485BPOS 1 file1.htm

As filed with the Securities and Exchange Commission on August 29, 2006

Investment Company Act File No. 811-7840; Securities Act File No. 33-65632

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549

FORM N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [X]

POST-EFFECTIVE AMENDMENT No. 34 [X]

and/or
REGISTRATION STATEMENT UNDER INVESTMENT COMPANY ACT OF 1940 [X]

Amendment No. 36 [X]

SCHRODER SERIES TRUST
875 Third Avenue, 22nd Floor, New York, New York 10022
(212) 641-3800

Carin F. Muhlbaum, Esq.
Schroder Investment Management North America Inc.
875 Third Avenue, 22nd Floor,
New York, New York 10022

Copies to:

Timothy W. Diggins, Esq.
Ropes & Gray LLP
One International Place
Boston, Massachusetts 02110-2624

It is proposed that this filing will become effective (check appropriate box):

[_] Immediately upon filing pursuant [X] On August 30, 2006 pursuant to
to paragraph (b) paragraph (b)

[_] 60 days after filing pursuant [_] On (date) pursuant to
to paragraph (a)(1) paragraph (a)(1)

[_] 75 days after filing pursuant [_] On (date) pursuant to
to paragraph (a)(2) paragraph (a)(2) of Rule 485.

If appropriate, check the following box:

[_] This post-effective amendment designates a new effective date for a
previously filed post-effective amendment.

APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO PUBLIC As soon as
practicable after this registration statement becomes effective.

This post-effective amendment is being filed to include prospectuses and a
statement of additional information relating to the Schroder International
Diversified Value Fund (the "Fund"). Except as otherwise specifically indicated,
the amendment does not delete or supersede any prospectus or statement of
additional information in any prior post-effective amendment, except to the
extent it relates to the Fund.

[Schroders LOGO]

PROSPECTUS
DATED AUGUST 30, 2006

SCHRODER INTERNATIONAL DIVERSIFIED VALUE FUND

Investor Shares

This Prospectus describes one mutual fund offered by Schroder Series Trust (the
"Trust").

SCHRODER INTERNATIONAL DIVERSIFIED VALUE FUND seeks long-term capital
appreciation. The Fund seeks its objective by investing principally in a
portfolio of equity securities of companies located outside the United
States that the Fund's investment sub-adviser considers to offer attractive
valuations.

This Prospectus explains what you should know about the Fund before you invest.
Please read it carefully. You can call the Schroder Mutual Funds at (800)
464-3108 to find out more about the Fund and other funds in the Schroder family
of funds. From outside the United States, please call (617) 483-5000 and ask to
speak with a representative of the Schroder Mutual Funds.

NEITHER THE U.S. SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS ACCURATE OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

SCHRODER SERIES TRUST

TABLE OF CONTENTS

PAGE
----
SUMMARY INFORMATION...................................................... 1
SCHRODER INTERNATIONAL DIVERSIFIED VALUE FUND......................... 1
FEES AND EXPENSES........................................................ 5
PRINCIPAL RISKS OF INVESTING IN THE FUND................................. 6
NON-PRINCIPAL INVESTMENT STRATEGIES AND TECHNIQUES....................... 10
MANAGEMENT OF THE FUND................................................... 11
HOW THE FUND'S SHARES ARE PRICED......................................... 14
HOW TO BUY SHARES........................................................ 15
HOW TO SELL SHARES....................................................... 17
EXCHANGES................................................................ 19
DIVIDENDS AND DISTRIBUTIONS.............................................. 19
FREQUENT PURCHASES AND REDEMPTIONS OF FUND SHARES........................ 20
PAYMENT OF FEES.......................................................... 21
TAXES.................................................................... 21
DISCLOSURES OF FUND PORTFOLIO INFORMATION................................ 22
USA PATRIOT ACT.......................................................... 22

SUMMARY INFORMATION

This summary identifies the investment objectives, principal investment
strategies, and principal risks of Schroder International Diversified Value Fund
(the "Fund").

SCHRODER INTERNATIONAL DIVERSIFIED VALUE FUND

o INVESTMENT OBJECTIVE. Long-term capital appreciation.

o PRINCIPAL INVESTMENT STRATEGIES. The Fund invests principally in a
diversified portfolio of equity securities of companies located outside of
the United States that the Fund's sub-adviser considers to offer attractive
valuations. The Fund may invest in common and preferred stocks, securities
convertible into common and preferred stocks, and warrants to purchase
common and preferred stocks.

The Fund's sub-adviser applies a proprietary quantitative investment analysis
that seeks to develop a portfolio designed to capture the historically high
returns from value stocks but with lower risk than the Morgan Stanley Capital
International EAFE Index over the longer term and to provide a dividend yield
typically above that Index. The sub-adviser expects that a substantial portion
of the Fund's investments will normally be in countries included in the Morgan
Stanley Capital International EAFE Index, which is a market-weighted index of
companies representative of the market structure of certain developed market
countries in Europe, Australia, Asia, and the Far East, although the Fund may
invest in any country in the world, including "emerging markets" countries. (The
sub-adviser currently expects to invest not more than 25% of the Fund's assets
in securities of companies domiciled in emerging markets countries.)

The main elements of the sub-adviser's portfolio construction process are the
identification of attractive value stocks within a broad universe of companies
around the world and careful management of portfolio risks. The portfolio
construction process is bottom-up. The sub-adviser seeks to select stocks
anywhere in the world with high dividends and strong cash-flow. The sub-adviser
does not generally specify "top-down" geographic or sector allocations for the
Fund's portfolio; rather, the Fund's geographic and sector allocations are
principally the result of the sub-adviser's selection of individual companies
that it believes offer the greatest value. (The sub-adviser may adjust
geographic or sector weights resulting from this process in order to avoid
extreme outcomes.)

The sub-adviser does not consider benchmark weights when it constructs the
Fund's portfolio. Individual stock weights are determined using a disciplined
stock weighting process. The Fund's sub-adviser believes that indices weighted
by market capitalization reflect a natural bias towards expensive stocks and
geographic regions, and that, by contrast, a "bottom-up" approach to portfolio
construction, not constrained by reference to a specific benchmark or index, has
the potential to provide investment in less expensive stocks offering better
investment value.

The Fund will normally invest at least 65% of its net assets in equity
securities of companies located in countries outside of the United States. The
Fund will invest in a variety of countries throughout the world. The Fund may,
from time to time, invest more than 25% of its assets in any one country or
group of countries. The Fund's sub-adviser will consider an issuer to be located
in a country if it is organized under the laws of and its equity securities are
principally traded in that country, or it is domiciled or has its principal
place of business located in and its equity securities are principally traded in
that country, or if the Fund's sub-adviser determines that the issuer has more
than 50% of its assets in or derives more than 50% of its revenues from that
country. The Fund may invest in companies of any market capitalization,
including large, well known companies, as well as smaller, less closely followed
companies, including micro-cap companies.

The Fund may, but is not required to, enter into foreign currency exchange
transactions, for hedging purposes or to adjust the exposure of the Fund to
changes in the values of various foreign currencies.

The Fund generally sells securities when the Fund's sub-adviser believes they
are fully priced or when the sub-adviser considers more attractive investment
candidates are available.

The Fund may purchase or sell futures contracts and options and enter into total
return swaps, in order to gain exposure to particular securities or markets in
connection with hedging transactions or otherwise to increase total return. The
Fund may from time to time enter into other transactions involving derivatives,
including over-the-counter transactions, if the sub-adviser considers it
appropriate.

The Fund may also invest in closed-end investment companies, trusts,
exchange-traded mutual funds ("ETFs") (open-end investment companies whose
shares may be bought or sold by investors in transactions on major stock
exchanges), and real estate investment trusts ("REITs").

o PRINCIPAL RISKS.

o It is possible to lose money on an investment in the Fund.

o FOREIGN INVESTMENT RISK. Adverse political, regulatory, market, or
economic developments in foreign countries can affect issuers located
in those countries. Investments in foreign countries may also be
subject to foreign withholding taxes.

o FOREIGN CURRENCY RISK. Investments in foreign securities are normally
denominated and traded in foreign currencies. The value of the Fund's
assets may be affected favorably or unfavorably by currency exchange
rates, currency exchange control regulations, and restrictions or
prohibitions on the repatriation of foreign currencies.

o EMERGING MARKETS SECURITIES RISK. The Fund may invest in "emerging
market" countries whose securities markets may experience heightened
levels of volatility. The risks of investing in emerging markets
include greater political and economic uncertainties than in foreign
developed markets, currency transfer restrictions, a more limited
number of potential buyers, and an emerging market country's
dependence on revenue from particular commodities or international
aid. Additionally, the securities markets and legal systems in
emerging market countries may only be in a developmental stage and may
provide few, or none, of the advantages or protections of markets or
legal systems available in more developed countries. Emerging market
countries may experience extremely high levels of inflation, which may
adversely affect those countries' economies, currencies, and
securities markets. Also, emerging market issuers are often smaller
and less well-known than larger, more widely held companies, and
involve certain special risks associated with smaller capitalization
companies.

o EQUITY SECURITIES RISK. Equity securities are securities that
represent an ownership interest (or the right to acquire such an
interest) in a company and include common and preferred stocks. In the
event an issuer is liquidated or declares bankruptcy, the claims of
owners of bonds take priority over holders of preferred stock, whose
claims take priority over the claims of those who own common stock.

o CONVERTIBLE SECURITIES RISK. The Fund may invest in preferred stocks
that are convertible into common stocks, and so subject to the risks
of investments in both preferred and common stocks.

o WARRANTS RISK. The Fund may invest in warrants to purchase equity
securities. The price, performance and liquidity of such warrants are
typically linked to the underlying stock, less transaction costs. In
addition to the market risk related to the underlying holdings, the
Fund bears additional counterparty risk with respect to the issuing
broker. Moreover, there is currently no active trading market for
equity-linked warrants.

o EQUITY MARKETS RISK. A risk of investing in the Fund is the risk that
the value of the equity securities in the portfolio will fall, or will
not appreciate as anticipated by the Fund's sub-adviser, due

to factors that adversely affect markets generally or particular
companies in the portfolio. The values of equity securities fluctuate
in response to issuer, political, market, and economic developments.
Equity prices can fluctuate dramatically over short time periods in
response to these developments. Different parts of the market and
different types of equity securities can react differently to these
developments. For example, large capitalization stocks can react
differently from small capitalization stocks, and "growth" stocks can
react differently from "value" stocks. Issuer, political, or economic
developments can affect a single issuer, issuers within an industry or
economic sector or geographic region, or the market as a whole.

o DERIVATIVES RISK. Derivative transactions typically involve leverage
and may be highly volatile. It is possible that a derivative
transaction will result in a loss greater than the principal amount
invested, and the Fund may not be able to close-out a derivative
transaction at a favorable time or price.

o GEOGRAPHIC FOCUS RISK. To the extent that the Fund invests a
substantial amount of its assets in one country, its performance may
at times be worse than the performance of other mutual funds that
invest more broadly.

o SMALL AND MID CAP COMPANIES RISK. Small companies tend to be more
vulnerable to adverse developments than larger companies. The Fund may
invest in micro-cap companies, which tend to be particularly sensitive
to the risks associated with small companies. Small companies may have
limited product lines, markets, or financial resources, or may depend
on a limited management group. Their securities may trade less
frequently and in limited volumes. As a result, the prices of these
securities may fluctuate more than the prices of securities of larger,
more widely traded companies. Also, there may be less publicly
available information about small and mid cap companies or less market
interest in their securities as compared to larger companies, and it
may take longer for the price of the securities to reflect the full
value of their issuers' earnings potential or assets.

o INVESTMENTS IN POOLED VEHICLES RISK. The Fund may invest in shares of
closed-end investment companies (including single country funds),
trusts, and ETFs. Investing in another investment company or
pooled vehicle exposes the Fund to all the risks of that other
investment company or pooled vehicle, and, in general, subjects it to
a pro rata portion of the other investment company or pooled vehicle's
fees and expenses.

o REAL ESTATE INVESTMENT TRUST RISK. An investment in a REIT may be
subject to risks similar to those associated with direct ownership of
real estate, including losses from casualty or condemnation, and
changes in local and general economic conditions, supply and demand,
interest rates, zoning laws, regulatory limitations on rents, property
taxes and operating expenses. In addition, an investment in a REIT is
subject to additional risks, such as poor performance by the manager
of the REIT, adverse changes to the tax laws or failure by the REIT to
qualify for tax-free pass-through of income under the Internal Revenue
Code of 1986, as amended (the "Code"). In addition, some REITs have
limited diversification because they invest in a limited number of
properties, a narrow geographic area, or a single type of property.
Also, the organizational documents of a REIT may contain provisions
that make changes in control of the REIT difficult and time-consuming.
As a shareholder in a REIT a Fund, and indirectly the Fund's
shareholders, would bear its ratable share of the REIT's expenses and
would at the same time continue to pay its own fees and expenses.

o LIQUIDITY RISK. The Fund may find it difficult to sell or to close out
certain investments at favorable prices or times. Illiquid securities
may be highly volatile and difficult to value.

o MANAGEMENT RISK. Because the Fund is actively managed, its investment
return depends on the ability of its sub-adviser to manage its
portfolio successfully. The Fund's sub-adviser and the investment team
will apply investment techniques and risk analyses in making
investment decisions for the Fund, but there can be no guarantee that
these will produce the desired results.

Performance Information. The Fund recently commenced operations and does not yet
have historical investment performance. For performance information with respect
to other investment accounts managed by the Fund's adviser, see the Statement of
Additional Information ("SAI").

----------

Changes in investment objective and policies. Except for any policy described in
this prospectus or in the SAI as fundamental, the Fund's investment objectives
and policies may be changed by the Trustees without a vote of the shareholders.

FEES AND EXPENSES

THIS TABLE DESCRIBES THE FEES AND EXPENSES THAT YOU MAY PAY IF YOU BUY AND HOLD
INVESTOR SHARES OF THE FUND.

SHAREHOLDER FEES (paid directly from your investment):

MAXIMUM SALES LOAD IMPOSED ON PURCHASES None
MAXIMUM DEFERRED SALES LOAD None
MAXIMUM SALES LOAD IMPOSED ON REINVESTED DIVIDENDS None
REDEMPTION FEE 2.00%(1)
EXCHANGE FEE None

(1) Shares of the Fund held for two months or less are subject to a redemption
fee of 2.00%.

ANNUAL FUND OPERATING EXPENSES
(expenses that are deducted from Fund assets):

SCHRODER INTERNATIONAL
DIVERSIFIED VALUE FUND
----------------------
Management Fees (1) 1.00%
Distribution (12b-1) Fees None
Other Expenses (1)(2) 2.18%
Total Annual Fund Operating Expenses 3.18%
Less: Fee Waiver and Expense Limitation(3) (1.93)%
Net Expenses (3) 1.25%

(1) Management Fees for the Fund include all fees payable to the Fund's adviser
and its affiliates for investment advisory and fund administration services. The
Fund also pays sub-administrative fees directly to SEI Investments Global Fund
Services, and those fees are included under "Other Expenses."

(2) "Other Expenses" for the Fund are based on estimated amounts for the Fund's
current fiscal year.

(3) The "Net Expenses" shown for Schroder International Diversified Value Fund
reflect the effect of a contractually imposed fee waiver and/or expense
limitation, in effect until August 30, 2007 on the Total Annual Fund Operating
Expenses of the Fund. In order to limit the expenses of the Fund's Investor
Shares, the Fund's adviser has contractually agreed to reduce its compensation
(and, if necessary, to pay other Fund expenses) until August 30, 2007 to the
extent that the Total Annual Fund Operating Expenses of the Fund (other than
interest, taxes, and extraordinary expenses, which may include typically
non-recurring expenses such as, for example, organizational expenses, litigation
expenses, and shareholder meeting expenses) allocable to its Investor Shares
exceed the following annual rate (based on the average daily net assets
attributable to the Fund's Investor Shares): 1.25%. Net expenses of the Fund's
Investor Shares may be higher than 1.25% to the extent the Fund has such
interest, taxes, or extraordinary expenses. The Fund does not anticipate any
such expenses in its first fiscal year. The fee waiver and/or expense
limitations for the Fund may only be terminated during its term by the Board of
Trustees.

EXAMPLE

This Example is intended to help you compare the cost of investing in the Fund
with the cost of investing in other mutual funds.

The Example assumes that you invest $10,000 in Investor Shares of the Fund for
the time periods indicated and then redeem all of your Investor Shares at the
end of those periods. The Example also assumes that your investment earns a 5%
return each year and that the Fund's operating expenses for each year are the
same as the Fund's Total Annual Fund Operating Expenses shown above (except
that,

in the first year, the operating expenses are the same as the Fund's Net
Expenses shown above). Your actual costs may be higher or lower. Based on these
assumptions, your costs would be:

1 YEAR 3 YEARS
------ -------
SCHRODER INTERNATIONAL DIVERSIFIED VALUE FUND $127 $799

PRINCIPAL RISKS OF INVESTING IN THE FUND

The Fund may not achieve its objective. The following provides more detail about
certain of the Fund's principal risks and the circumstances which could
adversely affect the value of the Fund's shares or its investment return.

o FOREIGN INVESTMENT RISK. The Fund may invest in foreign securities.
Investments in foreign securities entail certain risks. There may be a
possibility of nationalization or expropriation of assets,
confiscatory taxation, political or financial instability, and
diplomatic developments that could affect the value of the Fund's
investments in certain foreign countries. In addition, there may be
less information publicly available about a foreign issuer than about
a U.S. issuer, and foreign issuers are not generally subject to
accounting, auditing, and financial reporting standards and practices
comparable to those in the United States. The securities of some
foreign issuers are less liquid and at times more volatile than
securities of comparable U.S. issuers. Foreign brokerage commissions
and other fees are also generally higher than in the United States.
Foreign settlement procedures and trade regulations may involve
certain risks (such as delay in payment or delivery of securities or
in the recovery of a Fund's assets held abroad) and expenses not
present in the settlement of domestic investments.

In addition, legal remedies available to investors in certain foreign
countries may be more limited than those available to investors in the
United States or in other foreign countries. The willingness and
ability of foreign governmental entities to pay principal and interest
on government securities depends on various economic factors,
including the issuer's balance of payments, overall debt level, and
cash-flow considerations related to the availability of tax or other
revenues to satisfy the issuer's obligations. If a foreign
governmental entity defaults on its obligations on the securities, the
Fund may have limited recourse available to it. The laws of some
foreign countries may limit a Fund's ability to invest in securities
of certain issuers located in those countries.

Special tax considerations apply to the Fund's investments in foreign
securities. In determining whether to invest the Fund's assets in debt
securities of foreign issuers, the Fund's sub-adviser considers the
likely impact of foreign taxes on the net yield available to the Fund
and its shareholders. Income and/or gains received by the Fund from
sources within foreign countries may be reduced by withholding and
other taxes imposed by such countries. Tax conventions between certain
countries and the United States may reduce or eliminate such taxes.
Any such taxes paid by the Fund will reduce its income available for
distribution to shareholders. In certain circumstances, the Fund may
be able to pass through to shareholders credits for foreign taxes
paid. Certain of these risks may also apply to some extent to
investments in U.S. companies that are traded in foreign markets, or
investments in U.S. companies that have significant foreign
operations.

In addition, a Fund's investments in foreign securities or foreign
currencies may increase or accelerate the Fund's recognition of
ordinary income and may affect the timing or character of the Fund's
distributions.

required to, buy or sell foreign securities and options and futures
contracts on foreign securities for hedging purposes in connection
with its foreign investments.

If the Fund purchases securities denominated in foreign currencies, a
change in the value of any such currency against the U.S. dollar will
result in a change in the U.S. dollar value of the Fund's assets and
the Fund's income available for distribution. Officials in foreign
countries may from time to time take actions in respect of their
currencies which could significantly affect the value of the Fund's
assets denominated in those currencies or the liquidity of such
investments. For example, a foreign government may unilaterally
devalue its currency against other currencies, which would typically
have the effect of reducing the U.S. dollar value of investments
denominated in that currency. A foreign government may also limit the
convertibility or repatriation of its currency or assets denominated
in its currency, which would adversely affect the U.S. dollar value
and liquidity of investments denominated in that currency. In
addition, although at times most of the Fund's income may be received
or realized in these currencies, the Fund will be required to compute
and distribute its income in U.S. dollars. As a result, if the
exchange rate for any such currency declines after the Fund's income
has been earned and translated into U.S. dollars but before payment to
shareholders, the Fund could be required to liquidate portfolio
securities to make such distributions. Similarly, if the Fund incurs
an expense in U.S. dollars and the exchange rate declines before the
expense is paid, the Fund would have to convert a greater amount of
U.S. dollars to pay for the expense at that time than it would have
had to convert at the time the Fund incurred the expense. The Fund
may, but is not required to, buy or sell foreign currencies and
options and futures contracts on foreign currencies for hedging
purposes in connection with its foreign investments.

o EMERGING MARKET SECURITIES RISK. Investing in emerging market
securities poses risks different from, and/or greater than, risks of
investing in domestic securities or in the securities of foreign,
developed countries. These risks include: smaller market
capitalization of securities markets, which may suffer periods of
relative illiquidity; significant price volatility; restrictions on
foreign investment; and possible repatriation of investment income and
capital. In addition, foreign investors may be required to register
the proceeds of sales, and future economic or political crises could
lead to price controls, forced mergers, expropriation or confiscatory
taxation, seizure, nationalization or the creation of government
monopolies. The currencies of emerging market countries may experience
significant declines against the U.S. dollar, and devaluation may
occur subsequent to investments in these currencies by the Fund.
Inflation and rapid fluctuations in inflation rates have had, and may
continue to have, negative effects on the economies and securities
markets of certain emerging market countries. Although many of the
emerging market securities in which the Fund may invest are traded on
securities exchanges, they may trade in limited volume, and the
exchanges may not provide all of the conveniences or protections
provided by securities exchanges in more developed markets.

Additional risks of emerging market securities may include: greater
social, economic and political uncertainty and instability; more
substantial governmental involvement in the economy; less governmental
supervision and regulation; unavailability of currency hedging
techniques; companies that are newly organized and small; differences
in auditing and financial reporting standards, which may result in
unavailability of material information about issuers; and less
developed legal systems. In addition, emerging securities markets may
have different clearance and settlement procedures, which may be
unable to keep pace with the volume of securities transactions or
otherwise make it difficult to engage in such transactions. Settlement
problems may cause the Fund to miss attractive investment
opportunities, hold a portion of its assets in cash pending
investment, or be delayed in disposing of a portfolio security. Such a
delay could result in possible liability to a purchaser of the
security.

and are subject to issuer and market risks that may cause their prices
to fluctuate over time. Preferred stocks represent an equity or
ownership interest in an issuer that typically pays dividends at a
specified rate and that has priority over common stock in the payment
of dividends and in liquidation. If interest rates rise, the fixed
dividend on preferred stocks may be less attractive, causing the price
of preferred stocks to decline. Different types of investments tend to
shift into and out of favor with investors depending on changes in
market and economic conditions.

o CONVERTIBLE SECURITIES RISK. The Fund may invest in preferred stocks
that are convertible into common stocks, and so subject to the risks
of investments in both preferred and common stocks. The market value
of convertible securities tends to decline as interest rates increase
and, conversely, tends to increase as interest rates decline. In
addition, because of the conversion feature, the market value of
convertible securities tends to vary with fluctuations in the market
value of the underlying common stocks and, therefore, also will react
to variations in the general market for equity securities.

o WARRANTS RISK. The Fund may invest in warrants to purchase equity
securities. The price, performance and liquidity of such warrants are
typically linked to the underlying stock.

o EQUITY MARKETS RISK. Although stocks may outperform other asset
classes over the long term, their prices tend to fluctuate more
dramatically over the shorter term. These movements may result from
factors affecting individual companies, or from broader influences
like changes in interest rates, market conditions, investor confidence
or announcements of economic, political or financial information.
While potentially offering greater opportunities for capital growth
than larger, more established companies, the stocks of smaller
companies may be particularly volatile, especially during periods of
economic uncertainty. These companies may face less certain growth
prospects, or depend heavily on a limited line of products and
services or the efforts of a small number of key management personnel.

o DERIVATIVES RISK. Derivatives are financial contracts whose value
depends on, or derives from, the value of an underlying asset,
reference rate, or index. The Fund's use of derivative instruments
involves risks different from, and possibly greater than, the risks
associated with investing directly in securities and other traditional
investments. Derivatives are subject to a number of risks described
elsewhere in this section, such as liquidity risk and credit risk, and
the risk that a derivative transaction may not have the effect the
Fund's sub-adviser anticipated. Derivatives also involve the risk of
mispricing or improper valuation and the risk that changes in the
value of the derivative may not correlate perfectly with the
underlying asset, rate, or index. Derivative transactions typically
involve leverage and may be highly volatile. Use of derivatives other
than for hedging purposes may be considered speculative, and when the
Fund invests in a derivative instrument it could lose more than the
principal amount invested. Also, suitable derivative transactions may
not be available in all circumstances and there can be no assurance
that the Fund will engage in these transactions to reduce exposure to
other risks when that would be beneficial. Many derivative
transactions are entered into "over the counter" (not on an exchange
or contract market); as a result, the value of such a derivative
transaction will depend on the ability and willingness of the Fund's
counterparty to perform its obligations under the transaction. The
Fund may be required to segregate certain of its assets on the books
of its custodian in respect of derivatives transactions entered into
by the Fund. See the Fund's SAI for more information.

involve certain special risks. They are more likely than larger
companies to have limited product lines, markets or financial
resources, or to depend on a small, inexperienced management group.
Securities of smaller companies may trade less frequently and in
lesser volume than more widely held securities and their values may
fluctuate more sharply than other securities. They may also trade in
the over-the-counter market or on a regional exchange, or may
otherwise have limited liquidity. These securities may therefore be
more vulnerable to adverse developments than securities of larger
companies, and the Fund may have difficulty establishing or closing
out its securities positions in smaller companies at prevailing market
prices. Also, there may be less publicly available information about
smaller companies or less market interest in their securities as
compared to larger companies, and it may take longer for the prices of
the securities to reflect the full value of their issuers' earnings
potential or assets.

o INVESTMENTS IN POOLED VEHICLES RISK. The Fund may invest in other
investment companies or pooled vehicles, including closed-end funds,
trusts, and ETFs, that are advised by the Fund's sub-adviser or
its affiliates or by unaffiliated parties, to the extent permitted by
applicable law. When investing in a closed-end investment company, the
Fund may pay a premium above such investment company's net asset value
per share and when the shares are sold, the price received by the Fund
may be at a discount to net asset value. As a shareholder in an
investment company or pooled vehicle, the Fund, and indirectly the
Fund's shareholders, would bear its ratable share of the investment
company's expenses, including advisory and administrative fees, and
would at the same time continue to pay its own fees and expenses. ETFs
issue redeemable securities, but because these securities may only be
redeemed in kind in significant amounts investors generally buy and
sell shares in transactions on securities exchanges.

o REAL ESTATE INVESTMENT TRUST RISK. An investment in a REIT may be
subject to risks similar to those associated with direct ownership of
real estate, including losses from casualty or condemnation, and
changes in local and general economic conditions, supply and demand,
interest rates, zoning laws, regulatory limitations on rents, property
taxes and operating expenses. In addition, an investment in a REIT is
subject to additional risks, such as poor performance by the manager
of the REIT, adverse changes to the tax laws or failure by the REIT to
qualify for tax-free pass-through of income under the Code. In
addition, some REITs have limited diversification because they invest
in a limited number of properties, a narrow geographic area, or a
single type of property. Also, the organizational documents of a REIT
may contain provisions that make changes in control of the REIT
difficult and time-consuming. As a shareholder in a REIT a Fund, and
indirectly the Fund's shareholders, would bear its ratable share of
the REIT's expenses and would at the same time continue to pay its own
fees and expenses.

o LIQUIDITY RISK. Liquidity risk exists when particular investments are
difficult to purchase or sell. The Fund's investments in illiquid
securities may reduce the returns of the Fund because it may be unable
to sell the illiquid securities at an advantageous time or price.
Investments in foreign securities, derivatives, or securities with
substantial market and/or credit risk tend to have the greatest
exposure to liquidity risk. Illiquid securities may be highly volatile
and difficult to value.

o MANAGEMENT RISK. Because the Fund is actively managed, the Fund's
investment return depends on the ability of its adviser or sub-adviser
to manage its portfolio successfully. The Fund's sub-adviser and its
investment team will apply investment techniques and risk analyses in
making investment decisions for the Fund, but there can be no
guarantee that these will produce the desired results.

NON-PRINCIPAL INVESTMENT STRATEGIES AND TECHNIQUES

In addition to the principal investment strategies described in the
Principal Investment Strategies section above, the Fund may at times, but is not
required to, use the strategies and techniques described below, which involve
certain special risks. This Prospectus does not attempt to disclose all of the
various investment techniques and types of securities that the Fund's
sub-adviser might use in managing the Fund. As in any mutual fund, investors
must rely on the professional investment judgment and skill of the Fund's
sub-adviser.

o DEPOSITARY RECEIPTS. The Fund may invest in American Depositary
Receipts, Global Depositary Receipts, European Depositary Receipts or
other similar securities representing ownership of foreign securities
(collectively, "Depositary Receipts"). Depositary Receipts generally
evidence an ownership interest in a corresponding foreign security on
deposit with a financial institution. Investments in non-U.S. issuers
through Depository Receipts and similar instruments may involve
certain risks not applicable to investing in U.S. issuers, including
changes in currency rates, application of local tax laws, changes in
governmental administration or economic or monetary policy or changed
circumstances in dealings between nations. Costs may be incurred in
connection with conversions between various currencies. The Fund may
invest in both sponsored and unsponsored Depositary Receipts.
Unsponsored Depositary Receipts are organized independently and
without the cooperation of the issuer of the underlying securities. As
a result, available information concerning the issuers may not be as
current for sponsored Depositary Receipts and the prices of
unsponsored Depositary Receipts may be more volatile than if such
instruments were sponsored by the issuer.

o SHORT SALES. The Fund may sell a security short when the Fund's
sub-adviser anticipates that the price of the security will decline.
The Fund may make a profit or incur a loss depending on whether the
market price of the security decreases or increases between the date
of the short sale and the date on which the Fund "closes" the short
position. A short position will result in a loss if the market price
of the security in question increases between the date when the Fund
enters into the short position and the date when the Fund closes the
short position. Such a loss could theoretically be unlimited in a case
where such Fund is unable, for whatever reason, to close out its short
position. In addition, short positions may result in a loss if a
portfolio strategy of which the short position is a part is otherwise
unsuccessful.

o SECURITIES LOANS AND REPURCHASE AGREEMENTS. The Fund may lend
portfolio securities to broker-dealers, and may enter into repurchase
agreements. These transactions must be fully collateralized at all
times, but involve some risk to the Fund if the other party should
default on its obligation and the Fund is delayed or prevented from
recovering the collateral. The Fund may enter into securities loans
and repurchase agreements as a non-principal investment strategy, as a
way to recognize additional current income on securities that it owns.

o TEMPORARY DEFENSIVE STRATEGIES. At times, the Fund's sub-adviser may
judge that conditions in the securities markets make pursuing the
Fund's investment strategy inconsistent with the best interests of its
shareholders. At such times, the Fund's sub-adviser may, but is not
required to, take temporary "defensive" positions that are
inconsistent with the Fund's principal investment strategies in
attempting to respond to adverse market, economic, political, or other
conditions. In implementing these defensive strategies, the Fund would
invest in investment grade fixed income securities, cash or money
market instruments to any extent the Fund's sub-adviser considers
consistent with such defensive strategies. It is impossible to predict
when, or for how long, the Fund would use these alternate strategies.
One risk of taking such temporary defensive positions is that the Fund
may not achieve its investment objective.

not receive the full market value for your Fund shares when you sell.
To the extent the Fund relies on pricing services to value some or all
of its portfolio securities, it is possible that the pricing
information provided by the service will not reflect the actual price
the Fund would receive upon a sale of the security.

o OTHER INVESTMENTS. The Fund may also invest in other types of
securities and utilize a variety of investment techniques and
strategies that are not described in this Prospectus. These securities
and techniques may subject the Fund to additional risks. Please see
the SAI for additional information about the securities and investment
techniques described in this Prospectus and about additional
techniques and strategies that may be used by the Fund.

o PERCENTAGE INVESTMENT LIMITATIONS. Unless otherwise noted, all
percentage limitations on Fund investments will apply at the time of
investment, including the requirement that the Fund normally invest at
least 65% of its net assets in equity securities of companies located
in countries outside of the United States. An investment by the Fund
would not be considered to violate these limitations unless an excess
or deficiency were to occur or exist immediately after and as a result
of an investment.

o PRIVATE PLACEMENTS AND RESTRICTED SECURITIES. The Fund may invest in
securities that are purchased in private placements. Because there may
be relatively few potential purchasers for such investments,
especially under adverse market or economic conditions or in the event
of adverse changes in the financial condition of the issuer, the Fund
could find it more difficult to sell such securities when the Fund's
sub-adviser believes it advisable to do so or may be able to sell such
securities only at prices lower than if such securities were more
widely held. At times, it may also be more difficult to determine the
fair value of such securities for purposes of computing the Fund's net
asset value. The Fund's sale of such investments may also be
restricted under securities laws. In the event that the Trustees, or
persons designated by the Trustees, determine that a security is
"readily marketable" pursuant to these procedures, and the Fund is not
able to sell such security at the price that such persons anticipate,
then the Fund's net asset value will decrease.

MANAGEMENT OF THE FUND

The Trust is governed by a Board of Trustees. The Board of Trustees of the Trust
has retained Schroder Investment Management North America Inc. ("Schroders") to
serve as the Fund's adviser and to manage the investments of the Fund. Subject
to the control of the Board of Trustees, Schroders also manages the Fund's other
affairs and business.

Schroder Investment Management North America Limited ("SIMNA Ltd."), an
affiliate of Schroders, serves as sub-adviser responsible for portfolio
management of Schroder International Diversified Value Fund.

Schroders (itself and its predecessors) has been an investment manager since
1962, and serves as investment adviser to the Fund and as investment adviser to
other mutual funds and a broad range of institutional investors. Schroders plc,
Schroders' ultimate parent, is a global asset management company with
approximately $223.2 billion under management as of March 31, 2006. Schroders
and its affiliates have clients that are major financial institutions including
banks and insurance companies, public and private pension funds, endowments and
foundations, high net worth individuals, financial intermediaries and retail
investors. Schroders plc has one of the largest networks of offices of any
dedicated asset management company and over 300 portfolio managers and analysts
covering the world's investment markets.

o MANAGEMENT FEES. The Fund expects to pay management fees for
investment management services to Schroders at the following annual
rate (based on the Fund's average daily net assets): 1.00%. As
compensation for SIMNA Ltd.'s services as sub-adviser, Schroders pays
to SIMNA

Ltd. fifty percent of the management fees Schroders receives from
Schroder International Diversified Value Fund.

o EXPENSE LIMITATIONS AND WAIVERS. In order to limit the expenses of
Schroder International Diversified Value Fund's Investor Shares,
Schroders has contractually agreed to reduce its compensation (and, if
necessary, to pay other Fund expenses) until August 30, 2007 to the
extent that the Total Annual Fund Operating Expenses of the Fund
(other than interest, taxes, and extraordinary expenses, which may
include typically non-recurring expenses such as, for example,
organizational expenses, litigation expenses, and shareholder meeting
expenses) allocable to its Investor Shares exceed the following annual
rate (based on the average daily net assets attributable to the Fund's
Investor Shares): 1.25%.

o PORTFOLIO MANAGEMENT. The following portfolio managers at Schroders
and SIMNA Ltd. have primary responsibility for making investment
decisions for the Fund. For Schroder International Diversified Value
Fund, all investment decisions are made by a team of investment
professionals at SIMNA Ltd. with the portfolio managers listed in the
table below for the Fund having primary responsibility for making
investment decisions for the Fund. Each portfolio manager's recent
professional experience is also shown. The Fund's SAI provides
additional information about each portfolio manager's compensation,
other accounts managed by the portfolio managers, and each portfolio
manager's ownership of securities in the Fund.

FUND NAME TITLE SINCE RECENT PROFESSIONAL EXPERIENCE
---------------------- ---------------- ----------------- ------------- --------------------------------

Schroder International Justin Lead Portfolio Inception Mr. Abercrombie is the Lead
Diversified Value Fund Abercrombie Manager and Head (August 2006) Portfolio Manager and Head of
of Quantitative QEP, SIMNA Ltd. He has been an
Equity Products employee of Schroders since
("QEP") 1996. Formerly, founding member
of QEP, SIMNA Ltd.

Schroder International John Marsland, Senior Portfolio Inception Mr. Marsland is a Senior Portfolio
Diversified Value Fund CFA Manager and (August 2006) Manager and Quantitative Analyst,
Quantitative SIMNA Ltd. He has been an employee
Analyst of SIMNA Ltd. since May 2006.
Formerly, Quantitative Fund Manager,
WMG Advisors LLP from January 2005
to April 2006, Head of Risk
Advisory, Commerzbank Securities
from 2000 to November 2004.

Schroder International David Philpotts Senior Inception Mr. Philpotts is Senior
Diversified Value Fund Quantitative (August 2006) Quantitative Analyst and
Analyst and Portfolio Manager, SIMNA Ltd. He
Portfolio Manager has been an employee of SIMNA
Ltd. since 1999. Formerly, Chief
Investment Officer, Quaestor
Investment Management from 2001
to March 2004, Deputy Head of QEP,
SIMNA Ltd. from 1999 to 2004.

Schroder International Stephen Langford Senior Inception Mr. Langford is Senior
Diversified Value Fund Quantitative (August 2006) Quantitative Analyst and
Analyst and Portfolio Manager, SIMNA Ltd. He
Portfolio Manager has been an employee of SIMNA
Ltd. since 2003. Formerly,
Senior Research Manager,
Quaestor Investment Management
from August 1999 to October
2003.

Schroder International Arnaud Amsellem Senior Inception Mr. Amsellem is Senior
Diversified Value Fund Quantitative (August 2006) Quantitative Analyst and
Analyst and Portfolio Manager, SIMNA Ltd. He
Portfolio Manager has been an employee of SIMNA
Ltd. since 2005. Formerly,
Senior Portfolio Manager, State
Street Hedge Fund Group,
Portfolio Manager, State Street
Active Team from June 2000 to
June 2005.

Schroder International Kristian Brock Quantitative Inception Mr. Brock is a Quantitative
Diversified Value Fund Analyst and (August 2006) Analyst and Portfolio Manager,
Portfolio Manager SIMNA Ltd. He has been an
employee of Schroders since
2001.

Schroder International James Larkman Quantitative Inception Mr. Larkman is a Quantitative
Analyst and (August 2006) Analyst and Portfolio

Diversified Value Fund Portfolio Manager Manager, SIMNA Ltd. He has been
an employee of Schroders since
2003 Prior to joining Schroders
he was a student attending the
Master's program at the
University of Reading from July
2003 to July 2004. Prior to July
2003, he attended the University
of Bath and participated in an
internship with Schroders.

HOW THE FUND'S SHARES ARE PRICED

The Fund calculates the net asset value of its Investor Shares by dividing the
total value of its assets attributable to its Investor Shares, less its
liabilities attributable to those shares, by the number of Investor Shares
outstanding. The Fund values its Investor Shares as of the close of trading on
the New York Stock Exchange (the "Exchange") (normally 4:00 p.m., Eastern Time)
each day the Exchange is open. The Trust expects that days, other than weekend
days, when the Exchange will not be open are New Year's Day, Martin Luther King,
Jr. Day, Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor
Day, Thanksgiving Day, and Christmas Day. Securities for which market quotations
are readily available are valued at prices which, in the opinion of Schroders,
most nearly represent the market values of such securities. Securities for which
market values are not readily available, or for which the Fund's adviser
believes the market value is unreliable (including, for example, certain foreign
securities, thinly traded securities, initial public offerings, or when there is
a particular event that may affect the value of a security), are valued by
Schroders at their fair values pursuant to guidelines established by the Board
of Trustees, and under the ultimate supervision of the Board of Trustees,
generally by reference to other securities or indexes. For instance, a pricing
service may recommend a fair value based generally on prices of comparable
securities. Unlisted securities for which market quotations are readily
available generally are valued at the most recently reported sale prices on any
day or, in the absence of a reported sale price, at mid-market prices. Options
and futures contracts traded on a securities exchange or board of trade
generally are valued at the last reported sales price or, in the absence of a
sale, at the closing mid-market price on the principal exchange where they are
traded. Options and futures not traded on a securities exchange or board of
trade for which over-the-counter market quotations are readily available shall
be valued at the most recently reported mid-market price. If such prices are not
available, unlisted securities and derivatives are valued by Schroders at their
fair values based on quotations from dealers, and if such quotations are not
available, based on factors in the market where such securities trade, such as
security and bond prices, interest rates, and currency exchange rates. The Fund
may invest in foreign securities that are primarily listed on foreign exchanges
that trade on weekends and other days when the Fund does not price its shares.
As a result, the value of the Fund's portfolio securities may change on days
when the price of the Fund's shares is not calculated. The price of the Fund's
shares will reflect any such changes when the price of the Fund's shares is next
calculated, which is the next day the Exchange is open. The Fund may use fair
value pricing more frequently for securities primarily traded in non-U.S.
markets because, among other things, most foreign markets close well before the
Fund values its securities. The earlier close of these foreign markets gives
rise to the possibility that significant events, including broad market moves,
may have occurred in the interim. The Fund's investments may be priced based on
fair values provided by a third party fair valuation vendor, based on certain
factors and methodologies applied by such vendor, in the event that there is
movement in the U.S. market that exceeds a specific threshold established by the
Schroders' Fair Value Committee in consultation with the Trustees. Short-term
investments that will mature within 60 days are valued by Schroders using
amortized cost pursuant to procedures adopted by the Board of Trustees. The net
asset value of the Fund's Investor Shares may differ from that of its Advisor
Shares due to differences in the expenses of Investor Shares and Advisor Shares.

HOW TO BUY SHARES

The Trust, through its distributor, Schroder Fund Advisors Inc., sells Investor
Shares of the Fund at their net asset value without any sales charges or loads,
so that the full amount of your purchase payment is invested in the Fund.

You may purchase Investor Shares of the Fund by completing the Account
Application that accompanies this Prospectus, and sending payment by check or
wire as described below. Acceptance of your order will be delayed pending
receipt of additional documentation, such as copies of corporate resolutions and
instruments of authority from corporations, administrators, executors, personal
representatives, directors, or custodians.

The Fund sells its Investor Shares at their net asset value next determined
after the Fund, its transfer agent, Boston Financial Data Services, Inc.
("BFDS"), or an authorized broker or financial institution (as described below)
receives your request in good order (meaning that the request meets the
requirements set out below and in the Account Application, and otherwise meets
the requirements implemented from time to time by the Fund's transfer agent or
the Fund). In order for you to receive the Fund's next determined net asset
value, the Fund, BFDS or the authorized broker or financial institution must
receive your order before the close of trading on the Exchange (normally 4:00
p.m., Eastern Time). The Trust reserves the right to reject any order to
purchase Investor Shares of any of its Funds. The Trust generally expects to
inform any persons that their purchase has been rejected within 24 hours.

The minimum investments for initial and additional purchases of Investor Shares
of the Fund are as follows:

INITIAL INVESTMENT ADDITIONAL INVESTMENTS
------------------ ----------------------
$250,000 $1,000

The Trust may, in its sole discretion, waive these minimum initial or subsequent
investment amounts for share purchases by: an employee of Schroders, any of its
affiliates or a financial intermediary authorized to sell shares of the Fund, or
such employee's spouse or life partner, or children or step-children age 21 or
younger; investment advisory clients of Schroders; and current or former
Trustees. For share purchases made through certain fund networks or other
financial intermediaries, the investment minimums associated with the policies
and programs of the fund network or financial intermediary will apply.

Investor Shares of the Fund are intended for purchase by investors making a
minimum initial investment of $250,000 and purchasing shares directly from the
Fund. Advisor Shares of the Fund are offered through another prospectus and are
intended for investors making a minimum initial investment of $2,500 through a
regular account or a traditional or Roth IRA and purchasing shares through a
financial intermediary.

The Fund does not issue share certificates.

The Trust may suspend the offering of Investor Shares of the Fund for any period
of time. The Trust may change any investment minimum from time to time.

Purchases by check. You may purchase Investor Shares of the Fund by mailing a
check (in U.S. dollars) payable to the Fund. If you wish to purchase Investor
Shares of two or more Funds, make your check payable to Schroder Mutual Funds
and include written instructions as to how the amount of your check should be
allocated among the Funds whose shares you are purchasing. Schroder Mutual Funds
will not accept third-party checks or starter checks. You should direct your
check and your completed Account Application as follows:

REGULAR MAIL OVERNIGHT OR EXPRESS MAIL
Schroder Mutual Funds Boston Financial Data Services, Inc.
P.O. Box 8507 Attn: Schroder Mutual Funds
Boston, MA 02266 30 Dan Road
Canton, MA 02021

For initial purchases, a completed Account Application must accompany your
check.

Purchases by bank wire. If you make your initial investment by wire, a completed
Account Application must precede your order. Upon receipt of the Application,
BFDS will assign you an account number. BFDS will process wire orders received
prior to the close of trading on the Exchange (normally 4:00 p.m., Eastern Time)
on each day the Exchange is open for trading at the net asset value next
determined as of the end of that day. BFDS will process wire orders received
after that time at the net asset value next determined thereafter.

Please call BFDS at (800) 464-3108 to give notice that you will send funds by
wire, and obtain a wire reference number. (From outside the United States,
please call (617) 483-5000 and ask to speak with a Schroder Mutual Funds
representative.) Please be sure to obtain a wire reference number. Instruct your
bank to wire funds with the assigned reference number as follows:

State Street Bank and Trust Company
225 Franklin Street
Boston, Massachusetts 02110
ABA No.: 011000028
Attn: Schroder Mutual Funds
DDA No.: 9904-650-0
FBO: Account Registration
A/C: Mutual Fund Account Number
Name of Fund

BFDS will not process your purchase until it receives the wired funds.

Automatic purchases. You can make regular investments of $100 or more per month
or quarter in Investor Shares of the Fund through automatic deductions from your
bank account. Please complete the appropriate section of the Account Application
if you would like to utilize this option. For more information, please call
(800) 464-3108.

Brokers and other financial institutions. You may also buy and exchange Investor
Shares of the Fund through an authorized broker or other financial institution
that has an agreement with Schroders or Schroder Fund Advisors Inc. The purchase
and exchange policies and fees charged by such brokers and other institutions
may be different than those of the Fund. For instance, banks, brokers,
retirement plans and financial advisers may charge transaction fees and may set
different investment minimums or limitations on buying or exchanging Investor
Shares. Please consult a representative of your financial institution for
further information.

Certain brokers or other financial institutions may accept purchase orders for
Investor Shares on behalf of the Fund. Such brokers or financial institutions
may designate other intermediaries to accept purchase orders on behalf of the
Fund. For purposes of pricing, the Fund will be deemed to have received a
purchase order when an authorized broker or financial institution or, if
applicable, a broker or financial institution's authorized designee, receives
the order. Agreements between such brokers or financial institutions and
Schroder Fund Advisors Inc., the Trust's distributor, provide that these orders
will be priced at the Fund's net asset value next determined after they are
received by the broker or financial institution or authorized designee. Orders
received in good order prior to the close of the Exchange on any day the
Exchange is open for trading will receive the net asset value next determined as
of the end of that day. Orders received after that time will receive the next
day's net asset value.

Brokers or other agents may charge investors a fee for effecting transactions in
shares of the Fund, in addition to any fees the Fund charges.

Purchases in kind. Investors may purchase Investor Shares of the Fund for cash
or in exchange for securities, subject to the determination by Schroders in its
discretion that the securities are acceptable. (For purposes of determining
whether securities will be acceptable, Schroders will consider, among other
things, whether they are liquid securities of a type consistent with the
investment objective and policies of the Fund and have a readily ascertainable
value.) If the Fund receives securities from an investor in exchange for
Investor Shares of the Fund, the Fund will under some circumstances have the
same tax basis in the securities as the investor had prior to the exchange (and
the Fund's gain for tax purposes would be calculated with regard to the
investor's tax basis), and in such cases the Fund's holding period in those
securities would include the investor's holding period. Any gain on the sale of
securities received in exchange for Investor Shares of the Fund would be subject
to distribution as capital gain to all of the Fund's shareholders. (In some
circumstances, receipt of securities from an investor in exchange for Investor
Shares of the Fund may be a taxable transaction to the investor, in which case
the Fund's tax basis in the securities would reflect the fair market value of
the securities on the date of the exchange, and its holding period in the
securities would begin on that date.) The Fund values securities accepted by
Schroders in the same manner as are the Fund's portfolio securities as of the
time of the next determination of the Fund's net asset value. Although the Fund
seeks to determine the fair value of securities contributed to the Fund, any
valuation that does not reflect fair value may dilute the interests of the
purchasing shareholder or the other shareholders of the Fund. All rights
reflected in the market price of accepted securities at the time of valuation
become the property of the Fund and must be delivered to the Fund upon receipt
by the investor. Investors may realize a taxable gain or loss upon the exchange.
Investors interested in purchases through exchange should telephone Schroders at
(800) 464-3108, their Schroders client representative, or other financial
intermediary.

Certain payments by Schroders or its affiliates. Schroder Fund Advisors Inc.,
Schroders, or their affiliates may, at their own expense and out of their own
assets, provide compensation to financial intermediaries in connection with
sales of Fund shares or shareholder servicing. In some instances, they may make
this compensation available only to certain intermediaries who have sold or are
expected to sell significant amounts of shares of the Fund. If you purchase or
sell shares through an intermediary, the intermediary may charge a separate fee
for its services. Consult your intermediary for information.

If correspondence to the shareholder's address of record is returned, then,
unless BFDS determines the shareholder's new address, BFDS will reinvest
dividends and other distributions returned to it in the Fund, and if the
correspondence included checks, the checks will be canceled and re-deposited to
the shareholder's account at then-current net asset value.

HOW TO SELL SHARES

When you may redeem. You may sell your Investor Shares back to the Fund on any
day the Exchange is open by sending a letter of instruction or stock power form
to Schroder Mutual Funds, or by calling BFDS at (800) 464-3108. Redemption
requests received in good order by Schroder Mutual Funds, BFDS, or an authorized
broker or financial institution (as described below) prior to the close of the
Exchange on any day the Exchange is open for trading will be priced at the net
asset value next determined as of the end of that day. Orders received after
that time will receive the next day's net asset value. A redemption request is
in good order if it includes the exact name in which the shares are registered,
the investor's account number, and the number of shares or the dollar amount of
shares to be redeemed, and, for written requests, if it is signed in accordance
with the account registration. A bank, broker-dealer, or certain other financial
institutions must guarantee the signature(s) of all account holders for any
redemption request in excess of $50,000, or for any amount being sent to an
address or bank account that is not registered on the account. The Stamp 2000
Medallion Guarantee is the only acceptable form of guarantee. An investor can
obtain this signature guarantee from a commercial bank, savings bank, credit
union, or broker-dealer that participates in one of the Medallion signature
guarantee programs. You may redeem your shares by telephone only if you elected
the telephone redemption privilege option

on your Account Application or otherwise in writing. Telephone redemption
proceeds will be sent only to you at an address on record with the Fund for at
least 30 days. Unless otherwise agreed, you may only exercise the telephone
redemption privilege to redeem shares worth not more than $50,000. The Trust may
require additional documentation from shareholders that are corporations,
partnerships, agents, fiduciaries, surviving joint owners, those acting through
powers of attorney, or similar delegation.

The Trust will pay you for your redemptions as promptly as possible and in any
event within seven days after the request for redemption is received in good
order. The Trust generally sends payment for shares on the business day after a
request is received. In case of emergencies, the Trust may suspend redemptions
or postpone payment for more than seven days, as permitted by law. If you paid
for your Investor Shares by check, the Trust will not send you your redemption
proceeds until the check you used to pay for the shares has cleared, which may
take up to 15 calendar days from the purchase date.

Brokers and other financial institutions. You may also redeem and exchange
Investor Shares of the Fund through an authorized broker or other financial
institution that has an agreement with Schroders or Schroder Fund Advisors Inc.
The redemption and exchange policies and fees charged by such brokers and other
institutions may be different than those of the Fund. For instance, banks,
brokers, retirement plans and financial advisers may charge transaction fees and
may set different investment minimums or limitations on exchanging or redeeming
Investor Shares. Please consult a representative of your financial institution
for further information.

Certain brokers or other financial institutions may accept redemption orders for
Investor Shares on behalf of the Fund. Such brokers or financial institutions
may designate other intermediaries to accept redemption orders on behalf of the
Fund. For purposes of pricing, the Fund will be deemed to have received a
redemption order when an authorized broker or financial institution or, if
applicable, a broker or financial institution's authorized designee, receives
the order. Agreements between such brokers or financial institutions and
Schroder Fund Advisors Inc., the Trust's distributor, provide that these orders
will be priced at the Fund's net asset value next determined after they are
received by the broker or financial institution or authorized designee. Orders
received in good order prior to the close of the Exchange on any day the
Exchange is open for trading will receive the net asset value next determined as
of the end of that day. Orders received after that time will receive the next
day's net asset value.

Brokers or other agents may charge investors a fee for effecting transactions in
shares of the Fund, in addition to any fees the Fund charges.

Involuntary redemptions. If, because of your redemptions, your account balance
for the Fund falls below a minimum amount set by the Trustees (presently
$2,000), a Trust may choose to redeem your Investor Shares in the Fund and pay
you for them. You will receive at least 30 days' written notice before the Trust
redeems your Investor Shares, and you may purchase additional Investor Shares at
any time to avoid a redemption. The Trust may also redeem Investor Shares if you
own shares of the Fund above a maximum amount set by the Trustees. There is
currently no maximum, but the Trustees may establish one at any time, which
could apply to both present and future shareholders.

Suspension. The Trust may suspend the right of redemption of the Fund or
postpone payment by the Fund during any period when: (1) trading on the Exchange
is restricted, as determined by the Securities and Exchange Commission ("SEC"),
or the Exchange is closed; (2) the SEC has by order permitted such suspension;
or (3) an emergency (as defined by rules of the SEC) exists, making disposal of
portfolio investments or determination of the Fund's net asset value not
reasonably practicable.

Redemptions in kind. The Trust does not expect to redeem Investor Shares in kind
under normal circumstances. If a Trust redeems your Investor Shares in kind, you
should expect to incur brokerage expenses and other transaction costs upon the
disposition of the securities you receive from the Fund. In addition, the price
of those securities may change between the time when you receive the securities
and the time when you are able to dispose of them. The Trust may pay redemption
proceeds in any amount with respect to the Fund in whole or in part by a
distribution in kind of liquid securities held by the Fund in lieu of cash.

General. If you request that your redemption proceeds be sent to you at an
address other than your address of record, or to another party, you must include
a signature guarantee for each signature, by an eligible signature guarantor,
such as a member firm of a national securities exchange or a commercial bank or
trust company located in the United States. If you are a resident of a foreign
country, another type of certification may be required. For more details, please
contact BFDS at (800) 464-3108, your Schroders client representative or your
financial intermediary. The Trust may require corporations, fiduciaries, and
other types of shareholders to supply additional documents which support their
authority to effect a redemption. In an effort to prevent unauthorized or
fraudulent redemption requests by telephone, BFDS will follow reasonable
procedures to confirm that telephone instructions are genuine. BFDS and the
Trust generally will not be liable for any losses due to unauthorized or
fraudulent purchase or redemption requests, but the applicable party or parties
may be liable if they do not follow these procedures.

Redemption fee. The Fund imposes a 2.00% redemption fee on shares redeemed
(including in connection with an exchange) two months or less from their date of
purchase. The fee is not a sales charge (load); it is paid directly to the Fund.
The purpose of the redemption fee is principally to discourage market timing,
and also to help defray costs incurred by the Fund in connection with short-term
trading by investors in its shares.

To the extent that the redemption fee applies, the price you will receive when
you redeem your shares of the Fund is the net asset value next determined after
receipt of your redemption request in good order, minus the redemption fee. The
redemption fee is not assessed on shares acquired through the reinvestment of
dividends or distributions paid by the Fund, or shares redeemed through
designated systematic withdrawal plans. The Fund reserves the right to make
other exceptions to the application of the redemption fee in the future provided
those exceptions are not inconsistent with the overall purpose of the redemption
fee policy. The redemption fee does apply to IRAs, and may also apply to shares
held in employer-sponsored retirement accounts (such as 401(k), 403(b), Keogh,
profit sharing, SIMPLE IRA, SEP-IRA and money purchase pension accounts) and
shares in retirement plans held in broker omnibus accounts.

For purposes of computing the redemption fee, redemptions by a shareholder to
which the fee applies will be deemed to have been made on a first-purchased,
first-redeemed basis.

EXCHANGES

You can exchange your Investor Shares of the Fund for Investor Shares of other
funds in the Schroder family of funds at any time at their respective net asset
values. An exchange of shares of the Fund may be subject to a redemption fee of
2.00% as described above under "Redemption Fee" (such that the exchange would be
made at net asset value minus any redemption fee). The Trust would treat the
exchange as a sale of your Investor Shares, and any gain on the exchange will
generally be subject to tax. For a listing of the Schroder funds available for
exchange and to exchange Investor Shares, please call (800) 464-3108. (From
outside the United States, please call (617) 483-5000 and ask to speak with a
representative of the Schroder Mutual Funds.) In order to exchange shares by
telephone, you must complete the appropriate section of the Account Application.
The Trust and Schroders reserve the right to change or suspend the exchange
privilege at any time. Schroders would notify shareholders of any such change or
suspension.

DIVIDENDS AND DISTRIBUTIONS

The Fund declares dividends from net investment income and distributes these
dividends annually. The Fund distributes any net realized capital gain at least
annually. The Fund makes distributions from net capital gain after applying any
available capital loss carryovers.

Shares begin to earn dividends on the first business day following the day of
purchase. Shares earn dividends through the date of redemption.

YOU CAN CHOOSE FROM FOUR DISTRIBUTION OPTIONS:

o Reinvest all distributions in additional Investor Shares of your Fund;

o Receive distributions from net investment income in cash while
reinvesting capital gains distributions in additional Investor Shares
of your Fund;

o Receive distributions from net investment income in additional
Investor Shares of your Fund while receiving capital gain
distributions in cash; or

o Receive all distributions in cash.

You can change your distribution option by notifying BFDS in writing. If you do
not select an option when you open your account, all distributions by the Fund
will be reinvested in Investor Shares of the Fund. You will receive a statement
confirming reinvestment of distributions in additional Fund shares promptly
following the period in which the reinvestment occurs.

FREQUENT PURCHASES AND REDEMPTIONS OF FUND SHARES

Excessive trading can hurt Fund performance, operations, and shareholders. The
Board of Trustees of the Fund has adopted policies and procedures with respect
to frequent purchases and redemptions of Fund shares by Fund shareholders. The
Fund discourages, and does not accommodate, frequent purchases and redemption of
the Fund's shares to the extent Schroders believes that such trading is harmful
to a Fund's shareholders, although the Fund will not necessarily prevent all
frequent trading in its shares. The Fund reserves the right, in its discretion,
to reject any purchase, in whole or in part (including, without limitation,
purchases by persons whose trading activity Schroders believes could be harmful
to the Fund). The Trust or Schroders may also limit the amount or number of
exchanges or reject any purchase by exchange if the Trust or Schroders believes
that the investor in question is engaged in "market timing activities" or
similar activities that may be harmful to the Fund or its shareholders, although
the Trust and Schroders have not established any maximum amount or number of
such exchanges that may occur in any period. The Trust generally expects to
inform any persons that their purchase has been rejected within 24 hours. In
addition, the Board of Trustees of the Fund has established a 2.00% redemption
fee for shares of the Fund held for two months or less from their date of
purchase. See "How to Sell Shares - Redemption Fee" for further information. The
ability of Schroders to monitor trades that are placed through omnibus or other
nominee accounts is limited in those instances in which the broker, retirement
plan administrator, or fee-based program sponsor does not provide complete
information to Schroders regarding underlying beneficial owners of Fund shares.
The Trust or its distributor may enter into written agreements with financial
intermediaries who hold omnibus accounts that require the intermediaries to
provide certain information to the Trust regarding shareholders who hold shares
through such accounts and to restrict or prohibit trading in Fund shares by
shareholders identified by the Trust as having engaged in trades that violate
the Trust's "market timing" policies. The Trust or Schroders may take any steps
they consider appropriate in respect of frequent trading in omnibus accounts,
including seeking additional information from the holder of the omnibus account
or potentially closing the omnibus account (although there can be no assurance
that the Trust or Schroders would do so). Please see the SAI for additional
information on frequent purchases and redemptions of Fund shares. There can be
no assurance that the Fund or Schroders will identify all harmful purchase or
redemption activity, or market timing or similar activities, affecting the Fund,
or that the Fund or Schroders will be successful in limiting or eliminating such
activities.

PAYMENT OF FEES

Subject to general review by the Board of Trustees, the Fund may pay Schroders
or its affiliates, banks, broker-dealers, financial advisors, or other financial
institutions fees for sub-administration, sub-transfer agency, and other
shareholder services associated with shareholders whose shares are held of
record in omnibus or other group accounts. In addition, the Fund's service
providers, including Schroders, or any of their affiliates, may, from time to
time, make these types of payment or payments for other shareholder services or
distribution, out of their own resources and without additional cost to the Fund
or its shareholders.

TAXES

TAXES ON DIVIDENDS AND DISTRIBUTIONS. For federal income tax purposes,
distributions of investment income are taxed as ordinary income. Taxes on
distributions of capital gains are determined by how long the Fund owned the
investments that generated the gains, rather than how long you have owned your
shares. Distributions of net capital gains from the sale of investments that the
Fund has held for more than one year and that are properly designated by the
Fund as capital gain dividends will be taxable as long-term capital gains.
Distributions of gains from the sale of investments that the Fund owned for one
year or less and gains on the sale of bonds characterized as a market discount
sale will be taxable as ordinary income. For taxable years beginning before
January 1, 2011, distributions of investment income designated by the Fund as
derived from "qualified dividend income" will be taxed in the hands of
individuals at rates applicable to long-term capital gains, provided holding
period and other requirements are met at both the shareholder and Fund level.

Distributions are taxable to shareholders even if they are paid from income or
gains earned by the Fund before a shareholder's investment (and thus were
included in the price the shareholder paid). Distributions are taxable whether
shareholders receive them in cash or reinvest them in additional shares.

Distributions by the Fund to retirement plans that qualify for tax-exempt
treatment under federal income tax laws will not be taxable. Special tax rules
apply to investments through such plans. You should consult your tax advisor to
determine the suitability of the Fund as an investment through such a plan and
the tax treatment of distributions (including distributions of amounts
attributable to an investment in a Fund) from such a plan.

The Fund's investment in certain debt obligations and derivative contracts may
cause the Fund to recognize taxable income in excess of the cash generated by
such obligations or contracts. Thus, the Fund could be required at times to
liquidate other investments in order to satisfy its distribution requirements.

In general, dividends (other than capital gain dividends) paid to a shareholder
that is not a "U.S. person" within the meaning of the Internal Revenue Code (a
"foreign person"), are subject to withholding of U.S. federal income tax at a
rate of 30% (or lower applicable treaty rate). However, under the American Jobs
Creation Act of 2004, effective for taxable years of the Fund beginning after
December 31, 2004 and before January 1, 2008, the Fund generally will not be
required to withhold any amounts with respect to distributions of (i) U.S.
source interest income that would not be subject to U.S. federal income tax if
earned directly by an individual foreign person, and (ii) net short-term capital
gains in excess of net long-term capital losses, in each case to the extent such
distributions are properly designated by the Fund.

Long-term capital gain rates applicable to individuals have been temporarily
reduced - in general, to 15% with lower rates applying to taxpayers in the 10%
and 15% rate brackets - for taxable years beginning before January 1, 2011.

TAXES WHEN YOU SELL, REDEEM OR EXCHANGE YOUR SHARES. Any gain resulting from a
redemption, sale or exchange (including an exchange for shares of another fund)
of your shares in the Fund will also

generally be subject to federal income tax at either short-term or long-term
capital gain rates depending on how long you have owned your shares.

FOREIGN TAXES. The Fund's investments in foreign securities may be subject to
foreign withholding or other taxes. In that case, the Fund's return on those
securities would be decreased. Shareholders of Schroders Funds that invest more
than 50% of their assets in foreign securities may be entitled to claim a credit
or deduction with respect to foreign taxes. Shareholders of other Schroders
funds generally will not be entitled to claim a credit or deduction with respect
to foreign taxes. In addition, investments in foreign securities may increase or
accelerate the Fund's recognition of ordinary income and may affect the timing
or amount of the Fund's distributions.

DERIVATIVES. The Fund's use of derivatives may affect the amount, timing, and
character of distributions to shareholders and, therefore, may increase the
amount of taxes payable by shareholders.

CONSULT YOUR TAX ADVISOR ABOUT OTHER POSSIBLE TAX CONSEQUENCES. This is a
summary of certain U.S. federal income tax consequences of investing in the
Fund. You should consult your tax advisor for more information on your own tax
situation, including possible other federal, state, local and foreign tax
consequences of investing in the Fund.

DISCLOSURES OF FUND PORTFOLIO INFORMATION

Please see the Fund's SAI for a description of the Fund's policies and
procedures regarding the persons to whom the Fund or Schroders may disclose the
Fund's portfolio securities positions, and under which circumstances.

USA PATRIOT ACT

To help the government fight the funding of terrorism and money laundering
activities, federal law requires all financial institutions to obtain, verify,
and record information that identifies each person who opens an account. What
this means to you: When you open an account directly with the Fund, you will be
asked your name, address, date of birth, and other information that will allow
you to be identified. You may also be asked for other identifying documentation.
If the Trust is unable to verify the information shortly after your account is
opened, your account may be closed and your shares redeemed at their net asset
values at the time of the redemption.

INVESTMENT MANAGER
Schroder Investment Management North America Inc.
875 Third Avenue
New York, New York 10022

INVESTMENT SUB-ADVISER
Schroder Investment Management North America Limited
31 Gresham Street
London EC2V 7QA

ADMINISTRATOR
SEI Investments Global Funds Services
1 Freedom Valley Drive
Oaks, Pennsylvania 19456

CUSTODIAN
J.P. Morgan Chase Bank
270 Park Avenue
New York, New York 10017

DISTRIBUTOR
Schroder Fund Advisors Inc.
875 Third Avenue
New York, New York 10022

TRANSFER AND DIVIDEND DISBURSING AGENT
Boston Financial Data Services, Inc.
Two Heritage Drive
North Quincy, Massachusetts 02171

COUNSEL
Ropes & Gray LLP
One International Place
Boston, Massachusetts 02110

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
PricewaterhouseCoopers LLP
Two Commerce Square
Suite 1700
2001 Market Street
Philadelphia, Pennsylvania 19103

SCHRODER SERIES TRUST
Schroder International Diversified Value Fund

The Fund has an SAI which includes additional information about the Fund. The
SAI is incorporated by reference into this Prospectus, which means it is part of
this Prospectus for legal purposes. You may get free copies of the SAI, request
other information about the Fund, or make shareholder inquiries by calling (800)
464-3108. From outside the United States, please call (617) 483-5000 and ask to
speak with a representative of the Schroder Mutual Funds. The Fund's SAI is also
available on the following website: www.schroderfunds.com.

You may review and copy information about the Fund, including its SAI, at the
Securities and Exchange Commission's public reference room in Washington, D.C.
You may call the SEC at 1-800-SEC-0330 for information about the operation of
the public reference room. You may also access reports and other information
about the Fund on the SEC Internet site at www.sec.gov. You may get copies of
this information, with payment of a duplication fee, by electronic request to
the following e-mail address: publicinfo@sec.gov or by writing the Public
Reference Section of the Commission, Washington, D.C. 20549-0102. You may need
to refer to the Trust's file number under the Investment Company Act, which is:
Schroder Series Trust: 811-7840.

SCHRODER SERIES TRUST
875 Third Avenue
New York, New York 10022
(800) 464-3108

File No. 811-7840 - Schroder Series Trust

[Schroders LOGO]

PROSPECTUS
DATED AUGUST 30, 2006

SCHRODER INTERNATIONAL DIVERSIFIED VALUE FUND

Advisor Shares

This Prospectus describes one mutual fund offered by Schroder Series Trust (the
"Trust").

SCHRODER SERIES TRUST

TABLE OF CONTENTS

PAGE
----
SUMMARY INFORMATION ..................................................... 1
SCHRODER INTERNATIONAL DIVERSIFIED VALUE FUND ........................ 1
FEES AND EXPENSES ....................................................... 5
PRINCIPAL RISKS OF INVESTING IN THE FUND ................................ 6
NON-PRINCIPAL INVESTMENT STRATEGIES AND TECHNIQUES ...................... 10
MANAGEMENT OF THE FUND .................................................. 11
HOW THE FUND'S SHARES ARE PRICED ........................................ 14
HOW TO BUY SHARES ....................................................... 15
HOW TO SELL SHARES ...................................................... 17
EXCHANGES ............................................................... 19
ADDITIONAL INFORMATION ABOUT ADVISOR SHARES; DISTRIBUTION PLAN .......... 20
DIVIDENDS AND DISTRIBUTIONS ............................................. 20
FREQUENT PURCHASES AND REDEMPTIONS OF FUND SHARES ....................... 21
PAYMENT OF FEES ......................................................... 21
TAXES ................................................................... 21
DISCLOSURES OF FUND PORTFOLIO INFORMATION ............................... 23
USA PATRIOT ACT ......................................................... 23

SUMMARY INFORMATION

This summary identifies the investment objectives, principal investment
strategies, and principal risks of Schroder International Diversified Value Fund
(the "Fund").

SCHRODER INTERNATIONAL DIVERSIFIED VALUE FUND

o INVESTMENT OBJECTIVE. Long-term capital appreciation.

The Fund may, but is not required to, enter into foreign currency exchange
transactions for hedging purposes to adjust the exposure of the Fund to changes
in the values of foreign currencies.

The Fund generally sells securities when the Fund's sub-adviser believes they
are fully priced or when the sub-adviser considers more attractive investment
candidates are available.

o PRINCIPAL RISKS.

o It is possible to lose money on an investment in the Fund.

o CONVERTIBLE SECURITIES RISK. The Fund may invest in preferred stocks
that are convertible into common stocks, and so subject to the risks
of investments in both preferred and common stocks.

o INVESTMENTS IN POOLED VEHICLES RISK. The Fund may invest in shares of
closed-end investment companies (including single country funds),
trusts, and ETFs. Investing in another investment company or
pooled investment vehicle exposes the Fund to all the risks of that
other investment company or pooled vehicle, and, in general, subjects
it to a pro rata portion of the other investment company or pooled
vehicle's fees and expenses.

o LIQUIDITY RISK. The Fund may find it difficult to sell or to close out
certain investments at favorable prices or times. Illiquid securities
may be highly volatile and difficult to value.

----------

FEES AND EXPENSES

THIS TABLE DESCRIBES THE FEES AND EXPENSES THAT YOU MAY PAY IF YOU BUY AND HOLD
ADVISOR SHARES OF THE FUND.

SHAREHOLDER FEES (paid directly from your investment):

MAXIMUM SALES LOAD IMPOSED ON PURCHASES None
MAXIMUM DEFERRED SALES LOAD None
MAXIMUM SALES LOAD IMPOSED ON REINVESTED DIVIDENDS None
REDEMPTION FEE 2.00%(1)
EXCHANGE FEE None

(1) Shares of the Fund held for two months or less are subject to a redemption
fee of 2.00%.

ANNUAL FUND OPERATING EXPENSES
(expenses that are deducted from Fund assets):

SCHRODER INTERNATIONAL DIVERSIFIED VALUE FUND
---------------------------------------------
Management Fees (1) 1.00%
Distribution 0.25%
(12b-1) Fees
Other Expenses (1)(2) 2.18%
Total Annual Fund Operating 3.43%
Expenses
Less: Fee Waiver and Expense (1.93)%
Limitation(3)
Net Expenses (3) 1.50%

(1) Management Fees for the Fund include all fees payable to the Fund's adviser
and its affiliates for investment advisory and fund administration
services. The Fund also pays sub-administrative fees directly to SEI
Investments Global Fund Services, and those fees are included under "Other
Expenses."

(2) "Other Expenses" for the Fund are based on estimated amounts for the Fund's
current fiscal year.

(3) The "Net Expenses" shown for Schroder International Diversified Value Fund
reflect the effect of a contractually imposed fee waiver and/or expense
limitation, in effect until August 30, 2007 on the Total Annual Fund
Operating Expenses of the Fund. In order to limit the expenses of the
Fund's Advisor Shares, the Fund's adviser has contractually agreed to
reduce its compensation (and, if necessary, to pay other Fund expenses)
until August 30, 2007 to the extent that the Total Annual Fund Operating
Expenses of the Fund (other than interest, taxes, and extraordinary
expenses, which may include typically non-recurring expenses such as, for
example, organizational expenses, litigation expenses, and shareholder
meeting expenses) allocable to its Advisor Shares exceed the following
annual rate (based on the average daily net assets attributable to the
Fund's Advisor Shares): 1.50%. Net expenses of the Fund's Advisor Shares
may be higher than 1.50% to the extent the Fund has such interest, taxes,
and extraordinary expenses. The Fund does not anticipate any such expenses
in its first fiscal year. The fee waiver and/or expense limitations for the
Fund may only be terminated during its term by the Board of Trustees.

EXAMPLE

This Example is intended to help you compare the cost of investing in the Fund
with the cost of investing in other mutual funds.

The Example assumes that you invest $10,000 in Advisor Shares of the Fund for
the time periods indicated and then redeem all of your Advisor Shares at the end
of those periods. The Example also assumes that your investment earns a 5%
return each year and that the Fund's operating expenses for each year are the
same as the Fund's Total Annual Fund Operating Expenses shown above (except
that,

in the first year, the operating expenses are the same as the Fund's Net
Expenses shown above). Your actual costs may be higher or lower. Based on these
assumptions, your costs would be:

1 YEAR 3 YEARS
------ -------
SCHRODER INTERNATIONAL DIVERSIFIED
VALUE FUND $153 $874

Because of Rule 12b-1 fees paid by the Fund, long-term shareholders may pay more
than the economic equivalent of the maximum front-end sales load permitted under
the applicable broker-dealer sales rules.

PRINCIPAL RISKS OF INVESTING IN THE FUND

o FOREIGN CURRENCIES RISK. Since foreign securities normally are
denominated and traded in foreign currencies, the value of the Fund's
assets may be affected favorably or unfavorably by currency exchange
rates, currency exchange control regulations, foreign withholding
taxes, and restrictions or prohibitions on the repatriation of foreign
currencies. The Fund may, but is not required to, buy or sell foreign
securities and options and futures contracts on foreign securities for
hedging purposes in connection with its foreign investments.

o EQUITY SECURITIES RISK. The principal risks of investing in the Fund
include the risk that the value of the equity securities in the
portfolio will fall, or will not appreciate as anticipated by the
Fund's sub-adviser, due to factors that adversely affect equities
markets generally or particular companies in the portfolio. Common
stocks represent an equity or ownership interest in an issuer and are
subject to issuer and market risks that may cause their prices to
fluctuate over time. Preferred stocks represent an equity or ownership
interest in an issuer that typically pays dividends at a specified
rate and that has priority over common stock in the payment of
dividends and in liquidation. If interest rates rise, the fixed
dividend on preferred stocks may be less attractive, causing the price
of preferred stocks to decline. Different types of investments tend to
shift into and out of favor with investors depending on changes in
market and economic conditions.

o WARRANTS RISK. The Fund may invest in warrants to purchase equity
securities. The price, performance and liquidity of such warrants are
typically linked to the underlying stock.

o DERIVATIVES RISK. Derivatives are financial contracts whose value
depends on, or derives from, the value of an underlying asset,
reference rate, or index. The Fund's use of derivative instruments
involves risks different from, and possibly greater than, the risks
associated with investing directly in securities and other traditional
investments. Derivatives are subject to a number of risks described
elsewhere in this section, such as liquidity risk, and credit risk,
and the risk that a derivative transaction may not have the effect the
Fund's sub-adviser anticipated. Derivatives also involve the risk of
mispricing or improper valuation and the risk that changes in the
value of the derivative may not correlate perfectly with the
underlying asset, rate, or index. Derivative transactions typically
involve leverage and may be highly volatile. Use of derivatives other
than for hedging purposes may be considered speculative, and when the
Fund invests in a derivative instrument it could lose more than the
principal amount invested. Also, suitable derivative transactions may
not be available in all circumstances and there can be no assurance
that the Fund will engage in these transactions to reduce exposure to
other risks when that would be beneficial. Many derivative
transactions are entered into "over the counter" (not on an exchange
or contract market); as a result, the value of such a derivative
transaction will depend on the ability and willingness of the Fund's
counterparty to perform its obligations under the transaction. The
Fund may be required to segregate certain of its assets on the books
of its custodian in respect of derivatives transactions entered into
by the Fund. See the Fund's SAI for more information.

o SMALL AND MID CAP COMPANIES RISK. The Fund may invest in companies
that are smaller and less well-known than larger, more widely held
companies. Micro, small and mid cap companies may offer greater
opportunities for capital appreciation than larger companies, but may
also involve certain special risks. They are more likely than larger
companies to have limited product lines, markets or financial
resources, or to depend on a small, inexperienced management group.
Securities of smaller companies may trade less frequently and in
lesser volume than more widely held securities and their values may
fluctuate more sharply than other securities. They may also trade in
the over-the-counter market or on a regional exchange, or may
otherwise have limited liquidity. These securities may therefore be
more vulnerable to adverse developments than securities of larger
companies, and the Fund may have difficulty establishing or closing
out its securities positions in smaller companies at prevailing market
prices. Also, there may be less publicly available information about
smaller companies or less market interest in their securities as
compared to larger companies, and it may take longer for the prices of
the securities to reflect the full value of their issuers' earnings
potential or assets.

o REAL ESTATE INVESTMENT TRUST RISK. An investment in a REIT may be
subject to risks similar to those associated with direct ownership of
real estate, including losses from casualty or condemnation, and
changes in local and general economic conditions, supply and demand,
interest rates, zoning laws, regulatory limitations on rents, property
taxes and operating expenses. In addition, an investment in a REIT is
subject to additional risks, such as poor performance by the manager
of the REIT, adverse changes to the tax laws or failure by the REIT to
qualify for tax-free pass-through of income under the Code. In
addition, some REITs have limited diversification because they invest
in a limited number of properties, a narrow geographic area, or a
single type of property. Also, the organizational documents of a REIT
may contain provisions that make changes in control of the REIT
difficult and time-consuming. As a shareholder in a REIT a Fund, and
indirectly the Fund's shareholders, would bear its ratable share of
the REIT's expenses and would at the same time continue to pay its own
fees and expenses.

o MANAGEMENT RISK. Because the Fund is actively managed, the Fund's
investment return depends on the ability of its adviser or sub-adviser
to manage its portfolio successfully. The

Fund's sub-adviser and its investment team will apply investment
techniques and risk analyses in making investment decisions for the
Fund, but there can be no guarantee that these will produce the
desired results.

NON-PRINCIPAL INVESTMENT STRATEGIES AND TECHNIQUES

o PRICING. At times market conditions might make it hard to value some
investments. If the Fund has valued securities it holds too high, you
may end up paying too much for the Fund's shares when you buy into a
Fund. If the Fund underestimates the price of its portfolio
securities, you may not receive the full market value for your Fund
shares when you sell. To the extent the Fund relies on pricing
services to value some or all of its portfolio securities, it is
possible that the pricing information provided by the service will not
reflect the actual price the Fund would receive upon a sale of the
security.

MANAGEMENT OF THE FUND

o EXPENSE LIMITATIONS AND WAIVERS. In order to limit the expenses of
Schroder International Diversified Value Fund's Advisor Shares,
Schroders has contractually agreed to reduce its compensation (and, if
necessary, to pay other Fund expenses) until August 30, 2007 to the
extent that the Total Annual Fund Operating Expenses of the Fund
(other than interest, taxes, and extraordinary expenses, which may
include typically non-recurring expenses such as, for example,
organizational expenses, litigation expenses, and shareholder meeting
expenses) allocable to its Advisor Shares exceed the following annual
rate (based on the average daily net assets attributable to the Fund's
Advisor Shares): 1.50%.

RECENT
PROFESSIONAL
FUND NAME TITLE SINCE EXPERIENCE
----------------- ----------- -------------- --------- -----------------
Schroder Justin Lead Portfolio Inception Mr. Abercrombie
International Abercrombie Manager and (August is the Lead
Diversified Value Head of 2006) Portfolio Manager
Fund Quantitative and Head of QEP,
Equity SIMNA Ltd. He has
Products been an employee
("QEP") of Schroders
since 1996.
Formerly,
founding member
of QEP, SIMNA
Ltd.
Schroder John Senior Inception Mr. Marsland is a
International Marsland, Portfolio (August Senior Portfolio
Diversified Value CFA and 2006) Manager and
Fund Quantitative Quantitative
Analyst Analyst, SIMNA
Ltd. He has been
an employee of
SIMNA Ltd. since
May 2006.
Formerly,
Quantitative Fund
Manager, WMG
Advisors LLP
from January 2005
to April 2006,
Head of Risk
Advisory,
Commerzbank
Securities
from 2000 to
November 2004.
Schroder David Senior Inception Mr. Philpotts is
International Philpotts Quantitative (August Senior
Diversified Value Analyst and 2006) Quantitative
Fund Portfolio Analyst and
Manager Portfolio
Manager,
SIMNA Ltd. He has
been an employee
of SIMNA Ltd.
since 1999.
Formerly, Chief
Investment
Officer, Quaestor
Investment
Management
from 2001 to
March 2004,
Deputy Head of
QEP, SIMNA Ltd.
from 1999 to 2004.
Schroder Stephen Senior Inception Mr. Langford is
International Langford Quantitative (August Senior
Diversified Value Analyst and 2006) Quantitative
Fund Portfolio Analyst and
Manager Portfolio
Manager, SIMNA
Ltd. He has been
an employee of
SIMNA Ltd. since
2003. Formerly,
Senior Research
Manager, Quaestor
Investment
Management from
August 1999 to
October 2003.
Schroder Arnaud Senior Inception Mr. Amsellem is
International Amsellem Quantitative (August Senior
Diversified Value Analyst and 2006) Quantitative
Fund Portfolio Analyst and
Manager Portfolio
Manager, SIMNA
Ltd. He has been
an employee of
SIMNA Ltd. since
2005. Formerly,
Senior Portfolio
Manager, State
Street Hedge Fund
Group, Portfolio
Manager, State
Street Active
Team from June
2000 to June
2005.
Schroder Kristian Quantitative Inception Mr. Brock is a
International Brock Analyst and (August Quantitative
Diversified Value Portfolio 2006) Analyst and
Fund Manager Portfolio
Manager, SIMNA
Ltd. He has been
an employee of
Schroders since
2001.
Schroder James Quantitative Inception Mr. Larkman is a
International Larkman Analyst and (August Quantitative
2006) Analyst and
Portfolio

Diversified Value Portfolio Manager, SIMNA
Fund Manager Ltd. He has been
an employee of
Schroders since
2004. Prior to
joining Schroders
he was a student
attending a
Master's program
at the University
of Reading from
July 2003 to July
2004. Prior to
July 2003, he
attended the
University of
Bath and
participated in
an internship
with Schroders.

HOW THE FUND'S SHARES ARE PRICED

The Fund calculates the net asset value of its Advisor Shares by dividing the
total value of its assets attributable to its Advisor Shares, less its
liabilities attributable to those shares, by the number of Advisor Shares
outstanding. The Fund values its Advisor Shares as of the close of trading on
the New York Stock Exchange (the "Exchange") (normally 4:00 p.m., Eastern Time)
each day the Exchange is open. The Trust expects that days, other than weekend
days, when the Exchange will not be open are New Year's Day, Martin Luther King,
Jr. Day, Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor
Day, Thanksgiving Day, and Christmas Day. Securities for which market quotations
are readily available are valued at prices which, in the opinion of Schroders,
most nearly represent the market values of such securities. Securities for which
market values are not readily available, or for which the Fund's adviser
believes the market value is unreliable (including, for example, certain foreign
securities, thinly traded securities, initial public offerings, or when there is
a particular event that may affect the value of a security), are valued by
Schroders at their fair values pursuant to guidelines established by the Board
of Trustees, and under the ultimate supervision of the Board of Trustees,
generally by reference to other securities or indexes. For instance, a pricing
service may recommend a fair value based generally on prices of comparable
securities. Unlisted securities for which market quotations are readily
available generally are valued at the most recently reported sale price on any
day or in the absence of a reported sale price, at mid-market prices. Options
and futures contracts traded on a securities exchange or board of trade
generally are valued at the last reported sales price or, in the absence of
sale, at the closing mid-market price on the principal exchange where they are
traded. Options and futures not traded on a securities exchange or board of
trade for which over-the-counter market quotations are readily available shall
be valued at the most recently reported mid-market price. If such prices are not
available, unlisted securities and derivatives are valued by Schroders at their
fair values based on quotations from dealers, and if such quotations are not
available, based on factors in the market where such securities trade, such as
security and bond prices, interest rates, and currency exchange rates. The Fund
may invest in foreign securities that are primarily listed on foreign exchanges
that trade on weekends and other days when the Fund does not price its shares.
As a result, the value of the Fund's portfolio securities may change on days
when the price of the Fund's shares is not calculated. The price of the Fund's
shares will reflect any such changes when the price of the Fund's shares is next
calculated, which is the next day the Exchange is open. The Fund may use fair
value pricing more frequently for securities primarily traded in non-U.S.
markets because, among other things, most foreign markets close well before the
Fund values its securities. The earlier close of these foreign markets gives
rise to the possibility that significant events, including broad market moves,
may have occurred in the interim. The Fund's investments may be priced based on
fair values provided by a third party fair valuation vendor, based on certain
factors and methodologies applied by such vendor, in the event that there is
movement in the U.S. market that exceeds a specific threshold established by the
Schroders' Fair Value Committee in consultation with the Trustees. Short-term
investments that will mature within 60 days are valued by Schroders using
amortized cost pursuant to procedures adopted by the Board of Trustees. The net
asset value of the Fund's Investor Shares may differ from that of its Advisor
Shares due to differences in the expenses of Investor Shares and Advisor Shares.

HOW TO BUY SHARES

You may purchase Advisor Shares of the Fund directly from the Trust (through
Schroder Fund Advisors Inc., the distributor of the Trust's shares) or through
the Fund's transfer agent, Boston Financial Data Services, Inc. ("BFDS"), or
through a service organization such as a bank, trust company, broker-dealer, or
other financial organization (a "Service Organization") having an arrangement
with Schroder Fund Advisors Inc. If you do not have a Service Organization,
Schroder Fund Advisors Inc. can provide you with a list of available firms. Your
Service Organization is responsible for forwarding all of the necessary
documentation to the Trust, and may charge you separately for its services.

The purchase, redemption and exchange policies and fees charged by such Service
Organizations may be different than those of the Fund. For instance, banks,
brokers, retirement plans and financial advisers may charge transaction fees in
addition to any fees charged by the Fund, and may set different minimums or
limitations on buying, exchanging, or redeeming Advisor Shares. Please consult a
representative of your Service Organization for further information.

If the Advisor Shares you purchase will be held in your own name (rather than
the name of your Service Organization), your payment for the shares must be
accompanied by a completed Account Application and payment by check or wire as
described below. Account Applications for Advisor Shares may be obtained from
BFDS at the address provided below under "Purchases by Check," from your Service
Organization, or by calling the Schroder Mutual Funds at (800) 464-3108 (from
outside the United States, please call (617) 483-5000 and ask to speak with a
Schroder Mutual Funds representative). Acceptance of your order will be delayed
pending receipt of additional documentation, such as copies of corporate
resolutions and instruments of authority, from corporations, administrators,
executors, personal representatives, directors, or custodians.

The Fund sells its Advisor Shares at their net asset value next determined after
the Fund, its transfer agent, BFDS, or another authorized broker or financial
institution (as described below) receives your request in good order (meaning
that the request meets the requirements set out below and in the Account
Application, and otherwise meets the requirements implemented from time to time
by the Fund's transfer agent or the Fund). In order for you to receive the
Fund's next determined net asset value, the Fund, BFDS, the Service
Organization, or the authorized broker or financial institution must receive
your order before the close of trading on the Exchange (normally 4:00 p.m.,
Eastern Time). The Trust reserves the right to reject any order to purchase
Advisor Shares of the Fund. The Trust generally expects to inform any persons
that their purchase has been rejected within 24 hours.

Certain brokers or other financial institutions may accept purchase orders for
Advisor Shares on behalf of the Fund. Such brokers or financial institutions may
designate other intermediaries to accept purchase orders on behalf of the Fund.
For purposes of pricing, the Fund will be deemed to have received a purchase
order when an authorized broker or financial institution or, if applicable, a
broker or financial institution's authorized designee, receives the order.
Agreements between such brokers or financial institutions and Schroder Fund
Advisors Inc., the Trust's distributor, provide that these orders will be priced
at the Fund's net asset value next determined after they are received by the
broker or financial institution or authorized designee. Orders received in good
order prior to the close of the Exchange on any day the Exchange is open for
trading will receive the net asset value next determined as of the end of that
day. Orders received after that time will receive the next day's net asset
value.

The minimum investments for initial and additional purchases of Advisor Shares
of the Fund are as follows:

INITIAL INVESTMENT ADDITIONAL INVESTMENTS
------------------ ----------------------
REGULAR ACCOUNTS $2,500 $1,000
TRADITIONAL AND ROTH IRAS $2,500 $1,000

The Trust may, in its sole discretion, waive these minimum initial or subsequent
investment amounts for share purchases by: an employee of Schroders, any of its
affiliates or a financial intermediary authorized to sell shares of a Fund, or
such employee's spouse or life partner, or children or step-children age 21 or
younger; investment advisory clients of Schroders; and current or former
Trustees. For share purchases made through certain fund networks or other
financial intermediaries, the investment minimums associated with the policies
and programs of the fund network or financial intermediary will apply.

Advisor Shares of the Fund are intended for purchase by investors making a
minimum initial investment of $2,500 through a regular account or a traditional
or Roth IRA account and purchasing through an investment intermediary. Investor
Shares of the Fund are offered through another prospectus and are intended for
investors making a minimum initial investment of $250,000 and purchasing
directly from the Fund.

The Fund does not issue share certificates.

The Trust may suspend the offering of Advisor Shares of the Fund for any period
of time. The Trust may change any investment minimum from time to time.

Purchases by check. You may purchase Advisor Shares of the Fund by mailing a
check (in U.S. dollars) payable to the Fund. If you wish to purchase Advisor
Shares of two or more Funds, make your check payable to Schroder Mutual Funds
and include written instructions as to how the amount of your check should be
allocated among the Funds whose shares you are purchasing. Schroder Mutual Funds
will not accept third-party checks or starter checks. You should direct your
check and your completed Account Application as follows:

REGULAR MAIL OVERNIGHT OR EXPRESS MAIL
Schroder Mutual Funds Boston Financial Data Services, Inc.
P.O. Box 8507 Attn: Schroder Mutual Funds
Boston, MA 02266 30 Dan Road
Canton, MA 02021

For initial purchases, a completed Account Application must accompany your
check.

Once you have an account number, you may purchase Advisor Shares through your
Service Organization or directly from the Fund by calling BFDS at (800) 464-3108
to give notice that you will send funds by wire, and obtain a wire reference
number. (From outside the United States, please call (617) 483-5000 and ask to
speak with a Schroder Mutual Funds representative.) Please be sure to obtain a
wire reference number. Instruct your bank to wire funds with the assigned
reference number as follows:

BFDS will not process your purchase until it receives the wired funds.

Automatic purchases. If you purchase Advisor Shares directly from the Trust and
the shares are held in your own name, you can make regular investments of $100
or more per month or quarter in Advisor Shares of a Fund through automatic
deductions from your bank account. Please complete the appropriate section of
the Account Application if you would like to utilize this option. For more
information, please call (800) 464-3108. If you purchase Advisor Shares through
a Service Organization, your firm may also provide automatic purchase options.
Please contact your Service Organization for details.

Purchases in kind. Investors may purchase Advisor Shares of the Fund for cash or
in exchange for securities, subject to the determination by Schroders in its
discretion that the securities are acceptable. (For purposes of determining
whether securities will be acceptable, Schroders will consider, among other
things, whether they are liquid securities of a type consistent with the
investment objective and policies of the Fund and have a readily ascertainable
value.) If the Fund receives securities from an investor in exchange for Advisor
Shares of the Fund, the Fund will under some circumstances have the same tax
basis in the securities as the investor had prior to the exchange (and the
Fund's gain for tax purposes would be calculated with regard to the investor's
tax basis), and in such cases the Fund's holding period in those securities
would include the investor's holding period. Any gain on the sale of securities
received in exchange for Advisor Shares of the Fund would be subject to
distribution as capital gain to all of the Fund's shareholders. (In some
circumstances, receipt of securities from an investor in exchange for Advisor
Shares of the Fund may be a taxable transaction to the investor, in which case
the Fund's tax basis in the securities would reflect the fair market value of
the securities on the date of the exchange, and its holding period in the
securities would begin on that date.) The Fund values securities accepted by
Schroders in the same manner as are the Fund's portfolio securities as of the
time of the next determination of the Fund's net asset value. Although the Fund
seeks to determine the fair value of securities contributed to the Fund, any
valuation that does not reflect fair value may dilute the interests of the
purchasing shareholder or the other shareholders of the Fund. All rights
reflected in the market price of accepted securities at the time of valuation
become the property of the Fund and must be delivered to the Fund upon receipt
by the investor. Investors may realize a taxable gain or loss upon the exchange.
Investors interested in purchases through exchange should telephone Schroders at
(800) 464-3108, their Schroders client representative, or other financial
intermediary.

HOW TO SELL SHARES

When you may redeem. You may sell your Advisor Shares back to the Fund on any
day the Exchange is open either through your Service Organization or directly to
the Fund. If your shares are held in the name of a Service Organization, you may
only sell the shares through that Service Organization. The Service Organization
may charge you a fee for its services. If you choose to sell your shares
directly to the Fund, you may do so by sending a letter of instruction or stock
power form to Schroder Mutual Funds, or by calling BFDS at (800) 464-3108.
Redemption requests received in good order by Schroder Mutual

Funds, BFDS, your Service Organization or another authorized broker or financial
institution (as described below) prior to the close of the Exchange on any day
the Exchange is open for trading will be priced at the net asset value next
determined as of the end of that day. Orders received after that time will
receive the next day's net asset value. A redemption request is in good order if
it includes the exact name in which the shares are registered, the investor's
account number, and the number of shares or the dollar amount of shares to be
redeemed, and, for written requests, if it is signed in accordance with the
account registration. A bank, broker-dealer, or certain other financial
institutions must guarantee the signature(s) of all account holders for any
redemption request in excess of $50,000, or for any amount being sent to an
address or bank account that is not registered on the account. The Stamp 2000
Medallion Guarantee is the only acceptable form of guarantee. An investor can
obtain this signature guarantee from a commercial bank, savings bank, credit
union, or broker-dealer that participates in one of the Medallion signature
guarantee programs. You may redeem your shares by telephone only if you elected
the telephone redemption privilege option on your Account Application or
otherwise in writing. Telephone redemption proceeds will be sent only to you at
an address on record with the Fund for at least 30 days. Unless otherwise
agreed, you may only exercise the telephone redemption privilege to redeem
shares worth not more than $50,000. The Trust may require additional
documentation from shareholders that are corporations, partnerships, agents,
fiduciaries, surviving joint owners, those acting through powers of attorney, or
similar delegation.

If you redeem shares through your Service Organization, your Service
Organization is responsible for ensuring that the Transfer Agent receives your
redemption request in proper form. If your Service Organization receives Federal
Reserve wires, you may instruct that your redemption proceeds be forwarded by
wire to your account with your Service Organization; you may also instruct that
your redemption proceeds be forwarded to you by a wire transfer. Please indicate
your Service Organization's or your own complete wiring instructions. Your
Service Organization may charge you separately for this service.

Certain brokers or other financial institutions may accept redemption orders for
Advisor Shares on behalf of the Fund. Such brokers or financial institutions may
designate other intermediaries to accept redemption orders on behalf of the
Fund. For purposes of pricing, the Fund will be deemed to have received a
redemption order when an authorized broker or financial institution or, if
applicable, a broker or financial institution's authorized designee, receives
the order. Agreements between such brokers or financial institutions and
Schroder Fund Advisors Inc., the Trust's distributor, provide that these orders
will be priced at the Fund's net asset value next determined after they are
received by the broker or financial institution or authorized designee. Orders
received in good order prior to the close of the Exchange on any day the
Exchange is open for trading will receive the net asset value next determined as
of the end of that day. Orders received after that time will receive the next
day's net asset value.

The Trust will pay you for your redemptions as promptly as possible and in any
event within seven days after the request for redemption is received in good
order. The Trust generally sends payment for shares on the business day after a
request is received. In case of emergencies, the Trust may suspend redemptions
or postpone payment for more than seven days, as permitted by law. If you paid
for your Advisor Shares by check, the Trust will not send you your redemption
proceeds until the check you used to pay for the shares has cleared, which may
take up to 15 calendar days from the purchase date.

Brokers or other agents may charge investors a fee for effecting transactions in
shares of a Fund, in addition to any fees the Fund charges.

Involuntary redemptions. If, because of your redemptions, your account balance
for the Fund falls below a minimum amount set by the Trustees (presently
$2,000), the Trust may choose to redeem your Advisor Shares in the Fund and pay
you for them. You will receive at least 30 days' written notice before the Trust
redeems your Advisor Shares, and you may purchase additional Advisor Shares at
any time to avoid a redemption. The Trust may also redeem Advisor Shares if you
own shares of the Fund above a maximum amount set by the Trustees. There is
currently no maximum, but the Trustees may establish one at any time, which
could apply to both present and future shareholders.

For purposes of computing the redemption fee, redemptions by a shareholder to
which the fee applies will be deemed to have been made on a first-purchased,
first-redeemed basis.

EXCHANGES

You can exchange your Advisor Shares of the Fund for Advisor Shares of other
funds in the Schroder family of funds at any time at their respective net asset
values. An exchange of shares of the Fund may be subject to a redemption fee of
2.00% as described above under "Redemption Fee" (such that the exchange would be
made at net asset value minus any redemption fee). The Trust would treat the
exchange as a sale of your Advisor Shares, and any gain on the exchange will
generally be subject to tax. For a listing of the Schroder funds available for
exchange and to exchange Advisor Shares, please

call (800) 464-3108. (From outside the United States, please call (617) 483-5000
and ask to speak with a representative of the Schroder Mutual Funds.) In order
to exchange shares by telephone, you must complete the appropriate section of
the Account Application. The Trust and Schroders reserve the right to change or
suspend the exchange privilege at any time. Schroders would notify shareholders
of any such change or suspension.

ADDITIONAL INFORMATION ABOUT ADVISOR SHARES; DISTRIBUTION PLAN

The Trust sells Advisor Shares of the Fund at their net asset value without any
sales charges or loads, so that the full amount of your purchase payment is
invested in the Fund. You also receive the full value of your Advisor Shares
when you sell them back to the Fund, without any deferred sales charge.

Distribution plans. The Fund has adopted a Distribution Plan pursuant to Rule
12b-1 under the Investment Company Act of 1940, as amended, that allows the Fund
to pay distribution and other fees with respect to its Advisor Shares. Under the
Distribution Plan, the Fund may make payments at an annual rate of up to 0.25%
of the average daily net assets attributable to its Advisor Shares to compensate
the distributor for distribution services and certain shareholder services with
respect to the Fund's Advisor Shares.

Because the fees are paid out of the Fund's assets on an ongoing basis, over
time these fees will increase the cost of an investment in Advisor Shares of the
Fund and may cost you more than paying other types of sales charges.

In addition, the Fund may pay Schroders or its affiliates, banks,
broker-dealers, financial advisors, or other financial institutions fees for
sub-administration, sub-transfer agency, and other shareholder services
associated with shareholders whose shares are held of record in omnibus or other
group accounts. In addition, the Fund's service providers, including Schroders,
or any of their affiliates, may from time to time, make these types of payment
or payments for other shareholder services or distribution, out of their own
resources and without additional cost to the Fund or its shareholders.

DIVIDENDS AND DISTRIBUTIONS

The Fund declares dividends from net investment income and distributes these
dividends annually. The Fund distributes any net realized capital gain at least
annually. The Fund make distributions from net capital gain after applying any
available capital loss carryovers.

Shares begin to earn dividends on the first business day following the day of
purchase. Shares earn dividends through the date of redemption.

YOU CAN CHOOSE FROM FOUR DISTRIBUTION OPTIONS:

o Reinvest all distributions in additional Advisor Shares of your Fund;

o Receive distributions from net investment income in cash while
reinvesting capital gains distributions in additional Advisor Shares
of your Fund;

o Receive distributions from net investment income in additional Advisor
Shares of your Fund while receiving capital gain distributions in
cash; or

o Receive all distributions in cash.

You can change your distribution option by notifying BFDS in writing. If you do
not select an option when you open your account, all distributions by the Fund
will be reinvested in Advisor Shares of the Fund. You will receive a statement
confirming reinvestment of distributions in additional Fund shares promptly
following the period in which the reinvestment occurs.

FREQUENT PURCHASES AND REDEMPTIONS OF FUND SHARES

Excessive trading can hurt Fund performance, operations, and shareholders. The
Board of Trustees of the Fund has adopted policies and procedures with respect
to frequent purchases and redemptions of Fund shares by Fund shareholders. The
Fund discourages, and does not accommodate, frequent purchases and redemption of
the Fund's shares to the extent Schroders believes that such trading is harmful
to a Fund's shareholders, although the Fund will not necessarily prevent all
frequent trading in its shares. The Fund reserves the right, in its discretion,
to reject any purchase, in whole or in part (including, without limitation,
purchases by persons whose trading activity Schroders believes could be harmful
to the Fund). The Trust or Schroders may also limit the amount or number of
exchanges or reject any purchase by exchange if the Trust or Schroders believes
that the investor in question is engaged in "market timing activities" or
similar activities that may be harmful to the Fund or its shareholders, although
the Trust and Schroders have not established any maximum amount or number of
such exchanges that may occur in any period. The Trust generally expects to
inform any persons that their purchase has been rejected within 24 hours. In
addition, the Boards of Trustees of the Fund have established a 2.00% redemption
fee for shares of the Fund held for two months or less from their date of
purchase. See "How to Sell Shares - Redemption Fee" for further information. The
ability of Schroders to monitor trades that are placed through omnibus or other
nominee accounts is limited in those instances in which the broker, retirement
plan administrator, or fee-based program sponsor does not provide complete
information to Schroders regarding underlying beneficial owners of Fund shares.
The Trust or its distributor may enter into written agreements with financial
intermediaries who hold omnibus accounts that require the intermediaries to
provide certain information to the Trust regarding shareholders who hold shares
through such accounts and to restrict or prohibit trading in Fund shares by
shareholders identified by the Trust as having engaged in trades that violate
the Trust's "market timing" policies. The Trust or Schroders may take any steps
they consider appropriate in respect of frequent trading in omnibus accounts,
including seeking additional information from the holder of the omnibus account
or potentially closing the omnibus account (although there can be no assurance
that the Trust or Schroders would do so). Please see the SAI for additional
information on frequent purchases and redemptions of Fund shares. There can be
no assurance that the Fund or Schroders will identify all harmful purchase or
redemption activity, or market timing or similar activities, affecting the Fund,
or that the Fund or Schroders will be successful in limiting or eliminating such
activities.

PAYMENT OF FEES

TAXES

long-term capital gains. Distributions of gains from the sale of investments
that the Fund owned for one year or less and gains on the sale of bonds
characterized as a market discount sale will be taxable as ordinary income. For
taxable years beginning before January 1, 2011, distributions of investment
income designated by the Fund as derived from "qualified dividend income" will
be taxed in the hands of individuals at rates applicable to long-term capital
gains, provided holding period and other requirements are met at both the
shareholder and Fund level.

TAXES WHEN YOU SELL, REDEEM OR EXCHANGE YOUR SHARES. Any gain resulting from a
redemption, sale or exchange (including an exchange for shares of another fund)
of your shares in the Fund will also generally be subject to federal income tax
at either short-term or long-term capital gain rates depending on how long you
have owned your shares.

DERIVATIVES. The Fund's use of derivatives may affect the amount, timing, and
character of distributions to shareholders and, therefore, may increase the
amount of taxes payable by shareholders.

DISCLOSURES OF FUND PORTFOLIO INFORMATION

USA PATRIOT ACT

INVESTMENT MANAGER
Schroder Investment Management North America Inc.
875 Third Avenue
New York, New York 10022

INVESTMENT SUB-ADVISER
Schroder Investment Management North America Limited
31 Gresham Street
London EC2V 7QA

ADMINISTRATOR

SEI Investments Global Funds Services
1 Freedom Valley Drive
Oaks, Pennsylvania 19456

CUSTODIAN
J.P. Morgan Chase Bank
270 Park Avenue
New York, New York 10017

DISTRIBUTOR
Schroder Fund Advisors Inc.
875 Third Avenue
New York, New York 10022

TRANSFER AND DIVIDEND DISBURSING AGENT
Boston Financial Data Services, Inc.
Two Heritage Drive
North Quincy, Massachusetts 02171

COUNSEL
Ropes & Gray LLP
One International Place
Boston, Massachusetts 02110

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
PricewaterhouseCoopers LLP
Two Commerce Square
Suite 1700
2001 Market Street
Philadelphia, Pennsylvania 19103

SCHRODER SERIES TRUST
Schroder International Diversified Value Fund

SCHRODER SERIES TRUST
875 Third Avenue
New York, New York 10022
(800) 464-3108

File No. 811-7840 - Schroder Series Trust

SCHRODER SERIES TRUST

Schroder International Diversified Value Fund

FORM N-1A
PART B

STATEMENT OF ADDITIONAL INFORMATION

Dated August 30, 2006

This Statement of Additional Information ("SAI") is not a prospectus and is only
authorized for distribution when accompanied or preceded by a Prospectus for the
Fund, as amended or supplemented from time to time. This SAI relates to the
Fund's Investor Shares and Advisor Shares. Investor Shares and Advisor Shares
are offered through separate Prospectuses, each dated August 30, 2006, as
amended or supplemented from time to time (each, a "Prospectus," and together,
the "Prospectuses"). This SAI contains information which may be useful to
investors but which is not included in the Prospectuses. Investors may obtain
free copies of the Prospectuses by calling the Fund at (800) 464-3108. From
outside the United States, please call (617) 483-5000 and ask to speak with a
Schroder Mutual Funds representative. The Fund is a series of Schroder Series
Trust (the "Trust").

Certain disclosure has been incorporated by reference into this SAI from the
Trust's most recent annual report. For a free copy of the annual report, please
call 1-800-464-3108.

TABLE OF CONTENTS

TRUST HISTORY............................................................. 1
FUND CLASSIFICATION....................................................... 1
CAPITALIZATION AND SHARE CLASSES.......................................... 1
ADDITIONAL INFORMATION CONCERNING THE FUND'S PRINCIPAL INVESTMENT
STRATEGIES............................................................. 2
NON-PRINCIPAL INVESTMENTS, INVESTMENT PRACTICES AND RISKS................. 16
INVESTMENT RESTRICTIONS................................................... 19
DISCLOSURE OF PORTFOLIO HOLDINGS.......................................... 21
MANAGEMENT OF THE TRUST................................................... 23
SCHRODERS AND ITS AFFILIATES.............................................. 30
PORTFOLIO MANAGERS........................................................ 31
MANAGEMENT CONTRACT....................................................... 33
ADMINISTRATIVE SERVICES................................................... 35
DISTRIBUTOR............................................................... 36
BROKERAGE ALLOCATION AND OTHER PRACTICES.................................. 36
DETERMINATION OF NET ASSET VALUE.......................................... 38
REDEMPTION OF SHARES...................................................... 39
ARRANGEMENTS PERMITTING FREQUENT PURCHASES AND REDEMPTIONS OF FUND
SHARES................................................................. 40
TAXES..................................................................... 40
PRINCIPAL HOLDERS OF SECURITIES........................................... 44
CUSTODIAN................................................................. 44
TRANSFER AGENT AND DIVIDEND DISBURSING AGENT.............................. 44
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM............................. 45
CODE OF ETHICS............................................................ 45
PROXY VOTING POLICIES AND PROCEDURES...................................... 45
LEGAL COUNSEL............................................................. 45
SHAREHOLDER LIABILITY..................................................... 45
FINANCIAL STATEMENTS...................................................... 45
APPENDIX A................................................................ A-1

STATEMENT OF ADDITIONAL INFORMATION

TRUST HISTORY

Schroder Series Trust (the "Trust") is a Massachusetts business trust
organized under the laws of The Commonwealth of Massachusetts on May 6, 1993.
The Trust's Agreement and Declaration of Trust (as amended, the "Declaration of
Trust"), which is governed by Massachusetts law, is on file with the Secretary
of State of The Commonwealth of Massachusetts. Schroder International
Diversified Value Fund (the "Fund") is a series of the Trust. The Trust
currently also comprises seven other publicly offered series, Schroder Enhanced
Income Fund, Schroder Total Return Fixed Income Fund, Schroder Municipal Bond
Fund, Schroder Short-Term Municipal Bond Fund, Schroder Emerging Market Equity
Fund, Schroder U.S. Small and Mid Cap Opportunities Fund and Schroder Strategic
Bond Fund. Schroder Investment Management North America Inc. ("Schroders")
serves as investment manager to the Fund. Schroder Investment Management North
America Limited ("SIMNA Ltd.") serves as investment sub-adviser to the Fund.

FUND CLASSIFICATION

The Fund is an open-end management investment company registered under
the Investment Company Act of 1940, as amended (the "Investment Company Act" or
"1940 Act"). The Fund is a "diversified" investment company under the Investment
Company Act. For a diversified investment company, this means that with respect
to 75% of the Fund's total assets (i) the Fund may not invest in securities of
any issuer if, immediately after such investment, more than 5% of the total
assets of the Fund (taken at current value) would be invested in the securities
of that issuer (this limitation does not apply to investments in U.S. government
securities or securities of other investment companies) or (ii) the Fund may not
invest in a security if, as a result of such investment, it would hold more than
10% (taken at the time of such investment) of the outstanding voting securities
of any one issuer (this limitation does not apply to investments in U.S.
Government securities or securities of other investment companies). The Fund is
not subject to this limitation with respect to the remaining 25% of its total
assets.

CAPITALIZATION AND SHARE CLASSES

The Trust has an unlimited number of shares of beneficial interest
that may, without shareholder approval, be divided into an unlimited number of
series of such shares, which, in turn, may be divided into an unlimited number
of classes of such shares. The shares of the Fund described in this Statement of
Additional Information ("SAI") are currently divided into two classes, Investor
Shares and Advisor Shares. Each class of shares is offered through a separate
Prospectus. Unlike Investor Shares, Advisor Shares are currently subject to
distribution fees, so that the performance of the Fund's Investor Shares will
normally be more favorable than that of the Fund's Advisor Shares over the same
time period. Generally, expenses and liabilities particular to a class of the
Fund, such as distribution fees applicable only to Advisor Shares, are allocated
only to that class. Expenses and liabilities not related to a particular class
are allocated in relation to the respective net asset value of each class, or on
such other basis as the Trustees may in their discretion consider fair and
equitable to each class. The Fund may suspend the sale of shares at any time.

-1-

Shares entitle their holders to one vote per share, with fractional
shares voting proportionally; however, a separate vote will be taken by each
Fund of the Trust or class of shares on matters affecting the particular Fund or
class, as determined by the Trustees. For example, a change in a fundamental
investment policy for the Fund would be voted upon only by shareholders of that
Fund and a change to a distribution plan relating to a particular class and
requiring shareholder approval would be voted upon only by shareholders of that
class. Shares have noncumulative voting rights. Although the Trust is not
required to hold annual meetings of its shareholders, shareholders have the
right to call a meeting to elect or remove Trustees or to take other actions as
provided in the Declaration of Trust. Shares have no preemptive or subscription
rights, and are transferable. Shares are entitled to dividends as declared by
the Trust as approved by the Trustees, and if the Fund were liquidated, each
class of shares of the Fund would receive the net assets of that Fund
attributable to the class of shares. Because Investor and Advisor Shares are
subject to different expenses, the Fund's dividends and other distributions will
normally differ between the two classes.

ADDITIONAL INFORMATION CONCERNING THE FUND'S PRINCIPAL INVESTMENT STRATEGIES

The following discussion provides additional information concerning
the Fund's principal investment strategies and the principal risks of the Fund
described in the Prospectuses.

EQUITY SECURITIES. The Fund may primarily invest in equity securities.
Equity securities are securities that represent an ownership interest (or the
right to acquire such an interest) in a company and include common and preferred
stocks. Common stocks represent an equity or ownership interest in an issuer.
Preferred stocks represent an equity or ownership interest in an issuer that
pays dividends at a specified rate and that has priority over common stock in
the payment of dividends. In the event an issuer is liquidated or declares
bankruptcy, the claims of owners of bonds take priority over holders of
preferred stock, whose claims take priority over the claims of those who own
common stock.

While offering greater potential for long-term growth, equity
securities generally are more volatile and riskier than some other forms of
investment, particularly debt securities. Therefore, the value of an investment
in a Fund may at times decrease instead of increase.

The Fund's investments may include securities traded
"over-the-counter" as well as those traded on a securities exchange. Some
securities, particularly over-the-counter securities, may be more difficult to
sell under some market conditions.

Smaller Company Equity Securities. The Fund may invest in equity
securities of companies with small market capitalizations. Such investments may
involve greater risk than is usually associated with larger, more established
companies. These companies often have sales and earnings growth rates that
exceed those of companies with larger market capitalization. Such growth rates
may in turn be reflected in more rapid share price appreciation. However,
companies with small market capitalizations often have limited product lines,
markets or financial resources and may be dependent upon a relatively small
management group. These securities may have limited marketability and may be
subject to more abrupt or erratic movements in price than securities of
companies with larger market capitalizations or market averages in general.
Therefore, to the extent the Fund invests in securities with small market
capitalizations, the net asset value of the Fund may fluctuate more widely than
market averages.

-2-

Preferred Stock. Preferred stock represents an equity interest in a
company that generally entitles the holder to receive, in preference to holders
of other stocks such as common stocks, dividends at a specified rate and a fixed
share of proceeds resulting from a liquidation of the company. Preferred stock,
unlike common stock, generally has a stated dividend rate payable from the
corporation's earnings. Preferred stock dividends may be "cumulative" or
"non-cumulative." "Cumulative" dividend provisions require all or a portion of
prior unpaid dividends to be paid to preferred stockholders before dividends can
be paid on the issuer's common stock. Preferred stock may be "participating"
stock, which means that it may be entitled to a dividend that exceeds the stated
dividend in certain cases.

If interest rates rise, the fixed dividend on preferred stocks may be
less attractive, causing the price of preferred stocks to decline.

A company's preferred stock generally pays a dividend only after the
company makes required payments to holders of its bonds and other debt. In
addition, the rights of preferred stock on distribution of a company's assets in
the event of a liquidation are generally subordinate to the rights of holders of
the company's bonds or other creditors. As a result, the value of preferred
stock will usually react more strongly than bonds and other debt to actual or
perceived changes in the company's financial condition or prospects. Preferred
stocks of small companies may be more vulnerable to adverse developments than
those of larger companies.

CERTAIN DERIVATIVE INSTRUMENTS. Derivative instruments are financial
instruments whose value depends upon, or is derived from, the value of an
underlying asset, such as a security, index or currency. As described below, to
the extent permitted under "Investment Restrictions" below and in the
Prospectuses, the Fund may engage in a variety of transactions involving the use
of derivative instruments, including options and futures contracts on securities
and securities indices, options on futures contracts, and short sales. These
transactions may be used by the Fund for hedging purposes or, to the extent
permitted by applicable law, to increase its current return. The Fund may also
engage in derivative transactions involving foreign currencies. See "Foreign
Currency Transactions." Use of derivatives other than for hedging purposes may
be considered speculative, and when the Fund invests in a derivative instrument
it could lose more than the principal amount invested.

OPTIONS. The Fund may purchase and sell covered put and call options
on its portfolio securities to enhance investment performance and to protect
against changes in market prices.

Covered call options. The Fund may write covered call options on its portfolio
securities to realize a greater current return through the receipt of premiums
than it would realize on its securities alone. Such option transactions may also
be used as a limited form of hedging against a decline in the price of
securities owned by the Fund.

A call option gives the holder the right to purchase, and obligates
the writer to sell, a security at the exercise price at any time before the
expiration date. A call option is "covered" if the writer, at all times while
obligated as a writer, either owns the underlying securities (or comparable
securities satisfying the cover requirements of the securities exchanges), or
has the right to acquire such securities through immediate conversion of
securities.

In return for the premium received when it writes a covered call
option, the Fund gives up some or all of the opportunity to profit from an
increase in the market price of the securities covering the call option during
the life of the option. The Fund retains the risk of loss should the price of
such securities

-3-

decline. If the option expires unexercised, the Fund realizes a gain equal to
the premium, which may be offset by a decline in price of the underlying
security. If the option is exercised, the Fund realizes a gain or loss equal to
the difference between the Fund's cost for the underlying security and the
proceeds of the sale (exercise price minus commissions) plus the amount of the
premium.

The Fund may terminate a call option that it has written before it expires by
entering into a closing purchase transaction. The Fund may enter into closing
purchase transactions in order to free itself to sell the underlying security or
to write another call on the security, realize a profit on a previously written
call option, or protect a security from being called in an unexpected market
rise. Any profits from a closing purchase transaction may be offset by a decline
in the value of the underlying security. Conversely, because increases in the
market price of a call option will generally reflect increases in the market
price of the underlying security, any loss resulting from a closing purchase
transaction is likely to be offset in whole or in part by unrealized
appreciation of the underlying security owned by the Fund.

Covered put options. The Fund may write covered put options in order to enhance
its current return. Such options transactions may also be used as a limited form
of hedging against an increase in the price of securities that the Fund plans to
purchase. A put option gives the holder the right to sell, and obligates the
writer to buy, a security at the exercise price at any time before the
expiration date. A put option is "covered" if the writer segregates cash and
high-grade short-term debt obligations or other permissible collateral equal to
the price to be paid if the option is exercised.

In addition to the receipt of premiums and the potential gains from
terminating such options in closing purchase transactions, the Fund also
receives interest on the cash and debt securities maintained to cover the
exercise price of the option. By writing a put option, the Fund assumes the risk
that it may be required to purchase the underlying security for an exercise
price higher than its then current market value, resulting in a potential
capital loss unless the security later appreciates in value.

The Fund may terminate a put option that it has written before it
expires by a closing purchase transaction. Any loss from this transaction may be
partially or entirely offset by the premium received on the terminated option.

Purchasing put and call options. The Fund may also purchase put options to
protect portfolio holdings against a decline in market value. This protection
lasts for the life of the put option because the Fund, as a holder of the
option, may sell the underlying security at the exercise price regardless of any
decline in its market price. In order for a put option to be profitable, the
market price of the underlying security must decline sufficiently below the
exercise price to cover the premium and transaction costs that the Fund must
pay. These costs will reduce any profit the Fund might have realized had it sold
the underlying security instead of buying the put option.

The Fund may purchase call options to hedge against an increase in the
price of securities that the Fund wants ultimately to buy. Such hedge protection
is provided during the life of the call option since the Fund, as holder of the
call option, is able to buy the underlying security at the exercise price
regardless of any increase in the underlying security's market price. In order
for a call option to be profitable, the market price of the underlying security
must rise sufficiently above the exercise price to cover the premium and
transaction costs. These costs will reduce any profit the Fund might have
realized had it bought the underlying security at the time it purchased the call
option.

-4-

The Fund may also purchase put and call options to enhance its current
return. The Fund may also buy and sell combinations of put and call options on
the same underlying security to earn additional income.

Options on foreign securities. The Fund may purchase and sell options on foreign
securities if in Schroders' opinion the investment characteristics of such
options, including the risks of investing in such options, are consistent with
the Fund's investment objectives. It is expected that risks related to such
options will not differ materially from risks related to options on U.S.
securities. However, position limits and other rules of foreign exchanges may
differ from those in the U.S. In addition, options markets in some countries,
many of which are relatively new, may be less liquid than comparable markets in
the U.S.

Risks involved in the sale of options. Options transactions involve certain
risks, including the risks that Schroders will not forecast interest rate or
market movements correctly, that the Fund may be unable at times to close out
such positions, or that hedging transactions may not accomplish their purpose
because of imperfect market correlations. The successful use of these strategies
depends on the ability of Schroders to forecast market and interest rate
movements correctly.

An exchange-listed option may be closed out only on an exchange which
provides a secondary market for an option of the same series. Although the Fund
will enter into an option position only if Schroders believes that a liquid
secondary market exists, there is no assurance that a liquid secondary market on
an exchange will exist for any particular option or at any particular time. If
no secondary market were to exist, it would be impossible to enter into a
closing transaction to close out an option position. As a result, the Fund may
be forced to continue to hold, or to purchase at a fixed price, a security on
which it has sold an option at a time when Schroders believes it is inadvisable
to do so.

Higher than anticipated trading activity or order flow or other
unforeseen events might cause The Options Clearing Corporation or an exchange to
institute special trading procedures or restrictions that might restrict the
Fund's use of options. The exchanges have established limitations on the maximum
number of calls and puts of each class that may be held or written by an
investor or group of investors acting in concert. It is possible that the Fund
and other clients of Schroders may be considered such a group. These position
limits may restrict the Fund's ability to purchase or sell options on particular
securities.

As described below, the Fund generally expects that its options
transactions will be conducted on recognized exchanges. In certain instances,
however, the Fund may purchase and sell options in the over-the-counter markets.
Options which are not traded on national securities exchanges may be closed out
only with the other party to the option transaction. For that reason, it may be
more difficult to close out over-the-counter options than exchange-traded
options. Options in the over-the-counter market may also involve the risk that
securities dealers participating in such transactions would be unable to meet
their obligations to the Fund. Furthermore, over-the-counter options are not
subject to the protection afforded purchasers of exchange-traded options by The
Options Clearing Corporation. The Fund will, however, engage in over-the-counter
options transactions only when appropriate exchange-traded options transactions
are unavailable and when, in the opinion of Schroders, the pricing mechanism and
liquidity of the over-the-counter markets are satisfactory and the participants
are responsible parties likely to meet their contractual obligations. The Fund
will treat over-the-counter options (and, in the case of options sold by the
Fund, the underlying securities held by the Fund) as illiquid investments as
required by applicable law.

-5-

Government regulations, particularly the requirements for
qualification as a "regulated investment company" (a "RIC") under the United
States Internal Revenue Code of 1986, as amended (the "Code"), may also restrict
the Trust's use of options.

FUTURES CONTRACTS. To the extent permitted under "Investment
Restrictions" below and in the Prospectuses and by applicable law, the Fund may
buy and sell futures contracts, options on futures contracts, and related
instruments in order to hedge against the effects of adverse market changes or
to increase current return. Depending upon the change in the value of the
underlying security or index when the Fund enters into or terminates a futures
contract, the Fund may realize a gain or loss.

The Fund is operated by a person who has claimed an exclusion from the
definition of the term "commodity pool operator" under the Commodity Exchange
Act (the "CEA") and, therefore, such person is not subject to registration or
regulation as a pool operator under the CEA.

Futures on Securities and Related Options. A futures contract on a security is a
binding contractual commitment which, if held to maturity, will result in an
obligation to make or accept delivery, during a particular month, of securities
having a standardized face value and rate of return. By purchasing futures on
securities -- assuming a "long" position -- the Fund will legally obligate
itself to accept the future delivery of the underlying security and pay the
agreed price. By selling futures on securities -- assuming a "short" position --
it will legally obligate itself to make the future delivery of the security
against payment of the agreed price. Open futures positions on securities will
be valued at the most recent settlement price, unless that price does not, in
the judgment of the Fund's Valuation Committee, reflect the fair value of the
contract, in which case the positions will be fair valued by the Trustees or the
Valuation Committee.

Positions taken in the futures markets are not normally held to
maturity, but are instead liquidated through offsetting transactions that may
result in a profit or a loss. While futures positions taken by the Fund will
usually be liquidated in this manner, the Fund may instead make or take delivery
of the underlying securities whenever it appears in Schroders' judgment
economically advantageous for the Fund to do so. A clearing corporation
associated with the exchange on which futures are traded assumes responsibility
for such closing transactions and guarantees that the Fund's sale and purchase
obligations under closed-out positions will be performed at the termination of
the contract.

Hedging by use of futures on securities seeks to establish more
certainty than would otherwise be possible the effective rate of return on
portfolio securities. The Fund may, for example, take a "short" position in the
futures market by selling contracts for the future delivery of securities held
by the Fund (or securities having characteristics similar to those held by the
Fund) in order to hedge against an anticipated rise in interest rates that would
adversely affect the value of the Fund's portfolio securities. When hedging of
this character is successful, any depreciation in the value of portfolio
securities may substantially be offset by appreciation in the value of the
futures position.

On other occasions, the Fund may take a "long" position by purchasing
futures on securities. This would be done, for example, when the Fund expects to
purchase particular securities when it has the necessary cash, but expects the
rate of return available in the securities markets at that time to be less
favorable than rates currently available in the futures markets. If the
anticipated rise in the price of the securities should occur (with its
concomitant reduction in yield), the increased cost to the Fund of purchasing
the securities may be offset, at least to some extent, by the rise in the value
of the futures position taken in anticipation of the subsequent securities
purchase.

-6-

Successful use by the Fund of futures contracts on securities is
subject to Schroders' ability to predict correctly movements in the direction of
the security's price and factors affecting markets for securities. For example,
if the Fund has hedged against the possibility of an increase in interest rates
which would adversely affect the market prices of securities held by it and the
prices of such securities increase instead, the Fund will lose part or all of
the benefit of the increased value of its securities which it has hedged because
it will have offsetting losses in its futures positions. In addition, in such
situations, if the Fund has insufficient cash, it may have to sell securities to
meet daily maintenance margin requirements. The Fund may have to sell securities
at a time when it may be disadvantageous to do so.

The Fund may purchase and write put and call options on certain
futures contracts, as they become available. Such options are similar to options
on securities except that options on futures contracts give the purchaser the
right, in return for the premium paid, to assume a position in a futures
contract (a long position if the option is a call and a short position if the
option is a put) at a specified exercise price at any time during the period of
the option. As with options on securities, the holder or writer of an option may
terminate his position by selling or purchasing an option of the same series.
There is no guarantee that such closing transactions can be effected. The Fund
will be required to deposit initial margin and maintenance margin with respect
to put and call options on futures contracts written by it pursuant to brokers'
requirements, and, in addition, net option premiums received will be included as
initial margin deposits. See "Margin Payments" below. Compared to the purchase
or sale of futures contracts, the purchase of call or put options on futures
contracts involves less potential risk to the Fund because the maximum amount at
risk is the premium paid for the options plus transactions costs. However, there
may be circumstances when the purchase of call or put options on a futures
contract would result in a loss to the Fund when the purchase or sale of the
futures contracts would not, such as when there is no movement in the prices of
securities. The writing of a put or call option on a futures contract involves
risks similar to those risks relating to the purchase or sale of futures
contracts.

Index Futures Contracts and Options. The Fund may invest in debt index futures
contracts and stock index futures contracts, and in related options. A debt
index futures contract is a contract to buy or sell units of a specified debt
index at a specified future date at a price agreed upon when the contract is
made. A unit is the current value of the index. A stock index futures contract
is a contract to buy or sell units of a stock index at a specified future date
at a price agreed upon when the contract is made. A unit is the current value of
the stock index.

Depending on the change in the value of the index between the time
when the Fund enters into and terminates an index futures transaction, the Fund
may realize a gain or loss. The following example illustrates generally the
manner in which index futures contracts operate. The Standard & Poor's 100 Stock
Index is composed of 100 selected common stocks, most of which are listed on the
New York Stock Exchange. The S&P 100 Index assigns relative weightings to the
common stocks included in the Index, and the Index fluctuates with changes in
the market values of those common stocks. In the case of the S&P 100 Index,
contracts are to buy or sell 100 units. Thus, if the value of the S&P 100 Index
were $180, one contract would be worth $18,000 (100 units x $180). The stock
index futures contract specifies that no delivery of the actual stocks making up
the index will take place. Instead, settlement in cash must occur upon the
termination of the contract, with the settlement being the difference between
the contract price and the actual level of the stock index at the expiration of
the contract. For example, if the Fund enters into a futures contract to buy 100
units of the S&P 100 Index at a specified future date at a contract price of
$180 and the S&P 100 Index is at $184 on that future date, the Fund will gain
$400 (100 units x gain of $4). If the Fund enters into a futures contract to
sell 100 units of the stock index at a specified

-7-

future date at a contract price of $180 and the S&P 100 Index is at $182 on that
future date, the Fund will lose $200 (100 units x loss of $2).

The Fund may purchase or sell futures contracts with respect to any
securities indices. Positions in index futures may be closed out only on an
exchange or board of trade which provides a secondary market for such futures.

In order to hedge the Fund's investments successfully using futures
contracts and related options, the Fund must invest in futures contracts with
respect to indices or sub-indices the movements of which will, in Schroders'
judgment, have a significant correlation with movements in the prices of the
Fund's portfolio securities.

Options on index futures contracts are similar to options on
securities except that options on index futures contracts give the purchaser the
right, in return for the premium paid, to assume a position in an index futures
contract (a long position if the option is a call and a short position if the
option is a put) at a specified exercise price at any time during the period of
the option. Upon exercise of the option, the holder would assume the underlying
futures position and would receive a variation margin payment of cash or
securities approximating the increase in the value of the holder's option
position. If an option is exercised on the last trading day prior to the
expiration date of the option, the settlement will be made entirely in cash
based on the difference between the exercise price of the option and the closing
level of the index on which the futures contract is based on the expiration
date. Purchasers of options who fail to exercise their options prior to the
exercise date suffer a loss of the premium paid.

As an alternative to purchasing and selling call and put options on
index futures contracts, the Fund may purchase and sell call and put options on
the underlying indices themselves to the extent that such options are traded on
national securities exchanges. Index options are similar to options on
individual securities in that the purchaser of an index option acquires the
right to buy (in the case of a call) or sell (in the case of a put), and the
writer undertakes the obligation to sell or buy (as the case may be), units of
an index at a stated exercise price during the term of the option. Instead of
giving the right to take or make actual delivery of securities, the holder of an
index option has the right to receive a cash "exercise settlement amount". This
amount is equal to the amount by which the fixed exercise price of the option
exceeds (in the case of a put) or is less than (in the case of a call) the
closing value of the underlying index on the date of the exercise, multiplied by
a fixed "index multiplier."

The Fund may purchase or sell options on stock indices in order to
close out its outstanding positions in options on stock indices which it has
purchased. The Fund may also allow such options to expire unexercised.

Compared to the purchase or sale of futures contracts, the purchase of
call or put options on an index involves less potential risk to the Fund because
the maximum amount at risk is the premium paid for the options plus transactions
costs. The writing of a put or call option on an index involves risks similar to
those risks relating to the purchase or sale of index futures contracts.

The Fund may also purchase warrants, issued by banks and other
financial institutions, whose values are based on the values from time to time
of one or more securities indices.

Margin Payments. When the Fund purchases or sells a futures contract, it is
required to deposit with its custodian or with a futures commission merchant an
amount of cash, U.S. Treasury bills, or other

-8-

permissible collateral equal to a small percentage of the amount of the futures
contract. This amount is known as "initial margin." The nature of initial margin
is different from that of margin in security transactions in that it does not
involve borrowing money to finance transactions. Rather, initial margin is
similar to a performance bond or good faith deposit that is returned to the Fund
upon termination of the contract, assuming the Fund satisfies its contractual
obligations.

Subsequent payments to and from the broker occur on a daily basis in a
process known as "marking to market." These payments are called "variation
margin" and are made as the value of the underlying futures contract fluctuates.
For example, when the Fund sells a futures contract and the price of the
underlying security rises above the delivery price, the Fund's position declines
in value. The Fund then pays the broker a variation margin payment equal to the
difference between the delivery price of the futures contract and the market
price of the securities underlying the futures contract. Conversely, if the
price of the underlying security falls below the delivery price of the contract,
the Fund's futures position increases in value. The broker then must make a
variation margin payment equal to the difference between the delivery price of
the futures contract and the market price of the securities underlying the
futures contract.

When the Fund terminates a position in a futures contract, a final
determination of variation margin is made, additional cash is paid by or to the
Fund, and the Fund realizes a loss or a gain. Such closing transactions involve
additional commission costs.

SPECIAL RISKS OF TRANSACTIONS IN FUTURES CONTRACTS AND RELATED OPTIONS

Liquidity Risks. Positions in futures contracts may be closed out only on an
exchange or board of trade which provides a secondary market for such futures.
Although the Fund intends to purchase or sell futures only on exchanges or
boards of trade where there appears to be an active secondary market, there is
no assurance that a liquid secondary market on an exchange or board of trade
will exist for any particular contract or at any particular time. If there is
not a liquid secondary market at a particular time, it may not be possible to
close a futures position at such time and, in the event of adverse price
movements, the Fund would continue to be required to make daily cash payments of
variation margin. However, in the event financial futures are used to hedge
portfolio securities, such securities will not generally be sold until the
financial futures can be terminated. In such circumstances, an increase in the
price of the portfolio securities, if any, may partially or completely offset
losses on the financial futures.

In addition to the risks that apply to all options transactions, there
are several special risks relating to options on futures contracts. The ability
to establish and close out positions in such options will be subject to the
development and maintenance of a liquid secondary market. It is not certain that
such a market will develop. Although the Fund generally will purchase only those
options for which there appears to be an active secondary market, there is no
assurance that a liquid secondary market on an exchange will exist for any
particular option or at any particular time. In the event no such market exists
for particular options, it might not be possible to effect closing transactions
in such options with the result that the Fund would have to exercise the options
in order to realize any profit.

Hedging Risks. There are several risks in connection with the use by the Fund of
futures contracts and related options as a hedging device. One risk arises
because of the imperfect correlation between movements in the prices of the
futures contracts and options and movements in the underlying securities or
index or in the prices of the Fund's securities which are the subject of a
hedge. Schroders will, however, attempt to reduce this risk by purchasing and
selling, to the extent possible, futures contracts

-9-

and related options on securities and indices the movements of which will, in
its judgment, correlate closely with movements in the prices of the underlying
securities or index and the Fund's portfolio securities sought to be hedged.

Successful use of futures contracts and options by the Fund for
hedging purposes is also subject to Schroders' ability to predict correctly
movements in the direction of the market. It is possible that, where the Fund
has purchased puts on futures contracts to hedge its portfolio against a decline
in the market, the securities or index on which the puts are purchased may
increase in value and the value of securities held in the portfolio may decline.
If this occurred, the Fund would lose money on the puts and also experience a
decline in value in its portfolio securities. In addition, the prices of
futures, for a number of reasons, may not correlate perfectly with movements in
the underlying securities or index due to certain market distortions. First, all
participants in the futures market are subject to margin deposit requirements.
Such requirements may cause investors to close futures contracts through
offsetting transactions which could distort the normal relationship between the
underlying security or index and futures markets. Second, the margin
requirements in the futures markets are less onerous than margin requirements in
the securities markets in general, and as a result the futures markets may
attract more speculators than the securities markets do. Increased participation
by speculators in the futures markets may also cause temporary price
distortions. Due to the possibility of price distortion, even a correct forecast
of general market trends by Schroders may still not result in a successful
hedging transaction over a very short time period.

Lack of Availability. Because the markets for certain options and futures
contracts and other derivative instruments in which the Fund may invest
(including markets located in foreign countries) are relatively new and still
developing and may be subject to regulatory restraints, the Fund's ability to
engage in transactions using such instruments may be limited. Suitable
derivative transactions may not be available in all circumstances and there is
no assurance that the Fund will engage in such transactions at any time or from
time to time. The Fund's ability to engage in hedging transactions may also be
limited by certain regulatory and tax considerations.

Other Risks. The Fund will incur brokerage fees in connection with its futures
and options transactions. In addition, while futures contracts and options on
futures may be purchased and sold to reduce certain risks, those transactions
themselves entail certain other risks. Thus, while the Fund may benefit from the
use of futures and related options, unanticipated changes in interest rates or
stock price movements may result in a poorer overall performance for the Fund
than if it had not entered into any futures contracts or options transactions.
Moreover, in the event of an imperfect correlation between the futures position
and the portfolio position which is intended to be protected, the desired
protection may not be obtained and the Fund may be exposed to risk of loss. The
Fund may be required to segregate certain of its assets on the books of its
custodian in respect of derivative transactions entered into by the Fund. As an
open-end investment company, registered with the U.S. Securities and Exchange
Commission ("SEC"), the Trust is subject to federal securities laws, including
the Investment Company Act, related rules and various SEC and SEC Staff
positions. In accordance with these positions, with respect to certain kinds of
derivatives, the Trust must "set aside" (referred to sometimes as "asset
segregation") liquid assets, or engage in other SEC- or Staff-approved measures
while the derivatives contracts are open. For example, with respect to forwards
and futures contracts that are not contractually required to "cash-settle," the
Trust must cover its open positions by setting aside liquid assets equal to the
contracts' full, notional value. With respect to forwards and futures that are
contractually required to "cash-settle," however, the Trust is permitted to set
aside liquid assets in an amount equal to the Trust's daily marked-to-market
(net) obligation (i.e. the Trust's daily net liability, if any) rather than the
notional value. By setting aside assets equal to only its

-10-

net obligation under cash-settled forward or futures the Trust will have the
ability to employ leverage to a greater extent than if the Trust were required
to segregate assets equal to the full notional value of such contracts. The use
of leverage involves certain risks. The Trust reserves the right to modify its
asset segregation policies in the future to comply with any changes in the
positions articulated from time to time by the SEC and its Staff.

FOREIGN SECURITIES. The Fund invests primarily in foreign securities.
The Fund may also invest in Eurodollar certificates of deposit and other
certificates of deposit issued by United States branches of foreign banks and
foreign branches of United States banks.

Investments in foreign securities may involve risks and considerations
different from or in addition to investments in domestic securities. There may
be less information publicly available about a foreign company than about a U.S.
company, and foreign companies are not generally subject to accounting,
auditing, and financial reporting standards and practices comparable to those in
the United States. The securities of some foreign companies are less liquid and
at times more volatile than securities of comparable U.S. companies. Foreign
brokerage commissions and other fees are also generally higher than in the
United States. Foreign settlement procedures and trade regulations may involve
certain risks (such as delay in payment or delivery of securities or in the
recovery of the Fund's assets held abroad) and expenses not present in the
settlement of domestic investments. Also, because foreign securities are
normally denominated and traded in foreign currencies, the values of the Fund's
assets may be affected favorably or unfavorably by currency exchange rates and
exchange control regulations, and the Fund may incur costs in connection with
conversion between currencies.

In addition, with respect to certain foreign countries, there is a
possibility of nationalization or expropriation of assets, imposition of
currency exchange controls, adoption of foreign governmental restrictions
affecting the payment of principal and interest, imposition of withholding or
confiscatory taxes, political or financial instability, and adverse political,
diplomatic or economic developments which could affect the values of investments
in those countries. In certain countries, legal remedies available to investors
may be more limited than those available with respect to investments in the
United States or other countries and it may be more difficult to obtain and
enforce a judgment against a foreign issuer. Also, the laws of some foreign
countries may limit the Fund's ability to invest in securities of certain
issuers located in those countries. Special tax considerations apply to foreign
securities.

Income received by the Fund from sources within foreign countries may
be reduced by withholding and other taxes imposed by such countries. Tax
conventions between certain countries and the United States may reduce or
eliminate such taxes. It is impossible to determine the effective rate of
foreign tax in advance since the amount of the Fund's assets to be invested in
various countries is not known, and tax laws and their interpretations may
change from time to time and may change without advance notice. Any such taxes
paid by the Fund will reduce its net income available for distribution to
shareholders.

EMERGING MARKET SECURITIES. The Fund may invest in securities of
companies determined by Schroders to be "emerging market" issuers. The risks of
investing in foreign securities are particularly high when securities of issuers
based in developing or emerging market countries are involved. Investing in
emerging market countries involves certain risks not typically associated with
investing in U.S. securities, and imposes risks greater than, or in addition to,
risks of investing in foreign, developed countries. These risks include: greater
risks of nationalization or expropriation of assets or confiscatory taxation;
currency devaluations and other currency exchange rate fluctuations; greater
social, economic

-11-

and political uncertainty and instability (including the risk of war); more
substantial government involvement in the economy; less government supervision
and regulation of the securities markets and participants in those markets;
controls on foreign investment and limitations on repatriation of invested
capital and on the Fund's ability to exchange local currencies for U.S. dollars;
unavailability of currency hedging techniques in certain emerging market
countries; the fact that companies in emerging market countries may be smaller,
less seasoned and newly organized companies; the difference in, or lack of,
auditing and financial reporting standards, which may result in unavailability
of material information about issuers; the risk that it may be more difficult to
obtain and/or enforce a judgment in a court outside the United States; and
greater price volatility, substantially less liquidity, and significantly
smaller market capitalization of securities markets. Also, any change in the
leadership or politics of emerging market countries, or the countries that
exercise a significant influence over those countries, may halt the expansion of
or reverse the liberalization of foreign investment policies now occurring and
adversely affect existing investment opportunities.

In addition, a number of emerging market countries restrict, to
various degrees, foreign investment in securities. Furthermore, high rates of
inflation and rapid fluctuations in inflation rates have had, and may continue
to have, negative effects on the economies and securities markets of certain
emerging market countries.

FOREIGN CURRENCY TRANSACTIONS. The Fund may engage in currency
exchange transactions to protect against uncertainty in the level of future
foreign currency exchange rates and to increase current return. The Fund may
engage in both "transaction hedging" and "position hedging".

When it engages in transaction hedging, the Fund enters into foreign
currency transactions with respect to specific receivables or payables of the
Fund generally arising in connection with the purchase or sale of its portfolio
securities. The Fund will engage in transaction hedging when it desires to "lock
in" the U.S. dollar price of a security it has agreed to purchase or sell, or
the U.S. dollar equivalent of a dividend or interest payment in a foreign
currency. By transaction hedging, the Fund will attempt to protect against a
possible loss resulting from an adverse change in the relationship between the
U.S. dollar and the applicable foreign currency during the period between the
date on which the security is purchased or sold or on which the dividend or
interest payment is declared, and the date on which such payments are made or
received.

The Fund may purchase or sell a foreign currency on a spot (or cash)
basis at the prevailing spot rate in connection with transaction hedging. The
Fund may also enter into contracts to purchase or sell foreign currencies at a
future date ("forward contracts") and purchase and sell foreign currency futures
contracts.

For transaction hedging purposes, the Fund may also purchase
exchange-listed and over-the-counter call and put options on foreign currency
futures contracts and on foreign currencies. A put option on a futures contract
gives the Fund the right to assume a short position in the futures contract
until expiration of the option. A put option on currency gives the Fund the
right to sell a currency at an exercise price until the expiration of the
option. A call option on a futures contract gives the Fund the right to assume a
long position in the futures contract until the expiration of the option. A call
option on currency gives the Fund the right to purchase a currency at the
exercise price until the expiration of the option. The Fund will engage in
over-the-counter transactions only when appropriate exchange-traded transactions
are unavailable and when, in Schroders' opinion, the pricing mechanism and
liquidity are satisfactory and the participants are responsible parties likely
to meet their contractual obligations.

-12-

When it engages in position hedging, the Fund enters into foreign
currency exchange transactions to protect against a decline in the values of the
foreign currencies in which securities held by the Fund are denominated or are
quoted in their principal trading markets or an increase in the value of
currency for securities which the Fund expects to purchase. In connection with
position hedging, the Fund may purchase put or call options on foreign currency
and foreign currency futures contracts and buy or sell forward contracts and
foreign currency futures contracts. The Fund may also purchase or sell foreign
currency on a spot basis.

The precise matching of the amounts of foreign currency exchange
transactions and the value of the portfolio securities involved will not
generally be possible since the future value of such securities in foreign
currencies will change as a consequence of market movements in the values of
those securities between the dates the currency exchange transactions are
entered into and the dates they mature.

It is impossible to forecast with precision the market value of the
Fund's portfolio securities at the expiration or maturity of a forward or
futures contract. Accordingly, it may be necessary for the Fund to purchase
additional foreign currency on the spot market (and bear the expense of such
purchase) if the market value of the security or securities being hedged is less
than the amount of foreign currency the Fund is obligated to deliver and if a
decision is made to sell the security or securities and make delivery of the
foreign currency. Conversely, it may be necessary to sell on the spot market
some of the foreign currency received upon the sale of the portfolio security or
securities of the Fund if the market value of such security or securities
exceeds the amount of foreign currency the Fund is obligated to deliver.

To offset some of the costs to the Fund of hedging against
fluctuations in currency exchange rates, the Fund may write covered call options
on those currencies.

Transaction and position hedging do not eliminate fluctuations in the
underlying prices of the securities which the Fund owns or intends to purchase
or sell. They simply establish a rate of exchange which one can achieve at some
future point in time. Additionally, although these techniques tend to minimize
the risk of loss due to a decline in the value of the hedged currency, they tend
to limit any potential gain which might result from the increase in the value of
such currency. Also, suitable foreign currency hedging transactions may not be
available in all circumstances and there can be no assurance that the Fund will
utilize hedging transactions at any time or from time to time.

The Fund may also seek to increase its current return by purchasing
and selling foreign currency on a spot basis, and by purchasing and selling
options on foreign currencies and on foreign currency futures contracts, and by
purchasing and selling foreign currency forward contracts.

Currency Forward and Futures Contracts. A forward foreign currency exchange
contract involves an obligation to purchase or sell a specific currency at a
future date, which may be any fixed number of days from the date of the contract
as agreed by the parties, at a price set at the time of the contract. In the
case of a cancelable forward contract, the holder has the unilateral right to
cancel the contract at maturity by paying a specified fee. The contracts are
traded in the interbank market conducted directly between currency traders
(usually large commercial banks) and their customers. A forward contract
generally has no deposit requirement, and no commissions are charged at any
stage for trades. A foreign currency futures contract is a standardized contract
for the future delivery of a specified amount of a foreign currency at a future
date at a price set at the time of the contract. Foreign currency futures
contracts traded in the United States are designed by and traded on exchanges
regulated by the CFTC, such as the New York Mercantile Exchange.

-13-

Forward foreign currency exchange contracts differ from foreign
currency futures contracts in certain respects. For example, the maturity date
of a forward contract may be any fixed number of days from the date of the
contract agreed upon by the parties, rather than a predetermined date in a given
month. Forward contracts may be in any amounts agreed upon by the parties rather
than predetermined amounts. Also, forward foreign exchange contracts are traded
directly between currency traders so that no intermediary is required. A forward
contract generally requires no margin or other deposit.

At the maturity of a forward or futures contract, the Fund may either
accept or make delivery of the currency specified in the contract, or at or
prior to maturity enter into a closing transaction involving the purchase or
sale of an offsetting contract. Closing transactions with respect to forward
contracts are usually effected with the currency trader who is a party to the
original forward contract. Closing transactions with respect to futures
contracts are effected on a commodities exchange; a clearing corporation
associated with the exchange assumes responsibility for closing out such
contracts.

Positions in foreign currency futures contracts and related options
may be closed out only on an exchange or board of trade which provides a
secondary market in such contracts or options. Although the Fund will normally
purchase or sell foreign currency futures contracts and related options only on
exchanges or boards of trade where there appears to be an active secondary
market, there is no assurance that a secondary market on an exchange or board of
trade will exist for any particular contract or option or at any particular
time. In such event, it may not be possible to close a futures or related option
position and, in the event of adverse price movements, the Fund would continue
to be required to make daily cash payments of variation margin on its futures
positions.

Foreign Currency Options. Options on foreign currencies operate similarly to
options on securities, and are traded primarily in the over-the-counter market,
although options on foreign currencies have been listed on several exchanges.
Such options will be purchased or written only when Schroders believes that a
liquid secondary market exists for such options. There can be no assurance that
a liquid secondary market will exist for a particular option at any specific
time. Options on foreign currencies are affected by all of those factors which
influence exchange rates and investments generally.

The value of a foreign currency option is dependent upon the value of
the foreign currency and the U.S. dollar, and may have no relationship to the
investment merits of a foreign security. Because foreign currency transactions
occurring in the interbank market involve substantially larger amounts than
those that may be involved in the use of foreign currency options, investors may
be disadvantaged by having to deal in an odd lot market (generally consisting of
transactions of less than $1 million) for the underlying foreign currencies at
prices that are less favorable than for round lots.

There is no systematic reporting of last sale information for foreign
currencies and there is no regulatory requirement that quotations available
through dealers or other market sources be firm or revised on a timely basis.
Available quotation information is generally representative of very large
transactions in the interbank market and thus may not reflect relatively smaller
transactions (less than $1 million) where rates may be less favorable. The
interbank market in foreign currencies is a global, around-the-clock market. To
the extent that the U.S. options markets are closed while the markets for the
underlying currencies remain open, significant price and rate movements may take
place in the underlying markets that cannot be reflected in the U.S. options
markets.

Foreign Currency Conversion. Although foreign exchange dealers do not charge a
fee for currency conversion, they do realize a profit based on the difference
(the "spread") between prices at which they

-14-

buy and sell various currencies. Thus, a dealer may offer to sell a foreign
currency to the Fund at one rate, while offering a lesser rate of exchange
should the Fund desire to resell that currency to the dealer.

CONVERTIBLE SECURITIES. The Fund may invest in convertible securities,
which are corporate debt securities that may be converted at either a stated
price or stated rate into underlying shares of commons stock. Convertible
securities have general characteristics similar both to debt securities and
equity securities. The market value of convertible securities tends to decline
as interest rates increase and, conversely, tends to increase as interest rates
decline. In addition, because of the conversion feature, the market value of
convertible securities tends to vary with fluctuations in the market value of
the underlying common stocks and, therefore, also will react to variations in
the general market for equity securities. Convertible securities provide for
streams of income with yields that are generally higher than those of common
stocks.

WARRANTS TO PURCHASE SECURITIES. The Fund may invest in warrants to
purchase securities. Bonds issued with warrants attached to purchase equity
securities have many characteristics of convertible bonds and their prices may,
to some degree, reflect the performance of the underlying stock. Bonds also may
be issued with warrants attached to purchase additional fixed income securities
at the same coupon rate. A decline in interest rates would permit the Fund to
buy additional bonds at the favorable rate or to sell the warrants at a profit.
If interest rates rise, the warrants would generally expire with no value.

The Fund may also invest in equity-linked warrants. The Fund purchases
the equity-linked warrants from a broker, who in turn is expected to purchase
shares in the local market and issue a call warrant hedged on the underlying
holding. If the Fund exercises its call and closes its position, the shares are
expected to be sold and the warrant redeemed with the proceeds. Each warrant
represents one share of the underlying stock. Therefore, the price, performance
and liquidity of the warrant are all directly linked to the underlying stock,
less transaction costs. Equity-linked warrants are valued at the closing price
of the underlying security, then adjusted for stock dividends declared by the
underlying security. In addition to the market risk related to the underlying
holdings, the Fund bears additional counterparty risk with respect to the
issuing broker. Moreover, there is currently no active trading market for
equity-linked warrants.

REAL ESTATE INVESTMENT TRUSTS. The Fund may invest in real estate
investment trusts ("REITs"). Equity REITs invest directly in real property while
mortgage REITs invest in mortgages on real property. REITs may be subject to
certain risks associated with the direct ownership of real estate, including
declines in the value of real estate, risks related to general and local
economic conditions, overbuilding and increased competition, increases in
property taxes and operating expenses, and variations in rental income.
Generally, increases in interest rates will decrease the value of high yielding
securities and increase the costs of obtaining financing, which could decrease
the value of a REIT's investments. In addition, equity REITs may be affected by
changes in the value of the underlying property owned by the REITs, while
mortgage REITs may be affected by the quality of credit extended. Equity and
mortgage REITs are dependent upon management skill, are not diversified and are
subject to the risks of financing projects. REITs are also subject to heavy cash
flow dependency, defaults by borrowers, self liquidation and the possibility of
failing to qualify for tax-free pass-through of income under the Code, and to
maintain exemption from registration under the 1940 Act.

INVESTMENTS IN POOLED VEHICLES. The Fund may invest in shares of both
open- and closed-end investment companies (including single country funds and
exchange-traded funds ("ETFs")), and trusts.

-15-

The Fund also may invest in other private investment funds, vehicles, or
structures. Investing in another pooled vehicle exposes the Fund to all the
risks of that pooled vehicle, and, in general, subjects it to a pro rata portion
of the other pooled vehicle's fees and expenses. ETFs are hybrid investment
companies that are registered as open-end investment companies or unit
investment trusts ("UITs") but possess some of the characteristics of closed-end
funds. ETFs typically hold a portfolio of securities that is intended to track
the price and dividend performance of a particular index. Common examples of
ETFs include S&P Depositary Receipts ("SPDRs") and iShares, which may be
purchased from the UIT or investment company issuing the securities or purchased
in the secondary market (SPDRs are listed on the American Stock Exchange and
iShares are listed on the New York Stock Exchange). The market price for ETF
shares may be higher or lower than the ETF's net asset value. The sale and
redemption prices of ETF shares purchased from the issuer are based on the
issuer's net asset value.

NON-PRINCIPAL INVESTMENTS, INVESTMENT PRACTICES AND RISKS

In addition to the principal investment strategies and the principal
risks of the Fund described in the Prospectuses and this SAI, the Fund may
employ other investment practices and may be subject to additional risks, which
are described below.

DEPOSITARY RECEIPTS. The Fund may invest in American Depositary
Receipts ("ADRs"), Global Depository Receipts ("GDRs"), European Depository
Receipts ("EDRs") or other similar securities representing ownership of foreign
securities (collectively, "Depositary Receipts") if issues of these Depositary
Receipts are available that are consistent with the Fund's investment objective.
Depositary Receipts generally evidence an ownership interest in a corresponding
foreign security on deposit with a financial institution. Transactions in
Depositary Receipts usually do not settle in the same currency in which the
underlying securities are denominated or traded. Generally, ADRs, in registered
form, are designed for use in the U.S. securities markets and EDRs, in bearer
form, are designed for use in European securities markets. GDRs may be traded in
any public or private securities markets and may represent securities held by
institutions located anywhere in the world.

Investments in non-U.S. issuers through Depositary Receipts and
similar instruments may involve certain risks not applicable to investing in
U.S. issuers, including changes in currency rates, application of local tax
laws, changes in governmental administration or economic or monetary policy or
changed circumstances in dealings between nations. Costs may be incurred in
connection with conversions between various currencies. The Fund may enter into
forward currency contracts and purchase currencies on a spot basis to reduce
currency risk; however, currency hedging involves costs and may not be effective
in all cases.

SHORT SALES. To the extent permitted under "Investment Restrictions"
below and in the Prospectuses, the Fund may seek to hedge investments or realize
additional gains through short sales.

Short sales are transactions in which the Fund sells a security it
does not own, in anticipation of a decline in the market value of that security.
To complete such a transaction, the Fund must borrow the

-16-

security to make delivery to the buyer. The Fund then is obligated to replace
the security borrowed by purchasing it at the market price at or prior to the
time of replacement. The price at such time may be more or less than the price
at which the security was sold by the Fund. Until the security is replaced, the
Fund is required to repay the lender any dividends or interest that accrue
during the period of the loan. To borrow the security, the Fund also may be
required to pay a premium, which would increase the cost of the security sold.
The net proceeds of the short sale will be retained by the broker (or by the
Fund's custodian in a special custody account), to the extent necessary to meet
margin requirements, until the short position is closed out. The Fund also will
incur transaction costs in effecting short sales.

The Fund will incur a loss as a result of the short sale if the price
of the security increases between the date of the short sale and the date on
which the Fund replaces the borrowed security. The Fund may realize a gain if
the security declines in price between those dates. The amount of any gain will
be decreased, and the amount of any loss increased, by the amount of the
premium, dividends, interest or expenses the Fund may be required to pay in
connection with a short sale. The Fund's loss on a short sale could
theoretically be unlimited in a case where the Fund is unable, for whatever
reason, to close out its short position. There can be no assurance that the Fund
will be able to close out a short position at any particular time or at an
acceptable price. In addition, short positions may result in a loss if a
portfolio strategy of which the short position is a part is otherwise
unsuccessful.

At any time that the Fund has sold a security short, it will maintain
liquid securities, in a segregated account with its custodian, in an amount
that, when combined with the amount of collateral deposited with the broker in
connection with the short sale, equals the value at the time of securities sold
short.

FORWARD COMMITMENTS. The Fund may enter into contracts to purchase
securities for a fixed price at a future date beyond customary settlement time
("forward commitments") if the Fund holds, and maintains until the settlement
date in a segregated account, cash or liquid securities in an amount sufficient
to meet the purchase price, or if the Fund enters into offsetting contracts for
the forward sale of other securities it owns. Forward commitments may be
considered securities in themselves, and involve a risk of loss if the value of
the security to be purchased declines prior to the settlement date, which risk
is in addition to the risk of decline in the value of the Fund's other assets.
Where such purchases are made through dealers, the Fund relies on the dealer to
consummate the sale. The dealer's failure to do so may result in the loss to the
Fund of an advantageous yield or price.

Although the Fund will generally enter into forward commitments with
the intention of acquiring securities for its portfolio or for delivery pursuant
to options contracts it has entered into, the Fund may dispose of a commitment
prior to settlement if Schroders deems it appropriate to do so. The Fund may
realize short-term profits or losses upon the sale of forward commitments.

LOANS OF FUND PORTFOLIO SECURITIES. The Fund may lend its portfolio
securities, provided: (1) the loan is secured continuously by collateral
consisting of U.S. Government securities, cash, or cash equivalents adjusted
daily to have market value at least equal to the current market value of the
securities loaned; (2) the Fund may at any time call the loan and regain the
securities loaned; (3) the Fund will receive any interest or dividends paid on
the loaned securities; and (4) the aggregate market value of the Fund's
portfolio securities loaned will not at any time exceed one-third of the total
assets of the Fund. While the Fund may loan portfolio securities with an
aggregate market value of up to one third of the Fund's total assets at any
time, entering into securities loans is not a principal strategy of the Fund and
the risks arising from lending portfolio securities are not principal risks of
investing in the Fund. In addition,

-17-

it is anticipated that the Fund may share with the borrower some of the income
received on the collateral for the loan or that it will be paid a premium for
the loan. Before the Fund enters into a loan, Schroders considers all relevant
facts and circumstances, including the creditworthiness of the borrower. The
risks in lending portfolio securities, as with other extensions of credit,
consist of possible delay in recovery of the securities or possible loss of
rights in the collateral should the borrower fail financially. Although voting
rights or rights to consent with respect to the loaned securities pass to the
borrower, the Fund retains the right to call the loans at any time on reasonable
notice, and it will do so in order that the securities may be voted by the Fund
if the holders of such securities are asked to vote upon or consent to matters
materially affecting the investment. The Fund will not lend portfolio securities
to borrowers affiliated with that Fund.

REPURCHASE AGREEMENTS. The Fund may enter into repurchase agreements
without limit. A repurchase agreement is a contract under which the Fund
acquires a security for a relatively short period (usually not more than one
week) subject to the obligation of the seller to repurchase and the Fund to
resell such security at a fixed time and price (representing the Fund's cost
plus interest). It is the Trust's present intention to enter into repurchase
agreements only with member banks of the Federal Reserve System and securities
dealers meeting certain criteria as to creditworthiness and financial condition,
and only with respect to obligations of the U.S. Government or its agencies or
instrumentalities or other high quality short-term debt obligations. Repurchase
agreements may also be viewed as loans made by the Fund which are collateralized
by the securities subject to repurchase. Schroders will monitor such
transactions to ensure that the value of the underlying securities will be at
least equal at all times to the total amount of the repurchase obligation,
including the interest factor. If the seller defaults, the Fund could realize a
loss on the sale of the underlying security to the extent that the proceeds of
sale including accrued interest are less than the resale price provided in the
agreement including interest. In addition, if the seller should be involved in
bankruptcy or insolvency proceedings, the Fund may incur delay and costs in
selling the underlying security or may suffer a loss of principal and interest
if the Fund is treated as an unsecured creditor and required to return the
underlying collateral to the seller's estate.

PRIVATE PLACEMENTS AND RESTRICTED SECURITIES. The Fund may invest in
securities that are purchased in private placements. While such private
placements may often offer attractive opportunities for investment not otherwise
available on the open market, the securities so purchased are often "restricted
securities," i.e., securities which cannot be sold to the public without
registration under the Securities Act of 1933 or the availability of an
exemption from registration (such as Rules 144 or 144A), or which are "not
readily marketable" because they are subject to other legal or contractual
delays in or restrictions on resale. Because there may be relatively few
potential purchasers for such investments, especially under adverse market or
economic conditions or in the event of adverse changes in the financial
condition of the issuer, the Fund could find it more difficult to sell such
securities when Schroders believes it advisable to do so or may be able to sell
such securities only at prices lower than if such securities were more widely
held. At times, it may also be more difficult to determine the fair value of
such securities for purposes of computing the Fund's net asset value.

The absence of a trading market can make it difficult to ascertain a
market value for illiquid investments. Disposing of illiquid investments may
involve time-consuming negotiation and legal expenses, and it may be difficult
or impossible for a Fund to sell them promptly at an acceptable price. The Fund
may have to bear the extra expense of registering such securities for resale and
the risk of substantial delay in effecting such registration. Also, market
quotations are less readily available. The judgment of Schroders may at times
play a greater role in valuing these securities than in the case of publicly
traded securities.

-18-

Generally speaking, restricted securities may be sold only to
qualified institutional buyers, or in a privately negotiated transaction to a
limited number of purchasers, or in limited quantities after they have been held
for a specified period of time and other conditions are met pursuant to an
exemption from registration, or in a public offering for which a registration
statement is in effect under the Securities Act of 1933. A Fund may be deemed to
be an "underwriter" for purposes of the Securities Act of 1933 when selling
restricted securities to the public, and in such event the Fund may be liable to
purchasers of such securities if the registration statement prepared by the
issuer, or the prospectus forming a part of it, is materially inaccurate or
misleading. The Staff of SEC currently takes the view that any delegation by the
Trustees of the authority to determine that a restricted security is readily
marketable (as described in the investment restrictions of the Funds) must be
pursuant to written procedures established by the Trustees and the Trustees have
delegated such authority to Schroders. If no qualified institutional buyers are
interested in purchasing the securities, then the Fund may not be able to sell
such securities. In the event that the Trustees, or persons designated by the
Trustees, determine that a security is "readily marketable" pursuant to these
procedures, and the Fund is not able to sell such security at the price that
such persons anticipate, then the Fund's net asset value will decrease.

TEMPORARY DEFENSIVE STRATEGIES. As described in the Prospectuses,
Schroders may at times judge that conditions in the securities markets make
pursuing the Fund's basic investment strategies inconsistent with the best
interests of its shareholders and may temporarily use alternate investment
strategies primarily designed to reduce fluctuations in the value of the Fund's
assets. In implementing these "defensive" strategies, the Fund would invest in
investment grade debt securities, cash, or money market instruments to any
extent Schroders considers consistent with such defensive strategies. It is
impossible to predict when, or for how long, the Fund will use these alternate
strategies. One risk of taking such temporary defensive positions is that the
Fund may not achieve its investment objective.

INVESTMENT RESTRICTIONS

As fundamental investment restrictions, which may only be changed with
approval by the holders of a majority of the outstanding voting securities of
the Fund, the Fund may not:

1. issue any class of securities which is senior to the Fund's shares of
beneficial interest, except to the extent the Fund is permitted to borrow money
or otherwise to the extent consistent with applicable law from time to time.

Note: The Investment Company Act currently prohibits an open-end investment
company from issuing any senior securities, except to the extent it is permitted
to borrow money (see Note following restriction 2, below). A class of securities
may be senior to the Fund's shares of beneficial interest if it provides a
preference upon liquidation, preferential dividends, or similar rights.

2. borrow money, except to the extent permitted by applicable law from time to
time;

Note: The Investment Company Act currently permits an open-end investment
company to borrow money from a bank (including by entering into reverse
repurchase agreements) so long as the ratio which the value of the total assets
of the investment company (including the amount of any such borrowing), less the
amount of all liabilities and indebtedness (other than such borrowing) of the
investment company, bears to the amount of such borrowing is at least 300%.

-19-

3. act as underwriter of securities of other issuers except to the extent that,
in connection with the disposition of portfolio securities, it may be deemed to
be an underwriter under certain federal securities laws;

4. as to 75% of its total assets, purchase any security (other than Government
securities, as such term is defined in the 1940 Act; and securities of other
investment companies), if as a result more than 5% of the Fund's total assets
(taken at current value) would then be invested in securities of a single issuer
or the Fund would hold more than 10% of the outstanding voting securities of
such issuer;

NOTE: Government securities are defined in the 1940 Act as any security issued
or guaranteed as to principal or interest by the United States, or by a person
controlled or supervised by and acting as an instrumentality of the Government
of the United States pursuant to authority granted by the Congress of the United
States, or any certificate of deposit for any of the foregoing.

5. purchase any security (other than Government securities, as such term is
defined in the 1940 Act) if as a result 25% or more of the Fund's total assets
(taken at current value) would be invested in a single industry;

6. make loans, except by purchase of debt obligations or other financial
instruments, by entering into repurchase agreements, or through the lending of
its portfolio securities;

7. purchase or sell commodities or commodity contracts, except that the Fund may
purchase or sell financial futures contracts, options on financial futures
contracts, and futures contracts, forward contracts, and options with respect to
foreign currencies, and may enter into swap transactions or other financial
transactions, and except in connection with otherwise permissible options,
futures, and commodity activities; and

8. purchase or sell real estate or interests in real estate, including real
estate mortgage loans, although the Fund may purchase and sell securities which
are secured by real estate and securities of companies, including limited
partnership interests, that invest or deal in real estate and it may purchase
interests in real estate investment trusts. (For purposes of this restriction,
investments by the Fund in mortgage-backed securities and other securities
representing interests in mortgage pools shall not constitute the purchase or
sale of real estate or interests in real estate or real estate mortgage loans).

----------

It is contrary to the current policy of the Fund, which policy may be
changed without shareholder approval, to invest more than 15% of its net assets
in securities which are not readily marketable, including securities restricted
as to resale (other than securities restricted as to resale but determined by
the Trustees, or persons designated by the Trustees to make such determinations,
to be readily marketable).

As a matter of non-fundamental policy, the Fund may not purchase
securities when outstanding borrowings exceed 5% of the Fund's total assets.

-20-

The Fund may, as a non-fundamental policy, pledge up to one-third of
its assets in connection with permissible borrowings by the Fund. In addition,
as a non-fundamental policy, the Fund will not invest in other companies for the
purpose of exercising control of those companies.

All percentage limitations on investments (except the limitation with
respect to securities that are not readily marketable set forth above) will
apply at the time of investment and shall not be considered violated unless an
excess or deficiency occurs or exists immediately after and as a result of such
investment; except that, if the Fund ceases to maintain the 300% asset coverage
ratio described above in the Note following restriction 2, it will take steps to
restore that asset coverage ratio within three days thereafter (excluding
Sundays and holidays) or such longer period as may be prescribed by applicable
regulations.

Except for the investment restrictions listed above as fundamental or
to the extent designated as such in the Prospectuses, the other investment
policies described in this SAI or in the Prospectuses are not fundamental and
may be changed by approval of the Trustees.

The 1940 Act provides that a "vote of a majority of the outstanding
voting securities" of the Fund means the affirmative vote of the lesser of (1)
more than 50% of the outstanding shares of the Fund, or (2) 67% or more of the
shares present at a meeting if more than 50% of the outstanding shares are
represented at the meeting in person or by proxy.

DISCLOSURE OF PORTFOLIO HOLDINGS

Through filings made with the SEC on Form N-CSR and Form N-Q, the Fund
makes its full portfolio holdings publicly available to shareholders on a
quarterly basis. The Fund normally makes such filings on or shortly after the
sixtieth day following the end of a fiscal quarter. The Fund delivers its
complete portfolio schedules for the second and fourth fiscal quarters, required
to be filed on Form N-CSR, to shareholders in the Fund's semi-annual and annual
reports. The Fund does not deliver its complete portfolio schedules for the
first and third fiscal quarters, required to be filed on Form N-Q, to
shareholders, but these schedules are available on the SEC website at
www.sec.gov.

POLICIES AND PROCEDURES. The Schroder Funds have adopted policies and
procedures with respect to disclosure of the Funds' portfolio holdings. These
procedures apply both to arrangements, expected to be in place over a period of
time, to make available information about the securities in the Fund's portfolio
and with respect to disclosure on a one-time, irregular basis. These procedures
provide that neither Schroders nor SIMNA Ltd., as applicable, nor the Fund
receive any compensation in return for the disclosure of information about the
Fund's portfolio securities or for any ongoing arrangements to make available
information about the Fund's portfolio securities. Portfolio holdings may be
disclosed to certain third parties in advance of quarterly filings by the Fund
with the SEC. In each instance of such advance disclosure, a determination will
have been made by Schroders or SIMNA Ltd., as applicable, that such disclosure
is supported by a legitimate business purpose of the Fund and that the
recipients, except as described below, are subject to an independent duty not to
disclose (whether contractually or as a matter of law) or trade on the nonpublic
information. The Fund currently discloses nonpublic portfolio holdings
information only to recipients who have agreed in writing with Schroders, or
SIMNA Ltd., as applicable, to keep such information confidential. In some cases
these recipients are subject to a contractual obligation to keep portfolio
holdings information confidential, and in other cases they are subject to a
contractual obligation to keep information disclosed to them by the Fund
confidential. Recipients of nonpublic portfolio holdings information are also
subject to legal requirements prohibiting

-21-

them from trading on material nonpublic information. In the future, where
Schroders or SIMNA Ltd., as applicable, does not believe that the risk of
disclosure is material, the Fund may disclose information to recipients who do
not have an independent duty not to disclose the nonpublic information and are
not party to a confidentiality agreement. Any inappropriate use of such
information by the recipient could be harmful to the Fund and its shareholders.
The Fund has no ongoing arrangements to make available nonpublic portfolio
holdings information, except as described in the procedures below. Nonpublic
portfolio holdings information is disclosed by the Fund's portfolio management
team, except in cases where the information is disclosed by other personnel or
agents of the Fund, as described below. The following list describes the
circumstances in which the Fund discloses its portfolio holdings to select third
parties:

Portfolio Managers. Portfolio managers shall have full daily access to portfolio
holdings for the Funds for which they have direct management responsibility.
Under Schroders' code of ethics, portfolio managers are prohibited from
disclosing nonpublic information to third parties. Portfolio managers may
release and discuss specific portfolio holdings with various broker-dealers, on
an as-needed basis, for purposes of analyzing the impact of existing and future
market changes on the prices, availability or demand, and liquidity of such
securities, as well as for the purpose of assisting portfolio managers in the
trading of such securities.

Schroders. In its capacity as adviser to the Fund, certain Schroders personnel
and personnel of its affiliates, SIMNA Ltd. and Schroder Investment Management
Limited, that deal directly with the processing, settlement, review, control,
auditing, reporting, or valuation of portfolio trades will have full daily
access to Fund portfolio holdings. Employees of SIMNA Ltd. and Schroder
Investment Management Limited with access to portfolio holdings information are
provided with training on the Trust's policies and procedures regarding
disclosure of portfolio holdings information. Training is provided by the
Schroders compliance department in the applicable jurisdiction, after
consultation with Schroders plc's global compliance department located in
London. The Trust's Chief Compliance Officer reports to the Trustees regarding
compliance by such affiliates.

External Servicing Agents. Appropriate personnel employed by entities that
assist in the review and/or processing of Fund portfolio transactions, which
include fund accounting agents, pricing services, and the custodian have daily
access to all Fund portfolio holdings. Portfolio holdings information is
provided on an ongoing basis to the Fund's sub-administrator SEI Investments
Global Funds Services ("SEI"). PricewaterhouseCoopers LLP, the Fund's
independent registered public accounting firm, receives portfolio holdings
information yearly in connection with the Fund's audit. Schroders utilizes the
services of Institutional Shareholder Services ("ISS") to assist with proxy
voting. ISS receives full Fund portfolio holdings on a monthly basis for the
funds for which it provides services.

Ranking/Rating Agencies. Morningstar, Lipper, Thomson and Bloomberg receive the
Fund's full portfolio holdings no earlier than 60 calendar days following the
end of each calendar quarter.

Certain approved recipients of portfolio holdings information are
listed in the policies and procedures with respect to the disclosure of the
Fund's portfolio holdings approved by the Board of Trustees of the Trust. Any
addition to the list of approved recipients of portfolio holdings information
included in such procedures (whether on an ongoing or a one-time basis) requires
approval by the President and Chief Compliance Officer of the Fund based on a
review of: (i) the type of Fund involved; (ii) the purpose for receiving the
holdings information; (iii) the intended use of the information; (iv) the
frequency of the information to be provided; (v) the length of the period, if
any, between the date of the

-22-

information and the date on which the information will be disclosed; (vi) the
proposed recipient's relationship to the Fund; (vii) the ability of Schroders to
monitor that such information will be used by the proposed recipient in
accordance with the stated purpose for the disclosure; (viii) whether a
confidentiality agreement will be in place with such proposed recipient; and
(ix) whether any potential conflicts exist regarding such disclosure between the
interests of the Fund shareholders, on the one hand, and those of the Fund's
investment adviser, principal underwriter, or any affiliated person of the Fund.

In general, the Schroder Funds policies and procedures provide that
disclosure by Schroders of information about the holdings of client accounts
other than the Fund's accounts is governed by the policies relating to
protection of client information pursuant to Regulation S-P. Details about the
holdings of any portfolio other than the Fund, however, may provide holdings
information that is substantially identical to holdings of the Fund that have
not yet been publicly released. To the extent that disclosure of non-Fund
portfolios to persons other than those enumerated in the Schroder Funds policies
and procedures would provide information substantially identical to the Fund's
portfolio, that disclosure is subject to the Schroder Funds policies and
procedures.

Nothing in the Schroder Funds policies and procedures prohibits any
investment group from providing to a research service provider a coverage list
that identifies securities that the investment group follows for research
purposes provided that: (i) the list of securities does not consist exclusively
of the current portfolio holdings of the Fund; and (ii) no information about
actual holdings by any account is included.

The Board of Trustees reviews and reapproves the policies and procedures related
to portfolio disclosure, including the list of approved recipients, as often as
deemed appropriate, but not less than annually, and may make any changes it
deems appropriate.

MANAGEMENT OF THE TRUST

The Trustees of the Trust are responsible for the general oversight of the
Trust's business. Subject to such policies as the Trustees may determine,
Schroders furnishes a continuing investment program for the Funds and makes
investment decisions on their behalf, except that SIMNA Ltd., an affiliate of
Schroders, serves as sub-adviser responsible for portfolio management for the
Fund. Subject to the control of the Trustees, Schroders also manages the Fund's
other affairs and business.

The names, addresses and ages of the Trustees and executive officers of the
Trust, together with information as to their principal business occupations
during the past five years, are set forth in the following tables. Unless
otherwise indicated, each Trustee and executive officer shall hold the indicated
positions until his or her resignation or removal.

DISINTERESTED TRUSTEES

The following table sets forth certain information concerning Trustees who are
not "interested persons" (as defined in the Investment Company Act) of the Trust
(each, a "Disinterested Trustee").

-23-

NUMBER OF
TERM OF PRINCIPAL PORTFOLIOS IN
POSITION(S) OFFICE AND OCCUPATION(S) FUND COMPLEX OTHER DIRECTORSHIPS
NAME, AGE AND ADDRESS OF HELD WITH LENGTH OF DURING PAST 5 OVERSEEN BY OUTSIDE OF SCHRODERS
DISINTERESTED TRUSTEE TRUST TIME SERVED YEARS TRUSTEE FUND COMPLEX
--------------------------------------------------------------------------------------------------------------------

David N. Dinkins, 79 Trustee Indefinite Trustee of the Trust 10 None
875 Third Avenue, 22nd Fl. Since 1994 and Schroder Capital
New York, NY 10022 Funds (Delaware);
Professor, Columbia
School of
International and
Public Affairs.

Peter E. Guernsey, 85 Trustee Indefinite Trustee of the Trust 10 None
875 Third Avenue, 22nd Fl. Since 1997 and Schroder Capital
New York, NY 10022 Funds (Delaware).
Retired. Formerly,
Senior Vice
President, Marsh &
McLennan, Inc.
(insurance
services).

John I. Howell, 89 Trustee Indefinite Trustee and Lead 11 American Life
875 Third Avenue, 22nd Fl. Since 1996 Disinterested Assurance Co. of New
New York, NY 10022 Trustee of the York; United States
Trust, Schroder Life Insurance Co.
Capital Funds of the City of New
(Delaware) and York; First
Schroder Global SunAmerica Life
Series Trust; Insurance Co.
Private Consultant,
Indian Rock
Corporation
(individual
accounting).

Peter S. Knight, 55 Trustee Indefinite Trustee of the 11 Medicis; PAR
875 Third Avenue, 22nd Fl. Since 1997 Trust, Schroder Pharmaceuticals; and
New York, NY 10022 Capital Funds Entremed
(Delaware) and
Schroder Global
Series Trust;
Director, Schroder
Japanese Long/Short
Fund; Director,
Schroder Credit
Renaissance Fund,
LP; Director,
Schroder Alternative
Strategies Fund;
President,
Generation
Investment
Management U.S.
Formerly, Managing
Director, MetWest
Financial (financial
services);
President, Sage
Venture Partners
(investing); and
Partner, Wunder,
Knight, Forcsey &
DeVierno (law firm).

William L. Means, 70 Trustee Indefinite Trustee of the Trust 10 None
875 Third Avenue, 22nd Fl. Since 1997 and Schroder Capital
New York, NY 10022 Funds (Delaware).
Retired.

Clarence F. Michalis, 84 Trustee Indefinite Trustee of the 11 None
875 Third Avenue, 22nd Fl. Since 1997 Trust, Schroder
New York, NY 10022 Capital Funds
(Delaware) and

-24-

Schroder Global
Series Trust.
Retired. Formerly,
Chairman of the
Board of Directors,
Josiah Macy, Jr.,
Foundation.

Hermann C. Schwab, 86 Trustee Indefinite Trustee of the Trust 10 None
875 Third Avenue, 22nd Fl. Since 1997 and Schroder Capital
New York, NY 10022 Funds (Delaware).
Retired.

James D. Vaughn, 61 Trustee Indefinite Trustee and Chairman 11 AMG National Trust
875 Third Avenue, 22nd Fl. Since 2003 of the Audit Bank
New York, New York 10022 Committee of the
Trust, Schroder
Capital Funds
(Delaware) and
Schroder Global
Series Trust.
Retired. Formerly,
Managing Partner,
Deloitte & Touche
USA, LLP-Denver.

INTERESTED TRUSTEE

The following table sets forth certain information concerning a Trustee who is
an "interested person" (as defined in the Investment Company Act) of the Trust
(an "Interested Trustee").

NUMBER OF
TERM OF PRINCIPAL PORTFOLIOS IN
POSITION(S) OFFICE AND OCCUPATION(S) FUND COMPLEX OTHER DIRECTORSHIPS
NAME, AGE AND ADDRESS OF HELD WITH LENGTH OF DURING PAST 5 OVERSEEN BY OUTSIDE OF SCHRODERS
INTERESTED TRUSTEE TRUST TIME SERVED YEARS TRUSTEE FUND COMPLEX
--------------------------------------------------------------------------------------------------------------------

Peter L. Clark, 42* Trustee and Indefinite Trustee and Chairman 10 None
875 Third Avenue, 22nd Fl. Chairman Since 2003 of the Trust and
New York, NY 10022 Schroder Capital
Funds (Delaware);
Chief Executive
Officer, Schroders.
Formerly, Managing
Director and Head of
Emerging Markets, JP
Morgan/JP Morgan
Investment
Management; Vice
President and Head
of Proprietary
Trading, JP Morgan.

* Mr. Clark is an Interested Trustee due to his status as an officer and
employee of Schroder Investment Management North America Inc. and its
affiliates.

OFFICERS

The following table sets forth certain information concerning the Trust's
officers. The officers of the Trust are employees of organizations that provide
services to the Fund.

-25-

NAME, AGE AND ADDRESS POSITION(S) HELD WITH TERM OF OFFICE PRINCIPAL OCCUPATION(S)
OF OFFICER TRUST AND LENGTH OF TIME SERVED DURING PAST 5 YEARS
--------------------------------------------------------------------------------------------------------------------

Peter L. Clark, 42 Trustee and Chairman Indefinite Trustee and Chairman of the Trust
875 Third Avenue, 22nd Fl. Since 2003 and Schroder Capital Funds
New York, NY 10022 (Delaware); Director and Chief
Executive Officer, Schroders.
Formerly, Managing Director and
Head of Emerging Markets, JP
Morgan/JP Morgan Investment
Management; Vice President and
Head of Proprietary Trading, JP
Morgan.

Mark A. Hemenetz, 50 President and Indefinite Chief Operating Officer, Director
875 Third Avenue, 22nd Fl. Principal Executive Since May 2004 and Executive Vice President,
New York, NY 10022 Officer Schroders; Chairman and Director,
Schroder Fund Advisors Inc.;
President and Principal Executive
Officer, the Trust, Schroder
Capital Funds (Delaware) and
Schroder Global Series Trust.
Formerly, Executive Vice President
and Director of Investment
Management, Bank of New York.

Alan M. Mandel, 48 Treasurer and Chief Indefinite First Vice President, Schroders;
875 Third Avenue, 22nd Fl. Financial Officer Since May 2003 Chief Operating Officer, Treasurer
New York, NY 10022 and Director, Schroder Fund
Advisors Inc.; Treasurer and Chief
Financial Officer, the Trust,
Schroder Global Series Trust and
Schroder Capital Funds (Delaware).

Carin F. Muhlbaum, 44 Vice President and Indefinite Senior Vice President, General
875 Third Avenue, 22nd Fl. Clerk Vice President since 1998; Counsel, and Chief Administrative
New York, NY 10022 Clerk since 2001 Officer, Schroders; Director,
Senior Vice President, Secretary
and General Counsel, Schroder Fund
Advisors Inc.; Vice President and
Secretary/Clerk, the Trust,
Schroder Global Series Trust and
Schroder Capital Funds (Delaware).

Stephen M. DeTore, 54 Chief Compliance Indefinite Senior Vice President, Director
875 Third Avenue, 22nd Fl. Officer Since 2005 and Chief Compliance Officer,
New York, NY 10022 Schroders; Senior Vice President
and Director, Schroder Fund
Advisors Inc.; Chief Compliance
Officer, the Trust, Schroder
Capital Funds (Delaware) and
Schroder Global Series Trust.
Formerly, Deputy General Counsel,
Gabelli Asset Management Inc.;
Associate General Counsel, Gabelli
Asset Management, Inc.; Assistant
Director, Office of Examination
Support, U.S. Securities and
Exchange Commission.

Angel Lanier, 43 Assistant Secretary Indefinite Assistant Vice President,
875 Third Avenue, 22nd Fl. Since 2005 Schroders; Assistant Vice
New York, NY 10022 President, Schroder Fund Advisors
Inc.; Assistant Secretary of the
Trust, Schroder Capital Funds
(Delaware) and Schroder Global
Series Trust. Formerly, Associate,
Schroders.

CERTAIN AFFILIATIONS

The following table lists the positions held by the Trust's officers and any
Interested Trustees with affiliated persons or principal underwriters of the
Trust:

-26-

POSITIONS HELD WITH
AFFILIATED PERSONS OR
PRINCIPAL UNDERWRITERS
NAME OF THE TRUST
------------------------------------------------------------------------
Peter L. Clark Trustee and Chairman of the Trust and Schroder
Capital Funds (Delaware); Director and Chief
Executive Officer, Schroders. Formerly, Managing
Director and Head of Emerging Markets, JP Morgan/JP
Morgan Investment Management; Vice President and
Head of Proprietary Trading, JP Morgan.

Mark A. Hemenetz President of the Trust; President of
Schroder Capital Funds (Delaware) and Schroder
Global Series Trust; Chief Operating Officer,
Director and Executive Vice President, Schroders;
Chairman and Director, Schroder Fund Advisors Inc.

Alan M. Mandel First Vice President, Schroders; Chief Operating
Officer, Treasurer and Director, Schroder Fund
Advisors Inc.; Treasurer and Chief Financial
Officer, the Trust, Schroder Global Series Trust,
Schroder Capital Funds (Delaware).

Carin F. Muhlbaum Senior Vice President, General Counsel, and Chief
Administrative Officer, Schroders; Director, Senior
Vice President, Secretary and General Counsel,
Schroder Fund Advisors Inc.; Vice President and
Secretary/Clerk, the Trust, Schroder Global Series
Trust, and Schroder Capital Funds (Delaware).

Stephen M. DeTore Senior Vice President, Director and Chief Compliance
Officer, Schroders; Senior Vice President and
Director, Schroder Fund Advisors Inc.; Chief
Compliance Officer, the Trust, Schroder Global
Series Trust, and Schroder Capital Funds (Delaware).

Angel Lanier Assistant Vice President, Schroders; Assistant Vice
President, Schroder Fund Advisors Inc.; Assistant
Secretary, the Trust, Schroder Global Series Trust,
and Schroder Capital Funds (Delaware).

COMMITTEES OF THE BOARD OF TRUSTEES

Audit Committee. The Board of Trustees has an Audit Committee composed of all of
the Disinterested Trustees (Messrs. Dinkins, Guernsey, Howell, Knight, Means,
Michalis, Schwab and Vaughn). The Audit Committee provides oversight with
respect to the internal and external accounting and auditing procedures of the
Funds and, among other things, considers the selection of independent public
accountants for the Funds and the scope of the audit, approves all audit and
permitted non-audit services proposed to be performed by those accountants on
behalf of the Funds, and considers other services provided by those accountants
to the Funds and Schroders and their affiliates and the possible effect of those
services on the independence of those accountants. The Audit Committee met four
times during the fiscal year ended October 31, 2005.

Nominating Committee. All of the Disinterested Trustees (Messrs. Dinkins,
Guernsey, Howell, Knight, Means, Michalis, Schwab and Vaughn) serve as a
Nominating Committee of the Board responsible for reviewing and recommending
qualified candidates to the Board in the event that a position is vacated or
created. The Nominating Committee will consider nominees recommended by
shareholders if the Committee is considering other nominees at the time of the
nomination and the nominee meets the Committee's criteria. Nominee
recommendations may be submitted to the Clerk of the Trust at the Trust's
principal business address. The Nominating Committee did not meet during the
fiscal year ended October 31, 2005.

-27-

SECURITIES OWNERSHIP

For each Trustee, the following table discloses the dollar range of equity
securities beneficially owned by the Trustee, on an aggregate basis, in any
registered investment companies overseen by the Trustee within the Schroder
family of investment companies, as of December 31, 2005.

AGGREGATE DOLLAR RANGE
OF EQUITY SECURITIES IN
ALL REGISTERED
INVESTMENT COMPANIES
OVERSEEN BY TRUSTEE IN
DOLLAR RANGE OF EQUITY FAMILY OF INVESTMENT
NAME OF TRUSTEE FUND SECURITIES IN THE FUND COMPANIES*
---------------------- ------------------------- ---------------------- -----------------------

Ranges: Ranges:
None None
$1-$10,000 $1-$10,000
$10,001-$50,000 $10,001-$50,000
$50,001-$100,000 $50,001-$100,000
Over $100,000 Over $100,000

DISINTERESTED TRUSTEES
DAVID N. DINKINS $10,001-$50,000

INTERNATIONAL DIVERSIFIED None
VALUE FUND

PETER E. GUERNSEY None
INTERNATIONAL DIVERSIFIED None
VALUE FUND

JOHN I. HOWELL $10,001-$50,000
INTERNATIONAL DIVERSIFIED None
VALUE FUND

PETER S. KNIGHT None
INTERNATIONAL DIVERSIFIED None
VALUE FUND

WILLIAM L. MEANS $1-10,000
INTERNATIONAL DIVERSIFIED None
VALUE FUND

CLARENCE F. MICHALIS Over $100,000
INTERNATIONAL DIVERSIFIED None
VALUE FUND

HERMANN C. SCHWAB None
INTERNATIONAL DIVERSIFIED None
VALUE FUND

-28-

JAMES D. VAUGHN Over $100,000
INTERNATIONAL DIVERSIFIED None
VALUE FUND

INTERESTED TRUSTEES
PETER L. CLARK $10,001-$50,000
INTERNATIONAL DIVERSIFIED None
VALUE FUND

* For these purposes, the Trust, Schroder Capital Funds (Delaware), and
Schroder Global Series Trust are considered part of the same "Family of
Investment Companies."

For Disinterested Trustees and their immediate family members, the following
table provides information regarding each class of securities owned beneficially
in an investment adviser or principal underwriter of the Trust, or a person
(other than a registered investment company) directly or indirectly controlling,
controlled by, or under common control with an investment adviser or principal
underwriter of the Trust, as of December 31, 2005:

NAME OF
OWNERS AND
RELATIONSHIPS VALUE OF
NAME OF TRUSTEE TO TRUSTEE COMPANY TITLE OF CLASS SECURITIES PERCENT OF CLASS
-------------------- -------------- ------- -------------- ---------- ----------------

David N. Dinkins N/A N/A N/A N/A N/A
Peter E. Guernsey N/A N/A N/A N/A N/A
John I. Howell N/A N/A N/A N/A N/A
Peter S. Knight N/A N/A N/A N/A N/A
William L. Means N/A N/A N/A N/A N/A
Clarence F. Michalis N/A N/A N/A N/A N/A
Hermann C. Schwab N/A N/A N/A N/A N/A
James D. Vaughn N/A N/A N/A N/A N/A

TRUSTEES' COMPENSATION

Trustees who are not employees of Schroders or its affiliates receive an annual
retainer of $11,000 for their services as Trustees of all open-end investment
companies distributed by Schroder Fund Advisors Inc., and $1,250 per meeting
attended in person or $500 per meeting attended by telephone. Members of an
Audit Committee for one or more of such investment companies receive an
additional $1,000 per year. Payment of the annual retainer is allocated among
such investment companies based on their relative net assets. Payments of
meeting fees are allocated only among those investment companies to which the
meeting relates.

The following table sets forth approximate information regarding compensation
received by Trustees from the "Fund Complex" for the fiscal year ended October
31, 2005. (Interested Trustees who are employees of Schroders or its affiliates
and officers of the Trust receive no compensation from the Trust and are
compensated in their capacities as employees of Schroders and its affiliates).

-29-

AGGREGATE TOTAL COMPENSATION FROM
COMPENSATION TRUST AND FUND COMPLEX
NAME OF TRUSTEE FROM TRUST PAID TO TRUSTEES*
-------------------- ------------ -----------------------
David N. Dinkins $12,615 $20,080
Peter E. Guernsey $12,615 $20,080
John I. Howell $ 5,091 $20,080
Peter S. Knight $ 4,591 $17,750
William L. Means $12,565 $20,000
Clarence F. Michalis $ 5,091 $20,080
Hermann C. Schwab $12,615 $20,080
James D. Vaughn $ 5,040 $20,000

* The Total Compensation shown in this column for each Trustee includes
compensation for services as a Trustee of the Trust, Schroder Capital Funds
(Delaware) and Schroder Global Series Trust. The Trust, Schroder Capital
Funds (Delaware) and Schroder Global Series Trust are considered part of
the same "Fund Complex" for these purposes.

The Trust's Declaration of Trust provides that the Trust will indemnify its
Trustees and officers against liabilities and expenses incurred in connection
with litigation in which they may be involved because of their offices with the
Trust, except if it is determined in the manner specified in the Declaration of
Trust that they have not acted in good faith in the reasonable belief that their
actions were in the best interests of the Trust or that such indemnification
would relieve any officer or Trustee of any liability to the Trust or its
shareholders by reason of willful misfeasance, bad faith, gross negligence, or
reckless disregard of his or her duties. The Trust by-laws provide that the
conduct of a Trustee shall be evaluated solely by reference to a hypothetical
reasonable person, without regard to any special expertise, knowledge, or other
qualifications of the Trustee, or any determination that the Trustee is an
"audit committee financial expert." The Trust bylaws provide that the Trust will
indemnify its Trustees against liabilities and expenses incurred in connection
with litigation or formal or informal investigations in which they may become
involved because of their service as Trustees, except to the extent prohibited
by the Declaration of Trust. The Trust, at its expense, provides liability
insurance for the benefit of its Trustees and officers.

SCHRODERS AND ITS AFFILIATES

Schroders serves as the investment adviser for the Fund. Schroders is a wholly
owned subsidiary of Schroder U.S. Holdings Inc., which currently engages through
its subsidiary firms in the asset management business. Affiliates of Schroder
U.S. Holdings Inc. (or their predecessors) have been investment managers since
1927. Schroder U.S. Holdings Inc. is a wholly owned subsidiary of Schroder
International Holdings, which is a wholly owned subsidiary of Schroders plc, a
publicly owned holding company organized under the laws of England. Schroders
plc and its affiliates currently engage in the asset management business, and as
of March 31, 2006, had under management assets of approximately $223.2 billion.
Schroders' address is 875 Third Avenue, 22nd Floor, New York, New York 10022.

SIMNA Ltd., an affiliate of Schroders, has served as sub-adviser to the Fund
since its inception.

Schroder Fund Advisors Inc., the Trust's principal underwriter, is a wholly
owned subsidiary of Schroder Investment Management North America Inc.

-30-

PORTFOLIO MANAGERS

The portfolio managers primarily responsible for making investment decisions for
the Fund are: Justin Abercrombie, Lead Portfolio Manager and Head of
Quantitative Equity Products; Arnaud Amsellem, Senior Quantitative Analyst and
Portfolio Manager; Stephen Langford, Senior Quantitative Analyst and Portfolio
Manager; David Philpotts, Senior Quantitative Analyst and Portfolio Manager;
Kristian Brock, Quantitative Analyst and Portfolio Manager; and James Larkman,
Quantitative Analyst and Portfolio Manager.

Other Accounts Managed. The following table shows information regarding other
accounts managed by the portfolio managers of the Fund, as of June 30, 2006:

NUMBER OF ACCOUNTS TOTAL ASSETS IN
WHERE ADVISORY FEE IS ACCOUNTS WHERE
NUMBER OF TOTAL ASSETS BASED ON ACCOUNT ADVISORY FEE IS BASED
ACCOUNTS IN ACCOUNTS PERFORMANCE ON ACCOUNT PERFORMANCE
--------- -------------- --------------------- ----------------------

JUSTIN ABERCROMBIE
Registered Investment 1 $1.349 billion None None
Companies
Other Pooled Investment 3 $1.332 billion 1 $156 million
Vehicles
Other Accounts 2 $ 264 million 2 $264 million

ARNAUD AMSELLEM
Registered Investment 1 $1.349 billion None None
Companies
Other Pooled Investment 2 $ 101 million None None
Vehicles
Other Accounts 1 $ 131 million None None

STEPHEN LANGFORD
Registered Investment 1 $1.349 billion None None
Companies
Other Pooled Investment 2 $ 701 million 1 $144 million
Vehicles
Other Accounts 1 $ 160 million 1 $160 million

DAVID PHILPOTTS
Registered Investment 1 $1.349 billion None None
Companies
Other Pooled Investment 1 $ 24 million None None
Vehicles
Other Accounts None None None None

KRISTIAN BROCK

-31-

Registered Investment 1 $1.349 billion None None
Companies
Other Pooled Investment None None None None
Vehicles
Other Accounts 1 $ 152 million None None

JAMES LARKMAN
Registered Investment 1 $1.349 billion None None
Companies
Other Pooled Investment None None None None
Vehicles
Other Accounts 1 $ 45 million None None

JOHN MARSLAND
Registered Investment 1 $1.349 billion None None
Companies
Other Pooled Investment None None None None
Vehicles
Other Accounts 1 $146 million None None

Material Conflicts of Interest. Whenever a portfolio manager of the Fund manages
other accounts, potential conflicts of interest exist, including potential
conflicts between the investment strategy of the Fund and the investment
strategy of the other accounts. For example, in certain instances, a portfolio
manager may take conflicting positions in a particular security for different
accounts, by selling a security for one account and continuing to hold it for
another account. In addition, the fact that other accounts require the portfolio
manager to devote less than all of his or her time to the Fund may be seen
itself to constitute a conflict with the interest of the Fund.

Each portfolio manager may also execute transactions for another fund or
account at the direction of such fund or account that may adversely impact the
value of securities held by the Fund. Securities selected for funds or accounts
other than such Fund may outperform the securities selected for the Fund.
Finally, if the portfolio manager identifies a limited investment opportunity
that may be suitable for more than one fund or other account, the Fund may not
be able to take full advantage of that opportunity due to an allocation of that
opportunity across all eligible funds and accounts. Schroders' policies,
however, require that portfolio managers allocate investment opportunities among
accounts managed by them in an equitable manner over time. Orders are normally
allocated on a pro rata basis, except that in certain circumstances, such as the
small size of an issue, orders will be allocated among clients in a manner
believed by Schroders to be fair and equitable over time. See "Brokerage
Allocation and Other Practices" for more information about this process.

The structure of a portfolio manager's compensation may give rise to
potential conflicts of interest. A portfolio manager's base pay tends to
increase with additional and more complex responsibilities that include
increased assets under management, which indirectly links compensation to sales.
Also, potential conflicts of interest may arise since the structure of
Schroders' compensation may vary from account to account.

Schroders has adopted certain compliance procedures that are designed to
address these, and other, types of conflicts. However, there is no guarantee
that such procedures will detect each and every situation where a conflict
arises.

Compensation. Schroders' methodology for measuring and rewarding the
contribution made by portfolio managers combines quantitative measures with
qualitative measures. The Fund's portfolio managers are

-32-

compensated for their services to the Fund and to other accounts they manage in
a combination of base salary and annual discretionary bonus, as well as the
standard retirement, health and welfare benefits available to all Schroders
employees. Base salary of Schroders employees is determined by reference to the
level of responsibility inherent in the role and the experience of the
incumbent, is benchmarked annually against market data to ensure competitive
salaries, and is paid in cash. The portfolio managers' base salary is fixed and
is subject to an annual review and will increase if market movements make this
necessary or if there has been an increase in responsibilities.

Each portfolio manager's bonus is based in part on performance.
Discretionary bonuses for portfolio managers are determined by a number of
factors. At a macro level the total amount available to spend is a function of
the compensation to revenue ratio achieved by Schroders globally. Schroders then
assesses the performance of the division and of a management team to determine
the share of the aggregate bonus pool that is spent in each area. This focus on
"team" maintains consistency and minimizes internal competition that may be
detrimental to the interests of Schroders' clients. For each team, Schroders
assesses the performance of their funds relative to competitors and to the
relevant benchmarks over one and three year periods, the level of funds under
management and the level of performance fees generated. Performance is evaluated
for each quarter, year and since inception of the Fund. Mr. Abercrombie and Mr.
Langford's compensation for certain other accounts they manage is based upon
account performance. Mr. Ansellem, Mr. Philpotts, Mr. Brock, and Mr. Larkman's
compensation for all other accounts they manage is not based upon account
performance.

Schroders also reviews "softer" factors such as leadership, innovation,
contribution to other parts of the business an adherence to corporate values of
excellence, integrity, teamwork, passion and innovation. An employee's bonus is
paid in a combination of cash and Schroders plc stock, as determined by
Schroders. This stock vests over a period of three years and ensures that the
interests of the employee are aligned with those of shareholders of Schroders.

Ownership of Securities. As of the date hereof, no shares of the Fund are
outstanding.

MANAGEMENT CONTRACT

Management Contract. Under a Management Contract between the Trust, on behalf of
the Fund, and Schroders, Schroders, at its expense, provides the Fund with (i)
investment advisory services and advises and assists the officers of the Trust
in taking such steps as are necessary or appropriate to carry out the decisions
of its Trustees regarding the conduct of business of the Trust and the Fund, and
(ii) management and administrative services necessary for the operation of the
Fund, including preparation of shareholder reports and communications,
regulatory compliance, such as reports to and filings with the SEC and state
securities commissions, and general supervision of the operation of the Fund,
including coordination of the services performed by the Fund's
sub-administrator, transfer agent, custodian, independent auditors, legal
counsel and others.

Under the Management Contract, Schroders is required to continuously
furnish the Fund an investment program consistent with the investment objective
and policies of the Fund, and to determine, for the Fund, what securities shall
be purchased, what securities shall be held or sold, and what portion of the
Fund's assets shall be held uninvested, subject always to the provisions of the
Trust's Declaration of Trust and by-laws, and of the Investment Company Act, and
to the Fund's investment objective, policies,

-33-

and restrictions, and subject further to such policies and instructions as the
Trustees may from time to time establish.

As compensation for services provided to the Fund pursuant to the
Management Contract, Schroders is entitled to receive from the Trust a fee,
computed and paid quarterly, at the following annual rate (based on the Fund's
average daily net assets): 1.00%. In order to limit the expenses of the Fund's
Investor Shares and Advisor Shares, Schroders has separately agreed to reduce
its compensation (and, if necessary, to pay other Fund expenses) until August
30, 2007 to the extent that the Total Annual Operating Expenses of the Fund
(other than interest, taxes, and extraordinary expenses, which may include
typically non-recurring expenses such as, for example, organizational expenses,
litigation expenses, and shareholder meeting expenses) allocable to its Investor
Shares exceed the following annual rate (based on the average daily net assets
attributable to the Fund's Investor Shares): 1.25%, and to the extent that the
Total Annual Operating Expenses of the Fund (other than interest, taxes, and
extraordinary expenses, which may include typically non-recurring expenses such
as, for example, organizational expenses, litigation expenses, and shareholder
meeting expenses) allocable to its Advisor Shares exceed the following annual
rate (based on the average daily net assets allocable to the Fund's Advisor
Shares): 1.50%. Schroders makes available to the Trust, without additional
expense to the Trust, the services of such of its directors, officers, and
employees as may duly be elected Trustees or officers of the Trust, subject to
their individual consent to serve and to any limitations imposed by law.
Schroders pays the compensation and expenses of officers and executive employees
of the Trust. Schroders also provides investment advisory research and
statistical facilities and all clerical services relating to such research,
statistical, and investment work. Schroders pays the Trust's office rent.

Under the Management Contract, the Trust is responsible for all its other
expenses, which may include clerical salaries not related to investment
activities; fees and expenses incurred in connection with membership in
investment company organizations; brokers' commissions; payment for portfolio
pricing services to a pricing agent, if any; legal expenses; auditing expenses;
accounting expenses; payments under any distribution plan; shareholder servicing
payments; taxes and governmental fees; fees and expenses of the transfer agent
and investor servicing agent of the Trust; the cost of preparing share
certificates or any other expenses, including clerical expenses, incurred in
connection with the issue, sale, underwriting, redemption, or repurchase of
shares; the expenses of and fees for registering or qualifying securities for
sale; the fees and expenses of the Trustees of the Trust who are not affiliated
with Schroders; the cost of preparing and distributing reports and notices to
shareholders; public and investor relations expenses; and fees and disbursements
of custodians of the Fund's assets. The Trust is also responsible for its
expenses incurred in connection with litigation, proceedings, and claims and the
legal obligation it may have to indemnify its officers and Trustees with respect
thereto.

The Management Contract provides that Schroders shall not be subject to any
liability to the Trust or to any shareholder for any act or omission in
connection with rendering services to the Trust in the absence of willful
misfeasance, bad faith, gross negligence, or reckless disregard of its duties.

The Management Contract may be terminated as to the Fund without penalty by
vote of the Trustees, by the shareholders of the Fund, or by Schroders, on 60
days' written notice. The Management Contract also terminates without payment of
any penalty in the event of its assignment. In addition, the Management Contract
may be amended only by a vote of the shareholders of the Fund and by the vote,
cast in person at a meeting called for the purpose of voting on such approval,
of a majority of the Trustees who are not "interested persons" of Schroders. The
Management Contract provides that it will continue in effect from year to year
(after an initial two-year period) only so long as such continuance is approved
at least annually by vote of either the Trustees or the shareholders of the
Fund, and, in either case, by a majority of the Trustees who are not "interested
persons" of Schroders. In each of the foregoing cases, the vote of the
shareholders is the affirmative vote of a "majority of the outstanding voting
securities" (as defined above under "Investment Restrictions").

-34-

Subadvisory Agreement. The Trustees of the Trust have approved an arrangement
whereby Schroders would retain SIMNA Ltd. to serve as sub-adviser to the Fund.
In connection therewith, the Trustees approved an Investment Subadvisory
Agreement between Schroders, SIMNA Ltd. and the Trust, on behalf of the Fund
(the "Subadvisory Agreement").

Under the Subadvisory Agreement, subject to the oversight of the Trustees
and the direction and control of Schroders, SIMNA Ltd. is required to provide on
behalf of the Fund the portfolio management services required of Schroders under
the Fund's Management Contract. Accordingly, SIMNA Ltd. will be required to
regularly provide the Fund with investment research, advice, and supervision and
furnish continuously investment programs consistent with the investment
objectives and policies of the Fund, and determine, what securities shall be
purchased, what securities shall be held or sold, and what portion of the Fund's
assets shall be held uninvested, subject always to the provisions of the Trust's
Declaration of Trust and By-laws, and of the Investment Company Act, and to the
Fund's investment objectives, policies, and restrictions, and subject further to
such policies and instructions as the Trustees may from time to time establish.

For the services to be rendered by SIMNA Ltd., Schroders (and not the Trust
or the Fund) will pay to SIMNA Ltd. a monthly fee in an amount equal to fifty
percent (50%) of all fees actually paid by the Fund to Schroders for such month
under the Management Contract, provided that SIMNA Ltd.'s fee for any period
will be reduced such that SIMNA Ltd. will bear fifty percent (50%) of any
voluntary fee waiver observed or expense reimbursement borne by Schroders with
respect to the Fund for such period.

The Subadvisory Agreement provides that SIMNA Ltd. shall not be subject to
any liability to the Trust or Schroders for any mistake of judgment or in any
event whatsoever in connection with rendering service to the Trust in the
absence of willful misfeasance, bad faith, gross negligence, or reckless
disregard of its duties.

The Subadvisory Agreement relating to the Fund may be terminated with
respect to the Fund without penalty (i) by vote of the Trustees or by vote of a
majority of the outstanding voting securities (as defined above) of the Fund on
60 days' written notice to SIMNA Ltd., (ii) by Schroders on 60 days' written
notice to SIMNA Ltd. or (iii) by SIMNA Ltd. on 60 days' written notice to
Schroders and the Trust. The Subadvisory Agreement will also terminate without
payment of any penalty in the event of its assignment. The Subadvisory Agreement
may be amended only by written agreement of all parties thereto and otherwise in
accordance with the Investment Company Act.

ADMINISTRATIVE SERVICES

The Trust, on behalf of the Fund, has entered into an administration and
accounting agreement with SEI Investments Global Fund Services ("SEI"). Under
that agreement, the Trust, together with Schroder Capital Funds (Delaware),
another trust comprised of funds managed by Schroders, pays fees to SEI based on
the combined average daily net assets of all the funds of Schroder Capital Funds
(Delaware) and the Trust, according to the following annual rates: 0.115% of the
first $600 million of such assets; 0.11% on the next $400 million of such
assets; 0.09% on the next $1 billion of such assets; and 0.07% on the average
daily net assets in excess of $2 billion. The Fund pays its pro rata portion of
such expenses. The administration and accounting agreement is terminable by
either party at the end of a three year initial term or thereafter, at any time,
by either party upon six (6) months written notice to the other party. The
administration and accounting agreement is terminable by either party in the
case of a material breach.

-35-

DISTRIBUTOR

Pursuant to a Distribution Agreement with the Trust, Schroder Fund Advisors
Inc. (the "Distributor"), 875 Third Avenue, 22nd Floor, New York, New York
10022, serves as the distributor for the Trust's continually offered shares. The
Distributor pays all of its own expenses in performing its obligations under the
Distribution Agreement. The Distributor is not obligated to sell any specific
amount of shares of any Fund. Please see "Schroders and its Affiliates" for
ownership information regarding the Distributor.

Distribution plan for Advisor Shares. The Fund has adopted a Distribution Plan
pursuant to Rule 12b-1 under the Investment Company Act that allows the Fund to
compensate the Distributor in connection with the distribution of the Fund's
Advisor shares. Under the Plan, the Fund may make payments at an annual rate up
to 0.25% of the average daily net assets attributable to its Advisor Shares.
Because the fees are paid out of the Fund's assets attributable to its Advisor
shares on an ongoing basis, over time these fees will increase the cost of an
investment in Advisor Shares of the Fund and may cost an investor more than
paying other types of sales charges.

The Distribution Plan is a compensation plan. The various costs and
expenses that may be paid or reimbursed by amounts paid under the Distribution
Plan include advertising expenses, costs of printing prospectuses and other
materials to be given or sent to prospective investors, expenses of sales
employees or agents of the Distributor, including salary, commissions, travel
and related expenses in connection with the distribution of Advisor Shares,
payments to broker-dealers who advise shareholders regarding the purchase, sale,
or retention of Advisor Shares, and payments to banks, trust companies,
broker-dealers (other than the Distributor), or other financial organizations.

The Distribution Plan may not be amended to increase materially the amount
of payments permitted thereunder without the approval of a majority of the
outstanding Advisor Shares of the Fund. Any other material amendment to the
Distribution Plan must be approved both by a majority of the Trustees and a
majority of those Trustees ("Qualified Trustees") who are not "interested
persons" (as defined in the Investment Company Act) of the Trust, and who have
no direct or indirect financial interest in the operation of the Distribution
Plan or in any related agreement, by vote cast in person at a meeting called for
the purpose. The Distribution Plan will continue in effect for successive
one-year periods provided each such continuance is approved by a majority of the
Trustees and the Qualified Trustees by vote cast in person at a meeting called
for the purpose. The Distribution Plan may be terminated at any time by vote of
a majority of the Qualified Trustees or by vote of a majority of the Fund's
outstanding Advisor Shares.

BROKERAGE ALLOCATION AND OTHER PRACTICES

SELECTION OF BROKERS. Schroders, in selecting brokers to effect
transactions on behalf of the Fund, seeks to obtain the best execution
available.

ALLOCATION. Schroders may deem the purchase or sale of a security to be in
the best interests of the Fund as well as other clients of Schroders. In such
cases, Schroders may, but is under no obligation to, aggregate all such
transactions in order to obtain the most favorable price or lower brokerage
commissions and efficient execution. Orders are normally allocated on a pro rata
basis, except that in certain circumstances, such as the small size of an issue,
orders will be allocated among clients in a manner believed by Schroders to be
fair and equitable over time.

-36-

BROKERAGE AND RESEARCH SERVICES. Transactions on U.S. stock exchanges and
other agency transactions involve the payment by the Trust of negotiated
brokerage commissions. Schroders may determine to pay a particular broker
varying commissions according to such factors as the difficulty and size of the
transaction. Transactions in foreign securities often involve the payment of
fixed brokerage commissions, which are generally higher than those in the United
States, and therefore certain portfolio transaction costs may be higher than the
costs for similar transactions executed on U.S. securities exchanges. There is
generally no stated commission in the case of securities traded in the
over-the-counter markets, but the price paid by the Fund usually includes an
undisclosed dealer commission or mark-up. In underwritten offerings, the price
paid by the Trust includes a disclosed, fixed commission or discount retained by
the underwriter or dealer.

Schroders places all orders for the purchase and sale of portfolio
securities and buys and sells securities through a substantial number of brokers
and dealers. In so doing, it uses its best efforts to obtain the best execution
available. In seeking the best price and execution, Schroders considers all
factors it deems relevant, including price, the size of the transaction, the
nature of the market for the security, the amount of the commission, the timing
of the transaction (taking into account market prices and trends), the
reputation, experience, and financial stability of the broker-dealer involved,
and the quality of service rendered by the broker-dealer in other transactions.

It has for many years been a common practice in the investment advisory
business for advisers of investment companies and other institutional investors
to receive research, statistical, and quotation services from several
broker-dealers that execute portfolio transactions for the clients of such
advisers. Consistent with this practice, Schroders receives research,
statistical, and quotation services from many broker-dealers with which it
places the Fund's portfolio transactions. These services, which in some cases
may also be purchased for cash, include such matters as general economic and
security market reviews, industry and company reviews, evaluations of
securities, and recommendations as to the purchase and sale of securities. Some
of these services are of value to Schroders and its affiliates in advising
various of their clients (including the Trust), although not all of these
services are necessarily useful and of value in managing the Fund. The
investment advisory fee paid by the Fund is not reduced because Schroders and
its affiliates receive such services.

As permitted by Section 28(e) of the Securities Exchange Act of 1934, as
amended (the "Securities Exchange Act"), and by the Management Contract,
Schroders may cause the Fund to pay a broker that provides brokerage and
research services to Schroders an amount of disclosed commission for effecting a
securities transaction for the Fund in excess of the commission which another
broker would have charged for effecting that transaction. Schroders' authority
to cause the Fund to pay any such greater commissions is also subject to such
policies as the Trustees may adopt from time to time.

SIMNA Ltd., in its capacity as subadviser to the Fund, observes
substantially the same allocation and brokerage and research policies and
practices as those observed by Schroders described above.

OTHER PRACTICES. Schroders and its affiliates also manage private
investment companies ("hedge funds") that are marketed to, among others,
existing Schroders clients. These hedge funds may invest in the same securities
as those invested in by the Fund. The hedge funds' trading methodologies are
generally different than those of the Fund and usually include short selling and
the aggressive use of leverage. At times, the hedge funds may be selling short
securities held long in the Fund. At times, the hedge funds may be selling short
securities held long in the Fund.

-37-

DETERMINATION OF NET ASSET VALUE

The net asset value per share of each class of shares of the Fund is
determined daily as of the close of trading on the New York Stock Exchange (the
"Exchange") (normally 4:00 p.m., Eastern Time) on each day the Exchange is open
for trading.

Securities for which market quotations are readily available are valued at
those quotations. Securities for which current market quotations are not readily
available are valued at fair value pursuant to procedures established by the
Board of Trustees, which are summarized below.

Equity securities listed or traded on a domestic or foreign stock exchange
for which last sales information is readily available are valued at the last
reported sale price on the exchange on that day or, in the absence of sales that
day, at the mean between the closing bid and ask prices (the "mid-market price")
or, if none, the last sale price on the preceding trading day. (Where the
securities are traded on more than one exchange, they are valued based on
trading on the exchange where the security is principally traded.) Securities
purchased in an initial public offering and that have not commenced trading in a
secondary market are valued at cost. Unlisted securities for which market
quotations are readily available generally are valued at the most recently
reported sale prices on any day or, in the absence of a reported sale price, at
mid-market prices. In the case of securities traded primarily on the National
Association of Securities Dealers' Automated Quotation System ("NASDAQ"), the
NASDAQ Official Closing Price will, if available, be used to value such
securities as such price is reported by NASDAQ to market data vendors. If the
NASDAQ Official Closing Price is not available, such securities will be valued
as described above for exchange-traded securities.

Reliable market quotations are not considered to be readily available for
most long-term bonds. Such securities are valued at fair value, generally on the
basis of valuations furnished by pricing services, which determine valuations
for normal, institutional-size trading units of such securities using methods
based on market transactions for comparable securities and various relationships
between securities that are generally recognized by institutional traders. Below
investment grade debt instruments ("high yield debt") and emerging markets debt
instruments will generally be valued at prices furnished by pricing services
based on the mean of bid and asked prices supplied by brokers or dealers,
although, if the bid-asked spread exceeds five points, that security will
typically be valued at the bid price. Short-term fixed income securities with
remaining maturities of 60 days or less are valued at amortized cost, unless
Schroders, believes another valuation is more appropriate.

Options and futures contracts traded on a securities exchange or board of
trade shall be valued at the last reported sales price or, in the absence of a
sale, at the closing mid-market price on the principal exchange where they are
traded. Options not traded on a securities exchange or board of trade for which
over-the-counter market quotations are readily available shall be valued at the
most recently reported mid-market price.

All other securities and other property are valued at fair value based on
procedures established by the Board of Trustees.

All assets and liabilities of the Fund denominated in foreign currencies
are translated into U.S. dollars as of the close of trading of the New York
Stock Exchange (normally 4:00 p.m., Eastern time) based on the mean between the
last quoted bid and ask price of such currencies against the U.S. dollar.

-38-

If any securities held by the Fund are restricted as to resale, Schroders
will obtain a valuation based on the current bid for the restricted security
from one or more independent dealers or other parties reasonably familiar with
the facts and circumstances of the security. If Schroders is unable to obtain a
fair valuation for a restricted security from an independent dealer or other
independent party, a pricing committee (comprised of certain officers at
Schroders) shall determine the bid value of such security. The valuation
procedures applied in any specific instance are likely to vary from case to
case. However, consideration is generally given to the financial position of the
issuer and other fundamental analytical data relating to the investment and to
the nature of the restrictions on disposition of the securities (including any
registration expenses that might be borne by the Trust in connection with such
disposition). In addition, specific factors are also generally considered, such
as the cost of the investment, the market value of any unrestricted securities
of the same class (both at the time of purchase and at the time of valuation),
the size of the holding, the prices of any recent transactions or offers with
respect to such securities, and any available analysts' reports regarding the
issuer.

Generally, trading in certain securities (such as foreign securities) is
substantially completed each day at various times prior to the close of the New
York Stock Exchange. The values of these securities used in determining the net
asset value of the Fund's shares are computed as of such times. Also, because of
the amount of time required to collect and process trading information as to
large numbers of securities issues, the values of certain securities (such as
convertible bonds and U.S. Government securities) are determined based on market
quotations collected earlier in the day. Occasionally, events affecting the
value of such securities may occur between such times and the close of the
Exchange. If events materially affecting the value of such securities occur
during such period, then the Fair Value Committee of the Trust may consider
whether it is appropriate to value these securities at their fair value.

The proceeds received by the Fund for each issue or sale of its shares, and
all income, earnings, profits, and proceeds thereof, subject only to the rights
of creditors, will be specifically allocated to the Fund, and constitute the
underlying assets of the Fund. The underlying assets of each Fund will be
segregated on the Trust's books of account, and will be charged with the
liabilities in respect of the Fund and with a share of the general liabilities
of the Trust. The Fund's assets will be further allocated among its constituent
classes of shares on the Trust's books of account. Expenses with respect to any
two or more funds or classes may be allocated in proportion to the net asset
values of the respective funds or classes except where allocations of direct
expenses can otherwise be fairly made to a specific fund or class. The net asset
value of the Fund's Advisor Shares will generally differ from that of its
Investor Shares due to the variance in dividends paid on each class of shares
and differences in the expenses of Advisor Shares and Investor Shares.

REDEMPTION OF SHARES

The Fund imposes a 2.00% redemption fee on shares redeemed (including in
connection with an exchange) two months or less from their date of purchase. The
fee is not a sales charge (load); it is paid directly to the Fund.

The redemption fee may be waived, in Schroders' sole discretion, for
certain categories of redemptions that do not raise short-term trading concerns.
These categories include but are not limited to shares redeemed through
designated systematic withdrawal plans. The redemption fee does apply to IRAs,
and may also apply to shares held in employer-sponsored retirement accounts
(such as 401(k), 403(b), Keogh, profit sharing, SIMPLE IRA, SEP-IRA and money
purchase pension accounts) and shares in retirement plans held in broker omnibus
accounts.

-39-

ARRANGEMENTS PERMITTING FREQUENT PURCHASES AND REDEMPTIONS OF FUND SHARES

The Fund has no arrangements with any person to permit frequent purchases
and redemptions of the Fund shares.

TAXES

The following discussion of U.S. federal income tax consequences is based
on the Code), existing U.S. Treasury regulations, and other applicable
authority, as of the date of this SAI. These authorities are subject to change
by legislative or administrative action, possibly with retroactive effect. The
following discussion is only a summary of some of the important U.S. federal tax
considerations generally applicable to investments in the Fund. It does not
address special tax rules applicable to certain classes of investors, such as,
among others, IRAs and other retirement plans, tax-exempt entities, foreign
investors, insurance companies, financial institutions and investors making
in-kind contributions to the Fund. You should consult your tax advisor for more
information about your own tax situation, including possible other federal,
state, local, and, where applicable, foreign tax consequences of investing in
the Fund.

TAXATION OF THE FUND. The Fund intends to qualify each year and elect to be
taxed as a "regulated investment company" (a "RIC") under Subchapter M of the
Code.

As a RIC qualifying to have its tax liability determined under Subchapter
M, the Fund will not be subject to federal income tax on income paid to
shareholders in the form of dividends or capital gain distributions.

In order to qualify as a RIC the Fund must, among other things, (a) derive
at least 90% of its gross income from dividends, interest, payments with respect
to securities loans, gains from the sale or other disposition of stock,
securities, or foreign currencies, and other income (including gains from
options, futures, or forward contracts) derived with respect to its business of
investing in such stock, securities, or currencies; (b) diversify its holdings
so that, at the close of each quarter of its taxable year, (i) at least 50% of
the value of its total assets consists of cash, cash items, U.S. Government
securities, securities of other RICs and other securities limited generally with
respect to any one issuer to not more than 5% of the value of the total assets
of the Fund and not more than 10% of the outstanding voting securities of such
issuer, and (ii) not more than 25% of the value of its assets is invested in (x)
the securities of any one issuer (other than the U.S. Government or other RICs)
or of two or more issuers which the Fund controls and which are engaged in the
same, similar or related trades and businesses or (y) the securities of one or
more qualified publicly traded partnerships (as defined below); and (c)
distribute with respect to each taxable year at least 90% of the sum of its
investment company taxable income (as that term is defined in the Code without
regard to the deduction for dividends paid - generally, taxable ordinary income
and the excess, if any, of net short-term capital gains over net long-term
capital losses) and net tax-exempt interest income, for such year. The Fund
intends to make such distributions.

In general, for purposes of the 90% gross income requirement described in
paragraph (a) above, income derived from a partnership will be treated as
qualifying income only to the extent such income is attributable to items of
income of the partnership which would be qualifying income if realized by the
regulated investment company. However, the American Jobs Creation Act of 2004
(the "2004 Act"), provides that for taxable years of a regulated investment
company beginning after October 22, 2004, 100% of the net income derived from an
interest in a "qualified publicly traded partnership" (defined as a

-40-

partnership (i) interests in which are traded on an established securities
market or readily tradable on a secondary market or the substantial equivalent
thereof and (ii) that derives less than 90% of its income from the qualifying
income described in paragraph (a) above) will be treated as qualifying income.
In addition, although in general the passive loss rules of the Code do not apply
to regulated investment companies, such rules do apply to a regulated investment
company with respect to items attributable to an interest in a qualified
publicly traded partnership. Finally, for purposes of paragraph (b) above, the
term "outstanding voting securities of such issuer" will include the equity
securities of a qualified publicly traded partnership.

If the Fund does not qualify for taxation as a RIC for any taxable year,
the Fund's taxable income will be subject to corporate income taxes, and all
distributions from earnings and profits, including distributions of net
tax-exempt income and net long-term capital gains (if any), will be taxable to
shareholders as ordinary income. In addition, in order to requalify for taxation
as a RIC, the Fund may be required to recognize unrealized gains, pay
substantial taxes and interest, and make certain distributions.

If the Fund fails to distribute in a calendar year substantially all of its
ordinary income for such year and substantially all of its capital gain net
income for the one-year period ending October 31 (or later if the Fund is
permitted so to elect and so elects), plus any retained amount from the prior
years (to the extent not previously subject to tax under subchapter M), the Fund
will be subject to a 4% excise tax on the under-distributed amounts. A dividend
paid to shareholders by the Fund in January of a year generally is deemed to
have been paid by the Fund on December 31 of the preceding year, if the dividend
was declared and payable to shareholders of record on a date in October,
November, or December of that preceding year. The Fund intends generally to make
distributions sufficient to avoid imposition of the 4% excise tax.

TAXABLE DISTRIBUTIONS. For federal income tax purposes, distributions of
investment income (other than exempt-interest dividends, as described below) are
taxed to shareholders as ordinary income. Taxes on distributions of capital
gains are determined by how long the Fund owned the investments that generated
the gains, rather than how long you owned your shares. Distributions of net
capital gains from the sale of investments that the Fund has held for more than
one year and that are properly designated by the Fund as capital gain dividends
will be taxable as long-term capital gains. Distributions of gains from the sale
of investments that the Fund owned for one year or less will be taxable as
ordinary income.

For taxable years beginning before January 1, 2011, "qualified dividend
income" received by an individual will be taxed at the rates applicable to
long-term capital gain. In order for some portion of the dividends received by
the Fund shareholder to be qualified dividend income, the Fund must meet holding
period and other requirements with respect to some portion of the
dividend-paying stocks in its portfolio and the shareholder must meet holding
period and other requirements with respect to the Fund's shares. A dividend will
not be treated as qualified dividend income (at either the Fund or shareholder
level) (1) if the dividend is received with respect to any share of stock held
for fewer than 61 days during the 121-day period beginning on the date which is
60 days before the date on which such share becomes ex-dividend with respect to
such dividend (or, on the case of certain preferred stock, 91 days during the
181-day period beginning 90 days before such date), (2) to the extent that the
recipient is under an obligation (whether pursuant to a short sale or otherwise)
to make related payments with respect to positions in substantially similar or
related property, (3) if the recipient elects to have the dividend income
treated as investment interest, or (4) if the dividend is received from a
foreign corporation that is (a) not eligible for the benefits of a comprehensive
income tax treaty with the United States (with the exception of dividends

-41-

paid on stock of such a foreign corporation readily tradable on an established
security market in the United States) or (b) treated as a passive foreign
investment company.

In general, distributions of investment income designated by the Fund as
derived from qualified dividend income will be treated as qualified dividend
income by a shareholder taxed as an individual provided the shareholder meets
the holding period and other requirements described above with respect to such
Fund's shares. In any event, if the aggregate qualified dividends received by
the Fund during any taxable year are 95% or more of its gross income, then 100%
of the Fund's dividends (other than property designated capital gain dividends)
will be eligible to be treated as qualified dividend income. For this purpose,
the only gain included in the term "gross income" is the excess of net
short-term capital gain over net long-term capital loss.

Distributions are taxable to shareholders even if they are paid from income
or gains earned by the Fund before a shareholder's investment (and thus were
included in the price the shareholder paid). Distributions are taxable whether
shareholders receive them in cash or reinvest them in additional shares.

Long-term capital gain rates applicable to individuals have been
temporarily reduced - in general, to 15%, with lower rates applying to taxpayers
in the 10% and 15% rate brackets - for taxable years beginning before January 1,
2011.

TRANSACTIONS IN FUND SHARES. The sale, exchange or redemption of Fund
shares may give rise to a gain or loss. In general, any gain or loss realized
upon such a taxable disposition of shares will be treated as long-term capital
gain or loss if the shares have been held for more than 12 months. Otherwise the
gain or loss on the sale, exchange or redemption of Fund shares will be treated
as short-term capital gain or loss. However, if a shareholder sells shares at a
loss within six months of purchase, any loss will be disallowed for federal
income tax purposes to the extent of any exempt-interest dividends received on
such shares. In addition, any loss (not already disallowed as provided in the
preceding sentence) realized upon a taxable disposition of shares held for six
months or less will be treated as long-term, rather than short-term, to the
extent of any amounts treated as distributions from the Fund of long-term
capital gain with respect to the shares during the six-month period. All or a
portion of any loss realized upon a taxable disposition of Fund shares will be
disallowed if other shares of the same Fund are purchased within 30 days before
or after the disposition. In such a case, the basis of the newly purchased
shares will be adjusted to reflect the disallowed loss.

FOREIGN INVESTMENTS. The Fund's transactions in foreign currencies, foreign
currency-denominated debt securities and certain foreign currency options,
futures contracts and forward contracts (and similar instruments) may give rise
to ordinary income or loss to the extent such income or loss results from
fluctuations of the foreign currency concerned.

With respect to investment income and gains received by the Fund from
sources outside the United States, such income and gains may be subject to
foreign taxes which are withheld at the source. The effective rate of foreign
taxes to which the Fund will be subject depends on the specific countries in
which its assets will be invested and the extent of the assets invested in each
such country and, therefore, cannot be determined in advance. In addition, the
Fund's investments in foreign securities may increase or accelerate the Fund's
recognition of ordinary income or loss and may affect the timing or amount of
the Fund's distributions, including in situations where such distributions may
economically represent a return of a particular shareholder's investment.
Investments, if any, in "passive foreign investment companies" could subject the
Fund to U.S. federal income tax or other charges on certain distributions

-42-

from such companies and on disposition of investments in such companies;
however, the tax effects of such investments may be mitigated by making an
election to mark such investments to market annually or treat the passive
foreign investment company as a "qualified electing fund."

If more than 50% of the Fund's assets at year end consists of the
securities of foreign corporations, the Fund may elect to permit shareholders to
claim a credit or deduction on their income tax returns for their pro rata
portion of qualified taxes paid by the Fund to foreign countries in respect of
foreign securities the Fund has held for at least the minimum period specified
in the Code. In such a case, shareholders will include in gross income from
foreign sources their pro rata shares of such taxes. It is anticipated that
shareholders of the Fund generally will be entitled to claim a credit or
deduction with respect to foreign taxes. A shareholder's ability to claim a
foreign tax credit or deduction in respect of foreign taxes paid by the Fund may
be subject to certain limitations imposed by the Code, as a result of which a
shareholder may not get a full credit or deduction for the amount of such taxes.
In particular, shareholders must hold their Fund shares (without protection from
risk of loss) on the ex-dividend date and for at least 15 additional days during
the 30-day period surrounding the ex-dividend date to be eligible to claim a
foreign tax credit with respect to a given dividend. Shareholders who do not
itemize on their federal income tax returns may claim a credit (but no
deduction) for such foreign taxes.

HEDGING TRANSACTIONS. If the Fund engages in hedging transactions,
including hedging transactions in options, forward or futures contracts, and
straddles, or other similar transactions, it will be subject to special tax
rules (including constructive sale, mark-to-market, straddle, wash sale, and
short sale rules), the effect of which may be to accelerate income to the Fund,
defer losses to the Fund, cause adjustments in the holding periods of the Fund's
securities, convert long-term capital gain into short-term capital gain, or
convert short-term capital losses into long-term capital losses. These rules
could therefore affect the amount, timing and character of distributions to
shareholders. The Fund will endeavor to make any available elections pertaining
to such transactions in a manner believed to be in the best interest of the
Fund.

BACKUP WITHHOLDING. The Fund is generally required to withhold a percentage
of certain of your dividends and other distributions if you have not provided
the Fund with your correct taxpayer identification number (normally your Social
Security number), or if you are otherwise subject to backup withholding. The
backup withholding tax rate is 28% for amounts paid through 2010. The backup
withholding tax rate will be 31% for amounts paid after December 31, 2010.

TAX SHELTER REPORTING REGULATIONS. Under Treasury regulations, if a
shareholder realizes a loss on disposition of the Fund's shares of $2 million or
more for an individual shareholder or $10 million or more for a corporate
shareholder, the shareholder must file with the Internal Revenue Service a
disclosure statement on Form 8886. Direct shareholders of portfolio securities
are in many cases excepted from this reporting requirement, but under current
guidance, shareholders of a RIC are not excepted. Future guidance may extend the
current exception from this reporting requirement to shareholders of most or all
regulated investment companies. The fact that a loss is reportable under these
regulations does not affect the legal determination of whether the taxpayer's
treatment of the loss is proper. Shareholders should consult their tax advisors
to determine the applicability of these regulations in light of their individual
circumstances.

NON-U.S. SHAREHOLDERS. In general, dividends (other than capital gain
dividends) paid by the Fund to a shareholder that is not a "U.S. person" within
the meaning of the Code (a "foreign person") are subject to withholding of U.S.
federal income tax at a rate of 30% (or lower applicable treaty rate) even if

-43-

they are funded by income or gains (such as portfolio interest, short-term
capital gains, or foreign-source dividend and interest income) that, if paid to
a foreign person directly, would not be subject to withholding. However, under
the 2004 Act, effective for taxable years of a fund beginning after December 31,
2004 and before January 1, 2008, the Fund will not be required to withhold any
amounts (i) with respect to distributions (other than distributions to a foreign
person (w) that has not provided a satisfactory statement that the beneficial
owner is not a U.S. person, (x) to the extent that the dividend is attributable
to certain interest on an obligation if the foreign person is the issuer or is a
10% shareholder of the issuer, (y) that is within certain foreign countries that
have inadequate information exchange with the United States, or (z) to the
extent the dividend is attributable to interest paid by a person that is a
related person of the foreign person and the foreign person is a controlled
foreign corporation) from U.S.-source interest income that would not be subject
to U.S. federal income tax if earned directly by an individual foreign person,
to the extent such distributions are properly designated by the Fund (an
"interest-related dividend"), and (ii) with respect to distributions (other than
distributions to an individual foreign person who is present in the United
States for a period or periods aggregating 183 days or more during the year of
the distribution) of net short-term capital gains in excess of net long-term
capital losses, to the extent such distributions are properly designated by the
Fund (a "short-term capital gain dividend"). The Fund may opt not to designate
dividends as interest-related dividends or short-term capital gain dividends to
the full extent permitted by the Code. In addition, as indicated above, capital
gain dividends will not be subject to withholding of U.S. federal income tax.

If a beneficial holder who is a foreign person has a trade or business in
the United States, and the dividends are effectively connected with the conduct
by the beneficial holder of a trade or business in the United States, the
dividend will be subject to U.S. federal net income taxation at regular income
tax rates.

Under U.S. federal tax law, a beneficial holder of shares who is a foreign
person is not, in general, subject to U.S. federal income tax on gains (and is
not allowed a deduction for losses) realized on the sale of shares of the Fund
or on capital gain dividends unless (i) such gain or capital gain dividend is
effectively connected with the conduct of a trade or business carried on by such
holder within the United States, or (ii) in the case of an individual holder,
the holder is present in the United States for a period or periods aggregating
183 days or more during the year of the sale or capital gain dividend and
certain other conditions are met.

PRINCIPAL HOLDERS OF SECURITIES

As of the date hereof, no shares of the Fund are outstanding.

CUSTODIAN

JP Morgan Chase Bank, 270 Park Avenue, New York, New York, is the custodian
of the assets of the Fund. The custodian's responsibilities include safeguarding
and controlling the Fund's cash and securities, handling the receipt and
delivery of securities, and collecting interest and dividends on the Fund's
investments. The custodian does not determine the investment policies of the
Fund or decide which securities the Fund will buy or sell.

TRANSFER AGENT AND DIVIDEND DISBURSING AGENT

Boston Financial Data Services, Inc., Two Heritage Drive, North Quincy,
Massachusetts 02171, is the Trust's registrar, transfer agent, and dividend
disbursing agent.

-44-

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

PricewaterhouseCoopers LLP, the Trust's independent registered public
accounting firm, provides audit services, and tax return preparation services.
Their address is Two Commerce Square, Suite 1700, 2001 Market Street,
Philadelphia, Pennsylvania 19103.

CODE OF ETHICS

Schroders, Schroder Fund Advisors Inc., the Trust's distributor, and SIMNA
Ltd. have each adopted a Code of Ethics, and the Trust, Schroder Capital Funds
(Delaware) and Schroder Global Series Trust have adopted a combined Code of
Ethics, pursuant to the requirements of Rule 17j-1 of the Investment Company
Act. Subject to certain restrictions, these Codes of Ethics permit personnel
subject to the Codes to invest in securities, including securities that may be
purchased or held by the Fund. The Codes of Ethics have been filed as exhibits
to the Trust's Registration Statement.

PROXY VOTING POLICIES AND PROCEDURES

The Trust has delegated authority and responsibility to vote any proxies
relating to voting securities held by the Fund to Schroders, which intends to
vote such proxies in accordance with its proxy voting policies and procedures. A
copy of Schroders' proxy voting policies and procedures is attached as Appendix
A to this SAI. Information regarding how Schroders voted proxies relating to
portfolio securities during the most recent 12-month period ended June 30 is
available (1) without charge, upon request, through the Schroders Funds' website
at www.schroderfunds.com; and (2) on the Securities and Exchange Commission's
website at www.sec.gov.

LEGAL COUNSEL

Ropes & Gray LLP, One International Place, Boston, Massachusetts
02110-2624, serves as counsel to the Trust.

SHAREHOLDER LIABILITY

Under Massachusetts law, shareholders could, under certain circumstances,
be held personally liable for the obligations of the Trust. However, the Trust's
Declaration of Trust disclaims shareholder liability for acts or obligations of
the Trust and requires that notice of such disclaimer be given in each
agreement, obligation, or instrument entered into or executed by the Trust or
the Trustees. The Trust's Declaration of Trust provides for indemnification out
of each Fund's property for all loss and expense of any shareholder held
personally liable for the obligations of such Fund. Thus, the risk of a
shareholder's incurring financial loss on account of shareholder liability is
limited to circumstances in which the Fund would be unable to meet its
obligations.

FINANCIAL STATEMENTS

As the Fund has not commenced operations, financial statements for the Fund
are unavailable.

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APPENDIX A

SCHRODER INVESTMENT MANAGEMENT NORTH AMERICA INC.
POLICY RELATING TO IDENTIFYING AND ACTING UPON CONFLICTS
OF INTEREST IN CONNECTION WITH ITS PROXY VOTING OBLIGATIONS

This document sets forth Schroder Investment Management North America Inc.'s
("Schroders") policy with respect to proxy voting and its procedures to comply
with Rule 206(4)-6 under the Investment Advisers Act of 1940 and Rule 30b1-4
under the Investment Company Act of 1940. Specifically, Rule 206(4)-6 requires
that Schroders:

o Adopt and implement written policies and procedures reasonably
designed to ensure that proxies are voted in the best interest of
clients and

o Disclose its proxy voting policies and procedures to clients and
inform them how they may obtain information about how Schroders voted
proxies.

Rule 30b1-4 requires that the Schroder US Mutual Funds (the "Funds"):

o Disclose their proxy voting policies and procedures in their
registration statements and

o Annually, file with the SEC and make available to shareholders their
actual proxy voting.

(A) PROXY VOTING GENERAL PRINCIPLES

Schroders will evaluate and usually vote for or against all proxy requests
relating to securities held in any account managed by Schroders (unless this
responsibility has been retained by the client).

Proxies will be treated and evaluated with the same attention and investment
skill as the trading of securities in the accounts.

Proxies will be voted in a manner which is deemed most likely to protect and
enhance the longer term value of the security as an asset to the account.

PROXY COMMITTEE

The Proxy Committee consists of investment professionals and other officers and
is responsible for ensuring compliance with this proxy voting policy. The
Committee meets quarterly to review proxies voted, policy guidelines and to
examine any issues raised, including a review of any votes cast in connection
with controversial issues.

The procedure for evaluating proxy requests is as follows:

Schroders' Global Corporate Governance Team (the "Team") is responsible for the
initial evaluation of the proxy request, for seeking advice where necessary,
especially from the US small cap and mid cap product heads, and for consulting
with portfolio managers who have invested in the company should a controversial
issue arise.

When making proxy-voting decisions, Schroders generally adheres to the Global
Corporate Governance Policy (the "Policy"), as revised from time to time. The
Policy, which has been developed by Schroders'

A-1

Global Corporate Governance Team and approved by the Schroders Proxy Committee,
sets forth Schroders' positions on recurring issues and criteria for addressing
non-recurring issues. The Policy is a part of these procedures and is
incorporated herein by reference. The Proxy Committee exercises oversight to
assure that proxies are voted in accordance with the Policy and that any votes
inconsistent with the Policy or against management are appropriately documented.

Schroders uses Institutional Shareholder Services, Inc. ("ISS") to assist in
voting proxies. ISS provides proxy research, voting and vote-reporting services.
ISS's primary function with respect to Schroders is to apprise the Group of
shareholder meeting dates of all securities holdings, translate proxy materials
received from companies, provide associated research and provide considerations
and recommendations for voting on particular proxy proposals. Although Schroders
may consider ISS's and others' recommendations on proxy issues, Schroders bears
ultimate responsibility for proxy voting decisions.

Schroders may also consider the recommendations and research of other providers,
including the National Association of Pension Funds' Voting Issues Service.

CONFLICTS

From time to time, proxy voting proposals may raise conflicts between the
interests of Schroders' clients and the interests of Schroders and/or its
employees. Schroders is adopting this policy and procedures to ensure that
decisions to vote the proxies are based on the clients' best interests.

For example, conflicts of interest may arise when:

o Proxy votes regarding non-routine matters are solicited by an issuer
that, directly or indirectly, has a client relationship with
Schroders;

o A proponent of a proxy proposal has a client relationship with
Schroders;

o A proponent of a proxy proposal has a business relationship with
Schroders;

o Schroders has business relationships with participants in proxy
contests, corporate directors or director candidates;

The Team is responsible for identifying proxy voting proposals that may present
a material conflict of interest. If Schroders receives a proxy relating to an
issuer that raises a conflict of interest, the Team shall determine whether the
conflict is "material" to any specific proposal included within the proxy. The
Team will determine whether a proposal is material as follows:

o Routine Proxy Proposals: Proxy proposals that are "routine" shall be
presumed not to involve a material conflict of interest unless the
Team has actual knowledge that a routine proposal should be treated as
material. For this purpose, "routine" proposals would typically
include matters such as uncontested election of directors, meeting
formalities, and approval of an annual report/financial statements.

o Non-Routine Proxy Proposals: Proxy proposals that are "non-routine"
will be presumed to involve a material conflict of interest, unless
the Team determines that neither Schroders nor its personnel have a
conflict of interest or the conflict is unrelated to the proposal in
question. For this purpose, "non-routine" proposals would typically
include any contested matter, including a contested election of
directors, a merger or sale of substantial assets, a change in the
articles of incorporation that materially affects the rights of
shareholders, and compensation matters for

A-2

management (e.g., stock, option plans, retirement plans, profit-sharing or
other special remuneration plans). If the Team determines that there is, or
may be perceived to be, a conflict of interest when voting a proxy,
Schroders will address matters involving such conflicts of interest as
follows:

A. If a proposal is addressed by the Policy, Schroders will vote in
accordance with such Policy;

B. If Schroders believes it is in the best interests of clients to depart
from the Policy, Schroders will be subject to the requirements of C or D below,
as applicable;

C. If the proxy proposal is (1) not addressed by the Policy or (2) requires
a case-by-case determination, Schroders may vote such proxy as it determines to
be in the best interest of clients, without taking any action described in D
below, provided that such vote would be against Schroders' own interest in the
matter (i.e., against the perceived or actual conflict). The rationale of such
vote will be memorialized in writing; and

D. If the proxy proposal is (1) not addressed by the Policy or (2) requires
a case-by-case determination, and Schroders believes it should vote in a way
that may also benefit, or be perceived to benefit, its own interest, then
Schroders must take one of the following actions in voting such proxy: (a) vote
in accordance with ISS' recommendation; (b) inform the client(s) of the conflict
of interest and obtain consent to vote the proxy as recommended by Schroders; or
(c) obtain approval of the decision from the Chief Compliance Officer and the
Chief Investment Officer. The rationale of such vote will be memorialized in
writing.

RECORD OF PROXY VOTING

The Team will maintain, or have available, written or electronic copies of
each proxy statement received and of each executed proxy.

The Team will also maintain records relating to each proxy, including (i) the
voting decision with regard to each proxy; and (ii) any documents created by the
Team and/or the Proxy Committee, or others, that were material to making the
voting decision; (iii) any decisions of the Chief Compliance Officer and the
Chief Investment Officer.

Schroders will maintain a record of each written request from a client for proxy
voting information and its written response to any request (oral or written)
from any client for proxy voting information.

Such records will be maintained for six years and may be retained
electronically.

Additional Reports and Disclosures for the Schroder Funds

The Funds must disclose their policies and procedures for voting proxies in
their Statement of Additional Information. In addition to the records required
to be maintained by Schroders, the following information will be made available
to the Funds or their agent to enable the Funds to file Form N-PX under Rule
30b1-4:

For each matter on which a fund is entitled to vote:

A-3

o Name of the issuer of the security;

o Exchange ticker symbol;

o CUSIP number, if available;

o Shareholder meeting date;

o Brief summary of the matter voted upon;

o Source of the proposal, i.e., issuer or shareholder;

o Whether the fund voted on the matter;

o How the fund voted; and

o Whether the fund voted with or against management.

Further, the Funds are required to make available to shareholders the Funds'
actual proxy voting record. If requested, the most recently filed Form N-PX must
be sent within three (3) days of receipt of the request.

July 30, 2003

A-4

PART C: OTHER INFORMATION

ITEM 23. EXHIBITS

(a) Agreement and Declaration of Trust (see Note 1).

(b) Third Amended Bylaws of the Registrant (see Note 12).

(c)

(i) Portions of Agreement and Declaration of Trust Relating to
Shareholders' Rights (see Note 1).

(ii) Portions of Bylaws Relating to Shareholders' Rights (see Note 1).

(d)

(i) Form of Management Contract between the Trust, on behalf of Schroder
Enhanced Income Fund, and Schroder Investment Management North America, Inc.
(see Note 10).

(ii) Management Contract between the Trust, on behalf of Schroder Municipal
Bond Fund, Schroder Short-Term Municipal Bond Fund, Schroder Total Return Fixed
Income Fund (formerly, Schroder U.S. Core Fixed Income Fund and Schroder Fixed
Income Fund), and Schroder Investment Management North America, Inc. dated as of
December 9, 2003 (see Note 12).

(iii) Management Contract between the Trust, on behalf of Schroder Global
Equity Yield Fund, Schroder Global Opportunities Fund, Schroder Emerging Market
Equity Fund, Schroder Strategic Bond Fund, and Schroder U.S. Small and Mid Cap
Opportunities Fund, and Schroder Investment Management North America, Inc. (see
Note 16).

(iv) Investment Subadvisory Agreement between the Trust, on behalf of
Schroder Global Equity Yield Fund, Schroder Global Opportunities Fund, Schroder
Emerging Market Equity Fund, and Schroder Strategic Bond Fund, Schroder
Investment Management North America, Inc., and Schroder Investment Management
North America Ltd. (see Note 17).

(v) Management Contract between the Trust, on behalf of Schroder
International Diversified Value Fund, and Schroder Investment Management North
America, Inc. is filed herewith.

(vi) Investment Subadvisory Agreement between the Trust, on behalf of
Schroder International Diversified Value Fund, Schroder Investment Management
North America, Inc., and Schroder Investment Management North America Ltd. is
filed herewith.

(e) Distribution Agreement dated September 15, 1999 (see Note 3).

(f) Not applicable.

(g)

(i) Global Custody Agreement between the Trust and The Chase Manhattan Bank
dated as of November 5, 2001 ("Global Custody Agreement") (see Note 5).

(ii) Amendment to Custody Agreement between the Trust and JPMorgan Chase
Bank, NA (formerly, The Chase Manhattan Bank) dated October 26, 2005 (see Note
15).

(iii) Form of Third Amended and Restated Exhibit B to Global Custody
Agreement between the Trust and JPMorgan Chase Bank, NA (see Note 15).

(iv) Fifth Amended and Restated Exhibit B to Global Custody Agreement
between the Trust and JPMorgan Chase Bank, NA relating to Schroder International
Diversified Value Fund is filed herewith.

(h)

(i) Transfer Agent and Service Agreement (see Note 1).

(ii) Form of Delegation Amendment to Transfer Agent and Service Agreement
dated as of July 24, 2002 (see Note 6).

(iii) Amendment to Transfer Agent and Service Agreement relating to
Schroder Municipal Bond Fund and Schroder Short-Term Municipal Bond Fund, dated
December 31, 2003 (see Note 12).

(iv) Form of Letter to State Street Bank and Trust, as Transfer Agent,
relating to Schroder Enhanced Income Fund (see Note 10).

(v) Form of Letter to State Street Bank and Trust, as Transfer Agent,
relating to Schroder Total Return Fixed Income Fund (formerly, Schroder U.S.
Core Fixed Income Fund and Schroder Fixed Income Fund) (see Note 11).

(vi) Form of Amendment to Transfer Agent and Service Agreement between
State Street Bank and Trust Company and the Trust dated September 1, 2005 (see
Note 15).

(vii) Form of Letter to State Street Bank and Trust, as Transfer Agent,
relating to Schroder Global Equity Yield Fund, Schroder Global Opportunities
Fund, Schroder Emerging Market Equity Fund, Schroder Strategic Bond Fund, and
Schroder U.S. Small and Mid Cap Opportunities Fund (see Note 15).

(viii) Administration and Accounting Agreement among the Trust, Schroder
Fund Advisors Inc. and SEI Investments Global Fund Services dated as of October
8, 2001 ("SEI Administration Agreement") (see Note 5).

(ix) Form of Amendment No. 1 to the SEI Administration Agreement (see Note
8).

(x) Form of Amendment No. 2 to the SEI Administration Agreement relating to
Schroder Municipal Bond Fund and Schroder Short-Term Municipal Bond Fund (see
Note 12).

(xi) Form of Amendment No. 4 to the SEI Administration Agreement relating
to Schroder Global Equity Yield Fund, Schroder Global Opportunities Fund,
Schroder Emerging Market Equity Fund, and Schroder Strategic Bond Fund (see Note
16).

(xii) Expense Limitation Agreement between Schroder Investment Management
North America Inc. and the Trust relating to Schroder Emerging Market Equity
Fund, Schroder U.S. Small and Mid Cap Opportunities Fund, and Schroder Strategic
Bond Fund (see Note 17).

(xiii) Expense Limitation Agreement between Schroder Investment Management
North America Inc. and the Trust relating to the Schroder Enhanced Income Fund,
Schroder U.S. Core Fixed Income Fund, Schroder Municipal Bond Fund, and Schroder
Short-Term Municipal Bond Fund (see Note 16).

(xiv) Expense Limitation Agreement between Schroder Investment Management
North America Inc. and the Trust relating to the Schroder Total Return Fixed
Income Fund (formerly, Schroder U.S. Core Fixed Income Fund) (see Note 19).

(xv) Letter to State Street Bank and Trust, as Transfer Agent, relating to
Schroder International Diversified Value Fund is filed herewith.

(xvi) Amendment No. 5 to the SEI Administration Agreement relating to
Schroder International Diversified Value Fund is filed herewith.

(xvii) Expense Limitation Agreement between Schroder Investment Management
North America Inc. and the Trust relating to the Schroder International
Diversified Value Fund is filed herewith.

(i)

(i) Opinion of Ropes & Gray (see Note 3).

(ii) Opinion of Ropes & Gray LLP relating to Schroder Municipal Bond Fund,
Schroder Short-Term Municipal Bond Fund and Schroder Total Return Fixed Income
Fund (formerly, U.S. Core Fixed Income Fund and Schroder Fixed Income Fund) (see
Note 8).

(iii) Opinion of Ropes & Gray LLP relating to Schroder Enhanced Income Fund
(see Note 10).

(iv) Opinion of Ropes & Gray LLP relating to Schroder Global Equity Yield
Fund, Schroder Global Opportunities Fund, Schroder Emerging Market Equity Fund,
Schroder Strategic Bond Fund, and Schroder U.S. Small and Mid Cap Opportunities
Fund (see Note 15).

(v) Opinion of Ropes & Gray LLP relating to Schroder International
Diversified Value Fund is filed herewith.

(j) Consent of PricewaterhouseCoopers LLP is filed herewith.

(k) Not applicable.

(l) Initial Capital Agreement (see Note 1).

(m)

(i) Form of Distribution Plan and Agreement for Advisor Shares (see Note
8).

(ii) Distribution Plan and Agreement for Advisor Shares of Schroder
Enhanced Income Fund (see Note 10).

(iii) Distribution Plan and Agreement for Advisor Shares of Schroder
Municipal Bond Fund, Schroder Short-Term Municipal Bond Fund, and Schroder Total
Return Fixed Income Fund (formerly, Schroder U.S. Core Fixed Income Fund and
Schroder Fixed Income Fund) (see Note 16).

(iv) Form of Distribution Plan and Agreement for Advisor Shares of Schroder
Global Equity Yield Fund, Schroder Global Opportunities Fund, Schroder Emerging
Market Equity Fund, Schroder Strategic Bond Fund, and Schroder U.S. Small and
Mid Cap Opportunities Fund (see Note 16).

(v) Distribution Plan and Agreement for Advisor Shares of Schroder
International Diversified Value Fund is filed herewith.

(n)

(i) Third Amended and Restated Multiclass (Rule 18f-3) Plan is filed
herewith.

(o) Reserved.

(p)

(i) Code of Ethics for Schroders and Schroder Fund Advisors Inc. (see Note
13).

(ii) Code of Ethics of the Trust (see Note 13).

(iii) Code of Ethics of SIMNA Ltd. (see Note 15).

(q)

(i) Power of Attorney for David A. Dinkins, John I. Howell, Peter S.
Knight, Alan M. Mandel, Catherine A. Mazza, William L. Means, Clarence F.
Michalis, and Hermann C. Schwab (see Note 4).

(ii) Power of Attorney for Peter E. Guernsey (see Note 3).

(iii) Power of Attorney for Peter L. Clark (see Note 7).

(iv) Power of Attorney for James D. Vaughn (see Note 8).

Notes:

1. Exhibit incorporated by reference to Post-Effective Amendment No. 11 to the
Trust's Registration Statement on Form N-1A filed via EDGAR on February 25,
1999, accession number 0000950135-97-000990.

2. Exhibit incorporated by reference to Post-Effective Amendment No. 5 to the
Trust's Registration Statement on Form N-1A filed via EDGAR on April 14, 1997,
accession number 0000950135-97-012780.

3. Exhibit incorporated by reference to Post-Effective Amendment No. 12 to the
Trust's Registration Statement on Form N-1A filed via EDGAR on February 29,
2000, accession number 0000912057-009075.

4. Exhibit incorporated by reference to Post-Effective Amendment No. 14 to the
Trust's Registration Statement on Form N-1A filed via EDGAR on February 28,
2001, accession number 0000912057-01-006924.

5. Exhibit incorporated by reference to Post-Effective Amendment No. 15 to the
Trust's Registration Statement on Form N-1A filed via EDGAR on January 29, 2002,
accession number 0000950136-02-000240.

6. Exhibit incorporated by reference to Post-Effective Amendment No. 16 to the
Trust's Registration Statement on Form N-1A filed via EDGAR on February 28,
2003, accession number 0000950136-03-000458.

7. Exhibit incorporated by reference to Post-Effective Amendment No. 17 to the
Trust's Registration Statement on Form N-1A filed via EDGAR on October 17, 2003,
accession number 0000950136-03-002563.

8. Exhibit incorporated by reference to Post-Effective Amendment No. 18 to the
Trust's Registration Statement on Form N-1A filed via EDGAR on December 31,
2003, accession number 0000950136-03-003240.

9. Exhibit incorporated by reference to Post-Effective Amendment No. 19 to the
Trust's Registration Statement on Form N-1A filed via EDGAR on February 27,
2004, accession number 0000950136-04-000603.

10. Exhibit incorporated by reference to Post-Effective Amendment No. 20 to the
Trust's Registration Statement on Form N-1A filed via EDGAR on October 13, 2004,
accession number 0000950136-04-003374.

11. Exhibit incorporated by reference to Post-Effective Amendment No. 22 to the
Trust's Registration Statement on Form N-1A filed via EDGAR on October 29, 2004,
accession number 0000950136-04-003635.

12. Exhibit incorporated by reference to Post-Effective Amendment No. 23 to the
Trust's Registration Statement on Form N-1A filed via EDGAR on December 22,
2004, accession number 0000950136-04-004510.

13. Exhibit incorporated by reference to Post-Effective Amendment No. 24 to the
Trust's Registration Statement on Form N-1A filed via EDGAR on February 25,
2005, accession number 0000950136-05-001049.

14. Exhibit incorporated by reference to Post-Effective Amendment No. 25 to the
Trust's Registration Statement on Form N-1A filed via EDGAR on April 20, 2005,
accession number 0000950136-05-002183.

15. Exhibit incorporated by reference to Post-Effective Amendment No. 26 to the
Trust's Registration Statement on Form N-1A filed via EDGAR on January 11, 2006,
accession number 0000950136-06-000150.

16. Exhibit incorporated by reference to Post-Effective Amendment No. 27 to the
Trust's Registration Statement on Form N-1A filed via EDGAR on February 28,
2006, accession number 0000950136-06-001487.

17. Exhibit incorporated by reference to Post-Effective Amendment No. 28 to the
Trust's Registration Statement on Form N-1A filed via EDGAR on March 30, 2006,
accession number 0000950136-06-002515.

18. Exhibit incorporated by reference to Post-Effective Amendment No. 31 to the
Trust's Registration Statement on Form N-1A filed via EDGAR on July 21, 2006,
0000950136-06-005905.

19. Exhibit incorporated by reference to Post-Effective Amendment No. 33 to the
Trust's Registration Statement on Form N-1A filed via EDGAR on August 29, 2006,
accession number 0000950136-06-007132.

ITEM 24. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH THE FUNDS

None.

ITEM 25. INDEMNIFICATION

Article VIII of the Registrant's Agreement and Declaration of Trust provides as
follows:

SECTION 1. The Trust shall indemnify each of its Trustees and officers
(including persons who serve at the Trust's request as directors, officers or
trustees of another organization in which the Trust has any interest as a
shareholder, creditor or otherwise) (hereinafter referred to as a "Covered
Person") against all liabilities and expenses, including but not limited to
amounts paid in satisfaction of judgments, in compromise or as fines and
penalties, and counsel fees reasonably incurred by any Covered Person in
connection with the defense or disposition of any action, suit or other
proceeding, whether civil or criminal, before any court or administrative or
legislative body, in which such Covered Person may be or may have been involved
as a party or otherwise or with which such Covered Person may be or may have
been threatened, while in office or thereafter, by reason of being or having
been such a Covered Person except with respect to any matter as to which such
covered Person shall have been finally adjudicated in any such action, suit or
other proceeding (a) not to have acted in good faith in the reasonable belief
that such Covered Person's action was in the best interests of the Trust or (b)
to be liable to the Trust or it's Shareholders by reason of willful misfeasance,
bad faith, gross negligence or reckless disregard of the

duties involved in the conduct of such Covered Person's office. Expenses,
including counsel fees so incurred by any such Covered Person (but excluding
amounts paid in satisfaction of judgments, in compromise or as fines or
penalties), shall be paid from time to time by the Trust in advance of the final
disposition of any such action, suit or proceeding upon receipt of an
undertaking by or on behalf of such Covered Person to repay amounts so paid to
the Trust if it is ultimately determined that indemnification of such expenses
is not authorized under this Article, provided, however, that either (a) such
Covered Person shall have provided appropriate security for such undertaking,
(b) the Trust shall be insured against losses arising from any such advance
payments or (c) either a majority of the disinterested Trustees acting on the
matter (provided that a majority of the disinterested Trustees' then in office
act on the matter), or independent legal counsel in a written opinion, shall
have determined, based upon a review of readily available facts (as opposed to a
full trial type inquiry), that there is reason to believe that such Covered
Person will be found entitled to indemnification under this Article.

SECTION 2. As to any matter disposed of (whether by a compromise payment,
pursuant to a consent decree or otherwise) without an adjudication by a court,
or by any other body before which the proceeding was brought, that such Covered
Person either (a) did not act in good faith in the reasonable belief that his or
her action was in the best interests of the Trust or (b) is liable to the Trust
or its Shareholders by reason of willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct of his or
her office, indemnification shall be provided if (a) approved as in the best
interests of the Trust, after notice that it involves such indemnification, by
at least a majority of the disinterested Trustees acting on the matter (provided
that a majority of the disinterested Trustees then in office act on the matter)
upon a determination, based upon a review of readily available facts (as opposed
to a full trial type inquiry) that such Covered Person acted in good faith in
the reasonable belief that his or her action was in the best interests of the
Trust and is not liable to the Trust or its Shareholders by reason of willful
misfeasance, bad faith, gross negligence or reckless disregard of the duties
involved in the conduct of his or her office, or (b) there has been obtained an
opinion in writing of independent legal counsel, based upon a review of readily
available facts as opposed to a full trial type inquiry), to the effect that
such Covered Person appears to have acted in good faith in the reasonable belief
that his or her action was in the best interests of the Trust and that such
indemnification would not protect such Covered Person against any liability to
the Trust to which he or she would otherwise be subject by reason of willful
misfeasance, bad faith, gross negligence or reckless disregard of the duties
involved in the conduct of his or her office. Any approval pursuant to this
Section shall not prevent the recovery, from any Covered Person of any amount
paid to such Covered Person in accordance with this Section as indemnification
if such Covered Person is subsequently adjudicated by a court of competent
jurisdiction not to have acted in good faith in the reasonable belief that such
Covered Person's action was in the best interests of the Trust or to have been
liable to the Trust of its Shareholders by reason of willful misfeasance, bad
faith, gross negligence or reckless disregard of the duties involved in the
conduct of such Covered Person's Office.

SECTION 3. The right of indemnification hereby provided shall not be exclusive
of or affect any other rights to which such Covered Person may be entitled. As
used in this Article VIII, the term "Covered Person" shall include such person's
heirs, executors and administrators, and a "disinterested Trustee" is a Trustee
who is not an "interested person" of the Trust as defined in Section 2(a)(19) of
the 1940 Act (or who has been exempted from being an "interested person" by any
rule, regulation or order of the Securities and Exchange Commission) and against
whom none of such actions, suits or other proceedings or another action, suit or
other proceeding on the same or similar grounds is then or has been pending.

Nothing contained in this Article shall affect any rights to indemnification to
which personnel of the Trust, other than Trustees or officers, and other persons
may be entitled by contract or otherwise under law, nor the power of the Trust
to purchase and maintain liability insurance on behalf of any such person.

----------

Article 12 of the Registrant's Amended Bylaws provides as follows:

12.1 EFFECT OF AUDIT COMMITTEE FINANCIAL EXPERT DESIGNATION. The conduct of a
Trustee shall be evaluated solely by reference to a hypothetical reasonable
person, without regard to any special expertise, knowledge or other
qualifications of the Trustee. In particular, and without limiting the
generality of the foregoing, neither the determination that a Trustee is an
"audit committee financial expert" nor the knowledge, experience or other
qualifications underlying such a determination shall result in that Trustee
being held to a standard of care that is higher than the standard that would be
applicable in the absence of such a determination or such knowledge, experience
or qualification, nor shall such a determination or such knowledge, experience
or other qualification impose any duties, obligations or liabilities that are
greater than would obtain in the absence of such a determination or such
knowledge, experience or qualification. Any determination of whether a Trustee
has complied with any applicable standard of care, including without limitation
any standard of care set out in any constituent document of the Trust, and any
determination of whether a Trustee shall be entitled to indemnification pursuant
to any provision of the Declaration of Trust or these Bylaws, shall be made in
light of and based upon the provisions of this paragraph, and any person serving
as Trustee, whether at the date of adoption of this paragraph as a Bylaw or
thereafter, shall be presumed conclusively to have done so in reliance on this
paragraph. No amendment or removal of this paragraph shall be effective in
respect of any period prior to such amendment or removal.

12.2. MANDATORY INDEMNIFICATION OF TRUSTEES. The Trust shall to the fullest
extent legally permissible indemnify each person who is or was a Trustee against
all liabilities, costs and expenses reasonably incurred by such person in
connection with or resulting from any action, suit or proceeding, whether civil,
criminal, administrative or investigative, brought by any governmental or
self-regulatory authority, including without limitation any formal or informal
investigation into possible violations of law or regulation initiated by any
governmental body or self-regulatory authority, in which such person may be or
may have been involved as a party or otherwise or with which he may be or may
have been threatened, while in office or thereafter, by reason of he or she
having been a Trustee, or by reason of any action taken or not taken in such
capacity, except to the extent prohibited by the Declaration of Trust. Any
person serving as Trustee, whether at the date of adoption of this paragraph as
a Bylaw or thereafter, shall be presumed conclusively to have done so in
reliance on this paragraph. No amendment or removal of this paragraph shall be
effective in respect of any period prior to such amendment or removal or any
proceeding related to any period prior to such amendment or removal.

----------

Reference is made to the Distribution Agreement, filed herewith, which contains
provisions for the indemnification by Schroder Fund Advisors Inc. of the
Registrant and Trustees and officers of the Registrant under certain
circumstances. Insofar as indemnification for liability arising under the
Securities Act of 1933 may be permitted to Trustees and officers of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a Trustee or officer of the Registrant in the successful defense of
any action, suit, or proceeding) is asserted by such Trustee or officer in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.

ITEM 26. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER

The directors and officers of the Registrant's investment adviser, Schroder
Investment Management North America Inc. ("Schroders"), have been engaged during
the past two fiscal years in no business, vocation, or employment of a
substantial nature other than as directors, officers, or employees of the
investment adviser or certain of its corporate affiliates, except the following,
whose principal occupations

during that period, other than as directors or officers of the investment
adviser or certain of its corporate affiliates, are as follows: Christopher
Cook, Senior Vice President of Schroders, who was formerly an SR Institutional
Account Executive at Strong Capital Management; Anthony Williams, Senior Vice
President of Schroders, who was formerly Vice President and Institutional Sales
Manager at AmSouth Asset Management, prior to that Relationship Manager at
Dresdner RCM Global Investors; John Eric Nelson, Senior Vice President of
Schroders, who was formerly a Managing Director at Merrill Lynch Investment
Managers; John Harrington, Senior Vice President of Schroders, who was formerly
a Product Manager and Portfolio Manager at Wellington Management; Virginie
Maisonneuve, Director of Schroders, who was formerly a Director and Co-Chief
Investment Officer at Clay Finlay; Steven Johnson, Executive Vice President of
Schroders, who was formerly Director of North American Business at Marathon
Asset Management; Robert Formisano, Senior Vice President of Schroders, who was
formerly Director of Sales and Client Service at West AM; Allan Conway,
Executive Vice President of Schroders, who was formerly Head of Global Emerging
Markets for West LB Asset Management; E. Ross Servick, Senior Vice President of
Schroders, who was formerly Senior Vice President at Managers Investment Group;
and William MacCarter Sims, Senior Vice President of Schroders, who was formerly
a Managing Director of Specialty Distribution at Columbia Management Group..

The address of Schroders and Schroder Fund Advisors Inc. is 875 Third Avenue,
22nd Floor, New York, NY 10022. The addresses of certain corporate affiliates of
Schroders are as follows: Schroder Investment Management North America Limited,
Schroder Ltd., and Schroders plc. are located at 31 Gresham St., London EC2V
7QA, United Kingdom. Each of Schroder Investment Management Limited, Schroder
Investment Management (UK) Limited, Schroder Investment Management (Europe),
Korea Schroder Fund Management Limited and Schroder Personal Investment
Management, is located at 33 Gutter Lane, London EC2V 8AS United Kingdom.
Schroder Investment Management (Singapore) Limited is located at #47-01 OCBC
Centre, Singapore. Schroder Investment Management (Hong Kong) Limited is located
at 8 Connaight Place, Hong Kong. Schroder Investment Management (Australasia)
Limited is located at 225 George Place, Sydney, Australia. PT Schroder
Investment Management Indonesia is located at Lippo Plaza Bldg., 25 Jakarta,
12820. Schroders (C.I.) Limited is located at St. Peter Port, Guernsey, Channel
Islands, GY1 3UF. Schroder Properties Limited is located at Senator House, 85
Queen Victoria Street, London EC4V 4EJ, United Kingdom.

ITEM 27. PRINCIPAL UNDERWRITERS

(a) Schroder Fund Advisors Inc. currently acts as the principal underwriter for
each series of Registrant, each series of Schroder Capital Funds (Delaware) and
each series of Schroder Global Series Trust.

(b) The directors and officers of the Registrant's principal underwriter are as
follows:

Name and Principal Business Position and Office with Position and Office
Address* Underwriter with the Trust
--------------------------- -------------------------- ---------------------
Catherine A. Mazza Director and President None

Mark A. Hemenetz Director and Chairman President and
Principal Executive
Officer
Alan M. Mandel Director, Treasurer, Chief Treasurer, Principal
Operating Officer Financial and
Accounting Officer
Mark J. Smith Director and Senior Vice None
President
Carin F. Muhlbaum Director, Senior Vice Vice President and
President, Secretary and Clerk
General Counsel
Steven N. Johnson Director and Chief None
Compliance Officer
Stephen DeTore Director and Senior Vice Chief Compliance
President Officer

Angel Lanier Assistant Vice President Assistant Secretary

* The principal business address of each individual listed above is 875 Third
Avenue, 22nd Floor, New York, New York 10022, except for Mark J. Smith,
whose business address is 31 Gresham St., London EC2V 7QA, United Kingdom.

ITEM 28. LOCATION OF ACCOUNTS AND RECORDS

Persons maintaining physical possession of accounts, books, and other documents
required to be maintained by Section 31(a) of the Investment Company Act of 1940
and the Rules promulgated thereunder are Registrant's Clerk, Carin F. Muhlbaum;
Registrant's investment adviser, Schroder Investment Management North America
Inc.; Registrant's custodian, J.P. Morgan Chase Bank; and Registrant's transfer
agent and registrar, Boston Financial Data Services, Inc. The address of the
clerk and investment adviser is 875 Third Avenue, 22nd Floor, New York, New York
10022.

The address of the custodian is 270 Park Avenue, New York, New York 10017. The
address of the transfer agent and registrar is Two Heritage Drive, Quincy,
Massachusetts 02171.

ITEM 29. MANAGEMENT SERVICES

None.

ITEM 30. UNDERTAKINGS

(a) The Registrant undertakes to furnish each person to whom a prospectus is
delivered with a copy of the Registrant's latest annual report to shareholders
upon request and without charge.

(b) The Registrant undertakes, if requested to do so by the holders of at least
10% of the Registrant's outstanding shares of beneficial interest, to call a
meeting of shareholders for the purpose of voting upon the question of removal
of a Trustee or Trustees and to assist, in communications with other
shareholders as required by Section 16(c) of the Investment Company Act of 1940.

NOTICE

A copy of the Agreement and Declaration of Trust of Schroder Series Trust is on
file with the Secretary of State of The Commonwealth of Massachusetts, and
notice is hereby given that this instrument is executed on behalf of the
Registrant by an officer of the Registrant as an officer and not individually
and that the obligations of or arising out of this instrument are not binding
upon any of the Trustees, officers, or shareholders individually but are binding
only upon the assets and property of the Registrant.

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended, and the
Investment Company Act of 1940, the Registrant certifies that it meets all the
requirements for effectiveness of this registration statement under Rule 485(b)
under the Securities Act and has duly caused this Registration Statement to be
signed on its behalf by the undersigned, thereto duly authorized, in the City of
New York and the State of New York, on this 29th of August, 2006.

SCHRODER SERIES TRUST

By: /s/ Mark A. Hemenetz
--------------------------------------------------------
Name: Mark A. Hemenetz
Title: President and Principal Executive Officer

Pursuant to the requirements of the Securities Act of 1933, as amended, this
Amendment to the Registration Statement has been signed below by the following
persons in the capacities indicated on August 29, 2006.

Principal Executive Officer

By: /s/ Mark A. Hemenetz
--------------------------------------------------------
Name: Mark A. Hemenetz
Title: President and Principal Executive Officer

Principal Financial and Accounting Officer

By: /s/ Alan M. Mandel
--------------------------------------------------------
Name: Alan M. Mandel
Title: Treasurer, Principal Financial and Accounting Officer

*Peter L. Clark, Trustee
*David N. Dinkins, Trustee
*Peter E. Guernsey, Trustee
*John I. Howell, Trustee
*Peter S. Knight, Trustee
*William L. Means, Trustee
*Clarence F. Michalis, Trustee
*Hermann C. Schwab, Trustee
*James D. Vaughn, Trustee

By: /s/ Alan M. Mandel
--------------------------------------------------------
Alan M. Mandel Attorney-in-Fact*

* Pursuant to powers of attorney previously filed as exhibits to this
Registration Statement.

EXHIBIT INDEX

(d)(v) Management Contract

(d)(vi) Investment Subadvisory Agreement

(g)(iv) Fifth Amended and Restated Exhibit B to Global Custody Agreement

(h)(xv) Letter to State Street Bank and Trust, as Transfer Agent

(h)(xvi) Amendment No. 5 to the SEI Administration Agreement

(h)(xvii) Expense Limitation Agreement

(i)(v) Opinion of Ropes & Gray LLP

(j) Consent of PricewaterhouseCoopers LLP

(m)(v) Distribution Plan

(n)(i) Third Amended and Restated Multiclass (18f-3) Plan