THE OAKMARK GLOBAL FUND Report from Clyde S. McGregor and Michael J. Welsh, Portfolio Managers

THE VALUE OF A $10,000 INVESTMENT IN THE OAKMARK GLOBAL FUND FROM ITS INCEPTION (8/4/99) TO PRESENT (12/31/04) AS COMPARED TO THE MSCI WORLD INDEX12
	Annual Average Total Returns (as of 12/31/04)
	Total Return Last 3 Months*	1-year	5-year	Since Inception (8/4/99)
Oakmark Global Fund (Class I)	13.00%	15.63%	18.56%	17.01%
MSCI World	11.94%	14.72%	-2.45%	0.36%
Lipper Global Fund Index13	12.07%	14.38%	-1.10%	2.68%
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. The above performance information for the Fund does not reflect the imposition of a 2% redemption fee on shares held for 90 days or less to deter market timers. If reflected, the fee would reduce the performance quoted. Past performance does not guarantee future results. 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

Fellow Shareholders,
The Oakmark Global Fund gained 13% for the three-month period ending December 31, 2004, compared with the 12% increases for both the MSCI World Index and the Lipper Global Fund Index.

Over the past twelve months, The Oakmark Global Fund has returned 16%, compared to gains of 15% for the MSCI World Index and 14% for the Lipper Global Fund Index. Most importantly, since inception the Fund has achieved a 17% annualized return while the MSCI World Index was flat and the Lipper Global Fund Index had a 3% annualized return.

Looking Back
In this letter we want to take the opportunity to look back a bit at the significant contributors to the Fund's NAV⁴ for calendar year 2004. Fortunately, this year the positive contributors dwarfed the negatives.

U.S. energy independent Burlington Resources provided the most significant positive contribution to the Fund's NAV over the past twelve months. The share price reacted favorably to the continued strong pricing for natural gas in North America. Management continues to make intelligent capital allocation decisions, including share repurchases and increasing dividends.

Bank of Ireland also contributed significantly to performance, as fears about a slowing Irish economy and increased competition gave way to the recognition of the Bank's undervalued franchise. The Bank continues to face challenges—in addition to the economy and competition, problems include the weakness of their UK branch network, Bristol & West, and their Bank of Ireland Asset Management business. But we believe the current valuation reflects an outlook that is far too pessimistic.

Takeda Pharmaceutical also did well over the past twelve months. Despite the closing of a bit of the gap between price and value, Takeda remains very undervalued in our opinion. Management aggressively controls costs, and, in a step that's very rare for Japan, it has instituted a variable compensation scheme for every employee. As Takeda's President

Yasuchika Hasegawa told us a few months back, "If you want to be paid well, you have to perform." It may sound elementary, but it's still fairly revolutionary in Japan. With a cash-rich balance sheet and strong profitability, we believe Takeda deserves a valuation far above the single-digit multiple of operating profit reflected by the current share price.

French-based mail and services company Neopost had strong performance in 2004, as sales and profits came in better than original estimates. A global player in franking machines and services, Neopost's results were driven by the integration of their recent Hasler acquisition, market share gains, and postal decertification in Europe.

Efunds, a leading factor in the U.S. market for payment processing, was another standout performer. The company's software is used to process the majority of debit card transactions in the U.S. In September, the company announced the sale of its automatic teller business at a valuation that the stock market deemed quite favorable.

The share price of Grupo Televisa had another very strong run in 2004. This Mexican media conglomerate generated higher than expected growth this year, on top of exceptional election-year earnings in 2003. An impressive hike in the dividend also helped move the share price.

Other companies that strongly contributed to the Fund's NAV were Laboratory Corp of America, Euronext N.V. (Europe), Ansell (Australia), and Vivendi Universal (France).

Now, the one piece of bad news. Synopsys, a leading player in the electronic design automation industry, was the Fund's only position that significantly hampered performance in 2004. We very much liked the company's position in an oligopolistic market, its strong returns on capital, and the expected long-term secular growth rate. Most attractive for us was its valuation, trading at a single-digit multiple of operating profit. Unfortunately, we overestimated the positives, and as a consequence the value of the business. A succession of disappointments and the clear lack of pricing power caused us to revise our original business value estimates to a substantially lower level. We sold our entire position this past quarter.

Looking Forward
We remain excited about the value and quality of the names in the Fund. Thank you for your continued confidence and support, and all the best to you and your family in the New Year.

Clyde S. McGregor, CFA Portfolio Manager mcgregor@oakmark.com	Michael J. Welsh, CFA, CPA Portfolio Manager mwelsh@oakmark.com

Global Diversification—December 31, 2004 (Unaudited)

Schedule of Investments—December 31, 2004 (Unaudited)