Edgar Filing: DELAWARE INVESTMENTS DIVIDEND & INCOME FUND, INC

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

FORM N-Q

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED
MANAGEMENT INVESTMENT COMPANY

Investment Company Act file number:		811-07460

Exact name of registrant as specified in charter:		Delaware Investments^®Dividend and
		Income Fund, Inc.

Address of principal executive offices:		2005 Market Street
		Philadelphia, PA 19103

Name and address of agent for service:		David F. Connor, Esq.
		2005 Market Street
		Philadelphia, PA 19103

Registrant’s telephone number, including area code:		(800) 523-1918

Date of fiscal year end:		November 30

Date of reporting period:		August 31, 2014

Item 1. Schedule of Investments.

Schedule of investments

Delaware Investments^®Dividend and Income Fund, Inc.
August 31, 2014 (Unaudited)

		Number of	Value
		shares	(U.S. $)
Common Stock – 81.40%
	Consumer Discretionary – 4.52%
	DIRECTV Class A †	1,550	$	133,997
	General Motors	1,211		42,143
	Johnson Controls	39,900		1,947,519
	Lowe’s	42,100		2,210,671
	Tarkett Class W/I *	9,027		278,745
				4,613,075
Consumer Staples – 8.10%
	Archer-Daniels-Midland	43,700		2,178,882
	CVS Caremark	26,500		2,105,425
	Hanesbrands	590		60,581
	Kraft Foods Group	33,533		1,975,094
	Mondelez International
	Class A	53,500		1,936,165
				8,256,147
Diversified REITs – 1.44%
	Fibra Uno Administracion †	116,400		419,215
	Fifth Street Finance	20,943		205,870
	Lexington Realty Trust	62,300		677,824
	Nieuwe Steen Investments	243		1,383
	Vornado Realty Trust	665		70,404
	Washington Real Estate
	Investment Trust	3,500		97,230
				1,471,926
Energy – 10.04%
	Chevron	15,600		2,019,420
	ConocoPhillips	23,600		1,916,792
	Halcon Resources †	363		1,994
	Halliburton	29,000		1,960,690
	Kodiak Oil & Gas †	4,776		77,706
	Marathon Oil	51,300		2,138,697
	Occidental Petroleum	20,000		2,074,600
	Range Resources	589		46,289
				10,236,188
Financials – 8.20%
	Allstate	34,700		2,133,703
	Bank of New York Mellon	53,800		2,107,884
	BB&T	54,600		2,038,218
	Marsh & McLennan	39,200		2,081,520
				8,361,325
Healthcare – 12.29%
	Akorn *†	1,099		42,883
	Baxter International	27,100		2,031,958
	Cardinal Health	28,900		2,129,930
	Johnson & Johnson	19,100		1,981,243
	LTC Properties	2,500		102,375
	Merck	34,700		2,085,817
	Pfizer	66,589		1,957,051
	Quest Diagnostics	34,200		2,161,782
	Valeant Pharmaceuticals
	International †	296		34,721
				12,527,760
Healthcare REITs – 1.01%
	HCP	6,650		288,145
	Health Care REIT	4,660		314,923
	Healthcare Trust of America
	Class A	23,400		291,330
	Sabra Health Care REIT	4,700		133,856
				1,028,254
Hotel REITs – 1.09%
	Ashford Hospitality Prime	1,700		27,523
	Ashford Hospitality Trust	7,900		91,561
	DiamondRock Hospitality	15,800		210,456
	LaSalle Hotel Properties	2,600		95,030
	Strategic Hotels & Resorts †	26,900		319,572
	Summit Hotel Properties	33,800		370,110
				1,114,252
Industrial REITs – 1.04%
	First Industrial Realty Trust	23,600		429,520
	Prologis	780		31,933
	STAG Industrial	19,400		454,542
	Terreno Realty	7,300		147,752
				1,063,747
Industrials – 6.29%
	Northrop Grumman	16,900		2,150,018
	Raytheon	22,000		2,119,480
	Waste Management	45,600		2,141,832
				6,411,330
Information Technology – 8.24%
	Broadcom Class A	54,000		2,126,520
	Cisco Systems	80,400		2,009,196
	Intel	59,800		2,088,216
	Xerox	157,300		2,172,313
				8,396,245
Mall REITs – 1.81%
	CBL & Associates Properties	10,834		205,846
	General Growth Properties	4,129		101,450
	Macerich	1,226		80,046
	Rouse Properties	228		3,985
	Simon Property Group	8,547		1,453,246
				1,844,573

(continues) NQ-DDF [8/14] 10/14 (13301) 1

Schedule of investments

Delaware Investments^®Dividend and Income Fund, Inc. (Unaudited)

		Number of	Value
		shares	(U.S. $)
Common Stock (continued)
Manufactured Housing REIT – 0.38%
	Sun Communities	7,300	$	391,499
				391,499
Materials – 2.00%
	duPont (E.I.) deNemours	30,900		2,042,799
				2,042,799
Mixed REITs – 0.11%
	PS Business Parks	1,400		114,156
				114,156
Mortgage REIT – 0.29%
	Starwood Property Trust	12,200		290,970
				290,970
Multifamily REITs – 1.37%
	Apartment Investment &
	Management	10,919		374,194
	Camden Property Trust	2,950		220,778
	Education Realty Trust	22,500		245,025
	Equity Residential	5,000		332,350
	Essex Property Trust	1,147		221,887
				1,394,234
Office REITs – 1.40%
	alstria office REIT *†	21,023		281,076
	Corporate Office Properties
	Trust	16,400		465,432
	Equity Commonwealth	7,600		204,288
	Parkway Properties	23,000		477,250
				1,428,046
Self-Storage REITs – 0.38%
	Extra Space Storage	7,300		384,710
				384,710
Shopping Center REITs – 1.80%
	Agree Realty	17,500		516,775
	Federal Realty Investment
	Trust	200		24,956
	First Capital Realty	10,481		186,235
	Kimco Realty	15,530		364,800
	Kite Realty Group Trust	8,900		228,908
	Ramco-Gershenson Properties
	Trust	11,700		198,432
	Weingarten Realty Investors	2,500		85,550
	Wheeler Real Estate
	Investment Trust *@	45,156		227,135
				1,832,791
Single Tenant REITs – 0.67%
	American Realty Capital
	Properties	37,100		488,236
	National Retail Properties *	5,300		196,842
				685,078
Specialty REITs – 2.54%
	AMC Entertainment Holdings	15,000		355,050
	EPR Properties	5,220		297,070
	Gladstone Land	24,800		306,528
	Home Loan Servicing
	Solutions	35,400		775,260
	Plum Creek Timber	5,285		214,730
	Rayonier	2,200		75,394
	Santander Consumer USA
	Holdings	9,852		183,444
	Solar Capital	15,528		310,560
	Starwood Waypoint
	Residential Trust †	2,400		66,432
				2,584,468
Telecommunications – 4.13%
	AT&T	56,400		1,971,744
	Century Communications =†	500,000		0
	Frontier Communications	30,300		206,040
	Verizon Communications	40,800		2,032,656
				4,210,440
Utilities – 2.26%
	American Water Works	3,200		161,952
	Edison International	36,300		2,146,782
				2,308,734

Total Common Stock
	(cost $58,228,007)			82,992,747

Convertible Preferred Stock – 3.22%
ArcelorMittal 6.00% exercise
	price $20.36, expiration
	date 12/21/15 *	8,575		194,545
Chesapeake Energy 144A
	5.75% exercise price
	$26.14, expiration date
	12/31/49 #	187		225,335
El Paso Energy Capital Trust I
	4.75% exercise price
	$34.49, expiration date
	3/31/28	5,250		309,907
Exelon 6.50% exercise price
	$43.75, expiration date
	6/1/17	6,300		318,150
Halcon Resources 5.75%
	exercise price $6.16,
	expiration date 12/31/49	130		130,390

2 NQ-DDF [8/14] 10/14 (13301)

(Unaudited)

		Number of		Value
		shares		(U.S. $)
Convertible Preferred Stock (continued)
	HealthSouth 6.50% exercise
	price $30.01, expiration
	date 12/31/49	238	$	329,392
	Huntington Bancshares
	8.50% exercise price
	$11.95, expiration date
	12/31/49	182		245,700
	Intelsat 5.75% exercise price
	$22.05, expiration date
	5/1/16	6,910		331,335
	Laclede Group 6.75%
	exercise price $57.81,
	expiration date 4/1/17	1,550		85,513
	Maiden Holdings 7.25%
	exercise price $15.47,
	expiration date 9/15/16	6,000		282,240
	SandRidge Energy
	7.00% exercise price
	$7.76, expiration date
	12/31/49	1,000		96,750
	8.50% exercise price
	$8.01, expiration date
	12/31/49	1,780		178,667
	Wells Fargo 7.50% exercise
	price $156.71, expiration
	date 12/31/49	259		314,936
	Weyerhaeuser 6.375%
	exercise price $33.20,
	expiration date 7/1/16	1,788		103,275
	Wheeler Real Estate
	Investment Trust
	9.00% exercise price
	$5.00, expiration date
	12/31/49 *	3,960		100,386
	9.00% exercise price
	$5.00, expiration date
	12/31/49 @=	34		35,557
Total Convertible Preferred
	Stock (cost $3,024,564)			3,282,078

		Principal
		amount°
Convertible Bonds – 8.26%
Basic Industry – 0.10%
	Peabody Energy 4.75%
	exercise price $57.62,
	expiration date 12/15/41 *	135,000		97,706
				97,706
Capital Goods – 0.43%
	General Cable 4.50% exercise
	price $35.33, expiration
	date 11/15/29 ϕ	242,000		215,834
	Titan Machinery 3.75%
	exercise price $43.17,
	expiration date 4/30/19 *	277,000		216,753
				432,587
Communications – 1.42%
	Alaska Communications
	Systems Group 6.25%
	exercise price $10.28,
	expiration date 4/27/18	253,000		206,195
	Blucora 144A 4.25% exercise
	price $21.66, expiration
	date 3/29/19 #	148,000		149,757
	Clearwire Communications
	144A 8.25% exercise price
	$7.08, expiration date
	11/30/40 #T	213,000		242,820
	Equinix 4.75% exercise price
	$84.32, expiration date
	6/13/16	17,000		44,912
	Liberty Interactive
	0.75% exercise price
	$1,000.00, expiration date
	3/30/43	205,000		278,928
	144A 1.00% exercise price
	$74.31, expiration date
	9/28/43 #	364,000		377,195
	SBA Communications 4.00%
	exercise price $30.38,
	expiration date 9/29/14	41,000		148,471
				1,448,278
Consumer Cyclical – 0.68%
	Iconix Brand Group 2.50%
	exercise price $30.75,
	expiration date 5/31/16	164,000		230,933
	Live Nation Entertainment
	144A 2.50% exercise price
	$34.68, expiration date
	5/13/19 #	41,000		41,307
	Meritor 4.00% exercise price
	$26.73, expiration date
	2/12/27 ϕ	394,000		423,550
				695,790

(continues) NQ-DDF [8/14] 10/14 (13301) 3

Schedule of investments

Delaware Investments^®Dividend and Income Fund, Inc. (Unaudited)

		Principal	Value
		amount°	(U.S. $)
Convertible Bonds (continued)
Consumer Non-Cyclical – 2.01%
	BioMarin Pharmaceutical
	1.50% exercise price
	$94.15, expiration date
	10/13/20 *	122,000	$	136,106
	Cardtronics 144A 1.00%
	exercise price $52.35,
	expiration date
	11/27/20 #*	359,000		344,417
	Hologic
	2.00% exercise price
	$38.59, expiration date
	12/15/43	227,000		249,133
	2.00% exercise price
	$31.17, expiration date
	2/27/42 *ϕ	214,000		230,317
	NuVasive 2.75% exercise
	price $42.13, expiration
	date 6/30/17	380,000		430,113
	Salix Pharmaceuticals 1.50%
	exercise price $65.81,
	expiration date 3/15/19	45,000		110,559
	Spectrum Pharmaceuticals
	144A 2.75% exercise price
	$10.53, expiration date
	12/13/18 #	144,000		150,300
	Vector Group
	1.75% exercise price
	$27.16, expiration date
	4/15/20	223,000		251,851
	2.50% exercise price
	$17.62, expiration date
	1/14/19 •	97,000		141,490
				2,044,286
Energy – 0.79%
	Chesapeake Energy 2.50%
	exercise price $47.77,
	expiration date 5/15/37	126,000		131,119
	Energy XXI Bermuda 144A
	3.00% exercise price
	$40.40, expiration date
	12/13/18 #	316,000		285,190
	Helix Energy Solutions Group
	3.25% exercise price
	$25.02, expiration date
	3/12/32	140,000		190,050
	Vantage Drilling 144A 5.50%
	exercise price $2.39,
	expiration date 7/15/43 #	189,000		201,757
				808,116
Financials – 0.77%
	Ares Capital 5.75% exercise
	price $19.13, expiration
	date 2/1/16	189,000		200,576
	BGC Partners 4.50% exercise
	price $9.84, expiration
	date 7/13/16	287,000		304,399
	Gain Capital Holdings 144A
	4.125% exercise price
	$12.00, expiration date
	11/30/18 #	180,000		165,713
	New Mountain Finance 144A
	5.00% exercise price
	$15.93, expiration date
	6/14/19 #	114,000		117,776
				788,464
Real Estate Investment Trusts – 0.85%
	Blackstone Mortgage Trust
	5.25% exercise price
	$28.66, expiration date
	12/1/18	285,000		306,019
	Campus Crest Communities
	Operating Partnership
	144A 4.75% exercise price
	$12.56, expiration date
	10/11/18 #	224,000		221,340
	Forest City Enterprises
	3.625% exercise price
	$24.21, expiration date
	8/14/20	140,000		149,187
	Lexington Realty Trust 144A
	6.00% exercise price
	$6.68, expiration date
	1/11/30 #	118,000		189,611
				866,157
Technology – 1.21%
	Ciena 144A 3.75% exercise
	price $20.17, expiration
	date 10/15/18 #	179,000		233,371
	Intel 3.25% exercise price
	$21.71, expiration date
	8/1/39	155,000		262,241
	j2 Global 3.25% exercise
	price $69.37, expiration
	date 6/14/29	256,000		265,920
	SanDisk 1.50% exercise price
	$51.53, expiration date
	8/11/17 *	105,000		202,650

4 NQ-DDF [8/14] 10/14 (13301)

(Unaudited)

		Principal	Value
		amount°	(U.S. $)
Convertible Bonds (continued)
Technology (continued)
	VeriSign 3.25% exercise price
	$34.37, expiration date
	8/15/37	158,000	$	273,735
				1,237,917
Total Convertible Bonds
	(cost $7,504,947)			8,419,301

Corporate Bonds – 35.50%
Automobiles – 1.26%
	American Axle &
	Manufacturing
	7.75% 11/15/19	103,000		117,677
	Chassix 144A
	9.25% 8/1/18 #	105,000		109,200
	General Motors
	4.875% 10/2/23	90,000		96,750
	6.25% 10/2/43	115,000		135,413
	General Motors Financial
	6.75% 6/1/18	180,000		202,725
	International Automotive
	Components Group 144A
	9.125% 6/1/18 #	220,000		235,400
	Meritor
	6.25% 2/15/24	65,000		67,113
	6.75% 6/15/21	110,000		116,875
	Tupy Overseas 144A
	6.625% 7/17/24 #	200,000		208,100
				1,289,253
Banking – 1.29%
	Barclays Bank
	7.625% 11/21/22	200,000		225,000
	Credit Suisse Group 144A
	7.50% 12/29/49 #•	305,000		331,687
	JPMorgan Chase
	6.75% 1/29/49 •	205,000		221,144
	Lloyds Banking Group 7.50%
	4/30/49 *•	330,000		346,913
	Popular 7.00% 7/1/19	190,000		191,900
				1,316,644
Basic Industry – 4.20%
	AK Steel 7.625% 5/15/20 *	204,000		211,905
	ArcelorMittal 6.125% 6/1/18	185,000		201,881
	Arch Coal 144A
	8.00% 1/15/19 #*	175,000		169,313
	Builders FirstSource 144A
	7.625% 6/1/21 #*	197,000		206,357
	Cemex 144A
	7.25% 1/15/21 #	200,000		220,250
	CPG Merger Sub 144A
	8.00% 10/1/21 #*	185,000		194,713
	Essar Steel Minnesota 144A
	11.50% 5/15/20 #	55,000		56,581
	First Quantum Minerals
	144A 6.75% 2/15/20 #	97,000		101,123
	144A 7.00% 2/15/21 #	97,000		102,335
	144A 7.25% 5/15/22 #	250,000		264,375
	FMG Resources August 2006
	144A 6.875% 4/1/22 #*	212,000		231,743
	Hardwoods Acquisition 144A
	7.50% 8/1/21 #	135,000		137,700
	HD Supply 11.50% 7/15/20	170,000		200,387
	INEOS Group Holdings 144A
	5.875% 2/15/19 #	200,000		205,500
	JMC Steel Group 144A
	8.25% 3/15/18 #	145,000		147,356
	Kissner Milling 144A
	7.25% 6/1/19 #	155,000		160,231
	LSB Industries 7.75% 8/1/19	140,000		153,650
	Masonite International 144A
	8.25% 4/15/21 #	205,000		223,450
	New Gold 144A
	6.25% 11/15/22 #	190,000		200,450
	Nortek 8.50% 4/15/21	129,000		140,933
	Polymer Group 144A
	6.875% 6/1/19 #	185,000		187,775
	Ryerson
	9.00% 10/15/17	120,000		128,100
	11.25% 10/15/18	50,000		55,750
	TPC Group 144A
	8.75% 12/15/20 #	210,000		232,575
	Wise Metals Group 144A
	8.75% 12/15/18 #	80,000		86,800
	Wise Metals Intermediate
	Holdings 144A
	9.75% 6/15/19 #	55,000		58,369
				4,279,602
Capital Goods – 2.48%
	Accudyne Industries 144A
	7.75% 12/15/20 #	180,000		193,500
	Ardagh Packaging Finance
	144A 6.00% 6/30/21 #	200,000		198,500
	B/E Aerospace 5.25% 4/1/22	90,000		97,875
	BWAY Holding 144A
	9.125% 8/15/21 #	340,000		350,200
	Consolidated Container 144A
	10.125% 7/15/20 #	171,000		171,000

(continues) NQ-DDF [8/14] 10/14 (13301) 5

Schedule of investments

Delaware Investments^®Dividend and Income Fund, Inc. (Unaudited)

		Principal	Value
		amount°	(U.S. $)
Corporate Bonds (continued)
Capital Goods (continued)
	Gardner Denver 144A
	6.875% 8/15/21 #*	90,000	$	95,625
	Gates Global 144A
	6.00% 7/15/22 #	335,000		333,325
	Milacron 144A
	7.75% 2/15/21 #	180,000		194,850
	Plastipak Holdings 144A
	6.50% 10/1/21 #	145,000		152,250
	Reynolds Group Issuer
	8.25% 2/15/21 *	145,000		158,956
	Signode Industrial Group
	144A 6.375% 5/1/22 #	175,000		174,563
	TransDigm
	144A 6.00% 7/15/22 #	215,000		219,031
	144A 6.50% 7/15/24 #	180,000		184,725
				2,524,400
Communications – 3.65%
	CenturyLink 6.75% 12/1/23 *	115,000		127,722
	Cogent Communications
	Finance 144A
	5.625% 4/15/21 #	185,000		185,000
	Digicel Group
	144A 7.125% 4/1/22 #	200,000		208,000
	144A 8.25% 9/30/20 #	221,000		239,785
	Hughes Satellite Systems
	7.625% 6/15/21	160,000		181,600
	Intelsat Luxembourg
	8.125% 6/1/23	835,000		908,063
	Level 3 Escrow II 144A
	5.375% 8/15/22 #	220,000		221,650
	Sprint
	144A 7.125% 6/15/24 #	485,000		496,519
	144A 7.25% 9/15/21 #	210,000		223,125
	144A 7.875% 9/15/23 #	125,000		134,375
	Sprint Capital 6.90% 5/1/19	40,000		43,150
	T-Mobile USA
	6.125% 1/15/22	55,000		57,200
	6.25% 4/1/21	85,000		88,506
	6.50% 1/15/24	35,000		36,487
	Wind Acquisition Finance
	144A 7.375% 4/23/21 #	200,000		211,500
	Windstream
	7.50% 6/1/22	105,000		114,581
	7.75% 10/1/21	115,000		125,925
	Zayo Group 10.125% 7/1/20	107,000		122,114
				3,725,302
Consumer Cyclical – 1.85%
	BI-LO 144A PIK 8.625%
	9/15/18 #T	225,000		222,187
	DBP Holding 144A
	7.75% 10/15/20 #	121,000		115,555
	Landry’s 144A
	9.375% 5/1/20 #	320,000		345,600
	Men’s Wearhouse 144A
	7.00% 7/1/22 #*	105,000		110,513
	Michaels Stores 144A
	5.875% 12/15/20 #	145,000		147,247
	Murphy Oil USA
	6.00% 8/15/23	190,000		202,350
	Pantry 8.375% 8/1/20	195,000		209,625
	Party City Holdings
	8.875% 8/1/20	210,000		232,575
	PF Chang’s China Bistro 144A
	10.25% 6/30/20 #	130,000		133,900
	Rite Aid 6.75% 6/15/21 *	115,000		122,619
	Roundy’s Supermarkets 144A
	10.25% 12/15/20 #	50,000		48,625
				1,890,796
Consumer Non-Cyclical – 0.74%
	Crestview DS Merger Sub II
	10.00% 9/1/21	125,000		141,875
	Darling Ingredients 144A
	5.375% 1/15/22 #	70,000		72,887
	JBS Investments 144A
	7.75% 10/28/20 #	200,000		217,000
	Prestige Brands 144A
	5.375% 12/15/21 #	140,000		139,650
	Spectrum Brands
	6.375% 11/15/20	35,000		37,800
	6.625% 11/15/22	135,000		146,813
				756,025
Energy – 6.26%
	Athlon Holdings 144A
	6.00% 5/1/22 #*	165,000		170,363
	Baytex Energy
	144A 5.125% 6/1/21 #	40,000		40,200
	144A 5.625% 6/1/24 #	175,000		175,656
	Calumet Specialty Products
	Partners 7.625% 1/15/22	280,000		294,000
	Chaparral Energy
	7.625% 11/15/22	90,000		97,087
	8.25% 9/1/21	105,000		113,794
	CHC Helicopter
	9.375% 6/1/21 *	200,000		224,000

6 NQ-DDF [8/14] 10/14 (13301)

(Unaudited)

		Principal	Value
		amount°	(U.S. $)
Corporate Bonds (continued)
Energy (continued)
	Chesapeake Energy
	4.875% 4/15/22	345,000	$	362,664
	Compressco Partners 144A
	7.25% 8/15/22 #	215,000		217,687
	Energy Transfer Equity
	5.875% 1/15/24	86,000		91,267
	Energy XXI Gulf Coast 144A
	6.875% 3/15/24 #	190,000		193,800
	Exterran Partners
	6.00% 4/1/21	195,000		197,925
	FTS International 144A
	6.25% 5/1/22 #	200,000		205,500
	Genesis Energy
	5.75% 2/15/21	215,000		223,063
	Halcon Resources
	8.875% 5/15/21	105,000		111,037
	9.75% 7/15/20	205,000		221,913
	Hercules Offshore
	144A 6.75% 4/1/22 #*	200,000		181,250
	144A 7.50% 10/1/21 #*	95,000		90,250
	144A 8.75% 7/15/21 #	55,000		55,825
	Key Energy Services
	6.75% 3/1/21	275,000		280,500
	Laredo Petroleum
	5.625% 1/15/22	85,000		87,763
	7.375% 5/1/22	100,000		110,000
	Midstates Petroleum
	9.25% 6/1/21	285,000		309,937
	Northern Blizzard Resources
	144A 7.25% 2/1/22 #	124,000		131,440
	Northern Oil & Gas
	8.00% 6/1/20	175,000		184,625
	NuStar Logistics
	6.75% 2/1/21	115,000		128,225
	Oasis Petroleum
	6.875% 3/15/22	135,000		148,163
	Ocean Rig UDW 144A
	7.25% 4/1/19 #	250,000		250,000
	Offshore Group Investment
	7.125% 4/1/23	90,000		89,775
	PDC Energy 7.75% 10/15/22	185,000		203,500
	Pioneer Energy Services 144A
	6.125% 3/15/22 #	190,000		193,800
	Regency Energy Partners
	5.875% 3/1/22	190,000		205,200
	Samson Investment
	9.75% 2/15/20	201,000		206,025
	SandRidge Energy
	8.125% 10/15/22	243,000		259,403
	Triangle USA Petroleum 144A
	6.75% 7/15/22 #	195,000		200,363
	Warren Resources 144A
	9.00% 8/1/22 #	125,000		126,406
				6,382,406
Financials – 0.24%
	Nuveen Investments 144A
	9.50% 10/15/20 #	205,000		240,330
				240,330
Healthcare – 2.87%
	Air Medical Group Holdings
	9.25% 11/1/18	109,000		115,131
	Amsurg 144A
	5.625% 7/15/22 #	105,000		107,887
	Community Health Systems
	144A 6.875% 2/1/22 #	240,000		256,200
	7.125% 7/15/20	50,000		54,187
	8.00% 11/15/19	9,000		9,810
	Crimson Merger Sub 144A
	6.625% 5/15/22 #	185,000		176,906
	DaVita HealthCare Partners
	5.125% 7/15/24	450,000		457,313
	Immucor 11.125% 8/15/19	155,000		172,825
	Kinetic Concepts
	10.50% 11/1/18	124,000		138,725
	12.50% 11/1/19 *	85,000		97,219
	Mallinckrodt International
	Finance 4.75% 4/15/23	105,000		99,487
	MPH Acquisition Holdings
	144A 6.625% 4/1/22 #	90,000		94,387
	Par Pharmaceutical
	7.375% 10/15/20	380,000		404,700
	Salix Pharmaceuticals 144A
	6.00% 1/15/21 #	225,000		244,687
	Tenet Healthcare
	144A 5.00% 3/1/19 #	130,000		131,950
	6.00% 10/1/20	85,000		92,437
	8.125% 4/1/22	115,000		132,681
	Valeant Pharmaceuticals
	International
	144A 5.625% 12/1/21 #*	50,000		50,937
	144A 6.375% 10/15/20 #	85,000		89,250
				2,926,719
Insurance – 0.99%
	American International Group
	8.175% 5/15/58 •	170,000		235,025
	Hockey Merger Sub 2 144A
	7.875% 10/1/21 #	210,000		222,075

(continues) NQ-DDF [8/14] 10/14 (13301) 7

Schedule of investments

Delaware Investments^®Dividend and Income Fund, Inc. (Unaudited)

		Principal	Value
		amount°	(U.S. $)
Corporate Bonds (continued)
Insurance (continued)
	Hub Holdings 144A PIK
	8.125% 7/15/19 #T	55,000	$	55,894
	Onex USI Acquisition 144A
	7.75% 1/15/21 #	190,000		196,650
	XL Group 6.50% 10/29/49 •	305,000		295,469
				1,005,113
Media – 3.01%
	Altice 144A 7.75% 5/15/22 #	210,000		223,650
	CCO Holdings
	5.25% 9/30/22	230,000		234,313
	Clear Channel
	Communications PIK
	14.00% 2/1/21 *✤	191,900		193,339
	Columbus International 144A
	7.375% 3/30/21 #	200,000		218,500
	CSC Holdings 144A
	5.25% 6/1/24 #	335,000		332,487
	DISH DBS 5.00% 3/15/23	250,000		249,375
	Gray Television
	7.50% 10/1/20	180,000		190,800
	MDC Partners 144A
	6.75% 4/1/20 #	200,000		210,000
	Mediacom Broadband 144A
	5.50% 4/15/21 #	120,000		121,950
	Numericable Group 144A
	6.00% 5/15/22 #	210,000		216,563
	RCN Telecom Services 144A
	8.50% 8/15/20 #	100,000		107,250
	Sinclair Television Group
	144A 5.625% 8/1/24 #	345,000		345,863
	Virgin Media Finance 144A
	6.375% 4/15/23 #	200,000		214,000
	VTR Finance 144A
	6.875% 1/15/24 #	200,000		215,000
				3,073,090
Services – 2.85%
	Algeco Scotsman Global
	Finance 144A
	10.75% 10/15/19 #	280,000		280,700
	BlueLine Rental Finance 144A
	7.00% 2/1/19 #	110,000		116,600
	Caesars Growth Properties
	Holdings 144A
	9.375% 5/1/22 #	205,000		198,722
	Covanta Holding
	5.875% 3/1/24	200,000		208,000
	Mattamy Group 144A
	6.50% 11/15/20 #	235,000		239,700
	MCE Finance 144A
	5.00% 2/15/21 #	200,000		200,000
	MGM Resorts International
	6.75% 10/1/20	55,000		61,050
	7.75% 3/15/22	90,000		105,525
	11.375% 3/1/18	80,000		101,400
	Navios South American
	Logistics 144A
	7.25% 5/1/22 #	180,000		186,975
	Pinnacle Entertainment
	6.375% 8/1/21	85,000		88,613
	7.75% 4/1/22 *	60,000		65,100
	8.75% 5/15/20 *	30,000		32,325
	Stena 144A 7.00% 2/1/24 #*	235,000		249,687
	United Rentals North America
	5.75% 11/15/24	435,000		456,750
	Vander Intermediate Holding
	II 144A PIK 9.75%
	2/1/19 #*T	75,000		80,437
	Watco 144A
	6.375% 4/1/23 #	90,000		92,475
	West 144A
	5.375% 7/15/22 #	145,000		141,375
				2,905,434
Technology – 2.14%
	BMC Software Finance 144A
	8.125% 7/15/21 #	110,000		111,650
	CommScope 144A
	5.50% 6/15/24 #	200,000		204,500
	Entegris 144A
	6.00% 4/1/22 #	200,000		207,000
	First Data
	11.25% 1/15/21	150,000		174,750
	11.75% 8/15/21	272,000		323,000
	First Data Holdings 144A PIK
	14.50% 9/24/19 #T	9,258		10,531
	Infinity Acquisition 144A
	7.25% 8/1/22 #	245,000		243,163
	Infor Software Parent 144A
	PIK 7.125% 5/1/21 #*T	250,000		255,625
	j2 Global 8.00% 8/1/20	185,000		203,037
	Micron Technology 144A
	5.50% 2/1/25 #	110,000		111,650
	NCR
	5.875% 12/15/21	50,000		52,625
	6.375% 12/15/23	165,000		179,025
	Viasystems 144A
	7.875% 5/1/19 #	100,000		104,000
				2,180,556

8 NQ-DDF [8/14] 10/14 (13301)

(Unaudited)

		Principal	Value
		amount°	(U.S. $)
Corporate Bonds (continued)
Utilities – 1.67%
	AES
	5.50% 3/15/24	155,000	$	158,487
	7.375% 7/1/21	133,000		152,950
	AES Gener 144A
	8.375% 12/18/73 #•	200,000		229,000
	Calpine
	5.375% 1/15/23	320,000		323,600
	5.75% 1/15/25 *	75,000		75,844
	144A 5.875% 1/15/24 #*	100,000		107,500
	Dynegy 5.875% 6/1/23 *	120,000		117,300
	Elwood Energy
	8.159% 7/5/26	99,120		112,253
	Enel 144A
	8.75% 9/24/73 #•	200,000		236,000
	NRG Energy 144A
	6.25% 5/1/24 #	180,000		186,750
				1,699,684
Total Corporate Bonds
	(cost $34,989,660)			36,195,354

Senior Secured Loans – 3.48%«
	Akorn Tranche B
	4.50% 11/13/20	55,000		55,068
	Applied Systems 2nd Lien
	7.50% 1/15/22	192,000		193,920
	Ashland Water 2nd Lien
	7.75% 7/2/22	75,000		74,625
	Atkore International 2nd Lien
	7.75% 9/27/21	105,000		104,344
	Azure Midstream Tranche B
	6.50% 10/21/18	44,554		45,041
	BJ’s Wholesale Club 2nd Lien
	8.50% 3/31/20	205,000		207,861
	Borgata Tranche B 1st Lien
	6.75% 8/15/18	189,050		191,341
	Caesars Growth Partners
	Tranche B 1st Lien
	6.25% 5/8/21	105,000		102,953
	Citycenter Holdings Tranche B
	5.00% 10/9/20	172,760		172,847
	Clear Channel
	Communications Tranche D
	6.75% 1/30/19	315,000		310,078
	Flint Group Tranche 2nd Lien
	8.25% 5/2/22	210,000		209,650
	Gentiva Health Services
	Tranche B
	6.50% 10/10/19	149,250		149,553
	Hostess Brands 1st Lien
	6.75% 3/12/20	199,500		205,485
	LTS Buyer 2nd Lien
	8.00% 3/15/21	28,463		28,712
	Mauser Holdings 2nd Lien
	8.25% 6/30/22	215,000		215,134
	Moxie Liberty Tranche B
	7.50% 8/21/20	105,000		108,413
	Moxie Patriot (Panda Power
	Fund) Tranche B1
	6.75% 12/18/20	100,000		103,250
	Nuveen Investments 2nd Lien
	6.50% 2/28/19	100,000		100,400
	Otterbox Tranche B
	5.75% 5/30/20	155,000		153,644
	Panda Temple Power II
	Tranche B 1st Lien
	7.25% 3/28/19	105,000		108,413
	Polymer Group Tranche B
	5.25% 12/13/19	164,175		164,534
	Rite Aid 2nd Lien
	5.75% 8/3/20	97,000		98,425
	Samson Investment 2nd Lien
	5.00% 9/25/18	205,000		203,225
	Travelport Finance
	Luxembourg Sarl Tranche B
	1st Lien 6.00% 8/15/21	135,000		135,827
	Vantage Drilling Tranche B 1st
	Lien 5.75% 3/28/19	109,446		109,286
Total Senior Secured Loans
	(cost $3,536,382)			3,552,029

		Number of
		shares
Limited Partnership – 1.80%
	Ares Management *	16,900		302,172
	Brookfield Infrastructure
	Partners *	9,400		399,030
	Lehigh Gas Partners	31,200		1,129,128
Total Limited Partnership
	(cost $1,209,823)			1,830,330

Preferred Stock – 1.07%
	Ally Financial 144A 7.00% #	400		404,162
	GMAC Capital Trust I
	8.125% •	8,000		215,040
	MetLife 5.00%	8,575		268,998

(continues) NQ-DDF [8/14] 10/14 (13301) 9

Schedule of investments

Delaware Investments^®Dividend and Income Fund, Inc. (Unaudited)

		Number of	Value
		shares	(U.S. $)
Preferred Stock (continued)
	Regions Financial 6.375% *	8,000	$	199,120
Total Preferred Stock
	(cost $1,006,784)			1,087,320

Warrant – 0.00%
	Wheeler Real Estate
	Investment Trust strike
	price $5.50, expiration
	date 4/29/19 @†	4,752		3,231
Total Warrant (cost $39)				3,231

		Principal
		amount°
Short-Term Investments – 4.08%
Discount Notes – 1.37% ≠
	Federal Home Loan Bank
	0.055% 9/12/14	671,422		671,422
	0.075% 11/19/14	53,560		53,556
	0.077% 11/14/14	672,497		672,454
				1,397,432
Repurchase Agreements – 2.71%
	Bank of America Merrill Lynch
	0.02%, dated 8/29/14, to
	be repurchased on 9/2/14,
	repurchase price $700,174
	(collateralized by U.S.
	government obligations
	0.00%-2.125%
	9/18/14-5/15/44; market
	value $714,175)	700,172		700,172
	Bank of Montreal
	0.05%, dated 8/29/14, to
	be repurchased on 9/2/14,
	repurchase price $233,391
	(collateralized by U.S.
	government obligations
	0.00%-4.375%
	1/2/15-2/15/38; market
	value $238,058)	233,390		233,390
	BNP Paribas
	0.05%, dated 8/29/14, to
	be repurchased on 9/2/14,
	repurchase price
	$1,823,448 (collateralized
	by U.S. government
	obligations
	0.00%-3.125%
	2/26/15-8/15/21; market
	value $1,859,907)	1,823,438		1,823,438
				2,757,000

Total Short-Term
	Investments
	(cost $4,154,352)			4,154,432
Total Value of Securities
	Before Securities Lending
	Collateral – 138.81%
	(cost $113,654,558)			141,516,822

		Number of
		shares
Securities Lending Collateral – 6.57%**
Investment Company
	Delaware Investments
	Collateral Fund No.1	6,700,422		6,700,422
Total Securities Lending
	Collateral (cost $6,700,422)			6,700,422

Total Value of
	Securities – 145.38%
	(cost $120,354,980)			148,217,244n
Obligation to Return
	Securities Lending
	Collateral – (6.57%)			(6,700,422	)

Borrowing Under Line of
	Credit – (39.24%)			(40,000,000	)
Receivables and Other
	Assets Net of
	Liabilities – 0.43%«			436,740
Net Assets – 100.00%			$	101,953,562

10 NQ-DDF [8/14] 10/14 (13301)

(Unaudited)

#	Security exempt from registration under Rule 144A of the Securities Act of 1933, as amended. At Aug. 31, 2014, the aggregate value of Rule 144A securities was $23,261,117,which represented 22.82% of the Fund’s net assets. See Note 6 in “Notes.”
*	Fully or partially on loan.
**	See Note 5 in“Notes”for additional information on securities lending collateral and non-cash collateral.
@	Illiquid security. At Aug. 31, 2014, the aggregate value of illiquid securities was $265,923, which represented 0.26% of the Fund’s net assets. See Note 6 in “Notes.”
✤	100% of the income received was in the form of both cash and par.
T	100% of the income received was in the form of additional cash.
«	Includes $8,000 cash collateral for futures contracts.
=	Security is being fair valued in accordance with the Fund’s fair valuation policy. At Aug. 31, 2014,the aggregate value of fair valued securities was $35,557, which represented 0.03% of the Fund’s net assets. See Note 1 in “Notes.”
≠	The rate shown is the effective yield at the time of purchase.
n	Includes $6,493,624 of securities loaned.
°	Principal amount shown is stated in U.S. dollars unless noted that the security is denominated in another currency.
†	Non income producing security.
•	Variable rate security. The rate shown is the rate as of Aug. 31, 2014. Interest rates reset periodically.
«	Senior secured loans generally pay interest at rates which are periodically redetermined by reference to a base lending rate plus a premium. These base lending rates are generally: (i) the prime rate offered by one or more United States banks, (ii) the lending rate offered by one or more European banks such as the London Inter-Bank Offered Rate (LIBOR), and (iii) the certificate of deposit rate. Senior secured loans may be subject to restrictions on resale. Stated rate in effect at Aug. 31, 2014.
ϕ	Step coupon bond.Coupon increases or decreases periodically based on a predetermined schedule.Stated rate in effect at Aug. 31, 2014.

The following futures contracts were outstanding at Aug. 31, 2014:¹

Futures Contracts

	Notional			Unrealized
	Cost	Notional	Expiration	Appreciation
Contracts to Buy (Sell)	(Proceeds)	Value	Date	(Depreciation)
(8) U.S. Treasury 5 yr Notes	$(949,290)	$(950,688)	1/2/15	$ (1,398)

The use of futures contracts involves elements of market risk and risks in excess of the amounts disclosed in the financial statements. The notional value presented above represents the Fund’s total exposure in such contracts, whereas only the net unrealized appreciation (depreciation) is reflected in the Fund’s net assets.

¹See Note 4 in “Notes.”

Summary of abbreviations:

PIK - Pay-in-kind
REIT - Real Estate Investment Trust

NQ-DDF [8/14] 10/14 (13301) 11

Notes

Delaware Investments^®Dividend and Income Fund, Inc.
August 31, 2014 (Unaudited)

1. Significant Accounting Policies

The following accounting policies are in accordance with U.S. generally accepted accounting principles (U.S. GAAP) and are consistently followed by Delaware Investments^®Dividend and Income Fund, Inc. (Fund). This report covers the period of time since the Fund’s last fiscal year end.

Security Valuation — Equity securities and Exchange-Traded Funds (ETFs), except those traded on the Nasdaq Stock Market, Inc. (Nasdaq), are valued at the last quoted sales price as of the time of the regular close of the New York Stock Exchange on the valuation date. Securities and ETFs traded on the Nasdaq are valued in accordance with the Nasdaq Official Closing Price, which may not be the last sales price. If, on a particular day, an equity security or ETF does not trade, then the mean between the bid and ask prices will be used, which approximates fair value. Securities listed on a foreign exchange are normally valued at the last quoted sales price on the valuation date. U.S. government and agency securities are valued at the mean between the bid and ask prices, which approximates fair value. Investment company securities are valued at net asset value per share, as reported by the underlying investment company. Other debt securities are valued based upon valuations provided by an independent pricing service or broker and reviewed by management. To the extent current market prices are not available, the pricing service may take into account developments related to the specific security, as well as transactions in comparable securities. Valuations for fixed income securities utilize matrix systems, which reflect such factors as security prices, yields, maturities, and ratings, and are supplemented by dealer and exchange quotations. Foreign currency exchange contracts and foreign cross currency exchange contracts are valued at the mean between the bid and ask prices, which approximates fair value. Interpolated values are derived when the settlement date of the contract is an interim date for which quotations are not available. Futures contracts and options on futures contracts are valued at the daily quoted settlement prices. Exchange-traded options are valued at the last reported sale price or, if no sales are reported, at the mean between the last reported bid and ask prices, which approximates fair value. Generally, other securities and assets for which market quotations are not readily available are valued at fair value as determined in good faith under the direction of the Fund’s Board of Directors (Board). In determining whether market quotations are readily available or fair valuation will be used, various factors will be taken into consideration, such as market closures or suspension of trading in a security. The Fund may use fair value pricing more frequently for securities traded primarily in non-U.S. markets because, among other things, most foreign markets close well before the Fund values its securities, generally as of 4:00 p.m. Eastern time. The earlier close of these foreign markets gives rise to the possibility that significant events, including broad market moves, government actions or pronouncements, aftermarket trading, or news events may have occurred in the interim. To account for this, the Fund may frequently value foreign securities using fair value prices based on third-party vendor modeling tools (international fair value pricing).

Federal and Foreign Income Taxes — No provision for federal income taxes has been made as the Fund intends to continue to qualify for federal income tax purposes as a regulated investment company under Subchapter M of the Internal Revenue Code of 1986, as amended, and make the requisite distributions to shareholders. The Fund evaluates tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether the tax positions are “more-likely-than-not” of being sustained by the applicable tax authority. Tax positions not deemed to meet the “more-likely-than-not” threshold are recorded as a tax benefit or expense in the current year. Management has analyzed the Fund’s tax positions taken for all open federal income tax years (Nov. 30, 2010–Nov. 30, 2013), and has concluded that no provision for federal income tax is required in the Fund’s financial statements. In regard to foreign taxes only, the Fund has open tax years in certain foreign countries it invests in that may date back to the inception of the Fund.

Repurchase Agreements — The Fund may purchase certain U.S. government securities subject to the counterparty’s agreement to repurchase them at an agreed upon date and price. The counterparty will be required on a daily basis to maintain the value of the collateral subject to the agreement at not less than the repurchase price (including accrued interest). The agreements are conditioned upon the collateral being deposited under the Federal Reserve book-entry system with the Fund’s custodian or a third-party sub-custodian. In the event of default or bankruptcy by the other party to the agreement, retention of the collateral may be subject to legal proceedings. All open repurchase agreements as of the date of this report were entered into on Aug. 29, 2014.

Distributions — The Fund has implemented a managed distribution policy. Under the policy, the Fund is managed with a goal of generating as much of the distribution as possible from net investment income and short-term capital gains. The balance of the distribution will then come from long-term capital gains to the extent permitted, and if necessary, a return of capital. Even though the Fund may realize current year capital gains, such gains may be offset, in whole or in part, by the Fund’s capital loss carryovers from prior years. For federal income tax purposes, the effect of such capital loss carryovers may be to convert (to the extent of such current year gains) what would otherwise be nontaxable returns of capital into distributions taxable as ordinary income. The use of such capital loss carryovers in this circumstance will produce no tax benefit for shareholders, and the capital loss carryovers available to offset future capital gains of the Fund will be reduced. Under the Regulated Investment Company Modernization Act of 2010 (Act), this tax effect attributable to the Fund’s capital loss carryovers (the conversion of returns of capital into distributions taxable as ordinary income) no longer applies to net capital losses of the Fund arising in Fund tax years beginning after Nov. 30, 2011. The actual determination of the source of the Fund’s distributions can be made only at year end. Shareholders should receive written notification regarding the actual components and tax treatments of all Fund distributions for the calendar year 2014 in early 2015.

12 NQ-DDF [8/14] 10/14 (13301)

(Unaudited)

Foreign Currency Transactions — Transactions denominated in foreign currencies are recorded at the prevailing exchange rates on the valuation date in accordance with the Fund’s prospectus. The value of all assets and liabilities denominated in foreign currencies is translated daily into U.S. dollars at the exchange rate of such currencies against the U.S. dollar. Transaction gains or losses resulting from changes in exchange rates during the reporting period or upon settlement of the foreign currency transaction are reported in operations for the current period. The Fund generally bifurcates that portion of realized gains and losses on investments in debt securities which is due to changes in foreign exchange rates from that which is due to changes in market prices of debt securities. For foreign equity securities, these changes are included in net realized and unrealized gain or loss on investments. The Fund reports certain foreign currency related transactions as components of realized gains (losses) for financial reporting purposes, whereas such components are treated as ordinary income (loss) for federal income tax purposes.

Use of Estimates — The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the fair value of investments, the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates and the differences could be material.

Other — Expenses directly attributable to the Fund are charged directly to the Fund. Other expenses common to various funds within the Delaware Investments^®Family of Funds are generally allocated among such funds on the basis of average net assets. Management fees and some other expenses are paid monthly. Security transactions are recorded on the date the securities are purchased or sold (trade date) for financial reporting purposes. Costs used in calculating realized gains and losses on the sale of investment securities are those of the specific securities sold. Dividend income is recorded on the ex-dividend date and interest income is recorded on the accrual basis. Discounts and premiums on debt securities are amortized to interest income over the lives of the respective securities using the effective interest method. Distributions received from investments in Real Estate Investment Trusts (REITs) are recorded as dividend income on the ex-dividend date, subject to reclassification upon notice of the character of such distributions by the issuer. Foreign dividends are also recorded on the ex-dividend date or as soon after the ex-dividend date that the Fund is aware of such dividends, net of all tax withholdings, a portion of which may be reclaimable. Withholding taxes and reclaims on foreign dividends have been recorded in accordance with the Fund’s understanding of the applicable country’s tax rules and rates.

2. Investments

At Aug. 31, 2014, the cost of investments for federal income tax purposes has been estimated since final tax characteristics cannot be determined until fiscal year end. At Aug. 31, 2014, the cost of investments and unrealized appreciation (depreciation) were as follows:

Cost of Investments	$	120,616,722
Aggregate unrealized appreciation	$	28,567,344
Aggregate unrealized depreciation		(966,822	)
Net unrealized appreciation	$	27,600,522

For federal income tax purposes, at November 30, 2013, capital loss carryforwards of $14,059,841 may be carried forward and applied against future capital gains. Capital loss carryforwards will expire as follows: $2,844,205 expires in 2016, and $11,215,636 expires in 2017.

On December 22, 2010, the Act was enacted, which changed various technical rules governing the tax treatment of regulated investment companies. The changes were generally effective for taxable years beginning after the date of enactment. Under the Act, the Fund is permitted to carry forward capital losses incurred in taxable years beginning after the date of enactment for an unlimited period. However, any losses incurred during those future taxable years will be required to be utilized prior to the losses incurred in pre-enactment taxable years, which carry an expiration date. As a result of this ordering rule, pre-enactment capital loss carryforwards may be more likely to expire unused. Additionally,

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2. Investments (continued)
post-enactment capital loss carryforwards will retain their character as either short-term or long-term capital losses rather than being considered all short-term as permitted under previous regulation. There are no losses incurred that will be carried forward under the Act.

U.S. GAAP defines fair value as the price that the Fund would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date under current market conditions. A three-level hierarchy for fair value measurements has been established based upon the transparency of inputs to the valuation of an asset or liability. Inputs may be observable or unobservable and refer broadly to the assumptions that market participants would use in pricing the asset or liability. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability based on market data obtained from sources independent of the reporting entity. Unobservable inputs reflect the reporting entity’s own assumptions about the assumptions that market participants would use in pricing the asset or liability developed based on the best information available under the circumstances. The Fund’s investment in its entirety is assigned a level based upon the observability of the inputs which are significant to the overall valuation. The three-level hierarchy of inputs is summarized below.

Level 1 –	inputs are quoted prices in active markets for identical investments. (Examples: equity securities, open-end investment companies, futures contracts, exchange-traded options contracts)

Level 2 –	other observable inputs, including, but not limited to: quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks, and default rates), or other market-corroborated inputs. (Examples: debt securities, government securities, swap contracts, foreign currency exchange contracts, foreign securities utilizing international fair value pricing, broker-quoted securities, fair valued securities)

Level 3 –	Significant unobservable inputs, including the Fund’s own assumptions used to determine the fair value of investments. (Examples: broker-quoted securities, fair valued securities)

Level 3 investments are valued using significant unobservable inputs. The Fund may also use an income-based valuation approach in which the anticipated future cash flows of the investment are discounted to calculate fair value. Discounts may also be applied due to the nature or duration of any restrictions on the disposition of the investments. Valuations may also be based upon current market prices of securities that are comparable in coupon, rating, maturity, and industry. The derived value of a Level 3 investment may not represent the value which is received upon disposition and this could impact the results of operations.

The following table summarizes the valuation of the Fund’s investments by fair value hierarchy levels as of Aug. 31, 2014:

	Level 1			Level 2		Level 3		Total
Common Stock	$	82,431,543		$	561,204	$	—	$	82,992,747
Convertible Preferred Stock¹		2,005,929			1,240,592		35,557		3,282,078
Corporate Debt		—			44,614,655		—		44,614,655
Senior Secured Loans		—			3,552,029		—		3,552,029
Limited Partnership		1,830,330			—		—		1,830,330
Preferred Stock¹		683,158			404,162		—		1,087,320
Warrant		3,231			—		—		3,231
Short-Term Investments		—			4,154,432		—		4,154,432
Securities Lending Collateral		—			6,700,422		—		6,700,422
Total	$	86,954,191		$	61,227,496	$	35,557	$	148,217,244
Futures Contracts	$	(1,398	)	$	—	$	—	$	(1,398	)

The securities that have been deemed worthless on the “Schedule of investments” are considered to be Level 3 securities in this table.

¹Security type is valued across multiple levels. Level 1 investments represent exchange-traded investments, Level 2 investments represent investments with observable inputs or matrix-priced instruments, and Level 3 investments represent investments without observable inputs. The

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amounts attributed to Level 1 investments, Level 2 investments, and Level 3 investments represent the following percentages of the total market value of security types:

	Level 1	Level 2	Level 3		Total
Common Stock	99.32%	0.68%	—		100.00%
Convertible Preferred Stock	61.12%	37.80%	1.08	%	100.00%
Preferred Stock	62.83%	37.17%	—		100.00%

During the period ended Aug. 31, 2014, there were no transfers between Level 1 investments, Level 2 investments, or Level 3 investments that had a significant impact to the Fund. This does not include transfers between Level 1 investments and Level 2 investments due to the Fund utilizing international fair value pricing during the period. In accordance with the Fair Valuation Procedures described in Note 1, international fair value pricing of securities in the Fund occurs when market volatility exceeds an established rolling threshold. If the threshold is exceeded on a given date, then prices of international securities (those that traded on exchanges that close at a different time than the time that the Fund’s net asset value is determined) will be established using a separate pricing feed from a third party vendor designed to establish a price for each such security as of the time that the Fund’s net asset value is determined. Further, international fair value pricing uses other observable market-based inputs in place of the closing exchange price due to the events occurring after the close of the exchange or market on which the investment is principally traded, causing a change in classification between levels. The Fund’s policy is to recognize transfers between levels at the beginning of the period.

A reconciliation of Level 3 investments is presented when the Fund has a significant amount of Level 3 investments at the beginning, interim, or end of the period in relation to net assets. Management has determined not to provide additional disclosure on Level 3 inputs under ASU No. 2011-04 since the Level 3 investments are not considered significant to the Fund’s net assets at the end of the period.

3. Line of Credit

For the period ended Aug. 31, 2014, the Fund borrowed a portion of the money available to it pursuant to a $40,000,000 Credit Agreement with The Bank of New York Mellon (BNY Mellon) that expires on June 24, 2015. Prior to June 25, 2014, the Credit Agreement was $30,000,000. Depending on market conditions, the amount borrowed by the Fund pursuant to the Credit Agreement may be reduced or possibly increased in the future.

At Aug. 31, 2014, the par value of loans outstanding was $40,000,000, at a variable interest rate of 1.04%. During the period ended Aug. 31, 2014, the average daily balance of loans outstanding was $31,147,263 at a weighted average interest rate of approximately 1.04%. Interest on borrowing is based on a variable short-term rate plus an applicable margin. The commitment fee is computed at a rate of 0.10% per annum on the unused balance. Prior to June 25, 2014, the commitment fee was computed at a rate of 0.15% per annum on the unused balance. The loan is collateralized by the Fund’s portfolio.

4. Derivatives

U.S. GAAP requires disclosures that enable investors to understand: 1) how and why an entity uses derivatives; 2) how they are accounted for; and 3) how they affect an entity’s results of operations and financial position.

Foreign Currency Exchange Contracts — The Fund may enter into foreign currency exchange contracts and foreign cross currency exchange contracts as a way of managing foreign exchange rate risk. The Fund may enter into these contracts to fix the U.S. dollar value of a security that it has agreed to buy or sell for the period between the date the trade was entered into and the date the security is delivered and paid for. The Fund may also use these contracts to hedge the U.S. dollar value of securities it already owns that are denominated in foreign currencies. In addition, the Fund may enter into these contracts to facilitate or expedite the settlement of portfolio transactions. The change in value is recorded as an unrealized gain or loss. When the contract is closed, a realized gain or loss is recorded equal to the difference between the value of the contract at the time it was opened and the value at the time it was closed.

The use of foreign currency exchange contracts and foreign cross currency exchange contracts does not eliminate fluctuations in the underlying prices of the securities, but does establish a rate of exchange that can be achieved in the future. Although foreign currency exchange contracts and foreign cross currency exchange contracts limit the risk of loss due to an unfavorable change in the value of the hedged currency, they also limit any potential gain that might result should the value of the currency change favorably. In addition, the Fund could be exposed to risks if the counterparties to the contracts are unable to meet the terms of their contracts. The Fund’s maximum risk of loss from counterparty credit risk is the value of its currency exchanged with the counterparty. The risk is generally mitigated by having a netting arrangement between the Fund and the counterparty and by the posting of collateral by the counterparty to the Fund to cover the Fund’s exposure to the counterparty. No foreign currency exchange contracts were outstanding at Aug. 31, 2014.

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Futures Contracts — A futures contract is an agreement in which the writer (or seller) of the contract agrees to deliver to the buyer an amount of cash or securities equal to a specific dollar amount times the difference between the value of a specific security or index at the close of the last trading day of the contract and the price at which the agreement is made. The Fund may use futures in the normal course of pursuing its investment objective. The Fund may invest in futures contracts to hedge its existing portfolio securities against fluctuations in fair value caused by changes in interest rates or market conditions. Upon entering into a futures contract, the Fund deposits cash or pledges U.S. government securities to a broker, equal to the minimum “initial margin” requirements of the exchange on which the contract is traded. Subsequent payments are received from the broker or paid to the broker each day, based on the daily fluctuation in the market value of the contract. These receipts or payments are known as “variation margin” and are recorded daily by the Fund as unrealized gains or losses until the contracts are closed. When the contracts are closed, the Fund records a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the value at the time it was closed. Risks of entering into futures contracts include potential imperfect correlation between the futures contracts and the underlying securities and the possibility of an illiquid secondary market for these instruments. When investing in futures, there is reduced counterparty credit risk to the Fund because futures are exchange-traded and the exchange’s clearinghouse, as counterparty to all exchange-traded futures, guarantees against default. The Fund posted $8,000 cash collateral for open futures contracts.

Options Contracts — During the period ended Aug. 31, 2014, the Fund entered into options contracts in the normal course of pursuing its investment objective. The Fund may buy or write options contracts for any number of reasons, including without limitation: to manage the Fund’s exposure to changes in securities prices caused by interest rates and market conditions, and foreign currencies; to earn income; as an efficient means of adjusting the Fund’s overall exposure to certain markets; to protect the value of portfolio securities; and as a cash management tool. The Fund may buy or write call or put options on securities, futures, swaps, swaptions, financial indices, and foreign currencies. When the Fund buys an option, a premium is paid and an asset is recorded and adjusted on a daily basis to reflect the current market value of the options purchased. When the Fund writes an option, a premium is received and a liability is recorded and adjusted on a daily basis to reflect the current market value of the options written. Premiums received from writing options that expire unexercised are treated by the Fund on the expiration date as realized gains. The difference between the premium received and the amount paid on effecting a closing purchase transaction, including brokerage commissions, is treated as realized gain or loss. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security in determining whether the Fund has a realized gain or loss. If a put option is exercised, the premium reduces the cost basis of the securities purchased by the Fund. The Fund, as writer of an option, bears the market risk of an unfavorable change in the price of the security underlying the written option. When writing options, the Fund is subject to minimal counterparty risk because the counterparty is only obligated to pay premiums and does not bear the market risk of an unfavorable market change. No options contracts were outstanding at Aug. 31, 2014.

5. Securities Lending

The Fund, along with other funds in the Delaware Investments^®Family of Funds, may lend its securities pursuant to a security lending agreement (Lending Agreement) with BNY Mellon. At the time a security is loaned, the borrower must post collateral equal to the required percentage of the market value of the loaned security, including any accrued interest. The required percentage is: (1) 102% with respect to U.S. securities and foreign securities that are denominated and payable in U.S. dollars; and (2) 105% with respect to foreign securities. With respect to each loan, if on any business day the aggregate market value of securities collateral plus cash collateral held is less than the aggregate market value of the securities which are the subject of such loan, the borrower will be notified to provide additional collateral by the end of the following business day which, together with the collateral already held, will be not less than the applicable initial collateral requirements for such security loan. If the aggregate market value of securities collateral and cash collateral held with respect to a security loan exceeds the applicable initial collateral requirement, upon the request of the borrower, BNY Mellon must return enough collateral to the borrower by the end of the following business day to reduce the value of the remaining collateral to the applicable initial collateral requirement for such security loan. As a result of the foregoing, the value of the collateral held with respect to a loaned security on any particular day may be more or less than the value of the security on loan.

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Cash collateral received is generally invested in the Delaware Investments Collateral Fund No. 1 (Collective Trust) established by BNY Mellon for the purpose of investment on behalf of funds managed by Delaware Management Company (DMC), a series of Delaware Management Business Trust, that participate in BNY Mellon’s securities lending program. The Collective Trust may invest in U.S. government securities and high-quality corporate debt, asset-backed and other money market securities, and in repurchase agreements collateralized by such securities, provided that the Collective Trust will generally have a dollar-weighted average portfolio maturity of 60 days or less. The Fund can also accept U.S. government securities and letters of credit (non-cash collateral) in connection with securities loans. In the event of default or bankruptcy by the lending agent, realization and/or retention of the collateral may be subject to legal proceedings. In the event the borrower fails to return loaned securities and the collateral received is insufficient to cover the value of the loaned securities and provided such collateral shortfall is not the result of investment losses, the lending agent has agreed to pay the amount of the shortfall to the Fund or, at the discretion of the lending agent, replace the loaned securities. The Fund continues to record dividends or interest, as applicable, on the securities loaned and is subject to changes in value of the securities loaned that may occur during the term of the loan. The Fund has the right under the Lending Agreement to recover the securities from the borrower on demand. With respect to security loans collateralized by non-cash collateral, the Fund receives loan premiums paid by the borrower. With respect to security loans collateralized by cash collateral, the earnings from the collateral investments are shared among the Fund, the security lending agent, and the borrower. The Fund records security lending income net of allocations to the security lending agent, and the borrower.

The Collective Trust used for the investment of cash collateral received from borrowers of securities seeks to maintain a net asset value per unit of $1.00, but there can be no assurance that it will always be able to do so. The Fund may incur investment losses as a result of investing securities lending collateral in the Collective Trust. This could occur if an investment in a Collective Trust defaulted or if it were necessary to liquidate assets in the Collective Trust to meet returns on outstanding security loans at a time when the Collective Trust’s net asset value per unit was less than $1.00. Under those circumstances, the Fund may not receive an amount from the Collective Trust that is equal in amount to the collateral the Fund would be required to return to the borrower of the securities and the Fund would be required to make up for this shortfall.

At Aug. 31, 2014, the value of securities on loan was $6,890,953, for which the Fund received collateral, comprised of non-cash collateral (U.S. government securities) valued at $190,531, and cash collateral of $6,700,422. At Aug. 31, 2014, the value of invested collateral was $6,493,624. Investments purchased with cash collateral are presented on the “Schedule of investments” under the caption “Securities Lending Collateral.”

6. Credit and Market Risk

The Fund borrows through its line of credit for purposes of leveraging. Leveraging may result in higher degrees of volatility because the Fund’s net asset value could be subject to fluctuations in short-term interest rates and changes in market value of portfolio securities attributable to the leverage.

The Fund invests a portion of its assets in high yield fixed income securities, which are securities rated BB or lower by Standard & Poor’s Financial Services, LLC and Ba or lower by Moody’s Investors Service, or similarly rated by another nationally recognized statistical rating organization. Investments in these higher yielding securities are generally accompanied by a greater degree of credit risk than higher rated securities. Additionally, lower rated securities may be more susceptible to adverse economic and competitive industry conditions than investment grade securities.

The Fund invests in REITs and is subject to the risks associated with that industry. If the Fund holds real estate directly as a result of defaults or receives rental income directly from real estate holdings, its tax status as a regulated investment company may be jeopardized. There were no direct real estate holdings during the period ended Aug. 31, 2014. The Fund’s REIT holdings are also affected by interest rate changes, particularly if the REITs it holds use floating rate debt to finance their ongoing operations.

The Fund invests in certain obligations that may have liquidity protection to ensure that the receipt of payments due on the underlying security is timely. Such protection may be provided through guarantees, insurance policies or letters of credit obtained by the issuer or sponsor through third parties, through various means of structuring the transaction or through a combination of such approaches. The Fund will not pay any additional fees for such credit support, although the existence of credit support may increase the price of a security.

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6. Credit and Market Risk (continued)
The Fund may invest up to 10% of its net assets in illiquid securities, which may include securities with contractual restrictions on resale, securities exempt from registration under Rule 144A of the Securities Act of 1933, as amended, and other securities which may not be readily marketable. The relative illiquidity of these securities may impair the Fund from disposing of them in a timely manner and at a fair price when it is necessary or desirable to do so. While maintaining oversight, the Fund’s Board has delegated to DMC the day-to-day functions of determining whether individual securities are liquid for purposes of the Fund’s limitation on investments in illiquid securities. Securities eligible for resale pursuant to Rule 144A, which are determined to be liquid, are not subject to the Fund’s 10% limit on investments in illiquid securities. Rule 144A and illiquid securities have been identified on the ”Schedule of investments.“

7. Subsequent Events

Management has determined that no material events or transactions occurred subsequent to Aug. 31, 2014 that would require recognition or disclosure in the Fund’s ”Schedule of investments.“

18 NQ-DDF [8/14] 10/14 (13301)

Item 2. Controls and Procedures.

The registrant’s principal executive officer and principal financial officer have evaluated the registrant’s disclosure controls and procedures within 90 days of the filing of this report and have concluded that they are effective in providing reasonable assurance that the information required to be disclosed by the registrant in its reports or statements filed under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission.

There were no significant changes in the registrant’s internal control over financial reporting that occurred during the registrant’s last fiscal quarter that have materially affected, or are reasonably likely to materially affect, the registrant’s internal control over financial reporting.

Item 3. Exhibits.

File as exhibits as part of this Form a separate certification for each principal executive officer and principal financial officer of the registrant as required by Rule 30a-2(a) under the Act (17 CFR 270.30a-2(a)), exactly as set forth below: