Edgar Filing: FIRST TRUST VALUE LINE R 100 FUND

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES

Investment Company Act file number 811-21336
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FIRST TRUST VALUE LINE(R) 100 FUND
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(Exact name of registrant as specified in charter)

1001 Warrenville Road, Suite 300
LISLE, IL 60532
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(Address of principal executive offices) (Zip code)

CT Corporation System
101 Federal Street
BOSTON, MA 02110
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(Name and address of agent for service)

registrant's telephone number, including area code: 630-241-4141
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Date of fiscal year end: DECEMBER 31
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Date of reporting period: DECEMBER 31, 2004
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Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.

A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. ss. 3507.

ITEM 1. REPORTS TO STOCKHOLDERS.

The Report to Shareholders is attached herewith.

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FIRST TRUST VALUE LINE(R) 100 FUND
ANNUAL REPORT
FOR THE YEAR ENDED DECEMBER 31, 2004
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TABLE OF CONTENTS
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FIRST TRUST VALUE LINE(R) 100 FUND
DECEMBER 31, 2004

Shareholder Letter ..................................................................................... 1

Portfolio Commentary ................................................................................... 2

Portfolio Components ................................................................................... 4

Portfolio of Investments ............................................................................... 5

Statement of Assets and Liabilities .................................................................... 9

Statement of Operations ................................................................................ 10

Statements of Changes in Net Assets .................................................................... 11

Financial Highlights ................................................................................... 12

Notes to Financial Statements .......................................................................... 13

Report of Independent Registered Public Accounting Firm ................................................ 16

Dividend Reinvestment Plan ............................................................................. 17

Proxy Voting Policies and Procedures ................................................................... 18

Portfolio Holdings ..................................................................................... 18

Tax Information ........................................................................................ 18

Submission of Matters to a Vote of Shareholders ........................................................ 18

Management ............................................................................................. 19

HOW TO READ THIS REPORT

This report contains information that can help you evaluate your investment. It
includes details about the First Trust Value Line(R) 100 Fund (the "Fund") and
presents data and analysis that provide insight into the Fund's performance and
investment approach.

By reading the letter from the Fund's President, James A. Bowen, together with
the commentary by Robert F. Carey, who is the Chief Investment Officer of First
Trust Advisors L.P., the Fund's investment advisor, you will obtain an
understanding of how the market environment affected its performance. The
statistical information that follows can help you understand the Fund's
performance compared to that of relevant market benchmarks.

It is important to keep in mind that the opinions expressed by Mr. Bowen, Mr.
Carey and First Trust Advisors L.P. personnel are just that: informed opinions.
They should not be considered to be promises or advice. The opinions, like the
statistics, cover the period through the date on the cover of this report. Of
course, the risks of investing in the Fund are spelled out in the prospectus.

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SHAREHOLDER LETTER
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FIRST TRUST VALUE LINE(R) 100 FUND
ANNUAL REPORT
DECEMBER 31, 2004

Dear Shareholders:

The First Trust Value Line(R) 100 Fund (the "Fund") began trading on the
American Stock Exchange on June 12, 2003, and trades under the ticker symbol
FVL. In 2004, the Fund posted a market price total return of 7.9% and a net
asset value (NAV) total return of 13.1%. For comparative purposes, the S&P 500
Index posted a total return of 10.9% in 2004. The Fund's market share price
traded at a 5.26% discount to its NAV on December 31, 2004, but the discount has
since expanded to 10.26% as of February 14, 2005. The Fund does not employ any
leverage.

We are pleased to report that the Fund made two distributions to shareholders in
2004. The first was a $0.27 per share ordinary income distribution (from
short-term capital gain) paid on October 8, 2004. The second was a $0.39 per
share distribution paid on December 30, 2004, of which $0.15 per share was
ordinary income (again from short-term capital gain) and $0.24 per share was a
long-term capital gain distribution. Due to the fact that the Fund has traded at
a discount for the majority of its existence, which is only a little over 18
months, we believe these distributions are a positive because they unlock for
the investor some of the accumulated appreciation in the Fund's NAV. The Fund's
NAV has risen from $14.33 per share at inception to $18.03 as of February 14,
2005. We believe the rise in the NAV reflects well on the Fund's investment
strategy to date.

As you know, the Fund's investment strategy is growth-oriented. Growth stocks
have lagged value stocks in the large-cap, mid-cap and small-cap categories for
the past two calendar years. In 2004, large-cap value stocks outperformed
large-cap growth stocks by 9.5 percentage points, as measured by Standard &
Poor's. In 2003, that margin of difference was 6.1 percentage points.

According to data from Russell, growth stocks have not been this cheap relative
to value stocks in at least 25 years based on price-to-sales data. The
price/sales multiple for the Russell 1000(R) Growth Index was 2.2 as of December
31, 2004, vs. 1.5 for the Russell 1000(R) Value Index. The 2.2 multiple for the
Russell 1000(R) Growth Index is below its 10-year average of about 2.65, while
the 1.5 multiple for the Russell 1000(R) Value Index is higher than its 10-year
average of about 1.25.

The overall state of the economy improved in 2004. According to the latest
estimate from the Blue Chip Economic Indicators(R), 2004 GDP growth in the U.S.
should come in around 4.4%, up from 3.1% in 2003. In our opinion, this is very
encouraging considering the ongoing war in Iraq and high energy prices. Over the
past 16 months the U.S. has added nearly 2.5 million people to the workforce.
Since consumer spending accounts for roughly two-thirds of our annual GDP in the
U.S., which is currently in the vicinity of $11.6 trillion, having more workers
on the payrolls, in our opinion, is a positive for Corporate America. Perhaps
the most encouraging sign that Corporate America is healthy heading into 2005 is
the fact that the companies in the S&P 500 Index, including financial firms, are
currently holding a record $2 trillion in cash and equivalents.

I encourage shareholders to read the commentary by Bob Carey, Chief Investment
Officer at First Trust Advisors.

We appreciate your continuing confidence in our Fund.

Sincerely,

/S/ JAMES A. BOWEN
James A. Bowen
President of the First Trust Value Line(R) 100 Fund
February 15, 2005

Page 1

[PHOTO]
ROBERT F.CAREY

ROBERT F. CAREY, CFA
SENIOR VICE PRESIDENT, CHIEF INVESTMENT OFFICER
FIRST TRUST ADVISORS L.P.

Mr. Carey is responsible for the overall management of research and analysis of
the First Trust product line. Mr. Carey has over 18 years of experience as an
Equity and Fixed-Income Analyst and is a recipient of the Chartered Financial
Analyst (CFA) designation. He is a graduate of the University of Illinois at
Champaign-Urbana with a B.S. in Physics. He is also a member of the Investment
Analysts Society of Chicago and the CFA Institute.

Mr. Carey has appeared as a guest on such programs as Bloomberg TV and CNBC and
has been quoted by several publications, including The Wall Street Journal, The
Wall Street Reporter, Bloomberg News Service, and Registered Rep.
--------------------------------------------------------------------------------
A COMMENTARY ON THE FIRST TRUST VALUE LINE(R) 100 FUND
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A REVIEW OF THE FUND'S INVESTMENT STRATEGY

The Fund adheres to a disciplined strategy of investing in the 100 common stocks
ranked #1 in the Value Line(R) Timeliness(TM) Ranking System. The Value Line(R)
Timeliness(TM) Ranking System was introduced in 1965. Each week, Value Line(R)
applies its Timeliness(TM) Ranking System to screen a wide array of data using a
series of proprietary calculations to rank each of the approximately 1,700
stocks in the Value Line(R) universe for expected price performance over the
next 6 to 12 months. Only 100 stocks are given Value Line's #1 ranking for
Timeliness(TM) at any given time.

Each week the Fund makes portfolio adjustments to match changes initiated by
Value Line(R) to the 100 stocks ranked #1 for Timeliness(TM). When a new stock
attains a #1 ranking, it is added to the Fund's portfolio and stocks no longer
ranked #1 are removed from the Fund's portfolio. In 2004, 4.4 stocks on average
were changed in a given week, essentially the same as in 2003. The Fund
rebalances its holdings on a quarterly basis so that each stock is equally
weighted on the rebalancing date.

PERFORMANCE OF THE FUND

Based on the first ten months of the year, it looked as though stocks were going
to net investors very little in the way of gains in 2004. But thanks to a
post-election rally, 2004 turned out to be a respectable year. From January
through October, the net asset value (NAV) total return for the Fund was only
1.7%, vs. 3.1% for the S&P 500 Index. The Fund's market price total return was
-5.3%. Focusing on the last two months of 2004, after President Bush had been
re-elected on November 2nd, the returns were significantly better. From November
through December, the NAV total return for the Fund was 11.2%, vs. 7.6% for the
S&P 500. The Fund's market price total return outperformed both of these
comparative returns by gaining 13.9%.

Shown on the chart below are the market value and NAV total returns of the Fund
in 2004. We have also included for comparative purposes the returns for the S&P
500 Index, the S&P 400 Index (mid-caps) and the S&P 600 Index (small-caps). The
returns depicted assume reinvestment of dividends and capital gain
distributions.

[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

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COMPARATIVE TOTAL RETURNS
12 Months Ended December 31, 2004

FVL MARKET...........7.9%
FVL NAV.............13.1%
S&P 400.............10.4%
S&P 500.............10.9%
S&P 600.............11.7%

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Page 2

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A COMMENTARY ON THE FIRST TRUST VALUE LINE(R) 100 FUND - CONTINUED
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THE COMPOSITION OF THE FUND

The Fund had a large capitalization orientation to its portfolio holdings as of
December 31, 2004. The average market capitalization of the issuers of the
stocks in the portfolio was approximately $11.7 billion, up from $9.7 billion at
the end of 2003, which happened to be at the high end of our mid-cap range of $2
billion to $10 billion. The breakdown of the 100 stocks in the portfolio as of
December 31, 2004, was as follows: Large-Cap stocks (26), Mid-Cap stocks (35)
and Small-Cap stocks (39). The breakdown of the 100 stocks as of December 31,
2003, was as follows: Large-Cap stocks (20), Mid-Cap stocks (53) and Small-Cap
stocks (27). The Fund's beta averaged about 1.1 for 2004, according to
Bloomberg. That implies a risk level just slightly higher than the overall
market.

A RECAP OF THE EQUITIES MARKETS IN 2004

The thing that stands out about the market in 2004 is that equities in all three
major market capitalization groups (large-, mid- and small-caps) posted returns
(see chart) on average that were below where their respective corporate earnings
estimates finished the year. According to Thomson First Call, the estimated
earnings growth for the companies in the S&P 500, S&P 400 and S&P 600 Indexes
for 2004 were as follows: S&P 500 (+19%), S&P 400 (+20%) and S&P 600 (+26%).

An interesting trend that continued in 2004 was small-cap stocks maintaining
their leadership role in the market. From 1999-2004, the S&P 500 Index posted an
average annual total return of +1.3%, versus +10.4% for the S&P 400 Index and
+11.7% for the S&P 600 Index. There have only been two periods since 1926 when
small stocks have outperformed large stocks for more than six consecutive years:
(1974 through 1983) and (1938 through 1945), according to Ibbotson Associates.

A key provision in a new corporate tax law enacted this past October will
encourage many U.S. multinationals to repatriate profits earned overseas prior
to 2003, and kept overseas in subsidiaries, by taxing such profits at only a
5.25% rate if brought back to the U.S. by the end of 2005. The usual corporate
rate is 35%. The U.S. Treasury Department has stated that the tax break it is
offering will not be granted if the money is to be used for stock buybacks or
dividends. The repatriated profits can be used to reduce debt or to make
acquisitions. The one-time tax break is intended to help the overall economy.
The Treasury would like to see tax savings spent on new hires, capital spending,
R&D, advertising, marketing and to shore up underfunded pensions. We view this
as a pro-growth initiative and a potential positive for growth stocks.

IN CLOSING

The First Trust Value Line(R) 100 Fund seeks to invest in stocks with good
earnings growth and favorable price momentum. During the period covered by this
report, the Fund was diversified via market capitalization and because of the
weekly revisions to the portfolio to match changes in the Value Line(R)
TimelinessTM Ranking System; the average market capitalization of this portfolio
going forward should vary over time.

CAUTION REGARDING FORWARD-LOOKING STATEMENTS

THIS ANNUAL REPORT CONTAINS CERTAIN FORWARD-LOOKING STATEMENTS WITHIN THE
MEANING OF SECTION 27A OF THE SECURITIES ACT OF 1933. FORWARD-LOOKING STATEMENTS
INCLUDE STATEMENTS REGARDING THE GOALS, BELIEFS, PLANS OR CURRENT EXPECTATIONS
OF FIRST TRUST ADVISORS L.P. AND ITS REPRESENTATIVES, TAKING INTO ACCOUNT THE
INFORMATION CURRENTLY AVAILABLE TO THEM. FORWARD-LOOKING STATEMENTS INCLUDE ALL
STATEMENTS THAT DO NOT RELATE SOLELY TO CURRENT OR HISTORICAL FACT. FOR EXAMPLE,
FORWARD-LOOKING STATEMENTS INCLUDE THE USE OF WORDS SUCH AS "ANTICIPATE,"
"ESTIMATE," "INTEND," "EXPECT," "BELIEVE," "PLAN," "MAY," "SHOULD," "WOULD," OR
OTHER WORDS THAT CONVEY UNCERTAINTY OF FUTURE EVENTS OR OUTCOMES.

FORWARD-LOOKING STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND
OTHER FACTORS THAT MAY CAUSE THE FUND'S ACTUAL RESULTS, PERFORMANCE OR
ACHIEVEMENTS TO BE MATERIALLY DIFFERENT FROM ANY FUTURE RESULTS, PERFORMANCE OR
ACHIEVEMENTS EXPRESSED OR IMPLIED BY THE FORWARD-LOOKING STATEMENTS. WHEN
EVALUATING THE INFORMATION INCLUDED IN THIS ANNUAL REPORT, YOU ARE CAUTIONED NOT
TO PLACE UNDUE RELIANCE ON THESE FORWARD-LOOKING STATEMENTS, WHICH REFLECT THE
JUDGMENT OF FIRST TRUST ADVISORS L.P. AND ITS REPRESENTATIVES ONLY AS OF THE
DATE HEREOF. WE UNDERTAKE NO OBLIGATION TO PUBLICLY REVISE OR UPDATE THESE
FORWARD-LOOKING STATEMENTS TO REFLECT EVENTS AND CIRCUMSTANCES THAT ARISE AFTER
THE DATE HEREOF.

Page 3

FIRST TRUST VALUE LINE(R) 100 FUND
PORTFOLIO COMPONENTS+
DECEMBER 31, 2004

[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

Software ......................................... 13.2%
Metals & Mining .................................. 6.2%
Specialty Retail ................................. 6.0%
Road & Rail ...................................... 6.0%
Household Durables ............................... 5.3%
IT Services ...................................... 4.9%
Health Care Providers & Services ................. 4.8%
Hotels, Restaurants & Leisure .................... 4.0%
Oil & Gas ........................................ 3.9%
Chemicals ........................................ 3.8%
Electrical Equipment ............................. 3.2%
Computers & Peripherals .......................... 3.1%
Aerospace & Defense .............................. 3.1%
Health Care Equipment & Supplies ................. 3.0%
Communications Equipment ......................... 3.0%
Commercial Services & Supplies ................... 2.8%
Food & Staples Retailing ......................... 2.7%
Semiconductors & Semiconductor Equipment ......... 2.3%
Internet & Software Services ..................... 2.0%
Biotechnology .................................... 2.0%
Multiline Retail ................................. 1.8%
Industrial Conglomerates ......................... 1.2%
Machinery ........................................ 1.1%
Internet & Catalog Retail ........................ 1.1%
Energy Equipment & Services ...................... 1.1%
Wireless Telecommunication Services .............. 1.0%
Capital Markets .................................. 1.0%
Consumer Finance ................................. 1.0%
Air Freight & Logistics .......................... 0.9%
Textiles, Apparel & Luxury Goods ................. 0.9%
Electric Utilities ............................... 0.9%
Paper & Forest Products .......................... 0.9%
Construction Materials ........................... 0.9%
Electronic Equipment & Instruments ............... 0.9%

+ Percentages are based on total investments. Please note that the percentages
shown on the Portfolio of Investments are based on net assets.

Page 4 See Notes to Financial Statements.

FIRST TRUST VALUE LINE(R) 100 FUND
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 2004

MARKET
SHARES VALUE
------------ ------------

COMMON STOCKS - 99.8%

SOFTWARE - 13.2%
53,882 Adobe Systems, Inc. ............................ $ 3,380,557
111,546 Autodesk, Inc. ................................. 4,233,171
113,520 Citrix Systems, Inc.* .......................... 2,784,646
75,799 Cognos, Inc.* .................................. 3,339,704
56,300 FactSet Research Systems, Inc. ................. 3,290,172
122,716 Internet Security Systems, Inc.* ............... 2,853,147
57,300 Kronos, Inc.* .................................. 2,929,749
138,717 Macromedia, Inc.* .............................. 4,316,873
52,656 Mercury Interactive Corp.* ..................... 2,398,481
211,800 Oracle Corp.* .................................. 2,905,896
121,800 RSA Security, Inc.* ............................ 2,443,308
108,702 Symantec Corp.* ................................ 2,800,163
293,671 TIBCO Software, Inc.* .......................... 3,917,571
--------------
41,593,438
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METALS & MINING - 6.2%
254,496 AK Steel Holding Corp.* ........................ 3,682,557
57,991 Carpenter Technology Corp. ..................... 3,390,154
71,275 Commercial Metals Company ...................... 3,603,664
60,600 Nucor Corp. .................................... 3,171,804
36,369 Peabody Energy Corp. ........................... 2,942,616
96,400 Steel Technologies, Inc. ....................... 2,651,964
--------------
19,442,759
--------------

SPECIALTY RETAIL - 6.0%
84,400 Aeropostale, Inc.* ............................. 2,483,892
71,581 American Eagle Outfitters, Inc. ................ 3,371,465
71,400 Bed, Bath & Beyond, Inc.* ...................... 2,843,862
97,183 Building Materials Holding Corp. ............... 3,721,137
73,032 The Home Depot, Inc. ........................... 3,121,388
77,646 Urban Outfitters, Inc.* ........................ 3,447,482
--------------
18,989,226
--------------

ROAD & RAIL - 5.9%
72,761 Arkansas Best Corp. ............................ 3,266,241
47,400 Canadian National Railway Company .............. 2,903,250
123,100 Heartland Express, Inc. ........................ 2,766,057
73,729 J.B. Hunt Transport Services, Inc. ............. 3,306,746
88,894 Norfolk Southern Corp. ......................... 3,217,074
58,675 Yellow Roadway Corp.* .......................... 3,268,784
--------------
18,728,152
--------------

HOUSEHOLD DURABLES - 5.2%
52,450 Garmin Ltd. .................................... 3,191,058
24,807 Harman International Industries, Inc. .......... 3,150,489
4,951 NVR, Inc.* ..................................... 3,809,299
38,159 The Black & Decker Corp. ....................... 3,370,585
43,900 Toll Brothers, Inc.* ........................... 3,011,979
--------------
16,533,410
--------------

See Notes to Financial Statements. Page 5

FIRST TRUST VALUE LINE(R) 100 FUND - (CONTINUED)
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 2004

MARKET
SHARES VALUE
------------ ------------

COMMON STOCKS - CONTINUED

IT SERVICES - 4.9%
49,300 Affiliated Computer Services, Inc., Class A* ... $ 2,967,367
80,462 Anteon International Corp.* .................... 3,368,139
48,443 CACI International, Inc.* ...................... 3,300,422
75,212 Cognizant Technology Solutions Corp.* .......... 3,183,724
343,758 Sapient Corp.* ................................. 2,719,126
--------------
15,538,778
--------------
HEALTH CARE PROVIDERS & SERVICES - 4.8%
27,690 Aetna, Inc. .................................... 3,454,328
80,600 American Healthways, Inc.* ..................... 2,663,024
104,340 Community Health Systems, Inc.* ................ 2,908,999
79,180 The Advisory Board Company* .................... 2,920,159
35,600 UnitedHealth Group, Inc. ....................... 3,133,868
--------------
15,080,378
--------------
HOTELS, RESTAURANTS & LEISURE - 4.0%
199,400 CKE Restaurants, Inc.* ......................... 2,893,294
51,800 P.F. Chang's China Bistro, Inc.* ............... 2,918,930
58,500 Starbucks Corp.* ............................... 3,648,060
57,680 Station Casinos, Inc. .......................... 3,153,942
--------------
12,614,226
--------------
OIL & GAS - 3.9%
69,300 Berry Petroleum Company, Class A ............... 3,305,610
152,500 OMI Corp. ...................................... 2,569,625
65,974 Southwestern Energy Company* ................... 3,344,222
85,861 XTO Energy, Inc. ............................... 3,037,762
--------------
12,257,219
--------------
CHEMICALS - 3.8%
56,415 Eastman Chemical Company ....................... 3,256,838
51,200 Georgia Gulf Corp. ............................. 2,549,760
111,000 Lyondell Chemical Company ...................... 3,210,120
132,000 Olin Corp. ..................................... 2,906,640
--------------
11,923,358
--------------
ELECTRICAL EQUIPMENT - 3.2%
79,017 II-VI, Inc.* ................................... 3,357,432
69,381 Rockwell Automation, Inc. ...................... 3,437,829
110,191 Thomas & Betts Corp.* .......................... 3,388,373
--------------
10,183,634
--------------

COMPUTERS & PERIPHERALS - 3.1%
50,548 Apple Computer, Inc.* .......................... 3,255,291
80,187 Dell, Inc.* .................................... 3,379,080
97,100 Network Appliance, Inc.* ....................... 3,225,662
--------------
9,860,033
--------------

Page 6 See Notes to Financial Statements.

FIRST TRUST VALUE LINE(R) 100 FUND - (CONTINUED)
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 2004

MARKET
SHARES VALUE
------------ ------------

COMMON STOCKS - CONTINUED

AEROSPACE & DEFENSE - 3.1%
70,863 Armor Holdings, Inc.* .......................... $ 3,331,978
42,943 L-3 Communications Holdings, Inc. .............. 3,145,145
84,167 United Industrial Corp. ........................ 3,260,630
--------------
9,737,753
--------------

HEALTH CARE EQUIPMENT & SUPPLIES - 3.0%
53,123 Biosite, Inc.* ................................. 3,269,189
113,983 Cytyc Corp.* ................................... 3,142,511
123,265 Intermagnetics General Corp.* .................. 3,132,164
--------------
9,543,864
--------------

COMMUNICATIONS EQUIPMENT - 3.0%
114,029 Juniper Networks, Inc.* ........................ 3,100,449
73,856 QUALCOMM, Inc. ................................. 3,131,494
37,583 Research IN Motion Ltd.* ....................... 3,097,591
--------------
9,329,534
--------------

COMMERCIAL SERVICES & SUPPLIES - 2.8%
42,100 Bright Horizons Family Solutions, Inc.* ........ 2,726,396
127,624 Cendant Corp. .................................. 2,983,849
146,371 Korn/Ferry International* ...................... 3,037,198
--------------
8,747,443
--------------

FOOD & STAPLES RETAILING - 2.7%
51,948 Costco Wholesale Corp. ......................... 2,514,803
77,900 Nash Finch Company ............................. 2,941,504
78,053 Walgreen Company ............................... 2,994,893
--------------
8,451,200
--------------

SEMICONDUCTORS &
SEMICONDUCTOR EQUIPMENT - 2.3%
90,950 Cree, Inc.* .................................... 3,645,276
101,973 Marvell Technology Group Ltd.* ................. 3,616,982
--------------
7,262,258
--------------

INTERNET SOFTWARE & SERVICES - 2.0%
62,370 Websense, Inc.* ................................ 3,163,406
86,203 Yahoo!, Inc.* .................................. 3,248,129
--------------
6,411,535
--------------

BIOTECHNOLOGY - 2.0%
86,314 Affymetrix, Inc.* .............................. 3,154,777
49,160 Amgen, Inc.* ................................... 3,153,614
--------------
6,308,391
--------------

MULTILINE RETAIL - 1.8%
76,112 J.C. Penny Company, Inc. ....................... 3,151,037
53,100 Kohl's Corp.* .................................. 2,610,927
--------------
5,761,964
--------------

See Notes to Financial Statements. Page 7

FIRST TRUST VALUE LINE(R) 100 FUND - (CONTINUED)
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 2004

MARKET
SHARES VALUE
------------ ------------

COMMON STOCKS - CONTINUED

INDUSTRIAL CONGLOMERATES - 1.2%
148,105 Park-Ohio Holdings Corp.* ...................... $ 3,835,920
--------------

MACHINERY - 1.1%
80,508 Joy Global, Inc. ............................... 3,496,462
--------------

INTERNET & CATALOG RETAIL - 1.1%
29,204 eBay, Inc.* .................................... 3,395,841
--------------

ENERGY EQUIPMENT & SERVICES - 1.1%
83,221 Cal Dive International, Inc.* .................. 3,391,256
--------------

WIRELESS TELECOMMUNICATION SERVICES - 1.0%
112,611 Western Wireless Corp., Class A* ............... 3,299,502
--------------

CAPITAL MARKETS - 1.0%
72,700 SEI Investments Company ........................ 3,048,311
--------------

CONSUMER FINANCE - 1.0%
56,800 SLM Corp. ...................................... 3,032,552
--------------

AIR FREIGHT & LOGISTICS - 0.9%
53,750 C.H. Robinson Worldwide, Inc. .................. 2,984,200
--------------

TEXTILES, APPAREL & LUXURY GOODS - 0.9%
97,400 Quiksilver, Inc.* .............................. 2,901,546
--------------

ELECTRIC UTILITIES - 0.9%
44,600 TXU Corp. ...................................... 2,879,376
--------------

PAPER & FOREST PRODUCTS - 0.9%
83,200 MeadWestvaco Corp. ............................. 2,819,648
--------------

CONSTRUCTION MATERIALS - 0.9%
98,785 Headwaters, Inc.* .............................. 2,815,373
--------------

ELECTRONIC EQUIPMENT & INSTRUMENTS - 0.9%
117,400 Itron, Inc.* ................................... 2,807,034
--------------

TOTAL COMMON STOCKS ............................ 315,005,574
--------------
(Cost $256,596,755)

TOTAL INVESTMENTS - 99.8% ...................... 315,005,574
(Cost $256,596,755)**

NET OTHER ASSETS & LIABILITIES - 0.2% .......... 626,137
--------------
NET ASSETS - 100.0% ............................ $ 315,631,711
==============

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* Non-income producing security.
** Aggregate cost is the same for federal tax and financial reporting
purposes.

Page 8 See Notes to Financial Statements.

FIRST TRUST VALUE LINE(R) 100 FUND
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 2004

ASSETS:
Investments, at value
(Cost $256,596,755) ............................................................................. $315,005,574
Cash ............................................................................................... 904,634
Dividends receivable ............................................................................... 115,341
Interest receivable ................................................................................ 1,659
Prepaid expenses ................................................................................... 7,351
-------------
Total Assets .................................................................................. 316,034,559
-------------

LIABILITIES:
Investment advisory fee payable .................................................................... 173,489
Value Line(R)licensing fee payable ................................................................. 76,581
Printing fees payable .............................................................................. 62,685
Audit fees payable ................................................................................. 31,250
Payable to administrator ........................................................................... 24,740
Legal fees payable ................................................................................. 21,998
Accrued expenses and other payables ................................................................ 12,105
-------------
Total Liabilities ............................................................................. 402,848
-------------

NET ASSETS ......................................................................................... $315,631,711
=============
----------------------------------------------------------------
NET ASSETS CONSIST OF:
Accumulated net realized gain on investments sold .................................................. $ 7,196,940
Net unrealized appreciation of investments ......................................................... 58,408,819
Par value .......................................................................................... 174,900
Paid-in capital .................................................................................... 249,851,052
-------------
Net Assets .................................................................................... $315,631,711
=============
NET ASSET VALUE, per Common Share (par value $0.01 per Common Share) ............................... $ 18.05
=============
Number of Common Shares outstanding (unlimited number of Common Shares has been authorized) ........ 17,490,000
=============

See Notes to Financial Statements. Page 9

FIRST TRUST VALUE LINE(R) 100 FUND
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 2004

INVESTMENT INCOME:
Dividends ................................................................................... $ 1,319,247
Interest .................................................................................... 12,235
-------------
Total investment income ..................................................................... 1,331,482
-------------

EXPENSES:
Investment advisory fee ..................................................................... 1,903,837
Value Line(R)licensing fee .................................................................. 297,247
Administration fee .......................................................................... 274,318
Printing fees ............................................................................... 137,575
Audit fees .................................................................................. 29,926
Legal fees .................................................................................. 25,247
Trustees' fees and expenses ................................................................. 52,342
Custodian fees .............................................................................. 42,885
Transfer Agent fees ......................................................................... 29,988
Other ....................................................................................... 56,735
-------------
Total expenses ......................................................................... 2,850,100
-------------
NET INVESTMENT LOSS ......................................................................... (1,518,618)
-------------

NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain from investments sold during the period ................................... 15,534,767
Net change in unrealized appreciation/(depreciation) of investments during the period ....... 22,694,106
-------------
Net realized and unrealized gain on investments ............................................. 38,228,873
-------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS ........................................ $ 36,710,255
=============

Page 10 See Notes to Financial Statements.

FIRST TRUST VALUE LINE(R) 100 FUND
STATEMENTS OF CHANGES IN NET ASSETS

YEAR PERIOD
ENDED ENDED
12/31/2004 12/31/2003*
------------- -------------

Net investment loss ................................................................ $ (1,518,618) $ (1,085,058)
Net realized gain from investments sold during the period .......................... 15,534,767 5,809,249
Change in unrealized appreciation/(depreciation) of investments during the period .. 22,694,106 35,714,713
------------ -------------
Net increase in net assets resulting from operations ............................... 36,710,255 40,438,904

DISTRIBUTIONS TO SHAREHOLDERS:
Net realized gains ................................................................. (11,543,400) --
------------ -------------
Total distributions to shareholders. ............................................... (11,543,400) --

CAPITAL TRANSACTIONS:
Gross proceeds from sale of 17,490,000 Common Shares ............................... -- 250,544,260
Offering costs ..................................................................... 1,161 (519,469)
------------ -------------
Net increase from capital transactions ............................................. 1,161 250,024,791
------------ -------------
Net increase in net assets for the period .......................................... 25,168,016 290,463,695

NET ASSETS:
Beginning of period ................................................................ 290,463,695 --
------------ -------------
End of period ...................................................................... $315,631,711 $ 290,463,695
============ =============
Undistributed net investment income end of period .................................. $ -- $ --
============ =============

--------------------------------------------------
* The Fund commenced operations on June 12, 2003.

See Notes to Financial Statements. Page 11

FIRST TRUST VALUE LINE(R) 100 FUND
FINANCIAL HIGHLIGHTS
FOR A COMMON SHARE OUTSTANDING THROUGHOUT EACH PERIOD.

YEAR PERIOD
ENDED ENDED
12/31/2004 12/31/2003*
------------- -------------

Net asset value, beginning of period .............................................. $ 16.61 $ 14.33
------------ -----------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss ............................................................... (0.09) (0.06)
Net realized and unrealized gain on investments ................................... 2.19 2.37
------------ -----------
Total from investment operations .................................................. 2.10 2.31
------------ -----------
Common shares offering costs charged to paid-in capital ........................... 0.00# (0.03)
------------ -----------
DISTRIBUTIONS PAID TO SHAREHOLDERS FROM:
Net realized gains ................................................................ (0.66) --
------------ -----------
Total from Distributions .......................................................... (0.66) --
------------ -----------
Net asset value, end of period .................................................... $ 18.05 $ 16.61
============ ===========
Market value, end of period ....................................................... $ 17.10 $ 16.49
============ ===========
TOTAL RETURN BASED ON NET ASSET VALUE (A)+ ........................................ 13.05% 15.91%
============ ===========
TOTAL RETURN BASED ON MARKET VALUE (B)+ ........................................... 7.88% 9.93%
============ ===========

RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA:
Net assets, end of period (in 000's) .............................................. $ 315,632 $ 290,464
Ratio of operating expenses to average net assets ................................. 0.97% 1.02%**
Ratio of net investment loss to average net assets ................................ (0.52)% (0.75%)**
Portfolio turnover rate ........................................................... 220.04% 143.53%

--------------------------------------------------
* The Fund commenced operations on June 12, 2003.
** Annualized.
# Amount represents less than $0.01 per share.
(a) Total return based on net asset value is the combination of reinvested
dividend income and reinvested capital gains distributions, at prices
obtained by the Dividend Reinvestment Plan, and changes in net asset value
per share and does not reflect sales load.
(b) Total return based on market value is the combination of reinvested
dividend income and reinvested capital gains distributions, at prices
obtained by the Dividend Reinvestment Plan, and changes in Common Share
price per share, all based on market price per share.
+ Total return is not annualized for periods less than one year.

Page 12 See Notes to Financial Statements.

--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
--------------------------------------------------------------------------------
FIRST TRUST VALUE LINE(R) 100 FUND
DECEMBER 31, 2004

1. FUND DESCRIPTION

First Trust Value Line(R) 100 Fund (the "Fund") is a diversified closed-end
management investment company organized as a Massachusetts business trust on
April 18, 2003 and is registered with the Securities and Exchange Commission
("SEC") under the Investment Company Act of 1940, as amended (the "1940 Act").

The Fund's investment objective is to provide capital appreciation. The Fund
seeks to outperform the Standard & Poor's 500 Composite Stock Price Index (the
"S&P 500 Index") by adhering to a disciplined strategy of investing in a
diversified portfolio of the 100 common stocks ranked #1 in Value Line's(R)
Timeliness(TM) Ranking System. There can be no assurance that the Fund's
investment objective will be achieved.

The Value Line(R) Timeliness(TM) Ranking System was introduced in its present
form in 1965. Each week, Value Line(R) Publishing, Inc. ("Value Line(R)")
screens a wide array of data, using a series of proprietary calculations to rank
each of the approximately 1,700 stocks in the Value Line(R) universe from #1
(highest) to #5 (lowest) based on their expected price performance relative to
the other stocks in the universe over the following 6 to 12 months. At any one
time, only 100 stocks are ranked #1 in the Value Line(R) Timeliness(TM) Ranking
System.

The Fund invests substantially all, but in no event less than 80%, of its net
assets in the stocks that are ranked #1 in the Value Line(R) Timeliness(TM)
Ranking System. Each week, the Fund will make portfolio adjustments to match the
changes made to the #1 ranked stocks by Value Line(R). The Fund also rebalances
its holdings on a quarterly basis so that each stock is equally weighted on the
rebalancing date.

2. SIGNIFICANT ACCOUNTING POLICIES

The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. The
preparation of financial statements in accordance with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts and disclosures in
the financial statements. Actual results could differ from those estimates.

PORTFOLIO VALUATION:

The Fund determines the net asset value ("NAV") of its shares daily, as of the
close of regular session trading on the New York Stock Exchange ("NYSE"),
normally 4:00 p.m. Eastern time on each day the NYSE is open for trading. The
NAV is computed by dividing the value of all assets of the Fund (including
accrued interest and dividends), less all liabilities (including accrued
expenses and dividends declared but unpaid), by the total number of shares
outstanding.

The Fund's investments are valued at market value or, in the absence of market
value with respect to any portfolio securities, at fair value according to
procedures adopted by the Fund's Board of Trustees. Portfolio securities listed
on any exchange other than the NASDAQ National Market ("NASDAQ") are valued at
the last sale price on the business day on which such value is being determined.
If there has been no sale on such day, the securities are valued at the mean of
the most recent bid and asked prices on such day. Securities traded on the
NASDAQ are valued at the NASDAQ Official Closing Price as determined by NASDAQ.
Portfolio securities traded on more than one securities exchange are valued at
the last sale price on the business day as of which such value is being
determined at the close of the exchange representing the principal market for
such securities. Portfolio securities traded in the over-the-counter market, but
excluding securities trading on the NASDAQ, are valued at the closing bid
prices. Short-term investments that mature in 60 days or less are valued at
amortized cost.

SECURITIES TRANSACTIONS AND INVESTMENT INCOME:

Securities transactions are recorded as of the trade date. Realized gains and
losses from securities transactions are recorded on the identified cost basis.
Dividend income is recorded on the ex-dividend date. Interest income is recorded
on the accrual basis.

DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS:

Dividends from net investment income and net realized long-term and short-term
capital gains of the Fund will be paid at least annually or as the Board of
Trustees may determine from time to time. Distributions will automatically be
reinvested into additional Common Shares pursuant to the Fund's Dividend
Reinvestment Plan unless cash distributions are elected by the shareholder.

Distributions from income and capital gains are determined in accordance with
the income tax regulations, which may differ from accounting principles
generally accepted in the United States of America. These differences are
primarily due to differing treatments of income and gains on various investment
securities held by the Fund, timing differences and differing characterization
of distributions

Page 13

--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS - (CONTINUED)
--------------------------------------------------------------------------------
FIRST TRUST VALUE LINE(R) 100 FUND
DECEMBER 31, 2004

made by the Fund. Permanent differences incurred during the period ended
December 31, 2004, resulting in book and tax accounting differences have been
reclassified at year end to reflect a decrease to accumulated net investment
loss by $1,518,618 and a decrease to net realized gains by $1,518,618. Net
assets were not affected by this reclassification.

The tax character of distributions paid during 2004 and 2003 was as follows:

Distributions paid from:

2004 2003
---- ----

Ordinary Income ............................... $ 7,345,800 $ --
Long-term Capital Gains........................ $ 4,197,600 $ --

As of December 31, 2004, the components of distributable earnings on a tax basis
were as follows:

Ordinary Income................................ $ 5,484,786
Undistributed Long-Term Gain................... $ 1,712,154
Unrealized Appreciation........................ $ 58,408,819

INCOME TAXES:

The Fund intends to continue to qualify as a regulated investment company by
complying with the requirements under Subchapter M of the Internal Revenue Code
of 1986, as amended, and by distributing substantially all of its net investment
income and net realized gains to shareholders. Accordingly, no provision has
been made for federal or state income taxes.

EXPENSES:

The Fund pays all expenses directly related to its operations. First Trust
Advisors L.P. ("First Trust") has entered into a non-exclusive license agreement
with Value Line(R) Publishing, Inc. which allows for the use by First Trust of
the Value Line(R) Timeliness(TM) Ranking System and certain trademarks and trade
names of Value Line(R) Publishing, Inc. The Fund is a sub-licensee to this
license agreement. In exchange, Value Line(R) Publishing, Inc. receives an
annual fee, payable on a quarterly basis, equal to 10 basis points of the Fund's
average gross daily assets during such calendar quarter. This license fee will
be paid by the Fund to First Trust who will in turn pay Value Line(R)
Publishing, Inc. The terms of the license agreement provide that it shall
continue in effect for a term of one year and will be automatically renewed for
successive one year terms unless either party elects not to renew the agreement.

ORGANIZATIONAL AND OFFERING COSTS:

Organization costs consist of costs incurred to establish the Fund and enable it
to legally do business. These costs include listing fees, legal services
pertaining to the organization of the business and audit fees relating to the
initial registration and auditing the initial statement of assets and
liabilities among other fees. Offering costs consist of legal fees pertaining to
the Fund's shares offered for sale, registration fees, underwriting fees, and
printing of the initial prospectus, among other fees, First Trust has paid all
organizational expenses. The Fund's share of Common Share offering costs,
$519,469, was recorded as a reduction of the proceeds from the sale of Common
Shares.

During the year ended December 31, 2004, it was determined that actual offering
costs from the initial public offering of the Fund's Common Shares in June 2003
were less than the estimated 2003 offering costs by $1,161. Therefore, paid-in
capital in excess of par value of Common Shares has been increased by this
amount.

Page 14

3. INVESTMENT ADVISORY FEE AND OTHER AFFILIATED TRANSACTIONS

First Trust is a limited partnership with one limited partner, Grace Partners of
DuPage L.P., and one general partner, The Charger Corporation. First Trust
serves as investment advisor to the Fund pursuant to an Investment Management
Agreement. First Trust is responsible for implementing the Fund's overall
investment strategy, including the allocation and periodic reallocation of the
portion of the Fund's assets to be invested in common stocks, and certain
administrative services necessary for the management of the Fund. For these
services, First Trust is entitled to a monthly fee calculated at an annual rate
of 0.65% of the Fund's average daily net assets.

PFPC Inc. ("PFPC"), an indirect, majority-owned subsidiary of The PNC Financial
Services Group Inc., serves as the Fund's Administrator and Transfer Agent in
accordance with certain fee arrangements. PFPC Trust Company, an indirect,
majority-owned subsidiary of The PNC Financial Services Group Inc., serves as
the Fund's Custodian in accordance with certain fee arrangements.

Effective June 7, 2004, the Trustees of the Fund approved a revised compensation
plan. Under the revised plan, the Fund pays each Trustee who is not an officer
or employee of First Trust or any of its affiliates an annual retainer of
$10,000, which includes compensation for all regular quarterly board meetings
and regular committee meetings. No additional meeting fees are paid in
connection with regular quarterly board meetings or regular committee meetings.
Additional fees of $1,000 and $500 are paid to non-interested Trustees for
special board meetings and non-regular committee meetings, respectively. These
additional fees are shared by the funds in the First Trust fund complex that
participate in the particular meeting and are not per fund fees. Trustees are
also reimbursed for travel and out-of-pocket expenses in connection with all
meetings. The Trustees adopted the revised plan because the increase in the
number of funds in the First Trust complex had the effect of rapidly increasing
their compensation under the previous arrangements. Prior to June 7, 2004, the
Fund paid each Trustee who was not an officer or employee of First Trust or any
of its affiliates $10,000 per annum plus $1,000 per regularly scheduled meeting
attended, $500 per committee meeting attended and reimbursement for travel and
out-of-pocket expenses.

4. PURCHASES AND SALES OF SECURITIES

Cost of purchases and proceeds from sales of investment securities, excluding
short-term investments, for the year ended December 31, 2004, aggregated amounts
were $646,239,816 and $659,217,584, respectively.

As of December 31, 2004, the aggregate gross unrealized appreciation for all
securities, in which there was an excess of value over tax cost, was $60,126,666
and the aggregate gross unrealized depreciation for all securities, in which
there was an excess of tax cost over value, was $1,717,847.

Page 15

--------------------------------------------------------------------------------
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
--------------------------------------------------------------------------------

TO THE BOARD OF TRUSTEES AND SHAREHOLDERS OF FIRST TRUST VALUE LINE(R)100 FUND:

We have audited the accompanying statement of assets and liabilities of First
Trust Value Line(R) 100 Fund (the "Fund"), including the portfolio of
investments, as of December 31, 2004, the related statement of operations for
the year then ended, and the statements of changes in net assets and the
financial highlights for each of the periods in the two year period then ended.
These financial statements and financial highlights are the responsibility of
the 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.
An audit includes 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 Fund's 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 as of
December 31, 2004, by correspondence with the Fund's custodian. 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 First
Trust Value Line(R) 100 Fund at December 31, 2004, the results of its operations
for the year then ended, and its changes in its net assets and financial
highlights for each of the periods in the two year period then ended, in
conformity with accounting principles generally accepted in the United States of
America.

[GRAPHIC OMITTED]

DELOITTE AND TOUCHE LLP LOGO

Chicago, Illinois
February 17, 2005

Page 16

--------------------------------------------------------------------------------
ADDITIONAL INFORMATION (UNAUDITED)
--------------------------------------------------------------------------------
FIRST TRUST VALUE LINE(R) 100 FUND
DECEMBER 31, 2004

DIVIDEND REINVESTMENT PLAN

If your Common Shares are registered directly with the Fund or if you hold your
Common Shares with a brokerage firm that participates in the Fund's Dividend
Reinvestment Plan (the "Plan"), unless you elect to receive cash distributions,
all dividends and distributions on your Common Shares will be automatically
reinvested by PFPC Inc. (the "Plan Agent") in additional Common Shares under the
Plan. If you elect to receive cash distributions, you will receive all
distributions in cash paid by check mailed directly to you by the Plan Agent.

If you decide to participate in the Plan, the number of Common Shares you will
receive will be determined as follows:

(1) If the Common Shares are trading at or above net asset value at the
time of valuation, the Fund will issue new shares at a price equal to
the greater of (i) net asset value per Common Share on that date or
(ii) 95% of the market price on that date.

(2) If Common Shares are trading below net asset value at the time of
valuation, the Plan Agent will receive the dividend or distribution in
cash and will purchase Common Shares in the open market, on the
American Stock Exchange or elsewhere, for the participants' accounts.
It is possible that the market price for the Common Shares may
increase before the Plan Agent has completed its purchases. Therefore,
the average purchase price per share paid by the Plan Agent may exceed
the market price at the time of valuation, resulting in the purchase
of fewer shares than if the dividend or distribution had been paid in
Common Shares issued by the Fund. The Plan Agent will use all
dividends and distributions received in cash to purchase Common Shares
in the open market within 30 days of the valuation date except where
temporary curtailment or suspension of purchases is necessary to
comply with federal securities laws. Interest will not be paid on any
uninvested cash payments.

You may withdraw from the Plan at any time by giving written notice to the Plan
Agent, or by telephone in accordance with such reasonable requirements as the
Plan Agent and Fund may agree upon. If you withdraw or the Plan is terminated,
you will receive a certificate for each whole share in your account under the
Plan and you will receive a cash payment for any fraction of a share in your
account. If you wish, the Plan Agent will sell your shares and send you the
proceeds, minus brokerage commissions.

The Plan Agent maintains all shareholders' accounts in the Plan and gives
written confirmation of all transactions in the accounts, including information
you may need for tax records. Common Shares in your account will be held by the
Plan Agent in non-certificated form. The Plan Agent will forward to each
participant any proxy solicitation material and will vote any shares so held
only in accordance with proxies returned to the Fund. Any proxy you receive will
include all Common Shares you have received under the Plan.

There is no brokerage charge for reinvestment of your dividends or distributions
in Common Shares. However, all participants will pay a pro rata share of
brokerage commissions incurred by the Plan Agent when it makes open market
purchases.

Automatically reinvesting dividends and distributions does not mean that you do
not have to pay income taxes due upon receiving dividends and distributions.
Capital gains and income are realized, although cash is not received by you.

If you hold your Common Shares with a brokerage firm that does not participate
in the Plan, you will not be able to participate in the Plan and any dividend
reinvestment may be effected on different terms than those described above.
Consult your financial advisor for more information.

The Fund reserves the right to amend or terminate the Plan if in the judgment of
the Board of Trustees the change is warranted. There is no direct service charge
to participants in the Plan; however, the Fund reserves the right to amend the
Plan to include a service charge payable by the participants. Additional
information about the Plan may be obtained by writing PFPC Inc., 301 Bellevue
Parkway, Wilmington, Delaware 19809.

Page 17

--------------------------------------------------------------------------------
ADDITIONAL INFORMATION - (CONTINUED)
--------------------------------------------------------------------------------
FIRST TRUST VALUE LINE(R) 100 FUND
DECEMBER 31, 2004

--------------------------------------------------------------------------------
PROXY VOTING POLICIES AND PROCEDURES

A description of the policies and procedures that the Fund uses to determine how
to vote proxies and information how the Fund voted proxies relating to portfolio
holdings is available (1) without charge, upon request, by calling (800)
988-5891; (2) on the Fund's website located at http://www.ftportfolios.com; and
(3) on the Securities and Exchange Commission's website located at
http://www.sec.gov.

PORTFOLIO HOLDINGS

The Fund files its complete schedule of portfolio holdings with the Securities
and Exchange Commission ("SEC") for the first and third quarters of each fiscal
year on Form N-Q. The Fund's Form N-Q is available (1) by calling (800)
988-5891; (2) on the Fund's website located at http://www.ftportfolios.com; (3)
on the SEC's website at http://www.sec.gov; and (4) for review and copying at
the SEC's Public Reference Room ("PRR") in Washington, DC. Information regarding
the operation of the PRR may be obtained by calling 1-800-SEC-0330.

TAX INFORMATION

Of the ordinary income (including short-term capital gain) distributions made by
the Fund during the year ended December 31, 2004, 10.80% qualify for the
corporate dividend received deduction available to corporate shareholders.

The Fund hereby designates as qualified dividend income distributions 17.12% of
the ordinary income (including short-term capital gain), for the year ended
December 31, 2004.

For the year ended December 31, 2004, the amount of long-term capital gain
designated by the Fund was $4,197,600, which is taxable as a 15% rate gain for
Federal income tax purposes.

SUBMISSION OF MATTERS TO A VOTE OF SHAREHOLDERS

The Annual Meeting of Shareholders of the Fund was held on April 19, 2004. At
the Annual Meeting, the Fund's Board of Trustees, consisting of James A. Bowen,
Niel B. Nielson, Thomas R. Kadlec, Richard E. Erickson and David M. Oster, was
elected to serve an additional one year term. The number of votes cast for each
Trustee was 14,150,919, the number of votes withheld for each Trustee was 59,463
and the number of abstentions was 3,279,618.

Page 18

--------------------------------------------------------------------------------
MANAGEMENT (UNAUDITED)
--------------------------------------------------------------------------------
FIRST TRUST VALUE LINE(R) 100 FUND
DECEMBER 31, 2004

BOARD OF TRUSTEES AND OFFICERS

Information pertaining to the Trustees and officers* of the Fund is set forth
below. The Statement of Additional Information (SAI) includes additional
information about the Trustees and is available without charge, upon request, by
calling (800) 988-5891.

NUMBER OF OTHER
PORTFOLIOS TRUSTEESHIPS/
NAME, D.O.B., ADDRESS AND TERM OF OFFICE AND PRINCIPAL OCCUPATION(S) IN FUND COMPLEX DIRECTORSHIPS
POSITION(S) WITH THE FUND LENGTH OF TIME SERVED DURING PAST 5 YEARS OVERSEEN BY TRUSTEE HELD BY TRUSTEE
------------------------------------------------------------------------------------------------------------------------------------
DISINTERESTED TRUSTEES
------------------------------------------------------------------------------------------------------------------------------------

Richard E. Erickson, Trustee o One year term Physician, Sportsmed/ 20 portfolios None
D.O.B. 04/51 o 19 months served Wheaton Orthopedics
c/o First Trust Advisors L.P.
1001 Warrenville Road
Suite 300
Lisle, IL 60532

Niel B. Nielson, Trustee o One year term President, Covenant 20 portfolios Director of Good
D.O.B. 03/54 o 19 months served College (June 2002 to News Publisher-
c/o First Trust Advisors L.P. present); Pastor, College Crossway Books;
1001 Warrenville Road Church in Wheaton Covenant Transport
Suite 300 (1997 to June 2002) Inc.
Lisle, IL 60532

Thomas R. Kadlec o One year term Vice President and Chief 20 portfolios None
D.O.B. 11/57 o 19 months served Financial Officer (1990
c/o First Trust Advisors L.P. to present) ADM
1001 Warrenville Road Investor Services, Inc.
Suite 300 (Futures Commission
Lisle, IL 60532 Merchant); Registered
Representative (2000 to
present) Segerdahl &
Company, Inc., a NASD
member (Broker-Dealer)

David M. Oster o One year term Trader and Market 9 portfolios None
D.O.B. 03/64 o 19 months served Maker, Chicago Options
c/o First Trust Advisors L.P. Exchange (Self
1001 Warrenville Road Employed-1987 to
Suite 300 present in options
Lisle, IL 60532 trading and market
making)

Page 19

--------------------------------------------------------------------------------
MANAGEMENT - (CONTINUED)
--------------------------------------------------------------------------------
FIRST TRUST VALUE LINE(R) 100 FUND
DECEMBER 31, 2004

BOARD OF TRUSTEES AND OFFICERS (CONTINUED)

NUMBER OF OTHER
PORTFOLIOS TRUSTEESHIPS/
NAME, D.O.B., ADDRESS AND TERM OF OFFICE AND PRINCIPAL OCCUPATION(S) IN FUND COMPLEX DIRECTORSHIPS
POSITION(S) WITH THE FUND LENGTH OF TIME SERVED DURING PAST 5 YEARS OVERSEEN BY TRUSTEE HELD BY TRUSTEE
------------------------------------------------------------------------------------------------------------------------------------
INTERESTED TRUSTEE
------------------------------------------------------------------------------------------------------------------------------------

James A. Bowen, Trustee o One year Trustee President, First Trust 20 portfolios None
President, Chairman of the term and indefinite Advisors L.P. and First
Board and CEO officer term Trust Portfolios L.P.;
D.O.B. 09/55 o 19 months served Chairman of the Board,
1001 Warrenville Road BondWave LLC and
Suite 300 Stonebridge Advisors
Lisle, IL 60532 LLC

------------------------------------------------------------------------------------------------------------------------------------
OFFICERS WHO ARE NOT TRUSTEES
------------------------------------------------------------------------------------------------------------------------------------
Robert F. Carey, Vice o Indefinite term Senior Vice President, N/A N/A
President o 19 months served First Trust Advisors L.P.
D.O.B. 07/63 and First Trust
1001 Warrenville Road Portfolios L.P.
Suite 300
Lisle, IL 60532

Mark R. Bradley, Treasurer, o Indefinite term Chief Financial Officer, N/A N/A
Controller, Chief Financial o 19 months served Managing Director, First
Officer, Chief Accounting Trust Advisors L.P. and
Officer First Trust Portfolios
D.O.B. 11/57 L.P.; Chief Financial
1001 Warrenville Road Officer, BondWave LLC
Suite 300 and Stonebridge
Lisle, IL 60532 Advisors LLC

W. Scott Jardine, Secretary o Indefinite term General Counsel, First N/A N/A
and Chief Compliance Officer o 19 months served Trust Advisors L.P. and
D.O.B. 05/60 First Trust Portfolios
1001 Warrenville Road L.P.; Secretary,
Suite 300 BondWave LLC and
Lisle, IL 60532 Stonebridge Advisors
LLC

Page 20

BOARD OF TRUSTEES AND OFFICERS (CONTINUED)

NUMBER OF OTHER
PORTFOLIOS TRUSTEESHIPS/
NAME, D.O.B., ADDRESS AND TERM OF OFFICE AND PRINCIPAL OCCUPATION(S) IN FUND COMPLEX DIRECTORSHIPS
POSITION(S) WITH THE FUND LENGTH OF TIME SERVED DURING PAST 5 YEARS OVERSEEN BY TRUSTEE HELD BY TRUSTEE
------------------------------------------------------------------------------------------------------------------------------------
OFFICERS WHO ARE NOT TRUSTEES - (CONTINUED)
------------------------------------------------------------------------------------------------------------------------------------

Roger Testin o Indefinite term Senior Vice President, N/A N/A
Vice President o 19 months served First Trust Advisors L.P.
D.O.B. 06/66 (August 2001 to
1001 Warrenville Road present); Analyst, Dolan
Suite 300 Capital Management
Lisle, IL 60532 (1998-2001)

Susan M. Brix o Indefinite term Representative, First N/A N/A
Assistant Vice President o 19 months served Trust Portfolios L.P.;
D.O.B. 01/60 Assistant Portfolio
1001 Warrenville Road Manager, First Trust
Suite 300 Advisors L.P.
Lisle, IL 60532

Kristi A. Maher o Indefinite term Assistant General N/A N/A
Assistant Secretary o 7 months served Counsel, First Trust
D.O.B. 12/66 Portfolios L.P. (March
1001 Warrenville Road 2004 to present);
Suite 300 Associate, Chapman and
Lisle, IL 60532 Cutler LLP (1995-2004)

-----------------
* The term "officer" means the president, vice president, secretary,
treasurer, controller or any other officer who performs a policy making
function.

Page 21

ITEM 2. CODE OF ETHICS.

(a) The registrant, as of the end of the period covered by this report, has
adopted a code of ethics that applies to the registrant's principal
executive officer, principal financial officer, principal accounting
officer or controller, or persons performing similar functions,
regardless of whether these individuals are employed by the registrant
or a third party.

(c) There have been no amendments, during the period covered by this
report, to a provision of the code of ethics that applies to the
registrant's principal executive officer, principal financial officer,
principal accounting officer or controller, or persons performing
similar functions, regardless of whether these individuals are employed
by the registrant or a third party, and that relates to any element of
the code of ethics definition enumerated in paragraph (b) of this Item.

(d) The registrant has not granted any waivers, including an implicit
waiver, from a provision of the code of ethics that applies to the
registrant's principal executive officer, principal financial officer,
principal accounting officer or controller, or persons performing
similar functions, regardless of whether these individuals are employed
by the registrant or a third party, that relates to one or more of the
items set forth in paragraph (b) of this Item.

ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.

As of the end of the period covered by the report, the registrant's board of
trustees has determined that Thomas R. Kadlec is qualified to serve as an audit
committee financial expert serving on its audit committee and that he is
"independent," as defined by Item 3 of Form N-CSR.

ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

(a) AUDIT FEES (REGISTRANT) -- The aggregate fees billed for the Fund's
last two fiscal years (from inception on June 12, 2003 to December 31, 2004) for
professional services rendered by the principal accountant for the audit of the
registrant's annual financial statements or services that are normally provided
by the accountant in connection with statutory and regulatory filings or
engagements for such last two fiscal years are $27,677 for 2003 and $9,000 for
2004.

(b) AUDIT-RELATED FEES (REGISTRANT) -- The aggregate fees billed in the
Fund's last two fiscal years (from inception on June 12, 2003 to December 31,
2004) for assurance and related services by the principal accountant that are
reasonably related to the performance of the audit of the registrant's financial
statements and are not reported under paragraph (a) of this Item are $ 0.

AUDIT-RELATED FEES (INVESTMENT ADVISER) -- The aggregate fees
billed in the last two fiscal years (of the Registrant) for assurance and
related services by the principal accountant that are reasonably related to the
performance of the audit of the adviser's registration statements and are not
reported under paragraph (a) of this Item are $ 20,400 for 2003 and $0 for 2004.
The fees were for AIMR Verification.

(c) TAX FEES (REGISTRANT) -- The aggregate fees billed in the last two
fiscal years (from inception on June 12, 2003 to December 31, 2004) for
professional services rendered by the principal accountant for tax compliance,
tax advice, and tax planning to the registrant are $0.

TAX FEES (INVESTMENT ADVISER) -- The aggregate fees billed in
the last two fiscal years (of the Registrant) for professional services rendered
by the principal accountant for tax compliance, tax advice, and tax planning to
the Fund's adviser are $ 6,000 for 2003 and $6,000 for 2004. The fees are for
tax return preparation.

(d) ALL OTHER FEES (REGISTRANT) -- The aggregate fees billed in the
last two fiscal years (from inception on June 12, 2003 to December 31, 2004) for
products and services provided by the principal accountant to the registrant,
other than the services reported in paragraphs (a) through (c) of this Item, are
$ 0.

ALL OTHER FEES (INVESTMENT ADVISER) -- The aggregate fees billed
in the last two fiscal years (of the Registrant) for products and services
provided by the principal accountant to the registrant's investment adviser,
other than services reported in paragraphs (a) through (c) of this Item, are $
0.

(e)(1) Disclose the audit committee's pre-approval policies and procedures
described in paragraph (c)(7) of Rule 2-01 of Regulation S-X.

Pursuant to its charter, the Audit Committee (the "COMMITTEE") is
responsible for the pre-approval of all audit services and permitted non-audit
services (including the fees and terms thereof) to be performed for the Fund by
its independent auditors. The Chairman of the Committee is authorized to give
such pre-approvals on behalf of the Committee and shall report any such
pre-approval to the full Committee.

The Committee is also responsible for the approval of the independent
auditor's engagements for non-audit services with the Fund's management (not
including a sub-adviser whose role is primarily portfolio management and is
sub-contracted or overseen by another investment adviser) and any entity
controlling, controlled by or under common control with the investment adviser
that provides ongoing services to the Fund, if the engagement relates directly
to the operations and financial reporting of the Fund, subject to the DE MINIMIS
exceptions for non-audit services described in Rule 2-01 of Regulation S-X. If
the independent auditor has provided non-audit services to the Fund's management
(other than any sub-adviser whose role is primarily portfolio management and is
sub-contracted with or overseen by another investment adviser) and any entity
controlling, controlled by or under common control with the investment adviser
that provides ongoing services to the Fund that were not pre-approved pursuant
to the DE MINIMIS exception, the Committee will consider whether the provision
of such non-audit services is compatible with the auditor's independence.

(e)(2) The percentage of services described in each of paragraphs (b)
through (d) of this Item that were approved by the audit committee pursuant to
paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X are as follows:

(b) 0%

(d) Not applicable.

The percentage of services described in each of paragraphs (b) through (d) of
this Item that were approved by the audit committee pursuant to paragraph
(c)(7)(ii) of Rule 2-01 of Regulation S-X are as follows:

(b) 100%.

(d) Not applicable.

(f) The percentage of hours expended on the principal accountant's
engagement to audit the registrant's financial statements for the most recent
fiscal year that were attributed to work performed by persons other than the
principal accountant's full-time, permanent employees was less than fifty
percent.

(g) The aggregate non-audit fees billed by the registrant's accountant
for services rendered to the registrant, and rendered to the registrant's
investment adviser (not including any sub-adviser whose role is primarily
portfolio management and is subcontracted with or overseen by another investment
adviser), and any entity controlling, controlled by, or under common control
with the adviser that provides ongoing services to the registrant for the last
two fiscal years of the registrant (from inception on June 12, 2003 to December
31, 2004) was $ 32,400.

(h) Not applicable. The audit committee pre-approved all non-audit
services rendered 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.

ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.

(a) The registrant has a separately designated audit committee consisting
of all the independent trustees of the registrant. The members of the
audit committee are: Thomas R. Kadlec. Niel B. Nielson, David M. Oster
and Richard E. Erickson.

ITEM 6. SCHEDULE OF INVESTMENTS

Schedule of Investments in securities of unaffiliated issuers as of the close of
the reporting period is included as part of the report to shareholders filed
under Item 1 of this form.

ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.

The Proxy Voting Policies are attached herewith.

FIRST DEFINED PORTFOLIO FUND LLC
FIRST TRUST VALUE LINE(R) 100 FUND
FIRST TRUST VALUE LINE(R) DIVIDEND FUND
FIRST TRUST/FOUR CORNERS SENIOR FLOATING RATE INCOME FUND
FIRST TRUST/VALUE LINE(R) & IBBOTSON EQUITY ALLOCATION FUND
FIRST TRUST/FOUR CORNERS SENIOR FLOATING RATE INCOME FUND II

FIRST TRUST ADVISORS, L.P.
FIRST TRUST FUNDS
PROXY VOTING GUIDELINES

First Trust Advisors, L.P. (the "ADVISER") serves as investment adviser
providing discretionary investment advisory services for several open or
closed-end investment companies (the "FUNDS"). As part of these services, the
Adviser has full responsibility for proxy voting and related duties. In
fulfilling these duties, the Adviser and Funds have adopted the following
policies and procedures:

1. It is the Adviser's policy to seek to ensure that proxies for
securities held by a Fund are voted consistently and solely in the
best economic interests of the respective Fund.

2. The Adviser shall be responsible for the oversight of a Fund's
proxy voting process and shall assign a senior member of its staff
to be responsible for this oversight.

3. The Adviser has engaged the services of Institutional Shareholder
Services, Inc. ("ISS") to make recommendations to the Adviser on
the voting of proxies related to securities held by a Fund. ISS
provides voting recommendations based on established guidelines
and practices. The Adviser has adopted these ISS Proxy Voting
Guidelines.

4. The Adviser shall review the ISS recommendations and generally
will vote the proxies in accordance with such recommendations.
Notwithstanding the foregoing, the Adviser may not vote in
accordance with the ISS recommendations if the Adviser believes
that the specific ISS recommendation is not in the best interests
of the respective Fund.

5. If the Adviser manages the assets or pension fund of a company and
any of the Adviser's clients hold any securities in that company,
the Adviser will vote proxies relating to such company's
securities in accordance with the ISS recommendations to avoid any
conflict of interest. In addition, if the Adviser has actual
knowledge of any other type of material conflict of interest
between itself and the respective Fund with respect to the voting
of a proxy, the Adviser shall vote the applicable proxy in
accordance with the ISS recommendations to avoid such conflict of
interest.

6. If a Fund requests the Adviser to follow specific voting
guidelines or additional guidelines, the Adviser shall review the
request and follow such guidelines, unless the Adviser determines
that it is unable to follow such guidelines. In such case, the
Adviser shall inform the Fund that it is not able to follow the
Fund's request.

7. The Adviser may have clients in addition to the Funds which have
provided the Adviser with discretionary authority to vote proxies
on their behalf. In such cases, the Adviser shall follow the same
policies and procedures.

Dated: September 15, 2003

APPENDIX D ISS
PROXY VOTING GUIDELINES
SUMMARY
The following is a condensed version of all proxy voting recommendations
contained in The ISS Proxy Voting Manual.

1. OPERATIONAL ITEMS

ADJOURN MEETING

Generally vote AGAINST proposals to provide management with the authority to
adjourn an annual or special meeting absent compelling reasons to support the
proposal.

AMEND QUORUM REQUIREMENTS

Vote AGAINST proposals to reduce quorum requirements for shareholder meetings
below a majority of the shares outstanding unless there are compelling reasons
to support the proposal.

AMEND MINOR BYLAWS

Vote FOR bylaw or charter changes that are of a housekeeping nature (updates or
corrections).

CHANGE COMPANY NAME

Vote FOR proposals to change the corporate name.

CHANGE DATE, TIME, OR LOCATION OF ANNUAL MEETING

Vote FOR management proposals to change the date/time/location of the annual
meeting unless the proposed change is unreasonable.

Vote AGAINST shareholder proposals to change the date/time/location of the
annual meeting unless the current scheduling or location is unreasonable.

RATIFYING AUDITORS

Vote FOR proposals to ratify auditors, unless any of the following apply:

o An auditor has a financial interest in or association with the company, and is
therefore not independent
o Fees for non-audit services are excessive, or
o There is reason to believe that the independent auditor has rendered an
opinion which is neither accurate nor indicative of the company's financial
position.

Vote CASE-BY-CASE on shareholder proposals asking companies to prohibit or limit
their auditors from engaging in non-audit services.

Vote CASE-BY-CASE on shareholder proposals asking for audit firm rotation,
taking into account the tenure of the audit firm, the length of rotation
specified in the proposal, any significant audit-related issues at the company,
and whether the company has a periodic renewal process where the auditor is
evaluated for both audit quality and competitive price.

TRANSACT OTHER BUSINESS

Vote AGAINST proposals to approve other business when it appears as a voting
item.

2. BOARD OF DIRECTORS

VOTING ON DIRECTOR NOMINEES IN UNCONTESTED ELECTIONS

Votes on director nominees should be made on a CASE-BY-CASE basis, examining the
following factors: composition of the board and key board committees, attendance
at board meetings, corporate governance provisions and takeover activity,
long-term company performance relative to a market index, directors' investment
in the company, whether the chairman is also serving as CEO, and whether a
retired CEO sits on the board.

However, there are some actions by directors that should result in votes being
WITHHELD. These instances include directors who:
o Attend less than 75 percent of the board and committee meetings without a
valid excuse
o Implement or renew a dead-hand or modified dead-hand poison pill
o Ignore a shareholder proposal that is approved by a majority of the shares
outstanding
o Ignore a shareholder proposal that is approved by a majority of the votes cast
for two consecutive years
o Failed to act on takeover offers where the majority of the shareholders
tendered their shares
o Are inside directors or affiliated outsiders and sit on the audit,
compensation, or nominating committees
o Are inside directors or affiliated outsiders and the full board serves as the
audit, compensation, or nominating committee or the company does not have one of
these committees
o Are audit committee members and the non-audit fees paid to the auditor are
excessive.
o Are inside directors or affiliated outside directors and the full
board is less than majority independent
o Sit on more than six boards
o Are members of a compensation committee that has allowed a pay-
for-performance disconnect as described in Section 8 (Executive and Director
Compensation).

In addition, directors who enacted egregious corporate governance policies or
failed to replace management as appropriate would be subject to recommendations
to WITHHOLD votes.

AGE LIMITS

Vote AGAINST shareholder or mana gement proposals to limit the tenure of outside
directors either through term limits or mandatory retirement ages.

BOARD SIZE

Vote FOR proposals seeking to fix the board size or designate a range for the
board size.

Vote AGAINST proposals that give management the ability to alter the
size of the board outside of a specified range without shareholder approval.

CLASSIFICATION/DECLASSIFICATION OF THE BOARD

Vote AGAINST proposals to classify the board.

Vote FOR proposals to repeal classified boards and to elect all directors
annually.

CUMULATIVE VOTING
Vote AGAINST proposals to eliminate cumulative voting.

Vote proposals to restore or permit cumulative voting on a CASE-BY-CASE basis
relative to the company's other governance provisions.

DIRECTOR AND OFFICER INDEMNIFICATION AND LIABILITY PROTECTION
Proposals on director and officer indemnification and liability protection
should be evaluated on a CASE-BY-CASE basis, using Delaware law as the standard.

Vote AGAINST proposals to eliminate entirely directors' and officers' liability
for monetary damages for violating the duty of care.

Vote AGAINST indemnification proposals that would expand coverage beyond just
legal expenses to actions, such as negligence, that are more serious violations
of fiduciary obligation than mere carelessness.

Vote FOR only those proposals providing such expanded coverage in cases when a
director's or officer's legal defense was unsuccessful if both of the following
apply:
o The director was found to have acted in good faith and in a manner that he
reasonably believed was in the best interests of the company, and
o Only if the director's legal expenses would be covered.

ESTABLISH/AMEND NOMINEE QUALIFICATIONS

Vote CASE-BY-CASE on proposals that establish or amend director qualifications.
Votes should be based on how reasonable the criteria are and to what degree they
may preclude dissident nominees from joining the board.

Vote AGAINST shareholder proposals requiring two candidates per board seat.

FILLING VACANCIES/REMOVAL OF DIRECTORS

Vote AGAINST proposals that provide that directors may be removed only for
cause.

Vote FOR proposals to restore shareholder ability to remove directors with or
without cause.

Vote AGAINST proposals that provide that only continuing directors may elect
replacements to fill board vacancies.

Vote FOR proposals that permit shareholders to elect directors to fill board
vacancies.

INDEPENDENT CHAIRMAN (SEPARATE CHAIRMAN/CEO)

Generally vote FOR shareholder proposals requiring the position of chairman be
filled by an independent director unless there are compelling reasons to
recommend against the proposal, such as a counterbalancing governance structure.
This should include all of the following:
o Designated lead director, elected by and from the independent board members
with clearly delineated and comprehensive duties
o Two-thirds independent board
o All-independent key committees
o Established governance guidelines

MAJORITY OF INDEPENDENT DIRECTORS/ESTABLISHMENT OF COMMITTEES

Vote FOR shareholder proposals asking that a majority or more of directors be
independent unless the board composition already meets the proposed threshold by
ISS's definition of independence.

Vote FOR shareholder proposals asking that board audit, compensation, and/or
nominating committees be composed exclusively of independent directors if they
currently do not meet that standard.

OPEN ACCESS

Vote CASE-BY-CASE on shareholder proposals asking for open access taking into
account the ownership threshold specified in the proposal and the proponent's
rationale for targeting the company in terms of board and director conduct.

STOCK OWNERSHIP REQUIREMENTS

Generally vote AGAINST shareholder proposals that mandate a minimum amount of
stock that directors must own in order to qualify as a director or to remain on
the board. While ISS favors stock ownership on the part of directors, the
company should determine the appropriate ownership requirement.

Vote CASE-BY-CASE shareholder proposals asking that the company adopt a holding
or retention period for its executives (for holding stock after the vesting or
exercise of equity awards), taking into account any stock ownership requirements
or holding period/retention ratio already in place and the actual ownership leve
l of executives.

TERM LIMITS

Vote AGAINST shareholder or management proposals to limit the tenure of
outside directors either through term limits or mandatory retirement ages.

3. PROXY CONTESTS
VOTING FOR DIRECTOR NOMINEES IN CONTESTED ELECTIONS
Votes in a contested election of directors must be evaluated on a CASE-BY-CASE
basis, considering the following factors:
o Long-term financial performance of the target company relative to its industry
o Management's track record
o Background to the proxy contest
o Qualifications of director nominees (both slates)
o Evaluation of what each side is offering shareholders as well as the
likelihood that the proposed objectives and goals can be met; and stock
ownership positions.

REIMBURSING PROXY SOLICITATION EXPENSES
Voting to reimburse proxy solicitation expenses should be analyzed on a
CASE-BYCASE basis. In cases where ISS recommends in favor of the dissidents, we
also recommend voting for reimbursing proxy solicitation expenses.

CONFIDENTIAL VOTING

Vote FOR shareholder proposals requesting that corporations adopt confidential
voting, use independent vote tabulators and use independent inspectors of
election, as long as the proposal includes a provision for proxy contests as
follows:

In the case of a cont ested election, management should be permitted to request
that the dissident group honor its confidential voting policy. If the dissidents
agree, the policy remains in place. If the dissidents will not agree, the
confidential voting policy is waived.

Vote FOR management proposals to adopt confidential voting.

4. ANTITAKEOVER DEFENSES AND VOTING RELATED ISSUES

ADVANCE NOTICE REQUIREMENTS FOR SHAREHOLDER PROPOSALS/NOMINATIONS

Votes on advance notice proposals are determined on a CASE-BY-CASE basis, giving
support to those proposals that allow shareholders to submit proposals as close
to the meeting date as reasonably possible and within the broadest window
possible.

AMEND BYLAWS WITHOUT SHAREHOLDER CONSENT

Vote AGAINST proposals giving the board exclus ive authority to amend the
bylaws.

Vote FOR proposals giving the board the ability to amend the bylaws in addition
to shareholders.

POISON PILLS
Vote FOR shareholder proposals requesting that the company submit its poison
pill to a shareholder vote or redeem it.

Vote FOR shareholder proposals asking that any future pill be put to a
shareholder vote.

SHAREHOLDER ABILITY TO ACT BY WRITTEN CONSENT
Vote AGAINST proposals to restrict or prohibit shareholder ability to take
action by written consent.

Vote FOR proposals to allow or make easier shareholder action by written
consent.

SHAREHOLDER ABILITY TO CALL SPECIAL MEETINGS
Vote AGAINST proposals to restrict or prohibit shareholder ability to call
special meetings.

Vote FOR proposals that remove restrictions on the right of shareholders to act
independently of management.

SUPERMAJORITY VOTE REQUIREMENTS

Vote AGAINST proposals to require a supermajority shareholder vote.

Vote FOR proposals to lower supermajority vote requirements.

5. MERGERS AND CORPORATE RESTRUCTURINGS
APPRAISAL RIGHTS
Vote FOR proposals to restore, or provide shareholders with, rights of
appraisal.

ASSET PURCHASES

Vote CASE-BY-CASE on asset purchase proposals, considering the following
factors:
o Purchase price
o Fairness opinion
o Financial and strategic benefits
o How the deal was negotiated
o Conflicts of interest
o Other alternatives for the business
o Noncompletion risk.

ASSET SALES

Votes on asset sales should be determined on a CASE-BY-CASE basis, considering
the following factors:
o Impact on the balance sheet/working capital
o Potential elimination of diseconomies
o Anticipated financial and operating benefits
o Anticipated use of funds
o Value received for the asset
o Fairness opinion
o How the deal was negotiated
o Conflicts of interest.

BUNDLED PROPOSALS
Review on a CASE-BY-CASE basis bundled or "conditioned" proxy proposals. In the
case of items that are conditioned upon each other, examine the benefits and
costs of the packaged items. In instances when the joint effect of the
conditioned items is not in shareholders' best interests, vote against the
proposals. If the combined effect is positive, support such proposals.

CONVERSION OF SECURITIES

Votes on proposals regarding conversion of securities are determined on a
CASE-BYCASE basis. When evaluating these proposals the investor should review
the dilution to existing shareholders, the conversion price relative to market
value, financial issues, control issues, termination penalties, and conflicts of
interest.

Vote FOR the conversion if it is expected that the company will be subject to
onerous penalties or will be forced to file for bankruptcy if the transaction is
not approved.

CORPORATE REORGANIZATION/DEBT RESTRUCTURING/PREPACKAGED BANK RUPTCY
PLANS/REVERSE LEVERAGED BUYOUTS/WRAP PLANS

Votes on proposals to increase common and/or preferred shares and to issue
shares as part of a debt restructuring plan are determined on a CASE-BY-CASE
basis, taking into consideration the following:
o Dilution to existing shareholders' position o Terms of the offer
o Financial issues
o Management's efforts to pursue other alternatives
o Control issues
o Conflicts of interest.

Vote FOR the debt restructuring if it is expected that the company will file for
bankruptcy if the transaction is not approved.

FORMATION OF HOLDING COMPANY

Votes on proposals regarding the formation of a holding company should be
determined on a CASE-BY-CASE basis, taking into consideration the following:
o The reasons for the change
o Any financial or tax benefits
o Regulatory benefits
o Increases in capital structure
o Changes to the articles of incorporation or bylaws of the company.

Absent compelling financial reasons to recommend the transaction, vote AGAINST
the formation of a holding company if the transaction would include either of
the following:
o Increases in common or preferred stock in excess of the allowable maximum as
calculated by the ISS Capital Structure model
o Adverse changes in shareholder rights

GOING PRIVATE TRANSACTIONS (LBOS AND MINORITY SQUEEZEOUTS)

Vote going private transactions on a CASE-BY-CASE basis, taking into account the
following: offer price/premium, fairness opinion, how the deal was negotiated,
conflicts of interest, other alternatives/offers considered, and noncompletion
risk.

JOINT VENTURES

Votes CASE-BY-CASE on proposals to form joint ventures, taking into account the
following: percentage of assets/business contributed, percentage ownership,
financial and strategic benefits, governance structure, conflicts of interest,
other alternatives, and noncompletion risk.

LIQUIDATIONS
Votes on liquidations should be made on a CASE-BY-CASE basis after reviewing
management's efforts to pursue other alternatives, appraisal value of assets,
and the compensation plan for executives managing the liquidation.

Vote FOR the liquidation if the company will file for bankruptcy if the proposal
is not approved.

MERGERS AND ACQUISITIONS/ ISSUANCE OF SHARES TO FACILITATE MERGER OR ACQUISITION

Votes on mergers and acquisitions should be considered on a CASE-BY-CASE basis,
determining whether the transaction enhances shareholder value by giving
consideration to the following:
o Prospects of the combined company, anticipated financial and operating
benefits
o Offer price
o Fairness opinion
o How the deal was negotiated
o Changes in corporate governance
o Change in the capital structure
o Conflicts of interest.

PRIVATE PLACEMENTS/WARRANTS/CONVERTIBLE DEBENTURES

Votes on proposals regarding private placements should be determined on a
CASE-BYCASE basis. When evaluating these proposals the investor should review:
dilution to existing shareholders' position, terms of the offer, financial
issues, management's efforts to pursue other alternatives, control issues, and
conflicts of interest.

Vote FOR the private placement if it is expected that the company will file for
bankruptcy if the transaction is not approved.

SPINOFFS

Votes on spinoffs should be considered on a CASE-BY-CASE basis depending on:
o Tax and regulatory advantages
o Planned use of the sale proceeds
o Valuation of spinoff
o Fairness opinion
o Benefits to the parent company
o Conflicts of interest
o Managerial incentives

o Corporate governance changes
o Changes in the capital structure.

VALUE MAXIMIZATION PROPOSALS

Vote CASE-BY-CASE on shareholder proposals seeking to maximize shareholder value
by hiring a financial advisor to explore strategic alternatives, selling the
company or liquidating the company and distributing the proceeds to
shareholders. These proposals should be evaluated based on the following
factors: prolonged poor performance with no turnaround in sight, signs of
entrenched board and management, strategic plan in place for improving value,
likelihood of receiving reasonable value in a sale or dissolution, and whether
company is actively exploring its strategic options, including retaining a
financial advisor.

6. STATE OF INCORPORATION

CONTROL SHARE ACQUISITION PROVISIONS

Vote FOR proposals to opt out of control share acquisition statutes unless doing
so would enable the completion of a takeover that would be detrimental to
shareholders.

Vote AGAINST proposals to amend the charter to include control share acquisition
provisions.

Vote FOR proposals to restore voting rights to the control shares.

CONTROL SHARE CASHOUT PROVISIONS

Vote FOR proposals to opt out of control share cashout statutes.

DISGORGEMENT PROVISIONS

Vote FOR proposals to opt out of state disgorgement provisions.

FAIR PRICE PROVISIONS
Vote proposals to adopt fair price provisions on a CASE-BY-CASE basis,
evaluating factors such as the vote required to approve the proposed
acquisition, the vote required to repeal the fair price provision, and the
mechanism for determining the fair price.

Generally, vote AGAINST fair price provisions with shareholder
vote requirements greater than a majority of disinterested shares.

FREEZEOUT PROVISIONS

Vote FOR proposals to opt out of state freezeout provisions.

GREENMAIL
Vote FOR proposals to adopt antigreenmail charter of bylaw amendments or
otherwise restrict a company's ability to make greenmail payments.

Review on a CASE-BY-CASE basis antigreenmail proposals when they are bundled
with other charter or bylaw amendments.

REINCORPORATION PROPOSALS

Proposals to change a company's state of incorporation should be evaluated on a
CASEBY- CASE basis, giving consideration to both financial and corporate
governance concerns, including the reasons for reincorporating, a comparison of
the governance provisions, and a comparison of the jurisdictional laws.

Vote FOR reincorporation when the economic factors outweigh any neutral or
negative governance changes.

STAKEHOLDER PROVISIONS

Vote AGAINST proposals that ask the board to consider nonshareholder
constituencies or other nonfinancial effects when evaluating a merger or
business combination.

STATE ANTITAKEOVER STATUTES

Review on a CASE-BY-CASE basis proposals to opt in or out of state takeover
statutes (including control share acquisition statutes, control share cash-out
statutes, freezeout provisions, fair price provisions, stakeholder laws, poison
pill endorsements, severance pay and labor contract provisions, antigreenmail
provisions, and disgorgement provisions).

7. CAPITAL STRUCTURE
ADJUSTMENTS TO PAR VALUE OF COMMON STOCK
Vote FOR management proposals to reduce the par value of common stock.

COMMON STOCK AUTHORIZATION
Votes on proposals to increase the number of shares of common stock authorized
for issuance are determined on a CASE-BY-CASE basis using a model developed by
ISS.

Vote AGAINST proposals at companies with dual-class capital structures to
increase the number of authorized shares of the class of stock that has superior
voting rights.

Vote FOR proposals to approve increases beyond the allowable increase when a
company's shares are in danger of being delisted or if a company's ability to
continue to operate as a going concern is uncertain.

DUAL-CLASS STOCK

Vote AGAINST proposals to create a new class of common stock with superior
voting rights.

Vote FOR proposals to create a new class of nonvoting or subvoting common stock
if:
o It is intended for financing purposes with minimal or no dilution to current
shareholders
o It is not designed to preserve the voting power of an insider or significant
shareholder

ISSUE STOCK FOR USE WITH RIGHTS PLAN

Vote AGAINST proposals that increase authorized common stock for the explicit
purpose of implementing a shareholder rights plan (poison pill).

PREEMPTIVE RIGHTS
Review on a CASE-BY-CASE basis shareholder proposals that seek preemptive
rights. In evaluating proposals on preemptive rights, consider the size of a
company, the characteristics of its shareholder base, and the liquidity of the
stock.

PREFERRED STOCK

Vote AGAINST proposals authorizing the creation of new classes of preferred
stock with unspecified voting, conversion, dividend distribution, and other
rights ("blank check" preferred stock).

Vote FOR proposals to create "declawed" blank check preferred stock (stock that
cannot be used as a takeover defense).

Vote FOR proposals to authorize preferred stock in cases where the company
specifies the voting, dividend, conversion, and other rights of such stock and
the terms of the preferred stock appear reasonable.

Vote AGAINST proposals to increase the number of blank check preferred stock
authorized for issuance when no shares have been issued or reserved for a
specific purpose.

Vote CASE-BY-CASE on proposals to increase the number of blank check preferred
shares after analyzing the number of preferred shares available for issue given
a company's industry and performance in terms of shareholder returns.

RECAPITALIZATION

Votes CASE-BY-CASE on recapitalizations (reclassifications of securities),
taking into account the following: more simplified capital structure, enhanced
liquidity, fairness of conversion terms, impact on voting power and dividends,
reasons for the reclassification, conflicts of interest, and other alternatives
considered.

REVERSE STOCK SPLITS

Vote FOR management proposals to implement a reverse stock split when the number
of authorized shares will be proportionately reduced.

Vote FOR management proposals to implement a reverse stock split to avoid
delisting.

Votes on proposals to implement a reverse stock split that do not
proportionately reduce the number of shares authorized for issue should be
determined on a CASE-BY-CASE basis using a model developed by ISS.

SHARE REPURCHASE PROGRAMS

Vote FOR management proposals to institute open-market share repurchase plans in
which all shareholders may participate on equal terms.

STOCK DISTRIBUTIONS: SPLITS AND DIVIDENDS

Vote FOR management proposals to increase the common share authorization for a
stock split or share dividend, provided that the increase in authorized shares
would not result in an excessive number of shares available for issuance as
determined using a model developed by ISS.

TRACKING STOCK
Votes on the creation of tracking stock are determined on a CASE-BY-CASE basis,
weighing the strategic value of the transaction against such factors as: adverse
governance changes, excessive increases in authorized capital stock, unfair
method of distribution, diminution of voting rights, adverse conversion
features, negative impact on stock option plans, and other alternatives such as
spinoff.

8. EXECUTIVE AND DIRECTOR COMPENSATION
Votes with respect to equity-based compensation plans should be determined on a
CASE-BY-CASE basis. Our methodology for reviewing compensation plans primarily
focuses on the transfer of shareholder wealth (the dollar cost of pay plans to
shareholders instead of simply focusing on voting power dilution). Using the
expanded compensation data disclosed under the SEC's rules, ISS will value every
award type. ISS will include in its analyses an estimated dollar cost for the
proposed plan and all continuing plans. This cost, dilution to shareholders'
equity, will also be expressed as a percentage figure for the transfer of
shareholder wealth, and will be considered along with dilution to voting power.
Once ISS determines the estimated cost of the plan, we compare it to a
companyspecific dilution cap.

Our model determines a company-specific allowable pool of shareholder wealth
that may be transferred from the company to plan participants, adjusted for:
o Long-term corporate performance (on an absolute basis and relative to a
standard industry peer group and an appropriate market index),
o Cash compensation, and
o Categorization of the company as emerging, growth, or mature.
These adjustments are pegged to market capitalization.

Vote AGAINST plans that expressly permit the repricing of underwater stock
options without shareholder approval.

Generally vote AGAINST plans in which the CEO participates if there is a
disconnect between the CEO's pay and company performance (an increase in pay and
a decrease in performance) and the main source of the pay increase (over half)
is equity-based. A decrease in performance is based on negative one- and three-
year total shareholder returns. An increase in pay is based on the CEO's total
direct compensation (salary, cash bonus, present value of stock options, face
value of restricted stock, face value of longterm incentive plan payouts, and
all other compensation) increasing over the previous year. Also WITHHOLD votes
from the Compensation Committee members.

DIRECTOR COMPENSATION

Votes on compensation plans for directors are determined on a CASE-BY-CASE
basis, using a proprietary, quantitative model developed by ISS.

STOCK PLANS IN LIEU OF CASH

Votes for plans which provide participants with the option of taking all or a
portion of their cash compensation in the form of stock are determined on a
CASE-BY-CASE basis.

Vote FOR plans which provide a dollar- for-dollar cash for stock exchange. Votes
for plans which do not provide a dollar-for-dollar cash for stock exchange
should be determined on a CASE-BY-CASE basis using a proprietary, quantitative
model developed by ISS.

DIRECTOR RETIREMENT PLANS

Vote AGAINST retirement plans for nonemployee directors.

Vote FOR shareholder proposals to eliminate retirement plans for nonemployee
directors.

MANAGEMENT PROPOSALS SEEKING APPROVAL TO REPRICE OPTIONS

Votes on management proposals seeking approval to reprice options are
evaluated on a CASE-BY-CASE basis giving consideration to the following:
o Historic trading patterns
o Rationale for the repricing
o Value-for-value exchange
o Option vesting
o Term of the option
o Exercise price
o Participation.

EMPLOYEE STOCK PURCHASE PLANS
Votes on employee stock purchase plans should be determined on a CASE-BY-CASE
basis.

Vote FOR employee stock purchase plans where all of the following apply:
o Purchase price is at least 85 percent of fair market value
o Offering period is 27 months or less, and
o The number of shares allocated to the plan is ten percent or less of the
outstanding shares

Vote AGAINST employee stock purchase plans where any of the following apply:
o Purchase price is less than 85 percent of fair market value, or
o Offering period is greater than 27 months, or
o The number of shares allocated to the plan is more than ten percent of the
outstanding shares

INCENTIVE BONUS PLANS AND TAX DEDUCTIBILITY PROPOSALS (OBRA-RELATED COMPENSATION
PROPOSALS)

Vote FOR proposals that simply amend shareholder-approved compensation plans to
include administrative features or place a cap on the annual grants any one
participant may receive to comply with the provisions of Section 162(m).

Vote FOR proposals to add performance goals to existing compensation plans to
comply with the provisions of Section 162(m) unless they are clearly
inappropriate.

Votes to amend existing plans to increase shares reserved and to qualify for
favorable tax treatment under the provisions of Section 162(m) should be
considered on a CASE-BYCASE basis using a proprietary, quantitative model
developed by ISS.

Generally vote FOR cash or cash and stock bonus plans that are submitted to
shareholders for the purpose of exempting compensation from taxes under the
provisions of Section 162(m) if no increase in shares is requested.

EMPLOYEE STOCK OWNERSHIP PLANS (ESOPS)

Vote FOR proposals to implement an ESOP or increase authorized shares for
existing ESOPs, unless the number of shares allocated to the ESOP is excessive
(more than five percent of outstanding shares.)

401(K) EMPLOYEE BENEFIT PLANS

Vote FOR proposals to implement a 401(k) savings plan for employees.

SHAREHOLDER PROPOSALS REGARDING EXECUTIVE AND DIRECTOR PAY

Generally, vote FOR shareholder proposals seeking additional disclosure of
executive and director pay information, provided the information requested is
relevant to shareholders' needs, would not put the company at a competitive
disadvantage relative to its industry, and is not unduly burdensome to the
company.

Vote AGAINST shareholder proposals seeking to set absolute levels on
compensation or otherwise dictate the amount or form of compensation.

Vote AGAINST shareholder proposals requiring director fees be paid in stock
only.

Vote FOR shareholder proposals to put option repricings to a shareholder
vote.

Vote on a CASE-BY-CASE basis for all other shareholder proposals regarding
executive and director pay, taking into account company performance, pay level
versus peers, pay level versus industry, and long term corporate outlook.

OPTION EXPENSING
Generally vote FOR shareholder proposals asking the company to expense stock
options, unless the company has already publicly committed to expensing options
by a specific date.

PERFORMANCE-BASED STOCK OPTIONS
Generally vote FOR shareholder proposals advocating the use of performance-based
stock options (indexed, premium-priced, and performance-vested options), unless:
o The proposal is overly restrictive (e.g., it mandates that awards to all
employees must be performance-based or all awards to top executives must be a
particular type, such as indexed options)
o The company demonstrates that it is using a substantial portion of
performance-based awards for its top executives

GOLDEN PARACHUTES AND EXECUTIVE SEVERANCE AGREEMENTS
Vote FOR shareholder proposals to require golden parachutes or executive
severance agreements to be submitted for shareholder ratification, unless the
proposal requires shareholder approval prior to entering into employment
contracts.

Vote on a CASE-BY-CASE basis on proposals to ratify or cancel golden
parachutes. An acceptable parachute should include the following:
o The parachute should be less attractive than an ongoing employment
opportunity with the firm
o The triggering mechanism should be beyond the control of management
o The amount should not exceed three times base salary plus guaranteed benefits

PENSION PLAN INCOME ACCOUNTING
Generally vote FOR shareholder proposals to exclude pension plan income in
the calculation of earnings used in determining executive
bonuses/compensation.

SUPPLEMENTAL EXECUTIVE RETIREMENT PLANS (SERPS)
Generally vote FOR shareholder proposals requesting to put extraordinary
benefits contained in SERP agreements to a shareho lder vote unless the
company's executive pension plans do not contain excessive benefits beyond what
is offered under employeewide plans.

9. SOCIAL AND ENVIRONMENTAL ISSUES
CONSUMER ISSUES AND PUBLIC SAFETY
ANIMAL RIGHTS
Vote CASE-BY-CASE on proposals to phase out the use of animals in product
testing, taking into account:
o The nature of the product and the degree that animal testing is necessary or
federally mandated (such as medical products),
o The availability and feasibility of alternatives to animal testing to ensure
product safety, and
o The degree that competitors are using animal-free testing.
Generally vote FOR proposals seeking a report on the company's animal welfare
standards unless:
o The company has already published a set of animal welfare standards and
monitors compliance

o The company's standards are comparable to or better than those of peer firms,
and
o There are no serious controversies surrounding the company's treatment of
animals

DRUG PRICING
Vote CASE-BY-CASE on proposals asking the company to implement price
restraints on pharmaceutical products, taking into account:
o Whether the proposal focuses on a specific drug and region
o Whether the economic benefits of providing subsidized drugs (e.g., public
goodwill) outweigh the costs in terms of reduced profits, lower R&D spending,
and harm to competitiveness
o The extent that reduced prices can be offset through the company's marketing
budget without affecting R&D spending
o Whether the company already limits price increases of its products
o Whether the company already contributes life-saving pharmaceuticals to the
needy and Third World countries
o The extent that peer companies implement price restraints

GENETICALLY MODIFIED FOODS

Vote AGAINST proposals asking companies to voluntarily label genetically
engineered (GE) ingredients in their products or alternatively to provide
interim labeling and eventually eliminate GE ingredients due to the costs and
feasibility of labeling and/or phasing out the use of GE ingredients.

Vote CASE-BY-CASE on proposals asking for a report on the feasibility of
labeling products containing GE ingredients taking into account:

o The relevance of the proposal in terms of the company's business and the
proportion of it affected by the resolution

o The quality of the company's disclosure on GE product labeling and related
voluntary initiatives and how this disclosure compares with peer company
disclosure

o Company's current disclosure on the feasibility of GE product
labeling, including information on the related costs

o Any voluntary labeling initiatives undertaken or considered by the company.

Vote CASE-BY-CASE on proposals asking for the preparation of a report on the
financial, legal, and environmental impact of continued use of GE
ingredients/seeds.

o The relevance of the proposal in terms of the company's business and the
proportion of it affected by the resolution

o The quality of the company's disclosure on risks related to GE product
use and how this disclosure compares with peer company disclosure

o The percentage of revenue derived from international operations,
particularly in Europe, where GE products are more regulated and
consumer backlash is more pronounced.

Vote AGAINST proposals seeking a report on the health and environmental effects
of genetically modified organisms (GMOs). Health studies of this sort are better
undertaken by regulators and the scientific community.

Vote AGAINST proposals to completely phase out GE ingredients from the company's
products or proposals asking for reports outlining the steps necessary to
eliminate GE ingredients from the company's products. Such resolutions
presuppose that there are proven health risks to GE ingredients (an issue better
left to federal regulators) that outweigh the economic benefits derived from
biotechnology.

HANDGUNS
Generally vote AGAINST requests for reports on a company's policies aimed at
curtailing gun violence in the United States unless the report is confined to
product safety information. Criminal misuse of firearms is beyond company
control and instead falls within the purview of law enforcement agencies.

HIV/AIDS
Vote CASE-BY-CASE on requests for reports outlining the impact of the health
pandemic (HIV/AIDS, malaria and tuberculosis) on the company's Sub-Saharan
operations and how the company is responding to it, taking into account:
o The nature and size of the company's operations in Sub-Saharan Africa and
the number of local employees
o The company's existing healthcare policies, including benefits and
healthcare access for local workers
o Company donations to healthcare providers operating in the region

Vote CASE-BY-CASE on proposals asking companies to establish, implement, and
report on a standard of response to the HIV/AIDS, tuberculosis and malaria
health pandemic in Africa and other developing countries, taking into account:
o The company's actions in developing countries to address HIV/AIDS,
tuberculosis and malaria, including donations of pharmaceuticals and work
with public health organizations
o The company's initiatives in this regard compared to those of peer companies

PREDATORY LENDING
Vote CASE-BY CASE on requests for reports on the company's procedures for
preventing predatory lending, including the establishment of a board
committee for oversight, taking into account:
o Whether the company has adequately disclosed mechanisms in place to prevent
abusive lending practices
o Whether the company has adequately disclosed the financial risks of its
subprime business
o Whether the company has been subject to violations of le nding laws or
serious lending controversies
o Peer companies' policies to prevent abusive lending practices.

TOBACCO
Most tobacco-related proposals should be evaluated on a CASE-BY-CASE basis,
taking into account the following factors:
Second-hand smoke:
o Whether the company complies with all local ordinances and regulations
o The degree that voluntary restrictions beyond those mandated by law might hurt
the company's competitiveness
o The risk of any health-related liabilities.
Advertising to youth:
o Whether the company complies with federal, state, and local laws on the
marketing of tobacco or if it has been fined for violations
o Whether the company has gone as far as peers in restricting advertising
o Whether the company entered into the Master Settlement Agreement, which
restricts marketing of tobacco to youth
o Whether restrictions on marketing to youth extend to foreign countries
Cease production of tobacco-related products or avoid selling products to
tobacco companies:
o The percentage of the company's business affected
o The economic loss of eliminating the business versus any potential
tobacco-related liabilities.

Spinoff tobacco-related businesses:
o The percentage of the company's business affected
o The feasibility of a spinoff
o Potential future liabilities related to the company's tobacco business.

Stronger product warnings:
Vote AGAINST proposals seeking stronger product warnings. Such decisions are
better left to public health authorities.

Investment in tobacco stocks:

Vote AGAINST proposals prohibiting investment in tobacco equities. Such
decisions are better left to portfolio managers.

ENVIRONMENT AND ENERGY
ARCTIC NATIONAL WILDLIFE REFUGE
Vote CASE-BY-CASE on reports outlining potential environmental damage from
drilling in the Arctic National Wildlife Refuge (ANWR), taking into account:
o Whether there are publicly available environmental impact reports
o Whether the company has a poor environmental track record, such as violations
of federal and state regulations or accidental spills
o The current status of legislation regarding drilling in ANWR.

CERES PRINCIPLES
Vote CASE-BY-CASE on proposals to adopt the CERES Principles, taking into
account:

o The company's current environmental disclosure beyond legal requirements,
including environmental health and safety (EHS) audits and reports that may
duplicate CERES
o The company's environmental performance record, including violations of
federal and state regulations, level of toxic emissions, and accidental spills
o Environmentally conscious practices of peer companies, including
endorsement of CERES
o Costs of membership and implementation.

ENVIRONMENTAL-ECONOMIC RISK REPORT
Vote CASE-BY-CASE on proposals requesting reports assessing economic risks of
environmental pollution or climate change, taking into account whether the
company has clearly disclosed the following in its public documents:
o Approximate costs of complying with current or proposed environmental
laws
o Steps company is taking to reduce greenhouse gasses or other
environmental pollutants
o Measurements of the company's emissions levels
o Reduction targets or goals for environmental pollutants including
greenhouse gasses

ENVIRONMENTAL REPORTS
Generally vote FOR requests for reports disclosing the company's environmental
policies unless it already has well-documented environmental management systems
that are available to the public.

GLOBAL WARMING
Generally vote FOR reports on the level of greenhouse gas emissions from the
company's operations and products, unless the report is duplicative of the
company's current environmental disclosure and reporting or is not integral to
the company's line of business. However, additional reporting may be warranted
if:
o The company's level of disclosure lags that of its competitors, or
o The company has a poor environmental track record, such as violations of
federal and state regulations.

RECYCLING
Vote CASE-BY-CASE on proposals to adopt a comprehensive recycling strategy,
taking into account:
o The nature of the company's business and the percentage affected
o The extent that peer companies are recycling
o The timetable prescribed by the proposal
o The costs and methods of implementation
o Whether the company has a poor environmental track record, such as
violations of federal and state regulations.

RENEWABLE ENERGY
Vote CASE-BY-CASE on proposals to invest in renewable energy sources,
taking into account:

o The nature of the company's business and the percentage affected
o The extent that peer companies are switching from fossil fuels to cleaner
sources
o The timetable and specific action prescribed by the proposal
o The costs of implementation
o The company's initiatives to address climate change
Generally vote FOR requests for reports on the feasibility of developing
renewable energy sources, unless the report is duplicative of the company's
current environmental disclosure and reporting or is not integral to the
company's line of business.

SUSTAINABILITY REPORT

Generally vote FOR proposals requesting the company to report on its policies
and practices related to social, environmental, and economic sustainability,
unless the company is already reporting on its sustainability initiatives
through existing reports such as:
o A combination of an EHS or other environmental report, code of conduct,
and/or supplier/vendor standards, and equal opportunity and diversity
data and programs, all of which are publicly available, or
o A report based on Global Reporting Initiative (GRI) or similar guidelines.
Vote FOR shareholder proposals asking companies to provide a sustainability
report applying the GRI guidelines unless:
o The company already has a comprehensive sustainability report or
equivalent addressing the essential elements of the GRI guidelines or
o The company has publicly committed to using the GRI format by a specific
date

GENERAL CORPORATE ISSUES
LINK EXECUTIVE COMPENSATION TO SOCIAL PERFORMANCE
Vote CASE-BY-CASE on proposals to review ways of linking executive compensation
to social factors, such as corporate downsizings, customer or employee
satisfaction, community involvement, human rights, environmental performance,
predatory lending, and executive/employee pay disparities. Such resolutions
should be evaluated in the context of:
o The relevance of the issue to be linked to pay
o The degree that social performance is already included in the company's pay
structure and disclosed
o The degree that social performance is used by peer companies in setting pay
o Violations or complaints filed against the company relating to the
particular social performance measure
o Artificial limits sought by the proposal, such as freezing or capping
executive pay
o Independence of the compensation committee
o Current company pay levels.

CHARITABLE/POLITICAL CONTRIBUTIONS
Generally vote AGAINST proposals asking the company to affirm political
nonpartisanship in the workplace so long as:

o The company is in compliance with laws governing corporate political
activities, and
o The company has procedures in place to ensure that employee contributions
to company-sponsored political action committees (PACs) are strictly
voluntary and not coercive.

Vote AGAINST proposals to report or publish in newspapers the company's
political contributions. Federal and state laws restrict the amount of corporate
contributions and include reporting requirements.

Vote AGAINST proposals disallowing the company from making political
contributions. Businesses are affected by legislation at the federal, state, and
local level and barring contributions can put the company at a competitive
disadvantage.

Vote AGAINST proposals restricting the company from making charitable
contributions. Charitable contributions are generally useful for assisting
worthwhile causes and for creating goodwill in the community. In the absence of
bad faith, self-dealing, or gross negligence, management should determine which
contributions are in the best interests of the company.

Vote AGAINST proposals asking for a list of company executives, directors,
consultants, legal counsels, lobbyists, or investment bankers that have prior
government service and whether such service had a bearing on the business of the
company. Such a list would be burdensome to prepare without providing any
meaningful information to shareholders.

LABOR STANDARDS AND HUMAN RIGHTS
CHINA PRINCIPLES
Vote AGAINST proposals to implement the China Principles unless:
o There are serious controversies surrounding the company's China operations,
and
o The company does not have a code of conduct with standards similar to those
promulgated by the International Labor Organization (ILO).
COUNTRY-SPECIFIC HUMAN RIGHTS REPORTS
Vote CASE-BY-CASE on requests for reports detailing the company's operations in
a particular country and steps to protect human rights, based on:
o The nature and amount of company business in that country
o The company's workplace code of conduct
o Proprietary and confidential information involved
o Company compliance with U.S. regulations on investing in the country
o Level of peer company involvement in the country.

INTERNATIONAL CODES OF CONDUCT/VENDOR STANDARDS
Vote CASE-BY-CASE on proposals to implement certain human rights standards at
company facilities or those of its suppliers and to commit to outside,
independent monitoring. In evaluating these proposals, the following should be
considered:
o The company's current workplace code of conduct or adherence to other global
standards and the degree they meet the standards promulgated by the proponent
o Agreements with foreign suppliers to meet certain workplace standards

o Whether company and vendor facilities are monitored and how
o Company participation in fair labor organizations
o Type of business
o Proportion of business conducted overseas
o Countries of operation with known human rights abuses
o Whether the company has been recently involved in significant labor and
human rights controversies or violations
o Peer company standards and practices
o Union presence in company's international factories

Generally vote FOR reports outlining vendor standards compliance unless any
of the following apply:
o The company does not operate in countries with significant human rights
violations
o The company has no recent human rights controversies or violations, or
o The company already publicly discloses information on its vendor
standards compliance.

MACBRIDE PRINCIPLES
Vote CASE-BY-CASE on proposals to endorse or increase activity on the MacBride
Principles, taking into account:
o Company compliance with or violations of the Fair Employment Act of 1989
o Company antidiscrimination policies that already exceed the legal
requirements
o The cost and feasibility of adopting all nine principles
o The cost of duplicating efforts to follow two sets of standards (Fair
Employment and the MacBride Principles)
o The potential for charges of reverse discrimination
o The potential that any company sales or contracts in the rest of the United
Kingdom could be negatively impacted
o The level of the company's inve stment in Northern Ireland
o The number of company employees in Northern Ireland
o The degree that industry peers have adopted the MacBride Principles
o Applicable state and municipal laws that limit contracts with companies
that have not adopted the MacBride Principles.

MILITARY BUSINESS
FOREIGN MILITARY SALES/OFFSETS
Vote AGAINST reports on foreign military sales or offsets. Such disclosures may
involve sensitive and confidential information. Moreover, companies must comply
with government controls and reporting on foreign military sales.

LANDMINES AND CLUSTER BOMBS
Vote CASE-BY-CASE on proposals asking a company to renounce future involvement
in antipersonnel landmine production, taking into account:
o Whether the company has in the past manufactured landmine components
o Whether the company's peers have renounced future production

Vote CASE-BY-CASE on proposals asking a company to renounce future involvement
in cluster bomb production, taking into account:
o What weapons classifications the proponent views as cluster bombs
o Whether the company currently or in the past has manufactured cluster bombs
or their components
o The percentage of revenue derived from cluster bomb manufacturing
o Whether the company's peers have renounced future production

NUCLEAR WEAPONS
Vote AGAINST proposals asking a company to cease production of nuclear weapons
components and delivery systems, including disengaging from current and proposed
contracts. Components and delivery systems serve multiple military and non-
military uses, and withdrawal from these contracts could have a negative impact
on the company's business.

OPERATIONS IN NATIONS SPONSORING TERRORISM (IRAN)
Vote CASE-BY-CASE on requests for a board committee review and report outlining
the company's financial and reputational risks from its operations in Iran,
taking into account current disclosure on:
o The nature and purpose of the Iranian operations and the amount of business
involved (direct and indirect revenues and expenses) that could be affected
by political disruption
o Compliance with U.S. sanctions and laws

SPACED-BASED WEAPONIZATION
Generally vote FOR reports on a company's involvement in spaced-based
weaponization unless:
o The information is already publicly available or
o The disclosures sought could compromise proprietary information.

WORKPLACE DIVERSITY
BOARD DIVERSITY
Generally vote FOR reports on the company's efforts to diversify the board,
unless:
o The board composition is reasonably inclusive in relation to companies of
similar size and business or
o The board already reports on its nominating procedures and diversity
initiatives.
Vote CASE-BY-CASE on proposals asking the company to increase the representation
of women and minorities on the board, taking into account:
o The degree of board diversity
o Comparison with peer companies
o Established process for improving board diversity
o Existence of independent nominating committee
o Use of outside search firm
o History of EEO violations.

EQUAL EMPLOYMENT OPPORTUNITY (EEO)

Generally vote FOR reports outlining the company's affirmative action
initiatives unless all of the following apply:
o The company has well-documented equal opportunity programs
o The company already publicly reports on its company-wide affirmative
initiatives and provides data on its workforce diversity, and
o The company has no recent EEO-related violations or litigation.

Vote AGAINST proposals seeking information on the diversity efforts of suppliers
and service providers, which can pose a significant cost and administration
burden on the company.

GLASS CEILING
Generally vote FOR reports outlining the company's progress towards the
Glass Ceiling Commission's business recommendations, unless:
o The composition of senior management and the board is fairly inclusive
o The company has well-documented programs addressing diversity initiatives and
leadership development
o The company already issues public reports on its company-wide affirmative
initiatives and provides data on its workforce diversity, and
o The company has had no recent, significant EEO-related violations or
litigation

SEXUAL ORIENTATION

Vote FOR proposals seeking to amend a company's EEO statement in order to
prohibit discrimination based on sexual orientation, unless the change would
result in excessive costs for the company.
Vote AGAINST proposals to extend company benefits to or eliminate benefits
from domestic partners. Benefits decisions should be left to the discretion of
the company.

ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.

Not yet applicable.

ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.

REGISTRANT PURCHASES OF EQUITY SECURITIES

------------------------------------------------------------------------------------------------------------------------------------
(C) TOTAL NUMBER OF SHARES (D) MAXIMUM NUMBER (OR
(A) TOTAL NUMBER (B) AVERAGE (OR UNITS) PURCHASED AS PART APPROXIMATE DOLLAR VALUE) OF SHARES
OF SHARES (OR PRICE PAID PER OF PUBLICLY ANNOUNCED PLANS (OR UNITS) THAT MAY YET BE PURCHASED
PERIOD UNITS) PURCHASED SHARE (OR UNIT) OR PROGRAMS UNDER THE PLANS OR PROGRAMS

------------------------------------------------------------------------------------------------------------------------------------

7/1/04- 0 N/A N/A N/A
7/31/04
------------------------------------------------------------------------------------------------------------------------------------
8/1/04- 0 N/A N/A N/A
8/31/04
------------------------------------------------------------------------------------------------------------------------------------
9/1/04- 0 N/A N/A N/A
9/30/04
------------------------------------------------------------------------------------------------------------------------------------
10/1/04- 46 $15.6010 N/A N/A
10/31/04)
------------------------------------------------------------------------------------------------------------------------------------
11/1/04- 0 N/A N/A N/A
11/30/04)
------------------------------------------------------------------------------------------------------------------------------------
12/1/04- 63 $17.2154 N/A N/A
12/31/04
------------------------------------------------------------------------------------------------------------------------------------
Total 109*

------------------------------------------------------------------------------------------------------------------------------------

*Shares represent estimated shares purchased on behalf of certain trustees
pursuant to dividend reinvestment plan.

ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

There have been no material changes to the procedures by which the shareholders
may recommend nominees to the registrant's board of directors, where those
changes were implemented after the registrant last provided disclosure in
response to the requirements of Item 7(d)(2)(ii)(G) of Schedule 14A (17 CFR
240.14a-101), or this Item.

ITEM 11. CONTROLS AND PROCEDURES.

(a) The registrant's principal executive and principal financial officers,
or persons performing similar functions, have concluded that the
registrant's disclosure controls and procedures (as defined in Rule
30a-3(c) under the Investment Company Act of 1940, as amended (the
"1940 Act") (17 CFR 270.30a-3(c))) are effective, as of a date within
90 days of the filing date of the report that includes the disclosure
required by this paragraph, based on their evaluation of these controls
and procedures required by Rule 30a-3(b) under the 1940 Act (17 CFR
270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b) under the Securities
Exchange Act of 1934, as amended (17 CFR 240.13a-15(b) or
240.15d-15(b)).

(b) There were no changes in the registrant's internal control over
financial reporting (as defined in Rule 30a-3(d) under the 1940 Act (17
CFR 270.30a-3(d)) that occurred during the registrant's second fiscal
quarter of the period covered by this report that has materially
affected, or is reasonably likely to materially affect, the
registrant's internal control over financial reporting.

ITEM 12. EXHIBITS.

(a)(1) Code of ethics, or any amendment thereto, that is the subject of
disclosure required by Item 2 is attached hereto.

(a)(2) Certifications pursuant to Rule 30a-2(a) under the 1940 Act and
Section 302 of the Sarbanes-Oxley Act of 2002 are attached hereto.

(a)(3) Not applicable.

(b) Certifications pursuant to Rule 30a-2(b) under the 1940 Act and
Section 906 of the Sarbanes-Oxley Act of 2002 are attached hereto.

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.

(registrant) FIRST TRUST VALUE LINE(R)100 FUND
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By (Signature and Title)* /S/ JAMES A. BOWEN
-------------------------------------------------------
James A. Bowen, Chief Executive Officer
(principal executive officer)

Date FEBRUARY 24, 2005
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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 (Signature and Title)* /S/ JAMES A. BOWEN
-------------------------------------------------------
James A. Bowen, Chief Executive Officer
(principal executive officer)

Date FEBRUARY 24, 2005
----------------------------------------------------------------------------

By (Signature and Title)* /S/ MARK R. BRADLEY
-------------------------------------------------------
Mark R. Bradley, Chief Financial Officer
(principal financial officer)

Date FEBRUARY 24, 2005
----------------------------------------------------------------------------

* Print the name and title of each signing officer under his or her signature.