Vanguard International Growth Fund · Vanguard International Growth Fund Investment Advisors Fund Assets Managed Investment Advisor % $ Million Investment Strategy Baillie Gifford

See the inside front cover for important information about accessto your fund’s annual and semiannual shareholder reports.

Annual Report | August 31, 2019

Vanguard International Growth Fund

Contents

Please note: The opinions expressed in this report are just that—informed opinions. They should not be considered promisesor advice. Also, please keep in mind that the information and opinions cover the period through the date on the front of thisreport. Of course, the risks of investing in your fund are spelled out in the prospectus.

Important information about access to shareholder reports

Beginning on January 1, 2021, as permitted by regulations adopted by theSecurities and Exchange Commission, paper copies of your fund’s annual andsemiannual shareholder reports will no longer be sent to you by mail, unless youspecifically request them. Instead, you will be notified by mail each time a reportis posted on the website and will be provided with a link to access the report.

If you have already elected to receive shareholder reports electronically, you will notbe affected by this change and do not need to take any action. You may elect toreceive shareholder reports and other communications from the fund electronicallyby contacting your financial intermediary (such as a broker-dealer or bank) or, if youinvest directly with the fund, by calling Vanguard at one of the phone numbers onthe back cover of this report or by logging on to vanguard.com.

You may elect to receive paper copies of all future shareholder reports freeof charge. If you invest through a financial intermediary, you can contact theintermediary to request that you continue to receive paper copies. If you investdirectly with the fund, you can call Vanguard at one of the phone numbers on theback cover of this report or log on to vanguard.com. Your election to receive papercopies will apply to all the funds you hold through an intermediary or directly withVanguard.

A Note From Our Chairman. . . . . . . . . . . . . . . . . . . . . . . . . . 1

Your Fund’s Performance at a Glance. . . . . . . . . . . . . . . . . . 2

Advisors’ Report. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

About Your Fund’s Expenses. . . . . . . . . . . . . . . . . . . . . . . . . 7

Performance Summary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9

Financial Statements. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

Dear Shareholder,

Recent volatility in financial markets—affecting stocks, bonds, and commodities— has been a good reminder of the wise old adage, “Never keep all your eggs in one basket.” Maintaining balance and diversification in your investment portfolio can help to both limit risk and set you up for long-term success.

It’s understandable why some investors might become complacent after a long market run-up like the one that lifted stock prices, especially U.S. stock prices, in the years following the global financial crisis. But failing to rebalance regularly can leave a portfolio with a much different mix of assets than intended and, often, more risk than intended.

Balance across and diversification within asset classes are powerful tools for managing risk and achieving your investment goals. A portfolio’s allocation will determine a large portion of its long- term return and also the majority of its volatility risk. A well-diversified portfolio is less vulnerable to significant swings in the performance of any one segment of the asset classes in which it invests.

Balance and diversification will never eliminate the risk of loss, nor will they guarantee positive returns in a declining market. But they should reduce the chance that you’ll suffer disproportionate losses in one particular high-flying asset class or sector when it comes back to earth. And exposure to all key market components should give you at least some participation in the sectors that are performing best at any given time.

Vanguard is committed to helping you achieve balance and diversification in your portfolios to help meet your invest-ment goals. We thank you for your continued loyalty.

Sincerely,

Mortimer J. Buckley Chairman and Chief Executive Officer October 1, 2019

A Note From Our Chairman

Tim BuckleyChairman and Chief Executive Officer

1

• For the 12 months ended August 31, 2019, Vanguard International Growth Fund

returned –4.58% for Investor Shares and –4.50% for Admiral Shares. The fund

underperformed its benchmark.

• Market sentiment was dampened by signs of decelerating global growth, flare-ups

in trade disputes, heightened international tensions with Iran, and a lack of agreement

in the United Kingdom on how to exit the European Union.

• Relative to its benchmark, the fund outperformed in the Pacific owing largely to its

holdings in Hong Kong and Japan. It lagged its benchmark in other regions, however,

with stock selection detracting significantly from relative performance in Germany,

Belgium, and China.

• The fund outpaced its benchmark in a majority of industry sectors. Stock selection

in financials and consumer discretionary added value, as did largely avoiding the energy

sector. However, the fund underperformed in other sectors, notably materials, health

care and communication services.

Your Fund’s Performance at a Glance

Market Barometer Average Annual Total Returns

Periods Ended August 31, 2019

One Year Three Years Five Years

Stocks

Russell 1000 Index (Large-caps) 2.49% 12.57% 9.85%

Russell 2000 Index (Small-caps) -12.89 7.89 6.41

Russell 3000 Index (Broad U.S. market) 1.31 12.24 9.60

FTSE All-World ex US Index (International) -3.18 5.97 1.71

Bonds

Bloomberg Barclays U.S. Aggregate Bond Index

(Broad taxable market) 10.17% 3.09% 3.35%

Bloomberg Barclays Municipal Bond Index

(Broad tax-exempt market) 8.72 3.30 3.85

FTSE Three-Month U.S. Treasury Bill Index 2.36 1.47 0.91

CPI

Consumer Price Index 1.75% 2.13% 1.53%

2

3

Advisors’ Report

Vanguard International Growth Fund Investment Advisors

Fund Assets Managed

Investment Advisor % $ Million Investment Strategy

Baillie Gifford Overseas Ltd. 59 21,241 The advisor seeks stocks that can generateabove-average growth in earnings and cashflow, producing a bottom-up, stock-drivenapproach to country and asset allocation. Anin-depth view on each company is measuredagainst the consensus view, leading todiscrepancies and potential opportunities to addvalue.

Schroder InvestmentManagement North America Inc.

40 14,122 Equity analysts located around the world and aninternational team of global sector specialistshelp to identify reasonably priced companieswith strong growth prospects and a sustainablecompetitive advantage.

Cash Investments 1 242 These short-term reserves are invested byVanguard in equity index products to simulateinvestment in stocks. Each advisor may alsomaintain a modest cash position.

For the 12 months ended August 31, 2019, Vanguard International Growth Fund returned –4.58% for Investor Shares and –4.50% for Admiral Shares. It lagged its benchmark index (–3.27%). Your fund is managed by two independent advisors, a strategy that enhances the fund’s diversification by providing exposure to distinct yet complementary investment approaches. It is not uncommon for advisors to have different views about individual securities or the broader investment environment.

The advisors, the amount and percentage of fund assets each manages, and brief descriptions of their investment strategies are presented in the table below. The advisors have also prepared a discussion

of the investment environment that existed during the fiscal year and of how the portfolio’s positioning reflects this assessment. These comments were prepared on September 23, 2019.

Baillie Gifford Overseas Ltd.

Portfolio Managers:

James K. Anderson, Head of Global Equities, Partner

Thomas Coutts Head of International Growth, Partner

We believe successful investing lies in finding exceptional and durable growth companies. But growth investing isn’t easy; more ideas will fail than succeed.

4

These companies are hard to find and can be hard to hold, especially in the current environment. In times of macroeconomic uncertainty, we focus on decades, not quarters, and we are patient.

Companies are seizing on an unprecedented explosion of technology-driven innovation. Despite market uncertainty, they are growing by creating products and services that are being adopted more quickly than ever. Why? Because we are more connected. Enabled by increasing computing power, humans now create rich seams of data, presenting innovators with opportunities to mine and exploit them. New companies are using this data to create sectors such as online food delivery, tailored personal finance, and autonomous electric vehicles. Almost every facet of consumer behavior is affected, and consumer demand is setting the pace. As companies are spawned from this disruption, we aim to pick the best of them.

Many holdings that contributed well over the period are long-term leaders in their sectors and heavy investors in R&D. ASML, the Dutch manufacturer of semiconductor machines, is a unique example. Its extreme ultraviolet (EUV) lithography allows the progression of Moore’s Law to continue, and a monopolistic position in the technol-ogy gives considerable pricing power. We believe ASML’s investment in developing this commercially proven system will pay dividends as EUV lithography helps develop the next wave of chips for AI, autonomous driving, 5G, and more.

Another contributor was Argentinian e-commerce platform MercadoLibre, the market leader in Latin America, which has grown its revenues by 48% this fiscal year. The opportunity remains large on a continent of some 650 million people with underpenetrated internet, e-commerce, and financial services markets.

Ferrari still leads in the luxury super-sport segment, with strong demand from existing and new buyers. The company is laser-focused on careful supply management and continues to grow both volume and margins.

Results were weaker for Chinese web search portal Baidu and South Korean biosimilar drug company Celltrion. Despite increasing revenue by 15% for the 12 months, Baidu reported its first quarterly loss in 14 years because of increased R&D costs and content acquisition for its online video platform iQiyi. Celltrion detracted as intensifying competition led to margin erosion. Celltrion has been a long-term contributor to the fund and we remain excited by its lucrative drug pipeline in this nascent market. Overall, we are patient in the short-term and buoyed by the determination of both companies to invest heavily for the future.

Appreciating the rapid change we are seeing in China, we added an IPO to our existing unlisted holding in online marketplace company Meituan-Dianping and participated in the IPO of electric vehicle company NIO. Another addition

5

at IPO was Jumia, the pan-African digital retail company. Finally, after getting to know Temenos, we took a holding in this global leader of banking software.

To fund these purchases, we sold Distribuidora Internacional de Alimentacion (DIA), Jeronimo Martins, and Standard Chartered, where the growth opportunities have diminished. We sold Epiroc and Puma, which were spun out of existing holdings. We also sold Chinese education company New Oriental. As the education market consolidates in China, our conviction has grown stronger for the digital offering from the other large player, TAL Education.

Schroder Investment Management North America Inc.

Portfolio Manager:

Simon Webber, CFA

International equities declined modestly over the period as investors continued to grapple with slowing economic growth and political uncertainty. Trade and broader relationship tensions between the U.S. and China took a toll on business confidence. Manufacturing and industrial sectors were particularly affected as many investment plans were put on hold. Central bank policy broadly turned to supportive measures, and a widespread global collapse in bond yields created a two-tier equity market. “Bond proxy” sectors such as consumer staples performed strongly, but economic cyclicals faced intense pressure.

Stock selection supported relative performance through the year, with particularly strong contributions from holdings in the financial, industrial, and consumer staples sectors. By region, our emerging-market and U.K. exposures contributed, while our European positions detracted.

Our position in Nestle helped. The food and drink producer continues to manage its brand portfolio proactively, focusing investment on high-growth categories and addressing low-growth businesses through product innovation and divestitures. We believe the refocused product range will have better pricing power and, combined with an extensive cost-cutting scheme, should expand group-level margins materially by 2020.

Umicore was a weaker holding. The group issued a cautious outlook in April, citing tough market conditions as reductions in Chinese electric vehicle (EV) subsidies led to slowing demand for Umicore’s cathode materials. Although the company faces tough operating conditions in the short-term, EV demand will likely grow as much as tenfold around the world in the next decade, and Umicore is well-placed to benefit.

In health care, we initiated a position in Roche; we believe the market is underesti-mating the strength of its pipeline. Oncology is its biggest driver, and the company is at the forefront of medical advances that will transform the treatment of cancer and

6

Alzheimer’s. We believe that new product launches coupled with management cost discipline will drive margin expansion.

The portfolio is well-balanced and diversified across cyclical and defensive sectors of the economy. And it is focused on individual companies whose future growth, we are convinced, will surprise the market on the upside.

We remain concerned about market complacency regarding financial leverage amid record-low interest rates. The portfolio in aggregate is invested in companies with significantly stronger balance sheets than the market average. This gives our holdings the ability to react decisively to an uncertain market environment by investing in their own businesses or making acquisitions when opportunities arise.

In contrast, many listed companies are struggling under a combination of relatively high debt and high dividend payout ratios, which constrains their ability to invest and weakens their business in the long term. We focus on choosing stocks with strong and sustainable return-on-capital, resilient balance sheets, and good cash-flow generation. It is increasingly important for companies to have elements of pricing power and self-help; those dependent on macro support alone are unlikely to deliver in the current economic slowdown. We expect firms with these characteristics to have greater resiliency and flexibility to adapt to the evolving competitive landscape.

About Your Fund’s Expenses

7

As a shareholder of the fund, you incur ongoing costs, which include costs for portfolio management, administrative services, and shareholder reports (like this one), among others. Operating expenses, which are deducted from a fund’s gross income, directly reduce the investment return of the fund.

A fund’s expenses are expressed as a percentage of its average net assets. This figure is known as the expense ratio. The following examples are intended to help you understand the ongoing costs (in dollars) of investing in your fund and to compare these costs with those of other mutual funds. The examples are based on an investment of $1,000 made at the beginning of the period shown and held for the entire period.

The accompanying table illustrates your fund’s costs in two ways:

• Based on actual fund return. This section helps you to estimate the actual expenses that you paid over the period. The ”Ending Account Value“ shown is derived from the fund‘s actual return, and the third column shows the dollar amount that would have been paid by an investor who started with $1,000 in the fund. You may use the information here, together with the amount you invested, to estimate the expenses that you paid over the period.

To do so, simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number given for your fund under the heading ”Expenses Paid During Period.“

• Based on hypothetical 5% yearly return. This section is intended to help you compare your fund‘s costs with those of other mutual funds. It assumes that the fund had a yearly return of 5% before expenses, but that the expense ratio is unchanged. In this case—because the return used is not the fund’s actual return—the results do not apply to your investment. The example is useful in making comparisons because the Securities and Exchange Commission requires all mutual funds to calculate expenses based on a 5% return. You can assess your fund’s costs by comparing this hypothetical example with the hypothetical examples that appear in shareholder reports of other funds.

Note that the expenses shown in the table are meant to highlight and help you compare ongoing costs only and do not reflect transaction costs incurred by the fund for buying and sellingsecurities. Further, the expenses do not include any purchase, redemption, or account servicefees described in the fund prospectus. If such fees were applied to your account, your costswould be higher. Your fund does not carry a “sales load.”

The calculations assume no shares were bought or sold during the period. Your actual costs mayhave been higher or lower, depending on the amount of your investment and the timing of anypurchases or redemptions.

You can find more information about the fund’s expenses, including annual expense ratios, in theFinancial Statements section of this report. For additional information on operating expenses andother shareholder costs, please refer to your fund’s current prospectus.

8

Six Months Ended August 31, 2019

International Growth Fund

BeginningAccount Value

2/28/2019

EndingAccount Value

8/31/2019

ExpensesPaid During

Period

Based on Actual Fund Return

Investor Shares $1,000.00 $1,004.97 $2.07

Admiral™ Shares 1,000.00 1,005.25 1.62

Based on Hypothetical 5% Yearly Return

Investor Shares $1,000.00 $1,023.14 $2.09

Admiral Shares 1,000.00 1,023.59 1.63

The calculations are based on expenses incurred in the most recent six-month period. The fund’s annualized six-month expense ratios forthat period are 0.41% for Investor Shares and 0.32% for Admiral Shares. The dollar amounts shown as “Expenses Paid” are equal to theannualized expense ratio multiplied by the average account value over the period, multiplied by the number of days in the most recentsix-month period, then divided by the number of days in the most recent 12-month period (184/365).

All of the returns in this report represent past performance, which is not a guarantee of future results that may be achieved by the fund. (Current performance may be lower or higher thanthe performance data cited. For performance data current to the most recent month-end, visitour website at vanguard.com/performance.) Note, too, that both investment returns and principal value can fluctuate widely, so an investor’s shares, when sold, could be worth more or less than their original cost. The returns shown do not reflect taxes that a shareholder would pay on fund distributions or on the sale of fund shares.

Performance Summary

See Financial Highlights for dividend and capital gains information.


9

Cumulative Performance: August 31, 2009, Through August 31, 2019Initial Investment of $10,000

2019201820172016201520142013201220112010

$26,000

6,000

21,878

Average Annual Total ReturnsPeriods Ended August 31, 2019

OneYear

FiveYears

TenYears

Final Valueof a $10,000Investment

International Growth Fund InvestorShares -4.58% 5.81% 8.14% $21,878

• • • • • • • • Spliced International Index -3.27 1.37 4.14 14,998

Spliced International Index: MSCI EAFE Index through May 31, 2010; MSCI All Country World Index ex USA thereafter.

OneYear

FiveYears

TenYears

Final Valueof a $50,000Investment

International Growth Fund Admiral Shares -4.50% 5.95% 8.28% $110,784

Spliced International Index -3.27 1.37 4.14 74,989

Sector DiversificationAs of August 31, 2019


10

Communication Services 10.6%

Consumer Discretionary 33.8

Consumer Staples 6.5

Energy 1.3

Financials 13.7

Health Care 11.3

Industrials 9.3

Information Technology 9.3

Materials 3.6

Other 0.6

Real Estate 0.0

Utilities 0.0

The table reflects the fund’s equity exposure, based on its invest-ments in stocks and stock index futures. Any holdings in short-termreserves are excluded. Sector categories are based on the GlobalIndustry Classification Standard (“GICS”), except for the “Other”category (if applicable), which includes securities that have notbeen provided a GICS classification as of the effective reportingperiod.

The Global Industry Classification Standard (“GICS”) was developed by and is the exclusive property and a service mark of MSCI Inc. (“MSCI”) and Standard and Poor’s, a division of McGraw-Hill Companies, Inc. (“S&P”), and is licensed for use by Vanguard. Neither MSCI, S&P nor any third party involved in making or compiling the GICS or any GICS classification makes any express or implied warranties or representations with respect to such standard or classification (or the results to be obtained by the use thereof), and all such parties hereby expressly disclaim all warranties of originality, accuracy, completeness, merchantability or fitness for a particular purpose with respect to any such standard or classification. Without limiting any of the foregoing, in no event shall MSCI, S&P, any of its affiliates or any third party involved in making or compiling the GICS or any GICS classification have any liability for any direct, indirect, special, punitive, consequential or any other damages (including lost profits) even if notified of the possibility of such damages.

Financial Statements

Statement of Net AssetsAs of August 31, 2019


Market

Value•

Shares ($000)

Market

Value•

Shares ($000)

Common Stocks (98.5%)1

Australia (0.3%)

Brambles Ltd. 14,789,660 112,411

Austria (0.4%)

Erste Group Bank AG 4,310,170 138,635

Belgium (1.0%) ^ Umicore SA 11,385,753 362,722

Brazil (0.7%)

B3 SA - Brasil Bolsa

Balcao 11,674,291 126,300

Raia Drogasil SA 5,124,291 113,895

240,195

Canada (1.0%)

Nutrien Ltd. 3,665,128 184,578

Toronto-Dominion Bank 3,133,272 169,913

354,491

China (17.6%) * Alibaba Group Holding

Ltd. ADR 11,394,039 1,994,299

Tencent Holdings Ltd. 41,153,400 1,699,040* TAL Education Group

ADR 18,485,132 658,625* Baidu Inc. ADR 4,633,984 484,112

Ping An Insurance

Group Co. of China

Ltd. 37,534,500 430,634* Meituan Dianping

Class B 32,888,430 311,226* Ctrip.com International

Ltd. ADR 9,001,376 291,465

China Pacific Insurance

Group Co. Ltd. 34,671,200 138,393

China Mengniu Dairy

Co. Ltd. 33,524,000 132,619^,* iQIYI Inc. ADR 3,583,399 65,540^,* NIO Inc. ADR 17,591,617 50,312

6,256,265

Denmark (2.9%) * Genmab A/S 2,594,661 530,400

Vestas Wind Systems

A/S 2,278,474 167,548

Chr Hansen Holding A/S 1,658,818 139,486

Novozymes A/S 2,401,809 102,387^ Ambu A/S Class B 5,449,774 93,438

1,033,259

France (8.0%)

Kering SA 1,535,503 744,032

L’Oreal SA 2,310,130 630,800

Schneider Electric SE 5,203,061 435,832

EssilorLuxottica SA 1,942,580 286,822

Danone SA 3,081,319 276,055

TOTAL SA 5,324,542 265,903

Vivendi SA 7,343,173 205,346

2,844,790

Germany (6.9%) *,2 Zalando SE 10,466,867 519,290*,2 Delivery Hero SE 6,275,610 318,067

Bayerische Motoren

Werke AG 3,349,995 224,051

adidas AG 734,594 217,671

SAP SE 1,667,180 199,025

Infineon Technologies

AG 8,885,472 153,994

BASF SE 2,275,881 150,589^,*,3 HelloFresh SE 10,552,945 137,965

GEA Group AG 5,087,264 137,126

Continental AG 1,057,002 127,558* MorphoSys AG 664,989 78,886*,2 Rocket Internet SE 2,762,933 77,081^,*,3 Jumia Technologies

AG ADR 6,724,836 74,982^,* AIXTRON SE 3,130,112 31,064^,*,3 Home24 SE 1,862,256 6,147

2,453,496

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 as an exhibit to its reports

on Form N-PORT. The fund’s Form N-PORT reports are available on the SEC’s website at

www.sec.gov.

11


Market

Value•

Shares ($000)

Market

Value•

Shares ($000)

Hong Kong (4.2%)

AIA Group Ltd. 123,142,800 1,191,623

Jardine Matheson

Holdings Ltd. 3,239,027 176,130

Hong Kong Exchanges

& Clearing Ltd. 4,767,930 145,512

1,513,265

India (2.3%)

Housing Development

Finance Corp. Ltd. 11,680,736 354,877

HDFC Bank Ltd. 6,437,279 201,245

Zee Entertainment

Enterprises Ltd. 33,638,320 175,648*,§,4 ANI Technologies 166,185 49,455

Larsen & Toubro Ltd. 2,239,483 41,675

822,900

Indonesia (0.4%)

Bank Central Asia

Tbk PT 66,399,100 142,510

Israel (0.3%) * Check Point Software

Technologies Ltd. 1,003,311 108,057

Italy (2.6%)

Ferrari NV 4,745,012 749,239

Fiat Chrysler

Automobiles NV 13,737,294 179,654

928,893

Japan (10.8%)

M3 Inc. 26,545,800 562,610

SMC Corp. 1,428,000 538,362

SoftBank Group Corp. 9,578,400 434,033

Nintendo Co. Ltd. 731,600 276,838

Nidec Corp. 2,080,800 270,764

Bridgestone Corp. 5,745,200 217,579

Recruit Holdings Co.

Ltd. 6,702,200 202,944

Sony Corp. 3,375,700 192,288

Takeda Pharmaceutical

Co. Ltd. 4,806,100 162,042

Sekisui Chemical Co.

Ltd. 10,005,000 143,936

Kubota Corp. 8,488,000 121,612

Pigeon Corp. 3,300,800 119,665

Keyence Corp. 202,000 119,362

Toyota Motor Corp. 1,725,900 113,022

ORIX Corp. 7,045,400 103,955

Murata Manufacturing

Co. Ltd. 2,240,300 93,136^ SBI Holdings Inc. 4,470,400 89,262

Suzuki Motor Corp. 2,218,500 85,412

3,846,822

Netherlands (5.3%)

ASML Holding NV 7,790,064 1,732,576

Koninklijke Philips NV 3,529,779 166,375

1,898,951

Norway (0.7%)

DNB ASA 8,478,225 136,586

Norsk Hydro ASA 38,345,698 120,334

256,920

Other (0.2%) 5 Vanguard FTSE All-World

ex-US ETF 1,128,434 55,124

Singapore (0.4%)

Oversea-Chinese

Banking Corp. Ltd. 19,070,500 146,157

South Korea (1.6%)

Samsung Electronics

Co. Ltd. 6,379,876 232,285^,* Celltrion Inc. 1,695,815 220,573

Samsung SDI Co. Ltd. 560,382 115,733

568,591

Spain (2.9%)

Industria de Diseno

Textil SA 21,245,632 657,427

Banco Bilbao Vizcaya

Argentaria SA 80,169,921 380,341

1,037,768

Sweden (4.4%) * Spotify Technology SA 2,908,470 392,498

Atlas Copco AB Class A 9,836,886 294,107

Kinnevik AB 10,340,628 282,049

Svenska

Handelsbanken AB

Class A 28,108,694 247,665

Assa Abloy AB Class B 7,216,721 150,643

SKF AB 7,055,500 113,905^ Elekta AB Class B 6,427,670 81,872

1,562,739

Switzerland (5.3%)

Nestle SA 5,177,491 581,818

Roche Holding AG 1,909,988 521,924

Novartis AG 2,634,439 237,507

Lonza Group AG 574,461 203,896

Cie Financiere

Richemont SA 2,311,487 179,606

Temenos AG 872,365 146,976

Straumann Holding AG 13,099 10,298

1,882,025

Taiwan (1.0%)

Taiwan Semiconductor

Manufacturing Co. Ltd. 41,599,000 341,804

12


Market

Value•

Shares ($000)

Market

Value•

Shares ($000)

Thailand (0.3%)

Kasikornbank PCL

(Foreign) 22,280,856 116,326

Turkey (0.2%) * Turkiye Garanti

Bankasi AS 39,634,985 60,712

United Kingdom (6.8%)

Rolls-Royce Holdings

plc 46,651,516 438,448

Diageo plc 8,713,257 373,051* Ocado Group plc 19,221,816 303,365

BHP Group plc 8,794,634 190,261

Royal Dutch Shell plc

Class A 6,669,211 185,186

Burberry Group plc 6,851,592 181,337

Smith & Nephew plc 7,487,455 179,423

GlaxoSmithKline plc 6,981,170 145,485

Whitbread plc 2,253,798 120,181

Lloyds Banking Group

plc 170,979,423 104,028

Aviva plc 21,361,017 92,220

Bunzl plc 2,273,703 55,768^,*,2 Aston Martin Lagonda

Global Holdings plc 6,321,596 36,949

Next plc 83,261 6,027

2,411,729

United States (10.0%) * Amazon.com Inc. 669,737 1,189,647* Booking Holdings Inc. 51,269 100,816* Illumina Inc. 2,734,956 769,453* MercadoLibre Inc. 1,706,131 1,014,465

Philip Morris

International Inc. 788,444 56,839^,* Tesla Inc. 1,894,281 427,369

3,558,589

Total Common Stocks

(Cost $25,510,096) 35,056,146

Preferred Stocks (0.4%)

*,§,3,4,6 You & Mr. Jones 44,800,000 127,680*,§,4,6 CureVac GmbH 12,600 19,709

Total Preferred Stocks

(Cost $75,682) 147,389

Temporary Cash Investments (3.5%)1

Money Market Fund (3.4%)7,8 Vanguard Market

Liquidity Fund,

2.249% 12,435,941 1,243,718

Face

Amount

($000)

U.S. Government and Agency Obligations (0.1%)

United States Treasury

Bill, 1.954%, 11/7/19 4,500 4,484

United States Treasury

Bill, 2.135%, 11/14/19 2,400 2,3919 United States Treasury

Bill, 2.048%, 11/21/19 10,000 9,9579 United States Treasury

Bill, 2.082%, 12/26/19 3,500 3,479

20,311

Total Temporary Cash Investments

(Cost $1,263,905) 1,264,029

Total Investments (102.4%)

(Cost $26,849,683) 36,467,564

Other Assets and Liabilities (-2.4%)

Other Assets10 193,194

Liabilities (1,055,559)

(862,365)

Net Assets (100%) 35,605,199

13


Amount

($000)

Amount

($000)

Statement of Assets and Liabilities

Assets

Investments in Securities, at Value

Unaffiliated Issuers 34,821,948

Affiliated Issuers 1,645,616

Total Investments in Securities 36,467,564

Investment in Vanguard 1,731

Receivables for Investment Securities

Sold 45,064

Receivables for Accrued Income 64,710

Receivables for Capital Shares Issued 22,508

Variation Margin Receivable—Futures

Contracts 2,516

Unrealized Appreciation—Forward

Currency Contracts 5,679

Other Assets10 50,986

Total Assets 36,660,758

Liabilities

Payables for Investment Securities

Purchased (31,328)

Collateral for Securities on Loan (943,002)

Payables for Capital Shares Redeemed (13,861)

Payables to Investment Advisor (15,675)

Payables to Vanguard (23,316)

Variation Margin Payable—Futures

Contracts (17)

Unrealized Depreciation—Forward

Currency Contracts (11,097)

Other Liabilities (17,263)

Total Liabilities (1,055,559)

Net Assets (100%) 35,605,199

At August 31, 2019, net assets consisted of:

Amount

($000)

Paid-in Capital 25,853,807

Total Distributable Earnings (Loss) 9,751,392

Net Assets 35,605,199

Investor Shares—Net Assets

Applicable to 249,373,598 outstanding

$.001 par value shares of beneficial

interest (unlimited authorization) 7,056,331

Net Asset Value Per Share—

Investor Shares $28.30

Admiral Shares—Net Assets

Applicable to 317,030,200 outstanding

$.001 par value shares of beneficial

interest (unlimited authorization) 28,548,868

Net Asset Value Per Share—

Admiral Shares $90.05

• See Note A in Notes to Financial Statements.

^ Includes partial security positions on loan to broker-dealers. The total value of securities on loan is $925,745,000.

* Non-income-producing security.

§ Security value determined using significant unobservable inputs.

1 The fund invests a portion of its cash reserves in equity markets through the use of index futures contracts. After giving effect to futures investments, the fund’s effective common stock and temporary cash investment positions represent 99.0% and 3.0%, respectively, of net assets.

2 Security exempt from registration under Rule 144A of the Securities Act of 1933. Such securities may be sold in transactions exempt from registration, normally to qualified institutional buyers. At August 31, 2019, the aggregate value of these securities was $951,387,000, representing 2.7% of net assets.

3 Considered an affiliated company of the fund as the fund owns more than 5% of the outstanding voting securities of such company.

4 Restricted securities totaling $196,844,000, representing 0.6% of net assets. See Restricted Securities table for additional information.

5 Considered an affiliated company of the fund as the issuer is another member of The Vanguard Group.

6 Perpetual security with no stated maturity date.

7 Affiliated money market fund available only to Vanguard funds and certain trusts and accounts managed by Vanguard. Rate shown is the 7-day yield.

8 Includes $943,002,000 of collateral received for securities on loan.

9 Securities with a value of $9,901,000 have been segregated as initial margin for open futures contracts.

10 Cash of $6,030,000 has been segregated as collateral for open forward currency contracts.

ADR—American Depositary Receipt.

14


Restricted Securities as of Period End

Acquisition

Acquisition Cost

Security Name Date ($000)

You & Mr. Jones September 2015 44,800

CureVac GmbH October 2015 30,882

ANI Technologies December 2015 51,748

Derivative Financial Instruments Outstanding as of Period End

Futures Contracts

($000)

Value and

Number of Unrealized

Long (Short) Notional Appreciation

Expiration Contracts Amount (Depreciation)

Long Futures Contracts

Dow Jones EURO STOXX 50 Index September 2019 1,912 71,847 289

Topix Index September 2019 352 50,032 (405)

FTSE 100 Index September 2019 432 37,745 (741)

S&P ASX 200 Index September 2019 271 29,981 (454)

(1,311)

Forward Currency Contracts

Contract Unrealized Unrealized

Settlement Contract Amount (000) Appreciation (Depreciation)

Counterparty Date Receive Deliver ($000) ($000)

Morgan Stanley Capital

Services LLC 9/25/19 EUR 124,013 USD 140,372 — (3,804)

Citibank, N.A. 9/18/19 JPY 12,573,713 USD 116,709 1,809 —

Toronto-Dominion Bank 9/24/19 GBP 64,712 USD 82,482 — (3,656)

Toronto-Dominion Bank 9/24/19 AUD 93,932 USD 64,723 — (1,418)

Citibank, N.A. 9/24/19 EUR 38,013 USD 42,394 — (537)

Citibank, N.A. 9/17/19 JPY 3,281,975 USD 30,883 50 —

Royal Bank of Canada 9/24/19 GBP 22,491 USD 27,366 31 —

Citibank, N.A. 9/23/19 AUD 29,180 USD 19,865 — (200)

JPMorgan Chase Bank, N.A. 9/23/19 AUD 15,796 USD 11,071 — (425)

JPMorgan Chase Bank, N.A. 9/24/19 EUR 9,569 USD 10,705 — (168)

15


Forward Currency Contracts (continued)

Contract Unrealized Unrealized

Settlement Contract Amount (000) Appreciation (Depreciation)

Counterparty Date Receive Deliver ($000) ($000)

Goldman Sachs International 9/24/19 EUR 9,201 USD 10,387 — (255)

Royal Bank of Canada 9/24/19 EUR 8,104 USD 9,031 — (107)


Services LLC 9/24/19 GBP 6,904 USD 8,643 — (233)

Royal Bank of Canada 9/17/19 JPY 726,425 USD 6,865 — (18)

Barclays Bank plc 9/17/19 JPY 687,720 USD 6,402 80 —


Services LLC 9/17/19 JPY 660,450 USD 6,127 98 —

Barclays Bank plc 9/25/19 EUR 2,076 USD 2,349 — (63)

Royal Bank of Canada 9/18/19 JPY 195,842 USD 1,818 28 —

Royal Bank of Canada 9/23/19 AUD 2,072 USD 1,406 — (10)

Bank of America, N.A. 9/24/19 AUD 1,131 USD 779 — (17)

BNP Paribas 9/24/19 GBP 601 USD 750 — (18)

Toronto-Dominion Bank 9/24/19 USD 99,772 EUR 88,642 2,165 —

Barclays Bank plc 9/17/19 USD 74,195 JPY 7,825,940 435 —

UBS AG 9/23/19 USD 49,628 AUD 73,376 178 —

Barclays Bank plc 9/24/19 USD 32,594 GBP 26,768 — (13)

JPMorgan Chase Bank, N.A. 9/24/19 USD 17,048 GBP 14,001 — (7)

Deutsche Bank AG 9/24/19 USD 12,412 EUR 11,143 142 —

Goldman Sachs International 9/24/19 USD 11,070 EUR 9,960 102 —

Royal Bank of Canada 9/24/19 USD 10,472 EUR 9,343 184 —

Citibank, N.A. 9/17/19 USD 10,470 JPY 1,111,825 — (10)

UBS AG 9/24/19 USD 9,971 EUR 8,967 97 —

Royal Bank of Canada 9/17/19 USD 7,777 JPY 827,680 — (24)

Deutsche Bank AG 9/23/19 USD 6,491 AUD 9,579 35 —

UBS AG 9/24/19 USD 5,701 GBP 4,693 — (15)

Goldman Sachs International 9/17/19 USD 5,531 JPY 591,480 — (43)

UBS AG 9/17/19 USD 5,472 JPY 581,880 — (12)

Deutsche Bank AG 9/17/19 USD 5,428 JPY 571,520 42 —

HSBC Bank USA, N.A. 9/24/19 USD 5,246 GBP 4,311 — (5)

Royal Bank of Canada 9/24/19 USD 4,522 GBP 3,744 — (39)

Goldman Sachs International 9/17/19 USD 4,476 JPY 474,400 5 —

Goldman Sachs International 9/24/19 USD 4,193 GBP 3,412 37 —

UBS AG 9/24/19 USD 4,145 GBP 3,378 30 —

Royal Bank of Canada 9/23/19 USD 4,085 AUD 6,005 38 —

Bank of America, N.A. 9/23/19 USD 3,940 AUD 5,795 34 —

16


Forward Currency Contracts (continued)

Contract Unrealized Unrealized Settlement Contract Amount (000) Appreciation (Depreciation)Counterparty Date Receive Deliver ($000) ($000)

Goldman Sachs International 9/23/19 USD 3,580 AUD 5,280 22 —

Barclays Bank plc 9/24/19 USD 3,477 GBP 2,842 15 —

JPMorgan Chase Bank, N.A. 9/24/19 USD 488 GBP 383 22 —

5,679 (11,097)

AUD—Australian dollar.

EUR—euro.

GBP—British pound.

JPY—Japanese yen.

USD—U.S. dollar.

At August 31, 2019, the counterparties had deposited in segregated accounts securities with a value of $1,559,000 in connection with open forward currency contracts. After August 31, 2019, the counterparties posted additional collateral of $1,380,000 in connection with open forward currency contracts as of August 31, 2019.

See accompanying Notes, which are an integral part of the Financial Statements.

17

Year Ended

August 31, 2019

($000)

Investment Income

Income

Dividends—Unaffiliated Issuers1 526,647

Dividends—Affiliated Issuers 1,667

Interest—Unaffiliated Issuers 617

Interest—Affiliated Issuers 11,685

Securities Lending—Net 36,756

Total Income 577,372

Expenses

Investment Advisory Fees—Note B

Basic Fee 49,469

Performance Adjustment 10,483

The Vanguard Group—Note C

Management and Administrative—Investor Shares 17,266

Management and Administrative—Admiral Shares 37,892

Marketing and Distribution—Investor Shares 850

Marketing and Distribution—Admiral Shares 1,588

Custodian Fees 2,200

Auditing Fees 46

Shareholders’ Reports—Investor Shares 125

Shareholders’ Reports—Admiral Shares 233

Trustees’ Fees and Expenses 45

Total Expenses 120,197

Net Investment Income 457,175

Realized Net Gain (Loss)

Investment Securities Sold—Unaffiliated Issuers (13,231)

Investment Securities Sold—Affiliated Issuers 214

Futures Contracts 2,687

Forward Currency Contracts (19,337)

Foreign Currencies (2,595)

Realized Net Gain (Loss) (32,262)

Change in Unrealized Appreciation (Depreciation)

Investment Securities—Unaffiliated Issuers (2,154,205)

Investment Securities—Affiliated Issuers (4,789)

Futures Contracts (434)

Forward Currency Contracts 3,840

Foreign Currencies (1,045)

Change in Unrealized Appreciation (Depreciation) (2,156,633)

Net Increase (Decrease) in Net Assets Resulting from Operations (1,731,720)

1 Dividends are net of foreign withholding taxes of $63,506,000.

Statement of Operations



18

Statement of Changes in Net Assets



Year Ended August 31,

2019 2018

($000) ($000)

Increase (Decrease) in Net Assets

Operations

Net Investment Income 457,175 485,445

Realized Net Gain (Loss) (32,262) 1,574,400

Change in Unrealized Appreciation (Depreciation) (2,156,633) 1,400,252

Net Increase (Decrease) in Net Assets Resulting from Operations (1,731,720) 3,460,097

Distributions

Net Investment Income

Investor Shares (101,822) (66,639)

Admiral Shares (414,446) (217,469)

Realized Capital Gain1

Investor Shares (234,310) —

Admiral Shares (863,521) —

Total Distributions (1,614,099) (284,108)

Capital Share Transactions

Investor Shares (284,833) (426,156)

Admiral Shares 1,992,089 3,661,907

Net Increase (Decrease) from Capital Share Transactions 1,707,256 3,235,751

Total Increase (Decrease) (1,638,563) 6,411,740

Net Assets

Beginning of Period 37,243,762 30,832,022

End of Period 35,605,199 37,243,762

1 Includes fiscal 2019 and 2018 short-term gain distributions totaling $14,449,000 and $0, respectively. Short-term gain distributions are treated as ordinary income dividends for tax purposes.

19

Investor Shares

For a Share Outstanding Year Ended August 31,

Throughout Each Period 2019 2018 2017 2016 2015

Net Asset Value, Beginning of Period $31.23 $28.38 $22.38 $20.83 $23.79

Investment Operations

Net Investment Income .3421 .3811 .2401 .304 .308

Net Realized and Unrealized Gain (Loss)

on Investments (1.941) 2.722 6.028 1.539 (2.774)

Total from Investment Operations (1.599) 3.103 6.268 1.843 (2.466)

Distributions

Dividends from Net Investment Income (.403) (.253) (.268) (.293) (.494)

Distributions from Realized Capital Gains (.928) — — — —

Total Distributions (1.331) (.253) (.268) (.293) (.494)

Net Asset Value, End of Period $28.30 $31.23 $28.38 $22.38 $20.83

Total Return2 -4.58% 10.97% 28.43% 8.95% -10.46%

Ratios/Supplemental Data

Net Assets, End of Period (Millions) $7,056 $8,074 $7,731 $6,700 $7,172

Ratio of Total Expenses to Average Net Assets3 0.43% 0.45% 0.45% 0.46% 0.47%

Ratio of Net Investment Income to

Average Net Assets 1.23% 1.25% 1.01% 1.47% 1.34%

Portfolio Turnover Rate 13% 16% 15% 29% 29%

1 Calculated based on average shares outstanding.

2 Total returns do not include account service fees that may have applied in the periods shown. Fund prospectuses provide information about any applicable account service fees.

3 Includes performance-based investment advisory fee increases (decreases) of 0.03%, 0.03%, 0.03%, 0.04%, and 0.03%.

Financial Highlights



20

Admiral Shares

For a Share Outstanding Year Ended August 31,

Throughout Each Period 2019 2018 2017 2016 2015

Net Asset Value, Beginning of Period $99.45 $90.24 $71.19 $66.28 $75.70

Investment Operations

Net Investment Income 1.2031 1.3651 .8791 1.062 1.088

Net Realized and Unrealized Gain (Loss)

on Investments (6.230) 8.652 19.127 4.877 (8.821)

Total from Investment Operations (5.027) 10.017 20.006 5.939 (7.733)

Distributions

Dividends from Net Investment Income (1.418) (.807) (.956) (1.029) (1.687)

Distributions from Realized Capital Gains (2.955) — — — —

Total Distributions (4.373) (.807) (.956) (1.029) (1.687)

Net Asset Value, End of Period $90.05 $99.45 $90.24 $71.19 $66.28

Total Return2 -4.50% 11.14% 28.57% 9.07% -10.32%

Ratios/Supplemental Data

Net Assets, End of Period (Millions) $28,549 $29,170 $23,101 $15,704 $13,752

Ratio of Total Expenses to Average Net Assets3 0.32% 0.32% 0.32% 0.33% 0.34%

Ratio of Net Investment Income to

Average Net Assets 1.34% 1.38% 1.14% 1.60% 1.47%

Portfolio Turnover Rate 13% 16% 15% 29% 29%

1 Calculated based on average shares outstanding.

2 Total returns do not include account service fees that may have applied in the periods shown. Fund prospectuses provide information about any applicable account service fees.

3 Includes performance-based investment advisory fee increases (decreases) of 0.03%, 0.03%, 0.03%, 0.04%, and 0.03%.

Financial Highlights



21

Notes to Financial Statements


Vanguard International Growth Fund is registered under the Investment Company Act of 1940 as

an open-end investment company, or mutual fund. The fund invests in securities of foreign issuers,

which may subject it to investment risks not normally associated with investing in securities of U.S.

corporations. The fund offers two classes of shares: Investor Shares and Admiral Shares. Each of

the share classes has different eligibility and minimum purchase requirements, and is designed for

different types of investors.

A. The following significant accounting policies conform to generally accepted accounting principles

for U.S. investment companies. The fund consistently follows such policies in preparing its financial

statements.

1. Security Valuation: Securities are valued as of the close of trading on the New York Stock Exchange

(generally 4 p.m., Eastern time) on the valuation date. Equity securities are valued at the latest quoted

sales prices or official closing prices taken from the primary market in which each security trades;

such securities not traded on the valuation date are valued at the mean of the latest quoted bid and

asked prices. Securities for which market quotations are not readily available, or whose values have

been affected by events occurring before the fund’s pricing time but after the close of the securities’

primary markets, are valued at their fair values calculated according to procedures adopted by the

board of trustees. These procedures include obtaining quotations from an independent pricing

service, monitoring news to identify significant market- or security-specific events, and evaluating

changes in the values of foreign market proxies (for example, ADRs, futures contracts, or exchange-

traded funds), between the time the foreign markets close and the fund’s pricing time. When fair-

value pricing is employed, the prices of securities used by a fund to calculate its net asset value

may differ from quoted or published prices for the same securities. Investments in Vanguard

Market Liquidity Fund are valued at that fund’s net asset value. Temporary cash investments are

valued using the latest bid prices or using valuations based on a matrix system (which considers

such factors as security prices, yields, maturities, and ratings), both as furnished by independent

pricing services.

2. Foreign Currency: Securities and other assets and liabilities denominated in foreign currencies

are translated into U.S. dollars using exchange rates obtained from an independent third party as

of the fund’s pricing time on the valuation date. Realized gains (losses) and unrealized appreciation

(depreciation) on investment securities include the effects of changes in exchange rates since the

securities were purchased, combined with the effects of changes in security prices. Fluctuations

in the value of other assets and liabilities resulting from changes in exchange rates are recorded as

unrealized foreign currency gains (losses) until the assets or liabilities are settled in cash, at which

time they are recorded as realized foreign currency gains (losses).

3. Futures and Forward Currency Contracts: The fund uses index futures contracts to a limited extent,

with the objective of maintaining full exposure to the stock market while maintaining liquidity. The

fund may purchase or sell futures contracts to achieve a desired level of investment, whether to

accommodate portfolio turnover or cash flows from capital share transactions. The primary risks

associated with the use of futures contracts are imperfect correlation between changes in market

values of stocks held by the fund and the prices of futures contracts, and the possibility of an illiquid

market. Counterparty risk involving futures is mitigated because a regulated clearinghouse is the

counterparty instead of the clearing broker. To further mitigate counterparty risk, the fund trades

futures contracts on an exchange, monitors the financial strength of its clearing brokers and

22


clearinghouse, and has entered into clearing agreements with its clearing brokers. The clearinghouse

imposes initial margin requirements to secure the fund’s performance and requires daily settlement

of variation margin representing changes in the market value of each contract. Any assets pledged

as initial margin for open contracts are noted in the Statement of Net Assets.

The fund enters into forward currency contracts to provide the appropriate currency exposure

related to any open futures contracts or to protect the value of securities and related receivables

and payables against changes in foreign exchange rates. The fund’s risks in using these contracts

include movement in the values of the foreign currencies relative to the U.S. dollar and the ability

of the counterparties to fulfill their obligations under the contracts. The fund mitigates its counter-

party risk by entering into forward currency contracts only with a diverse group of prequalified

counterparties, monitoring their financial strength, entering into master netting arrangements

with its counterparties, and requiring its counterparties to transfer collateral as security for their

performance. In the absence of a default, the collateral pledged or received by the fund cannot be

repledged, resold, or rehypothecated. The master netting arrangements provide that, in the event

of a counterparty’s default (including bankruptcy), the fund may terminate the forward currency

contracts, determine the net amount owed by either party in accordance with its master netting

arrangements, and sell or retain any collateral held up to the net amount owed to the fund under

the master netting arrangements. The forward currency contracts contain provisions whereby a

counterparty may terminate open contracts if the fund’s net assets decline below a certain level,

triggering a payment by the fund if the fund is in a net liability position at the time of the termination.

The payment amount would be reduced by any collateral the fund has pledged. Any assets pledged

as collateral for open contracts are noted in the Statement of Net Assets. The value of collateral

received or pledged is compared daily to the value of the forward currency contracts exposure

with each counterparty, and any difference, if in excess of a specified minimum transfer amount,

is adjusted and settled within two business days.

Futures contracts are valued at their quoted daily settlement prices. Forward currency contracts are

valued at their quoted daily prices obtained from an independent third party, adjusted for currency

risk based on the expiration date of each contract. The notional amounts of the contracts are not

recorded in the Statement of Net Assets. Fluctuations in the value of the contracts are recorded in

the Statement of Assets and Liabilities as an asset (liability) and in the Statement of Operations as

unrealized appreciation (depreciation) until the contracts are closed, when they are recorded as

realized gains (losses) on futures or forward currency contracts.

During the year ended August 31, 2019, the fund’s average investments in long and short futures

contracts represented less than 1% and 0% of net assets, respectively, based on the average of

the notional amounts at each quarter-end during the period. The fund’s average investment in

forward currency contracts represented 1% of net assets, based on the average of the notional

amounts at each quarter-end during the period.

4. Federal Income Taxes: The fund intends to continue to qualify as a regulated investment company

and distribute all of its taxable income. Management has analyzed the fund’s tax positions taken for

all open federal income tax years (August 31, 2016–2019), and has concluded that no provision for

federal income tax is required in the fund’s financial statements.

23


5. Distributions: Distributions to shareholders are recorded on the ex-dividend date. Distributions

are determined on a tax basis and may differ from net investment income and realized capital gains

for financial reporting purposes.

6. Securities Lending: To earn additional income, the fund lends its securities to qualified institutional

borrowers. Security loans are subject to termination by the fund at any time, and are required to

be secured at all times by collateral in an amount at least equal to the market value of securities

loaned. Daily market fluctuations could cause the value of loaned securities to be more or less than

the value of the collateral received. When this occurs, the collateral is adjusted and settled before

the opening of the market on the next business day. The fund further mitigates its counterparty

risk by entering into securities lending transactions only with a diverse group of prequalified

counterparties, monitoring their financial strength, and entering into master securities lending

agreements with its counterparties. The master securities lending agreements provide that, in the

event of a counterparty’s default (including bankruptcy), the fund may terminate any loans with that

borrower, determine the net amount owed, and sell or retain the collateral up to the net amount

owed to the fund; however, such actions may be subject to legal proceedings. While collateral

mitigates counterparty risk, in the event of a default, the fund may experience delays and costs

in recovering the securities loaned. The fund invests cash collateral received in Vanguard Market

Liquidity Fund, and records a liability in the Statement of Assets and Liabilities for the return of the

collateral, during the period the securities are on loan. Securities lending income represents fees

charged to borrowers plus income earned on invested cash collateral, less expenses associated

with the loan. During the term of the loan, the fund is entitled to all distributions made on or in

respect of the loaned securities.

7. Credit Facility: The fund and certain other funds managed by The Vanguard Group (“Vanguard”)

participate in a $4.3 billion committed credit facility provided by a syndicate of lenders pursuant to

a credit agreement that may be renewed annually; each fund is individually liable for its borrowings,

if any, under the credit facility. Borrowings may be utilized for temporary and emergency purposes,

and are subject to the fund’s regulatory and contractual borrowing restrictions. The participating

funds are charged administrative fees and an annual commitment fee of 0.10% of the undrawn

amount of the facility; these fees are allocated to the funds based on a method approved by the

fund’s board of trustees and included in Management and Administrative expenses on the fund’s

Statement of Operations. Any borrowings under this facility bear interest at a rate based upon the

higher of the one-month London Interbank Offered Rate, federal funds effective rate, or overnight

bank funding rate plus an agreed-upon spread.

The fund had no borrowings outstanding at August 31, 2019, or at any time during the period

then ended.

8. Other: Dividend income is recorded on the ex-dividend date. Interest income includes income

distributions received from Vanguard Market Liquidity Fund and is accrued daily. Premiums and

discounts on debt securities purchased are amortized and accreted, respectively, to interest income

over the lives of the respective securities. Security transactions are accounted for on the date

securities are bought or sold. Costs used to determine realized gains (losses) on the sale of

investment securities are those of the specific securities sold.

24

25


Withholding taxes on foreign dividends and capital gains have been provided for in accordance with the fund’s understanding of the applicable countries’ tax rules and rates. The fund has filed tax reclaims for previously withheld taxes on dividends earned in certain European Union countries. These filings are subject to various administrative and judicial proceedings within these countries. Such tax reclaims received during the year, if any, are included in dividend income. No other amounts for additional tax reclaims are reflected in the financial statements due to their uncertainty as to the ultimate resolution of proceedings, the likelihood of receipt of these reclaims, and the potential timing of payment.

Each class of shares has equal rights as to assets and earnings, except that each class separately bears certain class-specific expenses related to maintenance of shareholder accounts (included in Management and Administrative expenses) and shareholder reporting. Marketing and distribution expenses are allocated to each class of shares based on a method approved by the board of trustees. Income, other non-class-specific expenses, and gains and losses on investments are allocated to each class of shares based on its relative net assets.

B. The investment advisory firms Baillie Gifford Overseas Ltd. and Schroder Investment Management North America Inc. each provide investment advisory services to a portion of the fund for a fee calculated at an annual percentage rate of average net assets managed by the advisor. The basic fee of Baillie Gifford Overseas Ltd. and Schroder Investment Management North America Inc. are subject to quarterly adjustments based on performance relative to the MSCI All Country World Index ex USA for the preceding three years.

Vanguard manages the cash reserves of the fund as described below.

For the year ended August 31, 2019, the aggregate investment advisory fee represented an effective annual basic rate of 0.14% of the fund’s average net assets, before an increase of $10,483,000 (0.03%) based on performance.

C. In accordance with the terms of a Funds’ Service Agreement (the “FSA”) between Vanguard and the fund, Vanguard furnishes to the fund investment advisory, corporate management, administrative, marketing, and distribution services at Vanguard’s cost of operations (as defined by the FSA). These costs of operations are allocated to the fund based on methods and guidelines approved by the board of trustees. Vanguard does not require reimbursement in the current period for certain costs of operations (such as deferred compensation/benefits and risk/insurance costs); the fund’s liability for these costs of operations is included in Payables to Vanguard on the Statement of Assets and Liabilities. All other costs of operations payable to Vanguard are generally settled twice a month.

Upon the request of Vanguard, the fund may invest up to 0.40% of its net assets as capital in Vanguard. At August 31, 2019, the fund had contributed to Vanguard capital in the amount of $1,731,000, representing less than 0.01% of the fund’s net assets and 0.69% of Vanguard’s capital received pursuant to the FSA. The fund’s trustees and officers are also directors and employees, respectively, of Vanguard.

D. Various inputs may be used to determine the value of the fund’s investments. These inputs are summarized in three broad levels for financial statement purposes. The inputs or methodologies used to value securities are not necessarily an indication of the risk associated with investing in those securities.


Level 1—Quoted prices in active markets for identical securities. Level 2—Other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.). Level 3—Significant unobservable inputs (including the fund’s own assumptions used to determine the fair value of investments). Any investments valued with significant unobservable inputs are noted on the Statement of Net Assets.

The following table summarizes the market value of the fund’s investments and derivatives as of August 31, 2019, based on the inputs used to value them:

Level 1 Level 2 Level 3 Investments ($000) ($000) ($000)

Common Stocks—North and South America 4,153,275 — —

Common Stocks—Other 4,175,014 26,678,402 49,455

Preferred Stocks — — 147,389

Temporary Cash Investments 1,243,718 20,311 —

Futures Contracts—Assets1 2,516 — —

Futures Contracts—Liabilities1 (17) — —

Forward Currency Contracts—Assets — 5,679 —

Forward Currency Contracts—Liabilities — (11,097) —

Total 9,574,506 26,693,295 196,844

1 Represents variation margin on the last day of the reporting period.

E. At August 31, 2019, the fair values of derivatives were reflected in the Statement of Assets and Liabilities as follows:

Foreign Equity Exchange Contracts Contracts Total Statement of Assets and Liabilities Caption ($000) ($000) ($000)

Variation Margin Receivable—Futures Contracts 2,516 — 2,516

Unrealized Appreciation—Forward Currency Contracts — 5,679 5,679

Total Assets 2,516 5,679 8,195

Variation Margin Payable—Futures Contracts (17) — (17)

Unrealized Depreciation—Forward Currency Contracts — (11,097) (11,097)

Total Liabilities (17) (11,097) (11,114)

26


Realized net gain (loss) and the change in unrealized appreciation (depreciation) on derivatives for

the year ended August 31, 2019, were:

Foreign

Equity Exchange

Contracts Contracts Total

Realized Net Gain (Loss) on Derivatives ($000) ($000) ($000)

Futures Contracts 2,687 — 2,687

Forward Currency Contracts — (19,337) (19,337)

Realized Net Gain (Loss) on Derivatives 2,687 (19,337) (16,650)

Change in Unrealized Appreciation (Depreciation) on Derivatives

Futures Contracts (434) — (434)

Forward Currency Contracts — 3,840 3,840

Change in Unrealized Appreciation (Depreciation) on Derivatives (434) 3,840 3,406

F. Permanent differences between book-basis and tax-basis components of net assets are

reclassified among capital accounts in the financial statements to reflect their tax character.

These reclassifications have no effect on net assets or net asset value per share. As of period

end, permanent differences primarily attributable to the accounting for foreign currency transactions

and passive foreign investment companies were reclassified between the individual components

of total distributable earnings (loss).

Amount

($000)

Paid-in Capital —

Total Distributable Earnings (Loss) —

Temporary differences between book-basis and tax-basis components of total distributable

earnings (loss) arise when certain items of income, gain, or loss are recognized in different periods

for financial statement and tax purposes; these differences will reverse at some time in the future.

The differences are primarily related to the tax deferral on wash sales, the realization of unrealized

gains or losses on certain futures contracts, unrealized gains on passive foreign investment

companies and the deferral of post-October capital losses to future periods. As of period end, the

tax-basis components of total distributable earnings (loss) are detailed in the table as follows:

Amount

($000)

Undistributed Ordinary Income 370,642

Undistributed Long-Term Gains —

Capital Loss Carryforwards1 (195,415)

Net Unrealized Gains (Losses) 9,597,187

1 Includes losses of $195,415,000 realized subsequent to October 31, 2018, which are deferred and will be treated as realized for tax purposes in the next fiscal year.

27


As of August 31, 2019, gross unrealized appreciation and depreciation for investments and

derivatives based on cost for U.S. federal income tax purposes were as follows:

Amount

($000)

Tax Cost 26,867,576

Gross Unrealized Appreciation 12,284,290

Gross Unrealized Depreciation (2,685,161)

Net Unrealized Appreciation (Depreciation) 9,599,129

G. During the year ended August 31, 2019, the fund purchased $5,214,820,000 of investment

securities and sold $4,648,035,000 of investment securities, other than temporary cash investments.

H. Capital share transactions for each class of shares were:

Year Ended August 31,

2019 2018

Amount Shares Amount Shares

($000) (000) ($000) (000)

Investor Shares

Issued 945,569 33,667 2,130,616 68,838

Issued in Lieu of Cash Distributions 322,714 12,842 64,011 2,138

Redeemed (1,553,116) (55,661) (2,620,783) (84,901)

Net Increase (Decrease)—Investor Shares (284,833) (9,152) (426,156) (13,925)

Admiral Shares

Issued 5,613,299 63,290 7,766,732 78,708

Issued in Lieu of Cash Distributions 1,174,401 14,695 199,790 2,098

Redeemed (4,795,611) (54,277) (4,304,615) (43,465)

Net Increase (Decrease)—Admiral Shares 1,992,089 23,708 3,661,907 37,341

28


I. Certain of the fund’s investments are in companies that are considered to be affiliated companies

of the fund because the fund owns more than 5% of the outstanding voting securities of the

company or the issuer is another member of The Vanguard Group. Transactions during the period

in securities of these companies were as follows:

Current Period Transactions

Aug. 31, Proceeds Realized Aug. 31,

2018 from Net Change in Capital Gain 2019

Market Purchases Securities Gain Unrealized Distributions Market

Value at Cost Sold (Loss) App. (Dep.) Income Received Value

($000) ($000) ($000) ($000) ($000) ($000) ($000) ($000)

HelloFresh SE 150,128 — — — (12,163) — — 137,965

Home 24 SE NA1 — — — (47,981) — — 6,147

Jumia Technologies

AG ADR — 97,510 — — (22,528) — — 74,982

Vanguard FTSE

All-World ex-US ETF 58,780 — — — (3,656) 1,667 — 55,124

Vanguard Market

Liquidity Fund 956,789 NA2 NA2 214 (87) 11,685 — 1,243,718

You & Mr. Jones 46,054 — — — 81,626 — — 127,680

Total 1,211,751 214 (4,789) 13,352 — 1,645,616

1 Not applicable—at August 31, 2018, the issuer was not an affiliated company of the fund.

2 Not applicable—purchases and sales are for temporary cash investment purposes.

J. Management has determined that no events or transactions occurred subsequent to August 31,

2019, that would require recognition or disclosure in these financial statements.

29

To the Board of Trustees of Vanguard World Fund and Shareholders of Vanguard International

Growth Fund

Opinion on the Financial Statements

We have audited the accompanying statement of net assets and statement of assets and liabilities

of Vanguard International Growth Fund (one of the funds constituting Vanguard World Fund, referred

to hereafter as the “Fund”) as of August 31, 2019, the related statement of operations for the year

ended August 31, 2019, the statement of changes in net assets for each of the two years in the

period ended August 31, 2019, including the related notes, and the financial highlights for each

of the five years in the period ended August 31, 2019 (collectively referred to as the “financial

statements”). In our opinion, the financial statements present fairly, in all material respects, the

financial position of the Fund as of August 31, 2019, the results of its operations for the year then

ended, the changes in its net assets for each of the two years in the period ended August 31,

2019 and the financial highlights for each of the five years in the period ended August 31, 2019

in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility of the Fund’s management. Our responsibility

is to express an opinion on the Fund’s financial statements based on our audits. We are a public

accounting firm registered with the Public Company Accounting Oversight Board (United States)

(“PCAOB”) and are required to be independent with respect to the Fund in accordance with the

U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange

Commission and the PCAOB.

We conducted our audits of these financial statements in accordance with the standards of

the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable

assurance about whether the financial statements are free of material misstatement, whether

due to error or fraud.

Our audits included performing procedures to assess the risks of material misstatement of the

financial statements, whether due to error or fraud, and performing procedures that respond to

those risks. Such procedures included examining, on a test basis, evidence regarding the amounts

and disclosures in the financial statements. Our audits also included evaluating the accounting

principles used and significant estimates made by management, as well as evaluating the overall

presentation of the financial statements. Our procedures included confirmation of securities owned

as of August 31, 2019 by correspondence with the custodians and brokers and by agreement to the

underlying ownership records of the transfer agent; when replies were not received from brokers,

we performed other auditing procedures. We believe that our audits provide a reasonable basis for

our opinion.

/s/PricewaterhouseCoopers LLP

Philadelphia, Pennsylvania

October 18, 2019

We have served as the auditor of one or more investment companies in The Vanguard Group of

Funds since 1975.

Report of Independent Registered Public Accounting Firm

30

Special 2019 tax information (unaudited) for Vanguard International Growth Fund

This information for the fiscal year ended August 31, 2019, is included pursuant to provisions of

the Internal Revenue Code.

The fund distributed $431,456,000 of qualified dividend income to shareholders during the fiscal year.

The fund designates to shareholders foreign source income of $583,834,000 and foreign taxes

paid of $47,060,000. Shareholders will receive more detailed information with their Form 1099-DIV

in January 2020 to determine the calendar-year amounts to be included on their 2019 tax returns.

31

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The People Who Govern Your Fund

The trustees of your mutual fund are there to see that the fund is operated and managed in your

best interests since, as a shareholder, you are a part owner of the fund. Your fund’s trustees also

serve on the board of directors of The Vanguard Group, Inc., which is owned by the Vanguard

funds and provides services to them.

A majority of Vanguard’s board members are independent, meaning that they have no affiliation

with Vanguard or the funds they oversee, apart from the sizable personal investments they have

made as private individuals. The independent board members have distinguished backgrounds

in business, academia, and public service. Each of the trustees and executive officers oversees

212 Vanguard funds.

Information for each trustee and executive officer of the fund appears below. The mailing address

of the trustees and officers is P.O. Box 876, Valley Forge, PA 19482. More information about the

trustees is in the Statement of Additional Information, which can be obtained, without charge,

by contacting Vanguard at 800-662-7447, or online at vanguard.com.

Interested Trustee1

Mortimer J. Buckley

Born in 1969. Trustee since January 2018. Principal

occupation(s) during the past five years and other

experience: chairman of the board (January 2019–

present) of Vanguard and of each of the investment

companies served by Vanguard; chief executive officer

(January 2018–present) of Vanguard; chief executive

officer, president, and trustee (January 2018–present)

of each of the investment companies served by

Vanguard; president and director (2017–present) of

Vanguard; and president (February 2018–present) of

Vanguard Marketing Corporation. Chief investment

officer (2013–2017), managing director (2002–2017),

head of the Retail Investor Group (2006–2012), and

chief information officer (2001–2006) of Vanguard.

Chairman of the board (2011–2017) and trustee

(2009–2017) of the Children’s Hospital of Philadelphia;

trustee (2018–present) of The Shipley School.

Independent Trustees

Emerson U. Fullwood



experience: executive chief staff and marketing officer

for North America and corporate vice president (retired

2008) of Xerox Corporation (document management

products and services). Former president of the

Worldwide Channels Group, Latin America, and

Worldwide Customer Service and executive chief

staff officer of Developing Markets of Xerox. Executive

in residence and 2009–2010 Distinguished Minett

Professor at the Rochester Institute of Technology.

Director of SPX FLOW, Inc. (multi-industry manufac-

turing). Director of the University of Rochester Medical

Center, the Monroe Community College Foundation,

the United Way of Rochester, North Carolina A&T

University, and Roberts Wesleyan College. Trustee

of the University of Rochester.

Amy Gutmann

Born in 1949. Trustee since June 2006. Principal


experience: president (2004–present) of the University

of Pennsylvania. Christopher H. Browne Distinguished

Professor of Political Science, School of Arts and

Sciences, and professor of communication, Annenberg

School for Communication, with secondary faculty

appointments in the Department of Philosophy, School

of Arts and Sciences, and at the Graduate School of

Education, University of Pennsylvania. Trustee of the

National Constitution Center.

F. Joseph Loughrey

Born in 1949. Trustee since October 2009. Principal


experience: president and chief operating officer

(retired 2009) and vice chairman of the board

(2008–2009) of Cummins Inc. (industrial machinery).

Chairman of the board of Hillenbrand, Inc. (specialized

consumer services), and the Lumina Foundation.

1 Mr. Buckley is considered an “interested person,” as defined in the Investment Company Act of 1940, because he is an officer of the Vanguard funds.

Director of the V Foundation and Oxfam America.

Member of the advisory council for the College of

Arts and Letters and chair of the advisory board to

the Kellogg Institute for International Studies, both

at the University of Notre Dame.

Mark Loughridge

Born in 1953. Trustee since March 2012. Principal


experience: senior vice president and chief financial

officer (retired 2013) of IBM (information technology

services). Fiduciary member of IBM’s Retirement

Plan Committee (2004–2013), senior vice president

and general manager (2002–2004) of IBM Global

Financing, vice president and controller (1998–2002)

of IBM, and a variety of other prior management roles

at IBM. Member of the Council on Chicago Booth.

Scott C. Malpass

Born in 1962. Trustee since March 2012. Principal


experience: chief investment officer (1989–present)

and vice president (1996–present) of the University

of Notre Dame. Assistant professor of finance at the

Mendoza College of Business, University of Notre

Dame, and member of the Notre Dame 403(b)

Investment Committee. Chairman of the board of

TIFF Advisory Services, Inc. Member of the board

of Catholic Investment Services, Inc. (investment

advisors) and the board of superintendence

of the Institute for the Works of Religion.

Deanna Mulligan



experience: president (2010–present) and chief

executive officer (2011–present) of The Guardian

Life Insurance Company of America. Chief operating

officer (2010–2011) and executive vice president

(2008–2010) of Individual Life and Disability of

The Guardian Life Insurance Company of America.

Member of the board of The Guardian Life Insurance

Company of America, the American Council of Life

Insurers, the Partnership for New York City (business

leadership), and the Committee Encouraging Corporate

Philanthropy. Trustee of the Economic Club of New

York and the Bruce Museum (arts and science).

Member of the Advisory Council for the Stanford

Graduate School of Business.

André F. Perold

Born in 1952. Trustee since December 2004. Principal


experience: George Gund Professor of Finance and

Banking, Emeritus at the Harvard Business School

(retired 2011). Chief investment officer and co-

managing partner of HighVista Strategies LLC (private

investment firm). Board of advisors and investment

committee member of the Museum of Fine Arts

Boston. Board member (2018–present) of RIT Capital

Partners (investment firm); investment committee

member of Partners Health Care System.

Sarah Bloom Raskin



experience: deputy secretary (2014–2017) of

the United States Department of the Treasury.

Governor (2010–2014) of the Federal Reserve

Board. Commissioner (2007–2010) of financial

regulation for the State of Maryland. Member of

the board of directors (2012–2014) of Neighborhood

Reinvestment Corporation. Director (2017–present)

of i(x) Investments, LLC; director (2017–present)

of Reserve Trust. Rubinstein Fellow (2017–present)

of Duke University; trustee (2017–present) of

Amherst College.

Peter F. Volanakis

Born in 1955. Trustee since July 2009. Principal


experience: president and chief operating officer

(retired 2010) of Corning Incorporated (communications

equipment) and director of Corning Incorporated

(2000–2010) and Dow Corning (2001–2010).

Director (2012) of SPX Corporation (multi-industry

manufacturing). Overseer of the Amos Tuck School

of Business Administration, Dartmouth College

(2001–2013). Chairman of the board of trustees of

Colby-Sawyer College. Member of the board of

Hypertherm Inc. (industrial cutting systems, software,

and consumables).

Executive Officers

Glenn Booraem

Born in 1967. Principal occupation(s) during the past

five years and other experience: principal of Vanguard.

Investment stewardship officer (2017–present),

treasurer (2015–2017), controller (2010–2015),

and assistant controller (2001–2010) of each of

the investment companies served by Vanguard.

Christine M. Buchanan


five years and other experience: principal of Vanguard

and global head of Fund Administration at Vanguard.

Treasurer (2017–present) of each of the investment

companies served by Vanguard. Partner (2005–2017)

at KPMG LLP (audit, tax, and advisory services).

Thomas J. Higgins



Chief financial officer (2008–present) and treasurer

(1998–2008) of each of the investment companies

served by Vanguard.

Peter Mahoney



Controller (2015–present) of each of the investment

companies served by Vanguard. Head of International

Fund Services (2008–2014) at Vanguard.

Anne E. Robinson

Born in 1970. Principal occupation(s) during the

past five years and other experience: general

counsel (2016–present) of Vanguard. Secretary

(2016–present) of Vanguard and of each of the

investment companies served by Vanguard.

Managing director (2016–present) of Vanguard.

Director and senior vice president (2016–2018)

of Vanguard Marketing Corporation. Managing

director and general counsel of Global Cards and

Consumer Services (2014–2016) at Citigroup.

Counsel (2003–2014) at American Express.

Michael Rollings


past five years and other experience: finance

director (2017–present) and treasurer (2017) of each

of the investment companies served by Vanguard.

Managing director (2016–present) of Vanguard. Chief

financial officer (2016–present) of Vanguard. Director

(2016–present) of Vanguard Marketing Corporation.

Executive vice president and chief financial officer

(2006–2016) of MassMutual Financial Group.

John E. Schadl


past five years and other experience: principal of

Vanguard. Chief compliance officer (2019–present)

of Vanguard and of each of the investment companies

served by Vanguard. Assistant vice president (May

2019–present) of Vanguard Marketing Corporation.

Vanguard Senior Management Team

Joseph Brennan Chris D. McIsaac

Mortimer J. Buckley James M. Norris

Gregory Davis Thomas M. Rampulla

John James Karin A. Risi

Martha G. King Anne E. Robinson

John T. Marcante Michael Rollings

P.O. Box 2600Valley Forge, PA 19482-2600

Connect with Vanguard® > vanguard.com

Fund Information > 800-662-7447

Direct Investor Account Services > 800-662-2739

Institutional Investor Services > 800-523-1036

Text Telephone for PeopleWho Are Deaf or Hard of Hearing > 800-749-7273

This material may be used in conjunctionwith the offering of shares of any Vanguardfund only if preceded or accompanied bythe fund’s current prospectus.

All comparative mutual fund data are from Morningstar,Inc., unless otherwise noted.

You can obtain a free copy of Vanguard’s proxy votingguidelines by visiting vanguard.com/proxyreporting or bycalling Vanguard at 800-662-2739. The guidelines arealso available from the SEC’s website, www.sec.gov. Inaddition, you may obtain a free report on how your fundvoted the proxies for securities it owned during the 12months ended June 30. To get the report, visit eithervanguard.com/proxyreporting or www.sec.gov.

You can review information about your fund on theSEC’s website, and you can receive copies of thisinformation, for a fee, by sending a request via emailaddressed to [email protected].

Source for Bloomberg Barclays indexes: BloombergIndex Services Limited. Copyright 2019, Bloomberg. Allrights reserved.

CFA® is a registered trademark owned by CFA Institute.

© 2019 The Vanguard Group, Inc.All rights reserved.Vanguard Marketing Corporation, Distributor.

Q810 102019

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