United States
Securities and Exchange Commission
Washington, D.C. 20549
Form N-CSR
Certified Shareholder Report of
Registered Management Investment Companies
811-2993
(Investment Company Act File Number)
Edward Jones Money Market Fund
---------------------------------------------------------------
(Exact Name of Registrant as Specified in Charter)
Federated Investors Funds
5800 Corporate Drive
Pittsburgh, Pennsylvania 15237-7000
(412) 288-1900
(Registrant's Telephone Number)
John W. McGonigle, Esquire
Federated Investors Tower
1001 Liberty Avenue
Pittsburgh, Pennsylvania 15222-3779
(Name and Address of Agent for Service)
(Notices should be sent to the Agent for Service)
Date of Fiscal Year End: 2/28/2006
Date of Reporting Period: Fiscal year ended 2/28/06
-------------------------
Item 1. Reports to Stockholders
EdwardJones
Edward Jones Money Market Fund
ANNUAL SHAREHOLDER REPORT
February 28, 2006
Investment Shares
Retirement Shares
FINANCIAL HIGHLIGHTS
SHAREHOLDER EXPENSE EXAMPLE
PORTFOLIO OF INVESTMENTS SUMMARY TABLES
PORTFOLIO OF INVESTMENTS
STATEMENT OF ASSETS AND LIABILITIES
STATEMENT OF OPERATIONS
STATEMENT OF CHANGES IN NET ASSETS
NOTES TO FINANCIAL STATEMENTS
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
BOARD OF TRUSTEES AND FUND OFFICERS
BOARD REVIEW OF ADVISORY CONTRACT
VOTING PROXIES ON FUND PORTFOLIO SECURITIES
QUARTERLY PORTFOLIO SCHEDULE
Serving Individual Investors Since 1871
Not FDIC Insured * May Lose Value * No Bank Guarantee
Financial Highlights - Investment Shares
(For a Share Outstanding Throughout Each Period)
Year Ended February 28 or 29
|
| 2006
|
|
| 2005
|
|
| 2004
|
|
| 2003
|
|
| 2002
|
|
Net Asset Value, Beginning of Period
| | $1.00 | | | $1.00 | | | $1.00 | | | $1.00 | | | $1.00 | |
Income From Investment Operations:
| | | | | | | | | | | | | | | |
Net investment income
| | 0.027 | | | 0.008 | | | 0.003 | | | 0.010 | | | 0.027 | |
Less Distributions:
| | | | | | | | | | | | | | | |
Distributions from net investment income
|
| (0.027
| )
|
| (0.008
| )
|
| (0.003
| )
|
| (0.010
| )
|
| (0.027
| )
|
Net Asset Value, End of Period
|
| $1.00
|
|
| $1.00
|
|
| $1.00
|
|
| $1.00
|
|
| $1.00
|
|
Total Return 1
|
| 2.77
| %
|
| 0.77
| %
|
| 0.30
| %
|
| 0.97
| %
|
| 2.75
| %
|
| | | | | | | | | | | | | | | |
Ratios to Average Net Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net expenses
|
| 0.84
| %
|
| 0.83
| %
|
| 0.86
| %
|
| 0.84
| %
|
| 0.83
| %
|
Net investment income
|
| 2.79
| %
|
| 0.76
| %
|
| 0.30
| %
|
| 0.96
| %
|
| 2.75
| %
|
Expense waiver/reimbursement 2
|
| 0.00
| % 3
|
| 0.00
| % 3
|
| 0.00
| % 3
|
| - --
|
|
| - --
|
|
Supplemental Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net assets, end of period (000 omitted)
|
| $9,659,931
|
| $7,770,049
|
| $8,134,397
|
| $9,090,066
|
| $9,722,644
|
|
1 Based on net asset value. Total returns for periods of less than one year are not annualized.
2 This expense decrease is reflected in both the net expense and net investment income ratios shown above.
3 Represents less than 0.01%.
See Notes which are an integral part of the Financial Statements
Financial Highlights - Retirement Shares
(For a Share Outstanding Throughout Each Period)
| | Year Ended February 28 or 29,
| | Period
Ended | |
|
| 2006
|
|
| 2005
|
|
| 2004
|
|
| 2003
|
|
| 2/28/2002
| 1
|
Net Asset Value, Beginning of Period
| | $1.00 | | | $1.00 | | | $1.00 | | | $1.00 | | | $1.00 | |
Income From Investment Operations:
| | | | | | | | | | | | | | | |
Net investment income
| | 0.023 | | | 0.004 | | | 0.001 | | | 0.005 | | | 0.014 | |
Less Distributions:
| | | | | | | | | | | | | | | |
Distributions from net investment income
|
| (0.023
| )
|
| (0.004
| )
|
| (0.001
| )
|
| (0.005
| )
|
| (0.014
| )
|
Net Asset Value, End of Period
|
| $1.00
|
|
| $1.00
|
|
| $1.00
|
|
| $1.00
|
|
| $1.00
|
|
Total Return 2
|
| 2.31
| %
|
| 0.41
| %
|
| 0.08
| %
|
| 0.50
| %
|
| 1.41
| %
|
| | | | | | | | | | | | | | | |
Ratios to Average Net Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net expenses
|
| 1.29
| %
|
| 1.19
| %
|
| 1.08
| %
|
| 1.30
| %
|
| 1.30
| % 3
|
Net investment income
|
| 2.28
| %
|
| 0.40
| %
|
| 0.08
| %
|
| 0.49
| %
|
| 1.78
| % 3
|
Expense waiver/reimbursement 4
|
| 0.02
| %
|
| 0.11
| %
|
| 0.12
| %
|
| - --
|
|
| - --
|
|
Supplemental Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net assets, end of period (000 omitted)
|
| $2,328,836
|
| $2,179,354
|
| $2,254,070
|
| $2,235,185
|
| $1,826,666
|
|
1 Reflects operations for the period from May 21, 2001 (date of initial public investment) to February 28, 2002.
2 Based on net asset value. Total returns for periods of less than one year are not annualized.
3 Computed on annualized basis.
4 This expense decrease is reflected in both the net expense and net investment income ratios shown above.
See Notes which are an integral part of the Financial Statements
Shareholder Expense Example
As a shareholder of the Fund, you incur ongoing costs, including management fees, shareholder services fees, and other Fund expenses. This Example is intended to help you to 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. It is based on an investment of $1,000 invested at the beginning of the period and held for the entire period from September 1, 2005 to February 28, 2006.
ACTUAL EXPENSES
The first section of the table below provides information about actual account values and actual expenses. You may use the information in this section, together with the amount you invested, to estimate the expenses that you incurred 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 in the first section under the heading entitled "Expenses Paid During Period" to estimate the expenses attributable to your investment during this period.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The second section of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return. Thus, you should not use the hypothetical account values and expenses to estimate the actual ending account balance or your expenses for the period. Rather, these figures are provided to enable you to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only. Therefore, the second section of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds.
|
| Beginning
Account Value
9/1/2005
|
| Ending
Account Value
2/28/2006
|
| Expenses Paid
During Period 1
|
Actual:
|
|
|
|
|
|
|
Investment Shares
|
| $1,000
|
| $1,016.40
|
| $4.10
|
Retirement Shares
|
| $1,000
|
| $1,013.80
|
| $6.64
|
Hypothetical (assuming a 5% return before expenses):
|
|
|
|
|
|
|
Investment Shares
|
| $1,000
|
| $1,020.73
|
| $4.11
|
Retirement Shares
|
| $1,000
|
| $1,018.20
|
| $6.66
|
1 Expenses are equal to the Fund's annualized net expense ratios, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period). The annualized net expense ratios are as follows:
Investment Shares
|
| 0.82%
|
Retirement Shares
|
| 1.33%
|
Portfolio of Investments Summary Tables
At February 28, 2006, the Fund's portfolio composition 1 was as follows:
|
| Percentage of
Total Net Assets
|
Repurchase Agreements
|
| 80.7%
|
U.S. Government Agency Securities
|
| 16.5%
|
Other Assets and Liabilities--Net 2
|
| 2.8%
|
TOTAL
|
| 100.0%
|
At February 28, 2006, the Fund's effective maturity 3 schedule was as follows:
Securities With an
Effective Maturity of:
|
| Percentage of
Total Net Assets
|
1-7 Days
|
| 56.1%
|
8-30 Days
|
| 20.6%
|
31-90 Days
|
| 15.0%
|
91-180 Days
|
| 2.0%
|
181 Days or more
|
| 3.5%
|
Other Assets and Liabilities--Net 2
|
| 2.8%
|
TOTAL
|
| 100.0%
|
1 See the Fund's Prospectus for a description of the principal types of securities in which the Fund invests.
2 Asset, other than investments in securities, less liabilities. See Statement of Assets and Liabilities.
3 Effective maturity is determined in accordance with the requirements of Rule 2a-7 under the Investment Company Act of 1940, which regulates money market mutual funds.
Portfolio of Investments
February 28, 2006
Principal
Amount
|
|
|
|
| Value
|
| | | GOVERNMENT AGENCIES--16.5% | | | |
| $ | 877,500,000 | 1 | Federal Home Loan Bank System Floating Rate Notes, 4.317% - 4.630%, 2/16/2005 - 3/8/2006
| | $ | 877,245,982 |
| 314,905,000 | | Federal Home Loan Bank System Notes, 2.625% - 4.875%, 5/15/2006 - 2/1/2007
| | | 313,689,727 |
| 224,407,000 | 2 | Federal Home Loan Mortgage Corp. Discount Notes, 4.190% - 4.730%, 9/29/2006 - 2/6/2007
| | | 216,045,339 |
| 395,000,000 | 1 | Federal Home Loan Mortgage Corp. Floating Rate Notes, 4.367% - 4.560%, 3/19/2006 - 5/8/2006
| | | 394,820,835 |
| 171,500,000 | | Federal Home Loan Mortgage Corp. Notes, 2.750% - 5.500%, 7/15/2006 - 10/18/2006
|
|
| 171,375,781
|
| | | TOTAL GOVERNMENT AGENCIES (AMORTIZED COST $1,973,177,664)
|
|
| 1,973,177,664
|
| | | REPURCHASE AGREEMENTS--80.7% | | | |
| 488,000,000 | | Interest in $1,600,000,000 joint repurchase agreement 4.58%, dated 2/28/2006 under which BNP Paribas Securities Corp., will repurchase U.S. Government Agency and U.S. Treasury securities with various maturities to 2/15/2032 for $1,600,203,556 on 3/1/2006. The market value of the underlying securities at the end of the period was $1,632,031,407.
| | | 488,000,000 |
| 570,000,000 | | Interest in $1,500,000,000 joint repurchase agreement 4.58%, dated 2/28/2006 under which Citigroup Global Markets, Inc., will repurchase U.S. Government Agency and U.S. Treasury securities with various maturities to 4/15/2042 for $1,500,190,833 on 3/1/2006. The market value of the underlying securities at the end of the period was $1,530,006,430.
| | | 570,000,000 |
| 950,000,000 | | Interest in $1,050,000,000 joint repurchase agreement 4.58%, dated 2/28/2006 under which Countrywide Securities Corp., will repurchase U.S. Government Agency securities with various maturities to 6/25/2044 for $1,050,133,583 on 3/1/2006. The market value of the underlying securities at the end of the period was $1,071,228,590.
| | | 950,000,000 |
| 128,000,000 | 3 | Interest in $400,000,000 joint repurchase agreement 4.40%, dated 12/13/2005 under which Credit Suisse First Boston LLC, will repurchase U.S. Government Agency securities and a U.S. Treasury security with various maturities to 2/1/2036 for $404,400,000 on 3/13/2006. The market value of the underlying securities at the end of the period was $416,933,019.
| | | 128,000,000 |
Principal
Amount
|
|
|
|
| Value
|
| | | REPURCHASE AGREEMENTS--continued | | | |
| $ | 432,000,000 | 3 | Interest in $750,000,000 joint repurchase agreement 4.52%, dated 1/26/2006 under which Credit Suisse First Boston LLC, will repurchase U.S. Government Agency securities and a U.S. Treasury security with various maturities to 3/1/2036 for $753,766,667 on 3/8/2006. The market value of the underlying securities at the end of the period was $780,875,900.
| | $ | 432,000,000 |
| 200,000,000 | | Interest in $1,750,000,000 joint repurchase agreement 4.53%, dated 2/28/2006 under which Credit Suisse First Boston LLC, will repurchase U.S. Treasury securities with various maturities to 8/15/2029 for $1,750,220,208 on 3/1/2006. The market value of the underlying securities at the end of the period was $1,785,005,490.
| | | 200,000,000 |
| 550,000,000 | 3 | Interest in $1,000,000,000 joint repurchase agreement 4.55%, dated 2/1/2006 under which Credit Suisse First Boston LLC, will repurchase U.S. Government Agency and U.S. Treasury securities with various maturities to 3/1/2036 for $1,007,709,722 on 4/4/2006. The market value of the underlying securities at the end of the period was $1,041,831,909.
| | | 550,000,000 |
| 475,000,000 | | Interest in $1,000,000,000 joint repurchase agreement 4.58%, dated 2/28/2006 under which Credit Suisse First Boston LLC, will repurchase U.S. Government Agency securities with various maturities to 11/1/2035 for $1,000,127,222 on 3/1/2006. The market value of the underlying securities at the end of the period was $1,020,005,834.
| | | 475,000,000 |
| 615,000,000 | 3 | Interest in $1,000,000,000 joint repurchase agreement 4.44%, dated 1/3/2006 under which Deutsche Bank Securities, Inc., will repurchase U.S. Government Agency securities with various maturities to 6/1/2035 for $1,010,360,000 on 3/28/2006. The market value of the underlying securities at the end of the period was $1,030,800,174.
| | | 615,000,000 |
| 238,000,000 | 3 | Interest in $600,000,000 joint repurchase agreement 4.53%, dated 2/3/2006 under which Deutsche Bank Securities, Inc., will repurchase U.S. Government Agency and U.S. Treasury securities with various maturities to 3/1/2036 for $604,001,500 on 3/28/2006. The market value of the underlying securities at the end of the period was $621,328,084.
| | | 238,000,000 |
| 50,000,000 | 3 | Interest in $300,000,000 joint repurchase agreement 4.62%, dated 1/31/2006 under which Deutsche Bank Securities, Inc., will repurchase U.S. Government Agency securities with various maturities to 12/1/2035 for $303,465,000 on 5/1/2006. The market value of the underlying securities at the end of the period was $312,298,550.
| | | 50,000,000 |
| 1,000,000,000 | | $1,000,000,000 repurchase agreement 4.58%, dated 2/28/2006 under which HSBC Securities, Inc., will repurchase U.S. Government Agency securities with various maturities to 2/1/2036 for $1,000,127,222 on 3/1/2006. The market value of the underlying securities at the end of the period was $1,020,004,217.
| | | 1,000,000,000 |
| 59,000,000 | 3 | Interest in $180,000,000 joint repurchase agreement 4.31%, dated 10/28/2005 under which J.P. Morgan Securities, Inc., will repurchase U.S. Government Agency securities with various maturities to 3/25/2036 for $183,167,850 on 3/27/2006. The market value of the underlying securities at the end of the period was $185,400,088.
| | | 59,000,000 |
| 297,966,000 | | Interest in $2,000,000,000 joint repurchase agreement 4.54%, dated 2/28/2006 under which J.P. Morgan Securities, Inc., will repurchase U.S. Treasury securities with various maturities to 2/15/2031 for $2,000,252,222 on 3/1/2006. The market value of the underlying securities at the end of the period was $2,040,047,289.
| | | 297,966,000 |
Principal
Amount
|
|
|
|
| Value
|
| | | REPURCHASE AGREEMENTS--continued | | | |
| $ | 300,000,000 | | Interest in $350,000,000 joint repurchase agreement 4.58%, dated 2/28/2006 under which J.P. Morgan Securities, Inc., will repurchase U.S. Government Agency securities with various maturities to 3/25/2036 for $350,044,528 on 3/1/2006. The market value of the underlying securities at the end of the period was $360,504,531.
| | $ | 300,000,000 |
| 1,000,000,000 | | $1,000,000,000 repurchase agreement 4.58%, dated 2/28/2006 under which Merrill Lynch Government Securities, will repurchase U.S. Government Agency securities with various maturities to 2/15/2036 for $1,000,127,222 on 3/1/2006. The market value of the underlying securities at the end of the period was $1,025,001,830.
| | | 1,000,000,000 |
| 500,000,000 | | Interest in $700,000,000 joint repurchase agreement 4.58%, dated 2/28/2006 under which Morgan Stanley & Co., Inc., will repurchase U.S. Government Agency securities with various maturities to 9/1/2035 for $700,089,056 on 3/1/2006. The market value of the underlying securities at the end of the period was $716,797,383.
| | | 500,000,000 |
| 488,000,000 | 3 | Interest in $950,000,000 joint repurchase agreement 4.46%, dated 1/4/2006 under which UBS Securities LLC, will repurchase U.S. Government Agency securities with various maturities to 3/1/2036 for $960,004,028 on 3/31/2006. The market value of the underlying securities at the end of the period was $975,482,728.
| | | 488,000,000 |
| 386,000,000 | 3 | Interest in $500,000,000 joint repurchase agreement 4.50%, dated 1/23/2006 under which UBS Securities LLC, will repurchase U.S. Government Agency securities with various maturities to 11/1/2035 for $503,937,500 on 3/28/2006. The market value of the underlying securities at the end of the period was $517,005,175.
| | | 386,000,000 |
| 950,000,000 | | Interest in $2,680,000,000 joint repurchase agreement 4.58%, dated 2/28/2006 under which UBS Securities LLC, will repurchase U.S. Government Agency securities with various maturities to 2/1/2036 for $2,680,340,956 on 3/1/2006. The market value of the underlying securities at the end of the period was $2,733,604,201.
|
|
| 950,000,000
|
| | | TOTAL REPURCHASE AGREEMENTS
(AT AMORTIZED COST)
|
|
| 9,676,966,000
|
| | | TOTAL INVESTMENTS--97.2%
(IDENTIFIED COST $11,650,143,664) 4
|
|
| 11,650,143,664
|
| | | OTHER ASSETS AND LIABILITIES - NET--2.8%
|
|
| 338,623,882
|
| | | TOTAL NET ASSETS--100%
|
| $
| 11,988,767,546
|
1 Floating rate note with current rate and next reset date shown.
2 Discount rate at time of purchase.
3 Although the repurchase date is more than seven days after the date of purchase, the fund has the right to terminate the repurchase agreement at any time with seven-days' notice.
4 Also represents cost for federal tax purposes.
Note: The categories of investments are shown as a percentage of total net assets at February 28, 2006.
See Notes which are an integral part of the Financial Statements
Statement of Assets and Liabilities
February 28, 2006
Assets:
| | | | | | | | |
Investments in repurchase agreements
| | $ | 9,676,966,000 | | | | | |
Investments in securities
|
|
| 1,973,177,664
|
|
|
|
|
|
Total investments in securities, at amortized cost and value
| | | | | | $ | 11,650,143,664 | |
Cash
| | | | | | | 219,702 | |
Income receivable
| | | | | | | 27,900,215 | |
Receivable for shares sold
|
|
|
|
|
|
| 340,882,869
|
|
TOTAL ASSETS
|
|
|
|
|
|
| 12,019,146,450
|
|
Liabilities :
| | | | | | | | |
Payable for shares redeemed
| | | 17,670,704 | | | | | |
Income distribution payable
| | | 8,103,706 | | | | | |
Payable for transfer and dividend disbursing agent fees and expenses (Note 5)
| | | 2,018,375 | | | | | |
Payable for shareholders services fee (Note 5)
| | | 2,232,604 | | | | | |
Accrued expenses
|
|
| 353,515
|
|
|
|
|
|
TOTAL LIABILITIES
|
|
|
|
|
|
| 30,378,904
|
|
Net assets for 11,988,841,714 shares outstanding
|
|
|
|
|
| $
| 11,988,767,546
|
|
Net Assets Consist of:
| | | | | | | | |
Paid-in capital
| | | | | | $ | 11,988,841,761 | |
Distributions in excess of net investment income
|
|
|
|
|
|
| (74,215
| )
|
TOTAL NET ASSETS
|
|
|
|
|
| $
| 11,988,767,546
|
|
Net Asset Value, Offering Price and Redemption Proceeds Per Share
| | | | | | | | |
Investment Shares:
| | | | | | | | |
$9,659,931,386 ÷ 9,660,273,234 shares outstanding, no par value, unlimited shares authorized
|
|
|
|
|
|
| $1.00
|
|
Retirement Shares:
| | | | | | | | |
$2,328,836,160 ÷ 2,328,568,480 shares outstanding, no par value, unlimited shares authorized
|
|
|
|
|
|
| $1.00
|
|
See Notes which are an integral part of the Financial Statements
Statement of Operations
Year Ended February 28, 2006
Investment Income:
| | | | | | | | | | | |
Interest
|
|
|
|
|
|
|
|
|
| $
| 377,209,898
|
Expenses:
| | | | | | | | | | | |
Investment adviser fee (Note 5)
| | | | | | $ | 43,041,572 | | | | |
Administrative personnel and services fee (Note 5)
| | | | | | | 8,347,721 | | | | |
Custodian fees
| | | | | | | 290,489 | | | | |
Transfer and dividend disbursing agent fees and expenses--Investment Shares (Note 5)
| | | | | | | 6,337,804 | | | | |
Transfer and dividend disbursing agent fees and expenses--Retirement Shares (Note 5)
| | | | | | | 11,518,485 | | | | |
Directors'/Trustees' fees
| | | | | | | 75,970 | | | | |
Auditing fees
| | | | | | | 16,896 | | | | |
Legal fees
| | | | | | | 11,940 | | | | |
Portfolio accounting fees
| | | | | | | 176,206 | | | | |
Shareholder services fee--Investment Shares (Note 5)
| | | | | | | 20,676,105 | | | | |
Shareholder services fee--Retirement Shares (Note 5)
| | | | | | | 5,443,622 | | | | |
Share registration costs
| | | | | | | 974,610 | | | | |
Printing and postage
| | | | | | | 888,801 | | | | |
Insurance premiums
| | | | | | | 80,044 | | | | |
Miscellaneous
|
|
|
|
|
|
| 30,622
|
|
|
|
|
TOTAL EXPENSES
|
|
|
|
|
|
| 97,910,887
|
|
|
|
|
Waivers (Note 5):
| | | | | | | | | | | |
Waiver of administrative personnel and services fee
| | $ | (386,426 | ) | | | | | | | |
Waiver of transfer and dividend disbursing agent fees and expenses--Retirement Shares
|
|
| (445,309
| )
|
|
|
|
|
|
|
|
TOTAL WAIVERS
|
|
|
|
|
|
| (831,735
| )
|
|
|
|
Net expenses
|
|
|
|
|
|
|
|
|
|
| 97,079,152
|
Net investment income
|
|
|
|
|
|
|
|
|
| $
| 280,130,746
|
See Notes which are an integral part of the Financial Statements
Statement of Changes in Net Assets
Year Ended February 28
|
|
| 2006
|
|
|
| 2005
|
|
Increase (Decrease) in Net Assets
| | | | | | | | |
Operations:
| | | | | | | | |
Net investment income
|
| $
| 280,130,746
|
|
| $
| 68,142,152
|
|
Distributions to Shareholders:
| | | | | | | | |
Distributions from net investment income
| | | | | | | | |
Investment Shares
| | | (230,685,462 | ) | | | (59,431,979 | ) |
Retirement Shares
|
|
| (49,498,538
| )
|
|
| (8,725,955
| )
|
CHANGE IN NET ASSETS RESULTING FROM DISTRIBUTIONS TO SHAREHOLDERS
|
|
| (280,184,000
| )
|
|
| (68,157,934
| )
|
Share Transactions:
| | | | | | | | |
Proceeds from sale of shares
| | | 61,544,483,269 | | | | 49,340,467,605 | |
Net asset value of shares issued to shareholders in payment of distributions declared
| | | 269,496,370 | | | | 64,791,631 | |
Cost of shares redeemed
|
|
| (59,774,561,972
| )
|
|
| (49,844,306,916
| )
|
CHANGE IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS
|
|
| 2,039,417,667
|
|
|
| (439,047,680
| )
|
Change in net assets
|
|
| 2,039,364,413
|
|
|
| (439,063,462
| )
|
Net Assets:
| | | | | | | | |
Beginning of period
|
|
| 9,949,403,133
|
|
|
| 10,388,466,595
|
|
End of period (including distributions in excess of net investment income of $(74,215) and $(20,961), respectively)
|
| $
| 11,988,767,546
|
|
| $
| 9,949,403,133
|
|
See Notes which are an integral part of the Financial Statements
Notes to Financial Statements
February 28, 2006
1. ORGANIZATION
Edward Jones Money Market Fund (the "Fund") is registered under the Investment Company Act of 1940, as amended (the "Act"), as a diversified, open-end management investment company. The investment objective of the Fund is stability of principal and current income consistent with stability of principal.
The Fund offers two classes of shares: Investment Shares and Retirement Shares. All shares of the Fund have equal rights with respect to voting except on class specific matters.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently followed by the Fund in the preparation of its financial statements. These policies are in conformity with generally accepted accounting principles (GAAP) in the United States of America.
Investment Valuation
The Fund uses the amortized cost method to value its portfolio securities in accordance with Rule 2a-7 under the Act.
Repurchase Agreements
It is the policy of the Fund to require the other party to a repurchase agreement to transfer to the Fund's custodian or sub-custodian eligible securities or cash with a market value (after transaction costs) at least equal to the repurchase price to be paid under the repurchase agreement. The eligible securities are transferred to accounts with the custodian or sub-custodian in which the Fund holds a "securities entitlement" and exercises "control" as those terms are defined in the Uniform Commercial Code. The Fund has established procedures for monitoring the market value of the transferred securities and requiring the transfer of additional eligible securities if necessary to equal at least the repurchase price. These procedures also allow the other party to require securities to be transferred from the account to the extent that their market value exceeds the repurchase price or in exchange for other eligible securities of equivalent market value.
With respect to agreements to repurchase U.S. government securities and cash items, the Fund treats the repurchase agreement as an investment in the underlying securities and not as an obligation of the other party to the repurchase agreement. Other repurchase agreements are treated as obligations of the other party secured by the underlying securities. Nevertheless, the insolvency of the other party or other failure to repurchase the securities may delay the disposition of the underlying securities or cause the Fund to receive less than the full repurchase price. Under the terms of the repurchase agreement, any amounts received by the Fund in excess of the repurchase price and related transaction costs must be remitted to the other party.
The Fund may enter into repurchase agreements in which eligible securities are transferred into joint trading accounts maintained by the custodian or sub custodian for investment companies and other clients advised by the Adviser and its affiliates. The Fund will participate on a pro rata basis with the other investment companies and clients in its share of the securities transferred under such repurchase agreements and in its share of proceeds from any repurchase or other disposition of such securities.
Investment Income, Gains and Losses, Expenses, and Distributions
Interest income and expenses are accrued daily. Distributions of net investment income are declared daily, paid monthly, and recorded on the ex-dividend date. Investment income, realized gains and losses, and certain fund-level expenses are allocated to each class based on relative average daily net assets, except that each class bears certain expenses unique to that class, such as transfer and dividend disbursing agent and shareholder services fees. Dividends are declared separately for each class. No class has preferential dividend rights; differences in per share dividend rates are generally due to differences in separate class expenses.
Premium and Discount Amortization
All premiums and discounts are amortized/accreted.
Federal Taxes
It is the Fund's policy to comply with the Subchapter M provision of the Internal Revenue Code (the "Code") and to distribute to shareholders each year substantially all of its income. Accordingly, no provision for federal income tax is necessary.
When-Issued and Delayed Delivery Transactions
The Fund may engage in when-issued or delayed delivery transactions. The Fund records when-issued securities on the trade date and maintains security positions such that sufficient liquid assets will be available to make payment for the securities purchased. Securities purchased on a when-issued or delayed delivery basis are marked to market daily and begin earning interest on the settlement date. Losses may occur on these transactions due to changes in market conditions or the failure of counterparties to perform under the contract.
Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts of assets, liabilities, expenses and revenues reported in the financial statements. Actual results could differ from those estimated.
Other
Investment transactions are accounted for on a trade date basis.
3. SHARES OF BENEFICIAL INTEREST
The following table summarizes share activity:
Year Ended February 28
|
| 2006
|
| 2005
|
Investment Shares:
|
| Shares
|
|
|
| Amount
|
|
| Shares
|
|
|
| Amount
|
|
Shares sold
| | 34,456,824,162 | | | $ | 34,456,824,162 | | | 26,880,270,814 | | | $ | 26,880,270,814 | |
Shares issued to shareholders in payment of distributions declared
|
| 223,141,912 |
|
| | 223,141,912 |
|
| 56,837,522 |
|
| | 56,837,522 |
|
Shares redeemed
|
| (32,789,826,353
| )
|
|
| (32,789,826,353
| )
|
| (27,301,349,823
| )
|
|
| (27,301,349,823
| )
|
NET CHANGE RESULTING FROM INVESTMENT SHARE TRANSACTIONS
|
| 1,890,139,721
|
|
|
$
| 1,890,139,721
|
|
| (364,241,487
| )
|
|
$
| (364,241,487
| )
|
| | | | | | | | | | | | | | |
|
| 2006
|
| 2005
|
Retirement Shares:
|
| Shares
|
|
|
| Amount
|
|
| Shares
|
|
|
| Amount
|
|
Shares sold
| | 27,087,659,059 | | | $ | 27,087,659,059 | | | 22,460,196,791 | | | $ | 22,460,196,791 | |
Shares issued to shareholders in payment of distributions declared
|
| 46,354,458 |
|
|
| 46,354,458 |
|
| 7,954,109 | |
|
| 7,954,109 |
|
Shares redeemed
|
| (26,984,735,619
| )
|
|
| (26,984,735,619
| )
|
| (22,542,957,093
| )
|
|
| (22,542,957,093
| )
|
NET CHANGE RESULTING FROM RETIREMENT SHARE TRANSACTIONS
|
| 149,277,898
|
|
|
$
| 149,277,898
|
|
| (74,806,193
| )
|
|
$
| (74,806,193
| )
|
NET CHANGE RESULTING FROM SHARE TRANSACTIONS
|
| 2,039,417,619
|
|
|
$
| 2,039,417,619
|
|
| (439,047,680
| )
|
|
$
| (439,047,680
| )
|
4. FEDERAL TAX INFORMATION
The tax character of distributions as reported on the Statement of Changes in Net Assets for the years ended February 28, 2006 and 2005 was as follows:
|
| 2006
|
| 2005
|
Ordinary income 1
|
| $280,184,000
|
| $68,157,934
|
1 For tax purposes short-term capital gain distributions are considered ordinary income distributions.
As of February 28, 2006, the components of distributable earnings on a tax basis were as follows:
Undistributed ordinary income
|
| $
| 8,029,490
|
|
Income distributions payable
|
| $
| (8,103,706
| )
|
5. INVESTMENT ADVISER FEE AND OTHER TRANSACTIONS WITH AFFILIATES
Investment Adviser Fee
Passport Research, Ltd., the Fund's investment adviser (the "Adviser") receives for its services an annual investment adviser fee based on average daily net assets of the Fund as follows: 0.500% on the first $500 million; 0.475% on the second $500 million; 0.450% on the third $500 million; 0.425% on the fourth $500 million; and 0.400% on amounts more than $2 billion. The Adviser may voluntarily choose to waive any portion of its fee. The Adviser can modify or terminate this voluntary waiver at any time at its sole discretion.
Adviser's Background
Passport Research, Ltd., is a Pennsylvania limited partnership organized in 1981. Federated Investment Management Company (FIMCO), is the general partner of the Adviser and has a 50.5% interest in the Adviser. FIMCO is owned by Federated Investors, Inc. Edward D. Jones & Co., L.P. d/b/a Edward Jones is the limited partner of the Adviser and has a 49.5% interest in the Adviser. For the fiscal year ended February 28, 2006, the general partner received approximately 28% of the Adviser's revenues, while Edward Jones received approximately 72%. This allocation may vary depending upon total assets in the Fund or other factors.
Administrative Fee
Federated Administrative Services (FAS), under the Administrative Services Agreement, provides the Fund with certain administrative personnel and services. The fee paid to FAS is based on the average aggregate daily net assets of certain Federated funds as specified below:
Maximum
Administrative Fee
|
| Average Aggregate Daily Net Assets
of the Federated Funds
|
0.150%
|
| on the first $5 billion
|
0.125%
|
| on the next $5 billion
|
0.100%
|
| on the next $10 billion
|
0.075%
|
| on assets in excess of $20 billion
|
The administrative fee received during any fiscal year shall be at least $150,000 per portfolio and $40,000 per each additional class of Shares. FAS may voluntarily choose to waive any portion of its fee. FAS can modify or terminate this voluntary waiver at any time at its sole discretion. For the year ended February 28, 2006, the net fee paid to FAS was 0.076% of average aggregate daily net assets of the Fund. FAS has delegated certain fund administration responsibilities to Edward Jones. As compensation for its services, FAS shares one-half of the administrative fee that FAS receives with Edward Jones.
Shareholder Services Fee
The Fund may pay fees (Services Fees) up to 0.25% of the average daily net assets of the Fund's Investment Shares and Retirement Shares to Edward Jones.
Transfer and Dividend Disbursing Agent Fees and Expenses
Edward Jones serves as transfer and dividend disbursing agent for the Fund. The fee paid to Edward Jones is based on the size, type and number of accounts and transactions made by shareholders. Edward Jones may voluntarily choose to waive any portion of its fee. Edward Jones can modify or terminate this voluntary waiver at any time at its sole discretion.
General
Certain of the Officers and Trustees of the Fund are Officers and Directors or Trustees of the above companies.
6. LEGAL PROCEEDINGS
Federated
Beginning in October 2003, Federated Investors, Inc. and various subsidiaries thereof (including the advisers and distributor for various investment companies, collectively, "Federated"), along with various investment companies sponsored by Federated ("Funds") were named as defendants in several class action lawsuits now pending in the United States District Court for the District of Maryland. The lawsuits were purportedly filed on behalf of people who purchased, owned and/or redeemed shares of Federated-sponsored mutual funds during specified periods beginning November 1, 1998. The suits are generally similar in alleging that Federated engaged in illegal and improper trading practices including market timing and late trading in concert with certain institutional traders, which allegedly caused financial injury to the mutual fund shareholders. These lawsuits began to be filed shortly after Federated's first public announcement that it had received requests for information on shareholder trading activities in the Funds from the Securities and Exchange Commission ("SEC"), the Office of the New York State Attorney General ("NYAG"), and other authorities. In that regard, on November 28, 2005, Federated announced that it had reached final settlements with the SEC and the NYAG with respect to those matters. As Federated previously reported in 2004, it has already paid approximately $8.0 million to certain funds as determined by an independent consultant. As part of these settlements, Federated agreed to pay for the benefit of fund shareholders additional disgorgement and a civil money penalty in the aggregate amount of an additional $72 million .. Federated and various Funds have also been named as defendants in several additional lawsuits, the majority of which are now pending in the United States District Court for the Western District of Pennsylvania, alleging, among other things, excessive advisory and Rule 12b-1 fees. The Board of the Funds has retained the law firm of Dickstein Shapiro Morin & Oshinsky LLP to represent the Funds in these lawsuits. Federated and the Funds, and their respective counsel, are reviewing the allegations and will respond appropriately. Additional lawsuits based upon similar allegations may be filed in the future. The potential impact of these lawsuits, all of which seek unquantified damages, attorneys' fees and expenses, and future potential similar suits is uncertain. Although we do not believe that these lawsuits will have a material adverse effect on the Funds, there can be no assurance that these suits, the ongoing adverse publicity and/or other developments resulting from the regulatory investigations will not result in increased Fund redemptions, reduced sales of Fund shares, or other adverse consequences for the Funds.
Edward Jones
In the normal course of business, Edward Jones is named, from time to time, as a defendant in various legal actions, including arbitrations, class actions, and other litigation. Certain of these legal actions include claims for substantial compensatory and/or punitive damages or claims for indeterminate amounts of damages. Edward Jones is involved, from time to time, in investigations and proceedings by governmental and self-regulatory agencies, certain of which may result in adverse judgments, fines, or penalties. Recently, the number of legal actions and investigations has increased with a focus on mutual fund issues among many firms in the financial services industry, including Edward Jones.
The potential impact of these legal proceedings is uncertain. As of the date of this report, Edward Jones does not believe that any current or anticipated legal proceedings will have a material adverse impact on Edward Jones or the Fund. However, there can be no assurance that these suits, the ongoing adverse publicity and/or other developments resulting from the regulatory investigations will not result in increased Fund redemptions, reduced sales of Fund shares, or other adverse consequences for the Fund.
Report of Independent Registered Public Accounting Firm
TO THE SHAREHOLDERS AND BOARD OF TRUSTEES OF EDWARD JONES MONEY MARKET FUND:
We have audited the accompanying statement of assets and liabilities of Edward Jones Money Market Fund (the "Fund"), including the portfolio of investments, as of February 28, 2006, and the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the periods indicated therein. These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. We were not engaged to perform an audit of the Fund's internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Fund's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements and financial highlights, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of February 28, 2006, by correspondence with the custodian and brokers. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Edward Jones Money Market Fund at February 28, 2006, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and its financial highlights for each of the periods indicated therein, in conformity with U.S. generally accepted accounting principles.
Ernst & Young LLP
Boston, Massachusetts
April 7, 2006
Board of Trustees and Fund Officers
The Board is responsible for managing the Fund's business affairs and for exercising all the Fund's powers except those reserved for the shareholders. The following tables give information about each Board member and the senior officers of the Fund. Where required, the tables separately list Board members who are "interested persons" of the Fund (i.e., "Interested" Board members) and those who are not (i.e., "Independent" Board members). Unless otherwise noted, the address of each person listed is Federated Investors Tower, 1001 Liberty Avenue, Pittsburgh, PA. As of December 31, 2005, the Fund comprised one portfolio, and the Federated Fund Complex consisted of 43 investment companies (comprising 136 portfolios). Unless otherwise noted, each Officer is elected annually. Unless otherwise noted, each Board member oversees all portfolios in the Federated Fund Complex and serves for an indefinite term. The Fund's Statement of Additional Information includes additional information about Fund Trustees and is available, without charge and upon request, by calling 1-800-341-7400.
INTERESTED TRUSTEE BACKGROUND
|
|
|
Name
Birth Date
Address
Positions Held with Fund
Date Service Began
|
| Principal Occupation(s) for Past Five Years,
Other Directorships Held and Previous Position(s)
|
John F. Donahue*
Birth Date: July 28, 1924
TRUSTEE
Began serving: January 1980 | | Principal Occupations : Director or Trustee of the Federated Fund Complex; Chairman and Director, Federated Investors, Inc.
Previous Positions : Chairman of the Federated Fund Complex; Trustee, Federated Investment Management Company and Chairman and Director, Federated Investment Counseling. |
|
|
|
J. Christopher Donahue*
Birth Date: April 11, 1949
PRESIDENT AND TRUSTEE
Began serving: November 1998 | | Principal Occupations : Principal Executive Officer and President of the Federated Fund Complex; Director or Trustee of some of the Funds in the Federated Fund Complex; President, Chief Executive Officer and Director, Federated Investors, Inc.; Chairman and Trustee, Federated Investment Management Company; Trustee, Federated Investment Counseling; Chairman and Director, Federated Global Investment Management Corp.; Chairman, Passport Research, Ltd. (Investment advisory subsidiary of Federated) and Passport Research II, Ltd. (Investment advisory subsidiary of Federated); Trustee, Federated Shareholder Services Company; Director, Federated Services Company.
Previous Positions : President, Federated Investment Counseling; President and Chief Executive Officer, Federated Investment Management Company, Federated Global Investment Management Corp. and Passport Research, Ltd. |
|
|
|
|
|
|
Name
Birth Date
Address
Positions Held with Fund
Date Service Began
|
| Principal Occupation(s) for Past Five Years,
Other Directorships Held and Previous Position(s)
|
Lawrence D. Ellis, M.D.*
Birth Date: October 11, 1932
3471 Fifth Avenue
Suite 1111
Pittsburgh, PA
TRUSTEE
Began serving: August 1987 | | Principal Occupations : Director or Trustee of the Federated Fund Complex; Professor of Medicine, University of Pittsburgh; Medical Director, University of Pittsburgh Medical Center Downtown; Hematologist, Oncologist and Internist, University of Pittsburgh Medical Center.
Other Directorships Held : Member, National Board of Trustees, Leukemia Society of America.
Previous Positions : Trustee, University of Pittsburgh; Director, University of Pittsburgh Medical Center. |
|
|
|
* Family relationships and reasons for "interested" status: John F. Donahue is the father of J. Christopher Donahue; both are "interested" due to the positions they hold with Federated Investors, Inc. and its subsidiaries. Lawrence D. Ellis, M.D. is "interested" because his son-in-law is employed by the Fund's principal underwriter, Federated Securities Corp.
INDEPENDENT TRUSTEES BACKGROUND
|
|
|
Name
Birth Date
Address
Positions Held with Fund
Date Service Began
|
| Principal Occupation(s) for Past Five Years,
Other Directorships Held and Previous Position(s)
|
Thomas G. Bigley
Birth Date: February 3, 1934
15 Old Timber Trail
Pittsburgh, PA
TRUSTEE
Began serving: October 1995 | | Principal Occupation : Director or Trustee of the Federated Fund Complex.
Other Directorships Held : Director, Member of Executive Committee, Children's Hospital of Pittsburgh; Director, University of Pittsburgh.
Previous Position : Senior Partner, Ernst & Young LLP. |
|
|
|
John T. Conroy, Jr.
Birth Date: June 23, 1937
Investment Properties Corporation
3838 North Tamiami Trail
Suite 402
Naples, FL
TRUSTEE
Began serving: August 1991 | | Principal Occupations : Director or Trustee of the Federated Fund Complex; Chairman of the Board, Investment Properties Corporation; Partner or Trustee in private real estate ventures in Southwest Florida.
Previous Positions : President, Investment Properties Corporation; Senior Vice President, John R. Wood and Associates, Inc., Realtors; President, Naples Property Management, Inc. and Northgate Village Development Corporation. |
|
|
|
Nicholas P. Constantakis
Birth Date: September 3, 1939
175 Woodshire Drive
Pittsburgh, PA
TRUSTEE
Began serving: November 1998 | | Principal Occupation : Director or Trustee of the Federated Fund Complex.
Other Directorships Held : Director and Member of the Audit Committee, Michael Baker Corporation (engineering and energy services worldwide).
Previous Position : Partner, Andersen Worldwide SC. |
|
|
|
|
|
|
Name
Birth Date
Address
Positions Held with Fund
Date Service Began
|
| Principal Occupation(s) for Past Five Years,
Other Directorships Held and Previous Position(s)
|
John F. Cunningham
Birth Date: March 5, 1943
353 El Brillo Way
Palm Beach, FL
TRUSTEE
Began serving: November 1998 | | Principal Occupation : Director or Trustee of the Federated Fund Complex.
Other Directorships Held : Chairman, President and Chief Executive Officer, Cunningham & Co., Inc. (strategic business consulting); Trustee Associate, Boston College.
Previous Positions : Director, Redgate Communications and EMC Corporation (computer storage systems); Chairman of the Board and Chief Executive Officer, Computer Consoles, Inc.; President and Chief Operating Officer, Wang Laboratories; Director, First National Bank of Boston; Director, Apollo Computer, Inc. |
|
|
|
Peter E. Madden
Birth Date: March 16, 1942
One Royal Palm Way
100 Royal Palm Way
Palm Beach, FL
TRUSTEE
Began serving: August 1991 | | Principal Occupation : Director or Trustee of the Federated Fund Complex.
Other Directorships Held : Board of Overseers, Babson College.
Previous Positions : Representative, Commonwealth of Massachusetts General Court; President, State Street Bank and Trust Company and State Street Corporation (retired); Director, VISA USA and VISA International; Chairman and Director, Massachusetts Bankers Association; Director, Depository Trust Corporation; Director, The Boston Stock Exchange. |
|
|
|
Charles F. Mansfield, Jr.
Birth Date: April 10, 1945
80 South Road
Westhampton Beach, NY
TRUSTEE
Began serving: November 1998 | | Principal Occupations : Director or Trustee of the Federated Fund Complex; Management Consultant.
Previous Positions : Chief Executive Officer, PBTC International Bank; Partner, Arthur Young & Company (now Ernst & Young LLP); Chief Financial Officer of Retail Banking Sector, Chase Manhattan Bank; Senior Vice President, HSBC Bank USA (formerly, Marine Midland Bank); Vice President, Citibank; Assistant Professor of Banking and Finance, Frank G. Zarb School of Business, Hofstra University ; Executive Vice President, DVC Group, Inc. |
|
|
|
John E. Murray, Jr., J.D., S.J.D.
Birth Date: December 20, 1932
Chancellor, Duquesne University
Pittsburgh, PA
TRUSTEE
Began serving: February 1995 | | Principal Occupations : Director or Trustee, and Chairman of the Board of Directors or Trustees, of the Federated Fund Complex; Chancellor and Law Professor, Duquesne University; Partner, Murray, Hogue & Lannis.
Other Directorships Held : Director, Michael Baker Corp. (engineering, construction, operations and technical services).
Previous Positions : President, Duquesne University; Dean and Professor of Law, University of Pittsburgh School of Law; Dean and Professor of Law, Villanova University School of Law. |
|
|
|
|
|
|
Name
Birth Date
Address
Positions Held with Fund
Date Service Began
|
| Principal Occupation(s) for Past Five Years,
Other Directorships Held and Previous Position(s)
|
Marjorie P. Smuts
Birth Date: June 21, 1935
4905 Bayard Street
Pittsburgh, PA
TRUSTEE
Began serving: February 1984 | | Principal Occupations : Director or Trustee of the Federated Fund Complex; Public Relations/Marketing Consultant/Conference Coordinator.
Previous Positions : National Spokesperson, Aluminum Company of America; television producer; President, Marj Palmer Assoc.; Owner, Scandia Bord. |
|
|
|
John S. Walsh
Birth Date: November 28, 1957
2604 William Drive
Valparaiso, IN
TRUSTEE
Began serving: November 1998 | | Principal Occupations : Director or Trustee of the Federated Fund Complex; President and Director, Heat Wagon, Inc. (manufacturer of construction temporary heaters); President and Director, Manufacturers Products, Inc. (distributor of portable construction heaters); President, Portable Heater Parts, a division of Manufacturers Products, Inc.
Previous Position : Vice President, Walsh & Kelly, Inc. |
|
|
|
James F. Will
Birth Date: October 12, 1938
Saint Vincent College
Latrobe, PA
TRUSTEE
Began serving: April 2006 | | Principal Occupations : Vice Chancellor and President, Saint Vincent College.
Other Directorships Held : Alleghany Corporation.
Previous Positions : Chairman, President and Chief Executive Officer, Armco, Inc.; President and Chief Executive Officer, Cyclops Industries; President and Chief Operating Officer, Kaiser Steel Corporation. |
|
|
|
OFFICERS
|
|
|
Name
Birth Date
Positions Held with Trust
Date Service Began
|
| Principal Occupation(s) for Past Five Years and Previous Position(s)
|
John W. McGonigle
Birth Date: October 26, 1938
EXECUTIVE VICE PRESIDENT
AND SECRETARY
Began serving: January 1980 | | Principal Occupations : Executive Vice President and Secretary of the Federated Fund Complex; Vice Chairman, Executive Vice President, Secretary and Director, Federated Investors, Inc.
Previous Positions : Trustee, Federated Investment Management Company and Federated Investment Counseling; Director, Federated Global Investment Management Corp., Federated Services Company and Federated Securities Corp. |
|
|
|
Richard A. Novak
Birth Date: December 25, 1963
TREASURER
Began serving: January 2006 | | Principal Occupations:. Principal Financial Officer and Treasurer of the Federated Fund Complex; Senior Vice President, Federated Administrative Services; Financial and Operations Principal for Federated Securities Corp., Edgewood Services, Inc. and Southpointe Distribution Services, Inc.; Senior Vice President and Controller of Federated Investors, Inc ..
Previous Positions: Vice President, Finance of Federated Services Company; held various financial management positions within The Mercy Hospital of Pittsburgh; Auditor, Arthur Andersen & Co. |
|
|
|
Richard B. Fisher
Birth Date: May 17, 1923
VICE CHAIRMAN
Began serving: August 2002 | | Principal Occupations : Vice Chairman or Vice President of some of the Funds in the Federated Fund Complex; Vice Chairman, Federated Investors, Inc.; Chairman, Federated Securities Corp.
Previous Positions : President and Director or Trustee of some of the Funds in the Federated Fund Complex; Executive Vice President, Federated Investors, Inc. and Director and Chief Executive Officer, Federated Securities Corp. |
|
|
|
Deborah A. Cunningham
Birth Date: September 15, 1959
CHIEF INVESTMENT OFFICER
Began serving: May 2004 | | Principal Occupations: Deborah A. Cunningham has been the Fund's Portfolio Manager since 1994. Ms. Cunningham was named Chief Investment Officer of money market products in 2004 and is a Vice President of the Fund. She joined Federated in 1981 and has been a Senior Portfolio Manager and a Senior Vice President of the Fund's Adviser since 1997. Ms. Cunningham is a Chartered Financial Analyst and received her M.S.B.A. in Finance from Robert Morris College. |
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Susan R. Hill
Birth Date: June 20, 1963
VICE PRESIDENT
Began serving: November 1998 | | Susan R. Hill has been the Fund's Portfolio Manager since 1994. She is Vice President of the Fund. Ms. Hill joined Federated in 1990 and has been a Senior Portfolio Manager since 2003 and a Senior Vice President of the Fund's Adviser since 2005. Ms. Hill was a Portfolio Manager from 1994 until 2003, and served as Vice President of the Fund's Adviser from 1997 until 2004 and an Assistant Vice President of the Fund's Adviser from 1994 until 1997. Ms. Hill is a Chartered Financial Analyst and received an M.S. in Industrial Administration from Carnegie Mellon University. |
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Board Review of Advisory Contract
As required by the Act, the Fund's Board has reviewed the Fund's investment advisory contract. The Board's decision to approve the contract reflects the exercise of its business judgment on whether to continue the existing arrangements. During its review of the contract, the Board considers many factors, among the most material of which are: the Fund's investment objectives; the Adviser's management philosophy, personnel, processes, and investment and operating strategies; long term performance; the preferences and expectations of Fund shareholders and their relative sophistication; the continuing state of competition in the mutual fund industry; the range of comparable fees for similar funds in the mutual fund industry; the range and quality of services provided to the Fund and its shareholders by the Federated organization in addition to investment advisory services; and the Fund's relationship to the Federated family of funds which include a comprehensive array of funds with different investment objectives, policies and strategies which are available for exchange without the incurrence of additional sales charge.
In its decision to appoint or renew the Adviser, the Board is mindful of the potential disruptions of the Fund's operations and various risks, uncertainties and other effects that could occur as a result of a decision to terminate or not renew an advisory contract. In particular, the Board recognizes that most shareholders have invested in the Fund on the strength of the Adviser's industry standing and reputation and in the expectation that the Adviser will have a continuing role in providing advisory services to the Fund. Thus, the Board's "selection" or approval of the Adviser must reflect the fact that it is the shareholders who have effectively selected the Adviser by virtue of having invested in the Fund. The Board also considers the compensation and benefits received by the Adviser. This includes fees received for services provided to the Fund by other entities in the Federated organization and research services received by the Adviser from brokers that execute fund trades, as well as advisory fees. In this regard, the Board is aware that various courts have interpreted provisions of the Act and have indicated in their decisions that the following factors may be relevant to an Adviser's fiduciary duty with respect to its receipt of compensation from a fund: the nature and quality of the services provided by the Adviser, including the performance of the Fund; the Adviser's cost of providing the services; the extent to which the Adviser may realize "economies of scale" as the Fund grows larger; any indirect benefits that may accrue to the Adviser and its affiliates as a result of the Adviser's relationship with the Fund; performance and expenses of comparable funds; and the extent to which the independent Board members are fully informed about all facts bearing on the Adviser's service and fee. The Fund's Board is aware of these factors and is guided by them in its review of the Fund's advisory contract to the extent they are appropriate and relevant, as discussed further below.
The Board considers and weighs these circumstances in light of its substantial accumulated experience in governing the Fund and working with Federated on matters relating to the Federated funds, and is assisted in its deliberations by the advice of independent legal counsel. In this regard, the Board requests and receives substantial and detailed information about the Fund and the Federated organization. Federated provides much of this information at each regular meeting of the Board, and furnishes additional reports in connection with the particular meeting at which the Board's formal review of the advisory contract occurs. In between regularly scheduled meetings, the Board may receive information on particular matters as the need arises. Thus, the Board's evaluation of an advisory contract is informed by reports covering such matters as: the Adviser's investment philosophy, personnel, and processes; operating strategies; the Fund's short- and long-term performance (in absolute terms, both on a gross basis and net of expenses, as well as in relationship to its particular investment program and certain competitor or "peer group" funds and/or other benchmarks, as appropriate), and comments on the reasons for performance; the Fund's expenses (including the advisory fee itself and the overall expense structure of the Fund, both in absolute terms and relative to similar and/or competing funds, with due regard for contractual or voluntary expense limitations); the use and allocation of brokerage commissions derived from trading the Fund's portfolio securities (if any); the nature and extent of the advisory and other services provided to the Fund by the Adviser and its affiliates; compliance and audit reports concerning the Federated funds and the Federated companies that service them (including communications from regulatory agencies), as well as Federated's responses to any issues raised therein; and relevant developments in the mutual fund industry and how the Federated funds and/or Federated are responding to them. The evaluation process is evolutionary, reflecting continually developing considerations. The criteria considered and the emphasis placed on relevant criteria change in recognition of changing circumstances in the mutual fund marketplace. For the past year, the Board concluded that the nature, quality and scope of services provided the fund by the Adviser and its affiliates was satisfactory.
With respect to the Fund's performance and expenses in particular, the Board has found the use of comparisons to other mutual funds with comparable investment programs to be particularly useful, given the high degree of competition in the mutual fund business. The Board focuses on comparisons with other similar mutual funds (rather than non-mutual fund products or services) because, simply put, they are more relevant. For example, other mutual funds are the products most like the Fund, they are readily available to Fund shareholders as alternative investment vehicles, and they are the type of investment vehicle in fact chosen and maintained by the Fund's investors. The range of their fees and expenses therefore appears to be a generally reliable indication of what consumers have found to be reasonable in the precise marketplace in which the Fund competes. The Fund's ability to deliver competitive performance when compared to its peer group may be a useful indicator of how the Adviser is executing on the Fund's investment program, which would in turn assist the Board in reaching a conclusion that the nature, extent, and quality of the Adviser's investment management services are such as to warrant continuation of the advisory contract. The Fund's performance fell below the median of the relevant peer group during the year ending December 31, 2004. The Board discussed the Fund's performance with the Adviser and recognized the efforts being undertaken by the Adviser. The Board will continue to monitor these efforts and the performance of the Fund. During the year ending December 31, 2004, the Fund's investment advisory fee after waivers and expense reimbursements, if any, was above the median of the relevant peer group. The Board reviewed the fees and other expenses of the Fund with the Adviser and was satisfied that the overall expense structure of the Fund remained competitive. The Board will continue to monitor advisory fees and other expenses borne by the Fund.
The Board also receives financial information about Federated, including reports on the compensation and benefits Federated derives from its relationships with the Federated funds. These reports cover not only the fees under the advisory contracts, but also fees received by Federated's subsidiaries for providing other services to the Federated funds under separate contracts (e.g., for serving as the Federated funds' administrator). The reports also discuss any indirect benefit Federated may derive from its receipt of research services from brokers who execute Federated fund trades as well as waivers of fees and/or reimbursements of expenses. In order for a fund to be competitive in the marketplace, Federated and its affiliates frequently waive fees and/or reimburse expenses. Although the Board considers the costs incurred and the profitability of the Federated organization as a whole, it does not evaluate, on a fund-by-fund basis, Federated's "profitability" and/or "costs" (which would include an assessment as to whether "economies of scale" would be realized if the fund were to grow to some sufficient size). In the Board's view, the cost of performing advisory services on a fund-specific basis is both difficult to estimate satisfactorily and a relatively minor consideration in its overall evaluation. Analyzing isolated funds would require constructed allocations of the costs of shared resources and operations based on artificial assumptions that are inconsistent with the existing relationships within a large and diversified family of funds that receive advisory and other services from the same organization. In addition, the availability of the exchange privilege among funds in the Federated family makes consideration of the overall cost and profitability of Federated more relevant than that of individual funds. Based upon this review, the Board is satisfied that the costs incurred in, as well as the profitability realized from, managing the Fund and the other Federated Funds are appropriate. Although the Board is always interested in discovering any genuine "economies of scale," its experience has been that such "economies" are likely to arise only when a fund grows dramatically, and becomes and remains very large in size. Even in these instances, purchase and redemption activity, as well as the presence of expense limitations (if any), may offset any perceived economies. As suggested above, the Board considers the information it receives about the Fund's performance and expenses as compared to an appropriate set of similar competing funds to be more relevant.
The Board bases its decision to approve an advisory contract on the totality of the circumstances and relevant factors and with a view to past and future long-term considerations. Not all of the factors and considerations identified above are relevant to every Federated fund, nor does the Board consider any one of them to be determinative. With respect to the factors that are relevant, the Board's decision to approve the contract reflects its determination that Federated's performance and actions provide a satisfactory basis to support the decision to continue the existing arrangements.
Voting Proxies on Fund Portfolio Securities
A description of the policies and procedures that the Fund uses to determine how to vote proxies, if any, relating to securities held in the Fund's portfolio is available, without charge and upon request, by calling 1-800-341-7400. A report on "Form N-PX" of how the Fund voted any such proxies during the most recent 12-month period ended June 30 is available from the EDGAR database on the SEC's website at www.sec.gov.
Quarterly Portfolio Schedule
The Fund files with the SEC a complete schedule of its portfolio holdings, as of the close of the first and third quarters of its fiscal year, on "Form N-Q." These filings are available on the SEC's website at www.sec.gov and may be reviewed and copied at the SEC's Public Reference Room in Washington, DC. (Call 1-800-SEC-0330 for information on the operation of the Public Reference Room.)
Mutual funds are not bank deposits or obligations, are not guaranteed by any bank, and are not insured or guaranteed by the U.S. government, the Federal Deposit Insurance Corporation, the Federal Reserve Board, or any other government agency. Investment in mutual funds involves investment risk, including the possible loss of principal. Although money market funds seek to maintain a stable net asset value of $1.00 per share, there is no assurance that they will be able to do so.
This report is authorized for distribution to prospective investors only when preceded or accompanied by the fund's prospectus, which contains facts concerning its objective and policies, management fees, expenses, and other information.
Edward Jones
201 Progress Parkway
Maryland Heights, Missouri 63043
1-800-331-2451
Cusip 48019P102
Cusip 48019P201
30310 (4/06)
EdwardJones
Item 2. Code of Ethics
(a) As of the end of the period covered by this report, the registrant has
adopted a code of ethics (the "Section 406 Standards for Investment Companies
- - Ethical Standards for Principal Executive and Financial Officers") that
applies to the registrant's Principal Executive Officer and Principal
Financial Officer; the registrant's Principal Financial Officer also serves
as the Principal Accounting Officer.
(c) Not Applicable
(d) Not Applicable
(e) Not Applicable
(f)(3) The registrant hereby undertakes to provide any person, without
charge, upon request, a copy of the code of ethics. To request a copy of the
code of ethics, contact the registrant at 1-800-341-7400, and ask for a copy
of the Section 406 Standards for Investment Companies - Ethical Standards for
Principal Executive and Financial Officers.
Item 3. Audit Committee Financial Expert
The registrant's Board has determined that each member of the Board's Audit
Committee is an "audit committee financial expert," and that each such member
is "independent," for purposes of this Item. The Audit Committee consists of
the following Board members: Thomas G. Bigley, John T. Conroy, Jr., Nicholas
P. Constantakis and Charles F. Mansfield, Jr.
Item 4. Principal Accountant Fees and Services
(a) Audit Fees billed to the registrant for the two most recent
fiscal years:
Fiscal year ended 2006 - $17,383
Fiscal year ended 2005 - $13,484
(b) Audit-Related Fees billed to the registrant for the two most
recent fiscal years:
Fiscal year ended 2006 - $81
Fiscal year ended 2005 - $0
Transfer agent testing.
Amount requiring approval of the registrant's audit committee pursuant
to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X, $110,441 and
$16,500 respectively. Sarbanes Oxley sec. 302 procedures.
(c) Tax Fees billed to the registrant for the two most recent fiscal
years:
Fiscal year ended 2006 - $0
Fiscal year ended 2005 - $0
Amount requiring approval of the registrant's audit committee pursuant
to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X, $0 and $0
respectively.
(d) All Other Fees billed to the registrant for the two most recent
fiscal years:
Fiscal year ended 2006 - $0
Fiscal year ended 2005 - $0
Amount requiring approval of the registrant's audit committee pursuant
to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X, $0 and $0
respectively.
(e)(1) Audit Committee Policies regarding Pre-approval of Services.
The Audit Committee is required to pre-approve audit and
non-audit services performed by the independent auditor in order to assure
that the provision of such services do not impair the auditor's
independence. Unless a type of service to be provided by the independent
auditor has received general pre-approval, it will require specific
pre-approval by the Audit Committee. Any proposed services exceeding
pre-approved cost levels will require specific pre-approval by the Audit
Committee.
Certain services have the general pre-approval of the Audit
Committee. The term of the general pre-approval is 12 months from the date
of pre-approval, unless the Audit Committee specifically provides for a
different period. The Audit Committee will annually review the services that
may be provided by the independent auditor without obtaining specific
pre-approval from the Audit Committee and may grant general pre-approval for
such services. The Audit Committee will revise the list of general
pre-approved services from time to time, based on subsequent determinations.
The Audit Committee will not delegate its responsibilities to pre-approve
services performed by the independent auditor to management.
The Audit Committee has delegated pre-approval authority to its
Chairman. The Chairman will report any pre-approval decisions to the Audit
Committee at its next scheduled meeting. The Committee will designate
another member with such pre-approval authority when the Chairman is
unavailable.
AUDIT SERVICES
The annual Audit services engagement terms and fees will be subject to
the specific pre-approval of the Audit Committee. The Audit Committee must
approve any changes in terms, conditions and fees resulting from changes in
audit scope, registered investment company (RIC) structure or other matters.
In addition to the annual Audit services engagement specifically
approved by the Audit Committee, the Audit Committee may grant general
pre-approval for other Audit Services, which are those services that only the
independent auditor reasonably can provide. The Audit Committee has
pre-approved certain Audit services, all other Audit services must be
specifically pre-approved by the Audit Committee.
AUDIT-RELATED SERVICES
Audit-related services are assurance and related services that are
reasonably related to the performance of the audit or review of the Company's
financial statements or that are traditionally performed by the independent
auditor. The Audit Committee believes that the provision of Audit-related
services does not impair the independence of the auditor, and has
pre-approved certain Audit-related services, all other Audit-related services
must be specifically pre-approved by the Audit Committee.
TAX SERVICES
The Audit Committee believes that the independent auditor can provide
Tax services to the Company such as tax compliance, tax planning and tax
advice without impairing the auditor's independence. However, the Audit
Committee will not permit the retention of the independent auditor in
connection with a transaction initially recommended by the independent
auditor, the purpose of which may be tax avoidance and the tax treatment of
which may not be supported in the Internal Revenue Code and related
regulations. The Audit Committee has pre-approved certain Tax services, all
Tax services involving large and complex transactions must be specifically
pre-approved by the Audit Committee.
ALL OTHER SERVICES
With respect to the provision of services other than audit, review or
attest services the pre-approval requirement is waived if:
(1) The aggregate amount of all such services provided constitutes no more
than five percent of the total amount of revenues paid by
the registrant, the registrant's adviser (not including any
sub-adviser whose role is primarily portfolio management
and is subcontracted with or overseen by another investment
adviser), and any entity controlling, controlled by, or
under common control with the investment adviser that
provides ongoing services to the registrant to its
accountant during the fiscal year in which the services are
provided;
(2) Such services were not recognized by the registrant, the registrant's
adviser (not including any sub-adviser whose role is
primarily portfolio management and is subcontracted with or
overseen by another investment adviser), and any entity
controlling, controlled by, or under common control with
the investment adviser that provides ongoing services to
the registrant at the time of the engagement to be
non-audit services; and
(3) Such services are promptly brought to the attention of the Audit
Committee of the issuer and approved prior to the
completion of the audit by the Audit Committee or by one or
more members of the Audit Committee who are members of the
board of directors to whom authority to grant such
approvals has been delegated by the Audit Committee.
The Audit Committee may grant general pre-approval to those permissible
non-audit services classified as All Other services that it believes are
routine and recurring services, and would not impair the independence of the
auditor.
The SEC's rules and relevant guidance should be consulted to determine
the precise definitions of prohibited non-audit services and the
applicability of exceptions to certain of the prohibitions.
PRE-APPROVAL FEE LEVELS
Pre-approval fee levels for all services to be provided by the
independent auditor will be established annually by the Audit Committee. Any
proposed services exceeding these levels will require specific pre-approval
by the Audit Committee.
PROCEDURES
Requests or applications to provide services that require specific
approval by the Audit Committee will be submitted to the Audit Committee by
both the independent auditor and the Principal Accounting Officer and/or
Internal Auditor, and must include a joint statement as to whether, in their
view, the request or application is consistent with the SEC's rules on
auditor independence.
(e)(2) Percentage of services identified in items 4(b) through 4(d) that
were approved by the registrants audit committee pursuant to paragraph
(c)(7)(i)(C) of Rule 2-01 of Regulation S-X:
4(b)
Fiscal year ended 2006 - 0%
Fiscal year ended 2005 - 0%
Percentage of services provided to the registrants investment
adviser and any entity controlling, controlled by, or under
common control with the investment adviser that provides ongoing
services to the registrant that were approved by the registrants
audit committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01
of Regulation S-X, 0% and 0% respectively.
4(c)
Fiscal year ended 2006 - 0%
Fiscal year ended 2005 - 0%
Percentage of services provided to the registrants investment
adviser and any entity controlling, controlled by, or under
common control with the investment adviser that provides ongoing
services to the registrant that were approved by the registrants
audit committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01
of Regulation S-X, 0% and 0% respectively.
4(d)
Fiscal year ended 2006 - 0%
Fiscal year ended 2005 - 0%
Percentage of services provided to the registrants investment
adviser and any entity controlling, controlled by, or under
common control with the investment adviser that provides ongoing
services to the registrant that were approved by the registrants
audit committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01
of Regulation S-X, 0% and 0% respectively.
(f) NA
(g) Non-Audit Fees billed to the registrant, the registrant's investment
adviser, and certain entities controlling, controlled by or under
common control with the investment adviser:
Fiscal year ended 2006 - $154,657
Fiscal year ended 2005 - $161,819
(h) The registrant's Audit Committee has considered that the
provision of non-audit services that were rendered to the registrant's
adviser (not including any sub-adviser whose role is primarily portfolio
management and is subcontracted with or overseen by another investment
adviser), and any entity controlling, controlled by, or under common control
with the investment adviser that provides ongoing services to the registrant
that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of
Regulation S-X is compatible with maintaining the principal accountant's
independence.
Item 5. Audit Committee of Listed Registrants
Not Applicable
Item 6. Schedule of Investments
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
Not Applicable
Item 11. Controls and Procedures
(a) The registrant's President and Treasurer have concluded that the
registrant's disclosure controls and procedures (as defined in rule 30a-3(c)
under the Act) are effective in design and operation and are sufficient to
form the basis of the certifications required by Rule 30a-(2) under the Act,
based on their evaluation of these disclosure controls and procedures within
90 days of the filing date of this report on Form N-CSR.
(b) There were no changes in the registrant's internal control over financial
reporting (as defined in rule 30a-3(d) under the Act) during the last fiscal
quarter that have materially affected, or are reasonably likely to materially
affect, the registrant's internal control over financial reporting.
Item 12. 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.
Registrant Edward Jones Money Market Fund
By /s/ Richard A. Novak
Richard A. Novak, Principal Financial Officer
(insert name and title)
Date April 24, 2006
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/ J. Christopher Donahue
J. Christopher Donahue, Principal Executive Officer
Date April 24, 2006
By /s/ Richard A. Novak
Richard A. Novak, Principal Financial Officer
Date April 24, 2006
