THE OAKMARK INTERNATIONAL FUND Report from David G. Herro

THE VALUE OF A $10,000 INVESTMENT IN THE OAKMARK INTERNATIONAL FUND FROM ITS INCEPTION (9/30/92) TO PRESENT (6/30/07) AS COMPARED TO THE MSCI WORLD EX U.S. INDEX14     Average Annual Total Returns (as of 6/30/07)   Total Return Last 3 Months* 1-year 5-year 10-year Since Inception (9/30/92) Oakmark International Fund (Class I) 3.18% 24.71% 17.38% 11.52% 13.83% MSCI World ex U.S. 6.98% 27.09% 18.14% 7.97% 9.66% MSCI EAFE15 6.40% 27.00% 17.73% 7.66% 9.41% Lipper International Fund Index16 7.49% 28.40% 17.55% 8.54% 10.63% 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. Expense Ratio as of 9/30/06 was 1.08%. 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 most recent month-end performance data, visit oakmark.com. * Not annualized

The Oakmark International Fund returned 3% for the quarter ending June 30, 2007, lagging behind the return of 7% for the MSCI World ex U.S. Index. More importantly, however, since the Fund’s inception in September 1992, it is up 14% per annum, which compares favorably with the MSCI World ex U.S. Index’s return of 10% over the same period.

Impact Players

Adecco, a Swiss-based personnel and temporary employment company, was this quarter’s largest contributor, returning 24%. The new management team put in place in 2006 has boosted Adecco’s profitability, and the business continues to grow. Another top contributor was British Sky Broadcasting Group (“BSkyB”), the United Kingdom’s number one pay-television operator, returning 16% for the quarter. In addition to continued strong results in its pay-television business, BSkyB has made excellent progress in attracting both new and existing customers to its recently launched broadband and telephony service. DaimlerChrysler was once again a top performer this quarter, returning 16% and rounding out the top three positive contributors to the Fund’s performance. Most of the stock price’s increase resulted from the announcement of the sale of 80% of the Chrysler division to Cerberus. While Daimler AG will maintain 20% ownership in Chrysler Holding LLC, it will be divested of the pension and health care obligations.

Portfolio Composition

We sold our positions in Total and Swatch Group as they reached their respective sell targets. Multiple additions to the portfolio during the quarter included G4S, a United Kingdom based security services provider; Allianz, one of the world’s largest insurance conglomerates; ASML Holdings, a developer, producer, and marketer of semiconductor manufacturing equipment; and LVMH, a luxury goods conglomerate that produces products such as Veuve Clicquot champagne, Tag watches, Vuitton leathers, and couture through Christian Dior.

The portfolio composition remains relatively similar to last quarter, geographically speaking. We remain heavily weighted in the UK and Europe, which represent approximately 70% of our holdings. Japanese holdings remain underweight at 15% compared to the MSCI World ex U.S. weighting of 20%.

In closing we would like to remind you that we measure our performance over the long term. Short-term fluctuations in the market actually create opportunities for us to invest in under-valued foreign companies that have fallen out of favor in the marketplace. We continue to focus on finding attractive, under-valued foreign companies with management teams focused on building shareholder value.

June 30, 2007

International Diversification—June 30, 2007 (Unaudited)

Schedule of Investments—June 30, 2007 (Unaudited)