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Amcap Fund (CAFBX)

Filed: 30 Oct 11, 8:00pm
 
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: 811-01435



AMCAP Fund
(Exact Name of Registrant as Specified in Charter)

333 South Hope Street
Los Angeles, California 90071
(Address of Principal Executive Offices)




Registrant's telephone number, including area code: (213) 486-9200

Date of fiscal year end: February 28 or 29

Date of reporting period: August 31, 2011





Vincent P. Corti
Capital Research and Management Company
333 South Hope Street
Los Angeles, California 90071
(Name and Address of Agent for Service)


Copies to:
Eric A. S. Richards
O’Melveny & Myers LLP
400 South Hope Street, 10th Floor
Los Angeles, California 90071
(Counsel for the Registrant)


 
 

 

ITEM 1 – Reports to Stockholders
 
 
 
 
 
AMCAP Fund®
 
 
[photo of a flock of geese in flight - mountains in the background]
 
Semi-annual report for the six months ended August 31, 2011
 
 
AMCAP Fund seeks long-term growth of capital by investing primarily in U.S. companies that have solid long-term records and the potential for good future growth.

This fund is one of the 33 American Funds. For 80 years, Capital Research and Management Company,SM the American Funds adviser, has invested with a long-term focus based on thorough research and attention to risk.

Fund results shown in this report, unless otherwise indicated, are for Class A shares at net asset value. If a sales charge (maximum 5.75%) had been deducted, the results would have been lower. Results are for past periods and are not predictive of results for future periods. Current and future results may be lower or higher than those shown. Share prices and returns will vary, so investors may lose money. Investing for short periods makes losses more likely. Investments are not FDIC-insured, nor are they deposits of or guaranteed by a bank or any other entity, so they may lose value. For current information and month-end results, visit americanfunds.com.

Here are total returns on a $1,000 investment with all distributions reinvested for periods ended September 30, 2011 (the most recent calendar quarter-end):
          
Class A shares 1 year  5 years  10 years 
Reflecting 5.75% maximum sales charge         
Average annual total return     –0.75%  3.35%
Cumulative total return  –4.37%  –3.72%  39.05%

The total annual fund operating expense ratio was 0.73% for Class A shares as of the most recent fiscal year-end.
 
Investment results assume all distributions are reinvested and reflect applicable fees and expenses. The fund’s investment adviser waived a portion of its management fees from September 1, 2004, through December 31, 2008. Applicable fund results shown reflect the waiver, without which they would have been lower. See the Financial Highlights table on pages 22 to 28 for details.

Results for other share classes can be found on page 31.

See the prospectus and the Risk Factors section of this report for more information on these and other risks associated with investing in the fund.
 
 
Fellow investors:
 
[photo of a flock of geese in flight - mountains in the background]

Over the six months ended August 31, 2011, the U.S. stock market produced returns that started out on the positive side but later declined. Investors were concerned about the risk of a financial debt crisis in Europe, the slowing of the U.S. economic recovery, perceived gridlock on Capitol Hill and continued high levels of unemployment in the U.S.
 
In this volatile environment, AMCAP Fund had a total return of –6.4%, compared with –7.2% for the unmanaged Standard & Poor’s 500 Composite Index, a broad measure of mostly large U.S. stocks. The fund also outpaced the Lipper Growth Funds Index, as shown in the chart below.

For the 12 months ended August 31, 2011, AMCAP had a total return of 20.3%, compared with 18.5% for the S&P 500.

AMCAP also continued to exceed the S&P 500 and the fund’s Lipper index over the long term by a significant margin. For the past five years, the fund had a cumulative total return of 12.4%, compared with 4.0% for the S&P 500. Over its 44-year lifetime, AMCAP had an average annual total return of 11.1%, compared with 9.3% for the S&P 500.

Investment results analysis

Information technology, the fund’s largest sector, had mixed results. For instance, Microsoft, the fund’s largest holding, was virtually flat at +0.1%, beating the overall market, and Apple, our second-largest holding, gained 9.0%; however, Corning, our 22nd-largest holding, manufacturer of specialty glass for liquid crystal displays in flat panel television sets, declined 34.8%.

Cumulative total returns            
             
For periods ended August 31, 2011 Six months  1 year  5 years  10 years 
             
AMCAP (Class A shares)  –6.4%  20.3%  12.4%  42.7%
Standard & Poor’s 500 Composite Index*  –7.2   18.5   4.0   30.5 
Lipper Growth Funds Index
  –7.9   19.1   3.8   21.5 
                 
*The S&P 500 is unmanaged, and its results include reinvested distributions but do not reflect the effect of sales charges, commissions, account fees, expenses or taxes.
Results of the Lipper index include reinvested distributions but do not reflect the effect of sales charges, account fees or taxes.

Some of the fund’s holdings in financial companies faired poorly as the stresses in the financial markets continue to impact loan growth and balance sheets. The fund has a relatively small exposure to this sector, but nevertheless our seventh-largest holding was JPMorgan Chase & Co., which declined almost 20% over the six-month period. Many of the stronger companies in this sector are now selling at historically low valuations.

Our holdings in the health care sector did relatively well, led by Biogen Idec (+37.7%), the fund’s third-largest holding, a developer of treatments for multiple sclerosis and cancer. The fund’s cash position of 11.1% of the total portfolio also helped during the recent six-month period since the stock market in general went down.

As of August 31, 2011, AMCAP’s industry sector mix included 20.0% in information technology, 17.5% in health care, 15.1% in consumer discretionary, 9.9% in industrials, 8.4% in financials, 6.9% in energy, 4.6% in consumer staples, 2.4% in materials, 2.0% in telecommunications services and 2.1% in other industries.

The past six months have been turbulent. Overall volatility is evidence of the short-term nature of today’s market. In periods like these, our long-term perspective on companies and their inherent value is critical in helping us identify and invest in those that represent good value over the long run. We believe this helps us to keep our perspective in an uncertain market environment. The fund has a sizable cash position which we can invest when we see even greater opportunities than are offered today.

We thank you for taking a long-term perspective on your mutual fund investments. It’s particularly important in these times to separate the short-term stock price fluctuations from the fundamental growth qualities of the companies that AMCAP holds in its portfolio. We appreciate your support of AMCAP Fund.

Cordially,

/s/ Claudia P. Huntington

Claudia P. Huntington
Vice Chairman of the Board


/s/ Timothy D. Armour

Timothy D. Armour
President

October 11, 2011

For current information about the fund, visit americanfunds.com.

 
Summary investment portfolio August 31, 2011
unaudited
 
The following summary investment portfolio is designed to streamline the report and help investors better focus on the fund’s principal holdings.  See the inside back cover for details on how to obtain a complete schedule of portfolio holdings.
 
[begin pie chart]
Industry sector diversification 
Percent of net assets
 
    
Information technology  20.03%
Health care  17.50 
Consumer discretionary  15.05 
Industrials  9.91 
Financials  8.39 
Other industries  18.03 
Short-term securities & other assets less liabilities  11.09 
[end pie chart]
 
 
        Percent 
     Value  of net 
Common stocks  - 88.91% Shares   (000) assets 
           
Information technology  - 20.03%          
Microsoft Corp.  26,045,000  $692,797   3.24%
Apple Inc. (1)  1,490,000   573,397   2.68 
Yahoo! Inc. (1)  21,903,800   298,001   1.39 
Corning Inc.  17,100,000   257,013   1.20 
Oracle Corp.  9,120,000   255,998   1.20 
MasterCard Inc., Class A  750,000   247,282   1.16 
QUALCOMM Inc.  3,800,000   195,548   .91 
Accenture PLC, Class A  3,250,000   174,167   .81 
Automatic Data Processing, Inc.  2,975,000   148,839   .70 
Hewlett-Packard Co.  5,550,000   144,466   .68 
Other securities      1,295,513   6.06 
       4,283,021   20.03 
             
Health care  - 17.50%            
Biogen Idec Inc. (1)  5,756,000   542,215   2.54 
Medco Health Solutions, Inc. (1)  6,607,991   357,757   1.67 
Gilead Sciences, Inc. (1)  8,450,000   337,028   1.58 
St. Jude Medical, Inc.  6,780,000   308,761   1.44 
McKesson Corp.  3,475,000   277,757   1.30 
Amgen Inc.  4,405,000   244,059   1.14 
Hologic, Inc. (1)   (2)  13,774,100   229,201   1.07 
Endo Pharmaceuticals Holdings Inc. (1)   (2)  6,200,000   197,842   .92 
Medtronic, Inc.  4,690,000   164,478   .77 
Other securities      1,083,865   5.07 
       3,742,963   17.50 
             
Consumer discretionary  - 15.05%            
DIRECTV, Class A (1)  12,240,000   538,193   2.52 
Kohl's Corp.  6,815,000   315,807   1.48 
Johnson Controls, Inc.  8,550,000   272,574   1.27 
YUM! Brands, Inc.  4,726,000   256,953   1.20 
News Corp., Class A  11,850,000   204,649   .96 
Garmin Ltd.  5,399,000   181,028   .85 
Tractor Supply Co.  2,650,000   162,630   .76 
Comcast Corp., Class A  6,875,000   147,881   .69 
Time Warner Inc.  4,433,333   140,359   .66 
Time Warner Cable Inc.  2,095,613   137,263   .64 
Other securities      859,887   4.02 
       3,217,224   15.05 
             
Industrials  - 9.91%            
Precision Castparts Corp.  2,860,000   468,611   2.19 
Union Pacific Corp.  3,370,600   310,668   1.45 
United Technologies Corp.  2,850,000   211,612   .99 
United Parcel Service, Inc., Class B  2,820,000   190,040   .89 
CSX Corp.  7,884,500   172,986   .81 
General Dynamics Corp.  2,355,000   150,908   .70 
Other securities      615,400   2.88 
       2,120,225   9.91 
             
Financials  - 8.39%            
JPMorgan Chase & Co.  9,500,000   356,820   1.67 
Wells Fargo & Co.  10,079,600   263,078   1.23 
Capital One Financial Corp.  4,245,700   195,514   .91 
American Express Co.  3,500,000   173,985   .81 
Other securities      805,696   3.77 
       1,795,093   8.39 
             
Energy  - 6.85%            
Schlumberger Ltd.  4,366,940   341,145   1.60 
EOG Resources, Inc.  3,548,000   328,509   1.54 
FMC Technologies, Inc. (1)  4,450,000   197,847   .92 
Other securities      597,288   2.79 
       1,464,789   6.85 
             
Consumer staples  - 4.62%            
CVS/Caremark Corp.  7,350,000   263,938   1.23 
PepsiCo, Inc.  2,917,981   188,006   .88 
Philip Morris International Inc.  2,500,000   173,300   .81 
Other securities      363,652   1.70 
       988,896   4.62 
             
Materials - 2.41%            
Other securities      514,989   2.41 
             
             
Telecommunication services  - 2.05%            
MetroPCS Communications, Inc. (1)  13,114,500   146,358   .68 
Other securities      291,882   1.37 
       438,240   2.05 
             
Miscellaneous -  2.10%            
Other common stocks in initial period of acquisition      448,432   2.10 
             
             
Total common stocks (cost: $15,164,070,000)      19,013,872   88.91 
             
             
             
          Percent 
      Value  of net 
Convertible securities  - 0.00% Shares   (000) assets 
             
Consumer discretionary  - 0.00%            
Johnson Controls, Inc. 11.50% convertible preferred 2012, units (3)  4,600   713   .00 
             
             
Total convertible securities (cost: $230,000)      713   .00 
             
             
             
  Principal      Percent 
  amount  Value  of net 
Short-term securities  - 10.98%  (000)  (000) assets 
             
Freddie Mac 0.11%-0.281% due 10/4/2011-6/7/2012 $537,877   537,746   2.51 
Fannie Mae 0.03%-0.231% due 9/26/2011-7/16/2012  450,700   450,593   2.11 
Federal Home Loan Bank 0.105%-0.25% due 10/12/2011-8/1/2012  345,683   345,474   1.62 
Federal Farm Credit Banks 0.12%-0.281% due 9/9/2011-2/23/2012  206,784   206,743   .97 
U.S. Treasury Bills 0.155%-0.222% due 9/1/2011-5/3/2012  185,545   185,517   .87 
Variable Funding Capital Company LLC 0.13%-0.20% due 9/6-10/25/2011 (4)  130,450   130,421   .61 
Falcon Asset Securitization Co., LLC 0.14%-0.20% due 9/21-10/11/2011 (4)  64,700   64,692   .30 
Other securities      426,636   1.99 
             
             
Total short-term securities (cost: $2,347,086,000)      2,347,822   10.98 
             
             
Total investment securities (cost: $17,511,386,000)      21,362,407   99.89 
Other assets less liabilities      22,307   .11 
             
Net assets     $21,384,714   100.00%
 
 
As permitted by U.S. Securities and Exchange Commission regulations, "Miscellaneous" securities include holdings in their first year of acquisition that have not previously been publicly disclosed.
 
"Other securities" includes all issues that are not disclosed separately in the summary investment portfolio.
 
 
Investments in affiliates                  
A company is considered to be an affiliate of the fund under the Investment Company Act of 1940 if the fund's holdings in that company represent 5% or more of the outstanding voting shares. The value of the fund's affiliated-company holdings is either shown in the summary investment portfolio or included in the value of "Other securities" under the respective industry sectors. Further details on such holdings and related transactions during the six months ended August 31, 2011, appear below.
                   
  
Beginning
shares
  Additions  Reductions  
Ending
shares
  
Dividend
income
(000)
  
Value of
affiliates at 8/31/2011
(000)
 
Hologic, Inc. (1)  14,374,100   -   600,000   13,774,100  $-  $229,201 
Endo Pharmaceuticals Holdings Inc. (1)  4,700,000   1,500,000   -   6,200,000   -   197,842 
MITIE Group PLC  22,902,000   -   -   22,902,000   1,823   82,570 
                  $1,823  $509,613 
 
 
The following footnotes apply to either the individual securities noted or one or more of the securities aggregated and listed as a single line item.
 
(1) Security did not produce income during the last 12 months.
(2) Represents an affiliated company as defined under the Investment Company Act of 1940.
(3) Valued under fair value procedures adopted by authority of the board of trustees. The total value of all such securities was $713,000, which represented less than .01% of the net assets of the fund.
(4) Acquired in a transaction exempt from registration under the Securities Act of 1933. May be resold in the U.S. in transactions exempt from registration, normally to qualified institutional buyers. The total value of all such securities, including those in "Other securities," was $561,458,000, which represented 2.63% of the net assets of the fund.
 
 
See Notes to Financial Statements
 
 
 
Financial statements
 
Statement of assets and liabilities    unaudited 
at August 31, 2011  (dollars in thousands) 
       
Assets:      
 Investment securities, at value:      
  Unaffiliated issuers (cost: $17,048,472) $20,852,794    
  Affiliated issuers (cost: $462,914)  509,613  $21,362,407 
 Receivables for:        
  Sales of investments  17,744     
  Sales of fund's shares  29,459     
  Dividends and interest  28,782   75,985 
       21,438,392 
Liabilities:        
 Payables for:        
  Repurchases of fund's shares  31,910     
  Investment advisory services  5,718     
  Services provided by related parties  13,645     
  Trustees' deferred compensation  1,887     
  Other  518   53,678 
Net assets at August 31, 2011     $21,384,714 
         
Net assets consist of:        
 Capital paid in on shares of beneficial interest     $18,912,870 
 Undistributed net investment income      53,251 
 Accumulated net realized loss      (1,432,550)
 Net unrealized appreciation      3,851,143 
Net assets at August 31, 2011     $21,384,714 
 
 
 (dollars and shares in thousands, except per-share amounts) 
          
Shares of beneficial interest issued and outstanding (no stated par value) -         
unlimited shares authorized (1,165,447 total shares outstanding)         
  Net assets  Shares outstanding  
Net asset
value per share
 
Class A $13,530,899   733,313  $18.45 
Class B  421,935   23,948   17.62 
Class C  1,055,638   60,410   17.47 
Class F-1  1,515,102   82,476   18.37 
Class F-2  768,577   41,600   18.48 
Class 529-A  611,782   33,304   18.37 
Class 529-B  53,848   3,060   17.60 
Class 529-C  159,889   9,082   17.61 
Class 529-E  33,601   1,851   18.15 
Class 529-F-1  32,881   1,788   18.39 
Class R-1  45,941   2,584   17.78 
Class R-2  382,836   21,562   17.76 
Class R-3  580,233   31,854   18.22 
Class R-4  477,360   26,003   18.36 
Class R-5  807,707   43,594   18.53 
Class R-6  906,485   49,018   18.49 
             
See Notes to Financial Statements            
 
 
Statement of operations    unaudited 
for the six months ended August 31, 2011  (dollars in thousands) 
       
Investment income:      
 Income:      
  Dividends (net of non-U.S. taxes of $2,122;      
   also includes $1,823 from affiliates) $143,729    
  Interest  2,078    
      $145,807 
         
 Fees and expenses*:        
  Investment advisory services  37,029     
  Distribution services  33,029     
  Transfer agent services  11,282     
  Administrative services  6,476     
  Reports to shareholders  915     
  Registration statement and prospectus  337     
  Trustees' compensation  246     
  Auditing and legal  21     
  Custodian  70     
  State and local taxes  203     
  Other  544   90,152 
 Net investment income      55,655 
         
Net realized gain and unrealized depreciation        
 on investments and currency:        
 Net realized gain (loss) on:        
  Investments (includes $1,716 net gain from affiliates)  1,103,740     
  Currency transactions  (744)  1,102,996 
 Net unrealized (depreciation) appreciation on:        
  Investments  (2,628,329)    
  Currency translations  122   (2,628,207)
   Net realized gain and unrealized depreciation on investments and currency      (1,525,211)
         
Net decrease in net assets resulting from operations     $(1,469,556)
         
(*) Additional information related to class-specific fees and expenses is included        
in the Notes to Financial Statements.        
         
See Notes to Financial Statements        
         
         
         
         
Statements of changes in net assets        
    (dollars in thousands) 
  Six months  Year ended 
  ended August 31,  February 28, 
   2011*   2011 
Operations:        
 Net investment income $55,655  $82,498 
 Net realized gain on investments and currency transactions  1,102,996   547,403 
 Net unrealized (depreciation) appreciation on investments and currency translations  (2,628,207)  3,184,478 
  Net (decrease) increase in net assets resulting from operations  (1,469,556)  3,814,379 
         
Dividends paid to shareholders from net investment income  (82,103)  (87,370)
         
Net capital share transactions  (264,374)  (173,866)
         
Total (decrease) increase in net assets  (1,816,033)  3,553,143 
         
Net assets:        
 Beginning of period  23,200,747   19,647,604 
 End of period (including undistributed        
  net investment income: $53,251 and $79,699, respectively) $21,384,714  $23,200,747 
         
*Unaudited.        
         
See Notes to Financial Statements        
 
 
 
Notes to financial statements   
                                                                                                        unaudited

1.  Organization

AMCAP Fund (the "fund") is registered under the Investment Company Act of 1940 as an open-end, diversified management investment company. The fund seeks long-term growth of capital by investing primarily in U.S. companies that have solid long-term growth records and the potential for good future growth.

The fund has 16 share classes consisting of five retail share classes, five 529 college savings plan share classes and six retirement plan share classes. The 529 college savings plan share classes (529-A, 529-B, 529-C, 529-E and 529-F-1) can be used to save for college education. The six retirement plan share classes (R-1, R-2, R-3, R-4, R-5 and R-6) are generally offered only through eligible employer-sponsored retirement plans. The fund’s share classes are described below:
 
Share classInitial sales chargeContingent deferred sales charge upon redemptionConversion feature
Classes A and 529-AUp to 5.75%None (except 1% for certain redemptions within one year of purchase without an initial sales charge)None
Classes B and 529-B*NoneDeclines from 5% to 0% for redemptions within six years of purchaseClasses B and 529-B convert to Classes A and 529-A, respectively, after eight years
Class CNone1% for redemptions within one year of purchaseClass C converts to Class F-1 after 10 years
Class 529-CNone1% for redemptions within one year of purchaseNone
Class 529-ENoneNoneNone
Classes F-1, F-2 and 529-F-1NoneNoneNone
Classes R-1, R-2, R-3, R-4, R-5 and R-6NoneNone
None
 
*Class B and 529-B shares of the fund are not available for purchase.

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

2.  Significant accounting policies

The financial statements have been prepared to comply with accounting principles generally accepted in the United States of America. These principles require management to make estimates and assumptions that affect reported amounts and disclosures. Actual results could differ from those estimates. The fund follows the significant accounting policies described below, as well as the valuation policies described in the next section on valuation.

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

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

Dividends and distributions to shareholders Dividends and distributions paid to shareholders are recorded on the ex-dividend date.

Currency translation – Assets and liabilities, including investment securities, denominated in currencies other than U.S. dollars are translated into U.S. dollars at the exchange rates in effect on the valuation date. Purchases and sales of investment securities and income and expenses are translated into U.S. dollars at the exchange rates on the dates of such transactions. On the accompanying financial statements, the effects of changes in exchange rates on investment securities are included with the net realized gain or loss and net unrealized appreciation or depreciation on investments. The realized gain or loss and unrealized appreciation or depreciation resulting from all other transactions denominated in currencies other than U.S. dollars are disclosed separately.

3.  Valuation

The fund’s investments are reported at fair value as defined by accounting principles generally accepted in the United States of America. The fund generally determines the net asset value of each share class as of approximately 4:00 p.m. New York time each day the New York Stock Exchange is open.

Methods and inputs – The fund uses the following methods and inputs to establish the fair value of its assets and liabilities. Use of particular methods and inputs may vary over time based on availability and relevance as market and economic conditions evolve.

Equity securities are generally valued at the official closing price of, or the last reported sale price on, the exchange or market on which such securities are traded, as of the close of business on the day the securities are being valued or, lacking any sales, at the last available bid price. Prices for each security are taken from the principal exchange or market on which the security trades.

Fixed-income securities, including short-term securities purchased with more than 60 days left to maturity, are generally valued at prices obtained from one or more pricing vendors. Vendors value such securities based on one or more of the inputs described in the following table. The table provides examples of inputs that are commonly relevant for valuing particular classes of fixed-income securities in which the fund is authorized to invest. However, these classifications are not exclusive, and any of the inputs may be used to value any other class of fixed-income security.

Fixed-income classExamples of standard inputs
AllBenchmark yields, transactions, bids, offers, quotations from dealers and trading systems, new issues, spreads and other relationships observed in the markets among comparable securities; and proprietary pricing models such as yield measures calculated using factors such as cash flows, financial or collateral performance and other reference data (collectively referred to as “standard inputs”)
Corporate bonds & notes; convertible securitiesStandard inputs and underlying equity of the issuer
Bonds & notes of governments & government agenciesStandard inputs and interest rate volatilities

Where the investment adviser deems it appropriate to do so (such as when vendor prices are unavailable or not deemed to be representative), fixed-income securities will be valued in good faith at the mean quoted bid and asked prices that are reasonably and timely available (or bid prices, if asked prices are not available) or at prices for securities of comparable maturity, quality and type.

Securities with both fixed-income and equity characteristics, or equity securities traded principally among fixed-income dealers, are generally valued in the manner described above for either equity or fixed-income securities, depending on which method is deemed most appropriate by the investment adviser. Short-term securities purchased within 60 days to maturity are valued at amortized cost, which approximates fair value. The value of short-term securities originally purchased with maturities greater than 60 days is determined based on an amortized value to par when they reach 60 days.

Securities and other assets for which representative market quotations are not readily available or are considered unreliable by the investment adviser are fair valued as determined in good faith under guidelines adopted by authority of the fund's board of trustees. Market quotations may be considered unreliable if events occur that materially affect the value of securities (particularly equity securities trading outside the U.S.) between the close of trading in those securities and the close of regular trading on the New York Stock Exchange. Various inputs may be reviewed in order to make a good faith determination of a security’s fair value. These inputs include, but are not limited to, the type and cost of the security; contractual or legal restrictions on resale of the security; relevant financial or business developments of the issuer; actively traded similar or related securities; conversion or exchange rights on the security; related corporate actions; significant events occurring after the close of trading in the security; and changes in overall market conditions. Fair valuations and valuations of investments that are not actively trading involve judgment and may differ materially from valuations that would have been used had greater market activity occurred.

Classifications - The fund classifies its assets and liabilities into three levels based on the inputs used to value the assets or liabilities. Level 1 values are based on quoted prices in active markets for identical securities. Level 2 values are based on significant observable market inputs, such as quoted prices for similar securities and quoted prices in inactive markets. Certain securities trading outside the U.S. may transfer between Level 1 and Level 2 due to valuation adjustments resulting from significant market movements following the close of local trading. Level 3 values are based on significant unobservable inputs that reflect the fund’s determination of assumptions that market participants might reasonably use in valuing the securities. The valuation levels are not necessarily an indication of the risk or liquidity associated with the underlying investment. For example, U.S. government securities are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market. The following table presents the fund’s valuation levels as of August 31, 2011 (dollars in thousands):

Investment securities: Level 1  Level 2  Level 3  Total 
Common stocks:            
     Information technology
 $4,283,021  $-  $-  $4,283,021 
     Health care
  3,742,963   -   -   3,742,963 
     Consumer discretionary
  3,217,224   -   -   3,217,224 
     Industrials
  2,120,225   -   -   2,120,225 
     Financials
  1,795,093   -   -   1,795,093 
     Energy
  1,464,789   -   -   1,464,789 
     Consumer staples
  988,896   -   -   988,896 
     Materials
  514,989   -   -   514,989 
     Telecommunication services
  438,240   -   -   438,240 
     Miscellaneous
  448,432   -   -   448,432 
Convertible securities  -   713   -   713 
Short-term securities  -   2,347,822   -   2,347,822 
Total $19,013,872  $2,348,535  $-  $21,362,407 
 
4.  Risk factors

Investing in the fund may involve certain risks including, but not limited to, those described below.

Market conditions – The prices of, and the income generated by, the common stocks and other securities held by the fund may decline due to market conditions and other factors, including those directly involving the issuers of securities held by the fund.

Investing in growth-oriented stocks – Growth-oriented stocks may involve larger price swings and greater potential for loss than other types of investments.

Management –The investment adviser to the fund actively manages the fund’s investments. Consequently, the fund is subject to the risk that the methods and analyses employed by the investment adviser in this process may not produce the desired results. This could cause the fund to lose value or its results to lag relevant benchmarks or other funds with similar objectives.
 
5.  Taxation and distributions
 
Federal income taxation – The fund complies with the requirements under Subchapter M of the Internal Revenue Code applicable to mutual funds and intends to distribute substantially all of its net taxable income and net capital gains each year. The fund is not subject to income taxes to the extent such distributions are made. Therefore, no federal income tax provision is required.

As of and during the period ended August 31, 2011, the fund did not have a liability for any unrecognized tax benefits. The fund recognizes interest and penalties, if any, related to unrecognized tax benefits as income tax expense in the statement of operations. During the period, the fund did not incur any interest or penalties.

The fund is not subject to examination by U.S. federal tax authorities for tax years before 2007 and by state tax authorities for tax years before 2006.

Non-U.S. taxation – Dividend income is recorded net of non-U.S. taxes paid.

Distributions – Distributions paid to shareholders are based on net investment income and net realized gains determined on a tax basis, which may differ from net investment income and net realized gains for financial reporting purposes. These differences are due primarily to different treatment for items such as currency gains and losses; short-term capital gains and losses; and net capital losses. The fiscal year in which amounts are distributed may differ from the year in which the net investment income and net realized gains are recorded by the fund for financial reporting purposes.

The components of distributable earnings on a tax basis are reported as of the fund’s most recent year-end. As of February 28, 2011, the components of distributable earnings on a tax basis were as follows:

  (dollars in thousands) 
Undistributed ordinary income    $81,519 
Capital loss carryforwards*:       
     Expiring 2017 $(313,487)    
     Expiring 2018  (2,222,000)  (2,535,487)
         
*The capital loss carryforwards will be used to offset any capital gains realized by the fund in the current year or in subsequent years through the expiration dates. The fund will not make distributions from capital gains while capital loss carryforwards remain.

Under the Regulated Investment Company Modernization Act of 2010 (the “Act”), net capital losses recognized after February 28, 2011, may be carried forward indefinitely, and their character is retained as short-term and/or long-term losses. Previously, net capital losses were carried forward for eight years and treated as short-term losses. As a transition rule, the Act requires that post-enactment net capital losses be used before pre-enactment net capital losses.

As of August 31, 2011, the tax basis unrealized appreciation (depreciation) and cost of investment securities were as follows:

  (dollars in thousands) 
Gross unrealized appreciation on investment securities $4,671,547 
Gross unrealized depreciation on investment securities  (820,530)
Net unrealized appreciation on investment securities  3,851,017 
Cost of investment securities  17,511,390 
 
 
Tax-basis distributions paid to shareholders from ordinary income were as follows (dollars in thousands):

Share class Six months ended August 31, 2011  
Year ended
February 28, 2011
 
Class A $53,808  $62,209 
Class B  -   - 
Class C  -   - 
Class F-1  6,172   7,464 
Class F-2  5,015   3,113 
Class 529-A  2,302   2,324 
Class 529-B  -   - 
Class 529-C  -   - 
Class 529-E  44   62 
Class 529-F-1  191   133 
Class R-1  -   - 
Class R-2  -   - 
Class R-3  660   1,122 
Class R-4  1,951   1,911 
Class R-5  5,700   5,751 
Class R-6  6,260   3,281 
Total $82,103  $87,370 
 
6.  Fees and transactions with related parties
 
Capital Research and Management Company ("CRMC"), the fund’s investment adviser, is the parent company of American Funds Distributors,® Inc. ("AFD"), the principal underwriter of the fund’s shares, and American Funds Service Company® ("AFS"), the fund’s transfer agent.

Investment advisory services – The fund has an investment advisory and service agreement with CRMC that provides for monthly fees accrued daily. These fees are based on a series of decreasing annual rates beginning with 0.485% on the first $1 billion of daily net assets and decreasing to 0.290% on such assets in excess of $27 billion. For the six months ended August 31, 2011, the investment advisory services fee was $37,029,000, which was equivalent to an annualized rate of 0.322% of average daily net assets.

Class-specific fees and expenses – Expenses that are specific to individual share classes are accrued directly to the respective share class. The principal class-specific fees and expenses are described below:

Distribution services – The fund has plans of distribution for all share classes, except Classes F-2, R-5 and R-6. Under the plans, the board of trustees approves certain categories of expenses that are used to finance activities primarily intended to sell fund shares and service existing accounts. The plans provide for payments, based on an annualized percentage of average daily net assets, ranging from 0.25% to 1.00% as noted below. In some cases, the board of trustees has limited the amounts that may be paid to less than the maximum allowed by the plans. All share classes with a plan may use up to 0.25% of average daily net assets to pay service fees, or to compensate AFD for paying service fees, to firms that have entered into agreements with AFD to provide certain shareholder services. The remaining amounts available to be paid under each plan are paid to dealers to compensate them for their sales activities.

For Classes A and 529-A, distribution-related expenses include the reimbursement of dealer and wholesaler commissions paid by AFD for certain shares sold without a sales charge. These classes reimburse AFD for amounts billed within the prior 15 months but only to the extent that the overall annual expense limit of 0.25% is not exceeded. As of August 31, 2011, there were no unreimbursed expenses subject to reimbursement for Classes A or 529-A

Share classCurrently approved limitsPlan limits
Class A0.25%0.25%
Class 529-A0.250.50
Classes B and 529-B1.001.00
Classes C, 529-C and R-11.001.00
Class R-20.751.00
Classes 529-E and R-30.500.75
Classes F-1, 529-F-1 and R-40.250.50

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

Administrative services – The fund has an administrative services agreement with CRMC for all share classes, except Classes A and B, to provide certain services, including transfer agent and recordkeeping services; coordinating, monitoring, assisting and overseeing third-party service providers; and educating advisers and shareholders about the impact of market-related events, tax laws affecting investments, retirement plan restrictions, exchange limitations and other related matters. Each relevant share class pays CRMC annual fees up to 0.15% (0.10% for Class R-5 and 0.05% for Class R-6) based on its respective average daily net assets. Each relevant share class also pays AFS additional amounts for certain transfer agent services. CRMC and AFS may use these fees to compensate third parties for performing these services.

Each 529 share class is subject to an additional administrative services fee payable to the Commonwealth of Virginia for the maintenance of the 529 college savings plan. The quarterly fee is based on a series of decreasing annual rates beginning with 0.10% on the first $30 billion of the net assets invested in Class 529 shares of the American Funds and decreasing to 0.06% on such assets between $120 billion and $150 billion. The fee for any given calendar quarter is accrued and calculated on the basis of the average net assets of Class 529 shares of the American Funds for the last month of the prior calendar quarter. Although these amounts are included with administrative services fees on the accompanying financial statements, the Commonwealth of Virginia is not considered a related party.

Expenses under the agreements described above for the six months ended August 31, 2011, were as follows (dollars in thousands):
 
        Administrative services 
 
Share class
 Distribution services  Transfer agent services  CRMC administrative services  Transfer agent services  Commonwealth of Virginia administrative services 
Class A $16,791  $10,903  Not applicable  Not applicable  Not applicable 
Class B  2,509   379  Not applicable  Not applicable  Not applicable 
Class C  5,801  
Included
in
administrative services
  $871  $156  Not applicable 
Class F-1  2,014       1,055   65  Not applicable 
Class F-2 Not applicable       573   30  Not applicable 
Class 529-A  669       385   66  $317 
Class 529-B  311       38   12   31 
Class 529-C  841       102   26   84 
Class 529-E  89       19   4   18 
Class 529-F-1  -       20   3   17 
Class R-1  251       34   7  Not applicable 
Class R-2  1,569       314   532  Not applicable 
Class R-3  1,561       456   198  Not applicable 
Class R-4  623       369   7  Not applicable 
Class R-5 Not applicable    436   3  Not applicable 
Class R-6 Not applicable    226   2  Not applicable 
Total $33,029  $11,282  $4,898  $1,111  $467 

Trustees’ deferred compensation – Trustees who are unaffiliated with CRMC may elect to defer the cash payment of part or all of their compensation. These deferred amounts, which remain as liabilities of the fund, are treated as if invested in shares of the fund or other American Funds. These amounts represent general, unsecured liabilities of the fund and vary according to the total returns of the selected funds. Trustees’ compensation of $246,000, shown on the accompanying financial statements, includes $212,000 in current fees (either paid in cash or deferred) and a net increase of $34,000 in the value of the deferred amounts.

Affiliated officers and trustees – Officers and certain trustees of the fund are or may be considered to be affiliated with CRMC, AFS and AFD. No affiliated officers or trustees received any compensation directly from the fund.
 
7.  Capital share transactions
 
Capital share transactions in the fund were as follows (dollars and shares in thousands):
 
  
Sales(*)
  
Reinvestments of
dividends
  
Repurchases(*)
  Net (decrease) increase 
Share class Amount  Shares  Amount  Shares  Amount  Shares  Amount  Shares 
Six months ended August 31, 2011                      
Class A $1,022,156   52,746  $51,984   2,725  $(1,453,957)  (75,066) $(379,817)  (19,595)
Class B  9,360   504   -   -   (116,551)  (6,312)  (107,191)  (5,808)
Class C  77,670   4,220   -   -   (141,272)  (7,708)  (63,602)  (3,488)
Class F-1  218,768   11,364   5,821   306   (241,368)  (12,497)  (16,779)  (827)
Class F-2  238,270   12,222   4,647   244   (77,360)  (4,005)  165,557   8,461 
Class 529-A  60,816   3,151   2,301   121   (33,439)  (1,734)  29,678   1,538 
Class 529-B  1,327   70   -   -   (11,033)  (600)  (9,706)  (530)
Class 529-C  15,008   808   -   -   (11,466)  (619)  3,542   189 
Class 529-E  2,821   148   44   2   (1,959)  (102)  906   48 
Class 529-F-1  6,186   316   191   10   (1,696)  (88)  4,681   238 
Class R-1  8,203   438   -   -   (9,811)  (523)  (1,608)  (85)
Class R-2  50,873   2,720   -   -   (71,404)  (3,821)  (20,531)  (1,101)
Class R-3  88,308   4,594   659   35   (97,973)  (5,103)  (9,006)  (474)
Class R-4  100,120   5,128   1,949   103   (81,174)  (4,177)  20,895   1,054 
Class R-5  110,230   5,579   5,657   296   (118,010)  (6,040)  (2,123)  (165)
Class R-6  164,493   8,387   6,260   327   (50,023)  (2,579)  120,730   6,135 
Total net increase                                
   (decrease) $2,174,609   112,395  $79,513   4,169  $(2,518,496)  (130,974) $(264,374)  (14,410)
                                 
                                 
Year ended February 28, 2011                             
Class A $2,000,982   112,471  $59,720   3,604  $(2,562,651)  (147,165) $(501,949)  (31,090)
Class B  27,429   1,596   -   -   (195,392)  (11,718)  (167,963)  (10,122)
Class C  164,411   9,704   -   -   (222,901)  (13,526)  (58,490)  (3,822)
Class F-1  429,620   24,635   6,742   408   (482,794)  (27,968)  (46,432)  (2,925)
Class F-2  283,646   16,180   2,814   169   (93,706)  (5,314)  192,754   11,035 
Class 529-A  103,809   5,854   2,323   141   (52,176)  (3,003)  53,956   2,992 
Class 529-B  2,107   123   -   -   (17,994)  (1,072)  (15,887)  (949)
Class 529-C  26,874   1,580   -   -   (19,070)  (1,144)  7,804   436 
Class 529-E  5,485   316   62   4   (3,196)  (186)  2,351   134 
Class 529-F-1  9,697   543   133   8   (3,283)  (187)  6,547   364 
Class R-1  13,989   826   -   -   (10,944)  (649)  3,045   177 
Class R-2  100,679   5,914   -   -   (120,987)  (7,211)  (20,308)  (1,297)
Class R-3  162,268   9,294   1,121   69   (175,134)  (10,158)  (11,745)  (795)
Class R-4  125,456   7,182   1,910   116   (92,203)  (5,274)  35,163   2,024 
Class R-5  146,132   8,206   5,716   344   (163,403)  (9,363)  (11,555)  (813)
Class R-6  389,400   21,703   3,281   198   (33,838)  (1,890)  358,843   20,011 
Total net increase                                
   (decrease) $3,991,984   226,127  $83,822   5,061  $(4,249,672)  (245,828) $(173,866)  (14,640)
                                 
                                 
*Includes exchanges between share classes of the fund.
                     
 
8.  Investment transactions
 
The fund made purchases and sales of investment securities, excluding short-term securities and U.S. government obligations, if any, of $3,055,440,000 and $3,584,660,000, respectively, during the six months ended August 31, 2011.

Financial highlights(1)
 
      
(Loss) income from investment operations(2)
  Dividends and distributions                   
   Net asset value, beginning of period  Net investment income (loss)  Net (losses) gains on securities (both realized and unrealized)  Total from investment operations  Dividends (from net investment income)  Distributions (from capital gains)  Total dividends and distributions  Net asset value, end of period  
Total
return(3)(4)
  Net assets, end of period (in millions)  
Ratio of expenses to average net assets before reimbursements/
waivers
  
Ratio of expenses to average net assets after reimbursements/
waivers(4)
  
Ratio of net income (loss) to average net assets(4)
 
                                         
Class A:
Six months ended 8/31/2011(5)
 $19.78  $.05  $(1.31) $(1.26) $(.07) $-  $(.07) $18.45   (6.37)% $13,531   .72%⁽⁶⁾  .72%⁽⁶⁾  .54%⁽⁶⁾
 Year ended 2/28/2011  16.55   .08   3.23   3.31   (.08)  -   (.08)  19.78   20.09   14,891   .73   .73   .48 
 Year ended 2/28/2010  10.44   .08   6.19   6.27   (.16)  -   (.16)  16.55   60.46   12,973   .78   .78   .57 
 Year ended 2/28/2009  18.41   .16   (7.43)  (7.27)  -   (.70)  (.70)  10.44   (40.97)  8,687   .74   .71   1.03 
 Year ended 2/29/2008  20.29   .25   (.77)  (.52)  (.24)  (1.12)  (1.36)  18.41   (3.14)  16,387   .68   .65   1.21 
 Year ended 2/28/2007  19.48   .18   1.37   1.55   (.16)  (.58)  (.74)  20.29   8.07   17,341   .68   .65   .91 
                                                      
Class B:
Six months ended 8/31/2011(5)
  18.89   (.02)  (1.25)  (1.27)  -   -   -   17.62   (6.72)  422   1.49⁽⁶⁾   1.49⁽⁶⁾   (.23)⁽⁶⁾
 Year ended 2/28/2011  15.85   (.05)  3.09   3.04   -   -   -   18.89   19.18   562   1.50   1.50   (.29)
 Year ended 2/28/2010  9.98   (.03)  5.93   5.90   (.03)  -   (.03)  15.85   59.16   632   1.55   1.55   (.20)
 Year ended 2/28/2009  17.75   .04   (7.11)  (7.07)  -   (.70)  (.70)  9.98   (41.38)  499   1.50   1.48   .26 
 Year ended 2/29/2008  19.59   .09   (.76)  (.67)  (.05)  (1.12)  (1.17)  17.75   (3.92)  1,031   1.45   1.42   .44 
 Year ended 2/28/2007  18.83   .02   1.32   1.34   -   (.58)  (.58)  19.59   7.23   1,163   1.46   1.42   .13 
                                                      
Class C:
Six months ended 8/31/2011(5)
  18.74   (.02)  (1.25)  (1.27)  -   -   -   17.47   (6.78)  1,056   1.52⁽⁶⁾   1.52⁽⁶⁾   (.25)⁽⁶⁾
 Year ended 2/28/2011  15.72   (.05)  3.07   3.02   -   -   -   18.74   19.21   1,197   1.52   1.52   (.31)
 Year ended 2/28/2010  9.90   (.03)  5.88   5.85   (.03)  -   (.03)  15.72   59.18   1,065   1.56   1.56   (.21)
 Year ended 2/28/2009  17.63   .03   (7.06)  (7.03)  -   (.70)  (.70)  9.90   (41.44)  736   1.52   1.49   .24 
 Year ended 2/29/2008  19.46   .08   (.74)  (.66)  (.05)  (1.12)  (1.17)  17.63   (3.93)  1,519   1.50   1.47   .39 
 Year ended 2/28/2007  18.72   .01   1.31   1.32   -   (.58)  (.58)  19.46   7.16   1,667   1.51   1.48   .07 
                                                      
Class F-1:
Six months ended 8/31/2011(5)
  19.69   .05   (1.30)  (1.25)  (.07)  -   (.07)  18.37   (6.34)  1,515   .73⁽⁶⁾   .73⁽⁶⁾   .54⁽⁶⁾ 
 Year ended 2/28/2011  16.48   .08   3.22   3.30   (.09)  -   (.09)  19.69   20.10   1,641   .72   .72   .48 
 Year ended 2/28/2010  10.39   .09   6.16   6.25   (.16)  -   (.16)  16.48   60.46   1,421   .74   .74   .61 
 Year ended 2/28/2009  18.31   .16   (7.38)  (7.22)  -   (.70)  (.70)  10.39   (40.92)  1,077   .70   .67   1.06 
 Year ended 2/29/2008  20.20   .25   (.78)  (.53)  (.24)  (1.12)  (1.36)  18.31   (3.19)  2,492   .68   .65   1.20 
 Year ended 2/28/2007  19.40   .18   1.36   1.54   (.16)  (.58)  (.74)  20.20   8.06   2,506   .68   .65   .90 
                                                      
Class F-2:
Six months ended 8/31/2011(5)
  19.83   .08   (1.31)  (1.23)  (.12)  -   (.12)  18.48   (6.20)  768   .49⁽⁶⁾   .49⁽⁶⁾   .78⁽⁶⁾ 
 Year ended 2/28/2011  16.60   .12   3.24   3.36   (.13)  -   (.13)  19.83   20.38   657   .49   .49   .71 
 Year ended 2/28/2010  10.46   .12   6.20   6.32   (.18)  -   (.18)  16.60   60.82   367   .52   .52   .79 
 Period from 8/1/2008 to 2/28/2009  16.52   .10   (6.16)  (6.06)  -   -   -   10.46   (36.68)  87   .50(6)  .48(6)  1.50(6)
                                                      
Class 529-A:
Six months ended 8/31/2011(5)
  19.70   .05   (1.31)  (1.26)  (.07)  -   (.07)  18.37   (6.41)  612   .80⁽⁶⁾   .80⁽⁶⁾   .47⁽⁶⁾ 
 Year ended 2/28/2011  16.49   .07   3.22   3.29   (.08)  -   (.08)  19.70   20.03   626   .79   .79   .41 
 Year ended 2/28/2010  10.41   .08   6.17   6.25   (.17)  -   (.17)  16.49   60.35   474   .83   .83   .51 
 Year ended 2/28/2009  18.36   .15   (7.40)  (7.25)  -   (.70)  (.70)  10.41   (40.97)  287   .79   .76   .98 
 Year ended 2/29/2008  20.25   .23   (.78)  (.55)  (.22)  (1.12)  (1.34)  18.36   (3.26)  467   .76   .73   1.12 
 Year ended 2/28/2007  19.45   .17   1.36   1.53   (.15)  (.58)  (.73)  20.25   7.99   432   .74   .71   .84 
                                                      
Class 529-B:
Six months ended 8/31/2011(5)
  18.87   (.03)  (1.24)  (1.27)  -   -   -   17.60   (6.73)  54   1.60⁽⁶⁾   1.60⁽⁶⁾   (.34)⁽⁶⁾
 Year ended 2/28/2011  15.85   (.06)  3.08   3.02   -   -   -   18.87   19.05   68   1.59   1.59   (.38)
 Year ended 2/28/2010  10.00   (.04)  5.93   5.89   (.04)  -   (.04)  15.85   59.02   72   1.64   1.64   (.29)
 Year ended 2/28/2009  17.81   .02   (7.13)  (7.11)  -   (.70)  (.70)  10.00   (41.47)  48   1.60   1.57   .17 
 Year ended 2/29/2008  19.65   .06   (.74)  (.68)  (.04)  (1.12)  (1.16)  17.81   (3.99)  84   1.57   1.54   .31 
 Year ended 2/28/2007  18.91   -(7)  1.32   1.32   -   (.58)  (.58)  19.65   7.09   84   1.57   1.54   .01 
                                                      
Class 529-C:
Six months ended 8/31/2011(5)
  18.88   (.03)  (1.24)  (1.27)  -   -   -   17.61   (6.73)  160   1.59⁽⁶⁾   1.59⁽⁶⁾   (.32)⁽⁶⁾
 Year ended 2/28/2011  15.86   (.06)  3.08   3.02   -   -   -   18.88   19.04   168   1.58   1.58   (.38)
 Year ended 2/28/2010  10.00   (.04)  5.95   5.91   (.05)  -   (.05)  15.86   59.02   134   1.63   1.63   (.28)
 Year ended 2/28/2009  17.82   .03   (7.15)  (7.12)  -   (.70)  (.70)  10.00   (41.44)  83   1.59   1.57   .17 
 Year ended 2/29/2008  19.67   .06   (.74)  (.68)�� (.05)  (1.12)  (1.17)  17.82   (4.00)  144   1.57   1.54   .31 
 Year ended 2/28/2007  18.93   -(7)  1.32   1.32   -   (.58)  (.58)  19.67   7.08   136   1.56   1.53   .02 
                                                      
Class 529-E:
Six months ended 8/31/2011(5)
 $19.44  $.02  $(1.29) $(1.27) $(.02) $-  $(.02) $18.15   (6.52)% $34   1.07%⁽⁶⁾  1.07%⁽⁶⁾  .20%⁽⁶⁾
 Year ended 2/28/2011  16.28   .02   3.18   3.20   (.04)  -   (.04)  19.44   19.68   35   1.08   1.08   .13 
 Year ended 2/28/2010  10.28   .03   6.10   6.13   (.13)  -   (.13)  16.28   59.86   27   1.13   1.13   .22 
 Year ended 2/28/2009  18.20   .10   (7.32)  (7.22)  -   (.70)  (.70)  10.28   (41.17)  17   1.09   1.06   .69 
 Year ended 2/29/2008  20.07   .17   (.76)  (.59)  (.16)  (1.12)  (1.28)  18.20   (3.50)  27   1.06   1.03   .82 
 Year ended 2/28/2007  19.28   .10   1.35   1.45   (.08)  (.58)  (.66)  20.07   7.66   25   1.05   1.02   .54 
                                                      
Class 529-F-1:
Six months ended 8/31/2011(5)
  19.74   .07   (1.31)  (1.24)  (.11)  -   (.11)  18.39   (6.30)  33   .58⁽⁶⁾   .58⁽⁶⁾   .69⁽⁶⁾ 
 Year ended 2/28/2011  16.52   .11   3.22   3.33   (.11)  -   (.11)  19.74   20.27   31   .58   .58   .62 
 Year ended 2/28/2010  10.43   .11   6.18   6.29   (.20)  -   (.20)  16.52   60.70   20   .63   .63   .72 
 Year ended 2/28/2009  18.36   .18   (7.41)  (7.23)  -   (.70)  (.70)  10.43   (40.86)  12   .59   .56   1.18 
 Year ended 2/29/2008  20.26   .27   (.77)  (.50)  (.28)  (1.12)  (1.40)  18.36   (3.07)  18   .56   .53   1.30 
 Year ended 2/28/2007  19.46   .20   1.37   1.57   (.19)  (.58)  (.77)  20.26   8.20   14   .55   .52   1.04 
                                                      
Class R-1:
Six months ended 8/31/2011(5)
  19.06   (.02)  (1.26)  (1.28)  -   -   -   17.78   (6.72)  46   1.50⁽⁶⁾   1.50⁽⁶⁾   (.23)⁽⁶⁾
 Year ended 2/28/2011  15.99   (.05)  3.12   3.07   -   -   -   19.06   19.20   51   1.50   1.50   (.29)
 Year ended 2/28/2010  10.09   (.03)  6.00   5.97   (.07)  -   (.07)  15.99   59.14   40   1.53   1.53   (.19)
 Year ended 2/28/2009  17.95   .04   (7.20)  (7.16)  -   (.70)  (.70)  10.09   (41.36)  24   1.48   1.45   .29 
 Year ended 2/29/2008  19.80   .08   (.76)  (.68)  (.05)  (1.12)  (1.17)  17.95   (3.93)  40   1.50   1.47   .39 
 Year ended 2/28/2007  19.04   .02   1.32   1.34   -   (.58)  (.58)  19.80   7.14   43   1.50   1.47   .09 
                                                      
Class R-2:
Six months ended 8/31/2011(5)
  19.03   (.02)  (1.25)  (1.27)  -   -   -   17.76   (6.67)  383   1.49⁽⁶⁾   1.49⁽⁶⁾   (.23)⁽⁶⁾
 Year ended 2/28/2011  15.97   (.05)  3.11   3.06   -   -   -   19.03   19.16   431   1.50   1.50   (.30)
 Year ended 2/28/2010  10.08   (.04)  5.98   5.94   (.05)  -   (.05)  15.97   59.02   383   1.60   1.60   (.25)
 Year ended 2/28/2009  17.94   .03   (7.19)  (7.16)  -   (.70)  (.70)  10.08   (41.44)  238   1.59   1.57   .17 
 Year ended 2/29/2008  19.79   .08   (.76)  (.68)  (.05)  (1.12)  (1.17)  17.94   (3.95)  415   1.53   1.47   .38 
 Year ended 2/28/2007  19.03   .02   1.32   1.34   -   (.58)  (.58)  19.79   7.15   427   1.59   1.46   .09 
                                                      
Class R-3:
Six months ended 8/31/2011(5)
  19.50   .02   (1.28)  (1.26)  (.02)  -   (.02)  18.22   (6.46)  580   1.05⁽⁶⁾   1.05⁽⁶⁾   .22⁽⁶⁾ 
 Year ended 2/28/2011  16.33   .03   3.17   3.20   (.03)  -   (.03)  19.50   19.66   631   1.05   1.05   .16 
 Year ended 2/28/2010  10.29   .04   6.11   6.15   (.11)  -   (.11)  16.33   60.02   541   1.08   1.08   .27 
 Year ended 2/28/2009  18.21   .11   (7.33)  (7.22)  -   (.70)  (.70)  10.29   (41.15)  349   1.05   1.02   .70 
 Year ended 2/29/2008  20.08   .18   (.78)  (.60)  (.15)  (1.12)  (1.27)  18.21   (3.51)  724   1.04   1.01   .85 
 Year ended 2/28/2007  19.28   .11   1.35   1.46   (.08)  (.58)  (.66)  20.08   7.68   747   1.04   1.01   .55 
                                                      
Class R-4:
Six months ended 8/31/2011(5)
  19.68   .05   (1.29)  (1.24)  (.08)  -   (.08)  18.36   (6.33)  477   .74⁽⁶⁾   .74⁽⁶⁾   .53⁽⁶⁾ 
 Year ended 2/28/2011  16.47   .08   3.21   3.29   (.08)  -   (.08)  19.68   20.07   491   .74   .74   .46 
 Year ended 2/28/2010  10.40   .08   6.16   6.24   (.17)  -   (.17)  16.47   60.42   378   .77   .77   .57 
 Year ended 2/28/2009  18.33   .16   (7.39)  (7.23)  -   (.70)  (.70)  10.40   (40.93)  252   .73   .70   1.04 
 Year ended 2/29/2008  20.22   .24   (.78)  (.54)  (.23)  (1.12)  (1.35)  18.33   (3.22)  528   .73   .70   1.16 
 Year ended 2/28/2007  19.42   .17   1.35   1.52   (.14)  (.58)  (.72)  20.22   7.97   555   .73   .70   .85 
                                                      
Class R-5:
Six months ended 8/31/2011(5)
  19.89   .08   (1.32)  (1.24)  (.12)  -   (.12)  18.53   (6.23)  808   .44⁽⁶⁾   .44⁽⁶⁾   .83⁽⁶⁾ 
 Year ended 2/28/2011  16.64   .13   3.25   3.38   (.13)  -   (.13)  19.89   20.45   870   .44   .44   .77 
 Year ended 2/28/2010  10.50   .13   6.22   6.35   (.21)  -   (.21)  16.64   60.97   741   .47   .47   .89 
 Year ended 2/28/2009  18.45   .20   (7.45)  (7.25)  -   (.70)  (.70)  10.50   (40.77)  619   .43   .40   1.35 
 Year ended 2/29/2008  20.35   .30   (.77)  (.47)  (.31)  (1.12)  (1.43)  18.45   (2.93)  787   .43   .40   1.43 
 Year ended 2/28/2007  19.55   .23   1.36   1.59   (.21)  (.58)  (.79)  20.35   8.29   514   .43   .40   1.15 
                                                      
Class R-6:
Six months ended 8/31/2011(5)
  19.85   .09   (1.31)  (1.22)  (.14)  -   (.14)  18.49   (6.19)  906   .39⁽⁶⁾   .39⁽⁶⁾   .88⁽⁶⁾ 
 Year ended 2/28/2011  16.60   .14   3.24   3.38   (.13)  -   (.13)  19.85   20.50   851   .39   .39   .80 
 Period from 5/1/2009 to 2/28/2010  13.04   .11   3.61   3.72   (.16)  -   (.16)  16.60   28.85   380   .42(6)  .42(6)  .90(6)

 
  
Six months ended
August 31,
  Year ended February 28 or 29 
  
2011(5)
  2011  2010  2009  2008  2007 
                   
Portfolio turnover rate for all share classes  15%  28%  29%  37%  29%  20%
 
 
(1)Based on operations for the periods shown (unless otherwise noted) and, accordingly, may not be representative of a full year.
      
(2)Based on average shares outstanding.
            
(3)Total returns exclude any applicable sales charges, including contingent deferred sales charges.
        
(4)This column reflects the impact, if any, of certain reimbursements/waivers from CRMC. During some of the periods shown, CRMC reduced fees for investment advisory services. In addition, during some of the periods shown, CRMC paid a portion of the fund's transfer agent fees for certain retirement plan share classes.
(5)Unaudited.
             
(6)Annualized.
             
(7)Amount less than $.01.
            
              
See Notes to Financial Statements            
 
 
 
Expense example           
                                                                                                                                          unaudited
 
As a shareholder of the fund, you incur two types of costs: (1) transaction costs, such as initial sales charges on purchase payments and contingent deferred sales charges on redemptions (loads), and (2) ongoing costs, including management fees, distribution and service (12b-1) fees, and other expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the fund so you can compare these costs with the ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire six-month period (March 1, 2011, through August 31, 2011).
 
Actual expenses:
The first line of each share class in the table on the next page provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled "Expenses paid during period" to estimate the expenses you paid on your account during this period.
 
Hypothetical example for comparison purposes:
The second line of each share class in the table on the next page provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio for the share class and an assumed rate of return of 5.00% per year before expenses, which is not the actual return of the share class. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the fund and other funds. To do so, compare this 5.00% hypothetical example with the 5.00% hypothetical examples that appear in the shareholder reports of the other funds.
 
Notes:
There are some account fees that are charged to certain types of accounts, such as individual retirement accounts and 529 college savings plan accounts (generally, a $10 fee is charged to set up the account and an additional $10 fee is charged to the account annually), that would increase the amount of expenses paid on your account. In addition, retirement plan participants may be subject to certain fees charged by the plan sponsor, and Class F-1, F-2 and 529-F-1 shareholders may be subject to fees charged by financial intermediaries, typically ranging from 0.75% to 1.50% of assets annually depending on services offered. You can estimate the impact of these fees by adding the amount of the fees to the total estimated expenses you paid on your account during the period as calculated above. In addition, your ending account value would be lower by the amount of these fees.
 
Note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads). Therefore, the second line of each share class in the table is useful in comparing ongoing costs only and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
 
  Beginning account value 3/1/2011  Ending account value 8/31/2011  Expenses paid during period*  
Annualized
expense ratio
 
             
Class A -- actual return $1,000.00  $936.28  $3.51   .72%
Class A -- assumed 5% return  1,000.00   1,021.58   3.67   .72 
Class B -- actual return  1,000.00   932.77   7.26   1.49 
Class B -- assumed 5% return  1,000.00   1,017.69   7.58   1.49 
Class C -- actual return  1,000.00   932.23   7.40   1.52 
Class C -- assumed 5% return  1,000.00   1,017.54   7.73   1.52 
Class F-1 -- actual return  1,000.00   936.59   3.56   .73 
Class F-1 -- assumed 5% return  1,000.00   1,021.53   3.72   .73 
Class F-2 -- actual return  1,000.00   937.99   2.39   .49 
Class F-2 -- assumed 5% return  1,000.00   1,022.74   2.50   .49 
Class 529-A -- actual return  1,000.00   935.91   3.90   .80 
Class 529-A -- assumed 5% return  1,000.00   1,021.17   4.08   .80 
Class 529-B -- actual return  1,000.00   932.69   7.79   1.60 
Class 529-B -- assumed 5% return  1,000.00   1,017.14   8.13   1.60 
Class 529-C -- actual return  1,000.00   932.73   7.75   1.59 
Class 529-C -- assumed 5% return  1,000.00   1,017.19   8.08   1.59 
Class 529-E -- actual return  1,000.00   934.83   5.22   1.07 
Class 529-E -- assumed 5% return  1,000.00   1,019.81   5.45   1.07 
Class 529-F-1 -- actual return  1,000.00   937.03   2.83   .58 
Class 529-F-1 -- assumed 5% return  1,000.00   1,022.28   2.96   .58 
Class R-1 -- actual return  1,000.00   932.85   7.31   1.50 
Class R-1 -- assumed 5% return  1,000.00   1,017.64   7.63   1.50 
Class R-2 -- actual return  1,000.00   933.27   7.26   1.49 
Class R-2 -- assumed 5% return  1,000.00   1,017.69   7.58   1.49 
Class R-3 -- actual return  1,000.00   935.36   5.12   1.05 
Class R-3 -- assumed 5% return  1,000.00   1,019.91   5.35   1.05 
Class R-4 -- actual return  1,000.00   936.67   3.61   .74 
Class R-4 -- assumed 5% return  1,000.00   1,021.48   3.77   .74 
Class R-5 -- actual return  1,000.00   937.71   2.15   .44 
Class R-5 -- assumed 5% return  1,000.00   1,022.99   2.24   .44 
Class R-6 -- actual return  1,000.00   938.11   1.91   .39 
Class R-6 -- assumed 5% return  1,000.00   1,023.24   1.99   .39 
                 
*The “expenses paid during period” are equal to the “annualized expense ratio,” multiplied by the average account value over the period, multiplied by the number of days in the period, and divided by 366 (to reflect the one-half year period).
 
 
 
Other share class results
unaudited
 
Classes B, C, F and 529

Fund results shown are for past periods and are not predictive of results for future periods. Current and future results may be lower or higher than those shown. Share prices and returns will vary, so investors may lose money. For current information and month-end results, visit americanfunds.com.

Average annual total returns for periods ended       
10 years1/
 
September 30, 2011 (the most recent calendar quarter-end): 1 year  5 years  Life of class 
          
Class B shares2
         
Reflecting applicable contingent deferred sales charge         
(CDSC), maximum of 5%, payable only if shares         
are sold within six years of purchase  –4.32%  –0.70%  3.33%
Not reflecting CDSC  0.68   –0.34   3.33 
             
Class C shares            
Reflecting CDSC, maximum of 1%, payable only            
if shares are sold within one year of purchase  –0.32   –0.36   3.13 
Not reflecting CDSC  0.68   –0.36   3.13 
             
Class F-1 shares3
            
Not reflecting annual asset-based fee charged            
by sponsoring firm  1.46   0.44   3.95 
             
Class F-2 shares3 — first sold 8/1/08
            
Not reflecting annual asset-based fee charged            
by sponsoring firm  1.72      2.05 
             
Class 529-A shares4 — first sold 2/15/02
            
Reflecting 5.75% maximum sales charge  –4.45   –0.81   2.55 
Not reflecting maximum sales charge  1.38   0.37   3.18 
             
Class 529-B shares2,4 — first sold 2/19/02
            
Reflecting applicable CDSC, maximum of 5%, payable            
only if shares are sold within six years of purchase  –4.45   –0.80   2.64 
Not reflecting CDSC  0.55   –0.44   2.64 
             
Class 529-C shares4 — first sold 2/19/02
            
Reflecting CDSC, maximum of 1%, payable only            
if shares are sold within one year of purchase  –0.38   –0.43   2.51 
Not reflecting CDSC  0.62   –0.43   2.51 
             
Class 529-E shares3,4 — first sold 3/7/02
  1.09   0.07   2.46 
             
Class 529-F-1 shares3,4 — first sold 9/17/02
            
Not reflecting annual asset-based fee charged            
by sponsoring firm  1.59   0.57   5.63 


 
1Applicable to Classes B, C and F-1 shares only. All other share classes reflect results for the life of the class.
 
2These shares are not available for purchase.
 
3These shares are sold without any initial or contingent deferred sales charge.
 
4Results shown do not reflect the $10 account setup fee and an annual $10 account maintenance fee.

Investment results assume all distributions are reinvested and reflect applicable fees and expenses. The fund’s investment adviser waived a portion of its management fees from September 1, 2004, through December 31, 2008. Applicable fund results shown reflect the waiver, without which they would have been lower. See the Financial Highlights table on pages 22 to 28 for details that include expense ratios for all share classes.

For information regarding the differences among the various share classes, refer to the fund’s prospectus.


Approval of Investment Advisory and Service Agreement

The fund’s board has approved the fund’s Investment Advisory and Service Agreement (the “agreement”) with Capital Research and Management Company (“CRMC”) for an additional one-year term through March 31, 2012. The board approved the agreement following the recommendation of the fund’s Contracts Committee (the “committee”), which is composed of all of the fund’s independent board members. The board and the committee determined that the fund’s advisory fee structure was fair and reasonable in relation to the services provided and that approving the agreement was in the best interests of the fund and its shareholders.

In reaching this decision, the board and the committee took into account information furnished to them throughout the year, as well as information prepared specifically in connection with their review of the agreement and were advised by their independent counsel. They considered the factors discussed below, among others, but did not identify any single issue or particular piece of information that, in isolation, was the controlling factor.

1. Nature, extent and quality of services

The board and the committee considered the depth and quality of CRMC’s investment management process, including its global research capabilities; the experience, capability and integrity of its senior management and other personnel; the low turnover rates of its key personnel; the overall financial strength and stability of its organization; and the ongoing evolution of CRMC’s organizational structure designed to maintain and strengthen these qualities. The board and the committee also considered the nature, extent and quality of administrative, compliance and shareholder services provided by CRMC to the fund under the agreement and other agreements as well as the benefits to fund shareholders from investing in a fund that is part of a large family of funds. The board and the committee concluded that the nature, extent and quality of the services provided by CRMC have benefited and should continue to benefit the fund and its shareholders.

2. Investment results

The board and the committee considered the investment results of the fund in light of its objective of providing long-term growth of capital. They compared the fund’s total returns with those of other relevant funds (including the other funds that are the basis of the Lipper index for the category in which the fund is included) and market data such as relevant market indices, in each case as available at the time of the related board and committee meetings. This report, including the letter to shareholders and related disclosures, contains certain information about the fund’s investment results. The board and the committee concluded that the fund’s long-term results have been satisfactory and that CRMC’s record in managing the fund indicated that its continued management should benefit the fund and its shareholders.

3. Advisory fees and total expenses

The board and the committee compared the advisory fees and total expense levels of the fund to those of other relevant funds. They observed that the fund’s advisory fees and expenses remain significantly below those of most other relevant funds. The board and the committee also noted the breakpoint discounts in the fund’s advisory fee structure that reduce the level of fees charged by CRMC to the fund as fund assets increase. In addition, they reviewed information regarding the advisory fees paid by clients of an affiliate of CRMC. They noted that, to the extent there were differences between the advisory fees paid by the fund and the advisory fees paid by those clients, the differences appropriately reflected the investment, operational and regulatory differences between advising the fund and the other clients. The board and the committee concluded that the fund’s cost structure was fair and reasonable in relation to the services provided, and that the shareholders receive reasonable value in return for the advisory fees and other amounts paid to CRMC by the fund.

4. Ancillary benefits

The board and the committee considered a variety of other benefits received by CRMC and its affiliates as a result of CRMC’s relationship with the fund and the other American Funds, including fees for administrative services provided to certain share classes; fees paid to CRMC’s affiliated transfer agent; sales charges and distribution fees received and retained by the fund’s principal underwriter, an affiliate of CRMC; and possible ancillary benefits to CRMC’s institutional management affiliates. The board and the committee reviewed CRMC’s portfolio trading practices, noting that while CRMC receives the benefit of research provided by broker-dealers executing portfolio transactions on behalf of the fund, it does not obtain third-party research or other services in return for allocating brokerage to such broker-dealers. The board and the committee took these ancillary benefits into account in evaluating the reasonableness of the advisory fees and other amounts paid to CRMC by the fund.

5. Adviser financial information

The board and the committee reviewed information regarding CRMC’s costs of providing services to the American Funds, including personnel, systems and resources of investment, compliance, trading, accounting and other administrative operations. They considered CRMC’s costs and willingness to invest in technology, infrastructure and staff to maintain and expand services and capabilities, respond to industry and regulatory developments and attract and retain qualified personnel. They noted information regarding the compensation structure for CRMC’s investment professionals. The board and the committee also compared CRMC’s profitability to the reported results of several large, publicly held investment management companies. The board and the committee noted the competitiveness and cyclicality of both the mutual fund industry and the capital markets, and the importance in that environment of CRMC’s long-term profitability for maintaining its independence, company culture and management continuity. They further considered the breakpoint discounts in the fund’s advisory fee structure. The board and the committee concluded that the fund’s advisory fee structure reflected a reasonable sharing of benefits between CRMC and the fund’s shareholders.


Offices of the fund and of the investment adviser
Capital Research and Management Company
333 South Hope Street
Los Angeles, CA 90071-1406

6455 Irvine Center Drive
Irvine, CA 92618

Transfer agent for shareholder accounts
American Funds Service Company
(Write to the address near you.)

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

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

Custodian of assets
JPMorgan Chase Bank
270 Park Avenue
New York, NY 10017-2070

Counsel
O’Melveny & Myers LLP
400 South Hope Street
Los Angeles, CA 90071-2899

Independent registered public accounting firm
Deloitte & Touche LLP
695 Town Center Drive
Suite 1200
Costa Mesa, CA 92626-7188

Principal underwriter
American Funds Distributors, Inc.
333 South Hope Street
Los Angeles, CA 90071-1406

Investors should carefully consider the investment objectives, risks, charges and expenses of the American Funds. This and other important information is contained in the fund’s prospectus and summary prospectus, which can be obtained from your financial professional and should be read carefully before investing. You may also call American Funds Service Company (AFS) at 800/421-0180 or visit the American Funds website at americanfunds.com.
 
“American Funds Proxy Voting Procedures and Principles” — which describes how we vote proxies relating to portfolio securities — is available on the American Funds website or upon request by calling AFS. The fund files its proxy voting record with the U.S. Securities and Exchange Commission (SEC) for the 12 months ended June 30 by August 31. The proxy voting record is available free of charge on the SEC website at sec.gov and on the American Funds website.

A complete August 31, 2011, portfolio of AMCAP Fund’s investments is available free of charge by calling AFS or visiting the SEC website (where it is part of Form N-CSR).

AMCAP Fund files a complete list of its portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. This filing is available free of charge on the SEC website. You may also review or, for a fee, copy this filing at the SEC’s Public Reference Room in Washington, D.C. Additional information regarding the operation of the Public Reference Room may be obtained by calling the SEC’s Office of Investor Education and Advocacy at 800/SEC-0330. Additionally, the list of portfolio holdings is available by calling AFS.

This report is for the information of shareholders of AMCAP Fund, but it also may be used as sales literature when preceded or accompanied by the current prospectus or summary prospectus, which gives details about charges, expenses, investment objectives and operating policies of the fund. If used as sales material after December 31, 2011, this report must be accompanied by an American Funds statistical update for the most recently completed calendar quarter.

 
 
 
 
The American Funds difference

Since 1931, American Funds has helped investors pursue long-term investment success. Our consistent approach — in combination with a proven system — has resulted in a superior long-term track record.

Consistent approach

We base our decisions on a long-term perspective because we believe it is the best way to achieve superior long-term investment results. Our portfolio counselors average 27 years of investment experience, including 22 years at our company, reflecting a career commitment to our long-term approach.

Proven system

Our system combines individual accountability with teamwork. Each fund is divided into portions that are managed by investment professionals with varied backgrounds, ages and investment styles. An extensive global research effort is the backbone of our system.

Superior long-term track record

Our equity funds have beaten their Lipper peer indexes in 89% of 10-year periods and 96% of 20-year periods. Our fixed-income funds have beaten their Lipper indexes in 65% of 10-year periods and 75% of 20-year periods.* Our fund management fees have consistently been among the lowest in the industry.

 *Based on Class A share results for periods through 12/31/10. Periods covered are the shorter of the fund’s lifetime or since the comparable Lipper index inception date.
 
Based on management fees for the 20-year period ended 12/31/10 versus comparable Lipper categories, excluding funds of funds.


American Funds span a range of investment objectives

 •Growth funds
 
>AMCAP Fund®
 
EuroPacific Growth Fund®
 
The Growth Fund of America®
 
The New Economy Fund®
 
New Perspective Fund®
 
New World Fund®
 
SMALLCAP World Fund®

 •Growth-and-income funds
 
American Mutual Fund®
 
Capital World Growth and Income FundSM
 
Fundamental InvestorsSM
 
International Growth and Income FundSM
 
The Investment Company of America®
 
Washington Mutual Investors FundSM

 •Equity-income funds
 
Capital Income Builder®
 
The Income Fund of America®

 •Balanced funds
 
American Balanced Fund®
 
American Funds Global Balanced FundSM

 •Bond funds
 
American Funds Mortgage FundSM
 
American High-Income TrustSM
 
The Bond Fund of AmericaSM
 
Capital World Bond Fund®
 
Intermediate Bond Fund of America®
 
Short-Term Bond Fund of AmericaSM
 
U.S. Government Securities FundSM

 •Tax-exempt bond funds
 
American Funds Short-Term Tax-Exempt Bond FundSM
 
American High-Income Municipal Bond Fund®
 
Limited Term Tax-Exempt Bond Fund of AmericaSM
 
The Tax-Exempt Bond Fund of America®
 State-specific tax-exempt funds
 
American Funds Tax-Exempt Fund of New YorkSM
 
The Tax-Exempt Fund of California®
 
The Tax-Exempt Fund of Maryland®
 
The Tax-Exempt Fund of Virginia®

 •Money market fund
 
American Funds Money Market Fund®

 
•American Funds Target Date Retirement Series®



The Capital Group Companies

American Funds   Capital Research and Management   Capital International   Capital Guardian   Capital Bank and Trust



Lit. No. MFGESR-902-1011P
 
Litho in USA AGD/ALD/8078-S28716
 
Printed on paper containing 10% post-consumer waste
 
Printed with inks containing soy and/or vegetable oil
 
 
ITEM 2 – Code of Ethics

Not applicable for filing of semi-annual reports to shareholders.


ITEM 3 – Audit Committee Financial Expert

Not applicable for filing of semi-annual reports to shareholders.


ITEM 4 – Principal Accountant Fees and Services

Not applicable for filing of semi-annual reports to shareholders.


ITEM 5 – Audit Committee of Listed Registrants

Not applicable to this Registrant, insofar as the Registrant is not a listed issuer as defined in Rule 10A-3 under the Securities Exchange Act of 1934.


ITEM 6 – Schedule of Investments
 
 
 
 
AMCAP Fund® 
Investment portfolio
 
August 31, 2011
unaudited

Common stocks — 88.91% Shares  
Value
(000)
 
       
INFORMATION TECHNOLOGY — 20.03%      
Microsoft Corp.  26,045,000  $692,797 
Apple Inc.1
  1,490,000   573,397 
Yahoo! Inc.1
  21,903,800   298,001 
Corning Inc.  17,100,000   257,013 
Oracle Corp.  9,120,000   255,998 
MasterCard Inc., Class A  750,000   247,282 
QUALCOMM Inc.  3,800,000   195,548 
Accenture PLC, Class A  3,250,000   174,167 
Automatic Data Processing, Inc.  2,975,000   148,839 
Hewlett-Packard Co.  5,550,000   144,466 
Rovi Corp.1
  2,800,000   136,892 
eBay Inc.1
  4,050,000   125,023 
Avago Technologies Ltd.  3,724,200   123,308 
Texas Instruments Inc.  4,470,000   117,159 
Trimble Navigation Ltd.1
  2,790,000   103,621 
Logitech International SA1
  8,678,600   100,585 
Cisco Systems, Inc.  6,085,300   95,418 
Autodesk, Inc.1
  2,660,000   75,012 
EMC Corp.1
  3,150,000   71,159 
Visa Inc., Class A  800,000   70,304 
FLIR Systems, Inc.  2,327,200   60,205 
MediaTek Inc.  5,298,000   53,237 
KLA-Tencor Corp.  1,083,000   39,724 
Applied Materials, Inc.  3,337,000   37,775 
Maxim Integrated Products, Inc.  1,375,000   31,694 
Linear Technology Corp.  1,050,000   30,062 
Xilinx, Inc.  496,900   15,473 
Digital River, Inc.1
  440,442   8,862 
       4,283,021 
         
HEALTH CARE — 17.50%        
Biogen Idec Inc.1
  5,756,000   542,215 
Medco Health Solutions, Inc.1
  6,607,991   357,757 
Gilead Sciences, Inc.1
  8,450,000   337,028 
St. Jude Medical, Inc.  6,780,000   308,761 
McKesson Corp.  3,475,000   277,757 
Amgen Inc.  4,405,000   244,059 
Hologic, Inc.1,2
  13,774,100   229,201 
Endo Pharmaceuticals Holdings Inc.1,2
  6,200,000   197,842 
Medtronic, Inc.  4,690,000   164,478 
Abbott Laboratories  2,450,000   128,649 
Life Technologies Corp.1
  2,903,600   121,951 
BioMarin Pharmaceutical Inc.1
  4,115,000   121,742 
Edwards Lifesciences Corp.1
  1,575,000   118,834 
Stryker Corp.  2,211,000   107,985 
Forest Laboratories, Inc.1
  3,000,000   102,720 
Zimmer Holdings, Inc.1
  1,719,000   97,794 
Alere Inc.1
  2,812,000   70,216 
Allergan, Inc.  844,600   69,097 
VCA Antech, Inc.1
  1,882,984   34,854 
Roche Holding AG  165,000   28,891 
Merck & Co., Inc.  778,545   25,785 
Illumina, Inc.1
  416,000   21,674 
Boston Scientific Corp.1
  2,547,890   17,275 
ZOLL Medical Corp.1
  245,000   10,946 
NuVasive, Inc.1
  225,000   5,452 
       3,742,963 
         
CONSUMER DISCRETIONARY — 15.05%        
DIRECTV, Class A1
  12,240,000   538,193 
Kohl’s Corp.  6,815,000   315,807 
Johnson Controls, Inc.  8,550,000   272,574 
YUM! Brands, Inc.  4,726,000   256,953 
News Corp., Class A  11,850,000   204,649 
Garmin Ltd.  5,399,000   181,028 
Tractor Supply Co.  2,650,000   162,630 
Comcast Corp., Class A  6,875,000   147,881 
Time Warner Inc.  4,433,333   140,359 
Time Warner Cable Inc.  2,095,613   137,263 
Staples, Inc.  8,860,000   130,596 
Harley-Davidson, Inc.  3,100,000   119,846 
Bed Bath & Beyond Inc.1
  2,000,000   113,720 
NIKE, Inc., Class B  1,250,000   108,313 
Best Buy Co., Inc.  3,000,000   76,770 
DreamWorks Animation SKG, Inc., Class A1
  3,300,000   69,696 
Urban Outfitters, Inc.1
  2,500,000   65,438 
Texas Roadhouse, Inc.  4,557,200   65,168 
Lowe’s Companies, Inc.  2,000,000   39,860 
P.F. Chang’s China Bistro, Inc.  800,000   24,112 
Amazon.com, Inc.1
  100,000   21,529 
Harman International Industries, Inc.  537,686   19,459 
Timberland Co., Class A1
  125,280   5,380 
       3,217,224 
         
INDUSTRIALS — 9.91%        
Precision Castparts Corp.  2,860,000   468,611 
Union Pacific Corp.  3,370,600   310,668 
United Technologies Corp.  2,850,000   211,612 
United Parcel Service, Inc., Class B  2,820,000   190,040 
CSX Corp.  7,884,500   172,986 
General Dynamics Corp.  2,355,000   150,908 
Robert Half International Inc.  4,663,600   111,553 
Verisk Analytics, Inc., Class A1
  2,890,000   100,688 
Serco Group PLC  10,103,000   84,133 
MITIE Group PLC2  
  22,902,000   82,570 
Southwest Airlines Co.  7,885,000   67,969 
Landstar System, Inc.  1,350,000   54,661 
Rockwell Collins, Inc.  703,907   35,519 
MSC Industrial Direct Co., Inc., Class A  560,000   34,535 
Iron Mountain Inc.  470,000   15,294 
Corrections Corporation of America1
  658,030   14,931 
Mine Safety Appliances Co.  438,400   13,547 
       2,120,225 
         
FINANCIALS — 8.39%        
JPMorgan Chase & Co.  9,500,000   356,820 
Wells Fargo & Co.  10,079,600   263,078 
Capital One Financial Corp.  4,245,700   195,514 
American Express Co.  3,500,000   173,985 
PNC Financial Services Group, Inc.  2,295,000   115,071 
State Street Corp.  3,169,200   112,570 
Bank of New York Mellon Corp.  5,200,000   107,484 
Arthur J. Gallagher & Co.  3,525,000   99,440 
Hudson City Bancorp, Inc.  12,700,000   78,867 
BB&T Corp.  3,500,000   78,015 
Cullen/Frost Bankers, Inc.  1,250,000   63,738 
Zions Bancorporation  3,487,000   60,813 
AFLAC Inc.  1,600,000   60,352 
City National Corp.  523,600   23,504 
East West Bancorp, Inc.  350,000   5,842 
       1,795,093 
         
ENERGY — 6.85%        
Schlumberger Ltd.  4,366,940   341,145 
EOG Resources, Inc.  3,548,000   328,509 
FMC Technologies, Inc.1
  4,450,000   197,847 
Apache Corp.  1,300,000   133,991 
Devon Energy Corp.  1,850,000   125,486 
Chevron Corp.  1,100,000   108,801 
ConocoPhillips  1,035,000   70,453 
Southwestern Energy Co.1
  1,825,000   69,259 
Murphy Oil Corp.  700,000   37,506 
BG Group PLC  1,180,000   25,514 
Exxon Mobil Corp.  260,000   19,250 
Baker Hughes Inc.  115,000   7,028 
       1,464,789 
         
CONSUMER STAPLES — 4.62%        
CVS/Caremark Corp.  7,350,000   263,938 
PepsiCo, Inc.  2,917,981   188,006 
Philip Morris International Inc.  2,500,000   173,300 
L’Oréal SA  850,000   92,541 
Whole Foods Market, Inc.  1,132,000   74,746 
Avon Products, Inc.  2,980,000   67,229 
Ralcorp Holdings, Inc.1
  588,700   50,964 
Altria Group, Inc.  1,750,000   47,582 
Colgate-Palmolive Co.  340,000   30,590 
       988,896 
         
MATERIALS — 2.41%        
AptarGroup, Inc.  2,100,000   106,008 
Monsanto Co.  1,400,000   96,502 
Praxair, Inc.  901,531   88,792 
Scotts Miracle-Gro Co., Class A  1,800,000   87,408 
Barrick Gold Corp.  1,417,104   71,918 
Air Products and Chemicals, Inc.  700,000   57,309 
AK Steel Holding Corp.  784,400   7,052 
       514,989 
         
TELECOMMUNICATION SERVICES — 2.05%        
MetroPCS Communications, Inc.1
  13,114,500   146,358 
tw telecom inc.1
  6,500,000   125,385 
Crown Castle International Corp.1
  2,480,200   107,715 
United States Cellular Corp.1
  734,300   31,751 
Telephone and Data Systems, Inc., special common shares  1,066,300   27,031 
       438,240 
         
MISCELLANEOUS — 2.10%        
Other common stocks in initial period of acquisition      448,432 
         
         
Total common stocks (cost: $15,164,070,000)      19,013,872 
         
         
         
Convertible securities — 0.00%        
         
CONSUMER DISCRETIONARY — 0.00%        
Johnson Controls, Inc. 11.50% convertible preferred 2012, units3
  4,600   713 
         
         
Total convertible securities (cost: $230,000)      713 
         
         
  Principal amount     
Short-term securities — 10.98%  (000)    
         
Freddie Mac 0.11%–0.281% due 10/4/2011–6/7/2012 $537,877   537,746 
Fannie Mae 0.03%–0.231% due 9/26/2011–7/16/2012  450,700   450,593 
Federal Home Loan Bank 0.105%–0.25% due 10/12/2011–8/1/2012  345,683   345,474 
Federal Farm Credit Banks 0.12%–0.281% due 9/9/2011–2/23/2012  206,784   206,743 
U.S. Treasury Bills 0.155%–0.222% due 9/1/2011–5/3/2012  185,545   185,517 
Coca-Cola Co. 0.14%–0.22% due 9/2/2011–1/4/20124
  137,150   137,117 
Variable Funding Capital Company LLC 0.13%–0.20% due 9/6–10/25/20114
  130,450   130,421 
Honeywell International Inc. 0.16% due 11/29–11/30/20114
  83,600   83,569 
Falcon Asset Securitization Co., LLC 0.14%–0.20% due 9/21–10/11/20114
  64,700   64,692 
General Electric Capital Corp. 0.17% due 10/18/2011  30,000   29,994 
General Electric Capital Services, Inc. 0.16% due 10/17/2011  16,600   16,597 
General Electric Co. 0.04% due 9/1/2011  13,700   13,700 
Private Export Funding Corp. 0.20% due 9/20/20114
  45,000   44,997 
Texas Instruments Inc. 0.12%–0.15% due 10/17–11/14/20114
  45,000   44,980 
Hewlett-Packard Co. 0.11%–0.17% due 9/13–11/28/20114
  22,400   22,391 
Straight-A Funding LLC 0.15% due 10/7/20114
  21,000   20,992 
Google Inc. 0.05% due 9/30/20114
  12,300   12,299 
         
Total short-term securities (cost: $2,347,086,000)      2,347,822 
         
         
Total investment securities (cost: $17,511,386,000)      21,362,407 
Other assets less liabilities      22,307 
         
Net assets     $21,384,714 

As permitted by U.S. Securities and Exchange Commission regulations, “Miscellaneous” securities include holdings in their first year of acquisition that have not previously been publicly disclosed.


1Security did not produce income during the last 12 months.
2Represents an affiliated company as defined under the Investment Company Act of 1940.
3Valued under fair value procedures adopted by authority of the board of trustees. The total value of all such securities was $713,000, which represented less than .01% of the net assets of the fund.
4Acquired in a transaction exempt from registration under the Securities Act of 1933. May be resold in the U.S. in transactions exempt from registration, normally to qualified institutional buyers. The total value of all such securities was $561,458,000, which represented 2.63% of the net assets of the fund.




Investments are not FDIC-insured, nor are they deposits of or guaranteed by a bank or any other entity, so they may lose value.
 
Investors should carefully consider the investment objectives, risks, charges and expenses of the American Funds. This and other important information is contained in the fund’s prospectus and summary prospectus, which can be obtained from your financial professional and should be read carefully before investing. You may also call American Funds Service Company (AFS) at 800/421-0180 or visit the American Funds website at americanfunds.com.


 
 
MFGEFP-902-1011O-S29395
 
 
ITEM 7 – Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies

Not applicable to this Registrant, insofar as the Registrant is not a closed-end management investment company.


ITEM 8 – Portfolio Managers of Closed-End Management Investment Companies

Not applicable to this Registrant, insofar as the Registrant is not a closed-end management investment company.


ITEM 9 – Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers

Not applicable to this Registrant, insofar as the Registrant is not a closed-end management investment company.


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 Registrant’s board of trustees since the Registrant last submitted a proxy statement to its shareholders.  The procedures are as follows.  The Registrant has a nominating and governance committee comprised solely of persons who are not considered ‘‘interested persons’’ of the Registrant within the meaning of the Investment Company Act of 1940, as amended. The committee periodically reviews such issues as the board’s composition, responsibilities, committees, compensation and other relevant issues, and recommends any appropriate changes to the full board of trustees. While the committee normally is able to identify from its own resources an ample number of qualified candidates, it will consider shareholder suggestions of persons to be considered as nominees to fill future vacancies on the board. Such suggestions must be sent in writing to the nominating and governance committee of the Registrant, c/o the Registrant’s Secretary, and must be accompanied by complete biographical and occupational data on the prospective nominee, along with a written consent of the prospective nominee for consideration of his or her name by the nominating and governance committee.


ITEM 11 – Controls and Procedures

(a)The Registrant’s Principal Executive Officer and Principal Financial Officer have concluded, based on their evaluation of the Registrant’s disclosure controls and procedures (as such term is defined in Rule 30a-3 under the Investment Company Act of 1940), that such controls and procedures are adequate and reasonably designed to achieve the purposes described in paragraph (c) of such rule.
  
(b)There were no changes in the Registrant’s internal controls over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) that occurred during the Registrant’s second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting.


ITEM 12 – Exhibits

(a)(1)Not applicable for filing of semi-annual reports to shareholders.
  
(a)(2)The certifications required by Rule 30a-2 of the Investment Company Act of 1940 and Sections 302 and 906 of the Sarbanes-Oxley Act of 2002 are attached as exhibits hereto.
 
 
 

 

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 AMCAP FUND
  
 
By /s/ Claudia P. Huntington
 
Claudia P. Huntington, Vice Chairman and
Principal Executive Officer
  
 Date: October 31, 2011



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/ Claudia P. Huntington
Claudia P. Huntington, Vice Chairman and
Principal Executive Officer
 
Date: October 31, 2011



By /s/ Karl C. Grauman
Karl C. Grauman, Treasurer and
Principal Financial Officer
 
Date: October 31, 2011