UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D. C. 20549 FORM N-CSR Investment Company Act file number 811-03196 CASH RESERVE FUND, INC. -------------------------------- (Exact Name of Registrant as Specified in Charter) One South Street, Baltimore, Maryland 21202 ---------------------------------------------- (Address of Principal Executive Offices) (Zip Code) Registrant's Telephone Number, including Area Code: (617) 295-2663 -------------- Salvatore Schiavone Two International Place Boston, Massachusetts 02110 --------------------------------------- (Name and Address of Agent for Service) Date of fiscal year end: 3/31 Date of reporting period: 3/31/04ITEM 1. REPORT TO STOCKHOLDERS
Deutsche Bank Alex. Brown
Cash Reserve Fund, Inc.
Prime Series
Treasury Series
Tax-Free Series
Annual Report to Shareholders
March 31, 2004
Table of Contents |
Portfolio Management Review <Click Here> Cash Reserve Fund, Inc. Schedule of Investments <Click Here> Statements of Assets and Liabilities <Click Here> Statements of Operations <Click Here> Statements of Changes in Net Assets <Click Here> Financial Highlights <Click Here> Notes to Financial Statements <Click Here> Report of Independent Registered Public Accounting Firm <Click Here> Tax Information <Click Here> Other Information <Click Here> Directors and Officers <Click Here> |
This report must be preceded or accompanied by a prospectus. To obtain a prospectus for any of our funds, talk to your financial representative or call Shareholder Services at (800) 730-1313. We advise you to consider the fund's objectives, risks, charges and expenses carefully before investing. The prospectus contains this and other important information about the fund. Please read the prospectus carefully before you invest.
An investment in this fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the fund. Please read this fund's prospectus for specific details regarding its risk profile.
Fund shares are not FDIC-insured and are not deposits or other obligations of, or guaranteed by, any bank. Fund shares involve investment risk, including possible loss of principal.
In the following interview, the portfolio management team discusses market environment and their approach to managing Cash Reserve Fund, Inc. (the "fund") during its most recent fiscal year ended March 31, 2004.
Q: Will you discuss the market environment for the fund during the most recent 12-month period?
A: Following the Federal Reserve Board's surprising decision to lower the federal funds rate by only 25 basis points - to 1% - back in June 2003, the US economy began to stabilize beginning in the fall. The money market yield curve steepened and - following a long period of declining short-term interest rate levels - we were finally able to extend the fund's maturity. The government reported approximately 8% GDP growth for the third quarter, which seemed to show that the economy was finally turning the corner. With this announcement, the focus for investors turned to whether a renewed economy would produce significant job growth. Unfortunately, there was no sign that new jobs were being created at a significant rate during the third quarter.
In the second half of 2003, the Fed met several times and held short-term rates steady at 1%, repeatedly stating its bias towards staving off deflation. GDP was reported at approximately 4% for the fourth quarter, productivity levels remained high, yet the level of job creation remained stubbornly low. During the fourth quarter, the increased level of volatility in the money market yield curve made for a difficult investing environment, as the one-year LIBOR rate traded in a wide range of 1.4% to 1.65%.1
1 LIBOR, or the London Interbank Offered Rate, is the most widely used benchmark or reference rate for short-term interest rates. LIBOR is the rate of interest at which banks borrow funds from other banks, in large volume, in the international market.In December, the Fed, satisfied by the evidence of a rebound in the economy, removed its anti-deflation bias and maintained its focus on the need for job creation. At the time, the market was "pricing in" a federal funds rate hike of 25 basis points in August 2004. Through the first quarter of 2004, with few signs of a pickup in job growth, the Fed held off on declaring a bias toward tightening credit. At its January 28th meeting, however, the Fed did remove language that had appeared in previous statements asserting that it would keep short-term rates at current levels "for a considerable period." The fact that this is a presidential election year adds some uncertainty for Fed-watchers, as the Fed likely wants to avoid having its decisions on short-term rates cast in a political light. By the end of the fund's annual period, the market's forecast for a possible short-term interest rate increase was pushed back to October 2004 and beyond.
Q: How did each series of the fund perform over the fund's most recent fiscal year?
A: We were able to produce competitive yields in the Prime, Treasury and Tax-Free Series for the period. Given the volatility of the money market yield curve, during the third and fourth quarter of 2003 we were able to pick up some additional yield for each series as short-term rates rose. But through the first quarter of 2004, with continuing disappointment over the lack of job creation, the yield curve flattened. More market participants seemed to accept that short-term interest rates would not be rising soon, the market rallied and yields retreated. As securities within each series matured, we invested at lower interest rate levels.
Q: What detracted from performance during the period?
A: In December, we kept additional cash on hand - - as we do each year - to meet any tax-related redemptions as well as investors' year-end liquidity needs. Because we kept a larger percentage of each series assets in overnight liquidity, this detracted somewhat from the series' yield and total return.
Q: In light of market conditions during the 12-month period, what has been the strategy for the Prime Series and the Treasury Series?
A: During the period, we pursued a "barbell" strategy. That is, we purchased longer-duration instruments with maturities of six to nine
7-Day Current Yield | (as of 3/31/04) |
Prime Shares2 iMoneyNet First Tier Retail Money Funds Average6 | 0.52%3 0.36% |
Treasury Shares2 iMoneyNet Treasury Retail Money Funds Average6 | 0.37%4 0.33% |
Tax-Free Shares2,7 iMoneyNet National Retail Tax-Free Money Funds Average6 | 0.41%5 0.39% |
2 The 7-day current yield refers to the income paid by the fund over a 7-day period expressed as an annual percentage rate. Past performance is not indicative of future results. Yields are historical and will fluctuate.
3 The Prime Shares 7-day current yield reflects the effect of a nonrecurring expense adjustment that increased the yield by 0.07% (annualized). Without such adjustment the 7-day current yield would have been 0.45%.
4 The investment advisor has agreed to waive fees/reimburse expenses. In addition, the Treasury Shares 7-day current yield reflects the effect of a nonrecurring expense adjustment that increased the yield by 0.05% (annualized). Without such fee waivers/expense reimbursements and this adjustment the 7-day current yield would have been 0.32%.
5 The Tax-Free Shares 7-day current yield reflects the effect of a nonrecurring expense adjustment that increased the yield by 0.07% (annualized). Without such adjustment the 7-day current yield would have been 0.34%.
6 Money Fund Report Averages, a service of iMoneyNet, Inc., are averages for categories of similar money market funds.
7 For certain investors a portion of the series' income may be subject to the federal alternative minimum tax. Distribution of the series' income may be subject to state and local taxes.
An investment in the fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the fund.
months - and increasingly - short-term securities with maturities of three months or less; we kept the shorter-term securities in each series to meet liquidity needs. In addition, we de-emphasized callable agency securities in the Prime Series as they became a less useful cash management tool as yield spreads compressed. Over the 12-month period, we maintained an average maturity of approximately 50 to 55 days within the Prime Series and the Treasury Series.
Toward the close of 2003, we increased each series allocation in floating-rate securities. The purpose of this strategy is to position each series to benefit if the economy begins to create more jobs and the Fed decides to switch to a tightening bias earlier than expected. The interest rate of floating-rate securities adjusts periodically, based on the position of the yield curve. There are floating-rate securities that adjust daily, monthly and quarterly, based off of indices such as LIBOR and the federal funds rate. During the first quarter of 2004 we also invested in short-term UK mortgage securities, which offered a AAA rating, diversification for the portfolio and similar floating-rate characteristics.
Q: What has been the strategy for the Tax-Free Series?
A: During the period, the supply of short-term municipal paper increased sharply due to sluggish economic growth at the start of the period and a slowdown in individual state and local government tax collections. Increased supply in the overall market was met with a surge in demand, as many investors took a defensive stance within their portfolios.
The views expressed in this report reflect those of the portfolio managers only through the end of the period of the report as stated on the cover. The managers' views are subject to change at any time based on market and other conditions and should not be construed as a recommendation.
Prime Series | Principal Amount ($) | Value ($) |
Certificates of Deposit and Bank Notes 16.2% | ||
Credit Agricole Indosuez AG, 1.12%, 6/30/2004 | 50,000,000 | 50,009,710 |
Credit Lyonnais AG, 1.11%, 9/24/2004 | 28,000,000 | 28,000,000 |
Credit Lyonnais AG, 1.15%, 4/27/2004 | 15,000,000 | 15,000,000 |
Danske Bank, 1.12%, 6/30/2004 | 26,000,000 | 26,000,321 |
Fortis Bank NV, 1.435%, 11/16/2004 | 30,000,000 | 29,997,182 |
HBOS Treasury Service PLC, 1.1%, 8/17/2004 | 50,000,000 | 50,000,000 |
National Australia Bank Ltd., 1.45%, 12/13/2004 | 15,000,000 | 15,018,670 |
Norddeutsche Landesbank Girozentrale, 1.13%, 4/20/2004 | 50,000,000 | 50,000,000 |
Societe Generale, 1.13%, 7/7/2004 | 46,000,000 | 46,000,000 |
Toronto Dominion Bank, 1.315%, 4/15/2004 | 60,000,000 | 59,999,827 |
Westdeutsche Landesbank Girozentrale, 1.04%, 5/28/2004 | 100,000,000 | 99,996,858 |
Westdeutsche Landesbank AG, 1.32%, 4/15/2004 | 29,000,000 | 28,999,889 |
Total Certificates of Deposit and Bank Notes (Cost $499,022,457) | 499,022,457 | |
Commercial Paper 31.9% | ||
Apreco LLC, 1.03%**, 4/1/2004 | 7,000,000 | 7,000,000 |
Archer-Daniels-Midland Co., 1.04%**, 6/29/2004 | 25,000,000 | 24,935,722 |
Bristol-Myers Squibb Co., 1.03%**, 4/7/2004 | 40,000,000 | 39,993,133 |
Cancara Asset Security Ltd., 1.05%**, 6/1/2004 | 40,000,000 | 39,928,833 |
Cancara Asset Security Ltd., 1.006%**, 6/21/2004 | 29,120,000 | 29,051,204 |
CC (USA), Inc., 144A, 1.335%, 8/13/2004 | 25,000,000 | 25,000,000 |
Charta LLC, 1.03%**, 4/27/2004 | 30,000,000 | 29,977,683 |
CIT Group, Inc., 1.07%**, 6/14/2004 | 15,000,000 | 14,967,008 |
CIT Group, Inc., 1.1%**, 8/17/2004 | 25,000,000 | 24,894,584 |
DEPFA Bank Europe PLC, 1.163%**, 11/19/2004 | 50,000,000 | 49,619,778 |
Dorada Finance, Inc., 1.006%**, 6/22/2004 | 20,000,000 | 19,952,167 |
General Electric Capital Corp., 1.16%, 5/4/2004 | 40,000,000 | 39,957,467 |
General Electric Capital International Funding, Inc., 1.04%**, 4/21/2004 | 25,000,000 | 24,985,556 |
Giro Funding US Corp., 1.035%**, 4/26/2004 | 25,000,000 | 24,982,031 |
Goldman Sachs Group, Inc., 1.16%, 9/3/2004 | 20,000,000 | 20,000,000 |
Goldman Sachs Group, Inc., 1.24%, 7/8/2004 | 49,000,000 | 49,000,000 |
Goldman Sachs Group, Inc., 1.27%, 11/8/2004 | 22,000,000 | 22,000,000 |
Grampian Funding Ltd., 1.05%**, 6/7/2004 | 10,000,000 | 9,980,458 |
Grampian Funding Ltd., 1.05%**, 6/11/2004 | 86,000,000 | 85,821,909 |
Greyhawk Funding LLC, 1.05%**, 5/21/2004 | 25,000,000 | 24,963,541 |
Greyhawk Funding LLC, 1.05%**, 5/26/2004 | 25,000,000 | 24,959,896 |
Greyhawk Funding LLC, 1.05%**, 7/6/2004 | 20,000,000 | 19,944,000 |
Irish Life & Permanent PLC, 1.1%**, 8/11/2004 | 25,000,000 | 24,899,167 |
Jupiter Securitization Corp., 1.03%**, 4/22/2004 | 20,000,000 | 19,987,983 |
Jupiter Securitization Corp., 1.03%**, 4/27/2004 | 30,000,000 | 29,977,684 |
K2 (USA) LLC, 1.13%**, 4/20/2004 | 32,800,000 | 32,780,438 |
Lake Constance Funding LLC, 1.03%**, 4/22/2004 | 34,900,000 | 34,879,031 |
Perry Global Funding LLC, 0.953%**, 5/17/2004 | 34,966,000 | 34,918,640 |
RWE AG, 1.04%**, 5/3/2004 | 20,000,000 | 19,981,511 |
RWE AG, 1.07%**, 9/8/2004 | 40,000,000 | 39,809,778 |
Scaldis Capital LLC, 1.007%**, 6/15/2004 | 25,000,000 | 24,945,834 |
Scaldis Capital LLC, 0.969%**, 4/26/2004 | 10,000,000 | 9,992,847 |
Sheffield Receivables Corp., 1.04%**, 4/2/2004 | 30,000,000 | 29,999,133 |
Sheffield Receivables Corp., 1.03%**, 4/7/2004 | 25,090,000 | 25,085,693 |
Total Commercial Paper (Cost $979,172,709) | 979,172,709 | |
Floating Rate Notes* 10.8% | ||
American Honda Finance Corp., 144A, 1.06%, 9/16/2004 | 15,000,000 | 15,000,000 |
American Honda Finance Corp., 144A, 1.09%, 7/9/2004 | 30,000,000 | 30,000,000 |
American Honda Finance Corp., 144A, 1.1%, 4/8/2004 | 15,000,000 | 14,999,971 |
Bank of America NA, 1.05%, 8/16/2004 | 12,000,000 | 12,000,000 |
Bayerische Landesbank Girozentrale, 1.05%, 8/25/2004 | 20,000,000 | 19,999,975 |
Canadian Imperial Bank of Commerce, 1.045%, 5/28/2004 | 50,000,000 | 49,998,829 |
General Electric Capital Corp., 1.23%, 5/7/2004 | 10,000,000 | 10,001,460 |
Lehman Brothers Holdings, Inc., 1.06%, 9/7/2004 | 20,000,000 | 20,000,000 |
Merrill Lynch & Co., Inc., 1.1%, 2/4/2005 | 15,000,000 | 15,000,000 |
Natexis Banque Populaires, 1.045%, 10/20/2004 | 20,000,000 | 19,997,767 |
Natexis Banque Populaires, 1.2%, 5/10/2004 | 35,000,000 | 35,000,000 |
SunTrust Bank NA, 1.03%, 4/1/2005 | 40,000,000 | 40,003,980 |
Toyota Motor Credit Corp., 1.03%, 3/31/2005 | 50,000,000 | 50,000,000 |
Total Floating Rate Notes (Cost $332,001,982) | 332,001,982 | |
Short -Term Notes 6.0% | ||
Bear Stearns & Co., Inc., 1.213%, 1/1/2044 | 100,000,000 | 100,000,000 |
Permanent Financing PLC, "1A", Series 4, 1.05%, 3/10/2005 | 25,000,000 | 25,000,000 |
Providence of Ontario, 7.625%, 6/22/2004 | 25,000,000 | 25,363,875 |
Statens Bostadsfinansierings-aktiebulag, 1.145%, 5/28/2004 | 35,000,000 | 35,002,420 |
Total Short-Term Notes (Cost $185,366,295) | 185,366,295 | |
US Government Sponsored Agencies 9.1% | ||
Federal Home Loan Bank, 0.985%**, 9/12/2005 | 30,000,000 | 29,973,851 |
Federal Home Loan Bank, 1.5%, 11/16/2004 | 30,000,000 | 30,000,000 |
Federal Home Loan Mortgage Corp., 1.19%, 2/14/2005 | 15,000,000 | 15,000,000 |
Federal Home Loan Mortgage Corp., 1.2%, 8/6/2004 | 35,000,000 | 35,000,000 |
Federal Home Loan Mortgage Corp., 3.25%, 11/15/2004 | 15,000,000 | 15,159,177 |
Federal National Mortgage Association, 1.115%**, 4/28/2004 | 36,111,000 | 36,080,802 |
Federal National Mortgage Association, 1.064%**, 9/10/2004 | 20,000,000 | 19,902,800 |
Federal National Mortgage Association, 1.01%**, 1/18/2005 | 40,000,000 | 39,984,735 |
Federal National Mortgage Association, 1.03%**, 2/18/2005 | 40,000,000 | 39,994,677 |
Federal National Mortgage Association, 3.0%, 6/15/2004 | 17,000,000 | 17,065,529 |
Total US Government Sponsored Agencies (Cost $278,161,571) | 278,161,571 | |
Government National Mortgage Association 1.3% | ||
Government National Mortgage Association, 1.03%**, 4/1/2004 | 18,751,000 | 18,751,000 |
Government National Mortgage Association, 1.08%, 7/23/2004 | 20,000,000 | 20,000,000 |
Total Government National Mortgage Association (Cost $38,751,000) | 38,751,000 | |
Funding Agreements 5.1% | ||
General Electric Capital Assurance Corp., 1.2%, 9/1/2004 | 45,000,000 | 45,000,000 |
General Electric Capital Assurance Corp., 1.2%, 3/1/2005 | 20,000,000 | 20,000,000 |
New York Life Insurance, 1.18%, 9/21/2004 | 40,000,000 | 40,000,000 |
Travelers Insurance Co., 1.19%, 1/27/2005 | 50,000,000 | 50,000,000 |
Total Funding Agreements (Cost $155,000,000) | 155,000,000 | |
Repurchase Agreements 19.6% | ||
Repurchase Agreement with J.P. Morgan Chase, 1.09%, dated 3/31/2004, principal and interest in the amount of $41,452,270, due 4/1/2004 (b) | 41,451,015 | 41,451,015 |
Repurchase Agreement with Merrill Lynch & Co., Inc., 1.04%, dated 3/31/2004, principal and interest in the amount of $50,018,778, due 4/13/2004 (c) | 50,000,000 | 50,000,000 |
Repurchase Agreement with Morgan Stanley, 1.09%, dated 3/31/2004, principal and interest in the amount of $250,007,569, due 4/1/2004 (d) | 250,000,000 | 250,000,000 |
Repurchase Agreement with UBS Warburg, 1.09%, dated 3/31/2004, principal and interest in the amount of $260,007,872, due 4/1/2004 (e) | 260,000,000 | 260,000,000 |
Total Repurchase Agreements (Cost $601,451,015) | 601,451,015 | |
Total Investment Portfolio -100.0% (Cost $3,068,927,029) (a) | 3,068,927,029 |
* Floating rate notes are securities whose yields vary with a designated market index or market rate, such as the coupon-equivalent of the US Treasury bill rate. These securities are shown at their current rate as of March 31, 2004.
** Annualized yield at the time of purchase; not a coupon rate.
(a) Cost for federal income tax purpose was $3,068,927,029.
(b) Collateralized by:
Principal Amount ($) | Type | Rate (%) | Maturity | Collateral | |
29,245,750 | Federal Home Loan Mortgage Corporation | 5.5-6.0 | 11/1/2031-3/1/2034 | 30,134,759 | |
12,185,151 | Federal National Mortgage Association | 5.0-6.0 | 3/1/2018-10/1/2032 | 12,652,750 | |
Total Collateral Value | 42,787,509 |
(c) Collateralized by:
Principal Amount ($) | Type | Rate (%) | Maturity | Collateral | |
10,861,894 | Federal Home Loan Mortgage Corporation | 5.5-8.0 | 9/1/2021-12/1/2033 | 11,377,481 | |
38,612,080 | Federal National Mortgage Association | 5.0-8.0 | 12/1/2016-12/1/2033 | 40,123,282 | |
Total Collateral Value | 51,500,763 |
(d) Collateralized by:
Principal Amount ($) | Type | Rate (%) | Maturity | Collateral | |
122,995,177 | Federal National Mortgage Association | 0.00-11.73 | 4/19/2004-10/25/2033 | 122,672,404 | |
105,411,488 | Federal Home Loan Mortgage Corporation | 0.55-10.00 | 12/8/2004-3/15/2034 | 110,183,796 | |
9,526,784 | Government National Mortgage Association | 4.25-5.50 | 4/20/2017-11/20/2033 | 9,826,840 | |
4,622,000 | Resolution Funding Corporation | 0.00-9.38 | 10/15/2009-1/15/2030 | 2,712,807 | |
570,000 | Tennessee Valley Authority | 0.00-5.38 | 11/13/2008-5/1/2030 | 232,578 | |
6,905,000 | East Coast Power LLC | 6.74 | 3/31/2008 | 6,990,761 | |
1,505,000 | US Treasury Note Strip | 0.00 | 2/15/2006 | 1,461,581 | |
15,000 | Financing Corp. | 8.60 | 9/26/2019 | 21,033 | |
Total Collateral Value | 254,101,800 |
(e) Collateralized by:
Principal Amount ($) | Type | Rate (%) | Maturity | Collateral | |
130,758,977 | Federal Home Loan Mortgage Corporation | 3.511-5.429 | 4/1/2031-12/1/2033 | 135,231,617 | |
125,333,070 | Federal National Mortgage Association | 3.36-6.13 | 8/1/2011-2/1/2034 | 129,970,370 | |
Total Collateral Value | 265,201,987 |
144A: Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers.
The accompanying notes are an integral part of the financial statements.
Schedule of Investments as of March 31, 2004 |
Treasury Series | Principal Amount ($) | Value ($) |
US Government Backed 100.0% | ||
US Treasury Bills, 0.895%*, 5/13/2004 | 25,000,000 | 24,973,750 |
US Treasury Bills, 0.91%*, 5/20/2004 | 20,000,000 | 19,975,092 |
US Treasury Bills, 0.92%*, 5/6/2004 | 60,000,000 | 59,946,042 |
US Treasury Bills, 0.93%*, 5/27/2004 | 30,000,000 | 29,957,067 |
US Treasury Bills, 0.93%*, 6/10/2004 | 25,000,000 | 24,954,549 |
US Treasury Bills, 0.94%*, 6/3/2004 | 40,000,000 | 39,934,550 |
US Treasury Bills, 0.945%*, 6/17/2004 | 35,000,000 | 34,930,379 |
US Treasury Bills, 0.945%*, 7/1/2004 | 45,000,000 | 44,891,495 |
US Treasury Bills, 0.95%*, 4/29/2004 | 71,383,000 | 71,329,268 |
US Treasury Bills, 0.96%*, 4/1/2004 | 68,277,000 | 68,277,000 |
US Treasury Bills, 0.96%*, 4/8/2004 | 34,482,000 | 34,475,668 |
US Treasury Bills, 0.96%*, 4/15/2004 | 50,874,000 | 50,856,236 |
US Treasury Note, 2.125%, 8/31/2004 | 6,000,000 | 6,021,394 |
US Treasury Note, 2.875%, 6/30/2004 | 15,000,000 | 15,070,206 |
US Treasury Note, 3.375%, 4/30/2004 | 35,000,000 | 35,067,124 |
Total Investment Portfolio - 100.0% (Cost $560,659,820) (a) | 560,659,820 |
* Annualized yield at time of purchase; not a coupon rate.
(a) Cost for federal income tax purposes was $560,659,820.
The accompanying notes are an integral part of the financial statements.
Schedule of Investments as of March 31, 2004 |
Tax-Free Series | Principal Amount ($) | Value ($) |
Municipal Investments 100.0% | ||
Alabama 2.7% | ||
Alabama, Housing Finance Authority, Multi-family Housing Revenue, Heatherbrooke Project, Series C, 1.11%*, 6/15/2026 (c) | 8,200,000 | 8,200,000 |
Alabama, Housing Finance Authority, Multi-family Housing Revenue, Rime Village Hoover Project, Series A, 1.11%*, 6/15/2026 (c) | 7,500,000 | 7,500,000 |
Birmingham, Waterworks and Sewer Revenue, Series 2003-A, 1.08%*, 1/1/2043 (c) | 2,500,000 | 2,500,000 |
Evergreen, Industrial Development Authority, Tenax Manufacturing Project, 1.01%*, 12/1/2012 (b) | 2,700,000 | 2,700,000 |
Jefferson County, Sewer Revenue, Series A, 1.0%*, 2/1/2042 (c) | 4,600,000 | 4,600,000 |
25,500,000 | ||
Alaska 1.0% | ||
Alaska, State General Obligation, Series 1825, 1.07%*, 2/1/2011 (b) (c) | 6,550,000 | 6,550,000 |
Anchorage, Core City, General Obligation, Series II-R, 1.08%*, 6/1/2019 (c) | 2,985,000 | 2,985,000 |
9,535,000 | ||
Arizona 1.1% | ||
Apache County, Industrial Development Authority, Series 83A, 1.05%*, 12/15/2018 (b) | 2,100,000 | 2,100,000 |
Salt River, Agricultural Improvement and Power District,1.0%, 6/8/2004 | 8,800,000 | 8,800,000 |
10,900,000 | ||
California 4.3% | ||
California, Community Finance Authority, Tax and Revenue Anticipation Notes, Series A, 2.0%, 6/30/2004 | 6,000,000 | 6,017,605 |
California, Multi-family Housing Finance Agency Revenue, Series D, 0.91%*, 2/1/2035 (b) | 100,000 | 100,000 |
California, Revenue Anticipation Notes, Series A-3, 2.0%, 6/23/2004 (b) | 20,000,000 | 20,042,021 |
California, State Department of Water Resources, Power Supply Revenue, Series C-9, 1.0%*, 5/1/2022 (b) | 1,250,000 | 1,250,000 |
California, State General Obligation, Series 819-D, 1.1%*, 2/1/2028 (c) | 3,000,000 | 3,000,000 |
California, Statewide Communities Development Authority Revenue, Tax and Revenue Anticipation Notes, Series A-3, 2.0%, 6/30/2004 | 2,000,000 | 2,005,107 |
San Diego, Union School District, Series 847, 1.05%*, 7/1/2020 (c) | 1,495,000 | 1,495,000 |
Ventura County, Tax & Revenue Anticipation Notes, 1.5%, 7/1/2004 | 7,000,000 | 7,009,627 |
40,919,360 | ||
Colorado 3.6% | ||
Colorado, State General Obligation NCS03, 1.75%, 6/25/2004 | 18,070,000 | 18,106,168 |
Colorado, Transportation/Tolls Revenue, Transportation Department, 1.08%*, 12/15/2016 (c) | 3,335,000 | 3,335,000 |
Denver, City and County Excise Tax Revenue, Series PT-1827, 1.07%*, 11/1/2010 (c) | 1,740,000 | 1,740,000 |
Traer Creek, Metropolitan District Revenue, 1.07%*, 10/1/2021 (b) | 11,500,000 | 11,500,000 |
34,681,168 | ||
Delaware 0.7% | ||
Delaware, Economic Development Authority, Series A, 1.05%*, 12/1/2015 (b) (c) | 6,600,000 | 6,600,000 |
District of Columbia 1.1% | ||
District of Columbia, General Obligation, Series D, 1.05%*, 6/1/2029 (b) (c) | 4,200,000 | 4,200,000 |
District of Columbia, General Obligation, Multimodal-Medlantic: | ||
Series A, 1.03%*, 6/1/2015 (b) (c) | 2,300,000 | 2,300,000 |
Series B, 1.03%*, 6/1/2030 (b) (c) | 4,100,000 | 4,100,000 |
10,600,000 | ||
Florida 9.3% | ||
Florida, Transportation/Tolls Revenue, Turnpike Authority, Series R-4041, 1.08%*, 7/1/2020 (c) | 12,065,000 | 12,065,000 |
Florida, Board of Education, Lottery Revenue, 1.07%*, 1/1/2009 (c) | 4,200,000 | 4,200,000 |
Highlands County, Hospital and Health Care Revenue, Health Facilities Authority, Adventist Health Systems, Series B, 1.03%*, 11/15/2009 (b) | 24,010,000 | 24,010,000 |
Jacksonville, Electric Authority Revenue, Electric Systems, 0.98%, 4/6/2004 | 14,000,000 | 14,000,000 |
Jacksonville, Electric Authority Revenue, 1.0%, 8/10/2004 | 4,000,000 | 4,000,000 |
Jacksonville, Health Facilities Authority, Hospital Revenue, Series A, 1.1%*, 8/15/2033 (b) | 4,425,000 | 4,425,000 |
Miami-Dade County, School Board Certificates of Participation, Series R-4022, 1.08%*, 8/1/2021 (b) (c) | 3,130,000 | 3,130,000 |
Orlando, FL, Utility Committee: | ||
0.98%, 6/7/2004 | 3,300,000 | 3,300,000 |
1.0%, 6/8/2004 | 12,600,000 | 12,600,000 |
Pasco County, School Board Certificates of Participation, 1.02%*, 8/1/2026 (b) (c) | 6,200,000 | 6,200,000 |
Tampa, Health Care Facilities Revenue, Lifelink Foundation, Inc. Project, 1.02%*, 8/1/2022 (b) | 1,300,000 | 1,300,000 |
89,230,000 | ||
Georgia 9.2% | ||
Atlanta, Airport Revenue: | ||
Series B-1, 1.03%*, 1/1/2030 (b) (c) | 15,000,000 | 15,000,000 |
Series C-1, 1.03%*, 1/1/2030 (b) (c) | 1,000,000 | 1,000,000 |
Burke County, Development Authority Pollution Control Revenue, Oglethorpe Power Corp., 1.1%*, 1/1/2022 (b) (c) | 2,600,000 | 2,600,000 |
Cobb County, Development Authority Revenue, MT Paran Christian School Project, 1.01%*, 7/1/2022 (b) | 4,000,000 | 4,000,000 |
Cobb County, Housing Authority, Multi-family Housing Revenue, Post Mill Project, 1.05%*, 6/1/2025 (c) | 7,880,000 | 7,880,000 |
Columbus, Housing Authority Revenue, Columbus State University Foundation, Inc., 1.02%*, 11/1/2017 (b) | 2,800,000 | 2,800,000 |
De Kalb County, Housing Authority, Multi-family Housing Revenue, Post Ashford Project, 1.05%*, 6/1/2025 (c) | 8,895,000 | 8,895,000 |
Fayette County, Development Authority, Educational Facilities Revenue, Catholic School Properties, Inc., Project, 1.01%*, 4/1/2024 (b) | 3,500,000 | 3,500,000 |
Fulco, Hospital Authority Revenue, Piedmont Hospital Project, 1.02%*, 3/1/2024 (b) | 2,705,000 | 2,705,000 |
Fulton County, Development Authority Revenue, Donnellan School Project, 1.01%*, 7/1/2020 (b) | 1,950,000 | 1,950,000 |
Fulton County, Development Authority Revenue, Lovett School Project, 1.05%*, 7/1/2026 (b) | 2,000,000 | 2,000,000 |
Georgia, Municipal Electric Authority: | ||
Series 1985-B, 0.93%, 4/8/2004 | 4,000,000 | 4,000,000 |
Series 1985-B, 0.95%, 4/8/2004 | 15,000,000 | 15,000,000 |
Macon-Bibb County, Hospital Authority Revenue, Medical Center of Central Georgia, 1.02%*, 8/1/2018 (b) | 2,600,000 | 2,600,000 |
Monroe County, Development Authority, Pollution Control Revenue, Oglethorpe Power, Series B, 1.1%*, 1/1/2020 (b) (c) | 2,400,000 | 2,400,000 |
Monroe County, GA, Development Authority Pollution Control Revenue, Oglethorpe Power Corp. Project, 1.1%*, 1/1/2018 (c) | 3,000,000 | 3,000,000 |
Roswell, Housing Authority Revenue, Multi-family Housing Revenue, Post Canyon Project, 1.05%*, 6/1/2025 (c) | 8,500,000 | 8,500,000 |
87,830,000 | ||
Hawaii 0.9% | ||
Hawaii, General Obligation, Series R-4545, 1.08%*, 8/1/2020 (c) | 5,225,000 | 5,225,000 |
Hawaii, State Department of Budget & Finance, Kahala Nui Project, Series D, 1.02%*, 11/15/2033 (b) | 2,900,000 | 2,900,000 |
8,125,000 | ||
Illinois 5.4% | ||
Chicago, General Obligation: | ||
Series B, 1.04%*, 1/1/2037 (b) (c) | 3,900,000 | 3,900,000 |
Series A, 1.08%*, 1/1/2042 (c) | 2,690,000 | 2,690,000 |
Chicago, Sales Tax Revenue, 1.05%*, 1/1/2034 (b) (c) | 4,600,000 | 4,600,000 |
Cook County, General Obligation, Series 2003-11, 1.07%*, 11/15/2016 (c) | 7,765,000 | 7,765,000 |
Du Page County, Revenue Anticipation Notes, Benedictine University Building Project, 1.04%*, 7/1/2024 (b) | 16,000,000 | 16,000,000 |
Illinois, Development Finance Authority, Chicago Symphony Orchestra, 1.0%*, 12/1/2028 (b) | 500,000 | 500,000 |
Illinois, Development Finance Authority, Chicago Symphony Project, 1.05%*, 12/1/2033 (b) | 7,000,000 | 7,000,000 |
Illinois, Development Finance Authority, Jewish Federation Projects, 1.05%*, 9/1/2024 (b) (c) | 4,070,000 | 4,070,000 |
Illinois, General Obligation, Series B, 1.03%*, 10/1/2033 | 5,600,000 | 5,600,000 |
52,125,000 | ||
Indiana 1.6% | ||
Indiana, Educational Facilities Authority Revenue, Bethel College Project, 1.02%*, 2/1/2034 (b) | 3,300,000 | 3,300,000 |
Indiana, Health Facilities Financing Authority Revenue, Ascension Health, Series B, 1.02%*, 11/15/2039 | 4,200,000 | 4,200,000 |
Indiana, Municipal Power Agency, Power Supplies System Revenue, Refunding, Series A, 1.04%*, 1/1/2018 (b) | 1,200,000 | 1,200,000 |
Indiana, Transportation/Tolls Revenue, Series R-4528, 1.08%*, 6/1/2018 (c) | 2,995,000 | 2,995,000 |
Indianapolis, Water & Sewer Revenue, 1.07%*, 7/1/2033 (c) | 4,000,000 | 4,000,000 |
15,695,000 | ||
Iowa 2.7% | ||
Iowa, Finance Authority Hospital Facilities Revenue, Iowa Health Systems, Series B, 1.05%*, 7/1/2020 (b) (c) | 4,625,000 | 4,625,000 |
Iowa, Finance Authority Hospital Facilities Revenue, Iowa Health Systems, Series B, 1.05%*, 7/1/2015 (b) (c) | 3,300,000 | 3,300,000 |
Iowa, Finance Authority Revenue, Miss VY Regional Blood Center, 1.02%*, 2/1/2023 (b) | 920,000 | 920,000 |
Iowa, School Cash Anticipation Program, Warrant Certificates, Series B, 2.0%, 1/28/2005 (c) | 16,500,000 | 16,631,967 |
25,476,967 | ||
Kentucky 1.4% | ||
Boone County, Pollution Control Revenue, Cincinnati Gas & Electric Co., Series A, 1.05%*, 8/1/2013 (b) | 2,200,000 | 2,200,000 |
Pendleton County, Multi-County Lease Revenue, 1.04%*, 5/14/2004 (b) | 11,000,000 | 11,000,000 |
13,200,000 | ||
Maine 0.7% | ||
Maine, State General Obligation, 1.75%, 6/30/2004 | 6,750,000 | 6,765,629 |
Maryland 1.0% | ||
Maryland, Higher Education Revenue, Economic Development Corporate Student Housing Revenue, 1.01%*, 11/1/2031 (b) | 9,800,000 | 9,800,000 |
Massachusetts 0.4% | ||
Massachusetts, State General Obligation, Central Artery Project, Series A, 1.12%*, 12/1/2030 (b) | 4,200,000 | 4,200,000 |
Michigan 5.5% | ||
ABN Amro Munitops, Certificate Trust, Series 2003-3, 1.11%*, 1/1/2011 (b) (c) | 6,850,000 | 6,850,000 |
Detroit, Economic Development Corp., Waterfront Reclamation, Series A, 1.05%*, 5/1/2009 (b) | 377,000 | 377,000 |
Garden City, Hospital Revenue, Series A, 1.06%*, 9/1/2026 (b) | 1,035,000 | 1,035,000 |
Michigan, Certificate of Participation, Series 350, 1.12%*, 9/1/2011 (c) | 4,885,000 | 4,885,000 |
Michigan, Higher Education Facilities Authority Revenue, University of Detroit, 1.12%*, 11/1/2017 (b) | 2,000,000 | 2,000,000 |
Michigan, Municipal Bond Authority Revenue, Series B-2, 2.0%, 8/23/2004 (b) | 10,000,000 | 10,037,775 |
Michigan, State General Obligation, Series A, 2.0%, 9/30/2004 | 17,000,000 | 17,085,959 |
Michigan, State General Obligation, Community Schools, Series R-4517, 1.08%*, 5/1/2023 | 5,235,000 | 5,235,000 |
Michigan, State Government School Loan, 0.94%, 6/2/2004 | 4,700,000 | 4,700,000 |
Michigan, University of Michigan Hospitals Revenue, Series A, 1.08%*, 12/1/2019 | 150,000 | 150,000 |
52,355,734 | ||
Missouri 0.2% | ||
Missouri, Health & Educational Facilities Authority, Health Facilities Revenue, Barnes Hospital Project, 1.03%*, 12/1/2015 (b) | 1,900,000 | 1,900,000 |
New Jersey 0.8% | ||
New Jersey, Economic Development Authority, Economic Development Revenue, Foreign Trade Zone Project, 1.11%*, 12/1/2007 (b) | 6,065,000 | 6,065,000 |
Salem County, Industrial Pollution Control, Financing Authority Revenue, E.I. Du Point De Nemours and Co., 1.0%*, 3/1/2012 | 1,300,000 | 1,300,000 |
7,365,000 | ||
New Mexico 1.0% | ||
Albuquerque, Airport Facilities Revenue, Series A, 1.12%*, 7/1/2020 (b) (c) | 5,200,000 | 5,200,000 |
Farmington, Hospital Revenue, San Juan Regional Medical Center Project, Series B, 1.03%*, 6/1/2028 (b) | 4,500,000 | 4,500,000 |
9,700,000 | ||
New York 3.1% | ||
Long Island, Power Authority, Electric System Revenue Series 1B, 1.12%*, 5/1/2033 (b) | 2,700,000 | 2,700,000 |
New York, Energy Research & Development Authority, Pollution Control Revenue, NY Electric & Gas, Series C, 1.14%*, 6/1/2029 | 3,100,000 | 3,100,000 |
New York, General Highway & Bridge Trust Fund, Star Certificates, Series 2003-4, 1.04%*, 4/1/2011 (c) | 4,680,000 | 4,680,000 |
New York, General Obligations, Series A-5, 1.0%*, 8/1/2031 (b) | 7,620,000 | 7,620,000 |
Rochester, Health Revenue, 0.97%, 5/13/2004 | 11,150,000 | 11,150,000 |
29,250,000 | ||
North Carolina 1.7% | ||
North Carolina, Medical Care Community Hospital Revenue, Grace Hospital Project, 1.01%*, 10/1/2025 (b) | 16,550,000 | 16,550,000 |
Ohio 2.2% | ||
Akron, Hospital Revenue District, Health Care Facilities, Sumner Project, 1.05%*, 12/1/2032 (b) | 4,840,000 | 4,840,000 |
Franklin County, Senior Care Revenue, Hospital Revenue, Series II-R-55, 1.08%*, 6/1/2017 | 12,000,000 | 12,000,000 |
Huron County, Hospital Facilities Revenue, Fisher-Titus Medical Center: | ||
Series A, 1.04%*, 12/1/2027 (b) | 2,500,000 | 2,500,000 |
Series A, 1.04%*, 12/4/2027 (b) | 1,600,000 | 1,600,000 |
20,940,000 | ||
Oklahoma 1.1% | ||
Payne County, Economic Development Authority, Student Housing Revenue, OSUF Phase III Project, 1.05%*, 7/1/2032 (b) (c) | 7,985,000 | 7,985,000 |
Tulsa County, Industrial Authority Revenue, Series A, 1.12%*, 7/1/2032 (b) | 2,965,000 | 2,965,000 |
10,950,000 | ||
Oregon 0.5% | ||
Portland, Industrial Development Revenue, 1.05%*, 4/1/2035 (b) (c) | 4,500,000 | 4,500,000 |
Pennsylvania 2.0% | ||
Allegheny County, Hospital Development Authority Revenue, UPMC Senior Living Corp., 1.02%*, 7/15/2028 (b) (c) | 4,700,000 | 4,700,000 |
Allegheny County, Hospital Development Authority Revenue, Presbyterian Hospital, Series D, 1.02%*, 3/1/2020 (b) (c) | 1,200,000 | 1,200,000 |
Dauphin County, General Authority, Education & Health Loan Program, 1.1%*, 11/1/2017 (c) | 70,000 | 70,000 |
Delaware Valley, Regional Finance Authority Revenue: | ||
1.04%*, 8/1/2016 (b) | 3,200,000 | 3,200,000 |
Series PT-784, 1.07%*, 7/1/2026 (b) | 5,780,000 | 5,780,000 |
Pennsylvania, State School District (REV) Lease, Public School Building Authority, 1.1%*, 6/1/2028 (b) (c) | 1,500,000 | 1,500,000 |
Philadelphia, Redevelopment Authority Housing Revenue, Multi-family Courts Project, Series A, 1.06%*, 6/1/2025 (b) | 2,155,000 | 2,155,000 |
Washington County, Authority Lease Revenue, Higher Education Equipment Lease, 1.06%*, 11/1/2005 (b) | 800,000 | 800,000 |
19,405,000 | ||
Puerto Rico 0.2% | ||
Puerto Rico, State GO, Series 813-D, 1.07%*, 7/1/2020 (c) | 1,980,000 | 1,980,000 |
South Carolina 2.2% | ||
South Carolina, Jobs Economic Development Authority, Baptist Ministries, Inc., 1.01%*, 7/1/2020 (b) | 380,000 | 380,000 |
South Carolina, Jobs Economic Development Authority, Heathwood Hall Episcopal, 1.01%*, 8/1/2029 (b) | 8,600,000 | 8,600,000 |
South Carolina, Project Revenue, Jobs Economic Development Authority, Sisters of Charity Hospitals, 1.06%*, 11/1/2032 (b) | 10,000,000 | 10,000,000 |
South Carolina, Transition Infrastructure Bank Redevelopment, Series R-267, 1.08%*, 10/1/2033 (c) | 2,500,000 | 2,500,000 |
21,480,000 | ||
Tennessee 3.6% | ||
Clarksville, Public Building Authority Revenue, Pooled Program, 1.1%*, 7/1/2031 (b) | 5,795,000 | 5,795,000 |
Memphis, General Obligation: | ||
Series A, 1.08%*, 8/1/2004 | 585,000 | 585,000 |
Series A, 1.08%*, 8/1/2007 | 2,800,000 | 2,800,000 |
Montgomery County, Public Building Authority Pooled Financing Revenue, 1.1%*, 4/1/2032 (b) | 1,800,000 | 1,800,000 |
Nashville & Davidson County, Industrial Development Board Revenue, Nashville Symphony Hall Project, 1.05%*, 12/1/2031 (b) | 15,000,000 | 15,000,000 |
Shelby County, General Obligation, 2.0%, 6/30/2004 | 4,900,000 | 4,912,521 |
Shelby County, Health Educational Authority, 0.96%, 4/29/2004 | 4,000,000 | 4,000,000 |
34,892,521 | ||
Texas 17.7% | ||
Austin, Electric Revenue, Electric Utility Systems Revenue, Series 2003-A, 1.08%*, 11/15/2028 (b) (c) | 2,650,000 | 2,650,000 |
Corpus Christi, Electric Revenue, Utility Systems Revenue, 1.09%*, 7/15/2010 (b) (c) | 3,945,000 | 3,945,000 |
Cypress-Fairbanks, School District, General Obligation, Independent School District, 1.08%*, 2/15/2025 | 1,425,000 | 1,425,000 |
Georgetown, Higher Education Finance, Southwestern University, 1.05%*, 10/1/2014 (b) | 2,000,000 | 2,000,000 |
Harris County, Health Facilities Development Corp. Revenue, Methodist Hospital, 1.12%*, 12/1/2032 | 14,000,000 | 14,000,000 |
Houston, Airport System Revenue, Special Facilities, 1.08%*, 7/1/2032 (b) (c) | 10,000,000 | 10,000,000 |
Houston, General Obligation, Series C, 0.95%*, 6/3/2004 | 10,000,000 | 10,000,000 |
Houston, Water & Sewer Revenue: | ||
Series A, 0.98%, 5/25/2004 | 10,000,000 | 10,000,000 |
Series A, 1.0%, 5/13/2004 | 5,000,000 | 5,000,000 |
Series 120, 1.07%*, 12/1/2023 | 6,900,000 | 6,900,000 |
Series 2003-14, 1.07%*, 6/1/2026 (c) | 1,200,000 | 1,200,000 |
Houston, Health Facilities Development Corp., Retirement Facilities Revenue, Buckingham Senior Living Center, Series C, 1.02%*, 2/15/2034 (b) | 22,690,000 | 22,690,000 |
Houston, Tax & Revenue Anticipation Notes, 1.5%, 6/30/2004 | 15,000,000 | 15,019,891 |
Texas, Electric Revenue, Lower Colorado River Authority, Series PT-1818, 1.07%*, 5/15/2010 (b) (c) | 4,275,000 | 4,275,000 |
Texas, Higher Education Revenue, University of Texas, Series B-14, 1.08%*, 8/15/2022 | 2,000,000 | 2,000,000 |
Texas, State (REV) Lease, Trust Certificates, Series 9056, 144A, 1.1%*, 7/21/2010 (c) | 10,990,000 | 10,990,000 |
Texas, State General Obligation: | ||
Series 2003-A, 1.08%*, 10/1/2015 (b) | 2,400,000 | 2,400,000 |
Series R-4020, 1.08%*, 10/1/2022 | 3,600,000 | 3,600,000 |
Texas, Tax & Revenue Anticipation Notes, 2.0%, 8/31/2004 | 37,000,000 | 37,134,645 |
Texas, Water & Sewer Revenue, Water Development Board Revenue, State Revolving Fund, 1.08%*, 7/15/2022 (b) | 4,000,000 | 4,000,000 |
169,229,536 | ||
Utah 0.6% | ||
Alpine, General Obligation, School District, Series 436, 1.07%*, 3/15/2007 (b) | 5,000,000 | 5,000,000 |
Salt Lake County, Pollution Control Revenue, Service Station Holdings Project, 1.12%*, 2/1/2008 | 1,170,000 | 1,170,000 |
6,170,000 | ||
Virginia 2.5% | ||
Chesapeake Bay, Transportation/Tolls Revenue, Bridge and Tunnel Commission, Series A 39, 1.1%*, 7/1/2025 (b) (c) | 3,185,000 | 3,185,000 |
Fairfax County, Economic Development Authority Revenue, Flint Hill School Project, 1.01%*, 10/1/2025 (b) | 19,370,000 | 19,370,000 |
Spotsylvania County, Industrial Development Authority Revenue, 1.06%*, 4/1/2023 (b) | 1,500,000 | 1,500,000 |
24,055,000 | ||
Washington 5.1% | ||
Port Tacoma, State General Obligation, Core City, Series R-4036, 1.08%*, 12/1/2025 (c) | 5,600,000 | 5,600,000 |
Seattle, Port Authority Revenue, Series 849-D, 1.07%*, 7/1/2021 (c) | 8,992,000 | 8,992,000 |
Snohomish County, General Obligation, Series B33, 1.1%*, 12/1/2027 (b) (c) | 3,495,000 | 3,495,000 |
Tacoma, General Obligation, 0.95%, 6/15/2004 | 3,000,000 | 3,000,000 |
Washington, Electric Revenue, Northwest Energy, 1.08%*, 7/1/2017 (c) | 9,970,000 | 9,970,000 |
Washington, Energy Northwest Electric Revenue, Series R 4524, 1.08%*, 7/1/2018 (c) | 5,485,000 | 5,485,000 |
Washington, Healthcare Facilities Authority Revenue, Providence Services, Series A, 1.12%*, 12/1/2030 (c) | 2,300,000 | 2,300,000 |
Washington, Municipal Securities Trust Certificates, Series 9058, 144A, 1.1%*, 9/23/2010 (c) | 9,990,000 | 9,990,000 |
48,832,000 | ||
West Virginia 0.2% | ||
Monongalia County, Building Commission Hospital Revenue, Monongalia General Hospital, Series A, 1.05%*, 7/1/2017 (b) | 2,000,000 | 2,000,000 |
Wisconsin 0.8% | ||
Milwaukee, Water & Sewer Revenue, 1.08%*, 6/1/2022 (c) | 3,625,000 | 3,625,000 |
Wisconsin, Transportation Authority Revenue, 0.95%, 4/14/2004 | 4,473,000 | 4,473,000 |
8,098,000 | ||
Multi-State 1.9% | ||
ABN Amro Munitops, Munitops Certificate Trust, Series 2003-32, 1.12%*, 1/15/2012 (c) | 18,000,000 | 18,000,000 |
Total Investment Portfolio - 100.0% (Cost $958,835,915) (a) | 958,835,915 |
* Variable rate demand notes are securities whose interest rates are reset periodically at market levels. These securities are often payable on demand and are shown at their current rate as of March 31, 2004.
(a) The cost for federal income tax purposes was $958,837,579. At March 31, 2004, net unrealized depreciation for all securities based on tax cost was $1,664. This consisted of aggregate gross unrealized depreciation for all securities in which there was an excess of tax cost over value of $1,664.
(b) Security includes a letter of credit or line of credit from a major bank.
(c) Bond is insured by one of these companies:
Insurance Coverage | As a % of Total Investment Portfolio | |
AMBAC | AMBAC Assurance Corp. | 7.7% |
FGIC | Financial Guaranty Insurance Company | 5.4% |
FNMA | Federal National Mortgage Association | 4.8% |
FSA | Financial Security Assurance | 7.1% |
MBIA | Municipal Bond Investors Assurance | 10.9% |
144A: Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers.
The accompanying notes are an integral part of the financial statements.
Statements of Assets and Liabilities as of March 31, 2004 | |||
Assets | Prime Series | Treasury Series | Tax-Free Series |
Investments: Investments, at amortized cost | $ 2,467,476,014 | $ 560,659,820 | $ 958,835,915 |
Repurchase agreements, at amortized cost | 601,451,015 | - | - |
Total Investments, at amortized cost | 3,068,927,029 | 560,659,820 | 958,835,915 |
Cash | 666,727 | 181 | - |
Receivable for securities sold | - | - | 12,105,053 |
Interest receivable | 5,199,030 | 616,599 | 2,889,862 |
Receivable for Fund shares sold | - | 211,474 | 58,271 |
Due from Advisor | 354,980 | 21,766 | 81,074 |
Other assets | 71,138 | 7,434 | 54,823 |
Total assets | 3,075,218,904 | 561,517,274 | 974,024,998 |
Liabilities | |||
Due to custodian bank | - | - | 72,211 |
Dividends payable | 194 | 1,643 | - |
Payable for Fund shares redeemed | 124,149 | 211,474 | 58,271 |
Payable for investments purchased | - | 84,879,449 | 2,500,000 |
Accrued management fee | 777,708 | 78,068 | 227,601 |
Accrued distribution fees | 582,594 | 81,711 | 175,980 |
Accrued shareholder servicing fees | 162,436 | 23,470 | 43,911 |
Accrued custodian and accounting fees | 39,289 | 11,955 | 21,575 |
Other accrued expenses and payables | 74,871 | 71,449 | 50,931 |
Total liabilities | 1,761,241 | 85,359,219 | 3,150,480 |
Net assets | $ 3,073,457,663 | $ 476,158,055 | $ 970,874,518 |
Composition of Net Assets | |||
Undistributed net investment income | 119,315 | 28,763 | 59,491 |
Accumulated net realized gain (loss) | 13,329 | 25,598 | (42,843) |
Paid-in capital | 3,073,325,019 | 476,103,694 | 970,857,870 |
Net assets | $ 3,073,457,663 | $ 476,158,055 | $ 970,874,518 |
The accompanying notes are an integral part of the financial statements.
Statements of Assets and Liabilities as of March 31, 2004 (continued) | |||
Net Asset Value | Prime Series | Treasury Series | Tax-Free Series |
Computation of Net Asset Value, Offering and Redemption Price Per Share | |||
Prime Shares, Treasury Shares, and Tax-Free Shares, respectively(a) Net assets | $ 2,665,759,096 | $ 376,820,707 | $ 650,986,125 |
Shares of capital stock outstanding | 2,665,262,348 | 376,709,408 | 650,913,197 |
Net Asset Value per share | $ 1.00 | $ 1.00 | $ 1.00 |
Prime Institutional Shares, Treasury Institutional Shares and Tax-Free Institutional Shares, respectively(b) Net assets | $ 394,967,078 | $ 99,337,348 | $ 319,888,393 |
Shares of capital stock outstanding | 394,935,444 | 99,321,119 | 319,863,925 |
Net Asset Value per share | $ 1.00 | $ 1.00 | $ 1.00 |
Scudder Cash Reserve Prime Class A Shares Net assets | $ 4,754,288 | $ - | $ - |
Shares of capital stock outstanding | 4,758,988 | - | - |
Net Asset Value per share | $ 1.00 | $ - | $ - |
Scudder Cash Reserve Prime Class B Shares Net assets | $ 4,588,696 | $ - | $ - |
Shares of capital stock outstanding | 4,586,256 | - | - |
Net Asset Value per share | $ 1.00 | $ - | $ - |
Scudder Cash Reserve Prime Class C Shares Net assets | $ 138,875 | $ - | $ - |
Shares of capital stock outstanding | 139,006 | - | - |
Net Asset Value per share | $ 1.00 | $ - | $ - |
Quality Cash Reserve Prime Shares Net assets | $ 3,249,630 | $ - | $ - |
Shares of capital stock outstanding | 3,244,592 | - | - |
Net Asset Value per share | $ 1.00 | $ - | $ - |
a Prior to July 31, 2003, the Prime Shares were known as the Deutsche Bank Alex. Brown Cash Reserve Prime Shares, the Treasury Shares were known as the Deutsche Bank Alex. Brown Cash Reserve Treasury Shares and the Tax-Free Shares were known as the Deutsche Bank Alex. Brown Cash Reserve Tax-Free Shares.
b Prior to July 31, 2003, the Prime Institutional Shares were known as the Deutsche Bank Alex. Brown Cash Reserve Prime Institutional Shares, the Treasury Institutional Shares were known as the Deutsche Bank Alex. Brown Cash Reserve Treasury Institutional Shares and the Tax-Free Institutional Shares were known as the Deutsche Bank Alex. Brown Cash Reserve Tax-Free Institutional Shares.
The accompanying notes are an integral part of the financial statements.
Statements of Operations for the year ended March 31, 2004 | |||
Investment Income | Prime Series | Treasury Series | Tax-Free Series |
Interest | $ 36,768,211 | $ 5,083,412 | $ 9,633,760 |
Dividends | 1,822,595 | - | - |
Total Income | 38,590,806 | 5,083,412 | 9,633,760 |
Expenses: | |||
Management fee | 8,639,239 | 1,210,167 | 2,536,550 |
Transfer agent fees | 1,662,872 | 220,781 | 495,880 |
Custodian and accounting fees | 224,203 | 130,391 | 166,457 |
Auditing | 46,814 | 47,153 | 59,076 |
Legal | - | 13,300 | 21,769 |
Directors' fees and expenses | 132,725 | 11,890 | 7,442 |
Reports to shareholders | 168,566 | 1,050 | - |
Registration fees | 181,756 | 59,426 | 67,644 |
Distribution fees | 7,077,730 | 991,851 | 1,757,550 |
Shareholder servicing fees | 1,974,585 | 277,718 | 492,113 |
Other | 85,267 | 7,872 | 20,006 |
Total expenses | 20,193,757 | 2,971,599 | 5,624,487 |
Less: fee waivers and/or expense reimbursements | (43,341) | (249,314) | (488) |
Net expenses | 20,150,416 | 2,722,285 | 5,623,999 |
Net investment income | 18,440,390 | 2,361,127 | 4,009,761 |
Net realized gain (loss) on investment transactions | 32,960 | 25,598 | 16,332 |
Net increase (decrease) in net assets from operations | $ 18,473,350 | $ 2,386,725 | $ 4,026,093 |
The accompanying notes are an integral part of the financial statements.
Prime Series
Statement of Changes in Net Assets | ||
Years Ended March 31, | ||
Increase (Decrease) in Net Assets | 2004 | 2003 |
Operations: Net investment income | $ 18,440,390 | $ 47,885,457 |
Net realized gain (loss) | 32,960 | 12,329 |
Net increase (decrease) in net assets resulting from operations | 18,473,350 | 47,897,786 |
Distributions to shareholders from: Net investment income: Prime Shares | (13,937,204) | (38,057,799) |
Prime Institutional Shares | (4,146,883) | (9,631,429) |
Scudder Cash Reserve Prime Class A Shares | (27,001) | (172,134) |
Scudder Cash Reserve Prime Class B Shares | (5,702) | (54,913) |
Scudder Cash Reserve Prime Class C Shares | (187) | (2,431) |
Quality Cash Reserve Prime Shares | (5,308) | (208,566) |
Total distributions | (18,122,285) | (48,127,272) |
Fund share transactions: (at net asset value of $1.00 per share) Proceeds from shares sold | 3,778,478,261 | 18,093,925,189 |
Reinvestment of distributions | 18,119,786 | 45,429,416 |
Cost of shares redeemed | (4,170,034,415) | (19,822,015,528) |
Net increase (decrease) in net assets from Fund share transactions | (373,436,368) | (1,682,660,923) |
Increase (decrease) in net assets | (373,085,303) | (1,682,890,409) |
Net assets at beginning of period | 3,446,542,966 | 5,129,433,375 |
Net assets at end of period (including undistributed net investment income and accumulated distributions in excess of net investment income of $119,315 and $198,790, respectively) | $ 3,073,457,663 | $ 3,446,542,966 |
The accompanying notes are an integral part of the financial statements.
Treasury Series
Statement of Changes in Net Assets | ||
Years Ended March 31, | ||
Increase (Decrease) in Net Assets | 2004 | 2003 |
Operations: Net investment income | $ 2,361,127 | $ 7,609,398 |
Net realized gain (loss) | 25,598 | 8,557 |
Net increase (decrease) in net assets resulting from operations | 2,386,725 | 7,617,955 |
Distributions to shareholders from: Net investment income: Treasury Shares | (1,566,997) | (5,835,505) |
Treasury Institutional Shares | (801,414) | (1,945,846) |
Total distributions | (2,368,411) | (7,781,351) |
Fund share transactions: (at net asset value of $1.00 per share) Proceeds from shares sold | 818,248,199 | 2,469,372,467 |
Reinvestment of distributions | 2,355,582 | 6,950,836 |
Cost of shares redeemed | (874,905,520) | (2,891,288,689) |
Net increase (decrease) in net assets from Fund share transactions | (54,301,739) | (414,965,386) |
Increase (decrease) in net assets | (54,283,425) | (415,128,782) |
Net assets at beginning of period | 530,441,480 | 945,570,262 |
Net assets at end of period (including undistributed net investment income of $28,763 and $36,047, respectively) | $ 476,158,055 | $ 530,441,480 |
The accompanying notes are an integral part of the financial statements.
Tax-Free Series
Statement of Changes in Net Assets | ||
Years Ended March 31, | ||
Increase (Decrease) in Net Assets | 2004 | 2003 |
Operations: Net investment income | $ 4,009,761 | $ 8,200,017 |
Net realized gain (loss) | 16,332 | 3,379 |
Net increase (decrease) in net assets resulting from operations | 4,026,093 | 8,203,396 |
Distributions to shareholders from net investment income: Tax-Free Shares | (2,209,091) | (6,135,417) |
Tax-Free Institutional Shares | (1,599,231) | (2,065,686) |
Total distributions | (3,808,322) | (8,201,103) |
Fund share transactions: (at net asset value of $1.00 per share) Proceeds from shares sold | 1,472,948,677 | 4,079,225,358 |
Reinvestment of distributions | 3,808,152 | 7,213,972 |
Cost of shares redeemed | (1,404,230,862) | (4,363,060,601) |
Net increase (decrease) in net assets from Fund share transactions | 72,525,967 | (276,621,271) |
Increase (decrease) in net assets | 72,743,738 | (276,618,978) |
Net assets at beginning of period | 898,130,780 | 1,174,749,758 |
Net assets at end of period (including undistributed net investment income and accumulated distributions in excess of net investment income of $59,491 and $141,948, respectively) | $ 970,874,518 | $ 898,130,780 |
The accompanying notes are an integral part of the financial statements.
Prime Sharesa | |||||
Years Ended March 31, | 2004 | 2003 | 2002 | 2001 | 2000 |
Selected Per Share Data | |||||
Net asset value, beginning of period | $ 1.00 | $ 1.00 | $ 1.00 | $ 1.00 | $ 1.00 |
Net investment income | .0050 | .0108 | .0270 | .0578 | .0480 |
Less: Distributions from net investment income | (.0050) | (.0108) | (.0270) | (.0578) | (.0480) |
Net asset value, end of period | $ 1.00 | $ 1.00 | $ 1.00 | $ 1.00 | $ 1.00 |
Total Return (%) | .50 | 1.08 | 2.74 | 5.94 | 4.90 |
Ratios to Average Net Assets and Supplemental Data | |||||
Net assets, end of period ($ in thousands) | 2,665,759 | 2,879,253 | 4,320,764 | 5,735,781 | 5,772,616 |
Ratio of expenses (%) | .67 | .70 | .67 | .66 | .66 |
Ratio of net investment income (%) | .51 | 1.10 | 2.76 | 5.77 | 4.86 |
Prime Institutional Sharesb | |||||
Years Ended March 31, | 2004 | 2003 | 2002 | 2001 | 2000 |
Selected Per Share Data | |||||
Net asset value, beginning of period | $ 1.00 | $ 1.00 | $ 1.00 | $ 1.00 | $ 1.00 |
Net investment income | .0087 | .0140 | .0302 | .0610 | .0511 |
Less: Distributions from net investment income | (.0087) | (.0140) | (.0302) | (.0610) | (.0511) |
Net asset value, end of period | $ 1.00 | $ 1.00 | $ 1.00 | $ 1.00 | $ 1.00 |
Total Return (%) | .88 | 1.40 | 3.06 | 6.28 | 5.24 |
Ratios to Average Net Assets and Supplemental Data | |||||
Net assets, end of period ($ in thousands) | 394,967 | 544,146 | 750,110 | 671,539 | 637,767 |
Ratio of expenses (%) | .30 | .38 | .36 | .34 | .34 |
Ratio of net investment income (%) | .88 | 1.42 | 3.01 | 6.01 | 5.18 |
a Prior to July 31, 2003, the Prime Shares were known as the Deutsche Bank Alex. Brown Cash Reserve Prime Shares. b Prior to July 31, 2003, the Prime Institutional Shares were known as the Deutsche Bank Alex. Brown Cash Reserve Prime Institutional Shares. |
Treasury Sharesa | |||||
Years Ended March 31, | 2004 | 2003 | 2002 | 2001 | 2000 |
Selected Per Share Data | |||||
Net asset value, beginning of period | $ 1.00 | $ 1.00 | $ 1.00 | $ 1.00 | $ 1.00 |
Net investment income | .0039 | .0098 | .0250 | .0539 | .0431 |
Less: Distributions from net investment income | (.0039) | (.0098) | (.0250) | (.0539) | (.0431) |
Net asset value, end of period | $ 1.00 | $ 1.00 | $ 1.00 | $ 1.00 | $ 1.00 |
Total Return (%)c | .40 | .99 | 2.53 | 5.53 | 4.40 |
Ratios to Average Net Assets and Supplemental Data | |||||
Net assets, end of period ($ in thousands) | 376,821 | 390,982 | 745,638 | 866,508 | 790,443 |
Ratio of expenses before expense reductions (%) | .68 | .67 | .64 | .61 | .66 |
Ratio of expenses after expense reductions (%) | .63 | .62 | .59 | .56 | .61 |
Ratio of net investment income (%) | .39 | 1.01 | 2.47 | 5.36 | 4.31 |
Treasury Institutional Sharesb | |||||
Years Ended March 31, | 2004 | 2003 | 2002 | 2001 | 2000 |
Selected Per Share Data | |||||
Net asset value, beginning of period | $ 1.00 | $ 1.00 | $ 1.00 | $ 1.00 | $ 1.00 |
Net investment income | .0077 | .0130 | .0281 | .0571 | .0462 |
Less: Distributions from net investment income | (.0077) | (.0130) | (.0281) | (.0571) | (.0462) |
Net asset value, end of period | $ 1.00 | $ 1.00 | $ 1.00 | $ 1.00 | $ 1.00 |
Total Return (%)c | .78 | 1.31 | 2.85 | 5.86 | 4.72 |
Ratios to Average Net Assets and Supplemental Data | |||||
Net assets, end of period ($ in thousands) | 99,337 | 139,460 | 199,932 | 137,520 | 98,668 |
Ratio of expenses before expense reductions (%) | .29 | .35 | .33 | .31 | .34 |
Ratio of expenses after expense reductions (%) | .24 | .30 | .28 | .26 | .29 |
Ratio of net investment income (%) | .78 | 1.33 | 2.71 | 5.66 | 4.62 |
a Prior to July 31, 2003, the Treasury Shares were known as the Deutsche Bank Alex. Brown Cash Reserve Treasury Shares. b Prior to July 31, 2003, the Treasury Institutional Shares were known as the Deutsche Bank Alex. Brown Cash Reserve Treasury Institutional Shares. c Total return would have been lower had certain expenses not been reduced. |
Tax-Free Sharesa | |||||
Years Ended March 31, | 2004 | 2003 | 2002 | 2001 | 2000 |
Selected Per Share Data | |||||
Net asset value, beginning of period | $ 1.00 | $ 1.00 | $ 1.00 | $ 1.00 | $ 1.00 |
Net investment income | .0031 | .0074 | .0168 | .0333 | .0276 |
Less: Distributions from net investment income | (.0031) | (.0074) | (.0168) | (.0333) | (.0276) |
Net asset value, end of period | $ 1.00 | $ 1.00 | $ 1.00 | $ 1.00 | $ 1.00 |
Total Return (%) | .32 | .74 | 1.69 | 3.38 | 2.80 |
Ratios to Average Net Assets and Supplemental Data | |||||
Net assets, end of period ($ in thousands) | 650,986 | 699,983 | 1,006,613 | 1,701,940 | 1,664,370 |
Ratio of expenses (%) | .70 | .67 | .65 | .64 | .65 |
Ratio of net investment income (%) | .34 | .74 | 1.76 | 3.31 | 2.78 |
Tax-Free Institutional Sharesb | |||||
Years Ended March 31, | 2004 | 2003 | 2002 | 2001 | 2000 |
Selected Per Share Data | |||||
Net asset value, beginning of period | $ 1.00 | $ 1.00 | $ 1.00 | $ 1.00 | $ 1.00 |
Net investment income | .0070 | .0107 | .0200 | .0363 | .0306 |
Less: Distributions from net investment income | (.0070) | (.0107) | (.0200) | (.0363) | (.0306) |
Net asset value, end of period | $ 1.00 | $ 1.00 | $ 1.00 | $ 1.00 | $ 1.00 |
Total Return (%) | .70 | 1.07 | 2.01 | 3.69 | 3.10 |
Ratios to Average Net Assets and Supplemental Data | |||||
Net assets, end of period ($ in thousands) | 319,888 | 198,148 | 168,137 | 173,956 | 117,446 |
Ratio of expenses (%) | .32 | .35 | .33 | .34 | .35 |
Ratio of net investment income (%) | .72 | 1.06 | 1.98 | 3.62 | 3.09 |
a Prior to July 31, 2003, the Tax-Free Shares were known as the Deutsche Bank Alex. Brown Cash Reserve Tax-Free Shares. b Prior to July 31, 2003, the Tax-Free Institutional Shares were known as the Deutsche Bank Alex. Brown Cash Reserve Tax-Free Institutional Shares. |
Note 1-Organization and Significant Accounting Policies
A. Organization
Cash Reserve Fund, Inc. (formerly Deutsche Bank Alex. Brown Cash Reserve Fund, Inc.) (the `Fund') is registered under the Investment Company Act of 1940 (the `Act'), as amended, as a diversified, open-end management investment company. The Fund is organized as a corporation under the laws of the state of Maryland. The Prime Series, the Treasury Series and the Tax-Free Series (the "Series") are the three series the Fund offers to investors.
The Prime Series offers six classes of shares to investors: Cash Reserve Prime Shares (`Prime Shares'), Scudder Cash Reserve Prime Class A Shares (`Class A Shares'), Scudder Cash Reserve Prime Class B Shares (`Class B Shares'), Scudder Cash Reserve Prime Class C Shares (`Class C Shares'), Quality Cash Reserve Prime Shares (`Quality Cash Shares') and Cash Reserve Prime Institutional Shares (`Prime Institutional Shares'). Certain detailed information for the Class A Shares, Class B Shares, Class C Shares and Quality Cash Shares is provided separately and is available upon request.
The Treasury Series offers two classes of shares to investors: Cash Reserve Treasury Shares (`Treasury Shares') and Cash Reserve Treasury Institutional Shares (`Treasury Institutional Shares').
The Tax-Free Series offers two classes of shares to investors: Cash Reserve Tax-Free Shares (`Tax-Free Shares') and Cash Reserve Tax-Free Institutional Shares (`Tax-Free Institutional Shares').
All shares have equal rights with respect to voting except that shareholders vote separately on matters affecting their rights as holders of a particular series or class.
The investment objective of each Series is as follows: Prime Series and Treasury Series-to seek as high a level of current income as is consistent with preservation of capital and liquidity; Tax-Free Series-to seek as high a level of current income exempt from federal income tax as is consistent with preservation of capital and liquidity. Details concerning the Series' investment objectives and policies and the risk factors associated with the Series' investments are described in the Series' Prospectus and Statement of Additional Information.
B. Valuation of Securities
Portfolio securities are valued utilizing the amortized cost method permitted in accordance with Rule 2a-7 under the Act and certain conditions therein. Under this method, which does not take into account unrealized capital gains or losses on securities, an instrument is initially valued at its cost and thereafter assumes a constant accretion/amortization to maturity of any discount or premium.
C. Securities Transactions and Investment Income
Securities transactions are recorded on trade date. Realized gains and losses are determined by comparing the proceeds of a sale or the cost of a purchase with a specific offsetting transaction.
Interest income, including amortization of premiums and accretion of discounts, is accrued daily. Dividend income is recorded on the ex-dividend date. Estimated expenses are also accrued daily.
Distribution or service fees and transfer agent fees specifically attributable to a class are allocated to that class. All other expenses, income, gains and losses are allocated among the classes based upon their relative net assets.
D. Distributions
The Fund distributes its net investment income in the form of dividends, which are declared and recorded daily. Accumulated daily dividends are distributed to shareholders monthly.
E. Federal Income Taxes
It is the Fund's policy to continue to qualify as a regulated investment company under the Internal Revenue Code and to distribute substantially all of its taxable income to shareholders. Therefore, no federal income taxes have been accrued.
F. Repurchase Agreements
The Prime Series and Treasury Series may make short term investments in repurchase agreements that are fully collateralized by US government securities and agencies. Under the terms of a repurchase agreement, a financial institution sells fixed income securities to the Series and agrees to buy them back on a specified day in return for the principal amount of the original sale plus accrued interest. The custodial bank holds the collateral in a separate account until the agreement matures. If the value of the securities falls below the principal amount of the repurchase agreement plus accrued interest, the financial institution deposits additional collateral by the following business day. If the financial institution either fails to deposit the required additional collateral or fails to repurchase the securities as agreed, the Series has the right to sell the securities and recover any resulting loss from the financial institution. If the financial institution enters into bankruptcy, the Series' claims on the collateral may be subject to legal proceedings.
G. Expenses
Expenses of the Fund arising in connection with a specific Series are allocated to that Series. Other Fund expenses which cannot be directly attributed to a Series are apportioned among the Series in the Fund.
H. Estimates
In preparing its financial statements in conformity with accounting principles generally accepted in the United States, management makes estimates and assumptions. Actual results may be different.
Note 2-Fees and Transactions with Affiliates
Investment Company Capital Corp. (`ICCC'), an indirect, wholly owned subsidiary of Deutsche Bank AG, is the Advisor for each Series. The Fund pays the Advisor an annual fee based on its aggregate average daily net assets which is calculated daily and paid monthly at the following annual rates: 0.30% of the first $500 million, 0.26% of the next $500 million, 0.25% of the next $500 million, 0.24% of the next $1 billion, 0.23% of the next $1 billion and 0.22% of the amount in excess of $3.5 billion.
In addition, the Advisor is entitled to receive an additional fee with respect to the Prime Series and the Tax-Free Series, calculated daily and payable monthly, at the annual rate of 0.02% of the Prime Series' average daily net assets and 0.03% of the Tax-Free Series' average daily net assets.
Accordingly, for the year ended March 31, 2004, the fee pursuant to the management agreement was equivalent to an annual effective rate of 0.24%, 0.26% and 0.27% of the average daily net assets of the Treasury Series, Prime Series and Tax-Free Series, respectively.
For the period April 1, 2003 through August 1, 2003, the Advisor contractually agreed to a fee waiver equal to 0.05% of the average net assets on the Treasury Series. For the period August 1, 2003 through March 31, 2004, the Advisor agreed to voluntarily continue the fee waiver of 0.05% of average net assets on the Treasury Series. Accordingly, for the year ended March 31, 2004, the Advisor waived $249,063 of operating expenses for the Treasury Series.
In addition, the Advisor has agreed to voluntarily waive expenses as necessary to maintain a positive yield. This waiver may be changed or terminated at any time without notice. Under these arrangements, the Advisor waived expenses on Class A, B and C shares of the Prime Series.
During the year ended March 31, 2004, ICCC was the Fund's accounting agent. Each Series paid the accounting agent a fixed fee of $13,000 on assets up to $10 million. On assets greater than $10 million, each Series paid the accounting agent an annual fee based on its average daily net assets which was calculated daily and paid monthly. Scudder Fund Accounting Corporation (`SFAC'), an affiliate of the Advisor, is responsible for the general accounting records and determining the daily net asset value per share of the Fund. SFAC has retained State Street Bank and Trust Company (`State Street') as a sub-agent that performs fund accounting and administration services.
Scudder Investments Service Company (`SISC'), an affiliate of the Advisor, is the Fund's transfer agent. Each class paid the transfer agent a per account fee that is accrued daily and paid monthly. For the year ended March 31, 2004, the amount charged to the Fund by SISC was as follows:
Total Aggregated | Transfer Agent Fees Waived | |
Prime Series: Prime Shares | $ 1,558,672 | $ - |
Prime Institutional Shares | 49,928 | - |
Class A Shares | 22,495 | 11 |
Class B Shares | 27,933 | 27,933 |
Class C Shares | 562 | 562 |
Quality Shares | 3,282 | - |
Treasury Series: Treasury Shares | $ 215,877 | $ - |
Treasury Institutional Shares | 4,904 | - |
Tax-Free Series: Tax-Free Shares | $ 479,032 | $ - |
Tax-Free Institutional Shares | 16,848 | - |
Pursuant to a sub-transfer agency agreement between SISC and DST Systems, Inc. (`DST'), SISC has delegated certain transfer agent and dividend paying agent functions to DST. The cost and expenses of such delegations are borne by SISC, not by the Fund.
Effective April 11, 2003, State Street serves as custodian for the Fund. Prior to April 11, 2003, Deutsche Bank Trust Company Americas, an affiliate of ICCC, was the Fund's custodian. The Fund pays the custodian an annual fee, which is accrued daily and payable monthly.
As compensation for his or her services, each Independent Director receives an aggregate annual fee, plus a fee for each meeting attended (plus reimbursement for reasonable out-of-pocket expenses incurred in connection with his or her attendance at board and committee meetings) from each Fund in the Fund Complex for which he or she serves. In addition, the Chairman of the Fund Complex's Audit Committee receives an annual fee for his services.
Note 3-Distribution and Service Fees
Scudder Distributors, Inc. (`SDI') is the Fund's Distributor. Each Series pays the Distributor an annual fee, pursuant to Rule 12b-1, based on its average daily net assets, which is calculated daily and paid monthly at the following annual rates: 0.25% of the Prime Shares, Class A Shares, Treasury Shares and Tax-Free Shares average daily net assets, 0.60% of the Quality Cash Shares average daily net assets and 0.75% of the Class B Shares and Class C Shares average daily net assets. The Fund does not pay fees on the Prime Institutional Shares, Treasury Institutional Shares and Tax-Free Institutional Shares. For the year ended March 31, 2004, the Distribution Fee was as follows:
Total Aggregated | Unpaid at March 31, 2004 | |
Prime Series: Prime Shares | $ 6,984,412 | $ 576,847 |
Class A Shares | 17,296 | 1,081 |
Class B Shares | 55,175 | 2,826 |
Class C Shares | 1,672 | 81 |
Quality Shares | 19,175 | 1,759 |
Treasury Series: Treasury Shares | $ 991,851 | $ 81,711 |
Tax-Free Series: Tax-Free Shares | $ 1,757,550 | $ 175,980 |
Each Series pays the Distributor a shareholder servicing fee based on the average daily net assets which is calculated daily and paid monthly at the following rates of 0.07% of Prime Shares, Treasury Shares and Tax-Free Shares, and 0.25% of Class B and Class C Shares. The Distributor uses this fee to compensate third parties that provide shareholder services to their clients who own shares. For the year ended March 31, 2004, the shareholder servicing fee was as follows:
Total Aggregated | Shareholder Servicing Fee Waived | Unpaid at March 31, | |
Prime Series: Prime Shares | $ 1,955,635 | $ - | $ 162,436 |
Class B Shares | 18,392 | 12,178 | - |
Class C Shares | 558 | 366 | - |
Treasury Series: Treasury Shares | $ 277,718 | $ - | $ 23,470 |
Tax-Free Series: Tax-Free Shares | $ 492,113 | $ - | $ 43,911 |
Note 4-Expense Off-Set Arrangement
The Fund has entered into an arrangement with its custodian whereby credits realized as a result of uninvested cash balances were used to reduce a portion of the Fund's custodian expenses. During the year ended March 31, 2004, the Fund's custodian fees were reduced by $2,291, $251 and $488 for the Prime Series, the Treasury Series, and the Tax-Free Series, respectively, under this arrangement.
Note 5-Share Transactions
The Fund is authorized to issue up to 20.81 billion shares of $.001 par value capital stock (12.66 billion Prime Series, 3.55 billion Treasury Series, 4.25 billion Tax-Free Series and 350 million undesignated). Transactions in capital stock were as follows (at net asset value of $1.00 per share):
Prime Series: | Year Ended | Year Ended | ||
Shares | Dollars | Shares | Dollars | |
Sold: | ||||
Prime Shares | 2,192,158,383 | $ 2,192,158,382 | 12,024,358,045 | $ 12,024,358,044 |
Prime Institutional Shares | 1,585,368,740 | 1,585,368,740 | 5,825,254,848 | 5,825,254,848 |
Class A Shares | 491,136 | 491,136 | 125,429,162 | 125,429,092 |
Class B Shares | 19,023 | 19,023 | 10,936,596 | 10,936,597 |
Class C Shares | - | - | 402,461 | 402,462 |
Quality Cash Shares | 440,980 | 440,980 | 107,544,397 | 107,544,146 |
$ 3,778,478,261 | $ 18,093,925,189 | |||
Reinvested: | ||||
Prime Shares | 13,937,204 | $ 13,937,204 | 36,581,377 | $ 36,581,378 |
Prime Institutional Shares | 4,144,719 | 4,144,719 | 8,460,923 | 8,460,923 |
Class A Shares | 27,001 | 27,001 | 132,199 | 132,199 |
Class B Shares | 5,327 | 5,327 | 49,958 | 49,957 |
Class C Shares | 155 | 155 | 1,934 | 1,934 |
Quality Cash Shares | 5,380 | 5,380 | 203,025 | 203,025 |
$ 18,119,786 | $ 45,429,416 | |||
Redeemed: | ||||
Prime Shares | (2,419,926,242) | $ (2,419,925,662) | (13,502,262,846) | $ (13,502,262,742) |
Prime Institutional Shares | (1,738,713,361) | (1,738,713,361) | (6,039,643,782) | (6,039,643,782) |
Class A Shares | (4,558,264) | (4,558,264) | (128,282,478) | (128,282,478) |
Class B Shares | (6,331,370) | (6,331,370) | (10,853,181) | (10,850,194) |
Class C Shares | (236,381) | (236,381) | (708,506) | (708,510) |
Quality Cash Shares | (269,377) | (269,377) | (140,267,822) | (140,267,822) |
$ (4,170,034,415) | $ (19,822,015,528) | |||
Net Decrease: | ||||
(373,436,947) | $ (373,436,368) | (1,682,663,690) | $ (1,682,660,923) |
Year Ended | Year Ended | |||
Treasury Series: | Shares | Dollars | Shares | Dollars |
Sold: | ||||
Treasury Shares | 647,805,963 | $ 647,805,963 | 1,887,082,754 | $ 1,887,082,721 |
Treasury Institutional Shares | 170,442,236 | 170,442,236 | 582,289,746 | 582,289,746 |
$ 818,248,199 | $ 2,469,372,467 | |||
Reinvested: | ||||
Treasury Shares | 1,554,168 | $ 1,554,168 | 5,494,804 | $ 5,494,804 |
Treasury Institutional Shares | 801,414 | 801,414 | 1,456,032 | 1,456,032 |
$ 2,355,582 | $ 6,950,836 | |||
Redeemed: | ||||
Treasury Shares | (663,529,340) | $ (663,529,340) | (2,247,103,538) | $ (2,247,103,537) |
Treasury Institutional Shares | (211,376,180) | (211,376,180) | (644,185,152) | (644,185,152) |
$ (874,905,520) | $ (2,891,288,689) | |||
Net decrease: | ||||
(54,301,739) | $ (54,301,739) | (414,965,354) | $ (414,965,386) |
Tax-Free Series: | Year Ended | Year Ended | ||
Shares | Dollars | Shares | Dollars | |
Sold: | ||||
Tax-Free Shares | 987,484,261 | $ 987,484,259 | 2,775,518,182 | $ 2,775,518,182 |
Tax-Free Institutional Shares | 485,464,418 | 485,464,418 | 1,303,707,175 | 1,303,707,176 |
$ 1,472,948,677 | $ 4,079,225,358 | |||
Reinvested: | ||||
Tax-Free Shares | 2,208,926 | $ 2,208,926 | 5,870,979 | $ 5,870,979 |
Tax-Free Institutional Shares | 1,599,226 | 1,599,226 | 1,342,993 | 1,342,993 |
$ 3,808,152 | $ 7,213,972 | |||
Redeemed: | ||||
Tax-Free Shares | (1,038,868,940) | $ (1,038,868,940) | (3,088,026,833) | $ (3,088,026,833) |
Tax-Free Institutional Shares | (365,361,922) | (365,361,922) | (1,275,033,768) | (1,275,033,768) |
$ (1,404,230,862) | $ (4,363,060,601) | |||
Net increase/(decrease): | ||||
72,525,969 | $ 72,525,967 | (276,621,272) | $ (276,621,271) |
Note 6-Tax Disclosures
The timing and characterization of certain income and capital gains distributions are determined annually in accordance with federal tax regulations which may differ from accounting principles generally accepted in the United States of America. These differences primarily relate to distribution reclassifications. As a result, net investment income (loss) and net realized gain (loss) on investment transactions for a reporting period may differ significantly from distributions during such period. Accordingly, the Fund may periodically make reclassifications among certain of its capital accounts without impacting the net asset value of the Fund.
Distributions were characterized as follows for tax purposes:
Years Ended | March 31, 2004 | March 31, 2003 |
Prime Series Ordinary income* | $ 18,122,285 | $ 48,127,272 |
Treasury Series Ordinary income* | $ 2,368,411 | $ 7,781,351 |
Tax-Free Series Tax exempt income | $ 3,808,322 | $ 8,201,103 |
At March 31, 2004, the components of distributable earnings on a tax basis were as follows:
Prime Series Undistributed ordinary income* | $ 1,388,017 |
Treasury Series Undistributed ordinary income* | $ 297,892 |
Tax-Free Series Undistributed tax exempt income | $ 326,371 |
Tax-Free Series Capital loss carryforward | $ (41,000) |
Tax-Free Series Unrealized appreciation (depreciation) on investments | $ (1,664) |
* For tax purposes, short-term capital gains distributions are considered ordinary income distributions.
At March 31, 2004, the Tax-Free Series had a net tax basis capital loss carryforward of approximately $41,000 which may be applied against any realized net taxable capital gains of each succeeding year until fully utilized or until March 31, 2008 ($21,000) and March 31, 2009 ($20,000), the respective expiration dates, whichever occurs first.
Note 7-Regulatory Matters and Litigation
Since at least July 2003, federal, state and industry regulators have been conducting ongoing inquiries and investigations ("inquiries") into the mutual fund industry, and have requested information from numerous mutual fund companies, including Scudder Investments. We are unable to determine what the outcome of these inquiries will be or what the effect, if any, would be on the funds or their advisers. Publicity about mutual fund practices arising from these industry wide inquiries serves as the general basis of a number of private lawsuits against the Scudder Funds. These lawsuits, which previously have been reported in the press, involve purported class action and derivative lawsuits, making various allegations and naming as defendants various persons, including certain Scudder funds, Deutsche Asset Management ("DeAM") and its affiliates, certain individuals, including in some cases Fund Trustees/Directors, and other parties. DeAM has undertaken to bear all liabilities and expenses incurred by the Scudder funds in connection with these lawsuits, or other lawsuits or regulatory actions that may be filed making allegations similar to these lawsuits regarding fund valuation, market timing, revenue sharing or other subjects of the pending inquiries. Based on currently available information, DeAM believes the likelihood that the pending lawsuits will have a material adverse financial impact on a Scudder fund is remote and such actions are not likely to materially affect its ability to perform under its investment management agreements with the Scudder funds.
To the Board of Directors of Cash Reserve Fund, Inc. (formerly Deutsche Bank Alex. Brown Cash Reserve Fund, Inc.) and Shareholders of the Prime, Treasury and Tax-Free Series:
In our opinion, the accompanying statements of assets and liabilities, including the schedules of investments, and the related statements of operations and of changes in net assets and the financial highlights included herein present fairly, in all material respects, the financial position of the Prime, Treasury and Tax-Free Series (the three series constituting the Cash Reserve Fund, Inc. hereafter referred to as the "Series") at March 31, 2004, and the results of each of their operations, the changes in each of their net assets and the financial highlights of the classes presented for each of the periods indicated, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the Series' management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements 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 are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at March 31, 2004 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.
PricewaterhouseCoopers LLP
Boston, Massachusetts
May 27, 2004
Tax-Free Series
Of the dividends paid from net investment income for the taxable year ended March 31, 2004, 100% are designated as exempt interest dividends for federal income tax purposes.
Proxy Voting
A description of the fund's policies and procedures for voting proxies for portfolio securities can be found on our Web site - - scudder.com (type "proxy voting" in the search field) - or on the SEC's Web site - www.sec.gov. To obtain a written copy without charge, call us toll free at (800) 621-1048.
Independent Directors | ||
Name, Date of Birth, Position with the Fund and Length of Time Served1 | Business Experience and Directorships During the Past 5 Years | Number of Funds in the Fund Complex Overseen |
Richard R. Burt 2/3/47 Director since 1999 | Chairman, Diligence LLC (international information-collection and risk-management firm) (September 2002 to present); Chairman, IEP Advisors, Inc. (July 1998 to present); Chairman of the Board, Weirton Steel Corporation2 (April 1996 to present); Member of the Board, Hollinger International, Inc.2 (publishing) (September 1995 to present), HCL Technologies Limited (information technology) (April 1999 to present), UBS Mutual Funds (formerly known as Brinson and Mitchell Hutchins families of funds) (registered investment companies) (September 1995 to present); and Member, Textron Inc.2 International Advisory Council (July 1996 to present). Formerly, Partner, McKinsey & Company (consulting) (1991-1994) and US Chief Negotiator in Strategic Arms Reduction Talks (START) with former Soviet Union and US Ambassador to the Federal Republic of Germany (1985-1991); Member of the Board, Homestake Mining2 (mining and exploration) (1998-February 2001), Archer Daniels Midland Company2 (agribusiness operations) (October 1996-June 2001) and Anchor Gaming (gaming software and equipment) (March 1999-December 2001). | 68 |
S. Leland Dill 3/28/30 Director since 2002 | Trustee, Phoenix Zweig Series Trust (since September 1989), Phoenix Euclid Market Neutral Funds (since May 1998) (registered investment companies); Retired (since 1986). Formerly, Partner, KPMG Peat Marwick (June 1956-June 1986); Director, Vintners International Company Inc. (wine vintner) (June 1989-May 1992); Coutts (USA) International (January 1992-March 2000), Coutts Trust Holdings Ltd., Coutts Group (private bank) (March 1991-March 1999); General Partner, Pemco (investment company) (June 1979-June 1986). | 66 |
Martin J. Gruber 7/15/37 Director since 2002 | Nomura Professor of Finance, Leonard N. Stern School of Business, New York University (since September 1964); Trustee, CREF (pension fund) (since January 2000); Director, Japan Equity Fund, Inc. (since January 1992), Thai Capital Fund, Inc. (since January 2000) and Singapore Fund, Inc. (since January 2000) (registered investment companies). Formerly, Trustee, TIAA (pension fund) (January 1996-January 2000). | 66 |
Joseph R. Hardiman 5/27/37 Director since 1998 | Private Equity Investor (January 1997 to present); Director, Corvis Corporation2 (optical networking equipment) (July 2000 to present), Brown Investment Advisory & Trust Company (investment advisor) (February 2001 to present), The Nevis Fund (registered investment company) (July 1999 to present), and ISI Family of Funds (registered investment companies) (March 1998 to present). Formerly, Director, Circon Corp.2 (medical instruments) (November 1998-January 1999); President and Chief Executive Officer, The National Association of Securities Dealers, Inc. and The NASDAQ Stock Market, Inc. (1987-1997); Chief Operating Officer of Alex. Brown & Sons Incorporated (now Deutsche Bank Securities Inc.) (1985-1987); General Partner, Alex. Brown & Sons Incorporated (now Deutsche Bank Securities Inc.) (1976-1985). | 66 |
Richard J. Herring 2/18/46 Director since 2002 | Jacob Safra Professor of International Banking and Professor, Finance Department, The Wharton School, University of Pennsylvania (since July 1972); Director, Lauder Institute of International Management Studies (since July 2000); Co-Director, Wharton Financial Institutions Center (since July 2000). Formerly, Vice Dean and Director, Wharton Undergraduate Division (July 1995-June 2000). | 66 |
Graham E. Jones 1/31/33 Director since 2002 | Senior Vice President, BGK Realty, Inc. (commercial real estate) (since 1995); Trustee, 8 open-end mutual funds managed by Weiss, Peck & Greer (since 1985) and Trustee of 18 open-end mutual funds managed by Sun Capital Advisers, Inc. (since 1998). | 66 |
Rebecca W. Rimel 4/10/51 Director since 1995 | President and Chief Executive Officer, The Pew Charitable Trusts (charitable foundation) (1994 to present); Executive Vice President, The Glenmede Trust Company (investment trust and wealth management) (1983 to present). | 66 |
Philip Saunders, Jr. 10/11/35 Director since 2002 | Principal, Philip Saunders Associates (economic and financial consulting) (since November 1988). Formerly, Director, Financial Industry Consulting, Wolf & Company (consulting) (1987-1988); President, John Hancock Home Mortgage Corporation (1984-1986); Senior Vice President of Treasury and Financial Services, John Hancock Mutual Life Insurance Company, Inc. (1982-1986). | 66 |
William N. Searcy 9/03/46 Director since 2002 | Private investor (since October 2003); Trustee of 18 open-end mutual funds managed by Sun Capital Advisers, Inc. (since October 1998). Formerly, Pension & Savings Trust Officer, Sprint Corporation2 (telecommunications) (November 1989 to October 2003). | 66 |
Robert H. Wadsworth 1/29/40 Director since 1999 | President, Robert H. Wadsworth Associates, Inc. (consulting firm) (May 1983 to present). Formerly, President and Trustee, Trust for Investment Managers (registered investment company) (April 1999-June 2002); President, Investment Company Administration, L.L.C. (January 1992*-July 2001); President, Treasurer and Director, First Fund Distributors, Inc. (June 1990-January 2002); Vice President, Professionally Managed Portfolios (May 1991-January 2002) and Advisors Series Trust (October 1996-January 2002) (registered investment companies). * Inception date of the corporation which was the predecessor to the L.L.C. | 69 |
Interested Director | ||
Name, Date of Birth, Position with the Fund and Length of Time Served1 | Business Experience and Directorships During the Past 5 Years | Number of Funds in the Fund Complex Overseen |
Richard T. Hale3 7/17/45 Chairman since 2002 and Director since 1989 | Managing Director, Deutsche Investment Management Americas Inc. (2003-present); Managing Director, Deutsche Bank Securities Inc. (formerly Deutsche Banc Alex. Brown Inc.) and Deutsche Asset Management (1999 to present); Director and President, Investment Company Capital Corp. (registered investment advisor) (1996 to present); Director, Deutsche Global Funds, Ltd. (2000 to present) (registered investment company); Director, Scudder Global Opportunities Funds (since 2003); Director/Officer Deutsche/Scudder Mutual Funds (various dates); President, Montgomery Street Income Securities, Inc. (2002 to present) (registered investment companies); Vice President, Deutsche Asset Management, Inc. (2000 to present). Formerly, Director, CABEI Fund (2000 to 2004), North American Income Fund (2000 to 2004) (registered investment companies), ISI Family of Funds (registered investment companies; 4 funds overseen) (1992-1999). | 202 |
Officers | |
Name, Date of Birth, Position with the Fund and Length of Time Served1 | Business Experience and Directorships During the Past 5 Years |
Richard T. Hale3 7/17/45 Chief Executive Officer since 2003 | See information presented under Interested Director. |
Brenda Lyons4 2/21/63 President since 2003 | Managing Director, Deutsche Asset Management |
Kenneth Murphy4 10/13/63 Vice President and Anti-Money Laundering Compliance Officer since 2002 | Vice President, Deutsche Asset Management (September 2000-present). Formerly, Director, John Hancock Signature Services (1992-2000). |
Bruce A. Rosenblum 9/14/60 Vice President since 2003 Assistant Secretary since 2002 | Director, Deutsche Asset Management. |
Charles A. Rizzo4 8/5/57 Treasurer and Chief Financial Officer since 2002 | Managing Director, Deutsche Asset Management (April 2000 to present); Formerly, Vice President and Department Head, BT Alex. Brown Incorporated (now Deutsche Bank Securities Inc.) (1998-1999); Senior Manager, Coopers & Lybrand L.L.P. (now PricewaterhouseCoopers LLP) (1993-1998). |
Salvatore Schiavone4 11/03/65 Assistant Treasurer since 2003 | Director, Deutsche Asset Management. |
Lucinda H. Stebbins4 11/19/45 Assistant Treasurer since 2003 | Director, Deutsche Asset Management. |
Name, Date of Birth, Position with the Fund and Length of Time Served1 | Business Experience and Directorships During the Past 5 Years |
Kathleen Sullivan D'Eramo4 1/25/57 Assistant Treasurer since 2003 | Director, Deutsche Asset Management. |
John Millette4 8/23/62 Secretary since 2003 | Director, Deutsche Asset Management. |
Daniel O. Hirsch 3/27/54 Assistant Secretary since 2003 | Managing Director, Deutsche Asset Management (2002-present) and Director, Deutsche Global Funds Ltd. (2002-present). Formerly, Director, Deutsche Asset Management (1999-2002); Principal, BT Alex. Brown Incorporated (now Deutsche Bank Securities Inc.) (1998-1999); Assistant General Counsel, United States Securities and Exchange Commission (1993-1998). |
Caroline Pearson4 4/01/62 Assistant Secretary since 2002 | Managing Director, Deutsche Asset Management. |
1 Unless otherwise indicated, the mailing address of each Director and Officer with respect to fund operations is One South Street, Baltimore, MD 21202.
2 A publicly held company with securities registered pursuant to Section 12 of the Securities Exchange Act of 1934.
3 Mr. Hale is a Director who is an "interested person" within the meaning of Section 2(a)(19) of the 1940 Act. Mr. Hale is President of Investment Company Capital Corp., Vice President of Deutsche Asset Management, Inc. and a Managing Director of Deutsche Asset Management, the US asset management unit of Deutsche Bank AG and its affiliates.
4 Address: Two International Place, Boston, Massachusetts.
The fund's Statement of Additional Information includes additional information about the fund's Directors. To receive your free copy of the Statement of Additional Information, call toll-free: 1-800-730-1313.
Notes |
Notes |
Notes |
Notes |
the six-month period ended September 30, 2002, and offer an outlook for the months ahead.
ITEM 2. CODE OF ETHICS. As of the end of the period, March 31, 2004, Cash Reserve Fund, Inc. has adopted a code of ethics, as defined in Item 2 of Form N-CSR, that applies to its President and Treasurer and its Chief Financial Officer. A copy of the code of ethics is filed as an exhibit to this Form N-CSR. ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT. The Fund's Board of Directors/Trustees has determined that the Fund has at least one "audit committee financial expert" serving on its audit committee: Mr. S. Leland Dill. This audit committee member is "independent," meaning that he is not an "interested person" of the Fund (as that term is defined in Section 2(a)(19) of the Investment Company Act of 1940) and he does not accept any consulting, advisory, or other compensatory fee from the Fund (except in the capacity as a Board or committee member). An "audit committee financial expert" is not an "expert" for any purpose, including for purposes of Section 11 of the Securities Act of 1933, as a result of being designated as an "audit committee financial expert." Further, the designation of a person as an "audit committee financial expert" does not mean that the person has any greater duties, obligations, or liability than those imposed on the person without the "audit committee financial expert" designation. Similarly, the designation of a person as an "audit committee financial expert" does not affect the duties, obligations, or liability of any other member of the audit committee or board of directors. ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES. CASH RESERVE FUND, INC. - PRIME SERIES FORM N-CSR DISCLOSURE RE: AUDIT FEES The following table shows the amount of fees that PricewaterhouseCoopers, LLP ("PWC"), the Fund's auditor, billed to the Fund during the Fund's last two fiscal years. For engagements with PWC entered into on or after May 6, 2003, the Audit Committee approved in advance all audit services and non-audit services that PWC provided to the Fund. The Audit Committee has delegated certain pre-approval responsibilities to its Chairman (or, in his absence, any other member of the Audit Committee). Services that the Fund's Auditor Billed to the Fund - -------------------------------------------------------------------------------- Fiscal Year Audit Audit-Related Tax Fees All Other Ended Fees Billed Fees Billed Billed to Fees Billed March 31 to Fund to Fund Fund to Fund - -------------------------------------------------------------------------------- 2004 $38,300 $2,029 $3,100 $0 - -------------------------------------------------------------------------------- 2003 $28,177 $722 $2,925 $0 - -------------------------------------------------------------------------------- The above "Tax Fees" were billed for professional services rendered for tax compliance. Services that the Fund's Auditor Billed to the Adviser and Affiliated Fund Service Providers The following table shows the amount of fees billed by PWC to investment Company Capital Corp. ("ICCC" or the "Adviser"), and any entity controlling, controlled by or under common control with ICCC ("Control Affiliate") that provides ongoing services to the Fund ("Affiliated Fund Service Provider"), for engagements directly related to the Fund's operations and financial reporting, during the Fund's last two fiscal years. - -------------------------------------------------------------------------------- Audit-Related All Fees Billed to Tax Fees Billed to Other Fees Billed Fiscal Year Adviser and Adviser and to Adviser and Ended Affiliated Fund Affiliated Fund Affiliated Fund March 31 Service Providers Service Providers Service Providers - -------------------------------------------------------------------------------- 2004 $573,742 $0 $0 - -------------------------------------------------------------------------------- 2003 $452,700 $69,500 $34,400 - -------------------------------------------------------------------------------- The "Audit-Related Fees" were billed for services in connection with the assessment of internal controls, agreed-upon procedures and additional related procedures.Non-Audit Services The following table shows the amount of fees that PWC billed during the Fund's last two fiscal years for non-audit services. For engagements entered into on or after May 6, 2003, the Audit Committee pre-approved all non-audit services that PWC provided to the Adviser and any Affiliated Fund Service Provider that related directly to the Fund's operations and financial reporting. The Audit Committee requested and received information from PWC about any non-audit services that PWC rendered during the Fund's last fiscal year to the Adviser and any Affiliated Fund Service Provider. The Committee considered this information in evaluating PWC's independence. - -------------------------------------------------------------------------------- Total Non-Audit Fees billed to Adviser and Affiliated Fund Service Providers Total (engagements Non-Audit related Fees billed directly to Adviser to the and Affiliated Total operations Fund Service Non-Audit and financial Providers Fiscal Billed Fees reporting (all other Total of Year to Fund of the Fund) engagements) (A), (B Ended March 31 (A) (B) (C) and (C) - -------------------------------------------------------------------------------- 2004 $3,100 $0 $2,412,058 $2,415,158 - -------------------------------------------------------------------------------- 2003 $2,925 $103,900 $17,512,166 $17,618,991 - -------------------------------------------------------------------------------- All other engagement fees were billed for services in connection with risk management, tax services and process improvement/integration initiatives for ICCC and other related entities that provide support for the operations of the fund. CASH RESERVE FUND, INC. - TREASURY SERIES FORM N-CSR DISCLOSURE RE: AUDIT FEES The following table shows the amount of fees that PricewaterhouseCoopers, LLP ("PWC"), the Fund's auditor, billed to the Fund during the Fund's last two fiscal years. For engagements with PWC entered into on or after May 6, 2003, the Audit Committee approved in advance all audit services and non-audit services that PWC provided to the Fund. The Audit Committee has delegated certain pre-approval responsibilities to its Chairman (or, in his absence, any other member of the Audit Committee). Services that the Fund's Auditor Billed to the Fund - -------------------------------------------------------------------------------- Fiscal Year Audit Audit-Related Tax Fees All Other Ended Fees Billed Fees Billed Billed to Fees Billed March 31 to Fund to Fund Fund to Fund - -------------------------------------------------------------------------------- 2004 $34,800 $2,029 $3,100 $0 - -------------------------------------------------------------------------------- 2003 $25,177 $722 $2,925 $0 - -------------------------------------------------------------------------------- The above "Tax Fees" were billed for professional services rendered for tax compliance. Services that the Fund's Auditor Billed to the Adviser and Affiliated Fund Service Providers The following table shows the amount of fees billed by PWC to investment Company Capital Corp. ("ICCC" or the "Adviser"), and any entity controlling, controlled by or under common control with ICCC ("Control Affiliate") that provides ongoing services to the Fund ("Affiliated Fund Service Provider"), for engagements directly related to the Fund's operations and financial reporting, during the Fund's last two fiscal years. - -------------------------------------------------------------------------------- Audit-Related All Fees Billed to Tax Fees Billed to Other Fees Billed Fiscal Year Adviser and Adviser and to Adviser and Ended Affiliated Fund Affiliated Fund Affiliated Fund March 31 Service Providers Service Providers Service Providers - -------------------------------------------------------------------------------- 2004 $573,742 $0 $0 - -------------------------------------------------------------------------------- 2003 $452,700 $69,500 $34,400 - -------------------------------------------------------------------------------- The "Audit-Related Fees" were billed for services in connection with the assessment of internal controls, agreed-upon procedures and additional related procedures. Non-Audit Services The following table shows the amount of fees that PWC billed during the Fund's last two fiscal years for non-audit services. For engagements entered into on or after May 6, 2003, the Audit Committee pre-approved all non-audit services that PWC provided to the Adviser and any Affiliated Fund Service Provider that related directly to the Fund's operations and financial reporting. The Audit Committee requested and received information from PWC about any non-audit services that PWC rendered during the Fund's last fiscal year to the Adviser and any Affiliated Fund Service Provider. The Committee considered this information in evaluating PWC's independence. - -------------------------------------------------------------------------------- Total Non-Audit Fees billed to Adviser and Affiliated Fund Service Providers Total (engagements Non-Audit related Fees billed directly to Adviser to the and Affiliated Total operations Fund Service Non-Audit and financial Providers Fiscal Billed Fees reporting (all other Total of Year to Fund of the Fund) engagements) (A), (B) Ended March 31 (A) (B) (C) and (C) - -------------------------------------------------------------------------------- 2004 $3,100 $0 $2,412,058 $2,415,158 - -------------------------------------------------------------------------------- 2003 $2,925 $103,900 $17,512,166 $17,618,991 - -------------------------------------------------------------------------------- All other engagement fees were billed for services in connection with risk management, tax services and process improvement/integration initiatives for ICCC and other related entities that provide support for the operations of the fund. CASH RESERVE FUND, INC. - TAX FREE SERIES FORM N-CSR DISCLOSURE RE: AUDIT FEES The following table shows the amount of fees that PricewaterhouseCoopers, LLP ("PWC"), the Fund's auditor, billed to the Fund during the Fund's last two fiscal years. For engagements with PWC entered into on or after May 6, 2003, the Audit Committee approved in advance all audit services and non-audit services that PWC provided to the Fund. The Audit Committee has delegated certain pre-approval responsibilities to its Chairman (or, in his absence, any other member of the Audit Committee). Services that the Fund's Auditor Billed to the Fund - -------------------------------------------------------------------------------- Fiscal Year Audit Audit-Related Tax Fees All Other Ended Fees Billed Fees Billed Billed to Fees Billed March 31 to Fund to Fund Fund to Fund - -------------------------------------------------------------------------------- 2004 $34,800 $2,029 $3,100 $0 - -------------------------------------------------------------------------------- 2003 $25,177 $722 $2,925 $0 - -------------------------------------------------------------------------------- The above "Tax Fees" were billed for professional services rendered for tax compliance. Services that the Fund's Auditor Billed to the Adviser and Affiliated Fund Service Providers The following table shows the amount of fees billed by PWC to investment Company Capital Corp. ("ICCC" or the "Adviser"), and any entity controlling, controlled by or under common control with ICCC ("Control Affiliate") that provides ongoing services to the Fund ("Affiliated Fund Service Provider"), for engagements directly related to the Fund's operations and financial reporting, during the Fund's last two fiscal years. - -------------------------------------------------------------------------------- Audit-Related All Fees Billed to Tax Fees Billed to Other Fees Billed Fiscal Year Adviser and Adviser and to Adviser and Ended Affiliated Fund Affiliated Fund Affiliated Fund March 31 Service Providers Service Providers Service Providers - -------------------------------------------------------------------------------- 2004 $573,742 $0 $0 - -------------------------------------------------------------------------------- 2003 $452,700 $69,500 $34,400 - -------------------------------------------------------------------------------- The "Audit-Related Fees" were billed for services in connection with the assessment of internal controls, agreed-upon procedures and additional related procedures. Non-Audit Services The following table shows the amount of fees that PWC billed during the Fund's last two fiscal years for non-audit services. For engagements entered into on or after May 6, 2003, the Audit Committee pre-approved all non-audit services that PWC provided to the Adviser and any Affiliated Fund Service Provider that related directly to the Fund's operations and financial reporting. The Audit Committee requested and received information from PWC about any non-audit services that PWC rendered during the Fund's last fiscal year to the Adviser and any Affiliated Fund Service Provider. The Committee considered this information in evaluating PWC's independence. - -------------------------------------------------------------------------------- Total Non-Audit Fees billed to Adviser and Affiliated Fund Service Providers Total (engagements Non-Audit related Fees billed directly to Adviser to the and Affiliated Total operations Fund Service Non-Audit and financial Providers Fiscal Billed Fees reporting (all other Total of Year to Fund of the Fund) engagements) (A), (B) Ended March 31 (A) (B) (C) and (C) - -------------------------------------------------------------------------------- 2004 $3,100 $0 $2,412,058 $2,415,158 - -------------------------------------------------------------------------------- 2003 $2,925 $103,900 $17,512,166 $17,618,991 - -------------------------------------------------------------------------------- All other engagement fees were billed for services in connection with risk management, tax services and process improvement/integration initiatives for ICCC and other related entities that provide support for the operations of the fund. ITEM 5. [RESERVED] ITEM 6. [RESERVED] ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES. ITEM 8. [RESERVED] ITEM 9. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. The Nominating and Governance Committee evaluates and nominates Board member candidates. Fund shareholders may also submit nominees that will be considered by the Committee when a Board vacancy occurs. Submissions should be mailed to the attention of the Secretary of the Fund, One South Street, Baltimore, MD 21202. ITEM 10. CONTROLS AND PROCEDURES. (a) The Chief Executive and Financial Officers concluded that the Registrant's Disclosure Controls and Procedures are effective based on the evaluation of the Disclosure Controls and Procedures as of a date within 90 days of the filing date of this report. Fund management has previously identified a significant deficiency relating to the overall fund expense payment and accrual process. This matter relates primarily to a bill payment processing issue. There was no material impact to shareholders, fund net asset value, fund performance or the accuracy of any fund's financial statements. Fund management discussed this matter with the Registrant's Audit Committee and auditors, instituted additional procedures to enhance its internal controls and will continue to develop additional controls and redesign work flow to strengthen the overall control environment associated with the processing and recording of fund expenses. (b) There have been no changes in the registrant's internal control over financial reporting that occurred during the filing period that has materially affected, or is reasonably likely to materially affect, the registrant's internal controls over financial reporting. ITEM 11. EXHIBITS. (a)(1) Code of Ethics pursuant to Item 2 of Form N-CSR is filed and attached hereto as EX-99.CODE ETH. (a)(2) Certification pursuant to Rule 30a-2(a) under the Investment Company Act of 1940 (17 CFR 270.30a-2(a)) is filed and attached hereto as Exhibit 99.CERT. (b) Certification pursuant to Rule 30a-2(b) under the Investment Company Act of 1940 (17 CFR 270.30a-2(b)) is furnished and attached hereto as Exhibit 99.906CERT. Form N-CSR Item F 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: Deutsche Bank Alex Brown Cash Reserves Portfolio By: /s/Richard T. Hale --------------------------- Richard T. Hale Chief Executive Officer Date: May 28, 2004 --------------------------- 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. Registrant: Deutsche Bank Alex Brown Cash Reserves Portfolio By: /s/Richard T. Hale --------------------------- Richard T. Hale Chief Executive Officer Date: May 28, 2004 --------------------------- By: /s/Charles A. Rizzo --------------------------- Charles A. Rizzo Chief Financial Officer Date: May 28, 2004 --------------------------- Form N-CSR Item F 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: Deutsche Bank Alex Brown Cash Reserves Tax-Free Portfolio By: /s/Richard T. Hale --------------------------- Richard T. Hale Chief Executive Officer Date: May 28, 2004 --------------------------- 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. Registrant: Deutsche Bank Alex Brown Cash Reserves Tax-Free Portfolio By: /s/Richard T. Hale --------------------------- Richard T. Hale Chief Executive Officer Date: May 28, 2004 --------------------------- By: /s/Charles A. Rizzo --------------------------- Charles A. Rizzo Chief Financial Officer Date: May 28, 2004 --------------------------- Form N-CSR Item F 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: Deutsche Bank Alex Brown Cash Reserves Treasury Portfolio By: /s/Richard T. Hale --------------------------- Richard T. Hale Chief Executive Officer Date: May 28, 2004 --------------------------- 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. Registrant: Deutsche Bank Alex Brown Cash Reserves Treasury Portfolio By: /s/Richard T. Hale --------------------------- Richard T. Hale Chief Executive Officer Date: May 28, 2004 --------------------------- By: /s/Charles A. Rizzo --------------------------- Charles A. Rizzo Chief Financial Officer Date: May 28, 2004 ---------------------------