plan
adopted by Directors and to the extent such investments are allowed by an
exemptive order granted by the U.S. Securities and Exchange Commission.

8. The fund does not currently intend (at least for the next 12 months) to
invest more than 5% of its net assets in restricted securities (excluding Rule
144A securities and 4(2) commercial paper).

9. The fund does not currently intend (at least for the next 12 months) to
purchase securities in the event its borrowings exceed 5% of its net assets.

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MANAGEMENT OF THE FUND

BOARD OF DIRECTORS AND OFFICERS

[Enlarge/Download Table]

YEAR FIRST NUMBER OF BOARDS
POSITION ELECTED WITHIN THE FUND OTHER DIRECTORSHIPS/3/
WITH THE A DIRECTOR PRINCIPAL OCCUPATION(S) DURING COMPLEX/2/ ON WHICH HELD
NAME AND AGE FUND OF THE FUND/1/ PAST 5 YEARS DIRECTOR SERVES BY DIRECTOR
-----------------------------------------------------------------------------------------------------------------------------------

"NON-INTERESTED" DIRECTORS
-----------------------------------------------------------------------------------------------------------------------------------
H. Frederick Director 1993 Private investor; former 19 Ducommun Incorporated;
Christie President and CEO, The Mission IHOP Corporation;
Age: 70 Group (non-utility holding Southwest Water
company, subsidiary of Southern Company;
California Edison Company) Valero L.P.
-----------------------------------------------------------------------------------------------------------------------------------
Merit E. Janow Director 2001 Professor, Columbia University, 2 None
Age: 45 School of International and
Public Affairs
-----------------------------------------------------------------------------------------------------------------------------------
Mary Myers Kauppila Director 1993 Private investor; Chairman of 5 None
Age: 49 the Board and CEO, Ladera
Management Company (venture
capital and agriculture);
former owner and President,
Energy Investment, Inc.
-----------------------------------------------------------------------------------------------------------------------------------
Gail L. Neale Director 1993 President, The Lovejoy 5 None
Age: 68 Consulting Group, Inc. (a pro
bono consulting group advising
nonprofit organizations)
-----------------------------------------------------------------------------------------------------------------------------------
Robert J. O'Neill, Director 1993 Deputy Chairman of the Council 3 None
Ph.D. and Chairman of the
Age: 67 International Advisory Panel,
Graduate School of Government,
University of Sydney,
Australia; Member of the Board
of Directors, The Lowy
Institute for International
Policy Studies, Sydney,
Australia; Chairman of the
Council, Australian Strategic
Policy Institute; former
Chichele Professor of the
History of War and Fellow, All
Souls College, University of
Oxford; former Chairman of the
Council, International
Institute for Strategic Studies
-----------------------------------------------------------------------------------------------------------------------------------
Donald E. Petersen Director 1993 Retired; former Chairman of the 2 None
Age: 77 Board and CEO, Ford Motor
Company
-----------------------------------------------------------------------------------------------------------------------------------
Stefanie Powers Director 1993-1996 Actor, Producer; Co-founder and 2 None
Age: 61 1997 President, The William Holden
Wildlife Foundation;
conservation consultant, Land
Rover and Jaguar North America;
author of The Jaguar
Conservation Trust
-----------------------------------------------------------------------------------------------------------------------------------
Steadman Upham Director 2001 President and University 2 None
Age: 54 Professor of Archaeology,
Claremont Graduate University
-----------------------------------------------------------------------------------------------------------------------------------
Charles Wolf, Jr., Director 1993 Senior Economic Adviser and 2 None
Ph.D. Corporate Fellow in
Age: 79 International Economics, The
RAND Corporation; former Dean,
The RAND Graduate School
-----------------------------------------------------------------------------------------------------------------------------------

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[Enlarge/Download Table]

PRINCIPAL OCCUPATION(S) DURING
YEAR FIRST PAST 5 YEARS AND
ELECTED POSITIONS HELD NUMBER OF BOARDS
POSITION A DIRECTOR WITH AFFILIATED ENTITIES WITHIN THE FUND
WITH THE AND/OR OFFICER OR THE PRINCIPAL UNDERWRITER COMPLEX/2/ ON WHICH OTHER DIRECTORSHIPS/3/ HELD
NAME AND AGE FUND OF THE FUND/1/ OF THE FUND DIRECTOR SERVES BY DIRECTOR
-----------------------------------------------------------------------------------------------------------------------------------

"INTERESTED" DIRECTORS/4//,//5/
-----------------------------------------------------------------------------------------------------------------------------------
Gina H. Despres Chairman 1999 Senior Vice President, 4 None
Age: 62 of the Capital Research and
Board and Management Company; Vice
Director President, Capital Strategy
Research, Inc.*
-----------------------------------------------------------------------------------------------------------------------------------
Paul G. Haaga, Vice 1993 Executive Vice President and 17 None
Jr. Chairman Director, Capital Research
Age: 55 of the and Management Company;
Board and Director, The Capital Group
Director Companies, Inc.*; Director,
American Funds Distributors,
Inc.*
-----------------------------------------------------------------------------------------------------------------------------------

[Enlarge/Download Table]

PRINCIPAL OCCUPATION(S) DURING
POSITION YEAR FIRST ELECTED PAST 5 YEARS AND POSITIONS HELD
WITH THE AN OFFICER WITH AFFILIATED ENTITIES
NAME AND AGE FUND OF THE FUND/1/ OR THE PRINCIPAL UNDERWRITER OF THE FUND
-----------------------------------------------------------------------------------------------------------------------------------

OTHER OFFICERS/5/
-----------------------------------------------------------------------------------------------------------------------------------
Stephen E. President 1993 Senior Vice President, Capital Research Company*
Bepler
Age: 61
-----------------------------------------------------------------------------------------------------------------------------------
Gregg E. Ireland Executive Vice 1999 Senior Vice President, Capital Research and Management Company
Age: 54 President
-----------------------------------------------------------------------------------------------------------------------------------
Mark E. Denning Senior Vice 1993 Director, Capital Research and Management Company; Director, The
Age: 46 President Capital Group Companies, Inc.*; Senior Vice President, Capital
Research Company*
-----------------------------------------------------------------------------------------------------------------------------------
Jeanne K. Vice President 2001 Senior Vice President, Capital Research Company*
Carroll
Age: 55
-----------------------------------------------------------------------------------------------------------------------------------
Timothy P. Dunn Vice President 2003 Vice President, Capital Research and Management Company; Senior
Age: 42 Vice President, Capital Research Company*
-----------------------------------------------------------------------------------------------------------------------------------
Carl M. Kawaja Vice President 1997 Senior Vice President , Capital Research Company*; Director,
Age: 39 Capital International, Inc.*
-----------------------------------------------------------------------------------------------------------------------------------
Andrew B. Suzman Vice President 2003 Executive Vice President and Director, Capital Research Company;
Age: 36 Director, Capital International Research, Inc.*
-----------------------------------------------------------------------------------------------------------------------------------
Stephen T. Vice President 2001 Senior Vice President, Capital Research Company*
Watson
Age: 48
-----------------------------------------------------------------------------------------------------------------------------------
Vincent P. Corti Secretary 1993 Vice President - Fund Business Management Group, Capital Research
Age: 47 and Management Company
-----------------------------------------------------------------------------------------------------------------------------------
Jeffrey P. Regal Treasurer 2003 Vice President - Fund Business Management Group, Capital Research
Age: 32 and Management Company
-----------------------------------------------------------------------------------------------------------------------------------
Valerie Y. Lewis Assistant Secretary 2003 Fund Boards Specialist, Capital Research and Management Company
Age: 47
-----------------------------------------------------------------------------------------------------------------------------------
Sheryl F. Assistant Treasurer 2003 Vice President - Fund Business Management Group, Capital Research
Johnson and Management Company
Age: 35
-----------------------------------------------------------------------------------------------------------------------------------

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* Company affiliated with Capital Research and Management Company.
1 Directors and officers of the fund serve until their resignation, removal or
retirement.

2 Capital Research and Management Company manages the American Funds, consisting
of 29 funds. Capital Research and Management Company also manages American
Funds Insurance Series, which serves as the underlyinig investment vehicle for
certain variable insurance contracts, and Endowments, whose shareholders are
limited to certain non-profit organizations.
3 This includes all directorships (other than those in the American Funds) that
are held by each Director as a director of a public company or a registered
investment company.
4 "Interested persons" within the meaning of the 1940 Act on the basis of their
affiliation with the fund's investment adviser, Capital Research and
Management Company, or affiliated entities (including the fund's principal
underwriter).
5 All of the officers listed are officers and/or directors/trustees of one or
more of the other funds for which Capital Research and Management Company
serves as investment adviser.

THE ADDRESS FOR ALL DIRECTORS AND OFFICERS OF THE FUND IS 333 SOUTH HOPE STREET
- 55TH FLOOR, LOS ANGELES, CALIFORNIA 90071, ATTENTION: FUND SECRETARY.

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FUND SHARES OWNED BY DIRECTORS AS OF DECEMBER 31, 2003

[Download Table]

AGGREGATE DOLLAR RANGE/1/
OF SHARES
OWNED IN ALL FUNDS
IN THE AMERICAN FUNDS
DOLLAR RANGE/1/ OF FUND FAMILY OVERSEEN
NAME SHARES OWNED BY DIRECTOR
-------------------------------------------------------------------------------

"NON-INTERESTED" DIRECTORS
-------------------------------------------------------------------------------
H. Frederick Christie $50,001 - $100,000 Over $100,000
-------------------------------------------------------------------------------
Merit E. Janow $10,001 - $50,000 $10,001 - $50,000
-------------------------------------------------------------------------------
Mary Myers Kauppila None Over $100,000
-------------------------------------------------------------------------------
Gail L. Neale Over $100,000 Over 100,000
-------------------------------------------------------------------------------
Robert J. O'Neill None None
-------------------------------------------------------------------------------
Donald E. Petersen None None
-------------------------------------------------------------------------------
Stefanie Powers None Over $100,000
-------------------------------------------------------------------------------
Steadman Upham $10,001 - $50,000 $50,001 - $100,000
-------------------------------------------------------------------------------
Charles Wolf, Jr. Over $100,000 Over $100,000
-------------------------------------------------------------------------------
"INTERESTED" DIRECTORS/2/
-------------------------------------------------------------------------------
Gina H. Despres Over $100,000 Over $100,000
-------------------------------------------------------------------------------
Paul G. Haaga, Jr. Over $100,000 Over $100,000
-------------------------------------------------------------------------------

1 Ownership disclosure is made using the following ranges: None; $1 - $10,000;
$10,001 - $50,000; $50,001 - $100,000 and Over $100,000. The amounts listed
for "interested" Directors include shares owned through The Capital Group
Companies, Inc. retirement plan and 401(k) plan.
2 "Interested persons" within the meaning of the 1940 Act on the basis of their
affiliation with the fund's investment adviser, Capital Research and
Management Company, or affiliated entities (including the fund's principal
underwriter).

DIRECTOR COMPENSATION - No compensation is paid by the fund to any officer or
Director who is a director, officer or employee of the investment adviser or its
affiliates. The fund pays annual fees of $16,000 to Directors who are not
affiliated with the investment adviser, $1,000 for each Board of Directors
meeting attended, and $500 for each meeting attended as a member of a committee
of the Board of Directors.

No pension or retirement benefits are accrued as part of fund expenses. The
Directors may elect, on a voluntary basis, to defer all or a portion of their
fees through a deferred compensation plan in effect for the fund. The fund also
reimburses certain expenses of the Directors who are not affiliated with the
investment adviser.

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DIRECTOR COMPENSATION PAID DURING THE FISCAL YEAR ENDED NOVEMBER 30, 2003

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TOTAL COMPENSATION
AGGREGATE COMPENSATION (INCLUDING
(INCLUDING VOLUNTARILY VOLUNTARILY DEFERRED
DEFERRED COMPENSATION/1/) COMPENSATION/1/)
NAME FROM THE FUND FROM ALL FUNDS MANAGED BY
-------------------------------------------------------------------------------------------------------- CAPITAL RESEARCH AND
MANAGEMENT
COMPANY OR ITS AFFILIATES/2/
----------------------------

H. Frederick Christie/3/ $23,500 $242,035
------------------------------------------------------------------------------------------------------------------------------------
Merit E. Janow 23,500 45,000
------------------------------------------------------------------------------------------------------------------------------------
Mary Myers Kauppila/3/ 23,500 132,000
------------------------------------------------------------------------------------------------------------------------------------
Gail L. Neale 22,500 96,500
------------------------------------------------------------------------------------------------------------------------------------
Robert J. O'Neill 23,500 55,000
------------------------------------------------------------------------------------------------------------------------------------
Donald E. Petersen/3/ 23,000 45,000
------------------------------------------------------------------------------------------------------------------------------------
Stefanie Powers 20,000 39,000
------------------------------------------------------------------------------------------------------------------------------------
Steadman Upham/3/ 24,000 46,000
------------------------------------------------------------------------------------------------------------------------------------
Charles Wolf, Jr. 23,500 45,000
------------------------------------------------------------------------------------------------------------------------------------

1 Amounts may be deferred by eligible Directors under a non-qualified deferred
compensation plan adopted by the fund in 1993. Deferred amounts accumulate at
an earnings rate determined by the total return of one or more funds in the
American Funds as designated by the Directors. Compensation for the fiscal
year ended November 30, 2003 includes earnings on amounts deferred in previous
fiscal years.
2 Capital Research and Management Company manages the American Funds, consisting
of 29 funds. Capital Research and Management Company also manages American
Funds Insurance Series, which serves as the underlyinig investment vehicle for
certain variable insurance contracts, and Endowments, whose shareholders are
limited to certain non-profit organizations.
3 Since the deferred compensation plan's adoption, the total amount of deferred
compensation accrued by the fund (plus earnings thereon) through the 2003
fiscal year for participating Directors is as follows: H. Frederick Christie
($144,823), Mary Myers Kauppila ($283,730), Donald E. Petersen ($80,374) and
Steadman Upham ($53,450). Amounts deferred and accumulated earnings thereon
are not funded and are general unsecured liabilities of the fund until paid to
the Directors.

As of January 1, 2004, the officers and Directors of the fund and their
families, as a group, owned beneficially or of record less than 1% of the
outstanding shares of the fund.

FUND ORGANIZATION AND THE BOARD OF DIRECTORS - The fund, an open-end,
diversified management investment company, was organized as a Maryland
corporation on November 4, 1992. Although the Board of Directors has delegated
day-to-day oversight to the investment adviser, all fund operations are
supervised by the fund's Board, which meets periodically and performs duties
required by applicable state and federal laws.

Under Maryland law, the fund's business and affairs are managed under the
direction of the Board of Directors, and all powers of the fund are exercised by
or under the authority of the Board except as reserved to the shareholders by
law or the fund's charter or by-laws. Maryland law requires each Director to
perform his/her duties as a Director, including his/her duties as a member of
any Board committee on which he/she serves, in good faith, in a manner he/she
reasonably believes to be in the best interest of the fund, and with the care
that an ordinarily prudent person in a like position would use under similar
circumstances.

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Members of the Board who are not employed by the investment adviser or its
affiliates are paid certain fees for services rendered to the fund as described
above. They may elect to defer all or a portion of these fees through a deferred
compensation plan in effect for the fund.

The fund has several different classes of shares, including Class A, B, C, F,
529-A, 529-B, 529-C, 529-E, 529-F, R-1, R-2, R-3, R-4 and R-5 shares. The 529
share classes are available only through CollegeAmerica to investors
establishing qualified higher education savings accounts. The R share classes
are generally available only to employer-sponsored retirement plans. Class R-5
shares are also available to clients of the Personal Investment Management Group
of Capital Guardian Trust Company who do not have an intermediary associated
with their accounts and without regard to the $1 million purchase minimum. The
R share classes are described in more detail in the fund's retirement plan
prospectus and retirement plan statement of additional information.

Shares of each class represent an interest in the same investment portfolio.
Each class has pro rata rights as to voting, redemption, dividends and
liquidation, except that each class bears different distribution expenses and
may bear different transfer agent fees and other expenses properly attributable
to the particular class as approved by the Board of Directors and set forth in
the fund's rule 18f-3 Plan. Each class' shareholders have exclusive voting
rights with respect to the respective class' rule 12b-1 Plans adopted in
connection with the distribution of shares and on other matters in which the
interests of one class are different from interests in another class. Shares of
all classes of the fund vote together on matters that affect all classes in
substantially the same manner. Each class votes as a class on matters that
affect that class alone. Note that CollegeAmerica account owners are not
shareholders of the fund and accordingly, do not have the rights of a
shareholder, such as the right to vote proxies relating to fund shares. As the
legal owner of the fund's shares, the Virginia College Savings Plan will vote
any proxies relating to fund shares.

The fund does not hold annual meetings of shareholders. However, significant
matters that require shareholder approval, such as certain elections of Board
members or a change in a fundamental investment policy, will be presented to
shareholders at a meeting called for such purpose. Shareholders have one vote
per share owned. At the request of the holders of at least 10% of the shares,
the fund will hold a meeting at which any member of the Board could be removed
by a majority vote.

REMOVAL OF DIRECTORS BY SHAREHOLDERS - At any meeting of shareholders, duly
called and at which a quorum is present, shareholders may, by the affirmative
vote of the holders of a majority of the votes entitled to be cast, remove any
Director from office and may elect a successor or successors to fill any
resulting vacancies for the unexpired terms of removed Directors. The fund has
agreed, at the request of the staff of the Securities and Exchange Commission,
to apply the provisions of section 16(c) of the 1940 Act with respect to the
removal of Directors, as though the fund were a common-law trust. Accordingly,
the Directors of the fund will promptly call a meeting of shareholders for the
purpose of voting upon the removal of any Directors when requested in writing to
do so by the record holders of at least 10% of the outstanding shares.

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principal service providers. The Committee acts as a liaison between the fund's
independent auditors and the full Board of Directors. Four Audit Committee
meetings were held during the 2003 fiscal year.

The fund has a Contracts Committee comprised of H. Frederick Christie, Merit E.
Janow, Mary Myers Kauppila, Gail L. Neale, Robert J. O'Neill, Donald E.
Petersen, Stefanie Powers, Steadman Upham and Charles Wolf, Jr., none of whom is
an "interested person" of the fund within the meaning of the 1940 Act. The
Committee's function is to request, review and consider the information deemed
necessary to evaluate the terms of certain agreements between the fund and its
investment adviser or the investment adviser's affiliates, such as the
Investment Advisory and Service Agreement, Principal Underwriting Agreement,
Administrative Services Agreement and Plans of Distribution under rule 12b-1 of
the 1940 Act, that the fund may enter into, renew or continue, and to make its
recommendations to the full Board of Directors on these matters. One Contracts
Committee meeting was held during the 2003 fiscal year.

The fund has a Nominating Committee comprised of Gail L. Neale, Donald E.
Petersen, Stefanie Powers and Steadman Upham, none of whom is an "interested
person" of the fund within the meaning of the 1940 Act. The Committee
periodically reviews such issues as the Board's composition, responsibilities,
committees, compensation and other relevant issues, and recommends any
appropriate changes to the full Board of Directors. The Committee also
evaluates, selects and nominates independent director candidates to the full
Board of Directors. While the Committee normally is able to identify from its
own and other resources an ample number of qualified candidates, it will
consider shareholder suggestions of persons to be considered as nominees to fill
future vacancies on the Board. Such suggestions must be sent in writing to the
Nominating Committee of the fund, addressed to the fund's Secretary, and must be
accompanied by complete biographical and occupational data on the prospective
nominee, along with a written consent of the prospective nominee for
consideration of his or her name by the Committee. Two Nominating Committee
meetings were held during the 2003 fiscal year.

The fund has a Proxy Committee comprised of H. Frederick Christie, Merit E.
Janow, Mary Myers Kauppila, Gail L. Neale, Robert J. O'Neill, Donald E.
Petersen, Stephanie Powers, Steadman Upham and Charles Wolf, Jr., none of whom
is considered an "interested person" of the fund within the meaning of the 1940
Act. The Committee's functions include reviewing procedures and policies for
voting proxies of companies held in the fund's portfolio, monitoring certain
contested proxy voting issues, and discussing related current issues. Two Proxy
Committee meetings were held during the 2003 fiscal year.

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PRINCIPAL FUND SHAREHOLDERS - The following table identifies those investors who
own of record or are known by the fund to own beneficially 5% or more of any
class of its shares as of the opening of business on January 1, 2004:

[Download Table]

NAME AND ADDRESS OWNERSHIP PERCENTAGE
----------------------------------------------------------------------------

Edward D. Jones & Co. Class A 19.32%
201 Progress Pkwy. Class B 11.24
Maryland Heights, MO 63043-3009
----------------------------------------------------------------------------
MLPF&S For the Sole Benefit of Its Customers Class B 6.42
4800 Deer Lake Drive E., Fl. 2 Class C 16.68
Jacksonville, FL 32246-6484
----------------------------------------------------------------------------
Citigroup Global Markets Inc. Class B 5.45
333 W. 34th Street Class C 11.19
New York, NY 10001-2402
----------------------------------------------------------------------------
Charles Schwab & Co. Inc. Class F 10.34
101 Montgomery St.
San Francisco, CA 94104-4122
----------------------------------------------------------------------------

INVESTMENT ADVISER - The investment adviser, Capital Research and Management
Company, founded in 1931, maintains research facilities in the United States and
abroad (Los Angeles, San Francisco, New York, Washington, D.C., London, Geneva,
Hong Kong, Singapore and Tokyo) with a staff of professionals, many of whom have
significant investment experience. The investment adviser is located at 333
South Hope Street, Los Angeles, CA 90071, and at 135 South State College
Boulevard, Brea, CA 92821. The investment adviser's research professionals
travel several million miles a year, making more than 5,000 research visits in
more than 50 countries around the world. The investment adviser believes that it
is able to attract and retain quality personnel. The investment adviser is a
wholly owned subsidiary of The Capital Group Companies, Inc.

The investment adviser is responsible for managing more than $500 billion of
stocks, bonds and money market instruments and serves over 11 million
shareholder accounts of all types throughout the world. These investors include
individuals, privately owned businesses and large corporations as well as
schools, colleges, foundations and other non-profit and tax-exempt
organizations.

INVESTMENT ADVISORY AND SERVICE AGREEMENT - The Investment Advisory and Service
Agreement (the "Agreement") between the fund and the investment adviser will
continue in effect until November 30, 2004, unless sooner terminated, and may be
renewed from year to year thereafter, provided that any such renewal has been
specifically approved at least annually by: (i) the Board of Directors, or by
the vote of a majority (as defined in the 1940 Act) of the outstanding voting
securities of the fund, and (ii) the vote of a majority of Directors who are not
parties to the Agreement or interested persons (as defined in the 1940 Act) of
any such party, cast in person at a meeting called for the purpose of voting on
such approval. The Agreement provides that the investment adviser has no
liability to the fund for its acts or omissions in the performance of its
obligations to the fund not involving willful misconduct, bad faith, gross
negligence or reckless disregard of its obligations under the Agreement. The
Agreement also provides that either party has the right to terminate it, without
penalty, upon 60 days' written

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notice to the other party, and that the Agreement automatically terminates in
the event of its assignment (as defined in the 1940 Act).

In considering the renewal of the Agreement each year, the Contracts Committee
of the Board of Directors evaluates information provided by the investment
adviser in accordance with Section 15(c) of the 1940 Act, and presents its
recommendations to the full Board of Directors.

At its most recent meeting, the Committee gave consideration to a wide variety
of factors, including, among others, the fund's relatively favorable investment
results, both on an absolute basis and relative to select indexes and to other
mutual funds with similar investment objectives; the fact that the fund's
advisory fees and overall expense ratios were among the lowest of its peer
group; the various management and administrative services provided by the
investment adviser; the financial results of the investment adviser; and the
strength, reputation, quality and depth of experience of the investment adviser
and its investment and administrative personnel. The Committee's action in
recommending approval of the Agreement reflects the Committee's determination
that the advisory fees and other expenses paid by the fund are fair and that
shareholders have received reasonable value in return for such fees and
expenses.

The investment adviser, in addition to providing investment advisory services,
furnishes the services and pays the compensation and travel expenses of persons
to perform the fund's executive, administrative, clerical and bookkeeping
functions, and provides suitable office space, necessary small office equipment
and utilities, general purpose accounting forms, supplies, and postage used at
the fund's offices. The fund pays all expenses not assumed by the investment
adviser, including, but not limited to: custodian, stock transfer and dividend
disbursing fees and expenses; shareholder recordkeeping and administrative
expenses; costs of the designing, printing and mailing of reports, prospectuses,
proxy statements, and notices to its shareholders; taxes; expenses of the
issuance and redemption of fund shares (including stock certificates,
registration and qualification fees and expenses); expenses pursuant to the
fund's Plans of Distribution (described below); legal and auditing expenses;
compensation, fees and expenses paid to Directors unaffiliated with the
investment adviser; association dues; costs of stationery and forms prepared
exclusively for the fund; and costs of assembling and storing shareholder
account data.

As compensation for its services, the investment adviser receives a monthly fee
which is accrued daily, calculated at the 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.

The investment adviser has agreed that in the event the Class A expenses of the
fund (with the exclusion of interest, taxes, brokerage costs, distribution
expenses pursuant to a plan under rule 12b-1 and extraordinary expenses such as
litigation and acquisitions or other expenses excludable under applicable state
securities laws or regulations) for any fiscal year ending on a date on which
the Agreement is in effect, exceed the expense limitations, if any, applicable
to the fund pursuant to state securities laws or any related regulations, it
will reduce its fee by the extent of such excess and, if required pursuant to
any such laws or any regulations thereunder, will reimburse the fund in the
amount of such excess. To the extent the fund's management fee must

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be waived due to Class A share expense ratios exceeding the above limit,
management fees will be reduced similarly for all classes of shares of the fund,
or other Class A fees will be waived in lieu of management fees.

For the fiscal years ended November 30, 2003, 2002 and 2001, the investment
adviser received from the fund advisory fees of $50,748,000, $44,829,000 and
$45,794,000, respectively.

ADMINISTRATIVE SERVICES AGREEMENT - The Administrative Services Agreement (the
"Administrative Agreement") between the fund and the investment adviser relating
to the fund's Class C, F and 529 shares will continue in effect until October
31, 2004, unless sooner terminated, and may be renewed from year to year
thereafter, provided that any such renewal has been specifically approved at
least annually by the vote of a majority of Directors who are not parties to the
Administrative Agreement or interested persons (as defined in the 1940 Act) of
any such party, cast in person at a meeting called for the purpose of voting on
such approval. The Administrative Agreement provides that the fund may terminate
the agreement at any time by vote of a majority of Directors who are not
interested persons of the fund. The investment adviser has the right to
terminate the Administrative Agreement upon 60 days' written notice to the fund.
The Administrative Agreement automatically terminates in the event of its
assignment (as defined in the 1940 Act).

Under the Administrative Agreement, the investment adviser provides certain
transfer agent and administrative services for shareholders of the fund's Class
C and F shares, and all Class 529 shares. The investment adviser contracts with
third parties, including American Funds Service Company, the fund's Transfer
Agent, to provide these services. Services include, but are not limited to,
shareholder account maintenance, transaction processing, tax information
reporting and shareholder and fund communications. In addition, the investment
adviser monitors, coordinates and oversees the activities performed by third
parties providing such services.

As compensation for its services, the investment adviser receives transfer agent
fees for transfer agent services provided to the fund's applicable share
classes. Transfer agent fees are paid monthly according to a fee schedule
contained in a Shareholder Services Agreement between the fund and American
Funds Service Company. The investment adviser also receives an administrative
services fee for administrative services provided to the fund's applicable share
classes. Administrative services fees are paid monthly, accrued daily and
calculated at the annual rate of 0.15% of the average daily net assets of each
share class, as applicable.

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During the 2003 fiscal period, administrative services fees were:

[Enlarge/Download Table]

ADMINISTRATIVE SERVICES FEE
------------------------------------------------------------------------------------------------------------

CLASS C $545,000
------------------------------------------------------------------------------------------------------------
CLASS F 440,000
------------------------------------------------------------------------------------------------------------
CLASS 529-A 85,000
------------------------------------------------------------------------------------------------------------
CLASS 529-B 21,000
------------------------------------------------------------------------------------------------------------
CLASS 529-C 33,000
------------------------------------------------------------------------------------------------------------
CLASS 529-E 4,000
------------------------------------------------------------------------------------------------------------
CLASS 529-F 1,000
------------------------------------------------------------------------------------------------------------

PRINCIPAL UNDERWRITER AND PLANS OF DISTRIBUTION - American Funds Distributors,
Inc. (the "Principal Underwriter") is the principal underwriter of the fund's
shares. The Principal Underwriter is located at 333 South Hope Street, Los
Angeles, CA 90071; 135 South State College Boulevard, Brea, CA 92821; 3500
Wiseman Boulevard, San Antonio, TX 78251; 8332 Woodfield Crossing Boulevard,
Indianapolis, IN 46240; and 5300 Robin Hood Road, Norfolk, VA 23513.

The Principal Underwriter receives revenues from sales of the fund's shares. For
Class A and 529-A shares, the Principal Underwriter receives commission revenue
consisting of that portion of the Class A and 529-A sales charge remaining after
the allowances by the Principal Underwriter to investment dealers. For Class B
and 529-B shares, the Principal Underwriter sells the rights to the 12b-1 fees
paid by the fund for distribution expenses to a third party and receives the
revenue remaining after compensating investment dealers for sales of Class B and
529-B shares. The fund also pays the Principal Underwriter for advancing the
immediate service fees paid to qualified dealers of Class B and 529-B shares.
For Class C and 529-C shares, the Principal Underwriter receives any contingent
deferred sales charges that apply during the first year after purchase. The fund
pays the Principal Underwriter for advancing the immediate service fees and
commissions paid to qualified dealers of Class C and 529-C shares. For Class
529-E shares, the fund pays the Principal Underwriter for advancing the
immediate service fees and commissions paid to qualified dealers. For Class F
and 529-F shares, the fund pays the Principal Underwriter for advancing the
immediate service fees paid to qualified dealers and advisers who sell Class F
and 529-F shares.

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Commissions, revenue or service fees retained by the Principal Underwriter after
allowances or compensation to dealers were:

[Enlarge/Download Table]

COMMISSIONS, ALLOWANCE OR

REVENUE COMPENSATION

FISCAL YEAR/PERIOD OR FEES RETAINED TO DEALERS
-----------------------------------------------------------------------------------------------------

CLASS A 2003 $9,959,000 $44,742,000
2002 4,733,000 21,525,000
2001 3,830,000 17,529,000
CLASS B 2003 1,025,000 8,607,000
2002 885,000 4,509,000
2001 642,000 3,222,000
-----------------------------------------------------------------------------------------------------
CLASS 529-A 2003 266,000 1,267,000
2002 142,000 666,000
-----------------------------------------------------------------------------------------------------
CLASS 529-B 2003 62,000 374,000
2002 29,000 211,000
-----------------------------------------------------------------------------------------------------

The fund has adopted Plans of Distribution (the "Plans") pursuant to rule 12b-1
under the 1940 Act. The Principal Underwriter receives amounts payable pursuant
to the Plans (see below). As required by rule 12b-1 and the 1940 Act, the Plans
(together with the Principal Underwriting Agreement) have been approved by the
full Board of Directors and separately by a majority of the Directors who are
not "interested persons" of the fund and who have no direct or indirect
financial interest in the operation of the Plans or the Principal Underwriting
Agreement. Potential benefits of the Plans to the fund include: quality
shareholder services; savings to the fund in transfer agency costs; benefits to
the investment process from growth or stability of assets; and maintenance of a
financially healthy management organization. The selection and nomination of
Directors who are not "interested persons" of the fund are committed to the
discretion of the Directors who are not "interested persons" during the
existence of the Plans. The Plans may not be amended to increase materially the
amount spent for distribution without shareholder approval. Plan expenses are
reviewed quarterly and the Plans must be renewed annually by the Board of
Directors.

Under the Plans, the fund may annually expend the following amounts to finance
any activity primarily intended to result in the sale of fund shares, provided
the fund's Board of Directors has approved the category of expenses for which
payment is being made: (i) for Class A shares, up to 0.30% of the average daily
net assets attributable to Class A shares; (ii) for Class 529-A shares, up to
0.50% of the average daily net assets attributable to Class 529-A shares; (iii)
for Class B and 529-B shares, 1.00% of the average daily net assets attributable
to Class B and 529-B shares, respectively; (iv) for Class C and 529-C shares,
1.00% of the average daily net assets attributable to Class C and 529-C shares,
respectively; (v) for Class 529-E shares, up to 0.75% of

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the average daily net assets attributable to Class 529-E shares; and (vi) for
Class F and 529-F shares, up to 0.50% of the average daily net assets
attributable to Class F and 529-F shares, respectively.

For Class A and 529-A shares: (i) up to 0.25% is reimbursed to the Principal
Underwriter for paying service-related expenses, including paying service fees
to qualified dealers, and (ii) up to the amount allowable under the fund's Class
A and 529-A 12b-1 limit is reimbursed to the Principal Underwriter for paying
distribution-related expenses, including for Class A and 529-A shares dealer
commissions and wholesaler compensation paid on sales of shares of $1 million or
more purchased without a sales charge (including purchases by employer-sponsored
defined contribution-type retirement plans investing $1 million or more or with
100 or more eligible employees, and retirement plans, endowments and foundations
with $50 million or more in assets) ("no load purchases"). Commissions on no
load purchases of Class A and 529-A shares, in excess of the Class A and 529-A
Plan limitations not reimbursed to the Principal Underwriter during the most
recent fiscal quarter are recoverable for five quarters, provided that such
commissions do not exceed the annual expense limit. After five quarters these
commissions are not recoverable.

For Class B and 529-B shares: (i) 0.25% is paid to the Principal Underwriter for
paying service-related expenses, including paying service fees to qualified
dealers, and (ii) 0.75% is paid to the Principal Underwriter for
distribution-related expenses, including the financing of commissions paid to
qualified dealers.

For Class C and 529-C shares: (i) 0.25% is paid to the Principal Underwriter for
paying service-related expenses, including paying service fees to qualified
dealers, and (ii) 0.75% is paid to the Principal Underwriter for paying
distribution-related expenses, including commissions paid to qualified dealers.

For Class 529-E shares: (i) 0.25% is paid to the Principal Underwriter for
paying service-related expenses, including paying service fees to qualified
dealers, and (ii) 0.25% is paid to the Principal Underwriter for paying
distribution-related expenses, including commissions paid to qualified dealers.

For Class F and 529-F shares, 0.25% is paid to the Principal Underwriter for
paying service-related expenses, including paying service fees to qualified
dealers or advisers. Currently, no compensation is paid under the fund's Class F
and 529-F Plans for distribution-related expenses.

Capital World Growth and Income Fund - Page 23

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During the 2003 fiscal year, 12b-1 expenses accrued and paid, and if applicable,
unpaid, were:

[Download Table]

12B-1 LIABILITY
12B-1 EXPENSES OUTSTANDING
------------------------------------------------------------------------------

CLASS A $28,180,000 $5,984,000
------------------------------------------------------------------------------
CLASS B 3,157,000 496,000
------------------------------------------------------------------------------
CLASS C 2,988,000 701,000
------------------------------------------------------------------------------
CLASS F 622,000 218,000
------------------------------------------------------------------------------
CLASS 529-A 71,000 15,000
------------------------------------------------------------------------------
CLASS 529-B 101,000 16,000
------------------------------------------------------------------------------
CLASS 529-C 163,000 36,000
------------------------------------------------------------------------------
CLASS 529-E 14,000 5,000
------------------------------------------------------------------------------
CLASS 529-F 2,000 1,000
------------------------------------------------------------------------------

OTHER COMPENSATION TO DEALERS - American Funds Distributors, at its expense,
currently provides additional compensation to investment dealers. These payments
may be made, at the discretion of American Funds Distributors, to the top 75
dealers who have sold shares of the American Funds. The level of payments made
to a qualifying dealer in any given year will vary and in no case would exceed
the sum of (a) 0.10% of the previous year's fund sales by that dealer and (b)
0.02% of assets attributable to that dealer. For 2004, aggregate payments made
by American Funds Distributors to dealers will equal approximately 0.02% of the
assets of the American Funds. A number of factors will be considered in
determining payments, including the qualifying dealer's sales, assets and
redemption rates, and the quality of the dealer's relationship with American
Funds Distributors. American Funds Distributors makes these payments to help
defray the costs incurred by qualifying dealers in connection with efforts to
educate financial advisers about the American Funds so that they can make
recommendations and provide services that are suitable and meet shareholder
needs. American Funds Distributors will, on an annual basis, determine the
advisability of continuing these payments. American Funds Distributors may also
pay expenses associated with meetings that facilitate educating financial
advisers and shareholders about the American Funds that are conducted by
dealers, including those outside the top 75 firms.

As of January 2004, the top dealers that American Funds Distributors anticipates
will receive additional compensation include:

1717 Capital Management Company
A. G. Edwards & Sons, Inc.
AIG/SunAmerica Group
American General/Franklin Financial
Ameritas/The Advisors Group
AXA Advisors, LLC
Baird/NMIS Group
Cadaret, Grant & Co., Inc.
Cambridge Investment Research, Inc.
Capital Analysts, Inc.
Commonwealth Financial Network
Cuna Brokerage Services, Inc.
Deutsche Bank Securities Inc.
Edward Jones
Ferris, Baker Watts, Inc.
GE Independent Accountant Network
Hefren-Tillotson, Inc.
Hornor, Townsend & Kent, Inc.
ING Advisors Network
InterSecurities, Inc.
Investacorp, Inc.
Janney Montgomery Scott LLC
Jefferson Pilot Securities Corporation
JJB Hilliard/PNC Bank
Legg Mason Wood Walker, Inc.
Lincoln Financial Advisors Corporation
Linsco/Private Ledger Corp.
McDonald Investments/Society National Bank
Merrill Lynch, Pierce, Fenner & Smith Inc.
Metlife Enterprises
MML Investors Services, Inc.
Morgan Keegan & Company, Inc.
NatCity Investment, Inc.
National Planning Holdings
NFP Securities, Inc.
PacLife Group
Park Avenue Securities LLC
Princor/PPI
ProEquities, Inc.
Raymond James Group
RBC Dain Rauscher Inc.
Securian/C.R.I.
Securities Service Network Inc.
Signator Investors, Inc.
Smith Barney
Stifel, Nicolaus & Company, Inc.
The O.N. Equity Sales Company
UBS Financial Services Inc.
US Bancorp Piper Jaffray Group
Wachovia Group
WS Griffith Securities, Inc.

TAXES AND DISTRIBUTIONS

FUND TAXATION - The fund has elected to be treated as a regulated investment
company under Subchapter M of the Internal Revenue Code (the "Code"). A
regulated investment company qualifying under Subchapter M of the Code is
required to distribute to its shareholders at least 90% of its investment
company taxable income (including the excess of net short-term capital gain over
net long-term capital losses) and generally is not subject to federal income tax
to the extent that it distributes annually 100% of its investment company
taxable income and net realized capital gains in the manner required under the
Code. The fund intends to distribute annually all of its investment company
taxable income and net realized capital gains and therefore does not expect to
pay federal income tax, although in certain circumstances, the fund may
determine that it is in the interest of shareholders to distribute less than
that amount.

To be treated as a regulated investment company under Subchapter M of the Code,
the fund must also (a) derive at least 90% of its gross income from dividends,
interest, payments with respect to securities loans and gains from the sale or
other disposition of securities or foreign currencies, or other income
(including, but not limited to, gains from options, futures or forward
contracts) derived with respect to the business of investing in such securities
or currencies, and (b) diversify its holdings so that, at the end of each fiscal
quarter, (i) at least 50% of the market value of the fund's assets is
represented by cash, U.S. government securities and securities of other
regulated investment companies, and other securities (for purposes of this
calculation, generally limited in respect of any one issuer, to an amount not
greater than 5% of the market value of the fund's assets and 10% of the
outstanding voting securities of such issuer) and (ii) not more than 25% of the
value of its assets is invested in the securities of any one issuer (other than
U.S. government securities or the securities of other regulated investment
companies), or two or more issuers which the fund controls and which are
determined to be engaged in the same or similar trades or businesses.

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Under the Code, a nondeductible excise tax of 4% is imposed on the excess of a
regulated investment company's "required distribution" for the calendar year
ending within the regulated investment company's taxable year over the
"distributed amount" for such calendar year. The term "required distribution"
means the sum of (i) 98% of ordinary income (generally net investment income)
for the calendar year, (ii) 98% of capital gain (both long-term and short-term)
for the one-year period ending on October 31 (as though the one-year period
ending on October 31 were the regulated investment company's taxable year), and
(iii) the sum of any untaxed, undistributed net investment income and net
capital gains of the regulated investment company for prior periods. The term
"distributed amount" generally means the sum of (i) amounts actually distributed
by the fund from its current year's ordinary income and capital gain net income
and (ii) any amount on which the fund pays income tax during the periods
described above. Although the fund intends to distribute its net investment
income and net capital gains so as to avoid excise tax liability, the fund may
determine that it is in the interest of shareholders to distribute a lesser
amount.

The following information may not apply to you if you hold fund shares in a
tax-deferred account, such as a retirement plan or education savings account.
Please see your tax adviser for more information.

DIVIDENDS AND CAPITAL GAIN DISTRIBUTIONS - Dividends and capital gain
distributions on fund shares will be reinvested in shares of the fund of the
same class, unless shareholders indicate in writing that they wish to receive
them in cash or in shares of the same class of other American Funds, as provided
in the prospectus. Dividends and capital gain distributions by 529 share classes
will be automatically reinvested.

Distributions of investment company taxable income and net realized capital
gains to individual shareholders will be taxable whether received in shares or
in cash. Shareholders electing to receive distributions in the form of
additional shares will have a cost basis for federal income tax purposes in each
share so received equal to the net asset value of that share on the reinvestment
date.

DIVIDENDS - The fund intends to follow the practice of distributing
substantially all of its investment company taxable income, which includes
any excess of net realized short-term gains over net realized long-term
capital losses. Investment company taxable income generally includes
dividends, interest, net short-term capital gains in excess of net
long-term capital losses, and certain foreign currency gains, if any, less
expenses and certain foreign currency losses. To the extent the fund
invests in stock of domestic and certain foreign corporations, it may
receive "qualified dividends". The fund will designate the amount of
"qualified dividends" to its shareholders in a notice sent within 60 days
of the close of its fiscal year and will report "qualified dividends" to
shareholders on Form 1099-DIV.

Under the Code, gains or losses attributable to fluctuations in exchange
rates which occur between the time the fund accrues receivables or
liabilities denominated in a foreign currency and the time the fund
actually collects such receivables, or pays such liabilities, generally are
treated as ordinary income or ordinary loss. Similarly, on disposition of
debt securities denominated in a foreign currency and on disposition of
certain futures contracts, forward contracts and options, gains or losses
attributable to fluctuations in the value of foreign currency between the
date of acquisition of the security or contract and the date of disposition
are also treated as ordinary gain or loss. These gains or losses,

Capital World Growth and Income Fund - Page 25

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referred to under the Code as "Section 988" gains or losses, may increase
or decrease the amount of the fund's investment company taxable income to
be distributed to its shareholders as ordinary income.

If the fund invests in stock of certain passive foreign investment
companies, the fund may be subject to U.S. federal income taxation on a
portion of any "excess distribution" with respect to, or gain from the
disposition of, such stock. The tax would be determined by allocating such
distribution or gain ratably to each day of the fund's holding period for
the stock. The distribution or gain so allocated to any taxable year of the
fund, other than the taxable year of the excess distribution or
disposition, would be taxed to the fund at the highest ordinary income rate
in effect for such year, and the tax would be further increased by an
interest charge to reflect the value of the tax deferral deemed to have
resulted from the ownership of the foreign company's stock. Any amount of
distribution or gain allocated to the taxable year of the distribution or
disposition would be included in the fund's investment company taxable
income and, accordingly, would not be taxable to the fund to the extent
distributed by the fund as a dividend to its shareholders.

To avoid such tax and interest, the fund intends to elect to treat these
securities as sold on the last day of its fiscal year and recognize any
gains for tax purposes at that time. Under this election, deductions for
losses are allowable only to the extent of any prior recognized gains, and
both gains and losses will be treated as ordinary income or loss. The fund
will be required to distribute any resulting income, even though it has not
sold the security and received cash to pay such distributions. Upon
disposition of these securities, any gain recognized is treated as ordinary
income and loss is treated as ordinary loss to the extent of any prior
recognized gain.

Dividends from domestic corporations are expected to comprise some portion
of the fund's gross income. To the extent that such dividends constitute
any of the fund's gross income, a portion of the income distributions of
the fund may be eligible for the deduction for dividends received by
corporations. Corporate shareholders will be informed of the portion of
dividends which so qualify. The dividends-received deduction is reduced to
the extent that either the fund shares, or the underlying shares of stock
held by the fund, with respect to which dividends are received, are treated
as debt-financed under federal income tax law and is eliminated if the
shares are deemed to have been held by the shareholder or the fund, as the
case may be, for less than 46 days during the 90-day period beginning on
the date which is 45 days before the date on which the shares become
ex-dividend. Capital gain distributions are not eligible for the
dividends-received deduction.

A portion of the difference between the issue price of zero coupon
securities and their face value ("original issue discount") is considered
to be income to the fund each year, even though the fund will not receive
cash interest payments from these securities. This original issue discount
(imputed income) will comprise a part of the investment company taxable
income of the fund which must be distributed to shareholders in order to
maintain the qualification of the fund as a regulated investment company
and to avoid federal income taxation at the level of the fund.

In addition, some of the bonds may be purchased by the fund at a discount
that exceeds the original issue discount on such bonds, if any. This
additional discount represents market discount for federal income tax
purposes. The gain realized on the disposition of

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any bond having a market discount may be treated as taxable ordinary income
to the extent it does not exceed the accrued market discount on such bond
or a fund may elect to include the market discount in income in tax years
to which it is attributable. Generally, accrued market discount may be
figured under either the ratable accrual method or constant interest
method. If the fund has paid a premium over the face amount of a bond, the
fund has the option of either amortizing the premium until bond maturity
and reducing the fund's basis in the bond by the amortized amount, or not
amortizing and treating the premium as part of the bond's basis. In the
case of any debt security having a fixed maturity date of not more than one
year from its date of issue, the gain realized on disposition generally
will be treated as a short-term capital gain. In general, any gain realized
on disposition of a security held less than one year is treated as a
short-term capital gain.

Dividend and interest income received by the fund from sources outside the
United States may be subject to withholding and other taxes imposed by such
foreign jurisdictions. Tax conventions between certain countries and the
United States may reduce or eliminate these foreign taxes, however. Most
foreign countries do not impose taxes on capital gains in respect of
investments by foreign investors.

CAPITAL GAIN DISTRIBUTIONS - The fund also intends to follow the practice
of distributing the entire excess of net realized long-term capital gains
over net realized short-term capital losses. Net capital gains for a fiscal
year are computed by taking into account any capital loss carry-forward of
the fund.

If any net long-term capital gains in excess of net short-term capital
losses are retained by the fund for reinvestment, requiring federal income
taxes to be paid thereon by the fund, the fund intends to elect to treat
such capital gains as having been distributed to shareholders. As a result,
each shareholder will report such capital gains as long-term capital gains
taxable to individual shareholders at a maximum 15% capital gains rate
(maximum 20% for capital gains realized by the fund prior to May 6, 2003),
will be able to claim a pro rata share of federal income taxes paid by the
fund on such gains as a credit against personal federal income tax
liability, and will be entitled to increase the adjusted tax basis on fund
shares by the difference between a pro rata share of the retained gains and
such shareholder's related tax credit.

SHAREHOLDER TAXATION - In January of each year, individual shareholders of the
fund will receive a statement of the federal income tax status of all
distributions. Shareholders of the fund also may be subject to state and local
taxes on distributions received from the fund.

DIVIDENDS - Fund dividends are taxable to shareholders as ordinary income.
Under the 2003 Tax Act, all or a portion of a fund's dividend distribution
may be a "qualified dividend". Only fund dividends derived from qualified
corporation dividends paid to the fund after December 31, 2002, and held by
the fund for the appropriate holding period, will be distributed to
shareholders as "qualified dividends". Interest income from bonds and money
market instruments and nonqualified foreign dividends will be distributed
to shareholders as nonqualified fund dividends. The fund will report on
Form 1099-DIV the amount of each shareholder's dividend that may be treated
as a "qualified dividend". If a shareholder meets the requisite holding
period requirement, "qualified dividends" are taxable at a maximum tax rate
of 15%.

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CAPITAL GAINS - Distributions of the excess of net long-term capital gains
over net short-term capital losses which the fund properly designates as
"capital gain dividends" generally will be taxable to individual
shareholders. Regardless of the length of time the shares of the fund have
been held by such shareholders, the portion of a capital gain distribution
realized by the fund prior to May 6, 2003 is subject to a maximum tax rate
of 20%, while the portion of a capital gain distribution realized by the
fund on or after May 6, 2003 is subject to a maximum tax rate of 15%. The
fund will report on Form 1099-DIV the portion of the overall capital gain
distribution that is taxable to individual shareholders at the maximum 15%
rate. Any loss realized upon the redemption of shares held at the time of
redemption for six months or less from the date of their purchase will be
treated as a long-term capital loss to the extent of any amounts treated as
distributions of long-term capital gains during such six-month period.

Distributions by the fund result in a reduction in the net asset value of the
fund's shares. Investors should consider the tax implications of buying shares
just prior to a distribution. The price of shares purchased at that time
includes the amount of the forthcoming distribution. Those purchasing just prior
to a distribution will subsequently receive a partial return of their investment
capital upon payment of the distribution, which will be taxable to them.

The fund may make the election permitted under Section 853 of the Code so that
shareholders may (subject to limitations) be able to claim a credit or deduction
on their federal income tax returns for, and will be required to treat as part
of the amounts distributed to them, their pro rata portion of qualified taxes
paid by the fund to foreign countries (such taxes relate primarily to investment
income). The fund may make an election under Section 853 of the Code, provided
that more than 50% of the value of the total assets of the fund at the close of
the taxable year consists of securities of foreign corporations. The foreign tax
credit available to shareholders is subject to certain limitations imposed by
the Code.

Redemptions of shares, including exchanges for shares of other American Funds,
may result in federal, state and local tax consequences (gain or loss) to the
shareholder. However, conversion from one class to another class in the same
fund should not be a taxable event.

If a shareholder exchanges or otherwise disposes of shares of the fund within 90
days of having acquired such shares, and if, as a result of having acquired
those shares, the shareholder subsequently pays a reduced sales charge for
shares of the fund, or of a different fund, the sales charge previously incurred
in acquiring the fund's shares will not be taken into account (to the extent
such previous sales charges do not exceed the reduction in sales charges) for
the purposes of determining the amount of gain or loss on the exchange, but will
be treated as having been incurred in the acquisition of such other funds. Also,
any loss realized on a redemption or exchange of shares of the fund will be
disallowed to the extent substantially identical shares are reacquired within
the 61-day period beginning 30 days before and ending 30 days after the shares
are disposed of.

The fund will be required to report to the IRS all distributions of investment
company taxable income and capital gains as well as gross proceeds from the
redemption or exchange of fund shares, except in the case of certain exempt
shareholders. Under the backup withholding provisions of Section 3406 of the
Code, distributions of investment company taxable income and capital gains and
proceeds from the redemption or exchange of a regulated investment company may
be subject to backup withholding of federal income tax in the case of non-exempt
U.S. shareholders who fail to furnish the investment company with their taxpayer
identification

Capital World Growth and Income Fund - Page 28

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numbers and with required certifications regarding their status under the
federal income tax law. Withholding may also be required if the fund is notified
by the IRS or a broker that the taxpayer identification number furnished by the
shareholder is incorrect or that the shareholder has previously failed to report
interest or dividend income. If the withholding provisions are applicable, any
such distributions and proceeds, whether taken in cash or reinvested in
additional shares, will be reduced by the amounts required to be withheld.

The foregoing discussion of U.S. federal income tax law relates solely to the
application of that law to U.S. persons, i.e., U.S. citizens and residents and
U.S. corporations, partnerships, trusts and estates. Each shareholder who is not
a U.S. person should consider the U.S. and foreign tax consequences of ownership
of shares of the fund, including the possibility that such a shareholder may be
subject to a U.S. withholding tax at a rate of 30% (or a lower rate under an
applicable income tax treaty) on dividend income received by the shareholder.

Shareholders should consult their tax advisers about the application of federal,
state and local tax law in light of their particular situation.

Capital World Growth and Income Fund - Page 29

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UNLESS OTHERWISE NOTED, ALL REFERENCES IN THE FOLLOWING PAGES TO CLASS A, B, C
OR F SHARES ALSO REFER TO THE CORRESPONDING CLASS 529-A, 529-B, 529-C OR 529-F
SHARES. CLASS 529 SHAREHOLDERS SHOULD ALSO REFER TO THE COLLEGEAMERICA PROGRAM
DESCRIPTION FOR INFORMATION ON POLICIES AND SERVICES SPECIFICALLY RELATING TO
COLLEGEAMERICA ACCOUNTS.

PURCHASE OF SHARES

[Download Table]

METHOD INITIAL INVESTMENT ADDITIONAL INVESTMENTS
-------------------------------------------------------------------------------

See "Purchase $50 minimum (except where a
Minimums" for initial lower minimum is noted under
investment minimums. "Purchase Minimums").
-------------------------------------------------------------------------------
By contacting Visit any investment Mail directly to your
your investment dealer dealer who is investment dealer's address
registered in the printed on your account
state where the statement.
purchase is made, has
a sales agreement with
American Funds
Distributors and is
authorized to sell a
CollegeAmerica account
in the case of 529
shares.
-------------------------------------------------------------------------------
By mail Make your check Fill out the account additions
payable to the fund form at the bottom of a recent
and mail to the account statement, make your
address indicated on check payable to the fund,
the account write your account number on
application. Please your check, and mail the check
indicate an investment and form in the envelope
dealer on the account provided with your account
application. statement.
-------------------------------------------------------------------------------
By telephone Please contact your Complete the "Investments by
investment dealer to Phone" section on the account
open an account, then application or American
follow the procedures FundsLink Authorization Form.
for additional Once you establish the
investments. privilege, you, your financial
adviser or any person with your
account information can call
American FundsLine(R) and make
investments by telephone
(subject to conditions noted in
"Shareholder Account Services
and Privileges - Telephone and
Internet Purchases, Redemptions
and Exchanges" below).
-------------------------------------------------------------------------------
By Internet Please contact your Complete the American FundsLink
investment dealer to Authorization Form. Once you
open an account, then establish the privilege, you,
follow the procedures your financial adviser or any
for additional person with your account
investments. information may access American
FundsLine OnLine(R) on the
Internet and make investments
by computer (subject to
conditions noted in
"Shareholder Account Services
and Privileges - Telephone and
Internet Purchases, Redemptions
and Exchanges" below).
-------------------------------------------------------------------------------
By wire Call 800/421-0180 to Your bank should wire your
obtain your account additional investments in the
number(s), if same manner as described under
necessary. Please "Initial Investment."
indicate an investment
dealer on the account.
Instruct your bank to
wire funds to:

Wells Fargo Bank
155 Fifth Street,
Sixth Floor
San Francisco, CA
94106
(ABA#121000248)

For credit to the
account of:
American Funds Service
Company
a/c# 4600-076178
(fund name)
(your fund acct. no.)
-------------------------------------------------------------------------------

Capital World Growth and Income Fund - Page 30

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The fund and the Principal Underwriter reserve the right to reject any purchase
order. Generally, Class F shares are available only to fee-based programs of
investment firms that have special agreements with the fund's distributor and
certain registered investment advisers. Class B and C shares generally are not
available to certain employer-sponsored retirement plans, such as 401(k) plans,
457 plans, employer-sponsored 403(b) plans and money purchase pension and profit
sharing plans. Class 529 shares may be purchased by investors only through
CollegeAmerica accounts. Class 529-E shares may be purchased only by investors
participating in CollegeAmerica through an eligible employer plan. In addition,
the state tax-exempt funds are offered only in certain states, and tax-exempt
funds in general should not serve as retirement plan investments.

PURCHASE MINIMUMS - The minimum initial investment for all American Funds,
except the money market funds and the state tax-exempt funds, is $250. The
minimum initial investment for the money market funds (The Cash Management Trust
of America, The Tax-Exempt Money Fund of America, and The U.S. Treasury Money
Fund of America) and the state tax-exempt funds (The Tax-Exempt Fund of
California, The Tax-Exempt Fund of Maryland, and The Tax-Exempt Fund of
Virginia) is $1,000. Purchase minimums are reduced to $50 for purchases through
"Automatic Investment Plans" (except for the money market funds) or to $25 for
purchases by retirement plans through payroll deduction or by employer-sponsored
CollegeAmerica accounts and may be reduced or waived for shareholders of other
funds in the American Funds. The minimum is $50 for additional investments
(except for retirement plan payroll deduction and employer-sponsored
CollegeAmerica accounts as noted above).

PURCHASE MAXIMUM FOR CLASS B SHARES - The maximum purchase order for Class B
shares for all American Funds is $100,000. Direct purchases of Class B shares of
The Cash Management Trust of America are not permitted; shares may be acquired
only by exchanging from Class B shares of other American Funds. For investments
above $100,000, Class A shares are generally a less expensive option over time
due to sales charge reductions or waivers.

PURCHASE MAXIMUM FOR CLASS C SHARES - The maximum purchase order for Class C
shares for all American Funds is $500,000. Direct purchases of Class C shares of
The Cash Management Trust of America are not permitted; shares may be acquired
only by exchanging from Class C shares of other American Funds.

FUND NUMBERS - Here are the fund numbers for use with our automated telephone
line, American FundsLine/(R)/ (see description below):

[Enlarge/Download Table]

FUND NUMBERS
----------------------------------------
FUND CLASS A CLASS B CLASS C CLASS F
----------------------------------------------------------------------------------------------

STOCK AND STOCK/BOND FUNDS
AMCAP Fund/(R)/ . . . . . . . . . . . . . . . . . . 002 202 302 402
American Balanced Fund/(R)/ . . . . . . . . . . . . 011 211 311 411
American Mutual Fund/(R)/ . . . . . . . . . . . . . 003 203 303 403
Capital Income Builder/(R)/ . . . . . . . . . . . . 012 212 312 412
Capital World Growth and Income Fund/SM/ . . . . . 033 233 333 433
EuroPacific Growth Fund/(R)/ . . . . . . . . . . . 016 216 316 416
Fundamental Investors/SM/ . . . . . . . . . . . . . 010 210 310 410
The Growth Fund of America/(R)/ . . . . . . . . . . 005 205 305 405
The Income Fund of America/(R)/ . . . . . . . . . . 006 206 306 406
The Investment Company of America/(R)/ . . . . . . 004 204 304 404
The New Economy Fund/(R)/ . . . . . . . . . . . . . 014 214 314 414
New Perspective Fund/(R)/ . . . . . . . . . . . . . 007 207 307 407
New World Fund/SM/ . . . . . . . . . . . . . . . . 036 236 336 436
SMALLCAP World Fund/(R)/ . . . . . . . . . . . . . 035 235 335 435
Washington Mutual Investors Fund/SM/ . . . . . . . 001 201 301 401
BOND FUNDS
American High-Income Municipal Bond Fund/(R)/ . . . 040 240 340 440
American High-Income Trust/SM/ . . . . . . . . . . 021 221 321 421
The Bond Fund of America/SM/ . . . . . . . . . . . 008 208 308 408
Capital World Bond Fund/(R)/ . . . . . . . . . . . 031 231 331 431
Intermediate Bond Fund of America/SM/ . . . . . . . 023 223 323 423
Limited Term Tax-Exempt Bond Fund of America/SM/ . 043 243 343 443
The Tax-Exempt Bond Fund of America/(R)/ . . . . . 019 219 319 419
The Tax-Exempt Fund of California/(R)/* . . . . . . 020 220 320 420
The Tax-Exempt Fund of Maryland/(R)/* . . . . . . . 024 224 324 424
The Tax-Exempt Fund of Virginia/(R)/* . . . . . . . 025 225 325 425
U.S. Government Securities Fund/SM/ . . . . . . . . 022 222 322 422
MONEY MARKET FUNDS
The Cash Management Trust of America/(R)/ . . . . . 009 209 309 409
The Tax-Exempt Money Fund of America/SM/ . . . . . 039 N/A N/A N/A
The U.S. Treasury Money Fund of America/SM/ . . . . 049 N/A N/A N/A
___________
*Available only in certain states.

Capital World Growth and Income Fund - Page 31

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[Download Table]

FUND NUMBERS
---------------------------------------------
CLASS CLASS CLASS CLASS CLASS
FUND 529-A 529-B 529-C 529-E 529-F
-------------------------------------------------------------------------------

STOCK AND STOCK/BOND FUNDS
AMCAP Fund/(R)/ . . . . . . . . 1002 1202 1302 1502 1402
American Balanced Fund/(R)/ . . 1011 1211 1311 1511 1411
American Mutual Fund/(R)/ . . . 1003 1203 1303 1503 1403
Capital Income Builder/(R)/ . . 1012 1212 1312 1512 1412
Capital World Growth and Income
Fund/SM/ . . . . . . . . . . . 1033 1233 1333 1533 1433
EuroPacific Growth Fund/(R)/ . 1016 1216 1316 1516 1416
Fundamental Investors/SM/ . . . 1010 1210 1310 1510 1410
The Growth Fund of America/(R)/ 1005 1205 1305 1505 1405
The Income Fund of America/(R)/ 1006 1206 1306 1506 1406
The Investment Company of
America/(R)/. . . . . . . . . . 1004 1204 1304 1504 1404
The New Economy Fund/(R)/ . . . 1014 1214 1314 1514 1414
New Perspective Fund/(R)/ . . . 1007 1207 1307 1507 1407
New World Fund/SM/ . . . . . . 1036 1236 1336 1536 1436
SMALLCAP World Fund/(R)/ . . . 1035 1235 1335 1535 1435
Washington Mutual Investors
Fund/SM/ . . . . . . . . . . . 1001 1201 1301 1501 1401
BOND FUNDS
American High-Income Trust/SM/ 1021 1221 1321 1521 1421
The Bond Fund of America/SM/ . 1008 1208 1308 1508 1408
Capital World Bond Fund/(R)/ . 1031 1231 1331 1531 1431
Intermediate Bond Fund of
America/SM/ . . . . . . . . . . 1023 1223 1323 1523 1423
U.S. Government Securities
Fund/SM/. . . . . . . . . . . . 1022 1222 1322 1522 1422
MONEY MARKET FUND
The Cash Management Trust of
America/(R)/. . . . . . . . . . 1009 1209 1309 1509 1409

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SALES CHARGES

CLASS A SALES CHARGES - The sales charges you pay when purchasing Class A shares
of stock, stock/bond and bond funds of the American Funds are set forth below.
American Funds money market funds are offered at net asset value. (See "Fund
Numbers" above for a listing of the funds.)

[Download Table]

DEALER
SALES CHARGE AS COMMISSION
PERCENTAGE OF THE: AS PERCENTAGE
------------------ OF THE
AMOUNT OF PURCHASE
AT THE OFFERING PRICE NET AMOUNT OFFERING OFFERING
-INVESTED- PRICE PRICE
------------------------------------------- -------- ----- -----

STOCK AND STOCK/BOND FUNDS
Less than $25,000 . . . . . . . . . 6.10% 5.75% 5.00%
$25,000 but less than $50,000 . . . 5.26 5.00 4.25
$50,000 but less than $100,000. . 4.71 4.50 3.75
BOND FUNDS
Less than $100,000 . . . . . . . . 3.90 3.75 3.00
STOCK, STOCK/BOND, AND BOND FUNDS
$100,000 but less than $250,000 . 3.63 3.50 2.75
$250,000 but less than $500,000 . 2.56 2.50 2.00
$500,000 but less than $750,000 . 2.04 2.00 1.60
$750,000 but less than $1 million 1.52 1.50 1.20
$1 million or more . . . . . . . . none none see below
--------------------------------------------------------------------------------

CLASS A PURCHASES NOT SUBJECT TO SALES CHARGES - Investments of $1 million or
more are sold with no initial sales charge. HOWEVER, A 1% CONTINGENT DEFERRED
SALES CHARGE (CDSC) MAY BE IMPOSED IF REDEMPTIONS ARE MADE WITHIN ONE YEAR OF
PURCHASE.

The following investments are not subject to any initial or contingent deferred
sales charge if American Funds Service Company is notified:

.investments in Class A shares made by endowments or foundations with
$50 million or more in assets;

.investments made by accounts that are part of certain qualified
fee-based programs and that purchased Class A shares before March 15,
2001; and

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.Individual Retirement Account rollovers involving retirement plan
assets invested in the American Funds (see "Individual Retirement
Account (IRA) Rollovers" below).

A dealer concession of up to 1% may be paid by the fund under its Class A plan
of distribution on investments made with no initial sales charge.

EMPLOYER-SPONSORED RETIREMENT PLANS

ON OR BEFORE MARCH 31, 2004:

An employer-sponsored retirement plan (including certain 403(b) plans) may
invest in Class A shares without any initial or contingent deferred sales
charge if the plan invests $1 million or more, or if American Funds Service
Company is notified that the plan has 100 or more eligible employees or has
$50 million or more in assets. Plans investing in this manner may continue
to purchase Class A shares without any initial or contingent deferred sales
charge after March 31, 2004.

403(b) plans may be treated as employer-sponsored plans for sales charge
purposes if: (i) the American Funds are principal investment options; (ii)
the employer facilitates the enrollment process by, for example, allowing
for onsite group enrollment meetings held during working hours; and (iii)
there is only one dealer firm assigned to the plans.

AFTER MARCH 31, 2004:

. Employer-sponsored retirement plans not yet invested in Class A shares
and wishing to invest without a sales charge will no longer be
eligible to purchase Class A shares. Such plans may invest only in
Class R shares, which are described in more detail in the fund's
retirement plan prospectus.

. Provided that the plan's recordkeeper can properly apply a sales
charge on the plan's investments, an employer-sponsored retirement
plan not yet invested in Class A shares and wishing to invest less
than $1 million may invest in Class A shares, but the purchase of
these shares will be subject to the applicable sales charge,
regardless of whether the plan has 100 or more eligible employees or
whether it has $50 million or more in assets. An employer-sponsored
retirement plan that purchases Class A shares with a sales charge will
be eligible to purchase additional Class A shares in accordance with
the sales charge table above. If the recordkeeper cannot properly
apply a sales charge on the plan's investments, then the plan may
invest only in Class R shares, which are described in more detail in
the fund's retirement plan prospectus.

. Employer-sponsored retirement plans not yet invested in Class A shares
will no longer be eligible to establish a statement of intention of $1
million or more. More information about statements of intention can be
found under "Sales Charge Reductions and Waivers."

A transfer from the Virginia Prepaid Education Program/SM/ or the Virginia
Education Savings Trust/SM/ to a CollegeAmerica account will be made with no
sales charge. No commission will be paid to the dealer on such a transfer.

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In addition, Class A shares of the American Funds stock, stock/bond and bond
funds may be sold at net asset value to:

(1) current or retired directors, trustees, officers and advisory board members
of, and certain lawyers who provide services to, the funds managed by Capital
Research and Management Company, current or retired employees of Washington
Management Corporation, current or retired employees and partners of The Capital
Group Companies, Inc. and its affiliated companies, certain family members and
employees of the above persons, and trusts or plans primarily for such persons;

(2) current registered representatives and assistants directly employed by such
representatives, retired registered representatives with respect to accounts
established while active, or full-time employees (and their spouses, parents,
and children) of dealers who have sales agreements with the Principal
Underwriter (or who clear transactions through such dealers) and plans for such
persons or the dealers;

(3) current registered investment advisers registered with the Principal
Underwriter and assistants directly employed by such registered investment
advisers, retired registered investment advisers with respect to accounts
established while active, or full-time employees of registered investment
advisers registered with the Principal Underwriter (and their spouses, parents
and children), and plans for such persons;

(4) companies exchanging securities with the fund through a merger, acquisition
or exchange offer;

(5) insurance company separate accounts;

(6) accounts managed by subsidiaries of The Capital Group Companies, Inc.;

(7) The Capital Group Companies, Inc., its affiliated companies and Washington
Management Corporation;

(8) an individual or entity with a substantial business relationship with The
Capital Group Companies, Inc. or its affiliates, as determined by a Vice
President or more senior officer of the Capital Research and Management Company
Fund Administration Unit; and

(9) wholesalers and full-time employees directly supporting wholesalers
involved in the distribution of insurance company separate accounts whose
underlying investments are managed by any affiliate of The Capital Group
Companies, Inc.

Shares are offered at net asset value to these persons and organizations due to
anticipated economies in sales effort and expense. Once an account is
established under this net asset value privilege, additional investments can be
made at net asset value for the life of the account.

CONTINGENT DEFERRED SALES CHARGE ON CLASS A AND C SHARES - Except as described
above, a CDSC of 1% applies to redemptions of Class A shares of the American
Funds, other than the money market funds, made within 12 months following the
purchase of Class A shares of $1 million or more made without an initial sales
charge. A CDSC of 1% also applies to redemptions of Class C shares of the
American Funds made within 12 months following the purchase of the Class C
shares. The charge is 1% of the lesser of the value of the shares redeemed
(exclusive of

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reinvested dividends and capital gain distributions) or the total cost of such
shares. Shares held the longest are assumed to be redeemed first for purposes of
calculating this CDSC. The CDSC may be waived in certain circumstances. See
"CDSC Waivers for Class A, B and C Shares" below.

CLASS B SALES CHARGES - Class B shares are sold without any initial sales
charge. However, a CDSC may be applied to shares you sell within six years of
purchase, as shown in the table below.

CONTINGENT DEFERRED SALES CHARGE ON CLASS B SHARES

[Download Table]

Year of redemption: 1 2 3 4 5 6 7+
Contingent deferred sales charge: 5% 4% 4% 3% 2% 1% 0%

There is no CDSC on appreciation in share value above the initial purchase price
or on shares acquired through reinvestment of dividends or capital gain
distributions. In addition, the CDSC may be waived in certain circumstances. See
"CDSC Waivers for Class A, B and C Shares" below. The CDSC is based on the
original purchase cost or the current market value of the shares being sold,
whichever is less. In processing redemptions of Class B shares, shares that are
not subject to any CDSC will be redeemed first followed by shares that you have
owned the longest during the six-year period.

CLASS 529-E AND CLASS F SALES CHARGE - Class 529-E and F shares are sold with no
initial or contingent deferred sales charge.

DEALER COMMISSIONS AND COMPENSATION - For Class A shares, commissions (up to 1%)
are paid to dealers who initiate and are responsible for purchases of $1 million
or more, for purchases by any employer-sponsored defined contribution-type plan
investing $1 million or more or with 100 or more eligible employees, IRA
rollover accounts of $1 million or more (as described in "Individual Retirement
Account (IRA) Rollovers" below), and for purchases made at net asset value by
certain retirement plans, endowments and foundations with assets of $50 million
or more. Commissions on investments in Class A shares are paid at the following
rates: 1.00% on amounts to $4 million, 0.50% on amounts over $4 million to $10
million, and 0.25% on amounts over $10 million. Commissions are based on
cumulative investments and are not annually reset.

For Class B shares, compensation equal to 4.00% of the amount invested is paid
by the Principal Underwriter to dealers who sell Class B shares.

For Class C shares, compensation equal to 1.00% of the amount invested is paid
by the Principal Underwriter to dealers who sell Class C shares.

CONVERSION OF CLASS B AND C SHARES - Class B shares automatically convert to
Class A shares in the month of the eight-year anniversary of the purchase date.
Class C shares automatically convert to Class F shares in the month of the
ten-year anniversary of the purchase date. Class 529-C shares will not convert
to Class 529-F shares. The conversion of shares is subject to the Internal
Revenue Service's continued position that the conversions are not subject to
federal income tax. If the Internal Revenue Service no longer takes this
position, the automatic conversion feature may be suspended. If that happened,
no further conversions of Class B or C

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shares would occur while such suspension remained in effect, and at your option,
Class B shares could be exchanged for Class A shares and Class C shares for
Class F shares on the basis of the relative net asset values of the two classes,
without the imposition of a sales charge or fee; however, such an exchange could
constitute a taxable event for you. Absent such an exchange, Class B and C
shares would continue to be subject to higher expenses for longer than eight
years and ten years, respectively.

SALES CHARGE REDUCTIONS AND WAIVERS

REDUCING YOUR CLASS A SALES CHARGE - You and your "immediate family" (your
spouse -- or equivalent if recognized under local law -- and your children under
age 21) may combine investments to reduce your costs. You must let your
investment dealer or American Funds Service Company (the "Transfer Agent") know
at the time you purchase shares if you qualify for a reduction in your sales
charge using one or any combination of the methods described below.

STATEMENT OF INTENTION - You may enter into a non-binding commitment to
purchase shares of the American Funds over a 13-month period and receive
the same sales charge as if all shares had been purchased at once. This
includes purchases made during the previous 90 days, but does not include
future appreciation of your investment or reinvested distributions. The
reduced sales charges and offering prices set forth in the Prospectus apply
to purchases of $25,000 or more for equity funds and $100,000 or more for
bond funds made within a 13-month period subject to a statement of
intention (the "Statement"). The Statement is not a binding obligation to
purchase the indicated amount. After March 31, 2004, employer-sponsored
retirement plans not yet invested in Class A shares will no longer be
eligible to establish a statement of intention of $1 million or more.

When a shareholder elects to use a Statement in order to qualify for a
reduced sales charge on purchases of the American Funds, shares equal to 5%
of the dollar amount specified in the Statement will be held in escrow in
the shareholder's account out of the initial purchase (or subsequent
purchases, if necessary) by the Transfer Agent. All dividends and any
capital gain distributions on shares held in escrow will be credited to the
shareholder's account in shares (or paid in cash, if requested). If the
intended investment is not completed within the specified 13-month period,
the purchaser will remit to the Principal Underwriter the difference
between the sales charge actually paid and the sales charge which would
have been paid if the total of such purchases had been made at a single
time. The dealer assigned to the account at the end of the period will
receive an appropriate commission adjustment. If the difference is not paid
by the close of the Statement period, the appropriate number of shares held
in escrow will be redeemed to pay such difference. If the proceeds from
this redemption are inadequate, the purchaser will be liable to the
Principal Underwriter for the balance still outstanding.

The Statement may be revised upward at any time during the 13-month period,
and such a revision will be treated as a new Statement, except that the
13-month period during which the purchase must be made will remain
unchanged. Accordingly, upon your request, the sales charge paid on
investments made 90 days prior to the Statement revision will be adjusted
to reflect the revised Statement.

Existing holdings eligible for rights of accumulation (see below),
including Class A shares held in a fee-based arrangement, other classes of
shares of the American Funds, holdings in Endowments (shares of which may
be owned only by tax-exempt organi-

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zations) and any individual investments in American Legacy variable annuity
contracts and variable life insurance policies (American Legacy, American
Legacy II and American Legacy III, American Legacy Life, American Legacy
Variable Life, and American Legacy Estate Builder) may be credited toward
satisfying the Statement.

During the Statement period, reinvested dividends and capital gain
distributions, investments in money market funds, and investments made
under a right of reinstatement will not be credited toward satisfying the
Statement. The Statement will be considered completed if the shareholder
dies within the 13-month Statement period. Commissions will not be adjusted
or paid on the difference between the Statement amount and the amount
actually invested before the shareholder's death.

When the trustees of certain retirement plans purchase shares by payroll
deduction, the sales charge for the investments made during the 13-month
period will be handled as follows: the total monthly investment will be
multiplied by 13 and then multiplied by 1.5. The current value of existing
American Funds investments (other than money market fund investments) and
any rollovers or transfers reasonably anticipated to be invested in
non-money market American Funds during the 13-month period are added to the
figure determined above. The sum is the Statement amount and applicable
breakpoint level. On the first investment and all other investments made
pursuant to the Statement, a sales charge will be assessed according to the
sales charge breakpoint thus determined. There will be no retroactive
adjustments in sales charges on investments made during the 13-month
period.

Shareholders purchasing shares at a reduced sales charge under a Statement
indicate their acceptance of these terms with their first purchase.

AGGREGATION - Sales charge discounts are available for certain aggregated
investments. Qualifying investments include those made by you and your
immediate family (your spouse -- or equivalent if recognized under local
law -- and your children under the age of 21), if all parties are
purchasing shares for their own accounts and/or:

.individual-type employee benefit plan(s), such as an IRA, 403(b) plan
(see exception below), or single-participant Keogh-type plan;

.business accounts solely controlled by you or your immediate family
(for example, you own the entire business);

.trust accounts established by you or your immediate family. However,
if the person(s) who established the trust is deceased, the trust
account may be aggregated with accounts of the person who is the
primary beneficiary of the trust;

.endowments or foundations established and controlled by you or your
immediate family; or

.CollegeAmerica accounts, which will be aggregated at the account owner
level (Class 529-E accounts may only be aggregated with an eligible
employer plan).

Individual purchases by a trustee(s) or other fiduciary(ies) may also be
aggregated if the investments are:

.for a single trust estate or fiduciary account, including employee
benefit plans other than the individual-type employee benefit plans
described above;

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.made for two or more employee benefit plans of a single employer or of
affiliated employers as defined in the 1940 Act, again excluding
individual-type employee benefit plans described above;

.for a diversified common trust fund or other diversified pooled
account not specifically formed for the purpose of accumulating fund
shares;

.for non-profit, charitable or educational organizations (or any
employer-sponsored retirement plan for such an endowment or
foundation) or any endowments or foundations established and
controlled by the organization; or

.for participant accounts of a 403(b) plan that is treated as an
employer-sponsored plan (see "Class A Purchases Not Subject to Sales
Charges" above), or made for two or more 403(b) plans that are treated
as employer-sponsored plans of a single employer or affiliated
employers as defined in the 1940 Act.

Purchases made for nominee or street name accounts (securities held in the
name of an investment dealer or another nominee such as a bank trust
department instead of the customer) may not be aggregated with those made
for other accounts and may not be aggregated with other nominee or street
name accounts unless otherwise qualified as described above.

CONCURRENT PURCHASES - You may combine purchases of all classes of shares
of two or more funds in the American Funds, as well as individual holdings
in Endowments, American Legacy variable annuity contracts and variable life
insurance policies. Shares of money market funds purchased through an
exchange, reinvestment or cross-reinvestment from a fund having a sales
charge also qualify. However, direct purchases of American Funds money
market funds are excluded.

RIGHTS OF ACCUMULATION - Subject to the limitations described in the
aggregation policy, you may take into account the current value of your
existing holdings in all share classes of the American Funds, as well as
your holdings in Endowments, to determine your sales charge on investments
in accounts eligible to be aggregated, or when making a gift to an
individual or charity. Alternatively, upon your request, you may take into
account the amount you invested less any withdrawals (however, for this
purpose, the amount invested does not include capital appreciation or
reinvested dividends and capital gains). When determining your sales
charge, you may also take into account the value of your individual
holdings, as of the end of the week prior to your investment, in various
American Legacy variable annuity contracts and variable life insurance
policies. Direct purchases of American Funds money market funds are
excluded.

CDSC WAIVERS FOR CLASS A, B AND C SHARES - Any CDSC on Class A, B and C shares
(and, if applicable, on the corresponding Class 529 shares) may be waived only
in the following cases:

(1) Permitted exchanges of shares as described in the prospectus, provided that
the shares acquired by such exchanges are not redeemed within: (i) one year of
the initial purchase in the case of Class A or 529-A shares, (ii) six years of
the initial purchase in the case of Class B or 529-B shares, or (iii) one year
of the initial purchase in the case of Class C or 529-C shares.

(2) Tax-free returns of excess contributions to IRAs.

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(3) Redemptions due to death or post-purchase disability of a shareholder (this
generally excludes accounts registered in the names of trusts and other
entities). In the case of joint tenant accounts, if one joint tenant dies, a
surviving joint tenant, at the time he or she notifies the Transfer Agent of the
other joint tenant's death and removes the decedent's name from the account, may
redeem shares from the account without incurring a CDSC. Redemptions made after
the Transfer Agent is notified of the death of a joint tenant will be subject to
a CDSC.

(4) For Class 529-A, 529-B and 529-C shareholders only, redemptions due to a
beneficiary's death, post-purchase disability or receipt of a scholarship (to
the extent of the scholarship award).

(5) The following types of transactions, if together they do not exceed 12% of
the value of an "account" (defined below) annually (the "12% limit"):

. Required minimum distributions taken from retirement accounts upon the
shareholder's attainment of age 70 1/2 (required minimum distributions
that continue to be taken by the beneficiary(ies) after the account
owner is deceased also qualify for a waiver).

. Redemptions through a systematic withdrawal plan ("SWP") (see
"Automatic Withdrawals" under "Shareholder Account Services and
Privileges", below). For each SWP payment, assets that are not subject
to a CDSC, such as appreciation on shares and shares acquired through
reinvestment of dividends and/or capital gain distributions, will be
redeemed first and will count toward the 12% limit. If there is an
insufficient amount of assets not subject to a CDSC to cover a
particular SWP payment, shares subject to the lowest CDSC will be
redeemed next until the 12% limit is reached. Any dividends and/or
capital gain distributions taken in cash by a shareholder who receives
payments through a SWP will also count toward the 12% limit. In the
case of a SWP, the 12% limit is calculated at the time a systematic
redemption is first made, and is recalculated at the time each
additional systematic redemption is made. Shareholders who establish a
SWP should be aware that the amount of a payment not subject to a CDSC
may vary over time depending on fluctuations in the value of their
accounts. This privilege may be revised or terminated at any time.

For purposes of this paragraph, "account" means:

.in the case of Class A shares, your investment in Class A shares of
all American Funds (investments representing direct purchases of
American Funds money market funds are excluded);

.in the case of Class B shares, your investment in Class B shares of
the particular fund from which you are making the redemption; and

.in the case of Class C shares, your investment in Class C shares of
the particular fund from which you are making the redemption.

CDSC waivers are allowed only in the cases listed above. For example, CDSC
waivers will not be allowed on redemptions of Class 529-B and 529-C shares due
to: termination of CollegeAmerica; a determination by the Internal Revenue
Service that CollegeAmerica does not qualify as a qualified tuition program
under the Code; proposal or enactment of law that eliminates or limits

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the tax-favored status of CollegeAmerica; or the Virginia College Savings Plan
eliminating the fund as an option for additional investment within
CollegeAmerica.

INDIVIDUAL RETIREMENT ACCOUNT (IRA) ROLLOVERS

Assets from a retirement plan (plan assets) may be invested in any class of
shares of the American Funds through an IRA rollover plan. All such rollover
investments will be subject to the terms and conditions for Class A, B, C and F
shares contained in the applicable fund's current prospectus and statement of
additional information.

An IRA rollover involving plan assets that offered an investment option managed
by any affiliate of The Capital Group Companies, Inc., including any of the
American Funds, may be invested in: (i) Class A shares at net asset value; (ii)
Class A shares subject to the applicable initial sales charge; (iii) Class B
shares; (iv) Class C shares; or (v) Class F shares. Plan assets invested in
Class A shares with a sales charge, or B, C or F shares are subject to the terms
and conditions contained in the fund's current prospectus and statement of
additional information. Advisers will be compensated according to the policies
associated with each share class as described in the fund's current prospectus
and statement of additional information.

Plan assets invested in Class A shares at net asset value will not be subject to
a contingent deferred sales charge and will immediately begin to accrue service
fees (i.e., shares do not have to age). Dealer commissions will be paid only on
IRA rollovers of $1 million or more according to the schedule applicable to
Class A share investments of $1 million or more (see "Dealer Commissions and
Compensation" above). No dealer commissions will be paid on rollovers to
American Funds money market funds.

IRA rollovers that do not indicate in which share class plan assets should be
invested and that do not have an adviser associated with the account will be
invested in Class F shares. Additional plan assets may be rolled into the
account holding F shares; however, subsequent contributions cannot be invested
in F shares.

PRICE OF SHARES

Shares are purchased at the offering price or sold at the net asset value price
next determined after the purchase or sell order is received and accepted by the
fund or the Transfer Agent; the offering or net asset value price is effective
for orders received prior to the time of determination of the net asset value
and, in the case of orders placed with dealers or their authorized designees,
accepted by the Principal Underwriter, the Transfer Agent, a dealer or any of
their designees. In the case of orders sent directly to the fund or the Transfer
Agent, an investment dealer MUST be indicated. The dealer is responsible for
promptly transmitting purchase and sell orders to the Principal Underwriter.

Orders received by the investment dealer or authorized designee, the Transfer
Agent, or the fund after the time of the determination of the net asset value
will be entered at the next calculated offering price. Note that investment
dealers or other intermediaries may have their own rules about share
transactions and may have earlier cut-off times than those of the fund. For more
information about how to purchase through your intermediary, contact your
intermediary directly.

Prices that appear in the newspaper do not always indicate prices at which you
will be purchasing and redeeming shares of the fund, since such prices generally
reflect the previous

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day's closing price whereas purchases and redemptions are made at the next
calculated price. The price you pay for shares, the offering price, is based on
the net asset value per share which is calculated once daily as of approximately
4:00 p.m. New York time, which is the normal close of trading on the New York
Stock Exchange, each day the Exchange is open. If, for example, the Exchange
closes at 1:00 p.m., the fund's share price would still be determined as of 4:00
p.m. New York time. The New York Stock Exchange is currently closed on weekends
and on the following holidays: New Year's Day, Martin Luther King, Jr. Day,
Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor Day,
Thanksgiving and Christmas Day. Each share class of the fund has a separately
calculated net asset value (and share price).

All portfolio securities of funds managed by Capital Research and Management
Company (other than money market funds) are valued, and the net asset values per
share for each share class are determined, as follows:

1. Equity securities, including depositary receipts, are valued at the
official closing price of, or the last reported sale price on, the exchange or
market on which such securities are traded, as of the close of business on the
day the securities are being valued or, lacking any sales, at the last available
bid price. Prices for each security are taken from the principal exchange or
market in which the security trades. Fixed-income securities are valued at
prices obtained from an independent pricing service, when such prices are
available; however, in circumstances where the investment adviser deems it
appropriate to do so, such securities will be valued at the mean quoted bid and
asked prices or at prices for securities of comparable maturity, quality and
type.

Securities with original maturities of one year or less having 60 days or less
to maturity are amortized to maturity based on their cost if acquired within 60
days of maturity, or if already held on the 60th day, based on the value
determined on the 61st day. Forward currency contracts are valued at the mean of
representative quoted bid and asked prices.

Assets or liabilities initially expressed in terms of non-U.S. currencies are
translated prior to the next determination of the net asset value of the fund's
shares into U.S. dollars at the prevailing market rates.

Securities and assets for which representative market quotations are not readily
available are valued at fair value as determined in good faith under policies
approved by the fund's Board. Subject to Board oversight, the fund's Board has
delegated the obligation to make fair valuation determinations to a Valuation
Committee established by the fund's investment adviser. The Board receives
regular reports describing fair-valued securities and the valuation methods
used.

The Valuation Committee has adopted guidelines and procedures (consistent with
SEC rules and guidance) to ensure that certain basic principles and factors are
considered when making all fair value determinations. As a general principle,
securities lacking readily available market quotations are valued in good faith
by the Valuation Committee based upon what the fund might reasonably expect to
receive upon their current sale. The Valuation Committee considers all
indications of value available to it in determining the "fair value" to be
assigned to a particular security, including, without limitation, the type and
cost of the security, contractual or legal restrictions on resale of the
security, relevant financial or business developments of the issuer, actively
traded similar or related securities, conversion or exchange rights on the
security, related corporate actions, significant events occurring after the
close of trading in the security and changes in overall market conditions. The
Valuation Committee employs additional fair value procedures to address issues
related to investing substantial portions of applicable fund

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portfolios outside the United States. Securities owned by these funds trade in
markets that open and close at different times, reflecting time zone
differences. If significant events occur after the close of a market (and before
these funds' net asset values are next determined) which affect the value of
portfolio securities, appropriate adjustments from closing market prices may be
made to reflect these events. Events of this type could include earthquakes and
other natural disasters or significant price changes in other markets (e.g.,
U.S. stock markets);

2. Each class of shares represents interests in the same portfolio of
investments and is otherwise identical in all respects to each other class,
except for differences relating to distribution, service and other charges and
expenses, certain voting rights, differences relating to eligible investors, the
designation of each class of shares, conversion features and exchange
privileges. Expenses attributable to the fund, but not to a particular class of
shares, are borne by each class on the basis of the relative aggregate net
assets of the classes. Expenses directly attributable to a class of shares are
borne by that class of shares. Liabilities, including accruals of taxes and
other expense items attributable to particular share classes, are deducted from
total assets attributable to the respective share classes; and

3. Net assets so obtained for each share class are then divided by the total
number of shares outstanding of that share class, and the result, rounded to the
nearer cent, is the net asset value per share for that share class.

Any purchase order may be rejected by the Principal Underwriter or by the fund.
The Principal Underwriter will not knowingly sell shares of the fund directly or
indirectly to any person or entity, where, after the sale, such person or entity
would own beneficially directly or indirectly more than 3% of the outstanding
shares of the fund without the consent of a majority of the fund's Board.

SELLING SHARES

Shares are sold at the net asset value next determined after your request is
received in good order by the Transfer Agent, dealer or any of their designees.
Sales of certain Class A, B and C shares may be subject to a CDSC. Generally,
Class F shares are only available to fee-based programs of investment firms that
have special agreements with the fund's distributor and certain registered
investment advisers.

You may sell (redeem) other classes of shares in your account in any of the
following ways:

THROUGH YOUR DEALER (certain charges may apply)

-- Shares held for you in your dealer's street name must be sold through
the dealer.

WRITING TO AMERICAN FUNDS SERVICE COMPANY

-- Requests must be signed by the registered shareholder(s).

-- A signature guarantee is required if the redemption is:

- Over $75,000;

- Made payable to someone other than the registered shareholder(s);
or

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- Sent to an address other than the address of record, or an address
of record which has been changed within the last 10 days.

Your signature may be guaranteed by a domestic stock exchange or the
National Association of Securities Dealers, Inc., bank, savings
association or credit union that is an eligible guarantor institution.
The Transfer Agent reserves the right to require a signature guarantee
on any redemptions.

-- Additional documentation may be required for sales of shares held in
corporate, partnership or fiduciary accounts.

-- You must include with your written request any shares you wish to sell
that are in certificate form.

TELEPHONING OR FAXING AMERICAN FUNDS SERVICE COMPANY, OR USING THE INTERNET

-- Redemptions by telephone, fax or the Internet (including American
FundsLine/(R)/ and American FundsLine OnLine/(R)/) are limited to
$75,000 per shareholder each day.

-- Checks must be made payable to the registered shareholder(s).

-- Checks must be mailed to an address of record that has been used with
the account for at least 10 days.

MONEY MARKET FUNDS

-- You may have redemptions of $1,000 or more wired to your bank by
writing American Funds Service Company.

-- You may establish check writing privileges using an account
application.

- If you request check writing privileges, you will be provided
with checks that you may use to draw against your account. These
checks may be made payable to anyone you designate and must be
signed by the authorized number of registered shareholders
exactly as indicated on your checking account signature card.

- Check writing is not available for any of the 529 share classes
or B, C or F share classes of The Cash Management Trust of
America.

If you sell Class A, B or C shares and request a specific dollar amount to be
sold, we will sell sufficient shares so that the sale proceeds, after deducting
any applicable CDSC, equals the dollar amount requested.

Redemption proceeds will not be mailed until sufficient time has passed to
provide reasonable assurance that checks or drafts (including certified or
cashier's checks) for shares purchased have cleared (which may take up to 15
calendar days from the purchase date). Except for delays relating to clearance
of checks for share purchases or in extraordinary circumstances (and as
permissible under the 1940 Act), sale proceeds will be paid on or before the
seventh day

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following receipt and acceptance of an order. Interest will not accrue or be
paid on amounts that represent uncashed distribution or redemption checks.

If you notify the Transfer Agent, you may reinvest proceeds from a redemption,
dividend payment or capital gain distribution without a sales charge in any of
the American Funds within 90 days after the date of the redemption or
distribution. Proceeds from a Class B share redemption where a CDSC was charged
will be reinvested in Class A shares. Proceeds from any other type of redemption
and all dividend payments and capital gain distributions will be reinvested in
the same share class from which the original redemption or distribution was
made. Any CDSC on Class A or C shares will be credited to your account.
Redemption proceeds of Class A shares representing direct purchases in the money
market funds that are reinvested in non-money market funds will be subject to a
sales charge. Proceeds will be reinvested at the next calculated net asset value
after your request is received and accepted by the Transfer Agent.

SHAREHOLDER ACCOUNT SERVICES AND PRIVILEGES

The following services and privileges are generally available to all
shareholders. However, certain services and privileges may not be available for
Class 529 shareholders or if your account is held with an investment dealer.

AUTOMATIC INVESTMENT PLAN - An automatic investment plan enables you to make
monthly or quarterly investments in the American Funds through automatic debits
from your bank account. To set up a plan, you must fill out an account
application and specify the amount you would like to invest ($50 minimum) and
the date on which you would like your investments to occur. The plan will begin
within 30 days after your account application is received. Your bank account
will be debited on the day or a few days before your investment is made,
depending on the bank's capabilities. The Transfer Agent will then invest your
money into the fund you specified on or around the date you specified. If the
date you specified falls on a weekend or holiday, your money will be invested on
the following business day. However, if the following business day falls in the
next month, your money will be invested on the business day immediately
preceding the weekend or holiday. If your bank account cannot be debited due to
insufficient funds, a stop-payment or the closing of the account, the plan may
be terminated and the related investment reversed. You may change the amount of
the investment or discontinue the plan at any time by writing to the Transfer
Agent.

AUTOMATIC REINVESTMENT - Dividends and capital gain distributions are reinvested
in additional shares of the same class and fund at net asset value unless you
indicate otherwise on the account application. You also may elect to have
dividends and/or capital gain distributions paid in cash by informing the fund,
the Transfer Agent or your investment dealer. Dividends and capital gain
distributions paid by the 529 share classes will be automatically reinvested.

If you have elected to receive dividends and/or capital gain distributions in
cash, and the postal or other delivery service is unable to deliver checks to
your address of record, or you do not respond to mailings from American Funds
Service Company with regard to uncashed distribution checks, your distribution
option will automatically be converted to having all dividends and other
distributions reinvested in additional shares.

CROSS-REINVESTMENT OF DIVIDENDS AND DISTRIBUTIONS - For all share classes,
except the 529 classes of shares, you may cross-reinvest dividends and capital
gains ("distributions") of the

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same share class into other American Funds at net asset value, subject to the
following conditions:

(a) The aggregate value of your account(s) in the fund(s) paying distributions
equals or exceeds $5,000 (this is waived if the value of the account in the fund
receiving the distributions equals or exceeds that fund's minimum initial
investment requirement),

(b) If the value of the account of the fund receiving distributions is below
the minimum initial investment requirement, distributions must be automatically
reinvested,

(c) If you discontinue the cross-reinvestment of distributions, the value of
the account of the fund receiving distributions must equal or exceed the minimum
initial investment requirement. If you do not meet this requirement within 90
days of notification, the fund has the right to automatically redeem the
account.

EXCHANGE PRIVILEGE - You may only exchange shares into other American Funds
within the same class. However, exchanges from Class A shares of The Cash
Management Trust of America may be made to Class B or C shares of other American
Funds for dollar cost averaging purposes. Exchange purchases are subject to the
minimum investment requirements of the fund purchased and no sales charge
generally applies. However, exchanges of shares from the money market funds are
subject to applicable sales charges on the fund being purchased, unless the
money market fund shares were acquired by an exchange from a fund having a sales
charge, or by reinvestment or cross-reinvestment of dividends or capital gain
distributions. Exchanges of Class F shares generally may only be done through
fee-based programs of investment firms that have special agreements with the
fund's distributor and certain registered investment advisers.

Exchanges from Class A, C or F shares to the corresponding 529 share class,
particularly in the case of Uniform Gifts to Minors Act or Uniform Transfer to
Minors Act custodial accounts, may result in significant legal and tax
consequences as described in the CollegeAmerica Program Description. Please
consult your financial adviser prior to making such an exchange.

You may exchange shares of other classes by writing to the Transfer Agent (see
"Selling Shares" above), by contacting your investment dealer or financial
adviser, by using American FundsLine and American FundsLine OnLine (see
"American FundsLine and American FundsLine OnLine" below), or by telephoning
800/421-0180 toll-free, faxing (see "American Funds Service Company Service
Areas" in the prospectus for the appropriate fax numbers) or telegraphing the
Transfer Agent. For more information, see "Telephone and Internet Purchases,
Redemptions and Exchanges" below. Shares held in corporate-type retirement plans
for which Capital Bank and Trust Company serves as trustee may not be exchanged
by telephone, Internet, fax or telegraph. Exchange redemptions and purchases are
processed simultaneously at the share prices next determined after the exchange
order is received (see "Price of Shares" above). THESE TRANSACTIONS HAVE THE
SAME TAX CONSEQUENCES AS ORDINARY SALES AND PURCHASES.

AUTOMATIC EXCHANGES - For all share classes, you may automatically exchange
shares of the same class in amounts of $50 or more among any of the American
Funds on any day (or preceding business day if the day falls on a non-business
day) of each month you designate.

AUTOMATIC WITHDRAWALS - For all share classes, except the 529 classes of shares,
you may automatically withdraw shares from any of the American Funds. You can
make automatic withdrawals of $50 or more as often as you wish if your account
is worth at least $10,000, or up to

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four times a year for an account worth at least $5,000. You can designate the
day of each period for withdrawals and request that checks be sent to you or
someone else. Withdrawals may also be electronically deposited to your bank
account. The Transfer Agent will withdraw your money from the fund you specify
on or around the date you specify. If the date you specified falls on a weekend
or holiday, the redemption will take place on the previous business day.
However, if the previous business day falls in the preceding month, the
redemption will take place on the following business day after the weekend or
holiday.

Withdrawal payments are not to be considered as dividends, yield or income.
Automatic investments may not be made into a shareholder account from which
there are automatic withdrawals. Withdrawals of amounts exceeding reinvested
dividends and distributions and increases in share value would reduce the
aggregate value of the shareholder's account. The Transfer Agent arranges for
the redemption by the fund of sufficient shares, deposited by the shareholder
with the Transfer Agent, to provide the withdrawal payment specified.

ACCOUNT STATEMENTS - Your account is opened in accordance with your registration
instructions. Transactions in the account, such as additional investments, will
be reflected on regular confirmation statements from the Transfer Agent.
Dividend and capital gain reinvestments, purchases through automatic investment
plans and certain retirement plans, as well as automatic exchanges and
withdrawals will be confirmed at least quarterly.

AMERICAN FUNDSLINE AND AMERICAN FUNDSLINE ONLINE - You may check your share
balance, the price of your shares, or your most recent account transaction,
redeem shares (up to $75,000 per American Funds shareholder each day) from
non-retirement plan accounts, or exchange shares around the clock with American
FundsLine and American FundsLine OnLine. To use these services, call
800/325-3590 from a TouchTone(TM) telephone or access the American Funds website
on the Internet at americanfunds.com. Redemptions and exchanges through American
FundsLine and American FundsLine OnLine are subject to the conditions noted
above and in "Telephone and Internet Purchases, Redemptions and Exchanges"
below. You will need your fund number (see the list of the American Funds under
"Purchase of Shares - Fund Numbers"), personal identification number (generally
the last four digits of your Social Security number or other tax identification
number associated with your account) and account number.

TELEPHONE AND INTERNET PURCHASES, REDEMPTIONS AND EXCHANGES - By using the
telephone (including American FundsLine) or the Internet (including American
FundsLine OnLine), fax or telegraph purchase, redemption and/or exchange
options, you agree to hold the fund, the Transfer Agent, any of its affiliates
or mutual funds managed by such affiliates, and each of their respective
directors, trustees, officers, employees and agents harmless from any losses,
expenses, costs or liability (including attorney fees) which may be incurred in
connection with the exercise of these privileges. Generally, all shareholders
are automatically eligible to use these options. However, you may elect to opt
out of these options by writing the Transfer Agent (you may also reinstate them
at any time by writing the Transfer Agent). If the Transfer Agent does not
employ reasonable procedures to confirm that the instructions received from any
person with appropriate account information are genuine, it and/or the fund may
be liable for losses due to unauthorized or fraudulent instructions. In the
event that shareholders are unable to reach the fund by telephone because of
technical difficulties, market conditions, or a natural disaster, redemption and
exchange requests may be made in writing only.

REDEMPTION OF SHARES - The fund's Articles of Incorporation permit the fund to
direct the Transfer Agent to redeem the shares of any shareholder for their then
current net asset value per

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share if at such time the shareholder of record owns shares having an aggregate
net asset value of less than the minimum initial investment amount required of
new shareholders as set forth in the fund's current registration statement under
the 1940 Act, and subject to such further terms and conditions as the Board of
Directors of the fund may from time to time adopt.

While payment of redemptions normally will be in cash, the fund's Articles of
Incorporation permit payment of the redemption price wholly or partly in
securities or other property included in the assets belonging to the fund when
in the opinion of the fund's Board of Directors, which shall be conclusive,
conditions exist which make payment wholly in cash unwise or undesirable.

SHARE CERTIFICATES - Shares are credited to your account and certificates are
not issued unless you request them by writing to the Transfer Agent.
Certificates are not available for the 529 share classes.

EXECUTION OF PORTFOLIO TRANSACTIONS

The investment adviser places orders with broker-dealers for the fund's
portfolio transactions. The investment adviser strives to obtain best execution
on the fund's portfolio transactions, taking into account a variety of factors
to produce the most favorable total price reasonably attainable under the
circumstances. These factors include the size and type of transaction, the cost
and quality of executions, and the broker-dealer's ability to offer liquidity
and anonymity. The fund does not consider the investment adviser as having an
obligation to obtain the lowest available commission rate to the exclusion of
price, service and qualitative considerations. Subject to the considerations
outlined above, the investment adviser may place orders for the fund's portfolio
transactions with broker-dealers who have sold shares of funds managed by the
investment adviser, or who have provided investment research, statistical or
other related services to the investment adviser. In placing orders for the
fund's portfolio transactions, the investment adviser does not commit to any
specific amount of business with any particular broker-dealer. Further, when the
investment adviser places orders for the fund's portfolio transactions, it does
not give any consideration to whether a broker-dealer has sold shares of the
funds managed by the investment adviser. The investment adviser may, however,
give consideration to investment research, statistical or other related services
provided to the adviser in placing orders for the fund's portfolio transactions.

Portfolio transactions for the fund may be executed as part of concurrent
authorizations to purchase or sell the same security for other funds served by
the investment adviser, or for trusts or other accounts served by affiliated
companies of the investment adviser. When such concurrent authorizations occur,
the objective is to allocate the executions in an equitable manner.

Brokerage commissions paid on portfolio transactions, including investment
dealer concessions on underwritings, if applicable, for the fiscal years ended
2003, 2002 and 2001, amounted to $15,751,000, $16,408,000 and $18,877,000,
respectively.

The fund is required to disclose information regarding investments in the
securities of its "regular" investment dealers (or parent companies of its
regular investment dealers) that derive more than 15% of their revenue from
investment dealer, underwriter or investment adviser activities. A regular
investment dealer is: (1) one of the 10 investment dealers that received from
the fund the largest amount of brokerage commissions by participating, directly
or indirectly, in the fund's portfolio transactions during the fund's most
recent fiscal year; (2) one of the 10 investment dealers that engaged as
principal in the largest dollar amount of portfolio transactions of the fund
during the fund's most recent fiscal year; or (3) one of the 10 investment
dealers that sold the largest amount of securities of the fund during the fund's
most recent fiscal year. At the end of the

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fund's most recent fiscal year, the fund held equity securities of A.B.N. AMRO
Bank NV in the amount of $139,154,000, J.P. Morgan Chase & Co. in the amount of
$136,543,000, Bank of America Corp. in the amount of $90,516,000, Wachovia Corp.
in the amount of $33,123,000 and Deutsche Bank A.G. in the amount of
$32,759,000.

GENERAL INFORMATION

CUSTODIAN OF ASSETS - Securities and cash owned by the fund, including proceeds
from the sale of shares of the fund and of securities in the fund's portfolio,
are held by JPMorgan Chase Bank, 270 Park Avenue, New York, NY 10017-2070, as
Custodian. If the fund holds non-U.S. securities, the Custodian may hold these
securities pursuant to sub-custodial arrangements in non-U.S. banks or non-U.S.
branches of U.S. banks.

TRANSFER AGENT - American Funds Service Company, a wholly owned subsidiary of
the investment adviser, maintains the records of each shareholder's account,
processes purchases and redemptions of the fund's shares, acts as dividend and
capital gain distribution disbursing agent, and performs other related
shareholder service functions. The principal office of American Funds Service
Company is located at 135 South State College Boulevard, Brea, CA 92821-5823.
American Funds Service Company was paid a fee of $10,393,000 for Class A shares
and $359,000 for Class B shares for the 2003 fiscal year.

INDEPENDENT AUDITORS - PricewaterhouseCoopers LLP, 350 South Grand Avenue, Los
Angeles, CA 90071, serves as the fund's independent auditors, providing audit
services, preparation of tax returns and review of certain documents to be filed
with the Securities and Exchange Commission. The financial statements included
in this Statement of Additional Information from the Annual Report have been so
included in reliance on the report of PricewaterhouseCoopers LLP, independent
auditors, given on the authority of said firm as experts in accounting and
auditing. The selection of the fund's independent auditors is reviewed and
determined annually by the Board of Directors.

INDEPENDENT LEGAL COUNSEL - O'Melveny & Myers LLP, 400 South Hope Street, Los
Angeles, CA 90071, currently serves as counsel for the fund and for Directors
who are not interested persons (as defined by the 1940 Act) of the fund in their
capacities as such. Certain legal matters in connection with the capital shares
offered by the prospectus have been passed upon for the fund by O'Melveny &
Myers LLP. Counsel does not currently provide legal services to the fund's
investment adviser or any of its affiliated companies or control persons. A
determination with respect to the independence of the fund's "independent legal
counsel" will be made at least annually by the independent Directors of the
fund, as prescribed by the 1940 Act and the related rules.

PROSPECTUSES, REPORTS TO SHAREHOLDERS AND PROXY STATEMENTS - The fund's fiscal
year ends on November 30. Shareholders are provided updated prospectuses
annually and at least semiannually with reports showing the investment
portfolio, financial statements and other information. The fund's annual
financial statements are audited by the fund's independent auditors,
PricewaterhouseCoopers LLP. In addition, shareholders may also receive proxy
statements for the fund. In an effort to reduce the volume of mail shareholders
receive from the fund when a household owns more than one account, the Transfer
Agent has taken steps to eliminate duplicate mailings of prospectuses,
shareholder reports and proxy statements. To receive additional copies of a
prospectus, report or proxy statement, shareholders should contact the Transfer
Agent.

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CODES OF ETHICS - The fund and Capital Research and Management Company and its
affiliated companies, including the fund's principal underwriter, have adopted
codes of ethics which allow for personal investments, including securities in
which the fund may invest from time to time. These codes include: a ban on
acquisitions of securities pursuant to an initial public offering; restrictions
on acquisitions of private placement securities; pre-clearance and reporting
requirements; review of duplicate confirmation statements; annual
recertification of compliance with codes of ethics; blackout periods on personal
investing for certain investment personnel; ban on short-term trading profits
for investment personnel; limitations on service as a director of publicly
traded companies; and disclosure of personal securities transactions.

PROXY VOTING PROCEDURES AND GUIDELINES - The investment adviser has adopted
Proxy Voting Guidelines (the "Guidelines") with respect to voting proxies of
securities held by the American Funds, Endowments and American Funds Insurance
Series. Certain funds have established separate proxy committees that vote
proxies or delegate to a voting officer the authority to vote on behalf of those
funds. Proxies for all other funds are voted by an investment committee of the
investment adviser under authority delegated by the funds' Boards. Therefore, if
more than one fund invests in the same company, they may vote differently on the
same proposal.

All U.S. proxies are voted. Non-U.S. proxies also are voted, provided there is
sufficient time and information available. After a proxy is received, the
investment adviser prepares a summary of the proposals in the proxy. A
discussion of any potential conflicts of interest is also included in the
summary. After reviewing the summary, one or more research analysts familiar
with the company and industry make a voting recommendation on the proxy
proposals. A second recommendation is made by a proxy coordinator (a senior
investment professional) based on the individual's knowledge of the Guidelines
and familiarity with proxy-related issues. The proxy summary and voting
recommendations are then sent to the appropriate proxy voting committee for the
final voting decision.

The analyst and proxy coordinator making voting recommendations are responsible
for noting any potential material conflicts of interest. One example might be
where a director of one or more American Funds is also a director of a company
whose proxy is being voted. In such instances, proxy committee members are
alerted to the potential conflict. The proxy committee may then elect to vote
the proxy or seek a third-party recommendation or vote of an ad hoc group of
committee members.

The Guidelines, which have been in effect in substantially their current form
for many years, provide an important framework for analysis and decision-making
by all funds; however, they are not exhaustive and do not address all potential
issues. The Guidelines provide a certain amount of flexibility so that all
relevant facts and circumstances can be considered in connection with every
vote. As a result, each proxy received is voted on a case-by-case basis
considering the specific circumstances of each proposal. The voting process
reflects the funds' understanding of the company's business, its management and
its relationship with shareholders over time.

Beginning August 31, 2004 (and each August 31 thereafter) each fund will be
required to file Form N-PX containing its complete voting record for the 12
months ended the preceding June 30. Once filed, the most recent Form N-PX will
be available (i) without charge, upon request, by calling American Funds Service
Company at 800/421-0180, and (ii) on the SEC's website at www.sec.gov.

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The following summary sets forth the general positions of the American Funds,
Endowments, American Funds Insurance Series and the investment adviser on
various proposals. A copy of the full Guidelines is available upon request, free
of charge, by calling American Funds Service Company at 800/421-0180 or visiting
the American Funds website at americanfunds.com.

DIRECTOR MATTERS - The election of a company's slate of nominees for
director is generally supported. Votes may be withheld for some or all of
the nominees if this is determined to be in the best interest of
shareholders. Separation of the Chairman and CEO positions may also be
supported. Typically, proposals to declassify the board (elect all
directors annually) are supported based on the belief that this increases
the directors' sense of accountability to shareholders.

SHAREHOLDER RIGHTS - Proposals to repeal an existing poison pill, to
provide for confidential voting and to provide for cumulative voting are
usually supported. Proposals to eliminate the right of shareholders to act
by written consent or to take away a shareholder's right to call a special
meeting are not typically supported.

COMPENSATION AND BENEFIT PLANS - Option plans are complicated, and many
factors are considered in evaluating a plan. Each plan is evaluated based
on protecting shareholder interests and a knowledge of the company and its
management. Considerations include the pricing (or repricing) of options
awarded under the plan and the impact of dilution on existing shareholders
from past and future equity awards. Compensation packages should be
structured to attract, motivate and retain existing employees and qualified
directors; however, they should not be excessive.

ROUTINE MATTERS - The ratification of auditors, procedural matters relating
to the annual meeting, and changes to company name are examples of items
considered routine. Such items are generally voted in favor of management's
recommendations unless circumstances indicate otherwise.

OTHER INFORMATION - The financial statements including the investment portfolio
and the report of Independent Auditors contained in the Annual Report are
included in this Statement of Additional Information. The following information
is not included in the Annual Report:

DETERMINATION OF NET ASSET VALUE, REDEMPTION PRICE AND

MAXIMUM OFFERING PRICE PER SHARE FOR CLASS A SHARES - NOVEMBER 30, 2003

[Download Table]

Net asset value and redemption price per share
(Net assets divided by shares outstanding). . $28.62
Maximum offering price per share
(100/94.25 of net asset value per share,
which takes into account the fund's current maximum
sales charge). . . . . . . . . . . . . . . . $30.37

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APPENDIX

The following descriptions of debt security ratings are based on information
provided by Moody's Investors Service, Inc. ("Moody's") and Standard & Poor's
Corporation ("Standard & Poor's").

DESCRIPTION OF BOND RATINGS

MOODY'S
LONG-TERM RATING DEFINITIONS

AAA
Obligations rated Aaa are judged to be of the highest quality, with minimal
credit risk.

AA
Obligations rated Aa are judged to be of high quality and are subject to very
low credit risk.

A
Obligations rated A are considered upper-medium grade and are subject to low
credit risk.

BAA
Obligations rated Baa are subject to moderate credit risk. They are considered
medium-grade and as such may possess certain speculative characteristics.

BA
Obligations rated Ba are judged to have speculative elements and are subject to
substantial credit risk.

B
Obligations rated B are considered speculative and are subject to high credit
risk.

CAA
Obligations rated Caa are judged to be of poor standing and are subject to very
high credit risk.

CA
Obligations rated Ca are highly speculative and are likely in, or very near,
default, with some prospect of recovery of principal and interest.

C
Obligations rated C are the lowest rated class of bonds and are typically in
default, with little prospect for recovery of principal or interest.

NOTE: Moody's appends numerical modifiers 1, 2, and 3 to each generic rating
classification from Aa through Caa. The modifier 1 indicates that the obligation
ranks in the higher end of its generic rating category; the modifier 2 indicates
a mid-range ranking; and the modifier 3 indicates a ranking in the lower end of
that generic rating category.

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STANDARD & POOR'S

LONG-TERM ISSUE CREDIT RATINGS

AAA

An obligation rated AAA has the highest rating assigned by Standard & Poor's.
The obligor's capacity to meet its financial commitment on the obligation is
extremely strong.

An obligation rated AA differs from the highest-rated obligations only in small
degree. The obligor's capacity to meet its financial commitment on the
obligation is very strong.

An obligation rated A is somewhat more susceptible to the adverse effects of
changes in circumstances and economic conditions than obligations in
higher-rated categories. However, the obligor's capacity to meet its financial
commitment on the obligation is still strong.

BBB

An obligation rated BBB exhibits adequate protection parameters. However,
adverse economic conditions or changing circumstances are more likely to lead to
a weakened capacity of the obligor to meet its financial commitment on the
obligation.

BB, B, CCC, CC, AND C
Obligations rated BB, B, CCC, CC, and C are regarded as having significant
speculative characteristics. BB indicates the least degree of speculation and C
the highest. While such obligations will likely have some quality and protective
characteristics, these may be outweighed by large uncertainties or major
exposures to adverse conditions.

An obligation rated BB is less vulnerable to nonpayment than other speculative
issues. However, it faces major ongoing uncertainties or exposure to adverse
business, financial, or economic conditions which could lead to the obligor's
inadequate capacity to meet its financial commitment on the obligation.

An obligation rated B is more vulnerable to nonpayment than obligations rated
BB, but the obligor currently has the capacity to meet its financial commitment
on the obligation. Adverse business, financial, or economic conditions will
likely impair the obligor's capacity or willingness to meet its financial
commitment on the obligation.

CCC

An obligation rated CCC is currently vulnerable to nonpayment and is dependent
upon favorable business, financial, and economic conditions for the obligor to
meet its financial commitment on the obligation. In the event of adverse
business, financial, or economic conditions, the obligor is not likely to have
the capacity to meet its financial commitment on the obligation.

An obligation rated CC is currently highly vulnerable to nonpayment.

Capital World Growth and Income Fund - Page 53

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The C rating may be used to cover a situation where a bankruptcy petition has
been filed or similar action has been taken, but payments on this obligation are
being continued.

An obligation rated D is in payment default. The D rating category is used when
payments on an obligation are not made on the date due even if the applicable
grace period has not expired, unless Standard & Poor's believes that such
payments will be made during such grace period. The D rating also will be used
upon the filing of a bankruptcy petition or the taking of a similar action if
payments on an obligation are jeopardized.

PLUS (+) OR MINUS (-)
The ratings from AA to CCC may be modified by the addition of a plus or minus
sign to show relative standing within the major rating categories.

DESCRIPTION OF COMMERCIAL PAPER RATINGS

MOODY'S

COMMERCIAL PAPER RATINGS (HIGHEST THREE RATINGS)

P-1
Issuers (or supporting institutions) rated Prime-1 have a superior ability to
repay short-term debt obligations.

P-2
Issuers (or supporting institutions) rated Prime-2 have a strong ability to
repay short-term debt obligations.

P-3
Issuers (or supporting institutions) rated Prime-3 have an acceptable ability to
repay short-term obligations.

STANDARD & POOR'S

COMMERCIAL PAPER RATINGS (HIGHEST THREE RATINGS)

A-1
A short-term obligation rated A-1 is rated in the highest category by Standard &
Poor's. The obligor's capacity to meet its financial commitment on the
obligation is strong. Within this category, certain obligations are designated
with a plus sign (+). This indicates that the obligor's capacity to meet its
financial commitment on these obligations is extremely strong.

A-2
A short-term obligation rated A-2 is somewhat more susceptible to the adverse
effects of changes in circumstances and economic conditions than obligations in
higher rating categories. However, the obligor's capacity to meet its financial
commitment on the obligation is satisfactory.

A-3
A short-term obligation rated A-3 exhibits adequate protection parameters.
However, adverse economic conditions or changing circumstances are more likely
to lead to a weakened capacity of the obligor to meet its financial commitment
on the obligation.

Capital World Growth and Income Fund - Page 54

INVESTMENT PORTFOLIO November 30, 2003

[begin pie chart]
PERCENT
OF NET
INDUSTRY DIVERSIFICATION ASSETS

Diversified Telecommunication Services 7.12 %
Commercial Banks 7.02
Metals & Mining 6.03
Beverages & Tobacco 5.46
Pharmaceuticals 4.72
Bonds & notes 1.01
Other industries 55.40
Cash & equivalents 13.24

[end pie chart]

[Enlarge/Download Table]

Shares Market
EQUITY SECURITIES (COMMON AND PREFERRED STOCKS AND CONVERTIBLE or principal value
DEBENTURES) - 85.75% amount (000)
DIVERSIFIED TELECOMMUNICATION SERVICES - 7.12%
Portugal Telecom, SA (Portugal) 15,810,000 $ 148,732
Telekom Austria AG (Austria) (1) 8,740,000 101,388
SBC Communications Inc. (USA) 3,800,000 88,464
Telecom Italia SpA, nonvoting (Italy) (1) 45,870,596 87,679
TDC A/S (Denmark) 2,352,568 78,861
Swisscom AG (Switzerland) 259,389 77,997
Telefonica, SA (Spain) 5,973,120 77,308
Telefonos de Mexico, SA de CV, Class L (ADR) (Mexico) 1,996,600 66,067
Telefonos de Mexico, SA de CV 4.25% convertible debentures 2004 $ 9,220,000 10,626
Perusahaan Perseroan (Persero) PT Telekomunikasi Indonesia Tbk,
Class B (Indonesia) 96,837,500 70,065
BCE Inc. (Canada) 2,907,166 64,726
Verizon Communications Inc. (USA) 1,750,000 57,347
Chunghwa Telecom Co., Ltd. (ADR) (Taiwan) 3,400,000 49,946
Royal KPN NV (Netherlands) (1) 6,088,400 47,718
BT Group PLC (United Kingdom) 14,000,000 41,863
Deutsche Telekom AG (Germany) (1) 994,500 16,507
Deutsche Telekom International Finance BV 6.50% convertible bonds 2006 Euro 12,000,000 16,257
France Telecom, SA (France) (1) 956,000 24,632
Telecom Corp. of New Zealand Ltd. (New Zealand) 6,187,900 20,561
KT Corp. (South Korea) 520,000 20,073
TELUS Corp., nonvoting (Canada) 764,945 13,686
Singapore Telecommunications Ltd. (Singapore) 6,171,000 6,410
NTL Inc. (USA) (1) 77,003 5,018
NTL Europe, Inc., Series A, 10.00% preferred 2023 (France) 129 1

COMMERCIAL BANKS - 7.02%
DEPFA BANK PLC (Ireland) 1,461,107 167,569
Societe Generale (France) 2,090,000 167,311
ABN AMRO Holding NV (Netherlands) 6,324,440 139,154
Bank of America Corp. (USA) 1,200,000 90,516
HSBC Holdings PLC (United Kingdom) 4,562,063 69,170
HSBC Holdings PLC (Hong Kong) 1,372,282 21,027
Toronto-Dominion Bank (Canada) 2,544,700 80,362
Royal Bank of Scotland Group PLC (United Kingdom) 2,205,000 61,590
SMFG Finance (Cayman) Ltd. 2.25% mandatorily exchangeable preferred 2005,
units (Japan) 3,750,000,000 60,659
DnB Holding ASA (Norway) 7,600,000 45,921
Wachovia Corp. (USA) 724,000 33,123
Bank of Nova Scotia (Canada) 600,000 29,655
Wells Fargo & Co. (USA) 500,000 28,665
Westpac Banking Corp. (Australia) 2,449,210 27,123
Royal Bank of Canada (Canada) 518,400 24,667
National Australia Bank Ltd. (Australia) 1,000,000 20,932
FleetBoston Financial Corp. (USA) 500,000 20,300
Svenska Handelsbanken Group, Class A (Sweden) 1,029,300 19,018
Bank of the Philippine Islands (Philippines) 20,568,480 15,907
Bank Austria Creditanstalt (Austria) (1) 350,000 15,897
Malayan Banking Bhd. (Malaysia) 5,235,300 13,777
HBOS PLC (United Kingdom) 1,070,000 13,443
Skandinaviska Enskilda Banken AB, Class A (Sweden) 800,000 10,437

METALS & MINING - 6.03%
Cia. Vale do Rio Doce, Class A, preferred nominative (Brazil) 3,938,800 152,953
Cia. Vale do Rio Doce, ordinary nominative (ADR) 747,000 32,711
Freeport-McMoRan Copper & Gold Inc., Class B (USA) 3,569,800 155,393
Barrick Gold Corp. (Canada) 6,090,000 136,355
Phelps Dodge Corp. (USA) (1) 1,500,000 95,520
Gold Fields Ltd. (South Africa) 6,500,000 89,937
Anglogold Ltd. (South Africa) 1,500,000 72,262
Impala Platinum Holdings Ltd. (South Africa) 702,389 66,263
Newcrest Mining Ltd. (Australia) 6,000,000 55,588
Yanzhou Coal Mining Co. Ltd., Class H (China) 50,800,000 41,209
POSCO (South Korea) 333,000 39,616
Xstrata PLC (United Kingdom) 3,000,000 30,668
Alumina Ltd. (Australia) 7,143,900 30,507
Arcelor SA 3.875% convertible preferred 2005 (Luxembourg) 410,000 10,245

BEVERAGES & TOBACCO - 5.46%
Altria Group, Inc. (USA) 5,766,500 299,858
Diageo PLC (United Kingdom) 10,800,000 134,754
Foster's Group Ltd. (Australia) 36,214,319 115,332
R.J. Reynolds Tobacco Holdings, Inc. (USA) 1,900,000 104,880
Orkla AS (Norway) 2,985,714 66,338
Imperial Tobacco Group PLC (United Kingdom) 3,291,413 60,327
Swedish Match AB (Sweden) 5,500,550 49,541
Gallaher Group PLC (United Kingdom) 3,601,373 36,723
Coca-Cola HBC SA (Greece) 712,182 15,585
Fomento Economico Mexicano, SA de CV (ADR) (Mexico) 353,700 12,160
SABMiller PLC (South Africa) 850,716 8,499
UST Inc. (USA) 200,000 7,198
Wolverhampton & Dudley Breweries, PLC (United Kingdom) 251,493 3,242

PHARMACEUTICALS - 4.72%
AstraZeneca PLC (Sweden) 4,467,000 205,600
AstraZeneca PLC (United Kingdom) 325,000 14,761
Novo Nordisk A/S, Class B (Denmark) 2,644,800 101,444
Forest Laboratories, Inc. (USA) (1) 1,650,840 90,202
Sepracor Inc. (USA) (1) 1,500,000 37,170
Sepracor Inc. 5.75% convertible notes 2006 $ 30,000,000 28,987
Sepracor Inc. 5.75% convertible notes 2006 (2) $ 10,000,000 9,662
Eli Lilly and Co. (USA) 1,050,000 71,988
Sanofi-Synthelabo (France) 944,000 63,918
Shionogi & Co., Ltd. (Japan) 3,841,000 63,526
Pfizer Inc (USA) 1,035,000 34,724
Bristol-Myers Squibb Co. (USA) 1,140,000 30,039
Elan Corp., PLC (ADR) (Ireland) (1) 3,055,500 16,683
Elan Finance Corp. Ltd. 0% convertible notes 2018 $ 12,000,000 7,305
Merck KGaA (Germany) 378,221 14,831

OIL & GAS - 4.64%
Shell Canada Ltd. (Canada) 3,418,100 145,639
Canadian Oil Sands Trust (Canada) (2) 2,175,000 69,609
Canadian Oil Sands Trust 1,779,366 56,947
"Shell" Transport and Trading Co., PLC (ADR) (United Kingdom) 1,325,000 51,211
"Shell" Transport and Trading Co., PLC 2,850,000 18,050
Royal Dutch Petroleum Co. (Netherlands) 580,000 26,051
Royal Dutch Petroleum Co. (New York registered) 460,000 20,654
Petro-Canada (Canada) 2,475,000 106,314
Norsk Hydro ASA (Norway) 1,461,100 83,676
Petroleo Brasileiro SA - Petrobras, ordinary nominative (ADR) (Brazil) 1,550,000 37,308
Petroleo Brasileiro SA - Petrobras, preferred nominative (ADR) 1,160,000 26,123
Husky Energy Inc. (Canada) 3,745,000 62,701
ENI SpA (Italy) 1,500,000 25,567
Unocal Corp. (USA) 540,000 17,161
Sunoco, Inc. (USA) 325,000 15,603
Sasol Ltd. (South Africa) 1,100,000 14,008

FOOD PRODUCTS - 3.79%
Koninklijke Numico NV, Class C (Netherlands) (1) 8,080,000 205,281
Unilever NV (New York registered) (Netherlands) 1,840,000 110,584
Unilever NV 1,025,000 61,479
Nissin Food Products Co., Ltd. (Japan) 5,520,000 131,321
Nestle SA (Switzerland) 390,000 90,708
Unilever PLC (United Kingdom) 2,100,000 18,251
Groupe Danone (France) 104,500 16,280

INSURANCE - 3.50%
PartnerRe Holdings Ltd. (polynational) 1,875,000 104,475
Mitsui Sumitomo Insurance Co., Ltd. (Japan) 12,064,000 90,012
Allstate Corp. (USA) 1,700,000 68,646
Chubb Corp. (USA) 1,027,000 67,217
XL Capital Ltd., Class A (USA) 655,000 49,256
Sompo Japan Insurance Inc. (Japan) 6,000,000 44,548
Berkshire Hathaway Inc., Class A (USA) (1) 444 37,185
AEGON NV (Netherlands) 1,832,000 24,436
Aioi Insurance Co. Ltd. (Japan) 5,561,000 18,841
Sun Life Financial Inc. (formerly Sun Life Financial Services of Canada Inc.)
(Canada) 726,480 17,698
NIPPONKOA Insurance Co., Ltd. (Japan) 3,725,000 17,689
QBE Insurance Group Ltd. (Australia) 2,370,136 17,481
Millea Holdings, Inc. (Japan) 1,546 16,660
Travelers Property Casualty Corp. 4.50% convertible subordinated notes 2032(USA) $ 500,000 11,905

ELECTRIC UTILITIES - 3.08%
Scottish Power PLC (United Kingdom) 24,740,000 153,066
Korea Electric Power Corp. (South Korea) 6,364,240 134,221
E.ON AG (Germany) 1,425,000 80,775
Southern Co. (USA) 1,200,000 35,124
Korea Deposit Insurance Corp. 2.25% convertible debentures 2005 (South Korea)(2) $ 17,700,000 21,904
Dominion Resources, Inc. 9.50% PIES convertible preferred 2004 (USA) 365,400 units 20,079
American Electric Power Co., Inc. (USA) 700,000 19,383
FPL Group, Inc. (USA) 300,000 19,065
Consolidated Edison, Inc. (USA) 362,000 14,589
Ameren Corp. (USA) 250,000 11,032
Xcel Energy Inc. (USA) 206,200 3,444
DTE Energy Co. (USA) 87,100 3,285

SPECIALTY RETAIL - 2.64%
Lowe's Companies, Inc. (USA) 1,550,000 90,365
Yamada Denki Co., Ltd. (Japan) 2,470,000 73,310
Dixons Group PLC (United Kingdom) 30,882,596 72,548
Limited Brands, Inc. (USA) 3,176,900 56,930
Gap, Inc. (USA) 1,100,000 23,650
Gap, Inc. 5.75% convertible notes 2009 (2) $ 15,000,000 21,994
Kingfisher PLC (United Kingdom) 9,270,288 43,994
Kesa Electricals PLC (United Kingdom) 9,105,010 38,391
CarMax, Inc. (USA) (1) 650,000 21,404

REAL ESTATE - 2.59%
Hang Lung Properties Ltd. (Hong Kong) 46,000,000 56,861
Hongkong Land Holdings Ltd. (Hong Kong) 35,858,900 56,298
Sun Hung Kai Properties Ltd. (Hong Kong) 6,757,500 54,382
Hysan Development Co. Ltd. (Hong Kong) 30,550,593 43,664
Hang Lung Group Ltd. (Hong Kong) 27,537,000 33,330
Nippon Building Fund, Inc. (Japan) 4,620 29,070
Developers Diversified Realty Corp. (USA) 900,000 28,359
Japan Real Estate Investment Corp. (Japan) 4,600 28,062
Plum Creek Timber Co., Inc. (USA) 1,027,500 27,362
Kerry Properties Ltd. (Hong Kong) 18,140,161 23,358
Kimco Realty Corp. (USA) 525,000 23,100
Unibail Holding (France) 232,700 20,636
SM Prime Holdings, Inc. (Philippines) 52,885,000 6,183
Security Capital Global Realty (Luxembourg) (1) (2) (3) 126,752 2,142
HKR International Ltd. (Hong Kong) (1) 4,824,800 1,538

AUTOMOBILES - 2.30%
Toyota Motor Corp. (Japan) 3,570,000 107,263
Fuji Heavy Industries Ltd. (Japan) 13,419,000 63,602
Ford Motor Co. Capital Trust II 6.50% cumulative convertible trust preferred
2032 (USA) 1,172,950 58,518
Suzuki Motor Corp. (Japan) 2,865,000 40,581
Honda Motor Co., Ltd. (Japan) 750,000 30,685
Bayerische Motoren Werke AG (Germany) 617,000 27,159
Hyundai Motor Co., nonvoting preferred, Series 2 (South Korea) 1,407,550 25,411
General Motors Corp. (USA) 375,000 16,042
Nissan Motor Co., Ltd. (Japan) 1,400,000 16,007

DIVERSIFIED FINANCIAL SERVICES - 2.25%
ING Groep NV (Netherlands) 7,822,468 167,521
Fortis (Belgium) 4,000,000 74,780
Investor AB, Class B (Sweden) 5,333,090 48,386
Wharf (Holdings) Ltd. (Hong Kong) 11,000,000 27,478
Swire Pacific Ltd., Class A (Hong Kong) 4,500,000 26,654
Brascan Corp., Class A (Canada) 743,000 22,060
Hong Kong Exchanges and Clearing Ltd. (Hong Kong) 4,624,000 9,467

CHEMICALS - 2.08%
Potash Corp. of Saskatchewan Inc. (Canada) 1,110,000 90,065
Lyondell Chemical Co. (USA) 3,400,000 50,456
Formosa Chemicals & Fibre Corp. (Taiwan) 31,750,000 48,416
Formosa Plastics Corp. (Taiwan) 31,750,000 47,020
Dow Chemical Co. (USA) 1,250,000 46,937
DSM NV (Netherlands) 834,828 38,468
Nan Ya Plastics Corp. (Taiwan) 20,000,000 26,393

ELECTRONIC EQUIPMENT & INSTRUMENTS - 2.08%
Samsung SDI Co., Ltd. (South Korea) 1,015,000 103,020
Solectron Corp. (USA) (1) 6,750,000 39,488
Solectron Corp. 7.25% ACES convertible preferred 2004 800,000 13,104
Solectron Corp. 0% LYON convertible notes 2020 $ 16,000,000 9,120
Flextronics International Ltd. (Singapore) (1) 3,000,000 48,090
Hoya Corp. (Japan) 430,000 37,699
Electrocomponents PLC (United Kingdom) 5,000,000 29,472
Agilent Technologies, Inc. (USA) (1) 950,000 26,866
Orbotech Ltd. (Israel) (1) 1,035,500 24,386
Murata Manufacturing Co., Ltd. (Japan) 274,000 15,489
Kyoden Co., Ltd. (Japan) 200,000 970

WIRELESS TELECOMMUNICATION SERVICES - 2.03%
Vodafone Group PLC (United Kingdom) 64,804,642 148,891
AT&T Wireless Services, Inc. (USA) (1) 10,750,000 80,625
Sprint Corp. 7.125% convertible preferred 2004 (USA) 3,800,000 units 22,990
Advanced Info Service PCL (Thailand) 13,263,300 21,607
China Unicom Ltd. (China) 20,409,600 19,841
KDDI Corp. (Japan) 3,000 15,644
America Movil SA de CV, Series L (ADR) (Mexico) 600,000 15,384
Dobson Communications Corp., Class A (USA) (1) (2) 1,287,280 7,595
Crown Castle International Corp. 6.25% convertible preferred 2012 (USA) (1) 158,800 6,670
Crown Castle International Corp. (1) 10,919 136

THRIFTS & MORTGAGE FINANCE - 1.75%
Housing Development Finance Corp. Ltd. (India) 10,667,500 129,296
Housing Development Finance Corp. Ltd. (2) 940,000 11,393
Washington Mutual, Inc. (USA) 2,000,000 91,620
Freddie Mac (USA) 600,000 32,652
Fannie Mae (USA) 400,000 28,000

PAPER & FOREST PRODUCTS - 1.69%
Norske Skogindustrier ASA, Class A (Norway) 3,075,000 59,077
Georgia-Pacific Corp., Georgia-Pacific Group (USA) 1,998,300 54,534
UPM-Kymmene Corp. (Finland) 2,784,000 51,480
Stora Enso Oyj (ADR) (Finland) 1,086,300 14,470
Stora Enso Oyj, Class R 1,000,000 13,458
International Paper Co. (USA) 600,000 22,326
Holmen AB, Class B (Sweden) 620,000 21,515
M-real Oyj, Class B (Finland) 2,369,500 21,467
Sappi Ltd. (South Africa) 1,239,000 15,965
Aracruz Celulose SA, Class B, preferred nominative (ADR) (Brazil) 308,000 8,285

CAPITAL MARKETS - 1.59%
J.P. Morgan Chase & Co. (USA) 3,861,500 136,543
Allied Capital Corp. (USA) 3,548,000 96,789
Deutsche Bank AG (Germany) 470,000 32,759

SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT - 1.58%
Agere Systems Inc. 6.50% convertible notes 2009 (USA) $ 34,000,000 50,575
Agere Systems Inc., Class A (1) 6,465,156 22,887
ASML Holding NV (New York registered)(Netherlands) (1) 2,000,000 37,640
ASML Holding NV 5.50% convertible notes 2010 Euro 17,450,000 29,904
Samsung Electronics Co., Ltd. (South Korea) 95,000 36,751
Taiwan Semiconductor Manufacturing Co. Ltd. (Taiwan) (1) 19,368,720 36,068
KLA-Tencor Corp. (USA) (1) 300,000 17,583
Texas Instruments Inc. (USA) 558,500 16,621
Linear Technology Corp. (USA) 375,000 16,178

MEDIA - 1.55%
Time Warner Inc. (formerly AOL Time Warner) (USA) (1) 7,360,000 119,821
John Fairfax Holdings Ltd. (Australia) 14,420,104 36,322
Mediaset SpA (Italy) 2,500,000 28,342
News Corp. Ltd., preferred (Australia) 3,580,739 25,244
Viacom Inc., Class B, nonvoting (USA) 500,000 19,660
EMI Group PLC (United Kingdom) 3,550,000 10,371
Comcast Corp., Class A (USA) (1) 323,500 10,151
SCMP Group Ltd. (Hong Kong) 19,760,671 9,033
Antena 3 Television, SA (Spain) (1) 10,053 423
UnitedGlobalCom, Inc., Class A (USA) (1) (2) (3) 20,092 131

HEALTH CARE PROVIDERS & SERVICES - 1.27%
Fresenius Medical Care AG (Germany) 970,000 61,575
Fresenius Medical Care AG, preferred 1,300,000 59,824
CIGNA Corp. (USA) 900,000 48,285
HCA Inc. (USA) 1,030,000 43,167

HOTELS, RESTAURANTS & LEISURE - 1.22%
Rank Group PLC (United Kingdom) 13,700,000 68,375
InterContinental Hotels Group PLC (United Kingdom) 4,823,267 44,596
Harrah's Entertainment, Inc. (USA) 750,000 35,903
J D Wetherspoon PLC (United Kingdom) 6,159,424 28,615
Carnival Corp., units (USA) 700,000 24,633
Greene King PLC (United Kingdom) 104,799 1,509

MULTI-UTILITIES & UNREGULATED POWER - 1.17%
National Grid Transco PLC (United Kingdom) 13,745,000 92,965
National Grid Transco PLC (ADR) 439,725 15,030
Williams Companies, Inc. 9.00% FELINE PACS convertible preferred 2005 (USA) 2,480,000 units 31,521
Williams Companies, Inc. 1,337,300 12,544
Duke Energy Corp. (USA) 986,700 17,800
Equitable Resources, Inc. (USA) 375,000 15,450
United Utilities PLC (United Kingdom) 1,000,000 8,510
United Utilities PLC, Class A (1) 555,555 2,861

INDUSTRIAL CONGLOMERATES - 1.17%
Tyco International Ltd. (USA) 5,500,000 126,225
General Electric Co. (USA) 1,900,000 54,473
Wesfarmers Ltd. (Australia) 770,000 15,717

COMPUTERS & PERIPHERALS - 1.17%
Sun Microsystems, Inc. (USA) (1) 20,500,000 87,535
International Business Machines Corp. (USA) 590,000 53,419
Hewlett-Packard Co. (USA) 1,812,500 39,313
Quanta Computer Inc. (Taiwan) 4,212,461 9,944
Dell Inc. (formerly Dell Computer Corp.) (USA) (1) 150,000 5,175

GAS UTILITIES - 0.97%
Gas Natural SDG, SA (Spain) 5,219,500 107,524
Enbridge Inc. (Canada) 907,283 36,384
NiSource Inc. (USA) 900,000 18,675

FOOD & STAPLES RETAILING - 0.94%
Koninklijke Ahold NV (Netherlands) (1) 7,567,700 54,596
Koninklijke Ahold NV, rights, expire 2003 (1) 7,567,700 7,074
Woolworths Ltd. (Australia) 5,590,676 45,888
Loblaw Companies Ltd. (Canada) 630,000 29,953
Albertson's, Inc. (USA) 600,000 12,768
Coles Myer Ltd. (Australia) 1,258,300 6,776

OFFICE ELECTRONICS - 0.69%
Xerox Corp. (USA) (1) 6,500,000 79,170
Xerox Capital Trust II 7.50% convertible preferred 2021 (2) 500,000 35,875

HOUSEHOLD DURABLES - 0.56%
Daito Trust Construction Co., Ltd. (Japan) 2,813,900 79,406
Sony Corp. (Japan) 435,400 15,110

AEROSPACE & DEFENSE - 0.54%
Singapore Technologies Engineering Ltd. (Singapore) 45,200,000 51,671
Raytheon Co. - RC Trust I 8.25% convertible preferred 2006 (USA) 380,000 units 19,494
BAE SYSTEMS PLC (United Kingdom) 6,471,800 19,408

OTHER - 3.77%
Schneider SA (France) 1,023,000 63,015
Kimberly-Clark de Mexico, SA de CV, Class A, ordinary participation
certificates (Mexico) 23,396,100 58,172
QUALCOMM Inc. (USA) 1,225,000 54,574
Target Corp. (USA) 1,247,500 48,303
Infosys Technologies Ltd. (India) 371,378 40,013
Deutsche Lufthansa AG (Germany) 2,500,000 38,199
Capital One Financial Corp. 6.25% Upper DECS 2005 (USA) 600,000 units 27,822
Sonoco Products Co. (USA) 1,200,000 25,680
Li & Fung Ltd. (Hong Kong) 13,000,000 22,263
Brambles Industries Ltd. (Australia) 6,600,000 21,831
IHC Caland NV (Netherlands) 418,259 19,548
Uni-Charm Corp. (Japan) 398,000 19,009
Asahi Diamond Industrial Co., Ltd. (Japan) (4) 3,950,000 18,722
Motorola, Inc. 7.00% convertible preferred 2004 (USA) 400,000 units 17,244
Smurfit-Stone Container Corp. (USA) (1) 974,200 15,938
TPG NV (Netherlands) 716,400 15,454
Microsoft Corp. (USA) 600,000 15,420
Vedior NV (Netherlands) 985,700 14,919
Qantas Airways Ltd. (Australia) 6,021,000 14,512
Volvo AB, Class B (Sweden) 497,450 14,396
Schlumberger Ltd. (USA) 300,000 14,076
Singapore Post Private Ltd. (Singapore) 32,160,000 12,877
Brambles Industries PLC (United Kingdom) 4,000,000 12,013
Fluor Corp. (USA) 257,900 9,455
Corning Inc. 3.50% convertible debentures 2008 (USA) $ 7,000,000 9,205
Zhejiang Expressway Co. Ltd., Class H (China) 9,039,300 5,558
Juniper Networks, Inc. 4.75% convertible subordinated notes 2007 (USA) $ 2,593,000 2,697
TI Automotive Ltd., Class A (United Kingdom) (1) (3) 1,068,000 0

MISCELLANEOUS - 2.79%
Other equity securities in initial period of acquisition 467,868

TOTAL EQUITY SECURITIES (cost: $11,337,489,000) 14,357,441

Principal Market
amount value
BONDS & notes - 1.01% (000) (000

WIRELESS TELECOMMUNICATION SERVICES - 0.28%
AT&T Wireless Services, Inc. 8.125% 2012 $ 40,750 $ 46,598

ELECTRONIC EQUIPMENT & INSTRUMENTS - 0.16%
Solectron Corp. 9.625% 2009 15,000 16,650
Flextronics International Ltd. 6.50% 2013 10,000 10,050

FOOD & STAPLES RETAILING - 0.14%
Ahold Finance U.S.A., Inc. 8.25% 2010 12,990 14,224
Ahold Finance U.S.A., Inc. 6.25% 2009 9,065 9,156

DIVERSIFIED TELECOMMUNICATION SERVICES - 0.11%
TeleWest PLC 11.00% 2007 (5) 31,493 18,502

MULTI-UTILITIES & UNREGULATED POWER - 0.10%
El Paso Corp. 7.875% 2012 14,500 12,833
Southern Natural Gas Co. 8.00% 2032 3,615 3,669
Northwest Pipeline Corporation 8.125% 2010 500 556

AIRLINES - 0.07%
British Airways PLC 8.75% 2016 (6) Pound 7,000 12,167

HEALTH CARE PROVIDERS & SERVICES - 0.06%
HCA - The Healthcare Co. 8.75% 2010 $ 9,000 10,458

OIL & GAS - 0.05%
Premcor Refining Group Inc. 7.50% 2015 8,000 8,240

ELECTRICAL EQUIPMENT - 0.04%
Elektrim Finance BV 2.00% 2005 (3) (7) Euro 6,230 6,346

PAPER & FOREST PRODUCTS - 0.00%
APP International Finance Co. BV 11.75% 2005 (5) $ 1,150 489

TOTAL BONDS & NOTES (cost: $154,866,000) 169,938

Principal Market
amount value
SHORT-TERM SECURITIES - 12.83% (000) (000

CORPORATE SHORT-TERM NOTES - 12.53%
BNP Paribas Finance Inc. 1.04%-1.07% due 12/15/2003-1/23/2004 $ 100,000 $ 99,906
Bank of Ireland 1.04%-1.09% due 12/22/2003-2/13/2004 (2) 100,000 99,871
Dexia Delaware LLC 1.04%-1.075% due 12/5/2003-2/23/2004 100,000 99,865
KfW International Finance Inc. 1.03%-1.07% due 12/9/2003-2/24/2004 (2) 100,000 99,854
Danske Corp. 1.05%-1.07% due 12/19/2003-2/24/2004 100,000 99,831
Credit Lyonnais N.A. Inc. 1.04%-1.09% due 12/5/2003-2/23/2004 100,000 99,819
Toronto-Dominion Holdings USA Inc. 1.05%-1.08% due 12/18/2003-2/12/2004 100,000 99,799
Westpac Trust Securities NZ Ltd. 1.06%-1.09% due 12/2/2003-2/13/2004 100,000 99,796
UBS Finance (Delaware) LLC 1.02%-1.08% due 12/1/2003-2/17/2004 93,200 93,085
Stadshypotek Delaware Inc. 1.05% due 12/1-12/3/2003 (2) 33,400 33,398
Svenska Handelsbanken Inc. 1.08% due 1/26-2/6/2004 50,000 49,904
Alcon Capital Corp 1.04%-1.07% due 12/4/2003-2/19/2004 (2) 80,000 79,867
TotalFinaElf Capital SA 1.02%-1.04% due 12/8-12/17/2003 (2) 75,000 74,969
Shell Finance (U.K.) PLC 1.03%-1.07% due 12/10/2003-2/5/2004 50,000 49,941
Shell Finance (U.K.) PLC 1.08% due 3/11/2004 (2) 25,000 24,921
Societe Generale North America Inc. 1.04%-1.05% due 12/10/2003-1/13/2004 65,000 64,942
Bank of Nova Scotia 1.06%-1.09% due 1/26-2/11/2004 65,000 64,869
Rio Tinto PLC 1.02%-1.08% due 12/2/2003-1/14/2004 (2) 60,000 59,966
ANZ (Delaware) Inc. 1.04% due 12/8-12/9/2003 50,000 49,987
Rabobank Nederland NV 1.02%-1.05% due 12/3-12/16/2003 50,000 49,983
BMW U.S. Capital Corp. 1.02% due 12/16-12/18/2003 50,000 49,976
Barclays U.S. Funding Corp. 1.05%-1.055% due 12/2/2003-1/13/2004 50,000 49,956
Aventis S.A. 1.03%-1.07% due 12/4/2003-1/22/2004 (2) 50,000 49,950
Spintab AB (Swedmortgage) 1.05%-1.085% due 12/11/2003-1/22/2004 50,000 49,946
American Honda Finance Corp. 1.02%-1.07% due 12/22/2003-1/27/2004 50,000 49,944
Edison Asset Securitization LLC 1.07%-1.09% due 1/7-1/23/2004 (2) 50,000 49,935
Royal Bank of Scotland PLC 1.08% due 1/16/2004 50,000 49,928
ABN AMRO North America Finance Inc. 1.06%-1.08% due 1/14-2/3/2004 50,001 49,907
ING (U.S.) Funding LLC 1.08%-1.09% due 1/21-2/10/2004 50,000 49,905
Allied Irish Banks N.A. Inc. 1.05%-1.055% due 12/19/2003 37,500 37,479
Royal Bank of Canada 1.05% due 12/5-12/19/2003 25,000 24,992
HSBC USA Inc. 1.07% due 1/13/2004 25,000 24,966
Sony Capital Corp. 1.05%-1.06% due 12/17/2003 (2) 20,000 19,990
Siemens Capital Corp. 1.05% due 1/5/2004 16,500 16,482
Electricite de France 1.04% due 12/3/2003 15,000 14,999
Telstra Corp. Ltd. 1.06% due 12/31/2003 15,000 14,986

CERTIFICATES OF DEPOSIT - 0.30%
HBOS Treasury Services PLC 1.09%-1.12% due 1/28/2004 50,000 49,999

TOTAL SHORT-TERM SECURITIES (cost: $2,147,982,000) 2,147,913

TOTAL INVESTMENT SECURITIES (cost: $13,640,337,000) 16,675,292

New Taiwanese Dollar (cost: $5,526,000) NT$182,768 5,360
Other assets less liabilities 63,113

NET ASSETS $16,743,765

(1) Security did not produce income during the last 12 months.
(2) Purchased in a private placement transaction; resale may be
limited to qualified institutional buyers; resale to the public
may require registration.
(3) Valued under fair value procedures adopted by authority of the Board
of Directors.
(4) The fund owns 5.46% of the outstanding voting securities of Asahi Diamond
Industrial Co., Ltd., and thus is considered an affiliate of this company
under the Investment Company Act of 1940.
(5) Company not making scheduled interest payments;
bankruptcy proceedings pending.
(6) Coupon rate may change periodically.
(7) Pass-through security backed by a pool of
mortgages or other loans on which principal payments are
periodically made. Therefore, the effective maturity
is shorter than the stated maturity.

ADR = American Depositary Receipts

See Notes to Financial Statements

EQUITY SECURITIES APPEARING IN THE PORTFOLIO SINCE MAY 31, 2003:

Advanced Info Service
Agilent
Antena 3 Television
Aracruz Celulos
Bank Austria
Brascan
BT Group
Chunghwa Telecom
CIGNA
Coles Myer
Consolidated Edison
Daito Trust Construction
DEPFA BANK
Deutsche Bank
Diageo
DnB Holding
Dobson Communications
DTE Energy
EMI Group
Equitable Resources
Fannie Mae
Formosa Chemicals & Fibre
Formosa Plastics
Fortis
FPL Group
Harrah's Entertainment
InterContinental Hotels Group
John Fairfax Holdings
Koninklijke Ahold
Korea Electric Power
KT
Malayan Banking
Merck KGaA
Nan Ya Plastics
Potash Corp. of Saskatchewan
Quanta Computer
Rank Group
Royal Bank of Scotland Group
SABMiller
Singapore Post
Singapore Technologies Engineering
Svenska Handelsbanken
TDC
Toyota Motor
TPG
Uni-Charm
Vedior
Verizon Communications
Wells Fargo
Wesfarmers
Xcel Energy
Yamada Denki

EQUITY SECURITIES ELIMINATED FROM THE PORTFOLIO SINCE MAY 31, 2003:

ABB
Allied Irish Banks
AT&T
Australian Gas Light
BOC Group
British Airways
Chubb PLC
EULER & HERMES
Gencor
Great Eagle Holdings
Greek Organization of Football Prognostics
H.J. Heinz
Hang Seng Bank
Hays
Invensys
James Hardie Industries
KirchPayTV GmbH
Lloyds TSB Group
Mercury General
Munchener Ruckversicherungs-Gesellschaft
Nextel Communications
NICOR
Panafon
Pinnacle West Capital
Promina Group
Robert Half International
Siemens
Village Roadshow

FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES (dollars and shares in thousands,
at November 30, 2003 except per-share amounts)

[Download Table]

ASSETS:
Investment securities at market:
Unaffiliated issuers (cost: $13,619,242) $16,656,570
Affiliated issuers (cost: $21,095) 18,722 16,675,292
Cash denominated in non-U.S. currencies 5,360
(cost: $5,526)
Cash 35
Receivables for:
Sales of investments 12,751
Sales of fund's shares 107,372
Dividends and interest 36,042
Other 135 156,300
16,836,987
LIABILITIES:
Payables for:
Purchases of investments 65,042
Repurchases of fund's shares 6,451
Investment advisory services 5,413
Services provided by affiliates 8,725
Deferred Directors' compensation 548
Other fees and expenses 7,043 93,222
NET ASSETS AT NOVEMBER 30, 2003 $16,743,765

NET ASSETS CONSIST OF:
Capital paid in on shares of capital stock $13,470,415
Undistributed net investment income 72,260
Undistributed net realized gain 172,399
Net unrealized appreciation 3,028,691
NET ASSETS AT NOVEMBER 30, 2003 $16,743,765

TOTAL AUTHORIZED CAPITAL STOCK - 1,000,000 SHARES, $.01 PAR VALUE

[Download Table]

Net assets Shares outstanding Net asset value per share(1)

Class A $14,703,266 513,742 $28.62
Class B 536,616 18,830 28.50
Class C 614,443 21,612 28.43
Class F 469,821 16,434 28.59
Class 529-A 92,452 3,234 28.59
Class 529-B 17,654 619 28.51
Class 529-C 29,227 1,025 28.50
Class 529-E 5,072 178 28.56
Class 529-F 1,493 52 28.59
Class R-1 4,968 174 28.50
Class R-2 57,338 2,015 28.45
Class R-3 76,426 2,679 28.53
Class R-4 24,667 863 28.60
Class R-5 110,322 3,853 28.63

(1) Maximum offering price and redemption price per share were equal
to the net asset value per share for all share classes, except for classes
A and 529-A, for which the maximum offering prices per share were $30.37
and $30.33, respectively.

See Notes to Financial Statements

STATEMENT OF OPERATIONS
for the year ended November 30, 2003 (dollars in thousands)

[Enlarge/Download Table]

INVESTMENT INCOME:
Income:
Dividends (net of non-U.S. withholding
tax of $25,347; also includes
$354 from affiliates) $ 375,778
Interest (net of non-U.S. withholding
tax of $29) 52,206 $427,984

Fees and expenses:
Investment advisory services 50,748
Distribution services 35,706
Transfer agent services 10,752
Administrative services 1,694
Reports to shareholders 456
Registration statement and prospectus 552
Postage, stationery and supplies 1,284
Directors' compensation 347
Auditing and legal 102
Custodian 3,355
State and local taxes 156
Other 118
Total expenses before reimbursement 105,270
Reimbursement of expenses 186 105,084
Net investment income 322,900

NET REALIZED GAIN AND UNREALIZED
APPRECIATION ON INVESTMENTS
AND NON-U.S. CURRENCY:
Net realized gain (loss) on:
Investments 240,790
Non-U.S. currency transactions (3,803) 236,987
Net unrealized appreciation (depreciation) on:
Investments 2,773,471
Non-U.S. currency translations (5,129) 2,768,342
Net realized gain and
unrealized appreciation
on investments and non-U.S. currency 3,005,329
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS $3,328,229

STATEMENT OF CHANGES IN NET ASSETS (dollars in thousands)

Year ended
November 30
2003 2002
OPERATIONS:
Net investment income $322,900 $235,407
Net realized gain on investments and
non-U.S. currency transactions 236,987 280,535
Net unrealized appreciation (depreciation)
on investments and non-U.S. currency translations 2,768,342 (1,005,895)
Net increase (decrease) in net assets
resulting from operations 3,328,229 (489,953)

DIVIDENDS PAID TO SHAREHOLDERS FROM NET INVESTMENT INCOME (272,642) (214,996)

CAPITAL SHARE TRANSACTIONS 3,020,303 803,023

TOTAL INCREASE IN NET ASSETS 6,075,890 98,074

NET ASSETS:
Beginning of year 10,667,875 10,569,801
End of year (including
undistributed
net investment income: $72,260 and $21,501,
respectively) $16,743,765 $10,667,875

See Notes to Financial Statements

NOTES TO FINANCIAL STATEMENTS

1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES

ORGANIZATION - Capital World Growth and Income 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 capital growth while
providing current income.

The fund offers 14 share classes consisting of four retail share classes, five
CollegeAmerica savings plan share classes and five retirement plan share
classes. The CollegeAmerica savings plan share classes (529-A, 529-B, 529-C,
529-E and 529-F) are sponsored by the Commonwealth of Virginia and can be
utilized to save for college education. The five retirement plan share classes
(R-1, R-2, R-3, R-4 and R-5) are sold without any sales charges and do not carry
any conversion rights. The fund's share classes are described below:

[Enlarge/Download Table]

---------------------------------------------------------------------------------------------------------
Share class Initial sales charge Contingent deferred sales Conversion feature
charge upon redemption
---------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------
Classes A and 529-A Up to 5.75% None (except 1% for None
certain redemptions
within one year of
purchase without an
initial sales charge)
---------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------
Classes B and 529-B None Declines from 5% to Classes B and 529-B
zero for redemptions convert to classes A and
within six years of 529-A, respectively, after
purchase eight years
---------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------
Class C None 1% for redemptions within Class C converts to Class F
one year of purchase after 10 years
---------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------
Class 529-C None 1% for redemptions within None
one year of purchase
---------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------
Class 529-E None None None
---------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------
Classes F and 529-F None None None
---------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------
Classes R-1, R-2, R-3, None None None
R-4 and R-5
---------------------------------------------------------------------------------------------------------

Holders of all share classes have equal pro rata rights to assets, dividends and
liquidation. Each share class has identical voting rights, except for the
exclusive right to vote on matters affecting only its class. Share classes have
different fees and expenses ("class-specific fees and expenses"), primarily due
to different arrangements for distribution, administrative and shareholder
services. Differences in class-specific fees and expenses will result in
differences in net investment income and, therefore, the payment of different
per-share dividends by each class.

SIGNIFICANT ACCOUNTING POLICIES - The financial statements have been prepared to
comply with accounting principles generally accepted in the United States of
America. These principles require management to make estimates and assumptions
that affect reported amounts and disclosures. Actual results could differ from
those estimates. The following is a summary of the significant accounting
policies followed by the fund:

SECURITY VALUATION - Equity securities are valued at the official
closing price of, or the last reported sale price on, the exchange or
market on which such securities are traded, as of the close of business
on the day the securities are being valued or, lacking any sales, at
the last available bid price. Prices for each security are taken from
the principal exchange or market in which the security trades.
Fixed-income securities are valued at prices obtained from an
independent pricing service, when such prices are available. However,
where the investment adviser deems it appropriate, such securities will
be valued at the mean quoted bid and asked prices or at prices for
securities of comparable maturity, quality and type. Short-term
securities maturing within 60 days are valued at amortized cost, which
approximates market value. The ability of the issuers of the debt
securities held by the fund to meet their obligations may be affected
by economic developments in a specific industry, state or region.
Securities and other assets for which representative market quotations
are not readily available are fair valued as determined in good faith
by authority of the fund's Board of Directors. If events occur that
materially affect the value of securities (particularly non-U.S.
securities) between the close of trading in those securities and the
close of regular trading on the New York Stock Exchange, the securities
are fair valued.

SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME - Security
transactions are recorded by the fund as of the date the trades are
executed with brokers. Realized gains and losses from security
transactions are determined based on the specific identified cost of
the securities. Dividend income is recognized on the ex-dividend date
and interest income is recognized on an accrual basis. Market
discounts, premiums and original issue discounts on fixed-income
securities are amortized daily over the expected life of the security.

CLASS ALLOCATIONS - Income, fees and expenses (other than
class-specific fees and expenses) and realized and unrealized gains and
losses are allocated daily among the various share classes based on
their relative net assets. Class-specific fees and expenses, such as
distribution, administrative and shareholder services, are charged
directly to the respective share class.

DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS - Dividends and
distributions paid to shareholders are recorded on the ex-dividend
date.

NON-U.S. CURRENCY TRANSLATION - Assets and liabilities, including
investment securities, denominated in non-U.S. currencies are
translated into U.S. dollars at the exchange rates in effect at the end
of the reporting period. Purchases and sales of investment securities
and income and expenses are translated into U.S. dollars at the
exchange rates on the dates of such transactions. In the accompanying
financial statements, the effects of changes in non-U.S. exchange rates
on investment securities are included with the net realized gain or
loss and net unrealized appreciation or depreciation on investments.
The realized gain or loss and unrealized appreciation or depreciation
resulting from all other transactions denominated in non-U.S.
currencies are disclosed separately.

FORWARD CURRENCY CONTRACTS - The fund may enter into forward currency
contracts, which represent agreements to exchange non-U.S. currencies
on specific future dates at predetermined rates. The fund enters into
these contracts to manage its exposure to changes in non-U.S. exchange
rates arising from investments denominated in non-U.S. currencies. Upon
entering into these contracts, risks may arise from the potential
inability of counterparties to meet the terms of their contracts and
from possible movements in non-U.S. exchange rates. Due to these risks,
the fund could incur losses up to the entire contract amount, which may
exceed the net unrealized value shown in the accompanying financial
statements. On a daily basis, the fund values forward currency
contracts based on the applicable exchange rates and records unrealized
gains or losses. The fund records realized gains or losses at the time
the forward contract is closed or offset by another contract with the
same broker for the same settlement date and currency.

SECURITIES LENDING - The fund may lend portfolio securities from time
to time in order to earn additional income; however, it does not
currently intend to engage in an ongoing or regular securities lending
program. When the fund lends securities, it receives collateral in an
amount not less than 100% of the market value of the loaned securities
throughout the period of the loan. The market value of the loaned
securities is determined at the close of business of the fund and any
additional required collateral is delivered on the next business day.
If the borrower defaults on its obligation to return the securities
loaned, the fund could experience delays and costs in recovering the
securities loaned or in gaining access to the collateral. Income earned
is included in interest income in the accompanying financial
statements.

2. NON-U.S. INVESTMENTS

INVESTMENT RISK - The risks of investing in securities of non-U.S. issuers may
include, but are not limited to, investment and repatriation restrictions;
revaluation of currencies; adverse political, social and economic developments;
government involvement in the private sector; limited and less reliable investor
information; lack of liquidity; certain local tax law considerations; and
limited regulation of the securities markets.

TAXATION - Dividend and interest income is recorded net of non-U.S. taxes paid.
Gains realized by the fund on the sale of securities in certain countries are
subject to non-U.S. taxes. The fund records a liability based on unrealized
gains to provide for potential non-U.S. taxes payable upon the sale of these
securities. For the year ended November 30, 2003, there were no non-U.S. taxes
paid on realized gains. As of November 30, 2003, non-U.S. taxes provided on
unrealized gains were $6,661,000.

3. FEDERAL INCOME TAXATION AND DISTRIBUTIONS

The fund complies with the requirements under Subchapter M of the Internal
Revenue Code applicable to mutual funds and intends to distribute substantially
all of its net taxable income and net capital gains each year. The fund is not
subject to income taxes to the extent such distributions are made.

DISTRIBUTIONS - Distributions paid to shareholders are based on net investment
income and net realized gains determined on a tax basis, which may differ from
net investment income and net realized gains for financial reporting purposes.
These differences are due primarily to differing treatment for items such as
non-U.S. currency gains and losses; short-term capital gains and losses; capital
losses related to sales of securities within 30 days of purchase; unrealized
appreciation of certain investments in non-U.S. securities; deferred expenses;
and net capital losses. The fiscal year in which amounts are distributed may
differ from the year in which the net investment income and net realized gains
are recorded by the fund. As of November 30, 2003, the cost of investment
securities and cash denominated in non-U.S. currencies, for federal income tax
purposes was $13,783,141,000.

During the year ended November 30, 2003, the fund reclassified $501,000 from
undistributed net realized gains to undistributed net investment income to align
financial reporting with tax reporting.

As of November 30, 2003, the components of distributable earnings on a tax basis
were as follows:

[Download Table]

(dollars in thousands)
Undistributed net investment income and currency gains $208,854
Undistributed short-term capital gains 45,235
Undistributed long-term capital gains 129,024
Gross unrealized appreciation on investment securities 3,291,854
Gross unrealized depreciation on investment securities (394,343)

These numbers reflect the utilization of the remaining capital loss carryforward
of $52,223,000.

Distributions paid to shareholders from net investment income were as follows
(dollars in thousands):

[Download Table]

Year ended November 30
Share class 2003 2002(1)
Class A $ 254,064 $ 208,278
Class B 4,808 2,354
Class C 4,321 1,551
Class F 5,139 1,874
Class 529-A 1,080 233
Class 529-B 138 29
Class 529-C 225 50
Class 529-E 49 7
Class 529-F 16 -*
Class R-1 27 1
Class R-2 421 8
Class R-3 512 10
Class R-4 146 1
Class R-5 1,696 600
Total $ 272,642 $ 214,996

* Amount less than one thousand.
(1) Class 529-A, 529-B, 529-C, 529-E and 529-F shares were offered beginning
February 15, 2002. Class R-1, R-2, R-3, R-4 and R-5 shares were
offered beginning May 15, 2002.

4. FEES AND TRANSACTIONS WITH RELATED PARTIES

Capital Research and Management Company ("CRMC"), the fund's investment adviser,
is the parent company of American Funds Service Company ("AFS"), the fund's
transfer agent, and American Funds Distributors, Inc. ("AFD"), the principal
underwriter of the fund's shares.

INVESTMENT ADVISORY SERVICES - The Investment Advisory and Service Agreement
with CRMC provides for monthly fees accrued daily. These fees are based on a
declining series of annual rates beginning with 0.600% on the first $500 million
of daily net assets and decreasing to 0.385% on such assets in excess of $17
billion. For the year ended November 30, 2003, the investment advisory services
fee was $50,748,000, which was equivalent to an annualized rate of 0.415% of
average daily net assets.

CLASS-SPECIFIC FEES AND EXPENSES - Expenses that are specific to individual
share classes are accrued directly to the respective share class. The principal
class-specific fees and expenses are described below:

DISTRIBUTION SERVICES - The fund has adopted plans of distribution for
all share classes, except Class R-5. Under the plans, the Board of
Directors approves certain categories of expenses that are used to
finance activities primarily intended to sell fund shares. The plans
provide for annual expenses, based on a percentage of average daily net
assets, ranging from 0.30% to 1.00% as noted below. In some cases, the
Board of Directors has approved expense amounts lower than plan limits.

[Enlarge/Download Table]

------------------------------------------------ ----------------------------- -----------------------------
SHARE CLASS CURRENTLY APPROVED LIMITS PLAN LIMITS
------------------------------------------------ ----------------------------- -----------------------------
------------------------------------------------ ----------------------------- -----------------------------
Class A 0.30% 0.30%
------------------------------------------------ ----------------------------- -----------------------------
------------------------------------------------ ----------------------------- -----------------------------
Class 529-A 0.30 0.50
------------------------------------------------ ----------------------------- -----------------------------
------------------------------------------------ ----------------------------- -----------------------------
Classes B and 529-B 1.00 1.00
------------------------------------------------ ----------------------------- -----------------------------
------------------------------------------------ ----------------------------- -----------------------------
Classes C, 529-C and R-1 1.00 1.00
------------------------------------------------ ----------------------------- -----------------------------
------------------------------------------------ ----------------------------- -----------------------------
Class R-2 0.75 1.00
------------------------------------------------ ----------------------------- -----------------------------
------------------------------------------------ ----------------------------- -----------------------------
Classes 529-E and R-3 0.50 0.75
------------------------------------------------ ----------------------------- -----------------------------
------------------------------------------------ ----------------------------- -----------------------------
Classes F, 529-F and R-4 0.25 0.50
------------------------------------------------ ----------------------------- -----------------------------

All share classes may use up to 0.25% average daily net assets to pay
service fees, or to compensate AFD for paying service fees, to firms
that have entered into agreements with AFD for providing certain
shareholder services. Expenses in excess of these amounts, up to
approved limits, may be used to compensate dealers and wholesalers for
shares sold.

For classes A and 529-A, the Board of Directors has also approved the
reimbursement of dealer and wholesaler commissions paid by AFD for
certain shares sold without a sales charge. Each class reimburses AFD
for amounts billed within the prior 15 months but only to the extent
that the overall annual expense limit of 0.30% is not exceeded. As of
November 30, 2003, there were no unreimbursed expenses subject to
reimbursement for classes A or 529-A.

TRANSFER AGENT SERVICES - The fund has a transfer agent agreement with
AFS for classes A and B. Under this agreement, these share classes
compensate AFS for transfer agent services including shareholder
recordkeeping, communications and transaction processing. AFS is also
compensated for certain transfer agent services provided to all other
share classes from the administrative services fees paid to CRMC
described below.

ADMINISTRATIVE SERVICES - The fund has an administrative services
agreement with CRMC to provide transfer agent and other related
shareholder services for all classes of shares other than classes A and
B. Each relevant class pays CRMC annual fees of 0.15% (0.10% for Class
R-5) based on its respective average daily net assets. Each relevant
class also pays AFS additional amounts for certain transfer agent
services. CRMC and AFS may use these fees to compensate third parties
for performing these services. During the start-up period for classes
R-1, R-2, R-3 and R-4, CRMC has voluntarily agreed to pay a portion of
these fees. Each 529 share class is subject to an additional annual
administrative services fee of 0.10% of its respective average daily
net assets; this fee is payable to the Commonwealth of Virginia for the
maintenance of the CollegeAmerica plan. Although these amounts are
included with administrative services fees in the accompanying
financial statements, the Commonwealth of Virginia is not considered a
related party. Administrative services fees are presented gross of any
payments made by CRMC.

Expenses under the agreements described above for the year ended
November 30, 2003, were as follows (dollars in thousands):

[Enlarge/Download Table]

---------------------------------------------------------------------------------------------------------------
Administrative services

---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
Share class Distribution Transfer agent CRMC Transfer agent Commonwealth of
services services administrative services Virginia
services administrative
services
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
Class A $28,180 $10,393 Not applicable Not applicable Not applicable
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
Class B 3,157 359 Not applicable Not applicable Not applicable
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
Class C 2,988 Included $448 $97 Not applicable
in
administrative
services
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
Class F 622 Included 373 67 Not applicable
in
administrative
services
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
Class 529-A 71 Included 77 8 $ 52
in
administrative
services
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
Class 529-B 101 Included 15 6 10
in
administrative
services
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
Class 529-C 163 Included 25 8 16
in
administrative
services
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
Class 529-E 14 Included 4 -* 3
in
administrative
services
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
Class 529-F 2 Included 1 -* -*
in
administrative
services
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
Class R-1 21 Included 3 4 Not applicable
in
administrative
services
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
Class R-2 207 Included 42 242 Not applicable
in
administrative
services
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
Class R-3 159 Included 48 57 Not applicable
in
administrative
services
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
Class R-4 21 Included 12 4 Not applicable
in
administrative
services
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
Class R-5 Not applicable Included 70 2 Not applicable
in
administrative
services
---------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------
Total $35,706 $10,752 $1,118 $495 $81
---------------------------------------------------------------------------------------------------------------
* Amount less than one thousand.

DEFERRED DIRECTORS' COMPENSATION - Since the adoption of the deferred
compensation plan in 1993, Directors who are unaffiliated with CRMC may elect to
defer the cash payment of part or all of their compensation. These deferred
amounts, which remain as liabilities of the fund, are treated as if invested in
shares of the fund or other American Funds. These amounts represent general,
unsecured liabilities of the fund and vary according to the total returns of the
selected funds. Directors' compensation in the accompanying financial statements
includes the current fees (either paid in cash or deferred) and the net increase
or decrease in the value of the deferred amounts.

AFFILIATED OFFICERS AND DIRECTORS - Officers and certain Directors of the fund
are or may be considered to be affiliated with CRMC, AFS and AFD. No affiliated
officers or Directors received any compensation directly from the fund.

5. CAPITAL SHARE TRANSACTIONS

Capital share transactions in the fund were as follows (dollars and shares in
thousands):

[Enlarge/Download Table]

Reinvestments of
Share class Sales(1) dividends and distributions
Amount Shares Amount Shares
Year ended November 30, 2003
Class A $3,476,313 140,934 $ 237,800 10,000
Class B 259,243 10,380 4,639 194
Class C 418,374 16,667 4,056 169
Class F 433,428 17,892 4,586 190
Class 529-A 50,028 2,023 1,080 45
Class 529-B 9,652 396 138 6
Class 529-C 16,305 665 225 9
Class 529-E 3,123 128 49 2
Class 529-F 1,100 46 16 1
Class R-1 4,397 180 27 1
Class R-2 49,218 2,044 421 17
Class R-3 69,964 2,827 511 21
Class R-4 24,692 964 145 6
Class R-5 41,012 1,628 1,282 53
Total net increase
(decrease) $4,856,849 196,774 $ 254,975 10,714

Year ended November 30, 2002(2)
Class A $2,122,788 90,372 $ 194,311 8,192
Class B 130,869 5,543 2,266 97
Class C 198,372 8,536 1,464 63
Class F 202,758 8,645 1,659 71
Class 529-A 29,154 1,224 233 10
Class 529-B 5,290 225 29 1
Class 529-C 8,700 366 50 2
Class 529-E 1,210 52 7 -*
Class 529-F 127 6 -* -*
Class R-1 182 8 1 -*
Class R-2 5,622 261 8 1
Class R-3 5,069 233 10 1
Class R-4 1,571 72 1 -*
Class R-5 60,666 2,447 493 22
Total net increase
(decrease) $2,772,378 117,990 $ 200,532 8,460

Share class Repurchases(1) Net increase (decrease)
Amount Shares Amount Shares
Year ended November 30, 2003
Class A $ (1,776,963) (76,452) $ 1,937,150 74,482
Class B (32,120) (1,375) 231,762 9,199
Class C (71,149) (3,097) 351,281 13,739
Class F (185,371) (8,093) 252,643 9,989
Class 529-A (1,204) (51) 49,904 2,017
Class 529-B (166) (7) 9,624 395
Class 529-C (336) (14) 16,194 660
Class 529-E (92) (4) 3,080 126
Class 529-F -* (1) 1,116 46
Class R-1 (341) (13) 4,083 168
Class R-2 (6,714) (281) 42,925 1,780
Class R-3 (9,216) (382) 61,259 2,466
Class R-4 (4,158) (175) 20,679 795
Class R-5 (3,691) (152) 38,603 1,529
Total net increase
(decrease) $ (2,091,521) (90,097) $ 3,020,303 117,391

Year ended November 30, 2002(2)
Class A $ (1,976,245) (85,210) $ 340,854 13,354
Class B (27,646) (1,229) 105,489 4,411
Class C (62,951) (2,813) 136,885 5,786
Class F (98,126) (4,212) 106,291 4,504
Class 529-A (375) (17) 29,012 1,217
Class 529-B (40) (2) 5,279 224
Class 529-C (81) (3) 8,669 365
Class 529-E (13) (1) 1,204 51
Class 529-F - - 127 6
Class R-1 (31) (2) 152 6
Class R-2 (543) (26) 5,087 236
Class R-3 (449) (21) 4,630 213
Class R-4 (88) (4) 1,484 68
Class R-5 (3,299) (145) 57,860 2,324
Total net increase
(decrease) $ (2,169,887) (93,685) $ 803,023 32,765

* Amount less than one thousand.
(1) Includes exchanges between share classes of the fund.
(2) Class 529-A, 529-B, 529-C, 529-E and 529-F shares were offered beginning
February 15, 2002. Class R-1, R-2, R-3, R-4 and R-5 shares were offered
beginning May 15, 2002.

6. RESTRICTED SECURITIES

The fund has invested in certain securities for which resale may be limited to
qualified buyers or which are otherwise restricted. These securities are
identified in the investment portfolio. As of November 30, 2003, the total value
of restricted securities was $773,026,000, which represented 4.62% of the net
assets of the fund.

7. INVESTMENT TRANSACTIONS AND OTHER DISCLOSURES

The fund made purchases and sales of investment securities, excluding short-term
securities, of $4,985,435,000 and $2,954,681,000, respectively, during the year
ended November 30, 2003.

The fund receives a reduction in its custodian fee equal to the amount of
interest calculated on certain cash balances held at the custodian bank. For the
year ended November 30, 2003, the custodian fee of $3,355,000 includes $18,000
that was offset by this reduction, rather than paid in cash.

FINANCIAL HIGHLIGHTS (1)

[Enlarge/Download Table]

Income (loss) from
investment operations(2)

Net
Net asset gains(losses)
value, Net on securities Total from
beginning investment (both realized investment
of period income and unrealized) operations
Class A:
Year ended 11/30/2003 $22.80 $.65 $5.73 $6.38
Year ended 11/30/2002 24.29 .52 (1.53) (1.01)
Year ended 11/30/2001 28.29 .53 (.90) (.37)
Year ended 11/30/2000 29.03 .62 1.20 1.82
Year ended 11/30/1999 27.15 .48 4.17 4.65
Class B:
Year ended 11/30/2003 22.72 .45 5.72 6.17
Year ended 11/30/2002 24.21 .27 (1.45) (1.18)
Year ended 11/30/2001 28.21 .31 (.87) (.56)
Period from 3/15/2000 to 11/30/2000 29.57 .32 (1.41) (1.09)
Class C:
Year ended 11/30/2003 22.68 .42 5.71 6.13
Year ended 11/30/2002 24.18 .20 (1.40) (1.20)
Period from 3/15/2001 to 11/30/2001 25.35 .12 (1.15) (1.03)
Class F:
Year ended 11/30/2003 22.78 .61 5.75 6.36
Year ended 11/30/2002 24.27 .31 (1.34) (1.03)
Period from 3/15/2001 to 11/30/2001 25.40 .27 (1.15) (.88)
Class 529-A:
Year ended 11/30/2003 22.78 .63 5.73 6.36
Period from 2/15/2002 to 11/30/2002 24.29 .36 (1.47) (1.11)
Class 529-B:
Year ended 11/30/2003 22.74 .40 5.73 6.13
Period from 2/21/2002 to 11/30/2002 23.96 .23 (1.13) (.90)
Class 529-C:
Year ended 11/30/2003 22.74 .41 5.71 6.12
Period from 2/22/2002 to 11/30/2002 23.98 .23 (1.15) (.92)
Class 529-E:
Year ended 11/30/2003 22.77 .54 5.73 6.27
Period from 3/4/2002 to 11/30/2002 25.12 .31 (2.28) (1.97)
Class 529-F:
Year ended 11/30/2003 22.80 .61 5.72 6.33
Period from 9/17/2002 to 11/30/2002 21.79 .08 1.07 1.15
Class R-1:
Year ended 11/30/2003 22.75 .38 5.77 6.15
Period from 6/7/2002 to 11/30/2002 25.08 .14 (2.37) (2.23)
Class R-2:
Year ended 11/30/2003 22.73 .43 5.71 6.14
Period from 6/7/2002 to 11/30/2002 25.08 .13 (2.35) (2.22)
Class R-3:
Year ended 11/30/2003 22.77 .50 5.75 6.25
Period from 6/6/2002 to 11/30/2002 25.42 .17 (2.52) (2.35)
Class R-4:
Year ended 11/30/2003 22.81 .55 5.80 6.35
Period from 6/27/2002 to 11/30/2002 23.78 .20 (1.02) (.82)
Class R-5:
Year ended 11/30/2003 22.81 .70 5.74 6.44
Period from 5/15/2002 to 11/30/2002 26.11 .30 (3.27) (2.97)

Dividends and distributions

Dividends
(from net Distributions Net asset
investment (from capital Total value, end
income) gains) distributions of period
Class A:
Year ended 11/30/2003 $(.56) $ - $(.56) $28.62
Year ended 11/30/2002 (.48) - (.48) 22.80
Year ended 11/30/2001 (.50) (3.13) (3.63) 24.29
Year ended 11/30/2000 (.58) (1.98) (2.56) 28.29
Year ended 11/30/1999 (.48) (2.29) (2.77) 29.03
Class B:
Year ended 11/30/2003 (.39) - (.39) 28.50
Year ended 11/30/2002 (.31) - (.31) 22.72
Year ended 11/30/2001 (.31) (3.13) (3.44) 24.21
Period from 3/15/2000 to 11/30/2000 (.27) - (.27) 28.21
Class C:
Year ended 11/30/2003 (.38) - (.38) 28.43
Year ended 11/30/2002 (.30) - (.30) 22.68
Period from 3/15/2001 to 11/30/2001 (.14) - (.14) 24.18
Class F:
Year ended 11/30/2003 (.55) - (.55) 28.59
Year ended 11/30/2002 (.46) - (.46) 22.78
Period from 3/15/2001 to 11/30/2001 (.25) - (.25) 24.27
Class 529-A:
Year ended 11/30/2003 (.55) - (.55) 28.59
Period from 2/15/2002 to 11/30/2002 (.40) - (.40) 22.78
Class 529-B:
Year ended 11/30/2003 (.36) - (.36) 28.51
Period from 2/21/2002 to 11/30/2002 (.32) - (.32) 22.74
Class 529-C:
Year ended 11/30/2003 (.36) - (.36) 28.50
Period from 2/22/2002 to 11/30/2002 (.32) - (.32) 22.74
Class 529-E:
Year ended 11/30/2003 (.48) - (.48) 28.56
Period from 3/4/2002 to 11/30/2002 (.38) - (.38) 22.77
Class 529-F:
Year ended 11/30/2003 (.54) - (.54) 28.59
Period from 9/17/2002 to 11/30/2002 (.14) - (.14) 22.80
Class R-1:
Year ended 11/30/2003 (.40) - (.40) 28.50
Period from 6/7/2002 to 11/30/2002 (.10) - (.10) 22.75
Class R-2:
Year ended 11/30/2003 (.42) - (.42) 28.45
Period from 6/7/2002 to 11/30/2002 (.13) - (.13) 22.73
Class R-3:
Year ended 11/30/2003 (.49) - (.49) 28.53
Period from 6/6/2002 to 11/30/2002 (.30) - (.30) 22.77
Class R-4:
Year ended 11/30/2003 (.56) - (.56) 28.60
Period from 6/27/2002 to 11/30/2002 (.15) - (.15) 22.81
Class R-5:
Year ended 11/30/2003 (.62) - (.62) 28.63
Period from 5/15/2002 to 11/30/2002 (.33) - (.33) 22.81

Ratio of Ratio of
Net asset, expenses net income
Total end of period to average to average
return(3) (in millions) net assets net assets
Class A:
Year ended 11/30/2003 28.52% $14,703 .81% 2.70%
Year ended 11/30/2002 (4.22) 10,016 .82 2.22
Year ended 11/30/2001 (1.81) 10,346 .78 2.05
Year ended 11/30/2000 6.37 10,716 .79 2.08
Year ended 11/30/1999 19.08 10,022 .79 1.93
Class B:
Year ended 11/30/2003 27.52 537 1.58 1.85
Year ended 11/30/2002 (4.93) 219 1.59 1.47
Year ended 11/30/2001 (2.57) 126 1.56 1.21
Period from 3/15/2000 to 11/30/2000 (3.73) 55 1.55 (5) 1.45 (5)
Class C:
Year ended 11/30/2003 27.40 615 1.65 1.71
Year ended 11/30/2002 (4.95) 179 1.65 1.43
Period from 3/15/2001 to 11/30/2001 (4.08) 50 1.78 (5) .73 (5)
Class F:
Year ended 11/30/2003 28.43 470 .89 2.49
Year ended 11/30/2002 (4.29) 147 .91 2.17
Period from 3/15/2001 to 11/30/2001 (3.45) 47 .92 (5) 1.55 (5)
Class 529-A:
Year ended 11/30/2003 28.43 93 .87 2.55
Period from 2/15/2002 to 11/30/2002 (4.61) 28 1.03 (5) 2.08 (5)
Class 529-B:
Year ended 11/30/2003 27.28 18 1.78 1.64
Period from 2/21/2002 to 11/30/2002 (3.82) 5 1.79 (5) 1.31 (5)
Class 529-C:
Year ended 11/30/2003 27.25 29 1.76 1.66
Period from 2/22/2002 to 11/30/2002 (3.90) 8 1.77 (5) 1.33 (5)
Class 529-E:
Year ended 11/30/2003 27.97 5 1.23 2.17
Period from 3/4/2002 to 11/30/2002 (7.88) 1 1.23 (5) 1.85 (5)
Class 529-F:
Year ended 11/30/2003 28.31 1 .98 2.48
Period from 9/17/2002 to 11/30/2002 5.33 - (4) .20 .39
Class R-1:
Year ended 11/30/2003 27.43 5 1.66 (6) 1.48
Period from 6/7/2002 to 11/30/2002 (8.85) - (4) .80 (6) .66
Class R-2:
Year ended 11/30/2003 27.44 57 1.62 (6) 1.72
Period from 6/7/2002 to 11/30/2002 (8.80) 5 .79 (6) .61
Class R-3:
Year ended 11/30/2003 27.90 76 1.24 (6) 1.98
Period from 6/6/2002 to 11/30/2002 (9.25) 5 .60 (6) .80
Class R-4:
Year ended 11/30/2003 28.36 25 .89 (6) 2.18
Period from 6/27/2002 to 11/30/2002 (3.42) 2 .38 (6) .92
Class R-5:
Year ended 11/30/2003 28.82 110 .56 2.88
Period from 5/15/2002 to 11/30/2002 (11.37) 53 .56 (5) 2.48 (5)

[Enlarge/Download Table]

Year ended November 30

2003 2002 2001 2000 1999

Portfolio turnover rate for all classes of shares 27% 32% 45% 41% 34%

(1) Based on operations for the period shown (unless otherwise noted) and,
accordingly, may not be representative of a full year.
(2) Year ended 1999 is based on shares outstanding on the last day of
the year; all other periods are
based on average shares outstanding.
(3) Total returns exclude all sales charges, including contingent
deferred sales charges.
(4) Amount less than 1 million.
(5) Annualized.
(6) During the start-up period for this class, CRMC voluntarily agreed to
pay a portion of the fees relating to transfer agent services.
Had CRMC not paid such fees, expense ratios would have been 1.78%,
2.23%, 1.29% and .90% for classes R-1, R-2, R-3 and R-4,
respectively, during the year ended November 30, 2003, and 1.41%,
.93%, .69% and .46% for classes R-1, R-2, R-3 and R-4,
respectively, during the period ended November 30, 2002.

REPORT OF INDEPENDENT AUDITORS

TO THE BOARD OF DIRECTORS AND SHAREHOLDERS OF CAPITAL WORLD GROWTH AND
INCOME FUND, INC.:

In our opinion, the accompanying statement of assets and liabilities, including
the investment portfolio, and the related statements of operations and changes
in net assets and the financial highlights present fairly, in all material
respects, the financial position of Capital World Growth and Income Fund, Inc.
(the "Fund") at November 30, 2003, and the results of its operations, the
changes in its net assets and its financial highlights for each of the periods
presented in conformity with accounting principles generally accepted in the
United States of America. These financial statements and financial highlights
(hereafter referred to as "financial statements") are the responsibility of the
Fund's management; our responsibility is to express an opinion on these
financial statements based on our audits. We conducted our audits of these
financial statements in accordance with auditing standards generally accepted in
the United States of America, which require that we plan and perform the audits
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements, assessing
the accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits, which included confirmation of securities owned at November 30, 2003 by
correspondence with the custodian and brokers, provide a reasonable basis for
our opinion.

PRICEWATERHOUSE COOPERS, LLP

Los Angeles, California
December 23, 2003

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 certain distributions received by
shareholders during such fiscal year.

The fund makes an election under the Internal Revenue Code Section 853 to pass
through certain non-U.S. taxes paid by the fund to its shareholders as a foreign
tax credit. The amount of foreign tax credit passed through to shareholders for
the fiscal year ended November 30, 2003 is $24,236,000. Foreign source income
earned by the fund for the fiscal year ended November 30, 2003 was $308,424,000.
Shareholders are entitled to a foreign tax credit or an itemized deduction, at
their discretion. Generally, it is more advantageous to claim a credit than to
take a deduction.

As a result of recent tax legislation, individual shareholders are now eligible
for reduced tax rates on qualified dividend income received during 2003. For
purposes of computing the dividends eligible for reduced tax rates, all of the
dividends paid by the fund from net investment income from January 1 through the
end of the fund's fiscal year are considered qualified dividend income.

Corporate shareholders may exclude up to 70% of qualifying dividends received
during the year. For purposes of computing this exclusion, 25.25% of the
dividends paid by the fund from net investment income represent 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 retirement plan trusts may need this information for their annual
information reporting.

SINCE THE INFORMATION ABOVE IS REPORTED FOR THE FUND'S FISCAL YEAR AND NOT THE
CALENDAR YEAR, SHAREHOLDERS SHOULD REFER TO THEIR FORM 1099-DIV OR OTHER TAX
INFORMATION WHICH WILL BE MAILED IN JANUARY 2004 TO DETERMINE THE CALENDAR YEAR
AMOUNTS TO BE INCLUDED ON THEIR 2003 TAX RETURNS. SHAREHOLDERS SHOULD CONSULT
THEIR TAX ADVISERS.

CAPITAL WORLD GROWTH AND INCOME FUND, INC.

Part B
Retirement Plan
Statement of Additional Information

February 1, 2004
(as amended March 1, 2004)

This document is not a prospectus but should be read in conjunction with the
current Retirement Plan Prospectus of Capital World Growth and Income Fund (the
"fund" or "WGI") dated February 1, 2004. The prospectus may be obtained from
your financial adviser or by writing to the fund at the following address:

Capital World Growth and Income Fund, Inc.
Attention: Secretary
333 South Hope Street
Los Angeles, California 90071
(213) 486-9200

TABLE OF CONTENTS

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Item Page No.
---- --------

Certain Investment Limitations and Guidelines . . . . . . . . . . . 2
Description of Certain Securities and Investment Techniques . . . . 2
Fundamental Policies and Investment Restrictions. . . . . . . . . . 7
Management of the Fund. . . . . . . . . . . . . . . . . . . . . . . 10
Taxes and Distributions . . . . . . . . . . . . . . . . . . . . . . 23
Purchase, Exchange and Sale of Shares . . . . . . . . . . . . . . . 26
Sales Charges . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Class A Sales Charge Reductions . . . . . . . . . . . . . . . . . . 32
Individual Retirement Account (IRA) Rollovers . . . . . . . . . . . 34
Price of Shares . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Shareholder Account Services and Privileges . . . . . . . . . . . . 36
Execution of Portfolio Transactions . . . . . . . . . . . . . . . . 37
General Information . . . . . . . . . . . . . . . . . . . . . . . . 37
Appendix. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Financial Statements

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CERTAIN INVESTMENT LIMITATIONS AND GUIDELINES

* * * * * *

The fund may experience difficulty liquidating certain portfolio securities
during significant market declines or periods of heavy redemptions.

DESCRIPTION OF CERTAIN SECURITIES AND INVESTMENT TECHNIQUES

The descriptions below are intended to supplement the material in the prospectus
under "Investment Objective, Strategies and Risks."

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Certain additional risk factors relating to debt securities are discussed below:

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or may be redeemed, in one year or less, and (v) corporate bonds and notes that
mature, or that may be redeemed, in one year or less.

* * * * * *

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FUNDAMENTAL POLICIES AND INVESTMENT RESTRICTIONS

These restrictions provide that the fund may not:

6. Invest in companies for the purpose of exercising control or management;

7. Make loans to others except for (a) purchasing debt securities; (b)
entering into repurchase agreements; and (c) loaning portfolio securities;

8. Issue senior securities, except as permitted under the Investment Company
Act of 1940 as amended (the (Alpha)1940 Act^);

9. Borrow money, except from banks for temporary purposes in an amount not to
exceed one-third of the value of the fund's total assets. Moreover, in the event
that the asset coverage for

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such borrowing falls below 300%, the fund will reduce, within three days, the
amount of its borrowing in order to provide for 300% asset coverage;

10. Pledge or hypothecate assets in excess of one-third of the fund's total
assets; or

11. Purchase or sell puts, calls, straddles, or spreads, or combinations
thereof (except for currency options).

NON-FUNDAMENTAL POLICIES - The following non-fundamental policies may be changed
without shareholder approval:

4. The fund does not currently intend (at least for the next 12 months) to
invest in oil, gas, or other mineral exploration or development programs or
leases.

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8. The fund does not currently intend (at least for the next 12 months) to
invest more than 5% of its net assets in restricted securities (excluding Rule
144A securities and 4(2) commercial paper).

9. The fund does not currently intend (at least for the next 12 months) to
purchase securities in the event its borrowings exceed 5% of its net assets.

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MANAGEMENT OF THE FUND

BOARD OF DIRECTORS AND OFFICERS

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* Company affiliated with Capital Research and Management Company.
1 Directors and officers of the fund serve until their resignation, removal or
retirement.

THE ADDRESS FOR ALL DIRECTORS AND OFFICERS OF THE FUND IS 333 SOUTH HOPE STREET
- 55TH FLOOR, LOS ANGELES, CALIFORNIA 90071, ATTENTION: FUND SECRETARY.

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FUND SHARES OWNED BY DIRECTORS AS OF DECEMBER 31, 2003

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DIRECTOR COMPENSATION PAID DURING THE FISCAL YEAR ENDED NOVEMBER 30, 2003

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As of January 1, 2004, the officers and Directors of the fund and their
families, as a group, owned beneficially or of record less than 1% of the
outstanding shares of the fund.

Capital World Growth and Income Fund - Page 15

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The fund has several different classes of shares, including Class A, B, C, F,
529-A, 529-B, 529-C, 529-E, 529-F, R-1, R-2, R-3, R-4 and R-5 shares. Class R
shares are generally only available to employer-sponsored retirement plans. The
B, C, F and 529 share classes are described in more detail in the fund's retail
prospectus and retail statement of additional information. The shares of each
class represent an interest in the same investment portfolio. Each class has pro
rata rights as to voting, redemption, dividends and liquidation, except that
each class bears different distribution expenses and may bear different transfer
agent fees and other expenses properly attributable to the particular class as
approved by the Board of Directors and set forth in the fund's rule 18f-3 Plan.
Each class' shareholders have exclusive voting rights with respect to the
respective class' rule 12b-1 Plans adopted in connection with the distribution
of shares and on other matters in which the interests of one class are different
from interests in another class. Shares of all classes of the fund vote together
on matters that affect all classes in substantially the same manner. Each class
votes as a class on matters that affect that class alone.

COMMITTEES OF THE BOARD OF DIRECTORS - The fund has an Audit Committee comprised
of H. Frederick Christie, Merit E. Janow, Mary Myers Kauppila, Robert J.
O'Neill, Steadman Upham and Charles Wolf, Jr., none of whom is an "interested
person" of the fund within the meaning of the 1940 Act. The Committee provides
oversight regarding the fund's accounting and financial reporting policies and
practices, its internal controls and the internal controls of the fund's
principal service providers. The Committee acts as a liaison between the fund's
independent auditors and the full Board of Directors. Four Audit Committee
meetings were held during the 2003 fiscal year.

Capital World Growth and Income Fund - Page 16

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and Service Agreement, Principal Underwriting Agreement, Administrative Services
Agreement and Plans of Distribution under rule 12b-1 of the 1940 Act, that the
fund may enter into, renew or continue, and to make its recommendations to the
full Board of Directors on these matters. One Contracts Committee meeting was
held during the 2003 fiscal year.

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NAME AND ADDRESS OWNERSHIP PERCENTAGE
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Edward D. Jones & Co. Class A 19.32%
201 Progress Pkwy.
Maryland Heights, MO 63043-3009
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CNA Trust Corp. TTEE Class R-1 29.55
FBO Omnibus/Spectrum
P.O. Box 5024
Costa Mesa, CA 92628-5024
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CNA Trust Corp. TTEE Class R-1 9.47
FBO IIAA 401K Plan
P.O. Box 5024
Costa Mesa, CA 92628-5024
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George W. Redder TTEE Class R-1 7.95
George W. Redder PSRP & TR
243 Wall St.
Kingston, NY 12401-3837
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MLPF&S For the Sole Benefit of Its Customers Class R-3 15.07
4800 Deer Lake Dr. E., Fl. 2
Jacksonville, FL 32246-6484
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Nationwide Trust Company FSB Class R-3 8.71
c/o IPO Portfolio Accounting
P.O. Box 182029
Columbus, OH 43218-2029
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CB&T Trustee For Class R-4 5.50
Robert Talbot Inc. 401K Plan
8515 E. Orchard Rd. #2T2
Greenwood Vlg., CO 80111-5002
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BB&T TTEE Class R-4 8.66
BB&T CEB 401K
434 Fayetteville Street Mall, Fl. 4
Raleigh, NC 27601-1701
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Charles Schwab & Co. Inc. Class R-4 23.08
101 Montgomery St.
San Francisco, CA 94104-4122
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NFSC FEBO # 251-075485 Class R-4 9.28
Terrance/Stephen Dunn/LongTT Dunn
401K Ret. & Tr.
929 Holmes St.
Kansas City, MO 64106-2639
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The Northern Trust TTEE Class R-5 6.36
UBS Painewebber Savings Inv. Pl.
P.O. Box 92994
Chicago, IL 60675-2994
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Security Trust Company TTEE Class R-5 9.01
FBO Dakotas Areawide IBEW-NECA
Savings & Retirement Plan
2390 E. Camelback Rd., Ste. 240
Phoenix, AZ 85016
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CGTC Tr. Capital Group Master Class R-5 37.99
c/o Capital Guardian Trust Co.
333 South Hope St., Fl. 49

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Capital World Growth & Income Fund Inc · 497 · On 3/1/04

Filed On 3/1/04 2:57pm ET · SEC File 33-54444 · Accession Number 894005-4-8

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