UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM N-CSR/A

 

CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES

 

Investment Company Act file number

811-21217

 

Eaton Vance Insured California Municipal Bond Fund II

(Exact name of registrant as specified in charter)

 

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

 

02109

(Address of principal executive offices)

 

(Zip code)

 

Alan R. Dynner

The Eaton Vance Building, 255 State Street, Boston, Massachusetts 02109

(Name and address of agent for service)

 

Registrant’s telephone number, including area code:

(617) 482-8260

 

 

Date of fiscal year end:

September 30

 

 

Date of reporting period:

September 30, 2006

 

 

This Form N-CSR/A amends the Form N-CSR of the registrant for the fiscal year and reporting period ended September 30, 2006 filed with the Securities and Exchange Commission on December 7, 2006. Due to a recent discovery of accounting issues related to financial statement presentation of derivative instruments commonly known as inverse floaters, the financial statements contained in registrant’s annual report to shareholders for the fiscal year ended September 30, 2006 have been restated to reflect a revised presentation of such instruments.




Item 1. Reports to Stockholders




Annual Report September 30, 2006 (As Restated)

EATON VANCE
INSURED
MUNICIPAL
BOND
FUNDS

CLOSED-END FUNDS:

Insured Municipal II

Insured California II

Insured Florida

Insured Massachusetts

Insured Michigan

Insured New Jersey

Insured New York II

Insured Ohio

Insured Pennsylvania



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

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

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

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

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

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

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

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

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

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

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

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

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

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

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




 

Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

 

TABLE OF CONTENTS

 

Management’s Discussion of Fund Performance

 

2

 

 

 

Performance Information and Portfolio Composition (As Restated)

 

 

 

 

 

Insured Municipal Bond Fund II

 

3

Insured California Municipal Bond Fund II

 

4

Insured Florida Municipal Bond Fund

 

5

Insured Massachusetts Municipal Bond Fund

 

6

Insured Michigan Municipal Bond Fund

 

7

Insured New Jersey Municipal Bond Fund

 

8

Insured New York Municipal Bond Fund II

 

9

Insured Ohio Municipal Bond Fund

 

10

Insured Pennsylvania Municipal Bond Fund

 

11

 

 

 

Financial Statements (As Restated)

 

12

 

 

 

Federal Tax Information

 

72

 

 

 

Dividend Reinvestment Plan

 

73

 

 

 

Board of Trustees’ Annual Approval of the Investment Advisory Agreements

 

75

 

 

 

Management and Organization

 

78

 

1



 

Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

 

MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE

 

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

 

As discussed in Note 11 to the Funds’ financial statements, the Funds’ financial statements have been restated. The accompanying management’s discussion of fund performance gives effect to that restatement.

 

Economic and Market Conditions

 

Third quarter economic growth slowed to 1.6%, following the 2.6% growth rate achieved in the second quarter. With higher mortgage rates in the market, led largely by the persistent Federal Reserve (the “Fed”) tightening, the housing market continued to soften, with building permits and existing home sales leading the way. However, energy prices declined significantly in the quarter, somewhat offsetting the impact of a weakening housing market. The economy continued to create jobs over the period, with the unemployment rate standing at 4.6% as of September 30, 2006.

 

Inflation expectations moderated with the lower energy prices, although the core Consumer Price Index – measured on a year-over-year basis – has demonstrated a slow but steady rise. The Fed, which raised short-term rates 17 times since June 2004, is currently in a pausing mode, awaiting further economic inputs to determine the future direction of interest rate moves. At September 30, 2006, the Federal Funds rate stood at 5.25%.

 

Municipal market supply for the first half of the year was lower than that experienced in 2005. As a result, municipals have generally outperformed Treasury bonds for the year ended September 30, 2006, as demand has remained strong. At September 30, 2006, long-term AAA-rated, insured municipal bonds yielded 90% of U.S. Treasury bonds with similar maturities.*

 

For the year ended September 30, 2006, the Lehman Brothers Municipal Bond Index† (the “Index”), an unmanaged index of municipal bonds, posted a gain of 4.45%. For more information about each Fund’s performance and that of funds in the same Lipper Classification†, see the Performance Information and Portfolio Composition pages that follow.

 

Management Discussion

 

The Funds invest primarily in bonds with stated maturities of 10 years or longer, as longer-maturity bonds historically have provided greater tax-exempt income for investors than shorter-maturity bonds. Given the flattening of the yield curve for other fixed-income securities over the past 18 months — with shorter-maturity yields rising more than longer-maturity yields — management felt that the long end of the municipal curve was a relatively attractive place to be positioned. However, given the leveraged nature of the Funds, rising short-term rates have increased the borrowing costs associated with the leverage. As borrowing costs have risen, the income generated by the Funds has declined. Please see the Performance Information and Portfolio Composition pages that follow for a description of each Fund’s leverage as of September 30, 2006.

 

Because of the mixed economic backdrop of contained inflation expectations, a weakened housing market and continued growth in the labor market, Fund management continued to maintain a somewhat cautious outlook on interest rates. In this environment, Fund management continued to focus on finding relative value within the marketplace – in issuer names, coupons, maturities and sectors. Relative value trading, which seeks to capitalize on undervalued securities, has enhanced the Funds’ returns during the period.

 


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

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

Past performance is no guarantee of future results.

 

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

 

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

 

2



 

Eaton Vance Insured Municipal Bond Fund II as of September 30, 2006

 

PERFORMANCE INFORMATION AND PORTFOLIO COMPOSITION

 

Fund Performance as of 9/30/06(1)

 

Average Annual Total Return (by share price, American Stock Exchange)

 

 

 

One Year

 

0.13

%

Life of Fund (11/29/02)

 

8.59

 

 

Average Annual Total Return (by net asset value)

 

 

 

One Year

 

9.56

%

Life of Fund (11/29/02)

 

9.60

 

 

Market Yields

 

 

 

 

 

 

 

Market Yield(2)

 

5.10

%(4)

Taxable Equivalent Market Yield(3)

 

7.85

(4)

 

Index Performance(5)

 

 

 

 

 

 

 

Lehman Brothers Municipal Bond Index - Average Annual Total Returns

 

 

 

One Year

 

4.45

%

Life of Fund (11/30/02)

 

5.00

 

 

Lipper Averages(6)

 

 

 

 

 

 

 

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

 

 

 

One Year

 

5.12

%

Life of Fund (11/30/02)

 

6.27

 

 

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

 

Portfolio Manager: William H. Ahern, CFA

 

Rating Distribution*(7),(8)

 

By total investments

 

GRAPHIC

 

*The rating distribution presented above includes the ratings of securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1B to the Fund’s financial statements. Absent such securities, the Fund’s rating distribution at September 30, 2006 is as follows:

 

AAA

 

87.5

%

BBB

 

2.7

%

AA

 

3.9

%

 

 

 

 

A

 

5.9

%

 

 

 

 

 

Leverage: 35.2%

 

The leverage amount is Auction Preferred Shares at liquidation value as a percentage of the Fund’s total assets excluding assets and floating rate notes payable deemed held pursuant to FAS Statement 140. The Fund uses leverage through the issuance of preferred shares. Use of financial leverage creates an opportunity for increased income but, at the same time, creates special risks (including the likelihood of greater volatility of net asset value and market price of common shares).

 


(1) Returns are historical and are calculated by determining the percentage change in share price or net asset value with all distributions reinvested. The Fund’s performance at market share price will differ from its results at NAV. Although share price performance generally reflects investment results over time, during shorter periods, returns at share price can also be affected by factors such as changing perceptions about the Fund, market conditions, fluctuations in supply and demand for the Fund’s shares, or changes in Fund distributions. Performance results reflect the effect of leverage resulting from the Fund’s issuance of Auction Preferred Shares. (2) The Fund’s market yield is calculated by dividing the last dividend per share of the fiscal year by the share price at the end of the fiscal year and annualizing the result.(3) Taxable-equivalent figure assumes a maximum 35.00% federal income tax rate. A lower tax rate would result in a lower tax-equivalent figure. (4) The dividend declared on October 31, 2006 reflects a reduction of the monthly dividend of $0.001667 per share. (5) It is not possible to invest directly in an Index. The Index’s total return does not reflect the expenses that would have been incurred if an investor individually purchased or sold the securities represented in the Index. Index performance is available as of month end only. (6) The Lipper Averages are the average total returns at net asset value of the funds that are in the same Lipper Classification as the Fund. It is not possible to invest in a Lipper Classification. Lipper Classifications may include insured and uninsured funds, as well as leveraged and unleveraged funds. The Lipper Insured Municipal Debt Funds (Leveraged) Classification (closed end) contained 26 funds for the 1-year and Life-of-Fund time periods. Lipper Averages are available as of month end only. (7) As of 9/30/06. Rating Distribution is determined by dividing the total market value of the issues by the total investments of the Fund. (8) As of 9/30/06. Portfolio holdings information includes securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1B to the Fund’s financial statements. Portfolio information may not be representative of the Fund’s current or future investments and may change due to active management.

 

3



 

Eaton Vance Insured California Municipal Bond Fund II as of September 30, 2006

 

PERFORMANCE INFORMATION AND PORTFOLIO COMPOSITION

 

Fund Performance as of 9/30/06(1)

 

Average Annual Total Return (by share price, American Stock Exchange)

 

 

 

One Year

 

4.49

%

Life of Fund (11/29/02)

 

6.85

 

 

Average Annual Total Return (by net asset value)

 

 

 

One Year

 

9.15

%

Life of Fund (11/29/02)

 

8.15

 

 

Market Yields

 

Market Yield(2)

 

4.96

%

Taxable Equivalent Market Yield(3)

 

8.41

 

 

Index Performance(4)

 

Lehman Brothers Municipal Bond Index - Average Annual Total Returns

 

 

 

One Year

 

4.45

%

Life of Fund (11/30/02)

 

5.00

 

 

Lipper Averages(5)

 

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

 

 

 

One Year

 

5.80

%

Life of Fund (11/30/02)

 

6.53

 

 

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

 

Portfolio Manager: Cynthia J. Clemson

 

Rating Distribution*(6),(7)

 

By total investments

 

GRAPHIC

 

*The rating distribution presented above includes the ratings of securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1B to the Fund’s financial statements. Absent such securities, the Fund’s rating distribution at September 30, 2006 is as follows:

 

AAA

 

84.3

%

AA

 

2.7

%

A

 

13

%

 

Leverage: 36.2%

 

The leverage amount is Auction Preferred Shares at liquidation value as a percentage of the Fund’s total assets excluding assets and floating rate notes payable deemed held pursuant to FAS Statement 140. The Fund uses leverage through the issuance of preferred shares. Use of financial leverage creates an opportunity for increased income but, at the same time, creates special risks (including the likelihood of greater volatility of net asset value and market price of common shares).

 


(1) Returns are historical and are calculated by determining the percentage change in share price or net asset value with all distributions reinvested. The Fund’s performance at market share price will differ from its results at NAV. Although share price performance generally reflects investment results over time, during shorter periods, returns at share price can also be affected by factors such as changing perceptions about the Fund, market conditions, fluctuations in supply and demand for the Fund’s shares, or changes in Fund distributions. Performance results reflect the effect of leverage resulting from the Fund’s issuance of Auction Preferred Shares. (2) The Fund’s market yield is calculated by dividing the last dividend per share of the fiscal year by the share price at the end of the fiscal year and annualizing the result. (3) Taxable-equivalent figure assumes a maximum 41.05% combined federal and state income tax rate. A lower tax rate would result in a lower tax-equivalent figure. (4) It is not possible to invest directly in an Index. The Index’s total return does not reflect the expenses that would have been incurred if an investor individually purchased or sold the securities represented in the Index. Index performance is available as of month end only. (5) The Lipper Averages are the average total returns at net asset value of the funds that are in the same Lipper Classification as the Fund. It is not possible to invest in a Lipper Classification. Lipper Classifications may include insured and uninsured funds, as well as leveraged and unleveraged funds. The Lipper California Insured Municipal Debt Funds Classification (closed end) contained 13 funds for the 1-year and Life-of-Fund time periods. Lipper Averages are available as of month end only. (6) As of 9/30/06. Rating Distribution is determined by dividing the total market value of the issues by the total investments of the Fund. (7) As of 9/30/06. Portfolio holdings information includes securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1B to the Fund’s financial statements. Portfolio information may not be representative of the Fund’s current or future investments and may change due to active management.

 

4



 

Eaton Vance Insured Florida Municipal Bond Fund as of September 30, 2006

 

PERFORMANCE INFORMATION AND PORTFOLIO COMPOSITION

 

Fund Performance as of 9/30/06(1)

 

Average Annual Total Return (by share price, American Stock Exchange)

 

 

 

One Year

 

1.37

%

Life of Fund (11/29/02)

 

6.35

 

 

Average Annual Total Return (by net asset value)

 

 

 

One Year

 

7.64

%

Life of Fund (11/29/02)

 

7.82

 

 

Market Yields

 

 

 

 

 

 

 

Market Yield(2)

 

4.93

%(4)

Taxable Equivalent Market Yield(3)

 

7.58

(4)

 

Index Performance(5)

 

 

 

 

 

 

 

Lehman Brothers Municipal Bond Index - Average Annual Total Returns

 

 

 

One Year

 

4.45

%

Life of Fund (11/30/02)

 

5.00

 

 

 

 

 

 

Lipper Averages(6)

 

 

 

 

 

 

 

Lipper Florida Municipal Debt Funds Classification - Average Annual Total Returns

 

 

 

One Year

 

5.28

%

Life of Fund (11/30/02)

 

6.53

 

 

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

 

Portfolio Manager: Craig R. Brandon, CFA

 

Rating Distribution*(7),(8)

 

By total investments

 

GRAPHIC

 

*The rating distribution presented above includes the ratings of securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1B to the Fund’s financial statements. Absent such securities, the Fund’s rating distribution at September 30, 2006 is as follows:

 

AAA

 

91.0%

AA

 

1.7%

A

 

7.3%

 

Leverage: 36.3%

 

The leverage amount is Auction Preferred Shares at liquidation value as a percentage of the Fund’s total assets excluding assets and floating rate notes payable deemed held pursuant to FAS Statement 140. The Fund uses leverage through the issuance of preferred shares. Use of financial leverage creates an opportunity for increased income but, at the same time, creates special risks (including the likelihood of greater volatility of net asset value and market price of common shares).

 


(1) Returns are historical and are calculated by determining the percentage change in share price or net asset value with all distributions reinvested. The Fund’s performance at market share price will differ from its results at NAV. Although share price performance generally reflects investment results over time, during shorter periods, returns at share price can also be affected by factors such as changing perceptions about the Fund, market conditions, fluctuations in supply and demand for the Fund’s shares, or changes in Fund distributions. Performance results reflect the effect of leverage resulting from the Fund’s issuance of Auction Preferred Shares. (2) The Fund’s market yield is calculated by dividing the last dividend per share of the fiscal year by the share price at the end of the fiscal year and annualizing the result. (3) Taxable-equivalent figure assumes a maximum 35.00% federal income tax rate. A lower tax rate would result in a lower tax-equivalent figure. (4) The dividend declared on October 31, 2006 reflects a reduction of the monthly dividend of $0.002917 per share. (5) It is not possible to invest directly in an Index. The Index’s total return does not reflect the expenses that would have been incurred if an investor individually purchased or sold the securities represented in the Index. Index performance is available as of month end only. (6) The Lipper Averages are the average total returns at net asset value of the funds that are in the same Lipper Classification as the Fund. It is not possible to invest in a Lipper Classification. Lipper Classifications may include insured and uninsured funds, as well as leveraged and unleveraged funds. The Lipper Florida Municipal Debt Funds Classification (closed end) contained 17 and 16 funds for the 1-year and Life-of-Fund time periods, respectively. Lipper Averages are available as of month end only. (7) As of 9/30/06. Rating Distribution is determined by dividing the total market value of the issues by the total investments of the Fund. (8) As of 9/30/06. Portfolio holdings information includes securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1B to the Fund’s financial statements. Portfolio information may not be representative of the Fund’s current or future investments and may change due to active management.

 

5



 

Eaton Vance Insured Massachusetts Municipal Bond Fund as of September 30, 2006

 

PERFORMANCE INFORMATION AND PORTFOLIO COMPOSITION

 

Fund Performance as of 9/30/06(1)

 

Average Annual Total Return (by share price, American Stock Exchange)

 

 

 

One Year

 

-2.28

%

Life of Fund (11/29/02)

 

9.63

 

 

Average Annual Total Return (by net asset value)

 

 

 

One Year

 

9.14

%

Life of Fund (11/29/02)

 

8.82

 

 

Market Yields

 

 

 

 

 

 

 

Market Yield(2)

 

4.52

%(4)

Taxable Equivalent Market Yield(3)

 

7.34

(4)

 

Index Performance(5)

 

 

 

 

 

 

 

Lehman Brothers Municipal Bond Index - Average Annual Total Returns

 

 

 

One Year

 

4.45

%

Life of Fund (11/30/02)

 

5.00

 

 

Lipper Averages(6)

 

 

 

 

 

 

 

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

 

 

 

One Year

 

5.34

%

Life of Fund (11/30/02)

 

7.12

 

 

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

 

Portfolio Manager: Robert B. MacIntosh, CFA

 

Rating Distribution*(7),(8)

 

By total investments

 

GRAPHIC

 

* The rating distribution presented above includes the ratings of securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1B to the Fund’s financial statements. Absent such securities, the Fund’s rating distribution at September 30, 2006 is as follows:

 

AAA

 

86.0

%

BBB

 

4.6

%

AA

 

5.1

%

 

 

 

 

A

 

4.3

%

 

 

 

 

 

Leverage: 36.1%

 

The leverage amount is Auction Preferred Shares at liquidation value as a percentage of the Fund’s total assets excluding assets and floating rate notes payable deemed held pursuant to FAS Statement 140. The Fund uses leverage through the issuance of preferred shares. Use of financial leverage creates an opportunity for increased income but, at the same time, creates special risks (including the likelihood of greater volatility of net asset value and market price of common shares).

 


(1) Returns are historical and are calculated by determining the percentage change in share price or net asset value with all distributions reinvested. The Fund’s performance at market share price will differ from its results at NAV. Although share price performance generally reflects investment results over time, during shorter periods, returns at share price can also be affected by factors such as changing perceptions about the Fund, market conditions, fluctuations in supply and demand for the Fund’s shares, or changes in Fund distributions. Performance results reflect the effect of leverage resulting from the Fund’s issuance of Auction Preferred Shares. (2) The Fund’s market yield is calculated by dividing the last dividend per share of the fiscal year by the share price at the end of the fiscal year and annualizing the result. (3) Taxable-equivalent figure assumes a maximum 38.45% combined federal and state income tax rate. A lower tax rate would result in a lower tax-equivalent figure. (4) The dividend declared on October 31, 2006 reflects a reduction of the monthly dividend of $0.003333 per share. (5) It is not possible to invest directly in an Index. The Index’s total return does not reflect the expenses that would have been incurred if an investor individually purchased or sold the securities represented in the Index. Index performance is available as of month end only. (6) The Lipper Averages are the average total returns at net asset value of the funds that are in the same Lipper Classification as the Fund. It is not possible to invest in a Lipper Classification. Lipper Classifications may include insured and uninsured funds, as well as leveraged and unleveraged funds. The Lipper Other States Municipal Debt Funds Classification (closed end) contained 46 funds for the 1-year and Life-of-Fund time periods, respectively. Lipper Averages are available as of month end only. (7) As of 9/30/06. Rating Distribution is determined by dividing the total market value of the issues by the total investments of the Fund. (8) As of 9/30/06. Portfolio holdings information includes securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1B to the Fund’s financial statements. Portfolio information may not be representative of the Fund’s current or future investments and may change due to active management.

6



 

Eaton Vance Insured Michigan Municipal Bond Fund as of September 30, 2006

 

PERFORMANCE INFORMATION AND PORTFOLIO COMPOSITION

 

Fund Performance as of 9/30/06(1)

 

Average Annual Total Return (by share price, American Stock Exchange)

 

 

 

One Year

 

-7.67

%

Life of Fund (11/29/02)

 

5.76

 

 

Average Annual Total Return (by net asset value)

 

 

 

One Year

 

8.44

%

Life of Fund (11/29/02)

 

8.09

 

 

Market Yields

 

 

 

 

 

 

 

Market Yield(2)

 

4.71

%

Taxable Equivalent Market Yield(3)

 

7.54

 

 

Index Performance(4)

 

 

 

 

 

 

 

Lehman Brothers Municipal Bond Index - Average Annual Total Returns

 

 

 

One Year

 

4.45

%

Life of Fund (11/30/02)

 

5.00

 

 

Lipper Averages(5)

 

 

 

 

 

 

 

Lipper Michigan Municipal Debt Funds Classification - Average Annual Total Returns

 

 

 

One Year

 

5.39

%

Life of Fund (11/30/02)

 

6.90

 

 

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

 

Portfolio Manager: William H. Ahern, CFA

 

Rating Distribution*(6),(7)

 

By total investments

 

 

*The rating distribution presented above includes the ratings of securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1B to the Fund’s financial statements. Absent such securities, the Fund’s rating distribution at September 30, 2006 is as follows:

 

AAA

 

82.2

%

BBB

 

1.1

%

AA

 

4.4

%

 

 

 

 

A

 

12.3

%

 

 

 

 

 

Leverage: 36.6%

 

The leverage amount is Auction Preferred Shares at liquidation value as a percentage of the Fund’s total assets excluding assets and floating rate notes payable deemed held pursuant to FAS Statement 140. The Fund uses leverage through the issuance of preferred shares. Use of financial leverage creates an opportunity for increased income but, at the same time, creates special risks (including the likelihood of greater volatility of net asset value and market price of common shares).

 


(1) Returns are historical and are calculated by determining the percentage change in share price or net asset value with all distributions reinvested. The Fund’s performance at market share price will differ from its results at NAV. Although share price performance generally reflects investment results over time, during shorter periods, returns at share price can also be affected by factors such as changing perceptions about the Fund, market conditions, fluctuations in supply and demand for the Fund’s shares, or changes in Fund distributions. Performance results reflect the effect of leverage resulting from the Fund’s issuance of Auction Preferred Shares. (2) The Fund’s market yield is calculated by dividing the last dividend per share of the fiscal year by the share price at the end of the fiscal year and annualizing the result. (3) Taxable-equivalent figure assumes a maximum 37.54% combined federal and state income tax rate. A lower tax rate would result in a lower tax-equivalent figure. (4) It is not possible to invest directly in an Index. The Index’s total return does not reflect the expenses that would have been incurred if an investor individually purchased or sold the securities represented in the Index. Index performance is available as of month end only. (5) The Lipper Averages are the average total returns at net asset value of the funds that are in the same Lipper Classification as the Fund. It is not possible to invest in a Lipper Classification. Lipper Classifications may include insured and uninsured funds, as well as leveraged and unleveraged funds. The Lipper Michigan Municipal Debt Funds Classification (closed end) contained 7 funds for the 1-year and Life-of-Fund time periods. Lipper Averages are available as of month end only. (6) As of 9/30/06. Rating Distribution is determined by dividing the total market value of the issues by the total investments of the Fund. (7) As of 9/30/06. Portfolio holdings information includes securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1B to the Fund’s financial statements. Portfolio information may not be representative of the Fund’s current or future investments and may change due to active management.

 

7



 

Eaton Vance Insured New Jersey Municipal Bond Fund as of September 30, 2006

 

PERFORMANCE INFORMATION AND PORTFOLIO COMPOSITION

 

Fund Performance as of 9/30/06(1)

 

Average Annual Total Return (by share price, American Stock Exchange)

 

 

 

One Year

 

6.53

%

Life of Fund (11/29/02)

 

10.26

 

 

Average Annual Total Return (by net asset value)

 

 

 

One Year

 

9.65

%

Life of Fund (11/29/02)

 

9.27

 

 

Market Yields

 

 

 

 

 

 

 

Market Yield(2)

 

4.51

%(4)

Taxable Equivalent Market Yield(3)

 

7.62

(4)

 

Index Performance(5)

 

 

 

 

 

 

 

Lehman Brothers Municipal Bond Index - Average Annual Total Returns

 

 

 

One Year

 

4.45

%

Life of Fund (11/30/02)

 

5.00

 

 

Lipper Averages(6)

 

 

 

 

 

 

 

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

 

 

 

One Year

 

6.11

%

Life of Fund (11/30/02)

 

7.84

 

 

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

 

Portfolio Manager: Robert B. MacIntosh, CFA

 

Rating Distribution*(7),(8)

 

By total investments

 

GRAPHIC

 

*The rating distribution presented above includes the ratings of securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1B to the Fund’s financial statements. Absent such securities, the Fund’s rating distribution at September 30, 2006 is as follows:

 

AAA

 

83.2

%

BBB

 

11.3

%

AA

 

2.1

%

 

 

 

 

A

 

3.4

%

 

 

 

 

 

Leverage: 35.6%

 

The leverage amount is Auction Preferred Shares at liquidation value as a percentage of the Fund’s total assets excluding assets and floating rate notes payable deemed held pursuant to FAS Statement 140. The Fund uses leverage through the issuance of preferred shares. Use of financial leverage creates an opportunity for increased income but, at the same time, creates special risks (including the likelihood of greater volatility of net asset value and market price of common shares).

 


(1) Returns are historical and are calculated by determining the percentage change in share price or net asset value with all distributions reinvested. The Fund’s performance at market share price will differ from its results at NAV. Although share price performance generally reflects investment results over time, during shorter periods, returns at share price can also be affected by factors such as changing perceptions about the Fund, market conditions, fluctuations in supply and demand for the Fund’s shares, or changes in Fund distributions. Performance results reflect the effect of leverage resulting from the Fund’s issuance of Auction Preferred Shares. (2) The Fund’s market yield is calculated by dividing the last dividend per share of the fiscal year by the share price at the end of the fiscal year and annualizing the result. (3) Taxable-equivalent figure assumes a maximum 40.83% combined federal and state income tax rate. A lower tax rate would result in a lower tax-equivalent figure. (4) The dividend declared on October 31, 2006 reflects a reduction of the monthly dividend of $0.0025 per share. (5) It is not possible to invest directly in an Index. The Index’s total return does not reflect the expenses that would have been incurred if an investor individually purchased or sold the securities represented in the Index. Index performance is available as of month end only. (6) The Lipper Averages are the average total returns at net asset value of the funds that are in the same Lipper Classification as the Fund. It is not possible to invest in a Lipper Classification. Lipper Classifications may include insured and uninsured funds, as well as leveraged and unleveraged funds. The Lipper New Jersey Municipal Debt Funds Classification (closed end) contained 13 funds for the 1-year and Life-of-Fund time periods. Lipper Averages are available as of month end only. (7) As of 9/30/06. Rating Distribution is determined by dividing the total market value of the issues by the total investments of the Fund. (8) As of 9/30/06. Portfolio holdings information includes securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1B to the Fund’s financial statements. Portfolio information may not be representative of the Fund’s current or future investments and may change due to active management.

 

8



 

Eaton Vance Insured New York Municipal Bond Fund II as of September 30, 2006

 

PERFORMANCE INFORMATION AND PORTFOLIO COMPOSITION

 

Fund Performance as of 9/30/06(1)

 

Average Annual Total Return (by share price, American Stock Exchange)

 

 

 

One Year

 

4.75

%

Life of Fund (11/29/02)

 

6.84

 

 

Average Annual Total Return (by net asset value)

 

 

 

One Year

 

9.02

%

Life of Fund (11/29/02)

 

9.34

 

 

Market Yields

 

 

 

 

 

 

 

Market Yield(2)

 

4.83

%

Taxable Equivalent Market Yield(3)

 

8.05

 

 

Index Performance(4)

 

 

 

 

 

 

 

Lehman Brothers Municipal Bond Index - Average Annual Total Returns

 

 

 

One Year

 

4.45

%

Life of Fund (11/30/02)

 

5.00

 

 

Lipper Averages(5)

 

 

 

 

 

 

 

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

 

 

 

One Year

 

4.88

%

Life of Fund (11/30/02)

 

6.65

 

 

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

 

Portfolio Manager: Craig R. Brandon, CFA

 

Rating Distribution*(6),(7)

 

By total investments

 

GRAPHIC

 

*The rating distribution presented above includes the ratings of securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1B to the Fund’s financial statements. Absent such securities, the Fund’s rating distribution at September 30, 2006 is as follows:

 

AAA

 

83.5

%

BBB

 

4.9

%

AA

 

7.1

%

Not Rated

 

1.7

%

A

 

2.8

%

 

 

 

 

 

Leverage: 35.8%

 

The leverage amount is Auction Preferred Shares at liquidation value as a percentage of the Fund’s total assets excluding assets and floating rate notes payable deemed held pursuant to FAS Statement 140. The Fund uses leverage through the issuance of preferred shares. Use of financial leverage creates an opportunity for increased income but, at the same time, creates special risks (including the likelihood of greater volatility of net asset value and market price of common shares).

 


(1) Returns are historical and are calculated by determining the percentage change in share price or net asset value with all distributions reinvested. The Fund’s performance at market share price will differ from its results at NAV. Although share price performance generally reflects investment results over time, during shorter periods, returns at share price can also be affected by factors such as changing perceptions about the Fund, market conditions, fluctuations in supply and demand for the Fund’s shares, or changes in Fund distributions. Performance results reflect the effect of leverage resulting from the Fund’s issuance of Auction Preferred Shares. (2) The Fund’s market yield is calculated by dividing the last dividend per share of the fiscal year by the share price at the end of the fiscal year and annualizing the result. (3) Taxable-equivalent figure assumes a maximum 40.01% combined federal and state income tax rate. A lower tax rate would result in a lower tax-equivalent figure. (4) It is not possible to invest directly in an Index. The Index’s total return does not reflect the expenses that would have been incurred if an investor individually purchased or sold the securities represented in the Index. Index performance is available as of month end only. (5) The Lipper Averages are the average total returns at net asset value of the funds that are in the same Lipper Classification as the Fund. It is not possible to invest in a Lipper Classification. Lipper Classifications may include insured and uninsured funds, as well as leveraged and unleveraged funds. The Lipper New York Insured Municipal Debt Funds Classification (closed end) contained 12 funds for the 1-year and Life-of-Fund time periods. Lipper Averages are available as of month end only. (6) As of 9/30/06. Rating Distribution is determined by dividing the total market value of the issues by the total investments of the Fund. (7) As of 9/30/06. Portfolio holdings information includes securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1B to the Fund’s financial statements. Portfolio information may not be representative of the Fund’s current or future investments and may change due to active management.

 

9



 

Eaton Vance Insured Ohio Municipal Bond Fund as of September 30, 2006

 

PERFORMANCE INFORMATION AND PORTFOLIO COMPOSITION

 

Fund Performance as of 9/30/06(1)

 

Average Annual Total Return (by share price, American Stock Exchange)

 

 

 

One

 

5.69

%

Life of Fund (11/29/02)

 

6.37

 

 

Average Annual Total Return (by net asset value)

 

 

 

One Year

 

8.58

%

Life of Fund (11/29/02)

 

7.73

 

 

Market Yields

 

 

 

 

 

 

 

Market Yield(2)

 

4.60

%

Taxable Equivalent Market Yield(3)

 

7.65

 

 

Index Performance(4)

 

 

 

 

 

 

 

Lehman Brothers Municipal Bond Index - Average Annual Total Returns

 

 

 

One Year

 

4.45

%

Life of Fund (11/30/02)

 

5.00

 

 

Lipper Averages(5)

 

 

 

 

 

 

 

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

 

 

 

One Year

 

5.34

%

Life of Fund (11/30/02)

 

7.12

 

 

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

 

Portfolio Manager: William H. Ahern, CFA

 

Rating Distribution*(6),(7)

 

By total investments

 

GRAPHIC

 

*The rating distribution presented above includes the ratings of securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1B to the Fund’s financial statements. Absent such securities, the Fund’s rating distribution at September 30, 2006 is as follows:

 

AAA

 

83.2

%

BBB

 

2.6

%

AA

 

5.2

%

Not Rated

 

2.7

%

A

 

6.3

%

 

 

 

 

 

Leverage: 36.2%

 

The leverage amount is Auction Preferred Shares at liquidation value as a percentage of the Fund’s total assets excluding assets and floating rate notes payable deemed held pursuant to FAS Statement 140. The Fund uses leverage through the issuance of preferred shares. Use of financial leverage creates an opportunity for increased income but, at the same time, creates special risks (including the likelihood of greater volatility of net asset value and market price of common shares).

 


(1) Returns are historical and are calculated by determining the percentage change in share price or net asset value with all distributions reinvested. The Fund’s performance at market share price will differ from its results at NAV. Although share price performance generally reflects investment results over time, during shorter periods, returns at share price can also be affected by factors such as changing perceptions about the Fund, market conditions, fluctuations in supply and demand for the Fund’s shares, or changes in Fund distributions. Performance results reflect the effect of leverage resulting from the Fund’s issuance of Auction Preferred Shares. (2) The Fund’s market yield is calculated by dividing the last dividend per share of the fiscal year by the share price at the end of the fiscal year and annualizing the result. (3) Taxable-equivalent figure assumes a maximum 39.88% combined federal and state income tax rate. A lower tax rate would result in a lower tax-equivalent figure. (4) It is not possible to invest directly in an Index. The Index’s total return does not reflect the expenses that would have been incurred if an investor individually purchased or sold the securities represented in the Index. Index performance is available as of month end only. (5) The Lipper Averages are the average total returns at net asset value of the funds that are in the same Lipper Classification as the Fund. It is not possible to invest in a Lipper Classification. Lipper Classifications may include insured and uninsured funds, as well as leveraged and unleveraged funds. The Lipper Other States Municipal Debt Funds Classification (closed end) contained 46 funds for the 1-year and Life-of-Fund time periods. Lipper Averages are available as of month end only. (6) As of 9/30/06. Rating Distribution is determined by dividing the total market value of the issues by the total investments of the Fund. (7) As of 9/30/06. Portfolio holdings information includes securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1B to the Fund’s financial statements. Portfolio information may not be representative of the Fund’s current or future investments and may change due to active management.

 

10



 

Eaton Vance Insured Pennsylvania Municipal Bond Fund as of September 30, 2006

 

PERFORMANCE INFORMATION AND PORTFOLIO COMPOSITION

 

Fund Performance as of 9/30/06(1)

 

 

 

 

 

 

 

Average Annual Total Return (by share price, American Stock Exchange)

 

 

 

One Year

 

1.68

%

Life of Fund (11/29/02)

 

7.53

 

 

Average Annual Total Return (by net asset value)

 

 

 

One Year

 

9.00

%

Life of Fund (11/29/02)

 

8.36

 

 

Market Yields

 

 

 

 

 

 

 

Market Yield(2)

 

4.66

%

Taxable Equivalent Market Yield(3)

 

7.40

 

 

Index Performance(4)

 

 

 

 

 

 

 

Lehman Brothers Municipal Bond Index - Average Annual Total Returns

 

 

 

One Year

 

4.45

%

Life of Fund (11/30/02)

 

5.00

 

 

Lipper Averages(5)

 

 

 

 

 

 

 

Lipper Pennsylvania Municipal Debt Funds Classification - Average Annual Total Returns

 

 

 

One Year

 

5.48

%

Life of Fund (11/30/02)

 

7.17

 

 

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

 

Portfolio Manager: Thomas M. Metzold, CFA

 

Rating Distribution*(6),(7)

 

By total investments

 

GRAPHIC

 

*The rating distribution presented above includes the ratings of securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1B to the Fund’s financial statements. Absent such securities, the Fund’s rating distribution at September 30, 2006 is as follows:

 

AAA

 

85.8

%

BBB

 

1.3

%

AA

 

5.5

%

Not Rated

 

1.5

%

A

 

5.9

%

 

 

 

 

 

Leverage: 36.3%

 

The leverage amount is Auction Preferred Shares at liquidation value as a percentage of the Fund’s total assets excluding assets and floating rate notes payable deemed held pursuant to FAS Statement 140. The Fund uses leverage through the issuance of preferred shares. Use of financial leverage creates an opportunity for increased income but, at the same time, creates special risks (including the likelihood of greater volatility of net asset value and market price of common shares).

 


(1) Returns are historical and are calculated by determining the percentage change in share price or net asset value with all distributions reinvested. The Fund’s performance at market share price will differ from its results at NAV. Although share price performance generally reflects investment results over time, during shorter periods, returns at share price can also be affected by factors such as changing perceptions about the Fund, market conditions, fluctuations in supply and demand for the Fund’s shares, or changes in Fund distributions. Performance results reflect the effect of leverage resulting from the Fund’s issuance of Auction Preferred Shares. (2) The Fund’s market yield is calculated by dividing the last dividend per share of the fiscal year by the share price at the end of the fiscal year and annualizing the result. (3) Taxable-equivalent figure assumes a maximum 37.00% combined federal and state income tax rate. A lower tax rate would result in a lower tax-equivalent figure. (4) It is not possible to invest directly in an Index. The Index’s total return does not reflect the expenses that would have been incurred if an investor individually purchased or sold the securities represented in the Index. Index performance is available as of month end only. (5) The Lipper Averages are the average total returns at net asset value of the funds that are in the same Lipper Classification as the Fund. It is not possible to invest in a Lipper Classification. Lipper Classifications may include insured and uninsured funds, as well as leveraged and unleveraged funds. The Lipper Pennsylvania Municipal Debt Funds Classification (closed end) contained 9 funds for the 1-year and Life-of-Fund time periods. Lipper Averages are available as of month end only. (6) As of 9/30/06. Rating Distribution is determined by dividing the total market value of the issues by the total investments of the Fund. (7) As of 9/30/06. Portfolio holdings information includes securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1B to the Fund’s financial statements. Portfolio information may not be representative of the Fund’s current or future investments and may change due to active management.

 

11



Eaton Vance Insured Municipal Bond Fund II as of September 30, 2006

PORTFOLIO OF INVESTMENTS (As Restated — See Note 11)


Tax-Exempt Investments — 180.8%
     
Principal Amount
(000's omitted)
  Security   Value  
Electric Utilities — 1.1%      
$ 1,600     Sabine River Authority, TX, (TXU Energy Co. LLC),
5.20%, 5/1/28
  $ 1,657,952    
            $ 1,657,952    
Escrowed / Prerefunded — 1.2%      
$ 1,250     Capital Trust Agency, FL, (Seminole Tribe Convention),
Prerefunded to 10/1/12, 8.95%, 10/1/33(1)
  $ 1,544,012    
  390     New York City, NY, Prerefunded to 1/15/13,
5.25%, 1/15/33
    427,381    
            $ 1,971,393    
General Obligations — 7.0%      
$ 4,500     California, 5.25%, 4/1/30   $ 4,733,505    
  2,215     California, 5.50%, 11/1/33     2,435,459    
  3,610     New York City, NY, 5.25%, 1/15/33     3,818,550    
            $ 10,987,514    
Hospital — 9.6%      
$ 1,275     Brevard County, FL, Health Facilities Authority,
(Health First, Inc.), 5.00%, 4/1/36
  $ 1,314,895    
  3,335     California Health Facilities Financing Authority,
(Cedars-Sinai Medical Center), 5.00%, 11/15/34
    3,436,117    
  400     Camden County, NJ, Improvement Authority,
(Cooper Health System), 5.00%, 2/15/25
    411,700    
  900     Camden County, NJ, Improvement Authority,
(Cooper Health System), 5.00%, 2/15/35
    918,099    
  750     Camden County, NJ, Improvement Authority,
(Cooper Health System), 5.25%, 2/15/27
    786,990    
  380     Cuyahoga County, OH, (Cleveland Clinic Health System),
5.50%, 1/1/29
    406,577    
  500     Hawaii Department of Budget and Finance,
(Hawaii Pacific Health), 5.60%, 7/1/33
    525,780    
  1,000     Highlands County, FL, Health Facilities Authority,
(Adventist Health System), 5.375%, 11/15/35
    1,053,480    
  1,000     Lehigh County, PA, General Purpose Authority,
(Lehigh Valley Health Network), 5.25%, 7/1/32
    1,053,590    
  5,000     South Miami, FL, Health Facility Authority,
(Baptist Health), 5.25%, 11/15/33
    5,217,100    
            $ 15,124,328    
Insured-Electric Utilities — 18.9%      
$ 1,000     Burlington, KS, PCR, (Kansas Gas & Electric Co.),
(MBIA), 5.30%, 6/1/31
  $ 1,071,520    

 

Principal Amount
(000's omitted)
 
Security
 
Value
 
Insured-Electric Utilities (continued)      
$ 22,685     Chelan County, WA, Public Utility District No. 1,
(Columbia River), (MBIA), 0.00%, 6/1/23
  $ 10,820,064    
  3,900     JEA, FL, Electric System Revenue, (FSA),
5.00%, 10/1/34
    4,013,880    
  11,505     Long Island Power Authority, NY, Electric
Systems Revenue, (FGIC), 5.00%, 12/1/23(2)(6)
    12,348,086    
  1,500     Municipal Energy Agency, NE, (Power Supply System),
(FSA), 5.00%, 4/1/36
    1,562,925    
            $ 29,816,475    
Insured-General Obligations — 28.0%      
$ 1,600     Alvin, TX, Independent School District, (MBIA),
3.25%, 2/15/27
  $ 1,335,920    
  2,550     Butler County, KS, Unified School
District No. 394, (FSA), 3.50%, 9/1/24
    2,286,483    
  4,915     California, (XLCA), 5.00%, 10/1/28(2)(6)     5,128,626    
  1,515     Chicago, IL, (MBIA), 5.00%, 1/1/42     1,564,556    
  10,000     Chicago, IL, Board of Education, (FGIC),
0.00%, 12/1/23
    4,696,400    
  17,000     Coast Community College District, CA,
(Election of 2002), (FSA), 0.00%, 8/1/33
    4,226,710    
  4,830     King County, WA, (MBIA), 5.25%, 1/1/34     4,956,642    
  1,100     Louisiana, (FSA), 4.25%, 5/1/25     1,070,300    
  1,325     North Las Vegas, NV, Wastewater Reclamation System,
(MBIA), 4.25%, 10/1/33)(3)
    1,272,517    
  6,250     Philadelphia, PA, (FSA), 5.00%, 9/15/31(2)(6)     6,442,109    
  770     Phoenix, AZ, (AMBAC), 3.00%, 7/1/28     619,550    
  5,490     Port Orange, FL, Capital Improvements, (FGIC),
5.00%, 10/1/35
    5,750,445    
  10,000     Washington, (Motor Vehicle Fuel), (MBIA),
0.00%, 12/1/23
    4,712,200    
            $ 44,062,458    
Insured-Hospital — 7.2%      
$ 9,000     Maryland Health and Higher Educational Facilities
Authority, (Medlantic/Helix Issue), (FSA),
5.25%, 8/15/38(2)(6)
  $ 10,519,260    
  815     Washington Health Facilities Authority,
(Providence Health Care), (FGIC),
4.50%, 10/1/35
    806,524    
            $ 11,325,784    
Insured-Industrial Development Revenue — 1.7%      
$ 2,590     Monroe County, GA, Development Authority, Pollution
Control, (Georgia Power Co.), (AMBAC), 4.90%, 7/1/36
  $ 2,639,832    
            $ 2,639,832    

 

See notes to financial statements
12



Eaton Vance Insured Municipal Bond Fund II as of September 30, 2006

PORTFOLIO OF INVESTMENTS CONT'D (As Restated — See Note 11)

Principal Amount
(000's omitted)
 
Security
 
Value
 
Insured-Lease Revenue / Certificates of
Participation — 2.8%
     
$ 4,250     Massachusetts Development Finance Agency, (MBIA),
5.125%, 2/1/34
  $ 4,465,050    
            $ 4,465,050    
Insured-Other Revenue — 1.0%      
$ 1,500     Golden State Tobacco Securitization Corp., CA, (AGC),
5.00%, 6/1/45
  $ 1,556,550    
            $ 1,556,550    
Insured-Private Education — 3.7%      
$ 2,500     Massachusetts Development Finance Agency,
(Boston University), (XLCA), 6.00%, 5/15/59
  $ 3,142,725    
  2,500     Massachusetts Development Finance Agency,
(Franklin W. Olin College), (XLCA), 5.25%, 7/1/33
    2,647,575    
            $ 5,790,300    
Insured-Public Education — 5.9%      
$ 3,500     College of Charleston, SC, Academic and Administrative
Facilities, (XLCA), 5.125%, 4/1/30
  $ 3,689,980    
  5,335     University of California, (AMBAC), 5.00%, 9/1/27     5,543,118    
            $ 9,233,098    
Insured-Sewer Revenue — 2.4%      
$ 1,100     Marysville, OH, Wastewater Treatment System, (XLCA),
4.75%, 12/1/46
  $ 1,105,489    
  2,575     Tacoma, WA, Sewer Revenue, (FGIC),
5.00%, 12/1/31
    2,659,460    
            $ 3,764,949    
Insured-Special Assessment Revenue — 4.2%      
$ 6,500     San Jose, CA, Redevelopment Agency Tax, (MBIA),
5.00%, 8/1/32(2)(6)
  $ 6,691,213    
            $ 6,691,213    
Insured-Special Tax Revenue — 7.0%      
$ 4,000     Metropolitan Pier and Exposition Authority, IL,
(McCormick Place Expansion), (MBIA),
5.25%, 6/15/42
  $ 4,281,080    
  2,500     New York Convention Center Development Corp.,
Hotel Occupancy Tax, (AMBAC), 4.75%, 11/15/45
    2,542,675    
  4,000     New York Convention Center Development Corp.,
Hotel Occupancy Tax, (AMBAC), 5.00%, 11/15/44
    4,182,280    
            $ 11,006,035    

 

Principal Amount
(000's omitted)
 
Security
 
Value
 
Insured-Transportation — 30.4%      
$ 1,000     Central, TX, Regional Mobility Authority, (FGIC),
5.00%, 1/1/45
  $ 1,034,440    
  11,900     E-470 Public Highway Authority, CO, (MBIA),
0.00%, 9/1/22
    5,941,670    
  12,390     E-470 Public Highway Authority, CO, (MBIA),
0.00%, 9/1/24
    5,610,192    
  1,600     Harris County, TX, (MBIA), 4.50%, 8/15/36(3)     1,577,920    
  13,885     Nevada Department of Business and Industry,
(Las Vegas Monorail -1st Tier), (AMBAC),
0.00%, 1/1/20
    7,788,096    
  5,000     South Carolina Transportation Infrastructure, (AMBAC),
5.25%, 10/1/31
    5,285,600    
  10,000     Texas Turnpike Authority, (AMBAC), 5.00%, 8/15/42(4)     10,299,500    
  10,000     Triborough Bridge and Tunnel Authority, NY, (MBIA),
5.00%, 11/15/32
    10,408,600    
            $ 47,946,018    
Insured-Utilities — 4.0%      
$ 6,000     Philadelphia, PA, Gas Works Revenue, (FSA),
5.00%, 8/1/32
  $ 6,258,900    
            $ 6,258,900    
Insured-Water and Sewer — 11.1%      
$ 2,240     Atlanta, GA, Water and Sewer, (FGIC),
5.00%, 11/1/38(5)
  $ 2,288,205    
  8,155     Birmingham, AL, Waterworks and Sewer Board, (MBIA),
5.00%, 1/1/37
    8,480,548    
  600     Fort Lauderdale, FL, Water and Sewer, (MBIA),
4.25%, 9/1/33(3)
    579,888    
  1,950     New York City, NY, Municipal Water Finance Authority,
(Water and Sewer System), (AMBAC), 5.00%, 6/15/38
    2,029,287    
  3,825     Pittsburgh, PA, Water and Sewer Authority, (AMBAC),
5.125%, 12/1/27(2)(6)
    4,033,297    
            $ 17,411,225    
Insured-Water Revenue — 32.1%      
$ 4,895     Atlanta, GA, Water and Wastewater, (MBIA),
5.00%, 11/1/39
  $ 5,054,871    
  7,000     Contra Costa, CA, Water District, (FSA),
5.00%, 10/1/32(2)(6)
    7,284,703    
  10,350     Detroit, MI, Water Supply System, (MBIA),
5.00%, 7/1/34(2)(6)
    10,767,105    
  6,500     Los Angeles, CA, Department of Water and Power,
Water Revenue, (FGIC), 5.00%, 7/1/43
    6,723,340    
  6,260     Massachusetts Water Resources Authority, (AMBAC),
4.00%, 8/1/40
    5,683,141    

 

See notes to financial statements
13



Eaton Vance Insured Municipal Bond Fund II as of September 30, 2006

PORTFOLIO OF INVESTMENTS CONT'D (As Restated — See Note 11)

Principal Amount
(000's omitted)
 
Security
 
Value
 
Insured-Water Revenue (continued)      
$ 7,000     Metropolitan Water District, CA, (FGIC),
5.00%, 10/1/36
  $ 7,313,040    
  2,870     San Antonio, TX, Water Revenue, (FGIC),
5.00%, 5/15/23
    3,028,941    
  4,610     Texas Southmost Regional Water Authority, (MBIA),
5.00%, 9/1/32
    4,775,776    
            $ 50,630,917    
Special Tax Revenue — 1.5%      
$ 750     New Jersey Economic Development Authority,
(Cigarette Tax), 5.50%, 6/15/24
  $ 788,347    
  1,480     New Jersey Economic Development Authority,
(Cigarette Tax), 5.75%, 6/15/29
    1,591,918    
            $ 2,380,265    
  Total Tax-Exempt Investments — 180.8%
(identified cost $267,529,131)
        $ 284,720,256    
Other Assets, Less Liabilities — (25.2)%   $ (39,748,802 )  
  Auction Preferred Shares Plus Cumulative
Unpaid Dividends — (55.6)%
        $ (87,508,569 )  
Net Assets Applicable to
Common Shares — 100.0%
  $ 157,462,885    

 

AGC - Assured Guaranty Corp.

AMBAC - AMBAC Financial Group, Inc.

FGIC - Financial Guaranty Insurance Company

FSA - Financial Security Assurance, Inc.

MBIA - Municipal Bond Insurance Association

XLCA - XL Capital Assurance, Inc.

The Fund invests primarily in debt securities issued by municipalities. The ability of the issuers of the debt securities to meet their obligations may be affected by economic developments in a specific industry or municipality. In order to reduce the risk associated with such economic developments, at September 30, 2006, 88.7% of total investments are backed by bond insurance of various financial institutions and financial guaranty assurance agencies. The aggregate percentage insured by an individual financial institution ranged from 0.5% to 33.1% of total investments.

(1)  Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be sold in transactions exempt from registration, normally to qualified institutional buyers. At September 30, 2006, the aggregate value of the securities is $1,544,012 or 1.0% of the Fund's net assets applicable to common shares.

(2)  Security valued at fair value using methods determined in good faith by or at the direction of the Trustees.

(3)  When-issued security.

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

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

(6)  As restated — See Note 11.

See notes to financial statements
14



Eaton Vance Insured California Municipal Bond Fund II as of September 30, 2006

PORTFOLIO OF INVESTMENTS (As Restated — See Note 11)

Tax-Exempt Investments — 169.0%      
Principal Amount
(000's omitted)
  Security   Value  
General Obligations — 4.3%      
$ 900     California, 5.25%, 4/1/30   $ 946,701    
  1,465     California, 5.50%, 11/1/33     1,610,811    
            $ 2,557,512    
Hospital — 15.9%      
$ 1,850     California Health Facilities Financing Authority,
(Cedars-Sinai Medical Center), 5.00%, 11/15/34
  $ 1,906,092    
  2,940     California Statewide Communities Development Authority,
(Huntington Memorial Hospital), 5.00%, 7/1/35
    3,033,404    
  1,000     California Statewide Communities Development Authority,
(John Muir Health), 5.00%, 8/15/36
    1,034,230    
  1,400     California Statewide Communities Development Authority,
(Kaiser Permanente), 5.00%, 3/1/41
    1,441,510    
  1,900     California Statewide Communities Development Authority,
(Kaiser Permanente), 5.25%, 3/1/45
    2,003,151    
            $ 9,418,387    
Insured-Electric Utilities — 8.1%      
$ 1,475     Glendale Electric, (MBIA), 5.00%, 2/1/32   $ 1,536,817    
  1,650     Puerto Rico Electric Power Authority, (FSA),
Variable Rate, 6.53%, 7/1/29(1)(2)
    1,842,060    
  1,370     Sacramento Municipal Electric Utility District, (FSA),
5.00%, 8/15/28(3)(4)
    1,426,657    
            $ 4,805,534    
Insured-Escrowed/Prerefunded — 7.6%      
$ 4,000     California Infrastructure and Economic Development,
(Bay Area Toll Bridges), (AMBAC), Prerefunded to
1/1/28, 5.00%, 7/1/36
  $ 4,498,080    
            $ 4,498,080    
Insured-General Obligations — 43.2%      
$ 1,250     California, (AMBAC), 5.00%, 4/1/27   $ 1,309,962    
  1,250     California, (XLCA), 5.00%, 10/1/28(3)(4)     1,304,058    
  5,000     Clovis Unified School District, (FGIC), 0.00%, 8/1/20     2,775,050    
  6,675     Coast Community College District, (FSA), 0.00%, 8/1/35     1,482,851    
  2,000     Laguna Salada Union School District, (FGIC),
0.00%, 8/1/22
    1,006,920    
  2,350     Long Beach Unified School District, (Election of 1999),
(FSA), 5.00%, 8/1/31
    2,431,944    
  1,945     Los Osos Community Services, Wastewater Assessment District,
(MBIA), 5.00%, 9/2/33
    2,023,422    

 

Principal Amount
(000's omitted)
  Security   Value  
Insured-General Obligations (continued)      
$ 1,000     Mount Diablo Unified School District, (FSA),
5.00%, 8/1/25
  $ 1,058,320    
  2,205     San Diego Unified School District, (MBIA),
5.50%, 7/1/24(3)(4)
    2,586,921    
  4,300     San Mateo County Community College District,
(Election of 2001), (FGIC), 0.00%, 9/1/21
    2,262,488    
  1,750     Santa Ana Unified School District, (MBIA),
5.00%, 8/1/32
    1,820,070    
  1,620     Santa Clara Unified School District, (Election of 2004),
(FSA), 4.375%, 7/1/30
    1,619,903    
  1,000     Simi Valley Unified School District, (MBIA),
5.00%, 8/1/28
    1,055,990    
  3,200     Union Elementary School District, (FGIC),
0.00%, 9/1/22
    1,605,248    
  2,600     Union Elementary School District, (FGIC),
0.00%, 9/1/23
    1,240,720    
            $ 25,583,867    
Insured-Lease Revenue / Certificates of
Participation — 20.2%
     
$ 4,000     Anaheim Public Financing Authority Lease Revenue,
(FSA), 5.00%, 3/1/37
  $ 4,063,360    
  4,250     California Public Works Board Lease Revenue,
(Department of General Services), (AMBAC),
5.00%, 12/1/27(5)
    4,436,447    
  2,250     Orange County Water District, Certificates of Participation,
(MBIA), 5.00%, 8/15/34
    2,344,568    
  1,075     San Jose Financing Authority, (Civic Center), (AMBAC),
5.00%, 6/1/32
    1,115,087    
            $ 11,959,462    
Insured-Public Education — 13.8%      
$ 4,000     California State University, (AMBAC), 5.00%, 11/1/33   $ 4,156,040    
  3,790     University of California, (FGIC), 5.125%, 9/1/31     3,991,211    
            $ 8,147,251    
Insured-Special Assessment Revenue — 22.4%      
$ 2,500     Cathedral City Public Financing Authority,
(Housing Redevelopment), (MBIA), 5.00%, 8/1/33
  $ 2,609,350    
  2,500     Cathedral City Public Financing Authority,
(Tax Allocation Redevelopment), (MBIA),
5.00%, 8/1/33
    2,609,350    
  1,750     Irvine Public Facility and Infrastructure Authority
Assessment, (AMBAC), 5.00%, 9/2/26
    1,807,505    
  2,000     Murrieta Redevelopment Agency Tax, (MBIA),
5.00%, 8/1/32
    2,089,780    

 

See notes to financial statements
15



Eaton Vance Insured California Municipal Bond Fund II as of September 30, 2006

PORTFOLIO OF INVESTMENTS CONT'D (As Restated — See Note 11)

Principal Amount
(000's omitted)
  Security   Value  
Insured-Special Assessment Revenue (continued)      
$ 4,000     San Jose Redevelopment Agency Tax, (MBIA),
5.00%, 8/1/32(3)(4)
  $ 4,117,907    
            $ 13,233,892    
Insured-Special Tax Revenue — 12.6%      
$ 2,000     Puerto Rico Infrastructure Financing Authority,
(AMBAC), 0.00%, 7/1/28
  $ 773,760    
  1,060     Puerto Rico Infrastructure Financing Authority,
(AMBAC), 0.00%, 7/1/37
    262,668    
  8,000     Puerto Rico Infrastructure Financing Authority,
(AMBAC), 0.00%, 7/1/44
    1,434,560    
  1,000     San Francisco Bay Area Rapid Transportation District,
Sales Tax Revenue, (AMBAC), 5.00%, 7/1/31
    1,035,190    
  3,750     San Francisco Bay Area Rapid Transportation District,
Sales Tax Revenue, (AMBAC), 5.125%, 7/1/36
    3,937,463    
            $ 7,443,641    
Insured-Transportation — 4.6%      
$ 6,670     San Joaquin Hills Transportation Corridor Agency, (MBIA),
0.00%, 1/15/27
  $ 2,703,351    
            $ 2,703,351    
Insured-Utilities — 3.1%      
$ 1,750     Los Angeles Department of Water and Power, (FGIC),
5.125%, 7/1/41
  $ 1,813,210    
            $ 1,813,210    
Insured-Water Revenue — 8.9%      
$ 2,500     Contra Costa Water District, (FSA),
5.0%, 10/1/32(3)(4)
  $ 2,602,029    
  1,500     Los Angeles, Department of Water and Power,
Water Revenue, (MBIA), 3.00%, 7/1/30
    1,178,310    
  1,560     San Francisco City and County Public Utilities Commission,
(FSA), 4.25%, 11/1/33
    1,517,100    
            $ 5,297,439    
Water Revenue — 4.3%      
$ 2,500     California Water Resource, (Central Valley),
5.00%, 12/1/29
  $ 2,557,550    
            $ 2,557,550    
  Total Tax-Exempt Investments — 169.0%
(identified cost $94,601,836)
        $ 100,019,176    

 

Principal Amount
(000's omitted)
  Security   Value  
Other Assets, Less Liabilities — (12.0)%       $ (7,060,278 )  
Auction Preferred Shares Plus Cumulative
Unpaid Dividends — (57.0)%
      $ (33,759,430 )  
Net Assets Applicable to
Common Shares — 100.0%
      $ 59,199,468    

 

AMBAC - AMBAC Financial Group, Inc.

FGIC - Financial Guaranty Insurance Company

FSA - Financial Security Assurance, Inc.

MBIA - Municipal Bond Insurance Association

XLCA - XL Capital Assurance, Inc.

The Fund invests primarily in debt securities issued by California municipalities. The ability of the issuers of the debt securities to meet their obligations may be affected by economic developments in a specific industry or municipality. In order to reduce the risk associated with such economic developments, at September 30, 2006, 85.5% of total investments are backed by bond insurance of various financial institutions and financial guaranty assurance agencies. The aggregate percentage insured by an individual financial institution ranged from 1.3% to 26.7% of total investments.

(1)  Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be sold in transactions exempt from registration, normally to qualified institutional buyers. At September 30, 2006, the aggregate value of the securities is $1,842,060 or 3.1% of the Fund's net assets applicable to common shares.

(2)  Security has been issued as an inverse floater bond. The stated interest rate represents the rate in effect at September 30, 2006.

(3)  Security valued at fair value using methods determined in good faith by or at the direction of the Trustees.

(4)  As restated, See Note 11.

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

See notes to financial statements
16



Eaton Vance Insured Florida Municipal Bond Fund as of September 30, 2006

PORTFOLIO OF INVESTMENTS (As Restated — See Note 11)

Tax-Exempt Investments — 166.0%      
Principal Amount
(000's omitted)
  Security   Value  
Hospital — 13.7%      
$ 1,150     Brevard County Health Facilities Authority,
(Health First, Inc.), 5.00%, 4/1/36
  $ 1,185,983    
  500     Highlands County Health Facilities Authority,
(Adventist Glenoaks Hospital/Adventist Healthcare),
5.00%, 11/15/31
    517,385    
  1,050     Highlands County, Health Facilities Authority,
(Adventist Health), 5.25%, 11/15/23
    1,100,295    
  500     Orange County Health Facilities Authority,
(Orlando Regional Healthcare), 5.125%, 11/15/39
    523,415    
  1,000     Orange County, Health Facilities Authority,
(Orlando Regional Healthcare), 4.75%, 11/15/36
    1,005,320    
  1,000     South Miami, Health Facility Authority Hospital Revenue,
(Baptist Health), 5.25%, 11/15/33
    1,043,420    
            $ 5,375,818    
Insured-Electric Utilities — 12.2%      
$ 1,500     Deltona, Utility System Revenue, (MBIA),
5.00%, 10/1/33
  $ 1,568,010    
  1,600     Jacksonville Electric Authority, Electric System Revenue,
(FSA), 4.75%, 10/1/34
    1,612,672    
  1,000     Lakeland Energy System, (XLCA), 4.75%, 10/1/36     1,020,360    
  500     Puerto Rico Electric Power Authority, (FSA),
Variable Rate, 6.53%, 7/1/29(1)(2)
    558,200    
            $ 4,759,242    
Insured-Escrowed / Prerefunded — 3.1%      
$ 1,025     Dade County, Professional Sports Franchise Facility,
(MBIA), Escrowed to Maturity, 5.25%, 10/1/30
  $ 1,192,751    
            $ 1,192,751    
Insured-General Obligations — 8.9%      
$ 1,345     Florida Board of Education Capital Outlay,
(Public Education), (MBIA), 5.00%, 6/1/32
  $ 1,405,216    
  2,000     Florida Board of Education Capital Outlay,
(Public Education), (MBIA), 5.00%, 6/1/32
    2,089,540    
            $ 3,494,756    
Insured-Hospital — 11.1%      
$ 1,000     Coral Gables, Health Facilities Authority, (Baptist Health
System of South Florida), (FSA), 5.00%, 8/15/29
  $ 1,050,060    

 

Principal Amount
(000's omitted)
  Security   Value  
Insured-Hospital (continued)      
$ 1,500     Miami-Dade County, Health Facilities Authority, (Miami
Children's Hospital), (AMBAC), 5.125%, 8/15/26
  $ 1,571,130    
  1,510     Sarasota County, Public Hospital Board, (Sarasota
Memorial Hospital), (MBIA), 5.25%, 7/1/24(4)
    1,703,884    
            $ 4,325,074    
Insured-Other Revenue — 9.2%      
$ 1,500     Miami-Dade County, (Professional Sports Franchise),
(MBIA), 4.75%, 10/1/30
  $ 1,517,715    
  2,000     Village Center Community Development District, (MBIA),
5.00%, 11/1/32
    2,095,000    
            $ 3,612,715    
Insured-Pooled Loans — 3.7%      
$ 1,520     Florida Municipal Loan Council Revenue, (MBIA),
0.00%, 4/1/23
  $ 741,076    
  1,520     Florida Municipal Loan Council Revenue, (MBIA),
0.00%, 4/1/24
    707,089    
            $ 1,448,165    
Insured-Private Education — 4.4%      
$ 700     Broward County Educational Facilities Authority, (Nova
Southeastern University), (AGC), 4.50%, 4/1/36
  $ 692,664    
  1,000     Broward County Educational Facilities Authority, (Nova
Southeastern University), (AGC), 5.00%, 4/1/36
    1,049,770    
            $ 1,742,434    
Insured-Sewer Revenue — 2.7%      
$ 1,000     Pinellas County, Sewer, (FSA), 5.00%, 10/1/32   $ 1,045,950    
            $ 1,045,950    
Insured-Special Assessment Revenue — 7.4%      
$ 2,780     Julington Creek, Plantation Community Development District,
(MBIA), 5.00%, 5/1/29
  $ 2,902,681    
            $ 2,902,681    
Insured-Special Tax Revenue — 43.7%      
$ 1,000     Bay County, Sales Tax, (AMBAC), 5.125%, 9/1/27   $ 1,056,610    
  1,250     Bay County, Sales Tax, (AMBAC), 5.125%, 9/1/32     1,320,762    
  500     Dade County, Residual Certificates, (AMBAC),
Variable Rate, 6.995%, 10/1/35(1)(3)
    522,705    
  1,500     Dade County, (AMBAC), 5.00%, 10/1/35(5)(6)     1,522,705    
  1,500     Jacksonville Capital Improvements, (AMBAC),
5.00%, 10/1/30
    1,560,285    
  3,750     Jacksonville Transportation Revenue, (MBIA),
5.00%, 10/1/31
    3,874,762    

 

See notes to financial statements
17



Eaton Vance Insured Florida Municipal Bond Fund as of September 30, 2006

PORTFOLIO OF INVESTMENTS CONT'D (As Restated — See Note 11)

Principal Amount
(000's omitted)
  Security   Value  
Insured-Special Tax Revenue (continued)      
$ 1,275     Jacksonville, Excise Tax, (FGIC), 5.125%, 10/1/27   $ 1,348,109    
  600     Miami-Dade County, Special Obligation, (MBIA),
0.00%, 10/1/35
    139,650    
  8,000     Miami-Dade County, Special Obligation, (MBIA),
0.00%, 10/1/39
    1,498,400    
  225     Miami-Dade County, Special Obligation, (MBIA),
5.00%, 10/1/37
    229,561    
  440     Puerto Rico Infrastructure Financing Authority, (AMBAC),
Prerefunded to 1/1/08, Variable Rate,
6.832%, 7/1/28(1)(3)
    475,394    
  2,250     Orange County Tourist Development, (AMBAC),
5.125%, 10/1/30(5)(6)
    2,369,430    
  445     Puerto Rico Infrastructure Financing Authority, (AMBAC),
0.00%, 7/1/28
    172,162    
  2,000     Puerto Rico Infrastructure Financing Authority, (FGIC),
0.00%, 7/1/42
    394,620    
  1,120     Sunrise Public Facilities, (MBIA), 0.00%, 10/1/20     618,912    
            $ 17,104,067    
Insured-Transportation — 20.0%      
$ 1,500     Florida Turnpike Authority, Water & Sewer Revenue,
(Department of Transportation), (FGIC), 4.50%, 7/1/27
  $ 1,503,960    
  1,605     Port Palm Beach District, (Improvements), (XLCA),
0.00%, 9/1/24
    733,148    
  1,950     Port Palm Beach District, (Improvements), (XLCA),
0.00%, 9/1/25
    849,479    
  1,700     Port Palm Beach District, (Improvements), (XLCA),
0.00%, 9/1/26
    705,993    
  1,000     Puerto Rico Highway and Transportation Authority, (FSA),
5.00%, 7/1/32(5)(6)
    1,041,857    
  2,825     Puerto Rico Highway and Transportation Authority, (MBIA),
5.00%, 7/1/36(5)(6)
    3,005,048    
            $ 7,839,485    
Insured-Utilities — 7.2%      
$ 1,550     Daytona Beach, Utility System Revenue, (AMBAC),
5.00%, 11/15/32
  $ 1,616,898    
  4,675     Port St. Lucie, Utility System Revenue, (MBIA),
0.00%, 9/1/32
    1,206,103    
            $ 2,823,001    
Insured-Water and Sewer — 18.7%      
$ 1,000     Emerald Coast, Utility Authority Revenue, (FGIC),
4.75%, 1/1/31
  $ 1,022,870    
  1,500     Jacksonville Electric Authority, Water and Sewer System,
(MBIA), 4.75%, 10/1/30
    1,527,495    
  2,000     Marco Island Utility System, (MBIA), 5.00%, 10/1/27     2,104,280    

 

Principal Amount
(000's omitted)
  Security   Value  
Insured-Water and Sewer (continued)      
$ 1,000     Marion County Utility System, (MBIA), 5.00%, 12/1/33   $ 1,046,210    
  1,000     Sunrise Utility System, (AMBAC), 5.00%, 10/1/28     1,078,260    
  500     Tampa Bay Water Utility System, (FGIC), Variable Rate,
5.44%, 10/1/27(1)(2)
    525,745    
            $ 7,304,860    
  Total Tax-Exempt Investments — 166.0%
(identified cost $61,688,482)
      $ 64,970,999    
  Other Assets, Less Liabilities — (8.5)%       $ (3,331,238 )  
  Auction Preferred Shares Plus Cumulative
Unpaid Dividends — (57.5)%
      $ (22,510,941 )  
  Net Assets Applicable to
Common Shares — 100.0%
      $ 39,128,820    

 

AGC - Assured Guaranty Corp.

AMBAC - AMBAC Financial Group, Inc.

FGIC - Financial Guaranty Insurance Company

FSA - Financial Security Assurance, Inc.

MBIA - Municipal Bond Insurance Association

XLCA - XL Capital Assurance, Inc.

The Fund invests primarily in debt securities issued by Florida municipalities. The ability of the issuers of the debt securities to meet their obligations may be affected by economic developments in a specific industry or municipality. In order to reduce the risk associated with such economic developments, at September 30, 2006, 91.7% of total investments are backed by bond insurance of various financial institutions and financial guaranty assurance agencies. The aggregate percentage insured by an individual financial institution ranged from 2.7% to 48.0% of total investments.

(1)  Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be sold in transactions exempt from registration, normally to qualified institutional buyers. At September 30, 2006, the aggregate value of the securities is $2,082,044 or 5.3% of the Fund's net assets applicable to common shares.

(2)  Security has been issued as an inverse floater bond. The stated interest rate represents the rate in effect at September 30, 2006.

(3)  Security has been issued as a leveraged inverse floater bond. The stated interest rate represents the rate in effect at September 30, 2006.

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

(5)  Security valued at fair value using methods determined in good faith by or at the direction of the Trustees.

(6)  As restated, See Note 11.

See notes to financial statements
18



Eaton Vance Insured Massachusetts Municipal Bond Fund as of September 30, 2006

PORTFOLIO OF INVESTMENTS (As Restated — See Note 11)

Tax-Exempt Investments — 192.7%      
Principal Amount
(000's omitted)
  Security   Value  
Escrowed / Prerefunded — 2.5%      
$ 600     Massachusetts Development Finance Agency,
(Western New England College), Prerefunded to
12/1/12, 6.125%, 12/1/32
  $ 685,272    
            $ 685,272    
Hospital — 9.8%      
$ 1,000     Massachusetts Health and Educational Facilities Authority,
(South Shore Hospital), 5.75%, 7/1/29
  $ 1,054,130    
  1,500     Massachusetts Health and Educational Facilities Authority,
(Partners Healthcare System), 5.75%, 7/1/32
    1,628,025    
            $ 2,682,155    
Insured-Electric Utilities — 2.9%      
$ 750     Puerto Rico Electric Power Authority, (FGIC),
5.00%, 7/1/35
  $ 793,815    
            $ 793,815    
Insured-Escrowed/Prerefunded — 37.6%      
$ 3,000     Massachusetts College Building Authority, (MBIA),
Escrowed to Maturity, 0.00%, 5/1/26
  $ 1,301,220    
  1,600     Massachusetts Development Finance Agency, (WGBH
Educational Foundation), (AMBAC), Prerefunded to
1/1/12, 5.375%, 1/1/42
    1,750,880    
  3,000     Puerto Rico, (FGIC), Prerefunded to 7/1/12,
5.00%, 7/1/32(1)(2)
    3,223,680    
  2,205     Puerto Rico Public Buildings Authority, (CIFG),
Prerefunded to 7/1/12, 5.25%, 7/1/36(1)(2)
    2,393,097    
  1,500     University of Massachusetts Building Authority, (AMBAC),
Prerefunded to 11/1/14, 5.125%, 11/1/34
    1,647,975    
            $ 10,316,852    
Insured-General Obligations — 21.8%      
$ 3,000     Massachusetts, (AMBAC), 5.50%, 8/1/30(1)(2)   $ 3,586,200    
  2,000     Massachusetts, (MBIA), 5.25%, 8/1/28     2,324,880    
  75     Sandwich, (MBIA), 4.50%, 7/15/29     76,378    
            $ 5,987,458    
Insured-Hospital — 4.7%      
$ 1,210     Massachusetts Health and Educational Facilities Authority,
(New England Medical Center), (FGIC), 5.00%, 5/15/25
  $ 1,272,254    
            $ 1,272,254    

 

Principal Amount
(000's omitted)
  Security   Value  
Insured-Lease Revenue / Certificates of
Participation — 13.7%
     
$ 1,750     Massachusetts Development Finance Agency, (MBIA),
5.125%, 2/1/34
  $ 1,838,550    
  1,000     Plymouth County Correctional Facility, (AMBAC),
5.00%, 4/1/22
    1,042,110    
  795     Puerto Rico Public Buildings Authority, (CIFG),
5.25%, 7/1/36(1)(2)
    848,113    
            $ 3,728,773    
Insured-Other — 4.6%      
$ 1,000     Massachusetts Development Finance Agency, (WGBH
Educational Foundation), (AMBAC), 5.75%, 1/1/42
  $ 1,254,370    
            $ 1,254,370    
Insured-Pooled Loans — 9.2%      
$ 2,400     Puerto Rico Municipal Finance Agency, (FSA),
5.00%, 8/1/27(1)(2)
  $ 2,514,840    
            $ 2,514,840    
Insured-Private Education — 26.0%      
$ 1,000     Massachusetts Development Finance Agency,
(Boston University), (XLCA), 5.375%, 5/15/39
  $ 1,159,370    
  1,000     Massachusetts Development Finance Agency,
(Boston University), (XLCA), 6.00%, 5/15/59
    1,257,090    
  585     Massachusetts Development Finance Agency,
(College of the Holy Cross), (AMBAC), 5.25%, 9/1/32
    687,088    
  750     Massachusetts Development Finance Agency,
(College of the Holy Cross), (AMBAC),
5.25%, 9/1/32(1)(2)
    880,890    
  1,500     Massachusetts Development Finance Agency,
(Franklin W. Olin College), (XLCA), 5.25%, 7/1/33
    1,588,545    
  750     Massachusetts Development Finance Agency,
(Massachusetts College of Pharmacy), (AGC),
5.00%, 7/1/35
    778,762    
  500     Massachusetts Development Finance Agency,
(Western New England College), (AGC), 5.00%, 9/1/33
    525,125    
  250     Massachusetts Industrial Finance Agency,
(Tufts University), (MBIA), 4.75%, 2/15/28
    252,307    
            $ 7,129,177    
Insured-Public Education — 11.3%      
$ 700     Massachusetts College Building Authority, (XLCA),
5.50%, 5/1/39
  $ 847,196    
  1,000     Massachusetts Health and Educational Facilities Authority,
(University of Massachusetts), (FGIC), 5.125%, 10/1/34
    1,057,340    

 

See notes to financial statements
19



Eaton Vance Insured Massachusetts Municipal Bond Fund as of September 30, 2006

PORTFOLIO OF INVESTMENTS CONT'D (As Restated — See Note 11)

Principal Amount
(000's omitted)
  Security   Value  
Insured-Public Education (continued)      
$ 1,150     Massachusetts Health and Educational Facilities Authority,
(Worcester State College), (AMBAC), 5.00%, 11/1/32
  $ 1,199,243    
            $ 3,103,779    
Insured-Special Tax Revenue — 9.0%      
$ 1,280     Martha's Vineyard Land Bank, (AMBAC),
5.00%, 5/1/32(3)
  $ 1,335,744    
  750     Massachusetts Bay Transportation Authority,
Revenue Assessment, (MBIA), 4.00%, 7/1/33
    695,812    
  250     Massachusetts School Building Authority, Sales Tax, (FSA),
5.00%, 8/15/30
    264,778    
  500     Puerto Rico Infrastructure Financing Authority, (FGIC),
0.00%, 7/1/30
    175,995    
            $ 2,472,329    
Insured-Transportation — 16.6%      
$ 5,700     Massachusetts Turnpike Authority, (MBIA), 0.00%, 1/1/28   $ 2,218,098    
  1,250     Massachusetts Turnpike Authority, Metropolitan Highway
System, (AMBAC), 5.00%, 1/1/39
    1,283,888    
  1,000     Puerto Rico Highway and Transportation Authority, (MBIA),
5.00%, 7/1/36(1)(2)
    1,064,166    
            $ 4,566,152    
Insured-Water and Sewer — 13.6%      
$ 1,250     Massachusetts Water Resources Authority, (AMBAC),
4.00%, 8/1/40
  $ 1,134,813    
  2,500     Massachusetts Water Resources Authority, (FSA),
5.00%, 8/1/32
    2,597,875    
            $ 3,732,688    
Nursing Home — 2.7%      
$ 745     Massachusetts Development Finance Agency,
(Berkshire Retirement Community, Inc./Edgecombe),
5.15%, 7/1/31
  $ 749,537    
            $ 749,537    
Private Education — 6.7%      
$ 500     Massachusetts Development Finance Agency,
(Massachusetts College of Pharmacy),
5.75%, 7/1/33
  $ 534,300    
  750     Massachusetts Development Finance Agency,
(Middlesex School), 5.00%, 9/1/33
    775,898    
  500     Massachusetts Health and Educational Facilities Authority,
(Boston College), 5.125%, 6/1/24
    527,740    
            $ 1,837,938    

 

Principal Amount
(000's omitted)
  Security   Value  
Total Tax-Exempt Investments — 192.7%
(identified cost $49,784,629)
      $ 52,827,389    
Other Assets, Less Liabilities — (36.2)%       $ (9,905,169 )  
Auction Preferred Shares Plus Cumulative
Unpaid Dividends — (56.5)%
      $ (15,502,972 )  
Net Assets Applicable to
Common Shares — 100.0%
      $ 27,419,248    

 

AGC - Assured Guaranty Corp.

AMBAC - AMBAC Financial Group, Inc.

CIFG - CDC IXIS Financial Guaranty North America, Inc.

FGIC - Financial Guaranty Insurance Company

FSA - Financial Security Assurance, Inc.

MBIA - Municipal Bond Insurance Association

XLCA - XL Capital Assurance, Inc.

The Fund invests primarily in debt securities issued by Massachusetts municipalities. The ability of the issuers of the debt securities to meet their obligations may be affected by economic developments in a specific industry or municipality. In order to reduce the risk associated with such economic developments, at September 30, 2006, 88.7% of total investments are backed by bond insurance of various financial institutions and financial guaranty assurance agencies. The aggregate percentage insured by an individual financial institution ranged from 2.5% to 29.9% of total investments.

(1)  Security valued at fair value using methods determined in good faith by or at the direction of the Trustees.

(2)  As restated, See Note 11.

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

See notes to financial statements
20



Eaton Vance Insured Michigan Municipal Bond Fund as of September 30, 2006

PORTFOLIO OF INVESTMENTS (As Restated — See Note 11)

Tax-Exempt Investments — 181.4%      
Principal Amount
(000's omitted)
  Security   Value  
Electric Utilities — 5.6%      
$ 1,250     Michigan Strategic Fund, (Detroit Edison Pollution
Control), 5.45%, 9/1/29
  $ 1,309,112    
            $ 1,309,112    
Hospital — 19.9%      
$ 400     Michigan Hospital Finance Authority, (Chelsea Community
Hospital), 5.00%, 5/15/30
  $ 406,000    
  1,000     Michigan Hospital Finance Authority, (Oakwood Hospital),
5.75%, 4/1/32
    1,075,070    
  1,500     Michigan Hospital Finance Authority, (Sparrow Obligation
Group), 5.625%, 11/15/36
    1,584,480    
  1,500     Michigan Hospital Finance Authority, (Trinity Health),
5.375%, 12/1/30
    1,589,430    
            $ 4,654,980    
Insured-Electric Utilities — 2.3%      
$ 500     Michigan Strategic Fund, Resource Recovery,
(Detroit Edison Co.), (XLCA), 5.25%, 12/15/32
  $ 526,620    
            $ 526,620    
Insured-Escrowed / Prerefunded — 45.4%      
$ 750     Detroit School District, (School Bond Loan Fund),
Prerefunded to 5/1/12, (FSA), 5.125%, 5/1/31
  $ 808,275    
  1,150     Michigan Hospital Finance Authority, (St. John Health
System), Escrowed to Maturity, (AMBAC), 5.00%, 5/15/28
    1,181,061    
  1,000     Michigan Trunk Line, Prerefunded to 11/1/11, (FSA),
5.00%, 11/1/25
    1,066,690    
  3,275     Puerto Rico, (FGIC), Prerefunded to 7/1/12,
5.00%, 7/1/32(1)(2)
    3,519,930    
  2,205     Puerto Rico Public Buildings Authority, (CIFG),
Prerefunded to 7/1/12, 5.25%, 7/1/36(1)(2)
    2,393,097    
  1,500     Reed City Public Schools, Prerefunded to 5/1/14, (FSA),
5.00%, 5/1/29
    1,629,495    
            $ 10,598,548    
Insured-General Obligations — 21.4%      
$ 325     Brandon School District, (FSA), 4.50%, 5/1/35   $ 324,727    
  1,960     Grand Rapids and Kent County, Joint Building
Authority, (Devos Place), (MBIA), 0.00%, 12/1/27
    760,794    
  4,000     Grand Rapids and Kent County, Joint Building Authority,
(MBIA), 0.00%, 12/1/30
    1,338,680    
  750     Greenville, Public Schools, (MBIA), 5.00%, 5/1/25     784,012    
  1,330     Okemos, Public School District, (MBIA), 0.00%, 5/1/19     786,203    

 

Principal Amount
(000's omitted)
  Security   Value  
Insured-General Obligations (continued)      
$ 1,000     Van Buren Township, (Local Development Authority),
(XLCA), 4.50%, 10/1/31
  $ 997,760    
            $ 4,992,176    
Insured-Hospital — 9.3%      
$ 500     Michigan Hospital Finance Authority, Mid-Michigan
Obligation Group, (AMBAC), 5.00%, 4/15/32
  $ 516,320    
  1,590     Royal Oak, Hospital Finance Authority Revenue, (William
Beaumont Hospital), (MBIA), 5.25%, 11/15/35
    1,659,880    
            $ 2,176,200    
Insured-Lease Revenue / Certificates of
Participation — 17.0%
     
$ 1,750     Michigan House of Representatives, (AMBAC),
0.00%, 8/15/22
  $ 883,680    
  2,615     Michigan House of Representatives, (AMBAC),
0.00%, 8/15/23
    1,258,600    
  3,100     Michigan State Building Authority, (FGIC),
0.00%, 10/15/30
    962,891    
  795     Puerto Rico Public Building Authority, (CIFG),
5.25%, 7/1/36(1)(2)
    848,113    
            $ 3,953,284    
Insured-Public Education — 10.1%      
$ 1,500     Central Michigan University, (AMBAC),
5.05%, 10/1/32(3)
  $ 1,575,105    
  750     Lake Superior State University, (AMBAC), 5.125%,
11/15/26
    789,443    
            $ 2,364,548    
Insured-Sewer Revenue — 5.6%      
$ 1,250     Detroit Sewer Disposal, (FGIC), 5.125%, 7/1/31   $ 1,310,275    
            $ 1,310,275    
Insured-Special Tax Revenue — 17.9%      
$ 1,500     Lansing, Building Authority, (MBIA), 5.00%, 6/1/29   $ 1,570,440    
  1,500     Wayne Charter County, (Airport Hotel-Detroit
Metropolitan Airport), (MBIA), 5.00%, 12/1/30
    1,565,805    
  1,000     Ypsilanti, Community Utilities Authority,
(San Sewer System), (FGIC), 5.00%, 5/1/32
    1,038,180    
            $ 4,174,425    

 

See notes to financial statements
21



Eaton Vance Insured Michigan Municipal Bond Fund as of September 30, 2006

PORTFOLIO OF INVESTMENTS CONT'D (As Restated — See Note 11)

Principal Amount
(000's omitted)
  Security   Value  
Insured-Utility — 6.9%      
$ 1,000     Lansing, Board Water Supply, Steam and Electric Utility,
(FSA), 5.00%, 7/1/25
  $ 1,058,810    
  510     Lansing, Board Water Supply, Steam and Electric Utility,
(FSA), 5.00%, 7/1/26
    536,046    
            $ 1,594,856    
Insured-Water Revenue — 17.8%      
$ 1,600     Detroit Water Supply System, (FGIC), 5.00%, 7/1/30   $ 1,650,720    
  2,400     Detroit, Water Supply System, (MBIA),
5.00%, 7/1/34(1)(2)
    2,496,720    
            $ 4,147,440    
Private Education — 2.2%      
$ 500     Michigan Higher Education Facilities Authority,
(Hillsdale College), 5.00%, 3/1/35
  $ 514,495    
            $ 514,495    
  Total Tax-Exempt Investments — 181.4%
(identified cost $39,794,782)
        $ 42,316,959    
  Other Assets, Less Liabilities — (23.5)%         $ (5,477,296 )  
  Auction Preferred Shares Plus Cumulative
Unpaid Dividends — (57.9)%
        $ (13,505,029 )  
  Net Assets Applicable to
Common Shares — 100.0%
        $ 23,334,634    

 

AMBAC - AMBAC Financial Group, Inc.

CIFG - CDC IXIS Financial Guaranty North America, Inc.

FGIC - Financial Guaranty Insurance Company

FSA - Financial Security Assurance, Inc.

MBIA - Municipal Bond Insurance Association

XLCA - XL Capital Assurance, Inc.

The Fund invests primarily in debt securities issued by Michigan municipalities. The ability of the issuers of the debt securities to meet their obligations may be affected by economic developments in a specific industry or municipality. In order to reduce the risk associated with such economic developments, at September 30, 2006, 84.7% of total investments are backed by bond insurance of various financial institutions and financial guaranty assurance agencies. The aggregate percentage insured by an individual financial institution ranged from 3.6% to 25.9% of total investments.

(1)  Security valued at fair value using methods determined in good faith by or at the direction of the Trustees.

(2)  As restated, See Note 11.

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

See notes to financial statements
22




Eaton Vance Insured New Jersey Municipal Bond Fund as of September 30, 2006

PORTFOLIO OF INVESTMENTS (As Restated — See Note 11)

Tax-Exempt Investments — 177.4%      
Principal Amount
(000's omitted)
  Security   Value  
Hospital — 8.3%      
$ 100     Camden County, Improvement Authority, (Cooper Health
System), 5.00%, 2/15/25
  $ 102,925    
  180     Camden County, Improvement Authority, (Cooper Health
System), 5.00%, 2/15/35
    183,620    
  150     Camden County, Improvement Authority, (Cooper Health
System), 5.25%, 2/15/27
    157,398    
  1,300     Camden County, Improvement Authority, (Cooper Health
System), 5.75%, 2/15/34
    1,397,253    
  610     New Jersey Health Care Facilities Financing Authority,
(Capital Health System), 5.375%, 7/1/33
    636,242    
  575     New Jersey Health Care Facilities Financing Authority,
(Capital Health System), 5.75%, 7/1/23
    620,770    
  250     New Jersey Health Care Facilities Financing Authority,
(Hunterdon Medical Center), 5.125%, 7/1/35
    258,220    
            $ 3,356,428    
Insured-Escrowed / Prerefunded — 18.2%      
$ 4,645     Puerto Rico, (FGIC), Prerefunded to 7/1/12,
5.00%, 7/1/32(1)(2)
  $ 4,991,704    
  2,205     Puerto Rico Public Buildings Authority, (CIFG),
Prerefunded to 7/1/12, 5.25%, 7/1/36(1)(2)
    2,393,097    
            $ 7,384,801    
Insured-General Obligations — 30.0%      
$ 2,260     Bayonne, (FSA), 0.00%, 7/1/22   $ 1,156,103    
  2,415     Bayonne, (FSA), 0.00%, 7/1/23     1,178,134    
  1,500     Bordentown, Regional School District Board of Education,
(FGIC), 5.00%, 1/15/30(3)
    1,570,935    
  2,000     Hudson County Improvement Authority, (MBIA),
0.00%, 12/15/38
    453,540    
  5,500     Irvington Township, (FSA), 0.00%, 7/15/26     2,323,860    
  2,960     Jackson Township, School District, (MBIA), 2.50%, 6/15/27     2,259,753    
  1,250     Jersey City, (FSA), 5.25%, 9/1/23     1,350,225    
  530     Madison Borough, Board of Education, (MBIA),
4.75%, 7/15/35
    543,960    
  350     Monroe Township Board of Education, (MBIA),
4.50%, 4/1/33
    352,289    
  1,000     Old Bridge Township Board of Education, (MBIA),
4.375%, 7/15/32
    1,005,010    
            $ 12,193,809    
Insured-Hospital — 9.3%      
$ 2,750     New Jersey Health Care Facilities Financing Authority,
(Englewood Hospital), (MBIA), 5.00%, 8/1/31
  $ 2,859,120    

 

Principal Amount
(000's omitted)
  Security   Value  
Insured-Hospital (continued)      
$ 900     New Jersey Health Care Facilities Financing Authority,
(Jersey City Medical Center), (AMBAC), 5.00%, 8/1/41
  $ 925,938    
            $ 3,785,058    
Insured-Lease Revenue / Certificates of
Participation — 13.2%
     
$ 445     Gloucester County, Improvements Authority, (MBIA),
4.75%, 9/1/30
  $ 458,862    
  2,670     Lafayette Yard, Community Development Corporation,
(Hotel and Conference Center), (FGIC), 5.00%, 4/1/35
    2,748,551    
  1,250     Middlesex County, (MBIA), 5.00%, 8/1/31     1,290,825    
  795     Puerto Rico Public Buildings Authority, (CIFG),
5.25%, 7/1/36(1)(2)
    848,114    
            $ 5,346,352    
Insured-Pooled Loans — 7.3%      
$ 2,850     Puerto Rico Municipal Finance Agency, (FSA),
5.00%, 8/1/27(1)(2)
  $ 2,986,372    
            $ 2,986,372    
Insured-Private Education — 2.6%      
$ 1,000     New Jersey Educational Facilities Authority, (Kean University),
(FGIC), 5.00%, 7/1/28
  $ 1,049,870    
            $ 1,049,870    
Insured-Public Education — 18.5%      
$ 1,200     New Jersey Economic Development Authority,
(School Facilities), (FGIC), 5.00%, 7/1/33
  $ 1,248,240    
  1,500     New Jersey Educational Facilities Authority,
(Rowan University), (FGIC), 5.125%, 7/1/30
    1,586,655    
  3,990     University of New Jersey Medicine and Dentistry, (AMBAC),
5.00%, 4/15/32
    4,176,253    
  475     University of New Jersey Medicine and Dentistry, Certificates
of Participation, (MBIA), 5.00%, 6/15/36
    496,755    
            $ 7,507,903    
Insured-Sewer Revenue — 3.7%      
$ 690     Passaic Valley, Sewer Commissioners, (FGIC),
2.50%, 12/1/32
  $ 498,442    
  2,500     Rahway Valley, Sewerage Authority, (MBIA),
0.00%, 9/1/27
    999,550    
            $ 1,497,992    
Insured-Special Tax Revenue — 14.3%      
$ 10,000     Garden State, New Jersey Preservation Trust, (FSA),
0.00%, 11/1/28
  $ 3,782,600    
  1,555     Puerto Rico Infrastructure Financing Authority, (AMBAC),
0.00%, 7/1/28
    601,598    

 

See notes to financial statements
23



Eaton Vance Insured New Jersey Municipal Bond Fund as of September 30, 2006

PORTFOLIO OF INVESTMENTS CONT'D (As Restated — See Note 11)

Principal Amount
(000's omitted)
  Security   Value  
Insured-Special Tax Revenue (continued)      
$ 890     Puerto Rico Infrastructure Financing Authority, (AMBAC),
0.00%, 7/1/37
  $ 220,542    
  6,500     Puerto Rico Infrastructure Financing Authority, (AMBAC),
0.00%, 7/1/43
    1,222,975    
            $ 5,827,715    
Insured-Transportation — 29.3%      
$ 6,155     New Jersey Transportation Trust Fund Authority, (AMBAC),
0.00%, 12/15/36
  $ 1,571,679    
  600     New Jersey Turnpike Authority, (FSA), 5.25%, 1/1/30     698,304    
  800     Newark, Housing Authority, (Newark Marine Terminal),
(MBIA), 5.00%, 1/1/23
    843,968    
  1,500     Newark, Housing Authority, (Newark Marine Terminal),
(MBIA), 5.00%, 1/1/37
    1,569,030    
  3,875     Port Authority of New York and New Jersey, (FSA),
5.00%, 11/1/27(1)(2)
    4,083,593    
  1,000     Puerto Rico Highway and Transportation Authority, (MBIA),
5.00%, 7/1/33
    1,046,870    
  2,000     South Jersey, Transportation Authority, (FGIC), 5.00%,
11/1/33
    2,108,000    
            $ 11,921,444    
Insured-Water and Sewer — 5.1%      
$ 4,500     Middlesex County, Improvements Authority Utilities
System, (Perth Amboy), (AMBAC), 0.00%, 9/1/24
  $ 2,077,290    
            $ 2,077,290    
Private Education — 3.2%      
$ 1,250     New Jersey Educational Facilities Authority, (Stevens
Institute of Technology), 5.25%, 7/1/32
  $ 1,302,888    
            $ 1,302,888    
Senior Living / Life Care — 1.5%      
$ 600     New Jersey Economic Development Authority,
(Fellowship Village), 5.50%, 1/1/25
  $ 610,392    
            $ 610,392    
Special Tax Revenue — 5.0%      
$ 150     New Jersey Economic Development Authority,
(Cigarette Tax), 5.50%, 6/15/24
  $ 157,670    
  500     New Jersey Economic Development Authority,
(Cigarette Tax), 5.50%, 6/15/31
    526,445    
  500     New Jersey Economic Development Authority,
(Cigarette Tax), 5.75%, 6/15/29
    537,810    

 

Principal Amount
(000's omitted)
  Security   Value  
Special Tax Revenue (continued)      
$ 750     New Jersey Economic Development Authority,
(Cigarette Tax), 5.75%, 6/15/34
  $ 801,690    
            $ 2,023,615    
Transportation — 7.9%      
$ 1,250     Port Authority of New York and New Jersey,
5.00%, 9/1/38
  $ 1,306,975    
  1,825     South Jersey, Port Authority, (Marine Terminal),
5.10%, 1/1/33
    1,895,591    
            $ 3,202,566    
  Total Tax-Exempt Investments — 177.4%
(identified cost $67,439,526)
        $ 72,074,494    
  Other Assets, Less Liabilities — (22.0)%         $ (8,945,210 )  
  Auction Preferred Shares Plus Cumulative
Unpaid Dividends — (55.4)%
        $ (22,509,629 )  
  Net Assets Applicable to
Common Shares — 100.0%
        $ 40,619,655    

 

AMBAC - AMBAC Financial Group, Inc.

CIFG - CDC IXIS Financial Guaranty North America, Inc.

FGIC - Financial Guaranty Insurance Company

FSA - Financial Security Assurance, Inc.

MBIA - Municipal Bond Insurance Association

The Fund invests primarily in debt securities issued by New Jersey municipalities. The ability of the issuers of the debt securities to meet their obligations may be affected by economic developments in a specific industry or municipality. In order to reduce the risk associated with such economic developments, at September 30, 2006, 85.4% of total investments are backed by bond insurance of various financial institutions and financial guaranty assurance agencies. The aggregate percentage insured by an individual financial institution ranged from 4.5% to 24.4% of total investments.

(1)  Security valued at fair value using methods determined in good faith by or at the direction of the Trustees.

(2)  As restated, See Note 11.

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

See notes to financial statements
24



Eaton Vance Insured New York Municipal Bond Fund II as of September 30, 2006

PORTFOLIO OF INVESTMENTS (As Restated — See Note 11)

Tax-Exempt Investments — 165.4%      
Principal Amount
(000's omitted)
  Security   Value  
Electric Utilities — 1.7%      
$ 665     Long Island Power Authority, Electric System Revenue,
5.00%, 12/1/35
  $ 694,253    
            $ 694,253    
General Obligations — 8.3%      
$ 1,000     New York, 5.00%, 6/1/30   $ 1,048,030    
  1,650     New York, 5.25%, 1/15/28     1,750,006    
  500     New York City, 5.25%, 8/15/26     536,090    
            $ 3,334,126    
Hospital — 2.0%      
$ 750     Suffolk County Industrial Development Agency, (Huntington
Hospital), 5.875%, 11/1/32
  $ 798,202    
            $ 798,202    
Industrial Development Revenue — 2.9%      
$ 1,160     New York City Industrial Development Agency,
(Liberty-IAC/Interactive Corp.), 5.00%, 9/1/35
  $ 1,181,274    
            $ 1,181,274    
Insured-Electric Utilities — 5.9%      
$ 2,250     Long Island Power Authority, (AMBAC), 5.00%, 9/1/34   $ 2,362,118    
            $ 2,362,118    
Insured-Escrowed / Prerefunded — 11.6%      
$ 580     New York City Cultural Resource Trust, (Museum of History),
(AMBAC), Prerefunded to 7/1/19, Variable Rate,
9.189%, 7/1/29(1)(2)
  $ 693,912    
  1,500     Puerto Rico, (FGIC), Prerefunded to 7/1/12,
5.0%, 7/1/32(4)(5)
    1,611,840    
  2,205     Puerto Rico Public Buildings Authority, (CIFG),
Prerefunded to 7/1/12, 5.25%, 7/1/36(4)(5)
    2,393,097    
            $ 4,698,849    
Insured-General Obligations — 9.7%      
$ 2,245     New York Dormitory Authority, (School Districts Financing
Program), (MBIA), 5.00%, 10/1/30
  $ 2,340,053    
  1,500     Sachem School District, (MBIA), 5.00%, 6/15/27     1,586,985    
            $ 3,927,038    
Insured-Lease Revenue / Certificates of
Participation — 2.2%
     
$ 795     Puerto Rico Public Building Authority, (CIFG),
5.25%, 7/1/36(4)(5)
  $ 848,114    
            $ 848,114    

 

Principal Amount
(000's omitted)
  Security   Value  
Insured-Other Revenue — 23.6%      
$ 1,930     New York City Cultural Resource Trust, (American Museum
of Natural History), (MBIA), 5.00%, 7/1/44
  $ 2,011,967    
  2,000     New York City Cultural Resource Trust, (Museum of Modern
Art), (AMBAC), 5.125%, 7/1/31
    2,112,420    
  2,000     New York City Industrial Development Agency, (Queens
Baseball Stadium), (AMBAC), 4.75%, 1/1/42
    2,036,460    
  1,750     New York City Industrial Development Agency,
(Yankee Stadium), (FGIC), 4.50%, 3/1/39
    1,746,973    
  1,575     New York City Industrial Development Agency,
(Yankee Stadium), (MBIA), 4.75%, 3/1/46
    1,603,649    
            $ 9,511,469    
Insured-Private Education — 22.1%      
$ 1,000     New York City Industrial Development Agency,
(New York University), (AMBAC), 5.00%, 7/1/31
  $ 1,033,440    
  2,500     New York Dormitory Authority, (Brooklyn Law School),
(XLCA), 5.125%, 7/1/30
    2,632,375    
  2,265     New York Dormitory Authority, (FIT Student Housing Corp.),
(FGIC), 5.00%, 7/1/29
    2,387,582    
  605     New York Dormitory Authority, (Fordham University),
(FGIC), 5.00%, 7/1/32
    633,447    
  1,000     New York Dormitory Authority, (New York University),
(AMBAC), 5.00%, 7/1/31
    1,033,440    
  500     New York Dormitory Authority, (Skidmore College), (FGIC),
5.00%, 7/1/33
    524,690    
  625     New York Dormitory Authority, (University of Rochester),
(MBIA), 5.00%, 7/1/27
    643,438    
            $ 8,888,412    
Insured-Public Education — 4.3%      
$ 1,500     New York Dormitory Authority, (Educational Housing
Services), (AMBAC), 5.25%, 7/1/30
  $ 1,726,560    
            $ 1,726,560    
Insured-Special Tax Revenue — 14.0%      
$ 700     New York Convention Center Development Corp.,
Hotel Occupancy Tax, (AMBAC), 4.75%, 11/15/45
  $ 711,949    
  400     New York Convention Center Development Corp., Hotel
Occupancy Tax, (AMBAC), 5.00%, 11/15/44
    418,228    
  1,385     Puerto Rico Infrastructure Financing Authority, (AMBAC),
0.00%, 7/1/28
    535,829    
  1,700     Puerto Rico Infrastructure Financing Authority, (AMBAC),
0.00%, 7/1/35
    463,488    
  740     Puerto Rico Infrastructure Financing Authority, (AMBAC),
0.00%, 7/1/37
    183,372    
  2,500     Puerto Rico Infrastructure Financing Authority, (FGIC),
0.00%, 7/1/33
    752,350    

 

See notes to financial statements
25



Eaton Vance Insured New York Municipal Bond Fund II as of September 30, 2006

PORTFOLIO OF INVESTMENTS CONT'D (As Restated — See Note 11)

Principal Amount
(000's omitted)
  Security   Value  
Insured-Special Tax Revenue (continued)      
$ 14,975     Puerto Rico Infrastructure Financing Authority, (FGIC),
0.00%, 7/1/45
  $ 2,560,126    
            $ 5,625,342    
Insured-Transportation — 26.0%      
$ 2,000     Metropolitan Transportation Authority, Transportation
Revenue Bonds, (FGIC), 5.25%, 11/15/31
  $ 2,141,320    
  2,500     Port Authority of New York and New Jersey, (FSA),
5.0%, 11/1/27(4)(5)
    2,635,020    
  1,000     Puerto Rico Highway and Transportation Authority,
(AMBAC), Variable Rate, 7.164%, 7/1/28(1)(2)
    1,085,400    
  375     Puerto Rico Highway and Transportation Authority,
(CIFG), 5.25%, 7/1/41
    436,298    
  2,000     Puerto Rico Highway and Transportation Authority,
(MBIA), 5.00%, 7/1/33
    2,093,740    
  2,000     Triborough Bridge and Tunnel Authority, (MBIA),
5.00%, 11/15/32
    2,081,720    
            $ 10,473,498    
Insured-Water and Sewer — 14.0%      
$ 3,000     New York City Municipal Water Finance Authority,
(AMBAC), 5.00%, 6/15/38(3)
  $ 3,121,980    
  2,400     Niagara Falls Public Water Authority and Sewer System,
(MBIA), 5.00%, 7/15/34
    2,504,976    
            $ 5,626,956    
Insured-Water Revenue — 5.5%      
$ 2,215     New York Environmental Facilities Corp., (MBIA),
4.25%, 6/15/28
  $ 2,200,890    
            $ 2,200,890    
Other Revenue — 1.5%      
$ 500     Puerto Rico Infrastructure Financing Authority, Variable Rate,
7.218%, 10/1/32(1)(2)
  $ 617,555    
            $ 617,555    
Private Education — 5.1%      
$ 1,000     Dutchess County, Industrial Development Agency,
(Marist College), 5.00%, 7/1/22
  $ 1,041,490    
  1,000     New York City Industrial Development Agency,
(St. Francis College), 5.00%, 10/1/34
    1,035,880    
            $ 2,077,370    

 

Principal Amount
(000's omitted)
  Security   Value  
Transportation — 2.6%  
$ 1,000     Port Authority of New York and New Jersey,
5.00%, 9/1/38
  $ 1,045,580    
        $ 1,045,580    
Water Revenue — 2.4%  
$ 950     New York State Environmental Facilities Corp.,
Clean Water, (Municipal Water Finance),
4.50%, 6/15/36
  $ 952,537    
        $ 952,537    
Total Tax-Exempt Investments — 165.4%
(identified cost $63,530,603)
      $ 66,590,142    
Other Assets, Less Liabilities — (9.5)%       $ (3,818,873 )  
Auction Preferred Shares Plus Cumulative
Unpaid Dividends — (55.9)%
      $ (22,508,135 )  
Net Assets Applicable to
Common Shares— 100.0%
      $ 40,263,134    

 

AMBAC - AMBAC Financial Group, Inc.

CIFG - CDC IXIS Financial Guaranty North America, Inc.

FGIC - Financial Guaranty Insurance Company

FSA - Financial Security Assurance, Inc.

MBIA - Municipal Bond Insurance Association

XLCA - XL Capital Assurance, Inc.

The Fund invests primarily in debt securities issued by New York municipalities. The ability of the issuers of the debt securities to meet their obligations may be affected by economic developments in a specific industry or municipality. In order to reduce the risk associated with such economic developments, at September 30, 2006, 83.9% of total investments are backed by bond insurance of various financial institutions and financial guaranty assurance agencies. The aggregate percentage insured by an individual financial institution ranged from 4.0% to 26.3% of total investments.

(1)  Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be sold in transactions exempt from registration, normally to qualified institutional buyers. At September 30, 2006, the aggregate value of the securities is $2,396,867 or 6.0% of the Fund's net assets applicable to common shares.

(2)  Security has been issued as a leveraged inverse floater bond. The stated interest rate represents the rate in effect at September 30, 2006.

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

(4)  Security valued at fair value using methods determined in good faith by or at the direction of the Trustees.

(5)  As restated, See Note 11.

See notes to financial statements
26



Eaton Vance Insured Ohio Municipal Bond Fund as of September 30, 2006

PORTFOLIO OF INVESTMENTS (As Restated — See Note 11)

Tax-Exempt Investments — 167.4%      
Principal Amount
(000's omitted)
 
Security
 
Value
 
Electric Utilities — 2.7%      
$ 1,000     Puerto Rico Electric Power Authority, 5.125%, 7/1/29   $ 1,053,850    
          $ 1,053,850    
Hospital — 3.9%      
$ 900     Cuyahoga County, (Cleveland Clinic Health System),
5.50%, 1/1/29
  $ 962,946    
  500     Miami, (Upper Valley Medical Center), 5.25%, 5/15/26     532,230    
          $ 1,495,176    
Insured-Electric Utilities — 20.7%      
$ 1,500     Ohio Air Quality Development Authority, (Dayton Power &
Light Co.), (FGIC), 4.80%, 1/1/34
  $ 1,537,515    
  4,000     Ohio Municipal Electric Generation Agency, (MBIA),
0.00%, 2/15/25
    1,787,920    
  1,775     Ohio Municipal Electric Generation Agency, (MBIA),
0.00%, 2/15/26
    756,505    
  5,000     Ohio Municipal Electric Generation Agency, (MBIA),
0.00%, 2/15/27
    2,031,100    
  1,800     Puerto Rico Electric Power Authority, (MBIA),
4.75%, 7/1/33(5)(6)
    1,848,540    
          $ 7,961,580    
Insured-Escrowed / Prerefunded — 9.4%      
$ 2,205     Puerto Rico Public Buildings Authority, (CIFG),
Prerefunded to 7/1/12, 5.25%, 7/1/36(5)(6)
  $ 2,393,097    
  615     Puerto Rico Infrastructure Financing Authority, (AMBAC),
Prerefunded to 1/1/08, Variable Rate,
6.832%, 7/1/28(1)(2)
    664,471    
  500     University of Akron, (FGIC), Prerefunded to 1/1/10,
Variable Rate, 7.44%, 1/1/29(1)(3)
    576,730    
          $ 3,634,298    
Insured-General Obligations — 50.9%      
$ 1,500     Ashtabula, School District, (Construction Improvements),
(FGIC), 5.00%, 12/1/30(4)
  $ 1,564,155    
  1,000     Cleveland, Municipal School District, (FSA),
5.00%, 12/1/27
    1,056,320    
  1,500     Columbus, School District, (FSA), 5.00%, 12/1/32     1,635,480    
  2,075     Cuyahoga, Community College District, (AMBAC),
5.00%, 12/1/32
    2,170,886    
  500     Hilliard, School District, (MBIA), 5.00%, 12/1/27     536,020    
  600     Lakota, School District, (FGIC), 5.25%, 12/1/26     695,394    

 

Principal Amount
(000's omitted)
 
Security
 
Value
 
Insured-General Obligations (continued)      
$ 2,500     Olentangy, School District, (School Facility Construction and
Improvements), (MBIA), 5.00%, 12/1/30
  $ 2,606,925    
  2,400     Plain, School District, (FGIC), 0.00%, 12/1/27     899,952    
  1,400     Powell, (FGIC), 5.50%, 12/1/32     1,521,744    
  2,500     Springboro, Community School District, (MBIA),
5.00%, 12/1/32
    2,629,050    
  500     Tecumseh, School District, (FGIC), 4.75%, 12/1/31     513,085    
  2,600     Trotwood-Madison, City School District, (School
Improvements), (FGIC), 5.00%, 12/1/30
    2,714,062    
  1,000     Zanesville, School District, (School Improvements), (MBIA),
5.05%, 12/1/29
    1,056,720    
          $ 19,599,793    
Insured-Hospital — 6.8%      
$ 1,000     Hamilton County, (Cincinnati Children's Hospital), (FGIC),
5.00%, 5/15/32
  $ 1,045,590    
  1,500     Hamilton County, (Cincinnati Children's Hospital), (FGIC),
5.125%, 5/15/28
    1,586,175    
          $ 2,631,765    
Insured-Lease Revenue / Certificates of
Participation — 8.2%
     
$ 1,000     Cleveland, (Cleveland Stadium), (AMBAC),
5.25%, 11/15/27
  $ 1,033,850    
  795     Puerto Rico Public Buildings Authority, (CIFG),
5.25%, 7/1/36(5)(6)
    848,114    
  235     Puerto Rico Public Buildings Authority, Government Facilities
Revenue, (XLCA), 5.25%, 7/1/36
    250,700    
  1,000     Summit County, (Civic Theater Project), (AMBAC),
5.00%, 12/1/33
    1,034,200    
          $ 3,166,864    
Insured-Pooled Loans — 2.3%      
$ 850     Puerto Rico Municipal Finance Agency, (FSA),
5.00%, 8/1/27(5)(6)
  $ 890,194    
          $ 890,194    
Insured-Public Education — 14.2%      
$ 3,000     Cincinnati, Technical and Community College, (AMBAC),
5.00%, 10/1/28
  $ 3,152,700    
  1,170     Ohio University, (FSA), 5.25%, 12/1/23     1,269,450    
  1,000     University of Cincinnati, (AMBAC), 5.00%, 6/1/31     1,041,660    
          $ 5,463,810    
Insured-Sewer Revenue — 2.9%      
$ 1,100     Marysville Wastewater Treatment System, (XLCA),
4.75%, 12/1/46
  $ 1,105,489    
          $ 1,105,489    

 

See notes to financial statements
27



Eaton Vance Insured Ohio Municipal Bond Fund as of September 30, 2006

PORTFOLIO OF INVESTMENTS CONT'D (As Restated — See Note 11)

Principal Amount
(000's omitted)
 
Security
 
Value
 
Insured-Special Tax Revenue — 12.9%      
$ 4,315     Hamilton County, Sales Tax, (AMBAC), 0.00%, 12/1/22   $ 2,148,050    
  5,000     Hamilton County, Sales Tax, (AMBAC), 0.00%, 12/1/23     2,372,000    
  1,000     Hamilton County, Sales Tax, (AMBAC), 0.00%, 12/1/24     452,630    
          $ 4,972,680    
Insured-Transportation — 14.7%      
$ 4,000     Cleveland, Airport System, (FSA), 5.00%, 1/1/31   $ 4,114,640    
  885     Puerto Rico Highway and Transportation Authority, (AMBAC),
Variable Rate, 7.164%, 7/1/28(1)(2)
    960,579    
  500     Puerto Rico Highway and Transportation Authority, (CIFG),
5.25%, 7/1/41
    581,730    
          $ 5,656,949    
Pooled Loans — 7.3%      
$ 1,500     Cuyahoga County Port Authority, (Garfield Heights),
5.25%, 5/15/23
  $ 1,545,045    
  1,150     Rickenbacker, Port Authority, Oasbo Expanded Asset
Pooled Loan, 5.375%, 1/1/32
    1,277,627    
          $ 2,822,672    
Private Education — 10.5%      
$ 850     Ohio Higher Educational Facilities Authority, (John Carroll
University), 5.25%, 11/15/33
  $ 902,564    
  1,000     Ohio Higher Educational Facilities Authority, (Oberlin College),
5.00%, 10/1/33
    1,042,880    
  1,821     Ohio Higher Educational Facilities Authority, (Oberlin College),
5.00%, 10/1/29(5)(6)
    1,913,089    
  179     Ohio Higher Educational Facilities Authority, (Oberlin College),
5.25%, 10/1/29(5)(6)
    184,331    
          $ 4,042,864    
  Total Tax-Exempt Investments — 167.4%
(identified cost $60,816,349)
        $ 64,497,983    
  Other Assets, Less Liabilities — (10.6)%         $ (4,091,413 )  
  Auction Preferred Shares Plus Cumulative
Unpaid Dividends — (56.8)%
        $ (21,875,000 )  
  Net Assets Applicable to
Common Shares — 100.0%
        $ 38,531,570    

 

AMBAC - AMBAC Financial Group, Inc.

CIFG - CDC IXIS Financial Guaranty North America, Inc.

FGIC - Financial Guaranty Insurance Company

FSA - Financial Security Assurance, Inc.

MBIA - Municipal Bond Insurance Association

XLCA - XL Capital Assurance, Inc.

The Fund invests primarily in debt securities issued by Ohio municipalities. The ability of the issuers of the debt securities to meet their obligations may be affected by economic developments in a specific industry or municipality. In order to reduce the risk associated with such economic developments, at September 30, 2006, 85.4% of total investments are backed by bond insurance of various financial institutions and financial guaranty assurance agencies. The aggregate percentage insured by an individual financial institution ranged from 2.1% to 23.3% of total investments.

(1)  Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be sold in transactions exempt from registration, normally to qualified institutional buyers. At September 30, 2006, the aggregate value of the securities is $2,201,780 or 5.7% of the Fund's net assets applicable to common shares.

(2)  Security has been issued as a leveraged inverse floater bond. The stated interest rate represents the rate in effect at September 30, 2006.

(3)  Security has been issued as an inverse floater bond. The stated interest rate represents the rate in effect at September 30, 2006.

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

(5)  Security valued at fair value using methods determined in good faith by or at the direction of the Trustees.

(6)  As restated, See Note 11.

See notes to financial statements
28



Eaton Vance Insured Pennsylvania Municipal Bond Fund as of September 30, 2006

PORTFOLIO OF INVESTMENTS (As Restated — See Note 11)

Tax-Exempt Investments — 178.6%      
Principal Amount
(000's omitted)
 
Security
 
Value
 
Electric Utilities — 1.5%      
$ 650     Puerto Rico Electric Power Authority,
5.125%, 7/1/29(1)(2)
  $ 685,006    
          $ 685,006    
Hospital — 7.9%      
$ 750     Lancaster County, Hospital Authority, 5.50%, 3/15/26   $ 802,702    
  350     Lebanon County Health Facility Authority, (Good Samaritan
Hospital), 6.00%, 11/15/35
    378,651    
  1,500     Lehigh County, General Purpose Authority, (Lehigh Valley
Health Network), 5.25%, 7/1/32
    1,580,385    
  750     Pennsylvania Higher Educational Facilities Authority, (UPMC
Health System), 6.00%, 1/15/31
    818,340    
          $ 3,580,078    
Insured-Education — 4.2%      
$ 1,900     Pennsylvania Higher Educational Facilities Authority, (Temple
University), (MBIA), 4.50%, 4/1/36(3)
  $ 1,898,461    
          $ 1,898,461    
Insured-Electric Utilities — 9.2%      
$ 3,615     Lehigh County Industrial Development Authority, (PPL Electric
Utilities Corp.), (FGIC), 4.75%, 2/15/27
  $ 3,709,062    
  400     Puerto Rico Electric Power Authority, (FSA), Variable Rate,
7.73%, 7/1/29(4)(5)
    469,840    
          $ 4,178,902    
Insured-Escrowed / Prerefunded — 17.6%      
$ 1,000     Butler School District, (FSA), Prerefunded to 4/1/14,
5.00%, 4/1/31
  $ 1,085,540    
  2,500     Pennsylvania Higher Educational Facilities Authority,
(Temple University), (MBIA), Prerefunded to 4/1/08,
5.00%, 4/1/29
    2,577,700    
  1,355     Philadelphia Natural Gas Works, (FSA), Prerefunded to
8/1/11, 5.125%, 8/1/31
    1,449,186    
  1,200     Puerto Rico, (FGIC), Prerefunded to 7/1/12,
5.00%, 7/1/32(1)(2)
    1,289,472    
  270     Southcentral General Authority, (MBIA), Escrowed to Maturity,
5.25%, 5/15/31
    288,206    
  1,230     Southcentral General Authority, (MBIA), Prerefunded to
5/1/11, 5.25%, 5/15/31
    1,326,457    
          $ 8,016,561    

 

Principal Amount
(000's omitted)
 
Security
 
Value
 
Insured-General Obligations — 33.3%      
$ 1,650     Armstrong County, (MBIA), 5.40%, 6/1/31   $ 1,757,299    
  4,845     Canon McMillan School District, (FGIC), 0.00%, 12/1/33     1,423,073    
  500     Canon McMillan School District, (FGIC), 5.25%, 12/1/34     534,140    
  1,000     Erie School District, (AMBAC), 0.00%, 9/1/30     343,910    
  1,000     Gateway School District, Alleghany County, (FGIC),
5.00%, 10/15/32
    1,047,400    
  2,555     McKeesport School District, (MBIA), 0.00%, 10/1/21     1,331,666    
  2,000     Pennridge School District, (MBIA), 5.00%, 2/15/29     2,092,600    
  500     Philadelphia, (FSA), 5.00%, 9/15/31     515,390    
  1,750     Philadelphia, (FSA), 5.00%, 9/15/31(1)(2)     1,804,031    
  1,000     Pine-Richland School District, (FSA), 5.00%, 9/1/29     1,036,780    
  2,550     Shaler Area School District, (XLCA), 0.00%, 9/1/33     757,478    
  1,390     Steel Valley School District, Allegheny County, (FSA),
0.00%, 11/1/29
    504,848    
  1,390     Steel Valley School District, Allegheny County, (FSA),
0.00%, 11/1/30
    479,772    
  1,290     Steel Valley School District, Allegheny County, (FSA),
0.00%, 11/1/31
    421,869    
  1,060     Upper Clair Township, School District, (FSA),
5.00%, 7/15/32
    1,102,315    
          $ 15,152,571    
Insured-Hospital — 2.2%      
$ 1,000     Washington County Hospital Authority, (Washington Hospital),
(AMBAC), 5.125%, 7/1/28
  $ 1,027,980    
          $ 1,027,980    
Insured-Industrial Development Revenue — 3.9%      
$ 1,700     Allegheny County Industrial Development Authority, (MBIA),
5.00%, 11/1/29
  $ 1,775,582    
          $ 1,775,582    
Insured-Lease Revenue / Certificates of
Participation — 7.0%
     
$ 1,300     Philadelphia, Authority for Industrial Development Lease
Revenue, (FSA), 5.125%, 10/1/26
  $ 1,372,891    
  1,700     Philadelphia, Authority for Industrial Development Lease
Revenue, (FSA), 5.25%, 10/1/30
    1,797,971    
          $ 3,170,862    
Insured-Other — 1.0%      
$ 450     Erie County Convention Center Authority, (FGIC),
5.00%, 1/15/36
  $ 471,272    
          $ 471,272    

 

See notes to financial statements
29



Eaton Vance Insured Pennsylvania Municipal Bond Fund as of September 30, 2006

PORTFOLIO OF INVESTMENTS CONT'D (As Restated — See Note 11)

Principal Amount
(000's omitted)
 
Security
 
Value
 
Insured-Private Education — 9.8%      
$ 1,000     Chester County Industrial Development Authority
Educational Facility, (Westtown School), (AMBAC),
5.00%, 1/1/31
  $ 1,037,550    
  3,315     Delaware County, (Villanova University), (MBIA),
5.00%, 12/1/28
    3,416,340    
          $ 4,453,890    
Insured-Public Education — 7.9%      
$ 2,400     Lycoming County, College Authority, (Pennsylvania
College of Technology), (AMBAC), 5.25%, 5/1/32
  $ 2,550,072    
  1,000     Pennsylvania Higher Educational Facilities Authority,
(Clarion University Foundation), (XLCA), 5.00%, 7/1/33
    1,040,900    
          $ 3,590,972    
Insured-Special Tax Revenue — 15.8%      
$ 4,350     Pittsburgh and Allegheny County Public Auditorium Authority,
(AMBAC), 5.00%, 2/1/29
  $ 4,503,164    
  1,925     Puerto Rico Infrastructure Financing Authority, (AMBAC),
0.00%, 7/1/28
    744,744    
  1,180     Puerto Rico Infrastructure Financing Authority, (AMBAC),
0.00%, 7/1/37
    292,404    
  8,700     Puerto Rico Infrastructure Financing Authority, (AMBAC),
0.00%, 7/1/43
    1,636,905    
          $ 7,177,217    
Insured-Transportation — 25.2%      
$ 2,000     Allegheny County Port Authority, (FGIC), 5.00%, 3/1/25   $ 2,103,200    
  1,000     Allegheny County, Port Authority, (FGIC), 5.00%, 3/1/29     1,040,120    
  800     Pennsylvania Turnpike Commission, (FSA),
5.25%, 1/15/23(1)(2)
    926,624    
  2,450     Puerto Rico Highway and Transportation Authority, (MBIA),
5.00%, 7/1/36(1)(2)
    2,606,105    
  2,100     Puerto Rico Highway and Transportation Authority,
(CIFG), 5.25%, 7/1/41(1)(2)
    2,443,280    
  2,050     Pennsylvania Turnpike Commission, (FSA),
5.25%, 1/15/23(1)(2)
    2,387,014    
          $ 11,506,343    
Insured-Water and Sewer — 21.1%      
$ 1,555     Erie Sewer Authority, (AMBAC), 0.00%, 12/1/25   $ 670,018    
  2,155     Erie Sewer Authority, (AMBAC), 0.00%, 12/1/25     928,546    
  1,920     Erie Sewer Authority, (AMBAC), 0.00%, 12/1/26     790,176    
  1,500     Pennsylvania University Sewer Authority, (MBIA),
5.00%, 11/1/26
    1,561,035    
  3,000     Philadelphia Water and Wastewater, (FGIC),
5.00%, 11/1/31(1)(2)
    3,120,300    
  1,750     Pittsburgh Water and Sewer Authority, (AMBAC),
5.125%, 12/1/27(1)(2)
    1,844,755    

 

Principal Amount
(000's omitted)
 
Security
 
Value
 
Insured-Water and Sewer (continued)      
$ 650     Saxonburg Water and Sewer Authority, (AGC),
5.00%, 3/1/35
  $ 684,151    
          $ 9,598,981    
Private Education — 6.7%      
$ 3,000     Pennsylvania Higher Educational Facilities Authority,
(University of Pennsylvania), 4.75%, 7/15/35
  $ 3,059,250    
          $ 3,059,250    
Senior Living / Life Changes — 1.1%      
$ 200     Montgomery County Industrial Development Authority,
(Foulkeways at Gwynedd), 5.00%, 12/1/24
  $ 205,390    
  300     Montgomery County Industrial Development Authority,
(Foulkeways at Gwynedd), 5.00%, 12/1/30
    305,976    
          $ 511,366    
Transportation — 3.2%      
$ 1,400     Delaware River Joint Toll Bridge Commission,
5.00%, 7/1/28
  $ 1,456,420    
          $ 1,456,420    
  Total Tax-Exempt Investments — 178.6%
(identified cost $77,179,524)
        $ 81,311,714    
  Other Assets, Less Liabilities — (21.5)%         $ (9,790,768 )  
  Auction Preferred Shares Plus Cumulative
Unpaid Dividends — (57.1)%
        $ (26,004,573 )  
  Net Assets Applicable to
Common Shares — 100.0%
        $ 45,516,373    

 

AGC - Assured Guaranty Corp.

AMBAC - AMBAC Financial Group, Inc.

CIFG - CDC IXIS Financial Guaranty North America, Inc.

FGIC - Financial Guaranty Insurance Company

FSA - Financial Security Assurance, Inc.

MBIA - Municipal Bond Insurance Association

XLCA - XL Capital Assurance, Inc.

The Fund invests primarily in debt securities issued by Pennsylvania municipalities. The ability of the issuers of the debt securities to meet their obligations may be affected by economic developments in a specific industry or municipality. In order to reduce the risk associated with such economic developments, at

See notes to financial statements
30



Eaton Vance Insured Pennsylvania Municipal Bond Fund as of September 30, 2006

PORTFOLIO OF INVESTMENTS CONT'D (As Restated — See Note 11)

September 30, 2006, 88.6% of total investments are backed by bond insurance of various financial institutions and financial guaranty assurance agencies. The aggregate percentage insured by an individual financial institution ranged from 0.8% to 25.4% of total investments.

(1)  Security valued at fair value using methods determined in good faith by or at the direction of the Trustees.

(2)  As restated, See Note 11.

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

(4)  Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be sold in transactions exempt from registration, normally to qualified institutional buyers. At September 30, 2006, the aggregate value of the securities is $469,840 or 1.0% of the Fund's net assets applicable to common shares.

(5)  Security has been issued as a leveraged inverse floater bond. The stated interest rate represents the rate in effect at September 30, 2006.

See notes to financial statements
31




Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FINANCIAL STATEMENTS

Statements of Assets and Liabilities (As Restated — See Note 11)

As of September 30, 2006

    Insured
Municipal Fund II
  Insured
California Fund II
  Insured
Florida Fund
 
Assets  
Investments —  
Identified cost   $ 267,529,131     $ 94,607,941     $ 61,688,482    
Unrealized appreciation     17,191,125       5,411,235       3,282,517    
Investments, at value   $ 284,720,256     $ 100,019,176     $ 64,970,999    
Cash   $ 247,602     $     $    
Receivable for investments sold     331,573             1,180,408    
Interest receivable     3,513,828       976,262       1,041,418    
Total assets   $ 288,813,259     $ 100,995,438     $ 67,192,825    
Liabilities  
Payable for when-issued securities   $ 3,587,407     $     $    
Due to custodian           308,647       368,473    
Payable to affiliate for investment advisory fees     80,332       30,493       20,214    
Payable for floating rate notes issued     39,570,000       7,550,000       5,055,000    
Interest expense and fees payable     502,991       87,934       56,071    
Accrued expenses     101,075       59,466       53,306    
Total liabilities   $ 43,841,805     $ 8,036,540     $ 5,553,064    
Auction preferred shares at liquidation value plus cumulative unpaid dividends     87,508,569       33,759,430       22,510,941    
Net assets applicable to common shares   $ 157,462,885     $ 59,199,468     $ 39,128,820    
Sources of Net Assets  
Common Shares, $0.01 par value, unlimited number of shares authorized   $ 99,254     $ 38,619     $ 25,755    
Additional paid-in capital     140,750,922       54,744,606       36,515,052    
Accumulated net realized gain (loss) (computed on the basis of identified cost)     453,263       (832,690 )     (501,469 )  
Undistributed net investment income     184,615       94,976       29,450    
Net unrealized appreciation (computed on the basis of identified cost)     15,974,831       5,153,957       3,060,032    
Net assets applicable to common shares   $ 157,462,885     $ 59,199,468     $ 39,128,820    
Auction Preferred Shares Issued and Outstanding
(Liquidation preference of $25,000 per share)
    3,500       1,350       900    
Common Shares Outstanding     9,925,378       3,861,925       2,575,502    
Net Asset Value Per Common Share  
Net assets applicable to common shares ÷ common shares issued and outstanding   $ 15.86     $ 15.33     $ 15.19    

 

See notes to financial statements
32



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FINANCIAL STATEMENTS CONT'D

Statements of Assets and Liabilities (As Restated — See Note 11)

As of September 30, 2006

    Insured
Massachusetts Fund
  Insured
Michigan Fund
  Insured
New Jersey Fund
 
Assets  
Investments —  
Identified cost   $ 49,784,629     $ 39,794,782     $ 67,439,526    
Unrealized appreciation     3,042,760       2,522,177       4,634,968    
Investments, at value   $ 52,827,389     $ 42,316,959     $ 72,074,494    
Cash   $     $     $ 69,956    
Receivable from the transfer agent     2,971             5,140    
Interest receivable     600,144       565,662       711,885    
Total assets   $ 53,430,504     $ 42,882,621     $ 72,861,475    
Liabilities  
Due to custodian   $ 10,993     $ 152,944     $    
Payable to affiliate for investment advisory fees     14,060       12,075       20,634    
Payable to affiliate for inverse floaters     1,586,200                
Payable for floating rate notes issued     8,765,000       5,780,000       9,580,000    
Interest expense and fees payable     83,574       55,264       85,604    
Accrued expenses     48,457       42,675       45,953    
Total liabilities   $ 10,508,284     $ 6,042,958     $ 9,732,191    
Auction preferred shares at liquidation value plus cumulative unpaid dividends     15,502,972       13,505,029       22,509,629    
Net assets applicable to common shares   $ 27,419,248     $ 23,334,634     $ 40,619,655    
Sources of Net Assets  
Common Shares, $0.01 par value, unlimited number of shares authorized   $ 17,532     $ 15,118     $ 25,638    
Additional paid-in capital     24,841,440       21,413,714       36,341,705    
Accumulated net realized loss (computed on the basis of identified cost)     (378,536 )     (564,722 )     (214,341 )  
Undistributed net investment income     44,610       33,700       60,235    
Net unrealized appreciation (computed on the basis of identified cost)     2,894,202       2,436,824       4,406,418    
Net assets applicable to common shares   $ 27,419,248     $ 23,334,634     $ 40,619,655    
Auction Preferred Shares Issued and Outstanding
(Liquidation preference of $25,000 per share)
    620       540       900    
Common Shares Outstanding     1,753,163       1,511,845       2,563,836    
Net Asset Value Per Common Share  
Net assets applicable to common shares ÷ common shares issued and outstanding   $ 15.64     $ 15.43     $ 15.84    

 

See notes to financial statements
33



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FINANCIAL STATEMENTS CONT'D

Statements of Assets and Liabilities (As Restated — See Note 11)

As of September 30, 2006

    Insured
New York Fund II
  Insured
Ohio Fund
  Insured
Pennsylvania Fund
 
Assets  
Investments —  
Identified cost   $ 63,530,603     $ 60,816,349     $ 77,179,524    
Unrealized appreciation     3,059,539       3,681,634       4,132,190    
Investments, at value   $ 66,590,142     $ 64,497,983     $ 81,311,714    
Cash   $ 163,965     $     $ 452,814    
Receivable for investments sold           1,168,760          
Receivable from the transfer agent           1,948          
Interest receivable     806,490       846,479       929,378    
Total assets   $ 67,560,597     $ 66,515,170     $ 82,693,906    
Liabilities  
Payable for open swap contracts   $     $     $ 498,658    
Payable for closed swap contracts                 107,000    
Due to custodian           1,209,049          
Payable for floating rate notes issued     4,665,000       4,770,000       10,395,000    
Interest expense and fees payable     55,039       55,983       104,563    
Payable to affiliate for Trustees' fees     69             67    
Payable to affiliate for investment advisory fees     20,593       19,807       23,423    
Accrued expenses     48,627       53,761       44,249    
Total liabilities   $ 4,789,328     $ 6,108,600     $ 11,172,960    
Auction preferred shares at liquidation value plus cumulative unpaid dividends     22,508,135       21,875,000       26,004,573    
Net assets applicable to common shares   $ 40,263,134     $ 38,531,570     $ 45,516,373    
Sources of Net Assets  
Common Shares, $0.01 par value, unlimited number of shares authorized   $ 25,549     $ 25,127     $ 29,432    
Additional paid-in capital     36,204,414       35,610,746       41,716,097    
Accumulated net realized gain (loss) (computed on the basis of identified cost)     1,039,747       (503,743 )     61,926    
Accumulated undistributed net investment income     161,206       32,884       42,786    
Net unrealized appreciation (computed on the basis of identified cost)     2,832,218       3,366,556       3,666,132    
Net assets applicable to common shares   $ 40,263,134     $ 38,531,570     $ 45,516,373    
Auction Preferred Shares Issued and Outstanding
(Liquidation preference of $25,000 per share)
    900       875       1,040    
Common Shares Outstanding     2,554,928       2,512,727       2,943,172    
Net Asset Value Per Common Share  
Net assets applicable to common shares ÷ common shares issued and outstanding   $ 15.76     $ 15.33     $ 15.47    

 

See notes to financial statements
34



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FINANCIAL STATEMENTS CONT'D

Statements of Operations (As Restated — See Note 11)

For the Year Ended September 30, 2006

    Insured
Municipal Fund II
  Insured
California Fund II
  Insured
Florida Fund
 
Investment Income  
Interest   $ 13,439,133     $ 4,729,472     $ 3,159,772    
Total investment income   $ 13,439,133     $ 4,729,472     $ 3,159,772    
Expenses  
Investment adviser fee   $ 1,321,358     $ 501,015     $ 333,311    
Trustees' fees and expenses     11,735       6,904       1,726    
Legal and accounting services     43,622       41,707       38,644    
Printing and postage     19,178       9,588       7,837    
Interest expense and fees     1,396,990       275,511       179,031    
Custodian fee     143,383       54,729       41,368    
Transfer and dividend disbursing agent fees     121,342       52,281       37,390    
Preferred shares remarketing agent fee     218,752       84,373       56,250    
Miscellaneous     45,944       33,865       32,360    
Total expenses   $ 3,322,304     $ 1,059,973     $ 727,917    
Deduct —  
Reduction of custodian fee   $ 23,257     $ 12,523     $ 4,312    
Reduction of investment adviser fee     360,368       136,640       90,903    
Total expense reductions   $ 383,625     $ 149,163     $ 95,215    
Net expenses   $ 2,938,679     $ 910,810     $ 632,702    
Net investment income   $ 10,500,454     $ 3,818,662     $ 2,527,070    
Realized and Unrealized Gain (Loss)  
Net realized gain (loss) —  
Investment transactions (identified cost basis)   $ (22,558 )   $ (111,667 )   $ 198,356    
Financial futures contracts     4,379,013       1,384,983       854,528    
Net realized gain   $ 4,356,455     $ 1,273,316     $ 1,052,884    
Change in unrealized appreciation (depreciation) —  
Investments (identified cost basis)   $ 4,438,649     $ 1,678,359     $ 429,413    
Financial futures contracts     (2,788,744 )     (843,928 )     (577,247 )  
Net change in unrealized appreciation (depreciation)   $ 1,649,905     $ 834,431     $ (147,834 )  
Net realized and unrealized gain   $ 6,006,360     $ 2,107,747     $ 905,050    
Distributions to preferred shareholders  
From net investment income   $ (2,631,920 )   $ (937,884 )   $ (684,139 )  
Net increase in net assets from operations   $ 13,874,894     $ 4,988,525     $ 2,747,981    

 

See notes to financial statements
35



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FINANCIAL STATEMENTS CONT'D

Statements of Operations (As Restated — See Note 11)

For the Year Ended September 30, 2006

    Insured
Massachusetts Fund
  Insured
Michigan Fund
  Insured
New Jersey Fund
 
Investment Income  
Interest   $ 2,466,093     $ 1,996,324     $ 3,354,390    
Total investment income   $ 2,466,093     $ 1,996,324     $ 3,354,390    
Expenses  
Investment adviser fee   $ 230,928     $ 198,787     $ 338,123    
Affiliate interest expense     94,360                
Trustees' fees and expenses     1,726       154       1,710    
Legal and accounting services     33,925       30,501       34,039    
Printing and postage     7,738       6,900       11,715    
Interest expense and fees     314,015       202,858       335,296    
Custodian fee     33,110       33,815       46,272    
Transfer and dividend disbursing agent fees     28,319       26,033       38,431    
Preferred shares remarketing agent fee     38,748       33,104       56,250    
Miscellaneous     29,641       24,650       27,750    
Total expenses   $ 812,510     $ 556,802     $ 889,586    
Deduct —  
Reduction of custodian fee   $ 6,120     $ 4,633     $ 10,347    
Reduction of investment adviser fee     62,979       54,214       92,215    
Total expense reductions   $ 69,099     $ 58,847     $ 102,562    
Net expenses   $ 743,411     $ 497,955     $ 787,024    
Net investment income   $ 1,722,682     $ 1,498,369     $ 2,567,366    
Realized and Unrealized Gain (Loss)  
Net realized gain (loss) —  
Investment transactions (identified cost basis)   $ 156,458     $ 118,478     $ 210,722    
Financial futures contracts     732,010       511,945       1,094,595    
Net realized gain   $ 888,468     $ 630,423     $ 1,305,317    
Change in unrealized appreciation (depreciation) —  
Investments (identified cost basis)   $ 585,972     $ 303,340     $ 1,035,914    
Financial futures contracts     (407,508 )     (229,494 )     (616,975 )  
Net change in unrealized appreciation (depreciation)   $ 178,464     $ 73,846     $ 418,939    
Net realized and unrealized gain   $ 1,066,932     $ 704,269     $ 1,724,256    
Distributions to preferred shareholders  
From net investment income   $ (447,955 )   $ (381,488 )   $ (648,584 )  
Net increase in net assets from operations   $ 2,341,659     $ 1,821,150     $ 3,643,038    

 

See notes to financial statements
36



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FINANCIAL STATEMENTS CONT'D

Statements of Operations (As Restated — See Note 11)

For the Year Ended September 30, 2006

    Insured
New York Fund II
  Insured
Ohio Fund
  Insured
Pennsylvania Fund
 
Investment Income  
Interest   $ 3,127,516     $ 3,045,533     $ 3,778,031    
Total investment income   $ 3,127,516     $ 3,045,533     $ 3,778,031    
Expenses  
Investment adviser fee   $ 338,359     $ 326,163     $ 385,434    
Trustees' fees and expenses     1,642       1,725       1,827    
Legal and accounting services     37,875       33,907       34,583    
Printing and postage     7,249       9,125       12,075    
Interest expense and fees     163,452       154,688       345,276    
Custodian fee     39,389       40,456       55,382    
Transfer and dividend disbursing agent fees     28,681       37,235       42,931    
Preferred shares remarketing agent fee     56,250       54,688       64,999    
Miscellaneous     27,045       31,001       28,507    
Total expenses   $ 699,942     $ 688,988     $ 971,014    
Deduct —  
Reduction of custodian fee   $ 10,021     $ 10,974     $ 12,899    
Reduction of investment adviser fee     92,280       88,954       105,118    
Total expense reductions   $ 102,301     $ 99,928     $ 118,017    
Net expenses   $ 597,641     $ 589,060     $ 852,997    
Net investment income   $ 2,529,875     $ 2,456,473     $ 2,925,034    
Realized and Unrealized Gain (Loss)  
Net realized gain (loss) —  
Investment transactions (identified cost basis)   $ 694,203     $ 168,455     $ 364,262    
Financial futures contracts     1,126,461       1,268,821       1,766,510    
Swap contracts                 (223,978 )  
Net realized gain   $ 1,820,664     $ 1,437,276     $ 1,906,794    
Change in unrealized appreciation (depreciation) —  
Investments (identified cost basis)   $ 181,082     $ 622,466     $ 776,581    
Financial futures contracts     (630,916 )     (789,434 )     (544,764 )  
Swap contracts                 (498,658 )  
Net change in unrealized appreciation (depreciation)   $ (449,834 )   $ (166,968 )   $ (266,841 )  
Net realized and unrealized gain   $ 1,370,830     $ 1,270,308     $ 1,639,953    
Distributions to preferred shareholders  
From net investment income   $ (612,672 )   $ (660,891 )   $ (783,269 )  
From net realized gain     (37,328 )              
Net increase in net assets from operations   $ 3,250,705     $ 3,065,890     $ 3,781,718    

 

See notes to financial statements
37



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FINANCIAL STATEMENTS CONT'D

Statements of Changes in Net Assets

For the Year Ended September 30, 2006

Increase (Decrease) in Net Assets   Insured
Municipal Fund II
  Insured
California Fund II
  Insured
Florida Fund
 
    (As Restated —
See Note 11)
  (As Restated —
See Note 11)
     
From operations —  
Net investment income   $ 10,500,454     $ 3,818,662     $ 2,527,070    
Net realized gain from investment transactions and financial futures contracts     4,356,455       1,273,316       1,052,884    
Net change in unrealized appreciation (depreciation) from investments and
financial futures contracts
    1,649,905       834,431       (147,834 )  
Distributions to preferred shareholders —
From net investment income
    (2,631,920 )     (937,884 )     (684,139 )  
Net increase in net assets from operations   $ 13,874,894     $ 4,988,525     $ 2,747,981    
Distributions to common shareholders —  
From net investment income   $ (8,416,039 )   $ (2,983,698 )   $ (1,912,090 )  
Total distributions to common shareholders   $ (8,416,039 )   $ (2,983,698 )   $ (1,912,090 )  
Capital share transactions  
Reinvestment of distributions to common shareholders   $ 67,445     $ 7,738     $ 24,117    
Net increase in net assets from capital share transactions   $ 67,445     $ 7,738     $ 24,117    
Net increase in net assets   $ 5,526,300     $ 2,012,565     $ 860,008    
Net Assets Applicable to Common Shares  
At beginning of year   $ 151,936,585     $ 57,186,903     $ 38,268,812    
At end of year   $ 157,462,885     $ 59,199,468     $ 39,128,820    
Undistributed net investment income included
in net assets applicable to common shares
 
At end of year   $ 184,615     $ 94,976     $ 29,450    

 

See notes to financial statements
38



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FINANCIAL STATEMENTS CONT'D

Statements of Changes in Net Assets

For the Year Ended September 30, 2006

Increase (Decrease) in Net Assets   Insured
Massachusetts Fund
  Insured
Michigan Fund
  Insured
New Jersey Fund
 
    (As Restated —
See Note 11)
         
From operations —  
Net investment income   $ 1,722,682     $ 1,498,369     $ 2,567,366    
Net realized gain from investment transactions and financial futures contracts     888,468       630,423       1,305,317    
Net change in unrealized appreciation (depreciation) from investments and
financial futures contracts
    178,464       73,846       418,939    
Distributions to preferred shareholders —  
From net investment income     (447,955 )     (381,488 )     (648,584 )  
Net increase in net assets from operations   $ 2,341,659     $ 1,821,150     $ 3,643,038    
Distributions to common shareholders —  
From net investment income   $ (1,400,956 )   $ (1,166,029 )   $ (2,101,233 )  
Total distributions to common shareholders   $ (1,400,956 )   $ (1,166,029 )   $ (2,101,233 )  
Capital share transactions  
Reinvestment of distributions to common shareholders   $ 37,096     $ 9,334     $ 45,513    
Net increase in net assets from capital share transactions   $ 37,096     $ 9,334     $ 45,513    
Net increase in net assets   $ 977,799     $ 664,455     $ 1,587,318    
Net Assets Applicable to Common Shares  
At beginning of year   $ 26,441,449     $ 22,670,179     $ 39,032,337    
At end of year   $ 27,419,248     $ 23,334,634     $ 40,619,655    
Undistributed net investment income included
in net assets applicable to common shares
 
At end of year   $ 44,610     $ 33,700     $ 60,235    

 

See notes to financial statements
39



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FINANCIAL STATEMENTS CONT'D

Statements of Changes in Net Assets

For the Year Ended September 30, 2006

Increase (Decrease) in Net Assets   Insured
New York Fund II
  Insured
Ohio Fund
  Insured
Pennsylvania Fund
 
        (As Restated —
See Note 11)
  (As Restated —
See Note 11)
 
From operations —  
Net investment income   $ 2,529,875     $ 2,456,473     $ 2,925,034    
Net realized gain from investment transactions, financial futures contracts and swap contracts     1,820,664       1,437,276       1,906,794    
Net change in unrealized appreciation (depreciation) from investments, financial futures contracts and
swap contracts
    (449,834 )     (166,968 )     (266,841 )  
Distributions to preferred shareholders —  
From net investment income     (612,672 )     (660,891 )     (783,269 )  
From net realized gain     (37,328 )              
Net increase in net assets from operations   $ 3,250,705     $ 3,065,890     $ 3,781,718    
Distributions to common shareholders —  
From net investment income   $ (1,870,200 )   $ (1,789,062 )   $ (2,199,819 )  
From net realized gain     (217,935 )              
Total distributions to common shareholders   $ (2,088,135 )   $ (1,789,062 )   $ (2,199,819 )  
Capital share transactions  
Reinvestment of distributions to common shareholders   $     $     $ 14,661    
Net increase in net assets from capital share transactions   $     $     $ 14,661    
Net increase in net assets   $ 1,162,570     $ 1,276,828     $ 1,596,560    
Net Assets Applicable to Common Shares  
At beginning of year   $ 39,100,564     $ 37,254,742     $ 43,919,813    
At end of year   $ 40,263,134     $ 38,531,570     $ 45,516,373    
Undistributed net investment income included
in net assets applicable to common shares
 
At end of year   $ 161,206     $ 32,884     $ 42,786    

 

See notes to financial statements
40



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FINANCIAL STATEMENTS CONT'D

Statements of Changes in Net Assets

For the Year Ended September 30, 2005

Increase (Decrease) in Net Assets   Insured
Municipal Fund II
  Insured
California Fund II
  Insured
Florida Fund
 
        (As Restated —
See Note 11)
     
From operations —  
Net investment income   $ 10,846,557     $ 3,890,616     $ 2,614,424    
Net realized gain from investment transactions and financial futures contracts     (3,697,302 )     (1,112,326 )     (642,114 )  
Net change in unrealized appreciation (depreciation) from investments and
financial futures contracts
    7,278,731       2,484,245       1,670,118    
Distributions to preferred shareholders —
From net investment income
    (1,672,528 )     (558,126 )     (408,998 )  
From net realized gain     (2,835 )              
Net increase in net assets from operations   $ 12,752,623     $ 4,704,409     $ 3,233,430    
Distributions to common shareholders —  
From net investment income   $ (9,921,669 )   $ (3,559,348 )   $ (2,330,794 )  
From net realized gain     (28,757 )              
Total distributions to common shareholders   $ (9,950,426 )   $ (3,559,348 )   $ (2,330,794 )  
Capital share transactions  
Reinvestment of distributions to common shareholders   $ 77,370     $ 86,785     $ 154,716    
Net increase in net assets from capital share transactions   $ 77,370     $ 86,785     $ 154,716    
Net increase in net assets   $ 2,879,567     $ 1,231,846     $ 1,057,352    
Net Assets Applicable to Common Shares  
At beginning of year   $ 149,057,018     $ 55,955,057     $ 37,211,460    
At end of year   $ 151,936,585     $ 57,186,903     $ 38,268,812    
Undistributed net investment income included
in net assets applicable to common shares
 
At end of year   $ 773,207     $ 213,260     $ 107,874    

 

See notes to financial statements
41



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FINANCIAL STATEMENTS CONT'D

Statements of Changes in Net Assets

For the Year Ended September 30, 2005

Increase (Decrease) in Net Assets   Insured
Massachusetts Fund
  Insured
Michigan Fund
  Insured
New Jersey Fund
 
From operations —  
Net investment income   $ 1,802,336     $ 1,568,355     $ 2,659,492    
Net realized gain from investment transactions and financial futures contracts     (609,169 )     (627,156 )     (531,919 )  
Net change in unrealized appreciation (depreciation) from investments and
financial futures contracts
    1,117,600       978,843       1,390,392    
Distributions to preferred shareholders —  
From net investment income     (250,700 )     (247,412 )     (406,069 )  
Net increase in net assets from operations   $ 2,060,067     $ 1,672,630     $ 3,111,896    
Distributions to common shareholders —  
From net investment income   $ (1,657,895 )   $ (1,431,507 )   $ (2,456,689 )  
Total distributions to common shareholders   $ (1,657,895 )   $ (1,431,507 )   $ (2,456,689 )  
Capital share transactions  
Reinvestment of distributions to common shareholders   $ 57,153     $ 33,377     $ 50,800    
Net increase in net assets from capital share transactions   $ 57,153     $ 33,377     $ 50,800    
Net increase in net assets   $ 459,325     $ 274,500     $ 706,007    
Net Assets Applicable to Common Shares  
At beginning of year   $ 25,982,124     $ 22,395,679     $ 38,326,330    
At end of year   $ 26,441,449     $ 22,670,179     $ 39,032,337    
Undistributed net investment income included
in net assets applicable to common shares
 
At end of year   $ 178,054     $ 89,907     $ 242,532    

 

See notes to financial statements
42



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FINANCIAL STATEMENTS CONT'D

Statements of Changes in Net Assets

For the Year Ended September 30, 2005

Increase (Decrease) in Net Assets   Insured
New York Fund II
  Insured
Ohio Fund
  Insured
Pennsylvania Fund
 
From operations —  
Net investment income   $ 2,574,609     $ 2,526,350     $ 2,997,257    
Net realized gain from investment transactions and financial futures contracts     (60,395 )     (1,337,713 )     (617,701 )  
Net change in unrealized appreciation (depreciation) from investments and
financial futures contracts
    1,239,929       1,865,829       2,343,740    
Distributions to preferred shareholders —  
From net investment income     (378,349 )     (434,877 )     (507,628 )  
Net increase in net assets from operations   $ 3,375,794     $ 2,619,589     $ 4,215,668    
Distributions to common shareholders —  
From net investment income   $ (2,379,407 )   $ (2,163,391 )   $ (2,685,275 )  
Total distributions to common shareholders   $ (2,379,407 )   $ (2,163,391 )   $ (2,685,275 )  
Capital share transactions  
Reinvestment of distributions to common shareholders   $ 15,536     $ 52,662     $ 37,173    
Net increase in net assets from capital share transactions   $ 15,536     $ 52,662     $ 37,173    
Net increase in net assets   $ 1,011,923     $ 508,860     $ 1,567,566    
Net Assets Applicable to Common Shares  
At beginning of year   $ 38,088,641     $ 36,745,882     $ 42,352,247    
At end of year   $ 39,100,564     $ 37,254,742     $ 43,919,813    
Undistributed net investment income included
in net assets applicable to common shares
 
At end of year   $ 112,592     $ 48,190     $ 107,068    

 

See notes to financial statements
43



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FINANCIAL STATEMENTS CONT'D

Statements of Cash Flows

For the Year Ended September 30, 2006

Cash Flows from Operating Activities   Insured
Municipal Fund II
  Insured
Massachusetts Fund
  Insured
Michigan Fund
 
Net increase in net assets from operations   $ 13,874,894     $ 2,341,659     $ 1,821,150    
Distributions to preferred shareholders     2,631,920       447,955       381,488    
Net increase in net assets from operations excluding distributions to preferred shareholders from
net investment income
    16,506,814       2,789,614       2,202,638    
Adjustments to reconcile net increase in net assets resulting from operations to net cash
provided/(used) in operating activities:
 
Investments purchased     (74,079,576 )     (7,140,105 )     (2,919,794 )  
Investments sold     73,117,865       7,514,185       2,628,778    
Net amortization of premium/(discount)     (1,684,131 )     (105,024 )     (195,060 )  
Interest receivable     (1,934 )     10,392       15,076    
Receivable for daily variation margin on open financial futures contracts     225,000       37,500       20,625    
Receivable from transfer agent     20,372       2,124       2,931    
Prepaid expenses     30,268       4,299          
Payable for when-issued securities     (294,100 )     (522,643 )        
Payable to affiliate for investment advisory fees     1,123       111       70    
Payable to affiliate for trustees' fees                 (19 )  
Interest expense and fees payable     140,482       13,833       17,137    
Accrued expenses     2,431       3,498       8,618    
Net change in realized and unrealized (gain)/loss on investments     (4,416,091 )     (742,430 )     (421,818 )  
Net cash provided by operating activities   $ 9,568,523     $ 1,865,354     $ 1,359,182    
Cash Flows from Financing Activities  
Due to custodian           10,993       152,944    
Cash distributions paid for common shares net of reinvestments     (8,348,594 )     (1,363,860 )     (1,156,695 )  
Proceeds from secured borrowings     13,670,000       500,000          
Repayments of secured borrowings     (13,665,000 )     (835,000 )        
Distributions to preferred shareholders from net investment income     (2,624,563 )     (446,047 )     (378,654 )  
Net cash used in financing activities   $ (10,968,157 )   $ (2,133,914 )   $ (1,382,405 )  
Net increase/(decrease) in cash     (1,399,634 )     (268,560 )     (23,223 )  
Cash at beginning of period     1,647,236       268,560       23,223    
Cash at end of period   $ 247,602     $     $    
Supplemental Disclosure of Cash Flow Information:  
Noncash financing activities not included herein consists of reinvestment of dividends and
distributions of :
  $ 67,445     $ 37,096     $ 9,334    

 

See notes to financial statements
44



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FINANCIAL STATEMENTS CONT'D

Statements of Cash Flows

For the Year Ended September 30, 2006

Cash Flows from Operating Activities   Insured
New Jersey Fund
  Insured
Pennsylvania Fund
 
Net increase in net assets from operations   $ 3,643,038     $ 3,781,718    
Distributions to preferred shareholders     648,584       783,269    
Net increase in net assets from operations excluding distributions to preferred shareholders from net investment income     4,291,622       4,564,987    
Adjustments to reconcile net increase in net assets resulting from operations to net cash provided/(used) in operating activities:  
Investments purchased     (16,098,590 )     (20,104,646 )  
Investments sold     17,465,260       17,609,371    
Net amortization of premium/(discount)     (582,317 )     (344,292 )  
Interest receivable     38,748       (13,666 )  
Receivable for daily variation margin on open financial futures contracts     56,250       84,375    
Receivable from transfer agent     (251 )     3,937    
Payable for open swap contracts           498,658    
Payable for closed swap contracts           107,000    
Payable for when-issued securities     (1,051,380 )        
Payable to affiliate for investment advisory fees     153       255    
Payable to affiliate for trustees' fees     (16 )     67    
Interest expense and fees payable     30,249       48,170    
Accrued expenses     6,907       6,096    
Net change in realized and unrealized (gain)/loss on investments     (1,246,636 )     (1,140,843 )  
Net cash provided by operating activities   $ 2,909,999     $ 1,319,469    
Cash Flows from Financing Activities  
Due to custodian     (140,436 )     (326,071 )  
Cash distributions paid for common shares net of reinvestments     (2,055,720 )     (2,185,158 )  
Proceeds from secured borrowings           4,700,000    
Repayments of secured borrowings           (2,275,000 )  
Distributions to preferred shareholders from net investment income     (643,887 )     (780,426 )  
Net cash used in financing activities   $ (2,840,043 )   $ (866,655 )  
Net increase/(decrease) in cash     69,956       452,814    
Cash at beginning of period              
Cash at end of period   $ 69,956     $ 452,814    
Supplemental Disclosure of Cash Flow Information:  
Noncash financing activities not included herein consists of reinvestment of dividends and distributions of :   $ 45,513     $ 14,661    

 

See notes to financial statements
45




Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FINANCIAL STATEMENTS CONT'D

Financial Highlights (As Restated — See Note 11)

Selected data for a common share outstanding during the periods stated

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

 

See notes to financial statements
46



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FINANCIAL STATEMENTS CONT'D

Financial Highlights (As Restated — See Note 11)

Selected data for a common share outstanding during the periods stated

    Insured Municipal Fund II  
    Year Ended September 30,  
    2006(1)    2005(1)    2004(1)    2003(1)(2)   
Ratios/Supplemental Data   
Net assets applicable to common shares, end of year (000's omitted)   $ 157,463     $ 151,937     $ 149,057     $ 146,574    
Ratios (As a percentage of average net assets applicable to common shares):  
Expense excluding interest and fees(7)     1.02 %     1.03 %     1.00 %     0.86 %(8)  
Interest and fee expense(7)(11)     0.91 %     0.62 %     0.36 %     0.26 %(8)  
Total expenses(7)     1.93 %     1.65 %     1.36 %     1.12 %(8)  
Expenses after custodian fee reduction excluding interest and fees(7)     1.01 %     1.02 %     1.00 %     0.84 %(8)  
Net investment income(7)     6.87 %     7.11 %     7.92 %     7.14 %(8)  
Portfolio Turnover     26 %     10 %     28 %     32 %  

 

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

Ratios (As a percentage of average net assets applicable to common and preferred shares):  
Expense excluding interest and fees(7)     0.65 %     0.65 %     0.63 %     0.57 %(8)  
Interest and fee expense(7)(11)     0.58 %     0.40 %     0.23 %     0.17 %(8)  
Total expenses(7)     1.23 %     1.05 %     0.86 %     0.74 %(8)  
Expenses after custodian fee reduction excluding interest and fees(7)     0.64 %     0.65 %     0.62 %     0.56 %(8)  
Net investment income(7)     4.37 %     4.52 %     4.94 %     4.72 %(8)  
Senior Securities:  
Total preferred shares outstanding     3,500       3,500       3,500       3,500    
Asset coverage per preferred share(9)   $ 69,992     $ 68,411     $ 67,599     $ 66,893    
Involuntary liquidation preference per preferred share(10)   $ 25,000     $ 25,000     $ 25,000     $ 25,000    
Approximate market value per preferred share(10)   $ 25,000     $ 25,000     $ 25,000     $ 25,000    

 

(1)  Computed using average common shares outstanding.

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

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

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

(5)  Returns are historical and are calculated by determining the percentage change in net asset value or market value with all distributions reinvested. Total return is not computed on an annualized basis.

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

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

(8)  Annualized.

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

(10)  Plus accumulated and unpaid dividends.

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

See notes to financial statements
47



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FINANCIAL STATEMENTS CONT'D

Financial Highlights (As Restated — See Note 11)

Selected data for a common share outstanding during the periods stated

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

 

See notes to financial statements
48



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FINANCIAL STATEMENTS CONT'D

Financial Highlights (As Restated — See Note 11)

Selected data for a common share outstanding during the periods stated

    Insured California Fund II  
    Year Ended September 30,  
    2006(1)    2005(1)    2004(1)    2003(1)(2)   
Ratios/Supplemental Data   
Net assets applicable to common shares, end of year (000's omitted)   $ 59,199     $ 57,187     $ 55,955     $ 56,083    
Ratios (As a percentage of average net assets applicable to common shares):  
Expense excluding interest and fees(6)     1.13 %     1.10 %     1.09 %     0.98 %(7)  
Interest and fee expense(6)(10)     0.48 %     0.31 %     0.15 %     0.15 %(7)  
Total expenses(6)     1.61 %     1.41 %     1.24 %     1.13 %(7)  
Expenses after custodian fee reduction excluding interest and fees(6)     1.11 %     1.06 %     1.08 %     0.96 %(7)  
Net investment income(6)     6.66 %     6.81 %     7.27 %     6.75 %(7)  
Portfolio Turnover     13 %     13 %     11 %     22 %  

 

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

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

 

(1)  Computed using average common shares outstanding.

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

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

(4)  Returns are historical and are calculated by determining the percentage change in net asset value or market value with all distributions reinvested. Total return is not computed on an annualized basis.

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

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

(7)  Annualized.

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

(9)  Plus accumulated and unpaid dividends.

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

See notes to financial statements
49



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FINANCIAL STATEMENTS CONT'D

Financial Highlights (As Restated — See Note 11)

Selected data for a common share outstanding during the periods stated

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

 

See notes to financial statements
50



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FINANCIAL STATEMENTS CONT'D

Financial Highlights (As Restated — See Note 11)

Selected data for a common share outstanding during the periods stated

    Insured Florida Fund  
    Year Ended September 30,  
    2006(1)    2005(1)    2004(1)    2003(1)(2)   
Ratios/Supplemental Data   
Net assets applicable to common shares, end of year (000's omitted)   $ 39,129     $ 38,269     $ 37,211     $ 37,186    
Ratios (As a percentage of average net assets applicable to common shares):  
Expense excluding interest and fees(7)     1.20 %     1.17 %     1.14 %     1.04 %(8)  
Interest and fee expense(7)(11)     0.47 %     0.29 %     0.18 %     0.09 %(8)  
Total expenses(7)     1.67 %     1.46 %     1.32 %     1.13 %(8)  
Expenses after custodian fee reduction excluding interest and fees(7)     1.19 %     1.16 %     1.14 %     0.98 %(8)  
Net investment income(7)     6.63 %     6.84 %     7.30 %     6.45 %(8)  
Portfolio Turnover     16 %     13 %     17 %     10 %  

 

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

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

 

(1)  Computed using average common shares outstanding.

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

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

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

(5)  Returns are historical and are calculated by determining the percentage change in net asset value or market value with all distributions reinvested. Total return is not computed on an annualized basis.

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

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

(8)  Annualized.

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

(10)  Plus accumulated and unpaid dividends.

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

See notes to financial statements
51



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FINANCIAL STATEMENTS CONT'D

Financial Highlights (As Restated — See Note 11)

Selected data for a common share outstanding during the periods stated

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

 

See notes to financial statements
52



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FINANCIAL STATEMENTS CONT'D

Financial Highlights (As Restated — See Note 11)

Selected data for a common share outstanding during the periods stated

    Insured Massachusetts Fund  
    Year Ended September 30,  
    2006(1)    2005(1)    2004(1)    2003(1)(2)   
Ratios/Supplemental Data   
Net assets applicable to common shares, end of period (000's omitted)   $ 27,419     $ 26,441     $ 25,982     $ 25,586    
Ratios (As a percentage of average net assets applicable to common shares):  
Expense excluding interest and fees(6)     1.29 %     1.25 %     1.24 %     1.10 %(7)  
Interest and fee expense(6)(10)     1.54 %     1.26 %     0.79 %     0.26 %(7)  
Total expenses(6)     2.83 %     2.51 %     2.03 %     1.36 %(7)  
Expenses after custodian fee reduction excluding interest and fees(6)     1.26 %     1.24 %     1.24 %     1.06 %(7)  
Net investment income(6)     6.50 %     6.79 %     7.58 %     6.73 %(7)  
Portfolio Turnover     15 %     11 %     33 %     35 %  

 

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

Ratios (As a percentage of average net assets applicable to common and preferred shares):  
Expense excluding interest and fees(6)     0.81 %     0.79 %     0.77 %     0.73 %(7)  
Interest and fee expense(6)(10)     0.97 %     0.80 %     0.49 %     0.17 %(7)  
Total expenses(6)     1.78 %     1.59 %     1.26 %     0.90 %(7)  
Expenses after custodian fee reduction excluding interest and fees(6)     0.80 %     0.78 %     0.77 %     0.70 %(7)  
Net investment income(6)     4.10 %     4.29 %     4.72 %     4.42 %(7)  
Senior Securities:  
Total preferred shares outstanding     620       620       620       620    
Asset coverage per preferred share(8)   $ 69,229     $ 67,649     $ 66,907     $ 66,270    
Involuntary liquidation preference per preferred share(9)   $ 25,000     $ 25,000     $ 25,000     $ 25,000    
Approximate market value per preferred share(9)   $ 25,000     $ 25,000     $ 25,000     $ 25,000    

 

(1)  Computed using average common shares outstanding.

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

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

(4)  Returns are historical and are calculated by determining the percentage change in net asset value or market value with all distributions reinvested. Total return is not computed on an annualized basis.

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

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

(7)  Annualized.

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

(9)  Plus accumulated and unpaid dividends.

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

See notes to financial statements
53



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FINANCIAL STATEMENTS CONT'D

Financial Highlights (As Restated — See Note 11)

Selected data for a common share outstanding during the periods stated

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

 

See notes to financial statements
54



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FINANCIAL STATEMENTS CONT'D

Financial Highlights (As Restated — See Note 11)

Selected data for a common share outstanding during the periods stated

    Insured Michigan Fund  
    Year Ended September 30,  
    2006(1)    2005(1)    2004(1)    2003(1)(2)   
Ratios/Supplemental Data   
Net assets applicable to common shares, end of year (000's omitted)   $ 23,335     $ 22,670     $ 22,396     $ 21,893    
Ratios (As a percentage of average net assets applicable to common shares):  
Expense excluding interest and fees(6)     1.32 %     1.28 %     1.28 %     1.14 %(7)  
Interest and fee expense(6)(10)     0.90 %     0.60 %     0.33 %     1.27 %(7)  
Total expenses(6)     2.22 %     1.88 %     1.61 %     2.41 %(7)  
Expenses after custodian fee reduction excluding interest and fees(6)     1.30 %     1.27 %     1.27 %     1.09 %(7)  
Net investment income(6)     6.62 %     6.88 %     7.56 %     6.75 %(7)  
Portfolio Turnover     6 %     5 %     7 %     45 %  

 

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

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

 

(1)  Computed using average common shares outstanding.

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

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

(4)  Returns are historical and are calculated by determining the percentage change in net asset value or market value with all distributions reinvested. Total return is not computed on an annualized basis.

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

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

(7)  Annualized.

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

(9)  Plus accumulated and unpaid dividends.

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

See notes to financial statements
55



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FINANCIAL STATEMENTS CONT'D

Financial Highlights (As Restated — See Note 11)

Selected data for a common share outstanding during the periods stated

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

 

See notes to financial statements
56



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FINANCIAL STATEMENTS CONT'D

Financial Highlights (As Restated — See Note 11)

Selected data for a common share outstanding during the periods stated

    Insured New Jersey Fund  
    Year Ended September 30,  
    2006(1)    2005(1)    2004(1)    2003(1)(2)   
Ratios/Supplemental Data   
Net assets applicable to common shares, end of year (000's omitted)   $ 40,620     $ 39,032     $ 38,326     $ 37,687    
Ratios (As a percentage of average net assets applicable to common shares):  
Expense excluding interest and fees(6)     1.19 %     1.15 %     1.13 %     1.03 %(7)  
Interest and fee expense(6)(10)     0.86 %     0.59 %     0.31 %     0.27 %(7)  
Total expenses(6)     2.05 %     1.74 %     1.44 %     1.30 %(7)  
Expenses after custodian fee reduction excluding interest and fees(6)     1.16 %     1.14 %     1.13 %     0.99 %(7)  
Net investment income(6)     6.59 %     6.78 %     7.54 %     6.69 %(7)  
Portfolio Turnover     22 %     15 %     19 %     34 %  

 

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

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

 

(1)  Computed using average common shares outstanding.

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

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

(4)  Returns are historical and are calculated by determining the percentage change in net asset value or market value with all distributions reinvested. Total return is not computed on an annualized basis.

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

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

(7)  Annualized.

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

(9)  Plus accumulated and unpaid dividends.

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

See notes to financial statements
57



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FINANCIAL STATEMENTS CONT'D

Financial Highlights (As Restated — See Note 11)

Selected data for a common share outstanding during the periods stated

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

 

See notes to financial statements
58



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FINANCIAL STATEMENTS CONT'D

Financial Highlights (As Restated — See Note 11)

Selected data for a common share outstanding during the periods stated

    Insured New York Fund II  
    Year Ended September 30,  
    2006(1)    2005(1)    2004(1)    2003(1)(2)   
Ratios/Supplemental Data   
Net assets applicable to common shares, end of year (000's omitted)   $ 40,263     $ 39,101     $ 38,089     $ 37,984    
Ratios (As a percentage of average net assets applicable to common shares):  
Expense excluding interest and fees(7)     1.14 %     1.21 %     1.14 %     1.03 %(8)  
Interest and fee expense(7)(11)     0.42 %     0.28 %     0.16 %     0.14 %(8)  
Total expenses(7)     1.56 %     1.49 %     1.30 %     1.17 %(8)  
Expenses after custodian fee reduction excluding interest and fees(7)     1.11 %     1.19 %     1.13 %     0.98 %(8)  
Net investment income(7)     6.48 %     6.60 %     7.31 %     6.65 %(8)  
Portfolio Turnover     26 %     29 %     26 %     49 %  

 

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

Ratios (As a percentage of average net assets applicable to common and preferred shares):  
Expense excluding interest and fees(7)     0.72 %     0.77 %     0.71 %     0.68 %(8)  
Interest and fee expense(7)(11)     0.27 %     0.18 %     0.10 %     0.09 %(8)  
Total expenses(7)     0.99 %     0.95 %     0.81 %     0.77 %(8)  
Expenses after custodian fee reduction excluding interest and fees(7)     0.71 %     0.76 %     0.71 %     0.65 %(8)  
Net investment income(7)     4.11 %     4.18 %     4.58 %     4.40 %(8)  
Senior Securities:  
Total preferred shares outstanding     900       900       900       900    
Asset coverage per preferred share(9)   $ 69,746     $ 68,450     $ 67,323     $ 67,209    
Involuntary liquidation preference per preferred share(10)   $ 25,000     $ 25,000     $ 25,000     $ 25,000    
Approximate market value per preferred share(10)   $ 25,000     $ 25,000     $ 25,000     $ 25,000    

 

(1)  Computed using average common shares outstanding.

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

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

(4)  Returns are historical and are calculated by determining the percentage change in net asset value or market value with all distributions reinvested. Total return is not computed on an annualized basis.

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

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

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

(8)  Annualized.

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

(10)  Plus accumulated and unpaid dividends.

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

See notes to financial statements
59



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FINANCIAL STATEMENTS CONT'D

Financial Highlights (As Restated — See Note 11)

Selected data for a common share outstanding during the periods stated

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

 

See notes to financial statements
60



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FINANCIAL STATEMENTS CONT'D

Financial Highlights (As Restated — See Note 11)

Selected data for a common share outstanding during the periods stated

    Insured Ohio Fund  
    Year Ended September 30,  
    2006(1)    2005(1)    2004(1)    2003(1)(2)   
Ratios/Supplemental Data   
Net assets applicable to common shares, end of year (000's omitted)   $ 38,532     $ 37,255     $ 36,746     $ 36,610    
Ratios (As a percentage of average net assets applicable to common shares):  
Expense excluding interest and fees(6)     1.19 %     1.18 %     1.17 %     1.05 %(7)  
Interest and fee expense(6)(10)     0.41 %     0.25 %     0.13 %     0.09 %(7)  
Total expenses(6)     1.60 %     1.43 %     1.30 %     1.14 %(7)  
Expenses after custodian fee reduction excluding interest and fees(6)     1.16 %     1.16 %     1.16 %     0.99 %(7)  
Net investment income(6)     6.56 %     6.76 %     7.30 %     6.38 %(7)  
Portfolio Turnover     16 %     8 %     23 %     19 %  

 

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

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

 

(1)  Computed using average common shares outstanding.

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

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

(4)  Returns are historical and are calculated by determining the percentage change in net asset value or market value with all distributions reinvested. Total return is not computed on an annualized basis.

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

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

(7)  Annualized.

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

(9)  Plus accumulated and unpaid dividends.

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

See notes to financial statements
61



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FINANCIAL STATEMENTS CONT'D

Financial Highlights (As Restated — See Note 11)

Selected data for a common share outstanding during the periods stated

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

 

See notes to financial statements
62



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FINANCIAL STATEMENTS CONT'D

Financial Highlights (As Restated — See Note 11)

Selected data for a common share outstanding during the periods stated

    Insured Pennsylvania Fund  
    Year Ended September 30,  
    2006(1)    2005(1)    2004(1)    2003(1)(2)   
Ratios/Supplemental Data   
Net assets applicable to common shares, end of year (000's omitted)   $ 45,516     $ 43,920     $ 42,352     $ 42,822    
Ratios (As a percentage of average net assets applicable to common shares):  
Expense excluding interest and fees(6)     1.18 %     1.16 %     1.12 %     1.03 %(7)  
Interest and fee expense(6)(10)     0.78 %     0.41 %     0.25 %     0.14 %(7)  
Total expenses(6)     1.96 %     1.57 %     1.37 %     1.17 %(7)  
Expenses after custodian fee reduction excluding interest and fees(6)     1.15 %     1.15 %     1.11 %     0.97 %(7)  
Net investment income(6)     6.64 %     6.91 %     7.37 %     6.64 %(7)  
Portfolio Turnover     22 %     19 %     15 %     12 %  

 

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

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

 

(1)  Computed using average common shares outstanding.

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

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

(4)  Returns are historical and are calculated by determining the percentage change in net asset value or market value with all distributions reinvested. Total return is not computed on an annualized basis.

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

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

(7)  Annualized.

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

(9)  Plus accumulated and unpaid dividends.

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

See notes to financial statements
63




Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

NOTES TO FINANCIAL STATEMENTS

  1  Significant Accounting Policies

Eaton Vance Insured Municipal Bond Fund II (Insured Municipal Fund II), Eaton Vance Insured California Municipal Bond Fund II (Insured California Fund II), Eaton Vance Insured Florida Municipal Bond Fund (Insured Florida Fund), Eaton Vance Insured Massachusetts Municipal Bond Fund (Insured Massachusetts Fund), Eaton Vance Insured Michigan Municipal Bond Fund (Insured Michigan Fund), Eaton Vance Insured New Jersey Municipal Bond Fund (Insured New Jersey Fund), Eaton Vance Insured New York Municipal Bond Fund II (Insured New York Fund II), Eaton Vance Insured Ohio Municipal Bond Fund (Insured Ohio Fund), and Eaton Vance Insured Pennsylvania Municipal Bond Fund (Insured Pennsylvania Fund) (individually referred to as the Fund or collectively the Funds) are registered under the Investment Company Act of 1940, as amended, as non-diversified, closed-end management investment companies. Each of the Funds was organized under the laws of the Commonwealth of Massachusetts by an Agreement and Declaration of Trust dated October 3, 2002. Each Fund's investment objective is to achieve current income exempt from regular federal income tax, including alternative minimum tax, and, in state specific funds, taxes in its specified state. Each Fund seeks to achieve its objective by investing primarily in high grade municipal obligations that are insured as to the timely payment of principal and interest.

The following is a summary of significant accounting policies consistently followed by each Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America.

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

B  Floating Rate Notes Issues in Conjunction with Securities Held — The Funds sell a fixed-rate bond to a broker for cash. At the same time the Funds buy

a residual interest for cash in a Special Purpose Vehicle (which is generally organized as a trust) ("SPV") assets and cash flows set up by the broker, often referred to as an inverse floating rate obligation ("Inverse Floater"). The broker deposits a fixed-rate bond into the trust with the same CUSIP number as the fixed-rate bond sold to the broker by the Fund, and which may have been, but is not required to be, the fixed-rate bond purchased from the Fund, (the "Fixed-Rate Bond"). The SPV also issues floating-rate notes ("Floating-Rate Notes") which are sold to third-parties. The Funds may enter into shortfall and forbearance agreements with the broker by which a Fund agrees to reimburse the broker, in certain circumstances, for the difference between the liquidation value of the Fixed-Rate Bond held by the SPV and the liquidation value of the Floating-Rate Notes, as well as any shortfalls in interest cash flows. The Inverse Floater held by a Fund gives the Fund the right (1) to cause the holders of the Floating-Rate Notes to tender their notes at par, and (2) to have the broker transfer the Fixed-Rate Bond held by the SPV to the Fund, thereby collapsing the SPV. Pursuant to Financial Accounting Standards Board ("FASB") Statement No. 140, "Accounting for Transfers and Servicing of Financial Assets and Extinguishment of Liabilities" ("FAS 140"), the Funds account for the transaction described above as a secured borrowing by including the Fixed-Rate Bond in their Portfolio of Investments, and account for the Floating-Rate Notes as a liability under the caption "payable for floating rate notes issued" in the Funds' "Statement of Assets and Liabilities". The Floating Rate Notes have interest rates that generally reset weekly and their holders have the option to tender their notes to the broker for redemption at par at each reset date. At September 30, 2006, the Funds' investments were as follows:

Fund   Floating
Rate Notes
Outstanding
  Interest Rate or
Range of
Interest Rates
  Collateral for
Floating Rate
Notes Outstanding
 
Insured Municipal II   $ 39,570,000     3.74% – 3.78%   $ 63,214,399    
Insured California II     7,550,000     3.74% – 3.78%     12,037,571    
Insured Florida     5,055,000     3.74% – 3.78%     7,939,040    
Insured Massachusetts     8,765,000     3.74% – 3.77%     14,510,986    
Insured Michigan     5,780,000     3.74% – 3.78%     9,257,860    
Insured New Jersey     9,580,000     3.74% – 3.76%     15,302,880    
Insured New York II     4,665,000     3.74% – 3.76%     7,488,070    
Insured Ohio     4,770,000     3.73% – 3.78%     8,077,364    
Insured Pennsylvania     10,395,000     3.73% – 3.78%     17,106,586    

 

The Funds' investment policies and restrictions expressly permit investments in inverse floating rate securities. Inverse floating rate securities typically offer the potential for yields exceeding the yields available on fixed rate bonds with comparable credit quality and maturity. The Funds' investment policies do not allow the Funds to


64



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

NOTES TO FINANCIAL STATEMENTS CONT'D

borrow money for purposes of making investments. Management believes that the Funds' restrictions on borrowings do not apply to the secured borrowings deemed to have occurred for accounting purposes pursuant to FAS 140, which is distinct from legal borrowing of the Funds to which the restrictions apply. Inverse Floaters held by the Funds are Securities exempt from registration under Rules 144A of the Securities Act of 1933.

C  Income — Interest income is determined on the basis of interest accrued, adjusted for amortization of premium or accretion of discount.

D  Interest Expense — Interest expense relates to the Fund's liability with respect to floating rate notes held by third parties in conjunction with inverse floater securities transactions by the Funds. Interest expense is recorded as incurred.

E  Federal Taxes — Each Fund's policy is to comply with the provisions of the Internal Revenue Code applicable to regulated investment companies and to distribute to shareholders each year all of its taxable, if any, and tax-exempt income, including any net realized gain on investments. Therefore, no provision for federal income or excise tax is necessary. At September 30, 2006, the Funds, for federal income tax purposes, had capital loss carryovers which will reduce taxable income arising from future net realized gain on investments, if any, to the extent permitted by the Internal Revenue Code, and thus will reduce the amount of distributions to shareholders which would otherwise be necessary to relieve the Funds of any liability for federal income or excise tax. The amounts and expiration dates of the capital loss carryovers are as follows:

Fund   Amount   Expires  
Insured Municipal Fund II   $ 561,535     September 30, 2013  
Insured California Fund II     1,015,681     September 30, 2013  
Insured Florida Fund     725,954     September 30, 2013  
Insured Massachusetts Fund     551,616     September 30, 2013  
Insured Michigan Fund     652,425     September 30, 2013  
Insured New Jersey Fund     390,483     September 30, 2013  
Insured Ohio Fund     899,539     September 30, 2013  
Insured Pennsylvania Fund     53,657     September 30, 2013  

 

Additionally, at September 30, 2006, Insured California II Fund had net capital losses of $63,387, attributable to security transactions incurred after October 31, 2005. These are treated as arising on the first day of each Fund's taxable year ending September 30, 2007.

In addition, each Fund intends to satisfy conditions which will enable it to designate distributions from the interest income generated by its investments in municipal obligations, which are exempt from regular federal income taxes when received by each Fund, as exempt-interest dividends.

F  Organization and Offering Costs — Costs incurred by each Fund in connection with its organization have been expensed. Costs incurred by each Fund in connection with the offerings of the common shares and preferred shares were recorded as a reduction of capital paid in excess of par applicable to common shares.

G  Financial Futures Contracts — Upon the entering of a financial futures contract, a Fund is required to deposit (initial margin) either in cash or securities an amount equal to a certain percentage of the purchase price indicated in the financial futures contract. Subsequent payments are made or received by a Fund (margin maintenance) each day, dependent on the daily fluctuations in the value of the underlying security, and are recorded for book purposes as unrealized gains or losses by a Fund. A Fund's investment in financial futures contracts is designed for both hedging against anticipated future changes in interest rates and investment purposes. Should interest rates move unexpectedly, a Fund may not achieve the anticipated benefits of the financial futures contracts and may realize a loss.

H  Options on Financial Futures Contracts — Upon the purchase of a put option on a financial futures contract by a Fund, the premium paid is recorded as an investment, the value of which is marked-to-market daily. When a purchased option expires, a Fund will realize a loss in the amount of the cost of the option. When a Fund enters into a closing sale transaction, a Fund will realize a gain or loss depending on whether the sales proceeds from the closing sale transaction are greater or less than the cost of the option. When a Fund exercises a put option, settlement is made in cash. The risk associated with purchasing put options is limited to the premium originally paid.

I  When-Issued and Delayed Delivery Transactions — The Funds may engage in when-issued and delayed delivery transactions. The Funds record when-issued securities on trade date and maintain security positions such that sufficient liquid assets will be available to make payments for the securities purchased. Securities purchased on a when-issued or delayed delivery basis are marked-to-market daily and begin earning interest on settlement date.


65



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

NOTES TO FINANCIAL STATEMENTS CONT'D

J  Interest Rate Swaps — A Fund may enter into interest rate swap agreements to enhance return, to hedge against fluctuations in securities prices or interest rates or as substitution for the purchase or sale of securities. Pursuant to these agreements, the Fund makes semi-annual payments at a fixed interest rate. In exchange, a Fund receives payments based on the interest rate of a benchmark industry index. During the term of the outstanding swap agreement, changes in the underlying value of the swap are recorded as unrealized gains and losses. The value of the swap is determined by changes in the relationship between two rates of interest. The Fund is exposed to credit loss in the event of non-performance by the swap counterparty. However, the Fund does not anticipate non-performance by the counterparty. Risk may also arise from the unanticipated movements in value of interest rates.

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

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

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

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

O  Other — Investment transactions are accounted for on a trade date basis. Realized gains and losses are computed on the basis of specific identification of the securities sold.

  2  Auction Preferred Shares (APS)

Each Fund issued Auction Preferred Shares on January 15, 2003 in a public offering. The underwriting discounts and other offering costs were recorded as a reduction of capital of the common shares of each Fund. Dividends on the APS, which accrue daily, are cumulative at a rate which was established at the offering of each Fund's APS and generally have been reset every seven days thereafter by an auction, unless a special dividend period has been set. Initially, the Insured Municipal Fund II elected an Initial Dividend Period for Series B of 360 days. Effective January 6, 2006, the Series B shares of the Insured Municipal Fund II elected a weekly reset dividend period. Series A and Series B are identical in all respects except for the dates of reset for the dividend rates. Auction Preferred Shares issued and outstanding as of September 30, 2006 and dividend rate ranges for the year ended September 30, 2006 are as indicated below:

Fund   Preferred Shares
Issued and Outstanding
  Dividends Rate
Ranges
 
Insured Municipal Fund II Series A     1,750     2.20% – 3.62%  
Insured Municipal Fund II Series B     1,750     2.198% – 3.99%  
Insured California Fund II     1,350     1.586% – 3.90%  
Insured Florida Fund     900     1.90% – 3.75%  
Insured Massachusetts Fund     620     1.50% – 3.60%  
Insured Michigan Fund     540     1.81% – 3.80%  
Insured New Jersey Fund     900     2.00% – 3.65%  
Insured New York Fund II     900     2.13% – 4.40%  
Insured Ohio Fund     875     2.20% – 3.90%  
Insured Pennsylvania Fund     1,040     1.00% – 4.03%  

 

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


66



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

NOTES TO FINANCIAL STATEMENTS CONT'D

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

  3   Distributions to Shareholders

Each Fund intends to make monthly distributions of net investment income, after payments of any dividends on any outstanding APS. Distributions are recorded on the ex-dividend date. Distributions of realized capital gains, if any, are made at least annually. Distributions to preferred shareholders are recorded daily and are payable at the end of each dividend period. Each dividend payment period for the APS is generally seven days. The applicable dividend rates for Auction Preferred Shares on September 30, 2006 are listed below. For the year ended September 30, 2006, the amount of dividends each Fund paid to Auction Preferred shareholders and average APS dividend rates for such period were as follows:

Fund   APS
Dividend Rates
as of
September 30,
2006
  Dividends Paid
to Preferred
Shareholders from
net investment
income and net
realized gain for
the year ended
September 30,
2006
  Average
APS
Dividend
Rates for
the year ended
September 30,
2006
 
Insured Municipal Fund II
Series A
    3.55 %   $ 1,323,891       3.03 %  
Insured Municipal Fund II
Series B
    3.20 %     1,308,029       2.99 %  
Insured California Fund II     3.40 %     937,884       2.78 %  
Insured Florida Fund     3.55 %     684,139       3.04 %  
Insured Massachusetts Fund     3.50 %     447,955       2.89 %  
Insured Michigan Fund     3.40 %     381,488       2.83 %  
Insured New Jersey Fund     3.13 %     648,584       2.88 %  
Insured New York Fund II     3.30 %     650,000       2.89 %  
Insured Ohio Fund     3.25 %     660,891       3.02 %  
Insured Pennsylvania Fund     3.21 %     783,269       3.01 %  

 

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

The tax character of distributions paid for the years ended September 30, 2006 and September 30, 2005 was as follows:

Year Ended 9/30/06   Insured
Municipal II
  Insured
California II
  Insured
Florida
 
Distributions declared from:  
Tax-exempt income   $ 11,047,959     $ 3,921,582     $ 2,596,229    
Ordinary income                    
Period Ended 9/30/05              
Distributions declared from:  
Tax-exempt income   $ 11,594,327     $ 4,117,474     $ 2,739,792    
Ordinary income   $ 31,462                
Year Ended 9/30/06   Insured
Massachusetts
  Insured
Michigan
  Insured
New Jersey
 
Distributions declared from:  
Tax-exempt income   $ 1,848,911     $ 1,547,517     $ 2,749,009    
Ordinary income               $ 808    
Long-term capital gain                    
Period Ended 9/30/05              
Distributions declared from:  
Tax-exempt income   $ 1,908,595     $ 1,678,919     $ 2,861,219    
Ordinary income               $ 1,539    
Year Ended 9/30/06   Insured
New York II
  Insured
Ohio
  Insured
Pennsylvania
 
Distributions declared from:  
Tax-exempt income   $ 2,482,872     $ 2,449,953     $ 2,983,088    
Ordinary income                    
Long-term capital gain   $ 255,263                
Period Ended 9/30/05              
Distributions declared from:  
Tax-exempt income   $ 2,757,756     $ 2,598,268     $ 3,192,842    
Ordinary income               $ 61    

 

As of September 30, 2006, the components of distributable earnings (accumulated losses) on a tax basis were as follows:

    Insured
Municipal II
  Insured
California II
  Insured
Florida
 
Undistributed income   $ 193,184     $ 104,406     $ 40,391    
Capital loss carryforward   $ (561,535 )   $ (1,015,681 )   $ (725,954 )  
Unrealized gain   $ 15,773,335     $ 5,143,057     $ 3,062,032    
Other temporary differences   $ 1,207,725     $ 184,461     $ 211,544    

 


67



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

NOTES TO FINANCIAL STATEMENTS CONT'D

    Insured
Massachusetts
  Insured
Michigan
  Insured
New Jersey
 
Undistributed income   $ 47,582     $ 38,729     $ 69,864    
Capital loss carryforward   $ (551,616 )   $ (652,425 )   $ (390,483 )  
Unrealized gain   $ 2,918,725     $ 2,439,174     $ 4,354,010    
Other temporary differences   $ 145,585     $ 80,324     $ 218,921    
    Insured
New York II
  Insured
Ohio
  Insured
Pennsylvania
 
Undistributed income   $ 229,100     $ 32,884     $ 47,359    
Undistributed capital gains   $ 774,679                
Capital loss carryforward         $ (889,539 )   $ (53,657 )  
Unrealized gain   $ 2,810,206     $ 3,447,274     $ 3,814,315    
Other temporary differences   $ 219,186     $ 315,078     $ (37,173 )  

 

  4  Investment Adviser Fee and Other Transactions with Affiliates

The investment adviser fee, computed at an annual rate of 0.55% of each Fund's average weekly gross assets, was earned by Eaton Vance Management (EVM) as compensation for investment advisory services rendered to each Fund. Except for Trustees of each Fund who are not members of EVM's organization, officers and Trustees receive remuneration for their services to each Fund out of such investment adviser fee. For the year ended September 30, 2006, the fee was equivalent to 0.55% of each Fund's average weekly gross assets and amounted to $1,321,358, $501,015, $333,311, $230,928, $198,787, $338,123, $338,359, $326,163 and $385,434 for Insured Municipal Fund II, Insured California Fund II, Insured Florida Fund, Insured Massachusetts Fund, Insured Michigan Fund, Insured New Jersey Fund, Insured New York Fund II, Insured Ohio Fund and Insured Pennsylvania Fund, respectively. EVM also serves as the administrator of the Funds, but currently receives no compensation.

In addition, EVM has contractually agreed to reimburse each Fund for fees and other expenses in the amount of 0.15% of average weekly total assets of each Fund during the first five full years of each Fund's operations, 0.10% of average weekly total assets of each Fund in year six, and 0.05% in year seven. For the year ended September 30, 2006, EVM contractually waived $360,368, $136,640, $90,903, $62,979, $54,214, $92,215, $92,280, $88,954 and $105,118 for Insured Municipal Fund II, Insured California Fund II, Insured Florida Fund, Insured Massachusetts Fund, Insured Michigan Fund, Insured New Jersey Fund, Insured New York Fund II, Insured Ohio Fund and Insured Pennsylvania Fund, respectively.

Pursuant to FAS 140, a security sold by the Insured Massachusetts Fund that was later transferred to an SPV that then sold a residual interest to an affiliated fund was deemed to still be held by the Insured Massachusetts Fund. Interest paid by the SPV to the affiliated fund was deemed paid by the Insured Massachusetts Fund to the affiliated fund pursuant to FAS 140.

Certain officers and one Trustee of each Fund are officers of the above organization.

  5  Investments

Purchases and sales of investments, other than U.S. Government securities and short-term obligations, for the year ended September 30, 2006 were as follows:

Insured Municipal Fund II   As Restated  
Purchases   $ 74,062,038    
Sales     73,449,438    
Insured California Fund II  
Purchases   $ 13,174,523    
Sales     12,967,175    
Insured Florida Fund  
Purchases   $ 10,439,527    
Sales     11,272,907    
Insured Massachusetts Fund  
Purchases   $ 7,144,412    
Sales     7,514,185    
Insured Michigan Fund  
Purchases   $ 2,919,794    
Sales     2,628,778    
Insured New Jersey Fund  
Purchases   $ 16,098,590    
Sales     16,091,623    
Insured New York Fund II  
Purchases   $ 16,907,459    
Sales     18,839,787    
Insured Ohio Fund  
Purchases   $ 11,885,710    
Sales     10,142,888    

 


68



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

NOTES TO FINANCIAL STATEMENTS CONT'D

Insured Pennsylvania Fund  
Purchases   $ 20,094,920    
Sales     17,609,371    

 

  6  Federal Income Tax Basis of Unrealized Appreciation (Depreciation)

The cost and unrealized appreciation (depreciation) in value of the investments owned by each Fund at September 30, 2006, as computed for Federal income tax purposes, were as follows:

Insured Municipal Fund II  
Aggregate Cost   $ 228,160,627    
Gross unrealized appreciation   $ 17,158,676    
Gross unrealized depreciation     (169,047 )  
Net unrealized appreciation   $ 16,989,629    
Insured California Fund II  
Aggregate Cost   $ 87,068,841    
Gross unrealized appreciation   $ 5,462,672    
Gross unrealized depreciation     (62,337 )  
Net unrealized appreciation   $ 5,400,335    
Insured Florida Fund  
Aggregate Cost   $ 56,631,482    
Gross unrealized appreciation   $ 3,316,708    
Gross unrealized depreciation     (32,191 )  
Net unrealized appreciation   $ 3,284,517    
Insured Massachusetts Fund  
Aggregate Cost   $ 39,408,906    
Gross unrealized appreciation   $ 3,094,417    
Gross unrealized depreciation     (27,134 )  
Net unrealized appreciation   $ 3,067,283    

 

Insured Michigan Fund  
Aggregate Cost   $ 34,012,432    
Gross unrealized appreciation   $ 2,552,105    
Gross unrealized depreciation     (27,578 )  
Net unrealized appreciation   $ 2,524,527    
Insured New Jersey Fund  
Aggregate Cost   $ 57,911,934    
Gross unrealized appreciation   $ 4,583,584    
Gross unrealized depreciation     (1,024 )  
Net unrealized appreciation   $ 4,582,560    
Insured New York Fund II  
Aggregate Cost   $ 58,887,615    
Gross unrealized appreciation   $ 3,042,736    
Gross unrealized depreciation     (5,209 )  
Net unrealized appreciation   $ 3,037,527    
Insured Ohio Fund  
Aggregate Cost   $ 55,965,631    
Gross unrealized appreciation   $ 3,856,023    
Gross unrealized depreciation     (93,671 )  
Net unrealized appreciation   $ 3,762,352    
Insured Pennsylvania Fund  
Aggregate Cost   $ 66,636,341    
Gross unrealized appreciation   $ 4,301,252    
Gross unrealized depreciation     (20,879 )  
Net unrealized appreciation   $ 4,280,373    

 


69



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

NOTES TO FINANCIAL STATEMENTS CONT'D

  7  Shares of Beneficial Interest

Each Declaration of Trust permits the Trustees to issue an unlimited number of full and fractional $0.01 par value common shares. Transactions in common shares were as follows:

    Insured Municipal Fund II  
    Year Ended September 30,  
    2006   2005  
Shares issued pursuant to the
Fund's dividend reinvestment plan
    4,301       4,972    
Net increase     4,301       4,972    
    Insured California Fund II  
    Year Ended September 30,  
    2006   2005  
Shares issued pursuant to the
Fund's dividend reinvestment plan
    522       5,859    
Net increase     522       5,859    
    Insured Florida Fund  
    Year Ended September 30,  
    2006   2005  
Shares issued pursuant to the
Fund's dividend reinvestment plan
    1,642       10,376    
Net increase     1,642       10,376    
    Insured Massachusetts Fund  
    Year Ended September 30,  
    2006   2005  
Shares issued pursuant to the
Fund's dividend reinvestment plan
    2,419       3,549    
Net increase     2,419       3,549    
    Insured Michigan Fund  
    Year Ended September 30,  
    2006   2005  
Shares issued pursuant to the
Fund's dividend reinvestment plan
    620       2,181    
Net increase     620       2,181    

 

    Insured New Jersey Fund  
    Year Ended September 30,  
    2006   2005  
Shares issued pursuant to the
Fund's dividend reinvestment plan
    2,951       3,289    
Net increase     2,951       3,289    
    Insured New York Fund II  
    Year Ended September 30,  
    2006   2005  
Shares issued pursuant to the
Fund's dividend reinvestment plan
          1,022    
Net increase           1,022    
    Insured Ohio Fund  
    Year Ended September 30,  
    2006   2005  
Shares issued pursuant to the
Fund's dividend reinvestment plan
          3,501    
Net increase           3,501    
    Insured Pennsylvania Fund  
    Year Ended September 30,  
    2006   2005  
Shares issued pursuant to the
Fund's dividend reinvestment plan
    975       2,445    
Net increase     975       2,445    

 

  8  Financial Instruments    

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


70



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

NOTES TO FINANCIAL STATEMENTS CONT'D

A summary of obligations under these financial instruments at September 30, 2006 is as follows:

Futures Contracts

Fund   Expiration
Date
  Contracts   Position   Aggregate
Cost
  Value   Net Unrealized
Appreciation/
(Depreciation)
 
Insured
Municipal II
  12/06   525
U.S. Treasury Bond
  Short   $(57,796,987)   $ (59,013,281 )   $(1,216,294)  
Insured
California II
  12/06   150
U.S. Treasury Bond
  Short   $(16,603,659)   $ (16,860,937 )   $(257,278)  
Insured
Florida
  12/06   92
U.S. Treasury Bond
  Short   $(10,118,890)   $ (10,341,375 )   $(222,485)  
Insured
Massachusetts
  12/06   65
U.S. Treasury Bond
  Short   $(7,157,848)   $ (7,306,406 )   $(148,558)  
Insured
Michigan
  12/06   39
U.S. Treasury Bond
  Short   $(4,298,491)   $ (4,383,844 )   $(85,353)  
Insured
New Jersey
  12/06   100
U.S. Treasury Bond
  Short   $(11,012,075)   $ (11,240,625 )   $(228,550)  
Insured
New York II
  12/06   94
U.S. Treasury Bond
  Short   $(10,338,866)   $ (10,566,187 )   $(227,321)  
Insured
Ohio
  12/06   136
U.S. Treasury Bond
  Short   $(14,972,172)   $ (15,287,250 )   $(315,078)  
Insured
Pennsylvania
  12/06   50
U.S. Treasury Bond
  Short   $(5,652,912)   $ (5,620,312 )   $32,600  

 

At, September 30, 2006, the Insured Pennsylvania Fund had entered into an interest rate swap agreement with JP Morgan Chase Bank, N.A. whereby the Fund makes semi-annually payments at a fixed rate equal to 5.77% on the notional amount of $7,000,000. In exchange, the Fund receives quarterly payments at a rate equal to the three month USD-LIBOR on the same notional amount. The effective date of the interest rate swap is February 26, 2007. The value of the contract, which terminates February 26, 2037, is recorded as a payable for open swap contracts of $498,658, as of September 30, 2006.

At September 30, 2006, the Funds had sufficient cash and/or securities to cover margin requirements on these contracts.

  9  Overdraft Advances

Pursuant to the custodian agreement between the Funds and IBT, IBT may in its discretion advance funds to the Funds to make properly authorized payments. When such payments result in an overdraft by the Funds, the Funds are obligated to repay IBT at the current rate of interest charged by IBT for secured loans (currently, a rate above the Federal Funds rate). This obligation is payable on demand to IBT. IBT has a lien on a Fund's assets to the extent of any overdraft. At September 30, 2006, Insured California Fund II, Insured Florida Fund, Insured Massachusetts Fund, Insured Michigan Fund and Insured Ohio Fund had payments due to IBT pursuant to the foregoing arrangement of $308,647, $368,473, $10,993, $152,944 and $1,209,049, respectively.

  10  Recently Issued Accounting Pronouncements

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

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


71



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

NOTES TO FINANCIAL STATEMENTS CONT'D

  11  Restatement Information

Subsequent to the issuance of its September 30, 2006 financial statements, the Funds determined that the criteria for sale accounting in Statement of Financial Accounting Standards No. 140 had not been met for certain transfers of municipal bonds during the fiscal years ended September 30, 2006, 2005, 2004 and for the period November 29, 2002 (commencement of operations) to September 30, 2003 and that the transfers should have been accounted for as secured borrowings rather than as sales. Accordingly, the Funds have restated, where necessary, the statements of assets and liabilities as of September 30, 2006 and the related statements of operations for the year then ended and statements of changes in net assets for the years ended September 30, 2006 and 2005, as required. The financial highlights for each of the three years in the period then ended and the period from the start of business, November 29, 2002 to September 30, 2003 have been restated, as required, to give effect to recording the transfers of the municipal bonds as secured borrowings, including recording interest on the bonds as interest income and interest on the secured borrowings as interest expense in the Statements of Operations.

The summary of effects on the restatement is as follows:

    Insured
Municipal II
  Insured
California II
  Insured
Florida
 
    Previously
Reported
  Restated   Previously
Reported
  Restated   Previously
Reported
  Restated  
Statements of Assets and Liabilities
of September 30, 2006
 
Identified cost   $ 228,328,350     $ 267,529,131     $ 87,131,179     $ 94,607,941     $ 56,663,674     $ 61,688,482    
Unrealized appreciation     16,821,906       17,191,125       5,337,997       5,411,235       3,252,325       3,282,517    
Investments, at value     245,150,256       284,720,256       92,469,176       100,019,176       59,915,999       64,970,999    
Interest receivable     3,010,837       3,513,828       888,328       976,262       985,347       1,041,418    
Total Assets     248,740,268       288,813,259       93,357,504       100,995,438       62,081,754       67,192,825    
Payable for floating rate notes issued           39,570,000             7,550,000             5,055,000    
Interest expense and fees payable           502,991             87,934             56,071    
Total Liabilities     3,768,814       43,841,805       398,606       8,036,540       441,993       5,553,064    
Sources of Net Assets  
Accumulated net realized gain (loss)
(computed on the basis of identified cost)
    822,482       453,263       (759,452 )     (832,690 )     (471,277 )     (501,469 )  
Net unrealized appreciation
(computed on the basis of identified cost)
    15,605,612       15,974,831       5,080,719       5,153,957       3,029,840       3,060,032    
Statements of Operations for the
year ended September 30, 2006
 
Interest     12,042,143       13,439,133       4,453,961       4,729,472       2,980,741       3,159,772    
Total Investment income     12,042,143       13,439,133       4,453,961       4,729,472       2,980,741       3,159,772    
Interest expense and fees           1,396,990             275,511             179,031    
Total expenses     1,925,314       3,322,304       784,462       1,059,973       548,886       727,917    
Net expenses     1,541,689       2,938,679       635,299       910,810       453,671       632,702    
Realized and Unrealized Gain (Loss)  
Investment transactions (identified cost basis)     (16,003 )     (22,258 )     (117,587 )     (111,667 )              
Net realized gain     4,363,010       4,356,455       1,267,396       1,273,316                
Change in unrealized appreciation (depreciation)  
Investments (identified cost basis)     4,432,094       4,438,649       1,684,279       1,678,359                
Net change in unrealized appreciation (depreciation)     1,643,350       1,649,905       840,351       834,431                

 


72



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

NOTES TO FINANCIAL STATEMENTS CONT'D

    Insured
Municipal II
  Insured
California II
  Insured
Florida
 
    Previously
Reported
  Restated   Previously
Reported
  Restated   Previously
Reported
  Restated  
Statements of Changes in Net Assets
for the year ended September 30, 2006
 
Net realized gain from investment transactions,
financial future contracts
  $ 4,363,010     $ 4,356,455     $ 1,267,396     $ 1,273,316                    
Net change in unrealized appreciation (depreciation)
from investments, and financial futures contracts
    1,643,350       1,649,905       840,351       834,431                    
Statements of Changes in Net Assets
for the year ended September 30, 2005
 
Net realized gain from investment transactions,
financial future contracts
                    (1,103,866 )     (1,112,326 )                  
Net change in unrealized appreciation (depreciation)
from investments, and financial futures contracts
                    2,475,785       2,484,245                    
    Insured
Massachusetts
  Insured
Michigan
  Insured
New Jersey
 
    Previously
Reported
  Restated   Previously
Reported
  Restated   Previously
Reported
  Restated  
Statements of Assets and Liabilities
of September 30, 2006
 
Identified cost   $ 39,416,040     $ 49,784,629     $ 34,040,011     $ 39,794,782     $ 57,912,957     $ 67,439,526    
Unrealized appreciation     3,060,149       3,042,760       2,496,948       2,522,177       4,581,537       4,634,968    
Investments, at value     42,476,189       52,827,389       36,536,959       42,316,959       62,494,494       72,074,494    
Interest receivable     516,570       600,144       510,398       565,662       626,281       711,885    
Total Assets     42,995,730       53,430,504       37,047,357       42,882,621       63,195,871       72,861,475    
Payable to affiliate for inverse floaters           1,586,200                                    
Payable for floating rate notes issued           8,765,000             5,780,000             9,580,000    
Interest expense and fees payable           83,574             55,264             85,604    
Total Liabilities     73,510       10,508,284       207,694       6,042,958       66,587       9,732,191    
Sources of Net Assets  
Accumulated net realized gain (loss)
(computed on the basis of identified cost)
    (395,925 )     (378,536 )     (539,493 )     (564,722 )     (160,910 )     (214,341 )  
Net unrealized appreciation (depreciation)
(computed on the basis of identified cost)
    2,911,591       2,894,202       2,411,595       2,436,824       4,352,987       4,406,418    
Statements of Operations for
year ended September 30, 2006
 
Interest     2,057,718       2,466,093       1,793,466       1,996,324       3,019,094       3,354,390    
Total Investment income     2,057,718       2,466,093       1,793,466       1,996,324       3,019,094       3,354,390    
Affiliate interest expense           94,360                                    
Interest expense and fees           314,015             202,858             335,296    
Total expenses     404,135       812,510       353,944       556,802       554,290       889,586    
Net expenses     335,036       743,411       295,097       497,955       451,728       787,024    
Realized and Unrealized Gain (Loss)  
Investment transactions (identified cost basis)     124,091       156,458                            
Net realized gain     856,101       888,468                            
Change in unrealized appreciation (depreciation)  
Investments (identified cost basis)     618,339       585,972                            
Net change in unrealized appreciation (depreciation)     210,831       178,464                            

 


73



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

NOTES TO FINANCIAL STATEMENTS CONT'D

    Insured
Massachusetts
  Insured
Michigan
  Insured
New Jersey
 
    Previously
Reported
  Restated   Previously
Reported
  Restated   Previously
Reported
  Restated  
Statements of Changes in Net Assets
for the year ended September 30, 2006
 
Net realized gain from investment transactions,
and financial future contracts
  $ 856,101     $ 888,468                            
Net change in unrealized appreciation (depreciation)
from investments, and financial futures contracts
    210,831       178,464                            
    Insured
New York II
  Insured
Ohio
  Insured
Pennsylvania
 
    Previously
Reported
  Restated   Previously
Reported
  Restated   Previously
Reported
  Restated  
Statements of Assets and Liabilities
of September 30, 2006
 
Identified cost   $ 58,887,609     $ 63,530,603     $ 56,048,774     $ 60,816,349     $ 66,657,220     $ 77,179,524    
Unrealized appreciation     3,037,533       3,059,539       3,679,209       3,681,634       4,259,494       4,132,190    
Investments, at value     61,925,142       66,590,142       59,727,983       64,497,983       70,916,714       81,311,714    
Interest receivable     751,451       806,490       790,496       846,479       824,815       929,378    
Total Assets     62,840,558       67,560,597       61,689,187       66,515,170       72,194,343       82,693,906    
Payable for floating rate notes issued           4,665,000             4,770,000             10,395,000    
Interest expense and fees payable           55,039             55,983             104,563    
Total Liabilities     69,289       4,789,328       1,282,617       6,108,600       673,397       11,172,960    
Sources of Net Assets  
Accumulated net realized gain (loss)
(computed on the basis of identified cost)
    1,061,753       1,039,747       (501,318 )     (503,743 )     (65,378 )     61,926    
Net unrealized appreciation (depreciation)
(computed on the basis of identified cost)
    2,810,212       2,832,218       3,364,131       3,366,556       3,793,436       3,666,132    
Statements of Operations for
year ended September 30, 2006
 
Interest     2,964,064       3,127,516       2,890,845       3,045,533       3,432,755       3,778,031    
Total Investment income     2,964,064       3,127,516       2,890,845       3,045,533       3,432,755       3,778,031    
Interest expense and fees           163,452             154,688             345,276    
Total expenses     536,490       699,942       534,300       688,988       625,738       971,014    
Net expenses     434,189       597,641       434,372       589,060       507,721       852,997    
Realized and Unrealized Gain (Loss)  
Investment transactions (identified cost basis)                 168,875       168,455       159,372       364,262    
Net realized gain                 1,437,696       1,437,276       1,701,904       1,906,794    
Change in unrealized appreciation (depreciation)  
Investments (identified cost basis)                 622,046       622,466       981,471       776,581    
Net change in unrealized appreciation (depreciation)                 (167,388 )     (166,968 )     (61,951 )     (266,841 )  

 


74



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

NOTES TO FINANCIAL STATEMENTS CONT'D

    Insured
New York II
  Insured
Ohio
  Insured
Pennsylvania
 
    Previously
Reported
  Restated   Previously
Reported
  Restated   Previously
Reported
  Restated  
Statements of Changes in Net Assets
for the year ended September 30, 2006
 
Net realized gain from investment transactions
financial future contracts and swap contracts
      $ 1,437,696     $ 1,437,276     $ 1,701,904     $ 1,906,794    
Net change in unrealized appreciation (depreciation) from
investments financial futures contracts and swap contracts
        (167,388 )     (166,968 )     (61,951 )     (266,841 )  

 

Insured Municipal II Fund
Financial Highlights
for the years ending September 30, 2006
2005, 2004 and 2003

    2006   2005   2004  
    Previously
Reported
  Restated   Previously
Reported
  Restated   Previously
Reported
  Restated  
Expense Ratios:  
Common Shares:  
Total expenses     1.02 %     1.93 %     1.03 %     1.65 %     1.00 %     1.36 %  
Portfolio Turnover     43 %     26 %     11 %     10 %     34 %     28 %  

 

    2003  
    Previously
Reported
  Restated  
Expense Ratios:  
Common Shares:  
Total expenses     0.86 %     1.12 %  
Portfolio Turnover of the Fund     79 %     32 %  

 

    2006   2005   2004  
    Previously
Reported
  Restated   Previously
Reported
  Restated   Previously
Reported
  Restated  
Expense Ratios:  
Applicable to Preferred Shares:  
Total expenses     0.65 %     1.23 %     0.65 %     1.05 %     0.63 %     0.86 %  

 

    2003  
    Previously
Reported
  Restated  
Expense Ratios:  
Applicable to Preferred Shares:  
Total expenses     0.57 %     0.74 %  

 


75



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

NOTES TO FINANCIAL STATEMENTS CONT'D

Insured California II Fund
Financial Highlights
for the years ending September 30, 2006
2005, 2004 and 2003

    2006   2005   2004  
    Previously
Reported
  Restated   Previously
Reported
  Restated   Previously
Reported
  Restated  
Expense Ratios:  
Common Shares:  
Total expenses     1.13 %     1.61 %     1.10 %     1.41 %     1.09 %     1.24 %  
Portfolio Turnover     18 %     13 %     15 %     13 %     13 %     11 %  

 

    2003  
    Previously
Reported
  Restated  
Expense Ratios:  
Common Shares:  
Total expenses     0.98 %     1.13 %  
Portfolio Turnover     36 %     22 %  

 

    2006   2005   2004  
    Previously
Reported
  Restated   Previously
Reported
  Restated   Previously
Reported
  Restated  
Expense Ratios:  
Applicable to Preferred Shares:  
Total expenses     0.71 %     1.01 %     0.69 %     0.89 %     0.68 %     0.77 %  

 

    2003  
    Previously
Reported
  Restated  
Expense Ratios:  
Applicable to Preferred Shares:  
Total expenses     0.64 %     0.74 %  

 

Insured Florida Fund
Financial Highlights
for the years ending September 30, 2006
2005, 2004 and 2003

    2006   2005   2004  
    Previously
Reported
  Restated   Previously
Reported
  Restated   Previously
Reported
  Restated  
Expense Ratios:  
Common Shares:  
Total expenses     1.20 %     1.67 %     1.17 %     1.46 %     1.14 %     1.32 %  
Portfolio Turnover     17 %     16 %     14 %     13 %     19 %     17 %  

 


76



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

NOTES TO FINANCIAL STATEMENTS CONT'D

    2003  
    Previously
Reported
  Restated  
Expense Ratios:  
Common Shares:  
Total expenses     1.04 %     1.13 %  
Portfolio Turnover     29 %     10 %  

 

    2006   2005   2004  
    Previously
Reported
  Restated   Previously
Reported
  Restated   Previously
Reported
  Restated  
Expense Ratios:  
Applicable to Preferred Shares:  
Total expenses     0.76 %     1.05 %     0.74 %     0.92 %     0.71 %     0.82 %  

 

    2003  
    Previously
Reported
  Restated  
Expense Ratios:  
Applicable to Preferred Shares:  
Total expenses     0.69 %     0.75 %  

 

Insured Massachusetts Fund
Financial Highlights
for the years ending September 30, 2006
2005, 2004 and 2003

    2006   2005   2004  
    Previously
Reported
  Restated   Previously
Reported
  Restated   Previously
Reported
  Restated  
Expense Ratios:  
Common Shares:  
Total expenses     1.29 %     2.83 %     1.25 %     2.51 %     1.24 %     2.03 %  
Portfolio Turnover     21 %     15 %     12 %     11 %     39 %     33 %  

 

    2003  
    Previously
Reported
  Restated  
Expense Ratios:  
Common Shares:  
Total expenses     1.10 %     1.36 %  
Portfolio Turnover     81 %     35 %  

 


77



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

NOTES TO FINANCIAL STATEMENTS CONT'D

    2006   2005   2004  
    Previously
Reported
  Restated   Previously
Reported
  Restated   Previously
Reported
  Restated  
Expense Ratios:  
Applicable to Preferred Shares:  
Total expenses     0.81 %     1.78 %     0.79 %     1.59 %     0.77 %     1.26 %  

 

    2003  
    Previously
Reported
  Restated  
Expense Ratios:  
Applicable to Preferred Shares:  
Total expenses     0.73 %     0.90 %  

 

Insured Michigan Fund
Financial Highlights
for the years ending September 30, 2006
2005, 2004 and 2003

    2006   2005   2004  
    Previously
Reported
  Restated   Previously
Reported
  Restated   Previously
Reported
  Restated  
Expense Ratios:  
Common Shares:  
Total expenses     1.32 %     2.22 %     1.28 %     1.88 %     1.28 %     1.61 %  
Portfolio Turnover     7 %     6 %     6 %     5 %     8 %     7 %  

 

    2003  
    Previously
Reported
  Restated  
Expense Ratios:  
Common Shares:  
Total expenses     1.14 %     2.41 %  
Portfolio Turnover of the Portfolio     79 %     45 %  

 

    2006   2005   2004  
    Previously
Reported
  Restated   Previously
Reported
  Restated   Previously
Reported
  Restated  
Expense Ratios:  
Applicable to Preferred Shares:  
Total expenses     0.83 %     1.39 %     0.81 %     1.19 %     0.79 %     1.00 %  

 


78



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

NOTES TO FINANCIAL STATEMENTS CONT'D

    2003  
    Previously
Reported
  Restated  
Expense Ratios:  
Applicable to Preferred Shares:  
Total expenses     0.75 %     1.58 %  

 

Insured New Jersey Fund
Financial Highlights
for the years ending September 30, 2006
2005, 2004 and 2003

    2006   2005   2004  
    Previously
Reported
  Restated   Previously
Reported
  Restated   Previously
Reported
  Restated  
Expense Ratios:  
Common Shares:  
Total expenses     1.19 %     2.05 %     1.15 %     1.74 %     1.13 %     1.44 %  
Portfolio Turnover     26 %     22 %     18 %     15 %     22 %     19 %  

 

    2003  
    Previously
Reported
  Restated  
Expense Ratios:  
Common Shares:  
Total expenses     1.03 %     1.30 %  
Portfolio Turnover     68 %     34 %  

 

    2006   2005   2004  
    Previously
Reported
  Restated   Previously
Reported
  Restated   Previously
Reported
  Restated  
Expense Ratios:  
Applicable to Preferred Shares:  
Total expenses     0.75 %     1.30 %     0.73 %     1.11 %     0.71 %     0.91 %  

 

    2003  
    Previously
Reported
  Restated  
Expense Ratios:  
Applicable to Preferred Shares:  
Total expenses     0.69 %     0.87 %  

 


79



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

NOTES TO FINANCIAL STATEMENTS CONT'D

Insured New York II Fund
Financial Highlights
for the years ending September 30, 2006
2005, 2004 and 2003

    2006   2005   2004  
    Previously
Reported
  Restated   Previously
Reported
  Restated   Previously
Reported
  Restated  
Expense Ratios:  
Common Shares:  
Total expenses     1.14 %     1.56 %     1.21 %     1.49 %     1.14 %     1.30 %  
Portfolio Turnover     28 %     26 %     31 %     29 %     28 %     26 %  

 

    2003  
    Previously
Reported
  Restated  
Expense Ratios:  
Common Shares:  
Total expenses     1.03 %     1.17 %  
Portfolio Turnover     66 %     49 %  

 

    2006   2005   2004  
    Previously
Reported
  Restated   Previously
Reported
  Restated   Previously
Reported
  Restated  
Expense Ratios:  
Applicable to Preferred Shares:  
Total expenses     0.72 %     0.99 %     0.77 %     0.95 %     0.71 %     0.81 %  

 

    2003  
    Previously
Reported
  Restated  
Expense Ratios:  
Applicable to Preferred Shares:  
Total expenses     0.68 %     0.77 %  

 

Insured Ohio Fund
Financial Highlights
for the years ending September 30, 2006
2005, 2004 and 2003

    2006   2005   2004  
    Previously
Reported
  Restated   Previously
Reported
  Restated   Previously
Reported
  Restated  
Expense Ratios:  
Common Shares:  
Total expenses     1.19 %     1.60 %     1.18 %     1.43 %     1.17 %     1.30 %  
Portfolio Turnover     20 %     16 %             25 %     23 %  

 


80



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

NOTES TO FINANCIAL STATEMENTS CONT'D

    2003  
    Previously
Reported
  Restated  
Expense Ratios:  
Common Shares:  
Total expenses     1.05 %     1.14 %  
Portfolio Turnover     32 %     19 %  

 

    2006   2005   2004  
    Previously
Reported
  Restated   Previously
Reported
  Restated   Previously
Reported
  Restated  
Expense Ratios:  
Applicable to Preferred Shares:  
Total expenses     0.75 %     1.01 %     0.74 %     0.90 %     0.73 %     0.81 %  

 

    2003  
    Previously
Reported
  Restated  
Expense Ratios:  
Applicable to Preferred Shares:  
Total expenses     0.69 %     0.76 %  

 

Insured Pennsylvania Fund
Financial Highlights
for the years ending September 30, 2006
2005, 2004 and 2003

    2006   2005   2004  
    Previously
Reported
  Restated   Previously
Reported
  Restated   Previously
Reported
  Restated  
Expense Ratios:  
Common Shares:  
Total expenses     1.18 %     1.96 %     1.16 %     1.57 %     1.12 %     1.37 %  
Portfolio Turnover     39 %     22 %     21 %     19 %     17 %     15 %  

 

    2003  
    Previously
Reported
  Restated  
Expense Ratios:  
Common Shares:  
Total expenses     1.03 %     1.17 %  
Portfolio Turnover     34 %     12 %  

 


81



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

NOTES TO FINANCIAL STATEMENTS CONT'D

    2006   2005   2004  
    Previously
Reported
  Restated   Previously
Reported
  Restated   Previously
Reported
  Restated  
Expense Ratios:  
Applicable to Preferred Shares:  
Total expenses     0.74 %     1.23 %     0.73 %     0.99 %     0.69 %     0.84 %  

 

    2003  
    Previously
Reported
  Restated  
Expense Ratios:  
Applicable to Preferred Shares:  
Total expenses     0.68 %     0.77 %  

 

While the Statements of Assets and Liabilities as of September 30, 2005, 2004 and 2003 (not presented herein) have not been reissued to give effect to the restatement, the principal effects of the restatement would be to increase investments and payable for floating rate notes issued by corresponding amounts at each year, with no effect on previously reported net assets. The Statements of Operations for the years ended September 30, 2005, 2004 and 2003 (not presented herein) have not been reissued to give effect to the restatement, but the principal effects of the restatement would be to increase interest income and interest expense and fees by corresponding amounts each year, with no effect on the previously reported net increase in net assets resulting from operations. In connection with the restatement, the Funds have included a statement of cash flows for Insured Municipal Fund II, Insured Massachusetts Fund, Insured Michigan Fund, Insured New Jersey Fund and Insured Pennsylvania Fund for the year ended September 30, 2006.

The Statements of Changes in Net Assets for the year ended September 30, 2004, and for the period from the start of business, November 29, 2002 to September 30, 2003 (not presented herein) have not been reissued to give effect to the restatement, but the principal effects of the restatement, where applicable, would be to revise previously reported net realized gain (loss) from investment transactions, financial future contracts and interest rate swap contracts, and net change in unrealized appreciation (depreciation) from investments, financial futures contracts and interest rate swap contracts by corresponding and offsetting amounts.


82




Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

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

We have audited the accompanying statements of assets and liabilities, including the portfolios of investments, of Eaton Vance Insured Municipal Bond Fund II, Eaton Vance Insured California Municipal Bond Fund II, Eaton Vance Insured Florida Municipal Bond Fund, Eaton Vance Insured Massachusetts Municipal Bond Fund, Eaton Vance Insured Michigan Municipal Bond Fund, Eaton Vance Insured New Jersey Municipal Bond Fund, Eaton Vance Insured New York Municipal Bond Fund II, Eaton Vance Insured Ohio Municipal Bond Fund, and Eaton Vance Insured Pennsylvania Municipal Bond Fund (individually, the "Fund,") (collectively, the "Funds") as of September 30, 2006, and the related statements of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for the three years then ended and for the period from the start of business, November 29, 2002 to September 30, 2003, and the statements of cash flows of Eaton Vance Insured Municipal Bond Fund II, Eaton Vance Insured Massachusetts Municipal Bond Fund, Eaton Vance Insured Michigan Municipal Bond Fund, Eaton Vance Insured New Jersey Municipal Bond Fund, and Eaton Vance Insured Pennsylvania Municipal Bond Fund for the year then ended. These financial statements and financial highlights are the responsibility of each Fund's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. The Funds are not required to have, nor were we engaged to perform, an audit of their internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Funds' internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned at September 30, 2006, by correspondence with the custodian and brokers; where replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Eaton Vance Insured Municipal Bond Fund II, Eaton Vance Insured California Municipal Bond Fund II, Eaton Vance Insured Florida Municipal Bond Fund, Eaton Vance Insured Massachusetts Municipal Bond Fund, Eaton Vance Insured Michigan Municipal Bond Fund, Eaton Vance Insured New Jersey Municipal Bond Fund, Eaton Vance Insured New York Municipal Bond Fund II, Eaton Vance Insured Ohio Municipal Bond Fund, and Eaton Vance Insured Pennsylvania Municipal Bond Fund as of September 30, 2006, the results of their operations for the year then ended, the changes in their net assets for each of the two years in the period then ended, and their financial highlights for the three years then ended and for the period from the start of business, November 29, 2002 to September 30, 2003, and the cash flows of Eaton Vance Insured Municipal Bond Fund II, Eaton Vance Insured Massachusetts Municipal Bond Fund, Eaton Vance Insured Michigan Municipal Bond Fund, Eaton Vance Insured New Jersey Municipal Bond Fund, and Eaton Vance Insured Pennsylvania Municipal Bond Fund for the year then ended in conformity with accounting principles generally accepted in the United States of America.

As discussed in Note 11, for each of the Funds referred to above, the financial statements have been restated.

DELOITTE & TOUCHE LLP
Boston, Massachusetts
November 17, 2006 (March 20, 2007 as to the effects of the restatement discussed in Note 11).


83



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

OTHER MATTERS (Unaudited)

Each Fund held its Annual Meeting of Shareholders on July 21, 2006. The following action was taken by the shareholders of each Fund:

Item 1: The election of William H. Park, Lynn A. Stout and Ralph F. Verni as Class I Trustees of the Fund for a three-year term expiring in 2009:

    Nominee for Class I Trustee
Elected by All Shareholders
William H. Park
  Nominee for Class I Trustee
Elected by All Shareholders
Lynn A. Stout
  Nominee for Class I Trustee
Elected by All Shareholders
Ralph F. Verni
 
Insured California Fund II:  
For     3,702,356       3,700,831       3,702,356    
Withheld     37,155       38,680       37,155    
Insured Florida Fund:  
For     2,483,324       2,482,474       2,482,324    
Withheld     50,159       51,009       51,159    
Insured Massachusetts Fund:  
For     1,725,045       1,725,045       1,725,045    
Withheld     8,530       8,530       8,530    
Insured Michigan Fund:  
For     1,485,700       1,484,500       1,484,500    
Withheld     11,995       13,195       13,195    
Insured Municipal Fund II:  
For     9,506,042       9,501,742       9,503,168    
Withheld     110,979       115,279       113,853    
Insured New Jersey Fund:  
For     2,504,412       2,505,612       2,502,412    
Withheld     31,126       29,926       33,126    
Insured New York II Fund:  
For     2,470,284       2,468,918       2,469,784    
Withheld     45,191       46,557       45,691    
Insured Ohio Fund:  
For     2,437,075       2,437,075       2,433,125    
Withheld     18,958       18,958       22,908    
Insured Pennsylvania Fund:  
For     2,817,874       2,817,924       2,818,474    
Withheld     46,732       46,682       46,132    

 

Results are rounded to the nearest whole number.


84



Eaton Vance Insured Municipal Bond Funds as of September 30, 2006

FEDERAL TAX INFORMATION (Unaudited)

The Form 1099-DIV you receive in January 2007 will show the tax status of all distributions paid to your account in calendar 2006. Shareholders are advised to consult their own tax adviser with respect to the tax consequences of their investment in the Fund. As required by the Internal Revenue Code regulations, shareholders must be notified within 60 days of a Fund's fiscal year end regarding exempt-interest dividends and capital gains dividends.

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

Eaton Vance Insured Municipal Bond Fund II     100.00 %  
Eaton Vance Insured California Municipal Bond Fund II     100.00 %  
Eaton Vance Insured Florida Municipal Bond Fund     100.00 %  
Eaton Vance Insured Massachusetts Municipal Bond Fund     100.00 %  
Eaton Vance Insured Michigan Municipal Bond Fund     100.00 %  
Eaton Vance Insured New Jersey Municipal Bond Fund     99.97 %  
Eaton Vance Insured New York Municipal Bond Fund II     100.00 %  
Eaton Vance Insured Ohio Municipal Bond Fund     100.00 %  
Eaton Vance Insured Pennsylvania Municipal Bond Fund     100.00 %  

 

Capital Gains Dividends — The Eaton Vance Insured New York Municipal Bond Fund II designates $255,263 as a capital gain dividend.


85




Eaton Vance Insured Municipal Bond Funds

DIVIDEND REINVESTMENT PLAN

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

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

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

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

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

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


86



Eaton Vance Insured Municipal Bond Funds

APPLICATION FOR PARTICIPATION IN DIVIDEND REINVESTMENT PLAN

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

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

  Please print exact name on account

  Shareholder signature  Date

  Shareholder signature  Date

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

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

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

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

Number of Employees

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

Number of Shareholders

As of September 30, 2006, our records indicate that there are 32, 10, 4, 7, 10, 11, 19, 18 and 49 registered shareholders for Insured Municipal Fund II, Insured California Fund II, Insured Florida Fund, Insured Massachusetts Fund, Insured Michigan Fund, Insured New Jersey Fund, Insured New York Fund II, Insured Ohio Fund and Insured Pennsylvania Fund, respectively, and approximately 4,800, 1,400, 1,200, 800, 900, 1,400, 1,200, 1,600 and 1,700 shareholders owning the Fund shares in street name, such as through brokers, banks, and financial intermediaries for Insured Municipal Fund II, Insured California Fund II, Insured Florida Fund, Insured Massachusetts Fund, Insured Michigan Fund, Insured New Jersey Fund, Insured New York Fund II, Insured Ohio Fund and Insured Pennsylvania Fund, respectively.

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

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

American Stock Exchange symbols

Insured Municipal Fund II  EIV

Insured California Fund II  EIA

Insured Florida Fund  EIF

Insured Massachusetts Fund  MAB

Insured Michigan Fund  MIW

Insured New Jersey Fund  EMJ

Insured New York Fund II  NYH

Insured Ohio Fund  EIO

Insured Pennsylvania Fund  EIP


87



Eaton Vance Insured Municipal Bond Funds

BOARD OF TRUSTEES' ANNUAL APPROVAL OF THE INVESTMENT ADVISORY AGREEMENTS

Overview of the Contract Review Process

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

At a meeting of the Boards of Trustees (each a "Board") of the Eaton Vance group of mutual funds (the "Eaton Vance Funds") held on March 27, 2006, the Board, including a majority of the Independent Trustees, voted to approve continuation of existing advisory and sub-advisory agreements for the Eaton Vance Funds for an additional one-year period. In voting its approval, the Board relied upon the affirmative recommendation of the Special Committee of the Board, which is a committee comprised exclusively of Independent Trustees. Prior to making its recommendation, the Special Committee reviewed information furnished for a series of meetings of the Special Committee held in February and March 2006. Such information included, among other things, the following:

Information about Fees, Performance and Expenses

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

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

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

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

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

•  Profitability analyses for each adviser with respect to each fund managed by it;

Information about Portfolio Management

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

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

•  Data relating to portfolio turnover rates of each fund;

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

Information about the Adviser

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

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

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

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

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

Other Relevant Information

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

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

•  The terms of each advisory agreement.


88



Eaton Vance Insured Municipal Bond Funds

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

In addition to the information identified above, the Special Committee considered information provided from time to time by each adviser throughout the year at meetings of the Board and its committees. Over the course of the twelve month period ended March 31, 2006, the Board met nine times and the Special Committee, the Audit Committee and the Governance Committee, each of which is a Committee comprised solely of Independent Trustees, met eight, twelve and five times, respectively. At such meetings, the Trustees received, among other things, presentations by the portfolio managers and other investment professionals of each adviser relating to the investment performance of each fund and the investment strategies used in pursuing the fund's investment objective.

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

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

Results of the Process

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

•  Insured Municipal Bond Fund II

•  Insured California Municipal Bond Fund II

•  Insured Florida Municipal Bond Fund

•  Insured Massachusetts Municipal Bond Fund

•  Insured Michigan Municipal Bond Fund

•  Insured New Jersey Municipal Bond Fund

•  Insured New York Municipal Bond Fund II

•  Insured Ohio Municipal Bond Fund

•  Insured Pennsylvania Municipal Bond Fund

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

Nature, Extent and Quality of Services

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

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

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


89



Eaton Vance Insured Municipal Bond Funds

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

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

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

Fund Performance

The Board compared each Fund's investment performance to a relevant universe of similarly managed funds identified by an independent data provider and appropriate benchmark indices. The Board reviewed comparative performance data for the one-year period ended September 30, 2005 for each Fund. On the basis of the foregoing and other relevant information, the Board concluded that the performance of each Fund is satisfactory.

Management Fees and Expenses

The Board reviewed contractual investment advisory fee rates payable by each Fund (referred to as "management fees").

As part of its review, the Board considered each Fund's management fee and total expense ratio for the one-year period ended September 30, 2005, as compared to a group of similarly managed funds selected by an independent data provider. The Board considered the fact that the Adviser had waived fees and/or paid expenses for each of the Funds.

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

Profitability

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

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

Economies of Scale

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


90




Eaton Vance Insured Municipal Bond Funds

MANAGEMENT AND ORGANIZATION

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

Name and
Date of Birth
  Position(s)
with the
Funds
  Term of
Office and
Length of
Service
  Principal Occupation(s)
During Past Five Years
  Number of Portfolios
in Fund Complex
Overseen By
Trustee(1) 
  Other Directorships Held  
Interested Trustee                          
James B. Hawkes 11/9/41   Trustee and Vice President   Trustee until 2007. 3 years. Trustee and Vice President since 2002.   Chairman and Chief Executive Officer of EVC, BMR, EVM and EV; Director of EV; Vice President and Director of EVD. Trustee and/or officer of 168 registered investment companies in the Eaton Vance Fund Complex. Mr. Hawkes is an interested person because of his positions with BMR, EVM, EVC and EV, which are affiliates of each Fund.     168     Director of EVC  
Noninterested Trustee(s)                          
Benjamin C. Esty 1/2/63   Trustee   Until 2008. 3 years. Trustee since 2005   Roy and Elizabeth Simmons Professor of Business Administration, Harvard University Graduate School of Business Administration (since 2003). Formerly, Associate Professor, Harvard University Graduate School of Business Administration (2000-2003).     168     None  
Samuel L. Hayes, III(A) 2/23/35   Trustee and Chairman of the Board   Trustee until 2007. 3 years. Trustee since 2002 and Chairman of the Board since 2005.   Jacob H. Schiff Professor of Investment Banking Emeritus, Harvard University Graduate School of Business Administration. Director of Yakima Products, Inc. (manufacturer of automotive accessories) (since 2001) and Director of Telect, Inc. (telecommunications services company).     168     Director of Tiffany & Co. (specialty retailer)  
William H. Park 9/19/47   Trustee   Until 2009. 3 years. Trustee since 2003.   Vice Chairman, Commercial Industrial Finance Corp. (specialty finance company) (since 2006). Formerly, President and Chief Executive Officer, Prizm Capital Management, LLC (investment management firm) (2002-2005). Formerly, Executive Vice President and Chief Financial Officer, United Asset Management Corporation (a holding company owning institutional investment management firms) (1982-2001).     168     None  
Ronald A. Pearlman 7/10/40   Trustee   Until 2008. 3 years. Trustee since 2003.   Professor of Law, Georgetown University Law Center.     168     None  

 


91



Eaton Vance Insured Municipal Bond Funds

MANAGEMENT AND ORGANIZATION CONT'D

Name and
Date of Birth
  Position(s)
with the
Funds
  Term of
Office and
Length of
Service
  Principal Occupation(s)
During Past Five Years
  Number of Portfolios
in Fund Complex
Overseen By
Trustee(1) 
  Other Directorships Held  
Noninterested Trustee(s) (continued)                          
Norton H. Reamer(A) 9/21/35   Trustee   Until 2008. 3 years. Trustee since 2002.   President, Chief Executive Officer and a Director of Asset Management Finance Corp. (a specialty finance company serving the investment management industry) (since October 2003). President, Unicorn Corporation (an investment and financial advisory services company) (since September 2000). Formerly, Chairman and Chief Operating Officer, Hellman, Jordan Management Co., Inc. (an investment management company) (2000-2003). Formerly, Advisory Director of Berkshire Capital Corporation (investment banking firm) (2002-2003).     168     None  
Lynn A. Stout 9/14/57   Trustee   Until 2009. 3 years. Trustee since 2002.   Professor of Law, University of California at Los Angeles School of Law.     168     None  
Ralph F. Verni 1/26/43   Trustee   Until 2009. 3 years. Trustee since 2005.   Consultant and private investor.     168     None  
Principal Officers who are not Trustees                          

 

Name and
Date of Birth
  Position(s)
with the
Funds
  Term of
Office and
Length of
Service
  Principal Occupation(s)
During Past Five Years
 
Cynthia J. Clemson 3/2/63   President of EIA, EIF, MIW, NYH, EIO and EIP; Vice President of MAB, EIV and EMJ   President of EIA, EIF, MIW, NYH, EIO and EIP since 2005 and Vice President of MAB, EIV and EMJ since 2004(2)   Vice President of EVM and BMR. Officer of 86 registered investment companies managed by EVM or BMR.  
Robert B. MacIntosh 1/22/57   President of MAB, EIV and EMJ; Vice President of EIA, EIF, MIW, NYH, EIO and EIP   President of MAB, EIV and EMJ since 2005 and Vice President of EIA, EIF, MIW, NYH, EIO and EIP since 2002(2)   Vice President of EVM and BMR. Officer of 86 registered investment companies managed by EVM or BMR.  
William H. Ahern, Jr. 7/28/59   Vice President of MIW, EIV and EIO   Vice President of MIW since 2002; of EIV since 2004; and of EIO since 2005   Vice President of EVM and BMR. Officer of 71 registered investment companies managed by EVM or BMR.  
Craig R. Brandon 12/31/66   Vice President of EIF and NYH   Vice President of EIF since 2004; and of NYH since 2005   Vice President of EVM and BMR. Officer of 44 registered investment companies managed by EVM or BMR.  
Thomas M. Metzold 8/3/58   Vice President of EIP   Since 2005   Vice President of EVM and BMR. Officer of 43 registered investment companies managed by EVM or BMR.  
Barbara E. Campbell 6/19/57   Treasurer   Since 2005(2)   Vice President of EVM and BMR. Officer of 168 registered investment companies managed by EVM and BMR.  

 


92



Eaton Vance Insured Municipal Bond Funds

MANAGEMENT AND ORGANIZATION CONT'D

Principal Officers who are not Trustees (continued)  

 

Name and
Date of Birth
  Position(s)
with the
Funds
  Term of
Office and
Length of
Service
  Principal Occupation(s)
During Past Five Years
 
Alan R. Dynner 10/10/40   Secretary   Since 2002   Vice President, Secretary and Chief Legal Officer of BMR, EVM, EVD, EV and EVC. Officer of 168 registered investment companies managed by EVM or BMR.  
Paul M. O'Neil 7/1/53   Chief Compliance Officer   Since 2004   Vice President of EVM and BMR. Officer of 168 registered investment companies managed by EVM or BMR.  

 

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

(2)  Prior to 2005, Ms. Clemson served as Vice President of EIA, EIF and EIP since 2002, and of MIW, NYH and EIO since 2004, Mr. MacIntosh served as Vice President of MAB, EIV and EMI since 2002 and Ms. Campbell served as Assistant Treasurer of all funds since 2002.

(A)  APS Trustee.


93



This Page Intentionally Left Blank



This Page Intentionally Left Blank



This Page Intentionally Left Blank




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

The Eaton Vance Building
255 State Street
Boston, MA 02109

Custodian
Investors Bank & Trust Company

200 Clarendon Street
Boston, MA 02116

Transfer Agent and Dividend Disbursing Agent
PFPC Inc.

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

Independent Registered Public Accounting Firm
Deloitte & Touche LLP

200 Berkeley Street
Boston, MA 02116-5022

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



1557-11/06  9IMBIISRC




Item 2. Code of Ethics

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

Item 3. Audit Committee Financial Expert

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

Item 4. Principal Accountant Fees and Services

(a) –(d)

The following table presents the aggregate fees billed to the registrant for the registrant’s fiscal years ended September 30, 2005 and September 30, 2006 by the Fund’s principal accountant for professional services rendered for the audit of the registrant’s annual financial statements and fees billed for other services rendered by the principal accountant during such period.

Fiscal Years Ended

 

9/30/05

 

9/30/06

 

 

 

 

 

 

 

Audit Fees

 

$

24,215

 

$

25,180

 

 

 

 

 

 

 

Audit-Related Fees(1)

 

3,640

 

3,675

 

 

 

 

 

 

 

Tax Fees(2)

 

6,405

 

6,650

 

 

 

 

 

 

 

All Other Fees(3)

 

0

 

0

 

 

 

 

 

 

 

Total

 

$

34,260

 

$

35,505

 

 


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

(2)                                  Tax fees consist of the aggregate fees billed for professional services rendered by the principal accountant relating to tax compliance, tax advice, and tax planning and specifically include fees for tax return preparation and other tax related compliance/planning matters.

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




(e)(1) The registrant’s audit committee has adopted policies and procedures relating to the pre-approval of services provided by the registrant’s principal accountant (the “Pre-Approval Policies”).  The Pre-Approval Policies establish a framework intended to assist the audit committee in the proper discharge of its pre-approval responsibilities.  As a general matter, the Pre-Approval Policies (i) specify certain types of audit, audit-related, tax, and other services determined to be pre-approved by the audit committee; and (ii) delineate specific procedures governing the mechanics of the pre-approval process, including the approval and monitoring of audit and non-audit service fees.  Unless a service is specifically pre-approved under the Pre-Approval Policies, it must be separately pre-approved by the audit committee.

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

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

(f) Not applicable.

(g) The following table presents (i) the aggregate non-audit fees (i.e., fees for audit-related, tax, and other services) billed to the registrant by the registrant’s principal accountant for the registrant’s fiscal years ended September 30, 2005 and September 30, 2006; and (ii) the aggregate non-audit fees (i.e., fees for audit-related, tax, and other services) billed for services rendered to the Eaton Vance organization for the registrant’s principal accountant for the same time periods, respectively.

Fiscal Years Ended

 

9/30/05

 

9/30/06

 

 

 

 

 

 

 

Registrant

 

$

10,045

 

$

10,325

 

 

 

 

 

 

 

Eaton Vance(1)

 

$

223,443

 

$

72,100

 

 


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

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




Item 5.  Audit Committee of Listed registrants

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

Item 6. Schedule of Investments

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

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

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

 

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




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

 

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

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

 Portfolio Management

Cynthia J. Clemson, portfolio manager of Eaton Vance Insured California Municipal Bond Fund II, is responsible for the overall and day-to-day management of the Fund’s investments.

Ms. Clemson has been an Eaton Vance portfolio manager since 1991 and is a Vice President of EVM and Boston Management and Research, an Eaton Vance subsidiary (“BMR”).  This information is provided as of the date of filing of this report.

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

 

Number 
of All 
Accounts

 

Total Assets 
of All 
Accounts*

 

Number of 
Accounts
Paying a 
Performance
Fee

 

Total Assets of 
Accounts Paying 
a Performance 
Fee*

 

Insured California Municipal Bond Fund II

 

 

 

 

 

 

 

 

 

Cynthia J. Clemson

 

 

 

 

 

 

 

 

 

Registered Investment Companies

 

12

 

$

3,232.5

 

0

 

$

0

 

Other Pooled Investment Vehicles

 

0

 

$

0

 

0

 

$

0

 

Other Accounts

 

0

 

$

0

 

0

 

$

0

 

 


*In millions of dollars. For registered investment companies, assets represent net assets of all




open-end investment companies and gross assets of all closed-end investment companies.

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

 

Dollar Range of 
Equity 
Securities 
Owned in the 
Fund

 

 

 

 

 

Insured California II

 

 

 

Cynthia J. Clemson

 

None

 

 




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

Portfolio Manager Compensation Structure

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

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

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




EVM seeks to compensate portfolio managers commensurate with their responsibilities and performance, and competitive with other firms within the investment management industry. EVM participates in investment-industry compensation surveys and utilizes survey data as a factor in determining salary, bonus and stock-based compensation levels for portfolio managers and other investment professionals. Salaries, bonuses and stock-based compensation are also influenced by the operating performance of EVM and its parent company. The overall annual cash bonus pool is based on a substantially fixed percentage of pre-bonus operating income. While the salaries of EVM’s portfolio managers are comparatively fixed, cash bonuses and stock-based compensation may fluctuate significantly from year to year, based on changes in manager performance and other factors as described herein. For a high performing portfolio manager, cash bonuses and stock-based compensation may represent a substantial portion of total compensation.

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

No such purchases this period.

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

No material changes.

Item 11. Controls and Procedures

(a) The registrant’s principal executive officer and principal financial officer have concluded, based on their evaluation of the effectiveness of the design and operation of the registrant’s disclosure controls and procedures as of January 22, 2007, which is a date within 90 days of the filing date of this report on Form N-CSR, that, as of such date, the design and operation of such procedures are effective to provide reasonable assurance that information required to be disclosed by the registrant in the reports that it files or submits on Form N-CSR is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that information required to be disclosed by the registrant in the reports that it files or submits under the Act is accumulated and communicated to the registrant’s management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure.

Such officers had previously become aware of a control deficiency relating to the operating effectiveness of the Fund’s internal control over financial reporting as of September 30, 2006, related to the review and analysis of the relevant terms and conditions of certain transfers of securities to determine whether the transfers  qualified for sale accounting under the provisions of Statement of Financial Accounting Standards No. 140 “Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities,”  and had reevaluated disclosure controls and procedures and concluded that they were not effective at that date.  The Fund determined that this control deficiency represented a material weakness in internal control over financial reporting at September 30, 2006 as more fully described below in Item 11b.  Subsequent to September 30, 2006, but prior to the evaluation of the design and operation of the registrant’s disclosure controls and procedures at January 22, 2007, the registrant’s disclosure controls and procedures were modified, as described in Item 11(b) below, to enhance the review and analysis of the relevant terms and conditions of transfers of securities in connection with inverse floating rate obligations in light of Statement of Financial Accounting Standards No. 140.

(b) Management of the Fund is responsible for establishing and maintaining effective internal control over financial reporting.  In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of controls.  A fund’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America (“generally accepted accounting principles”).  Such internal control includes policies and procedures that provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of a Fund’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.  Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.




A control deficiency exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect misstatements on a timely basis.  A significant deficiency is a control deficiency, or combination of control deficiencies, that adversely affects the Fund’s ability to initiate, authorize, record, process or report external financial data reliably in accordance with generally accepted accounting principles such that there is more than a remote likelihood that a misstatement of the Fund’s annual or interim financial statements that is more than inconsequential will not be prevented or detected.  A material weakness is a significant deficiency, or combination of significant deficiencies, that results in more than a remote likelihood that a material misstatement of the annual or interim financial statements will not be prevented or detected.

Subsequent to the original filing of the Fund’s Form N-CSR for its fiscal year ended September 30, 2006, management has identified the following control deficiency that was determined to be a material weakness, as defined above, in the Fund’s internal control over financial reporting.  The Fund’s controls related to the review and analysis of the relevant terms and conditions of certain transfers of securities were not operating effectively to appropriately determine whether the transfers qualified for sale accounting under the provisions of Statement of Financial Accounting Standards No. 140 “Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities.”  As a result of this weakness, the statement of assets and liabilities, including the portfolio of investments, as of September 30, 2006, and the related statement of operations for the year then ended and statements of changes in net assets for each of the two years then ended, and certain financial highlights for each of the three years in the period then ended and for the period from the start of the business, November 29, 2002 to September 30, 2003, were restated in order to appropriately account for such transfers of securities as secured borrowings and report the related interest income and expense.  In response to the identified control deficiency, management implemented certain modifications to its controls and control procedures that are designed to enhance their operating effectiveness. There were no changes in registrant’s internal control over financial reporting during the quarter ended September 30, 2006. However, see above for discussion of a control deficiency identified subsequent to the original filing date of the Fund’s Form N-CSR for the year ended September 30, 2006, and for remedial actions taken subsequent to that date.

Item 12. Exhibits

(a)(1)

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

(a)(2)(i)

Treasurer’s Section 302 certification.

(a)(2)(ii)

President’s Section 302 certification.

(b)

Combined Section 906 certification.

 




Signatures

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

Eaton Vance Insured California Municipal Bond Fund II

By:

/s/ Cynthia J. Clemson

 

 

Cynthia J. Clemson

 

President

 

 

 

 

Date:

March 23, 2007

 

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

 

By:

/s/ Barbara E. Campbell

 

 

Barbara E. Campbell

 

Treasurer

 

 

 

 

Date:

March 23, 2007

 

 

 

 

By:

/s/ Cynthia J. Clemson

 

 

Cynthia J. Clemson

 

President

 

 

 

 

Date:

March 23, 2007