UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act File Number: 811-04519
T. Rowe Price Capital Appreciation Fund, Inc.
(Exact name of registrant as specified in charter)
100 East Pratt Street, Baltimore, MD 21202
(Address of principal executive offices)
David Oestreicher
100 East Pratt Street, Baltimore, MD 21202
(Name and address of agent for service)
Registrant’s telephone number, including area code: (410) 345-2000
Date of fiscal year end: December 31
Date of reporting period: December 31, 2023
Item 1. Reports to Shareholders
(a) Report pursuant to Rule 30e-1
Highlights
and
Market
Commentary
Management’s
Discussion
of
Fund
Performance
Performance
and
Expenses
Financial
Highlights
Portfolio
of
Investments
Financial
Statements
and
Notes
Additional
Fund
Information
For
more
insights
from
T.
Rowe
Price
investment
professionals,
go
to
troweprice.com
.
T.
ROWE
PRICE
PRCFX
Capital
Appreciation
and
Income
Fund
–
.
PRCHX
Capital
Appreciation
and
Income
Fund–
.
I Class
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
HIGHLIGHTS
The
Capital
Appreciation
and
Income
Fund
underperformed
its
composite
benchmark
(60%
Bloomberg
U.S.
Aggregate
Bond
Index/40%
S&P
500
Index),
from
its
inception
on
November
29,
2023,
through
December
31,
2023.
The
fund’s
sector
and
asset
allocations
detracted
from
relative
returns,
due
in
large
part
to
the
fund’s
allocation
to
bank
debt,
which
lagged
the
broader
fixed
income
universe.
The
portfolio
invests
across
a
range
of
fixed
income
assets
that
typically
comprises
the
majority
of
holdings.
The
portfolio
also
invests
in
equities,
convertible
and
preferred
securities,
and
derivatives.
The
fund
employs
a
flexible
approach
that
allows
us
to
dynamically
allocate
assets
across
the
investment
universe
in
the
pursuit
of
strong
risk-adjusted
returns.
We
identify
investment
opportunities
based
on
our
research
regarding
underlying
corporate
fundamentals,
market
performance,
and
relevant
macroeconomic
considerations.
The
recent
reversal
of
macroeconomic
consensus
is
not
an
anomaly,
as
we
have
seen
it
play
out
in
each
of
the
last
several
years.
While
investing
against
the
grain
can
be
challenging,
we
believe
this
is
one
of
the
greatest
market
inefficiencies
that
we
can
exploit.
By
taking
a
longer
view
than
the
market
and
focusing
on
maximizing
returns
over
the
intermediate
to
long
term
rather
than
the
short
term,
we
believe
we
can
create
differentiated
value
for
our
shareholders.
Log
in
to
your
account
at
troweprice.com
for
more
information.
*
An
account
service
fee
will
be
charged
annually
for
each
T.
Rowe
Price
mutual
fund
account
unless
you
meet
criteria
for
a
fee
waiver.
Go
to
troweprice.com/personal-investing/help/fees-and-
minimums.html
to
learn
more
about
this
account
service
fee,
including
other
ways
to
waive
it.
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
Market
Commentary
Dear
Shareholder
Global
stock
and
bond
indexes
were
broadly
positive
during
2023
as
most
economies
managed
to
avoid
the
recession
that
was
widely
predicted
at
the
start
of
the
year.
Technology
companies
benefited
from
investor
enthusiasm
for
artificial
intelligence
developments
and
led
the
equity
rally,
while
fixed
income
benchmarks
rebounded
late
in
the
year
amid
falling
interest
rates.
For
the
12-month
period,
the
technology-oriented
Nasdaq
Composite
Index
rose
about
43%,
reaching
a
record
high
and
producing
the
strongest
result
of
the
major
benchmarks.
Growth
stocks
outperformed
value
shares,
and
developed
market
stocks
generally
outpaced
their
emerging
markets
counterparts.
Currency
movements
were
mixed
over
the
period,
although
a
weaker
dollar
versus
major
European
currencies
was
beneficial
for
U.S.
investors
in
European
securities.
Within
the
S&P
500
Index,
which
finished
the
year
just
short
of
the
record
level
it
reached
in
early
2022,
the
information
technology,
communication
services,
and
consumer
discretionary
sectors
were
all
lifted
by
the
tech
rally
and
recorded
significant
gains.
A
small
group
of
tech-oriented
mega-cap
companies
helped
drive
much
of
the
market’s
advance.
Conversely,
the
defensive
utilities
sector
had
the
weakest
returns
in
the
growth-focused
environment,
and
the
energy
sector
also
lost
ground
amid
declining
oil
prices.
The
financials
sector
bounced
back
from
the
failure
of
three
large
regional
banks
in
the
spring
and
was
one
of
the
top-performing
segments
in
the
second
half
of
the
year.
The
U.S.
economy
was
the
strongest
among
the
major
markets
during
the
period,
with
gross
domestic
product
growth
coming
in
at
4.9%
in
the
third
quarter,
the
highest
since
the
end
of
2021.
Corporate
fundamentals
were
also
broadly
supportive.
Year-over-year
earnings
growth
contracted
in
the
first
and
second
quarters
of
2023,
but
results
were
better
than
expected,
and
earnings
growth
turned
positive
again
in
the
third
quarter.
Markets
remained
resilient
despite
a
debt
ceiling
standoff
in
the
U.S.,
the
outbreak
of
war
in
the
Middle
East,
the
continuing
conflict
between
Russia
and
Ukraine,
and
a
sluggish
economic
recovery
in
China.
Inflation
remained
a
concern,
but
investors
were
encouraged
by
the
slowing
pace
of
price
increases
as
well
as
the
possibility
that
the
Federal
Reserve
was
nearing
the
end
of
its
rate-hiking
cycle.
The
Fed
held
rates
steady
after
raising
its
short-term
lending
benchmark
rate
to
a
target
range
of
5.25%
to
5.50%
in
July,
the
highest
level
since
March
2001,
and
at
its
final
meeting
of
the
year
in
December,
the
central
bank
indicated
that
there
could
be
three
25-basis-point
rate
cuts
in
2024.
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
The
yield
of
the
benchmark
10-year
U.S.
Treasury
note
briefly
reached
5.00%
in
October
for
the
first
time
since
late
2007
before
falling
back
to
3.88%
by
period-end,
the
same
level
where
it
started
the
year,
amid
cooler-than-expected
inflation
readings
and
less-hawkish
Fed
rhetoric.
Fixed
income
benchmarks
were
lifted
late
in
the
year
by
falling
yields.
Investment-grade
and
high
yield
corporate
bonds
produced
solid
returns,
supported
by
the
higher
coupons
that
have
become
available
over
the
past
year,
as
well
as
increasing
hopes
that
the
economy
might
be
able
to
avoid
a
recession.
Global
economies
and
markets
showed
surprising
resilience
in
2023,
but
considerable
uncertainty
remains
as
we
look
ahead.
Geopolitical
events,
the
path
of
monetary
policy,
and
the
impact
of
the
Fed’s
rate
hikes
on
the
economy
all
raise
the
potential
for
additional
volatility.
We
believe
this
environment
makes
skilled
active
management
a
critical
tool
for
identifying
risks
and
opportunities,
and
our
investment
teams
will
continue
to
use
fundamental
research
to
help
identify
securities
that
can
add
value
to
your
portfolio
over
the
long
term.
Thank
you
for
your
continued
confidence
in
T.
Rowe
Price.
Sincerely,
Robert
Sharps
CEO
and
President
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
Management’s
Discussion
of
Fund
Performance
INVESTMENT
OBJECTIVE
The
fund
seeks
total
return
through
a
combination
of
income
and
capital
appreciation.
FUND
COMMENTARY
How
did
the
fund
perform
since
inception?
The
Capital
Appreciation
and
Income
Fund
returned
3.15%
from
its
inception
on
November
29,
2023,
through
December
31,
2023.
The
fund
underperformed
its
composite
benchmark,
consisting
of
60%
Bloomberg
U.S.
Aggregate
Bond
Index
and
40%
S&P
500
Index,
which
returned
4.06%.
(
Past
performance
cannot
guarantee
future
results.
)
What
factors
influenced
the
fund’s
performance?
The
fund
began
operations
a
little
more
than
a
month
before
the
end
of
the
reporting
period.
Around
that
time,
equity
markets
surged
higher
and
U.S.
Treasury
yields
plunged
as
Federal
Reserve
officials
projected
that
there
could
be
three
quarter-point
interest
rate
cuts
in
2024.
In
fact,
the
10-year
U.S.
Treasury
note
yield,
which
had
reached
the
5.00%
level
in
October
for
the
first
time
in
about
16
years,
dropped
from
4.37%
to
3.88%
in
December.
In
the
short
history
since
inception,
the
fund’s
sector
and
asset
allocations
detracted
from
relative
returns.
Within
fixed
income,
the
fund’s
position
in
bank
debt
was
a
leading
detractor
as
bank
loans
lagged
high
yield
and
investment-grade
debt.
On
the
other
hand,
an
underweight
position
in
government
debt
relative
to
the
benchmark
was
beneficial
during
the
period.
The
fund’s
equity
holdings
produced
positive
returns
and
only
slightly
trailed
the
S&P
500
Index
for
the
period.
Stock
selection
within
information
technology
had
a
slight
negative
effect,
while
the
health
care
sector
had
a
slight
positive
impact
due
to
an
overweight
allocation
and
stock
choices.
(Please
refer
to
the
fund’s
portfolio
of
investments
for
a
complete
list
of
holdings
and
the
amount
each
represents
in
the
portfolio.)
PERFORMANCE
COMPARISON
Total
Return
Periods
Ended
12/31/23
Since
Inception
11/29/23
Capital
Appreciation
and
Income
Fund
–
.
3.15%
Capital
Appreciation
and
Income
Fund–
.
I Class
3.16
Bloomberg
U.S.
Aggregate
Bond
Index
3.45
60%
Bloomberg
U.S.
Aggregate
Bond
Index/40%
S&P
500
Index
4.06
Lipper
Mixed-Asset
Target
Allocation
Conservative
Funds
Index
3.89
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
How
is
the
fund
positioned?
Our
objective
is
to
provide
our
clients
with
superior
risk-
adjusted
returns
while
also
limiting
downside
risk.
We
believe
that
our
commitment
to
fundamental
research
and
our
tested
investment
process
allows
us
to
identify
the
best
opportunities
across
asset
classes
to
meet
our
objectives.
The
strategy
generally
uses
a
contrarian
approach
with
a
quality
bias,
and
it
seeks
companies
whose
stocks
and
other
securities
appear
to
be
undervalued
or
out
of
favor
with
investors.
Our
process
favors
companies
that
allocate
capital
well,
offer
attractive
valuations,
and
have
sound
corporate
fundamentals
while
avoiding
companies
that
face
secular
challenges
or
offer
poor
risk-adjusted
returns.
More
than
half
of
the
fund’s
assets
were
invested
in
bonds
at
the
end
of
the
period,
where
we
primarily
held
U.S.
corporate
bonds
and
Treasuries.
A
little
more
than
a
third
of
the
fund
was
invested
in
the
common
stock
of
U.S.
companies,
which
is
within
the
fund’s
normal
long-term
range
for
this
allocation.
The
fund
also
had
a
notable
position
in
cash,
which
can
be
deployed
to
pursue
attractive
opportunities,
particularly
if
markets
pull
back
from
the
rally
that
left
valuations
across
many
market
segments
extended
as
the
period
drew
to
a
close.
What
is
portfolio
management’s
outlook?
Major
stock
indexes
soared
in
2023,
led
by
a
return
to
favor
for
growth
stocks
and
more
cyclical
segments
of
the
market.
Fixed
income
markets
also
produced
strong
returns,
thanks
to
a
strong
year-end
rally
that
offset
earlier
losses
stemming
from
rising
interest
rates.
High
yield
debt,
in
particular,
enjoyed
a
very
strong
year
and
outperformed
higher-quality
issues.
SECTOR
DIVERSIFICATION
Percent
of
Net
Assets
12/31/23
Information
Technology
9.9%
Health
Care
6.4
Industrials
and
Business
Services
4.6
Financials
4.4
Consumer
Discretionary
3.9
Communication
Services
2.9
Utilities
2.4
Energy
1.1
Consumer
Staples
1.0
Real
Estate
0.7
Materials
0.5
Other
and
Reserves
62.2
Total
100.0%
Historical
weightings
reflect
current
industry/sector
classifications.
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
Market
sentiment
has
improved
as
recession
fears
have
subsided
and
expectations
have
increased
for
the
Federal
Reserve
to
cut
rates
in
2024.
While
a
less
restrictive
monetary
policy
would
likely
be
a
boon
for
markets,
the
recent
rally
has
left
valuations
vulnerable
to
a
pullback,
and
still-elevated
interest
rates
could
pose
a
headwind
to
economic
growth.
A
year
ago,
market
expectations
were
heavily
tilted
toward
a
Fed-induced
recession.
A
year
later,
optimism
fueled
a
risk-on
rally
that
brought
major
indexes
near
record
levels
and
the
potential
upside
in
stocks
waned.
This
reversal
of
macroeconomic
consensus
is
not
an
anomaly,
as
we
have
seen
it
play
out
in
each
of
the
last
several
years.
While
investing
against
the
grain
can
be
challenging,
we
believe
this
is
one
of
the
greatest
market
inefficiencies
that
we
can
exploit.
By
taking
a
longer
view
than
the
market
and
focusing
on
maximizing
returns
over
the
intermediate
to
long
term
rather
than
the
short
term,
we
believe
we
can
create
differentiated
value
for
our
shareholders.
SECURITY
DIVERSIFICATION
Capital
Appreciation
and
Income
Fund
The
views
expressed
reflect
the
opinions
of
T.
Rowe
Price
as
of
the
date
of
this
report
and
are
subject
to
change
based
on
changes
in
market,
economic,
or
other
conditions.
These
views
are
not
intended
to
be
a
forecast
of
future
events
and
are
no
guarantee
of
future
results.
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
RISKS
OF
INVESTING
As
with
all
stock
and
bond
mutual
funds,
the
fund’s
share
price
can
fall
because
of
weakness
in
the
stock
or
bond
markets,
a
particular
industry,
or
specific
holdings.
Stock
markets
can
decline
for
many
reasons,
including
adverse
political
or
economic
developments,
changes
in
investor
psychology,
or
heavy
institutional
selling.
The
prospects
for
an
industry
or
company
may
deteriorate
because
of
a
variety
of
factors,
including
disappointing
earnings
or
changes
in
the
competitive
environment.
In
addition,
the
investment
manager’s
assessment
of
companies
held
in
a
fund
may
prove
incorrect,
resulting
in
losses
or
poor
performance
even
in
rising
markets.
A
sizable
cash
or
fixed
income
position
may
hinder
the
fund
from
participating
fully
in
a
strong,
rapidly
rising
bull
market.
In
addition,
significant
exposure
to
bonds
increases
the
risk
that
the
fund’s
share
value
could
be
hurt
by
rising
interest
rates
or
credit
downgrades
or
defaults.
Convertible
securities
are
also
exposed
to
price
fluctuations
of
the
company’s
stock.
BENCHMARK
INFORMATION
Note:
Bloomberg
®
and Bloomberg
U.S.
Aggregate
Bond
Index
are
service
marks
of
Bloomberg
Finance
L.P.
and
its
affiliates,
including
Bloomberg
Index
Services
Limited
(“BISL”),
the
administrator
of
the
index
(collectively,
“Bloomberg”)
and
have
been
licensed
for
use
for
certain
purposes
by
T.
Rowe
Price.
Bloomberg
is
not
affiliated
with
T.
Rowe
Price,
and
Bloomberg
does
not
approve,
endorse,
review,
or
recommend
its
products.
Bloomberg
does
not
guarantee
the
timeliness,
accurateness,
or
completeness
of
any
data
or
information
relating
to
its
products.
Note:
Portions
of
the
mutual
fund
information
contained
in
this
report
was
supplied
by
Lipper,
a
Refinitiv
Company,
subject
to
the
following:
Copyright
2024
©
Refinitiv.
All
rights
reserved.
Any
copying,
republication
or
redistribution
of
Lipper
content
is
expressly
prohibited
without
the
prior
written
consent
of
Lipper.
Lipper
shall
not
be
liable
for
any
errors
or
delays
in
the
content,
or
for
any
actions
taken
in
reliance
thereon.
Note:
Copyright
©
2024,
S&P
Global
Market
Intelligence
(and
its
affiliates,
as
applicable).
Reproduction
of
any
information,
data
or
material,
including
ratings
(“Content”)
in
any
form
is
prohibited
except
with
the
prior
written
permission
of
the
relevant
party. Such
party,
its
affiliates
and
suppliers
(“Content
Providers”)
do
not
guarantee
the
accuracy,
adequacy,
completeness,
timeliness
or
availability
of
any
Content
and
are
not
responsible
for
any
errors
or
omissions
(negligent
or
otherwise),
regardless
of
the
cause,
or
for
the
results
obtained
from
the
use
of
such
Content.
In
no
event
shall
Content
Providers
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
be
liable
for
any
damages,
costs,
expenses,
legal
fees,
or
losses
(including
lost
income
or
lost
profit
and
opportunity
costs)
in
connection
with
any
use
of
the
Content.
A
reference
to
a
particular
investment
or
security,
a
rating
or
any
observation
concerning
an
investment
that
is
part
of
the
Content
is
not
a
recommendation
to
buy,
sell
or
hold
such
investment
or
security,
does
not
address
the
appropriateness
of
an
investment
or
security
and
should
not
be
relied
on
as
investment
advice.
Credit
ratings
are
statements
of
opinions
and
are
not
statements
of
fact.
BENCHMARK
INFORMATION
(continued)
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
PORTFOLIO
HIGHLIGHTS
TWENTY-FIVE
LARGEST
HOLDINGS
Percent
of
Net
Assets
12/31/23
U.S.
Treasury
Notes
17.2%
Microsoft
2.9
Yum!
Brands
2.6
Apple
2.5
Hilton
domestic
Operating
2.0
Alphabet
1.8
HUB
International
1.7
Applied
Systems
1.7
Amazon.com
1.2
TransDigm
1.1
Gartner
1.1
Filtration
1.1
MSCI
1.1
SBA
Communications
1.0
VICI
Properties
1.0
Severin
Acquisition
1.0
Biogen
0.9
Meta
Platforms
0.9
Avantor
Funding
0.9
SBA
Senior
Finance
II
0.9
UnitedHealth
Group
0.8
UKG
0.8
American
Tower
0.8
Howmet
Aerospace
0.8
USI
0.7
Total
48.5%
Note:
The
information
shown
does
not
reflect
any
exchange-traded
funds
(ETFs),
cash
reserves,
or
collateral
for
securities
lending
that
may
be
held
in
the
portfolio.
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
AVERAGE
ANNUAL
COMPOUND
TOTAL
RETURN
Period
Ended
12/31/23
Since
Inception
11/29/23
Capital
Appreciation
and
Income
Fund
–
.
3.15%*
Capital
Appreciation
and
Income
Fund–
.
I Class
3.16*
The
fund’s
performance
information
represents
only
past
performance
and
is
not
necessarily
an
indication
of
future
results.
Current
performance
may
be
lower
or
higher
than
the
performance
data
cited.
Share
price,
principal
value,
and
return
will
vary,
and
you
may
have
a
gain
or
loss
when
you
sell
your
shares.
For
the
most
recent
month-end
performance,
please
visit
our
website
(troweprice.com)
or
contact
a
T.
Rowe
Price
representative
at
1
-
800
-
225
-
5132
or,
for
0.02
I
Class
shares,
1-800-638-8790.
This
table
shows
how
the
fund
would
have
performed
each
year
if
its
actual
(or
cumulative)
returns
had
been
earned
at
a
constant
rate.
Average
annual
total
return
figures
include
changes
in
principal
value,
reinvested
dividends,
and
capital
gain
distributions.
Returns
do
not
reflect
taxes
that
the
shareholder
may
pay
on
fund
distributions
or
the
redemption
of
fund
shares.
When
assessing
performance,
investors
should
consider
both
short-
and
long-term
returns.
*
Returns
for
periods
of
less
than
one
year
are
not
annualized.
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
EXPENSE
RATIO
FUND
EXPENSE
EXAMPLE
As
a
mutual
fund
shareholder,
you
may
incur
two
types
of
costs:
(1)
transaction
costs,
such
as
redemption
fees
or
sales
loads,
and
(2)
ongoing
costs,
including
management
fees,
distribution
and
service
(12b-1)
fees,
and
other
fund
expenses.
The
following
example
is
intended
to
help
you
understand
your
ongoing
costs
(in
dollars)
of
investing
in
the
fund
and
to
compare
these
costs
with
the
ongoing
costs
of
investing
in
other
mutual
funds.
The
example
is
based
on
an
investment
of
$1,000
invested
at
the
beginning
of
the
most
recent
six-month
period
and
held
for
the
entire
period.
Please
note
that
the
fund
has
two
share
classes:
The
original
share
class
(Investor
Class)
charges
no
distribution
and
service
(12b-1)
fee,
and
the
I
Class
shares
are
also
available
to
institutionally
oriented
clients
and
impose
no
12b-1
or
administrative
fee
payment.
Each
share
class
is
presented
separately
in
the
table.
Actual
Expenses
The
first
line
of
the
following
table
(Actual)
provides
information
about
actual
account
values
and
expenses
based
on
the
fund’s
actual
returns.
You
may
use
the
information
on
this
line,
together
with
your
account
balance,
to
estimate
the
expenses
that
you
paid
over
the
period.
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
on
the
first
line
under
the
heading
“Expenses
Paid
During
Period”
to
estimate
the
expenses
you
paid
on
your
account
during
this
period.
Hypothetical
Example
for
Comparison
Purposes
The
information
on
the
second
line
of
the
table
(Hypothetical)
is
based
on
hypothetical
account
values
and
expenses
derived
from
the
fund’s
actual
expense
ratio
and
an
assumed
5%
per
year
rate
of
return
before
expenses
(not
the
fund’s
actual
return).
You
may
compare
the
ongoing
costs
of
investing
in
the
fund
with
other
funds
by
contrasting
this
5%
hypothetical
example
and
the
5%
hypothetical
examples
that
appear
in
the
shareholder
reports
of
the
other
funds.
The
hypothetical
account
values
and
expenses
may
not
be
used
to
estimate
the
actual
ending
account
balance
or
expenses
you
paid
for
the
period.
Capital
Appreciation
and
Income
Fund
1.70%
Capital
Appreciation
and
Income
Fund–I
Class
1.68
The
expense
ratio
shown
is
as
of
the
fund’s
most
recent
prospectus.
This
number
may
vary
from
the
expense
ratio
shown
elsewhere
in
this
report
because
it
is
based
on
a
different
time
period
and,
if
applicable,
includes
acquired
fund
fees
and
expenses
but
does
not
include
fee
or
expense
waivers.
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
Note:
T.
Rowe
Price
charges
an
annual
account
service
fee
of
$20,
generally
for
accounts
with
less
than
$10,000.
The
fee
is
waived
for
any
investor
whose
T.
Rowe
Price
mutual
fund
accounts
total
$50,000
or
more;
accounts
electing
to
receive
electronic
delivery
of
account
statements,
transaction
confirmations,
prospectuses,
and
shareholder
reports;
or
accounts
of
an
investor
who
is
a
T.
Rowe
Price
Personal
Services
or
Enhanced
Personal
Services
client
(enrollment
in
these
programs
generally
requires
T.
Rowe
Price
assets
of
at
least
$250,000).
This
fee
is
not
included
in
the
accompanying
table.
If
you
are
subject
to
the
fee,
keep
it
in
mind
when
you
are
estimating
the
ongoing
expenses
of
investing
in
the
fund
and
when
comparing
the
expenses
of
this
fund
with
other
funds.
You
should
also
be
aware
that
the
expenses
shown
in
the
table
highlight
only
your
ongoing
costs
and
do
not
reflect
any
transaction
costs,
such
as
redemption
fees
or
sales
loads.
Therefore,
the
second
line
of
the
table
is
useful
in
comparing
ongoing
costs
only
and
will
not
help
you
determine
the
relative
total
costs
of
owning
different
funds.
To
the
extent
a
fund
charges
transaction
costs,
however,
the
total
cost
of
owning
that
fund
is
higher.
FUND
EXPENSE
EXAMPLE
(CONTINUED)
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
CAPITAL
APPRECIATION
AND
INCOME
FUND
Beginning
Account
Value
Ending
Account
Value
Expenses
Paid
During
Period
Investor
Class
11/30/23
1
12/31/23
11/30/23
to
12/31/23
1,2
Actual
$1,000.00
$1,031.50
$0.58
7/1/23
1
12/31/23
7/1/23
to
12/31/23
1,3
Hypothetical
(assumes
5%
return
before
expenses)
1,000.00
1,021.93
3.31
I
Class
11/30/23
1
12/31/23
11/30/23
to
12/31/23
1,2
Actual
1,000.00
1,031.60
0.43
7/1/23
1
12/31/23
7/1/23
to
12/31/23
1,3
Hypothetical
(assumes
5%
return
before
expenses)
1,000.00
1,022.79
2.45
1
The
actual
expense
example
is
based
on
the
period
since
the
fund's
start
of
operations
on
11/30/23,
one
day
after
inception;
the
hypothetical
expense
example
is
based
on
the
half-
year
period
beginning
7/1/23,
as
required
by
the
SEC.
2
Expenses
are
equal
to
the
fund’s
annualized
expense
ratio
for
the
period
since
inception,
multiplied
by
the
average
account
value
over
the
period,
multiplied
by
the
number
of
days
in
the
period
(32),
and
divided
by
the
days
in
the
year
(365)
to
reflect
the
period
since
the
fund's
start
of
operations.
The
annualized
expense
ratio
of
Investor
Class
was
0.65%,
and
the
I
Class
was
0.48%.
3
Expenses
are
equal
to
the
fund’s
annualized
expense
ratio
for
the
period
since
inception,
multiplied
by
the
average
account
value
over
the
period,
multiplied
by
the
number
of
days
in
the
most
recent
fiscal
half
year
(184),
and
divided
by
the
days
in
the
year
(365)
to
reflect
the
half-year
period.
The
annualized
expense
ratio
of
the
Investor
Class
was
0.65%,
and
the
I
Class
was
0.48%.
FUND
EXPENSE
EXAMPLE
(CONTINUED)
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
For
a
share
outstanding
throughout
the
period
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Investor
Class
(1)
11/29/23
(1)
Through
12/31/23
NET
ASSET
VALUE
Beginning
of
period
$
25.00
Investment
activities
Net
investment
income
(2)(3)
0.07
Net
realized
and
unrealized
gain/loss
0.72
Total
from
investment
activities
0.79
Distributions
Net
investment
income
(0.07)
NET
ASSET
VALUE
End
of
period
$
25.72
Ratios/Supplemental
Data
Total
return
(3)(4)
3.15%
Ratios
to
average
net
assets:
(3)
Gross
expenses
before
waivers/payments
by
Price
Associates
0.88%
(5)
Net
expenses
after
waivers/payments
by
Price
Associates
0.65%
(5)
Net
investment
income
3.23%
(5)
Portfolio
turnover
rate
0.4%
Net
assets,
end
of
period
(in
millions)
$33
0%
(1)
Inception
date
(2)
Per
share
amounts
calculated
using
average
shares
outstanding
method.
(3)
See
Note
6
for
details
of
expense-related
arrangements
with
Price
Associates.
(4)
Total
return
reflects
the
rate
that
an
investor
would
have
earned
on
an
investment
in
the
fund
during
the
period,
assuming
reinvestment
of
all
distributions,
and
payment
of
no
redemption
or
account
fees,
if
applicable.
Total
return
is
not
annualized
for
periods
less
than
one
year.
(5)
Annualized
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
For
a
share
outstanding
throughout
the
period
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
I
Class
(1)
11/29/23
(1)
Through
12/31/23
NET
ASSET
VALUE
Beginning
of
period
$
25.00
Investment
activities
Net
investment
income
(2)(3)
0.08
Net
realized
and
unrealized
gain/loss
0.71
Total
from
investment
activities
0.79
Distributions
Net
investment
income
(0.07)
NET
ASSET
VALUE
End
of
period
$
25.72
Ratios/Supplemental
Data
Total
return
(3)(4)
3.16%
Ratios
to
average
net
assets:
(3)
Gross
expenses
before
waivers/payments
by
Price
Associates
0.88%
(5)
Net
expenses
after
waivers/payments
by
Price
Associates
0.48%
(5)
Net
investment
income
3.40%
(5)
Portfolio
turnover
rate
0.4%
Net
assets,
end
of
period
(in
millions)
$25
0%
(1)
Inception
date
(2)
Per
share
amounts
calculated
using
average
shares
outstanding
method.
(3)
See
Note
6
for
details
of
expense-related
arrangements
with
Price
Associates.
(4)
Total
return
reflects
the
rate
that
an
investor
would
have
earned
on
an
investment
in
the
fund
during
the
period,
assuming
reinvestment
of
all
distributions,
and
payment
of
no
redemption
or
account
fees,
if
applicable.
Total
return
is
not
annualized
for
periods
less
than
one
year.
(5)
Annualized
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
December
31,
2023
Shares/Par
$
Value
(Cost
and
value
in
$000s)
‡
BANK
LOANS
16.0%
(1)
1011778
BC
ULC,
FRN
1M
TSFR
+
2.25%,
7.606%,
9/23/30 (2)
132,000
132
Alliant
Holdings
Intermediate,
FRN
1M
TSFR
+
3.50%,
8.865%,
11/6/30 (2)
255,360
256
Applied
Systems,
FRN
3M
TSFR
+
4.50%,
9.848%,
9/18/26 (2)
834,897
838
Applied
Systems,
FRN
3M
TSFR
+
6.75%,
12.098%,
9/17/27 (2)
125,000
125
AssuredPartners,
FRN
1M
TSFR
+
3.50%,
8.856%,
2/12/27 (2)
86,000
86
AssuredPartners,
FRN
1M
TSFR
+
3.50%,
8.97%,
2/12/27 (2)
86,000
86
AssuredPartners,
FRN
1M
TSFR
+
3.50%,
8.97%,
2/12/27 (2)
85,823
86
Avantor
Funding,
FRN
1M
TSFR
+
2.25%,
7.706%,
11/8/27 (2)
141,073
141
Azalea
Topco,
FRN
1M
TSFR
+
3.50%,
8.97%,
7/24/26 (2)
59,844
59
BroadStreet
Partners,
FRN
1M
TSFR
+
3.00%,
8.47%,
1/27/27 (2)
97,746
98
BroadStreet
Partners,
FRN
1M
TSFR
+
4.00%,
1/27/29 (2)
60,000
60
BroadStreet
Partners,
FRN
1M
USD
LIBOR
+
3.75%,
1/26/29 (2)
41,000
41
Delta
2,
FRN
1M
TSFR
+
2.25%,
1/15/30 (2)
384,000
385
Epicor
Software,
FRN
1M
TSFR
+
3.25%,
7/30/27 (2)
142,000
142
Epicor
Software,
FRN
1M
TSFR
+
3.75%,
7/30/27 (2)
120,000
121
Filtration
Group,
FRN
1M
TSFR
+
3.50%,
8.97%,
10/21/28 (2)
274,298
275
Filtration
Group,
FRN
1M
TSFR
+
4.25%,
9.72%,
10/21/28 (2)
340,143
341
Four
Seasons
Hotels,
FRN
1M
TSFR
+
2.50%,
7.956%,
11/30/29 (2)
379,043
380
Hilton
Domestic
Operating,
FRN
1M
TSFR
+
1.75%,
6/21/28 (2)
544,000
545
HUB
International,
FRN
1M
TSFR
+
4.25%,
9.662%,
6/20/30 (2)
450,870
453
HUB
International,
FRN
3M
TSFR
+
4.00%,
9.369%,
11/10/29 (2)
114,710
115
ICON
Luxembourg,
FRN
3M
TSFR
+
2.50%,
7/3/28 (2)
275,000
276
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
Shares/Par
$
Value
(Cost
and
value
in
$000s)
‡
IRB
Holding,
FRN
1M
TSFR
+
3.00%,
8.456%,
12/15/27 (2)
284,277
284
Loire
Finco
Luxembourg,
FRN
1M
TSFR
+
3.50%,
8.956%,
4/21/27 (2)
282,613
275
Ryan
Specialty,
FRN
1M
TSFR
+
3.00%,
8.456%,
9/1/27 (2)
213,448
213
SBA
Senior
Finance
II,
FRN
1M
TSFR
+
1.75%,
4/11/25 (2)
495,929
496
Severin
Acquisition,
FRN
1M
TSFR
+
3.25%,
8.633%,
8/1/27 (2)
545,000
547
SkyMiles
IP,
FRN
1M
TSFR
+
3.75%,
9.166%,
10/20/27 (2)
125,000
128
Sophia,
FRN
3M
TSFR
+
3.50%,
8.956%,
10/7/27 (2)
211,459
212
Sunshine
Luxembourg
VII,
FRN
3M
TSFR
+
3.50%,
10/1/26 (2)
343,000
345
Trans
Union,
FRN
1M
TSFR
+
1.75%,
11/16/26 (2)
168,000
168
Trans
Union,
FRN
1M
TSFR
+
2.25%,
12/1/28 (2)
171,000
171
TransDigm,
FRN
1M
TSFR
+
3.25%,
8.598%,
2/22/27 (2)
211,466
212
TransDigm,
FRN
1M
TSFR
+
3.25%,
8.598%,
8/24/28 (2)
213,462
214
UKG,
FRN
3M
TSFR
+
3.25%,
5/4/26 (2)
477,781
479
USI,
FRN
1M
TSFR
+
3.00%,
8.356%,
11/22/29 (2)
168,000
168
USI,
FRN
1M
TSFR
+
3.25%,
8.598%,
9/27/30 (2)
142,000
142
USI,
FRN
1M
USD
LIBOR
+
3.00%,
11/22/29 (2)
116,000
116
Total
Bank
Loans
(Cost
$9,220)
9,211
COMMON
STOCKS
37.8%
COMMUNICATION
SERVICES
2.9%
Interactive
Media
&
Services
2.7%
Alphabet,
Class
A (3)
7,337
1,025
Meta
Platforms,
Class
A (3)
1,479
523
1,548
Wireless
Telecommunication
Services
0.2%
T-Mobile
U.S.
772
124
124
Total
Communication
Services
1,672
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
Shares/Par
$
Value
(Cost
and
value
in
$000s)
‡
CONSUMER
DISCRETIONARY
3.9%
Broadline
Retail
1.2%
Amazon.com (3)
4,520
687
687
Distributors
0.1%
LKQ
1,533
73
73
Diversified
Consumer
Services
0.1%
Service
Corp
International
1,078
74
74
Hotels,
Restaurants
&
Leisure
1.4%
Domino's
Pizza
193
80
Hilton
Worldwide
Holdings
648
118
McDonald's
833
247
Starbucks
1,374
132
Yum!
Brands
1,887
246
823
Household
Durables
0.2%
Lennar,
Class
A
637
95
95
Specialty
Retail
0.9%
Home
Depot
788
273
O'Reilly
Automotive (3)
113
108
Tractor
Supply
336
72
Ulta
Beauty (3)
143
70
523
Total
Consumer
Discretionary
2,275
CONSUMER
STAPLES
1.0%
Beverages
0.5%
Keurig
Dr
Pepper
2,867
96
PepsiCo
1,137
193
289
Household
Products
0.5%
Procter
&
Gamble
1,918
281
281
Total
Consumer
Staples
570
ENERGY
1.1%
Energy
Equipment
&
Services
0.1%
Baker
Hughes
2,479
85
85
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
Shares/Par
$
Value
(Cost
and
value
in
$000s)
‡
Oil,
Gas
&
Consumable
Fuels
1.0%
Canadian
Natural
Resources
2,758
181
Cheniere
Energy
442
75
EOG
Resources
1,181
143
Exxon
Mobil
1,783
178
577
Total
Energy
662
FINANCIALS
4.1%
Banks
1.4%
Bank
of
America
7,655
258
JPMorgan
Chase
2,314
393
PNC
Financial
Services
Group
915
142
793
Capital
Markets
0.7%
Goldman
Sachs
Group
430
166
Intercontinental
Exchange
822
106
Raymond
James
Financial
908
101
373
Financial
Services
1.5%
Fiserv (3)
1,042
138
Mastercard,
Class
A
808
345
Visa,
Class
A
1,384
360
843
Insurance
0.5%
Aflac
1,181
97
Marsh
&
McLennan
866
164
261
Total
Financials
2,270
HEALTH
CARE
6.4%
Biotechnology
0.7%
AbbVie (4)
2,004
311
Biogen (3)
353
91
402
Health
Care
Equipment
&
Supplies
1.1%
Abbott
Laboratories
1,449
160
Becton
Dickinson
&
Company
457
111
Edwards
Lifesciences (3)
1,249
95
GE
HealthCare
Technologies
1,610
125
Stryker
491
147
638
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
Shares/Par
$
Value
(Cost
and
value
in
$000s)
‡
Health
Care
Providers
&
Services
1.8%
Elevance
Health
377
178
HCA
Healthcare
592
160
Humana
223
102
McKesson
242
112
UnitedHealth
Group
919
484
1,036
Life
Sciences
Tools
&
Services
1.7%
Agilent
Technologies
1,027
143
Bruker
1,158
85
Danaher
1,116
258
IQVIA
Holdings (3)
669
155
Mettler-Toledo
International (3)
78
95
Revvity
919
100
Thermo
Fisher
Scientific
284
151
987
Pharmaceuticals
1.1%
Eli
Lilly
322
188
Johnson
&
Johnson
1,828
286
Zoetis
829
164
638
Total
Health
Care
3,701
INDUSTRIALS
&
BUSINESS
SERVICES
4.1%
Aerospace
&
Defense
0.5%
General
Dynamics
490
127
Lockheed
Martin
377
171
298
Building
Products
0.2%
A.O.
Smith
1,246
103
103
Commercial
Services
&
Supplies
1.2%
Cintas
209
126
Copart (3)
1,956
96
Republic
Services
1,016
167
Waste
Connections
806
120
Waste
Management
920
165
674
Construction
&
Engineering
0.1%
EMCOR
Group
341
73
73
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
Shares/Par
$
Value
(Cost
and
value
in
$000s)
‡
Ground
Transportation
0.3%
CSX
4,267
148
148
Industrial
Conglomerates
0.2%
Roper
Technologies
172
94
94
Machinery
1.6%
Caterpillar
517
153
Donaldson
1,017
67
Dover
708
109
Fortive
1,458
107
Illinois
Tool
Works
505
132
Ingersoll
Rand
1,917
148
Parker-Hannifin
257
118
Snap-on
313
91
925
Total
Industrials
&
Business
Services
2,315
INFORMATION
TECHNOLOGY
9.6%
Electronic
Equipment,
Instruments
&
Components
0.3%
TE
Connectivity
767
108
Teledyne
Technologies (3)
201
89
197
IT
Services
0.5%
Accenture,
Class
A
560
196
VeriSign (3)
471
97
293
Semiconductors
&
Semiconductor
Equipment
1.8%
Applied
Materials
1,098
178
KLA
236
137
Microchip
Technology
1,414
128
NVIDIA
767
380
NXP
Semiconductors
863
198
1,021
Software
4.5%
Adobe (3)
373
223
Autodesk (3)
434
106
Cadence
Design
Systems (3)
396
108
Fair
Isaac (3)
80
93
Microsoft
4,495
1,690
PTC (3)
510
89
Salesforce (3)
921
242
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
Shares/Par
$
Value
(Cost
and
value
in
$000s)
‡
Synopsys (3)
120
62
2,613
Technology
Hardware,
Storage
&
Peripherals
2.5%
Apple
7,360
1,417
1,417
Total
Information
Technology
5,541
MATERIALS
0.5%
Chemicals
0.3%
Linde
487
200
200
Containers
&
Packaging
0.2%
Berry
Global
Group
909
61
Packaging
Corp.
of
America
386
63
124
Total
Materials
324
REAL
ESTATE
0.7%
Industrial
Real
Estate
Investment
Trusts
0.3%
Prologis,
REIT
1,254
167
167
Specialized
Real
Estate
Investment
Trusts
0.4%
American
Tower,
REIT
747
161
SBA
Communications,
REIT
341
87
248
Total
Real
Estate
415
UTILITIES
2.4%
Electric
Utilities
1.0%
Entergy
1,095
111
Evergy
1,650
86
Exelon
3,443
124
Xcel
Energy
3,637
225
546
Multi-Utilities
1.4%
Ameren
2,302
167
CenterPoint
Energy
4,602
131
CMS
Energy
1,480
86
DTE
Energy
1,352
149
Public
Service
Enterprise
Group
1,799
110
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
Shares/Par
$
Value
(Cost
and
value
in
$000s)
‡
WEC
Energy
Group
1,693
142
785
Total
Utilities
1,331
Total
Miscellaneous
Common
Stocks
1.1% (5)
636
Total
Common
Stocks
(Cost
$21,078)
21,712
CORPORATE
BONDS
16.7%
Alliant
Holdings
Intermediate,
4.25%,
10/15/27 (6)
58,000
55
Alliant
Holdings
Intermediate,
5.875%,
11/1/29 (6)
62,000
58
Alliant
Holdings
Intermediate,
6.75%,
10/15/27 (6)
190,000
189
Alliant
Holdings
Intermediate,
6.75%,
4/15/28 (6)
48,000
49
American
Tower,
3.80%,
8/15/29
149,000
141
American
Tower,
5.90%,
11/15/33
138,000
146
Avantor
Funding,
3.875%,
11/1/29 (6)
316,000
287
Avantor
Funding,
4.625%,
7/15/28 (6)
75,000
71
Becton
Dickinson
&
Company,
4.669%,
6/6/47
190,000
178
Biogen,
3.15%,
5/1/50
222,000
155
Biogen,
3.25%,
2/15/51
210,000
150
Biogen,
5.20%,
9/15/45
145,000
141
Booz
Allen
Hamilton,
3.875%,
9/1/28 (6)
149,000
141
Booz
Allen
Hamilton,
4.00%,
7/1/29 (6)
78,000
73
Booz
Allen
Hamilton,
5.95%,
8/4/33
137,000
145
BroadStreet
Partners,
5.875%,
4/15/29 (6)
132,000
123
CCO
Holdings,
5.00%,
2/1/28 (6)
147,000
141
CCO
Holdings,
5.125%,
5/1/27 (6)
147,000
142
Charles
River
Laboratories
International,
3.75%,
3/15/29 (6)
95,000
87
Charles
River
Laboratories
International,
4.00%,
3/15/31 (6)
128,000
115
Exelon,
4.45%,
4/15/46
169,000
147
Fortive,
4.30%,
6/15/46
171,000
145
Gartner,
3.625%,
6/15/29 (6)
235,000
212
Gartner,
3.75%,
10/1/30 (6)
321,000
283
Gartner,
4.50%,
7/1/28 (6)
147,000
139
GFL
Environmental,
6.75%,
1/15/31 (6)
87,000
89
Hilton
Domestic
Operating,
3.625%,
2/15/32 (6)
497,000
432
Hilton
Domestic
Operating,
4.00%,
5/1/31 (6)
81,000
74
Hilton
Domestic
Operating,
4.875%,
1/15/30
75,000
73
Howmet
Aerospace,
3.00%,
1/15/29
81,000
74
Howmet
Aerospace,
5.90%,
2/1/27
66,000
68
Howmet
Aerospace,
5.95%,
2/1/37
210,000
219
Howmet
Aerospace,
6.75%,
1/15/28
68,000
71
HUB
International,
5.625%,
12/1/29 (6)
233,000
221
HUB
International,
7.25%,
6/15/30 (6)
202,000
213
IQVIA,
5.00%,
5/15/27 (6)
145,000
142
IQVIA,
5.70%,
5/15/28 (6)
69,000
70
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
Shares/Par
$
Value
(Cost
and
value
in
$000s)
‡
IQVIA,
6.50%,
5/15/30 (6)
69,000
71
Lockheed
Martin,
4.70%,
5/15/46
78,000
77
Marriott
International,
Series GG,
3.50%,
10/15/32
186,000
165
MSCI,
3.25%,
8/15/33 (6)
173,000
144
MSCI,
3.625%,
9/1/30 (6)
128,000
116
MSCI,
3.625%,
11/1/31 (6)
98,000
86
MSCI,
3.875%,
2/15/31 (6)
128,000
116
MSCI,
4.00%,
11/15/29 (6)
154,000
145
Northrop
Grumman,
5.25%,
5/1/50
217,000
224
PRA
Health
Sciences,
2.875%,
7/15/26 (6)
78,000
73
PTC,
4.00%,
2/15/28 (6)
301,000
284
RTX,
5.15%,
2/27/33
70,000
71
SBA
Communications,
3.125%,
2/1/29
561,000
504
Service
Corp.
International,
3.375%,
8/15/30
50,000
44
Service
Corp.
International,
4.00%,
5/15/31
117,000
105
TransDigm,
4.625%,
1/15/29
78,000
73
TransDigm,
7.125%,
12/1/31 (6)
139,000
146
VICI
Properties,
4.125%,
8/15/30 (6)
316,000
288
VICI
Properties,
4.625%,
12/1/29 (6)
311,000
292
Workday,
3.80%,
4/1/32
80,000
74
Yum!
Brands,
3.625%,
3/15/31
257,000
231
Yum!
Brands,
4.625%,
1/31/32
271,000
253
Yum!
Brands,
4.75%,
1/15/30 (6)
231,000
224
Yum!
Brands,
5.35%,
11/1/43
161,000
157
Yum!
Brands,
5.375%,
4/1/32
240,000
235
Yum!
Brands,
6.875%,
11/15/37
140,000
153
Total
Corporate
Bonds
(Cost
$9,410)
9,610
U.S.
GOVERNMENT
AGENCY
OBLIGATIONS
(EXCLUDING
MORTGAGE-BACKED)
17.1%
U.S.
Treasury
Obligations
17.1%
U.S.
Treasury
Notes,
4.50%,
11/15/33
9,371,000
9,854
9,854
Total
U.S.
Government
Agency
Obligations
(Excluding
Mortgage-Backed)
(Cost
$9,636)
9,854
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
Shares/Par
$
Value
(Cost
and
value
in
$000s)
‡
SHORT-TERM
INVESTMENTS
17.1%
Money
Market
Funds
17.1%
T.
Rowe
Price
Government
Reserve
Fund,
5.42% (7)(8)
9,836,149
9,836
Total
Short-Term
Investments
(Cost
$9,836)
9,836
Total
Investments
in
Securities
104.7%
of
Net
Assets
(Cost
$59,180)
$
60,223
‡
Shares/Par
and
Notional
Amount
are
denominated
in
U.S.
dollars
unless
otherwise
noted.
(1)
Bank
loan
positions
may
involve
multiple
underlying
tranches.
In
those
instances,
the
position
presented
reflects
the
aggregate
of
those
respective
underlying
tranches
and
the
rate
presented
reflects
the
weighted
average
rate
of
the
settled
positions.
(2)
All
or
a
portion
of
this
loan
is
unsettled
as
of
December
31,
2023.
The
interest
rate
for
unsettled
loans
will
be
determined
upon
settlement
after
period
end.
(3)
Non-income
producing
(4)
All
or
a
portion
of
this
security
is
pledged
to
cover
or
as
collateral
for
written
call
options
at
December
31,
2023.
(5)
The
identity
of
certain
securities
has
been
concealed
to
protect
the
fund
while
it
completes
a
purchase
or
selling
program
for
the
securities.
(6)
Security
was
purchased
pursuant
to
Rule
144A
under
the
Securities
Act
of
1933
and
may
be
resold
in
transactions
exempt
from
registration
only
to
qualified
institutional
buyers.
Total
value
of
such
securities
at
period-end
amounts
to
$5,391
and
represents
9.4%
of
net
assets.
(7)
Seven-day
yield
(8)
Affiliated
Companies
1M
TSFR
One
month
term
SOFR
(Secured
overnight
financing
rate)
1M
USD
LIBOR
One
month
USD
LIBOR
(London
interbank
offered
rate)
3M
TSFR
Three
month
term
SOFR
(Secured
overnight
financing
rate)
FRN
Floating
Rate
Note
OTC
Over-the-counter
REIT
A
domestic
Real
Estate
Investment
Trust
whose
distributions
pass-through
with
original
tax
character
to
the
shareholder
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
(Amounts
in
000s,
except
for
contracts)
OPTIONS
WRITTEN
(0.0)%
OTC
Options
Written
(0.0)%
Counterparty
Description
Contracts
Notional
Amount
$
Value
JPMorgan
Chase
AbbVie,
Call,
1/17/25
@
$175.00
15
232
(8)
Total
Options
Written
(Premiums
$(8))
$
(8)
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
AFFILIATED
COMPANIES
($000s)
The
fund
may
invest
in
certain
securities
that
are
considered
affiliated
companies.
As
defined
by
the
1940
Act,
an
affiliated
company
is
one
in
which
the
fund
owns
5%
or
more
of
the
outstanding
voting
securities,
or
a
company
that
is
under
common
ownership
or
control.
The
following
securities
were
considered
affiliated
companies
for
all
or
some
portion
of
the
period
ended
December
31,
2023.
Net
realized
gain
(loss),
investment
income,
change
in
net
unrealized
gain/loss,
and
purchase
and
sales
cost
reflect
all
activity
for
the
period
then
ended.
Affiliate
Net
Realized
Gain
(Loss)
Change
in
Net
Unrealized
Gain/Loss
Investment
Income
T.
Rowe
Price
Government
Reserve
Fund,
5.42%
$
—#
$
—
$
40+
Supplementary
Investment
Schedule
Affiliate
Value
11/29/23
Purchase
Cost
Sales
Cost
Value
12/31/23
T.
Rowe
Price
Government
Reserve
Fund,
5.42%
$
—
¤
¤
$
9,836^
#
Capital
gain
distributions
from
underlying
Price
funds
represented
$0
of
the
net
realized
gain
(loss).
+
Investment
income
comprised
$40
of
dividend
income
and
$0
of
interest
income.
¤
Purchase
and
sale
information
not
shown
for
cash
management
funds.
^
The
cost
basis
of
investments
in
affiliated
companies
was
$9,836.
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
December
31,
2023
Statement
of
Assets
and
Liabilities
($000s,
except
shares
and
per
share
amounts)
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Assets
Investments
in
securities,
at
value
(cost
$59,180)
$
60,223
Receivable
for
shares
sold
4,638
Interest
and
dividends
receivable
186
Cash
17
Due
from
affiliates
3
Other
assets
11
Total
assets
65,078
Liabilities
Payable
for
investment
securities
purchased
7,502
Investment
management
fees
payable
15
Options
written
(premiums
$8)
8
Other
liabilities
14
Total
liabilities
7,539
NET
ASSETS
$
57,539
Net
Assets
Consist
of:
Total
distributable
earnings
(loss)
$
1,046
Paid-in
capital
applicable
to
2,236,880
shares
of
$0.0001
par
value
capital
stock
outstanding;
4,000,000,000,
shares
authorized
56,493
NET
ASSETS
$
57,539
NET
ASSET
VALUE
PER
SHARE
Investor
Class
(Net
assets:
$32,877;
Shares
outstanding:
1,278,173)
$
25.72
I
Class
(Net
assets:
$24,662;
Shares
outstanding:
958,707)
$
25.72
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
11/29/23
Through
12/31/23
Investment
Income
(Loss)
Income
Interest
$
77
Dividend
58
Total
income
135
Expenses
Investment
management
15
Custody
and
accounting
16
Waived
/
paid
by
Price
Associates
(11)
Total
expenses
20
Net
investment
income
115
Realized
and
Unrealized
Gain
/
Loss
–
Net
realized
gain
on
securities
3
Change
in
net
unrealized
gain
/
loss
on
securities
1,043
Net
realized
and
unrealized
gain
/
loss
1,046
INCREASE
IN
NET
ASSETS
FROM
OPERATIONS
$
1,161
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
Statement
of
Changes
in
Net
Assets
11/29/23
Through
12/31/23
Increase
(Decrease)
in
Net
Assets
Operations
Net
investment
income
$
115
Net
realized
gain
3
Change
in
net
unrealized
gain
/
loss
1,043
Increase
in
net
assets
from
operations
1,161
Distributions
to
shareholders
Net
earnings
Investor
Class
(60)
I
Class
(55)
Decrease
in
net
assets
from
distributions
(115)
Capital
share
transactions
*
Shares
sold
Investor
Class
33,841
I
Class
24,165
Distributions
reinvested
Investor
Class
27
I
Class
19
Shares
redeemed
Investor
Class
(1,548)
I
Class
(11)
Increase
in
net
assets
from
capital
share
transactions
56,493
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
Statement
of
Changes
in
Net
Assets
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
11/29/23
Through
12/31/23
Net
Assets
Increase
during
period
57,539
Beginning
of
period
–
End
of
period
$
57,539
*Share
information
(000s)
Shares
sold
Investor
Class
1,337
I
Class
958
Distributions
reinvested
Investor
Class
1
I
Class
1
Shares
redeemed
Investor
Class
(60)
I
Class
–
(1
)
Increase
in
shares
outstanding
2,237
(2)
Amount
rounds
to
less
than
1,000
shares
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
NOTES
TO
FINANCIAL
STATEMENTS
T.
Rowe
Price
Capital
Appreciation
Fund,
Inc.
(the
corporation) is
registered
under
the
Investment
Company
Act
of
1940
(the
1940
Act).
The
Capital
Appreciation
and
Income
Fund
(the
fund)
is a
diversified, open-end
management
investment
company
established
by
the
corporation. The
fund
incepted
on
November
29,
2023. The
fund
seeks
total
return
through
a
combination
of
income
and
capital
appreciation.
The
fund
has two classes
of
shares:
the
Capital
Appreciation
and
Income
Fund
(Investor
Class)
and
the
Capital
Appreciation
and
Income
Fund–I
Class
(I
Class).
I
Class
shares
require
a
$500,000
initial
investment
minimum,
although
the
minimum
generally
is
waived
or
reduced
for
financial
intermediaries,
eligible
retirement
plans,
and
certain
other
accounts. Each
class
has
exclusive
voting
rights
on
matters
related
solely
to
that
class;
separate
voting
rights
on
matters
that
relate
to
both
classes;
and,
in
all
other
respects,
the
same
rights
and
obligations
as
the
other
class.
NOTE
1
-
SIGNIFICANT
ACCOUNTING
POLICIES
Basis
of
Preparation
The fund
is
an
investment
company
and
follows
accounting
and
reporting
guidance
in
the
Financial
Accounting
Standards
Board
(FASB)
Accounting
Standards
Codification
Topic
946
(ASC
946).
The
accompanying
financial
statements
were
prepared
in
accordance
with
accounting
principles
generally
accepted
in
the
United
States
of
America
(GAAP),
including,
but
not
limited
to,
ASC
946.
GAAP
requires
the
use
of
estimates
made
by
management.
Management
believes
that
estimates
and
valuations
are
appropriate;
however,
actual
results
may
differ
from
those
estimates,
and
the
valuations
reflected
in
the
accompanying
financial
statements
may
differ
from
the
value
ultimately
realized
upon
sale
or
maturity.
Investment
Transactions,
Investment
Income,
and
Distributions
Investment
transactions
are
accounted
for
on
the
trade
date
basis.
Income
and
expenses
are
recorded
on
the
accrual
basis.
Realized
gains
and
losses
are
reported
on
the
identified
cost
basis. Premiums
and
discounts
on
debt
securities
are
amortized
for
financial
reporting
purposes. Income
tax-related
interest
and
penalties,
if
incurred,
are
recorded
as
income
tax
expense. Dividends
received
from other
investment
companies are
reflected
as income;
capital
gain
distributions
are
reflected
as
realized
gain/
loss. Dividend
income and
capital
gain
distributions
are
recorded
on
the
ex-dividend
date. Distributions
from
REITs
are
initially
recorded
as
dividend
income
and,
to
the
extent
such
represent
a
return
of
capital
or
capital
gain
for
tax
purposes,
are
reclassified
when
such
information
becomes
available. Non-cash
dividends,
if
any,
are
recorded
at
the
fair
market
value
of
the
asset
received. Proceeds
from
litigation
payments,
if
any,
are
included
in
either
net
realized
gain
(loss)
or
change
in
net
unrealized
gain/loss
from
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
securities. Distributions
to
shareholders
are
recorded
on
the
ex-dividend
date. Income
distributions,
if
any,
are
declared
and
paid
by
each
class monthly. A
capital
gain
distribution,
if
any, may
also
be
declared
and
paid
by
the
fund
annually.
Class
Accounting
Shareholder
servicing,
prospectus,
and
shareholder
report
expenses
incurred
by
each
class
are
charged
directly
to
the
class
to
which
they
relate.
Expenses
common
to
all
classes
and
investment
income
are
allocated
to
the
classes
based
upon
the
relative
daily
net
assets
of
each
class’s
settled
shares;
realized
and
unrealized
gains
and
losses
are
allocated
based
upon
the
relative
daily
net
assets
of
each
class’s
outstanding
shares.
Capital
Transactions
Each
investor’s
interest
in
the
net
assets
of the
fund
is
represented
by
fund
shares. The
fund’s
net
asset
value
(NAV)
per
share
is
computed
at
the
close
of
the
New
York
Stock
Exchange
(NYSE),
normally
4
p.m.
ET,
each
day
the
NYSE
is
open
for
business.
However,
the
NAV
per
share
may
be
calculated
at
a
time
other
than
the
normal
close
of
the
NYSE
if
trading
on
the
NYSE
is
restricted,
if
the
NYSE
closes
earlier,
or
as
may
be
permitted
by
the
SEC.
Purchases
and
redemptions
of
fund
shares
are
transacted
at
the
next-computed
NAV
per
share,
after
receipt
of
the
transaction
order
by
T.
Rowe
Price
Associates,
Inc.,
or
its
agents.
New
Accounting
Guidance
The
FASB
issued
Accounting
Standards
Update
(ASU),
ASU
2020–04,
Reference
Rate
Reform
(Topic
848) –
Facilitation
of
the
Effects
of
Reference
Rate
Reform
on
Financial
Reporting
in
March
2020
and
ASU
2021-01
in
January
2021
which
provided
further
amendments
and
clarifications
to
Topic
848.
These
ASUs provide
optional,
temporary
relief
with
respect
to
the
financial
reporting
of
contracts
subject
to
certain
types
of
modifications
due
to
the
planned
discontinuation
of
the
London
Interbank
Offered
Rate
(LIBOR),
and
other
interbank-offered
based
reference
rates,
through December
31,
2022.
In
December
2022,
FASB
issued
ASU
2022-
06
which
defers
the
sunset
date
of
Topic
848
from
December
31,
2022
to
December
31,
2024,
after
which
entities
will
no
longer
be
permitted
to
apply
the
relief
in
Topic
848.
Management
intends
to
rely
upon
the
relief
provided
under
Topic
848,
which
is
not
expected to
have
a
material
impact
on
the fund's
financial statements.
Indemnification
In
the
normal
course
of
business, the
fund
may
provide
indemnification
in
connection
with
its
officers
and
directors,
service
providers,
and/or
private
company
investments. The
fund’s
maximum
exposure
under
these
arrangements
is
unknown;
however,
the
risk
of
material
loss
is
currently
considered
to
be
remote.
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
NOTE
2
-
VALUATION
Fair
Value
The
fund’s
financial
instruments
are
valued
at
the
close
of
the
NYSE
and
are
reported
at
fair
value,
which
GAAP
defines
as
the
price
that
would
be
received
to
sell
an
asset
or
paid
to
transfer
a
liability
in
an
orderly
transaction
between
market
participants
at
the
measurement
date. The fund’s
Board
of
Directors
(the
Board)
has
designated
T.
Rowe
Price
Associates,
Inc.
as
the
fund’s
valuation
designee
(Valuation
Designee).
Subject
to
oversight
by
the
Board,
the
Valuation
Designee
performs
the
following
functions
in
performing
fair
value
determinations:
assesses
and
manages
valuation
risks;
establishes
and
applies
fair
value
methodologies;
tests
fair
value
methodologies;
and
evaluates
pricing
vendors
and
pricing
agents.
The
duties
and
responsibilities
of
the
Valuation
Designee
are
performed
by
its
Valuation
Committee. The
Valuation
Designee provides
periodic
reporting
to
the
Board
on
valuation
matters.
Various
valuation
techniques
and
inputs
are
used
to
determine
the
fair
value
of
financial
instruments.
GAAP
establishes
the
following
fair
value
hierarchy
that
categorizes
the
inputs
used
to
measure
fair
value:
Level
1
–
quoted
prices
(unadjusted)
in
active
markets
for
identical
financial
instruments
that
the
fund
can
access
at
the
reporting
date
Level
2
–
inputs
other
than
Level
1
quoted
prices
that
are
observable,
either
directly
or
indirectly
(including,
but
not
limited
to,
quoted
prices
for
similar
financial
instruments
in
active
markets,
quoted
prices
for
identical
or
similar
financial
instruments
in
inactive
markets,
interest
rates
and
yield
curves,
implied
volatilities,
and
credit
spreads)
Level
3
–
unobservable
inputs
(including
the Valuation
Designee’s assumptions
in
determining
fair
value)
Observable
inputs
are
developed
using
market
data,
such
as
publicly
available
information
about
actual
events
or
transactions,
and
reflect
the
assumptions
that
market
participants
would
use
to
price
the
financial
instrument.
Unobservable
inputs
are
those
for
which
market
data
are
not
available
and
are
developed
using
the
best
information
available
about
the
assumptions
that
market
participants
would
use
to
price
the
financial
instrument.
GAAP
requires
valuation
techniques
to
maximize
the
use
of
relevant
observable
inputs
and
minimize
the
use
of
unobservable
inputs.
When
multiple
inputs
are
used
to
derive
fair
value,
the
financial
instrument
is
assigned
to
the
level
within
the
fair
value
hierarchy
based
on
the
lowest-level
input
that
is
significant
to
the
fair
value
of
the
financial
instrument.
Input
levels
are
not
necessarily
an
indication
of
the
risk
or
liquidity
associated
with
financial
instruments
at
that
level
but
rather
the
degree
of
judgment
used
in
determining
those
values.
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
Valuation
Techniques
Debt
securities
generally
are
traded
in
the over-the-counter
(OTC)
market
and
are
valued
at
prices
furnished
by
independent
pricing
services
or
by
broker
dealers
who
make
markets
in
such
securities.
When
valuing
securities,
the
independent
pricing
services
consider
factors
such
as,
but
not
limited
to,
the
yield
or
price
of
bonds
of
comparable
quality,
coupon,
maturity,
and
type,
as
well
as
prices
quoted
by
dealers
who
make
markets
in
such
securities.
Equity
securities,
including
exchange-traded
funds, listed
or
regularly
traded
on
a
securities
exchange
or
in
the
over-the-counter
(OTC)
market
are
valued
at
the
last
quoted
sale
price
or,
for
certain
markets,
the
official
closing
price
at
the
time
the
valuations
are
made.
OTC
Bulletin
Board
securities
are
valued
at
the
mean
of
the
closing
bid
and
asked
prices.
A
security
that
is
listed
or
traded
on
more
than
one
exchange
is
valued
at
the
quotation
on
the
exchange
determined
to
be
the
primary
market
for
such
security.
Listed
securities
not
traded
on
a
particular
day
are
valued
at
the
mean
of
the
closing
bid
and
asked
prices
for
domestic
securities.
Investments
in
mutual
funds
are
valued
at
the
mutual
fund’s
closing
NAV
per
share
on
the
day
of
valuation.
Listed
options,
and
OTC
options
with
a
listed
equivalent,
are
valued
at
the
mean
of
the
closing
bid
and
asked
prices
and
exchange-traded
options
on
futures
contracts
are
valued
at
closing
settlement
prices.
Assets
and
liabilities
other
than
financial
instruments,
including
short-term
receivables
and
payables,
are
carried
at
cost,
or
estimated
realizable
value,
if
less,
which
approximates
fair
value.
Investments
for
which
market
quotations are
not
readily
available
or
deemed
unreliable
are
valued
at
fair
value
as
determined
in
good
faith
by
the
Valuation
Designee.
The
Valuation
Designee
has
adopted
methodologies
for
determining
the
fair
value
of
investments
for
which
market
quotations
are
not
readily
available
or
deemed
unreliable,
including
the
use
of
other
pricing
sources.
Factors
used
in
determining
fair
value
vary
by
type
of
investment
and
may
include
market
or
investment
specific
considerations.
The
Valuation
Designee typically
will
afford
greatest
weight
to
actual
prices
in
arm’s
length
transactions,
to
the
extent
they
represent
orderly
transactions
between
market
participants,
transaction
information
can
be
reliably
obtained,
and
prices
are
deemed
representative
of
fair
value.
However,
the
Valuation
Designee may
also
consider
other
valuation
methods
such
as
market-based
valuation
multiples;
a
discount
or
premium
from
market
value
of
a
similar,
freely
traded
security
of
the
same
issuer;
discounted
cash
flows;
yield
to
maturity;
or
some
combination.
Fair
value
determinations
are
reviewed
on
a
regular
basis.
Because
any
fair
value
determination
involves
a
significant
amount
of
judgment,
there
is
a
degree
of
subjectivity
inherent
in
such
pricing
decisions. Fair
value
prices
determined
by
the
Valuation
Designee could
differ
from
those
of
other
market
participants,
and
it
is
possible
that
the
fair
value
determined
for
a
security
may
be
materially
different
from
the
value
that
could
be
realized
upon
the
sale
of
that
security.
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
Valuation
Inputs
The
following
table
summarizes
the
fund’s
financial
instruments,
based
on
the
inputs
used
to
determine
their
fair
values
on
December
31,
2023
(for
further
detail
by
category,
please
refer
to
the
accompanying
Portfolio
of
Investments):
NOTE
3
-
DERIVATIVE
INSTRUMENTS
During
the
period ended
December
31,
2023,
the
fund
invested
in
derivative
instruments.
As
defined
by
GAAP,
a
derivative
is
a
financial
instrument
whose
value
is
derived
from
an
underlying
security
price,
foreign
exchange
rate,
interest
rate,
index
of
prices
or
rates,
or
other
variable;
it
requires
little
or
no
initial
investment
and
permits
or
requires
net
settlement.
The
fund
invests
in
derivatives
only
if
the
expected
risks
and
rewards
are
consistent
with
its
investment
objectives,
policies,
and
overall
risk
profile,
as
described
in
its
prospectus
and
Statement
of
Additional
Information.
The
fund
may
use
derivatives
for
a
variety
of
purposes
and
may
use
them
to
establish
both
long
and
short
positions
within
the
fund’s
portfolio.
Potential
uses
include
to
hedge
against
declines
in
principal
value,
increase
yield,
invest
in
an
asset
with
greater
efficiency
and
at
a
lower
cost
than
is
possible
through
direct
investment,
to
enhance
return,
or
to
adjust
portfolio
duration
and
credit
exposure.
The
risks
associated
with
the
use
of
derivatives
are
different
from,
and
potentially
much
greater
than,
the
risks
associated
with
investing
directly
in
the
instruments
on
which
the
derivatives
are
based.
($000s)
Level
1
Level
2
Level
3
Total
Value
Assets
Fixed
Income
Securities
1
$
—
$
28,675
$
—
$
28,675
Common
Stocks
21,712
—
—
21,712
Short-Term
Investments
9,836
—
—
9,836
Total
$
31,548
$
28,675
$
—
$
60,223
Liabilities
Options
Written
$
—
$
8
$
—
$
8
1
Includes
Bank
Loans,
Corporate
Bonds
and
U.S.
Government
Agency
Obligations
(Excluding
Mortgage-Backed).
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
The
fund
values
its
derivatives
at
fair
value
and
recognizes
changes
in
fair
value
currently
in
its
results
of
operations.
Accordingly,
the
fund
does
not
follow
hedge
accounting,
even
for
derivatives
employed
as
economic
hedges.
Generally,
the
fund
accounts
for
its
derivatives
on
a
gross
basis.
It
does
not
offset
the
fair
value
of
derivative
liabilities
against
the
fair
value
of
derivative
assets
on
its
financial
statements,
nor
does
it
offset
the
fair
value
of
derivative
instruments
against
the
right
to
reclaim
or
obligation
to
return
collateral.
The
following
table
summarizes
the
fair
value
of
the
fund’s
derivative
instruments
held
as
of
December
31,
2023,
and
the
related
location
on
the
accompanying
Statement
of
Assets
and
Liabilities,
presented
by
primary
underlying
risk
exposure:
During
the
period
ended
December
31,
2023,
the
fund
recognized
no
gains
or
losses
on
derivative
instruments.
Counterparty
Risk
and
Collateral
The
fund
invests
in
derivatives,
such
as
non-cleared
bilateral
swaps,
forward
currency
exchange
contracts,
and/or
OTC
options,
that
are
transacted
and
settle
directly
with
a
counterparty
(bilateral
derivatives),
and
thereby
may
expose
the
fund
to
counterparty
risk.
To
mitigate
this
risk,
the
fund
has
entered
into
master
netting
arrangements
(MNAs)
with
certain
counterparties
that
permit
net
settlement
under
specified
conditions
and,
for
certain
counterparties,
also
require
the
exchange
of
collateral
to
cover
mark-to-market
exposure.
MNAs
may
be
in
the
form
of
International
Swaps
and
Derivatives
Association
master
agreements
(ISDAs)
or
foreign
exchange
letter
agreements
(FX
letters).
MNAs
govern
the
ability
to
offset
amounts
the
fund
owes
a
counterparty
against
amounts
the
counterparty
owes
the
fund
(net
settlement).
Both
ISDAs
and
FX
letters
generally
allow
termination
of
transactions
and
net
settlement
upon
the
occurrence
of
contractually
specified
events,
such
as
failure
to
pay
or
bankruptcy.
In
addition,
ISDAs
specify
other
events,
the
occurrence
of
which
would
allow
one
of
the
parties
to
terminate.
For
example,
a
downgrade
in
credit
rating
of
a
counterparty
below
a
specified
rating
would
allow
the
fund
to
terminate,
while
a
decline
in
the
fund’s
net
assets
of
more
than
a
specified
percentage
would
allow
the
counterparty
to
terminate.
Upon
termination,
all
transactions
with
that
counterparty
would
be
liquidated
and
a
($000s)
Location
on
Statement
of
Assets
and
Liabilities
Fair
Value
Liabilities
Equity
derivatives
Options
Written
$
8
Total
$
8
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
net
termination
amount
determined.
ISDAs
typically
include
collateral
agreements
whereas
FX
letters
do
not.
Collateral
requirements
are
determined
daily
based
on
the
net
aggregate
unrealized
gain
or
loss
on
all
bilateral
derivatives
with
each
counterparty,
subject
to
minimum
transfer
amounts
that
typically
range
from
$100,000
to
$250,000.
Any
additional
collateral
required
due
to
changes
in
security
values
is
typically
transferred
the
next
business
day.
Collateral may
be
in
the
form
of
cash
or
debt
securities
issued
by
the
U.S.
government
or
related
agencies,
although
other
securities
may
be
used
depending
on
the
terms
outlined
in
the
applicable
MNA.
Cash
posted
by
the
fund
is
reflected
as
cash
deposits
in
the
accompanying
financial
statements
and
generally
is
restricted
from
withdrawal
by
the
fund;
securities
posted
by
the
fund
are
so
noted
in
the
accompanying
Portfolio
of
Investments;
both
remain
in
the
fund’s
assets.
Collateral
pledged
by
counterparties
is
not
included
in
the
fund’s
assets
because
the
fund
does
not
obtain
effective
control
over
those
assets.
For
bilateral
derivatives,
collateral
posted
or
received
by
the
fund
is
held
in
a
segregated
account
at
the
fund’s
custodian.
While
typically
not
sold
in
the
same
manner
as
equity
or
fixed
income
securities,
OTC
and
bilateral
derivatives
may
be
unwound
with
counterparties
or
transactions
assigned
to
other
counterparties
to
allow
the
fund
to
exit
the
transaction.
This
ability
is
subject
to
the
liquidity
of
underlying
positions. As
of
December
31,
2023,
no
collateral
was
pledged
by
either
the
fund
or
counterparties for
bilateral
derivatives.
Options
The
fund
is
subject
to equity
price
risk in
the
normal
course
of
pursuing
its
investment
objectives
and
uses
options
to
help
manage
such
risk.
The
fund
may
use
options
to
manage
exposure
to
security
prices,
interest
rates,
foreign
currencies,
and
credit
quality;
as
an
efficient
means
of
adjusting
exposure
to
all
or
a
part
of
a
target
market;
to
enhance
income;
as
a
cash
management
tool;
or
to
adjust
credit
exposure.
The
fund
may
buy
or
sell
options
that
can
be
settled
either
directly
with
the
counterparty
(OTC
option)
or
through
a
central
clearinghouse
(exchange-traded
option).
Options
are
included
in
net
assets
at
fair
value,
options
purchased
are
included
in
Investments
in
Securities,
and
options
written
are
separately
reflected
as
a
liability
on
the
accompanying
Statement
of
Assets
and
Liabilities.
Premiums
on
unexercised,
expired
options
are
recorded
as
realized
gains
or
losses
on
the
accompanying
Statement
of
Operations;
premiums
on
exercised
options
are
recorded
as
an
adjustment
to
the
proceeds
from
the
sale
or
cost
of
the
purchase.
The
difference
between
the
premium
and
the
amount
received
or
paid
in
a
closing
transaction
is
also
treated
as
realized
gain
or
loss
on
the
accompanying
Statement
of
Operations.
In
return
for
a
premium
paid,
call
and
put
options
give
the
holder
the
right,
but
not
the
obligation,
to
purchase
or
sell,
respectively,
a
security
at
a
specified
exercise
price.
Risks related
to
the
use
of
options
include
possible
illiquidity
of
the
options
markets;
trading
restrictions
imposed
by
an
exchange
or
counterparty;
possible
failure
of
counterparties
to
meet
the
terms
of
the
agreements;
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
movements
in
the
underlying
asset
values
and,
for
options
written,
the
potential
for
losses
to
exceed
any
premium
received
by
the
fund.
During
the
period ended
December
31,
2023,
the
volume
of
the
fund’s
activity
in
options,
based
on
underlying
notional
amounts,
was
generally
less
than
1%
of
net
assets.
NOTE
4
-
OTHER
INVESTMENT
TRANSACTIONS
Consistent
with
its
investment
objective,
the
fund
engages
in
the
following
practices
to
manage
exposure
to
certain
risks
and/or
to
enhance
performance.
The
investment
objective,
policies,
program,
and
risk
factors
of
the
fund
are
described
more
fully
in
the
fund's
prospectus
and
Statement
of
Additional
Information.
Noninvestment-Grade
Debt
The
fund
invests,
either
directly
or
through
its
investment
in
other
T.
Rowe
Price
funds,
in
noninvestment-grade
debt,
including
“high
yield”
or
“junk”
bonds
or
leveraged
loans.
Noninvestment-grade
debt
issuers
are
more
likely
to
suffer
an
adverse
change
in
financial
condition
that
would
result
in
the
inability
to
meet
a
financial
obligation.
The
noninvestment-grade
debt
market
may
experience
sudden
and
sharp
price
swings
due
to
a
variety
of
factors
that
may
decrease
the
ability
of
issuers
to
make
principal
and
interest
payments
and
adversely
affect
the
liquidity
or
value,
or
both,
of
such
securities.
Accordingly,
securities
issued
by
such
companies
carry
a
higher
risk
of
default
and
should
be
considered
speculative.
Restricted
Securities
The
fund
invests
in
securities
that
are
subject
to
legal
or
contractual
restrictions
on
resale.
Prompt
sale
of
such
securities
at
an
acceptable
price
may
be
difficult
and
may
involve
substantial
delays
and
additional
costs.
Bank
Loans
The
fund
invests
in
bank
loans,
which
represent
an
interest
in
amounts
owed
by
a
borrower
to
a
syndicate
of
lenders.
Bank
loans
are
generally
noninvestment
grade
and
often
involve
borrowers
whose
financial
condition
is
highly
leveraged.
The
fund
may
invest
in
fixed
and
floating
rate
loans,
which
may
include
senior
floating
rate
loans;
secured
and
unsecured
loans,
second
lien
or
more
junior
loans;
and
bridge
loans
or
bridge
facilities.
Certain
bank
loans
may
be
revolvers
which
are
a
form
of
senior
bank
debt,
where
the
borrower
can
draw
down
the
credit
of
the
revolver
when
it
needs
cash
and
repays
the
credit
when
the
borrower
has
excess
cash.
Certain
loans
may
be
“covenant-lite”
loans,
which
means
the
loans
contain
fewer
maintenance
covenants
than
other
loans
(in
some
cases,
none)
and
do
not
include
terms
which
allow
the
lender
to
monitor
the
performance
of
the
borrower
and
declare
a
default
if
certain
criteria
are
breached.
As
a
result
of
these
risks,
the
fund’s
exposure
to
losses
may
be
increased.
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
Bank
loans
may
be
in
the
form
of
either
assignments
or
participations.
A
loan
assignment
transfers
all
legal,
beneficial,
and
economic
rights
to
the
buyer,
and
transfer
typically
requires
consent
of
both
the
borrower
and
agent.
In
contrast,
a
loan
participation
generally
entitles
the
buyer
to
receive
the
cash
flows
from
principal,
interest,
and
any
fee
payments
on
a
portion
of
a
loan;
however,
the
seller
continues
to
hold
legal
title
to
that
portion
of
the
loan.
As
a
result,
the
buyer
of
a
loan
participation
generally
has
no
direct
recourse
against
the
borrower
and
is
exposed
to
credit
risk
of
both
the
borrower
and
seller
of
the
participation.
Bank
loans
often
have
extended
settlement
periods,
generally
may
be
repaid
at
any
time
at
the
option
of
the
borrower,
and
may
require
additional
principal
to
be
funded
at
the
borrowers’
discretion
at
a
later
date
(e.g.
unfunded
commitments
and
revolving
debt
instruments).
Until
settlement,
the
fund
maintains
liquid
assets
sufficient
to
settle
its
unfunded
loan
commitments.
The
fund
reflects
both
the
funded
portion
of
a
bank
loan
as
well
as
its
unfunded
commitment
in
the
Portfolio
of
Investments.
However,
if
a
credit
agreement
provides
no
initial
funding
of
a
tranche,
and
funding
of
the
full
commitment
at
a
future
date(s)
is
at
the
borrower’s
discretion
and
considered
uncertain,
a
loan
is
reflected
in
the
Portfolio
of
Investments
only
if,
and
only
to
the
extent
that,
the
fund
has
actually
settled
a
funding
commitment.
Other
Purchases
and
sales
of
portfolio
securities
other
than
in-kind
transactions,
if
any,
short-term and
U.S.
government
securities
aggregated $39,844,000 and
$145,000,
respectively,
for
the
period ended
December
31,
2023.
Purchases
and
sales
of
U.S.
government
securities
aggregated
$9,637,000 and
$0,
respectively,
for
the
period ended
December
31,
2023.
NOTE
5
-
FEDERAL
INCOME
TAXES
Generally,
no
provision
for
federal
income
taxes
is
required
since
the
fund
intends
to qualify
as
a
regulated
investment
company
under
Subchapter
M
of
the
Internal
Revenue
Code
and
distribute
to
shareholders
all
of
its taxable
income
and
gains.
Distributions
determined
in
accordance
with
federal
income
tax
regulations
may
differ
in
amount
or
character
from
net
investment
income
and
realized
gains
for
financial
reporting
purposes.
The
fund
files
U.S.
federal,
state,
and
local
tax
returns
as
required.
The
fund’s
tax
returns
are
subject
to
examination
by
the
relevant
tax
authorities
until
expiration
of
the
applicable
statute
of
limitations,
which
is
generally
three
years
after
the
filing
of
the
tax
return
but
which
can
be
extended
to
six
years
in
certain
circumstances.
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
Capital
accounts
within
the
financial
reporting
records
are
adjusted
for
permanent
book/tax
differences
to
reflect
tax
character
but
are
not
adjusted
for
temporary
differences.
The
permanent
book/tax
adjustments,
if
any,
have
no
impact
on
results
of
operations
or
net
assets.
The
tax
character
of
distributions
paid
for
the
periods
presented
was
as
follows:
At
December
31,
2023,
the
tax-basis
cost
of
investments
(including
derivatives,
if
any)
and
gross
unrealized
appreciation
and
depreciation
were as
follows:
At
December
31,
2023,
the
tax-basis
components
of
accumulated
net
earnings
(loss)
were
as
follows:
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
purposes
versus
for
tax
purposes;
these
differences
will
reverse
in
a
subsequent
reporting
period.
The
temporary
differences
relate
primarily
to
the
deferral
of
losses
from
wash
sales.
($000s)
December
31,
2023
Ordinary
income
(including
short-term
capital
gains,
if
any)
$
115
($000s)
Cost
of
investments
$
59,183
Unrealized
appreciation
$
1,118
Unrealized
depreciation
(78)
Net
unrealized
appreciation
(depreciation)
$
1,040
($000s)
Undistributed
ordinary
income
$
6
Net
unrealized
appreciation
(depreciation)
1,040
Total
distributable
earnings
(loss)
$
1,046
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
NOTE
6
-
RELATED
PARTY
TRANSACTIONS
The
fund
is
managed
by
T.
Rowe
Price
Associates,
Inc.
(Price
Associates),
a
wholly
owned
subsidiary
of
T.
Rowe
Price
Group,
Inc.
(Price
Group). Price
Associates
has
entered
into
a
sub-advisory
agreement(s)
with
one
or
more
of
its
wholly
owned
subsidiaries,
to
provide
investment
advisory
services
to
the
fund.
The
investment
management
agreement
between
the
fund
and
Price
Associates
provides
for
an
annual
investment
management
fee,
which
is
computed
daily
and
paid
monthly. The
fee
consists
of
an
individual
fund
fee,
equal
to
0.16%
of
the
fund’s
average
daily
net
assets,
and
a
group
fee.
The
group
fee
rate
is
calculated
based
on
the
combined
net
assets
of
certain
mutual
funds
sponsored
by
Price
Associates
(the
group)
applied
to
a
graduated
fee
schedule,
with
rates
ranging
from
0.48%
for
the
first
$1
billion
of
assets
to
0.260%
for
assets
in
excess
of
$845
billion.
The
fund’s
group
fee
is
determined
by
applying
the
group
fee
rate
to
the
fund’s
average
daily
net
assets. At
December
31,
2023,
the
effective
annual
group
fee
rate
was
0.29%.
The Investor Class is
subject
to
a
contractual
expense
limitation
through
the
expense
limitation
date
indicated
in
the
table
below.
During
the
limitation
period,
Price
Associates
is required
to
waive or
pay
any
expenses
(excluding
interest;
expenses
related
to
borrowings,
taxes,
and
brokerage;
non-recurring,
extraordinary expenses;
and
acquired
fund
fees
and
expenses) that
would
otherwise
cause
the
class’s
ratio
of
annualized
total
expenses
to
average
net
assets
(net
expense
ratio)
to
exceed
its
expense
limitation.
The
class
is
required
to
repay
Price
Associates
for
expenses
previously
waived/paid
to
the
extent
the
class’s
net
assets
grow
or
expenses
decline
sufficiently
to
allow
repayment
without
causing
the
class’s
net
expense
ratio
(after
the
repayment
is
taken
into
account)
to
exceed
the
lesser
of:
(1)
the
expense
limitation
in
place
at
the
time
such
amounts
were
waived;
or
(2)
the
class’s
current
expense
limitation.
However,
no
repayment
will
be
made
more
than
three
years
after
the
date
of
a
payment
or
waiver.
The
I
Class
is
also
subject
to
an
operating
expense
limitation
(I
Class
Limit)
pursuant
to
which
Price
Associates
is
contractually
required
to
pay
all
operating
expenses
of
the
I
Class,
excluding
management
fees;
interest;
expenses
related
to
borrowings,
taxes,
and
brokerage; non-recurring,
extraordinary expenses; and
acquired
fund
fees
and
expenses, to
the
extent
such
operating
expenses,
on
an
annualized
basis,
exceed
the
I
Class
Limit. This
agreement
will
continue
through
the
expense
limitation
date
indicated
in
the
table
below,
and
may
be
renewed,
revised,
or
revoked
only
with
approval
of
the
fund’s
Board.
The
I
Class
is
required
to
repay
Price
Associates
for
expenses
previously
paid
to
the
extent
the
class’s
net
assets
grow
or
expenses
decline
sufficiently
to
allow
repayment
without
causing
the
class’s
operating
expenses
(after
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
the
repayment
is
taken
into
account)
to
exceed
the
lesser
of:
(1)
the
I
Class
Limit
in
place
at
the
time
such
amounts
were
paid;
or
(2)
the
current
I
Class
Limit.
However,
no
repayment
will
be
made
more
than
three
years
after
the
date
of
a
payment
or
waiver.
Pursuant
to
these
agreements,
expenses
were
waived/paid
by
and/or
repaid
to
Price
Associates
during
the
period ended December
31,
2023
as
indicated
in
the
table
below.
At
December
31,
2023,
there
were
no
amounts
subject
to
repayment
by
the
fund.
Any
repayment
of
expenses
previously
waived/paid
by
Price
Associates
during
the
period
would
be
included
in
the
net
investment
income
and
expense
ratios
presented
on
the
accompanying
Financial
Highlights.
In
addition,
the
fund
has
entered
into
service
agreements
with
Price
Associates
and
a
wholly
owned
subsidiary
of
Price
Associates,
each
an
affiliate
of
the
fund
(collectively,
Price).
Price
Associates
provides
certain
accounting
and
administrative
services
to
the
fund.
T.
Rowe
Price
Services,
Inc.
provides
shareholder
and
administrative
services
in
its
capacity
as
the
fund’s
transfer
and
dividend-disbursing
agent.
For
the
period
ended
December
31,
2023,
expenses
incurred
pursuant
to
these
service
agreements
were
$8,000
for
Price
Associates
and
less
than
$1,000
for
T.
Rowe
Price
Services,
Inc.
All
amounts
due
to
and
due
from
Price,
exclusive
of
investment
management
fees
payable,
are
presented
net
on
the
accompanying
Statement
of
Assets
and
Liabilities.
T.
Rowe
Price
Investment
Services,
Inc.
(Investment
Services)
serves
as
distributor
to
the
fund.
Pursuant
to
an
underwriting
agreement,
no
compensation
for
any
distribution
services
provided
is
paid
to
Investment
Services
by
the
fund
(except
for
12b-1
fees
under
a
Board-approved
Rule
12b-1
plan).
The fund
may
invest
its
cash
reserves
in
certain
open-end
management
investment
companies
managed
by
Price
Associates
and
considered
affiliates
of
the
fund:
the
T.
Rowe
Price
Government
Reserve
Fund
or
the
T.
Rowe
Price
Treasury
Reserve
Fund,
organized
as
money
market
funds
(together,
the
Price
Reserve
Funds).
The
Price
Reserve
Funds
are
offered
as
short-term
investment
options
to
mutual
funds,
trusts,
and
other
accounts
managed
by
Price
Associates
or
its
affiliates
and
are
not
available
for
direct
purchase
by
members
of
the
public.
Cash
collateral
from
securities
lending,
if
any,
is
invested
in
the
T.
Rowe
Price
Government
Reserve Fund. The
Price
Reserve
Funds
pay
no
investment
management
fees.
Investor
Class
I
Class
Expense
limitation/I
Class
Limit
0.65%
0.05%
Expense
limitation
date
04/30/25
04/30/25
(Waived)/repaid
during
the
period
($000s)
$(5)
$(6)
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
As
of
December
31,
2023,
T.
Rowe
Price
Group,
Inc.,
or
its
wholly
owned
subsidiaries,
owned
500,000
shares
of
the
Investor
Class,
representing
39%
of
the
Investor
Class's
net
assets,
and
500,000
shares
of
the
I
Class,
representing
52%
of
the
I
Class's
net
assets.
The
fund may
participate
in
securities
purchase
and
sale
transactions
with
other
funds
or
accounts
advised
by
Price
Associates
(cross
trades),
in
accordance
with
procedures
adopted
by the
fund’s
Board
and
Securities
and
Exchange
Commission
rules,
which
require,
among
other
things,
that
such
purchase
and
sale
cross
trades
be
effected
at
the
independent
current
market
price
of
the
security.
During
the
period
ended
December
31,
2023,
the
fund
had
no
purchases
or
sales
cross
trades
with
other
funds
or
accounts
advised
by
Price
Associates.
NOTE
7
-
OTHER
MATTERS
Unpredictable
events
such
as
environmental
or
natural
disasters,
war
and
conflict,
terrorism,
geopolitical
events,
and
public
health
epidemics and
similar
public
health
threats
may
significantly
affect
the
economy
and
the
markets
and
issuers
in
which
the fund
invests.
Certain
events
may
cause
instability
across
global
markets,
including
reduced
liquidity
and
disruptions
in
trading
markets,
while
some
events
may
affect
certain
geographic
regions,
countries,
sectors,
and
industries
more
significantly
than
others,
and
exacerbate
other
pre-existing
political,
social,
and
economic
risks.
The
global
outbreak
of
COVID-19
and
the
related
governmental
and
public
responses
have
led
and
may
continue
to
lead
to
increased
market
volatility
and
the
potential
for
illiquidity
in
certain
classes
of
securities
and
sectors
of
the
market
either
in
specific
countries
or
worldwide.
In
February
2022,
Russian
forces
entered
Ukraine
and
commenced
an
armed
conflict,
leading
to
economic
sanctions imposed
on
Russia
that
target certain
of
its
citizens
and
issuers
and
sectors
of
the
Russian
economy,
creating
impacts
on
Russian-related
stocks
and
debt
and
greater
volatility
in
global
markets.
In
March
2023,
the
banking
industry
experienced
heightened
volatility,
which
sparked
concerns
of
potential
broader
adverse
market
conditions.
The
extent
of
impact
of
these
events
on
the
US
and
global
markets
is
highly
uncertain.
These
are
recent
examples
of
global
events
which
may
have
a
negative
impact
on
the
values
of
certain
portfolio
holdings
or
the
fund's
overall
performance.
Management
is
actively
monitoring
the
risks
and
financial
impacts
arising
from
these
events.
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
REPORT
OF
INDEPENDENT
REGISTERED
PUBLIC
ACCOUNTING
FIRM
To
the
Board
of
Directors
of
T.
Rowe
Price
Capital
Appreciation
Fund,
Inc.
and
Shareholders
of
T.
Rowe
Price
Capital
Appreciation
and
Income
Fund
Opinion
on
the
Financial
Statements
We
have
audited
the
accompanying
statement
of
assets
and
liabilities,
including
the
portfolio
of
investments,
of
T.
Rowe
Price
Capital
Appreciation
and
Income
Fund
(one
of
the
funds
constituting
T.
Rowe
Price
Capital
Appreciation
Fund,
Inc.,
referred
to
hereafter
as
the
"Fund")
as
of
December
31,
2023,
and
the
related
statements
of
operations
and
changes
in
net
assets,
including
the
related
notes,
and
the
financial
highlights
for
the
period
November
29,
2023
(inception)
through
December
31,
2023
(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
December
31,
2023,
and
the
results
of
its
operations,
changes
in
its
net
assets,
and
the
financial
highlights
for
the
period
November
29,
2023
(inception)
through
December
31,
2023
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
audit.
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
audit
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.
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
Our
audit
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
audit
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
December
31,
2023
by
correspondence
with
the
custodian,
transfer
agent
and
brokers;
when
replies
were
not
received
from
brokers,
we
performed
other
auditing
procedures.
We
believe
that
our
audit
provides
a
reasonable
basis
for
our
opinion.
/s/
PricewaterhouseCoopers
LLP
Baltimore,
Maryland
February
16,
2024
We
have
served
as
the
auditor
of
one
or
more
investment
companies
in
the
T.
Rowe
Price
group
of
investment
companies
since
1973.
REPORT
OF
INDEPENDENT
REGISTERED
PUBLIC
ACCOUNTING
FIRM
(continued)
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
TAX
INFORMATION
(UNAUDITED)
FOR
THE
TAX
YEAR
ENDED 12/31/23
We
are
providing
this
information
as
required
by
the
Internal
Revenue
Code.
The
amounts
shown
may
differ
from
those
elsewhere
in
this
report
because
of
differences
between
tax
and
financial
reporting
requirements.
For
taxable
non-corporate
shareholders,
$17,000 of
the
fund's
income
represents
qualified
dividend
income
subject
to
a
long-term
capital
gains
tax
rate
of
not
greater
than
20%.
For
corporate
shareholders,
$15,000
of
the
fund's
income
qualifies
for
the
dividends-
received
deduction.
INFORMATION
ON
PROXY
VOTING
POLICIES,
PROCEDURES,
AND
RECORDS
A
description
of
the
policies
and
procedures
used
by
T.
Rowe
Price
funds
to
determine
how
to
vote
proxies
relating
to
portfolio
securities
is
available
in
each
fund’s
Statement
of
Additional
Information.
You
may
request
this
document
by
calling
1-800-225-5132
or
by
accessing
the
SEC’s
website,
sec.gov.
The
description
of
our
proxy
voting
policies
and
procedures
is
also
available
on
our
corporate
website.
To
access
it,
please
visit
the
following
Web
page:
https://www.troweprice.com/corporate/us/en/utility/policies.html
Scroll
down
to
the
section
near
the
bottom
of
the
page
that
says,
“Proxy
Voting
Guidelines.”
Click
on
the
links
in
the
shaded
box.
Each
fund’s
most
recent
annual
proxy
voting
record
is
available
on
our
website
and
through
the
SEC’s
website.
To
access
it
through
T.
Rowe
Price,
visit
the
website
location
shown
above,
and
scroll
down
to
the
section
near
the
bottom
of
the
page
that
says,
“Proxy
Voting
Records.”
Click
on
the
Proxy
Voting
Records
link
in
the
shaded
box.
HOW
TO
OBTAIN
QUARTERLY
PORTFOLIO
HOLDINGS
The
fund
files
a
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
reports
on
Form
N-PORT
are
available
electronically
on
the
SEC’s
website
(sec.gov).
In
addition,
most
T.
Rowe
Price
funds
disclose
their
first
and
third
fiscal
quarter-end
holdings
on
troweprice.com
.
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
TAILORED
SHAREHOLDER
REPORTS
FOR
MUTUAL
FUNDS
AND
EXCHANGE
TRADED
FUNDS
In
October
2022,
the
Securities
and
Exchange
Commission
(SEC)
adopted
rule
and
form
amendments
requiring
Mutual
Funds
and
Exchange-Traded
Funds
to
transmit
concise
and
visually
engaging
streamlined
annual
and
semiannual
reports
that
highlight
key
information
to
shareholders.
Other
information,
including
financial
statements,
will
no
longer
appear
in
the
funds’
shareholder
reports
but
will
be
available
online,
delivered
free
of
charge
upon
request,
and
filed
on
a
semiannual
basis
on
Form
N-CSR.
The
rule
and
form
amendments
have
a
compliance
date
of
July
24,
2024.
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
APPROVAL
OF
INVESTMENT
MANAGEMENT
AGREEMENT
AND
SUBADVISORY
AGREEMENT
At
a
meeting
held
on
May
10,
2023
(Meeting),
the
fund’s
Board
of
Directors
(Board),
including
a
majority
of
the
fund’s
independent
directors,
approved
the
initial
investment
management
agreement
(Advisory
Contract)
between
the
fund
and
its
investment
adviser,
T.
Rowe
Price
Associates,
Inc.
(Adviser),
as
well
as
the
initial
investment
subadvisory
agreement
(Subadvisory
Contract)
that
the
Adviser
entered
into
with
T.
Rowe
Price
Investment
Management,
Inc.
(Subadviser),
on
behalf
of
the
fund.
At
the
Meeting,
the
Board
considered
the
factors
and
reached
the
conclusions
described
below
relating
to
the
selection
of
the
Adviser
and
Subadviser
and
the
approval
of
the
Advisory
Contract
and
Subadvisory
Contract.
The
independent
directors
were
assisted
in
their
evaluation
of
the
Advisory
Contract
and
Subadvisory
Contract
by
independent
legal
counsel
from
whom
they
received
separate
legal
advice
and
with
whom
they
met
separately.
In
considering
and
approving
the
Advisory
Contract
and
Subadvisory
Contract,
the
Board
considered
the
information
it
believed
was
relevant,
including,
but
not
limited
to,
the
information
discussed
below.
The
Board
considered
not
only
the
specific
information
presented
in
connection
with
the
Meeting
but
also
the
knowledge
gained
over
time
through
interactions
with
the
Adviser
and
Subadviser
about
various
topics.
The
Board
also
considered
that
the
Subadviser
has
its
own
investment
platform
and
investment
management
leadership,
and
the
Adviser
and
Subadviser
have
implemented
information
barriers
restricting
the
sharing
of
investment
information
and
voting
activity.
The
Board
meets
regularly
and,
at
each
of
its
meetings,
covers
an
extensive
agenda
of
topics
and
materials
and
considers
factors
that
are
relevant
to
its
annual
consideration
of
the
renewal
of
the
advisory
contracts
for
the
T.
Rowe
Price
funds,
including
performance
and
the
services
and
support
provided
to
the
funds
and
their
shareholders.
Services
Provided
by
the
Adviser
and
Subadviser
The
Board
considered
the
nature,
quality,
and
extent
of
the
services
provided
to
other
T.
Rowe
Price
funds
(and
the
nature,
quality,
and
extent
of
the
services
expected
to
be
provided
to
the
fund)
by
the
Adviser
and
Subadviser.
These
services
include,
but
are
not
limited
to,
directing
the
fund’s
investments
in
accordance
with
its
investment
program
and
the
overall
management
of
the
fund’s
portfolio,
as
well
as
a
variety
of
related
activities,
such
as
financial,
investment
operations,
and
administrative
services;
compliance;
maintaining
the
fund’s
records
and
registrations;
and
shareholder
communications.
However,
the
Board
noted
that
there
are
information
barriers
between
investment
personnel
of
the
Adviser
and
Subadviser
that
restrict
the
sharing
of
certain
information,
such
as
investment
research,
trading,
and
proxy
voting.
The
Board
also
reviewed
the
background
and
experience
of
the
Adviser’s
and
Subadviser’s
senior
management
teams
and
investment
personnel
that
will
be
involved
in
the
management
of
the
fund,
as
well
as
the
Adviser’s
compliance
record.
The
Board
concluded
that
it
was
satisfied
with
the
nature,
quality,
and
extent
of
the
services
to
be
provided
by
the
Adviser
and
Subadviser.
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
Costs,
Benefits,
Economies
of
Scale,
and
Fees
and
Expenses
Since
the
fund
was
approved
for
launch
at
the
Meeting,
the
Board
did
not
review
information
regarding
the
revenues
received
by
the
Adviser
under
the
Advisory
Contract
and
other
benefits
that
the
Adviser
(and
its
affiliates)
may
have
realized,
or
will
realize,
from
its
relationship
with
the
fund.
Under
the
Advisory
Contract,
the
fund
will
pay
the
Adviser
for
investment
management
services
composed
of
two
components—a
group
fee
rate
based
on
the
combined
average
net
assets
of
most
of
the
T.
Rowe
Price
funds
(including
the
fund)
that
declines
at
certain
asset
levels
and
an
individual
fund
fee
rate
based
on
the
fund’s
average
daily
net
assets—and
the
fund
pays
its
own
expenses
of
operations.
Under
the
Subadvisory
Contract,
the
Adviser
may
pay
the
Subadviser
up
to
60%
of
the
advisory
fees
that
the
Adviser
receives
from
the
fund.
The
group
fee
rate
decreases
as
total
T.
Rowe
Price
fund
assets
grow,
which
reduces
the
management
fee
rate
for
any
fund
that
has
a
group
fee
component
to
its
management
fee,
and
reflects
that
certain
resources
utilized
to
operate
the
fund
are
shared
with
other
T.
Rowe
Price
funds,
thus
allowing
shareholders
of
those
funds
to
share
potential
economies
of
scale.
The
fund
is
also
subject
to
contractual
expense
limitations
that
require
the
Adviser
to
waive
its
fees
and/or
bear
any
expenses
that
would
otherwise
cause
the
expenses
of
a
share
class
of
the
fund
to
exceed
a
certain
percentage
based
on
the
class’s
net
assets.
The
expense
limitations
mitigate
the
potential
for
relatively
high
operating
expenses
until
the
fund
achieves
greater
scale.
In
connection
with
its
approval
of
the
initial
Advisory
Contract
and
Subadvisory
Contract,
the
Board
was
provided
with
information
regarding
industry
trends
in
management
fees
and
expenses
and
the
Board
reviewed
comparisons
of
the
fund’s
proposed
fee
structure
relative
to
similarly
managed
competitor
funds
and
T.
Rowe
Price
funds.
On
the
basis
of
the
information
provided
and
the
factors
considered,
the
Board
concluded
that
the
fee
structure
was
reasonable
and
appropriate.
Approval
of
the
Advisory
Contract
and
Subadvisory
Contract
As
noted,
at
the
Meeting,
the
Board
approved
the
initial
Advisory
Contract
and
Subadvisory
Contract
for
the
fund.
No
single
factor
was
considered
in
isolation
or
to
be
determinative
to
the
decision.
Rather,
the
Board
concluded,
in
light
of
a
weighting
and
balancing
of
all
factors
considered,
that
it
was
in
the
best
interests
of
the
fund
and
its
future
shareholders
for
the
Board
to
approve
the
Advisory
Contract
and
Subadvisory
Contract
(including
the
fees
to
be
charged
for
services
thereunder).
APPROVAL
OF
INVESTMENT
MANAGEMENT
AGREEMENT
AND
SUBADVISORY
AGREEMENT
(continued)
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
ABOUT
THE
FUND'S
DIRECTORS
AND
OFFICERS
Your
fund
is
overseen
by
a
Board
of
Directors
(Board)
that
meets
regularly
to
review
a
wide
variety
of
matters
affecting
or
potentially
affecting
the
fund,
including
performance,
investment
programs,
compliance
matters,
advisory
fees
and
expenses,
service
providers,
and
business
and
regulatory
affairs.
The
Board
elects
the
fund’s
officers,
who
are
listed
in
the
final
table.
The
directors
who
are
also
employees
or
officers
of
T.
Rowe
Price
are
considered
to
be
“interested”
directors
as
defined
in
Section
2(a)(19)
of
the
1940
Act
because
of
their
relationships
with
T.
Rowe
Price
Associates,
Inc. (T.
Rowe
Price),
and
its
affiliates.
The
business
address
of
each
director
and
officer
is
100
East
Pratt
Street,
Baltimore,
Maryland
21202.
The
Statement
of
Additional
Information
includes
additional
information
about
the
fund
directors
and
is
available
without
charge
by
calling
a
T.
Rowe
Price
representative
at
1-800-638-5660.
INDEPENDENT
DIRECTORS
(a)
Name
(Year
of
Birth)
Year
Elected
[Number
of
T.
Rowe
Price
Portfolios
Overseen]
Principal
Occupation(s)
and
Directorships
of
Public
Companies
and
Other
Investment
Companies
During
the
Past
Five
Years
Teresa
Bryce
Bazemore
(1959)
2018
[209]
President
and
Chief
Executive
Officer,
Federal
Home
Loan
Bank
of
San
Francisco
(2021
to
present);
Chief
Executive
Officer,
Bazemore
Consulting
LLC
(2018
to
2021);
Director,
Chimera
Investment
Corporation
(2017
to
2021);
Director,
First
Industrial
Realty
Trust
(2020
to
present);
Director,
Federal
Home
Loan
Bank
of
Pittsburgh
(2017
to
2019)
Melody
Bianchetto
(1966)
2023
[209]
Vice
President
for
Finance,
University
of
Virginia
(2015
to
2023)
Bruce
W.
Duncan
(1951)
2013
[209]
President,
Chief
Executive
Officer,
and
Director,
CyrusOne,
Inc.
(2020
to
2021);
Chair
of
the
Board
(2016
to
2020)
and
President
(2009
to
2016),
First
Industrial
Realty
Trust,
owner
and
operator
of
industrial
properties;
Member,
Investment
Company
Institute
Board
of
Governors
(2017
to
2019);
Member,
Independent
Directors
Council
Governing
Board
(2017
to
2019);
Senior
Advisor,
KKR
(2018
to
2022);
Director,
Boston
Properties
(2016
to
present);
Director,
Marriott
International,
Inc.
(2016
to
2020)
Robert
J.
Gerrard,
Jr.
(1952)
2012
[209]
Chair
of
the
Board,
all
funds
(July
2018
to
present)
Paul
F.
McBride
(1956)
2013
[209]
Advisory
Board
Member,
Vizzia
Technologies
(2015
to
present);
Board
Member,
Dunbar
Armored
(2012
to
2018)
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
INTERESTED DIRECTORS
(a)
Name
(Year
of
Birth)
Year
Elected
[Number
of
T.
Rowe
Price
Portfolios
Overseen]
Principal
Occupation(s)
and
Directorships
of
Public
Companies
and
Other
Investment
Companies
During
the
Past
Five
Years
Mark
J.
Parrell
(1966)
2023
[209]
Board
of
Trustees
Member
and
Chief
Executive
Officer
(2019
to
present),
President
(2018
to
present),
Executive
Vice
President
and
Chief
Financial
Officer
(2007
to
2018),
and
Senior
Vice
President
and
Treasurer
(2005
to
2007),
EQR;
Member,
Nareit
Dividends
Through
Diversity,
Equity
&
Inclusion
CEO
Council
and
Chair,
Nareit
2021
Audit
and
Investment
Committee
(2021);
Advisory
Board,
Ross
Business
School
at
University
of
Michigan
(2015
to
2016);
Member,
National
Multifamily
Housing
Council
and
served
as
Chair
of
the
Finance
Committee
(2015
to
2016);
Member,
Economic
Club
of
Chicago;
Director,
Brookdale
Senior
Living,
Inc.
(2015
to
2017);
Director,
Aviv
REIT,
Inc.
(2013
to
2015);
Director,
Real
Estate
Roundtable
and
the
2022
Executive
Board
Nareit;
Board
of
Directors
and
Chair
of
the
Finance
Committee,
Greater
Chicago
Food
Depository
Kellye
L.
Walker
(1966)
2021
[209]
Executive
Vice
President
and
Chief
Legal
Officer,
Eastman
Chemical
Company
(April
2020
to
present);
Executive
Vice
President
and
Chief
Legal
Officer,
Huntington
Ingalls
Industries,
Inc.
(January
2015
to
March
2020);
Director,
Lincoln
Electric
Company
(October
2020
to
present)
(a)
All
information
about
the
independent
directors
was
current
as
of
December
31,
2022,
unless
otherwise
indicated,
except
for
the
number
of
portfolios
overseen,
which
is
current
as
of
the
date
of
this
report.
Name
(Year
of
Birth)
Year
Elected
[Number
of
T.
Rowe
Price
Portfolios
Overseen]
Principal
Occupation(s)
and
Directorships
of
Public
Companies
and
Other
Investment
Companies
During
the
Past
Five
Years
David
Oestreicher
(1967)
2018
[209]
Director,
Vice
President,
and
Secretary,
T.
Rowe
Price,
T.
Rowe
Price
Investment
Services,
Inc.,
T.
Rowe
Price
Retirement
Plan
Services,
Inc.,
and
T.
Rowe
Price
Services,
Inc.;
Director
and
Secretary,
T.
Rowe
Price
Investment
Management,
Inc.
(Price
Investment
Management);
Vice
President
and
Secretary,
T.
Rowe
Price
International
(Price
International);
Vice
President,
T.
Rowe
Price
Hong
Kong
(Price
Hong
Kong),
T. Rowe
Price
Japan
(Price
Japan),
and
T.
Rowe
Price
Singapore
(Price
Singapore);
General
Counsel,
Vice
President,
and
Secretary,
T.
Rowe
Price
Group,
Inc.;
Chair
of
the
Board,
Chief
Executive
Officer,
President,
and
Secretary,
T.
Rowe
Price
Trust
Company;
Principal
Executive
Officer
and
Executive
Vice
President,
all
funds
INDEPENDENT
DIRECTORS
(a)
(CONTINUED)
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
OFFICERS
Name
(Year
of
Birth)
Year
Elected
[Number
of
T.
Rowe
Price
Portfolios
Overseen]
Principal
Occupation(s)
and
Directorships
of
Public
Companies
and
Other
Investment
Companies
During
the
Past
Five
Years
Eric
L.
Veiel,
CFA
(1972)
2022
[209]
Director
and
Vice
President,
T.
Rowe
Price;
Vice
President,
T.
Rowe
Price
Group,
Inc.,
and
T.
Rowe
Price
Trust
Company;
Vice
President,
Global
Funds
(a)
All
information
about
the
interested
directors
was
current
as
of
December
31,
2022,
unless
otherwise
indicated,
except
for
the
number
of
portfolios
overseen,
which
is
current
as
of
the
date
of
this
report.
Name
(Year
of
Birth)
Position
Held
With Capital
Appreciation
Fund
Principal
Occupation(s)
Armando
(Dino)
Capasso
(1974)
Chief
Compliance
Officer
and
Vice
President
Chief
Compliance
Officer
and
Vice
President,
T.
Rowe
Price
and
Price
Investment
Management;
Vice
President,
T.
Rowe
Price
Group,
Inc.;
formerly,
Chief
Compliance
Officer,
PGIM
Investments
LLC
and
AST
Investment
Services,
Inc.
(ASTIS)
(to
2022);
Chief
Compliance
Officer,
PGIM
Retail
Funds
complex
and
Prudential
Insurance
Funds
(to
2022);
Vice
President
and
Deputy
Chief
Compliance
Officer,
PGIM
Investments
LLC
and
ASTIS
(to
2019)
Paul
Cho
(1986)
Vice
President
Vice
President,
Price
Investment
Management
and
T.
Rowe
Price
Group,
Inc.
Alan
S.
Dupski,
CPA
(1982)
Principal
Financial
Officer,
Vice
President,
and
Treasurer
Vice
President,
Price
Investment
Management,
T.
Rowe
Price,
T.
Rowe
Price
Group,
Inc.,
and
T.
Rowe
Price
Trust
Company
Donald
J.
Easley,
CFA
(1971)
Vice
President
Vice
President,
Price
Investment
Management
and
T.
Rowe
Price
Group,
Inc.
Cheryl
Emory
(1963)
Assistant
Secretary
Assistant
Vice
President
and
Assistant
Secretary,
T.
Rowe
Price;
Assistant
Secretary,
T.
Rowe
Price
Group,
Inc.,
Price
Investment
Management,
Price
International,
Price
Hong
Kong,
Price
Singapore,
T.
Rowe
Price
Investment
Services,
Inc.,
T.
Rowe
Price
Retirement
Plan
Services,
Inc.,
and
T.
Rowe
Price
Trust
Company
Unless
otherwise
noted,
officers
have
been
employees
of
T.
Rowe
Price
or
Price
International
for
at
least
5
years.
INTERESTED DIRECTORS
(a)
(CONTINUED)
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
Name
(Year
of
Birth)
Position
Held
With Capital
Appreciation
Fund
Principal
Occupation(s)
Matthew
Frustaci
(1990)
Vice
President
Vice
President,
Price
Investment
Management;
formerly,
student,
The
Wharton
School,
University
of
Pennsylvania
(to
2020);
summer
intern,
T.
Rowe
Price
(2019)
David
R.
Giroux,
CFA
(1975)
President
Vice
President,
Price
Investment
Management,
T.
Rowe
Price
Group,
Inc.,
and
T.
Rowe
Price
Trust
Company
Gregg
Gola,
CFA
(1965)
Vice
President
Vice
President,
Price
Investment
Management
and
T.
Rowe
Price
Group,
Inc.
Cheryl
Hampton,
CPA
(1969)
Vice
President
Vice
President,
T.
Rowe
Price,
T.
Rowe
Price
Group,
Inc.,
and
T.
Rowe
Price
Trust
Company;
formerly,
Tax
Director,
Invesco
Ltd.
(to
2021);
Vice
President,
Oppenheimer
Funds,
Inc.
(to
2019)
Benjamin
Kersse,
CPA
(1989)
Vice
President
Vice
President,
T.
Rowe
Price
and
T.
Rowe
Price
Trust
Company
Kevin
Klassen,
CFA
(1997)
Vice
President
Vice
President,
Price
Investment
Management
Steven
D.
Krichbaum
(1977)
Vice
President
Vice
President,
Price
Investment
Management
and
T.
Rowe
Price
Group,
Inc.
Paul
J.
Krug,
CPA
(1964)
Vice
President
Vice
President,
T.
Rowe
Price,
T.
Rowe
Price
Group,
Inc.,
and
T.
Rowe
Price
Trust
Company
Chase
Lancaster,
CFA
(1987)
Vice
President
Vice
President,
T.
Rowe
Price,
T.
Rowe
Price
Group,
Inc.,
and
Price
Investment
Management;
formerly,
Leveraged
Loan
Trader
and
Senior
Credit
Research
Analyst
at
Morgan
Stanley
(to
2016)
Kevin
Patrick
Loome,
CFA
(1967)
Vice
President
Vice
President,
Price
Investment
Management
and
T.
Rowe
Price
Group,
Inc.
Amanda
Ludwitzke
(1990)
Vice
President
Vice
President,
Price
Investment
Management
and
T.
Rowe
Price
Group,
Inc.
Robert
P.
McDavid
(1972)
Vice
President
Vice
President,
T.
Rowe
Price, Price
Investment
Management, T.
Rowe
Price
Investment
Services,
Inc.,
and
T.
Rowe
Price
Trust
Company
Jordan
M.
McKinnie
(1991)
Vice
President
Vice
President,
Price
Investment
Management
and
T.
Rowe
Price
Group,
Inc.
Justin
Eric
Olsen
(1988)
Vice
President
Vice
President,
Price
Investment
Management
and
T.
Rowe
Price
Group,
Inc.
Unless
otherwise
noted,
officers
have
been
employees
of
T.
Rowe
Price
or
Price
International
for
at
least
5
years.
T.
ROWE
PRICE
Capital
Appreciation
and
Income
Fund
Name
(Year
of
Birth)
Position
Held
With Capital
Appreciation
Fund
Principal
Occupation(s)
Simon
Paterson
(1978)
Vice
President
Vice
President,
Price
Investment
Management
and
T.
Rowe
Price
Group,
Inc.;
formerly,
Partner,
Senior
Equity
Analyst,
Brown
Advisory
(to
2020)
Fran
M.
Pollack-Matz
(1961)
Vice
President
and
Secretary
Vice
President,
T.
Rowe
Price,
T.
Rowe
Price
Group,
Inc.,
T.
Rowe
Price
Investment
Services,
Inc., T.
Rowe
Price
Services,
Inc.,
and
T.
Rowe
Price
Trust
Company
Sal
Rais,
M.D.,
CFA
(1983)
Vice
President
Vice
President,
Price
Investment
Management
and
T.
Rowe
Price
Group,
Inc.;
formerly,
Research
Analyst,
Rock
Springs
Capital
L.P.
(to
2021);
Senior
Analyst,
Nexthera
Capital
L.P.
(to
2019)
Vivek
Rajeswaran
(1985)
Vice
President
Vice
President,
Price
Investment
Management
and
T.
Rowe
Price
Group,
Inc.
Richard
Sennett,
CPA
(1970)
Assistant
Treasurer
Vice
President,
T.
Rowe
Price,
T.
Rowe
Price
Group,
Inc.,
and
T.
Rowe
Price
Trust
Company
Nikhil
Shah
(1996)
Vice
President
Vice
President, Price
Investment
Management
Farris
G.
Shuggi
(1984)
Vice
President
Vice
President,
Price
Investment
Management
and
T.
Rowe
Price
Group,
Inc.
Mike
Signore
(1987)
Vice
President
Vice
President,
Price
Investment
Management
and
T.
Rowe
Price
Group,
Inc.
Brian
Solomon,
CFA
(1986)
Vice
President
Vice
President,
Price
Investment
Management
and
T.
Rowe
Price
Group,
Inc.
Matthew
Stevenson
(1991)
Vice
President
Vice
President,
Price
Investment
Management
and
T.
Rowe
Price
Group,
Inc.;
formerly,
student,
Columbia
Business
School
(to
2019)
Chen
Tian
(1993)
Vice
President
Vice
President,
Price
Investment
Management
and
T.
Rowe
Price
Group,
Inc.
Tamara
P.
Wiggs
(1979)
Vice
President
Vice
President,
Price
Investment
Management
and
T.
Rowe
Price
Group,
Inc.
Jon
Davis
Wood,
CFA
(1979)
Vice
President
Vice
President,
Price
Investment
Management
and
T.
Rowe
Price
Group,
Inc.
Ashley
R.
Woodruff,
CFA
(1979)
Vice
President
Vice
President,
Price
Investment
Management
and
T.
Rowe
Price
Group,
Inc.
Ellen
York
(1988)
Vice
President
Vice
President,
Price
Investment
Management
and
T.
Rowe
Price
Unless
otherwise
noted,
officers
have
been
employees
of
T.
Rowe
Price
or
Price
International
for
at
least
5
years.
100
East
Pratt
Street
Baltimore,
MD
21202
T.
Rowe
Price
Investment
Services,
Inc.
Call
1-800-225-5132
to
request
a
prospectus
or
summary
prospectus;
each
includes
investment
objectives,
risks,
fees,
expenses,
and
other
information
that
you
should
read
and
consider
carefully
before
investing.
202402-3281522
F1577-050
2/24
Item 1. (b) Notice pursuant to Rule 30e-3.
Not applicable.
Item 2. Code of Ethics.
The registrant has adopted a code of ethics, as defined in Item 2 of Form N-CSR, applicable to its principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. A copy of this code of ethics is filed as an exhibit to this Form N-CSR. No substantive amendments were approved or waivers were granted to this code of ethics during the period covered by this report.
Item 3. Audit Committee Financial Expert.
The registrant’s Board of Directors has determined that Mr. Paul F. McBride qualifies as an audit committee financial expert, as defined in Item 3 of Form N-CSR. Mr. McBride is considered independent for purposes of Item 3 of Form N-CSR.
Item 4. Principal Accountant Fees and Services.
(a) – (d) Aggregate fees billed for the last two fiscal years for professional services rendered to, or on behalf of, the registrant by the registrant’s principal accountant were as follows:
| | | | | | | | | | | | | | |
| | | | 2023 | | | | | | 2022 | |
| | Audit Fees | | $ | 24,638 | | | | | | | | $ | |
| | Audit-Related Fees | | | - | | | | | | | | | |
| | Tax Fees | | | - | | | | | | | | | |
| | All Other Fees | | | - | | | | | | | | | |
Audit fees include amounts related to the audit of the registrant’s annual financial statements and services normally provided by the accountant in connection with statutory and regulatory filings. Audit-related fees include amounts reasonably related to the performance of the audit of the registrant’s financial statements and specifically include the issuance of a report on internal controls and, if applicable, agreed-upon procedures related to fund acquisitions. Tax fees include amounts related to services for tax compliance, tax planning, and tax advice. The nature of these services specifically includes the review of distribution calculations and the preparation of Federal, state, and excise tax returns. All other fees include the registrant’s pro-rata share of amounts for agreed-upon procedures in conjunction with service contract approvals by the registrant’s Board of Directors/Trustees.
(e)(1) The registrant’s audit committee has adopted a policy whereby audit and non-audit services performed by the registrant’s principal accountant for the registrant, its investment adviser, and any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the registrant require pre-approval in advance at regularly scheduled audit committee meetings. If such a service is required between regularly scheduled audit committee meetings, pre-approval may be authorized by one audit committee member with ratification at the next scheduled audit committee meeting. Waiver of pre-approval for audit or non-audit services requiring fees of a de minimis amount is not permitted.
(2) No services included in (b) – (d) above were approved pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.
(f) Less than 50 percent of the hours expended on the principal accountant’s engagement to audit the registrant’s financial statements for the most recent fiscal year were attributed to work performed by persons other than the principal accountant’s full-time, permanent employees.
(g) The aggregate fees billed for the most recent fiscal year and the preceding fiscal year by the registrant’s principal accountant for non-audit services rendered to the registrant, its investment adviser, and any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the registrant were $1,524,000 and $2,037,000, respectively.
(h) All non-audit services rendered in (g) above were pre-approved by the registrant’s audit committee. Accordingly, these services were considered by the registrant’s audit committee in maintaining the principal accountant’s independence.
Item 5. Audit Committee of Listed Registrants.
Not applicable.
Item 6. Investments.
(a) Not applicable. The complete schedule of investments is included in Item 1 of this Form N-CSR.
(b) Not applicable.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.
Not applicable.
Item 8. Portfolio Managers of Closed-End Management Investment Companies.
Not applicable.
Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.
Not applicable.
Item 10. Submission of Matters to a Vote of Security Holders.
There has been no change to the procedures by which shareholders may recommend nominees to the registrant’s board of directors.
Item 11. Controls and Procedures.
(a) The registrant’s principal executive officer and principal financial officer have evaluated the registrant’s disclosure controls and procedures within 90 days of this filing and have concluded that the registrant’s disclosure controls and procedures were effective, as of that date, in ensuring that information required to be disclosed by the registrant in this Form N-CSR was recorded, processed, summarized, and reported timely.
(b) The registrant’s principal executive officer and principal financial officer are aware of no change in the registrant’s internal control over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.
Item 12. Disclosure of Securities Lending Activities for Closed-End Management Investment Companies.
Not applicable.
Item 13. Exhibits.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
T. Rowe Price Capital Appreciation Fund, Inc.
| | | | |
| By | | /s/ David Oestreicher | | |
| | David Oestreicher | | |
| | Principal Executive Officer | | |
| | |
| Date | | February 16, 2024 | | |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
| | | | |
| By | | /s/ David Oestreicher | | |
| | David Oestreicher | | |
| | Principal Executive Officer | | |
| | |
| Date | | February 16, 2024 | | |
| | | | |
| By | | /s/ Alan S. Dupski | | |
| | Alan S. Dupski | | |
| | Principal Financial Officer | | |
| | |
| Date | | February 16, 2024 | | |
