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

811-21227

 

Eaton Vance Insured Pennsylvania Municipal Bond Fund

(Exact name of registrant as specified in charter)

 

The Eaton Vance Building, 255 State Street, Boston, Massachusetts

 

02109

(Address of principal executive offices)

 

(Zip code)

 

Maureen A. Gemma
The Eaton Vance Building, 255 State Street, Boston, Massachusetts 02109

(Name and address of agent for service)

 

Registrant’s telephone number, including area code:

(617) 482-8260

 

 

Date of fiscal year end:

September 30

 

 

Date of reporting period:

September 30, 2007

 

 




Item 1. Reports to Stockholders




Annual Report September 30, 2007

EATON VANCE
INSURED
MUNICIPAL
BOND
FUNDS

CLOSED-END FUNDS:

Insured Municipal II

Insured California II

Insured Florida

Insured Massachusetts

Insured Michigan

Insured New Jersey

Insured New York II

Insured Ohio

Insured Pennsylvania



IMPORTANT NOTICES REGARDING PRIVACY,
DELIVERY OF SHAREHOLDER DOCUMENTS,
PORTFOLIO HOLDINGS, AND PROXY VOTING

Privacy. The Eaton Vance organization is committed to ensuring your financial privacy. Each of the financial institutions identified below has in effect the following policy ("Privacy Policy") with respect to nonpublic personal information about its customers:

•  Only such information received from you, through application forms or otherwise, and information about your Eaton Vance fund transactions will be collected. This may include information such as name, address, social security number, tax status, account balances and transactions.

•  None of such information about you (or former customers) will be disclosed to anyone, except as permitted by law (which includes disclosure to employees necessary to service your account). In the normal course of servicing a customer's account, Eaton Vance may share information with unaffiliated third parties that perform various required services such as transfer agents, custodians and broker/dealers.

•  Policies and procedures (including physical, electronic and procedural safeguards) are in place that are designed to protect the confidentiality of such information.

•  We reserve the right to change our Privacy Policy at any time upon proper notification to you. Customers may want to review our Policy periodically for changes by accessing the link on our homepage: www.eatonvance.com.

Our pledge of privacy applies to the following entities within the Eaton Vance organization: the Eaton Vance Family of Funds, Eaton Vance Management, Eaton Vance Investment Counsel, Boston Management and Research, and Eaton Vance Distributors, Inc.

In addition, our Privacy Policy only applies to those Eaton Vance customers who are individuals and who have a direct relationship with us. If a customer's account (i.e., fund shares) is held in the name of a third-party financial adviser/ broker-dealer, it is likely that only such adviser's privacy policies apply to the customer. This notice supersedes all previously issued privacy disclosures.

For more information about Eaton Vance's Privacy Policy, please call 1-800-262-1122.

Delivery of Shareholder Documents. The Securities and Exchange Commission (the "SEC") permits funds to deliver only one copy of shareholder documents, including prospectuses, proxy statements and shareholder reports, to fund investors with multiple accounts at the same residential or post office box address. This practice is often called "householding" and it helps eliminate duplicate mailings to shareholders.

Eaton Vance, or your financial adviser, may household the mailing of your documents indefinitely unless you instruct Eaton Vance, or your financial adviser, otherwise.

If you would prefer that your Eaton Vance documents not be householded, please contact Eaton Vance at 1-800-262-1122, or contact your financial adviser.

Your instructions that householding not apply to delivery of your Eaton Vance documents will be effective within 30 days of receipt by Eaton Vance or your financial adviser.

Portfolio Holdings. Each Eaton Vance Fund and its underlying Portfolio if applicable will file a schedule of its portfolio holdings on Form N-Q with the SEC for the first and third quarters of each fiscal year. The Form N-Q will be available on the Eaton Vance website www.eatonvance.com, by calling Eaton Vance at 1-800-262-1122 or in the EDGAR database on the SEC's website at www.sec.gov. Form N-Q may also be reviewed and copied at the SEC's public reference room in Washington, D.C. (call 1-800-732-0330 for information on the operation of the public reference room).

Proxy Voting. From time to time, funds are required to vote proxies related to the securities held by the funds. The Eaton Vance Funds or their underlying Portfolios (if applicable) vote proxies according to a set of policies and procedures approved by the Funds' and Portfolios' Boards. You may obtain a description of these policies and procedures and information on how the Funds or Portfolios voted proxies relating to portfolio securities during the most recent 12 month period ended June 30, without charge, upon request, by calling 1-800-262-1122. This description is also available on the SEC's website at www.sec.gov.




Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

TABLE OF CONTENTS

Management’s Discussion of Fund Performance

2

 

 

Performance Information and Portfolio Composition

 

 

 

Eaton Vance Insured Municipal Bond Fund II

3

Eaton Vance Insured California Municipal Bond Fund II

4

Eaton Vance Insured Florida Municipal Bond Fund

5

Eaton Vance Insured Massachusetts Municipal Bond Fund

6

Eaton Vance Insured Michigan Municipal Bond Fund

7

Eaton Vance Insured New Jersey Municipal Bond Fund

8

Eaton Vance Insured New York Municipal Bond Fund II

9

Eaton Vance Insured Ohio Municipal Bond Fund

10

Eaton Vance Insured Pennsylvania Municipal Bond Fund

11

 

 

Financial Statements

12

 

 

Federal Tax Information

77

 

 

Dividend Reinvestment Plan

78

 

 

Board of Trustees’ Annual Approval of the Investment Advisory Agreements

80

 

 

Management and Organization

83

 

 

Notice to Shareholders

85

 

1




Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE

Eaton Vance Insured Municipal Bond Funds (the “Funds”) are closed-end funds designed to provide current income exempt from regular federal income tax, federal alternative minimum tax and, in state specific funds, state personal income taxes, as applicable. The Funds invest primarily in high-grade municipal securities that are insured as to the timely payment of principal and interest.

Economic and Market Conditions

Third quarter economic growth rose 3.9%, following the 3.8% growth rate achieved in the second quarter of 2007, according to preliminary Commerce Department data. During the third quarter ended September 30, the housing sector continued to struggle, as market concerns related to subprime mortgages caused a number of mortgage lenders to file for bankruptcy protection and others to limit new mortgage originations. Building permits and housing starts have both fallen significantly from their highs in early 2006, while sales of new and existing homes are down from their 2005 peaks. However, the weaker dollar is having a stimulative effect on economic growth in export-related industries and on U.S.-based multinational companies whose foreign profits are translated into more dollars. Overall, we believe the economy appears to be slowing, but in a somewhat controlled manner.

According to the Federal Reserve’s (the “Fed”) preferred inflation indicator, the Personal Consumption Expenditure (PCE) price deflator, both absolute and core (excludes food and energy) inflation is fairly well contained within the upper end of the Fed’s comfort zone. In an unscheduled August 17, 2007 meeting, the Fed lowered its Discount Rate – the rate charged to banks borrowing directly from the Fed – to 5.75% from 6.25%. The move was aimed at providing liquidity during a period of increased uncertainty and tighter credit conditions that surfaced rapidly in mid-August. On September 18, 2007, the Fed lowered its Federal Funds Rate to 4.75% from 5.25% – its first rate cut since the Fed stopped raising rates in June 2006 – and lowered the Discount Rate again to 5.25% from 5.75%.

Municipal market supply rose to record levels in the first half of 2007, resulting in underperformance of the municipal sector. On September 30, 2007, long-term AAA-rated insured municipal bonds yielded 93.9% of U.S. Treasury bonds with similar maturities.*

For the year ended September 30, 2007, the Lehman Brothers Municipal Bond Index† (the “Index”), an unmanaged index of municipal bonds, posted a gain of 3.10%. For more information about each Fund’s performance and that of funds in the same Lipper Classification,† see the Performance Information and Portfolio Composition pages that follow.

Management Discussion

The Funds invest primarily in bonds with maturities of 10 years or longer, as longer-maturity bonds historically have provided greater tax-exempt income for investors than shorter-maturity bonds. While Eaton Vance Insured New Jersey Municipal Bond Fund and Eaton Vance Insured Pennsylvania Municipal Bond Fund slightly outperformed their benchmark Index by net asset value (but not by share price) during the year ended September 30, 2007, the remaining Funds underperformed. Much of the underperformance can be attributed to the broader-based credit scare that took hold of the fixed-income markets in late August. Yields on some municipal bonds reached 105% of U.S. Treasury yields. We believe that the ratio was not the result of any fundamental problems within the municipal market, but rather reflected the extreme dislocation in the fixed-income marketplace caused by the subprime fears, hedge fund problems, the decentralized municipal marketplace and illiquidity across a range of markets. The Funds’ exposure to more liquid, higher-credit quality bonds actually hurt performance, as hedge funds and other non-traditional municipal market participants sold large positions of their most liquid bonds in order to raise cash.

Historically, there have been only a few instances of municipals trading at the cheap levels seen in August 2007, and it has generally been a short-term phenomenon. During September, municipals outperformed Treasury Bonds, as municipal yields started moving back toward their more historic relationship to Treasuries. Overall, liquidity has returned to the fixed-income marketplace with a more rational view of the market and risk assessment.


*

Source: Bloomberg L.P. Yields are a compilation of a representative variety of general obligations and are not necessarily representative of a Fund’s yield.

It is not possible to invest directly in an Index or Lipper Classification. The Index’s total return does not reflect expenses that would have been incurred if an investor individually purchased or sold the securities represented in the Index.

 

 

 

Past performance is no guarantee of future results.

 

Fund shares are not insured by the FDIC and are not deposits or other obligations of, or guaranteed by, any depository institution. Shares are subject to investment risks, including possible loss of principal invested.

The views expressed throughout this report are those of the portfolio managers and are current only through the end of the period of the report as stated on the cover. These views are subject to change at any time based upon market or other conditions, and the investment adviser disclaims any responsibility to update such views. These views may not be relied on as investment advice and, because investment decisions for a fund are based on many factors, may not be relied on as an indication of trading intent on behalf of any Eaton Vance fund.

2




Eaton Vance Insured Municipal Bond Fund II as of September 30, 2007

PERFORMANCE INFORMATION AND PORTFOLIO COMPOSITION

Fund Performance as of 9/30/07(1)

American Stock Exchange Symbol

 

EIV

 

 

 

 

 

Average Annual Total Return (by share price)

 

 

 

One Year

 

-0.20

%

Life of Fund (11/29/02)

 

6.72

 

 

 

 

 

Average Annual Total Return (by net asset value)

 

 

 

One Year

 

2.43

%

Life of Fund (11/29/02)

 

8.08

 

 

Market Yields

Market Yield(2)

 

5.09

%

Taxable-Equivalent Market Yield(3)

 

7.83

 

 

Index Performance(4)

Lehman Brothers Municipal Bond Index - Average Annual Total Returns

 

 

 

One Year

 

3.10

%

Life of Fund (11/30/02)

 

4.61

 

 

Lipper Averages(5)

Lipper Insured Municipal Debt Funds (Leveraged) Classification - Average Annual Total Returns

 

 

 

One Year

 

1.79

%

Life of Fund (11/30/02)

 

5.52

 

 

Portfolio Manager: William H. Ahern, CFA

Rating Distribution*(6),(7)

By total investments


*      The rating distribution presented above includes the ratings of securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1H to the Fund’s financial statements. Absent such securities, the Fund’s rating distribution at September 30, 2007, is as follows and the average rating is AAA:

AAA

 

88.0

%

AA

 

4.2

%

A

 

3.1

%

BBB

 

4.7

%

 

Fund Statistics(7),(8)

·   Number of Issues:

 

74

·   Average Maturity:

 

27.0 years

·   Average Effective Maturity:

 

13.8 years

·   Average Call Protection:

 

9.6 years

·   Average Dollar Price:

 

$91.28

·   Leverage:**

 

36.3%

 


**The leverage amount is Auction Preferred Shares at liquidation value as a percentage of the Fund’s net assets applicable to common shares plus Auction Preferred Shares. The Fund uses leverage through the issuance of preferred shares. Use of financial leverage creates an opportunity for increased income but, at the same time, creates special risks (including the likelihood of greater volatility of net asset value and market price of common shares).

Past performance is no guarantee of future results. Returns are historical and are calculated by determining the percentage change in net asset value or share price (as applicable) with all distributions reinvested. Investment return and principal value will fluctuate so that shares, when sold, may be worth more or less than their original cost. Performance is for the stated time period only; due to market volatility, the Fund’s current performance may be lower or higher than the quoted return. For performance as of the most recent month-end, please refer to www.eatonvance.com.


(1) Returns are historical and are calculated by determining the percentage change in share price or net asset value with all distributions reinvested. The Fund’s performance at market share price will differ from its results at NAV. Although share price performance generally reflects investment results over time, during shorter periods, returns at share price can also be affected by factors such as changing perceptions about the Fund, market conditions, fluctuations in supply and demand for the Fund’s shares, or changes in Fund distributions. Performance results reflect the effect of leverage resulting from the Fund’s issuance of Auction Preferred Shares.

(2) The Fund’s market yield is calculated by dividing the last dividend paid per common share of the fiscal year by the share price at the end of the fiscal year and annualizing the result.

(3) Taxable-equivalent figure assumes a maximum 35.00% federal income tax rate. A lower tax rate would result in a lower tax-equivalent figure.

(4) It is not possible to invest directly in an Index. The Index’s total return does not reflect the expenses that would have been incurred if an investor individually purchased or sold the securities represented in the Index. Index performance is available as of month-end only.

(5) The Lipper Averages are the average annual total returns at net asset value of the funds that are in the same Lipper Classification as the Fund. It is not possible to invest in a Lipper Classification. Lipper Classifications may include insured and uninsured funds, as well as leveraged and unleveraged funds. The Lipper Insured Municipal Debt Funds (Leveraged) Classification (closed-end) contained 23 funds for the 1-year and Life-of-Fund periods. Lipper Averages are available as of month-end only.

(6) Rating Distribution is determined by dividing the total market value of the issues by the total investments of the Fund.

(7) As of 9/30/07. Portfolio information may not be representative of the Fund’s current or future investments and may change due to active management.

(8) Portfolio holdings information excludes securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1H to the Fund’s financial statements.

3




Eaton Vance Insured California Municipal Bond Fund II as of September 30, 2007

PERFORMANCE INFORMATION AND PORTFOLIO COMPOSITION

Fund Performance as of 9/30/07(1)

American Stock Exchange Symbol

 

EIA

 

 

 

 

 

Average Annual Total Return (by share price)

 

 

 

One Year

 

2.11

%

Life of Fund (11/29/02)

 

5.86

 

 

 

 

 

Average Annual Total Return (by net asset value)

 

 

 

One Year

 

2.75

%

Life of Fund (11/29/02)

 

7.02

 

 

Market Yields

Market Yield(2)

 

4.85

%

Taxable-Equivalent Market Yield(3)

 

8.23

 

 

Index Performance(4)

Lehman Brothers Municipal Bond Index - Average Annual Total Returns

 

 

 

One Year

 

3.10

%

Life of Fund (11/30/02)

 

4.61

 

 

Lipper Averages(5)

Lipper California Insured Municipal Debt Funds Classification - Average Annual Total Returns

 

 

 

One Year

 

2.25

%

Life of Fund (11/30/02)

 

5.63

 

 

Portfolio Manager: Cynthia J. Clemson

Rating Distribution*(6),(7)

By total investments


*      The rating distribution presented above includes the ratings of securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1H to the Fund’s financial statements. Absent such securities, the Fund’s rating distribution at September 30, 2007, is as follows and the average rating is AAA:

AAA

 

84.8

%

AA

 

2.8

%

A

 

12.4

%

 

Fund Statistics(7),(8)

·   Number of Issues:

 

56

·   Average Maturity:

 

26.0 years

·   Average Effective Maturity:

 

12.1 years

·   Average Call Protection:

 

8.6 years

·   Average Dollar Price:

 

$88.56

·   Leverage:**

 

36.8%

 


**      The leverage amount is Auction Preferred Shares at liquidation value as a percentage of the Fund’s net assets applicable to common shares plus Auction Preferred Shares. The Fund uses leverage through the issuance of preferred shares. Use of financial leverage creates an opportunity for increased income but, at the same time, creates special risks (including the likelihood of greater volatility of net asset value and market price of common shares).

Past performance is no guarantee of future results. Returns are historical and are calculated by determining the percentage change in net asset value or share price (as applicable) with all distributions reinvested. Investment return and principal value will fluctuate so that shares, when sold, may be worth more or less than their original cost. Performance is for the stated time period only; due to market volatility, the Fund’s current performance may be lower or higher than the quoted return. For performance as of the most recent month-end, please refer to www.eatonvance.com.


(1) Returns are historical and are calculated by determining the percentage change in share price or net asset value with all distributions reinvested. The Fund’s performance at market share price will differ from its results at NAV. Although share price performance generally reflects investment results over time, during shorter periods, returns at share price can also be affected by factors such as changing perceptions about the Fund, market conditions, fluctuations in supply and demand for the Fund’s shares, or changes in Fund distributions. Performance results reflect the effect of leverage resulting from the Fund’s issuance of Auction Preferred Shares.

(2) The Fund’s market yield is calculated by dividing the last dividend paid per common share of the fiscal year by the share price at the end of the fiscal year and annualizing the result.

(3) Taxable-equivalent figure assumes a maximum 41.05% combined federal and state income tax rate. A lower tax rate would result in a lower tax-equivalent figure.

(4) It is not possible to invest directly in an Index. The Index’s total return does not reflect the expenses that would have been incurred if an investor individually purchased or sold the securities represented in the Index. Index performance is available as of month-end only.

(5) The Lipper Averages are the average annual total returns at net asset value of the funds that are in the same Lipper Classification as the Fund. It is not possible to invest in a Lipper Classification. Lipper Classifications may include insured and uninsured funds, as well as leveraged and unleveraged funds. The Lipper California Insured Municipal Debt Funds Classification (closed-end) contained 13 funds for the 1-year and Life-of-Fund periods. Lipper Averages are available as of month-end only.

(6) Rating Distribution is determined by dividing the total market value of the issues by the total investments of the Fund.

(7) As of 9/30/07. Portfolio information may not be representative of the Fund’s current or future investments and may change due to active management.

(8) Portfolio holdings information excludes securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1H to the Fund’s financial statements.

4




Eaton Vance Insured Florida Municipal Bond Fund as of September 30, 2007

PERFORMANCE INFORMATION AND PORTFOLIO COMPOSITION

Fund Performance as of 9/30/07(1)

American Stock Exchange Symbol

 

EIF

 

 

 

 

 

Average Annual Total Return (by share price)

 

 

 

One Year

 

-1.48

%

Life of Fund (11/29/02)

 

4.68

 

 

 

 

 

Average Annual Total Return (by net asset value)

 

 

 

One Year

 

2.00

%

Life of Fund (11/29/02)

 

6.59

 

 

Market Yields

Market Yield(2)

 

4.69

%

Taxable-Equivalent Market Yield(3)

 

7.22

 

 

Index Performance(4)

Lehman Brothers Municipal Bond Index - Average Annual Total Returns

 

 

 

One Year

 

3.10

%

Life of Fund (11/30/02)

 

4.61

 

 

Lipper Averages(5)

Lipper Florida Municipal Debt Funds Classification - Average Annual Total Returns

 

 

 

One Year

 

1.59

%

Life of Fund (11/30/02)

 

5.49

 

 

Portfolio Manager: Craig R. Brandon, CFA

Rating Distribution*(6),(7)

By total investments


*      The rating distribution presented above includes the ratings of securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1H to the Fund’s financial statements. Absent such securities, the Fund’s rating distribution at September 30, 2007, is as follows and the average rating is AAA:

AAA

 

86.9

%

AA

 

5.2

%

A

 

7.1

%

Non-Rated

 

0.8

%

 

Fund Statistics(7),(8)

·   Number of Issues:

 

53

·   Average Maturity:

 

25.1 years

·   Average Effective Maturity:

 

13.6 years

·   Average Call Protection:

 

9.7 years

·   Average Dollar Price:

 

$92.67

·   Leverage:**

 

37.2%

 


**      The leverage amount is Auction Preferred Shares at liquidation value as a percentage of the Fund’s net assets applicable to common shares plus Auction Preferred Shares. The Fund uses leverage through the issuance of preferred shares. Use of financial leverage creates an opportunity for increased income but, at the same time, creates special risks (including the likelihood of greater volatility of net asset value and market price of common shares).

Past performance is no guarantee of future results. Returns are historical and are calculated by determining the percentage change in net asset value or share price (as applicable) with all distributions reinvested. Investment return and principal value will fluctuate so that shares, when sold, may be worth more or less than their original cost. Performance is for the stated time period only; due to market volatility, the Fund’s current performance may be lower or higher than the quoted return. For performance as of the most recent month-end, please refer to www.eatonvance.com.


(1) Returns are historical and are calculated by determining the percentage change in share price or net asset value with all distributions reinvested. The Fund’s performance at market share price will differ from its results at NAV. Although share price performance generally reflects investment results over time, during shorter periods, returns at share price can also be affected by factors such as changing perceptions about the Fund, market conditions, fluctuations in supply and demand for the Fund’s shares, or changes in Fund distributions. Performance results reflect the effect of leverage resulting from the Fund’s issuance of Auction Preferred Shares.

(2) The Fund’s market yield is calculated by dividing the last dividend paid per common share of the fiscal year by the share price at the end of the fiscal year and annualizing the result.

(3) Taxable-equivalent figure assumes a maximum 35.00% federal income tax rate. A lower tax rate would result in a lower tax-equivalent figure.

(4) It is not possible to invest directly in an Index. The Index’s total return does not reflect the expenses that would have been incurred if an investor individually purchased or sold the securities represented in the Index. Index performance is available as of month-end only.

(5) The Lipper Averages are the average annual total returns at net asset value of the funds that are in the same Lipper Classification as the Fund. It is not possible to invest in a Lipper Classification. Lipper Classifications may include insured and uninsured funds, as well as leveraged and unleveraged funds. The Lipper Florida Municipal Debt Funds Classification (closed-end) contained 16 and 15 funds for the 1-year and Life-of-Fund periods, respectively. Lipper Averages are available as of month-end only.

(6) Rating Distribution is determined by dividing the total market value of the issues by the total investments of the Fund.

(7) As of 9/30/07. Portfolio information may not be representative of the Fund’s current or future investments and may change due to active management.

(8) Portfolio holdings information excludes securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1H to the Fund’s financial statements.

5




Eaton Vance Insured Massachusetts Municipal Bond Fund as of September 30, 2007

PERFORMANCE INFORMATION AND PORTFOLIO COMPOSITION

Fund Performance as of 9/30/07(1)

American Stock Exchange Symbol

 

MAB

 

 

 

 

 

Average Annual Total Return (by share price)

 

 

 

One Year

 

-3.72

%

Life of Fund (11/29/02)

 

6.73

 

 

 

 

 

Average Annual Total Return (by net asset value)

 

 

 

One Year

 

0.88

%

Life of Fund (11/29/02)

 

7.14

 

 

Market Yields

Market Yield(2)

 

4.51

%

Taxable-Equivalent Market Yield(3)

 

7.33

 

 

Index Performance(4)

Lehman Brothers Municipal Bond Index - Average Annual Total Returns

 

 

 

One Year

 

3.10

%

Life of Fund (11/30/02)

 

4.61

 

 

Lipper Averages(5)

Lipper Other States Municipal Debt Funds Classification - Average Annual Total Returns

 

 

 

One Year

 

1.60

%

Life of Fund (11/30/02)

 

5.95

 

 

Portfolio Manager: Robert B. MacIntosh, CFA

Rating Distribution*(6),(7)

By total investments


*      The rating distribution presented above includes the ratings of securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1H to the Fund’s financial statements. Absent such securities, the Fund’s rating distribution at September 30, 2007, is as follows and the average rating is AAA:

AAA

 

83.7

%

AA

 

7.4

%

A

 

5.6

%

BBB

 

1.7

%

Non-Rated

 

1.6

%

 

Fund Statistics(7),(8)

·   Number of Issues:

 

44

·   Average Maturity:

 

27.1 years

·   Average Effective Maturity:

 

13.5 years

·   Average Call Protection:

 

10.7 years

·   Average Dollar Price:

 

$99.14

·   Leverage:**

 

36.9%

 


**      The leverage amount is Auction Preferred Shares at liquidation value as a percentage of the Fund’s net assets applicable to common shares plus Auction Preferred Shares. The Fund uses leverage through the issuance of preferred shares. Use of financial leverage creates an opportunity for increased income but, at the same time, creates special risks (including the likelihood of greater volatility of net asset value and market price of common shares).

Past performance is no guarantee of future results. Returns are historical and are calculated by determining the percentage change in net asset value or share price (as applicable) with all distributions reinvested. Investment return and principal value will fluctuate so that shares, when sold, may be worth more or less than their original cost. Performance is for the stated time period only; due to market volatility, the Fund’s current performance may be lower or higher than the quoted return. For performance as of the most recent month-end, please refer to www.eatonvance.com.


(1) Returns are historical and are calculated by determining the percentage change in share price or net asset value with all distributions reinvested. The Fund’s performance at market share price will differ from its results at NAV. Although share price performance generally reflects investment results over time, during shorter periods, returns at share price can also be affected by factors such as changing perceptions about the Fund, market conditions, fluctuations in supply and demand for the Fund’s shares, or changes in Fund distributions. Performance results reflect the effect of leverage resulting from the Fund’s issuance of Auction Preferred Shares.

(2) The Fund’s market yield is calculated by dividing the last dividend paid per common share of the fiscal year by the share price at the end of the fiscal year and annualizing the result.

(3) Taxable-equivalent figure assumes a maximum 38.45% combined federal and state income tax rate. A lower tax rate would result in a lower tax-equivalent figure.

(4) It is not possible to invest directly in an Index. The Index’s total return does not reflect the expenses that would have been incurred if an investor individually purchased or sold the securities represented in the Index. Index performance is available as of month-end only.

(5) The Lipper Averages are the average annual total returns at net asset value of the funds that are in the same Lipper Classification as the Fund. It is not possible to invest in a Lipper Classification. Lipper Classifications may include insured and uninsured funds, as well as leveraged and unleveraged funds. The Lipper Other States Municipal Debt Funds Classification (closed-end) contained 46 funds for the 1-year and Life-of-Fund periods. Lipper Averages are available as of month-end only.

(6) Rating Distribution is determined by dividing the total market value of the issues by the total investments of the Fund.

(7) As of 9/30/07. Portfolio information may not be representative of the Fund’s current or future investments and may change due to active management.

(8) Portfolio holdings information excludes securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1H to the Fund’s financial statements.

6




Eaton Vance Insured Michigan Municipal Bond Fund as of September 30, 2007

PERFORMANCE INFORMATION AND PORTFOLIO COMPOSITION

Fund Performance as of 9/30/07(1)

American Stock Exchange Symbol

 

MIW

 

 

 

 

 

Average Annual Total Return (by share price)

 

 

 

One Year

 

3.53

%

Life of Fund (11/29/02)

 

5.29

 

 

 

 

 

Average Annual Total Return (by net asset value)

 

 

 

One Year

 

2.81

%

Life of Fund (11/29/02)

 

6.98

 

 

Market Yields

Market Yield(2)

 

4.76

%

Taxable-Equivalent Market Yield(3)

 

7.62

 

 

Index Performance(4)

Lehman Brothers Municipal Bond Index - Average Annual Total Returns

 

 

 

One Year

 

3.10

%

Life of Fund (11/30/02)

 

4.61

 

 

Lipper Averages(5)

Lipper Michigan Municipal Debt Funds Classification - Average Annual Total Returns

 

 

 

One Year

 

1.75

%

Life of Fund (11/30/02)

 

5.81

 

 

Portfolio Manager: William H. Ahern, CFA

Rating Distribution*(6),(7)

By total investments


*      The rating distribution presented above includes the ratings of securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1H to the Fund’s financial statements. Absent such securities, the Fund’s rating distribution at September 30, 2007, is as follows and the average rating is AAA:

AAA

 

82.3

%

AA

 

4.3

%

A

 

12.3

%

BBB

 

1.1

%

 

Fund Statistics(7),(8)

·   Number of Issues:

 

37

·   Average Maturity:

 

23.4 years

·   Average Effective Maturity:

 

8.9 years

·   Average Call Protection:

 

7.4 years

·   Average Dollar Price:

 

$94.15

·   Leverage:**

 

37.1%

 


**      The leverage amount is Auction Preferred Shares at liquidation value as a percentage of the Fund’s net assets applicable to common shares plus Auction Preferred Shares. The Fund uses leverage through the issuance of preferred shares. Use of financial leverage creates an opportunity for increased income but, at the same time, creates special risks (including the likelihood of greater volatility of net asset value and market price of common shares).

Past performance is no guarantee of future results. Returns are historical and are calculated by determining the percentage change in net asset value or share price (as applicable) with all distributions reinvested. Investment return and principal value will fluctuate so that shares, when sold, may be worth more or less than their original cost. Performance is for the stated time period only; due to market volatility, the Fund’s current performance may be lower or higher than the quoted return. For performance as of the most recent month-end, please refer to www.eatonvance.com.


(1) Returns are historical and are calculated by determining the percentage change in share price or net asset value with all distributions reinvested. The Fund’s performance at market share price will differ from its results at NAV. Although share price performance generally reflects investment results over time, during shorter periods, returns at share price can also be affected by factors such as changing perceptions about the Fund, market conditions, fluctuations in supply and demand for the Fund’s shares, or changes in Fund distributions. Performance results reflect the effect of leverage resulting from the Fund’s issuance of Auction Preferred Shares.

(2) The Fund’s market yield is calculated by dividing the last dividend paid per common share of the fiscal year by the share price at the end of the fiscal year and annualizing the result.

(3) Taxable-equivalent figure assumes a maximum 37.54% combined federal and state income tax rate. A lower tax rate would result in a lower tax-equivalent figure.

(4) It is not possible to invest directly in an Index. The Index’s total return does not reflect the expenses that would have been incurred if an investor individually purchased or sold the securities represented in the Index. Index performance is available as of month-end only.

(5) The Lipper Averages are the average annual total returns at net asset value of the funds that are in the same Lipper Classification as the Fund. It is not possible to invest in a Lipper Classification. Lipper Classifications may include insured and uninsured funds, as well as leveraged and unleveraged funds. The Lipper Michigan Municipal Debt Funds Classification (closed-end) contained 7 funds for the 1-year and Life-of-Fund periods. Lipper Averages are available as of month-end only.

(6) Rating Distribution is determined by dividing the total market value of the issues by the total investments of the Fund.

(7) As of 9/30/07. Portfolio information may not be representative of the Fund’s current or future investments and may change due to active management.

(8) Portfolio holdings information excludes securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1H to the Fund’s financial statements.

7




Eaton Vance Insured New Jersey Municipal Bond Fund as of September 30, 2007

PERFORMANCE INFORMATION AND PORTFOLIO COMPOSITION

Fund Performance as of 9/30/07(1)

American Stock Exchange Symbol

 

EMJ

 

 

 

 

 

Average Annual Total Return (by share price)

 

 

 

One Year

 

-5.66

%

Life of Fund (11/29/02)

 

6.77

 

 

 

 

 

Average Annual Total Return (by net asset value)

 

 

 

One Year

 

3.64

%

Life of Fund (11/29/02)

 

8.09

 

 

Market Yields

Market Yield(2)

 

4.73

%

Taxable-Equivalent Market Yield(3)

 

7.99

 

 

Index Performance(4)

Lehman Brothers Municipal Bond Index - Average Annual Total Returns

 

 

 

One Year

 

3.10

%

Life of Fund (11/30/02)

 

4.61

 

 

Lipper Averages(5)

Lipper New Jersey Municipal Debt Funds Classification - Average Annual Total Returns

 

 

 

One Year

 

1.63

%

Life of Fund (11/30/02)

 

6.52

 

 

Portfolio Manager: Robert B. MacIntosh, CFA

Rating Distribution*(6),(7)

By total investments


*      The rating distribution presented above includes the ratings of securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1H to the Fund’s financial statements. Absent such securities, the Fund’s rating distribution at September 30, 2007, is as follows and the average rating is AA+:

AAA

 

83.5

%

AA

 

2.1

%

A

 

6.6

%

BBB

 

7.8

%

 

Fund Statistics(7),(8)

·   Number of Issues:

 

66

·   Average Maturity:

 

24.5 years

·   Average Effective Maturity:

 

11.7 years

·   Average Call Protection:

 

9.2 years

·   Average Dollar Price:

 

$90.66

·   Leverage:**

 

35.9%

 


**      The leverage amount is Auction Preferred Shares at liquidation value as a percentage of the Fund’s net assets applicable to common shares plus Auction Preferred Shares. The Fund uses leverage through the issuance of preferred shares. Use of financial leverage creates an opportunity for increased income but, at the same time, creates special risks (including the likelihood of greater volatility of net asset value and market price of common shares).

Past performance is no guarantee of future results. Returns are historical and are calculated by determining the percentage change in net asset value or share price (as applicable) with all distributions reinvested. Investment return and principal value will fluctuate so that shares, when sold, may be worth more or less than their original cost. Performance is for the stated time period only; due to market volatility, the Fund’s current performance may be lower or higher than the quoted return. For performance as of the most recent month-end, please refer to www.eatonvance.com.


(1) Returns are historical and are calculated by determining the percentage change in share price or net asset value with all distributions reinvested. The Fund’s performance at market share price will differ from its results at NAV. Although share price performance generally reflects investment results over time, during shorter periods, returns at share price can also be affected by factors such as changing perceptions about the Fund, market conditions, fluctuations in supply and demand for the Fund’s shares, or changes in Fund distributions. Performance results reflect the effect of leverage resulting from the Fund’s issuance of Auction Preferred Shares.

(2) The Fund’s market yield is calculated by dividing the last dividend paid per common share of the fiscal year by the share price at the end of the fiscal year and annualizing the result.

(3) Taxable-equivalent figure assumes a maximum 40.83% combined federal and state income tax rate. A lower tax rate would result in a lower tax-equivalent figure.

(4) It is not possible to invest directly in an Index. The Index’s total return does not reflect the expenses that would have been incurred if an investor individually purchased or sold the securities represented in the Index. Index performance is available as of month-end only.

(5) The Lipper Averages are the average annual total returns at net asset value of the funds that are in the same Lipper Classification as the Fund. It is not possible to invest in a Lipper Classification. Lipper Classifications may include insured and uninsured funds, as well as leveraged and unleveraged funds. The Lipper New Jersey Municipal Debt Funds Classification (closed-end) contained 13 funds for the 1-year and Life-of-Fund periods. Lipper Averages are available as of month-end only.

(6) Rating Distribution is determined by dividing the total market value of the issues by the total investments of the Fund.

(7) As of 9/30/07. Portfolio information may not be representative of the Fund’s current or future investments and may change due to active management.

(8) Portfolio holdings information excludes securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1H to the Fund’s financial statements.

8




Eaton Vance Insured New York Municipal Bond Fund II as of September 30, 2007

PERFORMANCE INFORMATION AND PORTFOLIO COMPOSITION

Fund Performance as of 9/30/07(1)

American Stock Exchange Symbol

 

NYH

 

 

 

 

 

Average Annual Total Return (by share price)

 

 

 

One Year

 

6.66

%

Life of Fund (11/29/02)

 

6.81

 

 

 

 

 

Average Annual Total Return (by net asset value)

 

 

 

One Year

 

3.00

%

Life of Fund (11/29/02)

 

8.01

 

 

Market Yields

Market Yield(2)

 

4.83

%

Taxable-Equivalent Market Yield(3)

 

7.98

 

 

Index Performance(4)

Lehman Brothers Municipal Bond Index - Average Annual Total Returns

 

 

 

One Year

 

3.10

%

Life of Fund (11/30/02)

 

4.61

 

 

Lipper Averages(5)

Lipper New York Insured Municipal Debt Funds Classification - Average Annual Total Returns

 

 

 

One Year

 

2.20

%

Life of Fund (11/30/02)

 

5.71

 

 

Portfolio Manager: Craig R. Brandon, CFA

Rating Distribution*(6),(7)

By total investments


*      The rating distribution presented above includes the ratings of securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1H to the Fund’s financial statements. Absent such securities, the Fund’s rating distribution at September 30, 2007, is as follows and the average rating is AAA:

AAA

 

86.9

%

AA

 

8.6

%

A

 

3.3

%

BBB

 

1.2

%

 

Fund Statistics(7),(8)

·   Number of Issues:

 

49

·   Average Maturity:

 

28.1 years

·   Average Effective Maturity:

 

14.9 years

·   Average Call Protection:

 

11.1 years

·   Average Dollar Price:

 

$92.13

·   Leverage:**

 

36.6%

 


**      The leverage amount is Auction Preferred Shares at liquidation value as a percentage of the Fund’s net assets applicable to common shares plus Auction Preferred Shares. The Fund uses leverage through the issuance of preferred shares. Use of financial leverage creates an opportunity for increased income but, at the same time, creates special risks (including the likelihood of greater volatility of net asset value and market price of common shares).

Past performance is no guarantee of future results. Returns are historical and are calculated by determining the percentage change in net asset value or share price (as applicable) with all distributions reinvested. Investment return and principal value will fluctuate so that shares, when sold, may be worth more or less than their original cost. Performance is for the stated time period only; due to market volatility, the Fund’s current performance may be lower or higher than the quoted return. For performance as of the most recent month-end, please refer to www.eatonvance.com.


(1) Returns are historical and are calculated by determining the percentage change in share price or net asset value with all distributions reinvested. The Fund’s performance at market share price will differ from its results at NAV. Although share price performance generally reflects investment results over time, during shorter periods, returns at share price can also be affected by factors such as changing perceptions about the Fund, market conditions, fluctuations in supply and demand for the Fund’s shares, or changes in Fund distributions. Performance results reflect the effect of leverage resulting from the Fund’s issuance of Auction Preferred Shares.

(2) The Fund’s market yield is calculated by dividing the last dividend paid per common share of the fiscal year by the share price at the end of the fiscal year and annualizing the result.

(3) Taxable-equivalent figure assumes a maximum 39.45% combined federal and state income tax rate. A lower tax rate would result in a lower tax-equivalent figure.

(4) It is not possible to invest directly in an Index. The Index’s total return does not reflect the expenses that would have been incurred if an investor individually purchased or sold the securities represented in the Index. Index performance is available as of month-end only.

(5) The Lipper Averages are the average annual total returns at net asset value of the funds that are in the same Lipper Classification as the Fund. It is not possible to invest in a Lipper Classification. Lipper Classifications may include insured and uninsured funds, as well as leveraged and unleveraged funds. The Lipper New York Insured Municipal Debt Funds Classification (closed-end) contained 12 funds for the 1-year and Life-of-Fund periods. Lipper Averages are available as of month-end only.

(6) Rating Distribution is determined by dividing the total market value of the issues by the total investments of the Fund.

(7) As of 9/30/07. Portfolio information may not be representative of the Fund’s current or future investments and may change due to active management.

(8) Portfolio holdings information excludes securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1H to the Fund’s financial statements.

9




Eaton Vance Insured Ohio Municipal Bond Fund as of September 30, 2007

PERFORMANCE INFORMATION AND PORTFOLIO COMPOSITION

Fund Performance as of 9/30/07(1)

American Stock Exchange Symbol

 

EIO

 

 

 

 

 

Average Annual Total Return (by share price)

 

 

 

One

 

-1.75

%

Life of Fund (11/29/02)

 

4.64

 

 

 

 

 

Average Annual Total Return (by net asset value)

 

 

 

One Year

 

2.17

%

Life of Fund (11/29/02)

 

6.56

 

 

Market Yields

Market Yield(2)

 

4.54

%

Taxable-Equivalent Market Yield(3)

 

7.12

 

 

Index Performance(4)

Lehman Brothers Municipal Bond Index - Average Annual Total Returns

 

 

 

One Year

 

3.10

%

Life of Fund (11/30/02)

 

4.61

 

 

Lipper Averages(5)

Lipper Other States Municipal Debt Funds Classification - Average Annual Total Returns

 

 

 

One Year

 

1.60

%

Life of Fund (11/30/02)

 

5.95

 

 

Portfolio Manager: William H. Ahern, CFA

Rating Distribution*(6),(7)

By total investments


*      The rating distribution presented above includes the ratings of securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1H to the Fund’s financial statements. Absent such securities, the Fund’s rating distribution at September 30, 2007, is as follows and the average rating is AAA:

AAA

 

87.4

%

AA

 

3.7

%

A

 

5.4

%

BBB

 

2.5

%

Non-Rated

 

1.0

%

 

Fund Statistics(7),(8)

·   Number of Issues:

 

54

·   Average Maturity:

 

23.8 years

·   Average Effective Maturity:

 

12.1 years

·   Average Call Protection:

 

9.5 years

·   Average Dollar Price:

 

$90.12

·   Leverage:**

 

36.8%

 


**      The leverage amount is Auction Preferred Shares at liquidation value as a percentage of the Fund’s net assets applicable to common shares plus Auction Preferred Shares. The Fund uses leverage through the issuance of preferred shares. Use of financial leverage creates an opportunity for increased income but, at the same time, creates special risks (including the likelihood of greater volatility of net asset value and market price of common shares).

Past performance is no guarantee of future results. Returns are historical and are calculated by determining the percentage change in net asset value or share price (as applicable) with all distributions reinvested. Investment return and principal value will fluctuate so that shares, when sold, may be worth more or less than their original cost. Performance is for the stated time period only; due to market volatility, the Fund’s current performance may be lower or higher than the quoted return. For performance as of the most recent month-end, please refer to www.eatonvance.com.


(1) Returns are historical and are calculated by determining the percentage change in share price or net asset value with all distributions reinvested. The Fund’s performance at market share price will differ from its results at NAV. Although share price performance generally reflects investment results over time, during shorter periods, returns at share price can also be affected by factors such as changing perceptions about the Fund, market conditions, fluctuations in supply and demand for the Fund’s shares, or changes in Fund distributions. Performance results reflect the effect of leverage resulting from the Fund’s issuance of Auction Preferred Shares.

(2) The Fund’s market yield is calculated by dividing the last dividend paid per common share of the fiscal year by the share price at the end of the fiscal year and annualizing the result.

(3) Taxable-equivalent figure assumes a maximum 36.26% combined federal and state income tax rate. A lower tax rate would result in a lower tax-equivalent figure.

(4) It is not possible to invest directly in an Index. The Index’s total return does not reflect the expenses that would have been incurred if an investor individually purchased or sold the securities represented in the Index. Index performance is available as of month-end only.

(5) The Lipper Averages are the average annual total returns at net asset value of the funds that are in the same Lipper Classification as the Fund. It is not possible to invest in a Lipper Classification. Lipper Classifications may include insured and uninsured funds, as well as leveraged and unleveraged funds. The Lipper Other States Municipal Debt Funds Classification (closed-end) contained 46 funds for the 1-year and Life-of-Fund periods. Lipper Averages are available as of month-end only.

(6) Rating Distribution is determined by dividing the total market value of the issues by the total investments of the Fund.

(7) As of 9/30/07. Portfolio information may not be representative of the Fund’s current or future investments and may change due to active management.

(8) Portfolio holdings information excludes securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1H to the Fund’s financial statements.

10




Eaton Vance Insured Pennsylvania Municipal Bond Fund as of September 30, 2007

PERFORMANCE INFORMATION AND PORTFOLIO COMPOSITION

Fund Performance as of 9/30/07(1)

American Stock Exchange Symbol

 

EIP

 

 

 

 

 

Average Annual Total Return (by share price)

 

 

 

One Year

 

-1.28

%

Life of Fund (11/29/02)

 

5.65

 

 

 

 

 

Average Annual Total Return (by net asset value)

 

 

 

One Year

 

3.44

%

Life of Fund (11/29/02)

 

7.32

 

 

Market Yields

Market Yield(2)

 

4.88

%

Taxable-Equivalent Market Yield(3)

 

7.75

 

 

Index Performance(4)

Lehman Brothers Municipal Bond Index - Average Annual Total Returns

 

 

 

One Year

 

3.10

%

Life of Fund (11/30/02)

 

4.61

 

 

Lipper Averages(5)

Lipper Pennsylvania Municipal Debt Funds Classification - Average Annual Total Returns

 

 

 

One Year

 

1.63

%

Life of Fund (11/30/02)

 

5.99

 

 

Portfolio Manager: Thomas M. Metzold, CFA

Effective October 1, 2007, Adam Weigold, CFA, will replace Mr. Metzold as the Fund’s portfolio manager. Mr. Weigold is a Vice President of Eaton Vance Management and Boston Management and Research and manages other Eaton Vance municipal funds. He has been employed by the Eaton Vance organization since 1998.

Rating Distribution*(6),(7)

By total investments


*      The rating distribution presented above includes the ratings of securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1H to the Fund’s financial statements. Absent such securities, the Fund’s rating distribution at September 30, 2007, is as follows and the average rating is AAA:

AAA

 

84.9

%

AA

 

9.2

%

A

 

4.2

%

BBB

 

1.2

%

Non-Rated

 

0.5

%

 

Fund Statistics(7),(8)

·   Number of Issues:

 

58

·   Average Maturity:

 

24.5 years

·   Average Effective Maturity:

 

11.1 years

·   Average Call Protection:

 

8.6 years

·   Average Dollar Price:

 

$94.48

·   Leverage:**

 

36.6%

 


**      The leverage amount is Auction Preferred Shares at liquidation value as a percentage of the Fund’s net assets applicable to common shares plus Auction Preferred Shares. The Fund uses leverage through the issuance of preferred shares. Use of financial leverage creates an opportunity for increased income but, at the same time, creates special risks (including the likelihood of greater volatility of net asset value and market price of common shares).

Past performance is no guarantee of future results. Returns are historical and are calculated by determining the percentage change in net asset value or share price (as applicable) with all distributions reinvested. Investment return and principal value will fluctuate so that shares, when sold, may be worth more or less than their original cost. Performance is for the stated time period only; due to market volatility, the Fund’s current performance may be lower or higher than the quoted return. For performance as of the most recent month-end, please refer to www.eatonvance.com.


(1) Returns are historical and are calculated by determining the percentage change in share price or net asset value with all distributions reinvested. The Fund’s performance at market share price will differ from its results at NAV. Although share price performance generally reflects investment results over time, during shorter periods, returns at share price can also be affected by factors such as changing perceptions about the Fund, market conditions, fluctuations in supply and demand for the Fund’s shares, or changes in Fund distributions. Performance results reflect the effect of leverage resulting from the Fund’s issuance of Auction Preferred Shares.

(2) The Fund’s market yield is calculated by dividing the last dividend paid per common share of the fiscal year by the share price at the end of the fiscal year and annualizing the result.

(3) Taxable-equivalent figure assumes a maximum 37.00% combined federal and state income tax rate. A lower tax rate would result in a lower tax-equivalent figure.

(4) It is not possible to invest directly in an Index. The Index’s total return does not reflect the expenses that would have been incurred if an investor individually purchased or sold the securities represented in the Index. Index performance is available as of month-end only.

(5) The Lipper Averages are the average annual total returns at net asset value of the funds that are in the same Lipper Classification as the Fund. It is not possible to invest in a Lipper Classification. Lipper Classifications may include insured and uninsured funds, as well as leveraged and unleveraged funds. The Lipper Pennsylvania Municipal Debt Funds Classification (closed-end) contained 9 funds for the 1-year and Life-of-Fund periods. Lipper Averages are available as of month-end only.

(6) Rating Distribution is determined by dividing the total market value of the issues by the total investments of the Fund.

(7) As of 9/30/07. Portfolio information may not be representative of the Fund’s current or future investments and may change due to active management.

(8) Portfolio holdings information excludes securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1H to the Fund’s financial statements.

11




Eaton Vance Insured Municipal Bond Fund II as of September 30, 2007

PORTFOLIO OF INVESTMENTS

Tax-Exempt Investments — 181.3%      
Principal Amount
(000's omitted)
 
Security
  Value  
Electric Utilities — 1.0%      
$ 1,600     Sabine River Authority,TX, (TXU Energy Co. LLC),
5.20%, 5/1/28
  $ 1,489,744    
    $ 1,489,744    
Escrowed / Prerefunded — 1.0%      
$ 1,250     Capital Trust Agency, FL, (Seminole Tribe Convention),
Prerefunded to 10/1/12, 8.95%, 10/1/33(1)
  $ 1,532,712    
    $ 1,532,712    
General Obligations — 4.0%      
$ 2,215     California, 5.50%, 11/1/33   $ 2,346,903    
  3,610     New York City, NY, 5.25%, 1/15/33     3,750,754    
    $ 6,097,657    
Hospital — 5.1%      
$ 1,275     Brevard County, FL, Health Facilities Authority,
(Health First, Inc.), 5.00%, 4/1/36
  $ 1,269,237    
  400     Camden County, NJ, Improvement Authority,
(Cooper Health System), 5.00%, 2/15/25
    394,724    
  900     Camden County, NJ, Improvement Authority,
(Cooper Health System), 5.00%, 2/15/35
    858,042    
  750     Camden County, NJ, Improvement Authority,
(Cooper Health System), 5.25%, 2/15/27
    753,825    
  380     Cuyahoga County, OH, (Cleveland Clinic Health System),
5.50%, 1/1/29
    397,393    
  500     Hawaii Department of Budget and Finance,
(Hawaii Pacific Health), 5.60%, 7/1/33
    508,630    
  1,315     Highlands County, FL, Health Facilities Authority,
(Adventist Health System), 5.25%, 11/15/36
    1,345,074    
  2,255     Knox County, TN, Health, Educational & Housing
Facilities Board, (Covenant Health), 0.00%, 1/1/38
    431,562    
  5,000     Knox County, TN, Health, Educational & Housing
Facilities Board, (Covenant Health), 0.00%, 1/1/39
    903,250    
  1,000     Lehigh County, PA, General Purpose Authority,
(Lehigh Valley Health Network), 5.25%, 7/1/32
    1,019,380    
    $ 7,881,117    
Industrial Development Revenue — 6.7%      
$ 5,000     Liberty, NY, Development Corp., (Goldman Sachs
Group, Inc.), 5.25%, 10/1/35
  $ 5,340,550    
  5,000     St. John Baptist Parish, LA, (Marathon Oil Corp.),
5.125%, 6/1/37
    4,995,100    
    $ 10,335,650    

 

Principal Amount
(000's omitted)
 
Security
  Value  
Insured-Electric Utilities — 26.6%      
$ 1,000     Burlington, KS, Pollution Control Revenue,
(Kansas Gas & Electric Co.), (MBIA), 5.30%, 6/1/31
  $ 1,049,790    
  22,685     Chelan County, WA, Public Utility District No. 1,
(Columbia River), (MBIA), 0.00%, 6/1/23
    10,985,438    
  3,900     JEA, FL, Electric System Revenue, (FSA), 5.00%, 10/1/34     3,978,312    
  5,000     Kentucky Municipal Power Agency, (Prairie Street
Project), Series A, (MBIA), 5.00%, 9/1/37
    5,167,800    
  11,505     Long Island Power Authority, NY, Electric Systems
Revenue, (FGIC), 5.00%, 12/1/23(2)
    12,129,185    
  2,990     Mississippi Development Bank, (Municipal Energy),
(XLCA), 5.00%, 3/1/41
    3,036,106    
  3,070     Missouri Joint Municipal Electric Utility Commission,
Series A, (AMBAC), 4.50%, 1/1/37
    2,975,076    
  1,500     Municipal Energy Agency, NE, (Power Supply System),
(FSA), 5.00%, 4/1/36
    1,533,075    
    $ 40,854,782    
Insured-Escrowed / Prerefunded — 2.7%      
$ 3,825     Pittsburgh, PA, Water and Sewer Authority, (AMBAC),
Prerefunded to 6/1/12, 5.125%, 12/1/27(2)
  $ 4,074,607    
    $ 4,074,607    
Insured-General Obligations — 26.2%      
$ 2,550     Butler County, KS, Unified School District No. 394,
(FSA), 3.50%, 9/1/24
  $ 2,248,717    
  4,135     California, (AMBAC), 4.25%, 12/1/35     3,792,622    
  4,915     California, (XLCA), 5.00%, 10/1/28(2)     5,075,195    
  12,165     Chabot-Las Positas, CA, Community College District,
(AMBAC), 0.00%, 8/1/43
    1,911,973    
  1,515     Chicago, IL, (MBIA), 5.00%, 1/1/42     1,541,149    
  17,000     Coast Community College District, CA,
(Election of 2002), (FSA), 0.00%, 8/1/33
    4,362,710    
  1,000     District of Columbia, (FGIC), Variable Rate,
6.23%, 6/1/33(1)(3)
    1,011,600    
  2,450     Frisco, TX, Independent School District, (MBIA),
4.50%, 8/15/40
    2,329,337    
  1,500     Goodyear, AZ, (MBIA), 3.00%, 7/1/26     1,189,980    
  4,830     King County, WA, (MBIA), 5.25%, 1/1/34     4,893,901    
  6,250     Philadelphia, PA, (FSA), 5.00%, 9/15/31(2)     6,351,941    
  5,490     Port Orange, FL, Capital Improvements, (FGIC),
5.00%, 10/1/35
    5,611,329    
    $ 40,320,454    

 

See notes to financial statements
12



Eaton Vance Insured Municipal Bond Fund II as of September 30, 2007

PORTFOLIO OF INVESTMENTS CONT'D

Principal Amount
(000's omitted)
 
Security
  Value  
Insured-Hospital — 7.4%      
$ 9,000     Maryland Health and Higher Educational Facilities
Authority, (Medlantic/Helix Issue), (FSA),
5.25%, 8/15/38(2)
  $ 9,872,160    
  1,400     New York Dormitory Authority, (Health Quest Systems),
(AGC), Series B, 5.125%, 7/1/37
    1,442,168    
    $ 11,314,328    
Insured-Industrial Development Revenue — 0.4%      
$ 625     Monroe County, GA, Development Authority,
(Georgia Power Co.), (AMBAC), 4.90%, 7/1/36
  $ 629,194    
    $ 629,194    
Insured-Lease Revenue / Certificates of
Participation — 2.9%
     
$ 4,250     Massachusetts Development Finance Agency,
(MBIA), 5.125%, 2/1/34
  $ 4,413,030    
    $ 4,413,030    
Insured-Private Education — 3.6%      
$ 2,500     Massachusetts Development Finance Agency,
(Boston University), (XLCA), 6.00%, 5/15/59
  $ 3,017,050    
  2,500     Massachusetts Development Finance Agency,
(Franklin W. Olin College), (XLCA), 5.25%, 7/1/33
    2,590,150    
    $ 5,607,200    
Insured-Public Education — 2.4%      
$ 3,500     College of Charleston, SC, Academic and
Administrative Facilities, (XLCA), 5.125%, 4/1/30
  $ 3,627,610    
    $ 3,627,610    
Insured-Special Assessment Revenue — 4.4%      
$ 6,500     San Jose, CA, Redevelopment Agency Tax, (MBIA),
5.00%, 8/1/32(2)
  $ 6,833,432    
    $ 6,833,432    
Insured-Special Tax Revenue — 9.2%      
$ 4,000     Metropolitan Pier and Exposition Authority, IL, (McCormick
Place Expansion), (MBIA), 5.25%, 6/15/42
  $ 4,155,520    
  2,500     New York Convention Center Development Corp.,
Hotel Occupancy Tax, (AMBAC), 4.75%, 11/15/45
    2,489,375    
  35,675     Puerto Rico Sales Tax Financing, (AMBAC), 0.00%, 8/1/54     3,513,274    
  6,085     Puerto Rico Sales Tax Financing, (MBIA), 0.00%, 8/1/44     1,004,390    
  12,065     Puerto Rico Sales Tax Financing, (MBIA), 0.00%, 8/1/45     1,894,326    
  7,595     Puerto Rico Sales Tax Financing, (MBIA), 0.00%, 8/1/46     1,132,946    
    $ 14,189,831    

 

Principal Amount
(000's omitted)
 
Security
  Value  
Insured-Transportation — 31.4%      
$ 1,000     Central, TX, Regional Mobility Authority, (FGIC),
5.00%, 1/1/45
  $ 1,019,740    
  11,900     E-470 Public Highway Authority, CO, (MBIA),
0.00%, 9/1/22
    6,053,768    
  2,990     Metropolitan Transportation Authority, NY, (FGIC),
4.75%, 11/15/37
    3,007,761    
  10,000     Minneapolis-St Paul, MN, Metropolitan Airports
Commission, (FGIC), 4.50%, 1/1/32
    9,708,900    
  13,885     Nevada Department of Business and Industry,
(Las Vegas Monorail -1st Tier), (AMBAC),
0.00%, 1/1/20
    7,989,290    
  10,000     Texas Turnpike Authority, (AMBAC), 5.00%, 8/15/42(4)     10,148,600    
  10,000     Triborough Bridge and Tunnel Authority, NY, (MBIA),
5.00%, 11/15/32
    10,283,900    
    $ 48,211,959    
Insured-Utilities — 4.0%      
$ 6,000     Philadelphia, PA, Gas Works Revenue, (FSA),
5.00%, 8/1/32
  $ 6,129,060    
    $ 6,129,060    
Insured-Water and Sewer — 12.1%      
$ 2,240     Atlanta, GA, Water and Wastewater, (FGIC),
5.00%, 11/1/38(5)
  $ 2,258,570    
  4,895     Atlanta, GA, Water and Wastewater, (MBIA),
5.00%, 11/1/39
    4,969,941    
  1,950     New York City, NY, Municipal Water Finance Authority,
(Water and Sewer System), (AMBAC), 5.00%, 6/15/38
    1,996,137    
  11,390     Pearland, TX, Waterworks and Sewer Systems, (MBIA),
3.50%, 9/1/31
    9,306,427    
    $ 18,531,075    
Insured-Water Revenue — 28.4%      
$ 7,000     Contra Costa, CA, Water District, (FSA),
5.00%, 10/1/32(2)
  $ 7,218,997    
  10,350     Detroit, MI, Water Supply System, (MBIA),
5.00%, 7/1/34(2)
    10,575,009    
  6,500     Los Angeles, CA, Department of Water and Power,
Water Revenue, (FGIC), 5.00%, 7/1/43
    6,610,630    
  1,100     Marysville, OH, Wastewater Treatment System, (XLCA),
4.75%, 12/1/46
    1,081,663    
  6,110     Massachusetts Water Resources Authority, (AMBAC),
4.00%, 8/1/40
    5,348,633    
  7,000     Metropolitan Water District, CA, (FGIC), 5.00%, 10/1/36     7,195,440    
  2,870     San Antonio, TX, Water Revenue, (FGIC),
5.00%, 5/15/23
    2,982,160    
  2,575     Tacoma, WA, Sewer Revenue, (FGIC), 5.00%, 12/1/31     2,622,869    
    $ 43,635,401    

 

See notes to financial statements
13



Eaton Vance Insured Municipal Bond Fund II as of September 30, 2007

PORTFOLIO OF INVESTMENTS CONT'D

Principal Amount
(000's omitted)
 
Security
  Value  
Other Revenue — 0.3%  
$ 500     Main Street National Gas Inc., GA, Series A,
5.50%, 9/15/27(6)
  $ 527,755    
    $ 527,755    
Special Tax Revenue — 1.5%  
$ 750     New Jersey Economic Development Authority,
(Cigarette Tax), 5.50%, 6/15/24
  $ 768,518    
  1,480     New Jersey Economic Development Authority,
(Cigarette Tax), 5.75%, 6/15/29
    1,549,826    
    $ 2,318,344    
Total Tax-Exempt Investments — 181.3%  
(identified cost $269,747,238)
    $ 278,554,942    
Other Assets, Less Liabilities — (24.4)%   $ (37,424,815 )  
Auction Preferred Shares Plus Cumulative  
Unpaid Dividends — (56.9)%
    $ (87,517,980 )  
Net Assets Applicable to   
Common Shares — 100.0%
    $ 153,612,147    

 

AGC - Assured Guaranty Corp.

AMBAC - AMBAC Financial Group, Inc.

FGIC - Financial Guaranty Insurance Company

FSA - Financial Security Assurance, Inc.

MBIA - Municipal Bond Insurance Association

XLCA - XL Capital Assurance, Inc.

At September 30, 2007, the concentration of the Fund's investments in the various states, determined as a percentage of total investments, is as follows:

California  16.3%

New York  14.5%

Others, representing less than 10% individually  69.2%

The Fund invests primarily in debt securities issued by municipalities. The ability of the issuers of the debt securities to meet their obligations may be affected by economic developments in a specific industry or municipality. In order to reduce the risk associated with such economic developments, at September 30, 2007, 89.2% of total investments are backed by bond insurance of various financial institutions and financial guaranty assurance agencies. The aggregate percentage insured by an individual financial institution ranged from 0.5% to 31.5% of total investments.

(1)  Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be sold in transactions exempt from registration, normally to qualified institutional buyers. At September 30, 2007, the aggregate value of the securities is $2,544,312 or 1.7% of the Fund's net assets applicable to common shares.

(2)  Security represents the underlying municipal obligation of an inverse floating rate obligation held by the Fund.

(3)  Security has been issued as a leveraged inverse floater bond. The stated interest rate represents the rate in effect at September 30, 2007.

(4)  Security (or a portion thereof) has been segregated to cover payable for when-issued securities.

(5)  Security (or a portion thereof) has been segregated to cover margin requirements on open financial futures contracts.

(6)  When-issued security.

See notes to financial statements
14



Eaton Vance Insured California Municipal Bond Fund II as of September 30, 2007

PORTFOLIO OF INVESTMENTS

Tax-Exempt Investments — 168.5%      
Principal Amount
(000's omitted)
 
Security
  Value  
General Obligations — 2.7%      
$ 1,465     California, 5.50%, 11/1/33   $ 1,552,241    
          $ 1,552,241    
Hospital — 16.7%      
$ 1,445     California Health Facilities Financing Authority,
(Cedars-Sinai Medical Center), 5.00%, 11/15/34
  $ 1,448,266    
  2,940     California Statewide Communities Development Authority,
(Huntington Memorial Hospital), 5.00%, 7/1/35
    2,957,611    
  1,000     California Statewide Communities Development Authority,
(John Muir Health), 5.00%, 8/15/36
    1,001,010    
  405     California Statewide Communities Development Authority,
(John Muir Health), Series A, 5.00%, 8/15/34
    405,984    
  1,400     California Statewide Communities Development Authority,
(Kaiser Permanente), 5.00%, 3/1/41
    1,387,582    
  1,900     California Statewide Communities Development Authority,
(Kaiser Permanente), 5.25%, 3/1/45
    1,923,788    
  555     Washington Township Health Care District, 5.00%, 7/1/32     552,613    
          $ 9,676,854    
Insured-Electric Utilities — 5.0%      
$ 1,475     Glendale Electric, (MBIA), 5.00%, 2/1/32   $ 1,511,196    
  1,370     Sacramento, Municipal Electric Utility District, (FSA),
5.00%, 8/15/28(1)
    1,404,652    
          $ 2,915,848    
Insured-Escrowed / Prerefunded — 8.2%      
$ 740     San Francisco Bay Area Rapid Transportation District
Sales Tax Revenue, (AMBAC), Prerefunded to 7/1/11,
5.00%, 7/1/31
  $ 780,471    
  1,765     San Francisco Bay Area Rapid Transportation District
Sales Tax Revenue, (AMBAC), Prerefunded to 7/1/11,
5.125%, 7/1/36
    1,869,241    
  2,000     University of California, (FGIC), Prerefunded to 9/1/10,
5.125%, 9/1/31
    2,111,920    
          $ 4,761,632    
Insured-General Obligations — 54.5%      
$ 740     Antelope Valley Community College District,
(Election of 2004), Series B, (MBIA), 5.25%, 8/1/39
  $ 787,086    
  8,680     Arcadia Unified School District, (FSA), 0.00%, 8/1/38     1,764,470    
  3,115     Arcadia Unified School District, (FSA), 0.00%, 8/1/40     570,512    
  3,270     Arcadia Unified School District, (FSA), 0.00%, 8/1/41     569,111    
  1,615     California, (AMBAC), 4.25%, 12/1/35     1,481,278    

 

Principal Amount
(000's omitted)
 
Security
 
Value
 
Insured-General Obligations (continued)      
$ 820     California, (AMBAC), 5.00%, 4/1/27   $ 849,750    
  1,250     California, (XLCA), 5.00%, 10/1/28(1)     1,290,537    
  1,500     Carlsbad Unified School District, (Election 2006),
Series A, (MBIA), 5.25%, 8/1/32
    1,604,955    
  19,350     Chabot-Las Positas Community College District,
(AMBAC), 0.00%, 8/1/43
    3,041,239    
  5,000     Clovis Unified School District, (FGIC), 0.00%, 8/1/20     2,859,900    
  6,675     Coast Community College District, (FSA), 0.00%, 8/1/35     1,528,108    
  2,350     Long Beach Unified School District, (Election of 1999),
(FSA), 5.00%, 8/1/31
    2,417,868    
  1,945     Los Osos Community Services, Wastewater Assessment
District, (MBIA), 5.00%, 9/2/33
    1,991,777    
  1,000     Mount Diablo Unified School District, (FSA),
5.00%, 8/1/25
    1,039,240    
  2,205     San Diego Unified School District, (MBIA),
5.50%, 7/1/24(1)
    2,511,451    
  4,300     San Mateo County Community College District,
(Election of 2001), (FGIC), 0.00%, 9/1/21
    2,326,558    
  1,750     Santa Ana Unified School District, (MBIA),
5.00%, 8/1/32
    1,793,172    
  1,620     Santa Clara Unified School District, (Election of 2004),
(FSA), 4.375%, 7/1/30
    1,567,690    
  3,200     Union Elementary School District, (FGIC),
0.00%, 9/1/22
    1,647,040    
          $ 31,641,742    
Insured-Lease Revenue / Certificates of
Participation — 13.5%
     
$ 4,250     California Public Works Board Lease Revenue,
(Department of General Services), (AMBAC),
5.00%, 12/1/27(2)
  $ 4,424,463    
  2,250     Orange County Water District, Certificates of
Participation, (MBIA), 5.00%, 8/15/34
    2,297,318    
  1,075     San Jose Financing Authority, (Civic Center),
(AMBAC), 5.00%, 6/1/32
    1,098,145    
          $ 7,819,926    
Insured-Public Education — 7.1%      
$ 4,000     California State University, (AMBAC), 5.00%, 11/1/33   $ 4,121,880    
          $ 4,121,880    
Insured-Special Assessment Revenue — 22.8%      
$ 2,500     Cathedral City Public Financing Authority,
(Housing Redevelopment), (MBIA), 5.00%, 8/1/33
  $ 2,573,500    
  2,500     Cathedral City Public Financing Authority, (Tax
Allocation Redevelopment), (MBIA), 5.00%, 8/1/33
    2,573,500    

 

See notes to financial statements
15



Eaton Vance Insured California Municipal Bond Fund II as of September 30, 2007

PORTFOLIO OF INVESTMENTS CONT'D

Principal Amount
(000's omitted)
 
Security
 
Value
 
Insured-Special Assessment Revenue (continued)      
$ 1,750     Irvine Public Facility and Infrastructure Authority
Assessment, (AMBAC), 5.00%, 9/2/26
  $ 1,809,745    
  2,000     Murrieta Redevelopment Agency Tax, (MBIA),
5.00%, 8/1/32
    2,059,760    
  4,000     San Jose Redevelopment Agency Tax, (MBIA),
5.00%, 8/1/32(1)
    4,205,603    
          $ 13,222,108    
Insured-Special Tax Revenue — 13.2%      
$ 3,405     Hesperia Public Financing Authority, (Redevelopment and
Housing Project), Series A, (XLCA), 5.00%, 9/1/37
  $ 3,500,136    
  13,650     Puerto Rico Sales Tax Financing, (AMBAC),
0.00%, 8/1/54
    1,344,252    
  2,325     Puerto Rico Sales Tax Financing, (MBIA), 0.00%, 8/1/44     383,765    
  4,610     Puerto Rico Sales Tax Financing, (MBIA), 0.00%, 8/1/45     723,816    
  2,905     Puerto Rico Sales Tax Financing, (MBIA), 0.00%, 8/1/46     433,339    
  260     San Francisco, Bay Area Rapid Transportation District
Sales Tax Revenue, (AMBAC), 5.00%, 7/1/31
    267,483    
  985     San Francisco, Bay Area Rapid Transportation District
Sales Tax Revenue, (AMBAC), 5.125%, 7/1/36
    1,022,203    
          $ 7,674,994    
Insured-Transportation — 6.4%      
$ 2,000     Puerto Rico Highway and Transportation Authority,
(FGIC), 5.25%, 7/1/39
  $ 2,224,780    
  3,670     San Joaquin Hills Transportation Corridor Agency,
(MBIA), 0.00%, 1/15/27
    1,480,551    
          $ 3,705,331    
Insured-Utilities — 3.1%      
$ 1,750     Los Angeles Department of Water and Power,
(FGIC), 5.125%, 7/1/41
  $ 1,784,580    
          $ 1,784,580    
Insured-Water Revenue — 10.9%      
$ 1,235     Calleguas Las Virgenes, Public Financing Authority
Revenue (Municipal Water District), Series A, (FGIC),
4.75%, 7/1/37
  $ 1,238,866    
  2,500     Contra Costa Water District, (FSA), 5.00%, 10/1/32(1)     2,578,482    
  1,500     Los Angeles, Department of Water and Power, (MBIA),
3.00%, 7/1/30
    1,150,245    
  1,475     San Francisco City and County Public Utilities Commission,
(FSA), 4.25%, 11/1/33
    1,378,904    
          $ 6,346,497    

 

Principal Amount
(000's omitted)
 
Security
 
Value
 
Water Revenue — 4.4%  
$ 2,500     California Water Resource, (Central Valley),
5.00%, 12/1/29
  $ 2,528,825    
      $ 2,528,825    
Total Tax-Exempt Investments — 168.5%
(identified cost $95,272,525)
      $ 97,752,458    
Other Assets, Less Liabilities — (10.3)%   $ (5,978,981 )  
Auction Preferred Shares Plus Cumulative
Unpaid Dividends — (58.2)%
      $ (33,763,685 )  
Net Assets Applicable to
Common Shares — 100.0%
      $ 58,009,792    

 

AMBAC - AMBAC Financial Group, Inc.

FGIC - Financial Guaranty Insurance Company

FSA - Financial Security Assurance, Inc.

MBIA - Municipal Bond Insurance Association

XLCA - XL Capital Assurance, Inc.

The Fund invests primarily in debt securities issued by California municipalities. The ability of the issuers of the debt securities to meet their obligations may be affected by economic developments in a specific industry or municipality. In order to reduce the risk associated with such economic developments, at September 30, 2007, 85.9% of total investments are backed by bond insurance of various financial institutions and financial guaranty assurance agencies. The aggregate percentage insured by an individual financial institution ranged from 4.9% to 28.7% of total investments.

(1)  Security represents the underlying municipal obligation of an inverse floating rate obligation held by the Fund.

(2)  Security (or a portion thereof) has been segregated to cover margin requirements on open financial futures contracts.

See notes to financial statements
16



Eaton Vance Insured Florida Municipal Bond Fund as of September 30, 2007

PORTFOLIO OF INVESTMENTS

Tax-Exempt Investments — 168.3%      
Principal Amount
(000's omitted)
 
Security
  Value  
Electric Utilities — 2.2%      
$ 200     Puerto Rico Electric Power Authority, DRIVERS,
Variable Rate, 6.79%, 7/1/25(1)(2)
  $ 217,470    
  600     Puerto Rico Electric Power Authority, DRIVERS,
Variable Rate, 6.79%, 7/1/37(1)(2)
    625,548    
          $ 843,018    
Escrowed / Prerefunded — 5.8%      
$ 1,050     Highlands County Health Facilities Authority,
(Adventist Health), Prerefunded to 11/15/12,
5.25%, 11/15/23
  $ 1,129,695    
  1,000     South Miami Health Facility Authority, Hospital Revenue,
(Baptist Health), Prerefunded to 2/1/13,
5.25%, 11/15/33(1)
    1,076,710    
          $ 2,206,405    
Hospital — 10.7%      
$ 490     Brevard County Health Facilities Authority,
(Health First, Inc.), 5.00%, 4/1/36
  $ 487,785    
  500     Highlands County Health Facilities Authority,
(Adventist Glenoaks Hospital/Adventist Healthcare),
5.00%, 11/15/31
    501,460    
  1,000     Orange County Health Facilities Authority,
(Orlando Regional Healthcare), 4.75%, 11/15/36
    934,220    
  1,160     Orange County Health Facilities Authority,
(Orlando Regional Healthcare), 5.125%, 11/15/39
    1,166,357    
  1,000     South Miami Health Facilities Authority, Hospital Revenue,
(Baptist Health), 5.00%, 8/15/42(1)
    997,480    
          $ 4,087,302    
Industrial Development Revenue — 5.5%      
$ 1,960     Liberty Development Corp., (Goldman Sachs
Group, Inc.), 5.25%, 10/1/35
  $ 2,093,496    
          $ 2,093,496    
Insured-Electric Utilities — 10.8%      
$ 1,500     Deltona, Utility System Revenue, (MBIA),
5.00%, 10/1/33
  $ 1,537,515    
  1,600     Jacksonville Electric Authority, Electric System Revenue,
(FSA), 4.75%, 10/1/34(1)
    1,589,632    
  1,000     Lakeland Energy System, (XLCA), 4.75%, 10/1/36     991,440    
          $ 4,118,587    

 

Principal Amount
(000's omitted)
 
Security
  Value  
Insured-Escrowed / Prerefunded — 17.3%      
$ 1,025     Dade County Professional Sports Franchise Facility,
(MBIA), Escrowed to Maturity, 5.25%, 10/1/30
  $ 1,125,901    
  2,250     Orange County Tourist Development Tax, (AMBAC),
Prerefunded to 4/1/12, 5.125%, 10/1/30(3)
    2,394,983    
  2,825     Puerto Rico Highway and Transportation Authority,
(MBIA), Prerefunded to 7/1/16, 5.00%, 7/1/36(3)
    3,087,034    
          $ 6,607,918    
Insured-General Obligations — 9.0%      
$ 1,345     Florida Board of Education, Capital Outlay,
(Public Education), Series A, (MBIA), 5.00%, 6/1/32
  $ 1,379,015    
  2,000     Florida Board of Education, Capital Outlay,
(Public Education), Series F, (MBIA), 5.00%, 6/1/32
    2,050,580    
          $ 3,429,595    
Insured-Other Revenue — 5.4%      
$ 2,000     Village Center Community Development District,
(MBIA), 5.00%, 11/1/32
  $ 2,042,760    
          $ 2,042,760    
Insured-Pooled Loans — 3.9%      
$ 1,520     Florida Municipal Loan Council Revenue,
(MBIA), 0.00%, 4/1/23
  $ 753,099    
  1,520     Florida Municipal Loan Council Revenue,
(MBIA), 0.00%, 4/1/24
    715,130    
          $ 1,468,229    
Insured-Private Education — 8.9%      
$ 2,500     Broward County Educational Facilities Authority,
(Nova Southeastern University), (AGC),
5.00%, 4/1/36
  $ 2,530,225    
  400     Orange County Educational Facility Authority,
(Rollins College Project), (AMBAC), 5.25%, 12/1/32
    421,476    
  400     Orange County Educational Facility Authority,
(Rollins College Project), (AMBAC), 5.25%, 12/1/37
    420,412    
            $ 3,372,113    
Insured-Public Education — 4.5%      
$ 1,700     Florida Capital Improvement Revenue,
(Florida Gulf Coast University Financing Corporation),
(MBIA), 4.75%, 8/1/32
  $ 1,701,615    
          $ 1,701,615    

 

See notes to financial statements
17



Eaton Vance Insured Florida Municipal Bond Fund as of September 30, 2007

PORTFOLIO OF INVESTMENTS CONT'D

Principal Amount
(000's omitted)
 
Security
  Value  
Insured-Sewer Revenue — 2.7%      
$ 1,000     Pinellas County Sewer, (FSA), 5.00%, 10/1/32   $ 1,025,590    
          $ 1,025,590    
Insured-Special Assessment Revenue — 7.5%      
$ 2,780     Julington, Creek Plantation Community Development
District, (MBIA), 5.00%, 5/1/29
  $ 2,840,354    
          $ 2,840,354    
Insured-Special Tax Revenue — 34.9%      
$ 1,500     Dade County, Special Obligation, (AMBAC),
5.00%, 10/1/35(3)
  $ 1,506,530    
  500     Dade County, Special Obligation, Residual Certificates,
(AMBAC), Variable Rate, 6.735%, 10/1/35(1)(2)
    506,530    
  1,500     Jacksonville, Capital Improvements, (AMBAC),
5.00%, 10/1/30
    1,528,245    
  1,275     Jacksonville, Excise Tax, (FGIC), 5.125%, 10/1/27     1,332,451    
  3,750     Jacksonville, Transportation Revenue, (MBIA),
5.00%, 10/1/31
    3,802,275    
  600     Miami-Dade County, Special Obligation, (MBIA),
0.00%, 10/1/35
    142,242    
  8,000     Miami-Dade County, Special Obligation, (MBIA),
0.00%, 10/1/39
    1,527,680    
  225     Miami-Dade County, Special Obligation, (MBIA),
5.00%, 10/1/37
    227,029    
  9,835     Puerto Rico Sales Tax Financing, (AMBAC),
0.00%, 8/1/54
    968,551    
  1,690     Puerto Rico Sales Tax Financing, (MBIA),
0.00%, 8/1/44
    278,951    
  3,350     Puerto Rico Sales Tax Financing, (MBIA),
0.00%, 8/1/45
    525,983    
  2,105     Puerto Rico Sales Tax Financing, (MBIA),
0.00%, 8/1/46
    314,003    
  1,120     Sunrise Public Facilities, (MBIA), 0.00%, 10/1/20     635,578    
          $ 13,296,048    
Insured-Transportation — 14.3%      
$ 2,000     Florida Mid-Bay Bridge Authority, (AMBAC),
4.625%, 10/1/32
  $ 1,957,900    
  1,500     Florida Turnpike Authority, Water & Sewer Revenue,
(Department of Transportation), (FGIC), 4.50%, 7/1/27
    1,483,455    
  1,605     Port Palm Beach District, (Improvements), (XLCA),
0.00%, 9/1/24
    740,884    
  1,950     Port Palm Beach District, (Improvements), (XLCA),
0.00%, 9/1/25
    853,944    
  1,000     Port Palm Beach District, (Improvements), (XLCA),
0.00%, 9/1/26
    415,120    
          $ 5,451,303    

 

Principal Amount
(000's omitted)
 
Security
  Value  
Insured-Utilities — 4.1%  
$ 1,550     Daytona Beach, Utility System Revenue, (AMBAC),
5.00%, 11/15/32(4)
  $ 1,580,055    
      $ 1,580,055    
Insured-Water and Sewer — 19.5%  
$ 1,000     Emerald Coast, Utility Authority Revenue, (FGIC),
4.75%, 1/1/31
  $ 999,230    
  1,500     Jacksonville Electric Authority, Water and Sewer
System, (MBIA), 4.75%, 10/1/30
    1,496,865    
  2,000     Marco Island Utility System, (MBIA),
5.00%, 10/1/27
    2,071,500    
  1,000     Marion County Utility System, (MBIA),
5.00%, 12/1/33
    1,025,550    
  1,500     Port St. Lucie, Utility System Revenue, (MBIA),
0.00%, 9/1/32
    416,445    
  1,455     Port St. Lucie, Utility System Revenue, (MBIA),
0.00%, 9/1/33
    382,927    
  1,000     Sunrise Utility System, (AMBAC), 5.00%, 10/1/28     1,044,350    
      $ 7,436,867    
Insured-Water Revenue — 1.3%  
$ 500     Tampa Bay Water Utility System, (FGIC),
Variable Rate, 5.31%, 10/1/27(1)(5)
  $ 514,835    
      $ 514,835    
Total Tax-Exempt Investments — 168.3% 
(identified cost $62,308,094)
    $ 64,116,090    
Other Assets, Less Liabilities — (9.2)%       $ (3,516,355 )  
Auction Preferred Shares Plus Cumulative  
Unpaid Dividends — (59.1)%
    $ (22,513,870 )  
Net Assets Applicable to   
Common Shares — 100.0%
    $ 38,085,865    

 

AGC - Assured Guaranty Corp.

AMBAC - AMBAC Financial Group, Inc.

DRIVERS - Derivative Inverse Tax-Exempt Receipts

FGIC - Financial Guaranty Insurance Company

FSA - Financial Security Assurance, Inc.

MBIA - Municipal Bond Insurance Association

XLCA - XL Capital Assurance, Inc.

See notes to financial statements
18



Eaton Vance Insured Florida Municipal Bond Fund as of September 30, 2007

PORTFOLIO OF INVESTMENTS CONT'D

The Fund invests primarily in debt securities issued by Florida municipalities. The ability of the issuers of the debt securities to meet their obligations may be affected by economic developments in a specific industry or municipality. In order to reduce the risk associated with such economic developments, at September 30, 2007, 85.6% of total investments are backed by bond insurance of various financial institutions and financial guaranty assurance agencies. The aggregate percentage insured by an individual financial institution ranged from 4.0% to 46.9% of total investments.

(1)  Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be sold in transactions exempt from registration, normally to qualified institutional buyers. At September 30, 2007, the aggregate value of the securities is $5,528,205 or 14.5% of the Fund's net assets applicable to common shares.

(2)  Security has been issued as a leveraged inverse floater bond. The stated interest rate represents the rate in effect at September 30, 2007.

(3)  Security represents the underlying municipal obligation of an inverse floating rate obligation held by the Fund.

(4)  Security (or a portion thereof) has been segregated to cover margin requirements on open financial futures contracts.

(5)  Security has been issued as an inverse floater bond. The stated interest rate represents the rate in effect at September 30, 2007.

See notes to financial statements
19




Eaton Vance Insured Massachusetts Municipal Bond Fund as of September 30, 2007

PORTFOLIO OF INVESTMENTS


Tax-Exempt Investments — 182.5%
     
Principal Amount
(000's omitted)
  Security   Value  
Escrowed / Prerefunded — 8.5%      
$ 1,445     Massachusetts Health and Educational Facilities Authority,
(Partners Healthcare System), Prerefunded to
7/1/11, 5.75%, 7/1/32
  $ 1,568,764    
  600     Massachusetts Development Finance Agency, (Western
New England College), Prerefunded to
12/1/12, 6.125%, 12/1/32
    675,144    
          $ 2,243,908    
Hospital — 4.1%      
$ 55     Massachusetts Health and Educational Facilities Authority,
(Partners Healthcare Systems), 5.75%, 7/1/32
  $ 59,418    
  1,000     Massachusetts Health and Educational Facilities Authority,
(South Shore Hospital), 5.75%, 7/1/29
    1,023,420    
          $ 1,082,838    
Housing — 3.5%      
$ 995     Massachusetts Housing Finance Agency, 4.50%, 6/1/38   $ 935,867    
          $ 935,867    
Insured-Escrowed / Prerefunded — 28.5%      
$ 2,900     Massachusetts College Building Authority, (MBIA),
Escrowed to Maturity, 0.00%, 5/1/26
  $ 1,245,057    
  350     Massachusetts Development Finance Agency, (WGBH
Educational Foundation), (AMBAC), Prerefunded to
1/1/12, 5.375%, 1/1/42
    378,101    
  3,000     Puerto Rico, (FGIC), Prerefunded to
7/1/12, 5.00%, 7/1/32(1)
    3,194,840    
  1,000     Puerto Rico Highway and Transportation Authority, (MBIA),
Prerefunded to 7/1/16, 5.00%, 7/1/36(1)
    1,093,385    
  1,500     University of Massachusetts Building Authority, (AMBAC),
Prerefunded to 11/1/14, 5.125%, 11/1/34
    1,639,545    
          $ 7,550,928    
Insured-General Obligations — 12.1%      
$ 2,000     Massachusetts, (MBIA), 5.25%, 8/1/28   $ 2,234,640    
  1,000     Milford, (FSA), 4.25%, 12/15/46     897,210    
  75     Sandwich, (MBIA), 4.50%, 7/15/29     75,439    
          $ 3,207,289    

 

Principal Amount
(000's omitted)
  Security   Value  
Insured-Hospital — 7.1%      
$ 680     Massachusetts Health and Educational Facilities Authority,
(Lahey Clinic Medical Center), (FGIC), 4.50%, 8/15/35
  $ 642,403    
  1,210     Massachusetts Health and Educational Facilities Authority,
(New England Medical Center), (FGIC), 5.00%, 5/15/25
    1,248,284    
          $ 1,890,687    
Insured-Lease Revenue / Certificates of
Participation — 22.9%
     
$ 1,750     Massachusetts Development Finance Agency, (MBIA),
5.125%, 2/1/34(2)
  $ 1,817,130    
  1,000     Plymouth County Correctional Facility, (AMBAC),
5.00%, 4/1/22
    1,030,450    
  795     Puerto Rico Public Buildings Authority, (CIFG),
5.25%, 7/1/36(1)
    837,270    
  2,205     Puerto Rico Public Buildings Authority, (CIFG), Prerefunded to
7/1/12, 5.25%, 7/1/36(1)
    2,367,160    
          $ 6,052,010    
Insured-Other Revenue — 4.5%      
$ 1,000     Massachusetts Development Finance Agency, (WGBH
Educational Foundation), (AMBAC), 5.75%, 1/1/42
  $ 1,189,440    
          $ 1,189,440    
Insured-Pooled Loans — 9.4%      
$ 2,400     Puerto Rico Municipal Finance Agency, (FSA),
5.00%, 8/1/27(1)
  $ 2,498,136    
          $ 2,498,136    
Insured-Private Education — 26.0%      
$ 1,000     Massachusetts Development Finance Agency, (Boston
University), (XLCA), 5.375%, 5/15/39
  $ 1,107,560    
  1,105     Massachusetts Development Finance Agency, (Boston
University), (XLCA), 6.00%, 5/15/59
    1,333,536    
  750     Massachusetts Development Finance Agency, (College of
the Holy Cross), (AMBAC), 5.25%, 9/1/32(1)
    844,058    
  1,500     Massachusetts Development Finance Agency,
(Franklin W. Olin College), (XLCA), 5.25%, 7/1/33
    1,554,090    
  750     Massachusetts Development Finance Agency, (Massachusetts
College of Pharmacy), (AGC), 5.00%, 7/1/35
    769,088    

 

See notes to financial statements
20



Eaton Vance Insured Massachusetts Municipal Bond Fund as of September 30, 2007

PORTFOLIO OF INVESTMENTS CONT'D

Principal Amount
(000's omitted)
  Security   Value  
Insured-Private Education (continued)      
$ 1,000     Massachusetts Development Finance Agency, (Massachusetts
College of Pharmacy), (AGC), 5.00%, 7/1/37(3)
  $ 1,032,290    
  250     Massachusetts Industrial Finance Agency, (Tufts University),
(MBIA), 4.75%, 2/15/28
    250,948    
          $ 6,891,570    
Insured-Public Education — 11.4%      
$ 700     Massachusetts College Building Authority, (XLCA),
5.50%, 5/1/39
  $ 802,445    
  1,000     Massachusetts Health and Educational Facilities Authority,
(University of Massachusetts), (FGIC), 5.125%, 10/1/34
    1,039,010    
  1,150     Massachusetts Health and Educational Facilities Authority,
(Worcester State College), (AMBAC), 5.00%, 11/1/32
    1,179,222    
          $ 3,020,677    
Insured-Special Tax Revenue — 11.2%      
$ 1,280     Martha's Vineyard Land Bank, (AMBAC), 5.00%, 5/1/32(4)   $ 1,312,358    
  380     Massachusetts Bay Transportation Authority, Revenue
Assessment, (MBIA), 4.00%, 7/1/33
    340,381    
  6,200     Puerto Rico Sales Tax Financing, (AMBAC), 0.00%, 8/1/54     610,576    
  1,055     Puerto Rico Sales Tax Financing, (MBIA), 0.00%, 8/1/44     174,138    
  2,095     Puerto Rico Sales Tax Financing, (MBIA), 0.00%, 8/1/45     328,936    
  1,325     Puerto Rico Sales Tax Financing, (MBIA), 0.00%, 8/1/46     197,650    
          $ 2,964,039    
Insured-Transportation — 10.2%      
$ 3,700     Massachusetts Turnpike Authority, (MBIA), 0.00%, 1/1/28   $ 1,426,646    
  1,250     Massachusetts Turnpike Authority, Metropolitan Highway
System, (AMBAC), 5.00%, 1/1/39
    1,259,850    
          $ 2,686,496    
Insured-Water Revenue — 13.6%      
$ 1,175     Massachusetts Water Resources Authority, (AMBAC),
4.00%, 8/1/40
  $ 1,028,583    
  2,500     Massachusetts Water Resources Authority, (FSA),
5.00%, 8/1/32
    2,563,100    
          $ 3,591,683    
Nursing Home — 2.7%      
$ 745     Massachusetts Development Finance Agency, (Berkshire
Retirement Community, Inc./Edgecombe), 5.15%, 7/1/31
  $ 704,830    
          $ 704,830    

 

Principal Amount
(000's omitted)
  Security   Value  
Private Education — 6.8%      
$ 500     Massachusetts Development Finance Agency, (Massachusetts
College of Pharmacy), 5.75%, 7/1/33
  $ 525,625    
  750     Massachusetts Development Finance Agency, (Middlesex
School), 5.00%, 9/1/33
    762,075    
  500     Massachusetts Health and Educational Facilities Authority,
(Boston College), 5.125%, 6/1/24
    518,430    
          $ 1,806,130    
Total Tax-Exempt Investments — 182.5%
(identified cost $46,505,289)
  $ 48,316,528    
Other Assets, Less Liabilities — (23.9)%   $ (6,335,719 )  
Auction Preferred Shares Plus Cumulative
Unpaid Dividends — (58.6)%
  $ (15,504,650 )  
Net Assets Applicable to
Common Shares — 100.0%
  $ 26,476,159    

 

AGC - Assured Guaranty Corp.

AMBAC - AMBAC Financial Group, Inc.

CIFG - CIFG Assurance North America, Inc.

FGIC - Financial Guaranty Insurance Company

FSA - Financial Security Assurance, Inc.

MBIA - Municipal Bond Insurance Association

XLCA - XL Capital Assurance, Inc.

The Fund invests primarily in debt securities issued by Massachusetts municipalities. The ability of the issuers of the debt securities to meet their obligations may be affected by economic developments in a specific industry or municipality. In order to reduce the risk associated with such economic developments, at September 30, 2007, 86.0% of total investments are backed by bond insurance of various financial institutions and financial guaranty assurance agencies. The aggregate percentage insured by an individual financial institution ranged from 3.7% to 21.7% of total investments.

(1)  Security represents the underlying municipal obligation of an inverse floating rate obligation held by the Fund.

(2)  Security (or a portion thereof) has been segregated to cover payable for when-issued securities.

(3)  When-issued security.

(4)  Security (or a portion thereof) has been segregated to cover margin requirements on open financial futures contracts.

See notes to financial statements
21



Eaton Vance Insured Michigan Municipal Bond Fund as of September 30, 2007

PORTFOLIO OF INVESTMENTS


Tax-Exempt Investments — 182.7%
     
Principal Amount
(000's omitted)
  Security   Value  
Electric Utilities — 5.6%      
$ 1,250     Michigan Strategic Fund, (Detroit Edison Pollution Control),
5.45%, 9/1/29
  $ 1,277,537    
          $ 1,277,537    
Escrowed / Prerefunded — 7.1%      
$ 1,500     Michigan Hospital Finance Authority, (Sparrow Obligation
Group), Prerefunded to 11/15/11, 5.625%, 11/15/36
  $ 1,629,390    
          $ 1,629,390    
Hospital — 13.0%      
$ 400     Michigan Hospital Finance Authority, (Chelsea Community
Hospital), 5.00%, 5/15/30
  $ 375,492    
  1,000     Michigan Hospital Finance Authority, (Oakwood Hospital
System), 5.75%, 4/1/32
    1,040,350    
  1,500     Michigan Hospital Finance Authority, (Trinity Health),
5.375%, 12/1/30
    1,554,645    
          $ 2,970,487    
Insured-Electric Utilities — 2.2%      
$ 500     Michigan Strategic Fund, Resource Recovery, (Detroit
Edison Co.), (XLCA), 5.25%, 12/15/32
  $ 515,230    
          $ 515,230    
Insured-Escrowed / Prerefunded — 48.2%      
$ 750     Detroit School District, (School Bond Loan Fund), (FSA),
Prerefunded to 5/1/12, 5.125%, 5/1/31
  $ 799,125    
  1,250     Detroit Sewer Disposal, (FGIC), Prerefunded to
7/1/11, 5.125%, 7/1/31
    1,318,850    
  1,500     Lansing Building Authority, (MBIA), Prerefunded to 6/1/13,
5.00%, 6/1/29
    1,606,455    
  1,150     Michigan Hospital Finance Authority, (St. John Health System),
(AMBAC), Escrowed to Maturity, 5.00%, 5/15/28
    1,169,251    
  1,000     Michigan Trunk Line, (FSA), Prerefunded to 11/1/11,
5.00%, 11/1/25
    1,054,930    
  3,275     Puerto Rico, (FGIC), Prerefunded to 7/1/12,
5.00%, 7/1/32(1)
    3,488,349    
  1,500     Reed City Public Schools, (FSA), Prerefunded to 5/1/14,
5.00%, 5/1/29
    1,618,095    
          $ 11,055,055    

 

Principal Amount
(000's omitted)
  Security   Value  
Insured-General Obligations — 15.9%      
$ 325     Brandon School District, (FSA), 4.50%, 5/1/35   $ 317,405    
  1,960     Grand Rapids and Kent County Joint Building Authority,
(DeVos Place), (MBIA), 0.00%, 12/1/27
    760,206    
  750     Greenville Public Schools, (MBIA), 5.00%, 5/1/25     774,330    
  1,330     Okemos Public School District, (MBIA), 0.00%, 5/1/19     808,547    
  1,000     Van Buren Township, (Local Development Financial Authority),
(XLCA), 4.50%, 10/1/31
    979,150    
          $ 3,639,638    
Insured-Hospital — 9.3%      
$ 500     Michigan Hospital Finance Authority, Mid-Michigan
Obligation Group, (AMBAC), 5.00%, 4/15/32
  $ 506,985    
  1,590     Royal Oak Hospital Finance Authority Revenue, (William
Beaumont Hospital), (MBIA), 5.25%, 11/15/35
    1,625,091    
          $ 2,132,076    
Insured-Lease Revenue / Certificates of
Participation — 27.7%
     
$ 1,750     Michigan House of Representatives, (AMBAC),
0.00%, 8/15/22
  $ 898,572    
  2,615     Michigan House of Representatives, (AMBAC),
0.00%, 8/15/23
    1,275,937    
  3,100     Michigan State Building Authority, (FGIC),
0.00%, 10/15/30
    966,797    
  795     Puerto Rico Public Buildings Authority, (CIFG),
5.25%, 7/1/36(1)
    837,312    
  2,205     Puerto Rico Public Buildings Authority, (CIFG), Prerefunded to
7/1/12, 5.25%, 7/1/36(1)
    2,367,118    
          $ 6,345,736    
Insured-Public Education — 10.2%      
$ 1,500     Central Michigan University, (AMBAC), 5.05%, 10/1/32(2)   $ 1,547,460    
  750     Lake Superior State University, (AMBAC), 5.125%, 11/15/26     780,345    
          $ 2,327,805    
Insured-Special Tax Revenue — 16.7%      
$ 7,030     Puerto Rico Sales Tax Financing, (AMBAC), 0.00%, 8/1/54   $ 692,314    
  845     Puerto Rico Sales Tax Financing, (MBIA), 0.00%, 8/1/44     139,476    
  1,675     Puerto Rico Sales Tax Financing, (MBIA), 0.00%, 8/1/45     262,992    
  1,115     Puerto Rico Sales Tax Financing, (MBIA), 0.00%, 8/1/46     166,325    
  1,500     Wayne Charter County, (Airport Hotel-Detroit Metropolitan
Airport), (MBIA), 5.00%, 12/1/30
    1,538,715    
  1,000     Ypsilanti, Community Utilities Authority, (San Sewer System),
(FGIC), 5.00%, 5/1/32
    1,025,120    
          $ 3,824,942    

 

See notes to financial statements
22



Eaton Vance Insured Michigan Municipal Bond Fund as of September 30, 2007

PORTFOLIO OF INVESTMENTS CONT'D

Principal Amount
(000's omitted)
  Security   Value  
Insured-Utility — 6.8%      
$ 1,000     Lansing Board Water Supply, Steam and Electric Utility,
(FSA), 5.00%, 7/1/25
  $ 1,036,800    
  510     Lansing Board Water Supply, Steam and Electric Utility,
(FSA), 5.00%, 7/1/26
    529,431    
          $ 1,566,231    
Insured-Water Revenue — 17.8%      
$ 1,600     Detroit Water Supply System, (FGIC), 5.00%, 7/1/30   $ 1,627,552    
  2,400     Detroit Water Supply System, (MBIA), 5.00%, 7/1/34(1)     2,452,177    
          $ 4,079,729    
Private Education — 2.2%      
$ 500     Michigan Higher Education Facilities Authority, (Hillsdale
College), 5.00%, 3/1/35
  $ 499,240    
          $ 499,240    
Total Tax-Exempt Investments — 182.7%
(identified cost $40,054,949)
  $ 41,863,096    
Other Assets, Less Liabilities — (23.8)%   $ (5,444,684 )  
Auction Preferred Shares Plus Cumulative
Unpaid Dividends — (58.9)%
  $ (13,506,565 )  
Net Assets Applicable to
Common Shares — 100.0%
  $ 22,911,847    

 

AMBAC - AMBAC Financial Group, Inc.

CIFG - CIFG Assurance North America, Inc.

FGIC - Financial Guaranty Insurance Company

FSA - Financial Security Assurance, Inc.

MBIA - Municipal Bond Insurance Association

XLCA - XL Capital Assurance, Inc.

The Fund invests primarily in debt securities issued by Michigan municipalities. The ability of the issuers of the debt securities to meet their obligations may be affected by economic developments in a specific industry or municipality. In order to reduce the risk associated with such economic developments, at September 30, 2007, 84.8% of total investments are backed by bond insurance of various financial institutions and financial guaranty assurance agencies. The aggregate percentage insured by an individual financial institution ranged from 3.6% to 24.2% of total investments.

(1)  Security represents the underlying municipal obligation of an inverse floating rate obligation held by the Fund.

(2)  Security (or a portion thereof) has been segregated to cover margin requirements on open financial futures contracts.

See notes to financial statements
23



Eaton Vance Insured New Jersey Municipal Bond Fund as of September 30, 2007

PORTFOLIO OF INVESTMENTS


Tax-Exempt Investments — 179.4%
     
Principal Amount
(000's omitted)
  Security   Value  
Hospital — 13.1%      
$ 100     Camden County Improvement Authority, (Cooper Health
System), 5.00%, 2/15/25
  $ 98,681    
  180     Camden County Improvement Authority, (Cooper Health
System), 5.00%, 2/15/35
    171,608    
  150     Camden County Improvement Authority, (Cooper Health
System), 5.25%, 2/15/27
    150,765    
  1,300     Camden County Improvement Authority, (Cooper Health
System), 5.75%, 2/15/34
    1,336,673    
  600     New Jersey Health Care Facilities Financing Authority,
(Atlanticare Regional Medical Center), 5.00%, 7/1/37
    600,642    
  610     New Jersey Health Care Facilities Financing Authority,
(Capital Health System), 5.375%, 7/1/33
    614,599    
  575     New Jersey Health Care Facilities Financing Authority,
(Capital Health System), 5.75%, 7/1/23
    598,776    
  250     New Jersey Health Care Facilities Financing Authority,
(Hunterdon Medical Center), 5.125%, 7/1/35
    252,352    
  600     New Jersey Health Care Facilities Financing Authority,
(South Jersey Hospital), 5.00%, 7/1/36
    603,972    
  845     New Jersey Health Care Facilities Financing Authority,
(South Jersey Hospital), 5.00%, 7/1/46
    845,769    
          $ 5,273,837    
Insured-Escrowed / Prerefunded — 39.6%      
$ 1,250     Jersey City, (FSA), Prerefunded to
9/1/11, 5.25%, 9/1/23
  $ 1,350,637    
  2,405     Lafayette Yard Community Development Corporation,
(Hotel and Conference Center), (FGIC), Prerefunded to
4/1/11, 5.00%, 4/1/35
    2,521,907    
  1,200     New Jersey Economic Development Authority, (School
Facilities), (FGIC), Prerefunded to
7/1/12, 5.00%, 7/1/32
    1,275,768    
  1,000     New Jersey Educational Facilities Authority, (Kean University),
(FGIC), Prerefunded to 7/1/13, 5.00%, 7/1/28
    1,072,440    
  1,500     New Jersey Educational Facilities Authority, (Rowan University),
(FGIC), Prerefunded to 7/1/13, 5.125%, 7/1/30
    1,618,335    
  800     Newark Housing Authority, (Newark Marine Terminal), (MBIA),
Prerefunded to 1/1/14, 5.00%, 1/1/23
    860,128    
  1,500     Newark Housing Authority, (Newark Marine Terminal), (MBIA),
Prerefunded to 1/1/14, 5.00%, 1/1/37
    1,612,740    
  650     Puerto Rico Highway and Transportation Authority, (MBIA),
Prerefunded to 7/1/13, 5.00%, 7/1/33
    698,834    
  4,645     Puerto Rico, (FGIC), Prerefunded to 7/1/12,
5.00%, 7/1/32(1)
    4,947,002    
          $ 15,957,791    

 

Principal Amount
(000's omitted)
  Security   Value  
Insured-General Obligations — 33.5%      
$ 2,260     Bayonne, (FSA), 0.00%, 7/1/22   $ 1,178,658    
  2,415     Bayonne, (FSA), 0.00%, 7/1/23     1,197,743    
  1,000     Bordentown Regional School District Board of Education,
(MBIA), 4.25%, 1/15/33
    956,440    
  2,000     Hudson County Improvement Authority, (MBIA),
0.00%, 12/15/38
    440,020    
  5,500     Irvington Township, (FSA), 0.00%, 7/15/26     2,326,500    
  2,960     Jackson Township School District, (MBIA),
2.50%, 6/15/27
    2,163,020    
  350     Livingston Township School District, (FGIC),
4.50%, 7/15/32(2)
    350,035    
  505     Livingston Township School District, (FGIC),
4.50%, 7/15/33(2)
    504,586    
  250     Livingston Township School District, (FGIC),
4.50%, 7/15/36(2)
    248,745    
  246     Livingston Township School District, (FGIC),
4.50%, 7/15/37(2)
    244,745    
  530     Madison Borough Board of Education, (MBIA),
4.75%, 7/15/35
    537,727    
  265     Nutley School District (MBIA), 4.50%, 7/15/29     267,054    
  310     Nutley School District (MBIA), 4.75%, 7/15/30     318,169    
  410     Nutley School District (MBIA), 4.75%, 7/15/31     420,148    
  430     Nutley School District (MBIA), 4.75%, 7/15/32     440,264    
  450     Old Bridge Township Board of Education, (MBIA),
4.375%, 7/15/32
    439,056    
  1,500     Sparta Township School District, (FSA), 4.30%, 2/15/34     1,443,780    
          $ 13,476,690    
Insured-Hospital — 9.2%      
$ 2,750     New Jersey Health Care Facilities Financing Authority,
(Englewood Hospital), (MBIA), 5.00%, 8/1/31
  $ 2,808,465    
  900     New Jersey Health Care Facilities Financing Authority,
(Jersey City Medical Center), (AMBAC), 5.00%, 8/1/41
    908,865    
          $ 3,717,330    
Insured-Lease Revenue / Certificates of
Participation — 15.6%
     
$ 445     Gloucester County Improvements Authority, (MBIA),
4.75%, 9/1/30
  $ 451,889    
  610     Hudson County Improvements Authority, (FSA),
4.50%, 4/1/35
    604,669    
  265     Lafayette Yard Community Development Corporation,
(Hotel and Conference Center), (FGIC), 5.00%, 4/1/35
    269,728    
  1,250     Middlesex County, (MBIA), 5.00%, 8/1/31(3)     1,272,413    
  795     Puerto Rico Public Buildings Authority, (CIFG),
5.25%, 7/1/36(1)
    837,270    

 

See notes to financial statements
24



Eaton Vance Insured New Jersey Municipal Bond Fund as of September 30, 2007

PORTFOLIO OF INVESTMENTS CONT'D

Principal Amount
(000's omitted)
  Security   Value  
Insured-Lease Revenue / Certificates of
Participation (continued)
     
$ 2,205     Puerto Rico Public Buildings Authority, (CIFG),
Prerefunded to 7/1/12, 5.25%, 7/1/36(1)
  $ 2,367,160    
  475     University of New Jersey Medicine and Dentistry,
Certificates of Participation, (MBIA), 5.00%, 6/15/36
    489,293    
          $ 6,292,422    
Insured-Pooled Loans — 7.4%      
$ 2,850     Puerto Rico Municipal Finance Agency, (FSA),
5.00%, 8/1/27(1)
  $ 2,966,537    
          $ 2,966,537    
Insured-Public Education — 11.2%      
$ 425     New Jersey Educational Facilities Authority, (Ramapo
College), (AMBAC), 4.25%, 7/1/31
  $ 407,409    
  3,990     University of New Jersey Medicine and Dentistry, (AMBAC),
5.00%, 4/15/32
    4,102,478    
          $ 4,509,887    
Insured-Sewer Revenue — 2.5%      
$ 2,500     Rahway Valley Sewerage Authority, (MBIA),
0.00%, 9/1/27
  $ 990,700    
          $ 990,700    
Insured-Special Tax Revenue — 8.2%      
$ 2,390     New Jersey Economic Development Authority, (XLCA),
0.00%, 7/1/26
  $ 987,118    
  1,120     New Jersey Economic Development Authority, (XLCA),
0.00%, 7/1/27
    438,726    
  8,940     Puerto Rico Sales Tax Financing, (AMBAC), 0.00%, 8/1/54     880,411    
  1,520     Puerto Rico Sales Tax Financing, (MBIA), 0.00%, 8/1/44     250,891    
  3,015     Puerto Rico Sales Tax Financing, (MBIA), 0.00%, 8/1/45     473,385    
  1,900     Puerto Rico Sales Tax Financing, (MBIA), 0.00%, 8/1/46     283,423    
          $ 3,313,954    
Insured-Transportation — 19.1%      
$ 740     Delaware River Joint Toll Bridge Commission, Series A,
(MBIA), 4.50%, 7/1/37
  $ 730,506    
  490     Morristown Parking Authority, (MBIA), 4.50%, 8/1/37     484,968    
  3,875     Port Authority of New York and New Jersey, (FSA),
5.00%, 11/1/27(1)
    4,028,355    
  350     Puerto Rico Highway and Transportation Authority, (MBIA),
5.00%, 7/1/33
    360,469    

 

Principal Amount
(000's omitted)
  Security   Value  
Insured-Transportation (continued)      
$ 2,000     South Jersey Transportation Authority, (FGIC),
5.00%, 11/1/33
  $ 2,069,260    
          $ 7,673,558    
Insured-Water and Sewer — 7.5%      
$ 4,500     Middlesex County Improvements Authority Utilities System,
(Perth Amboy), (AMBAC), 0.00%, 9/1/24(4)
  $ 2,101,410    
  1,320     Passaic Valley, Sewer Commissioners, (FGIC),
2.50%, 12/1/32
    904,081    
          $ 3,005,491    
Senior Living / Life Care — 1.5%      
$ 600     New Jersey Economic Development Authority, (Fellowship
Village), 5.50%, 1/1/25
  $ 603,420    
          $ 603,420    
Special Tax Revenue — 3.2%      
$ 500     New Jersey Economic Development Authority, (Cigarette
Tax), 5.50%, 6/15/31
  $ 514,785    
  750     New Jersey Economic Development Authority, (Cigarette
Tax), 5.75%, 6/15/34
    788,010    
          $ 1,302,795    
Transportation — 7.8%      
$ 1,250     Port Authority of New York and New Jersey,
5.00%, 9/1/38
  $ 1,286,613    
  1,825     South Jersey Port Authority, (Marine Terminal),
5.10%, 1/1/33
    1,864,073    
          $ 3,150,686    
Total Tax-Exempt Investments — 179.4%
(identified cost $69,406,338)
  $ 72,235,098    
Other Assets, Less Liabilities — (23.5)%   $ (9,458,968 )  
Auction Preferred Shares Plus Cumulative
Unpaid Dividends — (55.9)%
  $ (22,513,685 )  
Net Assets Applicable to
Common Shares — 100.0%
  $ 40,262,445    

 

See notes to financial statements
25



Eaton Vance Insured New Jersey Municipal Bond Fund as of September 30, 2007

PORTFOLIO OF INVESTMENTS CONT'D

AMBAC - AMBAC Financial Group, Inc.

CIFG - CIFG Assurance North America, Inc.

FGIC - Financial Guaranty Insurance Company

FSA - Financial Security Assurance, Inc.

MBIA - Municipal Bond Insurance Association

XLCA - XL Capital Assurance, Inc.

The Fund invests primarily in debt securities issued by New Jersey municipalities. The ability of the issuers of the debt securities to meet their obligations may be affected by economic developments in a specific industry or municipality. In order to reduce the risk associated with such economic developments, at September 30, 2007, 85.7% of total investments are backed by bond insurance of various financial institutions and financial guaranty assurance agencies. The aggregate percentage insured by an individual financial institution ranged from 2.0% to 24.6% of total investments.

(1)  Security represents the underlying municipal obligation of an inverse floating rate obligation held by the Fund.

(2)  When-issued security.

(3)  Security (or a portion thereof) has been segregated to cover margin requirements on open financial futures contracts.

(4)  Security (or a portion thereof) has been segregated to cover payable for when-issued securities.

See notes to financial statements
26




Eaton Vance Insured New York Municipal Bond Fund II as of September 30, 2007

PORTFOLIO OF INVESTMENTS


Tax-Exempt Investments — 168.5%
     
Principal Amount
(000's omitted)
  Security   Value  
General Obligations — 5.8%      
$ 1,650     New York, 5.25%, 1/15/28   $ 1,714,333    
  500     New York City, 5.25%, 8/15/26     525,120    
            $ 2,239,453    
Hospital — 4.0%      
$ 750     New York Dormitory Authority, (Memorial Sloan-Kettering
Cancer Center), 5.00%, 7/1/34
  $ 765,502    
  750     Suffolk County Industrial Development Agency, (Huntington
Hospital), 5.875%, 11/1/32
    771,337    
            $ 1,536,839    
Industrial Development Revenue — 3.4%      
$ 1,000     Liberty Development Corp., (Goldman Sachs Group, Inc.),
5.25%, 10/1/35
  $ 1,068,110    
  240     Liberty Development Corp., (Goldman Sachs Group, Inc.),
5.50%, 10/1/37
    268,008    
            $ 1,336,118    
Insured-Electric Utilities — 5.9%      
$ 2,250     Long Island Power Authority, (AMBAC), 5.00%, 9/1/34   $ 2,312,325    
            $ 2,312,325    
Insured-Escrowed / Prerefunded — 10.7%      
$ 580     New York City Cultural Resource Trust, (Museum of
History), (AMBAC), Prerefunded to 7/1/09,
Variable Rate, 8.909%, 7/1/29(1)(2)
  $ 663,224    
  515     New York Dormitory Authority, (University of Rochester),
(MBIA), Prerefunded to 7/1/08, 5.00%, 7/1/27
    526,052    
  1,500     Puerto Rico, (FGIC), Prerefunded to
7/1/12, 5.00%, 7/1/32(3)
    1,597,420    
  1,295     Puerto Rico Highway and Transportation Authority, (MBIA),
Prerefunded to 7/1/13, 5.00%, 7/1/33
    1,392,293    
            $ 4,178,989    
Insured-General Obligations — 6.0%      
$ 2,245     New York Dormitory Authority, (School Districts Financing
Program), (MBIA), 5.00%, 10/1/30
  $ 2,315,538    
            $ 2,315,538    

 

Principal Amount
(000's omitted)
 
Security
 
Value
 
Insured-Hospital — 1.0%      
$ 360     New York Dormitory Authority, (Health Quest Systems),
(AGC), Series B, 5.125%, 7/1/37
  $ 370,843    
            $ 370,843    
Insured-Lease Revenue / Certificates of
Participation — 11.3%
     
$ 1,250     Hudson Yards Infrastructure Corp., (MBIA),
4.50%, 2/15/47
  $ 1,202,038    
  795     Puerto Rico Public Buildings Authority, (CIFG),
5.25%, 7/1/36(3)
    837,270    
  2,205     Puerto Rico Public Buildings Authority, (CIFG),
Prerefunded to 7/1/12, 5.25%, 7/1/36(3)
    2,367,160    
            $ 4,406,468    
Insured-Other Revenue — 24.1%      
$ 1,930     New York City Cultural Resource Trust, (American
Museum of Natural History), (MBIA), 5.00%, 7/1/44
  $ 1,975,741    
  2,000     New York City Cultural Resource Trust, (Museum of
Modern Art), (AMBAC), 5.125%, 7/1/31
    2,087,320    
  2,000     New York City Industrial Development Agency, (Queens
Baseball Stadium), (AMBAC), 4.75%, 1/1/42
    2,000,600    
  1,550     New York City Industrial Development Agency, (Yankee
Stadium), (FGIC), 4.50%, 3/1/39
    1,517,512    
  1,825     New York City Industrial Development Agency, (Yankee
Stadium), (MBIA), 4.75%, 3/1/46
    1,810,583    
            $ 9,391,756    
Insured-Private Education — 29.5%      
$ 1,000     New York City Industrial Development Agency, (New York
University), (AMBAC), 5.00%, 7/1/31
  $ 1,018,950    
  1,440     New York Dormitory Authority, (Barnard College), (FGIC),
5.00%, 7/1/24
    1,523,678    
  2,500     New York Dormitory Authority, (Brooklyn Law School),
(XLCA), 5.125%, 7/1/30
    2,581,525    
  2,265     New York Dormitory Authority, (FIT Student Housing
Corp.), (FGIC), Prerefunded to 7/1/14, 5.00%, 7/1/29
    2,450,073    
  605     New York Dormitory Authority, (Fordham University),
(FGIC), 5.00%, 7/1/32
    622,013    
  1,000     New York Dormitory Authority, (New York University),
(AMBAC), 5.00%, 7/1/31
    1,018,950    
  500     New York Dormitory Authority, (Skidmore College),
(FGIC), 5.00%, 7/1/33
    514,835    
  110     New York Dormitory Authority, (University of Rochester),
(MBIA), 5.00%, 7/1/27
    112,003    
  5,425     Oneida County Industrial Development Agency, (Hamilton
College), (MBIA), 0.00%, 7/1/32
    1,645,891    
            $ 11,487,918    

 

See notes to financial statements
27



Eaton Vance Insured New York Municipal Bond Fund II as of September 30, 2007

PORTFOLIO OF INVESTMENTS CONT'D

Principal Amount
(000's omitted)
 
Security
 
Value
 
Insured-Public Education — 4.3%      
$ 1,500     New York Dormitory Authority, (City University), (AMBAC),
5.25%, 7/1/30
  $ 1,667,070    
            $ 1,667,070    
Insured-Special Tax Revenue — 17.3%      
$ 700     New York Convention Center Development Corp., Hotel
Occupancy Tax, (AMBAC), 4.75%, 11/15/45
  $ 697,025    
  400     New York Convention Center Development Corp., Hotel
Occupancy Tax, (AMBAC), 5.00%, 11/15/44
    409,284    
  1,700     Puerto Rico Infrastructure Financing Authority, (AMBAC),
0.00%, 7/1/35
    441,898    
  9,835     Puerto Rico Sales Tax Financing, (AMBAC), 0.00%, 8/1/54     968,551    
  20,540     Puerto Rico Sales Tax Financing, (MBIA), 0.00%, 8/1/44     3,390,332    
  3,350     Puerto Rico Sales Tax Financing, (MBIA), 0.00%, 8/1/45     525,984    
  2,105     Puerto Rico Sales Tax Financing, (MBIA), 0.00%, 8/1/46     314,003    
            $ 6,747,077    
Insured-Transportation — 23.1%      
$ 1,500     Metropolitan Transportation Authority, (FGIC),
4.75%, 11/15/37
  $ 1,508,910    
  2,000     Metropolitan Transportation Authority, Transportation
Revenue Bonds, (FGIC), 5.25%, 11/15/31
    2,108,180    
  2,500     Port Authority of New York and New Jersey, (FSA),
5.00%, 11/1/27(3)
    2,599,265    
  705     Puerto Rico Highway and Transportation Authority, (MBIA),
5.00%, 7/1/33
    726,087    
  2,000     Triborough Bridge and Tunnel Authority, (MBIA),
5.00%, 11/15/32
    2,056,780    
            $ 8,999,222    
Insured-Water and Sewer — 7.9%      
$ 3,000     New York City Municipal Water Finance Authority, (Water
and Sewer System), (AMBAC), 5.00%, 6/15/38(4)
  $ 3,070,980    
            $ 3,070,980    
Other Revenue — 1.5%      
$ 500     Puerto Rico Infrastructure Financing Authority, Variable
Rate, 8.487%, 10/1/32(1)(2)
  $ 584,135    
            $ 584,135    
Private Education — 5.2%      
$ 1,000     Dutchess County Industrial Development Agency, (Marist
College), 5.00%, 7/1/22
  $ 1,028,620    
  1,000     New York City Industrial Development Agency, (St. Francis
College), 5.00%, 10/1/34
    999,990    
            $ 2,028,610    

 

Principal Amount
(000's omitted)
 
Security
 
Value
 
Transportation — 2.6%      
$ 1,000     Port Authority of New York and New Jersey,
5.00%, 9/1/38
  $ 1,029,290    
            $ 1,029,290    
Water Revenue — 4.9%      
$ 950     New York State Environmental Facilities Corp., Clean
Water, (Municipal Water Finance), 4.50%, 6/15/36
  $ 931,171    
  1,000     New York State Environmental Facilities Corp., Clean Water,
(Municipal Water Finance), Series A, 4.50%, 6/15/36
    980,180    
            $ 1,911,351    
Total Tax-Exempt Investments — 168.5%
(identified cost $63,766,544)
  $ 65,613,982    
Other Assets, Less Liabilities — (10.7)%   $ (4,157,192 )  
Auction Preferred Shares Plus Cumulative
Unpaid Dividends — (57.8)%
  $ (22,509,861 )  
Net Assets Applicable to
Common Shares — 100.0%
  $ 38,946,929    

 

AGC - Assured Guaranty Corp.

AMBAC - AMBAC Financial Group, Inc.

CIFG - CIFG Assurance North America, Inc.

FGIC - Financial Guaranty Insurance Company

FSA - Financial Security Assurance, Inc.

MBIA - Municipal Bond Insurance Association

XLCA - XL Capital Assurance, Inc.

The Fund invests primarily in debt securities issued by New York municipalities. The ability of the issuers of the debt securities to meet their obligations may be affected by economic developments in a specific industry or municipality. In order to reduce the risk associated with such economic developments, at September 30, 2007, 83.7% of total investments are backed by bond insurance of various financial institutions and financial guaranty assurance agencies. The aggregate percentage insured by an individual financial institution ranged from 0.6% to 27.4% of total investments.

(1)  Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be sold in transactions exempt from registration, normally to qualified institutional buyers. At September 30, 2007, the aggregate value of the securities is $1,247,359 or 3.2% of the Fund's net assets applicable to common shares.

(2)  Security has been issued as a leveraged inverse floater bond. The stated interest rate represents the rate in effect at September 30, 2007.

(3)  Security represents the underlying municipal obligation of an inverse floating rate obligation held by the Fund.

(4)  Security (or a portion thereof) has been segregated to cover margin requirements on open financial futures contracts.

See notes to financial statements
28



Eaton Vance Insured Ohio Municipal Bond Fund as of September 30, 2007

PORTFOLIO OF INVESTMENTS


Tax-Exempt Investments — 169.2%
     
Principal Amount
(000's omitted)
 
Security
 
Value
 
Escrowed / Prerefunded — 2.3%      
$ 790     Puerto Rico Electric Power Authority, Prerefunded to
7/1/13, 5.125%, 7/1/29
  $ 854,456    
            $ 854,456    
Hospital — 6.3%      
$ 900     Cuyahoga County, (Cleveland Clinic Health System),
5.50%, 1/1/29
  $ 941,193    
  500     Miami County, (Upper Valley Medical Center),
5.25%, 5/15/26
    505,325    
  1,000     Ohio Higher Educational Facilities Authority, (University
Hospital Health Systems, Inc.), Series A, 4.75%, 1/15/46
    925,500    
            $ 2,372,018    
Insured-Electric Utilities — 22.3%      
$ 4,000     Ohio Municipal Electric Generation Agency, (MBIA),
0.00%, 2/15/25
  $ 1,796,160    
  1,775     Ohio Municipal Electric Generation Agency, (MBIA),
0.00%, 2/15/26
    755,706    
  5,000     Ohio Municipal Electric Generation Agency, (MBIA),
0.00%, 2/15/27
    2,024,450    
  2,000     Ohio Water Development Authority, (Dayton Power &
Light), (FGIC), 4.80%, 1/1/34
    2,006,920    
  1,800     Puerto Rico Electric Power Authority, (MBIA),
4.75%, 7/1/33(1)
    1,819,308    
            $ 8,402,544    
Insured-Escrowed / Prerefunded — 15.8%      
$ 420     Cleveland Airport System, (FSA), Prerefunded to
1/1/10, 5.00%, 1/1/31
  $ 437,195    
  1,000     Olentangy School District, (School Facility Construction
and Improvements), (MBIA), Prerefunded to
12/1/12, 5.00%, 12/1/30
    1,067,220    
  2,500     Springboro Community School District, (MBIA),
Prerefunded to 6/1/14, 5.00%, 12/1/32
    2,698,975    
  1,100     Trotwood-Madison City School District, (School
Improvements), (FGIC), Prerefunded to 12/1/12,
5.00%, 12/1/30
    1,173,942    
  500     University of Akron, (FGIC), Prerefunded to 1/1/10,
Variable Rate, 7.31%, 1/1/29(2)(3)
    557,075    
            $ 5,934,407    

 

Principal Amount
(000's omitted)
 
Security
 
Value
 
Insured-General Obligations — 34.2%      
$ 1,500     Ashtabula School District, (Construction Improvements),
(FGIC), 5.00%, 12/1/30(4)
  $ 1,538,715    
  810     Cleveland, (FGIC), 4.75%, 11/15/25     829,140    
  655     Cleveland, (FGIC), 4.75%, 11/15/27     667,393    
  1,000     Cleveland Municipal School District, (FSA),
5.00%, 12/1/27
    1,035,780    
  2,075     Cuyahoga Community College District, (AMBAC),
5.00%, 12/1/32
    2,129,137    
  2,000     Elyria City School District, (XLCA), 5.00%, 12/1/35     2,062,560    
  580     Olentangy School District, (FSA), 4.50%, 12/1/32     568,655    
  500     Olmsted Falls City School, (XLCA), 5.00%, 12/1/35     517,620    
  720     Pickerington Local School District, (MBIA),
4.25%, 12/1/34
    671,054    
  2,400     Plain School District, (FGIC), 0.00%, 12/1/27     899,688    
  500     Tecumseh School District, (FGIC), 4.75%, 12/1/31     503,445    
  420     Trotwood-Madison City School District, (School
Improvements), (FSA), 4.50%, 12/1/30
    413,734    
  1,000     Zanesville School District, (School Improvements),
(MBIA), 5.05%, 12/1/29
    1,033,960    
            $ 12,870,881    
Insured-Hospital — 10.1%      
$ 1,000     Hamilton County, (Cincinnati Children's Hospital), (FGIC),
5.00%, 5/15/32
  $ 1,019,430    
  1,500     Hamilton County, (Cincinnati Children's Hospital),
(FGIC), 5.125%, 5/15/28
    1,550,115    
  1,250     Ohio Higher Educational Facility Commission, (University
Hospital Health Systems, Inc), (AMBAC), 4.75%, 1/15/46
    1,218,700    
            $ 3,788,245    
Insured-Lease Revenue / Certificates
of Participation — 14.6%
     
$ 1,000     Cleveland, (Cleveland Stadium), (AMBAC),
5.25%,11/15/27
  $ 1,021,510    
  795     Puerto Rico Public Buildings Authority, (CIFG),
5.25%, 7/1/36(1)
    837,312    
  2,205     Puerto Rico Public Buildings Authority, (CIFG),
Prerefunded to 7/1/12, 5.25%, 7/1/36(1)
    2,367,118    
  235     Puerto Rico Public Buildings Authority, Government
Facilities Revenue, (XLCA), 5.25%, 7/1/36
    247,495    
  1,000     Summit County, (Civic Theater Project), (AMBAC),
5.00%, 12/1/33
    1,021,300    
            $ 5,494,735    

 

See notes to financial statements
29



Eaton Vance Insured Ohio Municipal Bond Fund as of September 30, 2007

PORTFOLIO OF INVESTMENTS CONT'D

Principal Amount
(000's omitted)
 
Security
 
Value
 
Insured-Pooled Loans — 2.4%      
$ 850     Puerto Rico Municipal Finance Agency, (FSA),
5.00%, 8/1/27(1)
  $ 884,348    
            $ 884,348    
Insured-Public Education — 14.3%      
$ 3,000     Cincinnati Technical and Community College, (AMBAC),
5.00%, 10/1/28
  $ 3,090,120    
  1,170     Ohio University, (FSA), 5.25%, 12/1/23     1,247,278    
  1,000     University of Cincinnati, (AMBAC), 5.00%, 6/1/31     1,026,090    
            $ 5,363,488    
Insured-Sewer Revenue — 4.8%      
$ 1,100     Marysville Wastewater Treatment System, (XLCA),
4.75%, 12/1/46
  $ 1,081,663    
  750     Marysville Wastewater Treatment System, (XLCA),
4.75%, 12/1/47
    740,010    
            $ 1,821,673    
Insured-Special Tax Revenue — 18.3%      
$ 4,315     Hamilton County Sales Tax, (AMBAC), 0.00%, 12/1/22   $ 2,193,099    
  5,000     Hamilton County Sales Tax, (AMBAC), 0.00%, 12/1/23     2,411,250    
  1,000     Hamilton County Sales Tax, (AMBAC), 0.00%, 12/1/24     457,900    
  8,685     Puerto Rico Sales Tax Financing, (AMBAC), 0.00%, 8/1/54     855,299    
  1,480     Puerto Rico Sales Tax Financing, (MBIA), 0.00%, 8/1/44     244,289    
  2,935     Puerto Rico Sales Tax Financing, (MBIA), 0.00%, 8/1/45     460,824    
  1,845     Puerto Rico Sales Tax Financing, (MBIA), 0.00%, 8/1/46     275,219    
            $ 6,897,880    
Insured-Transportation — 11.1%      
$ 3,580     Cleveland Airport System, (FSA), 5.00%, 1/1/31   $ 3,628,581    
  500     Puerto Rico Highway and Transportation Authority, (CIFG),
5.25%, 7/1/41(1)
    553,650    
            $ 4,182,231    
Pooled Loans — 7.2%      
$ 1,500     Cuyahoga County Port Authority, (Garfield Heights),
5.25%, 5/15/23
  $ 1,500,420    
  1,140     Rickenbacker Port Authority, Oasbo Expanded Asset Pool
Loan, 5.375%, 1/1/32(1)
    1,213,754    
            $ 2,714,174    

 

Principal Amount
(000's omitted)
 
Security
 
Value
 
Private Education — 5.5%      
$ 850     Ohio Higher Educational Facilities Authority, (John Carroll
University), 5.25%, 11/15/33
  $ 862,843    
  180     Ohio Higher Educational Facilities Authority, (Oberlin
College), 5.00%, 10/1/29
    182,732    
  1,000     Ohio Higher Educational Facilities Authority, (Oberlin
College), 5.00%, 10/1/33
    1,025,380    
            $ 2,070,955    
Total Tax-Exempt Investments — 169.2%
(identified cost $61,432,951)
  $ 63,652,035    
Other Assets, Less Liabilities — (11.1)%   $ (4,160,118 )  
Auction Preferred Shares Plus Cumulative
Unpaid Dividends — (58.1)%
  $ (21,875,000 )  
Net Assets Applicable to
Common Shares — 100.0%
  $ 37,616,917    

 

AMBAC - AMBAC Financial Group, Inc.

CIFG - CIFG Assurance North America, Inc.

FGIC - Financial Guaranty Insurance Company

FSA - Financial Security Assurance, Inc.

MBIA - Municipal Bond Insurance Association

XLCA - XL Capital Assurance, Inc.

The Fund invests primarily in debt securities issued by Ohio municipalities. The ability of the issuers of the debt securities to meet their obligations may be affected by economic developments in a specific industry or municipality. In order to reduce the risk associated with such economic developments, at September 30, 2007, 87.4% of total investments are backed by bond insurance of various financial institutions and financial guaranty assurance agencies. The aggregate percentage insured by an individual financial institution ranged from 5.9% to 24.2% of total investments.

(1)  Security represents the underlying municipal obligation of an inverse floating rate obligation held by the Fund.

(2)  Security has been issued as an inverse floater bond. The stated interest rate represents the rate in effect at September 30, 2007.

(3)  Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be sold in transactions exempt from registration, normally to qualified institutional buyers. At September 30, 2007, the aggregate value of the securities is $557,075 or 1.5% of the Fund's net assets applicable to common shares.

(4)  Security (or a portion thereof) has been segregated to cover margin requirements on open financial futures contracts.

See notes to financial statements
30



Eaton Vance Insured Pennsylvania Municipal Bond Fund as of September 30, 2007

PORTFOLIO OF INVESTMENTS


Tax-Exempt Investments — 174.8%
     
Principal Amount
(000's omitted)
 
Security
 
Value
 
Escrowed / Prerefunded — 3.4%      
$ 750     Lancaster County Hospital Authority, Prerefunded to
9/15/13, 5.50%, 3/15/26
  $ 823,537    
  135     Puerto Rico Electric Power Authority, Prerefunded to
7/1/13, 5.125%, 7/1/29(1)
    146,015    
  515     Puerto Rico Electric Power Authority, Prerefunded to
7/1/13, 5.125%, 7/1/29(1)
    557,019    
            $ 1,526,571    
Hospital — 10.0%      
$ 1,000     Lancaster County Hospital Authority,
(Lancaster General Hospital), 4.50%, 3/15/36
  $ 925,790    
  350     Lebanon County Health Facility Authority,
(Good Samaritan Hospital), 6.00%, 11/15/35
    363,303    
  1,500     Lehigh County General Purpose Authority,
(Lehigh Valley Health Network), 5.25%, 7/1/32
    1,529,070    
  750     Pennsylvania Higher Educational Facilities Authority,
(UPMC Health System), 6.00%, 1/15/31
    800,992    
  930     Philadelphia Hospitals and Higher Education
Facilities Authority, (Children's Hospital), 4.50%, 7/1/37
    871,168    
            $ 4,490,323    
Insured-Electric Utilities — 8.2%      
$ 3,615     Lehigh County Industrial Development Authority,
(PPL Electric Utilities Corp.), (FGIC), 4.75%, 2/15/27
  $ 3,665,393    
            $ 3,665,393    
Insured-Escrowed / Prerefunded — 25.6%      
$ 1,000     Butler School District, (FSA), Prerefunded to
4/1/14, 5.00%, 4/1/31
  $ 1,077,880    
  2,500     Pennsylvania Higher Educational Facilities Authority,
(Temple University), (MBIA), Prerefunded to
4/1/08, 5.00%, 4/1/29(2)
    2,543,850    
  1,750     Pittsburgh Water and Sewer Authority, (AMBAC),
Prerefunded to 6/1/12, 5.125%, 12/1/27(1)
    1,863,547    
  1,200     Puerto Rico, (FGIC), Prerefunded to
7/1/12, 5.00%, 7/1/32(1)
    1,277,936    
  400     Puerto Rico Electric Power Authority, (FSA), Prerefunded to
7/1/10, Variable Rate, 7.43%, 7/1/29(3)(4)
    467,388    
  2,450     Puerto Rico Highway and Transportation Authority, (MBIA),
Prerefunded to 7/1/16, 5.00%, 7/1/36(1)
    2,677,189    
  270     Southcentral General Authority, (MBIA),
Escrowed to Maturity, 5.25%, 5/15/31
    283,962    
  1,230     Southcentral General Authority, (MBIA),
Prerefunded to 5/1/11, 5.25%, 5/15/31
    1,310,762    
            $ 11,502,514    

 

Principal Amount
(000's omitted)
 
Security
 
Value
 
Insured-General Obligations — 22.5%      
$ 1,000     Alleghany County Gateway School District, (FGIC),
5.00%, 10/15/32
  $ 1,025,660    
  1,650     Armstrong County, (MBIA), 5.40%, 6/1/31     1,726,510    
  500     Canon McMillan School District, (FGIC), 5.25%, 12/1/34     525,800    
  1,000     Erie School District, (AMBAC), 0.00%, 9/1/30     335,580    
  2,555     McKeesport School District, (MBIA), 0.00%, 10/1/21     1,371,677    
  1,750     Philadelphia, (FSA), 5.00%, 9/15/31(1)     1,778,671    
  500     Philadelphia, (FSA), 5.00%, 9/15/31     508,170    
  1,000     Pine-Richland School District, (FSA), 5.00%, 9/1/29     1,027,620    
  2,550     Shaler Area School District, (XLCA), 0.00%, 9/1/33     732,462    
  1,060     Upper Clair Township School District, (FSA),
5.00%, 7/15/32
    1,086,754    
            $ 10,118,904    
Insured-Hospital — 5.2%      
$ 1,325     Erie County Hospital Authority, (Hamot Health Foundation),
(CIFG), 4.75%, 11/1/32
  $ 1,308,676    
  1,000     Washington County Hospital Authority,
(Washington Hospital), (AMBAC), 5.125%, 7/1/28
    1,017,550    
            $ 2,326,226    
Insured-Lease Revenue / Certificates of
Participation — 6.9%
     
$ 1,300     Philadelphia Authority for Industrial Development
Lease Revenue, (FSA), 5.125%, 10/1/26
  $ 1,356,186    
  1,700     Philadelphia Authority for Industrial Development
Lease Revenue, (FSA), 5.25%, 10/1/30
    1,759,296    
            $ 3,115,482    
Insured-Private Education — 15.9%      
$ 1,000     Chester County Industrial Development Authority
Educational Facility, (Westtown School), (AMBAC),
5.00%, 1/1/31
  $ 1,025,730    
  475     Cumberland County Municipal Authority,
(Dickinson College), (MBIA), 4.50%, 5/1/37
    463,291    
  3,315     Delaware County, (Villanova University), (MBIA),
5.00%, 12/1/28
    3,385,278    
  1,900     Pennsylvania Higher Educational Facilities Authority,
(Temple University), (MBIA), 4.50%, 4/1/36
    1,847,921    
  440     Pennsylvania Higher Educational Facilities Authority,
(University of Pennsylvania), (MBIA), 4.50%, 6/15/36
    429,229    
            $ 7,151,449    

 

See notes to financial statements
31



Eaton Vance Insured Pennsylvania Municipal Bond Fund as of September 30, 2007

PORTFOLIO OF INVESTMENTS CONT'D

Principal Amount
(000's omitted)
 
Security
 
Value
 
Insured-Public Education — 7.9%      
$ 2,400     Lycoming County Authority, (Pennsylvania
College of Technology), (AMBAC), 5.25%, 5/1/32
  $ 2,514,360    
  1,000     Pennsylvania Higher Educational Facilities Authority,
(Clarion University Foundation), (XLCA), 5.00%, 7/1/33
    1,020,470    
            $ 3,534,830    
Insured-Sewer Revenue — 10.9%      
$ 1,000     Ambridge Borough Municipal Authority,
Sewer Revenue, (FSA), 4.60%, 10/15/41
  $ 976,760    
  1,555     Erie Sewer Authority, Series A, (AMBAC),
0.00%, 12/1/25
    673,160    
  2,155     Erie Sewer Authority, Series B, (AMBAC),
0.00%, 12/1/25
    932,900    
  1,920     Erie Sewer Authority, Series B, (AMBAC),
0.00%, 12/1/26
    787,834    
  1,500     Pennsylvania University Sewer Authority, (MBIA),
5.00%, 11/1/26
    1,550,895    
            $ 4,921,549    
Insured-Special Tax Revenue — 18.1%      
$ 4,350     Pittsburgh and Allegheny County Public Auditorium
Authority, (AMBAC), 5.00%, 2/1/29
  $ 4,462,013    
  25,410     Puerto Rico Sales Tax Financing, (AMBAC), 0.00%, 8/1/54     2,502,377    
  1,775     Puerto Rico Sales Tax Financing, (MBIA), 0.00%, 8/1/44     292,982    
  3,520     Puerto Rico Sales Tax Financing, (MBIA), 0.00%, 8/1/45     552,675    
  2,220     Puerto Rico Sales Tax Financing, (MBIA), 0.00%, 8/1/46     331,157    
            $ 8,141,204    
Insured-Transportation — 12.1%      
$ 2,000     Allegheny County Port Authority, (FGIC), 5.00%, 3/1/25   $ 2,067,600    
  1,000     Allegheny County Port Authority, (FGIC), 5.00%, 3/1/29     1,027,370    
  2,100     Puerto Rico Highway and Transportation Authority, (CIFG),
5.25%, 7/1/41(1)
    2,325,330    
            $ 5,420,300    
Insured-Utilities — 6.8%      
$ 3,000     Philadelphia Gas Works Revenue, (AMBAC),
5.00%, 10/1/37
  $ 3,079,620    
            $ 3,079,620    
Insured-Water and Sewer — 0.3%      
$ 150     Saxonburg Water and Sewer Authority, (AGC),
5.00%, 3/1/35
  $ 154,622    
            $ 154,622    

 

Principal Amount
(000's omitted)
 
Security
 
Value
 
Insured-Water Revenue — 10.0%      
$ 1,530     Philadelphia Water and Wastewater, (AMBAC),
4.25%, 11/1/31
  $ 1,421,079    
  3,000     Philadelphia Water and Wastewater, (FGIC),
5.00%, 11/1/31(1)
    3,079,100    
            $ 4,500,179    
Private Education — 6.7%      
$ 3,000     Pennsylvania Higher Educational Facilities Authority,
(University of Pennsylvania), 4.75%, 7/15/35
  $ 3,004,650    
            $ 3,004,650    
Senior Living / Life Care — 1.1%      
$ 200     Montgomery County Industrial Development Authority,
(Foulkeways at Gwynedd), 5.00%, 12/1/24
  $ 194,482    
  300     Montgomery County Industrial Development Authority,
(Foulkeways at Gwynedd), 5.00%, 12/1/30
    282,519    
            $ 477,001    
Transportation — 3.2%      
$ 1,400     Delaware River Joint Toll Bridge Commission,
5.00%, 7/1/28
  $ 1,429,008    
            $ 1,429,008    
Total Tax-Exempt Investments — 174.8%
(identified cost $76,240,994)
  $ 78,559,825    
Other Assets, Less Liabilities — (16.9)%   $ (7,597,346 )  
Auction Preferred Shares Plus Cumulative
Unpaid Dividends — (57.9)%
  $ (26,007,479 )  
Net Assets Applicable to
Common Shares — 100.0%
  $ 44,955,000    

 

AGC - Assured Guaranty Corp.

AMBAC - AMBAC Financial Group, Inc.

CIFG - CIFG Assurance North America, Inc.

FGIC - Financial Guaranty Insurance Company

FSA - Financial Security Assurance, Inc.

MBIA - Municipal Bond Insurance Association

XLCA - XL Capital Assurance, Inc.

See notes to financial statements
32



Eaton Vance Insured Pennsylvania Municipal Bond Fund as of September 30, 2007

PORTFOLIO OF INVESTMENTS CONT'D

The Fund invests primarily in debt securities issued by Pennsylvania municipalities. The ability of the issuers of the debt securities to meet their obligations may be affected by economic developments in a specific industry or municipality. In order to reduce the risk associated with such economic developments, at September 30, 2007, 86.1% of total investments are backed by bond insurance of various financial institutions and financial guaranty assurance agencies. The aggregate percentage insured by an individual financial institution ranged from 0.2% to 26.2% of total investments.

(1)  Security represents the underlying municipal obligation of an inverse floating rate obligation held by the Fund.

(2)  Security (or a portion thereof) has been segregated to cover margin requirements on open financial futures contracts.

(3)  Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be sold in transactions exempt from registration, normally to qualified institutional buyers. At September 30, 2007, the aggregate value of the securities is $467,388 or 1.0% of the Fund's net assets applicable to common shares.

(4)  Security has been issued as a leveraged inverse floater bond. The stated interest rate represents the rate in effect at September 30, 2007.

See notes to financial statements
33




Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FINANCIAL STATEMENTS

Statements of Assets and Liabilities

As of September 30, 2007

    Insured
Municipal Fund II
  Insured
California Fund II
  Insured
Florida Fund
 
Assets  
Investments —  
Identified cost   $ 269,747,238     $ 95,272,525     $ 62,308,094    
Unrealized appreciation     8,807,704       2,479,933       1,807,996    
Investments, at value   $ 278,554,942     $ 97,752,458     $ 64,116,090    
Cash   $ 188,070     $ 1,065,104     $ 22,744    
Receivable for investments sold           411,638          
Interest receivable     3,418,156       876,379       1,098,399    
Receivable for open interest rate swap contracts     55,259       30,457       17,712    
Total assets   $ 282,216,427     $ 100,136,036     $ 65,254,945    
Liabilities  
Payable for floating rate notes issued   $ 39,570,000     $ 7,550,000     $ 4,385,000    
Interest expense and fees payable     539,783       88,122       69,308    
Payable for investments purchased           407,588          
Payable for closed interest rate swap contracts     272,596       217,178       119,822    
Payable for open interest rate swap contracts     16,421       6,226       4,174    
Payable for when-issued securities     512,200                
Payable to affiliate for investment advisory fee     78,684       29,959       19,816    
Accrued expenses     96,616       63,486       57,090    
Total liabilities   $ 41,086,300     $ 8,362,559     $ 4,655,210    
Auction preferred shares at liquidation value plus cumulative unpaid dividends     87,517,980       33,763,685       22,513,870    
Net assets applicable to common shares   $ 153,612,147     $ 58,009,792     $ 38,085,865    
Sources of Net Assets  
Common shares, $0.01 par value, unlimited number of shares authorized   $ 99,270     $ 38,619     $ 25,755    
Additional paid-in capital     140,776,589       54,744,606       36,515,052    
Accumulated net realized gain (loss) (computed on the basis of identified cost)     3,788,292       662,955       (333,400 )  
Accumulated undistributed net investment income     40,482       40,236       47,293    
Net unrealized appreciation (computed on the basis of identified cost)     8,907,514       2,523,376       1,831,165    
Net assets applicable to common shares   $ 153,612,147     $ 58,009,792     $ 38,085,865    
Auction Preferred Shares Issued and Outstanding
(Liquidation preference of $25,000 per share)
 
      3,500       1,350       900    
Common Shares Outstanding  
      9,926,977       3,861,925       2,575,502    
Net Asset Value Per Common Share  
Net assets applicable to common shares ÷ common shares issued and outstanding   $ 15.47     $ 15.02     $ 14.79    

 

See notes to financial statements
34



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FINANCIAL STATEMENTS CONT'D

Statements of Assets and Liabilities

As of September 30, 2007

    Insured
Massachusetts Fund
  Insured
Michigan Fund
  Insured
New Jersey Fund
 
Assets  
Investments —  
Identified cost   $ 46,505,289     $ 40,054,949     $ 69,406,338    
Unrealized appreciation     1,811,239       1,808,147       2,828,760    
Investments, at value   $ 48,316,528     $ 41,863,096     $ 72,235,098    
Cash $1,077,557     $           $ 83,044    
Receivable for investments sold                 928,616    
Interest receivable     591,671       577,215       754,108    
Receivable for open interest rate swap contracts     14,200       6,307       20,717    
Total assets   $ 49,999,956     $ 42,446,618     $ 74,021,583    
Liabilities  
Payable for floating rate notes issued   $ 6,765,000     $ 5,780,000     $ 9,580,000    
Interest expense and fees payable     59,643       58,311       107,266    
Payable for closed interest rate swap contracts     103,347       40,440       149,778    
Payable for open interest rate swap contracts     2,874       2,463       4,174    
Payable for when-issued securities     1,022,380             1,333,800    
Due to custodian           91,245          
Payable to affiliate for investment advisory fee     13,713       11,909       20,486    
Accrued expenses     52,190       43,838       49,949    
Total liabilities   $ 8,019,147     $ 6,028,206     $ 11,245,453    
Auction preferred shares at liquidation value plus cumulative unpaid dividends     15,504,650       13,506,565       22,513,685    
Net assets applicable to common shares   $ 26,476,159     $ 22,911,847     $ 40,262,445    
Sources of Net Assets  
Common shares, $0.01 par value, unlimited number of shares authorized   $ 17,543     $ 15,118     $ 25,654    
Additional paid-in capital     24,859,217       21,413,714       36,365,886    
Accumulated net realized gain (loss) (computed on the basis of identified cost)     (249,351 )     (405,220 )     970,276    
Accumulated undistributed net investment income     19,274       72,841       43,808    
Net unrealized appreciation (computed on the basis of identified cost)     1,829,476       1,815,394       2,856,821    
Net assets applicable to common shares   $ 26,476,159     $ 22,911,847     $ 40,262,445    
Auction Preferred Shares Issued and Outstanding
(Liquidation preference of $25,000 per share)
 
      620       540       900    
Common Shares Outstanding  
      1,754,310       1,511,845       2,565,367    
Net Asset Value Per Common Share  
Net assets applicable to common shares ÷ common shares issued and outstanding   $ 15.09     $ 15.15     $ 15.69    

 

See notes to financial statements
35



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FINANCIAL STATEMENTS CONT'D

Statements of Assets and Liabilities

As of September 30, 2007

    Insured
New York Fund II
  Insured
Ohio Fund
  Insured
Pennsylvania Fund
 
Assets  
Investments —  
Identified cost   $ 63,766,544     $ 61,432,951     $ 76,240,994    
Unrealized appreciation     1,847,438       2,219,084       2,318,831    
Investments, at value   $ 65,613,982     $ 63,652,035     $ 78,559,825    
Cash   $ 52,660     $ 145,256     $ 45,022    
Receivable for investments sold     3,068,297             1,465,920    
Interest receivable     774,892       776,287       983,952    
Receivable for open interest rate swap contracts     18,068       12,446       62,021    
Total assets   $ 69,527,899     $ 64,586,024     $ 81,116,740    
Liabilities  
Payable for floating rate notes issued   $ 4,665,000     $ 4,905,000     $ 8,495,000    
Interest expense and fees payable     58,087       48,019       93,841    
Payable for investments purchased     3,151,909             1,487,400    
Payable for closed interest rate swap contracts     119,822       65,902          
Payable for open interest rate swap contracts     4,174       4,037       3,968    
Payable to affiliate for investment advisory fee     20,051       19,444       23,191    
Accrued expenses     52,066       51,705       50,861    
Total liabilities   $ 8,071,109     $ 5,094,107     $ 10,154,261    
Auction preferred shares at liquidation value plus cumulative unpaid dividends     22,509,861       21,875,000       26,007,479    
Net assets applicable to common shares   $ 38,946,929     $ 37,616,917     $ 44,955,000    
Sources of Net Assets  
Common shares, $0.01 par value, unlimited number of shares authorized   $ 25,553     $ 25,129     $ 29,432    
Additional paid-in capital     36,207,552       35,613,604       41,716,097    
Accumulated net realized gain (loss) (computed on the basis of identified cost)     518,661       (295,235 )     781,327    
Accumulated undistributed net investment income     323,815       13,950       60,972    
Net unrealized appreciation (computed on the basis of identified cost)     1,871,348       2,259,469       2,367,172    
Net assets applicable to common shares   $ 38,946,929     $ 37,616,917     $ 44,955,000    
Auction Preferred Shares Issued and Outstanding
(Liquidation preference of $25,000 per share)
 
      900       875       1,040    
Common Shares Outstanding  
      2,555,287       2,512,913       2,943,172    
Net Asset Value Per Common Share  
Net assets applicable to common shares ÷ common shares issued and outstanding   $ 15.24     $ 14.97     $ 15.27    

 

See notes to financial statements
36



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FINANCIAL STATEMENTS CONT'D

Statements of Operations

For the Year Ended September 30, 2007

    Insured
Municipal Fund II
  Insured
California Fund II
  Insured
Florida Fund
 
Investment Income  
Interest   $ 13,506,710     $ 4,722,831     $ 3,152,999    
Total investment income   $ 13,506,710     $ 4,722,831     $ 3,152,999    
Expenses  
Investment adviser fee   $ 1,344,894     $ 509,888     $ 337,595    
Trustees' fees and expenses     12,340       7,170       1,845    
Legal and accounting services     53,652       44,365       40,266    
Printing and postage     34,559       13,771       11,595    
Custodian fee     131,352       55,564       40,628    
Interest expense and fees     1,556,554       294,793       184,872    
Transfer and dividend disbursing agent fees     107,742       46,049       33,650    
Preferred shares remarketing agent fee     218,750       84,375       56,250    
Miscellaneous     40,885       38,111       28,494    
Total expenses   $ 3,500,728     $ 1,094,086     $ 735,195    
Deduct —  
Reduction of custodian fee   $ 19,108     $ 14,528     $ 5,200    
Allocation of expenses to the investment adviser     6,321       5,103       3,815    
Reduction of investment adviser fee     366,789       139,060       92,071    
Total expense reductions   $ 392,218     $ 158,691     $ 101,086    
Net expenses   $ 3,108,510     $ 935,395     $ 634,109    
Net investment income   $ 10,398,200     $ 3,787,436     $ 2,518,890    
Realized and Unrealized Gain (Loss)  
Net realized gain (loss) —  
Investment transactions (identified cost basis)   $ 4,442,353     $ 1,694,010     $ 351,714    
Financial futures contracts     (1,121,972 )     (78,190 )     (126,022 )  
Interest rate swap contracts     (52,205 )     (137,771 )     (67,190 )  
Disposal of investments in violation of restrictions and net increase from payments by affiliates     0                
Net realized gain   $ 3,268,176     $ 1,478,049     $ 158,502    
Change in unrealized appreciation (depreciation) —  
Investments (identified cost basis)   $ (8,383,421 )   $ (2,931,302 )   $ (1,474,521 )  
Financial futures contracts     1,277,266       276,490       232,116    
Interest rate swap contracts     38,838       24,231       13,538    
Net change in unrealized appreciation (depreciation)   $ (7,067,317 )   $ (2,630,581 )   $ (1,228,867 )  
Net realized and unrealized loss   $ (3,799,141 )   $ (1,152,532 )   $ (1,070,365 )  
Distributions to preferred shareholders  
From net investment income   $ (3,009,366 )   $ (1,088,414 )   $ (797,008 )  
Net increase in net assets from operations   $ 3,589,693     $ 1,546,490     $ 651,517    

 

See notes to financial statements
37



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FINANCIAL STATEMENTS CONT'D

Statements of Operations

For the Year Ended September 30, 2007

    Insured
Massachusetts Fund
  Insured
Michigan Fund
  Insured
New Jersey Fund
 
Investment Income  
Interest   $ 2,302,154     $ 2,010,016     $ 3,381,555    
Total investment income   $ 2,302,154     $ 2,010,016     $ 3,381,555    
Expenses  
Investment adviser fee   $ 234,186     $ 201,629     $ 346,998    
Trustees' fees and expenses     1,845       185       1,846    
Legal and accounting services     40,852       34,443       38,787    
Printing and postage     8,508       10,511       12,306    
Custodian fee     33,597       28,168       40,237    
Interest expense and fees     264,144       226,730       374,017    
Transfer and dividend disbursing agent fees     26,526       20,502       33,802    
Preferred shares remarketing agent fee     38,750       33,750       56,250    
Miscellaneous     27,252       27,859       29,937    
Total expenses   $ 675,660     $ 583,777     $ 934,180    
Deduct —  
Reduction of custodian fee   $ 4,003     $ 4,996     $ 10,087    
Allocation of expenses to the investment adviser     4,650       3,433       3,815    
Reduction of investment adviser fee     63,869       54,990       93,945    
Total expense reductions   $ 72,522     $ 63,419     $ 107,847    
Net expenses   $ 603,138     $ 520,358     $ 826,333    
Net investment income   $ 1,699,016     $ 1,489,658     $ 2,555,222    
Realized and Unrealized Gain (Loss)  
Net realized gain (loss) —  
Investment transactions (identified cost basis)   $ 234,237     $ 227,128     $ 1,367,245    
Financial futures contracts     (66,255 )     (60,516 )     (106,308 )  
Interest rate swap contracts     (65,786 )     (12,476 )     (94,548 )  
Disposal of investments in violation of restrictions and net increase from payments by affiliate     20,473                
Net realized gain   $ 122,669     $ 154,136     $ 1,166,389    
Change in unrealized appreciation (depreciation) —  
Investments (identified cost basis)   $ (1,231,521 )   $ (714,030 )   $ (1,806,208 )  
Financial futures contracts     155,469       88,756       240,068    
Interest rate swap contracts     11,326       3,844       16,543    
Net change in unrealized appreciation (depreciation)   $ (1,064,726 )   $ (621,430 )   $ (1,549,597 )  
Net realized and unrealized loss   $ (942,057 )   $ (467,294 )   $ (383,208 )  
Distributions to preferred shareholders  
From net investment income   $ (514,151 )   $ (435,251 )   $ (732,552 )  
Net increase in net assets from operations   $ 242,808     $ 587,113     $ 1,439,462    

 

See notes to financial statements
38



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FINANCIAL STATEMENTS CONT'D

Statements of Operations

For the Year Ended September 30, 2007

    Insured
New York Fund II
  Insured
Ohio Fund
  Insured
Pennsylvania Fund
 
Investment Income  
Interest   $ 3,110,199     $ 3,067,652     $ 3,818,683    
Total investment income   $ 3,110,199     $ 3,067,652     $ 3,818,683    
Expenses  
Investment adviser fee   $ 342,008     $ 331,168     $ 392,766    
Trustees' fees and expenses     1,777       1,846       1,859    
Legal and accounting services     38,216       38,708       44,102    
Printing and postage     10,941       13,449       14,673    
Custodian fee     42,414       38,760       47,978    
Interest expense and fees     182,374       203,812       378,794    
Transfer and dividend disbursing agent fees     35,362       31,642       36,139    
Preferred shares remarketing agent fee     56,250       54,688       65,000    
Miscellaneous     30,478       29,239       31,320    
Total expenses   $ 739,820     $ 743,312     $ 1,012,631    
Deduct —  
Reduction of custodian fee   $ 9,366     $ 9,792     $ 11,011    
Allocation of expenses to the investment adviser     3,348       3,832       6,263    
Reduction of investment adviser fee     93,275       90,319       106,335    
Total expense reductions   $ 105,989     $ 103,943     $ 123,609    
Net expenses   $ 633,831     $ 639,369     $ 889,022    
Net investment income   $ 2,476,368     $ 2,428,283     $ 2,929,661    
Realized and Unrealized Gain (Loss)  
Net realized gain (loss) —  
Investment transactions (identified cost basis)   $ 509,673     $ 449,639     $ 809,518    
Financial futures contracts     (130,379 )     (247,801 )     198,122    
Interest rate swap contracts     (65,731 )     (14,069 )     (297,251 )  
Net realized gain   $ 313,563     $ 187,769     $ 710,389    
Change in unrealized appreciation (depreciation) —  
Investments (identified cost basis)   $ (1,212,101 )   $ (1,462,550 )   $ (1,813,359 )  
Financial futures contracts     237,337       347,054       (42,312 )  
Interest rate swap contracts     13,894       8,409       556,711    
Net change in unrealized appreciation (depreciation)   $ (960,870 )   $ (1,107,087 )   $ (1,298,960 )  
Net realized and unrealized loss   $ (647,307 )   $ (919,318 )   $ (588,571 )  
Distributions to preferred shareholders  
From net investment income   $ (534,850 )   $ (756,723 )   $ (856,964 )  
From net realized gain     (200,979 )              
Net increase in net assets from operations   $ 1,093,232     $ 752,242     $ 1,484,126    

 

See notes to financial statements
39



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FINANCIAL STATEMENTS CONT'D

Statements of Changes in Net Assets

For the Year Ended September 30, 2007

Increase (Decrease) in Net Assets   Insured
Municipal Fund II
  Insured
California Fund II
  Insured
Florida Fund
 
From operations —  
Net investment income   $ 10,398,200     $ 3,787,436     $ 2,518,890    
Net realized gain from investment transactions, financial futures contracts, interest rate swap contracts,
and disposal of investments in violation of restrictions and net increase from  
payments by affiliates
    3,268,176       1,478,049       158,502    
Net change in unrealized appreciation (depreciation) from investments,
financial futures contracts and interest rate swap contracts
    (7,067,317 )     (2,630,581 )     (1,228,867 )  
Distributions to preferred shareholders —  
From net investment income     (3,009,366 )     (1,088,414 )     (797,008 )  
Net increase in net assets from operations   $ 3,589,693     $ 1,546,490     $ 651,517    
Distributions to common shareholders —  
From net investment income   $ (7,466,114 )   $ (2,736,166 )   $ (1,694,472 )  
Total distributions to common shareholders   $ (7,466,114 )   $ (2,736,166 )   $ (1,694,472 )  
Capital share transactions  
Reinvestment of distributions to common shareholders   $ 25,683     $     $    
Net increase in net assets from capital share transactions   $ 25,683     $     $    
Net decrease in net assets   $ (3,850,738 )   $ (1,189,676 )   $ (1,042,955 )  
Net Assets Applicable to Common Shares  
At beginning of year   $ 157,462,885     $ 59,199,468     $ 39,128,820    
At end of year   $ 153,612,147     $ 58,009,792     $ 38,085,865    
Undistributed net investment income included
in net assets applicable to common shares
 
At end of year   $ 40,482     $ 40,236     $ 47,293    

 

See notes to financial statements
40



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FINANCIAL STATEMENTS CONT'D

Statements of Changes in Net Assets

For the Year Ended September 30, 2007

Increase (Decrease) in Net Assets   Insured
Massachusetts Fund
  Insured
Michigan Fund
  Insured
New Jersey Fund
 
From operations —  
Net investment income   $ 1,699,016     $ 1,489,658     $ 2,555,222    
Net realized gain from investment transactions, financial futures contracts, interest rate swap contracts,
and disposal of investments in violation of restrictions and net increase from payments by affiliates
    122,669       154,136       1,166,389    
Net change in unrealized appreciation (depreciation) from investments,
financial futures contracts and interest rate swap contracts
    (1,064,726 )     (621,430 )     (1,549,597 )  
Distributions to preferred shareholders —  
From net investment income     (514,151 )     (435,251 )     (732,552 )  
Net increase in net assets from operations   $ 242,808     $ 587,113     $ 1,439,462    
Distributions to common shareholders —  
From net investment income   $ (1,203,685 )   $ (1,009,900 )   $ (1,820,869 )  
Total distributions to common shareholders   $ (1,203,685 )   $ (1,009,900 )   $ (1,820,869 )  
Capital share transactions  
Reinvestment of distributions to common shareholders   $ 17,788     $     $ 24,197    
Net increase in net assets from capital share transactions   $ 17,788     $     $ 24,197    
Net decrease in net assets   $ (943,089 )   $ (422,787 )   $ (357,210 )  
Net Assets Applicable to Common Shares  
At beginning of year   $ 27,419,248     $ 23,334,634     $ 40,619,655    
At end of year   $ 26,476,159     $ 22,911,847     $ 40,262,445    
Undistributed net investment income included
in net assets applicable to common shares
 
At end of year   $ 19,274     $ 72,841     $ 43,808    

 

See notes to financial statements
41



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FINANCIAL STATEMENTS CONT'D

Statements of Changes in Net Assets

For the Year Ended September 30, 2007

Increase (Decrease) in Net Assets   Insured
New York Fund II
  Insured
Ohio Fund
  Insured
Pennsylvania Fund
 
From operations —  
Net investment income   $ 2,476,368     $ 2,428,283     $ 2,929,661    
Net realized gain from investment transactions, financial futures contracts and interest rate swap contracts     313,563       187,769       710,389    
Net change in unrealized appreciation (depreciation) from investments, financial futures
contracts and interest rate swap contracts
    (960,870 )     (1,107,087 )     (1,298,960 )  
Distributions to preferred shareholders —  
From net investment income     (534,850 )     (756,723 )     (856,964 )  
From net realized gain     (200,979 )              
Net increase in net assets from operations   $ 1,093,232     $ 752,242     $ 1,484,126    
Distributions to common shareholders —  
From net investment income   $ (1,780,878 )   $ (1,669,755 )   $ (2,045,499 )  
From net realized gain     (634,133 )              
Total distributions to common shareholders   $ (2,415,011 )   $ (1,669,755 )   $ (2,045,499 )  
Capital share transactions  
Reinvestment of distributions to common shareholders   $ 5,574     $ 2,860     $    
Net increase in net assets from capital share transactions   $ 5,574     $ 2,860     $    
Net decrease in net assets   $ (1,316,205 )   $ (914,653 )   $ (561,373 )  
Net Assets Applicable to Common Shares  
At beginning of year   $ 40,263,134     $ 38,531,570     $ 45,516,373    
At end of year   $ 38,946,929     $ 37,616,917     $ 44,955,000    
Undistributed net investment income included
in net assets applicable to common shares
 
At end of year   $ 323,815     $ 13,950     $ 60,972    

 

See notes to financial statements
42



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FINANCIAL STATEMENTS CONT'D

Statements of Changes in Net Assets

For the Year Ended September 30, 2006

Increase (Decrease) in Net Assets   Insured
Municipal Fund II
  Insured
California Fund II
  Insured
Florida Fund
 
From operations —  
Net investment income   $ 10,500,454     $ 3,818,662     $ 2,527,070    
Net realized gain from investment transactions and financial futures contracts     4,356,455       1,273,316       1,052,884    
Net change in unrealized appreciation (depreciation) from investments and
financial futures contracts
    1,649,905       834,431       (147,834 )  
Distributions to preferred shareholders —
From net investment income
    (2,631,920 )     (937,884 )     (684,139 )  
Net increase in net assets from operations   $ 13,874,894     $ 4,988,525     $ 2,747,981    
Distributions to common shareholders —  
From net investment income   $ (8,416,039 )   $ (2,983,698 )   $ (1,912,090 )  
Total distributions to common shareholders   $ (8,416,039 )   $ (2,983,698 )   $ (1,912,090 )  
Capital share transactions  
Reinvestment of distributions to common shareholders   $ 67,445     $ 7,738     $ 24,117    
Net increase in net assets from capital share transactions   $ 67,445     $ 7,738     $ 24,117    
Net increase in net assets   $ 5,526,300     $ 2,012,565     $ 860,008    
Net Assets Applicable to Common Shares  
At beginning of year   $ 151,936,585     $ 57,186,903     $ 38,268,812    
At end of year   $ 157,462,885     $ 59,199,468     $ 39,128,820    
Undistributed net investment income included
in net assets applicable to common shares
 
At end of year   $ 184,615     $ 94,976     $ 29,450    

 

See notes to financial statements
43



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FINANCIAL STATEMENTS CONT'D

Statements of Changes in Net Assets

For the Year Ended September 30, 2006

Increase (Decrease) in Net Assets   Insured
Massachusetts Fund
  Insured
Michigan Fund
  Insured
New Jersey Fund
 
From operations —  
Net investment income   $ 1,722,682     $ 1,498,369     $ 2,567,366    
Net realized gain from investment transactions and financial futures contracts     888,468       630,423       1,305,317    
Net change in unrealized appreciation (depreciation) from investments and
financial futures contracts
    178,464       73,846       418,939    
Distributions to preferred shareholders —  
From net investment income     (447,955 )     (381,488 )     (648,584 )  
Net increase in net assets from operations   $ 2,341,659     $ 1,821,150     $ 3,643,038    
Distributions to common shareholders —  
From net investment income   $ (1,400,956 )   $ (1,166,029 )   $ (2,101,233 )  
Total distributions to common shareholders   $ (1,400,956 )   $ (1,166,029 )   $ (2,101,233 )  
Capital share transactions  
Reinvestment of distributions to common shareholders   $ 37,096     $ 9,334     $ 45,513    
Net increase in net assets from capital share transactions   $ 37,096     $ 9,334     $ 45,513    
Net increase in net assets   $ 977,799     $ 664,455     $ 1,587,318    
Net Assets Applicable to Common Shares  
At beginning of year   $ 26,441,449     $ 22,670,179     $ 39,032,337    
At end of year   $ 27,419,248     $ 23,334,634     $ 40,619,655    
Undistributed net investment income included
in net assets applicable to common shares
 
At end of year   $ 44,610     $ 33,700     $ 60,235    

 

See notes to financial statements
44



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FINANCIAL STATEMENTS CONT'D

Statements of Changes in Net Assets

For the Year Ended September 30, 2006

Increase (Decrease) in Net Assets   Insured
New York Fund II
  Insured
Ohio Fund
  Insured
Pennsylvania Fund
 
From operations —  
Net investment income   $ 2,529,875     $ 2,456,473     $ 2,925,034    
Net realized gain from investment transactions, financial futures contracts and interest rate swap contracts     1,820,664       1,437,276       1,906,794    
Net change in unrealized appreciation (depreciation) from investments and financial
futures contracts
    (449,834 )     (166,968 )     (266,841 )  
Distributions to preferred shareholders —  
From net investment income     (612,672 )     (660,891 )     (783,269 )  
From net realized gain     (37,328 )              
Net increase in net assets from operations   $ 3,250,705     $ 3,065,890     $ 3,781,718    
Distributions to common shareholders —  
From net investment income   $ (1,870,200 )   $ (1,789,062 )   $ (2,199,819 )  
From net realized gain     (217,935 )              
Total distributions to common shareholders   $ (2,088,135 )   $ (1,789,062 )   $ (2,199,819 )  
Capital share transactions  
Reinvestment of distributions to common shareholders   $     $     $ 14,661    
Net increase in net assets from capital share transactions   $     $     $ 14,661    
Net increase in net assets   $ 1,162,570     $ 1,276,828     $ 1,596,560    
Net Assets Applicable to Common Shares  
At beginning of year   $ 39,100,564     $ 37,254,742     $ 43,919,813    
At end of year   $ 40,263,134     $ 38,531,570     $ 45,516,373    
Undistributed net investment income included
in net assets applicable to common shares
 
At end of year   $ 161,206     $ 32,884     $ 42,786    

 

See notes to financial statements
45



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FINANCIAL STATEMENTS CONT'D

Statements of Cash Flows

For the Year Ended September 30, 2007

Cash flows from operating activities   Insured
Municipal Fund II
  Insured
Massachusetts Fund
  Insured
Michigan Fund
 
Net increase in net assets from operations   $ 3,589,693     $ 242,808     $ 587,113    
Distributions to preferred shareholders     3,009,366       514,151       435,251    
Net increase in net assets from operations excluding distributions to
preferred shareholders from net investment income
  $ 6,599,059     $ 756,959     $ 1,022,364    
Adjustments to reconcile net increase in net assets from
operations to net cash provided by (used in) operating activities:
 
Investments purchased     (86,860,586 )     (7,321,506 )     (2,459,789 )  
Investments sold     90,818,853       10,959,195       2,652,162    
Net amortization of premium (discount)     (1,734,021 )     (103,639 )     (225,412 )  
Decrease (increase) in interest receivable     95,672       8,473       (11,553 )  
Decrease in receivable for investments sold     331,573                
Increase in receivable for open interest rate swap contracts     (55,259 )     (14,200 )     (6,307 )  
Decrease in receivable from the transfer agent           2,971          
Increase in payable for closed interest rate swap contracts     272,596       103,347       40,440    
Increase in payable for open interest rate swap contracts     16,421       2,874       2,463    
Decrease in payable to affiliate for investment advisory fee     (1,648 )     (347 )     (166 )  
Increase (decrease) in payable for when-issued securities     (3,075,207 )     1,022,380          
Increase (decrease) in accrued expenses     (4,459 )     3,733       1,163    
Increase (decrease) in interest expense and fees payable     36,792       (23,931 )     3,047    
Net change in unrealized (appreciation) depreciation on investments     8,383,421       1,231,521       714,030    
Net realized (gain) loss on investments     (4,442,353 )     (254,710 )     (227,128 )  
Net cash provided by operating activities   $ 10,380,854     $ 6,373,120     $ 1,505,314    
Cash flows from financing activities  
Cash distributions paid to common shareholders net of reinvestments   $ (7,440,431 )   $ (1,185,897 )   $ (1,009,900 )  
Decrease in payable to affiliate for inverse floaters           (1,586,200 )        
Repayment of secured borrowings           (2,000,000 )        
Distributions to preferred shareholders from net investment income     (2,999,955 )     (512,473 )     (433,715 )  
Decrease in due to custodian           (10,993 )     (61,699 )  
Net cash used in financing activities   $ (10,440,386 )   $ (5,295,563 )   $ (1,505,314 )  
Net increase (decrease) in cash   $ (59,532 )   $ 1,077,557     $    
Cash at beginning of year   $ 247,602     $     $    
Cash at end of year   $ 188,070     $ 1,077,557     $    
Supplemental disclosure of cash flow information:  
Noncash financing activities not included herein consist of reinvestment of dividends and distributions of:   $ 25,683     $ 17,788     $    

 

See notes to financial statements
46



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FINANCIAL STATEMENTS CONT'D

Statements of Cash Flows

For the Year Ended September 30, 2007

Cash flows from operating activities   Insured
New Jersey Fund
  Insured
Pennsylvania Fund
 
Net increase in net assets from operations   $ 1,439,462     $ 1,484,126    
Distributions to preferred shareholders     732,552       856,964    
Net increase in net assets from operations excluding distributions to
preferred shareholders from net investment income
  $ 2,172,014     $ 2,341,090    
Adjustments to reconcile net increase in net assets from
operations to net cash provided by (used in) operating activities:
 
Investments purchased     (19,495,030 )     (19,463,578 )  
Investments sold     19,343,532       21,490,909    
Net amortization of premium (discount)     (448,069 )     (279,283 )  
Increase in interest receivable     (42,223 )     (54,574 )  
Increase in payable for investments purchased           1,487,400    
Increase in receivable for investments sold     (928,616 )     (1,465,920 )  
Increase in receivable for open interest rate swap contracts     (20,717 )     (62,021 )  
Decrease in receivable from the transfer agent     5,140          
Decrease in payable for open interest rate swaps contracts     4,174       (494,690 )  
Increase (decrease) in payable for closed interest rate swap contracts     149,778       (107,000 )  
Decrease in payable to affiliate for investment advisory fees     (148 )     (232 )  
Decrease in payable to affiliate for Trustees' fees           (67 )  
Increase in payable for when-issued securities     1,333,800          
Increase in accrued expenses     3,996       6,612    
Increase (decrease) in interest expense and fees payable     21,662       (10,722 )  
Net change in unrealized (appreciation) depreciation on investments     1,806,208       1,813,359    
Net realized (gain) loss on investments     (1,367,245 )     (809,518 )  
Net cash provided by operating activities   $ 2,538,256     $ 4,391,765    
Cash flows from financing activities  
Cash distributions paid to common shareholders net of reinvestments   $ (1,796,672 )   $ (2,045,499 )  
Distributions to preferred shareholders from net investment income     (728,496 )     (854,058 )  
Repayment of secured borrowings           (1,900,000 )  
Net cash used in financing activities   $ (2,525,168 )   $ (4,799,557 )  
Net increase (decrease) in cash   $ 13,088     $ (407,792 )  
Cash at beginning of year   $ 69,956     $ 452,814    
Cash at end of year   $ 83,044     $ 45,022    
Supplemental disclosure of cash flow information:  
Noncash financing activities not included herein consist of reinvestment of dividends and distributions of:   $ 24,197     $    

 

See notes to financial statements
47




Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FINANCIAL STATEMENTS CONT'D

Financial Highlights

Selected data for a common share outstanding during the periods stated

    Insured Municipal Fund II  
    Year Ended September 30,  
    2007(1)    2006(1)    2005(1)    2004(1)    2003(1)(2)   
Net asset value — Beginning of year (Common shares)   $ 15.860     $ 15.310     $ 15.030     $ 14.790     $ 14.325 (3)   
Income (loss) from operations  
Net investment income   $ 1.048     $ 1.058     $ 1.094     $ 1.162     $ 0.879    
Net realized and unrealized gain (loss)     (0.383 )     0.605       0.359       0.334       0.508    
Distributions to preferred shareholders  
From net investment income     (0.303 )     (0.265 )     (0.169 )     (0.080 )     (0.071 )  
From net realized gain                 0.000 (5)      (0.017 )        
Total income from operations   $ 0.362     $ 1.398     $ 1.284     $ 1.399     $ 1.316    
Less distributions to common shareholders  
From net investment income   $ (0.752 )   $ (0.848 )   $ (1.001 )   $ (1.001 )   $ (0.714 )  
From net realized gain                 (0.003 )     (0.158 )        
Total distributions to common shareholders   $ (0.752 )   $ (0.848 )   $ (1.004 )   $ (1.159 )   $ (0.714 )  
Preferred and Common shares offering costs
charged to paid-in capital
  $     $     $     $     $ (0.048 )  
Preferred shares underwriting discounts   $     $     $     $     $ (0.089 )  
Net asset value — End of year (Common shares)   $ 15.470     $ 15.860     $ 15.310     $ 15.030     $ 14.790    
Market value — End of year (Common shares)   $ 14.550     $ 15.310     $ 16.170     $ 14.820     $ 14.000    
Total Investment Return on Net Asset Value(6)      2.43 %(4)      9.56 %     8.77 %     10.00 %     8.46 %(7)   
Total Investment Return on Market Value(6)      (0.20 )%(4)      0.13 %     16.51 %     14.59 %     2.67 %(7)   

 

See notes to financial statements
48



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FINANCIAL STATEMENTS CONT'D

Financial Highlights

Selected data for a common share outstanding during the periods stated

    Insured Municipal Fund II  
    Year Ended September 30,  
    2007(1)    2006(1)    2005(1)    2004(1)    2003(1)(2)   
Ratios/Supplemental Data  
Net assets applicable to common shares, end of year (000's omitted)   $ 153,612     $ 157,463     $ 151,937     $ 149,057     $ 146,574    
Ratios (As a percentage of average net assets applicable to common shares):(8)  
Expenses excluding interest and fees     1.00 %(10)     1.02 %     1.03 %     1.00 %     0.86 %(11)  
Interest and fee expense(9)     0.99 %     0.91 %     0.62 %     0.36 %     0.26 %(11)  
Total expenses before custodian fee reduction     1.99 %(10)     1.93 %     1.65 %     1.36 %     1.12 %(11)  
Expenses after custodian fee reduction excluding interest and fees     0.99 %(10)     1.01 %     1.02 %     1.00 %     0.84 %(11)  
Net investment income     6.62 %     6.87 %     7.11 %     7.92 %     7.14 %(11)  
Portfolio Turnover     31 %     26 %     10 %     28 %     32 %  

 

The ratios reported above are based on net assets applicable solely to common shares. The ratios based on net assets, including amounts related to preferred shares, are as follows:

Ratios (As a percentage of average total net assets applicable to common shares and preferred shares):(8)  
Expenses excluding interest and fees     0.64 %(10)     0.65 %     0.65 %     0.63 %     0.57 %(11)  
Interest and fee expense(9)     0.64 %     0.58 %     0.40 %     0.23 %     0.17 %(11)  
Total expenses before custodian fee reduction     1.28 %(10)     1.23 %     1.05 %     0.86 %     0.74 %(11)  
Expenses after custodian fee reduction excluding interest and fees     0.63 %(10)     0.64 %     0.65 %     0.62 %     0.56 %(11)  
Net investment income     4.25 %     4.37 %     4.52 %     4.94 %     4.72 %(11)  
Senior Securities:  
Total preferred shares outstanding     3,500       3,500       3,500       3,500       3,500    
Asset coverage per preferred share(12)   $ 68,894     $ 69,992     $ 68,411     $ 67,599     $ 66,893    
Involuntary liquidation preference per preferred share(13)   $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000    
Approximate market value per preferred share(13)   $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000    

 

(1)  Per share net investment income was computed using average common shares outstanding.

(2)  For the period from the start of business, November 29, 2002, to September 30, 2003.

(3)  Net asset value at beginning of period reflects the deduction of the sales load of $0.675 per share paid by the shareholder from the $15.000 offering price.

(4)  During the year ended September 30, 2007, the adviser fully reimbursed the Fund for a realized loss on the disposal of an investment security which did not meet investment guidelines. The loss had no effect on total return.

(5)  Equal to less than $0.001 per share.

(6)  Returns are historical and are calculated by determining the percentage change in net asset value or market value with all distributions reinvested.

(7)  Total investment return on net asset value is calculated assuming a purchase at the offering price of $15.000 less the sales load of $0.675 per share paid by the shareholder on the first day and a sale at the net asset value on the last day of the period reported. Total investment return on market value is calculated assuming a purchase at the offering price of $15.000 less the sales load of $0.675 per share paid by the shareholder on the first day and a sale at the current market price on the last day of the period reported. Total investment return on net asset value and total investment return on market value are not computed on an annualized basis.

(8)  Ratios do not reflect the effect of dividend payments to preferred shareholders.

(9)  Interest and fee expense relates to the liability for floating rate notes issued in conjunction with inverse floater securities transactions (see Note 1H).

(10)  The investment adviser was allocated a portion of the Fund's operating expenses (equal to less than 0.005% of average daily net assets for the year ended September 30, 2007). Absent this allocation, total return would be lower.

(11)  Annualized.

(12)  Calculated by subtracting the Fund's total liabilities (not including the preferred shares) from the Fund's total assets, and dividing this by the number of preferred shares outstanding.

(13)  Plus accumulated and unpaid dividends.

See notes to financial statements
49



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FINANCIAL STATEMENTS CONT'D

Financial Highlights

Selected data for a common share outstanding during the periods stated

    Insured California Fund II  
    Year Ended September 30,  
    2007(1)    2006(1)    2005(1)    2004(1)    2003(1)(2)   
Net asset value — Beginning of year (Common shares)   $ 15.330     $ 14.810     $ 14.510     $ 14.560     $ 14.325 (3)   
Income (loss) from operations  
Net investment income   $ 0.981     $ 0.989     $ 1.008     $ 1.060     $ 0.822    
Net realized and unrealized gain (loss)     (0.301 )     0.547       0.360       (0.022 )     0.281    
Distributions to preferred shareholders  
From net investment income     (0.282 )     (0.243 )     (0.145 )     (0.076 )     (0.050 )  
From net realized gain                       (0.004 )        
Total income from operations   $ 0.398     $ 1.293     $ 1.223     $ 0.958     $ 1.053    
Less distributions to common shareholders  
From net investment income   $ (0.708 )   $ (0.773 )   $ (0.923 )   $ (0.948 )   $ (0.675 )  
From net realized gain                       (0.060 )        
Total distributions to common shareholders   $ (0.708 )   $ (0.773 )   $ (0.923 )   $ (1.008 )   $ (0.675 )  
Preferred and Common shares offering costs charged to paid-in capital   $     $     $     $     $ (0.054 )  
Preferred shares underwriting discounts   $     $     $     $     $ (0.089 )  
Net asset value — End of year (Common shares)   $ 15.020     $ 15.330     $ 14.810     $ 14.510     $ 14.560    
Market value — End of year (Common shares)   $ 14.250     $ 14.635     $ 14.770     $ 14.580     $ 13.800    
Total Investment Return on Net Asset Value(4)      2.75 %     9.15 %     8.65 %     6.84 %     6.62 %(5)   
Total Investment Return on Market Value(4)      2.11 %     4.49 %     7.84 %     13.27 %     1.06 %(5)   

 

See notes to financial statements
50



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FINANCIAL STATEMENTS CONT'D

Financial Highlights

Selected data for a common share outstanding during the periods stated

    Insured California Fund II  
    Year Ended September 30,  
    2007(1)    2006(1)    2005(1)    2004(1)    2003(1)(2)   
Ratios/Supplemental Data          
Net assets applicable to common shares, end of year (000's omitted)   $ 58,010     $ 59,199     $ 57,187     $ 55,955     $ 56,083    
Ratios (As a percentage of average net assets applicable to common shares):(6)                                          
Expenses excluding interest and fees     1.11 %(8)     1.13 %     1.10 %     1.09 %     0.98 %(9)  
Interest and fee expense(7)     0.50 %     0.48 %     0.31 %     0.15 %     0.15 %(9)  
Total expenses before custodian fee reduction     1.61 %(8)     1.61 %     1.41 %     1.24 %     1.13 %(9)  
Expenses after custodian fee reduction excluding interest and fees     1.09 %(8)     1.11 %     1.06 %     1.08 %     0.96 %(9)  
Net investment income     6.42 %     6.66 %     6.81 %     7.27 %     6.75 %(9)  
Portfolio Turnover     37 %     13 %     13 %     11 %     22 %  

 

The ratios reported above are based on net assets applicable solely to common shares. The ratios based on net assets, including amounts related to preferred shares, are as follows:

Ratios (As a percentage of average total net assets applicable to common shares and preferred shares):(6)                  
Expenses excluding interest and fees     0.71 %(8)     0.71 %     0.69 %     0.68 %     0.64 %(9)  
Interest and fee expense(7)     0.32 %     0.30 %     0.20 %     0.09 %     0.10 %(9)  
Total expenses before custodian fee reduction     1.03 %(8)     1.01 %     0.89 %     0.77 %     0.74 %(9)  
Expenses after custodian fee reduction excluding interest and fees     0.69 %(8)     0.70 %     0.67 %     0.67 %     0.63 %(9)  
Net investment income     4.09 %     4.19 %     4.28 %     4.54 %     4.46 %(9)  
Senior Securities:  
Total preferred shares outstanding     1,350       1,350       1,350       1,350       1,350    
Asset coverage per preferred share(10)   $ 67,980     $ 68,858     $ 67,364     $ 66,455     $ 66,545    
Involuntary liquidation preference per preferred share(11)   $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000    
Approximate market value per preferred share(11)   $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000    

 

(1)  Per share net investment income was computed using average common shares outstanding.

(2)  For the period from the start of business, November 29, 2002, to September 30, 2003.

(3)  Net asset value at beginning of period reflects the deduction of the sales load of $0.675 per share paid by the shareholder from the $15.000 offering price.

(4)  Returns are historical and are calculated by determining the percentage change in net asset value or market value with all distributions reinvested.

(5)  Total investment return on net asset value is calculated assuming a purchase at the offering price of $15.000 less the sales load of $0.675 per share paid by the shareholder on the first day and a sale at the net asset value on the last day of the period reported. Total investment return on market value is calculated assuming a purchase at the offering price of $15.000 less the sales load of $0.675 per share paid by the shareholder on the first day and a sale at the current market price on the last day of the period reported. Total investment return on net asset value and total investment return on market value are not computed on an annualized basis.

(6)  Ratios do not reflect the effect of dividend payments to preferred shareholders.

(7)  Interest and fee expense relates to the liability for floating rate notes issued in conjunction with inverse floater securities transactions (see note 1H).

(8)  The investment adviser was allocated a portion of the Fund's operating expenses (equal to less than 0.01% of average daily net assets for the year ended September 30, 2007). Absent this allocation, total return would be lower.

(9)  Annualized.

(10)  Calculated by subtracting the Fund's total liabilities (not including the preferred shares) from the Fund's total assets, and dividing this by the number of preferred shares outstanding.

(11)  Plus accumulated and unpaid dividends.

See notes to financial statements
51



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FINANCIAL STATEMENTS CONT'D

Financial Highlights

Selected data for a common share outstanding during the periods stated

    Insured Florida Fund  
    Year Ended September 30,  
    2007(1)    2006(1)    2005(1)    2004(1)    2003(1)(2)   
Net asset value — Beginning of year (Common shares)   $ 15.190     $ 14.870     $ 14.520     $ 14.550     $ 14.325 (3)   
Income (loss) from operations  
Net investment income   $ 0.978     $ 0.981     $ 1.018     $ 1.062     $ 0.788    
Net realized and unrealized gain (loss)     (0.411 )     0.348       0.399       0.002 (4)      0.319    
Distributions to preferred shareholders  
From net investment income     (0.309 )     (0.266 )     (0.159 )     (0.077 )     (0.060 )  
From net realized gain                       (0.007 )        
Total income from operations   $ 0.258     $ 1.063     $ 1.258     $ 0.980     $ 1.047    
Less distributions to common shareholders  
From net investment income   $ (0.658 )   $ (0.743 )   $ (0.908 )   $ (0.930 )   $ (0.675 )  
From net realized gain                       (0.080 )        
Total distributions to common shareholders   $ (0.658 )   $ (0.743 )   $ (0.908 )   $ (1.010 )   $ (0.675 )  
Preferred and Common shares offering costs
charged to paid-in capital
  $     $     $     $     $ (0.058 )  
Preferred shares underwriting discounts   $     $     $     $     $ (0.089 )  
Net asset value — End of year (Common shares)   $ 14.790     $ 15.190     $ 14.870     $ 14.520     $ 14.550    
Market value — End of year (Common shares)   $ 13.550     $ 14.410     $ 14.980     $ 14.750     $ 14.100    
Total Investment Return on Net Asset Value(5)      2.00 %     7.64 %     8.85 %     7.12 %     6.37 %(6)   
Total Investment Return on Market Value(5)      (1.48 )%     1.37 %     7.94 %     12.29 %     3.08 %(6)   

 

See notes to financial statements
52



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FINANCIAL STATEMENTS CONT'D

Financial Highlights

Selected data for a common share outstanding during the periods stated

    Insured Florida Fund  
    Year Ended September 30,  
    2007(1)    2006(1)    2005(1)    2004(1)    2003(1)(2)   
Ratios/Supplemental Data          
Net assets applicable to common shares, end of year (000's omitted)   $ 38,086     $ 39,129     $ 38,269     $ 37,211     $ 37,186    
Ratios (As a percentage of average net assets applicable to common shares):(7)  
Expenses excluding interest and fees     1.17 %(9)     1.20 %     1.17 %     1.14 %     1.04 %(10)  
Interest and fee expense(8)     0.48 %     0.47 %     0.29 %     0.18 %     0.09 %(10)  
Total expenses before custodian fee reduction     1.65 %(9)     1.67 %     1.46 %     1.32 %     1.13 %(10)  
Expenses after custodian fee reduction excluding interest and fees     1.16 %(9)     1.19 %     1.16 %     1.14 %     0.98 %(10)  
Net investment income     6.48 %     6.63 %     6.84 %     7.30 %     6.45 %(10)  
Portfolio Turnover     32 %     16 %     13 %     17 %     10 %  

 

The ratios reported above are based on net assets applicable solely to common shares. The ratios based on net assets, including amounts related to preferred shares, are as follows:

Ratios (As a percentage of average total net assets applicable to common shares and preferred shares):(7)  
Expenses excluding interest and fees     0.74 %(9)     0.76 %     0.74 %     0.71 %     0.69 %(10)  
Interest and fee expense(8)     0.30 %     0.29 %     0.18 %     0.11 %     0.06 %(10)  
Total expenses before custodian fee reduction     1.04 %(9)     1.05 %     0.92 %     0.82 %     0.75 %(10)  
Expenses after custodian fee reduction excluding interest and fees     0.73 %(9)     0.75 %     0.73 %     0.71 %     0.65 %(10)  
Net investment income     4.10 %     4.17 %     4.30 %     4.55 %     4.25 %(10)  
Senior Securities:  
Total preferred shares outstanding     900       900       900       900       900    
Asset coverage per preferred share(11)   $ 67,333     $ 68,489     $ 67,528     $ 66,348     $ 66,319    
Involuntary liquidation preference per preferred share(12)   $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000    
Approximate market value per preferred share(12)   $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000    

 

(1)  Per share net investment income was computed using average common shares outstanding.

(2)  For the period from the start of business, November 29, 2002, to September 30, 2003.

(3)  Net asset value at beginning of period reflects the deduction of the sales load of $0.675 per share paid by the shareholder from the $15.000 offering price.

(4)  The per share amount does not reflect the actual net realized and unrealized gain/loss for the period because of the timing of reinvested shares of the Fund and the amount of per share realized gains and losses at such time.

(5)  Returns are historical and are calculated by determining the percentage change in net asset value or market value with all distributions reinvested.

(6)  Total investment return on net asset value is calculated assuming a purchase at the offering price of $15.000 less the sales load of $0.675 per share paid by the shareholder on the first day and a sale at the net asset value on the last day of the period reported. Total investment return on market value is calculated assuming a purchase at the offering price of $15.000 less the sales load of $0.675 per share paid by the shareholder on the first day and sale at the current market price on the last day of the period reported. Total investment return on net asset value and total investment return on market value are not computed on an annualized basis.

(7)  Ratios do not reflect the effect of dividend payments to preferred shareholders.

(8)  Interest and fee expense relates to the liability for floating rate notes issued in conjunction with inverse floater securities transactions (see Note 1H).

(9)  The investment adviser was allocated a portion of the Fund's operating expenses (equal to less than 0.01% of average daily net assets for the year ended September 30, 2007). Absent this allocation, total return would be lower.

(10)  Annualized.

(11)  Calculated by subtracting the Fund's total liabilities (not including the preferred shares) from the Fund's total assets, and dividing this number by the number of preferred shares outstanding.

(12)  Plus accumulated and unpaid dividends.

See notes to financial statements
53



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FINANCIAL STATEMENTS CONT'D

Financial Highlights

Selected data for a common share outstanding during the periods stated

    Insured Massachusetts Fund  
    Year Ended September 30,  
    2007(1)    2006(1)    2005(1)    2004(1)    2003(1)(2)   
Net asset value — Beginning of year (Common shares)   $ 15.640     $ 15.100     $ 14.870     $ 14.670     $ 14.325 (3)   
Income (loss) from operations  
Net investment income   $ 0.969     $ 0.983     $ 1.031     $ 1.109     $ 0.823    
Net realized and unrealized gain (loss)     (0.540 )     0.613       0.290       0.350       0.411    
Distributions to preferred shareholders  
From net investment income     (0.293 )     (0.256 )     (0.143 )     (0.069 )     (0.058 )  
From net realized gain                       (0.017 )        
Total income from operations   $ 0.136     $ 1.340     $ 1.178     $ 1.373     $ 1.176    
Less distributions to common shareholders  
From net investment income   $ (0.686 )   $ (0.800 )   $ (0.948 )   $ (0.948 )   $ (0.675 )  
From net realized gain                       (0.225 )        
Total distributions to common shareholders   $ (0.686 )   $ (0.800 )   $ (0.948 )   $ (1.173 )   $ (0.675 )  
Preferred and Common shares offering costs
charged to paid-in capital
  $     $     $     $     $ (0.066 )  
Preferred shares underwriting discounts   $     $     $     $     $ (0.090 )  
Net asset value — End of year (Common shares)   $ 15.090     $ 15.640     $ 15.100     $ 14.870     $ 14.670    
Market value — End of year (Common shares)   $ 14.820     $ 16.090     $ 17.350     $ 15.570     $ 14.450    
Total Investment Return on Net Asset Value(4)      0.88 %(5)      9.14 %     7.74 %     9.74 %     7.22 %(6)   
Total Investment Return on Market Value(4)      (3.72 )%(5)      (2.28 )%     18.23 %     16.66 %     5.61 %(6)   

 

See notes to financial statements
54



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FINANCIAL STATEMENTS CONT'D

Financial Highlights

Selected data for a common share outstanding during the periods stated

    Insured Massachusetts Fund  
    Year Ended September 30,  
    2007(1)    2006(1)    2005(1)    2004(1)    2003(1)(2)   
Ratios/Supplemental Data          
Net assets applicable to common shares, end of period (000's omitted)   $ 26,476     $ 27,419     $ 26,441     $ 25,982     $ 25,586    
Ratios (As a percentage of average net assets applicable to common shares):(7)  
Expenses excluding interest and fees     1.25 %(9)     1.29 %     1.25 %     1.24 %     1.10 %(10)  
Interest and fee expense(8)     0.98 %     1.54 %     1.26 %     0.79 %     0.26 %(10)  
Total expenses before custodian fee reduction     2.23 %(9)     2.83 %     2.51 %     2.03 %     1.36 %(10)  
Expenses after custodian fee reduction excluding interest and fees     1.25 %(9)     1.26 %     1.24 %     1.24 %     1.06 %(10)  
Net investment income     6.27 %     6.50 %     6.79 %     7.58 %     6.73 %(10)  
Portfolio Turnover     15 %     15 %     11 %     33 %     35 %  

 

The ratios reported above are based on net assets applicable solely to common shares. The ratios based on net assets, including amounts related to preferred shares, are as follows:

Ratios (As a percentage of average total net assets applicable to common shares and preferred shares):(7)  
Expenses excluding interest and fees     0.81 %(9)     0.81 %     0.79 %     0.77 %     0.73 %(10)  
Interest and fee expense(8)     0.62 %     0.97 %     0.80 %     0.49 %     0.17 %(10)  
Total expenses before custodian fee reduction     1.43 %(9)     1.78 %     1.59 %     1.26 %     0.90 %(10)  
Expenses after custodian fee reduction excluding interest and fees     0.80 %(9)     0.80 %     0.78 %     0.77 %     0.70 %(10)  
Net investment income     3.99 %     4.10 %     4.29 %     4.72 %     4.42 %(10)  
Senior Securities:  
Total preferred shares outstanding     620       620       620       620       620    
Asset coverage per preferred share(11)   $ 67,711     $ 69,229     $ 67,649     $ 66,907     $ 66,270    
Involuntary liquidation preference per preferred share(12)   $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000    
Approximate market value per preferred share(12)   $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000    

 

(1)  Per share net investment income was computed using average common shares outstanding.

(2)  For the period from the start of business, November 29, 2002 to September 30, 2003.

(3)  Net asset value at the beginning of period reflects the deduction of the sales load of $0.675 per share paid by the shareholder from the $15.000 offering price.

(4)  Returns are historical and are calculated by determining the percentage change in net asset value or market value with all distributions reinvested.

(5)  During the year ended September 30, 2007, the Fund realized a gain on the disposal of an investment security which did not meet investment guidelines. The gain was less than $0.01 per share and had no effect on total return.

(6)  Total investment return on net asset value is calculated assuming a purchase at the offering price of $15.000 less the sales load of $0.675 per share paid by the shareholder on the first day and a sale at the net asset value on the last day of the period reported. Total investment return on market value is calculated assuming a purchase at the offering price of $15.000 less the sales load of $0.675 per share paid by the shareholder on the first day and a sale at the current market price on the last day of the period reported. Total investment return on net asset value and total investment return on market value are not computed on an annualized basis.

(7)  Ratios do not reflect the effect of dividend payments to preferred shareholders.

(8)  Interest and fee expense relates to the liability for floating rate notes issued in conjunction with inverse floater securities transactions (see Note 1H).

(9)  The investment adviser was allocated a portion of the Fund's operating expenses (equal to less than 0.01% of average daily net assets for the year ended September 30, 2007). Absent this allocation, total return would be lower.

(10)  Annualized.

(11)  Calculated by subtracting the Fund's total liabilities (not including the preferred shares) from the Fund's total assets, and dividing this by the number of preferred shares outstanding.

(12)  Plus accumulated and unpaid dividends.

See notes to financial statements
55



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FINANCIAL STATEMENTS CONT'D

Financial Highlights

Selected data for a common share outstanding during the periods stated

    Insured Michigan Fund  
    Year Ended September 30,  
    2007(1)    2006(1)    2005(1)    2004(1)    2003(1)(2)   
Net asset value — Beginning of year (Common shares)   $ 15.430     $ 15.000     $ 14.840     $ 14.520     $ 14.325 (3)   
Income (loss) from operations  
Net investment income   $ 0.985     $ 0.991     $ 1.039     $ 1.105     $ 0.824    
Net realized and unrealized gain (loss)     (0.309 )     0.462       0.233       0.252       0.262    
Distributions to preferred shareholders  
From net investment income     (0.288 )     (0.252 )     (0.164 )     (0.089 )     (0.058 )  
Total income from operations   $ 0.388     $ 1.201     $ 1.108     $ 1.268     $ 1.028    
Less distributions to common shareholders  
From net investment income   $ (0.668 )   $ (0.771 )   $ (0.948 )   $ (0.948 )   $ (0.675 )  
Total distributions to common shareholders   $ (0.668 )   $ (0.771 )   $ (0.948 )   $ (0.948 )   $ (0.675 )  
Preferred and Common shares offering costs
charged to paid-in capital
  $     $     $     $     $ (0.068 )  
Preferred shares underwriting discounts   $     $     $     $     $ (0.090 )  
Net asset value — End of year (Common shares)   $ 15.150     $ 15.430     $ 15.000     $ 14.840     $ 14.520    
Market value — End of year (Common shares)   $ 14.030     $ 14.190     $ 16.200     $ 15.490     $ 14.410    
Total Investment Return on Net Asset Value(4)      2.81 %     8.44 %     7.52 %     8.96 %     6.12 %(5)   
Total Investment Return on Market Value(4)      3.53 %     (7.67 )%     11.26 %     14.60 %     5.31 %(5)   

 

See notes to financial statements
56



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FINANCIAL STATEMENTS CONT'D

Financial Highlights

Selected data for a common share outstanding during the periods stated

    Insured Michigan Fund  
    Year Ended September 30,  
    2007(1)    2006(1)    2005(1)    2004(1)    2003(1)(2)   
Ratios/Supplemental Data          
Net assets applicable to common shares, end of year (000's omitted)   $ 22,912     $ 23,335     $ 22,670     $ 22,396     $ 21,893    
Ratios (As a percentage of average net assets applicable to common shares):(6)  
Expenses excluding interest and fees     1.29 %(8)     1.32 %     1.28 %     1.28 %     1.14 %(9)  
Interest and fee expense(7)     0.98 %     0.90 %     0.60 %     0.33 %     1.27 %(9)  
Total expenses before custodian fee reduction     2.27 %(8)     2.22 %     1.88 %     1.61 %     2.41 %(9)  
Expenses after custodian fee reduction excluding interest and fees     1.27 %(8)     1.30 %     1.27 %     1.27 %     1.09 %(9)  
Net investment income     6.43 %     6.62 %     6.88 %     7.56 %     6.75 %(9)  
Portfolio Turnover     6 %     6 %     5 %     7 %     45 %  

 

The ratios reported above are based on net assets applicable solely to common shares. The ratios based on net assets, including amounts related to preferred shares, are as follows:

Ratios (As a percentage of average total net assets applicable to common shares and preferred shares):(6)  
Expenses excluding interest and fees     0.81 %(8)     0.83 %     0.81 %     0.79 %     0.75 %(9)  
Interest and fee expense(7)     0.62 %     0.56 %     0.38 %     0.21 %     0.83 %(9)  
Total expenses before custodian fee reduction     1.43 %(8)     1.39 %     1.19 %     1.00 %     1.58 %(9)  
Expenses after custodian fee reduction excluding interest and fees     0.80 %(8)     0.82 %     0.80 %     0.78 %     0.71 %(9)  
Net investment income     4.06 %     4.15 %     4.32 %     4.69 %     4.42 %(9)  
Senior Securities:  
Total preferred shares outstanding     540       540       540       540       540    
Asset coverage per preferred share(10)   $ 67,442     $ 68,222     $ 66,986     $ 66,475     $ 65,543    
Involuntary liquidation preference per preferred share(11)   $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000    
Approximate market value per preferred share(11)   $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000    

 

(1)  Per share net investment income was computed using average common shares outstanding.

(2)  For the period from the start of business, November 29, 2002, to September 30, 2003.

(3)  Net asset value at beginning of period reflects the deduction of the sales load of $0.675 per share paid by the shareholder from the $15.000 offering price.

(4)  Returns are historical and are calculated by determining the percentage change in net asset value or market value with all distributions reinvested.

(5)  Total investment return on net asset value is calculated assuming a purchase at the offering of $15.000 less the sales load of $0.675 per share paid by the shareholder on the first day and a sale at the net asset value on the last day of the period reported. Total investment return on market value is calculated assuming a purchase at the offering price of $15.000 less the sales load of $0.675 per share paid by the shareholder on the first day and a sale at the current market price on the last day of the period reported. Total investment return on net asset value and total investment return on market value are not computed on an annualized basis.

(6)  Ratios do not reflect the effect of dividend payments to preferred shareholders.

(7)  Interest and fee expense relates to the liability for floating rate notes issued in conjunction with inverse floater securities transactions (see Note 1H).

(8)  The investment adviser was allocated a portion of the Fund's operating expenses (equal to less than 0.01% of average daily net assets for the year ended September 30, 2007). Absent this allocation, total return would be lower.

(9)  Annualized.

(10)  Calculated by subtracting the Fund's total liabilities (not including the preferred shares) from the Fund's total assets, and dividing this by the number of preferred shares outstanding.

(11)  Plus accumulated and unpaid dividends.

See notes to financial statements
57




Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FINANCIAL STATEMENTS CONT'D

Financial Highlights

Selected data for a common share outstanding during the periods stated

    Insured New Jersey Fund  
    Year Ended September 30,  
    2007(1)    2006(1)    2005(1)    2004(1)    2003(1)(2)   
Net asset value — Beginning of year (Common shares)   $ 15.840     $ 15.240     $ 14.990     $ 14.760     $ 14.325 (3)   
Income (loss) from operations  
Net investment income   $ 0.996     $ 1.002     $ 1.039     $ 1.117     $ 0.826    
Net realized and unrealized gain (loss)     (0.150 )     0.671       0.330       0.361       0.489    
Distributions to preferred shareholders  
From net investment income     (0.286 )     (0.253 )     (0.159 )     (0.067 )     (0.058 )  
From net realized gain                       (0.015 )        
Total income from operations   $ 0.560     $ 1.420     $ 1.210     $ 1.396     $ 1.257    
Less distributions to common shareholders  
From net investment income   $ (0.710 )   $ (0.820 )   $ (0.960 )   $ (0.960 )   $ (0.675 )  
From net realized gain                       (0.206 )        
Total distributions to common shareholders   $ (0.710 )   $ (0.820 )   $ (0.960 )   $ (1.166 )   $ (0.675 )  
Preferred and Common shares offering costs
charged to paid-in capital
  $     $     $     $     $ (0.058 )  
Preferred shares underwriting discounts   $     $     $     $     $ (0.089 )  
Net asset value — End of year (Common shares)   $ 15.690     $ 15.840     $ 15.240     $ 14.990     $ 14.760    
Market value — End of year (Common shares)   $ 14.790     $ 16.400     $ 16.240     $ 15.490     $ 14.520    
Total Investment Return on Net Asset Value(4)      3.64 %     9.65 %     8.18 %     9.83 %     7.89 %(5)   
Total Investment Return on Market Value(4)      (5.66 )%     6.53 %     11.56 %     15.37 %     6.14 %(5)   

 

See notes to financial statements
58



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FINANCIAL STATEMENTS CONT'D

Financial Highlights

Selected data for a common share outstanding during the periods stated

    Insured New Jersey Fund  
    Year Ended September 30,  
    2007(1)    2006(1)    2005(1)    2004(1)    2003(1)(2)   
Ratios/Supplemental Data  
Net assets applicable to common shares, end of year (000's omitted)   $ 40,262     $ 40,620     $ 39,032     $ 38,326     $ 37,687    
Ratios (As a percentage of average net assets applicable to common shares):(6)  
Expenses excluding interest and fees     1.14 %(8)     1.19 %     1.15 %     1.13 %     1.03 %(9)  
Interest and fee expense(7)     0.92 %     0.86 %     0.59 %     0.31 %     0.27 %(9)  
Total expenses before custodian fee reduction     2.06 %(8)     2.05 %     1.74 %     1.44 %     1.30 %(9)  
Expenses after custodian fee reduction excluding interest and fees     1.11 %(8)     1.16 %     1.14 %     1.13 %     0.99 %(9)  
Net investment income     6.29 %     6.59 %     6.78 %     7.54 %     6.69 %(9)  
Portfolio Turnover     27 %     22 %     15 %     19 %     34 %  

 

The ratios reported above are based on net assets applicable solely to common shares. The ratios based on net assets, including amounts related to preferred shares, are as follows:

Ratios (As a percentage of average total net assets applicable to common shares and preferred shares):(6)  
Expenses excluding interest and fees     0.73 %(8)     0.75 %     0.73 %     0.71 %     0.69 %(9)  
Interest and fee expense(7)     0.59 %     0.55 %     0.38 %     0.20 %     0.18 %(9)  
Total expenses before custodian fee reduction     1.32 %(8)     1.30 %     1.11 %     0.91 %     0.87 %(9)  
Expenses after custodian fee reduction excluding interest and fees     0.72 %(8)     0.73 %     0.72 %     0.71 %     0.66 %(9)  
Net investment income     4.05 %     4.18 %     4.31 %     4.73 %     4.43 %(9)  
Senior Securities:  
Total preferred shares outstanding     900       900       900       900       900    
Asset coverage per preferred share(10)   $ 69,751     $ 70,144     $ 68,375     $ 67,588     $ 66,875    
Involuntary liquidation preference per preferred share(11)   $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000    
Approximate market value per preferred share(11)   $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000    

 

(1)  Per share net investment income was computed using average common shares outstanding.

(2)  For the period from the start of business, November 29, 2002, to September 30, 2003.

(3)  Net asset value at beginning of period reflects the deduction of the sales load of $0.675 per share paid by the shareholder from the $15.000 offering price.

(4)  Returns are historical and are calculated by determining the percentage change in net asset value or market value with all distributions reinvested.

(5)  Total investment return on net asset value is calculated assuming a purchase at the offering price of $15.000 less the sales load of $0.675 per share paid by the shareholder on the first day and a sale at the net asset value on the last day of the period reported. Total investment return on market value is calculated assuming a purchase at the offering price of $15.000 less the sales load of $0.675 per share paid by the shareholder on the first day and a sale at the current market price on the last day of the period reported. Total investment return on net asset value and total investment return on market value are not computed on an annualized basis.

(6)  Ratios do not reflect the effect of dividend payments to preferred shareholders.

(7)  Interest and fee expense relates to the liability for floating rate notes issued in conjunction with inverse floater securities transactions (see Note 1H).

(8)  The investment adviser was allocated a portion of the Fund's operating expenses (equal to less than 0.01% of average daily net assets for the year ended September 30, 2007). Absent this allocation, total return would be lower.

(9)  Annualized.

(10)  Calculated by subtracting the Fund's total liabilities (not including the preferred shares) from the Fund's total assets, and dividing this by the number of preferred shares outstanding.

(11)  Plus accumulated and unpaid dividends.

See notes to financial statements
59



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FINANCIAL STATEMENTS CONT'D

Financial Highlights

Selected data for a common share outstanding during the periods stated

    Insured New York Fund II  
    Year Ended September 30,  
    2007(1)    2006(1)    2005(1)    2004(1)    2003(1)(2)   
Net asset value — Beginning of year (Common shares)   $ 15.760     $ 15.300     $ 14.910     $ 14.870     $ 14.325 (3)   
Income (loss) from operations  
Net investment income   $ 0.969     $ 0.990     $ 1.008     $ 1.080     $ 0.818    
Net realized and unrealized gain (loss)     (0.256 )     0.542       0.462       0.223       0.617    
Distributions to preferred shareholders  
From net investment income     (0.209 )     (0.240 )     (0.148 )     (0.063 )     (0.057 )  
From net realized gain     (0.079 )     (0.015 )           (0.016 )        
Total income from operations   $ 0.425     $ 1.277     $ 1.322     $ 1.224     $ 1.378    
Less distributions to common shareholders  
From net investment income   $ (0.697 )   $ (0.732 )   $ (0.932 )   $ (0.963 )   $ (0.686 )  
From net realized gain     (0.248 )     (0.085 )           (0.221 )        
Total distributions to common shareholders   $ (0.945 )   $ (0.817 )   $ (0.932 )   $ (1.184 )   $ (0.686 )  
Preferred and Common shares offering costs
charged to paid-in capital
  $     $     $     $     $ (0.058 )  
Preferred shares underwriting discounts   $     $     $     $     $ (0.089 )  
Net asset value — End of year (Common shares)   $ 15.240     $ 15.760     $ 15.300     $ 14.910     $ 14.870    
Market value — End of year (Common shares)   $ 14.440     $ 14.420     $ 14.570     $ 14.460     $ 13.710    
Total Investment Return on Net Asset Value(4)      3.00 %     9.02 %     9.17 %     8.75 %(5)      8.87 %(6)   
Total Investment Return on Market Value(4)      6.66 %     4.75 %     7.19 %     14.39 %(5)      0.38 %(6)   

 

See notes to financial statements
60



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FINANCIAL STATEMENTS CONT'D

Financial Highlights

Selected data for a common share outstanding during the periods stated

    Insured New York Fund II  
    Year Ended September 30,  
    2007(1)    2006(1)    2005(1)    2004(1)    2003(1)(2)   
Ratios/Supplemental Data  
Net assets applicable to common shares, end of year (000's omitted)   $ 38,947     $ 40,263     $ 39,101     $ 38,089     $ 37,984    
Ratios (As a percentage of average net assets applicable to common shares):(7)  
Expenses excluding interest and fees     1.16 %(8)     1.14 %     1.21 %     1.14 %     1.03 %(9)  
Interest and fee expense(10)     0.46 %     0.42 %     0.28 %     0.16 %     0.14 %(9)  
Total expenses before custodian fee reduction     1.62 %(8)     1.56 %     1.49 %     1.30 %     1.17 %(9)  
Expenses after custodian fee reduction excluding interest and fees     1.14 %(8)     1.11 %     1.19 %     1.13 %     0.98 %(9)  
Net investment income     6.24 %     6.48 %     6.60 %     7.31 %     6.65 %(9)  
Portfolio Turnover     38 %     26 %     29 %     26 %     49 %  

 

The ratios reported above are based on net assets applicable solely to common shares. The ratios based on net assets, including amounts related to preferred shares, are as follows:

Ratios (As a percentage of average total net assets applicable to common shares and preferred shares):(7)  
Expenses excluding interest and fees     0.74 %(8)     0.72 %     0.77 %     0.71 %     0.68 %(9)  
Interest and fee expense(10)     0.29 %     0.27 %     0.18 %     0.10 %     0.09 %(9)  
Total expenses before custodian fee reduction     1.03 %(8)     0.99 %     0.95 %     0.81 %     0.77 %(9)  
Expenses after custodian fee reduction excluding interest and fees     0.73 %(8)     0.71 %     0.76 %     0.71 %     0.65 %(9)  
Net investment income     3.98 %     4.11 %     4.18 %     4.58 %     4.409 %(9)  
Senior Securities:  
Total preferred shares outstanding     900       900       900       900       900    
Asset coverage per preferred share(11)   $ 68,285     $ 69,746     $ 68,450     $ 67,323     $ 67,209    
Involuntary liquidation preference per preferred share(12)   $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000    
Approximate market value per preferred share(12)   $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000    

 

(1)  Per share net investment income was computed using average common shares outstanding.

(2)  For the period from the start of business, November 29, 2002, to September 30, 2003.

(3)  Net asset value at beginning of period reflects the deduction of the sales load of $0.675 per share paid by the shareholder from the $15.000 offering price.

(4)  Returns are historical and are calculated by determining the percentage change in net asset value or market value with all distributions reinvested.

(5)  During the year ended September 30, 2004, the investment adviser reimbursed the Fund for a net loss realized on the disposal of an investment in violation of restrictions. The reimbursement was less than $0.01 per common share and had no effect on total investment return on net asset value and total investment return on market value for the year ended September 30, 2004.

(6)  Total investment return on net asset value is calculated assuming a purchase at the offering price of $15.000 less the sales load of $0.675 per share paid by the shareholder on the first day and a sale at the net asset value on the last day of the period reported. Total investment return on market value is calculated assuming a purchase at the offering price of $15.000 less the sales load of $0.675 per share paid by the shareholder on the first day and a sale at the current market price on the last day of the period reported. Total investment return on net asset value and total investment return on market value are not computed on an annualized basis.

(7)  Ratios do not reflect the effect of dividend payments to preferred shareholders.

(8)  The investment adviser was allocated a portion of the Fund's operating expenses (equal to less than 0.01% of average daily net assets for the year ended September 30, 2007). Absent this allocation, total return would be lower.

(9)  Annualized.

(10)  Interest and fee expense relates to the liability for floating rate notes issued in conjunction with inverse floater securities
transactions (see Note 1H).

(11)  Calculated by subtracting the Fund's total liabilities (not including the preferred shares) from the Fund's total assets, and dividing this by the number of preferred shares outstanding.

(12)  Plus accumulated and unpaid dividends.

See notes to financial statements
61



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FINANCIAL STATEMENTS CONT'D

Financial Highlights

Selected data for a common share outstanding during the periods stated

    Insured Ohio Fund  
    Year Ended September 30,  
    2007(1)    2006(1)    2005(1)    2004(1)    2003(1)(2)   
Net asset value — Beginning of year (Common shares)   $ 15.330     $ 14.830     $ 14.640     $ 14.620     $ 14.325 (3)   
Income (loss) from operations  
Net investment income   $ 0.966     $ 0.978     $ 1.006     $ 1.054     $ 0.776    
Net realized and unrealized gain (loss)     (0.361 )     0.497       0.219       0.018       0.402    
Distributions to preferred shareholders  
From net investment income     (0.301 )     (0.263 )     (0.173 )     (0.086 )     (0.060 )  
From net realized gain                       (0.003 )        
Total income from operations   $ 0.304     $ 1.212     $ 1.052     $ 0.983     $ 1.118    
Less distributions to common shareholders  
From net investment income   $ (0.664 )   $ (0.712 )   $ (0.862 )   $ (0.930 )   $ (0.675 )  
From net realized gain                       (0.033 )        
Total distributions to common shareholders   $ (0.664 )   $ (0.712 )   $ (0.862 )   $ (0.963 )   $ (0.675 )  
Preferred and Common shares offering costs
charged to paid-in capital
  $     $     $     $     $ (0.060 )  
Preferred shares underwriting discounts   $     $     $     $     $ (0.088 )  
Net asset value — End of year (Common shares)   $ 14.970     $ 15.330     $ 14.830     $ 14.640     $ 14.620    
Market value — End of year (Common shares)   $ 13.710     $ 14.600     $ 14.510     $ 15.200     $ 14.430    
Total Investment Return on Net Asset Value(4)      2.17 %     8.58 %     7.29 %     6.94 %     6.85 %(5)   
Total Investment Return on Market Value(4)      (1.75 )%     5.69 %     1.11 %     12.49 %     5.46 %(5)   

 

See notes to financial statements
62



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FINANCIAL STATEMENTS CONT'D

Financial Highlights

Selected data for a common share outstanding during the periods stated

    Insured Ohio Fund  
    Year Ended September 30,  
    2007(1)    2006(1)    2005(1)    2004(1)    2003(1)(2)   
Ratios/Supplemental Data  
Net assets applicable to common shares, end of year (000's omitted)   $ 37,617     $ 38,532     $ 37,255     $ 36,746     $ 36,610    
Ratios (As a percentage of average net assets applicable to common shares):(6)  
Expenses excluding interest and fees     1.16 %(7)     1.19 %     1.18 %     1.17 %     1.05 %(8)  
Interest and fee expense(9)     0.53 %     0.41 %     0.25 %     0.13 %     0.09 %(8)  
Total expenses before custodian fee reduction     1.69 %(7)     1.60 %     1.43 %     1.30 %     1.14 %(8)  
Expenses after custodian fee reduction excluding interest and fees     1.14 %(7)     1.16 %     1.16 %     1.16 %     0.99 %(8)  
Net investment income     6.33 %     6.56 %     6.76 %     7.30 %     6.38 %(8)  
Portfolio Turnover     30 %     16 %     8 %     23 %     19 %  

 

The ratios reported above are based on net assets applicable solely to common shares. The ratios based on net assets, including amounts related to preferred shares, are as follows:

Ratios (As a percentage of average total net assets applicable to common shares and preferred shares):(6)  
Expenses excluding interest and fees     0.74 %(7)     0.75 %     0.74 %     0.73 %     0.69 %(8)  
Interest and fee expense(9)     0.34 %     0.26 %     0.16 %     0.08 %     0.07 %(8)  
Total expenses before custodian fee reduction     1.08 %(7)     1.01 %     0.90 %     0.81 %     0.76 %(8)  
Expenses after custodian fee reduction excluding interest and fees     0.72 %(7)     0.73 %     0.73 %     0.72 %     0.65 %(8)  
Net investment income     4.03 %     4.14 %     4.26 %     4.55 %     4.21 %(8)  
Senior Securities:  
Total preferred shares outstanding     875       875       875       875       875    
Asset coverage per preferred share(10)   $ 67,991     $ 69,036     $ 67,586     $ 66,999     $ 66,841    
Involuntary liquidation preference per preferred share(11)   $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000    
Approximate market value per preferred share(11)   $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000    

 

(1)  Per share net investment income was computed using average common shares outstanding.

(2)  For the period from the start of business, November 29, 2002, to September 30, 2003.

(3)  Net asset value at beginning of period reflects the deduction of the sales load of $0.675 per share paid by the shareholder from the $15.000 offering price.

(4)  Returns are historical and are calculated by determining the percentage change in net asset value or market value with all distributions reinvested.

(5)  Total investment return on net asset value is calculated assuming a purchase at the offering price of $15.000 less the sales load of $0.675 per share paid by the shareholder on the first day and a sale at the net asset value on the last day of the period reported. Total investment return on market value is calculated assuming a purchase at the offering price of $15.000 less the sales load of $0.675 per share paid by the shareholder on the first day and a sale at the current market price on the last day of the period reported. Total investment return on net asset value and total investment return on market value are not computed on an annualized basis.

(6)  Ratios do not reflect the effect of dividend payments to preferred shareholders.

(7)  The investment adviser was allocated a portion of the Fund's operating expenses (equal to less than 0.01% of average daily net assets for the year ended September 30, 2007). Absent this allocation, total return would be lower.

(8)  Annualized.

(9)  Interest and fee expense relates to the liability for floating rate notes issued in conjunction with inverse floater securities transactions (see Note 1H).

(10)  Calculated by subtracting the Fund's total liabilities (not including the preferred shares) from the Fund's total assets, and dividing this by the number of preferred shares outstanding.

(11)  Plus accumulated and unpaid dividends.

See notes to financial statements
63



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FINANCIAL STATEMENTS CONT'D

Financial Highlights

Selected data for a common share outstanding during the periods stated

    Insured Pennsylvania Fund  
    Year Ended September 30,  
    2007(1)    2006(1)    2005(1)    2004(1)    2003(1)(2)   
Net asset value — Beginning of year (Common shares)   $ 15.470     $ 14.930     $ 14.410     $ 14.580     $ 14.325 (3)   
Income (loss) from operations  
Net investment income   $ 0.995     $ 0.994     $ 1.019     $ 1.068     $ 0.811    
Net realized and unrealized gain (loss)     (0.209 )     0.559       0.587       (0.066 )     0.331    
Distributions to preferred shareholders  
From net investment income     (0.291 )     (0.266 )     (0.173 )     (0.083 )     (0.060 )  
From net realized gain                       (0.011 )        
Total income from operations   $ 0.495     $ 1.287     $ 1.433     $ 0.908     $ 1.082    
Less distributions to common shareholders  
From net investment income   $ (0.695 )   $ (0.747 )   $ (0.913 )   $ (0.938 )   $ (0.681 )  
From net realized gain                       (0.140 )        
Total distributions to common shareholders   $ (0.695 )   $ (0.747 )   $ (0.913 )   $ (1.078 )   $ (0.681 )  
Preferred and Common shares offering costs
charged to paid-in capital
  $     $     $     $     $ (0.056 )  
Preferred shares underwriting discounts   $     $     $     $     $ (0.090 )  
Net asset value — End of year (Common shares)   $ 15.270     $ 15.470     $ 14.930     $ 14.410     $ 14.580    
Market value — End of year (Common shares)   $ 14.150     $ 15.020     $ 15.540     $ 14.980     $ 14.330    
Total Investment Return on Net Asset Value(4)      3.44 %     9.00 %     10.01 %     6.43 %     6.63 %(5)   
Total Investment Return on Market Value(4)      (1.28 )%     1.68 %     10.15 %     12.57 %     4.80 %(5)   

 

See notes to financial statements
64



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FINANCIAL STATEMENTS CONT'D

Financial Highlights

Selected data for a common share outstanding during the periods stated

    Insured Pennsylvania Fund  
    Year Ended September 30,  
    2007(1)    2006(1)    2005(1)    2004(1)    2003(1)(2)   
Ratios/Supplemental Data  
Net assets applicable to common shares, end of year (000's omitted)   $ 44,955     $ 45,516     $ 43,920     $ 42,352     $ 42,822    
Ratios (As a percentage of average net assets applicable to common shares):(6)  
Expenses excluding interest and fees     1.15 %(7)     1.18 %     1.16 %     1.12 %     1.03 %(8)  
Interest and fee expense(9)     0.83 %     0.78 %     0.41 %     0.25 %     0.14 %(8)  
Total expenses before custodian fee reduction     1.98 %(7)     1.96 %     1.57 %     1.37 %     1.17 %(8)  
Expenses after custodian fee reduction excluding interest and fees     1.12 %(7)     1.15 %     1.15 %     1.11 %     0.97 %(8)  
Net investment income     6.45 %     6.64 %     6.91 %     7.37 %     6.64 %(8)  
Portfolio Turnover     24 %     22 %     19 %     15 %     12 %  

 

The ratios reported above are based on net assets applicable solely to common shares. The ratios based on net assets, including amounts related to preferred shares, are as follows:

Ratios (As a percentage of average total net assets applicable to common shares and preferred shares):(6)  
Expenses excluding interest and fees     0.73 %(7)     0.74 %     0.73 %     0.69 %     0.68 %(8)  
Interest and fee expense(9)     0.53 %     0.49 %     0.26 %     0.15 %     0.09 %(8)  
Total expenses before custodian fee reduction     1.26 %(7)     1.23 %     0.99 %     0.84 %     0.77 %(8)  
Expenses after custodian fee reduction excluding interest and fees     0.71 %(7)     0.72 %     0.72 %     0.69 %     0.64 %(8)  
Net investment income     4.10 %     4.17 %     4.32 %     4.58 %     4.37 %(8)  
Senior Securities:  
Total preferred shares outstanding     1,040       1,040       1,040       1,040       1,040    
Asset coverage per preferred share(10)   $ 68,233     $ 68,770     $ 67,232     $ 65,723     $ 66,178    
Involuntary liquidation preference per preferred share(11)   $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000    
Approximate market value per preferred share(11)   $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000    

 

(1)  Per share net investment income was computed using average common shares outstanding.

(2)  For the period from the start of business, November 29, 2002, to September 30, 2003.

(3)  Net asset value at beginning of period reflects the deduction of the sales load of $0.675 per share paid by the shareholder from the $15.000 offering price.

(4)  Returns are historical and are calculated by determining the percentage change in net asset value or market value with all distributions reinvested.

(5)  Total investment return on net asset value is calculated assuming a purchase at the offering price of $15.000 less the sales load of $0.675 per share paid by the shareholder on the first day and sale at the net asset value on the last day of the period reported. Total investment return on market value is calculated assuming a purchase at the offering price of $15.000 less the sales load of $0.675 per share paid by the shareholder on the first day and a sale at the current market price on the last day of the period reported. Total investment return on net asset value and total investment return on market value are not computed on an annualized basis.

(6)  Ratios do not reflect the effect of dividend payments to preferred shareholders.

(7)  The investment adviser was allocated a portion of the Fund's operating expenses (equal to less than 0.01% of average daily net assets for the year ended September 30, 2007). Absent this allocation, total return would be lower.

(8)  Annualized.

(9)  Interest and fee expense relates to the liability for floating rate notes issued in conjunction with inverse floater securities transactions (See Note 1H).

(10)  Calculated by subtracting the Fund's total liabilities (not including the preferred shares) from the Fund's total assets, and dividing this by the number of preferred shares outstanding.

(11)  Plus accumulated and unpaid dividends.

See notes to financial statements
65




Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

NOTES TO FINANCIAL STATEMENTS

1  Significant Accounting Policies

Eaton Vance Insured Municipal Bond Fund II (Insured Municipal Fund II), Eaton Vance Insured California Municipal Bond Fund II (Insured California Fund II), Eaton Vance Insured Florida Municipal Bond Fund (Insured Florida Fund), Eaton Vance Insured Massachusetts Municipal Bond Fund (Insured Massachusetts Fund), Eaton Vance Insured Michigan Municipal Bond Fund (Insured Michigan Fund), Eaton Vance Insured New Jersey Municipal Bond Fund (Insured New Jersey Fund), Eaton Vance Insured New York Municipal Bond Fund II (Insured New York Fund II), Eaton Vance Insured Ohio Municipal Bond Fund (Insured Ohio Fund), and Eaton Vance Insured Pennsylvania Municipal Bond Fund (Insured Pennsylvania Fund) (each individually referred to as the Fund, and collectively, the Funds), are Massachusetts business trusts registered under the Investment Company Act of 1940, as amended (the 1940 Act), as non-diversified, closed-end management investment companies. Each Fund seeks to provide current income exempt from regular federal income tax, including alternative minimum tax, and, in state specific funds, taxes in its specified state, as applicable.

The following is a summary of significant accounting policies of the Funds. The policies are in conformity with accounting principles generally accepted in the United States of America.

A  Investment Valuation — Municipal bonds and taxable obligations, if any, are generally valued on the basis of valuations furnished by a pricing service. Financial futures contracts and options on financial futures contracts listed on commodity exchanges are valued at closing settlement prices. Interest rate swaps are generally valued on the basis of valuations furnished by a pricing service. Short-term obligations, maturing in sixty days or less, are valued at amortized cost, which approximates market value. Investments for which valuations or market quotations are not readily available, and investments for which the price of a security is not believed to represent its fair market value, are valued at fair value using methods determined in good faith by or at the direction of the Trustees.

B  Investment Transactions and Related Income — Investment transactions for financial statement purposes are accounted for on a trade date basis. Realized gains and losses on investments sold are determined on the basis of identified cost. Interest income is recorded on the basis of interest accrued, adjusted for amortization of premium or accretion of discount.

C  Federal Taxes — Each Fund's policy is to comply with the provisions of the Internal Revenue Code applicable to regulated investment companies and to distribute to shareholders each year substantially all of its taxable, if any, and tax-exempt net investment income, and all or substantially all of its net realized capital gains. Accordingly, no provision for federal income tax is necessary. Each Fund also seeks to avoid payments of federal excise tax. Each Fund intends to satisfy conditions which will enable it to designate distributions from the interest income generated by its investments in municipal obligations, which are exempt from regular federal income taxes when received by each Fund, as exempt-interest dividends.

At September 30, 2007, the following Funds, for federal income tax purposes, had capital loss carryforwards which will reduce each Fund's taxable income arising from future net realized gains on investment transactions, if any, to the extent permitted by the Internal Revenue Code, and thus will reduce the amount of distributions to shareholders which would otherwise be necessary to relieve the Funds of any liability for federal income or excise tax. The amounts and expiration dates of the capital loss carryforwards are as follows:

Fund   Amount   Expiration Date  
Insured Florida Fund   $ 314,751     September 30, 2013  
Insured Massachusetts Fund     247,959     September 30, 2013  
Insured Michigan Fund     399,841     September 30, 2013  
Insured Ohio Fund     321,978     September 30, 2013  

 

During the year ended September 30, 2007, capital loss carryforwards of $561,535, $1,015,681, $411,203, $303,657, $252,584, $390,483, $577,561 and $53,657 were utilized to offset net realized gains by the Insured Municipal Fund II, Insured California Fund II, Insured Florida Fund, Insured Massachusetts Fund, Insured Michigan Fund, Insured New Jersey Fund, Insured Ohio Fund and Insured Pennsylvania Fund, respectively.

D  Expense Reduction — State Street Bank and Trust Company (SSBT) serves as custodian of the Funds. Pursuant to the respective custodian agreements, SSBT receives a fee reduced by credits, which are determined based on the average daily cash balance each Fund maintains with SSBT. All credit balances, if any, used to reduce each Fund's custodian fees are reported as a reduction of expenses in the Statements of Operations.


66



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

NOTES TO FINANCIAL STATEMENTS CONT'D

E  Legal Fees — Legal fees and other related expenses incurred as part of negotiations of the terms and requirement of capital infusions, or that are expected to result in the restructuring of, or a plan of reorganization for, an investment are recorded as realized losses. Ongoing expenditures to protect or enhance an investment are treated as operating expenses.

F  Use of Estimates — The preparation of the financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of income and expense during the reporting period. Actual results could differ from those estimates.

G  Indemnifications — Under each Fund's organizational documents, its officers and Trustees may be indemnified against certain liabilities and expenses arising out of the performance of their duties to each Fund, and shareholders are indemnified against personal liability for the obligations of each Fund. Additionally, in the normal course of business, each Fund enters into agreements with service providers that may contain indemnification clauses. Each Fund's maximum exposure under these arrangements is unknown as this would involve future claims that may be made against each Fund that have not yet occurred.

H  Floating Rate Notes Issued in Conjunction with Securities Held — The Funds may invest in inverse floating rate securities, whereby a Fund may sell a fixed rate bond to a broker for cash. At the same time, the Fund buys a residual interest in the assets and cash flows of a Special Purpose Vehicle (which is generally organized as a trust), (the SPV) set up by the broker, often referred to as an inverse floating rate obligation (Inverse Floater). The broker deposits a fixed rate bond into the SPV with the same CUSIP number as the fixed rate bond sold to the broker by the Fund, and which may have been, but is not required to be, the fixed rate bond purchased from the Fund (the Fixed Rate Bond). The SPV also issues floating rate notes (Floating Rate Notes) which are sold to third-parties. The Funds may enter into shortfall and forbearance agreements with the broker by which a Fund agrees to reimburse the broker, in certain circumstances, for the difference between the liquidation value of the Fixed Rate Bond held by the SPV and the liquidation value of the Floating Rate Notes, as well as any shortfalls in interest cash flows. The Inverse Floater held by a Fund gives the Fund the right (1) to cause the holders of the Floating Rate Notes to tender their notes at par, and (2) to have the broker transfer the Fixed Rate Bond held by the SPV to the Fund, thereby collapsing the SPV. Pursuant to Financial Accounting Standards Board (FASB) Statement No. 140, "Accounting for Transfers and Servicing of Financial Assets and Extinguishment of Liabilities" (FAS 140), the Funds account for the transaction described above as a secured borrowing by including the Fixed Rate Bond in their Portfolio of Investments, and the Floating Rate Notes as a liability under the caption "Payable for floating rate notes issued" in their Statement of Assets and Liabilities. The Floating Rate Notes have interest rates that generally reset weekly and their holders have the option to tender their notes to the broker for redemption at par at each reset date. Interest expense related to the Funds' liability with respect to Floating Rate Notes is recorded as incurred. At September 30, 2007, the amount of the Funds' Floating Rate Notes and related interest rates and collateral were as follows:

Fund   Floating
Rate Notes
Outstanding
  Interest Rate
or Range of
Interest
Rates
  Collateral for
Floating Rate
Notes
Outstanding
 
Insured Municipal Fund II   $ 39,570,000     3.89% - 3.93%   $ 62,130,526    
Insured California Fund II     7,550,000     3.89%     11,990,725    
Insured Florida Fund     4,385,000     3.88% - 3.91%     6,988,547    
Insured Massachusetts Fund     6,765,000     3.88% - 3.90%     10,834,849    
Insured Michigan Fund     5,780,000     3.88% - 3.92%     9,144,956    
Insured New Jersey Fund     9,580,000     3.88% - 3.90%     15,146,324    
Insured New York Fund II     4,665,000     3.88% - 3.90%     7,401,115    
Insured Ohio Fund     4,905,000     3.87% - 3.92%     7,675,490    
Insured Pennsylvania Fund     8,495,000     3.87% - 3.95%     13,704,807    

 

The Funds' investment policies and restrictions expressly permit investments in Inverse Floaters. Inverse floating rate securities typically offer the potential for yields exceeding the yields available on fixed rate bonds with comparable credit quality and maturity. The Funds' investment policies do not allow the Funds to borrow money for purposes of making investments. Management believes that the Funds' restrictions on borrowings do not apply to the secured borrowings deemed to have occurred for accounting purposes pursuant to FAS 140, which is distinct from a legal borrowing of the Funds to which the policies apply. Inverse Floaters held by the Funds are securities exempt from registration under Rule 144A of the Securities Act of 1933.


67



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

NOTES TO FINANCIAL STATEMENTS CONT'D

I  Financial Futures Contracts — The Funds may enter into financial futures contracts. The Funds' investment in financial futures contracts is designed for hedging against changes in interest rates or as a substitute for the purchase of securities. Upon entering into a financial futures contract, a Fund is required to deposit with the broker, either in cash or securities an amount equal to a certain percentage of the purchase price (initial margin). Subsequent payments, known as variation margin, are made or received by the Fund each business day, depending on the daily fluctuations in the value of the underlying security, and are recorded as unrealized gains or losses by the Fund. Gains (losses) are realized upon the expiration or closing of the financial futures contracts. Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the financial futures contracts and may realize a loss. In entering such contracts, the Fund bears the risk if the counterparties do not perform under the contracts' terms.

J  Interest Rate Swaps — A Fund may enter into interest rate swap agreements to enhance return, to hedge against fluctuations in securities prices or interest rates, or as substitution for the purchase or sale of securities. Pursuant to these agreements, a Fund makes periodic payments at a fixed interest rate and, in exchange, receives payments based on the interest rate of a benchmark industry index. During the term of the outstanding swap agreement, changes in the underlying value of the swap are recorded as unrealized gains or losses. The value of the swap is determined by changes in the relationship between two rates of interest. A Fund is exposed to credit loss in the event of non-performance by the swap counterparty. Risk may also arise from movements in interest rates.

K  When-Issued Securities and Delayed Delivery Transactions — The Funds may purchase or sell securities on a delayed delivery or when-issued basis. Payment and delivery may take place after the customary settlement period for that security. At the time the transaction is negotiated, the price of the security that will be delivered is fixed. The Funds maintain security positions for these commitments such that sufficient liquid assets will be available to make payments upon settlement. Securities purchased on a delayed delivery or when-issued basis are marked-to-market daily and begin earning interest on settlement date. Losses may arise due to changes in the market value of the underlying securities or if the counterparty does not perform under the contract.

L  Statement of Cash Flows — The cash amount shown in the Statement of Cash Flows of a Fund is the amount included in the Fund's Statement of Assets and Liabilities and represents cash on hand at its custodian and does not include any short-term investments.

2  Auction Preferred Shares

Each Fund issued Auction Preferred Shares (APS) on January 15, 2003 in a public offering. The underwriting discounts and other offering costs incurred in connection with the offering were recorded as a reduction of the paid-in capital of the common shares of each respective Fund. Dividends on the APS, which accrue daily, are cumulative at rates which are reset every seven days by an auction, unless a special dividend period has been set. Series of APS are identical in all respects except for the reset dates of the dividend rates.

The number of APS issued and outstanding as of September 30, 2007 are as follows:

Fund   APS
Issued and Outstanding
 
Insured Municipal Fund II  
Series A     1,750    
Series B     1,750    
Insured California Fund II     1,350    
Insured Florida Fund     900    
Insured Massachusetts Fund     620    
Insured Michigan Fund     540    
Insured New Jersey Fund     900    
Insured New York Fund II     900    
Insured Ohio Fund     875    
Insured Pennsylvania Fund     1,040    

 

The APS are redeemable at the option of each Fund at a redemption price equal to $25,000 per share, plus accumulated and unpaid dividends, on any dividend payment date. The APS are also subject to mandatory redemption at a redemption price equal to $25,000 per share, plus accumulated and unpaid dividends, if a Fund is in default for an extended period on its asset maintenance requirements with respect to the APS. If the dividends on the APS remain unpaid in an amount equal to two full years' dividends, the holders of the APS as a class have the right to elect a majority of the Board


68



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

NOTES TO FINANCIAL STATEMENTS CONT'D

of Trustees. In general, the holders of the APS and the common shares have equal voting rights of one vote per share, except that the holders of the APS, as a separate class, have the right to elect at least two members of the Board of Trustees. The APS have a liquidation preference of $25,000 per share, plus accumulated and unpaid dividends. Each Fund is required to maintain certain asset coverage with respect to the APS as defined in the Funds' By-Laws and the 1940 Act. Each Fund pays an annual fee equivalent to 0.25% of the liquidation value of the APS for the remarketing efforts associated with the APS auctions.

3  Distributions to Shareholders

Each Fund intends to make monthly distributions of net investment income to common shareholders, after payment of any dividends on any outstanding APS. In addition, at least annually, the Funds intend to distribute all or substantially all of their net realized capital gains, if any. Distributions to common shareholders are recorded on the ex-dividend date. Distributions to preferred shareholders are recorded daily and are payable at the end of each dividend period. The dividend rates for APS at September 30, 2007, and the amount of dividends (including capital gains, if any) paid to APS shareholders, average APS dividend rates, and dividend rate ranges for the year then ended were as follows:

Fund   APS Dividend
Rates at
September 30,
2007
  Dividends
Paid to
APS
Shareholders
  Average
APS
Dividend
Rates
  Dividends
Rate
Ranges
 
Insured Municipal Fund II  
Series A     3.75 %   $ 1,495,446       3.42 %   3.00% - 4.00%  
Series B     3.60 %     1,513,920       3.47 %   2.98% - 4.10%  
Insured California Fund II     3.70 %     1,088,414       3.22 %   2.00% - 3.85%  
Insured Florida Fund     3.75 %     797,008       3.54 %   3.10% - 4.00%  
Insured Massachusetts Fund     3.65 %     514,151       3.32 %   2.11% - 4.00%  
Insured Michigan Fund     3.55 %     435,251       3.22 %   2.11% - 4.00%  
Insured New Jersey Fund     3.70 %     732,552       3.26 %   2.10% - 3.95%  
Insured New York Fund II     3.20 %     735,829       3.27 %   2.00% - 4.70%  
Insured Ohio Fund     3.60 %     756,723       3.46 %   3.20% - 3.85%  
Insured Pennsylvania Fund     3.50 %     856,964       3.30 %   2.10% - 4.00%  

 

The Funds distinguish between distributions on a tax basis and a financial reporting basis. Accounting principles generally accepted in the United States of America require that only distributions in excess of tax basis earnings and profits be reported in the financial statements as a return of capital. Permanent differences between book and tax accounting relating to distributions are reclassified to paid-in capital.

The tax character of distributions paid for the years ended September 30, 2007 and September 30, 2006 was as follows:

Year Ended September 30, 2007   Insured
Municipal
Fund II
  Insured
California
Fund II
  Insured
Florida
Fund
  Insured
Massachusetts
Fund
  Insured
Michigan
Fund
 
Distributions declared from:  
Tax-exempt income   $ 10,474,981     $ 3,824,580     $ 2,491,480     $ 1,717,836     $ 1,445,151    
Ordinary income   $ 499                            
Year Ended September 30, 2007   Insured
New Jersey
Fund
  Insured
New York
Fund II
  Insured
Ohio
Fund
  Insured
Pennsylvania
Fund
 
Distributions declared from:  
Tax-exempt income   $2,553,421   $2,315,728   $2,426,478   $2,902,463  
Long-term capital gains             $ 775,353                
Short-term capital gains             $ 59,759                

 


69



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

NOTES TO FINANCIAL STATEMENTS CONT'D

Year Ended September 30, 2006   Insured
Municipal
Fund II
  Insured
California
Fund II
  Insured
Florida
Fund
  Insured
Massachusetts
Fund
  Insured
Michigan
Fund
 
Distributions declared from:  
Tax-exempt income   $ 11,047,959     $ 3,921,582     $ 2,596,229     $ 1,848,911     $ 1,547,517    

 

Year Ended September 30, 2006   Insured
New Jersey
Fund
  Insured
New York
Fund II
  Insured
Ohio
Fund
  Insured
Pennsylvania
Fund
 
Distributions declared from:  
Tax-exempt income   $ 2,749,009     $ 2,482,872     $ 2,449,953     $ 2,983,088    
Ordinary income   $ 808                      
Long-term capital gains         $ 255,263                

 

During the year ended September 30, 2007, the following amounts were reclassified due to differences between book and tax accounting, primarily for accretion of market discount and non-deductible expenses:

    Insured
Municipal
Fund II
  Insured
California
Fund II
  Insured
Florida
Fund
  Insured
Massachusetts
Fund
  Insured
Michigan
Fund
 
Increase (decrease):  
Accumulated net realized gain (loss)   $ 66,853     $ 17,596     $ 9,567     $ 6,516     $ 5,366    
Accumulated undistributed net investment income   $ (66,853 )   $ (17,596 )   $ (9,567 )   $ (6,516 )   $ (5,366 )  

 

    Insured
New Jersey
Fund
  Insured
New York
Fund II
  Insured
Ohio
Fund
  Insured
Pennsylvania
Fund
 
Increase (decrease):  
Paid-in capital         $ (2,432 )              
Accumulated net realized gain (loss)   $ 18,228     $ 463     $ 20,739     $ 9,012    
Accumulated undistributed net investment income   $ (18,228 )   $ 1,969     $ (20,739 )   $ (9,012 )  

 

These reclassifications had no effect on the net assets or net asset value per share of the Funds.

As of September 30, 2007, the components of distributable earnings (accumulated losses) and unrealized appreciation (depreciation) on a tax basis were as follows:

    Insured
Municipal
Fund II
  Insured
California
Fund II
  Insured
Florida
Fund
  Insured
Massachusetts
Fund
  Insured
Michigan
Fund
 
Undistributed income   $ 58,462     $ 53,921     $ 61,163     $ 23,924     $ 79,406    
Undistributed long-term capital gains   $ 3,999,452     $ 707,117                      
Capital loss carryforwards               $ (314,751 )   $ (247,959 )   $ (399,841 )  
Unrealized appreciation (depreciation)   $ 8,696,354     $ 2,479,214     $ 1,812,516     $ 1,828,084     $ 1,810,015    
Other temporary differences   $ (17,980 )   $ (13,685 )   $ (13,870 )   $ (4,650 )   $ (6,565 )  

 

    Insured
New Jersey
Fund
  Insured
New York
Fund II
  Insured
Ohio
Fund
  Insured
Pennsylvania
Fund
 
Undistributed income   $ 57,493     $ 333,676     $ 13,950     $ 68,451    
Undistributed long-term capital gains   $ 1,016,816     $ 583,207     $     $ 751,190    
Capital loss carryforwards   $     $     $ (321,978 )   $    
Unrealized appreciation (depreciation)   $ 2,810,281     $ 1,806,802     $ 2,286,212     $ 2,397,309    
Other temporary differences   $ (13,685 )   $ (9,861 )   $     $ (7,479 )  

 

The differences between components of distributable earnings (accumulated losses) on a tax basis and the amounts reflected in the Statement of Assets and Liabilities are primarily due to wash sales, dividends payable, and differences between book and tax accounting for futures contracts, accretion of market discount and inverse floaters.


70



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

NOTES TO FINANCIAL STATEMENTS CONT'D

4  Investment Adviser Fee and Other Transactions with Affiliates

The investment adviser fee is earned by Eaton Vance Management (EVM) as compensation for investment advisory services rendered to each Fund. The fee is computed at an annual rate of 0.55% of each Fund's average weekly gross assets and is payable monthly. Average weekly gross assets as referred to herein exclude assets deemed held pursuant to FAS 140 (see Note 1H). EVM also serves as the administrator of each Fund, but receives no compensation.

EVM has contractually agreed to reimburse each Fund for fees and other expenses at an annual rate of 0.15% of average weekly gross assets of each Fund during the first five full years of its operations, 0.10% of a Fund's average weekly gross assets in year six, and 0.05% in year seven. In addition, pursuant to a voluntary expense reimbursement, EVM was allocated certain operating expenses of the Funds. For the year ended September 30, 2007, the investment adviser fee, expenses contractually reduced by EVM and expenses allocated to EVM were as follows:

Fund   Investment
Adviser
Fee
  Expenses
Reduced by
EVM
  Allocation of
Expenses to
EVM
 
Insured Municipal Fund II   $ 1,344,894     $ 366,789     $ 6,321    
Insured California Fund II     509,888       139,060       5,103    
Insured Florida Fund     337,595       92,071       3,815    
Insured Massachusetts Fund     234,186       63,869       4,650    
Insured Michigan Fund     201,629       54,990       3,433    
Insured New Jersey Fund     346,998       93,945       3,815    
Insured New York Fund II     342,008       93,275       3,348    
Insured Ohio Fund     331,168       90,319       3,832    
Insured Pennsylvania Fund     392,766       106,335       6,263    

 

Except for Trustees of the Funds who are not members of EVM's organization, officers and Trustees receive remuneration for their services to the Funds out of the investment adviser fee. Certain officers and one Trustee of the Funds are officers of EVM.

During the year ended September 30, 2007, the Insured Massachusetts Fund realized a gain of $20,473 due to the sale of an investment security not meeting investment guidelines.

During the year ended September 30, 2007, the Insured Municipal Fund II realized a loss of $1,695 due to the sale of an investment security not meeting investment guidelines, and was reimbursed for such loss by EVM.

5  Purchase and Sales of Investments  

Purchases and sales of investments, other than short-term obligations, for the year ended September 30, 2007 were as follows:

Fund   Purchases   Sales  
Insured Municipal Fund II   $ 86,860,586     $ 90,818,853    
Insured California Fund II     37,076,908       38,869,053    
Insured Florida Fund     21,082,351       21,197,351    
Insured Massachusetts Fund     7,321,506       10,959,195    
Insured Michigan Fund     2,459,789       2,652,162    
Insured New Jersey Fund     19,495,030       19,343,532    
Insured New York Fund II     25,159,366       25,475,634    
Insured Ohio Fund     19,588,606       19,877,672    
Insured Pennsylvania Fund     19,463,578       21,490,909    

 

6  Common Shares

Common shares issued pursuant to the Funds' dividend reinvestment plan for the years ended September 30, 2007 and September 30, 2006 were as follows:

    Year Ended September 30,  
Fund   2007   2006  
Insured Municipal Fund II     1,599       4,301    
Insured California Fund II           522    
Insured Florida Fund           1,642    
Insured Massachusetts Fund     1,147       2,419    
Insured Michigan Fund           620    
Insured New Jersey Fund     1,531       2,951    
Insured New York Fund II     359          
Insured Ohio Fund     186          
Insured Pennsylvania Fund           975    

 

7  Federal Income Tax Basis of Unrealized Appreciation (Depreciation)

The cost and unrealized appreciation (depreciation) of investments of each Fund at September 30, 2007, as determined on a Federal income tax basis, were as follows:

Insured Municipal Fund II  
Aggregate cost   $ 230,327,426    
Gross unrealized appreciation   $ 9,618,750    
Gross unrealized depreciation     (961,234 )  
Net unrealized appreciation   $ 8,657,516    

 


71



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

NOTES TO FINANCIAL STATEMENTS CONT'D

Insured California Fund II  
Aggregate cost   $ 87,747,476    
Gross unrealized appreciation   $ 3,050,031    
Gross unrealized depreciation     (595,048 )  
Net unrealized appreciation   $ 2,454,983    
Insured Florida Fund  
Aggregate cost   $ 57,932,113    
Gross unrealized appreciation   $ 2,049,317    
Gross unrealized depreciation     (250,339 )  
Net unrealized appreciation   $ 1,798,978    
Insured Massachusetts Fund  
Aggregate cost   $ 39,734,770    
Gross unrealized appreciation   $ 2,033,251    
Gross unrealized depreciation     (216,493 )  
Net unrealized appreciation   $ 1,816,758    
Insured Michigan Fund  
Aggregate cost   $ 34,276,925    
Gross unrealized appreciation   $ 1,855,988    
Gross unrealized depreciation     (49,817 )  
Net unrealized appreciation   $ 1,806,171    
Insured New Jersey Fund  
Aggregate cost   $ 59,861,360    
Gross unrealized appreciation   $ 2,888,589    
Gross unrealized depreciation     (94,851 )  
Net unrealized appreciation   $ 2,793,738    
Insured New York Fund II  
Aggregate cost   $ 59,156,074    
Gross unrealized appreciation   $ 1,993,712    
Gross unrealized depreciation     (200,804 )  
Net unrealized appreciation   $ 1,792,908    
Insured Ohio Fund  
Aggregate cost   $ 56,469,232    
Gross unrealized appreciation   $ 2,605,423    
Gross unrealized depreciation     (327,620 )  
Net unrealized appreciation   $ 2,277,803    
Insured Pennsylvania Fund  
Aggregate cost   $ 67,725,569    
Gross unrealized appreciation   $ 2,520,900    
Gross unrealized depreciation     (181,644 )  
Net unrealized appreciation   $ 2,339,256    

 

8  Overdraft Advances

Pursuant to the respective custodian agreements, SSBT may, in its discretion, advance funds to the Funds to make properly authorized payments. When such payments result in an overdraft, the Funds are obligated to repay SSBT at the current rate of interest charged by SSBT for secured loans (currently, a rate above the Federal Funds rate). This obligation is payable on demand to SSBT. SSBT has a lien on a Fund's assets to the extent of any overdraft. At September 30, 2007, the Insured Michigan Fund had a payment due to SSBT pursuant to the foregoing arrangement of $91,245.

9  Financial Instruments

The Funds may trade in financial instruments with off-balance sheet risk in the normal course of their investing activities to assist in managing exposure to various market risks. These financial instruments may include financial futures contracts and interest rate swaps and may involve, to a varying degree, elements of risk in excess of the amounts recognized for financial statement purposes. The notional or contractual amounts of these instruments represent the investment a Fund has in particular classes of financial instruments and does not necessarily represent the amounts potentially subject to risk. The measurement of the risks associated with these instruments is meaningful only when all related and offsetting transactions are considered.


72



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

NOTES TO FINANCIAL STATEMENTS CONT'D

A summary of obligations under these financial instruments at September 30, 2007 is as follows:

Futures Contracts

Fund   Expiration
Date
  Contracts   Position   Aggregate
Cost
  Value   Net Unrealized
Appreciation
(Depreciation)
 
Insured
Municipal
Fund II
 
12/07
  374
U.S. Treasury Bond
 
Short
  $ (41,703,534 )   $ (41,642,562 )   $ 60,972    
Insured
California
Fund II
 
12/07
  42
U.S. Treasury Bond
 
Short
  $ (4,695,650 )   $ (4,676,438 )   $ 19,212    
Insured
Florida
Fund
 
12/07
  25
U.S. Treasury Bond
 
Short
  $ (2,793,225 )   $ (2,783,594 )   $ 9,631    
Insured
Massachusetts
Fund
 
12/07
  15
U.S. Treasury Bond
 
Short
  $ (1,677,067 )   $ (1,670,156 )   $ 6,911    
Insured
Michigan
Fund
 
12/07
  10
U.S. Treasury Bond
 
Short
  $ (1,116,841 )   $ (1,113,438 )   $ 3,403    
Insured
New Jersey
Fund
 
12/07
  25
U.S. Treasury Bond
 
Short
  $ (2,795,112 )   $ (2,783,594 )   $ 11,518    
Insured
New York
Fund II
 
12/07
  26
U.S. Treasury Bond
 
Short
  $ (2,904,954 )   $ (2,894,938 )   $ 10,016    
Insured
Ohio Fund
 
12/07
  83
U.S. Treasury Bond
 
Short
  $ (9,273,507 )   $ (9,241,531 )   $ 31,976    
Insured
Pennsylvania
Fund
 
12/07
  75
U.S. Treasury Bond
 
Short
  $ (8,341,069 )   $ (8,350,781 )   $ (9,712 )  

 

Interest Rate Swaps

Insured Municipal Fund II



Counterparty
  Notional
Amount
  Annual
Fixed Rate
Paid By Fund
  Floating
Rate
Paid To Fund
  Effective Date/
Termination
Date
  Net Unrealized
Appreciation
(Depreciation)
 
Lehman Brothers, Inc.   $ 6,000,000       5.503 %   3-month
USD-LIBOR-BBA
  September 28, 2008/
September 28, 2038
  $ (16,421 )  
Merrill Lynch
Capital Services, Inc.
  $ 4,550,000       5.426 %   3-month
USD-LIBOR-BBA
  July 9, 2008/
July 9, 2038
  $ 25,722    
Morgan Stanley
Capital Services, Inc.
  $ 4,150,000       5.428 %   3-month
USD-LIBOR-BBA
  September 10, 2008/
September 10, 2038
  $ 29,537    
    $ 38,838    

 

Insured California Fund II

Counterparty   Notional
Amount
  Annual
Fixed Rate
Paid By Fund
  Floating
Rate
Paid To Fund
  Effective Date/
Termination
Date
  Net Unrealized
Appreciation
(Depreciation)
 
Lehman Brothers, Inc.   $ 2,275,000       5.503 %   3-month
USD-LIBOR-BBA
  September 28, 2008/
September 28, 2038
  $ (6,226 )  
Merrill Lynch
Capital Services, Inc.
  $ 3,625,000       5.426 %   3-month
USD-LIBOR-BBA
  July 9, 2008/
July 9, 2038
  $ 20,493    
Morgan Stanley
Capital Services, Inc.
  $ 1,400,000       5.428 %   3-month
USD-LIBOR-BBA
  September 10, 2008/
September 10, 2038
  $ 9,964    
    $ 24,231    

 

Insured Florida Fund

Counterparty   Notional
Amount
  Annual
Fixed Rate
Paid By Fund
  Floating
Rate
Paid To Fund
  Effective Date/
Termination
Date
  Net Unrealized
Appreciation
(Depreciation)
 
Lehman Brothers, Inc.   $ 1,525,000       5.503 %   3-month
USD-LIBOR-BBA
  September 28, 2008/
September 28, 2038
  $ (4,174 )  
Merrill Lynch
Capital Services, Inc.
  $ 2,000,000       5.426 %   3-month
USD-LIBOR-BBA
  July 9, 2008/
July 9, 2038
  $ 11,306    
Morgan Stanley
Capital Services, Inc.
  $ 900,000       5.428 %   3-month
USD-LIBOR-BBA
  September 10, 2008/
September 10, 2038
  $ 6,406    
    $ 13,538    

 

Insured Massachusetts Fund

Counterparty   Notional
Amount
  Annual
Fixed Rate
Paid By Fund
  Floating
Rate
Paid To Fund
  Effective Date/
Termination
Date
  Net Unrealized
Appreciation
(Depreciation)
 
Lehman Brothers, Inc.   $ 1,050,000       5.503 %   3-month
USD-LIBOR-BBA
  September 28, 2008/
September 28, 2038
  $ (2,874 )  
Merrill Lynch
Capital Services, Inc.
  $ 1,725,000       5.426 %   3-month
USD-LIBOR-BBA
  July 9, 2008/
July 9, 2038
  $ 9,752    
Morgan Stanley
Capital Services, Inc.
  $ 625,000       5.428 %   3-month
USD-LIBOR-BBA
  September 10, 2008/
September 10, 2038
  $ 4,448    
    $ 11,326    

 

Insured Michigan Fund

Counterparty   Notional
Amount
  Annual
Fixed Rate
Paid By Fund
  Floating
Rate
Paid To Fund
  Effective Date/
Termination
Date
  Net Unrealized
Appreciation
(Depreciation)
 
Lehman Brothers, Inc.   $ 900,000       5.503 %   3-month
USD-LIBOR-BBA
  September 28, 2008/
September 28, 2038
  $ (2,463 )  
Merrill Lynch
Capital Services, Inc.
  $ 675,000       5.426 %   3-month
USD-LIBOR-BBA
  July 9, 2008/
July 9, 2038
  $ 3,816    
Morgan Stanley
Capital Services, Inc.
  $ 350,000       5.428 %   3-month
USD-LIBOR-BBA
  September 10, 2008/
September 10, 2038
  $ 2,491    
    $ 3,844    

 


73



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

NOTES TO FINANCIAL STATEMENTS CONT'D

Insured New Jersey Fund

Counterparty   Notional
Amount
  Annual
Fixed Rate
Paid By Fund
  Floating
Rate
Paid To Fund
  Effective Date/
Termination
Date
  Net Unrealized
Appreciation
(Depreciation)
 
Lehman Brothers, Inc.   $ 1,525,000       5.503 %   3-month
USD-LIBOR-BBA
  September 28, 2008/
September 28, 2038
  $ (4,174 )  
Merrill Lynch
Capital Services, Inc.
  $ 2,500,000       5.426 %   3-month
USD-LIBOR-BBA
  July 9, 2008/
July 9, 2038
  $ 14,133    
Morgan Stanley
Capital Services, Inc.
  $ 925,000       5.428 %   3-month
USD-LIBOR-BBA
  September, 10, 2008/
September, 10, 2038
  $ 6,584    
    $ 16,543    

 

Insured New York Fund II

Counterparty   Notional
Amount
  Annual
Fixed Rate
Paid By Fund
  Floating
Rate
Paid To Fund
  Effective Date/
Termination
Date
  Net Unrealized
Appreciation
(Depreciation)
 
Lehman Brothers, Inc.   $ 1,525,000       5.503 %   3-month
USD-LIBOR-BBA
  September 28, 2008/
September 28, 2038
  $ (4,174 )  
Merrill Lynch
Capital Services, Inc.
  $ 2,000,000       5.426 %   3-month
USD-LIBOR-BBA
  July 9, 2008/
July 9, 2038
  $ 11,306    
Morgan Stanley
Capital Services, Inc.
  $ 950,000       5.428 %   3-month
USD-LIBOR-BBA
  September 10, 2008/
September 10, 2038
  $ 6,762    
    $ 13,894    

 

Insured Ohio Fund

Counterparty   Notional
Amount
  Annual
Fixed Rate
Paid By Fund
  Floating
Rate
Paid To Fund
  Effective Date/
Termination
Date
  Net Unrealized
Appreciation
(Depreciation)
 
Lehman Brothers, Inc.   $ 1,475,000       5.503 %   3-month
USD-LIBOR-BBA
  September 28, 2008/
September 28, 2038
  $ (4,037 )  
Merrill Lynch
Capital Services, Inc.
  $ 1,100,000       5.426 %   3-month
USD-LIBOR-BBA
  July 9, 2008/
July 9, 2038
  $ 6,218    
Morgan Stanley
Capital Services, Inc.
  $ 875,000       5.428 %   3-month
USD-LIBOR-BBA
  September 10, 2008/
September 10, 2038
  $ 6,228    
    $ 8,409    

 

Insured Pennsylvania Fund

Counterparty   Notional
Amount
  Annual
Fixed Rate
Paid By Fund
  Floating
Rate
Paid To Fund
  Effective Date/
Termination
Date
  Net Unrealized
Appreciation
(Depreciation)
 
Lehman Brothers, Inc.   $ 2,000,000       3.896 %   USD-BMA
Municipal
Swap Index
  October 23, 2007/
October 23, 2037
  $ 54,548    
Lehman Brothers, Inc.   $ 1,450,000       5.503 %   3-month
USD-LIBOR-BBA
  September 28, 2008/
September 28, 2038
  $ (3,968 )  
Morgan Stanley
Capital Services, Inc.
  $ 1,050,000       5.428 %   3-month
USD-LIBOR-BBA
  September 10, 2008/
September 10, 2038
  $ 7,473    
    $ 58,053    

 

The effective date represents the date on which the Fund and the counterparty to the interest rate swap contract begin interest payment accruals.

At September 30, 2007, the Funds had sufficient cash and/or securities to cover commitments under these contracts.

10  Recently Issued Accounting Pronouncements

In June 2006, the FASB issued FASB Interpretation No. 48 (FIN 48), "Accounting for Uncertainty in Income Taxes – an interpretation of FASB Statement No. 109". FIN 48 clarifies the accounting for uncertainty in income taxes recognized in accordance with FASB Statement No. 109, "Accounting for Income Taxes". This interpretation prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. It also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. FIN 48 is effective on the last business day of the first required financial reporting period for fiscal years beginning after December 15, 2006. Management is currently evaluating the impact of applying the various provisions of FIN 48.

In September 2006, the FASB issued Statement of Financial Accounting Standards No. 157 (FAS 157), "Fair Value Measurements". FAS 157 defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles and expands disclosure about fair value measurements. FAS 157 is effective for fiscal years beginning after November 15, 2007. Management is currently evaluating the impact the adoption of FAS 157 will have on the Funds' financial statement disclosures.


74




Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Trustees and Shareholders of Eaton Vance Insured Municipal Bond Fund II, Eaton Vance Insured California Municipal Bond Fund II, Eaton Vance Insured Florida Municipal Bond Fund, Eaton Vance Insured Massachusetts Municipal Bond Fund, Eaton Vance Insured Michigan Municipal Bond Fund, Eaton Vance Insured New Jersey Municipal Bond Fund, Eaton Vance Insured New York Municipal Bond Fund II, Eaton Vance Insured Ohio Municipal Bond Fund, and Eaton Vance Insured Pennsylvania Municipal Bond Fund:

We have audited the accompanying statements of assets and liabilities, including the portfolios of investments, of Eaton Vance Insured Municipal Bond Fund II, Eaton Vance Insured California Municipal Bond Fund II, Eaton Vance Insured Florida Municipal Bond Fund, Eaton Vance Insured Massachusetts Municipal Bond Fund, Eaton Vance Insured Michigan Municipal Bond Fund, Eaton Vance Insured New Jersey Municipal Bond Fund, Eaton Vance Insured New York Municipal Bond Fund II, Eaton Vance Insured Ohio Municipal Bond Fund, and Eaton Vance Insured Pennsylvania Municipal Bond Fund (individually, the "Fund," collectively, the "Funds") as of September 30, 2007, and the related statements of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for each of the four years in the period then ended and for the period from the start of business, November 29, 2002, to September 30, 2003 and the statements of cash flows of Eaton Vance Insured Municipal Bond Fund II, Eaton Vance Insured Massachusetts Bond Fund, Eaton Vance Insured Michigan Bond Fund, Eaton Vance Insured New Jersey Bond Fund, and Eaton Vance Insured Pennsylvania Bond Fund for the year ended September 30, 2007. These financial statements and financial highlights are the responsibility of each Fund's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. The Funds are not required to have, nor were we engaged to perform, an audit of their internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Funds' internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned at September 30, 2007 by correspondence with the custodian and brokers; where replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Eaton Vance Insured Municipal Bond Fund II, Eaton Vance Insured California Municipal Bond Fund II, Eaton Vance Insured Florida Municipal Bond Fund, Eaton Vance Insured Massachusetts Municipal Bond Fund, Eaton Vance Insured Michigan Municipal Bond Fund, Eaton Vance Insured New Jersey Municipal Bond Fund, Eaton Vance Insured New York Municipal Bond Fund II, Eaton Vance Insured Ohio Municipal Bond Fund, and Eaton Vance Insured Pennsylvania Municipal Bond Fund as of September 30, 2007, the results of their operations for the year then ended, the changes in their net assets for each of the two years in the period then ended, their financial highlights for each of the four years in the period then ended and for the period from the start of business, November 29, 2002, to September 30, 2003 and the cash flows of Eaton Vance Insured Municipal Bond Fund II, Eaton Vance Insured Massachusetts Bond Fund, Eaton Vance Insured Michigan Bond Fund, Eaton Vance Insured New Jersey Bond Fund, and Eaton Vance Insured Pennsylvania Bond Fund for the year ended September 30, 2007, in conformity with accounting principles generally accepted in the United States of America.

DELOITTE & TOUCHE LLP
Boston, Massachusetts
November 15, 2007


75



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

OTHER MATTERS (Unaudited)

Each Fund held its Annual Meeting of Shareholders on July 20, 2007. The following action was taken by the shareholders of each Fund:

Item 1: The election of Benjamin C. Esty, Thomas E. Faust Jr., Allen R. Freedman and James B. Hawkes as Class II Trustees of each Fund for a three-year term expiring in 2010, and the election of Heidi L. Steiger as a Class III Trustee of each Fund for a one-year term expiring in 2008:

    Nominee for Class II
Trustee Elected by
APS Shareholders
Benjamin C. Esty
  Nominee for Class II
Trustee Elected by
All Shareholders
Thomas E. Faust Jr.
  Nominee for Class II
Trustee Elected by
All Shareholders
Allen R. Freedman
  Nominee for Class II
Trustee Elected by
All Shareholders
James B. Hawkes
  Nominee for Class III
Trustee Elected by
All Shareholders
Heidi L. Steiger
 
California II Fund:  
For     1,130       3,676,056       3,682,656       3,676,656       3,677,256    
Withheld     2       44,707       38,107       44,107       43,507    
Florida Fund:  
For     818       2,324,956       2,324,956       2,324,956       2,324,956    
Withheld     1       178,096       178,096       178,096       178,096    
Massachusetts Fund:  
For     620       1,715,152       1,715,152       1,715,152       1,715,052    
Withheld     0       15,312       15,312       15,312       15,412    
Michigan Fund:  
For     468       1,462,771       1,464,371       1,462,371       1,464,764    
Withheld     4       18,087       16,487       18,487       16,094    
Municipal II Fund:  
For     1,752       9,063,467       9,045,230       9,057,662       9,063,299    
Withheld     7       106,371       124,608       112,176       106,539    
New Jersey Fund:  
For     836       2,494,509       2,494,105       2,494,109       2,492,509    
Withheld     1       9,472       9,876       9,872       11,472    
New York II Fund:  
For     834       2,462,040       2,462,040       2,462,040       2,461,367    
Withheld     40       25,607       25,607       25,607       26,280    
Ohio Fund:  
For     874       2,405,380       2,400,180       2,400,180       2,400,880    
Withheld     0       22,190       27,390       27,390       26,690    
Pennsylvania Fund:  
For     746       2,687,985       2,684,510       2,687,985       2,687,110    
Withheld     0       49,092       52,567       49,092       49,967    

 

Results are rounded to the nearest whole number.


76



Eaton Vance Insured Municipal Bond Funds as of September 30, 2007

FEDERAL TAX INFORMATION (Unaudited)

The Form 1099-DIV you receive in January 2008 will show the tax status of all distributions paid to your account in calendar 2007. Shareholders are advised to consult their own tax adviser with respect to the tax consequences of their investment in the Fund. As required by the Internal Revenue Code regulations, shareholders must be notified within 60 days of a Fund's fiscal year-end regarding exempt-interest dividends and capital gains dividends.

Exempt-Interest Dividends — The Funds designate the following amounts of dividends from net investment income as an exempt-interest dividend.

Eaton Vance Insured Municipal Bond Fund II     100.00 %  
Eaton Vance Insured California Municipal Bond Fund II     100.00 %  
Eaton Vance Insured Florida Municipal Bond Fund     100.00 %  
Eaton Vance Insured Massachusetts Municipal Bond Fund     100.00 %  
Eaton Vance Insured Michigan Municipal Bond Fund     100.00 %  
Eaton Vance Insured New Jersey Municipal Bond Fund     100.00 %  
Eaton Vance Insured New York Municipal Bond Fund II     100.00 %  
Eaton Vance Insured Ohio Municipal Bond Fund     100.00 %  
Eaton Vance Insured Pennsylvania Municipal Bond Fund     100.00 %  

 

Capital Gains Dividends — The Eaton Vance Insured New York Municipal Bond Fund II designates $775,353 as capital gain dividend.


77




Eaton Vance Insured Municipal Bond Funds

DIVIDEND REINVESTMENT PLAN

Each Fund offers a dividend reinvestment plan (the Plan) pursuant to which shareholders may elect to have dividends and capital gains distributions automatically reinvested in common shares (the Shares) of the same Fund. You may elect to participate in the Plan by completing the Dividend Reinvestment Plan Application Form. If you do not participate, you will receive all distributions in cash paid by check mailed directly to you by PFPC Inc. as dividend paying agent. On the distribution payment date, if the net asset value per Share is equal to or less than the market price per Share plus estimated brokerage commissions, then new Shares will be issued. The number of Shares shall be determined by the greater of the net asset value per Share or 95% of the market price. Otherwise, Shares generally will be purchased on the open market by the Plan Agent. Distributions subject to income tax (if any) are taxable whether or not shares are reinvested.

If your shares are in the name of a brokerage firm, bank, or other nominee, you can ask the firm or nominee to participate in the Plan on your behalf. If the nominee does not offer the Plan, you will need to request that your shares be re-registered in your name with each Fund's transfer agent, PFPC Inc., or you will not be able to participate.

The Plan Agent's service fee for handling distributions will be paid by each Fund. Each participant will be charged their pro rata share of brokerage commissions on all open-market purchases.

Plan participants may withdraw from the Plan at any time by writing to the Plan Agent at the address noted on the following page. If you withdraw, you will receive shares in your name for all Shares credited to your account under the Plan. If a participant elects by written notice to the Plan Agent to have the Plan Agent sell part or all of his or her Shares and remit the proceeds, the Plan Agent is authorized to deduct a $5.00 fee plus brokerage commissions from the proceeds.

If you wish to participate in the Plan and your shares are held in your own name, you may complete the form on the following page and deliver it to the Plan Agent.

Any inquiries regarding the Plan can be directed to the Plan Agent, PFPC Inc., at 1-800-331-1710.


78



Eaton Vance Insured Municipal Bond Funds

APPLICATION FOR PARTICIPATION IN DIVIDEND REINVESTMENT PLAN

This form is for shareholders who hold their common shares in their own names. If your common shares are held in the name of a brokerage firm, bank, or other nominee, you should contact your nominee to see if it will participate in the Plan on your behalf. If you wish to participate in the Plan, but your brokerage firm, bank, or nominee is unable to participate on your behalf, you should request that your common shares be re-registered in your own name which will enable your participation in the Plan.

The following authorization and appointment is given with the understanding that I may terminate it at any time by terminating my participation in the Plan as provided in the terms and conditions of the Plan.

  Please print exact name on account

  Shareholder signature  Date

  Shareholder signature  Date

  Please sign exactly as your common shares are registered. All persons whose names appear on the share certificate must sign.

YOU SHOULD NOT RETURN THIS FORM IF YOU WISH TO RECEIVE YOUR DIVIDENDS AND DISTRIBUTIONS IN CASH. THIS IS NOT A PROXY.

This authorization form, when signed, should be mailed to the following address:

Eaton Vance Insured Municipal Bond Funds
c/o PFPC Inc.
P.O. Box 43027
Providence, RI 02940-3027
800-331-1710

Number of Employees

Each Fund is organized as a Massachusetts business trust and is registered under the Investment Company Act of 1940, as amended, as a closed-end, nondiversified, management investment company and has no employees.

Number of Shareholders

As of September 30, 2007, our records indicate that there are 31, 10, 4, 51, 9, 9, 16, 12 and 44 registered shareholders for Insured Municipal Fund II, Insured California Fund II, Insured Florida Fund, Insured Massachusetts Fund, Insured Michigan Fund, Insured New Jersey Fund, Insured New York Fund II, Insured Ohio Fund and Insured Pennsylvania Fund, respectively, and approximately 5,074, 1,682, 1,462, 936, 1,019, 1,551, 1,340, 1,526 and 1,837 shareholders owning the Fund shares in street name, such as through brokers, banks, and financial intermediaries for Insured Municipal Fund II, Insured California Fund II, Insured Florida Fund, Insured Massachusetts Fund, Insured Michigan Fund, Insured New Jersey Fund, Insured New York Fund II, Insured Ohio Fund and Insured Pennsylvania Fund, respectively.

If you are a street name shareholder and wish to receive Fund reports directly, which contain important information about a Fund, please write or call:

Eaton Vance Distributors, Inc.
The Eaton Vance Building
255 State Street
Boston, MA 02109
1-800-225-6265

American Stock Exchange symbols  

Insured Municipal Fund II   EIV  
Insured California Fund II   EIA  
Insured Florida Fund   EIF  
Insured Massachusetts Fund   MAB  
Insured Michigan Fund   MIW  
Insured New Jersey Fund   EMJ  
Insured New York Fund II   NYH  
Insured Ohio Fund   EIO  
Insured Pennsylvania Fund   EIP  

 


79



Eaton Vance Insured Municipal Bond Funds

BOARD OF TRUSTEES' ANNUAL APPROVAL OF THE INVESTMENT ADVISORY AGREEMENTS

Overview of the Contract Review Process

The Investment Company Act of 1940, as amended (the "1940 Act"), provides, in substance, that each investment advisory agreement between a fund and its investment adviser will continue in effect from year to year only if its continuance is approved at least annually by the fund's board of trustees, including by a vote of a majority of the trustees who are not "interested persons" of the fund ("Independent Trustees"), cast in person at a meeting called for the purpose of considering such approval.

At a meeting of the Boards of Trustees (each a "Board") of the Eaton Vance group of mutual funds (the "Eaton Vance Funds") held on April 23, 2007, the Board, including a majority of the Independent Trustees, voted to approve continuation of existing advisory and sub-advisory agreements for the Eaton Vance Funds for an additional one-year period. In voting its approval, the Board relied upon the affirmative recommendation of the Special Committee of the Board, which is a committee comprised exclusively of Independent Trustees. Prior to making its recommendation, the Special Committee reviewed information furnished for a series of meetings of the Special Committee held in February, March and April 2007. Such information included, among other things, the following:

Information about Fees, Performance and Expenses

•  An independent report comparing the advisory and related fees paid by each fund with fees paid by comparable funds;

•  An independent report comparing each fund's total expense ratio and its components to comparable funds;

•  An independent report comparing the investment performance of each fund to the investment performance of comparable funds over various time periods;

•  Data regarding investment performance in comparison to relevant peer groups of funds and appropriate indices;

•  Comparative information concerning fees charged by each adviser for managing other mutual funds and institutional accounts using investment strategies and techniques similar to those used in managing the fund;

•  Profitability analyses for each adviser with respect to each fund;

Information about Portfolio Management

•  Descriptions of the investment management services provided to each fund, including the investment strategies and processes employed;

•  Information concerning the allocation of brokerage and the benefits received by each adviser as a result of brokerage allocation, including information concerning the acquisition of research through "soft dollar" benefits received in connection with the funds' brokerage, and the implementation of a soft dollar reimbursement program established with respect to the funds;

•  Data relating to portfolio turnover rates of each fund;

•  The procedures and processes used to determine the fair value of fund assets and actions taken to monitor and test the effectiveness of such procedures and processes;

Information about each Adviser

•  Reports detailing the financial results and condition of each adviser;

•  Descriptions of the qualifications, education and experience of the individual investment professionals whose responsibilities include portfolio management and investment research for the funds, and information relating to their compensation and responsibilities with respect to managing other mutual funds and investment accounts;

•  Copies of the Codes of Ethics of each adviser and its affiliates, together with information relating to compliance with and the administration of such codes;

•  Copies of or descriptions of each adviser's proxy voting policies and procedures;

•  Information concerning the resources devoted to compliance efforts undertaken by each adviser and its affiliates on behalf of the funds (including descriptions of various compliance programs) and their record of compliance with investment policies and restrictions, including policies with respect to market-timing, late trading and selective portfolio disclosure, and with policies on personal securities transactions;

•  Descriptions of the business continuity and disaster recovery plans of each adviser and its affiliates;

Other Relevant Information

•  Information concerning the nature, cost and character of the administrative and other non-investment management services provided by Eaton Vance Management and its affiliates;

•  Information concerning management of the relationship with the custodian, subcustodians and fund accountants by each adviser or the funds' administrator; and

•  The terms of each advisory agreement.


80



Eaton Vance Insured Municipal Bond Funds

BOARD OF TRUSTEES' ANNUAL APPROVAL OF THE INVESTMENT ADVISORY AGREEMENTS CONT'D

In addition to the information identified above, the Special Committee considered information provided from time to time by each adviser throughout the year at meetings of the Board and its committees. Over the course of the twelve-month period ended April 30, 2007, the Board met ten times and the Special Committee, the Audit Committee and the Governance Committee, each of which is a Committee comprised solely of Independent Trustees, met twelve, fourteen and eight times, respectively. At such meetings, the Trustees received, among other things, presentations by the portfolio managers and other investment professionals of each adviser relating to the investment performance of each fund and the investment strategies used in pursuing the fund's investment objective.

For funds that invest through one or more underlying portfolios, the Board considered similar information about the portfolio(s) when considering the approval of advisory agreements. In addition, in cases where the fund's investment adviser has engaged a sub-adviser, the Board considered similar information about the sub-adviser when considering the approval of any sub-advisory agreement.

The Special Committee was assisted throughout the contract review process by Goodwin Procter LLP, legal counsel for the Independent Trustees. The members of the Special Committee relied upon the advice of such counsel and their own business judgment in determining the material factors to be considered in evaluating each advisory and sub-advisory agreement and the weight to be given to each such factor. The conclusions reached with respect to each advisory and sub-advisory agreement were based on a comprehensive evaluation of all the information provided and not any single factor. Moreover, each member of the Special Committee may have placed varying emphasis on particular factors in reaching conclusions with respect to each advisory and sub-advisory agreement.

Results of the Process

Based on its consideration of the foregoing, and such other information as it deemed relevant, including the factors and conclusions described below, the Special Committee concluded that the continuance of the investment advisory agreements of the following funds:

•  Eaton Vance Insured Municipal Bond Fund II

•  Eaton Vance Insured California Municipal Bond Fund II

•  Eaton Vance Insured Florida Municipal Bond Fund

•  Eaton Vance Insured Massachusetts Municipal Bond Fund

•  Eaton Vance Insured Michigan Municipal Bond Fund

•  Eaton Vance Insured New Jersey Municipal Bond Fund

•  Eaton Vance Insured New York Municipal Bond Fund II

•  Eaton Vance Insured Ohio Municipal Bond Fund

•  Eaton Vance Insured Pennsylvania Municipal Bond Fund

(the "Funds"), each with Eaton Vance Management (the "Adviser"), including their fee structures, is in the interests of shareholders and, therefore, the Special Committee recommended to the Board approval of each agreement. The Board accepted the recommendation of the Special Committee as well as the factors considered and conclusions reached by the Special Committee with respect to each agreement. Accordingly, the Board, including a majority of the Independent Trustees, voted to approve continuation of the advisory agreement for each Fund.

Nature, Extent and Quality of Services

In considering whether to approve the investment advisory agreements of the Funds, the Board evaluated the nature, extent and quality of services provided to the Funds by the Adviser.

The Board considered the Adviser's management capabilities and investment process with respect to the types of investments held by each Fund, including the education, experience and number of its investment professionals and other personnel who provide portfolio management, investment research, and similar services to the Funds, and recent changes in the identity of such personnel. In particular, the Board evaluated, where relevant, the abilities and experience of such investment personnel in analyzing factors such as credit risk, tax efficiency, and special considerations relevant to investing in municipal bonds. Specifically, the Board considered the Adviser's 30-person municipal bond team, which includes six portfolio managers and nine credit specialists who provide services to the Funds. The Board also took into account the resources dedicated to portfolio management and other services, including the compensation paid to recruit and retain investment personnel, and the time and attention devoted to each Fund in the complex by senior management.

The Board reviewed the compliance programs of the Adviser and relevant affiliates thereof. Among other matters, the Board considered compliance and reporting matters relating to personal trading by investment personnel, selective disclosure of portfolio holdings, late trading, frequent trading, portfolio valuation, business continuity and the allocation of investment opportunities. The Board also evaluated the responses of the Adviser and its affiliates to requests from regulatory authorities such as the Securities and Exchange Commission and the National Association of Securities Dealers.


81



Eaton Vance Insured Municipal Bond Funds

BOARD OF TRUSTEES' ANNUAL APPROVAL OF THE INVESTMENT ADVISORY AGREEMENTS CONT'D

The Board also considered shareholder and other administrative services provided or managed by Eaton Vance Management and its affiliates, including transfer agency and accounting services. The Board evaluated the benefits to shareholders of investing in a fund that is a part of a large family of funds.

After consideration of the foregoing factors, among others, the Board concluded that the nature, extent and quality of services provided by the Adviser, taken as a whole, are appropriate and consistent with the terms of the respective investment advisory agreements.

Fund Performance

The Board compared each Fund's investment performance to a relevant universe of similarly managed funds identified by an independent data provider and appropriate benchmark indices. The Board reviewed comparative performance data for the year ended September 30, 2006 for each Fund. On the basis of the foregoing and other relevant information, the Board concluded that the performance of each Fund was satisfactory.

Management Fees and Expenses

The Board reviewed contractual investment advisory fee rates, including any administrative fee rates, payable by each Fund (referred to collectively as "management fees"). As part of its review, the Board considered each Fund's management fee and total expense ratio for the year ended September 30, 2006, as compared to a group of similarly managed funds selected by an independent data provider. The Board considered the fact that the Adviser had waived fees and/or paid expenses for each of the Funds.

After reviewing the foregoing information, and in light of the nature, extent and quality of the services provided by the Adviser, the Board concluded with respect to each Fund that the management fees charged to the Fund for advisory and related services and the total expense ratio of the Fund are reasonable.

Profitability

The Board reviewed the level of profits realized by the Adviser and, if applicable, its affiliates in providing investment advisory and administrative services to each Fund and to all Eaton Vance Funds as a group. The Board considered the level of profits realized without regard to revenue sharing or other payments by the Adviser and its affiliates to third parties in respect of distribution services. The Board also considered other direct or indirect benefits received by the Adviser and its affiliates in connection with their relationship with the Funds.

The Board concluded that, in light of the foregoing factors and the nature, extent and quality of the services rendered, the profits realized by the Adviser and its affiliates are reasonable.

Economies of Scale

In reviewing management fees and profitability, the Board also considered the extent to which the Adviser and its affiliates, on the one hand, and each Fund, on the other hand, can expect to realize benefits from economies of scale as the assets of the Fund increase. The Board acknowledged the difficulty in accurately measuring the benefits resulting from the economies of scale with respect to the management of any specific fund or group of funds. The Board also considered the fact that none of the Funds is continuously offered and concluded that, in light of the level of the adviser's profits with respect to each Fund, the implementation of breakpoints in the advisory fee schedule is not appropriate. Based upon the foregoing, the Board concluded that the benefits from economies of scale are currently being shared equitably by the Adviser and its affiliates and each Fund.


82




Eaton Vance Insured Municipal Bond Funds

MANAGEMENT AND ORGANIZATION

Fund Management. The Trustees and officers of Eaton Vance Insured Municipal Bond Fund II (EIV), Eaton Vance Insured California Municipal Bond Fund II (EIA), Eaton Vance Insured Florida Municipal Bond Fund (EIF), Eaton Vance Insured Massachusetts Municipal Bond Fund (MAB), Eaton Vance Insured Michigan Municipal Bond Fund (MIW), Eaton Vance Insured New Jersey Municipal Bond Fund (EMJ), Eaton Vance Insured New York Municipal Bond Fund II (NYH), Eaton Vance Insured Ohio Municipal Bond Fund (EIO), and Eaton Vance Pennsylvania Municipal Bond Fund (EIP) (the Funds) are listed below. Except as indicated, each individual has held the office shown or other offices in the same company for the last five years. The "noninterested Trustees" consist of those Trustees who are not "interested persons" of the Funds, as that term is defined under the 1940 Act. The business address of each Trustee and officer is The Eaton Vance Building, 255 State Street, Boston, Massachusetts 02109. As used below, "EVC" refers to Eaton Vance Corp., "EV" refers to Eaton Vance, Inc., "EVM" refers to Eaton Vance Management, "BMR" refers to Boston Management and Research and "EVD" refers to Eaton Vance Distributors, Inc. EVC and EV are the corporate parent and trustee, respectively, of EVM and BMR. EVD is a wholly-owned subsidiary of EVM. Each officer affiliated with Eaton Vance may hold a position with other Eaton Vance affiliates that is comparable to his or her position with EVM listed below.

Name and
Date of Birth
  Position(s)
with the
Funds
  Term of
Office and
Length of
Service
  Principal Occupation(s)
During Past Five Years
  Number of Portfolios
in Fund Complex
Overseen By
Trustee(1) 
  Other Directorships Held  
Interested Trustee                          
Thomas E. Faust Jr. 5/31/58   Trustee   Until 2010. 3 years. Trustee since 2007   Chairman, Chief Executive Officer and President of EVC, President of EV, Chief Executive Officer and President of EVM and BMR, and Director of EVD. Trustee and/or Officer of 176 registered investment companies and 5 private investment companies in the Eaton Vance Fund Complex. Mr. Faust is an interested person because of his positions with EVM, BMR, EVC and EV which are affiliates of each Fund.     176     Director of EVC  
Noninterested Trustee(s)                          
Benjamin C. Esty(A) 1/2/63   Trustee   Until 2008. 3 years. Trustee since 2005   Roy and Elizabeth Simmons Professor of Business Administration, Harvard University Graduate School of Business Administration (since 2003). Formerly, Associate Professor, Harvard University Graduate School of Business Administration (2000-2003).     176     None  
Allen R. Freedman 4/3/40   Trustee   Until 2010. 3 years. Trustee since 2007   Former Chairman and Chief Executive Officer of Assurant, Inc. (insurance provider) (1978-2000). Formerly, a Director of Loring Ward International (fund distributor) (2005-2007).     175     Director of Assurant, Inc. and Stonemor Partners L.P. (owner and operator of cemeteries)  
William H. Park 9/19/47   Trustee   Until 2009. 3 years. Trustee since 2003   Vice Chairman, Commercial Industrial Finance Corp. (specialty finance company) (since 2006). Formerly, President and Chief Executive Officer, Prizm Capital Management, LLC (investment management firm) (2002-2005).     176     None  
Ronald A. Pearlman 7/10/40   Trustee   Until 2008. 3 years. Trustee since 2003   Professor of Law, Georgetown University Law Center.     176     None  
Norton H. Reamer(A) 9/21/35   Trustee   Until 2008. 3 years. Trustee since 2002   President, Chief Executive Officer and a Director of Asset Management Finance Corp. (a specialty finance company serving the investment management industry) (since October 2003). President, Unicorn Corporation (an investment and financial advisory services company) (since September 2000). Formerly, Chairman and Chief Operating Officer, Hellman, Jordan Management Co., Inc. (an investment management company) (2000-2003). Formerly, Advisory Director of Berkshire Capital Corporation (investment banking firm) (2002-2003).     176     None  

 


83



Eaton Vance Insured Municipal Bond Funds

MANAGEMENT AND ORGANIZATION CONT'D

Name and
Date of Birth
  Position(s)
with the
Funds
  Term of
Office and
Length of
Service
  Principal Occupation(s)
During Past Five Years
  Number of Portfolios
in Fund Complex
Overseen By
Trustee(1) 
  Other Directorships Held  
Noninterested Trustee(s) (continued)                          
Heidi L. Steiger 7/8/53   Trustee   Until 2008. 3 years. Trustee since 2007   President, Lowenhaupt Global Advisors, LLC (global wealth management firm) (since 2005); Formerly, President and Contributing Editor, Worth Magazine (2004); Formerly, Executive Vice President and Global Head of Private Asset Management (and various other positions), Neuberger Berman (investment firm) (1986-2004).     173     Director of Nuclear Electric Insurance Ltd. (nuclear insurance provider) and Aviva USA (insurance provider)  
Lynn A. Stout 9/14/57   Trustee   Until 2009. 3 years. Trustee since 2002   Paul Hastings Professor of Corporate and Securities Law, University of California at Los Angeles School of Law.     176     None  
Ralph F. Verni 1/26/43   Chairman of the Board and Trustee   Chairman of the Board since 2007. Trustee until 2009. 3 years. Trustee since 2005   Consultant and private investor.     176     None  
Principal Officers who are not Trustees                          

 

Name and
Date of Birth
  Position(s)
with the
Funds
  Term of
Office and
Length of
Service
  Principal Occupation(s)
During Past Five Years
 
Cynthia J. Clemson 3/2/63   President of EIA, EIF, MIW, NYH, EIO and EIP; Vice President of MAB, EIV and EMJ   President of EIA, EIF, MIW, NYH, EIO and EIP since 2005 and Vice President of MAB, EIV and EMJ since 2004   Vice President of EVM and BMR. Officer of 89 registered investment companies managed by EVM or BMR.  
Robert B. MacIntosh 1/22/57   President of MAB, EIV and EMJ; Vice President of EIA, EIF, MIW, NYH, EIO and EIP   President of MAB, EIV and EMJ since 2005 and Vice President of EIA, EIF, MIW, NYH, EIO and EIP since 2002   Vice President of EVM and BMR. Officer of 89 registered investment companies managed by EVM or BMR.  
William H. Ahern, Jr. 7/28/59   Vice President of MIW, EIV and EIO   Vice President of MIW since 2002; of EIV since 2004; and of EIO since 2005   Vice President of EVM and BMR. Officer of 74 registered investment companies managed by EVM or BMR.  
Craig R. Brandon 12/31/66   Vice President of EIF and NYH   Vice President of EIF since 2004; and of NYH since 2005   Vice President of EVM and BMR. Officer of 44 registered investment companies managed by EVM or BMR.  
Adam A. Weigold 3/22/75   Vice President of EIP   Since 2007   Vice President of EVM and BMR. Officer of 70 registered investment companies managed by EVM or BMR.  
Barbara E. Campbell 6/19/57   Treasurer   Since 2005   Vice President of EVM and BMR. Officer of 176 registered investment companies managed by EVM and BMR.  
Maureen A. Gemma 5/24/60   Secretary   Since 2007   Deputy Chief Legal officer of EVM, and BMR, and Vice Presient of EVM and BMR.
Officer of 176 registered investment companies managed by EVM or BMR.
 
Paul M. O'Neil 7/1/53   Chief Compliance Officer   Since 2004   Vice President of EVM and BMR. Officer of 176 registered investment companies managed by EVM or BMR.  

 

(1)  Includes both master and feeder funds in a master-feeder structure.

(A)  APS Trustee.


84



Eaton Vance Insured Municipal Bond Funds

NOTICE TO SHAREHOLDERS

On November 1, 2007, each of Eaton Vance Insured California Municipal Bond Fund II, Eaton Vance Insured Florida Municipal Bond Fund, Eaton Vance Insured Massachusetts Municipal Bond Fund, Eaton Vance Insured Michigan Municipal Bond Fund, Eaton Vance Insured Municipal Bond Fund II, Eaton Vance Insured New Jersey Municipal Bond Fund, Eaton Vance Insured New York Municipal Bond Fund II, Eaton Vance Insured Ohio Municipal Bond Fund and Eaton Vance Insured Pennsylvania Municipal Bond Fund implemented a revised investment policy recently approved by the Fund's Board of Trustees.

Prior to that date, this investment policy stated that at least 80% of total assets of each Fund will normally be invested in municipal obligations rated in the highest category at the time of investment (which is Aaa by Moody's or AAA by S&P or Fitch or, if unrated, determined to be of comparable quality by the adviser). As of November 1, 2007, and consistent with the other Eaton Vance Insured Municipal Bond Funds, the new policy states that at least 80% of each Fund's net assets will normally be invested in municipal obligations rated in the highest category at the time of investment.


85



Eaton Vance Insured Municipal Bond Funds

NOTICE TO SHAREHOLDERS CONT'D

The Florida state intangibles tax was repealed effective January 1, 2007. Accordingly, the Board of Trustees of Eaton Vance Insured Florida Municipal Bond Fund approved a revision of the Fund's investment objective. Prior to January 1, 2007, the Fund's objective was "to provide current income exempt from federal income tax, including alternative minimum tax, in the form of an investment exempt from Florida intangibles tax." As of January 1, 2007, the Fund's objective is "to provide current income exempt from federal income tax, including alternative minimum tax."


86



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Investment Adviser and Administrator of Eaton Vance Insured Municipal Bond Funds
Eaton Vance Management

The Eaton Vance Building
255 State Street
Boston, MA 02109

Custodian
State Street Bank and Trust Company

200 Clarendon Street
Boston, MA 02116

Transfer Agent and Dividend Disbursing Agent
PFPC Inc.

Attn: Eaton Vance Insured Municipal Bond Funds
P.O. Box 43027
Providence, RI 02940-3027
(800) 331-1710

Independent Registered Public Accounting Firm
Deloitte & Touche LLP

200 Berkeley Street
Boston, MA 02116-5022

Eaton Vance Insured Municipal Bond Funds
The Eaton Vance Building
255 State Street
Boston, MA 02109



1557-11/07  9IMBIISRC




Item 2. Code of Ethics

The registrant has adopted a code of ethics applicable to its Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer.  The registrant undertakes to provide a copy of such code of ethics to any person upon request, without charge, by calling 1-800-262-1122.

Item 3. Audit Committee Financial Expert

The registrant’s Board has designated William H. Park and Norton H. Reamer, each an independent trustee, as its audit committee financial experts.  Mr. Park is a certified public accountant who is the Vice Chairman of Commercial Industrial Finance Corp (specialty finance company). Previously, he served as President and Chief Executive Officer of Prizm Capital Management, LLC (investment management firm) and as Executive Vice President and Chief Financial Officer of United Asset Management Corporation (“UAM”) (a holding company owning institutional investment management firms). Mr. Reamer is the President, Chief Executive Officer and a Director of Asset Management Finance Corp. (a specialty finance company serving the investment management industry) and is President of Unicorn Corporation (an investment and financial advisory services company).  Formerly, Mr. Reamer was Chairman and Chief Operating Officer of Hellman, Jordan Management Co., Inc. (an investment management company) and Advisory Director of Berkshire Capital Corporation (an investment banking firm), Chairman of the Board of UAM and Chairman, President and Director of the UAM Funds (mutual funds).

Item 4. Principal Accountant Fees and Services

(a) –(d)

The following table presents the aggregate fees billed to the registrant for the registrant’s fiscal years ended September 30, 2006 and September 30, 2007 by the Fund’s principal accountant for professional services rendered for the audit of the registrant’s annual financial statements and fees billed for other services rendered by the principal accountant during such period.

Fiscal Years Ended

 

9/30/06

 

9/30/07

 

 

 

 

 

 

 

Audit Fees

 

$

22,340

 

$

24,090

 

 

 

 

 

 

 

Audit-Related Fees(1)

 

$

3,675

 

$

3,785

 

 

 

 

 

 

 

Tax Fees(2)

 

$

6,650

 

$

6,883

 

 

 

 

 

 

 

All Other Fees(3)

 

$

0

 

0

 

 

 

 

 

 

 

Total

 

$

32,665

 

$

34,758

 

 


(1)

 

Audit-related fees consist of the aggregate fees billed for assurance and related services that are reasonably related to the performance of the audit of the registrant’s financial statements and are not reported under the category of audit fees and specifically include fees for the performance of certain agreed-upon procedures relating to the registrant’s auction preferred shares.

 

 

 

(2)

 

Tax fees consist of the aggregate fees billed for professional services rendered by the principal accountant relating to tax compliance, tax advice, and tax planning and specifically include fees for tax return preparation.

 

 

 

(3)

 

All other fees consist of the aggregate fees billed for products and services provided by the registrant’s principal accountant other than audit, audit-related, and tax services.

 

(e)(1) The registrant’s audit committee has adopted policies and procedures relating to the pre-approval of services provided by the registrant’s principal accountant (the “Pre-Approval Policies”).  The Pre-Approval Policies establish a framework intended to assist the audit committee in the proper discharge of its pre-approval responsibilities.  As a general matter, the Pre-Approval Policies (i) specify certain




types of audit, audit-related, tax, and other services determined to be pre-approved by the audit committee; and (ii) delineate specific procedures governing the mechanics of the pre-approval process, including the approval and monitoring of audit and non-audit service fees.  Unless a service is specifically pre-approved under the Pre-Approval Policies, it must be separately pre-approved by the audit committee.

The Pre-Approval Policies and the types of audit and non-audit services pre-approved therein must be reviewed and ratified by the registrant’s audit committee at least annually.  The registrant’s audit committee maintains full responsibility for the appointment, compensation, and oversight of the work of the registrant’s principal accountant.

(e)(2) No services described in paragraphs (b)-(d) above were approved by the registrant’s audit committee pursuant to the “de minimis exception” set forth in Rule 2-01 (c)(7)(i)(C) of Regulation S-X.

(f) Not applicable.

(g) The following table presents (i) the aggregate non-audit fees (i.e., fees for audit-related, tax, and other services) billed to the registrant by the registrant’s principal accountant for the registrant’s fiscal year ended September 30, 2006 and the fiscal year ended September 30, 2007; and (ii) the aggregate non-audit fees (i.e., fees for audit-related, tax, and other services) billed to the Eaton Vance organization by the registrant’s principal accountant for the same time periods.

Fiscal Years Ended

 

9/30/06

 

9/30/07

 

 

 

 

 

 

 

Registrant

 

$

10,325

 

$

10,668

 

 

 

 

 

 

 

Eaton Vance(1)

 

$

72,100

 

$

289,446

 

 

 

 

 

 

 

Total

 

$

82,425

 

$

300,114

 

 


(1)                                  The investment adviser to the registrant, as well as any of its affiliates that provide ongoing services to the registrant, are subsidiaries of Eaton Vance Corp.

(h) The registrant’s audit committee has considered whether the provision by the registrant’s principal accountant of non-audit services to the registrant’s investment adviser and any entity controlling, controlled by, or under common control with the adviser that provides ongoing services to the registrant that were not pre-approved pursuant to Rule 2-01(c)(7)(ii) of Regulation S-X is compatible with maintaining the principal accountant’s independence.

Item 5.  Audit Committee of Listed registrants

The registrant has a separately-designated standing audit committee established in accordance with Section 3(a)(58)(A) of the Securities and Exchange Act of 1934, as amended.  Norton H. Reamer (Chair), William H. Park, Lynn A. Stout, Heidi L. Steiger and Ralph E. Verni are the members of the registrant’s audit committee.




Item 6. Schedule of Investments

Please see schedule of investments contained in the Report to Stockholders included under Item 1 of this Form N-CSR.

Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies

The Board of Trustees of the Trust has adopted a proxy voting policy and procedure (the “Fund Policy”), pursuant to which the Trustees have delegated proxy voting responsibility to the Fund’s investment adviser and adopted the investment adviser’s proxy voting policies and procedures (the “Policies”) which are described below.  The Trustees will review the Fund’s proxy voting records from time to time and will annually consider approving the Policies for the upcoming year.  In the event that a conflict of interest arises between the Fund’s shareholders and the investment adviser, the administrator, or any of their affiliates or any affiliate of the Fund, the investment adviser will generally refrain from voting the proxies related to the companies giving rise to such conflict until it consults with the Board’s Special Committee except as contemplated under the Fund Policy.  The Board’s Special Committee will instruct the investment adviser on the appropriate course of action.

The Policies are designed to promote accountability of a company’s management to its shareholders and to align the interests of management with those shareholders. An independent proxy voting service (“Agent”), currently Institutional Shareholder Services, Inc., has been retained to assist in the voting of proxies through the provision of vote analysis, implementation and recordkeeping and disclosure services.  The investment adviser will generally vote proxies through the Agent.  The Agent is required to vote all proxies and/or refer then back to the investment adviser pursuant to the Policies.  It is generally the policy of the investment adviser to vote in accordance with the recommendation of the Agent.  The Agent shall refer to the investment adviser proxies relating to mergers and restructurings, and the disposition of assets, termination, liquidation and mergers contained in mutual fund proxies.  The investment adviser will normally vote against anti-takeover measures and other proposals designed to limit the ability of shareholders to act on possible transactions, except in the case of closed-end management investment companies.  The investment adviser generally supports management on social and environmental proposals.  The investment adviser may abstain from voting from time to time where it determines that the costs associated with voting a proxy outweighs the benefits derived from exercising the right to vote or the economic effect on shareholders interests or the value of the portfolio holding is indeterminable or insignificant.

In addition, the investment adviser will monitor situations that may result in a conflict of interest between the Fund’s shareholders and the investment adviser, the administrator, or any of their affiliates or any affiliate of the Fund by maintaining a list of significant existing and prospective corporate clients.  The investment adviser’s personnel responsible for reviewing and voting proxies on behalf of the Fund will report any proxy received or expected to be received from a company included on that list to the personal of the investment adviser identified in the Policies. If such personnel expects to instruct the Agent to vote such proxies in a manner inconsistent with the guidelines of the Policies or the recommendation of the Agent, the personnel will consult with members of senior management of the investment adviser to determine if a material conflict of interests exists.  If it is determined that a




material conflict does exist, the investment adviser will seek instruction on how to vote from the Special Committee.

Information on how the Fund voted proxies relating to portfolio securities during the most recent 12 month period ended June 30 is available (1) without charge, upon request, by calling 1-800-262-1122, and (2) on the Securities and Exchange Commission’s website at http://www.sec.gov.

Item 8. Portfolio Managers of Closed-End Management Investment Companies

Insured California Muni II, Insured Florida, Insured Massachusetts, Insured Michigan, Insured Municipal Bond II, Insured New York Muni II, Insured New Jersey, Insured Ohio, Insured Pennsylvania

Portfolio Management

Cynthia J. Clemson, portfolio manager of Eaton Vance Insured California Municipal Bond Fund II, Robert B. MacIntosh, portfolio manager of Eaton Vance Insured Massachusetts Municipal Bond Fund and Eaton Vance Insured New Jersey Municipal Bond Fund, William H. Ahern, Jr., portfolio manager of Eaton Vance Insured Michigan Municipal Bond Fund, Eaton Vance Insured Municipal Bond Fund II and Eaton Vance Insured Ohio Municipal Bond Fund, Craig R. Brandon, portfolio manager of Eaton Vance Insured Florida Municipal Bond Fund and Eaton Vance Insured New York Municipal Bond Fund II and Adam A. Weigold, portfolio manager of Eaton Vance Insured Pennsylvania Municipal Bond Fund are responsible for the overall and day-to-day management of each Fund’s investments.

Ms. Clemson has been an Eaton Vance portfolio manager since 1991 and is a Vice President of EVM and Boston Management and Research, an Eaton Vance subsidiary (“BMR”).  Mr. MacIntosh has been an Eaton Vance portfolio manager since 1991 and is a Vice President of EVM and BMR.  Mr. Ahern has been an Eaton Vance portfolio manager since 1993 and is a Vice President of EVM and BMR.  Mr. Brandon has been an Eaton Vance analyst since 1998 and a portfolio manager since 2004, and is a Vice President of EVM and BMR.  Mr. Weigold has been a credit analyst with Eaton Vance since 1991 and a portfolio manager since 2007.  He is a Vice President of EVM and BMR.  This information is provided as of the date of filing of this report.

The following tables show, as of each Fund’s most recent fiscal year end, the number of accounts each portfolio manager managed in each of the listed categories and the total assets in the accounts managed within each category.  The table also shows the number of accounts with respect to which the advisory fee is based on the performance of the account, if any, and the total assets in those accounts.

 

Number
of All
Accounts

 

Total Assets
of All
Accounts*

 

Number of
Accounts
Paying a
Performance Fee

 

Total Assets of
Accounts Paying a
Performance Fee*

 

Insured California Municipal Bond Fund II

 

 

 

 

 

 

 

 

 

Cynthia J. Clemson

 

 

 

 

 

 

 

 

 

Registered Investment Companies

 

10

 

$

3,648.2

 

0

 

$

0

 

Other Pooled Investment Vehicles

 

0

 

$

0

 

0

 

$

0

 

Other Accounts

 

0

 

$

0

 

0

 

$

0

 

 

 

 

 

 

 

 

 

 

 

Insured Massachusetts Municipal Bond Fund

 

 

 

 

 

 

 

 

 

Insured New Jersey Municipal Bond Fund

 

 

 

 

 

 

 

 

 

Robert B. MacIntosh

 

 

 

 

 

 

 

 

 

Registered Investment Companies

 

10

 

$

2,635.7

 

0

 

$

0

 

Other Pooled Investment Vehicles

 

0

 

$

0

 

0

 

$

0

 

Other Accounts

 

224

 

$

181.8

 

0

 

$

0

 

 




 

 

Number
of All
Accounts

 

Total Assets
of All
Accounts*

 

Number of
Accounts
Paying a
Performance Fee

 

Total Assets of
Accounts Paying a
Performance Fee*

 

Insured Municipal Bond Fund II

 

 

 

 

 

 

 

 

 

Insured Michigan Municipal Bond Fund

 

 

 

 

 

 

 

 

 

Insured Ohio Municipal Bond Fund

 

 

 

 

 

 

 

 

 

William H. Ahern

 

 

 

 

 

 

 

 

 

Registered Investment Companies

 

14

 

$

1,848.3

 

0

 

$

0

 

Other Pooled Investment Vehicles

 

0

 

$

0

 

0

 

$

0

 

Other Accounts

 

0

 

$

0

 

0

 

$

0

 

 

 

 

 

 

 

 

 

 

 

Insured Florida Municipal Bond Fund

 

 

 

 

 

 

 

 

 

Insured New York Municipal Bond Fund II

 

 

 

 

 

 

 

 

 

Craig R. Brandon

 

 

 

 

 

 

 

 

 

Registered Investment Companies

 

12

 

$

1,481.7

 

0

 

$

0

 

Other Pooled Investment Vehicles

 

0

 

$

0

 

0

 

$

0

 

Other Accounts

 

0

 

$

0

 

0

 

$

0

 

 

 

 

 

 

 

 

 

 

 

Insured Pennsylvania Municipal Bond Fund

 

 

 

 

 

 

 

 

 

Adam a. Weigold

 

 

 

 

 

 

 

 

 

Registered Investment Companies

 

12

 

$

1,013.8

 

0

 

$

0

 

Other Pooled Investment Vehicles

 

0

 

$

0

 

0

 

$

0

 

Other Accounts

 

0

 

$

0

 

0

 

$

0

 

 


*In millions of dollars.  For registered investment companies, assets represent net assets of all open-end investment companies and gross assets of all closed-end investment companies.

The following table shows the dollar range of Fund shares beneficially owned by each portfolio manager as of each Fund’s most recent fiscal year end.

 

 

Dollar Range of
Equity Securities
Owned in the
Fund

 

 

 

Insured California II

 

 

Cynthia J. Clemson

 

None

 




 

Insured Massachusetts

 

 

Insured New Jersey

 

 

Robert B. MacIntosh

 

None

 

 

 

Insured Michigan

 

 

Insured Municipal II

 

 

Insured Ohio

 

 

William H. Ahern, Jr.

 

None

 

 

 

Insured Florida

 

 

Insured New York II

 

 

Craig R. Brandon

 

None

 

 

 

Insured Pennsylvania

 

 

Adam a. Weigold

 

None

 

Potential for Conflicts of Interest.  The portfolio managers manage multiple investment portfolios.  Conflicts of interest may arise between a portfolio manager’s management of the Fund and his or her management of these other investment portfolios. Potential areas of conflict may include allocation of a portfolio manager’s time, investment opportunities and trades among investment portfolios, including the Fund, personal securities transactions and use of Fund portfolio holdings information.   In addition, some investment portfolios may compensate the investment adviser or sub-adviser based on the performance of the securities held by that account. The existence of such a performance based fee may create additional conflicts of interest for a portfolio manager in the allocation of management time and investment opportunities.  EVM has adopted policies and procedures that it believes are reasonably designed to address these conflicts.  There is no guarantee that such policies and procedures will be effective or that all potential conflicts will be anticipated.

Portfolio Manager Compensation Structure

Compensation of EVM’s portfolio managers and other investment professionals has three primary components: (1) a base salary, (2) an annual cash bonus, and (3) annual stock-based compensation consisting of options to purchase shares of EVC’s nonvoting common stock and/or restricted shares of EVC’s nonvoting common stock. EVM’s investment professionals also receive certain retirement, insurance and other benefits that are broadly available to all EVM’s employees. Compensation of EVM’s investment professionals is reviewed primarily on an annual basis. Cash bonuses, stock-based compensation awards, and adjustments in base salary are typically paid or put into effect at or shortly after the October 31st fiscal year end of EVC.

Method to Determine Compensation. EVM compensates its portfolio managers based primarily on the scale and complexity of their portfolio responsibilities and the total return performance of managed funds and accounts versus appropriate peer groups or benchmarks. Performance is normally based on periods ending on the September 30th preceding fiscal year end. Fund performance is evaluated primarily versus peer groups of funds as determined by Lipper Inc. and/or Morningstar, Inc. In evaluating the performance of a fund and its manager, primary emphasis is normally placed on three-year performance, with secondary consideration of performance over longer and shorter periods. For funds that are tax-managed or otherwise have an objective of after-tax returns, performance is measured net of taxes. For other funds, performance is evaluated on a pre-tax basis. In addition to rankings within peer groups of funds on the basis of absolute performance, consideration may also be given to risk-adjusted performance. For funds with an investment objective other than total return (such as current income), consideration will also be given to the fund’s success in achieving its objective. For managers responsible for multiple funds and accounts, investment performance is evaluated on an aggregate basis, based on averages or weighted averages among managed funds and accounts. Funds and accounts that have performance-based advisory fees are not accorded disproportionate weightings in measuring aggregate portfolio manager performance.

The compensation of portfolio managers with other job responsibilities (such as heading an investment group or providing analytical support to other portfolios) will include consideration of the scope of such responsibilities and the managers’ performance in meeting them.

EVM seeks to compensate portfolio managers commensurate with their responsibilities and performance, and competitive with other firms within the investment management industry. EVM participates in investment-industry compensation surveys and utilizes survey data as a factor in determining salary, bonus and stock-based compensation levels for portfolio managers and other investment professionals. Salaries, bonuses and stock-based compensation are also influenced by the operating




performance of EVM and its parent company. The overall annual cash bonus pool is based on a substantially fixed percentage of pre-bonus operating income. While the salaries of EVM’s portfolio managers are comparatively fixed, cash bonuses and stock-based compensation may fluctuate significantly from year to year, based on changes in manager performance and other factors as described herein. For a high performing portfolio manager, cash bonuses and stock-based compensation may represent a substantial portion of total compensation.

Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.

No such purchases this period.

Item 10. Submission of Matters to a Vote of Security Holders.

No Material Changes.

Item 11. Controls and Procedures

(a) It is the conclusion of the registrant’s principal executive officer and principal financial officer that the effectiveness of the registrant’s current disclosure controls and procedures (such disclosure controls and procedures having been evaluated within 90 days of the date of this filing) provide reasonable assurance that the information required to be disclosed by the registrant has been recorded, processed, summarized and reported within the time period specified in the Commission’s rules and forms and that the information required to be disclosed by the registrant has been accumulated and communicated to the registrant’s principal executive officer and principal financial officer in order to allow timely decisions regarding required disclosure.

(b) There have been no changes in the registrant’s internal controls over financial reporting during the 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)

 

Registrant’s Code of Ethics – Not applicable (please see Item 2).

(a)(2)(i)

 

Treasurer’s Section 302 certification.

(a)(2)(ii)

 

President’s Section 302 certification.

(b)

 

Combined Section 906 certification.

 




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.

Eaton Vance Insured Pennsylvania Municipal Bond Fund

 

 

 

By:

/s/Cynthia J. Clemson

 

 

 

Cynthia J. Clemson

 

 

President

 

 

 

 

 

 

 

Date:

November 15, 2007

 

 

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By:

/s/Barbara E. Campbell

 

 

 

Barbara E. Campbell

 

 

Treasurer

 

 

 

 

 

 

 

Date:

November 15, 2007

 

 

 

 

 

 

 

By:

/s/Cynthia J. Clemson

 

 

 

Cynthia J. Clemson

 

 

President

 

 

 

 

 

 

 

Date:

November 15, 2007