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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-21448
Pioneer Tax Advantaged Balanced Trust
(Exact name of registrant as specified in charter)
60 State Street, Boston, MA 02109
(Address of principal executive offices) (ZIP code)
Dorothy E. Bourassa, Pioneer Investment Management, Inc.,
60 State Street, Boston, MA 02109
(Name and address of agent for service)
Registrant's telephone number, including area code: (617) 742-7825
Date of fiscal year end: November 30
Date of reporting period: December 1, 2004 through May 31, 2005
Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. ss. 3507.
ITEM 1. REPORTS TO SHAREOWNERS.
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PIONEER
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TAX ADVANTAGED
BALANCED
TRUST
Semiannual
Report
5/31/05
[LOGO]PIONEER
Investments(R)
Table of Contents
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Letter to Shareowners 1
Portfolio Summary 2
Performance Update 3
Portfolio Management Discussion 5
Schedule of Investments 8
Financial Statements 24
Notes to Financial Statements 28
Trustees, Officers and Service Providers 37
Pioneer Tax Advantaged Balanced Trust
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LETTER TO SHAREOWNERS 5/31/05
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Dear Shareowner,
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U.S. equity markets stumbled early in the year before advancing to three-year
highs in March. Stocks spent much of April retracing their gains, as higher
interest rates and soaring energy prices overwhelmed sentiment. Then a brisk
May rally left the Dow Industrials, the Standard and Poor's 500 Stock Index and
the NASDAQ Composite slightly below year-end levels.
With investors less welcoming of risk and the economy giving mixed signals,
value stocks were more resilient than growth stocks. Large-capitalization
stocks held up better than small- and mid-sized issues that might be seen as
more vulnerable in an economic "soft patch," in the phrase of Federal Reserve
Board Chairman Alan Greenspan. The possibility of slower growth
notwithstanding, the Fed continued to raise short-term rates in an effort to
head off damaging inflation.
Bond returns were modestly negative overall early in the year, and fixed-income
investors more risk-averse. High-yield and other corporate sectors retrenched
after a run of stellar performance while Treasuries and mortgage-backed
securities showed smaller declines. Long-term bond prices rose and their yields
fell, suggesting that investors were not concerned about inflation and offering
a boost to home buyers. Municipal revenue bonds trended higher against a
backdrop of heavy new issuance by states and localities.
Higher U.S. interest rates enhanced the dollar's appeal and brought a pause in
its protracted fall. However, the stronger dollar meant muted returns for U.S.
investors in overseas markets. Globally, economies rich in metals and other
industrial commodities benefited from heavy demand. Meanwhile, growth in Japan
may have stalled, and Europe's halting expansion ran afoul of political issues.
We believe that the U.S. economy and corporate earnings will continue to grow
at a moderate pace. Although oil prices had backed away from their record
highs, steep energy costs and rising interest rates may hold investor attention
for a while. Looking beyond present concerns, Pioneer's global investment
experts continue to find stocks and bonds with attractive long-term potential
for our domestic and international funds.
Expanding your opportunities
This period was like all others; different classes of investments delivered
different returns. That's why allocating your portfolio across several
investment types is one way to seek wider opportunities. Pioneer's disciplined
approach and growing range of products are designed to help you achieve this
important objective. For thoughtful guidance on how to align your portfolio
with your goals, contact your financial professional.
Please consider a fund's investment objective, risks, charges and expenses
carefully before investing. The prospectus contains this and other information
about each fund and should be read carefully before you invest or send money.
To obtain a prospectus and for other information on any Pioneer fund, contact
your financial advisor, call 1-800-225-6292 or visit our web site at
www.pioneerfunds.com.
Respectfully,
/s/ Osbert M. Hood
Osbert M. Hood
President
Pioneer Investment Management, Inc.
Any information in this shareholder report regarding market or economic trends
or the factors influencing the Trust's historical or future performance are
statements of the opinion of Trust management as of the date of this report.
These statements should not be relied upon for any other purposes. Past
performance is no guarantee of future results, and there is no guarantee that
market forecasts discussed will be realized.
1
Pioneer Tax Advantaged Balanced Trust
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PORTFOLIO SUMMARY 5/31/05
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Portfolio Maturity
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(As a percentage of total debt holdings)
[THE FOLLOWING DATA WAS REPRESENTED AS A PIE CHART IN THE PRINTED MATERIAL]
0-1 Year 1.4%
1-3 Years 3.3%
3-6 Years 25.5%
6-8 Years 56.0%
8-10 Years 1.1%
10+ Years 12.7%
Portfolio Diversification
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(As a percentage of total investment portfolio)
[THE FOLLOWING DATA WAS REPRESENTED AS A PIE CHART IN THE PRINTED MATERIAL]
Tax-Exempt Obligations 54.6%
Common Stocks 26.4%
Non Convertible Preferred Stocks 17.7%
Temporary Cash Investment 0.9%
Convertible Preferred Stocks 0.4%
The portfolio is actively managed, and current holdings may be different.
2
Pioneer Tax Advantaged Balanced Trust
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PERFORMANCE UPDATE 5/31/05
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Share Prices and Distributions
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Market Value
per Common Share 5/31/05 11/30/04
$13.20 $12.74
Net Asset Value
per Common Share 5/31/05 11/30/04
$15.10 $14.55
Distributions
per Common Share Income Short-Term Long-Term
(12/1/04 - 5/31/05) Dividends Capital Gains Capital Gains
$0.4122 $ - $ -
10 Largest Holdings
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(As a percentage of total long-term holdings)*
1. Exelon Corp. 1.78%
2. Gila County Industrial Development Authority, 5.55%, 1/1/27 1.58
3. Consolidated Edison, Inc. 1.51
4. Fannie Mae, Series L, 5.125% 1.48
5. Tobacco Settlement Financing Corp., 5.875%, 5/15/39 1.40
6. King County Washington Sewer Revenue, 5.0%, 1/1/35 1.39
7. Puerto Rico Commonwealth Highway & Transportation Authority
Revenue, 5.125%, 7/1/43 1.39
8. Duke Energy Corp. 1.38
9. Montana Health Facility Authority Revenue, RIB, 7.409%, 2/25/25 1.36
10. Ameren Corp. 1.24
* This list excludes temporary cash and derivative instruments. The portfolio
is actively managed, and current holdings may be different.
3
Pioneer Tax Advantaged Balanced Trust
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PERFORMANCE UPDATE 5/31/05
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Investment Returns
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The mountain chart on the right shows the change in value of a $10,000
investment made in common shares of Pioneer Tax Advantaged Balanced Trust at
public offering price, compared to that of the Lehman Brothers Municipal Bond
Index and the S&P 500 Index.
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Cumulative Total Returns
(As of May 31, 2005)
Net Asset Market
Period Value (NAV) Price
Life-of-Trust
(1/28/04) 13.59% -5.13%
1 Year 20.23% 16.79%
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[THE FOLLOWING DATA WAS REPRESENTED AS A MOUNTAIN CHART IN THE PRINTED MATERIAL]
\
Pioneer Lehman Brothers
Tax Advantage Municipal Bond Standard &
Balanced Trust Index Poors 500
-------------- ----- ---------
1/04 $10,000 $10,000 $10,000
$9,460 $9,839 $9,964
5/05 $11,297 $10,623 $10,784
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end
performance results. Current performance may be lower or higher than the
performance data quoted.
Performance data shown represents past performance. Past performance is no
guarantee of future results. Investment return and market price will fluctuate,
and your shares may trade below NAV, due to such factors as interest rate
changes, and the perceived credit quality of borrowers.
Total investment return does not reflect broker sales charges or commissions.
All performance is for common shares of the Trust.
Closed-end funds, unlike open-end funds, are not continuously offered. There is
a one-time public offering and once issued, shares of closed-end funds are sold
in the open market through a stock exchange and frequently trade at prices lower
than their NAV. NAV is total assets less total liabilities, which includes
preferred shares, divided by the number of common shares outstanding.
When NAV is lower than market price, dividends are assumed to be reinvested at
the greater of NAV or 95% of the market price. When NAV is higher, dividends are
assumed to be reinvested at market price.
The performance table and graph do not reflect the deduction of fees and taxes
that a shareowner would pay on Trust distributions or the redemption of Trust
shares.
Index comparison begins January 31, 2004. The Lehman Brothers Municipal Bond
Index is a broad measure of the municipal bond market. The Standard & Poor's 500
Stock Index (the S&P 500) is a commonly used measure of the broad U.S. stock
market. Index returns are calculated monthly, assume reinvestment of dividends
and, unlike Trust returns, do not reflect any fees, expenses or charges. You
cannot invest directly in an Index.
4
Pioneer Tax Advantaged Balanced Trust
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PORTFOLIO MANAGEMENT DISCUSSION 5/31/05
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Investors in Pioneer Tax Advantaged Balanced Trust were rewarded during the
six-month period ended May 31, 2005, as both municipal bonds and large-cap
stocks produced positive returns. In the following interview, David Eurkus,
portfolio manager for the Trust's fixed-income portion, and Walter Hunnewell,
Jr., portfolio manager for the Trust's equity portion, discuss the Trust's
investment strategy and outlook.
Q: How did the Trust perform during the period?
A: For the six-month period ended May 31, 2005, Pioneer Tax Advantaged Balanced
Trust returned 7.08% at net asset value and 6.90% at market price. As of
May 31, 2005, the Trust was selling at a discount of market price to net
asset value of 12.6%. From November 30, 2004 through May 31, 2005, the
Lehman Brothers Municipal Bond Index returned 3.51% and the S&P 500 Index
returned 2.42%.
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent
month-end performance results. Current performance may be lower or higher
than the performance data quoted.
The performance data quoted represents past performance, which is no
guarantee of future results. Investment return and principal value will
fluctuate, and shares, when redeemed, may be worth more or less than their
original cost.
Q: What was the investment environment like during the period?
A: The economic expansion continued, raising concerns about the potential for
accelerating inflation. In this environment, the Federal Reserve
maintained its measured policy of periodically boosting the Federal funds
rate by a quarter percentage point. (The Federal funds rate is the rate
banks charge each other for overnight loans.) As a result of the Fed's
actions, yields on short-term and intermediate-term bonds rose, but yields
on long-term bonds declined, which increased their value as their prices
went up.
Concerns about rising interest rates, along with higher oil prices, were
evident in the performance of the equity markets. While the S&P 500 Index
was up 2.42%, stock prices fluctuated within a broad range, as investors
assessed the impact that higher interest rates and oil prices would have
on corporate profits.
5
Pioneer Tax Advantaged Balanced Trust
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PORTFOLIO MANAGEMENT DISCUSSION 5/31/05 (continued)
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Q: What were the principal strategies used in managing the fixed-income portion
of the Trust?
A: On May 31, 2005, municipal securities accounted for 55% of portfolio assets.
We primarily emphasized high-quality, investment-grade bonds, although we
continued to maintain a 12.8% position in selected below investment-grade
securities, which we believed were undervalued. The lower-quality
securities helped the Trust maintain a relatively high level of income.
They also added principal appreciation. At the end of the period, the
credit quality breakdown of the fixed-income portion of the Trust was: AAA
(26.4%); AA (10.3%); A (22.6%); BBB (27.0%); BB and lower (12.8%).
The largest allocation of fixed-income assets was to insured bonds
(22.8%), various revenue bonds (22.4%) and special revenue bonds (5.0%).
The Trust was diversified across a variety of economic sectors. Health
care/hospitals accounted for 31.1%, education 5.5%, housing 3.3%,
pollution control 2.4%, transportation 4.0%, and water and sewer 1.5%.
During the period, we maintained our hedging strategy, which was
implemented early in 2004. At that time, short-term interest rates were at
historically low levels, but long-term rates were relatively high. This
situation allowed us to borrow funds at low short-term rates to invest in
long-term municipal bonds. This leveraging strategy helped augment the
Trust's income. On May 31, 2005, about 32% of the fixed-income portion of
the Trust was leveraged. About 60% of the Trust's leverage is now hedged
for four years.
Q: What were the principal strategies used in managing the equity portion of
the Trust?
A: At the end of the period, about 45% of the portfolio was invested in
equities. We focused on the highest yielding sectors of the market and on
companies with long-term records of dividend payouts. Financials and
utilities (38.3% and 30.5% of equity net assets, respectively) accounted
for the largest sector allocations.
Among equities, utilities were the biggest contributors to performance.
Exelon, which benefited from its exposure to the nuclear industry at a
time when oil prices were rising, made some of the biggest gains. Ameren
also aided results. The company has made a number of opportunistic
acquisitions of smaller utilities, and it
6
Pioneer Tax Advantaged Balanced Trust
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has exposure to coal-fired generation, which may benefit it in the future
as deregulation continues.
Q: What detracted from performance?
A: Financial stocks held back performance, reflecting investor concerns that
rising interest rates would have a negative impact on the earnings of
financial institutions. General Motors also suffered because of a poor
earnings outlook, and telecommunications company SBC Communications
declined.
Q: What is your outlook?
A: Moving into the second half of 2005, we believe economic growth will
continue at a moderate rate. We expect the Fed to continue raising
interest rates at a measured pace and believe inflation will be held in
check. This type of environment should be positive for municipal bonds. On
the equity side, we expect corporate profit growth to be fairly strong,
although less robust than in 2004. While high oil prices remain a factor
in the equity market, we continue to find opportunities in companies that
have long-term records of dividend payouts in the highest yielding areas
of the market.
Any information in this shareholder report regarding market or economic trends
or the factors influencing the Trust's historical or future performance are
statements of the opinion of Trust management as of the date of this report.
These statements should not be relied upon for any other purposes. Past
performance is no guarantee of future results, and there is no guarantee that
market forecasts discussed will be realized.
7
Pioneer Tax Advantaged Balanced Trust
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SCHEDULE OF INVESTMENTS 5/31/05 (unaudited)
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S&P/Moody's
Principal Ratings
Amount (unaudited) Value
TAX EXEMPT OBLIGATIONS - 76.6% of Net Assets
Alabama - 2.9%
$6,990,000 AAA/Aaa Birmingham Waterworks & Sewer
Revenue, 5.0%, 1/1/43 $ 7,275,961
5,000,000 NR/A2 Huntsville Health Care Authority Revenue,
5.75%, 6/1/32 5,377,200
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$ 12,653,161
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Arizona - 3.2%
10,285,000 BB-/Ca Gila County Industrial Development
Authority, 5.55%, 1/1/27 $ 9,535,121
1,000,000 BBB/Baa1 Maricopa County Hospital Revenue,
5.0%, 4/1/35 1,009,220
1,000,000 NR/Baa3 Pima County Industrial Development
Authority, 6.375%, 7/1/31 1,034,020
1,000,000 NR/Baa3 Pima County Industrial Development
Authority, 6.75%, 7/1/31 1,045,970
1,000,000 NR/NR Pima County Industrial Development
Authority, 7.5%, 7/1/34 1,022,260
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$ 13,646,591
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California - 1.5%
1,000,000 A-/Baa1 California Health Facilities Authority
Revenue, 5.25%, 7/1/23 $ 1,056,140
1,000,000 A-/Baa1 California State Public Works Board
Revenue, 5.25%, 6/1/24 1,090,140
4,000,000 BBB/Baa3 Golden State Tobacco Securitization Corp.,
6.75%, 6/1/39 4,366,040
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$ 6,512,320
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Connecticut - 1.6%
4,190,000 BBB-/Baa1 Connecticut State Development Authority
Pollution Control Revenue,
5.85%, 9/1/28 $ 4,459,962
1,000,000 AAA/Aaa Connecticut State Health & Educational
Facilities Authority Revenue,
5.0%, 7/1/21 1,077,080
1,500,000 BB+/NR Mohegan Tribe Indians Gaming Authority,
5.25%, 1/1/33 1,514,475
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$ 7,051,517
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8 The accompanying notes are an integral part of these financial statements.
Pioneer Tax Advantaged Balanced Trust
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S&P/Moody's
Principal Ratings
Amount (unaudited) Value
District of Columbia - 1.0%
$ 4,000,000 BBB/Baa3 District of Columbia Tobacco Settlement
Financing Corp., 6.75%, 5/15/40 $ 4,294,560
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Florida - 1.9%
5,000,000 A/A2 Highlands County Health Facilities
Authority Revenue, 6.0%, 11/15/25 $ 5,503,700
2,025,000 BB+/NR Miami Beach Health Facilities Authority,
5.375%, 11/15/28 2,032,533
500,000 BB+/Ba2 Miami Beach Health Facilities Authority,
6.7%, 11/15/19 548,490
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$ 8,084,723
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Georgia - 2.4%
5,000,000 AAA/Aaa Burke County Development Authority
Revenue, 4.75%, 5/1/34 $ 5,025,950
2,500,000 BBB/NR Milledgeville-Baldwin County Development
Authority Revenue, 5.5%, 9/1/24 2,664,700
2,500,000 BBB/NR Milledgeville-Baldwin County Development
Authority Revenue, 5.625%, 9/1/30 2,653,125
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$ 10,343,775
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Illinois - 5.1%
3,000,000 AAA/Aaa Chicago Illinois General Obiligation,
5.0%, 1/1/28 $ 3,164,730
4,580,000 A-/Baa1 Illinois Development Finance Authority
Revenue, 5.25%, 10/1/24 4,846,327
5,000,000 AA+/Aa1 Illinois Educational Facilities Authority
Revenue, 5.0%, 12/1/38 5,200,050
2,000,000 AA+/Aa2 Illinois Finance Authority Revenue,
5.5%, 8/15/43 2,163,340
5,095,000+ NR/A1 Illinois Health Facilities Authority Revenue,
5.75%, 7/1/15 5,482,984
1,130,000+ CCC/Caa1 Illinois Health Facilities Authority Revenue,
6.375%, 1/1/15 1,132,904
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$ 21,990,335
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Indiana - 2.3%
4,135,000 BBB-/Ba3 Indiana State Development Finance
Authority Revenue, 5.75%, 10/1/11 $ 4,380,619
5,100,000 AAA/Aaa Indiana Transportation Finance Authority
Highway Revenue, 5.0%, 6/1/28 5,378,358
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$ 9,758,977
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The accompanying notes are an integral part of these financial statements. 9
Pioneer Tax Advantaged Balanced Trust
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SCHEDULE OF INVESTMENTS 5/31/05 (unaudited) (continued)
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S&P/Moody's
Principal Ratings
Amount (unaudited) Value
Kansas - 0.8%
$ 3,000,000 AAA/Aaa Wyandotte County Unified Government
Utility System Revenue, 5.65%, 9/1/19 $ 3,501,900
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Louisiana - 1.9%
8,335,000 BBB/Baa3 Tobacco Settlement Financing Corp.,
5.875%, 5/15/39 $ 8,412,265
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Maryland - 0.7%
3,000,000 A/A3 Maryland State Health & Higher
Educational Facilities Authority Revenue,
5.125%, 7/1/34 $ 3,128,430
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Massachusetts - 5.1%
2,000,000 AA+/Aa1 Massachusetts Health & Educational
Facilities Authority Revenue,
5.0%, 7/1/33 $ 2,107,240
1,550,000 BBB-/Baa3 Massachusetts Health & Educational
Facilities Authority Revenue,
5.25%, 7/15/18 1,570,367
1,600,000 BBB/NR Massachusetts Health & Educational
Facilities Authority Revenue,
5.45%, 11/15/23 1,655,600
2,120,000 BBB/Baa3 Massachusetts Health & Educational
Facilities Authority Revenue,
5.625%, 7/1/20 2,176,434
5,000,000 AA-/Aa3 Massachusetts Health & Educational
Facilities Authority Revenue,
5.75%, 7/1/21 5,550,350
900,000 BBB/Baa3 Massachusetts Health & Educational
Facilities Authority Revenue,
6.25%, 7/1/22 980,577
2,750,000 BBB/Baa2 Massachusetts Health & Educational
Facilities Authority Revenue,
6.625%, 7/1/32 3,021,040
500,000 BBB-/NR Massachusetts State Development
Finance Agency, 5.5%, 1/1/35 507,300
1,100,000 BBB/Baa2 Massachusetts State Development
Finance Agency, 5.625%, 10/1/24 1,166,693
1,000,000 BBB/Baa2 Massachusetts State Development
Finance Agency, 5.7%, 10/1/34 1,058,280
10 The accompanying notes are an integral part of these financial statements.
Pioneer Tax Advantaged Balanced Trust
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S&P/Moody's
Principal Ratings
Amount (unaudited) Value
Massachusetts (continued)
$ 2,000,000 AAA/Aaa University of Massachusetts Building
Authority Project Revenue,
5.25%, 11/1/29 $ 2,184,640
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$ 21,978,521
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Michigan - 2.6%
5,000,000 BB/NR Macomb County Hospital Finance Authority
Revenue, 5.875%, 11/15/34 $ 5,044,550
2,000,000 NR/NR Michigan State Hospital Finance Authority
Revenue, 5.25%, 11/15/25 2,018,480
2,000,000 A/A2 Michigan State Hospital Finance Authority
Revenue, 5.5%, 11/1/15 2,192,320
1,000,000 NR/NR Michigan State Hospital Finance Authority
Revenue, 5.5%, 11/15/35 1,018,000
1,025,000 BB/Ba2 Pontiac Hospital Finance Authority
Revenue, 6.0%, 8/1/07 1,024,898
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$ 11,298,248
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Minnesota - 0.9%
2,000,000 A-/NR Duluth Economic Development Authority
Health Care Facilities Revenue,
5.25%, 2/15/28 $ 2,095,180
1,500,000 A-/NR Duluth Economic Development Authority
Health Care Facilities Revenue,
5.25%, 2/15/33 1,567,005
------------
$ 3,662,185
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Missouri - 0.4%
1,720,000 AA/Aa3 Missouri State Health & Educational
Authority Health Facilities Revenue,
5.25%, 8/15/28 $ 1,824,748
------------
Montana - 2.2%
1,350,000 NR/A3 Montana Finance Authority Hospital
Facilities Revenue, 5.0%, 6/1/24 $ 1,386,423
8,000,000(a) AAA/Aaa Montana Health Facility Authority Revenue,
RIB, 7.409%, 2/25/25 8,180,480
------------
$ 9,566,903
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Nebraska - 1.0%
4,000,000(a) AAA/Aaa Nebraska Investment Finance Authority
Revenue, RIB, 8.76%, 3/1/26 $ 4,497,040
------------
The accompanying notes are an integral part of these financial statements. 11
Pioneer Tax Advantaged Balanced Trust
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SCHEDULE OF INVESTMENTS 5/31/05% (unaudited) (continued)
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S&P/Moody's
Principal Ratings
Amount (unaudited) Value
Nevada - 2.2%
$3,000,000 B-/NR Clark County Industrial Development
Revenue, 5.5%, 10/1/30 $ 2,947,440
1,500,000 A-/Baa1 Henderson Nevada Health Care Facilities
Revenue, 5.625%, 7/1/24 1,622,295
5,000,000 BB/Ba2 Washoe County Water Facility Revenue,
5.0%, 3/1/36 5,097,050
------------
$ 9,666,785
------------
New Hampshire - 0.7%
2,000,000 NR/NR New Hampshire Business Finance
Authority Revenue, 6.05%, 9/1/29 $ 1,911,280
1,000,000 A+/A2 New Hampshire Health & Education
Facilities Authority Revenue,
5.75%, 10/1/31 1,075,120
------------
$ 2,986,400
------------
New Jersey - 3.4%
1,250,000 BBB/Baa3 Camden County Improvement Authority
Revenue, 5.75%, 2/15/34 $ 1,332,637
1,500,000 BB/Ba2 New Jersey Health Care Facilities Financing
Authority Revenue, 5.125%, 7/1/14 1,375,515
5,000,000 BBB/Baa1 New Jersey Health Care Facilities Financing
Authority Revenue, 5.375%, 7/1/33 5,229,750
3,500,000 NR/NR New Jersey Health Care Facilities Financing
Authority Revenue, 7.25%, 7/1/27 3,649,800
3,000,000 BBB/Baa3 Tobacco Settlement Financing Corp.,
6.25%, 6/1/43 3,099,000
------------
$ 14,686,702
------------
New Mexico - 0.6%
1,000,000 AA/NR Do-a Ana County PILT Revenue,
5.25%, 12/1/25 $ 1,079,930
1,500,000 NR/A3 Farmington New Mexico Hospital Revenue,
5.0%, 6/1/23 1,551,630
------------
$ 2,631,560
------------
New York - 5.1%
2,000,000 NR/NR Dutchess County Industrial Development
Agency Revenue, 7.5%, 3/1/29 $ 2,093,540
1,000,000 NR/Aa2 New York City Industrial Development
Agency, 5.0%, 7/1/27 1,062,970
12 The accompanying notes are an integral part of these financial statements.
Pioneer Tax Advantaged Balanced Trust
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S&P/Moody's
Principal Ratings
Amount (unaudited) Value
New York (continued)
$ 1,000,000 NR/Aa2 New York City Industrial Development
Agency, 5.25%, 7/1/24 $ 1,095,980
8,820,000(b) AAA/Aa1 New York City Transitional Finance
Authority Revenue, 0.0%, 11/1/29 7,024,072
5,000,000 AA-/A1 Port Authority of New York & New Jersey
Revenue, 5.0%, 9/1/38 5,272,250
4,900,000 AAA/Aaa Triborough Bridge & Tunnel Authority,
5.25%, 11/15/30 5,317,382
------------
$ 21,866,194
------------
North Carolina - 1.4%
3,000,000 AA+/Aa1 North Carolina Capital Facilities Finance
Agency Revenue, 5.125%, 7/1/42 $ 3,147,150
1,000,000 AA/Aa3 North Carolina Capital Facilities Finance
Agency Student Revenue, 5.0%, 6/1/27 1,040,880
1,000,000 AA/Aa3 North Carolina Capital Facilities Finance
Agency Student Revenue, 5.0%, 6/1/32 1,038,620
1,000,000 NR/NR North Carolina Medical Care Commission
Health Care Facilities Revenue,
5.0%, 11/1/23 1,034,120
------------
$ 6,260,770
------------
Ohio - 1.4%
2,000,000 B-/Caa2 Cleveland Airport Special Revenue,
5.7%, 12/1/19 $ 1,601,340
3,000,000 AAA/Aaa Columbus City School District,
5.0%, 12/1/32 3,186,420
1,000,000 AAA/Aaa Hamilton County Hospital Facilities
Revenue, 5.125%, 5/15/28 1,065,360
------------
$ 5,853,120
------------
Oregon - 0.7%
2,935,000 NR/Aaa Oregon State Housing & Community
Services Department Multi-Family
Revenue, 6.0%, 7/1/31 $ 3,045,327
------------
Pennsylvania - 2.8%
5,000,000 AAA/Aaa Pennsylvania State Turnpike Commission
Oil Franchise Tax Revenue,
5.0%, 12/1/31 $ 5,287,150
The accompanying notes are an integral part of these financial statements. 13
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 5/31/05 (unaudited) (continued)
--------------------------------------------------------------------------------
S&P/Moody's
Principal Ratings
Amount (unaudited) Value
Pennsylvania (continued)
$ 3,000,000 A-/NR Sayre Health Care Facilities Authority
Revenue, 5.875%, 12/1/31 $ 3,223,050
280,000 B-/NR Scranton-Lackawanna Health and Welfare
Authority Hospital Revenue,
5.9%, 7/1/08 270,522
700,000 B-/NR Scranton-Lackawanna Health and Welfare
Authority Hospital Revenue,
6.0%, 7/1/09 656,131
460,000 B-/NR Scranton-Lackawanna Health and Welfare
Authority Hospital Revenue,
6.05%, 7/1/10 425,436
2,165,000 AA+/Aa1 Swarthmore Borough Authority College
Revenue, 5.0%, 9/15/31 2,253,657
------------
$ 12,115,946
------------
Puerto Rico - 3.9%
8,000,000 A/Baa2 Puerto Rico Commonwealth Highway &
Transportation Authority Revenue,
5.125%, 7/1/43 $ 8,369,120
5,000,000 BBB/Baa2 Puerto Rico Public Buildings Authority
Revenue, 5.25%, 7/1/33 5,346,100
3,000,000 BBB/Baa3 Puerto Rico Public Finance Corp.,
5.75%, 8/1/27 3,324,930
------------
$ 17,040,150
------------
Rhode Island - 1.1%
1,545,000 BBB/Baa3 Tobacco Settlement Financing Corp.,
6.125%, 6/1/32 $ 1,575,328
3,100,000 BBB/Baa3 Tobacco Settlement Financing Corp.,
6.25%, 6/1/42 3,168,603
------------
$ 4,743,931
------------
South Carolina - 4.1%
6,000,000 A-/A3 Berkeley County School District Installment
Lease, 5.0%, 12/1/28 $ 6,175,800
5,000,000 AAA/Aaa Florence County Hospital Revenue,
5.25%, 11/1/34 5,404,700
3,500,000 A/A2 Lexington County Health Services District,
Inc., Hospital Revenue, 5.5%, 11/1/32 3,702,615
14 The accompanying notes are an integral part of these financial statements.
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
S&P/Moody's
Principal Ratings
Amount (unaudited) Value
South Carolina (continued)
$ 2,500,000 A-/A3 South Carolina Jobs Economic
Development Authority Revenue,
5.5%, 11/15/23 $ 2,650,300
------------
$ 17,933,415
------------
Tennessee - 0.6%
2,500,000 NR/Baa3 Knox County Health Educational & Housing
Facilities Board Hospital Revenue,
6.5%, 4/15/31 $ 2,617,175
------------
Texas - 2.8%
1,551,760 NR/Aaa Houston Housing Financing Corp.,
6.25%, 9/20/31 $ 1,677,142
2,750,000 AAA/Aaa Lower Colorado River Authority,
5.0%, 5/15/31 2,864,620
1,711,000 NR/Aaa Panhandle Regional Housing Finance
Corp., 6.6%, 7/20/31 1,887,866
3,000,000 BBB/Baa2 Richardson Hospital Authority,
6.0%, 12/1/34 3,237,570
1,000,000 BBB-/NR Seguin Higher Education Facilities Corp.
Revenue, 5.0%, 9/1/23 1,003,600
1,500,000 NR/Baa3 Texas State Student Housing Revenue,
6.5%, 9/1/34 1,586,730
------------
$ 12,257,528
------------
Vermont - 0.3%
1,295,000 AA/Aa3 Vermont Educational & Health Buildings
Financing Agency Revenue,
5.0%, 7/1/24 $ 1,364,516
------------
Virginia - 1.3%
1,500,000 NR/A3 Prince William County Industrial
Development Hospital Revenue,
5.2%, 10/1/26 $ 1,583,115
3,925,000 NR/A3 Prince William County Industrial
Development Hospital Revenue,
5.35%, 10/1/36 4,157,085
------------
$ 5,740,200
------------
Washington - 4.4%
8,000,000 AAA/Aaa King County Washington Sewer Revenue,
5.0%, 1/1/35 $ 8,378,720
The accompanying notes are an integral part of these financial statements. 15
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 5/31/05 (unaudited) (continued)
--------------------------------------------------------------------------------
S&P/Moody's
Principal Ratings
Amount (unaudited) Value
Washington (continued)
$ 3,000,000 AAA/Aaa Spokane County General Obligation,
5.0%, 12/1/33 $ 3,140,880
7,000,000 BBB/Baa3 Tobacco Settlement Authority Revenue,
6.625%, 6/1/32 7,379,190
------------
$ 18,898,790
------------
West Virginia - 0.6%
2,500,000 A-/NR Monongalia County Building Commission
Hospital Revenue, 5.25%, 7/1/35 $ 2,574,075
------------
Wisconsin - 1.7%
3,650,000 BB/Baa3 Janesville Pollution Control Revenue,
5.55%, 4/1/09 $ 3,578,424
3,500,000 BBB+/NR Wisconsin State Health & Educational
Facilities Authority Revenue,
5.6%, 2/15/29 3,620,120
------------
$ 7,198,544
------------
TOTAL TAX-EXEMPT OBLIGATIONS
(Cost $312,190,765) (c) $331,687,327
------------
16 The accompanying notes are an integral part of these financial statements.
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Shares Value
COMMON STOCKS - 37.0% of Net Assets
Energy - 1.1%
Oil & Gas - 1.1%
50,000 ChevronTexaco Corp. $ 2,689,000
29,861 Kerr-McGee Corp. 2,205,533
------------
Total Energy $ 4,894,533
------------
Materials - 2.9%
Chemicals - 2.6%
83,000 Eastman Chemical Co. $ 4,878,740
96,022 Lyondell Chemical Co. 2,279,562
61,128 PPG Industries, Inc. 3,997,160
------------
$ 11,155,462
------------
Construction Materials - 0.0%
3,950 Monarch Cement Co. $ 88,875
------------
Metals & Mining - 0.3%
39,800 Freeport-McMoRan Copper & Gold, Inc. $ 1,404,940
200 Worthington Industries, Inc. 3,352
------------
$ 1,408,292
------------
Total Materials $ 12,652,629
------------
Industrials - 0.3%
Commercial Services & Supplies - 0.3%
39,600 R.R. Donnelley & Sons Co. $ 1,316,700
------------
Total Industrials $ 1,316,700
------------
Capital Goods - 2.5%
Automobiles - 0.6%
80,000 General Motors Corp. $ 2,522,400
------------
Diversified Consumer Services - 0.6%
200,227 ServiceMaster Co. $ 2,602,951
------------
Household Durables - 1.3%
50,000 Bassett Furniture Industries, Inc. $ 976,500
48,386 Kimball International, Inc. 595,148
33,700 Knape & Vogt Manufacturing Co. 379,125
166,444 Tupperware Corp. 3,761,634
------------
$ 5,712,407
------------
Total Capital Goods $ 10,837,758
------------
The accompanying notes are an integral part of these financial statements. 17
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 5/31/05 (unaudited) (continued)
--------------------------------------------------------------------------------
Shares Value
Consumer Staples - 3.7%
Food & Staples Retailing - 0.5%
140,947 Lance, Inc. $ 2,491,943
------------
Tobacco - 3.2%
76,000 Altria Group, Inc. $ 5,102,640
115,000 Loews Corp. - Carolina Group 3,436,200
33,000 Reynolds American, Inc. 2,736,030
56,000 UST, Inc. 2,495,360
------------
$ 13,770,230
------------
Total Consumer Staples $ 16,262,173
------------
Health Care - 3.3%
Pharmaceuticals - 3.3%
281,215 Bristol-Myers Squibb Co. $ 7,131,612
216,536 Merck & Co., Inc. 7,024,428
------------
Total Health Care $ 14,156,040
------------
Financials - 3.8%
Commercial Banks - 3.3%
78,200 FirstMerit Corp. $ 1,994,100
81,550 KeyCorp 2,671,578
90,000 National City Corp. 3,110,400
67,800 Regions Financial Corp. 2,283,504
222,700 TrustCo Bank Corp., NY 2,772,615
28,642 Wachovia Corp. 1,453,582
------------
$ 14,285,779
------------
Thrifts & Mortgage Finance - 0.5%
50,000 Washington Mutual, Inc. $ 2,065,000
------------
Total Financials $ 16,350,779
------------
Telecommunication Services - 4.4%
Diversified Telecommunication Services - 4.4%
53,130 ALLTEL Corp. $ 3,090,572
257,900 AT&T Corp. 4,845,941
182,750 BellSouth Corp. 4,890,390
260,000 SBC Communications, Inc. 6,078,800
------------
Total Telecommunication Services $ 18,905,703
------------
18 The accompanying notes are an integral part of these financial statements.
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Shares Value
Utilities - 15.0%
Electric Utilities - 10.4%
137,135 Ameren Corp. $ 7,484,828
200,000 Consolidated Edison, Inc. 9,102,000
138,400 Empire District Electric Co. 3,180,432
229,293 Exelon Corp. 10,742,377
74,383 Great Plains Energy, Inc. 2,343,065
67,056 NSTAR 3,925,458
64,000 PG&E Corp. 2,289,280
179,000 Southern Co. 6,077,050
------------
$ 45,144,490
------------
Gas Utilities - 2.7%
172,185 Atmos Energy Corp. $ 4,871,114
167,249 KeySpan Corp. 6,646,475
------------
$ 11,517,589
------------
Multi-Utilities - 1.9%
303,253 Duke Energy Corp. $ 8,333,392
------------
Total Utilities $ 64,995,471
------------
TOTAL COMMON STOCKS
(Cost $149,877,469) $160,371,786
------------
NON-CONVERTIBLE PREFERRED STOCKS - 24.8% of Net Assets
Energy - 1.1%
Oil & Gas - 1.1%
49,300 Apache Corp., Series B, 5.68% $ 5,093,306
------------
Total Energy $ 5,093,306
------------
Financials - 19.7%
Capital Markets - 3.2%
57,000 Bear Stearns Companies, Inc., Series F, 5.72% $ 2,909,850
40,000 Bear Stearns Companies, Inc., Series G, 5.49% 2,016,000
100,000 Lehman Brothers Holdings, Inc., 6.5% 2,598,000
19,000 Lehman Brothers Holdings, Inc., Series C, 5.94% 961,400
30,000 Lehman Brothers Holdings, Inc., Series D, 5.67% 1,485,000
65,000 Merrill Lynch Preferred Capital Trust IV, 7.12% 1,710,186
87,000 Merrill Lynch Preferred Capital Trust V, 7.28% 2,306,644
------------
$ 13,987,080
------------
The accompanying notes are an integral part of these financial statements. 19
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 5/31/05 (unaudited) (continued)
--------------------------------------------------------------------------------
Shares Value
Commercial Banks - 3.7%
94,000 Bank of America Corp., Series VI, 6.75% $ 5,240,500
30,000 Bank One Capital V, 8.0% 768,092
105,000 Bank One Capital VI, 7.2% 2,698,246
27,000 Fleet Capital Trust VII, 7.2% 696,292
200,000 Royal Bank of Scotland Group Plc, Series L, 5.75% 4,870,000
55,000 Wachovia Preferred Funding Corp., Series A, 7.25% 1,587,850
------------
$ 15,860,980
------------
Consumer Finance - 0.8%
18,000 MBNA Capital, Series D, 8.125% $ 466,170
50,000 SLM Holding Corp., Series A, 6.97% 2,867,500
------------
$ 3,333,670
------------
Diversified Financial Services - 1.7%
55,000 Citigroup Inc., Series G, 6.213% $ 2,934,250
81,500 Citigroup Inc., Series M, 5.864% 4,258,375
------------
$ 7,192,625
------------
Insurance - 2.1%
110,000 ACE Ltd., Series C, 7.8% $ 2,919,400
70,000 RenaissanceRe Holdings, Ltd., Series C, 6.08% 1,652,700
70,000 St. Paul Capital Trust I, 7.6% 1,805,588
109,000 XL Capital, Ltd., Series B, 7.625% 2,904,850
------------
$ 9,282,538
------------
Real Estate - 2.2%
27,000 Equity Office Properties Trust, Series G, 7.75% $ 723,600
92,000 Home Properties New York, Inc., Series F, 9.0% 2,520,800
40,000 Prologis Trust, Series G, 6.75% 1,013,200
60,000 PS Business Parks, Inc., Series H, 7.0% 1,482,000
22,000 PS Business Parks, Inc., Series I, 6.875% 537,900
35,480 Public Storage, Inc., Series T, 7.625% 927,092
94,000 Regency Centers Corp., Series C, 7.45% 2,411,100
------------
$ 9,615,692
------------
20 The accompanying notes are an integral part of these financial statements.
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Shares Value
Thrifts & Mortgage Finance - 6.0%
12,000 Countrywide Capital IV, 6.75% $ 308,013
201,000 Fannie Mae, Series L, 5.125% 8,904,300
114,000 Fannie Mae, Series M, 4.75% 4,605,600
100,000 Fannie Mae, Series N, 5.5% 4,750,000
57,000 Freddie Mac, 5.81% 2,850,000
39,000 Freddie Mac, Series F, 5.0% 1,667,250
58,000 Freddie Mac, Series K, 5.79% 2,943,500
------------
$ 26,028,663
------------
Total Financials $ 85,301,248
------------
Utilities - 4.0%
Electric Utilities - 3.6%
98,000 Alabama Power Co., 5.3% $ 2,517,375
113,000 Alabama Power Co., 5.83% 2,836,300
80,000 Energy East Capital Trust I, 8.25% 2,071,778
78,000 Interstate Power and Light Co., Series B, 8.375% 2,613,000
40,000 Mississippi Power Co., 5.25% 1,008,752
7,700 PPL Electric Utilities Corp., 4.5% 635,250
72,000 Southern California Edison Co., 4.32% 1,422,000
94,000 Virginia Power Capital Trust II, 7.375% 2,457,881
------------
$ 15,562,336
------------
Gas Utilities - 0.4%
62,000 Southern Union Co., Series C, 7.55% $ 1,670,900
------------
Total Utilities $ 17,233,236
------------
TOTAL NON-CONVERTIBLE PREFERRED STOCKS
(Cost $109,210,983) $107,627,790
------------
CONVERTIBLE PREFERRED STOCKS - 0.6% of Net Assets
Industrials - 0.4%
Aerospace & Defense - 0.4%
15,000 Northrop Grumman Corp., 7.0% $ 1,886,250
------------
Total Industrials $ 1,886,250
------------
Utilities - 0.2%
Electric Utilities - 0.2%
31,000 DTE Energy Co., 8.75% $ 770,350
------------
Total Utilities $ 770,350
------------
TOTAL CONVERTIBLE PREFERRED STOCKS
(Cost $2,750,800) $ 2,656,600
------------
The accompanying notes are an integral part of these financial statements. 21
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 5/31/05 (unaudited) (continued)
--------------------------------------------------------------------------------
Shares Value
TAX-EXEMPT MONEY MARKET MUTUAL FUND - 1.2% of Net Assets
5,105,102 BlackRock Provident Institutional Municipal Fund $ 5,105,102
-------------
TOTAL TAX-EXEMPT MONEY MARKET MUTUAL FUND
(Cost $5,105,102) $ 5,105,102
-------------
TOTAL INVESTMENTS IN SECURITIES - 140.2%
(Cost $579,135,119) (d) $ 607,448,605
-------------
OTHER ASSETS AND LIABILITIES - 0.5% $ 2,208,568
-------------
PREFERRED SHARES AT REDEMPTION VALUE,
INCLUDING
DIVIDENDS PAYABLE - (40.7)% $(176,285,297)
-------------
NET ASSETS APPLICABLE TO COMMON
SHAREOWNERS - 100.0% $ 433,371,876
===== =============
NR Security not rated by S&P or Moody's.
+ Prefunded bonds have been collateralized by U.S. Treasury securities which
are held in escrow to pay interest and principal on the tax exempt issue
and to retire the bonds in full at the earliest refunding date.
(a) The interest rate is subject to change periodically and inversely based
upon prevailing market rates. The interest rate shown was the rate at May
31, 2005.
(b) Indicates a security that has a zero coupon that remains in effect until a
predetermined date at which time the stated coupon rate becomes effective
until final maturity.
(c) The concentration of tax-exempt investments by type of obligation/market
sector is as follows:
Insured 22.8%
Revenue Bonds:
Health Revenue 31.1
Development Revenue 10.1
Tobacco Revenue 9.6
Education Revenue 5.5
Other 5.0
Transportation Revenue 4.0
Housing Revenue 3.3
Pollution Revenue 2.4
School District Revenue 1.8
Facilities Revenue 1.6
Water Revenue 1.5
Airport Revenue 0.5
Gaming Revenue 0.5
Utilities Revenue 0.3
----
100.0%
-----
22 The accompanying notes are an integral part of these financial statements.
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(d) At May 31, 2005, the net unrealized gain on investments based on cost for
federal income tax purposes of $579,010,130 was as follows:
Aggregate gross unrealized gain for all investments in which there
is an excess of value over tax cost $36,393,661
Aggregate gross unrealized loss for all investments in which there
is an excess of tax cost over value (7,955,186)
-----------
Net unrealized gain $28,438,475
============
For financial reporting purposes net unrealized gain on investments
was $28,313,486 and cost of investments aggregated $579,135,119.
Portfolio Abbreviations
RIB Residual Interest Bonds
Purchases and sales of securities (excluding temporary cash investments) for
the six months ended May 31, 2005, aggregated $87,427,570 and $89,894,990,
respectively.
The accompanying notes are an integral part of these financial statements. 23
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES 5/31/05 (unaudited)
--------------------------------------------------------------------------------
ASSETS:
Investments in securities, at value (cost $579,135,119) $607,448,605
Cash 850
Receivables -
Investment securities sold 3,158,300
Dividends and interest 6,333,297
Unrealized appreciation on interest rate swaps 792,336
Prepaid expenses 9,488
------------
Total assets $617,742,876
------------
LIABILITIES:
Payables -
Investment securities purchased $ 7,657,927
Due to affiliate 309,608
Administration fee payable 32,454
Accrued expenses 85,714
------------
Total liabilities $ 8,085,703
------------
PREFERRED SHARES AT REDEMPTION VALUE:
$25,000 liquidation value per share applicable to 7,050
shares, including dividends payable of $35,297 $176,285,297
------------
NET ASSETS APPLICABLE TO COMMON SHAREOWNERS:
Paid-in capital $408,360,057
Distributions in excess of net investment income (140,798)
Accumulated net realized loss on investments and interest
rate swaps (3,953,205)
Net unrealized gain on investments 28,313,486
Net unrealized gain on interest rate swaps 792,336
------------
Net assets applicable to common shareowners $433,371,876
============
NET ASSET VALUE PER SHARE:
No par value, (unlimited number of shares authorized)
Based on $433,371,876/28,706,981 common shares $ 15.10
============
24 The accompanying notes are an integral part of these financial statements.
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
STATEMENT OF OPERATIONS (unaudited)
--------------------------------------------------------------------------------
For the Six Months Ended 5/31/05
INVESTMENT INCOME:
Dividends $ 6,636,834
Interest 8,889,728
-----------
$15,526,562
-----------
EXPENSES:
Management fees $ 1,805,569
Administration fees and reimbursements 206,719
Transfer agent fees and expenses 26,922
Auction agent fees 232,615
Custodian fees 7,855
Registration fees 17,171
Professional fees 45,301
Printing expense 11,945
Trustees' fees 6,141
Miscellaneous 20,551
-----------
Total expenses $ 2,380,789
-----------
Net investment income $13,145,773
-----------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS AND INTEREST RATE SWAPS:
Net realized gain (loss) from:
Investments $ 3,284,471
Interest rate swaps (407,151) $ 2,877,320
----------- -----------
Change in net unrealized gain from:
Investments $13,888,941
Interest rate swaps (170,780) $13,718,161
----------- -----------
Net gain on investments and interest rate swaps $16,595,481
-----------
DISTRIBUTIONS TO PREFERRED SHAREOWNERS FROM
NET INVESTMENT INCOME $(2,325,630)
-----------
Net increase in net assets applicable to common
shareowners resulting from operations $27,415,624
===========
The accompanying notes are an integral part of these financial statements. 25
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
--------------------------------------------------------------------------------
For the Six Months Ended 5/31/05 and the Period from 1/28/04
(Commencement of Operations) to 11/30/04
Six Months
Ended 1/28/04
5/31/05 to
(unaudited) 11/30/04
FROM OPERATIONS:
Net investment income $ 13,145,773 $ 18,780,875
Net realized gain (loss) on investments and interest
rate swaps 2,877,320 (7,159,776)
Net unrealized gain on investments and interest
rate swaps 13,718,161 15,387,661
Distributions to preferred shareowners from net
investment income (2,325,630) (1,802,192)
------------- -------------
Net increase in net assets applicable to
common shareowners $ 27,415,624 $ 25,206,568
------------- -------------
DISTRIBUTIONS TO COMMON SHAREOWNERS:
Net investment income ($0.41 and $0.55 per
share, respectively) $ (11,833,017) $ (15,777,356)
------------- -------------
Total dividends to common shareowners $ (11,833,017) $ (15,777,356)
------------- -------------
FROM TRUST SHARE TRANSACTIONS:
Net proceeds from the issuance of common shares $ - $ 366,720,000
Net proceeds from underwriters' over-allotment
option exercised - 44,407,500
Common share offering expenses charged to
paid-in capital - (851,752)
Preferred share offering expenses charged to
paid-in capital - (2,015,694)
------------- -------------
Net increase in net assets applicable to
common shareowners resulting from Trust
share transactions $ - $ 408,260,054
------------- -------------
Net increase in net assets applicable to
common shareowners $ 15,582,607 $ 417,689,266
NET ASSETS APPLICABLE TO COMMON
SHAREOWNERS:
Beginning of period 417,789,269 100,003
------------- -------------
End of period (including distributions in excess
of net investment income and undistributed net
investment income of ($140,798) and
$872,076, respectively) $ 433,371,876 $ 417,789,269
============= =============
26 The accompanying notes are an integral part of these financial statements.
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS 5/31/05
--------------------------------------------------------------------------------
Six Months
Ended 1/28/04(b)
5/31/05 to
(unaudited) 11/30/04
Per Common Share Operating Performance
Net asset value, beginning of period $ 14.55 $ 14.33(c)
--------- ---------
Increase (decrease) from investment operations:(a)
Net investment income $ 0.46 $ 0.66
Net realized and unrealized gain on investments and
interest rate swaps 0.58 0.27
Distributions to preferred shareowners from net
investment income (0.08) (0.06)
--------- ---------
Net increase from investment operations $ 0.96 $ 0.87
Distributions to common shareowners:
Net investment income (0.41) (0.55)
Capital charge with respect to issuance of:
Common shares - (0.03)
Preferred shares - (0.07)
--------- ---------
Net increase in net asset value $ 0.55 $ 0.22
--------- ---------
Net asset value, end of period(d) $ 15.10 $ 14.55
--------- ---------
Market value, end of period(d) $ 13.20 $ 12.74
--------- ---------
Total return(e) 6.90% (11.26)%
Ratios to average net assets of common shareowners
Net expenses(f) 1.12%(g) 1.04%(g)
Net investment income before preferred share dividends(f) 6.17%(g) 5.69%(g)
Preferred share dividends 1.09%(g) 0.55%(g)
Net investment income available to common shareowners 5.08%(g) 5.14%(g)
Portfolio turnover 15% 63%
Net assets of common shareowners, end of period (in thousands) $433,372 $417,789
Preferred shares outstanding (in thousands) $176,250 $176,250
Asset coverage per preferred share, end of period $ 86,476 $ 84,264
Average market value per preferred share $ 25,000 $ 25,000
Liquidation value, including dividends payable, per preferred share $ 25,005 $ 25,003
Ratios to average net assets of common shareowners before
reimbursement of organization expenses
Net expenses(f) 1.12%(g) 1.05%(g)
Net investment income before preferred share dividends(f) 6.17%(g) 5.68%(g)
Preferred share dividends 1.09%(g) 0.55%(g)
Net investment income available to common shareowners 5.08%(g) 5.13%(g)
(a) The per common share data presented above is based upon the average common
shares outstanding for the periods presented.
(b) Trust shares were first publicly offered on January 28, 2004.
(c) Net asset value immediately after the closing of the first public offering
was $14.30.
(d) Net asset value and market value are published in Barron's on Saturday, The
Wall Street Journal on Monday and The New York Times on Monday and Saturday.
(e) Total investment return is calculated assuming a purchase of common shares
at the current market value on the first day and a sale at the current
market value on the last day of the periods reported. Dividends and
distributions, if any, are assumed for purposes of this calculation to be
reinvested at prices obtained under the Trust's dividend reinvestment plan.
Total investment return does not reflect brokerage commissions. Total
investment return less than a full period is not annualized. Past
performance is not a guarantee of future results.
(f) Ratios do not reflect the effect of dividend payments to preferred
shareowners.
(g) Annualized.
The information above represents the operating performance data for a share of
common stock outstanding, total investment return, ratios to average net assets
of common shareowners and other supplemental data for the periods indicated.
This information has been determined based upon financial information provided
in the financial statements and market value data for the Trust's common
shares.
The accompanying notes are an integral part of these financial statements. 27
Pioneer Tax Advantaged Balanced Trust
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 5/31/05 (unaudited)
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1. Organization and Significant Accounting Policies
Pioneer Tax Advantaged Balanced Trust (the "Trust") was organized as a Delaware
business trust on October 16, 2003. Prior to commencing operations on January
28, 2004, the Trust had no operations other than matters relating to its
organization and registration as a diversified, closed-end management
investment company under the Investment Company Act of 1940, as amended, and
the sale and issuance to Pioneer Funds Distributor, Inc., an affiliate of
Pioneer Investment Management, Inc. ("PIM"), the Trust's investment adviser, a
wholly owned indirect subsidiary of UniCredito Italiano S.p.A. (UniCredito
Italiano), of 6,981 shares of beneficial interest at an aggregate purchase
price of $100,003. The investment objective of the Trust is to provide a high
level of total after-tax return, including attractive tax-advantaged income.
The Trust may invest in municipal securities with a broad range of maturities
and credit ratings, including both investment grade and below investment grade
municipal securities. The Trust may also invest in common stocks and preferred
securities that pay tax-qualified dividends. In addition, the Trust may invest
in other securities, including debt instruments, real estate investment trusts
("REITS") and equity securities, that generate income taxable at ordinary
income rates, rather than long-term capital gain rates.
The Trust invests in below investment grade (high-yield) debt securities. Debt
securities rated below investment grade are commonly referred to as "junk
bonds" and are considered speculative. These securities involve greater risk of
loss, are subject to greater price volatility, and are less liquid, especially
during periods of economic uncertainty or change, than higher rated debt
securities.
The Trust's financial statements have been prepared in conformity with U.S.
generally accepted accounting principles that require the management of the
Trust to, among other things, make estimates and assumptions that affect the
reported amounts of assets and liabilities, the disclosure of contingent assets
and liabilities at the date of the financial statements, and the reported
amounts of income, expenses and gains and losses on investments during the
reporting period. Actual results could differ from those estimates. The
following is a summary of significant accounting policies followed by the Trust
in preparation of its financial statements, which are consistent with those
policies generally accepted in the investment company industry:
28
Pioneer Tax Advantaged Balanced Trust
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A. Security Valuation
Security transactions are recorded as of trade date. Debt securities are
valued at prices supplied by independent pricing services, which consider
such factors as Treasury spreads, yields, maturities and ratings.
Valuations may be supplemented by dealers and other sources, as required.
Equity securities are valued at the last sale price on the principal
exchange where they are traded. The values of interest rate swaps are
determined by obtaining dealer quotations. Securities for which market
quotations are not readily available are valued at their fair values as
determined by, or under the direction of, the Board of Trustees. The Trust
may also use the fair value of a security, including a non U.S. security,
when the closing market price on the principal exchange where the security
is traded no longer accurately reflects the value of the security as of
the close of the exchange. As of May 31, 2005, there were no securities
fair valued. Temporary cash investments are valued at amortized cost.
Dividend income is recorded on the ex-dividend date, except that certain
dividends from foreign securities where the ex-dividend date may have
passed are recorded as soon as the Trust becomes aware of the ex-dividend
data in the exercise of reasonable diligence. Discount and premium on debt
securities are accreted or amortized daily, respectively, on an effective
yield to maturity basis and are included in interest income. Interest
income, including income on interest bearing cash accounts, is recorded on
an accrual basis.
Gains and losses on sales of investments are calculated on the identified
cost method for both financial reporting and federal income tax purposes.
B. Federal Income Taxes
It is the Trust's policy to comply with the requirements of the Internal
Revenue Code applicable to regulated investment companies and to
distribute all of its taxable income and net realized capital gains, if
any, to its shareowners. Therefore, no federal income tax provision is
required.
The amounts and characterizations of distributions to shareowners for
financial reporting purposes are determined in accordance with federal
income tax rules. Therefore, the source of the Trust's
29
Pioneer Tax Advantaged Balanced Trust
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NOTES TO FINANCIAL STATEMENTS 5/31/05 (unaudited) (continued)
--------------------------------------------------------------------------------
distributions may be shown in the accompanying financial statements as
either from or in excess of net investment income or net realized gain on
investment transactions, or from paid-in capital, depending on the type of
book/tax differences that may exist.
At November 30, 2004, the Trust had a capital loss carryforward of
$6,830,525 which will expire in 2012 if not utilized.
The tax character of current year distributions paid will be determined at
the end of the current fiscal year. The tax character of distributions
paid to common and preferred shareowners during the period ended November
30, 2004 was as follows:
--------------------------------------------------------------------------------
2004
--------------------------------------------------------------------------------
Distributions paid from:
Tax-Exempt income $ 9,413,848
Ordinary income 8,165,700
Long-term capital gain -
-----------
$17,579,548
===========
--------------------------------------------------------------------------------
The following shows the components of distributable earnings on a federal
income tax basis at November 30, 2004.
2004
--------------------------------------------------------------------------------
Undistributed tax-exempt income $ 475,326
Undistributed ordinary income 412,584
Capital loss carryforward (6,830,525)
Unrealized appreciation 15,371,827
----------
Total $9,429,212
==========
--------------------------------------------------------------------------------
The difference between book basis and tax basis unrealized appreciation is
primarily attributable to the difference between book and tax amortization
methods for premiums and discounts on fixed income securities.
C. Automatic Dividend Reinvestment Plan
All common shareowners automatically participate in the Automatic Dividend
Reinvestment Plan (the "Plan"), under which participants receive all
dividends and capital gain distributions (collectively, "dividends") in
full and fractional common shares of the Trust in
30
Pioneer Tax Advantaged Balanced Trust
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lieu of cash. Shareowners may elect not to participate in the Plan.
Shareowners not participating in the Plan receive all dividends and
capital gain distributions in cash. Participation in the Plan is
completely voluntary and may be terminated or resumed at any time without
penalty by notifying Mellon Investor Services LLC, the agent for
shareowners in administering the Plan (the "Plan Agent"), in writing prior
to any dividend record date; otherwise such termination or resumption will
be effective with respect to any subsequently declared dividend or other
distribution. Whenever the Trust declares a dividend on common shares
payable in cash, participants in the Plan will receive the equivalent in
common shares acquired by the Plan Agent either (i) through receipt of
additional unissued but authorized common shares from the Trust or (ii) by
purchase of outstanding common shares on the New York Stock Exchange or
elsewhere. If, on the payment date for any dividend, the net asset value
per common share is equal to or less than the market price per share plus
estimated brokerage trading fees ("market premium"), the Plan Agent will
invest the dividend amount in newly issued common shares. The number of
newly issued common shares to be credited to each account will be
determined by dividing the dollar amount of the dividend by the net asset
value per common share on the date the shares are issued, provided that
the maximum discount from the then current market price per share on the
date of issuance does not exceed 5%. If, on the payment date for any
dividend, the net asset value per common share is greater than the market
value ("market discount"), the Plan Agent will invest the dividend amount
in common shares acquired in open-market purchases. There are no brokerage
charges with respect to newly issued common shares. However, each
participant will pay a pro rata share of brokerage trading fees incurred
with respect to the Plan Agent's open-market purchases. Participating in
the Plan does not relieve shareowners from any federal, state or local
taxes which may be due on dividends paid in any taxable year. Shareowners
holding Plan shares in a brokerage account may not be able to transfer the
shares to another broker and continue to participate in the Plan.
2. Management Agreement
PIM manages the Trust's portfolio. Management fees are calculated daily at the
annual rate of 0.60% of the Trust's average daily managed assets. "Managed
assets" is the average daily value of the
31
Pioneer Tax Advantaged Balanced Trust
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NOTES TO FINANCIAL STATEMENTS 5/31/05 (unaudited) (continued)
--------------------------------------------------------------------------------
Trust's total assets minus the sum of the Trust's liabilities, which
liabilities exclude debt related to leverage, short-term debt and the aggregate
liquidation preference of any outstanding preferred shares. At May 31, 2005,
$309,608 was payable to PIM related to management fees.
In addition, under PIM's management and administration agreements, certain
other services and costs are paid by PIM and reimbursed by the Trust. For the
six months ended, the Trust recorded $16,715 in reimbursements and is included
in "Administration fees and reimbursement" on the Statement of Operations.
The Trust has retained Princeton Administrators, L.P., ("Princeton") an
affiliate of Merrill Lynch, Pierce, Fenner & Smith Incorporated, to provide
certain administrative services to the Trust on its behalf. The Trust pays
Princeton a monthly fee at an annual rate of 0.07% of the average daily value
of the Trust's managed assets up to $500 million and 0.03% for average daily
managed assets in excess of $500 million, subject to a minimum monthly fee of
$10,000.
Also, PIM has agreed for the first three years of the Trust's investment
operations to limit the Trust's total annual expenses [excluding offering costs
for common and preferred shares, interest expense, the cost of defending or
prosecuting any claim or litigation to which the Trust is a party (together
with any amount in judgment or settlement), indemnification expenses or taxes
incurred due to the failure of the Trust to qualify as a regulated investment
company under the Code or any other non-recurring or non-operating expenses] to
0.80% of the Trust's average daily managed assets. The dividend on any
preferred shares is not an expense for this purpose. For the six months ended,
May 31, 2005, the Trust's expenses were not reduced under such arrangements.
3. Transfer Agents
Pioneer Investment Management Shareholder Services, Inc. ("PIMSS"), a wholly
owned indirect subsidiary of UniCredito Italiano, through a sub-transfer agency
agreement with Mellon Investor Services LLC, provides substantially all
transfer agent and shareowner services related to the Trust's common shares at
negotiated rates. Deutsche Bank Trust Company Americas is the transfer agent,
registrar, dividend paying agent and redemption agent with respect to the
Trust's Auction Market Preferred Shares ("AMPS"). The Trust pays
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Pioneer Tax Advantaged Balanced Trust
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Deutsche Bank Trust Company Americas an annual fee, as is agreed to from time
to time by the Trust and Deutsche Bank Trust Company Americas, for providing
such services.
4. Interest Rate Swaps
The Trust may enter into interest rate swap transactions to attempt to protect
itself from increasing dividend or interest expense on its leverage resulting
from increasing short-term interest rates. The cost of leverage may rise with
an increase in interest rates, generally having the effect of lower yields and
potentially lower dividends to common shareowners. Interest rate swaps can be
used to "lock in" the cost of leverage and reduce the negative impact that
rising short-term interest rates would have on the Trust's leveraging costs.
An interest rate swap is an agreement between two parties, which involves
exchanging a floating rate and fixed rate interest payments for a specified
period of time. Interest rate swaps involve the accrual of the net interest
payments between the parties on a daily basis, with the net amount recorded
within the unrealized appreciation/ depreciation of interest rate swaps on the
Statement of Assets and Liabilities. Once the interim payments are settled in
cash, at the pre-determined dates specified in the agreement, the net amount is
recorded as realized gain or loss from interest rate swaps on the Statement of
Operations. During the term of the swap, changes in the value of the swap are
recognized as unrealized gains and losses by "marking-to market" the market
value of the swap based on values obtained from dealer quotations. When the swap
is terminated, the Trust will record a realized gain or loss equal to the
difference, if any, between the proceeds from (or cost of) closing the contract
and the cost basis of the contract. The Trust is exposed to credit risk in the
event of non-performance by the other party to the interest rate swap. However,
at May 31, 2005 the Trust does not anticipate non-performance by any
counterparty. Risk may also arise with regard to market movements in the value
of the swap arrangement that do not exactly offset the changes in the related
dividend requirement or interest expense on the Trust's leverage.
Under the terms of the agreement entered into by the Trust, the Trust receives
a floating rate of interest and pays a fixed rate of interest for the term.
Details of the swap agreement outstanding as of May 31, 2005 were as follows:
33
Pioneer Tax Advantaged Balanced Trust
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NOTES TO FINANCIAL STATEMENTS 5/31/05 (unaudited) (continued)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------------
Termination Notional Fixed Unrealized
Counterparty Date Amount (000) Rate Floating Rate Appreciation
------------- ----------- ------------ ------ ------------- ------------
UBS AG Sept. 1, 2009 $106,000 2.855% 1 month BMA $792,336
--------------------------------------------------------------------------------------
5. Trust Shares
There are an unlimited number of common shares of beneficial interest
authorized. Of the 28,706,981 common shares of beneficial interest outstanding
at May 31, 2005, PIM owned 6,981 shares.
Transactions in common shares of beneficial interest for the six months ended
May 31, 2005 and the period from January 28, 2004 (commencement of operations)
to November 30, 2004 were as follows:
--------------------------------------------------------------------------------
2005 2004
--------------------------------------------------------------------------------
Shares issued in connection with
initial public offering - 25,600,000
Shares issued from underwriters'
over-allotment option exercised - 3,100,000
---------- ----------
Net increase in shares outstanding - 28,700,000
Shares outstanding at beginning
of period 28,706,981 6,981
---------- ----------
Shares outstanding at end of period 28,706,981 28,706,981
========== ==========
The Trust may classify or reclassify any unissued common shares of beneficial
interest into one or more series of preferred shares of beneficial interest. As
of May 31, 2005, there were 7,050 AMPS as follows: Series T7-2,350, Series
F7-2,350 and Series TH28-2,350.
Dividends on Series T7 and Series F7 are cumulative at a rate which is reset
every seven days based on the results of an auction. Dividends on Series TH28
are also cumulative at a rate reset every 28 days based on the results of an
auction. Dividend rates ranged from 2.05% to 3.36% during the six months ended
May 31, 2005.
The Trust may not declare dividends or make other distributions on its common
shares or purchase any such shares if, at the time of the declaration,
distribution or purchase, asset coverage with respect to the outstanding
preferred shares would be less than 200%.
The AMPS are redeemable at the option of the Trust, in whole or in part, on any
dividend payment date at $25,000 per share plus any accumulated or unpaid
dividends, whether or not declared. The AMPS
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Pioneer Tax Advantaged Balanced Trust
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are also subject to mandatory redemption at $25,000 per share plus any
accumulated or unpaid dividends, whether or not declared, if certain
requirements relating to the composition of the assets and liabilities of the
Trust as set forth in the Agreement and Declaration of Trust are not satisfied.
The holders of AMPS have voting rights equal to the holders of the Trust's
common shares (one vote per share) and will vote together with holders of the
common shares as a single class. However, holders of AMPS are also entitled to
elect two of the Trust's Trustees. In addition, the Investment Company Act of
1940, as amended, requires that along with approval by shareowners that might
otherwise be required, the approval of the holders of a majority of any
outstanding preferred shares, voting separately as a class, would be required
to (a) adopt any plan of reorganization that would adversely affect the
preferred shares and (b) take any action requiring a vote of security holders,
including, among other things, changes in the Trust's subclassification as a
closed-end investment company or changes in its fundamental investment
restrictions.
6. Subsequent Events
Subsequent to May 31, 2005, the Board of Trustees of the Trust declared a
dividend from undistributed net investment income of $0.0687 per common share
payable June 30, 2005, to common shareowners of record on June 15, 2005.
For the period June 1, 2005 to June 30, 2005, dividends declared on preferred
stock totaled $418,441 in aggregate for the three outstanding preferred share
series.
ADDITIONAL INFORMATION (unaudited)
During the period, there have been no material changes in the Trust's
investment objective or fundamental policies that have not been approved by the
shareowners. There have been no changes in the Trust's charter or By-Laws that
would delay or prevent a change in control of the Trust which have not been
approved by the shareowners. There have been no changes in the principal risk
factors associated with investment in the Trust. There have been no changes in
the persons who are primarily responsible for the day-to-day management of the
Trust's portfolio.
35
Pioneer Tax Advantaged Balanced Trust
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NOTES TO FINANCIAL STATEMENTS 5/31/05 (unaudited) (continued)
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Notice is hereby given in accordance with Section 23(C) of the Investment
Company Act of 1940 that the Trust may purchase, from time to time, its common
shares in the open market.
36
Pioneer Tax Advantaged Balanced Trust
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TRUSTEES, OFFICERS AND SERVICE PROVIDERS
Trustees Officers
John F. Cogan, Jr., Chairman John F. Cogan, Jr., President
David R. Bock Osbert M. Hood, Executive
Mary K. Bush Vice President
Margaret B.W. Graham Vincent Nave, Treasurer
Osbert M. Hood Dorothy E. Bourassa, Secretary
Marguerite A. Piret
Stephen K. West
John Winthrop
Investment Adviser
Pioneer Investment Management, Inc.
Custodian
Brown Brothers Harriman & Co.
Legal Counsel
Wilmer Cutler Pickering Hale and Dorr LLP
Transfer Agent
Pioneer Investment Management Shareholder Services, Inc.
Shareowner Services and Sub-Transfer Agent
Mellon Investor Services LLC
Preferred Share Auction/Transfer Agent and Registrar
Deutsche Bank Trust Company Americas
Sub-Administrator
Princeton Administrators, L.P.
Proxy Voting Policies and Procedures of the Trust are available without charge,
upon request, by calling our toll free number (1-800-225-6292). Information
regarding how the Trust voted proxies relating to portfolio securities during
the most recent 6-month period ended August 31, 2004 is publicly available to
shareowners at www.pioneerfunds.com. This information is also available on the
Securities and Exchange Commission's web site at http://www.sec.gov.
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HOW TO CONTACT PIONEER
We are pleased to offer a variety of convenient ways for you to contact us for
assistance or information.
You can call Mellon Investor Services LLC for:
Account Information 1-800-710-0935
Telecommunications Device for the Deaf (TDD) 1-800-231-5469
Or write to Mellon Investor Services LLC:
For Write to
General inquiries, lost dividend checks P.O. Box 3315
South Hackensack, NJ
07606-1915
Change of address, account consolidation P.O. Box 3316
South Hackensack, NJ
07606-1916
Lost stock certificates P.O. Box 3317
South Hackensack, NJ
07606-1917
Stock transfer P.O. Box 3312
South Hackensack, NJ
07606-1912
Dividend reinvestment plan (DRIP) P.O. Box 3338
South Hackensack, NJ
07606-1938
For additional information, please contact your investment advisor or visit
our web site www.pioneerfunds.com.
The Trust files a complete statement of investments with the Securities and
Exchange Commission for the first and third quarters for each fiscal year on
Form N-Q. Shareowners may view the filed Form N-Q by visiting the Commission's
web site at http://www.sec.gov. The filed form may also be viewed and copied
at the Commission's Public Reference Room in Washington, DC. Information
regarding the operations of the Public Reference Room may be obtained by
calling 1-800-SEC-0330.
ITEM 2. CODE OF ETHICS.
(a) Disclose whether, as of the end of the period covered by the report, the
registrant has adopted a code of ethics that applies to the registrant's
principal executive officer, principal financial officer, principal accounting
officer or controller, or persons performing similar functions, regardless of
whether these individuals are employed by the registrant or a third party. If
the registrant has not adopted such a code of ethics, explain why it has not
done so.
The registrant has adopted, as of the end of the period covered by this report,
a code of ethics that applies to the registrant's principal executive officer,
principal financial officer, principal accounting officer and controller.
(b) For purposes of this Item, the term "code of ethics" means written standards
that are reasonably designed to deter wrongdoing and to promote:
(1) Honest and ethical conduct, including the ethical handling of actual
or apparent conflicts of interest between personal and professional
relationships;
(2) Full, fair, accurate, timely, and understandable disclosure in
reports and documents that a registrant files with, or submits to, the
Commission and in other public communications made by the registrant;
(3) Compliance with applicable governmental laws, rules, and
regulations;
(4) The prompt internal reporting of violations of the code to an
appropriate person or persons identified in the code; and
(5) Accountability for adherence to the code.
(c) The registrant must briefly describe the nature of any amendment, during the
period covered by the report, to a provision of its code of ethics that applies
to the registrant's principal executive officer, principal financial officer,
principal accounting officer or controller, or persons performing similar
functions, regardless of whether these individuals are employed by the
registrant or a third party, and that relates to any element of the code of
ethics definition enumerated in paragraph (b) of this Item. The registrant must
file a copy of any such amendment as an exhibit pursuant to Item 10(a), unless
the registrant has elected to satisfy paragraph (f) of this Item by posting its
code of ethics on its website pursuant to paragraph (f)(2) of this Item, or by
undertaking to provide its code of ethics to any person without charge, upon
request, pursuant to paragraph (f)(3) of this Item.
The registrant has made no amendments to the code of ethics during the period
covered by this report.
(d) If the registrant has, during the period covered by the report, granted a
waiver, including an implicit waiver, from a provision of the code of ethics to
the registrant's principal executive officer, principal financial officer,
principal accounting officer or controller, or persons performing similar
functions, regardless of whether these individuals are employed by the
registrant or a third party, that relates to one or more of the items set forth
in paragraph (b) of this Item, the registrant must briefly describe the nature
of the waiver, the name of the person to whom the waiver was granted, and the
date of the waiver.
Not applicable.
(e) If the registrant intends to satisfy the disclosure requirement under
paragraph (c) or (d) of this Item regarding an amendment to, or a waiver from,
a provision of its code of ethics that applies to the registrant's principal
executive officer, principal financial officer, principal accounting officer or
controller, or persons performing similar functions and that relates to any
element of the code of ethics definition enumerated in paragraph (b) of this
Item by posting such information on its Internet website, disclose the
registrant's Internet address and such intention.
Not applicable.
(f) The registrant must:
(1) File with the Commission, pursuant to Item 10(a), a copy of its code
of ethics that applies to the registrant's principal executive officer,
principal financial officer, principal accounting officer or controller,
or persons performing similar functions, as an exhibit to its annual
report on this Form N-CSR;
(2) Post the text of such code of ethics on its Internet website and
disclose, in its most recent report on this Form N-CSR, its Internet
address and the fact that it has posted such code of ethics on its
Internet website; or
(3) Undertake in its most recent report on this Form N-CSR to provide to
any person without charge, upon request, a copy of such code of ethics
and explain the manner in which such request may be made.
See Item 10(2)
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
(a) (1) Disclose that the registrant's board of trustees has determined that
the registrant either:
(i) Has at least one audit committee financial expert serving on its audit
committee; or
(ii) Does not have an audit committee financial expert serving on its audit
committee.
The registrant's Board of Trustees has determined that the registrant has at
least one audit committee financial expert.
(2) If the registrant provides the disclosure required by paragraph
(a)(1)(i) of this Item, it must disclose the name of the audit committee
financial expert and whether that person is "independent." In order to be
considered "independent" for purposes of this Item, a member of an audit
committee may not, other than in his or her capacity as a member of the audit
committee, the board of trustees, or any other board committee:
(i) Accept directly or indirectly any consulting, advisory, or other
compensatory fee from the issuer; or
(ii) Be an "interested person" of the investment company as defined in
Section 2(a)(19) of the Act (15 U.S.C. 80a-2(a)(19)).
Ms. Marguerite A. Piret, an independent trustee, is such an audit committee
financial expert.
(3) If the registrant provides the disclosure required by paragraph (a)(1)
(ii) of this Item, it must explain why it does not have an audit committee
financial expert.
Not applicable.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
(a) Disclose, under the caption AUDIT FEES, the aggregate fees billed for each
of the last two fiscal years for professional services rendered by the principal
accountant for the audit of the registrant's annual financial statements or
services that are normally provided by the accountant in connection with
statutory and regulatory filings or engagements for those fiscal years.
N/A
(b) Disclose, under the caption AUDIT-RELATED FEES, the aggregate fees billed in
each of the last two fiscal years for assurance and related services by the
principal accountant that are reasonably related to the performance of the audit
of the registrant's financial statements and are not reported under
paragraph (a) of this Item. Registrants shall describe the nature of the
services comprising the fees disclosed under this category.
N/A
(c) Disclose, under the caption TAX FEES, the aggregate fees billed in each of
the last two fiscal years for professional services rendered by the principal
accountant for tax compliance, tax advice, and tax planning. Registrants shall
describe the nature of the services comprising the fees disclosed under this
category.
N/A
(d) Disclose, under the caption ALL OTHER FEES, the aggregate fees billed in
each of the last two fiscal years for products and services provided by the
principal accountant, other than the services reported in paragraphs (a) through
(c) of this Item. Registrants shall describe the nature of the services
comprising the fees disclosed under this category.
N/A
(e) (1) Disclose the audit committee's pre-approval policies and procedures
described in paragraph (c)(7) of Rule 2-01 of Regulation S-X.
PIONEER FUNDS
APPROVAL OF AUDIT, AUDIT-RELATED, TAX AND OTHER SERVICES
PROVIDED BY THE INDEPENDENT AUDITOR
SECTION I - POLICY PURPOSE AND APPLICABILITY
The Pioneer Funds recognize the importance of maintaining the independence of
their outside auditors. Maintaining independence is a shared responsibility
involving Pioneer Investment Management, Inc ("PIM"), the audit committee and
the independent auditors.
The Funds recognize that a Fund's independent auditors: 1) possess knowledge of
the Funds, 2) are able to incorporate certain services into the scope of the
audit, thereby avoiding redundant work, cost and disruption of Fund personnel
and processes, and 3) have expertise that has value to the Funds. As a result,
there are situations where it is desirable to use the Fund's independent
auditors for services in addition to the annual audit and where the potential
for conflicts of interests are minimal. Consequently, this policy, which is
intended to comply with Rule 210.2-01(C)(7), sets forth guidelines and
procedures to be followed by the Funds when retaining the independent audit firm
to perform audit, audit-related tax and other services under those
circumstances, while also maintaining independence.
Approval of a service in accordance with this policy for a Fund shall also
constitute approval for any other Fund whose pre-approval is required pursuant
to Rule 210.2-01(c)(7)(ii).
In addition to the procedures set forth in this policy, any non-audit services
that may be provided consistently with Rule 210.2-01 may be approved by the
Audit Committee itself and any pre-approval that may be waived in accordance
with Rule 210.2-01(c)(7)(i)(C) is hereby waived.
Selection of a Fund's independent auditors and their compensation shall be
determined by the Audit Committee and shall not be subject to this policy.
SECTION II - POLICY
---------------- -------------------------------- -------------------------------------------------
SERVICE SERVICE CATEGORY DESCRIPTION SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
CATEGORY
---------------- -------------------------------- -------------------------------------------------
I. AUDIT Services that are directly o Accounting research assistance
SERVICES related to performing the o SEC consultation, registration
independent audit of the Funds statements, and reporting
o Tax accrual related matters
o Implementation of new accounting
standards
o Compliance letters (e.g. rating agency
letters)
o Regulatory reviews and assistance
regarding financial matters
o Semi-annual reviews (if requested)
o Comfort letters for closed end
offerings
---------------- -------------------------------- -------------------------------------------------
II. Services which are not o AICPA attest and agreed-upon procedures
AUDIT-RELATED prohibited under Rule o Technology control assessments
SERVICES 210.2-01(C)(4) (the "Rule") o Financial reporting control assessments
and are related extensions of o Enterprise security architecture
the audit services support the assessment
audit, or use the
knowledge/expertise gained
from the audit procedures as a
foundation to complete the
project. In most cases, if
the Audit-Related Services are
not performed by the Audit
firm, the scope of the Audit
Services would likely
increase. The Services are
typically well-defined and
governed by accounting
professional standards (AICPA,
SEC, etc.)
---------------- -------------------------------- -------------------------------------------------
------------------------------------- ------------------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------- ------------------------------------
o "One-time" pre-approval o A summary of all such
for the audit period for all services and related fees
pre-approved specific service reported at each regularly
subcategories. Approval of the scheduled Audit Committee
independent auditors as meeting.
auditors for a Fund shall
constitute pre approval for
these services.
------------------------------------- ------------------------------------
o "One-time" pre-approval o A summary of all such
for the fund fiscal year within services and related fees
a specified dollar limit (including comparison to
for all pre-approved specified dollar limits)
specific service subcategories reported quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limit for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for Audit-Related
Services not denoted as
"pre-approved", or
to add a specific service
subcategory as "pre-approved"
------------------------------------- ------------------------------------
SECTION III - POLICY DETAIL, CONTINUED
----------------------- --------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
DESCRIPTION
----------------------- --------------------------- -----------------------------------------------
III. TAX SERVICES Services which are not o Tax planning and support
prohibited by the Rule, o Tax controversy assistance
if an officer of the Fund o Tax compliance, tax returns, excise
determines that using the tax returns and support
Fund's auditor to provide o Tax opinions
these services creates
significant synergy in
the form of efficiency,
minimized disruption, or
the ability to maintain a
desired level of
confidentiality.
----------------------- --------------------------- -----------------------------------------------
------------------------------------- -------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------- -------------------------
------------------------------------- -------------------------
o "One-time" pre-approval o A summary of
for the fund fiscal year all such services and
within a specified dollar limit related fees
(including comparison
to specified dollar
limits) reported
quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limits for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for tax services not
denoted as pre-approved, or to add a specific
service subcategory as
"pre-approved"
------------------------------------- -------------------------
SECTION III - POLICY DETAIL, CONTINUED
----------------------- --------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
DESCRIPTION
----------------------- --------------------------- -----------------------------------------------
IV. OTHER SERVICES Services which are not o Business Risk Management support
prohibited by the Rule, o Other control and regulatory
A. SYNERGISTIC, if an officer of the Fund compliance projects
UNIQUE QUALIFICATIONS determines that using the
Fund's auditor to provide
these services creates
significant synergy in
the form of efficiency,
minimized disruption,
the ability to maintain a
desired level of
confidentiality, or where
the Fund's auditors
posses unique or superior
qualifications to provide
these services, resulting
in superior value and
results for the Fund.
----------------------- --------------------------- -----------------------------------------------
--------------------------------------- ------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------- --------------------------
o "One-time" pre-approval o A summary of
for the fund fiscal year within all such services and
a specified dollar limit related fees
(including comparison
to specified dollar
limits) reported
quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limits for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for "Synergistic" or
"Unique Qualifications" Other
Services not denoted as
pre-approved to the left, or to
add a specific service
subcategory as "pre-approved"
------------------------------------- --------------------------
SECTION III - POLICY DETAIL, CONTINUED
----------------------- ------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PROHIBITED SERVICE SUBCATEGORIES
DESCRIPTION
----------------------- ------------------------- -----------------------------------------------
PROHIBITED SERVICES Services which result 1. Bookkeeping or other services
in the auditors losing related to the accounting records or
independence status financial statements of the audit
under the Rule. client*
2. Financial information systems design
and implementation*
3. Appraisal or valuation services,
fairness* opinions, or
contribution-in-kind reports
4. Actuarial services (i.e., setting
actuarial reserves versus actuarial
audit work)*
5. Internal audit outsourcing services*
6. Management functions or human
resources
7. Broker or dealer, investment
advisor, or investment banking services
8. Legal services and expert services
unrelated to the audit
9. Any other service that the Public
Company Accounting Oversight Board
determines, by regulation, is
impermissible
----------------------- ------------------------- -----------------------------------------------
------------------------------------------- ------------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------------- ------------------------------
o These services are not to be o A summary of all
performed with the exception of the(*) services and related
services that may be permitted fees reported at each
if they would not be subject to audit regularly scheduled
procedures at the audit client (as Audit Committee meeting
defined in rule 2-01(f)(4)) level will serve as continual
the firm providing the service. confirmation that has
not provided any
restricted services.
------------------------------------------- ------------------------------
--------------------------------------------------------------------------------
GENERAL AUDIT COMMITTEE APPROVAL POLICY:
o For all projects, the officers of the Funds and the Fund's auditors will each
make an assessment to determine that any proposed projects will not impair
independence.
o Potential services will be classified into the four non-restricted service
categories and the "Approval of Audit, Audit-Related, Tax and Other
Services" Policy above will be applied. Any services outside the specific
pre-approved service subcategories set forth above must be specifically
approved by the Audit Committee.
o At least quarterly, the Audit Committee shall review a report summarizing the
services by service category, including fees, provided by the Audit firm as
set forth in the above policy.
--------------------------------------------------------------------------------
(2) Disclose the percentage of services described in each of paragraphs (b)
through (d) of this Item that were approved by the audit committee pursuant
to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.
N/A
(f) If greater than 50 percent, disclose the percentage of hours expended on the
principal accountant's engagement to audit the registrant's financial statements
for the most recent fiscal year that were attributed to work performed by
persons other than the principal accountant's full-time, permanent employees.
N/A
(g) Disclose the aggregate non-audit fees billed by the registrant's accountant
for services rendered to the registrant, and rendered to the registrant's
investment adviser (not including any sub-adviser whose role is primarily
portfolio management and is subcontracted with or overseen by another investment
adviser), and any entity controlling, controlled by, or under common control
with the adviser that provides ongoing services to the registrant for each of
the last two fiscal years of the registrant.
The Fund's independent auditor, Ernst & Young
LLP ("E&Y"), has advised the Securities
and Exchange Commission, the Public Company
Accounting Oversight Board, and the Audit
Committee of the Fund's Board of Trustees that
certain non-audit work performed by E&Y's China
affiliate raised questions regarding E&Y's
independence with respect to its performance of
audit services for the Fund. In July 2004, E&Y
became aware that member firms in China ("E&Y
China") provided certain tax services to offices of
UniCredito Italiano, S.p.A. ("UCI"), a member of
the Fund's Investment Company Complex. The
services included receipt and disbursement of
monies transferred to E&Y China by UCI in
payment of individual expatriate income taxes due
on returns prepared by E&Y China for certain UCI
employees located in China from October 1998 to
May 2003. E&Y became auditors of the Fund in
May 2002. These expatriate tax services were
discontinued in May 2003. The fees received by
E&Y China for all such services totaled $3,685.
The Fund's Audit Committee and E&Y have
discussed the matter, including the nature of the
services provided, the personnel involved in
providing the services and the fees received by
E&Y for performing the services. E&Y has informed
the Audit Committee that based on its internal reviews
and the de minimis nature of the services provided and
fees received, it does not believe its independence
with respect to the Fund has been impaired.
N/A
(h) Disclose whether the registrant's audit committee of the board of trustees
has considered whether the provision of non-audit services that were rendered to
the registrant's investment adviser (not including any subadviser whose role is
primarily portfolio management and is subcontracted with or overseen by another
investment adviser), and any entity controlling, controlled by, or under common
control with the investment adviser that provides ongoing services to the
registrant that were not pre-approved pursuant to paragraph (c)(7)(ii) of
Rule 2-01 of Regulation S-X is compatible with maintaining the principal
accountant's independence.
N/A
ITEMS 5-6. [RESERVED]
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
A closed-end management investment company that is filing an annual report on
this Form N-CSR must, unless it invests exclusively in non-voting securities,
describe the policies and procedures that it uses to determine how to vote
proxies relating to portfolio securities, including the procedures that the
company uses when a vote presents a conflict between the interests of its
shareholders, on the one hand, and those of the company's investment adviser;
principal underwriter; or any affiliated person (as defined in Section 2(a)(3)
of the Investment Company Act of 1940 (15 U.S.C. 80a-2(a)(3)) and the rules
thereunder) of the company, its investment adviser, or its principal
underwriter, on the other. Include any policies and procedures of the company's
investment adviser, or any other third party, that the company uses, or that are
used on the company's behalf, to determine how to vote proxies relating to
portfolio securities.
N/A
ITEM 8. [RESERVED]
ITEM 9. CONTROLS AND PROCEDURES.
(a) Disclose the conclusions of the registrant's principal executive officer or
officers and principal financial officer or officers, or persons performing
similar functions, about the effectiveness of the registrant's disclosure
controls and procedures (as defined in Rule 30a-2(c) under the Act (17 CFR
270.30a-2(c))) based on their evaluation of these controls and procedures as of
a date within 90 days of the filing date of the report that includes the
disclosure required by this paragraph.
The registrant's principal executive officer and principal financial
officer have concluded, that the registrant's disclosure controls and
procedures are effective based on their evaluation of these controls and
procedures as of a date within 90 days of the filing date of this report.
(b) Disclose whether or not there were significant changes in the registrant's
internal controls or in other factors that could significantly affect these
controls subsequent to the date of their evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
There were no significant changes in the registrant's internal controls or
in other factors that could significantly affect these controls subsequent to
the date of their evaluation, including any corrective actions with regard
to significant deficiencies and material weaknesses.
ITEM 10. EXHIBITS.
File the exhibits listed below as part of this Form. Letter or number the
exhibits in the sequence indicated.
(a) Any code of ethics, or amendment thereto, that is the subject of the
disclosure required by Item 2, to the extent that the registrant intends to
satisfy the Item 2 requirements through filing of an exhibit.
(b) A separate certification for each principal executive officer and principal
financial officer of the registrant as required by Rule 30a-2 under the Act
(17 CFR 270.30a-2).
Filed herewith.
SIGNATURES
[See General Instruction F]
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) Pioneer Tax Advantaged Balanced Trust
By (Signature and Title)* /s/ John F. Cogan, Jr.
John F. Cogan, Jr, President
Date July 29, 2005
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By (Signature and Title)* /s/ John F. Cogan, Jr.
John F. Cogan, Jr., President
Date July 29, 2005
By (Signature and Title)* /s/ Vincent Nave
Vincent Nave, Treasurer
Date July 29, 2005
* Print the name and title of each signing officer under his or her signature.