UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC  20549
 
FORM N-CSR
 
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANY
 

 
Investment Company Act file number 811-01701
 

 
 
DAVIS NEW YORK VENTURE FUND, INC.
 
(Exact name of registrant as specified in charter)
 

 
2949 East Elvira Road, Suite 101
Tucson, AZ  85756
(Address of principal executive offices)

Thomas D. Tays
Davis Selected Advisers, L.P.
2949 East Elvira Road, Suite 101
Tucson, AZ  85756
(Name and address of agent for service)

Registrant’s telephone number, including area code: 520-806-7600
 
Date of fiscal year end: October 31, 2012
 
Date of reporting period: October 31, 2012


____________________








ITEM 1.  REPORT TO STOCKHOLDERS






 
 
 
 
 
DAVIS NEW YORK VENTURE FUND, INC.
Table of Contents
DAVIS GLOBAL FUND
 
DAVIS INTERNATIONAL FUND
 

 
 
Shareholder Letter                                                                                                                          
2
   
Management’s Discussion of Fund Performance:
 
Davis Global Fund                                                                                                                     
3
Davis International Fund                                                                                                                     
5
   
Fund Overview:
 
Davis Global Fund                                                                                                                     
7
Davis International Fund                                                                                                                     
9
   
Expense Example                                                                                                                          
11
   
Schedule of Investments:
 
Davis Global Fund                                                                                                                     
13
Davis International Fund                                                                                                                     
17
   
Statements of Assets and Liabilities                                                                                                                          
21
   
Statements of Operations                                                                                                                          
23
   
Statements of Changes in Net Assets                                                                                                                          
24
   
Notes to Financial Statements                                                                                                                          
26
   
Financial Highlights                                                                                                                          
37
   
Report of Independent Registered Public Accounting Firm                                                                                                                          
41
   
Federal Income Tax Information                                                                                                                          
42
   
Fund Information                                                                                                                          
43
   
Privacy Notice and Householding                                                                                                                          
44
   
Directors and Officers                                                                                                                          
45


This Annual Report is authorized for use by existing shareholders. Prospective shareholders must receive a current Davis Global Fund and Davis International Fund prospectus, which contains more information about investment strategies, risks, charges, and expenses.  Please read the prospectus carefully before investing or sending money.

Shares of Davis Global Fund and Davis International Fund are not deposits or obligations of any bank, are not guaranteed by any bank, are not insured by the FDIC or any other agency, and involve investment risks, including possible loss of the principal amount invested.


 
 
 
 
 
DAVIS GLOBAL FUND
Shareholder Letter
DAVIS INTERNATIONAL FUND
 


Dear Fellow Shareholder,

As stewards of our customers’ savings, the management team and Directors of Davis Global Fund and Davis International Fund recognize the importance of candid, thorough, and regular communication with our shareholders.  In our Annual and Semi-Annual Reports we include all of the required quantitative information such as audited financial statements, detailed footnotes, performance reports, fund holdings, and performance attribution.  Also included is a list of positions opened and closed.

In addition, we produce a Question and Answer Update Commentary for each Fund.  In this commentary, we give a more qualitative perspective on fund performance, discuss our thoughts on individual holdings, and share our investment outlook.  You may obtain a copy of the current Question and Answer Update Commentary either on the Funds’ website at www.davisfunds.com or by calling 1-800-279-0279.

We thank you for your continued trust.  We will do our best to earn it in the years ahead.

Sincerely,


IMAGE 1

Christopher C. Davis
President


December 3, 2012



 
2
 
 
 
DAVIS GLOBAL FUND
Management’s Discussion of Fund Performance


Performance Overview

Davis Global Fund’s Class A shares delivered a total return on net asset value of 5.63% for the year ended October 31, 2012. Over the same time period, the Morgan Stanley Capital International All Country World Index   (“Index”) returned 8.55%. The sectors 1 within the Index delivering the strongest performance over the year were health care, consumer staples, and financials. The sectors delivering the weakest performance over the year were materials (which delivered negative performance), energy, and utilities.  As of October 31, 2012, the Fund had approximately 60% of its net assets invested in foreign companies, 39% in U.S. companies, and 1% in other assets and liabilities.

Factors Impacting the Fund’s Performance

Consumer staple companies were the most important contributor 2 to the Fund’s performance. The Fund’s consumer staple companies out-performed the corresponding sector within the Index and had a higher relative average weighting in this stronger performing sector. Brazil Pharma 3 , Heineken, and CVS Caremark were among the most important contributors to performance. The Fund no longer holds CVS Caremark.

Health care companies were also an important contributor to the Fund’s performance. The Fund’s health care companies out-performed the corresponding sector within the Index, but had a lower relative average weighting in this stronger performing sector. IDEXX Laboratories and Sinovac Biotech were among the most important contributors to performance.

Energy companies were an important detractor from the Fund’s performance. The Fund’s energy companies under-performed the corresponding sector within the Index, but had lower relative average weighting in this weaker performing sector. Tenaris was among the most important contributors to performance. OGX Petroleo e Gas Participacoes was among the most important detractors from performance.

Financial companies were the most important detractor from the Fund’s performance relative to the Index. The Fund’s financial companies under-performed the corresponding sector within the Index and had lower relative average weighting in this stronger performing sector. CETIP was among the most important detractors from performance.

The Fund had a large investment in industrial companies and this sector was the second most important detractor from the Fund’s relative performance. The Fund’s industrial companies under-performed the corresponding sector within the Index and had higher relative average weighting. Expeditors International of Washington, China Shipping Development, and LLX Logistica were among the most important detractors from performance. The Fund no longer holds China Shipping Development.

Other important contributors to the Fund’s performance included Walt Disney and Google. Other important detractors from the Fund’s performance included Groupon and Western Union.
 
Davis Global Fund’s investment objective is long-term growth of capital. There can be no assurance that the Fund will achieve its objective.  Davis Global Fund’s principal risks are: stock market risk, manager risk, common stock risk, foreign country risk, emerging market risk, foreign currency risk, trading markets and depositary receipts risk, under $10 billion market capitalization risk, headline risk, and fees and expenses risk. See the prospectus for a full description of each risk.

From its inception date in December 2004 until January 2007, shares of Davis Global Fund were not available for public sale. Only the directors, officers, and employees of the Fund or its investment adviser and sub-adviser (and the investment adviser itself and affiliated companies) were eligible to purchase Fund shares.

1      The companies included in the Morgan Stanley Capital International All Country World Index are divided into ten sectors. One or more industry groups make up a sector.
 
2      A company’s or sector’s contribution to or detraction from the Fund’s performance is a product both of its appreciation or depreciation and its weighting within the Fund.  For example, a 5% holding that rises 20% has twice as much impact as a 1% holding that rises 50%.
 
3      This Management Discussion of Fund Performance discusses a number of individual companies.  The information provided in this report does not provide information reasonably sufficient upon which to base an investment decision and should not be considered a recommendation to purchase or sell any particular security.  The Schedule of Investments lists the Fund’s holdings of each company discussed.
 
 
 
3
 
 
 
DAVIS GLOBAL FUND – (CONTINUED)
Management’s Discussion of Fund Performance


Comparison of a $10,000 investment in Davis Global Fund Class A versus the Morgan Stanley Capital International All Country World Index (MSCI ACWI ® ) for an investment made on December 22, 2004
 
 
 
GRAPH 1
                                             
Average Annual Total Return for periods ended October 31, 2012

 Fund & Benchmark Index
1-Year
5-Year
Since
Inception
Inception
Date
Gross
Expense Ratio
Net
Expense Ratio
 Class A - without sales charge
5.63%
(6.35)%
4.29%
12/22/04
1.05%
1.05%
 Class A - with sales charge
0.62%
(7.25)%
3.65%
12/22/04
1.05%
1.05%
 Class B † , **
0.26%
(7.76)%
3.29%
12/22/04
2.41%
2.30%
 Class C**
3.59%
(7.25)%
3.26%
12/22/04
1.99%
1.99%
 Class Y
5.96%
(6.12)%
(4.30)%
07/25/07
0.75%
0.75%
 MSCI ACWI ® ***
8.55%
(2.95)%
4.20%
     

The MSCI ACWI ® is a free float-adjusted market capitalization weighted index that is designed to measure the equity market performance of developed and emerging markets. The Index includes reinvestment of dividends, net of foreign withholding taxes.  Investments cannot be made directly in the Index.

The performance data for Davis Global Fund contained in this report represents past performance, assumes that all distributions were reinvested, and should not be considered as an indication of future performance from an investment in the Fund today. The investment return and principal value will fluctuate so that shares may be worth more or less than their original cost when redeemed. Fund performance changes over time and current performance may be higher or lower than stated. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The operating expense ratios may vary in future years. For more current information please call Davis Funds Investor Services at 1-800-279-0279.
 
*Reflects 4.75% front-end sales charge.
 
† Because Class B shares automatically convert to Class A shares after 7 years, the “Since Inception” return for Class B reflects Class A performance for the period after conversion.
 
**Includes any applicable contingent deferred sales charge.
 
***Inception return is from December 22, 2004.

 
 
4
 
 
 
DAVIS INTERNATIONAL FUND
Management’s Discussion of Fund Performance


Performance Overview

Davis International Fund’s Class A shares delivered a total return on net asset value of 5.39% for the year ended October 31, 2012. Over the same time period, the Morgan Stanley Capital International All Country World Index ex USA   (“Index”) returned 3.98%. The sectors 1 within the Index delivering the strongest performance over the year were health care, consumer staples, and financials. The sectors delivering the weakest performance over the year were materials, utilities, and energy. As of October 31, 2012, the Fund had approximately 92% of its net assets invested in foreign companies, 3% in U.S. companies, and 5% in other assets and liabilities.

Factors Impacting the Fund’s Performance

Health care companies were the most important contributor 2 to the Fund’s performance. The Fund’s health care companies out-performed the corresponding sector within the Index and had a higher relative average weighting in this stronger performing sector. Roche Holding 3 , Essilor, Sinovac Biotech, and Sinopharm were among the most important contributors to performance.

Consumer staple companies were the second most important contributor to the Fund’s performance. The Fund’s consumer staple companies out-performed the corresponding sector within the Index and had a higher relative average weighting in this stronger performing sector. Brazil Pharma and Heineken were among the most important contributors to performance.

Financial companies were the most important detractor from the Fund’s performance. The Fund’s financial companies under-performed the corresponding sector within the Index and had a lower relative average weighting in this stronger performing sector. CETIP and China Merchants Bank were among the most important detractors from performance.

Energy companies were also important detractors from the Fund’s performance. The Fund’s energy companies under-performed the corresponding sector within the Index, but had a lower relative average weighting in this weaker performing sector. Tenaris was among the most important contributors to performance. OGX Petroleo e Gas Participacoes was among the most important detractors from performance.

Other important contributors to performance included Greatview Aseptic Packaging and Compagnie Financiere Richemont. Other important detractors from performance included China Shipping Development, Sino-Forest, and Kuehne & Nagel. The Fund no longer holds China Shipping Development or Sino-Forest.
 
Davis International Fund’s investment objective is long-term growth of capital.  There can be no assurance that the Fund will achieve its objective.  Davis International Fund’s principal risks are: stock market risk, manager risk, common stock risk, foreign country risk, emerging market risk, foreign currency risk, trading markets and depositary receipts risk, under $10 billion market capitalization risk, headline risk, and fees and expenses risk. See the prospectus for a full description of each risk.

From its inception date in December 2006 until January 2010, shares of Davis International Fund were not available for public sale.  Only the directors, officers, and employees of the Fund, or its investment adviser and sub-adviser (and the investment adviser itself and affiliated companies), were eligible to purchase Fund shares.

1      The companies included in the Morgan Stanley Capital International All Country World Index ex USA are divided into ten sectors. One or more industry groups make up a sector.
 
2      A company’s or sector’s contribution to or detraction from the Fund’s performance is a product both of its appreciation or depreciation and its weighting within the Fund.  For example, a 5% holding that rises 20% has twice as much impact as a 1% holding that rises 50%.
 
3      This Management Discussion of Fund Performance discusses a number of individual companies.  The information provided in this report does not provide information reasonably sufficient upon which to base an investment decision and should not be considered a recommendation to purchase or sell any particular security.  The Schedule of Investments lists the Fund’s holdings of each company discussed.
 
 
 
5
 
 
 
DAVIS INTERNATIONAL FUND – (CONTINUED)
Management’s Discussion of Fund Performance


Comparison of a $10,000 investment in Davis International Fund Class A versus the Morgan Stanley Capital International All Country World Index ex USA (MSCI ACWI ® ex USA) for an investment made on December 29, 2006
 
 
GRAPH 2
                           
 
Average Annual Total Return for periods ended October 31, 2012

 Fund & Benchmark Index
1-Year
5-Year
Since
Inception
Inception
Date
Gross
Expense Ratio
Net
Expense Ratio
 Class A - without sales charge
5.39%
(8.15)%
(2.14)%
12/29/06
1.37%
1.30%
 Class A - with sales charge
0.38%
(9.04)%
(2.96)%
12/29/06
1.37%
1.30%
 Class B**
0.26%
(9.78)%
(3.62)%
12/29/06
4.40%
2.30%
 Class C**
3.27%
(9.45)%
(3.48)%
12/29/06
3.88%
2.30%
 Class Y
5.80%
N/A
  0.00%
12/31/09
0.90%
0.90%
 MSCI ACWI ® ex USA***
3.98%
(5.08)%
(0.78)%
     

The MSCI ACWI ® ex USA is a free float-adjusted market capitalization weighted index designed to measure the equity market performance of developed and emerging markets, excluding the United States. The Index includes reinvestment of dividends, net of foreign withholding taxes.  Investments cannot be made directly in the Index.

The performance data for Davis International Fund contained in this report represents past performance, assumes that all distributions were reinvested, and should not be considered as an indication of future performance from an investment in the Fund today. The investment return and principal value will fluctuate so that shares may be worth more or less than their original cost when redeemed. Fund performance changes over time and current performance may be higher or lower than stated. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The operating expense ratios may vary in future years. For more current information please call Davis Funds Investor Services at 1-800-279-0279.

*Reflects 4.75% front-end sales charge.

**Includes any applicable contingent deferred sales charge.

***Inception return is from December 29, 2006.



 
6
 
 
 
DAVIS GLOBAL FUND
Fund Overview
 
October 31, 2012
 


Portfolio Composition
 
Industry Weightings
(% of Fund’s 10/31/12 Net Assets)
 
(% of 10/31/12 Stock Holdings)
           
         
MSCI
       
Fund
ACWI ®
Common Stock (Foreign)
60.15%
 
Information Technology
11.40%
12.21%
Common Stock (U.S.)
38.47%
 
Food, Beverage & Tobacco
9.81%
6.50%
Stock Warrants
0.43%
 
Transportation
8.78%
1.98%
Preferred Stock (Foreign)
0.16%
 
Materials
7.97%
7.53%
Short-Term Investments
0.66%
 
Capital Goods
7.88%
7.41%
Other Assets & Liabilities
0.13%
 
Health Care
5.61%
9.52%
 
100.00%
 
Retailing
5.30%
2.78%
     
Media
5.28%
2.42%
     
Consumer Durables & Apparel
5.09%
1.37%
     
Diversified Financials
4.96%
4.32%
     
Energy
4.25%
11.03%
     
Real Estate
4.04%
2.99%
     
Banks
3.98%
9.17%
     
Insurance
3.94%
3.97%
     
Food & Staples Retailing
3.73%
2.33%
     
Telecommunication Services
3.65%
4.46%
     
Commercial & Professional Services
2.71%
0.82%
     
Other
1.62%
9.19%
       
100.00%
100.00%





Country Diversification
 
Top 10 Long-Term Holdings
(% of 10/31/12 Stock Holdings)
 
(% of Fund’s 10/31/12 Net Assets)
             
United States
39.21
%
 
Google Inc., Class A
5.88
%
China
14.59
%
 
Compagnie Financiere Richemont S.A., Bearer Shares, Unit A
4.66
%
Switzerland
11.78
%
 
Kuehne & Nagel International AG
4.54
%
Mexico
5.37
%
 
Heineken Holding N.V.
4.03
%
France
5.08
%
 
Hang Lung Group Ltd.
4.01
%
Netherlands
4.45
%
 
Schneider Electric S.A.
3.97
%
Hong Kong
4.04
%
 
America Movil, S.A.B. de C.V., Series L, ADR
3.62
%
Brazil
3.79
%
 
Walt Disney Co.
3.54
%
United Kingdom
3.51
%
 
Berkshire Hathaway Inc., Class B
3.16
%
Italy
2.81
%
 
Coca-Cola Co.
2.96
%
Canada
2.65
%
       
Belgium
1.57
%
       
Germany
1.15
%
       
 
100.00
%
       
             
             



 
7
 
 
 
DAVIS GLOBAL FUND – (CONTINUED)
Fund Overview
 
October 31, 2012
 


New Positions Added (11/01/11-10/31/12)
(Highlighted positions are those greater than 1.50% of Fund’s 10/31/12 net assets)
Security
Industry
 
Date of 1 st
Purchase
% of Fund’s
10/31/12
Net Assets
Air Products and Chemicals, Inc.
Materials
03/22/12
0.91%
Angie's List Inc.
Software & Services
05/15/12
1.13%
Brenntag AG
Capital Goods
07/20/12
1.14%
CETIP S.A. - Mercados Organizados
Capital Markets
02/28/12
0.79%
Ctrip.com International, Ltd., ADR
Consumer Services
05/31/12
1.59%
Diageo PLC
Food, Beverage & Tobacco
05/24/12
0.56%
Expedia, Inc.
Retailing
11/04/11
–
Expeditors International of Washington, Inc.
Transportation
04/17/12
2.13%
Groupon, Inc.
Retailing
11/03/11
0.86%
Oracle Corp.
Software & Services
12/21/11
0.63%
Schlumberger Ltd.
Energy
03/22/12
1.36%
Sysco Corp.
Food & Staples Retailing
03/06/12
1.12%
Tiffany & Co.
Retailing
01/23/12
1.58%
Vipshop Holdings Ltd., ADS
Retailing
03/23/12
0.58%



Positions Closed (11/01/11-10/31/12)
(Gains and losses greater than $1,000,000 are highlighted)
Security
Industry
Date of
Final Sale
Realized
Gain (Loss)
ABB Ltd., ADR
Capital Goods
04/24/12
$
480,309
ACE Ltd.
Property & Casualty Insurance
05/16/12
 
21,580
Banco Santander Brasil S.A., ADS
Commercial Banks
05/16/12
 
(151,846)
Bankrate Inc.
Software & Services
02/02/12
 
429,432
Blount International, Inc.
Capital Goods
05/24/12
 
355,211
China Shipping Development Co., Ltd. - H
Transportation
10/16/12
 
(1,502,109)
Clark Holdings, Inc.
Transportation
11/04/11
 
(2,375,904)
CVS Caremark Corp.
Food & Staples Retailing
07/13/12
 
1,096,464
Expedia, Inc.
Retailing
02/29/12
 
118,981
Itau Unibanco Holding S.A., ADR
Commercial Banks
05/16/12
 
(6,369)
Johnson & Johnson
Pharmaceuticals, Biotechnology &
     
 
   Life Sciences
12/22/11
 
(31,619)
Merck & Co., Inc.
Pharmaceuticals, Biotechnology &
     
 
   Life Sciences
12/21/11
 
334,752
Nestle S.A.
Food, Beverage & Tobacco
11/17/11
 
62,851
Roche Holding AG - Genusschein
Pharmaceuticals, Biotechnology &
     
 
   Life Sciences
03/28/12
 
60,777
RPX Corp.
Commercial & Professional Services
04/24/12
 
(248,898)
Schindler Holding AG -
       
   Participation Certificate
Capital Goods
05/22/12
 
72,799
Shandong Weigao Group Medical
       
   Polymer Co. Ltd. - H
Health Care Equipment & Services
06/04/12
 
(147,767)
Shanghai Electric Group Co. Ltd. - H
Capital Goods
08/02/12
 
(129,423)
Sino-Forest Corp.
Materials
07/10/12
 
(3,587,738)
TripAdvisor Inc.
Retailing
03/01/12
 
48,545
Unilever N.V.
Food, Beverage & Tobacco
03/01/12
 
74,827
Vale S.A., ADR
Materials
05/04/12
 
(37,267)
 
 
 
8
 
 
 
DAVIS INTERNATIONAL FUND
Fund Overview
 
October 31, 2012

 

Portfolio Composition
 
Industry Weightings
(% of Fund’s 10/31/12 Net Assets)
 
(% of 10/31/12 Stock Holdings)
           
         
MSCI
         
ACWI ®
       
Fund
EX USA
Common Stock (Foreign)
91.84%
 
Health Care
14.46%
7.37%
Common Stock (U.S.)
2.68%
 
Capital Goods
12.18%
7.33%
Preferred Stock (Foreign)
0.24%
 
Food, Beverage & Tobacco
10.66%
6.99%
Short-Term Investments
5.12%
 
Transportation
8.72%
2.26%
Other Assets & Liabilities
0.12%
 
Materials
8.30%
11.06%
 
100.00%
 
Consumer Durables & Apparel
5.85%
1.61%
     
Real Estate
5.03%
3.18%
     
Diversified Financials
4.89%
2.79%
     
Information Technology
4.66%
6.23%
     
Telecommunication Services
4.30%
5.63%
     
Food & Staples Retailing
4.00%
2.23%
     
Banks
3.95%
14.75%
     
Energy
3.75%
10.87%
     
Commercial & Professional Services
2.83%
0.88%
     
Media
2.34%
1.28%
     
Consumer Services
2.24%
0.94%
     
Other
1.84%
14.60%
       
100.00%
100.00%
           



Country Diversification
 
Top 10 Long-Term Holdings
(% of 10/31/12 Stock Holdings)
 
(% of Fund’s 10/31/12 Net Assets)
             
Switzerland
27.70
%
 
Kuehne & Nagel International AG
5.49
%
China
23.62
%
 
Heineken Holding N.V.
5.25
%
France
8.11
%
 
Schneider Electric S.A.
4.90
%
Mexico
6.64
%
 
Roche Holding AG - Genusschein
4.86
%
Netherlands
6.34
%
 
Compagnie Financiere Richemont S.A., Bearer Shares, Unit A
4.78
%
Brazil
5.55
%
 
Hang Lung Group Ltd.
4.77
%
Hong Kong
5.03
%
 
America Movil, S.A.B. de C.V., Series L, ADR
4.08
%
United Kingdom
3.82
%
 
Schindler Holding AG - Participation Certificate
3.96
%
Italy
3.64
%
 
Brazil Pharma S.A.
3.79
%
Canada
3.00
%
 
Tenaris S.A., ADR
3.45
%
United States
2.83
%
       
Belgium
2.59
%
       
Germany
1.13
%
       
 
100.00
%
       
             
             




 
9
 
 
 
DAVIS INTERNATIONAL FUND – (CONTINUED)
Fund Overview
 
October 31, 2012

 

New Positions Added (11/01/11-10/31/12)
(Highlighted positions are those greater than 2.00% of Fund’s 10/31/12 net assets)
Security
Industry
 
Date of 1 st
Purchase
% of Fund’s
10/31/12
Net Assets
Brenntag AG
Capital Goods
07/20/12
1.07%
CETIP S.A. - Mercados Organizados
Capital Markets
02/28/12
0.96%
Ctrip.com International, Ltd., ADR
Consumer Services
05/30/12
2.12%
Vipshop Holdings Ltd., ADS
Retailing
03/23/12
0.46%
       





Positions Closed (11/01/11-10/31/12)
(Losses greater than $1,000,000 are highlighted)
Security
Industry
Date of
Final Sale
Realized
Loss
Banco Santander Brasil S.A., ADS
Commercial Banks
05/16/12
$
(89,616)
China Shipping Development Co., Ltd. - H
Transportation
10/16/12
 
(604,763)
Itau Unibanco Holding S.A., ADR
Commercial Banks
05/16/12
 
(758)
Shanghai Electric Group Co. Ltd. - H
Capital Goods
08/02/12
 
(156,945)
Sino-Forest Corp.
Materials
07/10/12
 
(2,734,176)
Vale S.A., ADR
Materials
05/04/12
 
(73,857)
         
 

 
 
10
 
 
 
DAVIS GLOBAL FUND
Expense Example
DAVIS INTERNATIONAL FUND
 



Example

As a shareholder of each Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchases, contingent deferred sales charges on redemptions, and redemption fees, if any; and (2) ongoing costs, including advisory and administrative fees, distribution and/or service (12b-1) fees, and other Fund expenses.  The Expense Example is intended to help you understand your ongoing costs (in dollars) of investing in each Fund and to compare these costs with the ongoing costs of investing in other mutual funds.  The Expense Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period indicated, which for each class is for the six-month period ended October 31, 2012.

Actual Expenses

The information represented in the row entitled “Actual” provides information about actual account values and actual expenses.  You may use the information in this row, together with the amount you invested, to estimate the expenses that you paid over the period.  Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number under the heading “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.  An annual maintenance fee of $15, charged on retirement plan accounts per Social Security Number, is not included in the Expense Example.  This fee will be waived for accounts sharing the same Social Security Number if the accounts total at least $50,000 at Davis Funds.  If this fee was included, the estimate of expenses you paid during the period would be higher, and your ending account value would be lower, by this amount.

Hypothetical Example for Comparison Purposes

The information represented in the row entitled “Hypothetical” provides information about hypothetical account values and hypothetical expenses based on each Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return.  The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period.  You may use this information to compare the ongoing costs of investing in the Fund and other funds.  To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.  An annual maintenance fee of $15, charged on retirement plan accounts per Social Security Number, is not included in the Expense Example.  This fee will be waived for accounts sharing the same Social Security Number if the accounts total at least $50,000 at Davis Funds.  If this fee was included, the estimate of expenses you paid during the period would be higher, and your ending account value would be lower, by this amount.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as front-end or contingent deferred sales charges (loads) or redemption fees. Therefore, the information in the row entitled “Hypothetical” is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds.  In addition, if these transactional costs were included, your costs would have been higher.


 
11
 
 
 
DAVIS GLOBAL FUND
Expense Example – (Continued)
DAVIS INTERNATIONAL FUND
 


 
Beginning
Account Value
(05/01/12)
Ending
Account Value
(10/31/12)
Expenses Paid
During Period *  
(05/01/12-10/31/12)
Davis Global Fund
     
Class A (annualized expense ratio 1.05%**)
     
Actual
$1,000.00
$984.73
$5.24
Hypothetical
$1,000.00
$1,019.86
$5.33
Class B (annualized expense ratio 2.30%**)
     
Actual
$1,000.00
$978.03
$11.44
Hypothetical
$1,000.00
$1,013.57
$11.64
Class C (annualized expense ratio 2.00%**)
     
Actual
$1,000.00
$979.69
$9.95
Hypothetical
$1,000.00
$1,015.08
$10.13
Class Y (annualized expense ratio 0.76%**)
     
Actual
$1,000.00
$985.48
$3.79
Hypothetical
$1,000.00
$1,021.32
$3.86
       
       
Davis International Fund
     
Class A (annualized expense ratio 1.30%**)
     
Actual
$1,000.00
$985.75
$6.49
Hypothetical
$1,000.00
$1,018.60
$6.60
Class B (annualized expense ratio 2.30%**)
     
Actual
$1,000.00
$981.76
$11.46
Hypothetical
$1,000.00
$1,013.57
$11.64
Class C (annualized expense ratio 2.30%**)
     
Actual
$1,000.00
$980.54
$11.45
Hypothetical
$1,000.00
$1,013.57
$11.64
Class Y (annualized expense ratio 0.90%**)
     
Actual
$1,000.00
$987.98
$4.50
Hypothetical
$1,000.00
$1,020.61
$4.57
       


Hypothetical assumes 5% annual return before expenses.
 
*Expenses are equal to each Class's annualized operating expense ratio, multiplied by the average account value over the period, multiplied by 184/366 (to reflect the one-half year period).
 
**The expense ratios reflect the impact, if any, of certain reimbursements from the Adviser.
 

 
 
12
 

 
DAVIS GLOBAL FUND
Schedule of Investments
 
October 31, 2012
 
 

 
Shares
 
Value
(Note 1)
COMMON STOCK – (98.62%)
 
CONSUMER DISCRETIONARY – (17.14%)
 
Consumer Durables & Apparel – (5.05%)
 
Compagnie Financiere Richemont S.A., Bearer Shares, Unit A  (Switzerland)
   
90,400
 
$
5,862,944
 
Hunter Douglas N.V.  (Netherlands)
   
13,260
   
489,828
 
 
 
6,352,772
 
Consumer Services – (1.59%)
 
Ctrip.com International, Ltd., ADR  (China)*
   
100,300
   
2,007,003
 
Media – (5.24%)
 
Grupo Televisa S.A.B., ADR  (Mexico)
   
94,910
   
2,144,966
 
Walt Disney Co.
   
90,760
   
4,453,593
 
 
 
6,598,559
 
Retailing – (5.26%)
 
Groupon, Inc.  *
   
261,900
   
1,077,719
 
Netflix Inc.  *
   
35,570
   
2,817,144
 
Tiffany & Co.
   
31,470
   
1,989,534
 
Vipshop Holdings Ltd., ADS  (China)*
   
72,980
   
731,989
     
6,616,386
 
Total Consumer Discretionary
   
21,574,720
 
CONSUMER STAPLES – (13.44%)
 
Food & Staples Retailing – (3.71%)
 
Brazil Pharma S.A.  (Brazil)
   
535,400
   
3,255,553
 
Sysco Corp.
   
45,260
   
1,406,228
 
 
 
4,661,781
 
Food, Beverage & Tobacco – (9.73%)
 
Coca-Cola Co.
   
100,360
   
3,731,385
 
Diageo PLC  (United Kingdom)
   
24,868
   
710,715
 
Heineken Holding N.V.  (Netherlands)
   
99,929
   
5,070,822
 
Lindt & Spruengli AG - Participation Certificate  (Switzerland)
   
866
   
2,736,645
     
12,249,567
 
Total Consumer Staples
   
16,911,348
 
ENERGY – (4.22%)
 
OGX Petroleo e Gas Participacoes S.A.  (Brazil)*
   
42,750
   
99,137
 
Schlumberger Ltd.
   
24,560
   
1,707,657
 
Tenaris S.A., ADR  (Italy)
   
93,055
   
3,500,729
 
Total Energy
   
5,307,523
 
FINANCIALS – (16.36%)
 
Banks – (3.52%)
 
Commercial Banks – (3.52%)
 
China CITIC Bank Corp. Ltd. - H  (China)
   
1,483,302
   
757,914
 
China Merchants Bank Co., Ltd. - H  (China)
   
1,081,158
   
2,020,009
 
Wells Fargo & Co.
   
49,110
   
1,654,516
 
 
 
4,432,439


 
13
 
 

DAVIS GLOBAL FUND – (CONTINUED)
Schedule of Investments
 
October 31, 2012  


 
Shares/Units
 
Value
(Note 1)
COMMON STOCK – (CONTINUED)
 
FINANCIALS – (CONTINUED)
 
Diversified Financials – (4.92%)
 
Capital Markets – (3.05%)
 
Brookfield Asset Management Inc., Class A  (Canada)
   
18,600
 
$
640,584
 
CETIP S.A. - Mercados Organizados  (Brazil)
   
86,320
   
994,504
 
Charles Schwab Corp.
   
90,760
   
1,232,521
 
Oaktree Capital Group LLC, Class A
   
22,700
   
967,701
   
3,835,310
 
Diversified Financial Services – (1.87%)
 
Groupe Bruxelles Lambert S.A.  (Belgium)
   
16,293
   
1,202,890
 
Pargesa Holding S.A., Bearer Shares  (Switzerland)
   
5,846
   
394,211
 
RHJ International  (Belgium)*
   
152,205
   
757,557
   
2,354,658
 
 
 
6,189,968
 
Insurance – (3.91%)
 
Insurance Brokers – (0.23%)
 
CNinsure, Inc., ADR  (China)*
   
48,500
   
285,180
 
Multi-line Insurance – (0.52%)
 
Fairfax Financial Holdings Ltd.  (Canada)
   
1,765
   
655,706
 
Property & Casualty Insurance – (3.16%)
 
Berkshire Hathaway Inc., Class B  *
   
46,140
   
3,984,189
 
 
 
4,925,075
 
Real Estate – (4.01%)
 
Hang Lung Group Ltd.  (Hong Kong)
   
854,390
   
5,043,625
 
Total Financials
   
20,591,107
 
HEALTH CARE – (5.57%)
 
Health Care Equipment & Services – (4.13%)
 
Essilor International S.A.  (France)
   
15,022
   
1,354,191
 
IDEXX Laboratories, Inc.  *
   
19,928
   
1,916,974
 
Sinopharm Group Co. - H  (China)
   
572,700
   
1,928,693
 
 
 
5,199,858
 
Pharmaceuticals, Biotechnology & Life Sciences – (1.44%)
 
Sinovac Biotech Ltd.  (China)*
   
615,468
   
1,806,399
 
Total Health Care
   
7,006,257
 
INDUSTRIALS – (19.21%)
 
Capital Goods – (7.82%)
 
Brenntag AG  (Germany)
   
11,400
   
1,436,828
 
PACCAR Inc.
   
78,680
   
3,409,204
 
Schneider Electric S.A.  (France)
   
79,860
   
4,992,829
 
 
 
9,838,861
 
Commercial & Professional Services – (2.68%)
 
Nielsen Holdings N.V.  *
   
116,910
   
3,381,037
 
 

 
 
14
 
 
 
DAVIS GLOBAL FUND – (CONTINUED)
Schedule of Investments
 
October 31, 2012  


 
Shares/Units
 
Value
(Note 1)
COMMON STOCK – (CONTINUED)
 
INDUSTRIALS – (CONTINUED)
 
Transportation – (8.71%)
 
China Merchants Holdings International Co., Ltd.  (China)
   
716,671
 
$
2,376,558
 
Expeditors International of Washington, Inc.
   
73,400
   
2,686,440
 
Kuehne & Nagel International AG  (Switzerland)
   
48,985
   
5,717,459
 
LLX Logistica S.A.  (Brazil)*
   
162,440
   
181,551
     
10,962,008
 
Total Industrials
   
24,181,906
 
INFORMATION TECHNOLOGY – (11.31%)
 
Software & Services – (11.31%)
 
Angie's List Inc.  *
   
124,660
   
1,416,761
 
Google Inc., Class A  *
   
10,878
   
7,398,073
 
NetEase, Inc., ADR  (China)*
   
21,170
   
1,143,180
 
Oracle Corp.
   
25,590
   
794,698
 
Western Union Co.
   
98,870
   
1,255,649
 
Youku Tudou Inc., ADR  (China)*
   
112,570
   
2,228,886
     
14,237,247
 
Total Information Technology
   
14,237,247
 
MATERIALS – (7.75%)
 
Air Products and Chemicals, Inc.
   
14,700
   
1,139,691
 
BHP Billiton PLC  (United Kingdom)
   
60,789
   
1,947,740
 
Greatview Aseptic Packaging Co., Ltd.  (China)
   
5,585,330
   
2,925,973
 
Potash Corp. of Saskatchewan Inc.  (Canada)
   
49,940
   
2,016,078
 
Rio Tinto PLC  (United Kingdom)
   
34,420
   
1,724,402
 
Total Materials
   
9,753,884
 
TELECOMMUNICATION SERVICES – (3.62%)
 
America Movil, S.A.B. de C.V., Series L, ADR  (Mexico)
   
180,406
   
4,562,468
 
Total Telecommunication Services
   
4,562,468
 
 
TOTAL COMMON STOCK – (Identified cost $122,895,562)
 
 
124,126,460
PREFERRED STOCK – (0.16%)
 
MATERIALS – (0.16%)
 
MMX Mineracao e Metalicos S.A.  (Brazil)*
   
135,440
   
200,054
 
 
TOTOAL  PREFERRED STOCK – (Identified cost $221,978)
 
 
200,054
STOCK WARRANTS – (0.43%)
 
FINANCIALS – (0.43%)
 
Banks – (0.43%)
 
Commercial Banks – (0.43%)
 
Wells Fargo & Co., strike price $34.01, expires 10/28/18  *
   
56,400
   
539,748
 
 
TOTAL STOCK WARRANTS – (Identified cost $430,818)
 
 
539,748


 
15
 
 

DAVIS GLOBAL FUND – (CONTINUED)
Schedule of Investments
 
October 31, 2012  
 
 

 
Principal
 
Value
(Note 1)
SHORT-TERM INVESTMENTS – (0.66%)
 
Banc of America Securities LLC Joint Repurchase Agreement, 0.30%, 11/01/12, dated 10/31/12, repurchase value of $338,003 (collateralized by: U.S. Government agency mortgages in a pooled cash account, 2.789%-4.50%, 11/01/41-04/01/42, total market value $344,760)
 
$
338,000
 
$
338,000
 
Mizuho Securities USA Inc. Joint Repurchase Agreement, 0.33%, 11/01/12, dated 10/31/12, repurchase value of $493,005 (collateralized by: U.S. Government agency obligations in a pooled cash account, 1.75%-2.625%, 06/30/14-11/15/21, total market value $502,860)
   
493,000
   
493,000
 
 
TOTAL SHORT-TERM INVESTMENTS – (Identified cost $831,000)
 
 
831,000
 
Total Investments – (99.87%) – (Identified cost $124,379,358) – (a)
   
125,697,262
 
Other Assets Less Liabilities – (0.13%)
   
157,551
Net Assets – (100.00%)
   
$
125,854,813
 
 
ADR: American Depositary Receipt
 
 
 
ADS: American Depositary Share
 
 
 
*
 
Non-Income producing security.
 
 
(a)
 
Aggregate cost for federal income tax purposes is $126,122,799. At October 31, 2012 unrealized appreciation (depreciation) of securities for federal income tax purposes is as follows:
 
Unrealized appreciation
 
$
10,326,703
 
Unrealized depreciation
   
(10,752,240)
Net unrealized depreciation
   
$
(425,537)
 
See Notes to Financial Statements
 


 
16
 

 
DAVIS INTERNATIONAL FUND
Schedule of Investments
 
October 31, 2012


 
Shares
 
Value
(Note 1)
COMMON STOCK – (94.52%)
 
CONSUMER DISCRETIONARY – (10.34%)
 
Consumer Durables & Apparel – (5.54%)
 
Compagnie Financiere Richemont S.A., Bearer Shares, Unit A  (Switzerland)
   
37,250
 
$
2,415,870
 
Hunter Douglas N.V.  (Netherlands)
   
10,370
   
383,071
 
 
 
2,798,941
 
Consumer Services – (2.12%)
 
Ctrip.com International, Ltd., ADR  (China)*
   
53,500
   
1,070,535
 
Media – (2.22%)
 
Grupo Televisa S.A.B., ADR  (Mexico)
   
49,650
   
1,122,090
 
Retailing – (0.46%)
 
Vipshop Holdings Ltd., ADS  (China)*
   
23,290
   
233,598
 
Total Consumer Discretionary
   
5,225,164
 
CONSUMER STAPLES – (13.89%)
 
Food & Staples Retailing – (3.79%)
 
Brazil Pharma S.A.  (Brazil)
   
314,600
   
1,912,956
 
Food, Beverage & Tobacco – (10.10%)
 
Heineken Holding N.V.  (Netherlands)
   
52,270
   
2,652,402
 
Lindt & Spruengli AG - Participation Certificate  (Switzerland)
   
450
   
1,422,045
 
Nestle S.A.  (Switzerland)
   
16,210
   
1,028,681
     
5,103,128
 
Total Consumer Staples
   
7,016,084
 
ENERGY – (3.55%)
 
OGX Petroleo e Gas Participacoes S.A.  (Brazil)*
   
21,580
   
50,044
 
Tenaris S.A., ADR  (Italy)
   
46,350
   
1,743,687
 
Total Energy
   
1,793,731
 
FINANCIALS – (14.43%)
 
Banks – (3.74%)
 
Commercial Banks – (3.74%)
 
China CITIC Bank Corp. Ltd. - H  (China)
   
1,056,000
   
539,579
 
China Merchants Bank Co., Ltd. - H  (China)
   
723,069
   
1,350,964
 
 
 
1,890,543
 
Diversified Financials – (4.63%)
 
Capital Markets – (1.49%)
 
Brookfield Asset Management Inc., Class A  (Canada)
   
7,840
   
270,009
 
CETIP S.A. - Mercados Organizados  (Brazil)
   
42,000
   
483,888
   
753,897
 
Diversified Financial Services – (3.14%)
 
Groupe Bruxelles Lambert S.A.  (Belgium)
   
9,700
   
716,138
 
Pargesa Holding S.A., Bearer Shares  (Switzerland)
   
5,160
   
347,952
 
RHJ International  (Belgium)*
   
104,940
   
522,309
   
1,586,399
 
 
 
2,340,296



 
17
 
 

DAVIS INTERNATIONAL FUND – (CONTINUED)
Schedule of Investments
 
October 31, 2012  
 

 
Shares
 
Value
(Note 1)
COMMON STOCK – (CONTINUED)
 
FINANCIALS – (CONTINUED)
 
Insurance – (1.29%)
 
Insurance Brokers – (0.38%)
 
CNinsure, Inc., ADR  (China)*
   
32,270
 
$
189,747
 
Multi-line Insurance – (0.91%)
 
Fairfax Financial Holdings Ltd.  (Canada)
   
1,241
   
461,038
 
 
 
650,785
 
Real Estate – (4.77%)
 
Hang Lung Group Ltd.  (Hong Kong)
   
408,000
   
2,408,501
 
Total Financials
   
7,290,125
 
HEALTH CARE – (13.70%)
 
Health Care Equipment & Services – (6.72%)
 
Essilor International S.A.  (France)
   
15,610
   
1,407,198
 
Shandong Weigao Group Medical Polymer Co. Ltd. - H  (China)
   
310,000
   
419,197
 
Sinopharm Group Co. - H  (China)
   
466,800
   
1,572,052
 
 
 
3,398,447
 
Pharmaceuticals, Biotechnology & Life Sciences – (6.98%)
 
Roche Holding AG - Genusschein  (Switzerland)
   
12,760
   
2,453,899
 
Sinovac Biotech Ltd.  (China)*
   
365,170
   
1,071,774
     
3,525,673
 
Total Health Care
   
6,924,120
 
INDUSTRIALS – (22.49%)
 
Capital Goods – (11.54%)
 
ABB Ltd., ADR  (Switzerland)
   
45,090
   
814,325
 
Brenntag AG  (Germany)
   
4,300
   
541,962
 
Schindler Holding AG - Participation Certificate  (Switzerland)
   
15,200
   
2,002,620
 
Schneider Electric S.A.  (France)
   
39,560
   
2,473,282
 
 
 
5,832,189
 
Commercial & Professional Services – (2.68%)
 
Nielsen Holdings N.V.  *
   
46,900
   
1,356,348
 
Transportation – (8.27%)
 
China Merchants Holdings International Co., Ltd.  (China)
   
395,329
   
1,310,954
 
Kuehne & Nagel International AG  (Switzerland)
   
23,780
   
2,775,567
 
LLX Logistica S.A.  (Brazil)*
   
80,920
   
90,440
     
4,176,961
 
Total Industrials
   
11,365,498




 
18
 
 

DAVIS INTERNATIONAL FUND – (CONTINUED)
Schedule of Investments
 
October 31, 2012  
 

 
Shares/Principal
 
Value
(Note 1)
COMMON STOCK – (CONTINUED)
 
INFORMATION TECHNOLOGY – (4.41%)
 
Software & Services – (4.41%)
 
NetEase, Inc., ADR  (China)*
   
22,140
 
$
1,195,560
 
Youku Tudou Inc., ADR  (China)*
   
52,270
   
1,034,946
     
2,230,506
 
Total Information Technology
   
2,230,506
 
MATERIALS – (7.63%)
 
BHP Billiton PLC  (United Kingdom)
   
30,330
   
971,803
 
Greatview Aseptic Packaging Co., Ltd.  (China)
   
2,517,100
   
1,318,627
 
Potash Corp. of Saskatchewan Inc.  (Canada)
   
17,460
   
704,860
 
Rio Tinto PLC  (United Kingdom)
   
17,112
   
857,292
 
Total Materials
   
3,852,582
 
TELECOMMUNICATION SERVICES – (4.08%)
 
America Movil, S.A.B. de C.V., Series L, ADR  (Mexico)
   
81,420
   
2,059,112
 
Total Telecommunication Services
   
2,059,112
 
 
TOTAL COMMON STOCK – (Identified cost $47,724,166)
 
 
47,756,922
PREFERRED STOCK – (0.24%)
 
MATERIALS – (0.24%)
 
MMX Mineracao e Metalicos S.A.  (Brazil)*
   
80,920
   
119,524
 
 
TOTOAL  PREFERRED STOCK – (Identified cost $133,600)
 
 
119,524
SHORT-TERM INVESTMENTS – (5.12%)
 
Banc of America Securities LLC Joint Repurchase Agreement, 0.30%, 11/01/12, dated 10/31/12, repurchase value of $1,051,009 (collateralized by: U.S. Government agency mortgages in a pooled cash account, 2.789%-4.50%, 11/01/41-04/01/42, total market value $1,072,020)
 
$
1,051,000
   
1,051,000
 
Mizuho Securities USA Inc. Joint Repurchase Agreement, 0.33%, 11/01/12, dated 10/31/12, repurchase value of $1,537,014 (collateralized by: U.S. Government agency obligations in a pooled cash account, 1.75%-2.625%, 06/30/14-11/15/21, total market value $1,567,740)
   
1,537,000
   
1,537,000
 
 
TOTAL SHORT-TERM INVESTMENTS – (Identified cost $2,588,000)
 
 
2,588,000
 
Total Investments – (99.88%) – (Identified cost $50,445,766) – (a)
   
50,464,446
 
Other Assets Less Liabilities – (0.12%)
   
60,195
 
Net Assets – (100.00%)
 
$
50,524,641




 
19
 
 

DAVIS INTERNATIONAL FUND – (CONTINUED)
Schedule of Investments
 
October 31, 2012  
 
 


 
ADR: American Depositary Receipt
 
 
 
ADS: American Depositary Share
 
 
 
*
 
Non-Income producing security.
 
 
(a)
 
Aggregate cost for federal income tax purposes is $51,303,820. At October 31, 2012 unrealized appreciation (depreciation) of securities for federal income tax purposes is as follows:
 
Unrealized appreciation
 
$
3,760,096
 
Unrealized depreciation
   
(4,599,470)
 
Net unrealized depreciation
 
$
(839,374)
 
See Notes to Financial Statements
 

 

 
20
 
 
 
DAVIS GLOBAL FUND
Statements of Assets and Liabilities
DAVIS INTERNATIONAL FUND
At October 31, 2012
 
 

               
     
Davis Global
Fund
   
Davis International
Fund
 
ASSETS:
           
Investments in securities at value* (see accompanying Schedules of Investments)
 
$
125,697,262
 
$
50,464,446
Cash
   
2,871
   
1,615
Cash - foreign currencies**
   
24
   
–
Receivables:
           
 
Capital stock sold
   
200,950
   
271
 
Dividends and interest
   
209,432
   
159,257
Prepaid expenses
   
2,719
   
1,372
Due from Adviser
   
212
   
536
 
Total assets
   
126,113,470
   
50,627,497
 
LIABILITIES:
           
Payables:
           
 
Capital stock redeemed
   
84,238
   
–
Accrued audit fees
   
14,580
   
14,580
Accrued custodian fees
   
15,600
   
12,600
Accrued distribution and service plan fees
   
11,804
   
867
Accrued management fee
   
63,938
   
25,916
Accrued registration and filing fees
   
36,540
   
35,000
Accrued transfer agent fees
   
18,145
   
4,009
Other accrued expenses
   
13,812
   
9,884
  Total liabilities    
258,657
   
102,856
 
NET ASSETS
 
$
125,854,813
 
$
50,524,641
 
NET ASSETS CONSIST OF:
           
Par value of shares of capital stock
 
$
489,227
 
$
307,144
Additional paid-in capital
   
146,769,413
   
58,093,244
Undistributed net investment income (loss)
   
472,914
   
(3,089)
Accumulated net realized losses from investments
   
(23,191,192)
   
(7,888,095)
Net unrealized appreciation on investments and foreign currency transactions
   
1,314,451
   
15,437
  Net Assets  
$
125,854,813
 
$
50,524,641
               
*Including:
           
 
Cost of investments
 
$
124,379,358
 
$
50,445,766
               
**Cost of cash - foreign currencies
   
24
   
–
               




 
21
 

 
DAVIS GLOBAL FUND
Statements of Assets and Liabilities – (Continued)
DAVIS INTERNATIONAL FUND
At October 31, 2012


 

     
Davis Global
Fund
   
Davis International
Fund
 
CLASS A SHARES:
             
Net assets
 
$
30,825,599
 
$
3,386,641
Shares outstanding
   
2,390,228
   
408,060
Net asset value and redemption price per share (Net assets ÷ Shares outstanding)
 
$
 12.90
 
$
 8.30
Maximum offering price per share (100/95.25 of net asset value)†
 
$
 13.54
 
$
 8.71
 
CLASS B SHARES:
             
Net assets
 
$
1,508,582
 
$
110,078
Shares outstanding
   
120,983
   
13,644
Net asset value, offering, and redemption price per share (Net assets ÷ Shares outstanding)
 
$
 12.47
 
$
 8.07
 
CLASS C SHARES:
             
Net assets
 
$
7,718,194
 
$
233,489
Shares outstanding
   
615,722
   
28,959
Net asset value, offering, and redemption price per share (Net assets ÷ Shares outstanding)
 
$
 12.54
 
$
 8.06
 
CLASS Y SHARES:
             
Net assets
 
$
85,802,438
 
$
46,794,433
Shares outstanding
   
6,657,610
   
5,692,217
Net asset value, offering, and redemption price per share (Net assets ÷ Shares outstanding)
 
$
 12.89
 
$
 8.22
                 
†On purchases of $100,000 or more, the offering price is reduced.
 
 
See Notes to Financial Statements


 
22
 
 
 
DAVIS GLOBAL FUND
Statements of Operations
DAVIS INTERNATIONAL FUND
For the year ended October 31, 2012
 
               
     
Davis Global
Fund
   
Davis International
Fund
INVESTMENT INCOME:
           
Income:
           
Dividends*
 
$
2,002,376
 
$
892,149
Interest
   
7,598
   
2,921
 
Total income
   
2,009,974
   
895,070
               
Expenses:
           
Management fees (Note 3)
   
733,546
   
265,785
Custodian fees
   
100,675
   
64,255
Transfer agent fees:
           
 
Class A
   
49,113
   
8,957
 
Class B
   
11,916
   
3,145
 
Class C
   
21,452
   
3,525
 
Class Y
   
5,850
   
3,101
Audit fees
   
19,440
   
19,440
Legal fees
   
312
   
114
Accounting fees (Note 3)
   
3,000
   
3,000
Reports to shareholders
   
19,107
   
7,311
Directors’ fees and expenses
   
6,008
   
3,924
Registration and filing fees
   
95,640
   
55,996
Miscellaneous
   
11,149
   
11,655
Payments under distribution plan (Note 7):
           
 
Class A
   
47,601
   
6,214
 
Class B
   
17,661
   
1,252
 
Class C
   
85,195
   
1,770
Total expenses
   
1,227,665
   
459,444
Expenses paid indirectly (Note 4)
   
(9)
   
(2)
Reimbursement of expenses by Adviser (Note 3)
   
(1,984)
   
(7,646)
 
Net expenses
   
1,225,672
   
451,796
Net investment income
   
784,302
   
443,274
               
REALIZED & UNREALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS:
           
Net realized gain (loss) from:
           
 
Investment transactions
   
3,906,015
   
(4,233,580)
 
Foreign currency transactions
   
(8,546)
   
(5,489)
Net realized gain (loss)
   
3,897,469
   
(4,239,069)
Net change in unrealized appreciation (depreciation)
   
2,924,464
   
6,518,590
 
Net realized and unrealized gain on investments and foreign currency transactions
   
6,821,933
   
2,279,521
Net increase in net assets resulting from operations
 
$
7,606,235
 
$
2,722,795
               
*Net of foreign taxes withheld as follows
 
$
150,556
 
$
102,647
 
See Notes to Financial Statements


 
23
 

 
DAVIS GLOBAL FUND
Statements of Changes in Net Assets
DAVIS INTERNATIONAL FUND
For the year ended October 31, 2012



     
Davis Global
Fund
   
Davis International
Fund
               
OPERATIONS:
           
Net investment income
 
$
784,302
 
$
443,274
Net realized gain (loss) from investments and foreign currency transactions
   
3,897,469
   
(4,239,069)
Net change in unrealized appreciation (depreciation) on investments and foreign currency transactions
   
2,924,464
   
6,518,590
 
Net increase in net assets resulting from operations
   
7,606,235
   
2,722,795
               
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS FROM:
           
Net investment income:
           
 
Class A
   
(90,761)
   
(50,514)
 
Class Y
   
(531,315)
   
(642,988)
               
CAPITAL SHARE TRANSACTIONS:
           
Net increase (decrease) in net assets resulting from capital share transactions (Note 5):
           
 
Class A
   
(1,537,409)
   
255,214
 
Class B
   
(550,650)
   
(30,693)
 
Class C
   
(2,110,021)
   
5,108
 
Class Y
   
(7,780,324)
   
757,853
 
Total increase (decrease) in net assets
   
(4,994,245)
   
3,016,775
               
NET ASSETS:
           
Beginning of year
   
130,849,058
   
47,507,866
End of year *
 
$
125,854,813
 
$
50,524,641
               
*Including undistributed net investment income (loss) of
 
$
472,914
 
$
(3,089)
 
 
See Notes to Financial Statements


 
24
 
 
 
DAVIS GLOBAL FUND
Statements of Changes in Net Assets
DAVIS INTERNATIONAL FUND
For the year ended October 31, 2011
 
 

     
Davis Global
Fund
   
Davis International
Fund
               
OPERATIONS:
           
Net investment income
 
$
741,303
 
$
421,535
Net realized gain from investments and foreign currency transactions
   
2,991,972
   
474,955
Net change in unrealized appreciation (depreciation) on investments and foreign currency transactions
   
(11,277,255)
   
(8,520,369)
 
Net decrease in net assets resulting from operations
   
(7,543,980)
   
(7,623,879)
               
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS FROM:
           
Net investment income:
           
 
Class A
   
(879,741)
   
(216,908)
 
Class B
   
(18,046)
   
–
 
Class C
   
(99,078)
   
–
 
Class Y
   
(538,343)
   
(3,637)
               
CAPITAL SHARE TRANSACTIONS:
           
Net increase (decrease) in net assets resulting from capital share transactions (Note 5):
           
 
Class A
   
(16,931,102)
   
(49,661,879)
 
Class B
   
(1,057,940)
   
74,653
 
Class C
   
(1,663,666)
   
235,728
 
Class Y
   
71,088,314
   
53,388,838
 
Total increase (decrease) in net assets
   
42,356,418
   
(3,807,084)
               
NET ASSETS:
           
Beginning of year
   
88,492,640
   
51,314,950
End of year *
 
$
130,849,058
 
$
47,507,866
               
*Including undistributed net investment income (loss) of
 
$
(488,887)
 
$
252,628
 
 
See Notes to Financial Statements


 
25
 
 
 
DAVIS GLOBAL FUND
Notes to Financial Statements
DAVIS INTERNATIONAL FUND
October 31, 2012
 
 
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Davis New York Venture Fund, Inc. (a Maryland corporation) (“Company”), is registered under the Investment Company Act of 1940, as amended, as a diversified, open-end management investment company.  The Company operates as a series issuing shares of common stock including the following two funds (collectively “Funds”):

Davis Global Fund seeks to achieve long-term growth of capital.  It invests primarily in equity securities issued by both United States and foreign companies, including countries with developed or emerging markets. The Fund commenced operations on December 22, 2004, and until January 1, 2007, shares of the Fund were not available for public sale.

Davis International Fund seeks to achieve long-term growth of capital.  It invests primarily in equity securities issued by foreign companies, including countries with developed or emerging markets. The Fund commenced operations on December 29, 2006, and until January 1, 2010, shares of the Fund were not available for public sale.

Because of the risk inherent in any investment program, the Company cannot ensure that the investment objective of its Funds will be achieved.

Prior to being available for public sale, only the directors, officers, and employees of the Funds or their investment adviser and sub-adviser (and the investment adviser itself and affiliated companies) were eligible to purchase the Funds’ shares.

The Company accounts separately for the assets, liabilities, and operations of each Fund.  Each Fund offers shares in four classes, Class A, Class B, Class C, and Class Y.  Class A shares are sold with a front-end sales charge and Class B and Class C shares are sold at net asset value and may be subject to a contingent deferred sales charge upon redemption. Class B shares automatically convert to Class A shares after 7 years.  After April 30, 2013, Class B shares will no longer be offered for new purchases. New Class B share account applications will be returned and any investments for existing Class B share accounts that are received after that date will be made in Class A shares of Davis Government Money Market Fund. Investors may continue to exchange Class B shares of other Davis Funds for Class B shares of Davis Global Fund or Davis International Fund and to exchange Davis Global Fund or Davis International Fund Class B shares for Class B shares of other Davis Funds.  Class Y shares are sold at net asset value and are not subject to any contingent deferred sales charge.  Class Y shares are only available to certain qualified investors.  Income, expenses (other than those attributable to a specific class), and gains and losses, are allocated daily to each class of shares based upon the relative proportion of net assets represented by each class.  Operating expenses directly attributable to a specific class, such as distribution and transfer agent fees, are charged against the operations of that class. All classes have identical rights with respect to voting (exclusive of each class’s distribution arrangement), liquidation, and distributions. Each Fund assesses a 2% fee on the proceeds of Fund shares that are redeemed (either by selling or exchanging to another Davis Fund) within 30 days of their purchase. The fee, which is retained by each Fund, is accounted for as an addition to paid-in capital. The following is a summary of significant accounting policies followed by the Funds in the preparation of their financial statements.

Security Valuation - The Funds calculate the net asset value of their shares as of the close of the New York Stock Exchange (“Exchange”), normally 4:00 P.M. Eastern time, on each day the Exchange is open for business. Securities listed on the Exchange (and other national exchanges) are valued at the last reported sales price on the day of valuation. Securities traded in the over-the-counter market (e.g. NASDAQ) and listed securities for which no sale was reported on that date are stated at the average of closing bid and asked prices. Securities traded on foreign exchanges are valued based upon the last sales price on the principal exchange on which the security is traded prior to the time when the Funds’ assets are valued. Securities (including restricted securities) for which market quotations are not readily available are valued at their fair value.  Securities whose values have been materially affected by what Davis Selected Advisers, L.P. (“Davis Advisors” or “Adviser”), the Funds’ investment adviser, identifies as a significant event occurring before the Funds’ assets are valued, but after the close of their respective exchanges will be fair valued.  Fair value is determined in good faith using consistently applied procedures under the supervision of the Board of Directors. These procedures include certain standardized methodologies to fair value securities. Short-term securities purchased within 60 days to maturity are valued at amortized cost, which approximates market value.  These valuation procedures are reviewed and subject to approval by the Board of Directors. There have been no significant changes to the fair valuation procedures during the period.



 
26
 
 
 
DAVIS GLOBAL FUND
Notes to Financial Statements – (Continued)
DAVIS INTERNATIONAL FUND
October 31, 2012

 
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – (CONTINUED)

Value Measurements - Fair value is defined as the price that the Funds would receive upon selling an investment in an orderly transaction to an independent buyer in the principal market for the investment. Various inputs are used to determine the fair value of the Funds’ investments. These inputs are summarized in the three broad levels listed below.
 
 
Level 1 – quoted prices in active markets for identical securities
 
Level 2 – other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.)
 
Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of investments)

The inputs or methodologies used for valuing securities are not necessarily an indication of the risk associated with investing in those securities nor can it be assured that the Funds can obtain the fair value assigned to a security if they were to sell the security.

The following is a summary of the inputs used as of October 31, 2012 in valuing each Fund’s investments carried at value:
 
       
 
Investments in Securities at Value
 
Davis
 
Davis
 
Global
 
International
 
Fund
 
Fund
Valuation inputs
         
Level 1 – Quoted Prices:
         
Equity securities :
         
Consumer discretionary
$
21,574,720
 
$
5,225,164
Consumer staples
 
16,911,348
   
7,016,084
Energy
 
5,307,523
   
1,793,731
Financials
 
21,130,855
   
7,290,125
Health care
 
7,006,257
   
6,924,120
Industrials
 
24,181,906
   
11,365,498
Information technology
 
14,237,247
   
2,230,506
Materials
 
9,953,938
   
3,972,106
Telecommunication services
 
4,562,468
   
2,059,112
Total Level 1
 
124,866,262
   
47,876,446
           
Level 2 – Other Significant Observable Inputs:
         
Short-term securities
 
831,000
   
2,588,000
Total Level 2
 
831,000
   
2,588,000
           
Level 3 – Significant Unobservable Inputs:
 
–
   
–
Total Investments
$
125,697,262
 
$
50,464,446
           

Level 2 to Level 1 Transfers * :
         
Consumer discretionary
$
6,352,772
 
$
2,798,941
Consumer staples
 
7,807,467
   
5,103,128
Financials
 
11,143,907
   
5,885,443
Health care
 
3,282,884
   
5,852,346
Industrials
 
13,086,846
   
8,562,423
Materials
 
6,598,115
   
3,147,722
Total
$
48,271,991
 
$
31,350,003
           
 
*The application of fair value procedures for securities traded on foreign exchanges and the initial public offering of an investment triggered the transfers of assets (or investments) between Level 1 and Level 2 of the fair value hierarchy during the year ended October 31, 2012.
 
 
 
 
27
 
 
 
DAVIS GLOBAL FUND
Notes to Financial Statements – (Continued)
DAVIS INTERNATIONAL FUND
October 31, 2012
 
 
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – (CONTINUED)

 
Value Measurements - (Continued)

The following table reconciles the valuation of assets in which significant unobservable inputs (Level 3) were used in determining fair value during the year ended October 31, 2012:

   
Davis
Global
Fund
 
Davis
International  
Fund
Investment Securities:
           
Beginning balance
 
$
195,533
 
$
119,508
Net realized loss
   
(3,587,738)
   
(2,734,176)
Decrease in unrealized depreciation
   
3,392,205
   
2,614,668
Ending balance
 
$
–
 
$
–
             
             

There were no transfers of assets (or investments) into or out of Level 3 of the fair value hierarchy during the period. Realized and unrealized gains (losses) are included in the related amounts on investments in the Statements of Operations.

Master Repurchase Agreements - The Funds, along with other affiliated funds, may transfer uninvested cash balances into one or more master repurchase agreement accounts. These balances are invested in one or more repurchase agreements, secured by U.S. Government securities. A custodian bank holds securities pledged as collateral for repurchase agreements until the agreements mature. Each agreement requires that the market value of the collateral be sufficient to cover payments of interest and principal; however, in the event of default by the other party to the agreement, retention of the collateral may be subject to legal proceedings.

Currency Translation - The market values of all assets and liabilities denominated in foreign currencies are recorded in the financial statements after translation to the U.S. Dollar based upon the mean between the bid and offered quotations of the currencies against U.S. Dollars on the date of valuation. The cost basis of such assets and liabilities is determined based upon historical exchange rates. Income and expenses are translated at average exchange rates in effect as accrued or incurred.

Foreign Currency   - The Funds may enter into forward purchases or sales of foreign currencies to hedge certain foreign currency denominated assets and liabilities against declines in market value relative to the U.S. Dollar. Forward currency contracts are marked-to-market daily and the change in market value is recorded by the Funds as an unrealized gain or loss. When the forward currency contract is closed, the Funds record a realized gain or loss equal to the difference between the value of the forward currency contract at the time it was opened and value at the time it was closed. Investments in forward currency contracts may expose the Funds to risks resulting from unanticipated movements in foreign currency exchange rates or failure of the counter-party to the agreement to perform in accordance with the terms of the contract.

Reported net realized foreign exchange gains or losses arise from the sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions, the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Funds’ books, and the U.S. Dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains and losses arise from changes in the value of assets and liabilities other than investments in securities at fiscal year end, resulting from changes in the exchange rate. The Funds include foreign currency gains and losses realized on the sales of investments together with market gains and losses on such investments in the Statements of Operations.
 
Federal Income Taxes   - It is each Fund’s policy to comply with the requirements of the Internal Revenue Code applicable to regulated investment companies, and to distribute substantially all of its taxable income, including any net realized gains on investments not offset by loss carryovers, to shareholders. Therefore, no provision for federal income or excise tax is required. The Adviser has analyzed the Funds’ tax positions taken on federal and state income tax returns for all open tax years and has concluded that as of October 31, 2012, no provision for income tax is required in the Funds’ financial statements related to these tax positions. The Funds’ federal and state (Arizona and Maryland) income and federal excise tax returns for tax years for which the applicable statutes of limitations have not expired are subject to examination by the Internal Revenue Service and state departments of revenue. The earliest tax year that remains subject to examination by these jurisdictions is 2009.
 
 
 
 
28
 
 
 
DAVIS GLOBAL FUND
Notes to Financial Statements – (Continued)
DAVIS INTERNATIONAL FUND
October 31, 2012
 
 
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – (CONTINUED)

Federal Income Taxes - (Continued)

The Regulated Investment Company Modernization Act of 2010 (“Act”) was enacted on December 22, 2010. The Act made changes to several tax rules impacting the Funds. Although the Act provides several benefits, including the unlimited carryforward of future capital losses, there may be a greater likelihood that all or a portion of each Fund’s pre-enactment capital loss carryforwards may expire without being utilized due to the fact that post-enactment capital losses are required to be utilized before pre-enactment capital loss carryforwards.  At October 31, 2012, each Fund had available for federal income tax purposes unused capital loss carryforwards as follows:
 

 
Capital Loss Carryforwards
 
Davis Global Fund
 
Davis International Fund
Pre-Enactment Expiring
         
10/31/2016
$
5,191,000
 
$
784,000
10/31/2017
 
15,593,000
   
2,187,000
10/31/2018
 
1,785,000
   
657,000
Post-Enactment
         
Short-term
 
–
   
170,000
Long-term
 
–
   
4,064,000
Total
$
22,569,000
 
$
7,862,000

 
Utilized
         
During the year ended October 31, 2012
$
2,880,000
 
$
–

Securities Transactions and Related Investment Income   - Securities transactions are accounted for on the trade date (date the order to buy or sell is executed) with realized gain or loss on the sale of securities being determined based upon identified cost. Dividend income is recorded on the ex-dividend date. Dividend income from REIT securities may include return of capital. Upon notification from the issuer, the amount of the return of capital is reclassified to adjust dividend income, reduce the cost basis, and/or adjust realized gain/loss. Interest income, which includes accretion of discount and amortization of premium, is accrued as earned.

Dividends and Distributions to Shareholders - Dividends and distributions to shareholders are recorded on the ex-dividend date.  Net investment income (loss), net realized gains (losses), and net unrealized appreciation (depreciation) on investments may differ for financial statement and tax purposes primarily due to differing treatments of wash sales, foreign currency transactions, partnership income, and passive foreign investment company shares. The character of dividends and distributions made during the fiscal year from net investment income and net realized securities gains may differ from their ultimate characterization for federal income tax purposes.  Also, due to the timing of dividends and distributions, the fiscal year in which amounts are distributed may differ from the fiscal year in which income or realized gain was recorded by the Funds.  The Funds adjust certain components of capital to reflect permanent differences between financial statement amounts and net income and realized gains/losses determined in accordance with income tax rules.  Accordingly, during the year ended October 31, 2012, for Davis Global Fund, amounts have been reclassified to reflect a decrease in undistributed net investment loss of $799,575 and a corresponding increase to accumulated net realized losses from investments and foreign currency transactions; for Davis International Fund, amounts have been reclassified to reflect an increase in undistributed net investment loss of $5,489 and a corresponding decrease to accumulated net realized losses from investments and foreign currency transactions. The Funds’ net assets have not been affected by these reclassifications.

The tax character of distributions paid during the years ended October 31, 2012 and 2011 was as follows:
 
 
Ordinary
Income
 
Long-Term
Capital Gain
 
Return of
Capital
 
Total
Davis Global Fund
                     
2012
$
622,076
 
$
–
 
$
–
 
$
622,076
2011
 
1,535,208
   
–
   
–
   
1,535,208
                       
Davis International Fund
                     
2012
 
693,502
   
–
   
–
   
693,502
2011
 
220,545
   
–
   
–
   
220,545


 
29
 

 
DAVIS GLOBAL FUND
Notes to Financial Statements – (Continued)
DAVIS INTERNATIONAL FUND
October 31, 2012
 
 
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – (CONTINUED)

Dividends and Distributions to Shareholders - (Continued)

As of October 31, 2012, the components of distributable earnings (accumulated losses) on a tax basis were as follows:
 
 
Davis
Global
Fund
 
Davis
International
Fund
Undistributed net investment income
$
1,597,136
 
$
829,873
Accumulated net realized losses from investments and foreign currency transactions
 
(22,568,990)
   
(7,861,756)
Net unrealized depreciation on investments
 
(428,991)
   
(842,617)
Total
$
(21,400,845)
 
$
(7,874,500)
           

Indemnification - Under the Funds’ organizational documents, their officers and directors are indemnified against certain liabilities arising out of the performance of their duties to the Funds. In addition, some of the Funds’ contracts with their service providers contain general indemnification clauses. The Funds’ maximum exposure under these arrangements is unknown since the amount of any future claims that may be made against the Funds cannot be determined and the Funds have no historical basis for predicting the likelihood of any such claims.

Use of Estimates in Financial Statements   - In preparing financial statements in conformity with accounting principles generally accepted in the United States of America, management makes estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of income and expenses during the reporting period. Actual results may differ from these estimates.

Directors Fees and Expenses - The Funds set up a Rabbi Trust to provide for the deferred compensation plan for Independent Directors that enables them to elect to defer receipt of all or a portion of annual fees they are entitled to receive. The value of an eligible Director’s account is based upon years of service and fees paid to each Director during the years of service. The amount paid to the Director by the Trust under the plan will be determined based upon the performance of the Davis Funds in which the amounts are invested.

NOTE 2 - PURCHASES AND SALES OF SECURITIES

The cost of purchases and proceeds from sales of investment securities (excluding short-term securities) during the year ended October 31, 2012 were as follows:

 
Davis
Global Fund
 
Davis
International Fund
Cost of purchases
$
54,927,755
 
$
3,606,791
Proceeds from sales
 
60,371,235
   
4,270,994

 


 
30
 
 

DAVIS GLOBAL FUND
Notes to Financial Statements – (Continued)
DAVIS INTERNATIONAL FUND
October 31, 2012
 

NOTE 3 - INVESTMENT ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES

Advisory fees are paid monthly to the Adviser.  The annual rate for each Fund is 0.55% of the average net assets.

Boston Financial Data Services, Inc. (“BFDS”) is the Funds’ primary transfer agent.  The Adviser is also paid for certain transfer agent services.  The fee paid to the Adviser for these services during the year ended October 31, 2012 for Davis Global Fund and Davis International Fund amounted to $7,358 and $869, respectively.  State Street Bank and Trust Company (“State Street Bank”) is the Funds’ primary accounting provider.  Fees for such services are included in the custodian fees as State Street Bank also serves as the Funds’ custodian.  The Adviser is also paid for certain accounting services.  The fee paid to the Adviser for these services during the year ended October 31, 2012 for Davis Global Fund and Davis International Fund amounted to $3,000 each.  The Adviser is contractually committed to waive fees and/or reimburse the Funds’ expenses to the extent necessary to cap total annual Fund operating expenses (Class A shares, 1.30%; Class B shares, 2.30%; Class C shares, 2.30%; Class Y shares, 1.05%).  During the year ended October 31, 2012, such reimbursements for Davis Global Fund amounted to $1,984 for Class B and Davis International Fund amounted to $2,211, $2,630, and $2,805 for Class A, Class B, and Class C, respectively.  Certain directors and officers of the Funds are also directors and officers of the general partner of the Adviser.

Davis Selected Advisers-NY, Inc. (“DSA-NY”), a wholly-owned subsidiary of the Adviser, acts as sub-adviser to the Funds.  DSA-NY performs research and portfolio management services for the Funds under a Sub-Advisory Agreement with the Adviser.  The Funds pay no fees directly to DSA-NY.

NOTE 4 - EXPENSES PAID INDIRECTLY

Under an agreement with State Street Bank, custodian fees are reduced for earnings on cash balances maintained at the custodian by the Funds.  Such reductions amounted to $9 and $2 for Davis Global Fund and Davis International Fund, respectively, during the year ended October 31, 2012.

NOTE 5 - CAPITAL STOCK

At October 31, 2012, there were 3.5 billion shares of capital stock ($0.05 par value per share) authorized for Davis New York Venture Fund, Inc., of which 175 million shares each are designated to Davis Global Fund and Davis International Fund.   Transactions in capital stock were as follows:

Class A
 
Year ended October 31, 2012
     
Davis Global
Fund
   
Davis International
Fund
Shares sold
   
403,890
   
105,308
Shares issued in reinvestment of distributions
   
7,023
   
6,403
     
410,913
   
111,711
Shares redeemed
   
(521,110)
   
(78,960)
 
Net increase (decrease)
   
(110,197)
   
32,751
               
Proceeds from shares sold
 
$
4,915,831
 
$
845,994
Proceeds from shares issued in reinvestment of distributions
   
83,641
   
48,084
     
4,999,472
   
894,078
Cost of shares redeemed*
   
(6,536,881)
   
(638,864)
 
Net increase (decrease)
 
$
(1,537,409)
 
$
255,214
               
* Net of redemption fees as follows
 
$
426
 
$
–
               

 

 
 
31
 


DAVIS GLOBAL FUND
Notes to Financial Statements – (Continued)
DAVIS INTERNATIONAL FUND
October 31, 2012
 
 

NOTE 5 - CAPITAL STOCK – (CONTINUED)

Class A
 
Year ended October 31, 2011
     
Davis Global
Fund
   
Davis International
Fund
Shares sold
   
600,592
   
301,752
Shares issued in reinvestment of distributions
   
60,389
   
22,593
     
660,981
   
324,345
Shares redeemed
   
(1,892,648)
   
(5,486,660)
 
Net decrease
   
(1,231,667)
   
(5,162,315)
               
Proceeds from shares sold
 
$
8,215,798
 
$
2,882,908
Proceeds from shares issued in reinvestment of distributions
   
832,768
   
216,891
     
9,048,566
   
3,099,799
Cost of shares redeemed*
   
(25,979,668)
   
(52,761,678)
 
Net decrease
 
$
(16,931,102)
 
$
(49,661,879)
               
* Net of redemption fees as follows
 
$
284
 
$
–
               
Class B
 
Year ended October 31, 2012
     
Davis Global
Fund
   
Davis International
Fund
Shares sold
   
12,405
   
3,489
Shares issued in reinvestment of distributions
   
–
   
–
     
12,405
   
3,489
Shares redeemed
   
(58,342)
   
(7,361)
 
Net decrease
   
(45,937)
   
(3,872)
               
Proceeds from shares sold
 
$
155,484
 
$
27,916
Proceeds from shares issued in reinvestment of distributions
   
–
   
–
     
155,484
   
27,916
Cost of shares redeemed*
   
(706,134)
   
(58,609)
 
Net decrease
 
$
(550,650)
 
$
(30,693)
               
* Net of redemption fees as follows
 
$
–
 
$
345
               
Class B
 
Year ended October 31, 2011
     
Davis Global
Fund
   
Davis International
Fund
Shares sold
   
25,083
   
14,441
Shares issued in reinvestment of distributions
   
1,246
   
–
     
26,329
   
14,441
Shares redeemed
   
(107,400)
   
(5,518)
 
Net increase (decrease)
   
(81,071)
   
8,923
               
Proceeds from shares sold
 
$
325,910
 
$
124,958
Proceeds from shares issued in reinvestment of distributions
   
17,489
   
–
     
343,399
   
124,958
Cost of shares redeemed
   
(1,401,339)
   
(50,305)
 
Net increase (decrease)
 
$
(1,057,940)
 
$
74,653
               
 
 
 
32
 
 
 
DAVIS GLOBAL FUND
Notes to Financial Statements – (Continued)
DAVIS INTERNATIONAL FUND
October 31, 2012
 
 
NOTE 5 - CAPITAL STOCK – (CONTINUED)
               
Class C
 
Year ended October 31, 2012
     
Davis Global
Fund
   
Davis International
Fund
Shares sold
   
38,191
   
12,389
Shares issued in reinvestment of distributions
   
–
   
–
     
38,191
   
12,389
Shares redeemed
   
(209,348)
   
(12,023)
 
Net increase (decrease)
   
(171,157)
   
366
               
Proceeds from shares sold
 
$
470,172
 
$
97,465
Proceeds from shares issued in reinvestment of distributions
   
–
   
–
     
470,172
   
97,465
Cost of shares redeemed*
   
(2,580,193)
   
(92,357)
 
Net increase (decrease)
 
$
(2,110,021)
 
$
5,108
               
* Net of redemption fees as follows
 
$
6
 
$
51
               
Class C
 
Year ended October 31, 2011
     
Davis Global
Fund
   
Davis International
Fund
Shares sold
   
150,314
   
31,485
Shares issued in reinvestment of distributions
   
7,036
   
–
     
157,350
   
31,485
Shares redeemed
   
(293,051)
   
(8,600)
 
Net increase (decrease)
   
(135,701)
   
22,885
               
Proceeds from shares sold
 
$
2,051,526
 
$
297,080
Proceeds from shares issued in reinvestment of distributions
   
95,692
   
–
     
2,147,218
   
297,080
Cost of shares redeemed*
   
(3,810,884)
   
(61,352)
 
Net increase (decrease)
 
$
(1,663,666)
 
$
235,728
               
* Net of redemption fees as follows
 
$
1,286
 
$
4
               
Class Y
 
Year ended October 31, 2012
     
Davis Global
Fund
   
Davis International
Fund
Shares sold
   
1,558,945
   
32,065
Shares issued in reinvestment of distributions
   
44,280
   
86,773
     
1,603,225
   
118,838
Shares redeemed
   
(2,196,236)
   
(17,578)
 
Net increase (decrease)
   
(593,011)
   
101,260
               
Proceeds from shares sold
 
$
20,280,573
 
$
250,976
Proceeds from shares issued in reinvestment of distributions
   
525,600
   
642,988
     
20,806,173
   
893,964
Cost of shares redeemed*
   
(28,586,497)
   
(136,111)
 
Net increase (decrease)
 
$
(7,780,324)
 
$
757,853
               
* Net of redemption fees as follows
 
$
200
 
$
–
 
 
 
 
 
33
 
 
 
DAVIS GLOBAL FUND
Notes to Financial Statements – (Continued)
DAVIS INTERNATIONAL FUND
October 31, 2012
 

NOTE 5 - CAPITAL STOCK – (CONTINUED)
               
Class Y
 
Year ended October 31, 2011
     
Davis Global
Fund
   
Davis International
Fund
Shares sold
   
5,538,256
   
5,562,203
Shares issued in reinvestment of distributions
   
38,439
   
378
     
5,576,695
   
5,562,581
Shares redeemed
   
(96,564)
   
(16,079)
 
Net increase
   
5,480,131
   
5,546,502
               
Proceeds from shares sold
 
$
71,866,575
 
$
53,536,342
Proceeds from shares issued in reinvestment of distributions
   
528,916
   
3,637
     
72,395,491
   
53,539,979
Cost of shares redeemed*
   
(1,307,177)
   
(151,141)
 
Net increase
 
$
71,088,314
 
$
53,388,838
               
* Net of redemption fees as follows
 
$
50
 
$
–

NOTE 6 - BANK BORROWINGS

Each Fund may borrow up to 5% of its assets from a bank to purchase portfolio securities, or for temporary and emergency purposes. The purchase of securities with borrowed funds creates leverage in the Fund. Each Fund has entered into an agreement, which enables it to participate with certain other funds managed by the Adviser in an unsecured line of credit with a bank, which permits borrowings up to $50 million, collectively. Interest is charged based on its borrowings, at a rate equal to the higher of the Federal Funds Rate or the Overnight Libor Rate, plus 1.25%. The Funds had no borrowings during the year ended October 31, 2012.

NOTE 7 - DISTRIBUTION AND UNDERWRITING FEES

Class A Shares of Davis Global Fund and Davis International Fund - Class A shares of the Funds are sold at net asset value plus a sales charge and are redeemed at net asset value.

Davis Distributors, LLC, the Funds’ Underwriter (“Underwriter” or “Distributor”), received commissions earned on sales of Class A shares of the Funds of which a portion was retained by the Underwriter and the remaining was re-allowed to investment dealers.

The Underwriter is reimbursed for amounts paid to dealers as a service fee or commissions with respect to Class A shares sold by dealers, which remain outstanding during the period. The service fee is paid at the annual rate up to 1/4 of 1.00% of the average net assets maintained by the responsible dealers.

 
Year ended October 31, 2012
       
 
Davis
 
Davis
 
Global
 
International
 
Fund
 
Fund
Commissions retained by Underwriter
$
3,068
 
$
1,548
Commissions re-allowed to investment dealers
 
16,945
   
7,102
Total commissions earned on sales of Class A shares
$
20,013
 
$
8,650
           
Class A service fee
$
47,601
 
$
6,214
           


 
34
 
 
 
DAVIS GLOBAL FUND
Notes to Financial Statements – (Continued)
DAVIS INTERNATIONAL FUND
October 31, 2012
 

NOTE 7 - DISTRIBUTION AND UNDERWRITING FEES – (CONTINUED)

Class B Shares of Davis Global Fund and Davis International Fund - Class B shares of the Funds are sold at net asset value and are redeemed at net asset value.  A contingent deferred sales charge may be assessed on shares redeemed within six years of purchase.

The Funds pay the Distributor a distribution fee on Class B shares at an annual rate equal to the lesser of 1.25% of the average daily net asset value of the Class B shares or the maximum amount provided by applicable rule or regulation of the Financial Industry Regulatory Authority, Inc. (“FINRA”), which currently is 1.00%.  The Funds pay the distribution fee on Class B shares in order: (i) to pay the Distributor commissions on Class B shares which have been sold and (ii) to enable the Distributor to pay service fees on Class B shares which have been sold.

Commission advances by the Distributor on the sale of Class B shares are re-allowed to qualified selling dealers.

A contingent deferred sales charge is imposed upon redemption of certain Class B shares of the Funds within six years of the original purchase. The charge is a declining percentage starting at 4.00% of the lesser of net asset value of the shares redeemed or the total cost of such shares.

 
Year ended October 31, 2012
       
 
Davis
 
Davis
 
Global
 
International
 
Fund
 
Fund
Distribution Plan Payments:
         
Distribution fees
$
13,278
 
$
942
Service fees
 
4,383
   
310
Commission advances by the Distributor
         
on the sale of Class B shares
 
2,410
   
44
Contingent deferred sales charges received by the
         
Distributor from Class B shares
 
3,541
   
345
           

Class C Shares of Davis Global Fund and Davis International Fund - Class C shares of the Funds are sold at net asset value and are redeemed at net asset value.  A contingent deferred sales charge may be assessed on shares redeemed within the first year of purchase.

The Funds pay the Distributor a distribution fee on Class C shares at an annual rate equal to the lesser of 1.25% of the average daily net asset value of the Class C shares or the maximum amount provided by applicable rule or regulation of the FINRA, which currently is 1.00%.  The Funds pay the distribution fee on Class C shares in order: (i) to pay the Distributor commissions on Class C shares which have been sold and (ii) to enable the Distributor to pay service fees on Class C shares which have been sold.

Commission advances by the Distributor on the sale of Class C shares are re-allowed to qualified selling dealers.





 
35
 
 

DAVIS GLOBAL FUND
Notes to Financial Statements – (Continued)
DAVIS INTERNATIONAL FUND
October 31, 2012
 

NOTE 7 - DISTRIBUTION AND UNDERWRITING FEES – (CONTINUED)

Class C Shares of Davis Global Fund and Davis International Fund - (Continued)

A contingent deferred sales charge of 1.00% is imposed upon redemption of certain Class C shares of the Funds within the first year of the original purchase.

 
Year ended October 31, 2012
           
   
Davis
   
Davis
   
Global
   
International
   
Fund
   
Fund
Distribution Plan Payments:
         
Distribution fees
$
63,896
 
$
1,328
Service fees
 
21,299
   
442
Commission advances by the Distributor
         
on the sale of Class C shares
 
2,745
   
646
Contingent deferred sales charges received by the
         
Distributor from Class C shares
 
462
   
303
           




 
36
 
 
 
DAVIS GLOBAL FUND
DAVIS INTERNATIONAL FUND
 
The following financial information represents selected data for each share of capital stock outstanding throughout each period:
 
    Income (Loss) from Investment Operations
 
Net Asset Value, Beginning of
Period
Net Investment
Income (Loss)
Net Realized and Unrealized Gains
(Losses)
Total from
Investment
Operations
Davis Global Fund Class A:
       
Year ended October 31, 2012
$12.25
$0.06 d
$0.63
$0.69
Year ended October 31, 2011
$13.32
$0.09 d
$(0.93)
$(0.84)
Year ended October 31, 2010
$11.28
$0.09 d
$2.04
$2.13
Year ended October 31, 2009
$8.51
$0.07 d
$2.75
$2.82
Year ended October 31, 2008
$18.70
$0.15 d
$(10.16)
$(10.01)
Davis Global Fund Class B:
       
Year ended October 31, 2012
$11.96
$(0.09) d
$0.60
$0.51
Year ended October 31, 2011
$13.01
$(0.06) d
$(0.91)
$(0.97)
Year ended October 31, 2010
$11.07
$(0.06) d
$2.00
$1.94
Year ended October 31, 2009
$8.39
$(0.02) d
$2.70
$2.68
Year ended October 31, 2008
$18.52
$(0.01) d
$(10.02)
$(10.03)
Davis Global Fund Class C:
       
Year ended October 31, 2012
$11.99
$(0.06) d
$0.61
$0.55
Year ended October 31, 2011
$13.03
$(0.02) d
$(0.91)
$(0.93)
Year ended October 31, 2010
$11.07
$(0.03) d
$1.99
$1.96
Year ended October 31, 2009
$8.39
$(0.02) d
$2.70
$2.68
Year ended October 31, 2008
$18.52
$0.01 d
$(10.04)
$(10.03)
Davis Global Fund Class Y:
       
Year ended October 31, 2012
$12.24
$0.09 d
$0.63
$0.72
Year ended October 31, 2011
$13.30
$0.14 d
$(0.94)
$(0.80)
Year ended October 31, 2010
$11.27
$0.12 d
$2.03
$2.15
Year ended October 31, 2009
$8.51
$0.08 d
$2.76
$2.84
Year ended October 31, 2008
$18.71
$0.20 d
$(10.17)
$(9.97)
Davis International Fund Class A:
       
Year ended October 31, 2012
$8.02
$0.05 d
$0.37
$0.42
Year ended October 31, 2011
$9.17
$(0.04) d
$(1.07)
$(1.11)
Year ended October 31, 2010
$7.89
$0.03 d
$1.33
$1.36
Year ended October 31, 2009
$6.15
$0.07
$1.79
$1.86
Year ended October 31, 2008
$13.48
$0.15
$(7.37)
$(7.22)
Davis International Fund Class B:
       
Year ended October 31, 2012
$7.74
$(0.04) d
$0.37
$0.33
Year ended October 31, 2011
$9.08
$(0.05) d
$(1.29)
$(1.34)
Year ended October 31, 2010
$7.82
$(0.02) d
$1.29
$1.27
Year ended October 31, 2009
$6.06
$– e
$1.78
$1.78
Year ended October 31, 2008
$13.36
$0.04
$(7.29)
$(7.25)

 
37
 
 
 
Financial Highlights
 
 
 
 
Dividends and Distributions          Ratios to Average Net Assets   
Dividends
from Net
Investment
Income
Distributions
from
Realized
Gains
Return of
Capital
Total
Distributions
Net Asset
Value, End
of Period
Total Return a
Net Assets,
 End of Period
(in thousands)
Gross
Expense
Ratio
Net Expense
Ratio b
Net
Investment
Income
(Loss) Ratio
Portfolio
Turnover c
                     
$(0.04)
$–
$–
$(0.04)
$12.90
5.63%
$30,826
1.05%
1.05%
0.46%
43%
$(0.23)
$–
$–
$(0.23)
$12.25
(6.48)%
$30,638
1.03%
1.03%
0.72%
28%
$(0.09)
$–
$–
$(0.09)
$13.32
18.96%
$49,697
1.06%
1.06%
0.76%
28%
$(0.05)
$–
$–
$(0.05)
$11.28
33.32%
$41,456
1.31%
1.30%
0.73%
32%
$(0.08)
$(0.10)
$–
$(0.18)
$8.51
(54.01)%
$32,172
1.26%
1.26%
1.07%
19%
                     
$–
$–
$–
$–
$12.47
4.26%
$1,509
2.41%
2.30%
(0.79)%
43%
$(0.08)
$–
$–
$(0.08)
$11.96
(7.56)%
$1,996
2.23%
2.23%
(0.48)%
28%
$–
$–
$–
$–
$13.01
17.52%
$3,226
2.27%
2.27%
(0.45)%
28%
$–
$–
$–
$–
$11.07
31.94%
$3,034
2.57%
2.30%
(0.27)%
32%
$–
$(0.10)
$–
$(0.10)
$8.39
(54.43)%
$2,721
2.30%
2.30%
(0.05)%
19%
                     
$–
$–
$–
$–
$12.54
4.59%
$7,718
1.99%
1.99%
(0.48)%
43%
$(0.11)
$–
$–
$(0.11)
$11.99
(7.26)%
$9,431
1.96%
1.96%
(0.21)%
28%
$–
$–
$–
$–
$13.03
17.70%
$12,022
2.05%
2.05%
(0.23)%
28%
$–
$–
$–
$–
$11.07
31.94%
$9,570
2.33%
2.30%
(0.27)%
32%
$–
$(0.10)
$–
$(0.10)
$8.39
(54.43)%
$10,548
2.19%
2.19%
0.05%
19%
                     
$(0.07)
$–
$–
$(0.07)
$12.89
5.96%
$85,802
0.75%
0.75%
0.76%
43%
$(0.26)
$–
$–
$(0.26)
$12.24
(6.24)%
$88,784
0.76%
0.76%
0.99%
28%
$(0.12)
$–
$–
$(0.12)
$13.30
19.13%
$23,548
0.83%
0.83%
0.99%
28%
$(0.08)
$–
$–
$(0.08)
$11.27
33.70%
$14,012
1.04%
1.04%
0.99%
32%
$(0.13)
$(0.10)
$–
$(0.23)
$8.51
(53.91)%
$8,364
1.04%
1.04%
1.29%
19%
                     
$(0.14)
$–
$–
$(0.14)
$8.30
5.39%
$3,387
1.37%
1.30%
0.55%
8%
$(0.04)
$–
$–
$(0.04)
$8.02
(12.19)%
$3,012
0.94%
0.94%
(0.44)%
14%
$(0.08)
$–
$–
$(0.08)
$9.17
17.32%
$50,776
1.81%
1.30%
0.41%
20%
$(0.12)
$–
$–
$(0.12)
$7.89
30.80%
$13,121
1.38%
1.30%
1.04%
25%
$(0.06)
$(0.05)
$–
$(0.11)
$6.15
(53.97)%
$10,045
1.25%
1.25%
1.42%
13%
                     
$–
$–
$–
$–
$8.07
4.26%
$110
4.40%
2.30%
(0.45)%
8%
$–
$–
$–
$–
$7.74
(14.76)%
$136
5.31%
2.30%
(0.60)%
14%
$(0.01)
$–
$–
$(0.01)
$9.08
16.25%
$78
8.05%
2.30%
(0.59)%
20%
$(0.02)
$–
$–
$(0.02)
$7.82
29.54%
$2
9.98%
2.30%
0.04%
25%
$–
$(0.05)
$–
$(0.05)
$6.06
(54.46)%
$2
7.27%
2.30%
0.37%
13%

 
38
 
 
 
DAVIS GLOBAL FUND
DAVIS INTERNATIONAL FUND
 
The following financial information represents selected data for each share of capital stock outstanding throughout each period:
 
    Income (Loss) from Investment Operations
 
Net Asset Value, Beginning of
Period
Net Investment
Income (Loss)
Net Realized and Unrealized Gains
(Losses)
Total from
Investment
Operations
Davis International Fund Class C:
       
Year ended October 31, 2012
$7.73
$(0.04) d
$0.37
$0.33
Year ended October 31, 2011
$9.08
$(0.05) d
$(1.30)
$(1.35)
Year ended October 31, 2010
$7.82
$– d,e
$1.27
$1.27
Year ended October 31, 2009
$6.07
$– e
$1.77
$1.77
Year ended October 31, 2008
$13.37
$0.04
$(7.29)
$(7.25)
Davis International Fund Class Y:
       
Year ended October 31, 2012
$7.89
$0.08 d
$0.37
$0.45
Year ended October 31, 2011
$9.19
$0.14 d
$(1.38)
$(1.24)
Period from December 31,2009 f to October 31, 2010
$8.40
$0.08 d
$0.71
$0.79

a
Assumes hypothetical initial investment on the business day before the first day of the fiscal period (or inception of offering), with all dividends and distributions reinvested in additional shares on the reinvestment date, and redemption at the net asset value calculated on the last business day of the fiscal period. Sales charges are not reflected in the total returns. Total returns are not annualized for periods of less than one year.
 
b
The ratios in this column reflect the impact, if any, of the reduction of expenses paid indirectly and of certain reimbursements from the Adviser.
 
c
The lesser of purchases or sales of portfolio securities for a period, divided by the monthly average of the market value of portfolio securities owned during the period. Securities with a maturity or expiration date at the time of acquisition of one year or less are excluded from the calculation.


 
39
 
 
 
Financial Highlights – (Continued)
 
 
 
 
Dividends and Distributions         Ratios to Average Net Assets   
Dividends
from Net
Investment
Income
Distributions
from
Realized
Gains
Return of
Capital
Total
Distributions
Net Asset
Value, End
of Period
Total Return a
Net Assets,
End of Period
(in thousands)
Gross
Expense
Ratio
Net Expense
Ratio b
Net
Investment
Income
(Loss) Ratio
Portfolio
Turnover c
                     
$–
$–
$–
$–
$8.06
4.27%
$233
3.88%
2.30%
(0.45)%
8%
$–
$–
$–
$–
$7.73
(14.87)%
$221
3.13%
2.30%
(0.58)%
14%
$(0.01)
$–
$–
$(0.01)
$9.08
16.25%
$52
9.91%
2.30%
(0.59)%
20%
$(0.02)
$–
$–
$(0.02)
$7.82
29.32%
$2
10.17%
2.30%
0.04%
25%
$–
$(0.05)
$–
$(0.05)
$6.07
(54.42)%
$2
7.31%
2.30%
0.37%
13%
                     
$(0.12)
$–
$–
$(0.12)
$8.22
5.80%
$46,794
0.90%
0.90%
0.95%
8%
$(0.06)
$–
$–
$(0.06)
$7.89
(13.61)%
$44,140
0.89%
0.89%
1.52%
14%
$–
$–
$–
$–
$9.19
9.40%
$409
2.92% g
1.05% g
1.14% g
20%

d
Per share calculations were based on average shares outstanding for the period.
 
e
Less than $0.005 per share.
 
f
Inception date of class.
 
g
Annualized.
 
 
See Notes to Financial Statements
 


 
40
 
 
 
DAVIS NEW YORK VENTURE FUND, INC.
Report of Independent Registered Public Accounting Firm
 
 


The Shareholders and Board of Directors
Davis New York Venture Fund, Inc.:

We have audited the accompanying statements of assets and liabilities of Davis Global Fund and Davis International Fund (each a series comprising Davis New York Venture Fund, Inc.), including the schedules of investments, as of October 31, 2012, and the related statements of operations for the year then ended, the statements of changes in net assets for each of the years in the two-year period then ended, and the financial highlights for each of the years or periods in the five-year period then ended.  These financial statements and financial highlights are the responsibility of the Funds’ management.  Our responsibility is to express an opinion on these fi­nancial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of October 31, 2012, by correspondence with the custodian. An audit also includes assessing the accounting principles used and signifi­cant estimates made by management, as well as evaluating the overall financial statement presentation.  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 Davis Global Fund and Davis International Fund as of October 31, 2012, the results of their operations for the year then ended, the changes in their net assets for each of the years in the two-year period then ended, and the financial highlights for each of the years or periods in the five-year period then ended, in conformity with U.S. generally accepted accounting principles.



KPMG LLP

Denver, Colorado
December 20, 2012



 


 
41
 
 
 
DAVIS GLOBAL FUND
Federal Income Tax Information (Unaudited)
DAVIS INTERNATIONAL FUND
 


In early 2013, shareholders will receive information regarding all dividends and distributions paid to them by the Funds during calendar year 2012.  Regulations of the U.S. Treasury Department require the Funds to report this information to the Internal Revenue Service.

The information and distributions reported herein may differ from the information reported as distributions taxable to certain shareholders for the calendar year 2012 with their 2012 Form 1099-DIV.
 
The information is presented to assist shareholders in reporting distributions received from the Funds to the Internal Revenue Service.  Because of the complexity of the federal regulations that may affect your individual tax return and the many variations in state and local regulations, we recommend that you consult your tax adviser for specific guidance.

The Funds have elected to give the benefit of foreign tax credits to their shareholders. Accordingly, shareholders who must report their gross income dividends and distributions in a federal tax return will be entitled to a foreign tax credit, or an itemized deduction, in computing their U.S. income tax liability. It is generally more advantageous to claim a credit rather than to take a deduction.

Davis Global Fund

During the fiscal year 2012, $622,076 of dividends paid by the Fund constituted income dividends for federal income tax purposes. The Fund designates $450,218 or 72% as income qualifying for the corporate dividends-received deduction.

For the fiscal year 2012, certain dividends paid by the Fund constitute qualified dividend income for federal income tax purposes. The Fund designates $622,076 or 100% as qualified dividend income.

Pursuant to Section 853 of the Internal Revenue Code, Davis Global Fund designates $112,142 as foreign taxes paid during the year ended October 31, 2012.  Approximately 73% of the ordinary income distribution deemed to be paid during the fiscal year ended October 31, 2012 was derived from foreign sourced income of $1,581,861.  The Fund did not derive any income from ineligible foreign sources as defined under Section 901(j) of the Internal Revenue Code.  Foreign taxes paid for purposes of Section 853 may be less than actual foreign taxes paid for financial statement purposes.

Davis International Fund

During the fiscal year 2012, $693,502 of dividends paid by the Fund constituted income dividends for federal income tax purposes, of which no amount qualified for the corporate dividends-received deduction.

For the fiscal year 2012, certain dividends paid by the Fund constitute qualified dividend income for federal income tax purposes. The Fund designates $693,082 or 100% as qualified dividend income.

Pursuant to Section 853 of the Internal Revenue Code, Davis International Fund designates $83,368 as foreign taxes paid during the year ended October 31, 2012.  Approximately 100% of the ordinary income distribution deemed to be paid during the fiscal year ended October 31, 2012 was derived from foreign sourced income of $996,998.  The Fund did not derive any income from ineligible foreign sources as defined under Section 901(j) of the Internal Revenue Code.  Foreign taxes paid for purposes of Section 853 may be less than actual foreign taxes paid for financial statement purposes.



 
42
 
 
 
DAVIS GLOBAL FUND
Fund Information
DAVIS INTERNATIONAL FUND
 


Portfolio Proxy Voting Policies and Procedures

The Funds have adopted Portfolio Proxy Voting Policies and Procedures under which the Funds vote proxies relating to securities held by the Funds. A description of the Funds’ Portfolio Proxy Voting Policies and Procedures is available (i) without charge, upon request, by calling the Funds toll-free at 1-800-279-0279, (ii) on the Funds’ website at www.davisfunds.com, and (iii) on the SEC’s website at www.sec.gov.

In addition, the Funds are required to file Form N-PX, with their complete proxy voting record for the 12 months ended June 30 th , no later than August 31 st of each year. The Funds’ Form N-PX filing is available (i) without charge, upon request, by calling the Funds toll-free at 1-800-279-0279, (ii) on the Funds’ website at www.davisfunds.com, and (iii) on the SEC’s website at www.sec.gov.

Form N-Q

The Funds file their complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The Funds’ Form N-Q is available without charge, upon request, by calling 1-800-279-0279, on the Funds’ website at www.davisfunds.com, and on the SEC’s website at www.sec.gov. The Funds’ Form N-Q may be reviewed and copied at the SEC’s Public Reference Room in Washington, DC, and information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330.


 
43
 
 
 
DAVIS GLOBAL FUND
Privacy Notice and Householding
DAVIS INTERNATIONAL FUND
 
 
 

Privacy Notice

While you generally will be dealing with a broker-dealer or other financial adviser, we may collect information about you from your account application and other forms that you may deliver to us. We use this information to process your requests and transactions; for example, to provide you with additional information about our Funds, to open an account for you, or to process a transaction. In order to service your account and execute your transactions, we may provide your personal information to firms that assist us in servicing your account, such as our transfer agent. We may also provide your name and address to one of our agents for the purpose of mailing to you your account statement and other information about our products and services. We require these outside firms and agents to protect the confidentiality of your information and to use the information only for the purpose for which the disclosure is made. We do not provide customer names and addresses to outside firms, organizations, or individuals except in furtherance of our business relationship with you or as otherwise allowed by law.

We restrict access to nonpublic personal information about you to those employees who need to know that information to provide products or services to you. We maintain physical, electronic, and procedural safeguards that comply with federal standards to guard your personal information.

Householding

To avoid sending duplicate copies of materials to households, the Funds will mail only one copy of each prospectus, Annual, and Semi-Annual Report to shareholders having the same last name and address on the Funds’ records. The consolidation of these mailings, called householding, benefits the Funds through reduced mailing expense. If you do not want the mailing of these documents to be combined with those to other members of your household, please contact the Davis Funds by phone at 1-800-279-0279. Individual copies of current prospectuses and reports will be sent to you within 30 days after the Funds receive your request to stop householding.


 
44
 
 
 
DAVIS GLOBAL FUND
Directors and Officers
DAVIS INTERNATIONAL FUND
 
 
 

For the purposes of their service as directors to the Davis Funds, the business address for each of the directors is 2949 E. Elvira Road, Suite 101, Tucson, AZ 85756. Each Director serves until their retirement, resignation, death, or removal. Subject to exceptions and exemptions, which may be granted by the Independent Directors, Directors must retire at the close of business on the last day of the calendar year in which the Director attains age seventy-four (74).

Name
(birthdate)
Position(s) Held
With Fund
Term of Office
and Length of
Time Served
Principal Occupation(s)
During Past Five Years
Number of Portfolios
in Fund Complex
Overseen by Director
Other Directorships
Held by Director
           
Independent Directors
           
Marc P. Blum
(09/09/42)
Director
Director since 1986
Chief Executive Officer, World Total Return Fund, LLLP; of Counsel to Gordon Feinblatt LLC (law firm).
13
Director, Legg Mason Investment Counsel & Trust Company, N.A. (asset management company) and Rodney Trust Company (Delaware).
           
John S. Gates, Jr.
(08/02/53)
Director
Director since 2007
Chairman and Chief Executive Officer of PortaeCo LLC, a private investment company (beginning in 2006); Co-founder of CenterPoint Properties Trust (REIT); Co-chairman and Chief Executive Officer for 22 years (until 2006).
13
 
Director, DCT Industrial Trust (REIT); Chairman, Regional Transportation Authority of Chicago.
           
Thomas S. Gayner
(12/16/61)
Director/
Chairman
Director since 2004
President and Chief Investment Officer, Markel Corp. (diversified financial holding company).
13
Director, Washington Post Co. (publishing company); Director, Colfax Corp. (engineering and manufacturer of pumps and fluid handling equipment).
           
Samuel H. Iapalucci
(07/19/52)
Director
Director since 2006
Former Executive Vice President and Chief Financial Officer, CH2M-HILL Companies, Ltd. (engineering).
13
Director, Trow Global Holdings Inc. (engineering &
consulting).
           
Robert P. Morgenthau
(03/22/57)
Director
Director since 2002
Principal, Spears Abacus Advisors, LLC (investment management firm) since August 2011; former Chairman, NorthRoad Capital Management, LLC (investment management firm).
13
none
           
Marsha Williams
(03/28/51)
Director
Director since 1999
Retired; former Senior Vice President and Chief Financial Officer, Orbitz Worldwide, Inc. (travel-services provider) 2007-2010; former Executive Vice President and Chief Financial Officer, Equity Office Properties Trust (REIT) 2002-2007.
13
Director, Modine Manufacturing, Inc. (heat transfer technology); Director, Chicago Bridge & Iron Co., N.V. (industrial construction and engineering); Director, Fifth Third Bancorp (diversified financial services).





 
45
 
 

DAVIS GLOBAL FUND
Directors and Officers – (Continued)
DAVIS INTERNATIONAL FUND
 
 

 
Name
(birthdate)
Position(s)  Held
With Fund
Term of Office
and Length of
Time Served
Principal Occupation(s)
During Past Five Years
Number of Portfolios
in Fund Complex
Overseen by Director
Other Directorships
Held by Director
           
Inside Directors *
           
Andrew A. Davis
(06/25/63)
Director
Director since 1997
President or Vice President of each Davis Fund and Selected Fund; President, Davis Selected Advisers, L.P., and also serves as an executive officer in certain companies affiliated with the Adviser.
16
Director, Selected Funds (consisting of three portfolios) since 1998.
           
Christopher C. Davis
(07/13/65)
Director
Director since 1997
President or Vice President of each Davis Fund, Selected Fund, and Clipper Fund; Chairman, Davis Selected Advisers, L.P., and also serves as an executive officer in certain companies affiliated with the Adviser, including sole member of the Adviser’s general partner, Davis Investments, LLC; Employee of Shelby Cullom Davis & Co. (registered broker/dealer).
16
Director, Selected Funds (consisting of three portfolios) since 1998; Director, Washington Post Co. (publishing company).

*   Andrew A. Davis and Christopher C. Davis own partnership units (directly, indirectly, or both) of the Adviser and are considered to be “interested persons” of the Funds as defined in the Investment Company Act of 1940. Andrew A. Davis and Christopher C. Davis are brothers.

Officers

Andrew A. Davis (born 06/25/63, Davis Funds officer since 1997). See description in the section on Inside Directors.

Christopher C. Davis (born 07/13/65, Davis Funds officer since 1997). See description in the section on Inside Directors.
 
Kenneth C. Eich (born 08/14/53, Davis Funds officer since 1997). Executive Vice President and Principal Executive Officer of each of the Davis Funds (consisting of 13 portfolios), Selected Funds (consisting of three portfolios), and Clipper Fund, Inc. (consisting of one portfolio); Chief Operating Officer, Davis Selected Advisers, L.P., and also serves as an executive officer in certain companies affiliated with the Adviser.

Douglas A. Haines (born 03/04/71, Davis Funds officer since 2004). Vice President, Treasurer, Chief Financial Officer, Principal Financial Officer, and Principal Accounting Officer of each of the Davis Funds (consisting of 13 portfolios), Selected Funds (consisting of three portfolios), and Clipper Fund, Inc. (consisting of one portfolio); Vice President and Director of Fund Accounting, Davis Selected Advisers, L.P.

Sharra L. Haynes (born 09/25/66, Davis Funds officer since 1997). Vice President and Chief Compliance Officer of each of the Davis Funds (consisting of 13 portfolios), Selected Funds (consisting of three portfolios), and Clipper Fund, Inc. (consisting of one portfolio); Vice President and Chief Compliance Officer, Davis Selected Advisers, L.P., and also serves as an executive officer in certain companies affiliated with the Adviser.

Thomas D. Tays (born 03/07/57, Davis Funds officer since 1997). Vice President and Secretary of each of the Davis Funds (consisting of 13 portfolios), Selected Funds (consisting of three portfolios), and Clipper Fund, Inc. (consisting of one portfolio); Vice President, Chief Legal Officer, and Secretary, Davis Selected Advisers, L.P., and also serves as an executive officer in certain companies affiliated with the Adviser.

Arthur Don (born 09/24/53, Davis Funds officer since 1991). Assistant Secretary (for clerical purposes only) of each of the Davis Funds and Selected Funds; Shareholder, Greenberg Traurig, LLP (law firm); counsel to the Independent Directors and the Davis Funds.

 
46
 
 
 
DAVIS GLOBAL FUND
DAVIS INTERNATIONAL FUND
 
 

Investment Adviser
 
Davis Selected Advisers, L.P. (Doing business as “Davis Advisors”)
 
2949 East Elvira Road, Suite 101
 
Tucson, Arizona 85756
 
(800) 279-0279
 
   
Distributor
 
Davis Distributors, LLC
 
2949 East Elvira Road, Suite 101
 
Tucson, Arizona 85756
 
   
Transfer Agent
 
Boston Financial Data Services, Inc.
 
c/o The Davis Funds
 
P.O. Box 8406
 
Boston, Massachusetts 02266-8406
 
   
Overnight Address:
 
30 Dan Road
 
Canton, Massachusetts 02021-2809
 
   
Custodian
 
State Street Bank and Trust Co.
 
One Lincoln Street
 
Boston, Massachusetts 02111
 
   
Counsel
 
Greenberg Traurig, LLP
 
77 West Wacker Drive, Suite 3100
 
Chicago, Illinois 60601
 
   
Independent Registered Public Accounting Firm
 
KPMG LLP
 
1225 Seventeenth Street, Suite 800
 
Denver, Colorado 80202
 







For more information about Davis Global Fund and Davis International Fund, including management fee, charges, and expenses, see the current prospectus, which must precede or accompany this report.  The Funds’ Statement of Additional Information contains additional information about the Funds’ Directors and is available without charge, upon request, by calling 1-800-279-0279 and on the Funds’ website at www.davisfunds.com.  Quarterly Fact Sheets are available on the Funds’ website at www.davisfunds.com.




 
 
 
 
ITEM 2.  CODE OF ETHICS

The registrant has adopted a code of ethics that applies to the registrant’s principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions.

A copy of the code of ethics is filed as an exhibit to this form N-CSR.

ITEM 3.  AUDIT COMMITTEE FINANCIAL EXPERT

The registrant’s board of directors has determined that independent trustee Marsha Williams qualifies as the “audit committee financial expert”, as defined in Item 3 of form N-CSR.

ITEM 4.  PRINCIPAL ACCOUNTANT FEES AND SERVICES

(a)  
Audit Fees.  The aggregate Audit Fees billed by KPMP LLP (“KPMG”) for professional    services rendered for the audits of the audits of the financial statements, or services that are normally provided in connection with statutory and regulatory filings or engagements for the fiscal year ends October 31, 2012 and October 31, 2011 were $38,880 and $38,400 respectively.

(b)  
Audit-Related Fees.  The aggregate Audit-Related Fees billed by KPMG for services rendered for assurance and related services that are not reasonably related to the performance of the audit or review of the fund financial statements, but not reported as Audit Fees fore fiscal year ends October 31, 2012 and October 31, 2011 were $0 and $0, respectively.

(c)  
Tax Fees.  The aggregate Tax Fees billed by KPMG for professional services rendered for tax compliance, tax advice and tax planning for the fiscal year ends October 31, 2012 and October 31, 2011 were $15,070 and $14,630, respectively.

Fees included in the Tax Fee category comprise all services performed by professional staff in the independent accountant’s tax division except those services related to the audit.  These services include preparation of tax returns, tax advice related to mergers and a review of the fund income and capital gain distributions.

(d)  
All Other Fees.  The aggregate Other Fees billed by KPMG for all other non-audit services rendered to the fund for the fiscal year ends October 31, 2012 and October 31, 2011 were $0 and $0, respectively.

(e)(1)  Audit Committee Pre-Approval Policies and Procedures.

The fund Audit Committee must pre-approve all audit and non-audit services provided by the independent accountant relating to the operations or financial reporting of the funds.  Prior to the commencement of any audit or non-audit services to a fund, the Audit Committee reviews the services to determine whether they are appropriate and permissible under applicable law.

The fund Audit Committee has adopted a policy whereby audit and non-audit services performed by the fund independent accountant require pre-approval in advance at regularly scheduled Audit Committee meetings.  If such a service is required between regularly scheduled Audit Committee meetings, pre-approval may be authorized by the Audit Committee Chairperson with ratification at the next scheduled audit committee meeting.

(2)  
No services included in (b) – (d) above were approved pursuant to paragraph (c)(7)(i)(C) of
Rule 2-01 of Regulation S-X.

(f)   Not applicable

(g)  
The Funds’ independent accountant did not provide any services to the investment advisor or any affiliate for the fiscal years ended October 31, 2012 and October 31, 2011 . The fund has not paid any fees for non-audit not previously disclosed in items 4 (b) – (d).

(h)  
The registrant’s audit committee of the board of trustees has considered whether the provision of non-audit services that were rendered to the registrant’s investment adviser, and any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the registrant that not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with maintaining the principal accountant’s independence.  No such services were rendered.

ITEM 5.  AUDIT COMMITTEE OF LISTED REGISTRANTS

Not Applicable

ITEM 6.  SCHEDULE OF INVESTMENTS

Not Applicable.  The complete Schedule of Investments is included in Item 1 of this for N-CSR

ITEM 7.  DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES

Not Applicable

ITEM 8.  PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES

Not Applicable

ITEM 9.  PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANIES AND AFFILIATED PURCHASERS

Not Applicable

ITEM 10.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

There have been no changes to the procedure by which shareholders may recommend nominees to the registrant’s Board of Trustees.

ITEM 11.  CONTROLS AND PROCUDURES

(a)  
The registrant’s principal executive officer and principal financial officer have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-2 (c) under the Investment Company Act of 1940, as amended) are effective as of a date within 90 days of the filing date of this report.

(b)  
There have been no significant changes in the registrant’s internal controls or in other factors that could significantly affect these controls.

ITEM 12.  EXHIBITS

 
(a)(1)  The registrant’s code of ethics pursuant to Item 2 of Form N-CSR is filed as an exhibit to this form N-CSR.

 
(a)(2) Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 are attached.

 
(a)(3)  Not applicable

 
(b) Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 are attached.


 
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.

DAVIS NEW YORK VENTURE FUND, INC.

By           /s/ Kenneth C. Eich
Kenneth C. Eich
Principal Executive Officer

Date:  January 7, 2013

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/ Kenneth C. Eich
Kenneth C. Eich
Principal Executive Officer

Date:  January 7, 2013

By           /s/ Douglas A. Haines
Douglas A. Haines
Principal Financial Officer

Date: January 7, 2013


   
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