THE OAKMARK INTERNATIONAL FUND Report from David G. Herro and Michael J. Welsh, Portfolio Managers

THE VALUE OF A $10,000 INVESTMENT IN THE OAKMARK INTERNATIONAL FUND FROM ITS INCEPTION (9/30/92) TO PRESENT (3/31/04) AS COMPARED TO THE MSCI WORLD EX U.S. INDEX18
	Annual Average Total Returns
	(as of 03/31/04)
	Total Return Last 3 Months*	1-year	5-year	10-year	Since Inception (9/30/92)
Oakmark International Fund (Class I)	3.61%	62.00%	11.36%	9.08%	11.89%
MSCI World ex. U.S.	4.24%	57.16%	0.98%	4.83%	6.69%
MSCI EAFE19	4.34%	57.54%	0.53%	4.55%	6.48%
Lipper International Fund Index20	4.99%	56.57%	2.87%	5.94%	7.99%
The graph and table do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
The performance data quoted represents past performance. Past performance does not guarantee future results.
The fund's high performance may not be repeated. The investment return and principal value will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. Average annual total return measures annualized change, while total return measures aggregate change. To obtain current month end performance data, call 1-800-OAKMARK or visit www.oakmark.com.
* Not annualized

The Oakmark International Fund gained 4% for the quarter, slightly less than the benchmark indices. The returns were lower than the relevant indices primarily due to an underweighted position in the strong Japanese market.

For the past twelve months, your Fund is up 62%. Individual securities that contributed to performance most significantly during the quarter were French pharmaceutical Aventis; European securities exchange Euronext; and two Mexican companies, multimedia and broadcasting power-house Grupo Televisa and beverage company Fomento Economico Mexicano ("FEMSA").

The share price of Aventis was driven up during the quarter by an acquisition bid by Sanofi-Synthelabo, as well as from overtures from Novartis. Management has responded to the situation in a very shareholder-oriented fashion, and is working hard to maximize the value of the company.

Euronext is the pan-European exchange comprising Amsterdam, Paris, Brussels, and Lisbon, as well as the derivatives exchange LIFFE. In 2003, Euronext's operating profit improved significantly, and the share price has also benefited recently from the market's delayed recognition of their strong position in clearing and an increasingly liquid balance sheet.

Positive changes to Televisa's shareholder structure, as well as its continued positive underlying results, have bolstered the share price. Finally, FEMSA continues to show strong results from their brewing business (with brands like Dos Equis and Tecate) as well as from their pan-American soft-drink bottling operations.

The most significant detractor from quarterly performance was UK pharmaceutical GlaxoSmithK-line. Several of our pharmaceutical holdings underperformed during the quarter. These companies continue to suffer from intense debate regarding pricing, disappointing pipelines, and the short-term profit outlook. We continue to believe these concerns are somewhat overblown and already fully reflected in share prices. Our long-term expectations for this industry remain positive. Other underperformers in the portfolio included Lonza (Switzerland) and BMW (Germany).

We continue to like the quality and price attractiveness of the portfolio. Thank you for your continued confidence.

David G. Herro, CFA Portfolio Manager dherro@oakmark.com	Michael J. Welsh, CFA, CPA Portfolio Manager mwelsh@oakmark.com

International Diversification—March 31, 2004 (Unaudited)

Schedule of Investments—March 31, 2004 (Unaudited)

See accompanying notes to financial statements.