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: 811-07732
ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND, INC.
(Exact name of registrant as specified in charter)
1345 Avenue of the Americas, New York, New York 10105
(Address of principal executive offices) (Zip code)
Mark R. Manley
AllianceBernstein L.P.
1345 Avenue of the Americas
New York, New York 10105
(Name and address of agent for service)
Registrant's telephone number, including area code: (800) 221-5672
Date of fiscal year end: March 31, 2007
Date of reporting period: March 31, 2007
ITEM 1. REPORTS TO STOCKHOLDERS.
[LOGO]
ALLIANCEBERNSTEIN
INVESTMENTS
AllianceBernstein Global High Income Fund
(formerly Alliance World Dollar Government Fund II)
Annual Report
March 31, 2007
Investment Products Offered
---------------------------
o Are Not FDIC Insured
o May Lose Value
o Are Not Bank Guaranteed
---------------------------
You may obtain a description of the Fund's proxy voting policies and
procedures, and information regarding how the Fund voted proxies relating to
portfolio securities during the most recent 12-month period ended June 30,
without charge. Simply visit AllianceBernstein's web site at
www.alliancebernstein.com, or go to the Securities and Exchange Commission's
(the "Commission") web site at www.sec.gov, or call AllianceBernstein(R) at
(800) 227-4618.
The Fund files its complete schedule of portfolio holdings with the Commission
for the first and third quarters of each fiscal year on Form N-Q. The Fund's
Forms N-Q are available on the Commission's web site at www.sec.gov. The Fund's
Forms N-Q may also be reviewed and copied at the Commission's Public Reference
Room in Washington, DC; information on the operation of the Public Reference
Room may be obtained by calling (800) SEC-0330.
AllianceBernstein Investments, Inc. is an affiliate of AllianceBernstein L.P.,
the manager of the AllianceBernstein funds, and is a member of the NASD.
AllianceBernstein(R) and the AB Logo are registered trademarks and service
marks used by permission of the owner, AllianceBernstein L.P.
May 25, 2007
Annual Report
This report provides management's discussion of fund performance for
AllianceBernstein Global High Income Fund (the "Fund") for the annual reporting
period ended March 31, 2007. The Fund is a closed-end fund that trades under
the New York Stock Exchange symbol "AWF." Effective January 26, 2007, the Fund
changed its name from Alliance World Dollar Government Fund II, Inc. to
AllianceBernstein Global High Income Fund, Inc. to reflect the new investment
policies and guidelines, which are discussed below, and to brand the Fund with
the same AllianceBernstein name used for most other funds in the
AllianceBernstein family of funds. On April 13, 2007, the Fund acquired all of
the assets and assumed the liabilities of Alliance World Dollar Government
Fund, Inc. in exchange for shares of the Fund.
Investment Objective and Policies
This closed-end fund seeks high current income and secondarily, capital
appreciation. At a Special Meeting of the Fund's stockholders held on December
12, 2006, stockholders approved a proposal to eliminate the fundamental
investment restriction requiring that the Fund invest at least 65% of its total
assets in sovereign debt obligations issued or guaranteed by foreign
governments. The Fund is now permitted to invest, without limit, in securities
denominated in non-U.S. currencies as well as those denominated in the U.S.
dollar. The Fund may also invest, without limit, in sovereign debt securities
issued by emerging and developed nations and in debt securities of U.S. and
non-U.S. corporate issuers. For more information regarding the Fund's risks,
please see "A Word About Risk" on page 4 and "Note E--Risks Involved in
Investing in the Fund" of the Notes to Financial Statements on page 33.
Investment Results
The table on page 5 shows the Fund's performance compared to its new benchmark,
the J.P. Morgan Emerging Markets Bond Index Global (JPM EMBI Global) and its
old benchmark, the J.P. Morgan Emerging Markets Bond Index Plus (JPM EMBI+).
The JPM EMBI Global tracks total returns for U.S. dollar-denominated debt
instruments issued by emerging market sovereign and quasi-sovereign entities,
Brady bonds, loans and eurobonds. The JPM EMBI Global is a more appropriate
index for the Fund because it contains a broader representation of the emerging
market debt universe than the JPM EMBI+.
The Fund outperformed both the old and new benchmarks for both the six- and
12-month periods ended March 31, 2007. Contributing positively to performance
for both periods was the Fund's exposure to unhedged local currency emerging
market debt, which outperformed the benchmark.
Significantly adding to the Fund's return was the Fund's exposure to local debt
in Brazil, and to a lesser extent Mexico. The Fund's U.S. dollar debt in Peru,
Panama and Indonesia also contributed positively to performance. The Fund's
leveraged position, at a time when emerging market debt countries posted solid
returns, continued to add to relative performance. Both the old and new
benchmarks are unleveraged.
ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND o 1
Detracting from Fund performance for both the six- and 12-month periods was
security selection in Argentina. Although the Fund's country selection of
Argentina contributed positively to performance, shorter maturity bond
selection in the country detracted from performance as Argentina's
longer-duration bonds outperformed.
Market Review and Investment Strategy
The emerging market debt class, as represented by the JPM EMBI Global, posted a
strong return of 10.86% for the annual period ended March 31, 2007,
outperforming most fixed-income sectors. Emerging market debt began the period
in negative territory, dragged down by rising global interest rates as well as
successive interest-rate hikes by the U.S. Federal Reserve (the "Fed").
Emerging market debt bounced back strongly in the second half of 2006, sparked
by the first U.S. monetary-policy shift in more than two years. The Fed left
the Fed funds rate unchanged at 5.25% in August 2006, and ended their
tightening policy following 425 basis points of consecutive rate hikes.
Additionally, solid global growth, strong investor demand and ample
financial-market liquidity all led to a favorable environment for emerging
market debt.
A temporary spike in volatility, however, returned to the bond market at the
end of February 2007, as global equity markets sold off sharply, led by
declines in China, then Europe and the U.S. China's sell-off was prompted by
its government's proposals to control the market, curbing speculative activity.
Emerging market debt impressed with a quicker recovery than most fixed-income
sectors and ended the period with the yield spread returning to near-record low
levels of 170 basis points over comparable Treasuries.
For the 12-month period ended March 31, 2007, all countries within the Fund's
benchmark posted positive returns, with the exception of Ecuador. Latin
countries at 12.37% outpaced non-Latin regions at 9.02%. Outperforming
countries for the annual period included Argentina at 33.08%, Peru at 16.08%
and Brazil at 15.50%. Underperforming countries for the year included Ecuador
at -0.86% and Lebanon at 3.73%, both of which suffered from political events.
Emerging market debt in local currency terms (unhedged in U.S. dollars) posted
even stronger returns for the period at 12.45%, due to strong local currencies
and falling interest rates. Brazil, the Fund's largest local currency holding,
significantly outperformed, posting a strong return of 26.43%.
Emerging market debt countries favored during the period included Brazil,
Argentina, Peru and Panama, as well as corporate debt in Russia. Like most
Latin American countries, Brazil benefited from a cycle of robust net exports,
capital inflows and prudent fiscal and monetary policy. Brazil has shown
impressive progress in building dollar reserves and has made great strides in
decreasing its external and sovereign debt ratios (the country's outstanding
sovereign debt versus its gross domestic product or GDP), two of the most
critical factors for advancing to investment grade.
2 o ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND
Peru has benefited from strong economic growth, fiscal and current account
surpluses and modest inflation. Peru has also impressed with progress in
building dollar reserves and decreasing its external and sovereign debt ratios
(the country's outstanding sovereign debt versus its GDP). Standard & Poor's
and Fitch Ratings Inc. recently upgraded the country to BB+, one notch below
investment grade, and Moody's Investors Service has placed it on positive
outlook.
Panama benefited from a strengthening economy and canal-related fees, services
and expansion. Panama also continued to be strongly levered to regional and
global growth. During much of the annual period, Russia was favored as it
continued to increase its already high level of U.S. dollar reserves while
paying back debt; it is also likely to join the World Trade Organization by
mid-2007. Also, the Fund's holdings in Ecuador were eliminated due to political
risk.
ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND o 3
HISTORICAL PERFORMANCE
An Important Note About the Value of Historical Performance
The performance shown on the following page represents past performance and
does not guarantee future results. Current performance may be lower or higher
than the performance information shown. All fees and expenses related to the
operation of the Fund have been deducted. Performance assumes reinvestment of
distributions and does not account for taxes.
AllianceBernstein Global High Income Fund Shareholder Information
The Fund's NYSE trading symbol is "AWF." Weekly comparative and market price
information about the Fund is published each Monday in The Wall Street Journal,
each Sunday in The New York Times, each Saturday in Barron's and other
newspapers in a table called "Closed-End Funds." For additional shareholder
information regarding this Fund, please see page 52.
Benchmark Disclosure
Neither the unmanaged J.P. Morgan Emerging Markets Bond Index Global (JPM EMBI
Global) nor the J.P. Morgan Emerging Markets Bond Index Plus (JPM EMBI+)
reflects fees and expenses associated with the active management of a mutual
fund portfolio. The JPM EMBI Global tracks total returns for U.S.
dollar-denominated debt instruments issued by emerging market sovereign and
quasi-sovereign entities, Brady bonds, loans and eurobonds. The JPM EMBI+ is a
standard measure of the performance of a basket of unmanaged emerging market
debt securities. An investor cannot invest directly in an index, and its
results are not indicative of the performance of any specific investment,
including the Fund.
A Word About Risk
The Fund invests primarily in foreign securities which may result in
significant fluctuations due to changes in foreign exchange rates and the
possibility of substantial volatility due to political and economic uncertainty
in foreign countries. The Fund may invest in securities of emerging market
nations, which may present market, credit, currency, liquidity, legal,
political and other risks different from, or greater than, the risks of
investing in developed foreign countries. Fluctuations in the exchange rates
between the U.S. dollar and foreign currencies may negatively affect the value
of the Fund's investments or reduce the returns of the Fund. Price fluctuation
in the Fund's portfolio securities may be caused by changes in the general
level of interest rates or changes in bond credit quality ratings. Please note,
as interest rates rise, existing bond prices fall and can cause the value of an
investment in the Fund to decline. Changes in interest rates have a greater
effect on bonds with longer maturities than on those with shorter maturities.
At the discretion of the Fund's Adviser, the Fund may invest substantially all
of its net assets in bonds that are rated below investment grade (i.e., "junk
bonds") and up to 50% in securities that are not readily marketable. These
high-yield bonds involve a greater risk of default and price volatility than
other bonds. Investing in non-investment grade securities presents special
risks, including credit risk. Investments in the Fund are not guaranteed
because of fluctuation in the net asset value of the underlying fixed-income
related investments. Similar to direct bond ownership, bond funds have the same
interest rate, inflation and credit risks that are associated with the
underlying bonds owned by the Fund. The Fund utilizes leverage, which increases
volatility since leverage magnifies both positive and negative performance. The
Fund maintains asset coverage of at least 300%. While the Fund invests
principally in bonds and other fixed-income securities, in order to achieve its
investment objectives, the Fund may at times use certain types of investment
derivatives, such as options, futures, forwards and swaps. These instruments
involve risks different from, and in certain cases, greater than, the risks
presented by more traditional investments.
(Historical Performance continued on next page)
4 o ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND
HISTORICAL PERFORMANCE
(continued from previous page)
Returns
THE FUND VS. ITS BENCHMARK --------------------------
PERIODS ENDED MARCH 31, 2007 6 Months 12 Months
-------------------------------------------------------------------------------
AllianceBernstein Global High
Income Fund (NAV) 7.54% 12.55%
J.P. Morgan Emerging Markets
Bond Index Global 6.32% 10.86%
J.P. Morgan Emerging Markets
Bond Index Plus 6.73% 11.35%
The Fund's Market Price per share on March 31, 2007 was $13.85. The Fund's
Net Asset Value price per share on March 31, 2007 was $15.19. For additional
Financial Highlights, please see page 40.
GROWTH OF A $10,000 INVESTMENT IN THE FUND
3/31/97 TO 3/31/07
[THE FOLLOWING DATA WAS REPRESENTED BY A MOUNTAIN CHART IN THE PRINTED MATERIAL]
AllianceBernstein Global High Income Fund (NAV): $34,791
JPM EMBI+: $28,936
JPM EMBI Global: $27,870
AllianceBernstein
Global High Income JPM EMBI
Fund (NAV) Global JPM EMBI+
-------------------------------------------------------------------------------
3/31/97 $10,000 $10,000 $10,000
3/31/98 $12,286 $11,665 $11,798
3/31/99 $ 8,827 $10,343 $10,091
3/31/00 $12,726 $12,946 $13,022
3/31/01 $13,711 $14,213 $14,279
3/31/02 $15,935 $14,901 $14,796
3/31/03 $19,153 $16,986 $17,067
3/31/04 $25,074 $20,700 $21,102
3/31/05 $26,814 $22,085 $22,566
3/31/06 $30,911 $25,140 $25,987
3/31/07 $34,791 $27,870 $28,936
This chart illustrates the total value of an assumed $10,000 investment in
AllianceBernstein Global High Income Fund at net asset value (NAV) (from
3/31/97 to 3/31/07) as compared to the performance of the Fund's new and old
benchmarks. The chart assumes the reinvestment of dividends and capital gains
distributions at prices obtained pursuant to the Fund's dividend reinvestment
plan.
See Historical Performance and Benchmark disclosures on previous page.
ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND o 5
PORTFOLIO SUMMARY
March 31, 2007
PORTFOLIO STATISTICS
Net Assets ($bil): $1.0
SECURITY TYPE BREAKDOWN*
o 72.2% Sovereign Debt Obligations
o 27.5% Corporate Debt Obligations [PIE CHART OMITTED]
o 0.2% Warrants
o 0.1% Short-Term
COUNTRY BREAKDOWN*
o 14.8% Brazil
o 14.8% United States
o 11.1% Mexico
o 9.0% Russia
o 7.1% Philippines [PIE CHART OMITTED]
o 6.6% Argentina
o 4.8% Peru
o 4.2% Turkey
o 4.2% Panama
o 4.1% Venezuela
o 3.5% Colombia
o 2.8% Indonesia
o 2.4% Uruguay
o 10.5% Other
o 0.1% Short-Term
* All data are as of March 31, 2007. The Fund's security type and country
breakdowns are expressed as a percentage of total investments and may vary over
time. 'Other' country weightings represents 2.4% or less in the following
countries: Belgium, Bermuda, Bulgaria, Canada, Cayman Islands, China, Costa
Rica, Dominican Republic, El Salvador, France, Hong Kong, Ireland, Jamaica,
Kazakhstan, Lebanon, Luxembourg, Malaysia, Netherlands, Nigeria, Singapore,
South Africa, South Korea, Ukraine and United Kingdom.
6 o ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND
PORTFOLIO OF INVESTMENTS
March 31, 2007
Principal
Amount
(000) U.S. $ Value
-------------------------------------------------------------------------------
SOVEREIGN DEBT OBLIGATIONS-76.8%
Argentina-7.0%
Republic of Argentina
Zero Coupon, 12/15/35(a)(b)* US$ 3 $ 409
5.475%, 8/03/12(a)(c) 35,139 33,310,530
8.28%, 12/31/33(d) 30,562 35,605,306
Series V
7.00%, 3/28/11(a) 2,985 2,959,130
-----------
71,875,375
Brazil-15.1%
Republic of Brazil
7.125%, 1/20/37(a) BRL 39,364 43,497,220
8.00%, 1/15/18(a) 9,038 10,208,421
8.25%, 1/20/34(a) 22,321 28,012,855
8.875%, 10/14/19-4/15/24(a) 19,134 24,553,541
10.25%, 1/10/28(a) 2,615 1,265,920
12.50%, 1/05/16-1/05/22(a) 84,830 47,834,968
-----------
155,372,925
Bulgaria-0.4%
Republic of Bulgaria
8.25%, 1/15/15(a)(e) US$ 3,204 3,788,730
Colombia-3.7%
Republic of Colombia
7.375%, 9/18/37(a) 7,033 7,651,904
8.125%, 5/21/24(a) 1,000 1,165,000
10.75%, 1/15/13(a) 8,057 9,982,623
11.75%, 3/01/10(a) COP 9,901,000 4,778,048
11.75%, 2/25/20(a) US$ 8,239 12,070,135
12.00%, 10/22/15(a) COP 4,063,000 2,150,908
-----------
37,798,618
Costa Rica-0.6%
Costa Rican Colon Structured Note
Zero Coupon, 1/10/08(a) CRC 1,399,190 2,543,982
Republic of Costa Rica
8.05%, 1/31/13(a)(e) US$ 1,888 2,069,248
8.11%, 2/01/12(a)(e) 1,745 1,907,285
-----------
6,520,515
Dominican Republic-0.9%
Dominican Peso Structured Notes
11.871%, 1/07/08(a) DOP 189,300 5,390,142
Dominican Republic
8.625%, 4/20/27(a)(e) US$ 3,550 4,093,150
-----------
9,483,292
ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND o 7
Principal
Amount
(000) U.S. $ Value
-------------------------------------------------------------------------------
El Salvador-1.0%
Republic of El Salvador
7.625%, 9/21/34(a)(e) US$ 2,290 $ 2,639,225
7.65%, 6/15/35(a)(e) 2,960 3,374,400
8.50%, 7/25/11(a)(e) 3,700 4,084,800
-----------
10,098,425
Indonesia-3.0%
Indonesia Rupiah Structured Note
11.07%, 10/15/14(a) IDR 85,451,400 10,125,756
Republic of Indonesia
6.75%, 3/10/14(a)(e) US$ 8,585 8,928,400
6.875%, 3/09/17(a)(e) 3,954 4,171,470
7.25%, 4/20/15(a)(e) 2,480 2,666,000
7.50%, 1/15/16(a)(e) 1,400 1,536,500
8.50%, 10/12/35(a)(e) 2,848 3,488,800
-----------
30,916,926
Jamaica-0.4%
Government of Jamaica
9.25%, 10/17/25(a) 948 1,085,460
10.625%, 6/20/17(a) 2,332 2,831,048
-----------
3,916,508
Lebanon-1.1%
Lebanese Republic
7.875%, 5/20/11(a)(e) 2,475 2,437,875
10.125%, 8/06/08(a)(e) 7,501 7,688,525
11.625%, 5/11/16(a)(e) 1,114 1,308,950
-----------
11,435,350
Mexico-11.6%
Mexican Bonos
Series M 20
10.00%, 12/05/24(a) MXN 89,396 9,955,394
Series MI10
9.00%, 12/20/12(a) 307,882 29,928,440
United Mexican States
8.125%, 12/30/19(a) US$ 12,857 15,781,967
11.375%, 9/15/16(a) 11,110 15,970,625
Series A
6.75%, 9/27/34(a) 6,200 6,761,100
8.00%, 9/24/22(a) 32,632 40,267,888
-----------
118,665,414
Panama-4.4%
MMG Fiduciary (AES El Salvador)
6.75%, 2/01/16(a)(e) 3,100 3,099,606
8 o ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND
Principal
Amount
(000) U.S. $ Value
-------------------------------------------------------------------------------
Republic of Panama
6.70%, 1/26/36(a) US$ 2,728 $ 2,830,300
7.125%, 1/29/26(a) 4,794 5,177,520
7.25%, 3/15/15(a) 2,709 2,933,847
8.875%, 9/30/27(a) 7,527 9,589,398
9.375%, 7/23/12-4/01/29(a) 17,427 21,826,129
-----------
45,456,800
Peru-3.9%
Peru Bono Soberano
8.20%, 8/12/26(a) PEN 9,660 3,676,719
Republic of Peru
7.35%, 7/21/25(a) US$ 6,896 7,847,648
8.375%, 5/03/16(a) 8,144 9,671,000
8.75%, 11/21/33(d) 13,866 18,233,790
9.875%, 2/06/15(a) 128 162,752
-----------
39,591,909
Philippines-7.5%
Republic of Philippines
7.50%, 9/25/24(a) 1,800 1,977,750
7.75%, 1/14/31(a) 6,378 7,191,195
8.00%, 1/15/16(a) 603 679,129
8.25%, 1/15/14(d) 12,842 14,399,093
8.375%, 2/15/11(a) 684 746,586
8.875%, 3/17/15(a)(d) 17,505 20,524,613
9.00%, 2/15/13(a) 2,829 3,257,593
9.50%, 10/21/24-2/02/30(a) 4,650 6,131,025
9.875%, 1/15/19(d) 14,521 18,717,569
10.625%, 3/16/25(a) 2,765 3,919,387
-----------
77,543,940
Russia-3.4%
Russian Federation
7.50%, 3/31/30(a)(e) 30,786 34,911,094
South Africa-0.6%
Republic of South Africa
7.375%, 4/25/12(a) 5,505 5,979,806
Turkey-4.5%
Republic of Turkey
6.875%, 3/17/36(a) 18,028 17,239,275
7.00%, 6/05/20(a) 1,600 1,610,000
7.375%, 2/05/25(a) 9,102 9,352,305
8.00%, 2/14/34(a) 900 979,875
Turkey Government Bond
Zero Coupon, 11/26/08(a) TRY 32,000 17,039,080
-----------
46,220,535
ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND o 9
Principal
Amount
(000) U.S. $ Value
-------------------------------------------------------------------------------
Ukraine-0.8%
Government of Ukraine
6.58%, 11/21/16(a)(e) US$ 3,872 $ 3,926,208
7.65%, 6/11/13(a)(e) 4,217 4,572,493
-----------
8,498,701
Uruguay-2.5%
Republic of Uruguay
7.625%, 3/21/36(a) 1,500 1,650,000
7.875%, 1/15/33(a)(f) 4,310 4,876,781
8.00%, 11/18/22(a) 9,287 10,540,265
9.25%, 5/17/17(a) 3,488 4,272,800
Uruguay Government International Bond
4.25%, 4/05/27(a) UYU 86,400 3,578,381
5.00%, 9/14/18(a) 17,897 815,341
-----------
25,733,568
Venezuela-4.4%
Republic of Venezuela
5.75%, 2/26/16(a) US$ 3,751 3,527,815
6.00%, 12/09/20(a) 1,377 1,273,263
7.00%, 12/01/18(a)(e) 12,542 12,717,588
7.65%, 4/21/25(a) 4,400 4,666,200
8.50%, 10/08/14(a) 5,081 5,614,505
9.25%, 9/15/27(d) 7,615 9,511,135
10.75%, 9/19/13(a) 338 412,698
13.625%, 8/15/18(a) 4,925 7,289,000
-----------
45,012,204
Total Sovereign Debt Obligations
(cost $705,349,018) 788,820,635
CORPORATE DEBT OBLIGATIONS-29.2%
Belgium-0.1%
WDAC Subsidiary Corp.
8.375%, 12/01/14(a)(e) 700 722,750
Bermuda-0.2%
Intelsat Bermuda, Ltd.
8.625%, 1/15/15(a) 650 695,500
11.25%, 6/15/16(e) 1,600 1,816,000
-----------
2,511,500
Brazil-0.6%
Banco BMG SA
9.15%, 1/15/16(a)(e) 3,300 3,547,500
Vale Overseas Ltd.
6.875%, 11/21/36(a) 2,952 3,048,492
-----------
6,595,992
Canada-0.7%
Bombardier, Inc.
8.00%, 11/15/14(a)(e) 1,050 1,081,500
10 o ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND
Principal
Amount
(000) U.S. $ Value
-------------------------------------------------------------------------------
Domtar, Inc.
5.375%, 12/01/13(a) US$ 400 $ 368,500
Nortel Networks Corp.
6.875%, 9/01/23(a) 650 604,500
Nortel Networks Ltd.
10.75%, 7/15/16(a)(e) 600 666,000
Quebecor Media, Inc.
7.75%, 3/15/16(a) 1,400 1,438,500
Rogers Cable, Inc.
6.75%, 3/15/15 1,000 1,035,000
Rogers Wireless, Inc.
7.25%, 12/15/12 1,000 1,068,750
7.50%, 3/15/15(a) 1,000 1,083,750
Shaw Communications, Inc.
7.20%, 12/15/11(a) 200 212,000
-----------
7,558,500
Cayman Islands-0.2%
Seagate Technology HDD Holdings
6.375%, 10/01/11(a) 1,600 1,600,000
China-0.4%
Chaoda Modern Agriculture
7.75%, 2/08/10(a)(e) 3,976 4,025,700
France-0.1%
Rhodia SA
8.875%, 6/01/11(a) 750 781,875
Hong Kong-0.4%
Noble Group Ltd.
6.625%, 3/17/15(a)(e) 4,731 4,459,176
Ireland-0.1%
Elan Finance PLC/Elan Finance Corp.
7.75%, 11/15/11(a) 1,500 1,473,750
Jamaica-0.4%
Digicel Ltd.
9.25%, 9/01/12(a)(e) 3,416 3,603,880
Kazakhstan-0.8%
Alb Finance BV
9.25%, 9/25/13(a)(e) 2,985 2,900,077
Kazkommerts International BV
8.50%, 4/16/13(a)(e) 3,000 3,172,500
Tengizchevroil Finance Co.
6.124%, 11/15/14(a)(e) 2,569 2,556,155
-----------
8,628,732
ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND o 11
Principal
Amount
(000) U.S. $ Value
-------------------------------------------------------------------------------
Luxembourg-0.1%
Nell AF S.a.r.l.
8.375%, 8/15/15(a)(e) US$ 750 $ 781,875
Malaysia-0.8%
Petronas Capital Ltd.
7.00%, 5/22/12(a)(e) 7,265 7,840,533
Mexico-0.3%
Monterrey Power SA de CV
9.625%, 11/15/09(a)(e) 2,526 2,766,284
Netherlands-0.0%
NXP BV/NXP Funding LLC
8.11%, 10/15/13(a)(c)(e) 250 257,187
9.50%, 10/15/15(a)(e) 250 258,125
-----------
515,312
Peru-1.3%
IIRSA Norte Finance Ltd.
8.75%, 5/30/24(a)(e) 2,250 2,643,986
Telefonica del Peru SAA
8.00%, 4/11/16(a)(e) PEN 30,270 10,615,012
-----------
13,258,998
Russia-6.2%
Alfa Bond Issuance PLC
8.625%, 12/09/15(a) US$ 2,360 2,365,900
Citigroup (JSC Severstal)
9.25%, 4/19/14(a)(e) 2,256 2,442,165
Evraz Group SA
8.25%, 11/10/15(a)(e) 3,933 4,037,225
Gallery Capital SA
10.125%, 5/15/13(a)(e) 2,567 2,514,740
Gazprom OAO
9.625%, 3/01/13(a)(e) 27,760 32,744,308
Gazprombank
6.50%, 9/23/15(a) 1,950 1,945,127
Gazstream SA
5.625%, 7/22/13(a)(e) 1,696 1,692,164
Mobile Telesystems Finance
9.75%, 1/30/08(a)(e) 5,390 5,552,495
Russian Standard Finance
7.50%, 10/07/10(a)(e) 3,412 3,279,785
TNK-BP Finance SA
7.50%, 7/18/16(a)(e) 5,777 6,095,785
Tyumen Oil Co.
11.00%, 11/06/07(a)(e) 1,075 1,104,025
-----------
63,773,719
Singapore-0.1%
Avago Technologies Finance
10.375%, 12/01/13(a) 200 216,500
12 o ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND
Principal
Amount
(000) U.S. $ Value
-------------------------------------------------------------------------------
Flextronics International Ltd.
6.50%, 5/15/13(a) US$ 750 $ 742,500
-----------
959,000
South Korea-0.1%
C&M Finance Ltd.
8.10%, 2/01/16(a)(e) 1,405 1,475,250
Ukraine-0.3%
Kyivstar
7.75%, 4/27/12(a)(e) 900 933,750
10.375%, 8/17/09(a)(e) 1,800 1,941,750
-----------
2,875,500
United Kingdom-0.2%
Ineos Group Holdings PLC
8.50%, 2/15/16(a)(e) 850 813,875
Inmarsat Finance PLC
7.625%, 6/30/12(a) 1,000 1,042,500
-----------
1,856,375
United States-15.8%
The AES Corp.
7.75%, 3/01/14(a) 1,900 1,995,000
AK Steel Corp.
7.75%, 6/15/12(a) 800 813,000
Allbritton Communications Co.
7.75%, 12/15/12(a) 700 717,500
Allegheny Energy Supply
8.25%, 4/15/12(a)(e) 1,650 1,806,750
Allied Waste North America, Inc.
6.875%, 6/01/17(a) 1,230 1,233,075
Series B
7.375%, 4/15/14(a) 1,250 1,268,750
American Tower Corp.
7.125%, 10/15/12(a) 1,350 1,390,500
Amkor Technology, Inc.
9.25%, 6/01/16(a) 900 938,250
Aquila, Inc.
14.875%, 7/01/12(a)(g) 700 911,750
Aramark Corp.
8.50%, 2/01/15(a)(e) 1,000 1,040,000
Arch Western Finance LLC
6.75%, 7/01/13(a) 400 393,500
Associated Materials, Inc.
11.25%, 3/01/14(a)(g) 1,000 702,500
Avis Budget Car Rental
7.75%, 5/15/16(a)(e) 750 765,000
Berry Plastics Holding Corp.
8.875%, 9/15/14(a) 700 715,750
The Bon-Ton Dept Stores, Inc.
10.25%, 3/15/14(a) 550 590,563
ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND o 13
Principal
Amount
(000) U.S. $ Value
-------------------------------------------------------------------------------
Boyd Gaming Corp.
7.75%, 12/15/12(a) US$ 450 $ 464,625
Broder Brothers Co.
Series B
11.25%, 10/15/10(a) 400 408,000
Burlington Coat Factory
Warehouse Corp.
11.125%, 4/15/14(a) 250 255,000
CA, Inc.
4.75%, 12/01/09(a)(e) 500 491,061
Cablevision Systems Corp.
Series B
8.00%, 4/15/12(a) 900 913,500
Cadbury Schweppes US Finance LLC
5.125%, 10/01/13(a)(e) 390 377,346
Case New Holland, Inc.
7.125%, 3/01/14(a) 1,660 1,726,400
CCH I Holdings LLC
11.75%, 5/15/14(a)(g) 3,250 3,111,875
Chesapeake Energy Corp.
6.375%, 6/15/15(a) 1,800 1,791,000
Citizens Communications Co.
6.25%, 1/15/13(a) 1,000 992,500
Clear Channel Communications, Inc.
5.50%, 9/15/14(a) 2,100 1,859,145
Complete Production Services, Inc.
8.00%, 12/15/16(a)(e) 200 205,000
Concentra Operating Corp.
9.125%, 6/01/12(a) 650 693,875
Continental Airlines, Inc.
Series RJO3
7.875%, 7/02/18(a) 804 836,442
Couche-Tard Inc.
7.50%, 12/15/13(a) 700 719,250
Covalence Specialty Materials Corp.
10.25%, 3/01/16(a)(e) 300 300,000
Coventry Health Care, Inc.
5.875%, 1/15/12(a) 300 304,782
Cricket Communications, Inc.
9.375%, 11/01/14(a)(e) 1,000 1,060,000
Crown Americas
7.625%, 11/15/13(a) 800 823,000
Crum & Forster Holdings Corp.
10.375%, 6/15/13(a) 500 540,000
CSC Holdings, Inc.
7.625%, 7/15/18(a) 2,000 2,020,000
DaVita, Inc.
7.25%, 3/15/15(a) 700 707,875
DIRECTV Holdings LLC
6.375%, 6/15/15(a) 1,700 1,615,000
14 o ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND
Principal
Amount
(000) U.S. $ Value
-------------------------------------------------------------------------------
DJ CDX NA HY
Series 7-T1
8.375%, 12/29/11(a)(e) US$ 9,500 $ 9,843,900
Dobson Communications Corp.
8.875%, 10/01/13(a) 750 772,500
Dole Food Company, Inc.
8.875%, 3/15/11(a) 600 592,500
Dynegy Holdings, Inc.
8.375%, 5/01/16(a) 600 624,000
E*Trade Financial Corp.
7.375%, 9/15/13(a) 1,150 1,201,750
7.875%, 12/01/15(a) 1,150 1,240,563
Echostar DBS Corp.
7.125%, 2/01/16(a) 1,000 1,032,500
Edison Mission Energy
7.50%, 6/15/13(a) 700 722,750
7.75%, 6/15/16(a) 700 729,750
El Paso Corp.
7.375%, 12/15/12(a) 1,000 1,070,000
El Paso Production Holding Co.
7.75%, 6/01/13(a) 1,000 1,045,000
Ford Motor Co.
7.45%, 7/16/31(a) 2,250 1,740,938
Ford Motor Credit Co.
7.00%, 10/01/13(a) 3,700 3,439,472
8.11%, 1/13/12(a)(c) 500 488,762
Freeport-McMoRan Copper &
Gold, Inc.
8.375%, 4/01/17(a) 1,580 1,708,375
10.125%, 2/01/10(a) 4,800 5,052,000
Freescale Semiconductor, Inc.
8.875%, 12/15/14(a)(e) 500 500,625
10.125%, 12/15/16(a)(e) 1,500 1,503,750
Gaylord Entertainment Co.
8.00%, 11/15/13(a) 800 819,000
General Motors Acceptance Corp.
6.75%, 12/01/14(a) 1,800 1,769,566
General Motors Corp.
8.375%, 7/15/33(a) 1,920 1,723,200
Georgia-Pacific Corp.
7.125%, 1/15/17(a)(e) 800 802,000
Goodman Global Holdings, Inc.
7.875%, 12/15/12(a) 550 552,750
The Goodyear Tire & Rubber Co.
9.00%, 7/01/15(a) 750 823,125
Greektown Holdings LLC
10.75%, 12/01/13(a)(e) 200 214,000
GSC Holdings Corp.
8.00%, 10/01/12(a) 1,200 1,272,000
Hanger Orthopedic Group, Inc.
10.25%, 6/01/14(a) 450 478,125
ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND o 15
Principal
Amount
(000) U.S. $ Value
-------------------------------------------------------------------------------
Harrah's Operating Co. Inc
5.625%, 6/01/15(a) US$ 1,800 $ 1,552,500
HCA, Inc.
6.375%, 1/15/15(a) 2,210 1,886,787
9.25%, 11/15/16(a)(e) 1,850 1,995,687
Healthsouth Corp.
10.75%, 6/15/16(a)(e) 550 598,125
Hertz Corp.
8.875%, 1/01/14(a) 500 538,750
10.50%, 1/01/16(a) 550 627,000
Hexion US Finance Corp./
Hexion Nova
Scotia Finance ULC
9.86%, 11/15/14(a)(c)(e) 550 563,750
Hilcorp Energy I LP/Hilcorp
Finance Co.
7.75%, 11/01/15(a)(e) 300 294,750
Hilton Hotels Corp.
7.625%, 12/01/12(a) 400 426,500
Horizon Lines LLC
9.00%, 11/01/12(a) 300 315,000
Host Hotels & Resorts LP
6.875%, 11/01/14(a) 200 203,000
Host Marriott LP
Series O
6.375%, 3/15/15(a) 1,500 1,488,750
Huntsman International LLC
7.875%, 11/15/14(a)(e) 850 878,687
IASIS Healthcare Corp.
8.75%, 6/15/14(a) 700 724,500
Idearc, Inc.
8.00%, 11/15/16(a)(e) 1,000 1,028,750
International Steel Group, Inc.
6.50%, 4/15/14(a) 1,500 1,561,875
Iron Mountain, Inc.
6.625%, 1/01/16(a) 750 723,750
Jefferson Smurfit Corp. US
8.25%, 10/01/12(a) 400 400,000
Jostens IH Corp.
7.625%, 10/01/12(a) 500 508,750
KB HOME
7.75%, 2/01/10(a) 600 592,500
Keystone Automotive Operations, Inc.
9.75%, 11/01/13(a) 700 680,750
Kinder Morgan Finance Co.
5.70%, 1/05/16(a) 250 234,402
L-3 Communications Corp.
5.875%, 1/15/15 800 777,000
Lamar Media Corp.
6.625%, 8/15/15(a) 350 341,250
16 o ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND
Principal
Amount
(000) U.S. $ Value
-------------------------------------------------------------------------------
Lear Corp.
Series B
8.50%, 12/01/13(a) US$ 600 $ 579,750
8.75%, 12/01/16(a) 1,505 1,437,275
Level 3 Financing, Inc.
8.75%, 2/15/17(a)(e) 1,350 1,360,125
9.25%, 11/01/14(a)(e) 1,305 1,340,887
12.25%, 3/15/13(a) 295 345,150
Levi Strauss & Co.
10.11%, 4/01/12(a)(c) 550 561,000
Liberty Media Corp.
5.70%, 5/15/13(a) 350 335,570
8.25%, 2/01/30(a) 350 349,898
Liberty Mutual Group, Inc.
5.75%, 3/15/14(a)(e) 600 598,363
7.80%, 3/15/37(a)(e) 495 482,610
Lyondell Chemical Company
8.00%, 9/15/14(a) 650 680,875
8.25%, 9/15/16(a) 1,250 1,337,500
Massey Energy Co.
6.875%, 12/15/13(a) 400 379,500
MGM Mirage, Inc.
6.625%, 7/15/15(a) 3,400 3,264,000
Mirant Americas Generation LLC
8.50%, 10/01/21(a) 700 710,500
Mohegan Tribal Gaming Authority
7.125%, 8/15/14(a) 600 609,000
The Mosaic Co.
7.625%, 12/01/16(a)(e) 1,435 1,513,925
NewMarket Corp.
7.125%, 12/15/16(a)(e) 200 199,000
NewPage Corp.
10.00%, 5/01/12(a) 550 601,562
NRG Energy, Inc.
7.375%, 2/01/16-1/15/17(a) 2,690 2,762,112
PanAmSat Corp.
9.00%, 8/15/14(a) 700 757,750
Peabody Energy Corp.
Series B
6.875%, 3/15/13(a) 1,500 1,526,250
Penn National Gaming, Inc.
6.875%, 12/01/11(a) 800 800,000
PetroHawk Energy Corp.
Series WI
9.125%, 7/15/13(a) 500 532,500
Plastipak Holdings, Inc.
8.50%, 12/15/15(a)(e) 300 318,000
PSEG Energy Holdings LLC
8.50%, 6/15/11(a) 400 432,000
Quality Distribution LLC
9.00%, 11/15/10(a) 900 864,000
ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND o 17
Principal
Amount
(000) U.S. $ Value
-------------------------------------------------------------------------------
Qwest Capital Funding, Inc.
7.25%, 2/15/11(a) US$ 1,900 $ 1,945,125
Qwest Corp.
6.875%, 9/15/33(a) 1,000 965,000
Rainbow National Services LLC
8.75%, 9/01/12(a)(e) 500 531,875
10.375%, 9/01/14(a)(e) 500 559,375
Range Resources Corp.
7.50%, 5/15/16(a) 500 515,000
RBS Global, Inc. and Rexnord Corp.
9.50%, 8/01/14(a) 600 624,000
11.75%, 8/01/16(a) 350 375,812
Regency Energy Partners
8.375%, 12/15/13(a)(e) 800 816,000
Reliant Energy, Inc.
6.75%, 12/15/14(a) 1,200 1,267,500
Reynolds American, Inc.
7.25%, 6/01/13(a) 1,350 1,414,679
7.625%, 6/01/16(a) 1,300 1,382,980
RH Donnelley Corp.
Series A-1
6.875%, 1/15/13(a) 500 486,250
Series A-3
8.875%, 1/15/16(a) 200 212,500
Rite Aid Corp.
6.875%, 8/15/13(a) 600 528,000
9.25%, 6/01/13 500 497,500
Rural Cellular Corp.
9.75%, 1/15/10(a) 650 669,500
Sbarro, Inc.
10.375%, 2/01/15(a)(e) 200 208,000
Select Medical Corp.
7.625%, 2/01/15(a) 600 540,000
Serena Software, Inc.
Series WI
10.375%, 3/15/16(a) 200 216,000
Sierra Pacific Resources
8.625%, 3/15/14(a) 600 649,038
Sirius Satellite Radio, Inc.
9.625%, 8/01/13(a) 400 401,500
Six Flags , Inc.
9.75%, 4/15/13(a) 700 666,750
Southern Copper Corp.
7.50%, 7/27/35(a) 3,000 3,233,634
Spectrum Brands, Inc.
7.375%, 2/01/15(a) 500 400,000
Stater Brothers Holdings
8.125%, 6/15/12(a) 300 309,000
Station Casinos, Inc.
6.625%, 3/15/18(a) 300 267,000
18 o ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND
Principal
Amount
(000) U.S. $ Value
-------------------------------------------------------------------------------
Sungard Data Systems, Inc.
9.125%, 8/15/13(a) US$ 1,300 $ 1,394,250
Tenet Healthcare Corp.
7.375%, 2/01/13(a) 1,100 1,021,625
Tenneco, Inc.
8.625%, 11/15/14(a) 300 312,750
Terrestar Networks, Inc.
15.00%, 2/15/14(a)(e)(f) 1,120 1,080,800
Time Warner Telecom Holdings, Inc.
9.25%, 2/15/14(a) 500 535,000
Trinity Industries, Inc.
6.50%, 3/15/14(a) 1,250 1,237,500
Trump Entertainment Resorts, Inc.
8.50%, 6/01/15(a) 200 202,000
Turning Stone Resort
Casino Enterprise
9.125%, 12/15/10(a)(e) 600 609,000
TXU Corp.
Series P
5.55%, 11/15/14(a) 1,050 929,962
Series Q
6.50%, 11/15/24(a) 1,050 884,964
Unisys Corp.
8.00%, 10/15/12(a) 300 300,750
United Rentals North America, Inc.
6.50%, 2/15/12(a) 1,500 1,496,250
Universal City Florida
Holding Co.
8.375%, 5/01/10(a) 400 412,500
Vanguard Health Holding Co.
11.25%, 10/01/15(g) 500 406,250
Visteon Corp.
7.00%, 3/10/14(a) 550 481,250
8.25%, 8/01/10(a) 250 255,000
West Corp.
9.50%, 10/15/14(a)(e) 250 258,750
William Lyon Homes, Inc.
10.75%, 4/01/13(a) 500 482,500
Williams Cos, Inc.
7.625%, 7/15/19(a) 2,600 2,827,500
Windstream Corp.
8.125%, 8/01/13(a) 450 487,125
8.625%, 8/01/16(a) 450 492,188
WMG Holdings Corp.
9.50%, 12/15/14(a)(g) 1,700 1,300,500
Wynn Las Vegas LLC/Corp.
6.625%, 12/01/14(a) 1,500 1,485,000
XM Satellite Radio, Inc.
9.75%, 5/01/14(a) 395 398,456
-----------
161,856,268
Total Corporate Debt Obligations
(cost $298,352,497) 299,920,969
ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND o 19
Shares or
Principal
Amount
(000) U.S. $ Value
-------------------------------------------------------------------------------
WARRANTS-0.2%
Central Bank of Nigeria,
expiring 11/15/20(a)* 9,500 $ 2,422,500
Republic of Venezuela,
expiring 4/15/20* 25,000 0
Total Warrants
(cost $0) 2,422,500
SHORT-TERM INVESTMENTS-0.2%
Time Deposit-0.2%
The Bank of New York
4.25%, 4/02/07 US$ 410 410,000
Societe Generale
5.357%, 4/02/07 1,000 1,000,000
Total Short-Term Investments
(cost $1,410,000) 1,410,000
Total Investments-106.4%
(cost $1,005,111,515) 1,092,574,104
Other assets less liabilities-(6.4)% (65,322,346)
---------------
Net Assets-100.0% $ 1,027,251,758
CREDIT DEFAULT SWAP CONTRACTS (see Note C)
Notional Unrealized
Swap Counterparty & Amount Interest Termination Appreciation/
Referenced Obligation (000) Rate Date (Depreciation)
-------------------------------------------------------------------------------
Buy Contracts:
Citigroup Global Markets, Inc.
(Republic of Hungary
4.50% 2/06/13) $ 3,075 0.50% 11/26/13 $ (43,920)
JPMorgan Chase (Federal
Republic of Hungary
4.75% 2/03/15) 11,300 0.30 10/20/15 18,653
Lehman Brothers (Republic
of Venezuela
9.25% 9/15/27) 11,430 1.26 4/20/10 (44,840)
20 o ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND
Portfolio of Investments
CREDIT DEFAULT SWAP CONTRACTS (see Note C)
continued
Notional Unrealized
Swap Counterparty & Amount Interest Termination Appreciation/
Referenced Obligation (000) Rate Date (Depreciation)
-------------------------------------------------------------------------------
Sale Contracts:
Citigroup Global Markets, Inc.
(Federal Republic of Brazil
12.25% 3/06/30) $19,047 1.98% 4/20/07 $ 190,779
Citigroup Global Markets, Inc.
(Federal Republic of Brazil
12.25% 3/06/30) 18,840 3.09 8/20/10 1,562,948
Citigroup Global Markets, Inc.
(Republic of Philippines
10.625% 3/16/25) 4,070 4.95 3/20/09 347,755
Credit Suisse Markets, Inc.
(Federal Republic of Brazil
12.25% 3/06/30) 5,800 6.90 6/20/07 201,300
Deutsche Bank AG London
(Federal Republic of Brazil
12.25% 3/06/30) 19,047 1.90 4/20/07 183,002
JPMorgan Chase (OAO
Gazprom 5.875% - 10.50%
4/25/07 - 6/01/15) 12,210 1.04 10/20/10 223,396
Lehman Brothers (Republic of
Venezuela 9.25% 9/15/27) 20,910 0.69 4/20/08 19,359
Morgan Stanley (Federal
Republic of Brazil
10.125% 5/15/27) 7,200 17.75 2/13/08 1,256,167
FORWARD CURRENCY EXCHANGE CONTRACTS (see Note C)
U.S. $
Contract Value on U.S. $ Value at Unrealized
Amount Origination March 31, Appreciation/
(000) Date 2007 (Depreciation)
------------------------------------------------------------------------------
Sale Contracts:
Mexican Nuevo Peso
settling 4/24/07 273,560 $24,657,235 $24,753,651 $(96,417)
Mexican Nuevo Peso
settling 4/24/07 545 49,438 49,278 160
REVERSE REPURCHASE AGREEMENTS (see Note C)
Broker Interest Rate Maturity Amount
------------------------------------------------------------------------
JPMorgan Chase 0.10% 12/31/07 $34,480,854
JPMorgan Chase 4.85 12/31/07 18,578,898
JPMorgan Chase 5.00 12/31/07 18,013,903
JPMorgan Chase 5.00 12/31/07 14,925,556
JPMorgan Chase 5.00 12/31/07 13,795,773
JPMorgan Chase 5.05 12/31/07 9,379,840
-------------
$109,174,824
-------------
ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND o 21
(a) Position, or a portion thereof, has been pledged to collateralize forward
currency exchange contracts. The aggregate market value of these securities
amounted to $978,811,212.
(b) Variable rate coupon, rate shown as of March 31, 2007.
(c) Floating Rate Security. Stated interest rate was in effect at March 31,
2007.
(d) Position, or a portion thereof, has been segregated to collateralize
reverse repurchase agreements. The aggregate market value of these securities
amounted to $110,536,892.
(e) Security is exempt from registration under Rule 144A of the Securities Act
of 1933. These securities are considered liquid and may be resold in
transactions exempt from registration, normally to qualified institutional
buyers. At March 31, 2007, the aggregate market value of these securities
amounted to $265,897,795 or 25.9% of net assets.
(f) Pay-In-Kind Payments (PIK).
(g) 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.
* Non-income producing security.
Currency Abbreviations:
BRL - Brazilian Real
COP - Colombian Peso
CRC - Costa Rican Colon
DOP - Dominican Peso
IDR - Indonesian Rupiah
MXN - Mexican Nuevo Peso
PEN - Peruvien Nuevo Sol
TRY - Turkish New Lira
UYU - Uruguayan New Peso
See notes to financial statements.
22 o ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND
STATEMENT OF ASSETS & LIABILITIES
March 31, 2007
Statement of Assets & Liabilities
Assets
Investments in securities, at value (cost $1,005,111,515) $1,092,574,104
Cash 4,088
Unrealized appreciation of swap contracts 4,003,359
Unrealized appreciation of forward currency exchange
contracts 160
Receivable for investment securities sold 27,633,603
Interest receivable 18,525,023
--------------
Total assets 1,142,740,337
--------------
Liabilities
Unrealized depreciation of forward currency exchange
contracts 96,417
Unrealized depreciation of swap contracts 88,760
Reverse repurchase agreements 109,174,824
Payable for investment securities purchased 4,485,708
Advisory fee payable 905,364
Administrative fee payable 32,653
Accrued expenses 704,853
--------------
Total liabilities 115,488,579
--------------
Net Assets $1,027,251,758
--------------
Composition of Net Assets
Capital stock, at par $676,487
Additional paid-in capital 915,684,316
Undistributed net investment income 1,956,647
Accumulated net realized gain on investment and foreign
currency transactions 17,612,991
Net unrealized appreciation of investments and foreign
currency denominated assets and liabilities 91,321,317
--------------
$1,027,251,758
--------------
Net Asset Value Per Share--100 million shares of capital stock authorized, $.01
par value
(based on 67,648,715 shares outstanding) $15.19
------
See notes to financial statements.
ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND o 23
STATEMENT OF OPERATIONS
Year Ended March 31, 2007
Investment Income
Interest $78,382,209
Expenses
Advisory fee $8,912,602
Printing 624,322
Custodian 509,205
Administrative 102,250
Audit 83,568
Legal 63,781
Registration 59,413
Transfer agency 49,233
Directors' fees 37,100
Miscellaneous 40,524
------------
Total expenses before interest expense 10,481,998
Interest expense 6,144,802
------------
Total expenses 16,626,800
------------
Net investment income 61,755,409
------------
Realized and Unrealized Gain (Loss)
on Investment and Foreign Currency
Transactions
Net realized gain on:
Investment transactions 36,465,978
Swap contracts 3,887,853
Foreign currency transactions 191,463
Net change in unrealized
appreciation/depreciation of:
Investments 10,268,348
Swap contracts (2,584,219)
Foreign currency denominated
assets and liabilities (55,871)
------------
Net gain on investment and foreign
currency transactions 48,173,552
------------
Net Increase in Net Assets from
Operations $109,928,961
------------
See notes to financial statements.
24 o ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND
STATEMENT OF CHANGES IN NET ASSETS
Year Ended Year Ended
March 31, March 31,
2007 2006
------------ -----------
Increase (Decrease) in Net Assets
from Operations
Net investment income $ 61,755,409 $ 60,798,214
Net realized gain on investment
and foreign currency transactions 40,545,294 63,847,079
Net change in unrealized
appreciation/depreciation of
investments and foreign currency
denominated assets and liabilities 7,628,258 2,951,812
------------- ------------
Net increase in net assets from
operations 109,928,961 127,597,105
Dividends to Shareholders from
Net investment income (66,464,867) (60,647,076)
------------- ------------
Total increase 43,464,094 66,950,029
Net Assets
Beginning of period 983,787,664 916,837,635
------------- ------------
End of period (including undistributed net
investment income of $1,956,647 and
$2,535,446, respectively) $1,027,251,758 $983,787,664
-------------- ------------
See notes to financial statements.
ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND o 25
STATEMENT OF CASH FLOWS
Year Ended March 31, 2007
Increase (Decrease) in Cash from
Operating Activities:
Interest received $75,782,534
Interest expense paid (5,569,429)
Operating expenses paid (10,076,841)
------------
Net increase in cash from operating
activities $60,136,264
Investing Activities:
Purchases of long-term investments (782,723,793)
Purchases of short-term
investments, net 95,410,228
Proceeds from disposition of long-term
investments 638,516,661
------------
Net decrease in cash from investing
activities (48,796,904)
Financing Activities:
Increase in reverse repurchase
agreements 57,003,128
Cash dividends paid (66,464,867)
------------
Net decrease in cash from financing
activities (9,461,739)
------------
Net increase in cash 1,877,621
Cash at beginning of period (1,873,533)
------------
Cash at end of period $4,088
------------
------------------------------------------------------------------------------
Reconciliation of Net Increase in
Net Assets from Operations to
Net Increase in Cash from Operating
Activities:
Net increase in net assets from
operations $109,928,961
Adjustments:
Increase in interest receivable $(3,345,613)
Net realized gain on investment
and foreign currency transactions (40,545,294)
Net change in unrealized
appreciation/depreciation of
investments and foreign currency
denominated assets and liabilities (7,628,258)
Accretion of bond discount and
amortization of bond premium 745,938
Increase in interest payable 575,373
Increase in accrued expenses 405,157
------------
Total adjustments (49,792,697)
------------
Net Increase in Cash from Operating
Activities $60,136,264
------------
See notes to financial statements.
26 o ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND
NOTES TO FINANCIAL STATEMENTS
March 31, 2007
Notes to Financial Statements
NOTE A
Significant Accounting Policies
AllianceBernstein Global High Income Fund, Inc. (the "Fund"), formerly Alliance
World Dollar Government Fund II, Inc. was incorporated under the laws of the
State of Maryland on May 20, 1993 and is registered under the Investment
Company Act of 1940 as a non-diversified, closed-end management investment
company. The financial statements have been prepared in conformity with U.S.
generally accepted accounting principles, which require management to make
certain estimates and assumptions that affect the reported amounts of assets
and liabilities in the financial statements and amounts of income and expenses
during the reporting period. Actual results could differ from those estimates.
The following is a summary of significant accounting policies followed by the
Fund.
1. Security Valuation
Portfolio securities are valued at their current market value determined on the
basis of market quotations or, if market quotations are not readily available
or are deemed unreliable, at "fair value" as determined in accordance with
procedures established by and under the general supervision of the Fund's Board
of Directors.
In general, the market value of securities which are readily available and
deemed reliable are determined as follows. Securities listed on a national
securities exchange (other than securities listed on The NASDAQ Stock Market,
Inc. ("NASDAQ")) or on a foreign securities exchange are valued at the last
sale price at the close of the exchange or foreign securities exchange. If
there has been no sale on such day, the securities are valued at the mean of
the closing bid and asked prices on such day. Securities listed on more than
one exchange are valued by reference to the principal exchange on which the
securities are traded; securities listed only on NASDAQ are valued in
accordance with the NASDAQ Official Closing Price; listed put or call options
are valued at the last sale price. If there has been no sale on that day, such
securities will be valued at the closing bid prices on that day; open futures
contracts and options thereon are valued using the closing settlement price or,
in the absence of such a price, the most recent quoted bid price. If there are
no quotations available for the day of valuation, the last available closing
settlement price is used; securities traded in the over-the-counter market,
("OTC") are valued at the mean of the current bid and asked prices as reported
by the National Quotation Bureau or other comparable sources; U.S. Government
securities and other debt instruments having 60 days or less remaining until
maturity are valued at amortized cost if their original maturity was 60 days or
less; or by amortizing their fair value as of the 61st day prior to maturity if
their original term to maturity exceeded 60 days; fixed-income securities,
including mortgage backed and asset backed securities, may be valued on the
basis of prices provided by a pricing service or at a price obtained from one
or more of the major broker/dealers. In cases where broker/dealer
ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND o 27
quotes are obtained, AllianceBernstein L.P. (the "Adviser") may establish
procedures whereby changes in market yields or spreads are used to adjust, on a
daily basis, a recently obtained quoted price on a security; and OTC and other
derivatives are valued on the basis of a quoted bid price or spread from a
major broker/dealer in such security.
Securities for which market quotations are not readily available (including
restricted securities) or are deemed unreliable are valued at fair value.
Factors considered in making this determination may include, but are not
limited to, information obtained by contacting the issuer, analysts, analysis
of the issuer's financial statements or other available documents. In addition,
the Fund may use fair value pricing for securities primarily traded in non-U.S.
markets because, most foreign markets close well before the Fund values its
securities at 4:00 p.m., Eastern Time. The earlier close of these foreign
markets gives rise to the possibility that significant events, including broad
market moves, may have occurred in the interim and may materially affect the
value of those securities.
2. Currency Translation
Assets and liabilities denominated in foreign currencies and commitments under
forward currency exchange contracts are translated into U.S. dollars at the
mean of the quoted bid and asked prices of such currencies against the U.S.
dollar. Purchases and sales of portfolio securities are translated into U.S.
dollars at the rates of exchange prevailing when such securities were acquired
or sold. Income and expenses are translated into U.S. dollars at the rates of
exchange prevailing when accrued.
Net realized gain or loss on foreign currency transactions represents foreign
exchange gains and losses from sales and maturities of foreign fixed income
investments, foreign currency exchange contracts, holding of foreign
currencies, currency gains or losses realized between the trade and settlement
dates on foreign investment transactions, and the difference between the
amounts of dividends, interest and foreign withholding taxes recorded on the
Fund's books and the U.S. dollar equivalent amounts actually received or paid.
Net unrealized currency gains and losses from valuing foreign currency
denominated assets and liabilities at period end exchange rates are reflected
as a component of net unrealized appreciation and depreciation of investments
and foreign currency denominated assets and liabilities.
3. Taxes
It is the Fund's policy to meet the requirements of the Internal Revenue Code
applicable to regulated investment companies and to distribute all of its
investment company taxable income and net realized gains, if any, to
shareholders. Therefore, no provisions for federal income or excise taxes are
required. The Fund may be subject to taxes imposed by countries in which it
invests. Such taxes are generally based on income and/or capital gains earned
or repatriated. Taxes
28 o ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND
Notes to Financial Statements
are accrued and applied to net investment income, net realized gains and net
unrealized appreciation/depreciation as such income and/or gains are earned.
4. Investment Income and Investment Transactions
Interest income is accrued daily. Investment transactions are accounted for on
the date securities are purchased or sold. Investment gains and losses are
determined on the identified cost basis. The Fund amortizes premiums and
accretes discounts as adjustments to interest income.
5. Dividends and Distributions
Dividends and distributions to shareholders are recorded on the ex-dividend
date. Income and capital gains distributions are determined in accordance with
federal tax regulations and may differ from those determined in accordance with
U.S. generally accepted accounting principles. To the extent these differences
are permanent, such amounts are reclassified within the capital accounts based
on their federal tax basis treatment; temporary differences do not require such
reclassification.
NOTE B
Advisory Fee and Other Transactions with Affiliates
Under the terms of the Investment Advisory Agreement, the Fund pays the Adviser
an advisory fee at an annual rate of .90% of the Fund's average weekly net
assets. Prior to October 1, 2005, the Fund paid the Adviser an advisory fee at
an annual rate of 1.00% of the Fund's average weekly net assets. Such fee is
accrued daily and paid monthly.
Pursuant to the Administration Agreement in effect until October 1, 2005, the
Fund paid the Adviser an administrative fee of .15% of the Fund's average
weekly net assets. Effective that date pursuant to an Amended Administration
Agreement, the Fund reimburses the Adviser for its costs, including legal and
accounting costs, in serving as Administrator of the Fund; provided, however,
that the reimbursement may not exceed the prior fee of .15% of average weekly
net assets. For the year ended March 31, 2007, the Fund paid the Adviser
$102,250 for its administrative services, representing .01% of the Fund's
average weekly net assets.
Under the terms of a Shareholder Inquiry Agency Agreement with
AllianceBernstein Investor Services, Inc. ("ABIS"), a wholly-owned subsidiary
of the Adviser, the Fund reimburses ABIS for costs relating to servicing phone
inquiries on behalf of the Fund. During the year ended March 31, 2007, the Fund
reimbursed $775 to ABIS.
ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND o 29
NOTE C
Investment Transactions
Purchases and sales of investment securities (excluding short-term investments)
for the year ended March 31, 2007, were as follows:
Purchases Sales
------------ -------------
Investment securities (excluding
U.S. government securities) $ 785,480,546 $ 660,776,895
U.S. government securities -0- -0-
The cost of investments for federal income tax purposes, gross unrealized
appreciation and unrealized depreciation (excluding swap contracts and foreign
currency transactions) are as follows:
Cost $1,006,245,229
--------------
Gross unrealized appreciation $89,152,578
Gross unrealized depreciation (2,823,703)
--------------
Net unrealized appreciation $86,328,875
--------------
1. Forward Currency Exchange Contracts
The Fund may enter into forward currency exchange contracts in order to hedge
its exposure to changes in foreign currency exchange rates on its foreign
portfolio holdings, to hedge certain firm purchase and sale commitments
denominated in foreign currencies and for investment purposes. A forward
currency exchange contract is a commitment to purchase or sell a foreign
currency on a future date at a negotiated forward rate. The gain or loss
arising from the difference between the original contract and the closing of
such contract would be included in net realized gain or loss on foreign
currency transactions.
Fluctuations in the value of open forward currency exchange contracts are
recorded for financial reporting purposes as unrealized appreciation and
depreciation by the Fund.
The Fund's custodian will place and maintain cash not available for investment
or other liquid assets in a separate account of the Fund having a value at
least equal to the aggregate amount of the Fund's commitments under forward
currency exchange contracts entered into with respect to position hedges.
Risks may arise from the potential inability of the counterparty to meet the
terms of a contract and from unanticipated movements in the value of a foreign
currencies relative to the U.S. dollar. The face or contract amount, in U.S.
dollars reflects the total exposure the Fund has in that particular currency
contract.
30 o ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND
Notes to Financial Statements
2. Option Transactions
For hedging and investment purposes, the Fund may purchase and write (sell) put
and call options on U.S. and foreign government securities and foreign
currencies that are traded on U.S. and foreign securities exchanges and
over-the-counter markets.
The risk associated with purchasing an option is that the Fund pays a premium
whether or not the option is exercised. Additionally, the Fund bears the risk
of loss of premium and change in market value should the counterparty not
perform under the contract. Put and call options purchased are accounted for in
the same manner as portfolio securities. The cost of securities acquired
through the exercise of call options is increased by premiums paid. The
proceeds from securities sold through the exercise of put options are decreased
by the premiums paid.
When the Fund writes an option, the premium received by the Fund is recorded as
a liability and is subsequently adjusted to the current market value of the
option written. Premiums received from written options which expire unexercised
are recorded by the Fund on the expiration date as realized gains from options
written. The difference between the premium received and the amount paid on
effecting a closing purchase transaction, including brokerage commissions, is
also treated as a realized gain, or if the premium received is less than the
amount paid for the closing purchase transaction, as a realized loss. If a call
option is exercised, the premium received is added to the proceeds from the
sale of the underlying security or currency in determining whether the Fund has
realized a gain or loss. If a put option is exercised, the premium received
reduces the cost basis of the security or currency purchased by the Fund. In
writing an option, the Fund bears the market risk of an unfavorable change in
the price of the security or currency underlying the written option. Exercise
of an option written by the Fund could result in the Fund's selling or buying a
security or currency at a price different from the current market value.
For the year ended March 31, 2007, the Fund had no transactions in written
options.
3. Swap Agreements
The Fund may enter into swaps to hedge its exposure to interest rates and
credit risk or for investment purposes. A swap is an agreement that obligates
two parties to exchange a series of cash flows at specified intervals based
upon or calculated by reference to changes in specified prices or rates for a
specified amount of an underlying asset. The payment flows are usually netted
against each other, with the difference being paid by one party to the other.
Risks may arise as a result of the failure of the counterparty to the swap
contract to comply with the terms of the swap contract. The loss incurred by
the failure of
ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND o 31
a counterparty is generally limited to the net interim payment to be received
by the Fund, and/or the termination value at the end of the contract.
Therefore, the Fund considers the creditworthiness of each counterparty to a
swap contract in evaluating potential credit risk. Additionally, risks may
arise from unanticipated movements in interest rates or in the value of the
underlying securities.
The Fund accrues for the interim payments on swap contracts on a daily basis,
with the net amount recorded within unrealized appreciation/depreciation of
swap contracts on the statement of assets and liabilities. Once the interim
payments are settled in cash, the net amount is recorded as realized gain/loss
on swaps, in addition to realized gain/loss recorded upon the termination of
swap contracts on the statement of operations. Fluctuations in the value of
swap contracts are recorded as a component of net change in unrealized
appreciation/depreciation of investments.
The Fund may enter into credit default swaps. The Fund may purchase credit
protection on the referenced obligation of the credit default swap ("Buy
Contract") or provide credit protection on the referenced obligation of the
credit default swap ("Sale Contract"). A sale/(buy) in a credit default swap
provides upon the occurrence of a credit event, as defined in the swap
agreement, for the Fund to buy/(sell) from/(to) the counterparty at the
notional amount (the "Notional Amount") and receive/(deliver) the principal
amount of the referenced obligation. If a credit event occurs, the maximum
payout amount for a Sale Contract is limited to the Notional Amount of the swap
contract ("Maximum Payout Amount"). During the term of the swap agreement, the
Fund receives/(pays) fixed payments from/(to) the respective counterparty,
calculated at the agreed upon interest rate applied to the Notional Amount.
These interim payments are recorded within unrealized appreciation/depreciation
of swap contracts on the statement of assets and liabilities.
Credit default swaps may involve greater risks than if a Fund had invested in
the referenced obligation directly. Credit default swaps are subject to general
market risk, liquidity risk, counterparty risk and credit risk. If the Fund is
a buyer and no credit event occurs, it will lose its investment. In addition,
if the Fund is a seller and a credit event occurs, the value of the referenced
obligation received by the Fund coupled with the periodic payments previously
received, may be less than the Maximum Payout Amount it pays to the buyer,
resulting in a loss to the Fund.
At March 31, 2007, the Fund had Sale Contracts outstanding with Maximum Payout
Amounts aggregating $107,124,000, with net unrealized appreciation of
$3,984,706 and terms ranging from 1 month to 3 years, as reflected in the
portfolio of investments.
In certain circumstances, the Fund may hold Sale Contracts on the same
referenced obligation and with the same counterparty from which it has pur-
32 o ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND
Notes to Financial Statements
chased credit protection, which may reduce its obligation to make payments on
Sale Contracts, if a credit event occurs. The Fund had buy contracts with a
Notional Amount of $11,430,000 with respect to the same referenced obligations
and same counterparties of certain Sale Contracts outstanding which reduced its
obligation to make payments on Sale Contracts to $95,964,000 as of March 31,
2007.
4. Reverse Repurchase Agreements
Under a reverse repurchase agreement, the Fund sells securities and agrees to
repurchase them at a mutually agreed upon date and price. At the time the Fund
enters into a reverse repurchase agreement, it will establish a segregated
account with the custodian containing liquid assets having a value at least
equal to the repurchase price.
For the year ended March 31, 2007, the average amount of reverse repurchase
agreements outstanding was $143,830,609 and the daily weighted average interest
rate was 4.27%.
NOTE D
Capital Stock
During the years ended March 31, 2007 and March 31, 2006, the Fund issued no
shares in connection with the Fund's dividend reinvestment plan.
NOTE E
Risks Involved in Investing in the Fund
Interest Rate Risk and Credit Risk--Interest rate risk is the risk that changes
in interest rates will affect the value of the Fund's investments in
fixed-income debt securities such as bonds or notes. Increases in interest
rates may cause the value of the Fund's investments to decline. Credit risk is
the risk that the issuer or guarantor of a debt security, or the counterparty
to a derivative contract, will be unable or unwilling to make timely principal
and/or interest payments, or to otherwise honor its obligations. The degree of
risk for a particular security may be reflected in its credit risk rating.
Credit risk is greater for medium quality and lower-rated securities.
Lower-rated debt securities and similar unrated securities (commonly known as
"junk bonds") have speculative elements or are predominantly speculative risks.
Foreign Securities Risk--Investing in securities of foreign companies or
foreign governments involves special risks which include changes in foreign
currency exchange rates and the possibility of future political and economic
developments which could adversely affect the value of such securities.
Moreover, securities of many foreign companies or foreign governments and their
markets may be less liquid and their prices more volatile than those of
comparable U.S. companies and the U.S. government.
ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND o 33
Indemnification Risk--In the ordinary course of business, the Fund enters into
contracts that contain a variety of indemnifications. The Fund's maximum
exposure under these arrangements is unknown. However, the Fund has not had
prior claims or losses pursuant to these indemnification provisions and expects
the risk of loss thereunder to be remote.
Leverage Risk--The Fund may use certain investment techniques that have
increased risks. For example, the Fund may use leverage, through borrowings, to
enhance its returns. For this purpose, the Fund may use reverse repurchase
agreements and dollar rolls, which are considered borrowings, as part of its
investment strategy. Borrowings allow the Fund to increase the amount of money
available to invest in debt securities. As long as the income from the
securities financed is greater than the interest cost of the borrowings, the
Fund's investors benefit from higher returns than if the Fund were not
leveraged.
The use of leverage, which is usually considered speculative, involves certain
risks to stockholders. These include a higher volatility of the NAV of the
common stock caused by favorable or adverse changes in interest rates. In
addition, fluctuations in the interest rates on a fund's borrowings will affect
the return to stockholders, with increases in interest rates decreasing the
fund's return.
To the extent that the current interest rate on a fund's borrowings approaches
the net return on the leveraged portion of the fund's investment portfolio, the
benefit of leverage to stockholders will be reduced. If the current interest
rate on the borrowings were to exceed the net return on that portion of the
fund's portfolio, the fund's leverage would result in a lower rate of return to
stockholders and in a lower NAV than if a fund were not leveraged.
NOTE F
Distributions to Shareholders
The tax character of distributions paid during the fiscal years ended March 31,
2007 and March 31, 2006 were as follows:
2007 2006
------------- ------------
Distributions paid from:
Ordinary income $66,464,867 $60,647,076
------------ ----------
Total taxable distributions 66,464,867 60,647,076
------------ ----------
Total distributions paid $66,464,867 $60,647,076
------------ ----------
34 o ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND
Notes to Financial Statements
As of March 31, 2007, the components of accumulated earnings/(deficit) on a tax
basis were as follows:
Undistributed ordinary income $10,348,257
Undistributed long-term capital gains 14,268,618(a)
Unrealized appreciation/(depreciation) 86,274,080(b)
--------------
Total accumulated earnings (deficit) $110,890,955
(a) During the fiscal year, the Fund utilized capital loss carryforwards of
$17,972,214.
(b) The difference between book-basis and tax-basis unrealized
appreciation/(depreciation) is attributable primarily to the tax deferral of
losses on wash sales, the difference between book and tax amortization methods
for premium and the difference between book and tax treatment of swap income.
During the current fiscal year, permanent differences primarily due to the tax
treatment of swap income, tax character of paydown gain/losses and foreign
currency transactions, and the tax treatment of bond premium, resulted in a net
decrease in distributions in excess of net investment income and a decrease in
accumulated net realized gain on investment transactions. This reclassification
had no effect on net assets.
NOTE G
Legal Proceedings
As has been previously reported, the staff of the U.S. Securities and Exchange
Commission ("SEC") and the Office of the New York Attorney General ("NYAG")
have been investigating practices in the mutual fund industry identified as
"market timing" and "late trading" of mutual fund shares. Certain other
regulatory authorities have also been conducting investigations into these
practices within the industry and have requested that the Adviser provide
information to them. The Adviser has been cooperating and will continue to
cooperate with all of these authorities. The shares of the Fund are not
redeemable by the Fund, but are traded on an exchange at prices established by
the market. Accordingly, the Fund and its shareholders are not subject to the
market timing and late trading practices that are the subject of the
investigations mentioned above or the lawsuits described below. Please see
below for a description of the agreements reached by the Adviser and the SEC
and NYAG in connection with the investigations mentioned above.
Numerous lawsuits have been filed against the Adviser and certain other
defendants in which plaintiffs make claims purportedly based on or related to
the same practices that are the subject of the SEC and NYAG investigations
referred to above. Some of these lawsuits name the Fund as a party. The
lawsuits are now pending in the United States District Court for the District
of Maryland pursuant to a ruling by the Judicial Panel on Multidistrict
Litigation transferring and centralizing all of the mutual funds involving
market and late trading in the District of Maryland (the "Mutual Fund MDL").
Management of the Adviser
ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND o 35
believes that these private lawsuits are not likely to have a material adverse
effect on the results of operations or financial condition of the Fund.
On December 18, 2003, the Adviser confirmed that it had reached terms with the
SEC and the NYAG for the resolution of regulatory claims relating to the
practice of "market timing" mutual fund shares in some of the AllianceBernstein
Mutual Funds. The agreement with the SEC is reflected in an Order of the
Commission ("SEC Order"). The agreement with the NYAG is memorialized in an
Assurance of Discontinuation dated September 1, 2004 ("NYAGOrder"). Among the
key provisions of these agreements are the following:
(i) The Adviser agreed to establish a $250 million fund (the "Reimbursement
Fund") to compensate mutual fund shareholders for the adverse effects of market
timing attributable to market timing relationships described in the SEC Order.
According to the SEC Order, the Reimbursement Fund is to be paid, in order of
priority, to fund investors based on (i) their aliquot share of losses suffered
by the fund due to market timing, and (ii) a proportionate share of advisory
fees paid by such fund during the period of such market timing;
(ii) The Adviser agreed to reduce the advisory fees it receives from some of
the AllianceBernstein long-term, open-end retail funds, commencing January 1,
2004, for a period of at least five years; and
(iii) The Adviser agreed to implement changes to its governance and
compliance procedures. Additionally, the SEC Order contemplates that the
Adviser's registered investment company clients, including the Fund, will
introduce governance and compliance changes.
The shares of the Fund are not redeemable by the Fund, but are traded on an
exchange at prices established by the market. Accordingly, the Fund and its
shareholders are not subject to the market timing practices described in the
SEC Order and are not expected to participate in the Reimbursement Fund. Since
the Fund is a closed-end fund, it did not have its advisory fee reduced
pursuant to the terms of the agreements mentioned above.
On February 10, 2004, the Adviser received (i) a subpoena duces tecum from the
Office of the Attorney General of the State of West Virginia and (ii) a request
for information from West Virginia's Office of the State Auditor, Securities
Commission (the "West Virginia Securities Commissioner") (together, the
"Information Requests"). Both Information Requests require the Adviser to
produce documents concerning, among other things, any market timing or late
trading in the Adviser's sponsored mutual funds. The Adviser responded to the
Information Requests and has been cooperating fully with the investigation.
36 o ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND
Notes to Financial Statements
On April 11, 2005, a complaint entitled The Attorney General of the State of
West Virginia v. AIM Advisors, Inc., et al. ("WVAG Complaint") was filed
against the Adviser, Alliance Capital Management Holding L.P. ("Alliance
Holding"), and various other defendants not affiliated with the Adviser. The
WVAG Complaint was filed in the Circuit Court of Marshall County, West Virginia
by the Attorney General of the State of West Virginia. The WVAG Complaint makes
factual allegations generally similar to those in certain of the complaints
related to the lawsuits discussed above. On October 19, 2005, the WVAG
Complaint was transferred to the Mutual Fund MDL.
On August 30, 2005, the West Virginia Securities Commissioner signed a Summary
Order to Cease and Desist, and Notice of Right to Hearing addressed to the
Adviser and Alliance Holding. The Summary Order claims that the Adviser and
Alliance Holding violated the West Virginia Uniform Securities Act, and makes
factual allegations generally similar to those in the SEC Order and the NYAG
Order. On January 26, 2006, the Adviser, Alliance Holding, and various
unaffiliated defendants filed a Petition for Writ of Prohibition and Order
Suspending Proceedings in West Virginia state court seeking to vacate the
Summary Order and for other relief. The court denied the writ and in September
2006 the Supreme Court of Appeals declined the defendants' petition for appeal.
On September 22, 2006, Alliance and Alliance Holding filed an answer and motion
to dismiss the Summary Order with the Securities Commissioner.
On June 22, 2004, a purported class action complaint entitled Aucoin, et al. v.
Alliance Capital Management L.P., et al. ("Aucoin Complaint") was filed against
the Adviser, Alliance Capital Management Holding L.P., Alliance Capital
Management Corporation, AXA Financial, Inc., AllianceBernstein Investment
Research & Management, Inc., certain current and former directors of the
AllianceBernstein Mutual Funds, and unnamed Doe defendants. The Aucoin
Complaint names certain of the AllianceBernstein mutual funds as nominal
defendants. The Fund was not named as a defendant in the Aucoin Complaint. The
Aucoin Complaint was filed in the United States District Court for the Southern
District of New York by alleged shareholders of an AllianceBernstein mutual
fund. The Aucoin Complaint alleges, among other things, (i) that certain of the
defendants improperly authorized the payment of excessive commissions and other
fees from fund assets to broker-dealers in exchange for preferential marketing
services, (ii) that certain of the defendants misrepresented and omitted from
registration statements and other reports material facts concerning such
payments, and (iii) that certain defendants caused such conduct as control
persons of other defendants. The Aucoin Complaint asserts claims for violation
of Sections 34(b), 36(b) and 48(a) of the Investment Company Act, Sections 206
and 215 of the Advisers Act, breach of common law fiduciary duties, and aiding
and abetting breaches of common law fiduciary duties. Plaintiffs seek an
unspecified amount of compensatory damages and punitive damages, rescission of
their contracts with the Adviser, including recovery of all fees paid to the
Adviser pursuant to such contracts, an accounting of all fund-related fees,
commissions and
ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND o 37
soft dollar payments, and restitution of all unlawfully or discriminatorily
obtained fees and expenses.
Since June 22, 2004, nine additional lawsuits making factual allegations
substantially similar to those in the Aucoin Complaint were filed against the
Adviser and certain other defendants. All nine of the lawsuits (i) were brought
as class actions filed in the United States District Court for the Southern
District of New York, (ii) assert claims substantially identical to the Aucoin
Complaint, and (iii) are brought on behalf of shareholders of the Funds.
On February 2, 2005, plaintiffs filed a consolidated amended class action
complaint ("Aucoin Consolidated Amended Complaint") that asserts claims
substantially similar to the Aucoin Complaint and the nine additional lawsuits
referenced above. On October 19, 2005, the District Court dismissed each of the
claims set forth in the Aucoin Consolidated Amended Complaint, except for
plaintiffs' claim under Section 36(b) of the Investment Company Act. On January
11, 2006, the District Court granted defendants' motion for reconsideration and
dismissed the remaining Section 36(b) claim. On May 31, 2006 the District Court
denied plaintiffs' motion for leave to file an amended complaint. On July 5,
2006, plaintiffs filed a notice of appeal. On October 4, 2006 the appeal was
withdrawn by stipulation, with plaintiffs reserving the right to reinstate it
at a later date.
The Adviser believes that these matters are not likely to have a material
adverse effect on the Fund or the Adviser's ability to perform advisory
services relating to the Fund.
NOTE H
Recent Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board ("FASB") released
FASB Interpretation No. 48 "Accounting for Uncertainty in Income Taxes" ("FIN
48"). FIN 48 provides guidance for how uncertain tax positions should be
recognized, measured, presented and disclosed in the financial statements. FIN
48 requires the evaluation of tax positions taken or expected to be taken in
the course of preparing a fund's tax returns to determine whether the tax
positions are "more-likely-than-not" of being sustained by the applicable tax
authority. Tax positions not deemed to meet the more-likely-than-not threshold
would be recorded in the current period. Adoption of FIN 48 is required for
fiscal years beginning after December 15, 2006 and is to be applied to all open
tax years as of the effective date. On December 22, 2006, the Securities and
Exchange Commission notified the industry that the implementation of FIN 48 by
registered investment companies could be delayed until the last business day of
the first required financial statement reporting period for fiscal years
beginning after December 15, 2006. At this time, management is evaluating the
implications of FIN 48 and its impact on the financial statements has not yet
been determined.
38 o ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND
Notes to Financial Statements
On September 20, 2006, the FASB released Statement of Financial Accounting
Standards No. 157 "Fair Value Measurements" ("FAS 157"). FAS 157 establishes an
authoritative definition of fair value, sets out a framework for measuring fair
value, and requires additional disclosures about fair-value measurements. The
application of FAS 157 is required for fiscal years beginning after November
15, 2007 and interim periods within those fiscal years. At this time,
management is evaluating the implications of FAS 157 and its impact on the
financial statements has not yet been determined.
NOTE I
Subsequent Events
On April 13, 2007, the Fund acquired all of the assets and assumed all of the
liabilities of Alliance World Dollar Government Fund, Inc. ("AWG") in a tax
free event, pursuant to an Agreement and Plan of Acquisition and Liquidation
approved by the stockholders of AWG at a Special Meeting of Stockholders held
on January 19, 2007. As a result of the acquisition, stockholders of AWG
received shares of the Fund equivalent to the aggregate net asset value of the
shares they held in AWG. Stockholders participating in AWG's dividend
reinvestment plan received full and fractional shares of the Fund. Other
stockholders received cash in lieu of fractional shares.
On April 12, 2007, the aggregate net assets of the Fund and AWG were
$1,001,169,926 and $128,756,589, respectively. As of the close of business on
April 13, 2007, the combined net assets of the Fund amounted to $1,129,600,816.
ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND o 39
FINANCIAL HIGHLIGHTS
Selected Data For A Share Of Common Stock Outstanding Throughout Each Period
Year Ended March 31,
------------------------------------------------------------
2007 2006 2005 2004(a) 2003
------------------------------------------------------------
Net asset value,
beginning of period $14.54 $13.55 $13.59 $11.42 $10.58
Income From Investment
Operations
Net investment income(b) .91 .90 .87 .99 1.07
Net realized and unrealized
gain (loss) on investment
transactions .72 .99 (.08) 2.36 .83
Net increase in net asset
value from operations 1.63 1.89 .79 3.35 1.90
Less: Dividends
Dividends from net
investment income (.98) (.90) (.83) (1.18) (1.06)
Net asset value, end of period $15.19 $14.54 $13.55 $13.59 $11.42
Market value, end of period $13.85 $12.59 $11.80 $12.91 $10.91
Discount (8.82)% (13.41)% (12.92)% (5.00)% (4.47)%
Total Return
Total investment return based on:(c)
Market value 18.52% 14.62% (1.96)% 29.27% 17.72%
Net asset value 12.55% 15.28% 6.94% 30.01% 20.20%
Ratios/Supplemental Data
Net assets, end of period
(000's omitted) $1,027,252 $983,788 $916,838 $919,453 $889,435
Ratio to average net assets of:
Expenses 1.68% 1.23% 1.30% 1.29% 1.49%
Expenses, excluding
interest expense 1.06% 1.15% 1.28% 1.25% 1.35%
Net investment income 6.24% 6.33% 6.50% 7.65% 10.53%
Portfolio turnover rate 68% 79% 147% 158% 121%
See footnote summary on page 41.
40 o ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND
(a) As of April 1, 2003, the Fund has adopted the method of accounting for
interim payments on swap contracts in accordance with Financial Accounting
Standards Board Statement No. 133. These interim payments are reflected within
net realized and unrealized gain (loss) on swap contracts, however prior to
April 1, 2003, these interim payments were reflected within interest
income/expense on the statement of operations. The effect of this change for
the year ended March 31, 2004, was to decrease net investment income per share
by $0.06 and increase net realized and unrealized gain (loss) on investment
transactions per share by $0.06, and decrease the ratios of net investment
income and expenses to average net assets by 0.50% and 0.20%, respectively.
(b) Based on average shares outstanding.
(c) Total investment return is calculated assuming a purchase of common stock
on the opening of the first day and a sale on the closing of the last day of
each period reported. Dividends and distributions, if any, are assumed, for
purposes of this calculation, to be reinvested at prices obtained under the
Fund's Dividend Reinvestment Plan. Generally, total investment return based on
net asset value will be higher than total investment return based on market
value in periods where there is an increase in the discount or a decrease in
the premium of the market value to the net asset value from the beginning to
the end of such periods. Conversely, total investment return based on net asset
value will be lower than total investment return based on market value in
periods where there is a decrease in the discount or an increase in the premium
of the market value to the net asset value from the beginning to the end of
such periods. Total investment return calculated for a period of less than one
year is not annualized.
ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND o 41
REPORT OF INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM
To the Shareholders and Board of Directors of
AllianceBernstein Global High Income Fund, Inc.
We have audited the accompanying statement of assets and liabilities of
AllianceBernstein Global High Income Fund, Inc., formerly Alliance World Dollar
Government Fund II, Inc., (the "Fund"), including the portfolio of investments,
as of March 31, 2007, and the related statement of operations and cash flows
for the year then ended, the statement of changes in net assets for each of the
two years in the period then ended and the financial highlights for each of the
five years in the period then ended. These financial statements and financial
highlights are the responsibility of the Fund's management. Our responsibility
is to express an opinion on these financial statements and financial highlights
based on our audits.
We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the
financial statements and financial highlights are free of material
misstatement. We were not engaged to perform an audit of the Fund's internal
control over financial reporting. Our audits included consideration of internal
control over financial reporting as a basis for designing audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Fund's internal control over financial
reporting. Accordingly, we express no such opinion. An audit also includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements and financial highlights, assessing the accounting
principles used and significant estimates made by management, and evaluating
the overall financial statement presentation. Our procedures included
confirmation of securities owned as of March 31, 2007 by correspondence with
the custodian and others, or by other appropriate auditing procedures where
replies from others were not received. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of
AllianceBernstein Global High Income Fund at March 31, 2007, the results of its
operations and cash flows for the year then ended, the changes in its net
assets for each of the two years in the period then ended and the financial
highlights for each of the five years in the period then ended, in conformity
with U.S. generally accepted accounting principles.
/s/ Ernst & Young LLP
New York, New York
May 18, 2007
42 o ALLIANCEBERNSTEIN GLOBAL
HIGH INCOME FUND
TAX INFORMATION
(unaudited)
2.3% of the ordinary income dividends paid by the Fund during the fiscal year
ended March 31, 2007 qualify as "interest related dividends" for non-U.S.
shareholders.
ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND o 43
ADDITIONAL INFORMATION
(unaudited)
AllianceBernstein Global High Income Fund
Shareholders whose shares are registered in their own names may elect to be
participants in the Dividend Reinvestment Plan (the "Plan"), pursuant to which
distributions to shareholders will be paid in or reinvested in additional
shares of the Fund. Computershare Trust Company N.A. (the "Agent") will act as
agent for participants under the Plan. Shareholders whose shares are held in
the name of a broker or nominee should contact such broker or nominee to
determine whether or how they may participate in the Plan.
If the Board declares a distribution payable either in shares or in cash, as
holders of the Common Stock may have elected, non-participants in the Plan will
receive cash and participants in the Plan will receive the equivalent in shares
of Common Stock of the Fund valued as follows:
(i) If the shares of Common Stock are trading at net asset value or at a
premium above net asset value at the time of valuation, the Fund will issue new
shares at the greater of net asset value or 95% of the then current market
price.
(ii) If the shares of Common Stock are trading at a discount from net asset
value at the time of valuation, the Agent will receive the distribution in cash
and apply it to the purchase of the Fund's shares of Common Stock in the open
market on the New York Stock Exchange or elsewhere, for the participants'
accounts. Such purchases will be made on or shortly after the payment date for
such distribution and in no event more than 30 days after such date except
where temporary curtailment or suspension of purchase is necessary to comply
with Federal securities laws. If, before the Agent has completed its purchases,
the market price exceeds the net asset value of a share of Common Stock, the
average purchase price per share paid by the Agent may exceed the net asset
value of the Fund's shares of Common Stock, resulting in the acquisition of
fewer shares than if the distribution had been paid in shares issued by the
Fund.
The Agent will maintain all shareholders' accounts in the Plan and furnish
written confirmation of all transactions in the account, including information
needed by shareholders for tax records. Shares in the account of each Plan
participant will be held by the Agent in non-certificate form in the name of
the participant, and each shareholder's proxy will include those shares
purchased or received pursuant to the Plan.
There will be no charges with respect to shares issued directly by the Fund to
satisfy the dividend reinvestment requirements. However, each participant will
pay a pro rata share of brokerage commissions incurred with respect to the
Agent's open market purchases of shares. In each case, the cost per share of
shares purchased for each shareholder's account will be the average cost,
including brokerage commissions, of any shares purchased in the open market
plus the cost of any shares issued by the Fund.
44 o ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND
The automatic reinvestment of distributions will not relieve participants of
any income taxes that may be payable (or required to be withheld) on
distributions.
Experience under the Plan may indicate that changes are desirable. Accordingly,
the Fund reserves the right to amend or terminate the Plan as applied to any
distribution paid subsequent to written notice of the change sent to
participants in the Plan at least 90 days before the record date for such
distribution. The Plan may also be amended or terminated by the Agent on at
least 90 days' written notice to participants in the Plan. All correspondence
concerning the Plan should be directed to the Agent at Computershare Trust
Company N.A., P.O. Box 43010, Providence, RI 02940-3010.
ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND o 45
RESULTS OF SHAREHOLDERS MEETING
(unaudited)
A Special Meeting of the Stockholders of AllianceBernstein Global High Income
Fund, Inc. (the "Fund") was held on December 12, 2006. At the Meeting, with
respect to the proposal to eliminate the Fund's fundamental investment policy
to invest at least 65% of its assets in U.S. Dollar-denominated sovereign debt
obligations, the required number of outstanding shares were voted in favor of
the proposal, and the proposal was approved. A description of the proposal and
number of shares voted at the Meeting are as follows:
Voted
Voted For Against Abstained
----------------------------------------
1. The elimination of the Fund's 31,024,512 2,472,264 1,619,697
fundamental investment policy to
invest at least 65% of its assets
in U.S. Dollar-denominated sovereign
debt obligations.
ADDITIONAL INFORMATION
(unaudited)
Supplemental Proxy Information
The Annual Meeting of Stockholders of the AllianceBernstein Global High Income
Fund, Inc. was held on March 28, 2007 and adjourned to May 4, 2007.
A description of each proposal and number of shares voted at the meeting are as
follows:
Abstain/
Authority
Voted for Withheld
--------------------------
1. To elect Class One directors:
(term expires in 2010) David H. Dievler 61,964,003 1,190,592
Michael J. Downey 62,028,242 1,126,354
Nancy P. Jacklin 62,045,863 1,108,732
2. To elect a Class Three director:
(terms expire in 2009) Earl D. Weiner 62,016,928 1,137,667
46 o ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND
BOARD OF DIRECTORS
William H.Foulk, Jr.(1), Chairman
Marc O.Mayer, President and Chief Executive Officer
David H. Dievler(1)
John H. Dobkin(1)
Michael J. Downey(1)
D. James Guzy(1)
Nancy P. Jacklin(1)
Marshall C. Turner, Jr.(1)
Earl D. Weiner(1)
OFFICERS
Philip L. Kirstein, Senior Vice President and Independent Compliance Officer
Paul J. DeNoon(2), Vice President
Emilie D. Wrapp, Secretary
Joseph J. Mantineo, Treasurer and Chief Financial Officer
Vincent S. Noto, Controller
Administrator
AllianceBernstein, L.P.
1345 Avenue of the Americas
New York, NY 10105
Custodian
The Bank of New York
One Wall Street
New York, NY 10286
Dividend Paying Agent,
Transfer Agent and Registrar
Computershare Trust Company, N.A.
P.O. Box 43010
Providence, RI 02940-3010
Independent Registered Public
Accounting Firm
Ernst & Young LLP
5 Times Square
New York, NY 10036
Legal Counsel
Seward & Kissel LLP
One Battery Park Plaza
New York, NY 10004
(1) Member of the Audit Committee, the Governance and Nominating Committee,
and the Independent Directors Committee.
(2) The day-to-day management of, and investment decisions for, the Fund's
portfolio are made by the Global Fixed Income Emerging Market Investment Team.
While all members of the team work jointly to determine the majority of the
investment strategy including stock selection for the Fund, Messrs. Paul J.
DeNoon, Fernando Grisales, Michael Mon, Douglas Peebles and Matthew Sheridan,
members of the Global Fixed Income Emerging Market Investment Team, are
primarily responsible for the day-to-day management of the Fund's portfolio.
Notice is hereby given in accordance with Section 23(c) of the Investment
Company Act of 1940 that the Fund may purchase at market prices from
time-to-time shares of its Common Stock in the open market.
This report, including the financial statements therein, is transmitted to the
shareholders of AllianceBernstein Global High Income Fund for their
information. This is not a prospectus, circular or representation intended for
use in the purchase of shares of the Fund or any securities mentioned in this
report.
Annual Certifications - As required, on April 26, 2007, the Fund submitted to
the New York Stock Exchange ("NYSE") the annual certification of the Fund's
Chief Executive Officer certifying that he is not aware of any violation of the
NYSE's Corporate Governance listing standards. The Fund also has included the
certifications of the Fund's Chief Executive Officer and Chief Financial
Officer required by Section 302 of the Sarbanes-Oxley Act of 2002 as exhibits
to the Fund's Form N-CSR filed with the Securities and Exchange Commission for
the annual period.
ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND o 47
MANAGEMENT OF THE FUND
Board of Directors Information
The business and affairs of the Fund are managed under the direction of the
Board of Directors. Certain information concerning the Fund's Directors is set
forth below.
PORTFOLIOS
PRINCIPAL IN FUND OTHER
NAME, ADDRESS, OCCUPATION(S) COMPLEX DIRECTORSHIP
AGE, DURING PAST OVERSEEN BY HELD BY
(YEAR ELECTED**) 5 YEARS DIRECTOR DIRECTOR
---------------------------------------------------------------------------------------------------------------------
INTERESTED DIRECTOR
Marc O. Mayer, + Executive Vice President of 107 SCB Partners,
1345 Avenue of the AllianceBernstein L.P. (the Inc. and SCB
Americas "Adviser") since prior to 2002 and Inc.
New York, NY 10105 Executive Managing Director of
49 AllianceBernstein Investments, Inc.
(2003) ("ABI") since 2003; prior thereto
he was head of AllianceBernstein
Institutional Investments, a unit
of the Adviser, from 2001-2003.
Prior thereto, Chief Executive Officer
of Sanford C. Bernstein & Co., LLC
(institutional research and brokerage
arm of Bernstein & Co. LLC and its
predecessor since prior to 2002.
DISINTERESTED DIRECTORS
William H. Foulk, Jr., # Investment Adviser and an 109 None
Chairman of the Board Independent Consultant. He
74 was formerly Senior Manager
(1993) of Barrett Associates, Inc., a
registered investment adviser,
with which he had been
associated since prior to 2002. He
was formerly Deputy Comptroller
and Chief Investment Officer of
the State of New York and, prior
thereto, Chief Investment Officer
of the New York Bank for Savings.
David H. Dievler, # Independent Consultant. Until 108 None
77 December 1994 he was Senior
(1993) Vice President of AllianceBernstein
Corporation ("AB Corp.", formerly
Alliance Capital Management
Corporation ("ACMC")) responsible
for mutual fund administration.
Prior to joining AB Corp. in 1984,
he was Chief Financial Officer of
Eberstadt Asset Management
since 1968. Prior to that, he
was a Senior Manager at Price
Waterhouse & Co. Member of
American Institute of Certified
Public Accountants since 1953.
48 o ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND
PORTFOLIOS
PRINCIPAL IN FUND OTHER
NAME, ADDRESS, OCCUPATION(S) COMPLEX DIRECTORSHIP
AGE, DURING PAST OVERSEEN BY HELD BY
(YEAR ELECTED**) 5 YEARS DIRECTOR DIRECTOR
---------------------------------------------------------------------------------------------------------------------
DISINTERESTED DIRECTORS
(continued)
John H. Dobkin, # Consultant. Formerly President of 107 None
65 Save Venice, Inc. (preservation
(1993) organization) from 2001-2002, a
Senior Advisor from June 1999-
June 2000 and President of Historic
Hudson Valley (historic preservation)
from December 1989-May 1999.
Previously, Director of the National
Academy of Design and during
1988-1992, Director and Chairman
of the Audit Committee of AB Corp.
Michael J. Downey, # Consultant since January 2004. 107 Asia Pacific
63 Formerly managing partner of Fund, Inc.
(2005) Lexington Capital, LLC (investment and The
advisory firm) from December 1997 Merger Fund
until December 2003. Prior thereto,
Chairman and CEO of Prudential
Mutual Fund Management from 1987
to 1993.
D. James Guzy, # Chairman of the Board of PLX 107 Intel
71 Technology (semi-conductors) and Corporation
(2005) of SRC Computers Inc., with which (semi-conductors)
he has been associated since prior to and Cirrus Logic
2002. He is also President of the Arbor Corporation
Company (private family investments). (semi-conductors)
Nancy P. Jacklin, # Formerly US Executive Director of 107 None
59 the International Monetary Fund
(2006) (December 2002-May 2006); Partner,
Clifford Chance (1992-2002); Senior
Counsel, International Banking and
Finance, and Associate General Counsel,
Citicorp (1985-1992); Assistant General
Counsel (International), Federal Reserve
Board of Governors (1982-1985); and
Attorney Advisor, US Department of
the Treasury (1973-1982). Member of
the Bar of the District of Columbia and
of New York; member of the Council
on Foreign Relations.
ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND o 49
PORTFOLIOS
PRINCIPAL IN FUND OTHER
NAME, ADDRESS, OCCUPATION(S) COMPLEX DIRECTORSHIP
AGE, DURING PAST OVERSEEN BY HELD BY
(YEAR ELECTED**) 5 YEARS DIRECTOR DIRECTOR
---------------------------------------------------------------------------------------------------------------------
DISINTERESTED DIRECTORS
(continued)
Marshall C. Turner, Jr. Consultant. Formerly President and 107 Xilinx, Inc.
65 CEO, Toppan Photomasks, Inc. (semi-conductors),
(2005) (semi-conductor manufacturing and MEMC
services), 2005-2006, and Chairman Electronic Materials,
and CEO from 2003 until 2005, when Inc. (semi-conductor
the company was acquired and substrates)
re-named from Dupont Photomasks,
Inc. Principal, Turner Venture Associates
(venture capital and consulting), 1993-
2003.
Earl D. Weiner, # Of-counsel, and Partner from 106 None
67 1976-2006, of the law firm Sullivan
(2007) & Cromwell LLP, specializing in
investment management, corporate
and securities law; member of ABA
Federal Regulation of Securities
Committee Task Force on Fund
Director's Guidebook.
* The address of each of the Fund's disinterested Directors is
c/o AllianceBernstein L.P., Attn: Philip L. Kirstein, 1345 Avenue
of the Americas, New York, NY 10105.
** There is no stated term of office for the Fund's Directors.
## Member of the Audit Committee, the Independent Directors Committee and the
Governance and Nominating Committee.
+ Mr. Mayer is an "interested person", as defined in the 1940 Act, due to his
position as an Executive Vice President of the Adviser.
50 o ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND
Officer Information
Certain information concerning the Fund's Officers is listed below.
NAME, ADDRESS* POSITION(S) PRINCIPAL OCCUPATION
AND AGE HELD WITH FUND DURING PAST 5 YEARS
--------------------------------------------------------------------------------------------------------------
Marc O. Mayer, President and Chief See biography above.
49 Executive Officer
Philip L. Kirstein, Senior Vice President Senior Vice President and Independent
62 and Independent Compliance Officer of the
Compliance Officer AllianceBernstein Funds, with which he
has been associated since October 2004.
Prior thereto, he was Of Counsel
to Kirkpatrick & Lockhart, LLP from
October 2003 to October 2004,
and General Counsel of Merrill Lynch
Investment Managers, L.P. since prior
to 2002 until March 2003.
Paul J. DeNoon, Vice President Senior Vice President of the Adviser**,
45 with which he has been associated
since prior to 2002.
Emilie D. Wrapp, Secretary Senior Vice President, Assistant
51 General Counsel and Assistant
Secretary of ABI**, with which she has
been associated since prior to 2002.
Joseph J. Mantineo Treasurer and Chief Senior Vice President of
48 Financial Officer AllianceBernstein Investor Services, Inc.
("ABIS")**, with which he has been
associated since prior to 2002.
Vincent S. Noto, Controller Vice President of ABIS**, with which
42 he has been associated since prior
to 2002.
* The address for each of the Fund's Officers is 1345 Avenue of the Americas,
New York, NY 10105.
** The Adviser, ABI and ABIS are affiliates of the Fund.
ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND o 51
SUMMARY OF GENERAL INFORMATION
The daily net asset value of the Fund's shares is available from the Fund's
Transfer Agent by calling (800) 219-4218. The Fund also distributes its daily
net asset value (NAV) to various financial publications or independent
organizations such as Lipper, Inc., Morningstar, Inc. and Bloomberg. The Fund's
NYSE trading symbol is "AWF." Weekly comparative net asset value and market
price information about the Fund is published each Monday in The Wall Street
Journal, each Sunday in The New York Times and each Saturday in Barron's and
other newspapers in a table called "Closed-End Funds."
Information Regarding New or Amended Investment Policies
The Fund's Board of Directors recently approved a broader investment policy
that permits the Fund to invest in other investment companies to the full
extent permitted by the Investment Company Act of 1940 (the "1940 Act") and the
rules thereunder. The Board of Directors also approved the Fund's investments
of uninvested cash balances in an affiliated money market fund as permitted by
Rule 12d1-1 under the 1940 Act.
Dividend Reinvestment Plan
If your shares are held in your own name, you will automatically be a
participant in the Plan unless you elect to receive cash. If your shares are
held in nominee or street name through a broker or nominee who provides this
service, you will also automatically be a participant in the Plan. If your
shares are held in the name of a broker or nominee who does not provide this
service, you will need to instruct them to participate in the Plan on your
behalf or your distributions will not be reinvested. In such case, you will
receive your distributions in cash.
For questions concerning shareholder account information, or if you would like
a brochure describing the Divi-dend Reinvestment Plan, please call
Computershare Trust Company, N.A. at (800) 219-4218.
52 o ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND
Information Regarding the Review and Approval of the Fund's Advisory and
Administration Agreements
The Fund's disinterested directors (the "directors") unanimously approved the
continuance of the Advisory Agreement between the Fund and the Adviser and the
continuance of the Administration Agreement between the Adviser (in such
capacity, the "Administrator") and the Fund at a meeting held on October
31-November 2, 2006.
In preparation for the meeting, the directors had requested from the Adviser
and received and evaluated extensive materials, including performance and
expense information for other investment companies with similar investment
objectives derived from data compiled by Lipper Inc. ("Lipper"), which is not
affiliated with the Adviser. Prior to voting, the directors reviewed the
proposed continuance of the Advisory Agreement and Administration Agreement
with management and with experienced counsel who are independent of the Adviser
and received a memorandum from such counsel discussing the legal standards for
their consideration of the proposed continuance. The directors also discussed
the proposed continuance in three private sessions at which only the directors,
their independent counsel and the Fund's Independent Compliance Officer were
present. In reaching their determinations relating to continuance of the
Advisory Agreement and the Administration Agreement, the directors considered
all factors they believed relevant, including the following:
1. information comparing the performance of the Fund to other investment
companies with similar investment objectives and to an index;
2. the nature, extent and quality of investment, compliance, administrative
and other services rendered by the Adviser;
3. payments received by the Adviser from all sources in respect of the Fund
and all investment companies in the AllianceBernstein Funds complex;
4. the costs borne by, and profitability of, the Adviser and its affiliates in
providing services to the Fund and to all investment companies in the
AllianceBernstein Funds complex;
5. comparative fee and expense data for the Fund and other investment
companies with similar investment objectives;
6. the extent to which economies of scale would be realized to the extent the
Fund grows and whether fee levels reflect any economies of scale for the
benefit of investors;
ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND o 53
7. the Adviser's policies and practices regarding allocation of portfolio
transactions of the Fund;
8. portfolio turnover rates for the Fund compared to other investment
companies with similar investment objectives;
9. fall-out benefits which the Adviser and its affiliates receive from their
relationships with the Fund;
10. the Adviser's representation that there are no institutional products
managed by the Adviser which have a substantially similar investment style as
the Fund;
11. the professional experience and qualifications of the Fund's portfolio
management team and other senior personnel of the Adviser;
12. the terms of the Advisory Agreement; and
13. the terms of the Administration Agreement.
The directors also considered their knowledge of the nature and quality of the
services provided by the Adviser to the Fund gained from their experience as
directors or trustees of most of the registered investment companies advised by
the Adviser, their overall confidence in the Adviser's integrity and competence
they have gained from that experience and the Adviser's responsiveness to
concerns raised by them in the past, including the Adviser's willingness to
consider and implement organizational and operational changes designed to
improve investment results and the services provided to the AllianceBernstein
Funds.
In their deliberations, the directors did not identify any particular
information that was all-important or controlling, and different directors may
have attributed different weights to the various factors.
The directors determined that the overall arrangements (i) between the Fund and
the Adviser, as provided in the Advisory Agreement, and (ii) between the Fund
and the Administrator, as provided in the Administration Agreement, were fair
and reasonable in light of the services performed, expenses incurred and such
other matters as the directors considered relevant in the exercise of their
business judgment.
The material factors and conclusions that formed the basis for the directors
reaching their determinations to approve the continuance of the Advisory
Agreement and Administration Agreement (including their determinations that the
Adviser should continue to be the investment adviser for the Fund, that the
Administrator should continue to be the administrator for the Fund, and that
the
54 o ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND
fees payable to the Adviser pursuant to the Advisory Agreement, and to the
Administrator pursuant to the Administration Agreement, are appropriate) were
separately discussed by the directors.
Nature, Extent and Quality of Services Provided by the Adviser
The directors noted that, under the Advisory Agreement, the Adviser, subject to
the oversight of the directors, administers the Fund's business and other
affairs. The Adviser manages the investment of the assets of the Fund,
including making purchases and sales of portfolio securities consistent with
the Fund's investment objective and policies. The Adviser also provides the
Fund with such office space, administrative and other services (exclusive of,
and in addition to, any such services provided by any others retained by the
Fund) and executive and other personnel as are necessary for the Fund's
operations. The Adviser pays all of the compensation of directors of the Fund
who are affiliated persons of the Adviser and of the officers of the Fund.
The directors noted that the Advisory Agreement for the Fund does not contain a
reimbursement provision for the cost of certain administrative and other
services provided by the Adviser. The directors noted that under the
Administration Agreement, the Administrator, subject to the supervision of the
directors, provides the following services: (a) oversees the determination and
publication of the Fund's net asset value; (b) oversees the maintenance of the
books and records of the Fund; (c) arranges for bank or other borrowing by the
Fund, pursuant to the Adviser's determination of the lenders, timing, amount
and terms of any such borrowing; (d) prepares the Fund's federal, state and
local income tax returns; (e) prepares the financial information for the Fund's
proxy statements and reports to shareholders; (f) prepares the Fund's periodic
financial and other reports to regulatory agencies; (g) responds to or refers,
as appropriate, shareholder inquiries; (h) coordinates audit examinations; and
(i) conducts asset maintenance tests and prepares related reports. With respect
to (g) the directors noted that the Fund pays AllianceBernstein Investor
Services to respond to certain types of shareholder inquiries pursuant to a
Shareholder Inquiry Agency Agreement.
The directors considered the scope and quality of services provided by the
Adviser under the Advisory Agreement and by the Administrator under the
Administration Agreement and noted that the scope of services provided by
advisers and administrators of funds had expanded over time as a result of
regulatory and other developments. The directors noted that, for example, the
Adviser (including in its capacity as Administrator of the Fund) is responsible
for maintaining and monitoring its own and, to varying degrees, the Fund's
compliance programs, and these compliance programs have recently been refined
and enhanced in light of new regulatory requirements. The directors considered
the quality of the in-house investment research capabilities of the Adviser and
the other resources it has dedicated to performing services for the Fund. The
quality
ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND o 55
of administrative and other services, including the Adviser's role in
coordinating the activities of the Fund's other service providers, also were
considered. The directors also considered the Adviser's response to recent
regulatory compliance issues affecting a number of the investment companies in
the AllianceBernstein Funds complex. The directors concluded that, overall,
they were satisfied with the nature, extent and quality of services provided to
the Fund under the Advisory Agreement and the Administration Agreement.
Costs of Services Provided and Profitability to the Adviser
The directors reviewed a schedule of the revenues, expenses and related notes
indicating the profitability of the Fund to the Adviser (including in its
capacity as Administrator) for calendar years 2004 and 2005 that had been
prepared with an updated expense allocation methodology arrived at in
consultation with an independent consultant. The directors noted that the
updated methodology differed in various respects from the methodology used in
prior years. The directors reviewed the assumptions and methods of allocation
used by the Adviser in preparing fund-specific profitability data, and noted
the Adviser's representation to them that it believed that the methods of
allocation used in preparing the profitability information were reasonable and
appropriate and that the Adviser had previously discussed with the directors
that there is no generally accepted allocation methodology for information of
this type.
The directors recognized that it is difficult to make comparisons of
profitability from fund advisory contracts because comparative information is
not generally publicly available and is affected by numerous factors, including
the structure of the particular adviser, the types of funds it manages, its
business mix, numerous assumptions regarding allocations and the adviser's
capital structure and cost of capital. In considering profitability
information, the directors considered the effect of fall-out benefits on the
Adviser's expenses. The directors focused on the profitability of the Adviser's
relationship with the Fund before taxes. The directors recognized that the
Adviser should generally be entitled to earn a reasonable level of profits for
the services it provides to the Fund and, based on their review, concluded that
they were satisfied that the Adviser's level of profitability from its
relationship with the Fund was not excessive.
Fall-Out Benefits
The directors considered that the Adviser benefits from soft dollar
arrangements whereby it receives brokerage and research services from many of
the brokers and dealers that execute purchases and sales of securities on
behalf of its clients on an agency basis. The directors noted that since the
Fund does not engage in brokerage transactions, the Adviser does not receive
soft dollar benefits in respect of portfolio transactions of the Fund. The
directors also noted that a subsidiary of the Adviser provides certain
shareholder services to the Fund and receives compensation from the Fund for
such services.
56 o ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND
The directors recognized that the Adviser's profitability would be somewhat
lower if the Adviser's subsidiary did not receive the benefits described above.
The directors understood that the Adviser also might derive reputational and
other benefits from its association with the Fund.
Investment Results
In addition to the information reviewed by the directors in connection with the
meeting, the directors receive detailed comparative performance information for
the Fund at each regular Board meeting during the year. At the meeting, the
directors reviewed information prepared by the Adviser based on information
obtained from Lipper showing performance of the Fund as compared to other funds
in the Lipper Emerging Markets Debt Funds Average (the "Lipper Average") for
periods ended June 30, 2006 over the year to date ("YTD"), 1-, 3-, 5- and
10-year and since inception periods (inception July 1993) and for each of the
last ten calendar years, and as compared to the JP Morgan Emerging Markets Bond
Index Global (the "Index") for periods ended June 30, 2006 over the YTD, 1-,
3-, 5- and 10-year periods (information was not available for the since
inception period). The directors noted that in the Lipper Average comparison
(13 funds in the YTD period, including the Fund and Alliance World Dollar
Government Fund, Inc., another closed-end fund advised by the Adviser), the
Fund's performance was somewhat above the Lipper median in the YTD and since
inception periods, materially above the Lipper median in the 5- and 10-year
periods, somewhat below the Lipper median in the 1-year period and materially
below the Lipper median in the 3-year period, and that the Fund's calendar year
performance was significantly above the Lipper median in 2002 and 2005,
slightly above the Lipper median in 2003, materially above the Lipper median in
1997, 1999 and 2000, somewhat below the Lipper median in 2004 and significantly
below the Lipper median in 1996, 1998 and 2001. The directors further noted
that the Fund outperformed the Index in all periods reviewed. Based on their
review, the directors concluded that the Fund's relative performance over time
was satisfactory.
Advisory Fees and Other Expenses
The directors considered the latest fiscal period actual management fees paid
by the Fund (advisory fees paid to the Adviser and administration fees paid to
the Adviser (in its capacity as Administrator of the Fund)) and information
prepared by Lipper concerning fee rates paid by other funds in the same Lipper
category as the Fund. They compared the combined advisory and administration
fees paid by the Fund to the advisory fees of other funds where there is no
separate administrator. The directors recognized that it is difficult to make
comparisons of advisory fees because there are variations in the services that
are included in the fees paid by other funds.
The directors noted that in connection with the settlement of the market timing
matter with the New York Attorney General in December 2003, the Adviser
ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND o 57
agreed to material reductions (averaging 20%) in the fee schedules of most of
the open-end funds sponsored by the Adviser and that such open-end funds had
benefited from such reductions since 2004. The directors noted that the Fund's
contractual advisory fee rate was higher than the fee rate charged to an
open-end emerging market debt fund managed by the Adviser, and that the Fund's
fee rate exceeded the rate paid by the open-end fund prior to the settlement
related reduction. The directors further noted that, at their September 14 and
16, 2005 meeting, the directors considered and approved the Adviser's proposal,
in response to the directors' request for advisory and administration fee
reductions, to amend the Advisory Agreement effective October 1, 2005 to reduce
the fee rate by 10 basis points (from 1.00% to 0.90%) and the Administrator's
proposal to replace the 15 basis points fee in the Administration Agreement
with an amount equal to no more than the cost to the Administrator of providing
administrative services subject to a maximum of 15 basis points.
The Adviser informed the directors that there are no institutional products
offered by it that have a substantially similar investment style as the Fund.
The directors reviewed information in the Adviser's Form ADV and noted that it
charges institutional clients lower fees for advising comparably sized accounts
using strategies that differ from those of the Fund but which involve
investments in securities of the same type that the Fund invests in (i.e.,
emerging market fixed income).
The Adviser reviewed with the directors the significant differences in the
scope of services it provides to institutional clients and to the Fund. For
example, the Advisory Agreement requires the Adviser to provide, in addition to
investment advice, office facilities and officers (including officers to
provide required certifications). The Adviser also coordinates the provision of
services to the Fund by non-affiliated service providers and is responsible for
the compensation of the Fund's Independent Compliance Officer and certain
related expenses. The provision of these non-advisory services involves costs
and exposure to liability. The Adviser explained that many of these services
normally are not provided to non-investment company clients and that fees
charged to the Fund reflect the costs and risks of the additional obligations.
In light of these facts, the directors did not place significant weight on
these fee comparisons.
In evaluating the Adviser's proposal, the directors took into account the fact
that the Fund utilizes leverage and that as a result the Fund's assets that the
Adviser invests and reinvests are materially greater than its net assets.
However, the advisory fee is calculated based on the Fund's net assets. The
directors noted that many leveraged funds pay advisory fees based on "adjusted
net assets" which results in such funds paying advisory fees on the assets
supported by leverage, and that if the advisory fee paid by the Fund was
expressed as a percentage of its adjusted net assets the fee rate would be
materially lower than the rate stated in the Advisory Agreement.
58 o ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND
The directors also considered the total expense ratio of the Fund in comparison
to the fees and expenses of funds within two comparison groups created by
Lipper: an Expense Group and an Expense Universe. Lipper described an Expense
Group as a representative sample of comparable funds and an Expense Universe as
a broader group, consisting of all funds in the Fund's investment
classification/objective with a similar load type as the Fund. The directors
noted that because of the small number of funds in the Fund's Lipper category,
at the request of the Adviser and the Fund's Senior Officer, Lipper expanded
the Expense Group and Expense Universe of the Fund to include funds that are
allowed to utilize leverage but do not do so. The expense ratio of the Fund was
based on the Fund's latest fiscal year expense ratio. The Lipper information
included the pro forma expense ratio provided by the Adviser assuming the new
lower contractual advisory and administration fees effective October 1, 2005
had been in effect throughout fiscal 2006. All references to expense ratios are
to the pro forma expense ratio. The directors recognized that the expense ratio
information for the Fund potentially reflected on the Adviser's provision of
services, as the Adviser is responsible for coordinating services provided to
the Fund by others. The directors noted that the expense ratios of some funds
in the Fund's Lipper category also were lowered by waivers or reimbursements by
those funds' investment advisers, which in some cases were voluntary and
perhaps temporary.
The information reviewed by the directors showed that the Fund's latest fiscal
period actual management fees of 91.1 basis points (the pro forma combined
advisory and administration fees paid under the Advisory and Administration
Agreements) were materially lower than the Expense Group and Expense Universe
medians. The directors also noted that the Fund's pro forma total expense ratio
(which, they noted, benefited from the Fund's relatively large size) was
significantly lower than the Expense Group and Expense Universe medians. The
directors concluded that the Fund's expense ratio was satisfactory.
Economies of Scale
The directors considered that the Fund is a closed-end Fund and that it was not
expected to have meaningful asset growth as a result. In such circumstances,
the directors did not view the potential for realization of economies of scale
as the Fund's assets grow to be a material factor in their deliberations. The
directors noted that if the Fund's net assets were to increase materially as a
result of, e.g., an acquisition or rights offering, they would review whether
potential economies of scale would be realized. In this regard the directors
took account of the fact that it was proposed that the Fund's net assets be
increased modestly by the acquisition of a much smaller fund, Alliance World
Dollar Government Fund, Inc.
ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND o 59
THIS PAGE IS NOT PART OF THE SHAREHOLDER REPORT OR THE FINANCIAL STATEMENTS
ALLIANCEBERNSTEIN FAMILY OF FUNDS
--------------------------------------------
Wealth Strategies Funds
--------------------------------------------
Balanced Wealth Strategy
Wealth Appreciation Strategy
Wealth Preservation Strategy
Tax-Managed Balanced Wealth Strategy
Tax-Managed Wealth Appreciation Strategy
Tax-Managed Wealth Preservation Strategy
--------------------------------------------
Blended Style Funds
--------------------------------------------
U.S. Large Cap Portfolio
International Portfolio
Tax-Managed International Portfolio
--------------------------------------------
Growth Funds
--------------------------------------------
Domestic
Growth Fund
Mid-Cap Growth Fund
Large Cap Growth Fund
Small Cap Growth Portfolio
Global & International
Global Health Care Fund
Global Research Growth Fund
Global Technology Fund
Greater China '97 Fund
International Growth Fund
International Research Growth Fund
--------------------------------------------
Value Funds
--------------------------------------------
Domestic
Balanced Shares
Focused Growth & Income Fund
Growth & Income Fund
Small/Mid Cap Value Fund
Utility Income Fund
Value Fund
Global & International
Global Real Estate Investment Fund*
Global Value Fund
International Value Fund
--------------------------------------------
Taxable Bond Funds
--------------------------------------------
Global Government Income Trust
Corporate Bond Portfolio
Emerging Market Debt Fund
Global Strategic Income Trust
High Yield Fund
Intermediate Bond Portfolio
Short Duration Portfolio
U.S. Government Portfolio
--------------------------------------------
Municipal Bond Funds
--------------------------------------------
National Michigan
Insured National Minnesota
Arizona New Jersey
California New York
Insured California Ohio
Florida Pennsylvania
Massachusetts Virginia
--------------------------------------------
Intermediate Municipal Bond Funds
--------------------------------------------
Intermediate California
Intermediate Diversified
Intermediate New York
--------------------------------------------
Closed-End Funds
--------------------------------------------
All-Market Advantage Fund
AllianceBernstein Global High Income Fund*
AllianceBernstein Income Fund*
AllianceBernstein National Municipal Income Fund*
ACMManaged Dollar Income Fund
ACM Managed Income Fund
California Municipal Income Fund
New York Municipal Income Fund
The Spain Fund
--------------------------------------------
Retirement Strategies Funds
--------------------------------------------
2000 Retirement Strategy
2005 Retirement Strategy
2010 Retirement Strategy
2015 Retirement Strategy
2020 Retirement Strategy
2025 Retirement Strategy
2030 Retirement Strategy
2035 Retirement Strategy
2040 Retirement Strategy
2045 Retirement Strategy
We also offer Exchange Reserves,** which serves as the money market fund
exchange vehicle for the AllianceBernstein mutual funds.
You should consider the investment objectives, risks, charges and expenses of
any AllianceBernstein fund/portfolio carefully before investing. For free
copies of our prospectuses, which contain this and other information, visit us
online at www.alliancebernstein.com or contact your financial advisor. Please
read the prospectus carefully before investing.
* Prior to January 26, 2007, AllianceBernstein Global High Income Fund was
named Alliance World Dollar Government Fund II and AllianceBernstein Income
Fund was named ACM Income Fund. Prior to March 1, 2007, Global Real Estate
Investment Fund was named Real Estate Investment Fund. Prior to May 18, 2007,
AllianceBernstein National Municipal Income Fund was named National Municipal
Income Fund.
** An investment in the Fund is not a deposit in a bank and is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency. Although the Fund seeks to preserve the value of your investment at
$1.00 per share, it is possible to lose money by investing in the Fund.
60 o ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND
Privacy Notice
AllianceBernstein, the AllianceBernstein Family of Funds and AllianceBernstein
Investments, Inc. (collectively, "AllianceBernstein" or "we") understand the
importance of maintaining the confidentiality of our customers' nonpublic
personal information. In order to provide financial products and services to
our customers efficiently and accurately, we may collect nonpublic personal
information about our customers from the following sources: (1) information we
receive from account documentation, including applications or other forms
(which may include information such as a customer's name, address, social
security number, assets and income) and (2) information about our customers'
transactions with us, our affiliates and others (including information such as
a customer's account balances and account activity).
It is our policy not to disclose nonpublic personal information about our
customers (or former customers) except to our affiliates, or to others as
permitted or required by law. From time to time, AllianceBernstein may disclose
nonpublic personal information that we collect about our customers (or former
customers), as described above, to non-affiliated third party providers,
including those that perform processing or servicing functions and those that
provide marketing services for us or on our behalf pursuant to a joint
marketing agreement that requires the third party provider to adhere to
AllianceBernstein's privacy policy. We have policies and procedures to
safeguard nonpublic personal information about our customers (or former
customers) which include: (1) restricting access to such nonpublic personal
information and (2) maintaining physical, electronic and procedural safeguards
that comply with federal standards to safeguard such nonpublic personal
information.
ALLIANCEBERNSTEIN GLOBAL HIGH INCOME FUND
1345 Avenue of the Americas
New York, NY 10105
(800) 221-5672
[LOGO]
ALLIANCEBERNSTEIN
INVESTMENTS
GHIF-0151-0307
ITEM 2. CODE OF ETHICS.
(a) The registrant has adopted a code of ethics that applies to its principal
executive officer, principal financial officer and principal accounting
officer. A copy of the registrant's code of ethics is filed herewith as
Exhibit 12(a)(1).
(b) During the period covered by this report, no material amendments were made
to the provisions of the code of ethics adopted in 2(a) above.
(c) During the period covered by this report, no implicit or explicit waivers
to the provisions of the code of ethics adopted in 2(a) above were granted.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
The registrant's Board of Directors has determined that independent directors
David H. Dievler and William H. Foulk, Jr. qualify as audit committee financial
experts.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
(a) - (c) The following table sets forth the aggregate fees billed by the
independent registered public accounting firm Ernst & Young LLP, for the
Fund's last two fiscal years for professional services rendered for: (i) the
audit of the Fund's annual financial statements included in the Fund's annual
report to stockholders; (ii) assurance and related services that are
reasonably related to the performance of the audit of the Fund's financial
statements and are not reported under (i), which include advice and education
related to accounting and auditing issues and quarterly press release review
(for those Funds that issue quarterly press releases), and preferred stock
maintenance testing (for those Funds that issue preferred stock); and (iii)
tax compliance, tax advice and tax return preparation.
Audit-Related
Audit Fees Fees Tax Fees
2006 56,000 4,960 8,800
2007 59,000 5,083 19,950
(d) Not applicable.
(e) (1) Beginning with audit and non-audit service contracts entered into on or
after May 6, 2003, the Fund's Audit Committee policies and procedures require
the pre-approval of all audit and non-audit services provided to the Fund by
the Fund's independent registered public accounting firm. The Fund's Audit
Committee policies and procedures also require pre-approval of all audit and
non-audit services provided to the Adviser and Service Affiliates to the
extent that these services are directly related to the operations or
financial reporting of the Fund.
(e) (2) All of the amounts for Audit Fees, Audit-Related Fees and Tax Fees in
the table under Item 4 (a) - (c) are for services pre-approved by the Fund's
Audit Committee.
(f) Not applicable.
(g) The following table sets forth the aggregate non-audit services provided to
the Fund, the Fund's Adviser and entities that control, are controlled by or
under common control with the Adviser that provide ongoing services to the
Fund, which include conducting an annual internal control report pursuant to
Statement on Auditing Standards No. 70 ("Service Affiliates"):
Total Amount of
Foregoing Column Pre-)
approved by the Audit
All Fees for Committee
Non-Audit Services (Portion Comprised of
Provided to the Audit Related Fees)
Portfolio, the Adviser (Portion Comprised of
and Service Affiliates Tax Fees
2006 484,715 [13,760]
(4,960)
(8,800)
2007 1,007,078 [158,704]
(138,754)
(19,950)
(h) The Audit Committee of the Fund has considered whether the provision of any
non-audit services not pre-approved by the Audit Committee provided by the
Fund's independent registered public accounting firm to the Adviser and
Service Affiliates is compatible with maintaining the auditor's independence.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
The registrant has a separately-designated standing audit committee established
in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934.
The audit committee members are as follows:
David H. Dievler Nancy P. Jacklin
John H. Dobkin D. James Guzy
Michael J. Downey Marshall C. Turner, Jr.
William H. Foulk, Jr. Earl D. Weiner
ITEM 6. SCHEDULE OF INVESTMENTS.
PPlease see Schedule of Investments contained in the Report to Shareholders
included under Item 1 of this Form N-CSR.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Statement of Policies and Procedures for
Proxy Voting
October 2006
1. Introduction
As a registered investment adviser, AllianceBernstein L.P.
("AllianceBernstein", "we" or "us") has a fiduciary duty to act solely in the
best interests of our clients. We recognize that this duty requires us to vote
client securities in a timely manner and make voting decisions that are in the
best interests of our clients. Consistent with these obligations, we will
disclose our clients' voting records only to them and as required by mutual
fund vote disclosure regulations. In addition, the proxy committees may, after
careful consideration, choose to respond to surveys regarding past votes.
This statement is intended to comply with Rule 206(4)-6 of the Investment
Advisers Act of 1940. It sets forth our policies and procedures for voting
proxies for our discretionary investment advisory clients, including investment
companies registered under the Investment Company Act of 1940. This statement
applies to AllianceBernstein's growth, value and blend investment groups
investing on behalf of clients in both US and non-US securities.
2. Proxy Policies
This statement is designed to be responsive to the wide range of proxy voting
subjects that can have a significant effect on the investment value of the
securities held in our clients' accounts. These policies are not exhaustive
due to the variety of proxy voting issues that we may be required to consider.
AllianceBernstein reserves the right to depart from these guidelines in order
to avoid voting decisions that we believe may be contrary to our clients' best
interests. In reviewing proxy issues, we will apply the following general
policies:
2.1 Corporate Governance
AllianceBernstein's proxy voting policies recognize the importance of good
corporate governance in ensuring that management and the board of directors
fulfill their obligations to the shareholders. We favor proposals promoting
transparency and accountability within a company. We will vote for proposals
providing for equal access to the proxy materials so that shareholders can
express their views on various proxy issues. We also support the appointment
of a majority of independent directors on key committees and separating the
positions of chairman and chief executive officer. Finally, because we believe
that good corporate governance requires shareholders to have a meaningful voice
in the affairs of the company, we will support shareholder proposals that
request that companies amend their by-laws to provide that director nominees be
elected by an affirmative vote of a majority of the votes cast.
2.2 Elections of Directors
Unless there is a proxy fight for seats on the Board or we determine that there
are other compelling reasons for withholding votes for directors, we will vote
in favor of the management proposed slate of directors. That said, we believe
that directors have a duty to respond to shareholder actions that have received
significant shareholder support. We may withhold votes for directors (or vote
against in non-US markets) that fail to act on key issues such as failure to
implement proposals to declassify boards, failure to implement a majority vote
requirement, failure to submit a rights plan to a shareholder vote or failure
to act on tender offers where a majority of shareholders have tendered their
shares. In addition, we will withhold votes for directors who fail to attend
at least seventy-five percent of board meetings within a given year without a
reasonable excuse. Finally, we may abstain or vote against directors of
non-U.S. issuers where there is insufficient information about the nominees
disclosed in the proxy statement.
2.3 Appointment of Auditors
AllianceBernstein believes that the company remains in the best position to
choose the auditors and will generally support management's recommendation.
However, we recognize that there may be inherent conflicts when a company's
independent auditor performs substantial non-audit related services for the
company. The Sarbanes-Oxley Act of 2002 prohibited certain categories of
services by auditors to US issuers, making this issue less prevalent in the US.
Nevertheless, in reviewing a proposed auditor, we will consider the fees paid
for non-audit services relative to total fees as well as if there are other
reasons to question the independence of the auditors.
2.4 Changes in Legal and Capital Structure
Changes in a company's charter, articles of incorporation or by-laws are often
technical and administrative in nature. Absent a compelling reason to the
contrary, AllianceBernstein will cast its votes in accordance with the
company's management on such proposals. However, we will review and analyze on
a case-by-case basis any non-routine proposals that are likely to affect the
structure and operation of the company or have a material economic effect on
the company. For example, we will generally support proposals to increase
authorized common stock when it is necessary to implement a stock split, aid in
a restructuring or acquisition or provide a sufficient number of shares for an
employee savings plan, stock option or executive compensation plan. However, a
satisfactory explanation of a company's intentions must be disclosed in the
proxy statement for proposals requesting an increase of greater than one
hundred percent of the shares outstanding. We will oppose increases in
authorized common stock where there is evidence that the shares will be used to
implement a poison pill or another form of anti-takeover device. We will
support shareholder proposals that seek to eliminate dual class voting
structures.
2.5 Corporate Restructurings, Mergers and Acquisitions
AllianceBernstein believes proxy votes dealing with corporate reorganizations
are an extension of the investment decision. Accordingly, we will analyze such
proposals on a case-by-case basis, weighing heavily the views of our research
analysts that cover the company and our investment professionals managing the
portfolios in which the stock is held.
2.6 Proposals Affecting Shareholder Rights
AllianceBernstein believes that certain fundamental rights of shareholders must
be protected. We will generally vote in favor of proposals that give
shareholders a greater voice in the affairs of the company and oppose any
measure that seeks to limit those rights. However, when analyzing such
proposals we will weigh the financial impact of the proposal against the
impairment of shareholder rights.
2.7 Anti-Takeover Measures
AllianceBernstein believes that measures that impede corporate transactions
such as takeovers or entrench management not only infringe on the rights of
shareholders but may also have a detrimental effect on the value of the
company. We will generally oppose proposals, regardless of whether they are
advanced by management or shareholders, the purpose or effect of which is to
entrench management or excessively or inappropriately dilute shareholder
ownership. Conversely, we support proposals that would restrict or otherwise
eliminate anti-takeover or anti-shareholder measures that have already been
adopted by corporate issuers. For example, we will support shareholder
proposals that seek to require the company to submit a shareholder rights plan
to a shareholder vote. We will evaluate, on a case-by-case basis, proposals to
completely redeem or eliminate such plans. Furthermore, we will generally
oppose proposals put forward by management (including the authorization of
blank check preferred stock, classified boards and supermajority vote
requirements) that appear to be anti-shareholder or intended as management
entrenchment mechanisms.
2.8 Executive Compensation
AllianceBernstein believes that company management and the compensation
committee of the board of directors should, within reason, be given latitude to
determine the types and mix of compensation and benefit awards offered to
company employees. Whether proposed by a shareholder or management, we will
review proposals relating to executive compensation plans on a case-by-case
basis to ensure that the long-term interests of management and shareholders are
properly aligned. In general, we will analyze the proposed plan to ensure that
shareholder equity will not be excessively diluted taking into account shares
available for grant under the proposed plan as well as other existing plans.
We generally will oppose plans that have below market value grant or exercise
prices on the date of issuance or permit repricing of underwater stock options
without shareholder approval. Other factors such as the company's performance
and industry practice will generally be factored into our analysis. We
generally will support shareholder proposals seeking additional disclosure of
executive and director compensation. This policy includes proposals that seek
to specify the measurement of performance based compensation. In addition, we
will support proposals requiring managements to submit severance packages that
exceed 2.99 times the sum of an executive officer's base salary plus bonus that
are triggered by a change in control to a shareholder vote. Finally, we will
support shareholder proposals requiring companies to expense stock options
because we view them as a large corporate expense that should be appropriately
accounted for.
2.9 Social and Corporate Responsibility
AllianceBernstein will review and analyze on a case-by-case basis proposals
relating to social, political and environmental issues to determine whether
they will have a financial impact on shareholder value. We will vote against
proposals that are unduly burdensome or result in unnecessary and excessive
costs to the company. We may abstain from voting on social proposals that do
not have a readily determinable financial impact on shareholder value.
3. Proxy Voting Procedures
3.1 Proxy Voting Committees
Our growth and value investment groups have formed separate proxy voting
committees to establish general proxy policies for AllianceBernstein and
consider specific proxy voting matters as necessary. These committees
periodically review these policies and new types of corporate governance
issues, and decide how we should vote on proposals not covered by these
policies. When a proxy vote cannot be clearly decided by an application of our
stated policy, the proxy committee will evaluate the proposal. In addition,
the committees, in conjunction with the analyst that covers the company, may
contact corporate management and interested shareholder groups and others as
necessary to discuss proxy issues. Members of the committee include senior
investment personnel and representatives of the Legal and Compliance
Department. The committees may also evaluate proxies where we face a potential
conflict of interest (as discussed below). Finally, the committees monitor
adherence to these policies.
3.2 Conflicts of Interest
AllianceBernstein recognizes that there may be a potential conflict of interest
when we vote a proxy solicited by an issuer whose retirement plan we manage, or
we administer, who distributes AllianceBernstein sponsored mutual funds, or
with whom we or an employee has another business or personal relationship that
may affect how we vote on the issuer's proxy. Similarly, AllianceBernstein may
have a potential material conflict of interest when deciding how to vote on a
proposal sponsored or supported by a shareholder group that is a client. We
believe that centralized management of proxy voting, oversight by the proxy
voting committees and adherence to these policies ensures that proxies are
voted with only our clients' best interests in mind. Additionally, we have
implemented procedures to ensure that our votes are not the product of a
material conflict of interests, including: (i) on an annual basis, the proxy
committees will take reasonable steps to evaluate the nature of
AllianceBernstein's and our employees' material business and personal
relationships (and those of our affiliates) with any company whose equity
securities are held in client accounts and any client that has sponsored or has
material interest in a proposal upon which we will be eligible to vote; (ii)
requiring anyone involved in the decision making process to disclose to the
chairman of the appropriate proxy committee any potential conflict that they
are aware of (including personal relationships) and any contact that they have
had with any interested party regarding a proxy vote; (iii) prohibiting
employees involved in the decision making process or vote administration from
revealing how we intend to vote on a proposal in order to reduce any attempted
influence from interested parties; and (iv) where a material conflict of
interests exists, reviewing our proposed vote by applying a series of objective
tests and, where necessary, considering the views of third party research
services to ensure that our voting decision is consistent with our clients'
best interests.
Because under certain circumstances AllianceBernstein considers the
recommendation of third party research services, the proxy committees will take
reasonable steps to verify that any third party research service is in fact
independent based on all of the relevant facts and circumstances. This
includes reviewing the third party research service's conflict management
procedures and ascertaining, among other things, whether the third party
research service (i) has the capacity and competency to adequately analyze
proxy issues; and (ii) can make such recommendations in an impartial manner and
in the best interests of our clients.
3.3 Proxies of Certain Non-US Issuers
Proxy voting in certain countries requires "share blocking." Shareholders
wishing to vote their proxies must deposit their shares shortly before the date
of the meeting with a designated depositary. During this blocking period,
shares that will be voted at the meeting cannot be sold until the meeting has
taken place and the shares are returned to the clients' custodian banks.
Absent compelling reasons to the contrary, AllianceBernstein believes that the
benefit to the client of exercising the vote does not outweigh the cost of
voting (i.e. not being able to sell the shares during this period).
Accordingly, if share blocking is required we generally abstain from voting
those shares.
In addition, voting proxies of issuers in non-US markets may give rise to a
number of administrative issues that may prevent AllianceBernstein from voting
such proxies. For example, AllianceBernstein may receive meeting notices
without enough time to fully consider the proxy or after the cut-off date for
voting. Other markets require AllianceBernstein to provide local agents with
power of attorney prior to implementing AllianceBernstein's voting
instructions. Although it is AllianceBernstein's policy to seek to vote all
proxies for securities held in client accounts for which we have proxy voting
authority, in the case of non-US issuers, we vote proxies on a best efforts
basis.
3.4 Loanned Securities
Many clients of AllianceBernstein have entered into securities lending
arrangements with agent lenders to generate additional revenue.
AllianceBernstein will not be able to vote securities that are on loan under
these types of arrangements. However, under rare circumstances, for voting
issues that may have a significant impact on the investment, we may request
that clients recall securities that are on loan if we determine that the
benefit of voting outweighs the costs and lost revenue to the client or fund
and the administrative burden of retrieving the securities.
3.5 Proxy Voting Records
You may obtain information regarding how the Fund voted proxies relating to
portfolio securities during the most recent 12-month period ended June 30,
without charge. Simply visit AllianceBernstein's web site at
www.alliancebernstein.com, go to the Securities and Exchange Commission's web
site at www.sec.gov or call AllianceBernstein at (800) 227-4618.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
(a) (1) The management of and investment decisions for the Fund's portfolio are
made by the Global Fixed Income: Emerging Markets Investment Team.
The following table lists the five members of the team with the most
significant responsibility for the day-to-day management of the Fund's
portfolio, the length of time that each person has been involved in the
management of the Fund, and each person's principal occupation during the past
five years:
Employee; Year; Title Principal Occupation During the Past Five (5)
Years
Paul DeNoon; principally
responsible for the Fund since Senior Vice President of AB with which he has
August 2002-Senior Vice President been associated in a substantially similar capacity
of AllianceBerntein L.P. ("AB") and to his current position since prior to 2002, and
Director of Emerging Market Debt Director of Emerging Market Debt.
Fernando Grisales; since January Assistant Vice President of AB, with which he has
2005-Assistant Vice President of AB been associated since October 2001. He provided
trade support to Alliance's Bernstein Private
Wealth Group from prior to 2002 until June 2003.
From June 2003 until January 2005, he worked as
a portfolio assistant for the Global Fixed Income
Team and became an Assistant Portfolio Manager
for the Global Fixed Income: Emerging Markets
Investment Team in January 2005.
Michael L. Mon; since August 2002- Vice President of AB with which he has been
Vice President of AB associated in a substantially similar capacity to his
current position since prior to 2002
Douglas J. Peebles; since August Executive Vice President of AB, with which he
2002-Executive Vice President of has been associated in a substantially similar
AB, Chief Investment Officer and capacity to his current position since prior to
Co-Head of Fixed Income 2002, and Chief Investment Officer and Co-Head
of Fixed Income.
Matthew Sheridan; since October Vice President of AB, with which he has been.
2005-Vice President of AB associated in a substantially similar capacity to
his current position since prior to 2002
(a) (2) The following tables provide information regarding registered
investment companies other than the Fund, other pooled investment vehicles and
other accounts over which the Fund's portfolio managers also have day-to-day
management responsibilities. The tables provide the numbers of such accounts,
the total assets in such accounts and the number of accounts and total assets
whose fees are based on performance. The information is provided as of the
Fund's fiscal year ended March 31, 2007.
REGISTERED INVESTMENT COMPANIES
(excluding the Fund)
Total Assets of
Number of Registered
Total Number Total Assets of Registered Investment
of Registered Registered Investment Companies
Investment Investment Companies Managed Managed with
Portfolio Companies Companies with Performance- Performance-based
Manager Managed Managed based Fees Fees
Matthew Sheridan 5 $ 755,000,000 NONE NONE
Michael Mon NONE NONE NONE NONE
Paul DeNoon 8 $3,107,000,000 NONE NONE
Fernando Grisales NONE NONE NONE NONE
Douglas Peebles NONE NONE NONE NONE
POOLED INVESTMENT VEHICLES
Total Number Number of Pooled Total Assets of
of Pooled Investment Vehicles Pooled Investment
Investment Total Assets of Managed with Vehicles Managed
Portfolio Vehicles Pooled Investment Performance-based with Performance-
Manager Managed Vehicles Managed Fees based Fees
Matthew Sheridan 2 $ 887,000,000 NONE NONE
Michael Mon NONE NONE NONE NONE
Paul DeNoon 5 $12,337,000,000 NONE NONE
Fernando Grisales NONE NONE NONE NONE
Douglas Peebles NONE NONE NONE NONE
OTHER ACCOUNTS
Total Number Number of Other Total Assets of
of Other Total Assets of Accounts Managed Other Accounts
Portfolio Accounts Other Accounts with Performance- with Performance-
Manager Managed Managed based Fees based Fees
Matthew Sheridan 10 $ 791,000,000 NONE NONE
Michael Mon NONE NONE NONE NONE
Paul DeNoon 4 $1,987,000,000 NONE NONE
Fernando Grisales NONE NONE NONE NONE
Douglas Peebles NONE NONE NONE NONE
Investment Professional Conflict of Interest Disclosure
As an investment adviser and fiduciary, Alliance owes its clients and
shareholders an undivided duty of loyalty. We recognize that conflicts of
interest are inherent in our business and accordingly have developed policies
and procedures (including oversight monitoring) reasonably designed to detect,
manage and mitigate the effects of actual or potential conflicts of interest in
the area of employee personal trading, managing multiple accounts for multiple
clients, including AllianceBernstein Mutual Funds, and allocating investment
opportunities. Investment professionals, including portfolio managers and
research analysts, are subject to the above-mentioned policies and oversight
monitoring to ensure that all clients are treated equitably. We place the
interests of our clients first and expect all of our employees to meet their
fiduciary duties.
Employee Personal Trading. Alliance has adopted a Code of Business Conduct and
Ethics that is designed to detect and prevent conflicts of interest when
investment professionals and other personnel of Alliance own, buy or sell
securities which may be owned by, or bought or sold for, clients. Personal
securities transactions by an employee may raise a potential conflict of
interest when an employee owns or trades in a security that is owned or
considered for purchase or sale by a client, or recommended for purchase or
sale by an employee to a client. Subject to the reporting requirements and
other limitations of its Code of Business Conduct and Ethics, Alliance permits
its employees to engage in personal securities transactions, and also allows
them to acquire investments in the AllianceBernstein Mutual Funds through
direct purchase, 401K/profit sharing plan investment and/or notionally in
connection with deferred incentive compensation awards. Alliance's Code of
Ethics and Business Conduct requires disclosure of all personal accounts and
maintenance of brokerage accounts with designated broker-dealers approved by
Alliance. The Code also requires preclearance of all securities transactions
and imposes a one-year holding period for securities purchased by employees to
discourage short-term trading.
Managing Multiple Accounts for Multiple Clients. Alliance has compliance
policies and oversight monitoring in place to address conflicts of interest
relating to the management of multiple accounts for multiple clients.
Conflicts of interest may arise when an investment professional has
responsibilities for the investments of more than one account because the
investment professional may be unable to devote equal time and attention to
each account. The investment professional or investment professional teams for
each client may have responsibilities for managing all or a portion of the
investments of multiple accounts with a common investment strategy, including
other registered investment companies, unregistered investment vehicles, such
as hedge funds, pension plans, separate accounts, collective trusts and
charitable foundations. Among other things, Alliance's policies and procedures
provide for the prompt dissemination to investment professionals of initial or
changed investment recommendations by analysts so that investment professionals
are better able to develop investment strategies for all accounts they manage.
In addition, investment decisions by investment professionals are reviewed for
the purpose of maintaining uniformity among similar accounts and ensuring that
accounts are treated equitably. No investment professional that manages client
accounts carrying performance fees is compensated directly or specifically for
the performance of those accounts. Investment professional compensation
reflects a broad contribution in multiple dimensions to long-term investment
success for our clients and is not tied specifically to the performance of any
particular client's account, nor is it directly tied to the level or change in
level of assets under management.
Allocating Investment Opportunities. Alliance has policies and procedures
intended to address conflicts of interest relating to the allocation of
investment opportunities. These policies and procedures are designed to ensure
that information relevant to investment decisions is disseminated promptly
within its portfolio management teams and investment opportunities are
allocated equitably among different clients. The investment professionals at
Alliance routinely are required to select and allocate investment opportunities
among accounts. Portfolio holdings, position sizes, and industry and sector
exposures tend to be similar across similar accounts, which minimizes the
potential for conflicts of interest relating to the allocation of investment
opportunities. Nevertheless, investment opportunities may be allocated
differently among accounts due to the particular characteristics of an account,
such as size of the account, cash position, tax status, risk tolerance and
investment restrictions or for other reasons.
Alliance's procedures are also designed to prevent potential conflicts of
interest that may arise when Alliance has a particular financial incentive,
such as a performance-based management fee, relating to an account. An
investment professional may perceive that he or she has an incentive to devote
more time to developing and analyzing investment strategies and opportunities
or allocating securities preferentially to accounts for which Alliance could
share in investment gains.
To address these conflicts of interest, Alliance's policies and procedures
require, among other things, the prompt dissemination to investment
professionals of any initial or changed investment recommendations by analysts;
the aggregation of orders to facilitate best execution for all accounts; price
averaging for all aggregated orders; objective allocation for limited
investment opportunities (e.g., on a rotational basis) to ensure fair and
equitable allocation among accounts; and limitations on short sales of
securities. These procedures also require documentation and review of
justifications for any decisions to make investments only for select accounts
or in a manner disproportionate to the size of the account.
(a) (3) Portfolio Manager Compensation
Alliance's compensation program for investment professionals is designed to be
competitive and effective in order to attract and retain the highest caliber
employees. The compensation program for investment professionals is designed to
reflect their ability to generate long-term investment success for our clients,
including shareholders of the AllianceBernstein Mutual Funds. Investment
professionals do not receive any direct compensation based upon the investment
returns of any individual client account, nor is compensation tied directly to
the level or change in level of assets under management. Investment
professionals' annual compensation is comprised of the following:
(i) Fixed base salary: This is generally the smallest portion of compensation.
The base salary is a relatively low, fixed salary within a similar range for
all investment professionals. The base salary is determined at the outset of
employment based on level of experience, does not change significantly from
year-to-year and hence, is not particularly sensitive to performance.
(ii) Discretionary incentive compensation in the form of an annual cash bonus:
Alliance's overall profitability determines the total amount of incentive
compensation available to investment professionals. This portion of
compensation is determined subjectively based on qualitative and quantitative
factors. In evaluating this component of an investment professional's
compensation, Alliance considers the contribution to his/her team or discipline
as it relates to that team's overall contribution to the long-term investment
success, business results and strategy of Alliance. Quantitative factors
considered include, among other things, relative investment performance (e.g.,
by comparison to competitor or peer group funds or similar styles of
investments, and appropriate, broad-based or specific market indices), and
consistency of performance. There are no specific formulas used to determine
this part of an investment professional's compensation and the compensation is
not tied to any pre-determined or specified level of performance. Alliance
also considers qualitative factors such as the complexity and risk of
investment strategies involved in the style or type of assets managed by the
investment professional; success of marketing/business development efforts and
client servicing; seniority/length of service with the firm; management and
supervisory responsibilities; and fulfillment of Alliance's leadership criteria.
(iii) Discretionary incentive compensation in the form of awards under
Alliance's Partners Compensation Plan ("deferred awards"): Alliance's overall
profitability determines the total amount of deferred awards available to
investment professionals. The deferred awards are allocated among investment
professionals based on criteria similar to those used to determine the annual
cash bonus. There is no fixed formula for determining these amounts. Deferred
awards, for which there are various investment options, vest over a four-year
period and are generally forfeited if the employee resigns or Alliance
terminates his/her employment. Investment options under the deferred awards
plan include many of the same AllianceBernstein Mutual Funds offered to mutual
fund investors, thereby creating a close alignment between the financial
interests of the investment professionals and those of Alliance's clients and
mutual fund shareholders with respect to the performance of those mutual funds.
Alliance also permits deferred award recipients to allocate up to 50% of their
award to investments in Alliance's publicly traded equity securities.(1)
(iv) Contributions under Alliance's Profit Sharing/401(k) Plan: The
contributions are based on Alliance's overall profitability. The amount and
allocation of the contributions are determined at the sole discretion of
Alliance.
(a) (4) The dollar range of the Fund's equity securities owned directly or
beneficially by the Fund's portfolio managers as of the Fund's fiscal year
ended March 31, 2007 is set forth below:
DOLLAR RANGE OF EQUITY
SECURITIES IN THE FUND
Paul DeNoon 0 - $10,000
Fernando Grisales None
Michael Mon None
Douglas Peebles None
Matthew Sheridan None
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
There have been no purchases of equity securities by the Fund or by affiliated
parties for the reporting period.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
There have been no material changes to the procedures by which shareholders may
recommend nominees to the Fund's Board of Directors since the Fund last
provided disclosure in response to this item.
ITEM 11. CONTROLS AND PROCEDURES.
(a) The registrant's principal executive officer and principal financial
officer have concluded that the registrant's disclosure controls and procedures
(as defined in Rule 30a-2(c) under the Investment Company Act of 1940, as
amended) are effective at the reasonable assurance level based on their
evaluation of these controls and procedures as of a date within 90 days of the
filing date of this document.
(b) There were no changes in the registrant's internal controls over financial
reporting that occurred during the second fiscal quarter of the period that has
materially affected, or is reasonably likely to materially affect, the
registrant's internal control over financial reporting.
ITEM 12. EXHIBITS.
The following exhibits are attached to this Form N-CSR:
EXHIBIT NO. DESCRIPTION OF EXHIBIT
12 (a) (1) Code of Ethics that is subject to the disclosure of Item 2
hereof
12 (b) (1) Certification of Principal Executive Officer Pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002
12 (b) (2) Certification of Principal Financial Officer Pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002
12 (c) Certification of Principal Executive Officer and Principal
Financial Officer Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant): AllianceBernstein Global High Income Fund, Inc.
By: /s/ Marc O. Mayer
-----------------
Marc O. Mayer
President
Date: May 30, 2007
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: /s/ Marc O. Mayer
-----------------
Marc O. Mayer
President
Date: May 30, 2007
By: /s/ Joseph J. Mantineo
----------------------
Joseph J. Mantineo
Treasurer and Chief Financial Officer
Date: May 30, 2007
1 Prior to 2002, investment professional compensation also included
discretionary long-term incentive in the form of restricted grants of Alliance
Capital's Master Limited Partnership Units.