Tax Exempt Bond Fund Of America N14 Registration statement for investment companies business combination | SEC 18 Mar 16

Invest for income

exempt from federal

and state taxes.

The Tax-Exempt Fund of Maryland^®

The Tax-Exempt Fund of Virginia^®

Annual reports
for the year ended
July 31, 2015

The Tax-Exempt Fund of Maryland seeks to provide you with a high level of current income exempt from regular federal and Maryland state income taxes. Its secondary objective is preservation of capital.

The Tax-Exempt Fund of Virginia seeks to provide you with a high level of current income exempt from regular federal and Virginia state income taxes. Its secondary objective is preservation of capital.

These funds are two of more than 40 offered by one of the nation’s largest mutual fund families, American Funds, from Capital Group. For more than 80 years, Capital has invested with a long-term focus based on thorough research and attention to risk.

Fund results shown in this report, unless otherwise indicated, are for Class A shares at net asset value. If a sales charge (maximum 3.75%) had been deducted, the results would have been lower. Results are for past periods and are not predictive of results for future periods. Current and future results may be lower or higher than those shown. Share prices and returns will vary, so investors may lose money. Investing for short periods makes losses more likely. Investments are not FDIC-insured, nor are they deposits of or guaranteed by a bank or any other entity, so they may lose value. For current information and month-end results, visit americanfunds.com.

Here are the average annual total returns on a $1,000 investment with all distributions reinvested for periods ended June 30, 2015 (the most recent calendar quarter-end):

Class A shares		1 year			5 years			10 years

Reflecting 3.75% maximum sales charge	The Tax-Exempt Fund of Maryland		–2.04	%		2.78	%		2.91	%
	The Tax-Exempt Fund of Virginia		–1.93			2.72			3.09
At net asset value	The Tax-Exempt Fund of Maryland		1.76			3.57			3.30
	The Tax-Exempt Fund of Virginia		1.90			3.51			3.48

For other share class results, visit americanfunds.com.

The total annual fund operating expense ratios are 0.69% for The Tax-Exempt Fund of Maryland and 0.66% for The Tax-Exempt Fund of Virginia for Class A shares as of the prospectus dated October 1, 2015 (unaudited).

Investment results assume all distributions are reinvested and reflect applicable fees and expenses. When applicable, investment results reflect fee waivers, without which results would have been lower. Visit americanfunds.com for more information.

The funds’ 30-day yields for Class A shares as of August 31, 2015, calculated in accordance with the U.S. Securities and Exchange Commission (SEC) formula, were 1.76% for The Tax-Exempt Fund of Maryland and 1.45% for The Tax-Exempt Fund of Virginia. (For investors in the 48.47% Maryland tax bracket and the 46.65% Virginia tax bracket, this is equivalent to taxable yields of 3.42% for The Tax-Exempt Fund of Maryland and 2.72% for The Tax-Exempt Fund of Virginia.) The funds’ 12-month distribution rates for Class A shares as of that date were 3.06% and 2.97%, respectively. All figures reflect the 3.75% maximum sales charge. The SEC yield reflects the rate at which each fund is earning income on its current portfolio of securities while the distribution rate reflects the funds’ past dividends paid to shareholders. Accordingly, the funds’ SEC yields and distribution rates may differ.

All investments are subject to certain risks. The value of shares of the funds will fluctuate as interest rates change. Bond funds carry the risks of the securities in which they invest, such as inflation, interest rate fluctuations and credit or default risk. The return of principal for bond funds is not guaranteed. Additionally, each fund is more susceptible to factors adversely affecting issuers of its state’s tax-exempt securities than a more widely diversified municipal bond fund. Bond ratings, which typically range from AAA/Aaa (highest) to D (lowest), are assigned by credit rating agencies such as Standard & Poor’s, Moody’s and/ or Fitch as an indication of an issuer’s creditworthiness. Income may be subject to federal alternative minimum taxes. Certain other income, as well as capital gain distributions, may be taxable. Refer to the fund prospectus and the Risk Factors section of this report for more information on these and other risks associated with investing in the funds.

Cover: Ronald Reagan Washington National Airport, Arlington, VA.

The funds’ portfolios
are conservatively
positioned and broadly
diversified among
various sectors.

Contents

1	Letter to investors

	Fund reviews
4	The Tax-Exempt Fund of Maryland
5	The Tax-Exempt Fund of Virginia

	Summary investment portfolios
6	The Tax-Exempt Fund of Maryland
13	The Tax-Exempt Fund of Virginia

	Financial statements
11	The Tax-Exempt Fund of Maryland
19	The Tax-Exempt Fund of Virginia

35	Board of trustees and other officers

Fellow investors:

We are pleased to present you with this annual report for The Tax-Exempt Fund of Maryland and The Tax-Exempt Fund of Virginia. This report covers results from August 1, 2014, through July 31, 2015, the conclusion of the funds’ fiscal year.

After rising during the first half of the fiscal year, municipal bond prices faltered in the closing months of the period, as the U.S. economy strengthened and investors anticipated the start of an interest-rate tightening cycle by the Federal Reserve.

For the 12-month period, The Tax-Exempt Fund of Maryland (the Maryland fund) and The Tax-Exempt Fund of Virginia (the Virginia fund) had total returns of 2.26% and 2.43%, respectively, with all dividends reinvested, which were below their peer group averages.

The table below highlights the funds’ average annual total returns over longer periods. While lagging their respective indexes (the Barclays Maryland Municipal Index and the Barclays Virginia Municipal Index), the funds have outpaced their peer-group averages (the Lipper Maryland Municipal Debt Funds Average and the Lipper Virginia Municipal Debt Funds Average) over five- and 10-year periods.

The Maryland fund distributed tax-free income dividends of approximately 51 cents a share, and the Virginia fund approximately 52 cents a share for this fiscal year. Neither fund made capital gain distributions.

During the period, the Maryland fund’s tax-exempt income return, with dividends reinvested, was 3.24%, which is equivalent to a 6.29% taxable return for those in the highest combined federal, state and local tax bracket of 48.47%. If dividends were taken in cash, the income return was 3.19%, the equivalent of a 6.19% taxable income

Results at a glance

Average annual total returns for periods ended July 31, 2015, with all distributions reinvested

	1 year			5 years			10 years

The Tax-Exempt Fund of Maryland (Class A shares)		2.26	%		3.42	%		3.42	%
Barclays Maryland Municipal Index*		2.76			3.41			4.20
Lipper Maryland Municipal Debt Funds Average		2.60			3.11			3.38

The Tax-Exempt Fund of Virginia (Class A shares)		2.43			3.36			3.60
Barclays Virginia Municipal Index*		3.33			3.72			4.32
Lipper Virginia Municipal Debt Funds Average		2.53			3.19			3.42

*	The market indexes are unmanaged and, therefore, have no expenses. Investors cannot invest directly in an index.

The American Funds Tax-Exempt Series І

return. For the same period, the Virginia fund’s tax-exempt income return, with dividends reinvested, was 3.12%, which is equivalent to a 5.85% taxable return for those in the highest combined federal and state tax bracket of 46.65%. If dividends were taken in cash, the income return was 3.08%, the equivalent of a 5.77% taxable income return.

Economic and market overview

The fiscal year comprised two distinct and contrasting periods. During the first half, the broad U.S. fixed-income market rallied as investors focused on weak economic growth in major markets around the world, the evolving fiscal crisis in Greece and aggressive stimulus measures taken by central banks in Europe, Japan and China.

In the closing months of the period, however, municipal bonds lost ground along with the broader fixed-income market amid growing evidence that the U.S. economy was gaining strength. U.S. employers continued to add jobs at a healthy rate: The economy added 215,000 jobs in July, and the unemployment rate held at 5.3%. Improving consumer confidence, rising home prices and strong auto sales further suggested an upbeat economic backdrop.

With Fed officials repeatedly signaling that they intend to hike rates in 2015, the yield on the benchmark 10-year U.S. Treasury bond rose from 2.17% on December 31 to a high of 2.50% on June 10. A flare-up in Greece’s long-running debt crisis and a sharp decline in China’s stock market sparked a late-period rally, as investors sought the relative safety of bonds. The rally contributed to a moderate decline in bond yields, as the 10-year Treasury yield fell to 2.20% as of July 31.

Municipal bond issuance was robust for much of the year, driven largely by increased refunding as issuers looked to take advantage of attractive borrowing costs. However, volume slowed toward the end of the period, with about $34 billion of municipal bonds issued in May, June and July. Investor demand declined during the second half of the period, adding to the downward pressure on municipal bond prices.

In June, Puerto Rico’s long-running debt crisis returned to news headlines after the island’s governor said the U.S. commonwealth’s debts of about $72 billion were “not payable” and indicated that some form of restructuring of the debt would be necessary. Efforts are under way to negotiate a resolution between the government, investors and other stakeholders. We remind investors that the municipal bond market is vast and diverse, and Puerto Rico’s unique challenges have little bearing on the health of most of the thousands of issuers in the market. The Maryland and Virginia funds’ portfolio managers have taken a very selective approach to investing

2	The American Funds Tax-Exempt Series І

in Puerto Rico, and their exposure is relatively light.

While the Puerto Rican debt crisis triggered volatility in the high yield municipal bond market, it has had a limited impact on the broader tax-exempt market. The Barclays High-Yield Municipal Bond Index rose 2.63% for the fiscal year. That compares with a 3.56% gain for the Barclays Municipal Bond Index, a broad measure of the investment-grade (rated BBB/Baa and above) tax-exempt market. In terms of maturities, longer term bonds tended to outpace shorter duration bonds. Overall, revenue bonds, which support essential services such as water, sewer and electric utilities, generated higher returns than general obligation bonds.

The funds’ portfolios

Both funds continue to hold mostly high-quality, investment-grade bonds rated BBB/Baa or better, and the portfolio managers’ credit research helps in the search for lower rated bonds that may offer opportunities. The funds’ portfolios are broadly diversified, favoring revenue bonds, which are backed by dedicated revenue streams or businesses, over general obligation bonds. Revenue bonds support infrastructure and specific projects. The funds’ investments in municipal bonds related to hospitals and housing were among those with the strongest nominal contributions to returns in this period, while bonds related to higher education made less of a contribution.

We continue to maintain a conservative approach to the broad municipal bond market, with relatively short duration positions in anticipation of rising rates. While short-term bonds may lower risk, they’ve also offered lower yield, but we believe we are well-positioned for an environment of higher interest rates.

Going forward

The U.S. economy is strengthening, and given long-term trends in employment, housing and other measures, we expect that it will continue to improve and that the Fed will raise short-term interest rates before the end of 2015. The recent volatility in the municipal bond market was driven primarily by the expectation of rising rates and of specific credit news elsewhere — conditions that we believe we are well prepared to manage through.

While rising rates can adversely impact bond prices in the short-term, it is important to remember that over time, higher interest rates can benefit fixed-income investors because they allow proceeds from maturing bonds to be re-invested at higher yields, which can lead to better total-return opportunities. In June, Fed officials seemed to indicate that once the central bank begins raising rates, it will do so at a gradual pace. At press-time, we were awaiting news from the Fed’s next meeting September 16-17.

In addition, we believe that our bottom-up fundamental research process can help us avoid troubled issuers in the market and identify bonds that can add value for our investors. As always, we remain vigilant in our efforts to maintain an appropriate balance between risk and potential reward, continuously mindful of the potential for heightened volatility.

We are grateful for the confidence you have placed in us, and we look forward to reporting back to you in six months.

Sincerely,

Paul F. Roye

Vice Chairman of the Board

Brenda S. Ellerin

President

September 10, 2015

For current information about the funds, visit americanfunds.com.

The American Funds Tax-Exempt Series І

The Tax-Exempt Fund of Maryland

How a $10,000 investment has grown

Fund results shown are for Class A shares and, unless otherwise indicated, reflect deduction of the maximum sales charge of 3.75% on the $10,000 investment.¹Thus, the net amount invested was $9,625. Results are for past periods and are not predictive of results for future periods. Current and future results may be lower or higher than those shown. Share prices and returns will vary, so investors may lose money. For current information and month-end results, visit americanfunds.com.

¹	As outlined in the prospectus, the sales charge is reduced for accounts (and aggregated investments) of $100,000 or more and is eliminated for purchases of $1 million or more. There is no sales charge on dividends or capital gain distributions that are reinvested in additional shares.
²	Assumes reinvestment of all distributions and payment of the maximum 3.75% sales charge.
³	The index is unmanaged and, therefore, has no expenses. Investors cannot invest directly in an index.
⁴	Results at net asset value (not including sales charge), with distributions reinvested.
⁵	Results reflect fund expenses but do not reflect any sales charges.
⁶	Computed from data supplied by the U.S. Department of Labor, Bureau of Labor Statistics.

The results shown are before taxes on fund distributions and sale of fund shares.

Tax-exempt yields vs. taxable yields

Find your estimated taxable income in the chart to determine your federal, state and local tax rate,* then look in the right-hand column to see what you would have had to earn from a taxable investment to equal the Maryland fund’s 3.10% tax-free distribution rate^†as of July 31, 2015.

If your taxable income is …						… then your combined federal, state and local		The 3.10% distribution rate is equivalent to a
Single			Married filing jointly			tax rate is …		taxable rate of …
$	3,001 –	9,225	$	3,001 –	18,450	17.16	%	3.74	%
	9,226 –	37,450		18,451 –	74,900	21.76		3.96
	37,451 –	90,750		74,901 –	150,000	30.96		4.49
	90,751 –	100,000		150,001 –	151,200	31.15		4.50
	100,001 –	125,000		151,201 –	175,000	33.90		4.69
	125,001 –	150,000		175,001 –	225,000	34.08		4.70
	150,001 –	189,300		225,001 –	230,450	34.26		4.72
	189,301 –	250,000		230,451 –	300,000	42.30		5.37
	250,001 –	411,500		300,001 –	411,500	42.46		5.39
	411,501 –	413,200		411,501 –	464,850	44.28		5.56
	over 413,200			over 464,850		48.47		6.02

Based on 2015 federal, 2015 state and 2015 local tax rates (state rates from 4.75% to 5.75% are individually calculated for each bracket; the federal brackets are expanded to include the additional state brackets; maximum local tax rate of 3.20%). The combined federal, state and local tax rates are “effective” tax rates, reflecting the deductibility of applicable state and local taxes on federal tax returns. The lower the effective tax rate, the lower the taxable equivalent yield.

^†

The distribution rate is based on dividends paid over the last 12 months divided by the maximum offering price as of July 31, 2015. Capital gains distributions, if any, are added back at the maximum offering price to determine the rate.

Based on 2015 federal tax rates. For the 2015 calendar year there will be an Unearned Income Medicare Contribution Tax of 3.8% that applies to net investment income for taxpayers whose modified adjusted gross income exceeds $200,000 (for single filers) and $250,000 (for married filing jointly). As such, taxpayers in the highest tax bracket will face a combined 43.4% marginal tax rate on their investment income. The federal rates do not include an adjustment for the loss of personal exemptions and the phaseout of itemized deductions that are applicable to certain taxable income levels.

4	The American Funds Tax-Exempt Series I

The Tax-Exempt Fund of Virginia

How a $10,000 investment has grown

¹	As outlined in the prospectus, the sales charge is reduced for accounts (and aggregated investments) of $100,000 or more and is eliminated for purchases of $1 million or more. There is no sales charge on dividends or capital gain distributions that are reinvested in additional shares.
²	Assumes reinvestment of all distributions and payment of the maximum 3.75% sales charge.
³	The index is unmanaged and, therefore, has no expenses. Investors cannot invest directly in an index.
⁴	Results at net asset value (not including sales charge), with distributions reinvested.
⁵	Results reflect fund expenses but do not reflect any sales charges.
⁶	Computed from data supplied by the U.S. Department of Labor, Bureau of Labor Statistics.

The results shown are before taxes on fund distributions and sale of fund shares.

Tax-exempt yields vs. taxable yields

Find your estimated taxable income in the chart to determine your federal and state tax rate,* then look in the right-hand column to see what you would have had to earn from a taxable investment to equal the Virginia fund’s 2.98% tax-free distribution rate^†as of July 31, 2015.

If your taxable income is …						… then your combined federal and state		The 2.98% distribution rate is equivalent to a
Single			Married filing jointly			tax rate is …		taxable rate of …
$	3,001 –	5,000	$	3,001 –	5,000	12.70	%	3.41	%
	5,001 –	9,225		5,001 –	17,000	14.50		3.49
	–			17,001 –	18,450	15.18		3.51
	9,226 –	17,000		–		19.25		3.69
	17,001 –	37,450		18,451 –	74,900	19.89		3.72
	37,451 –	90,750		74,901 –	151,200	29.31		4.22
	90,751 –	189,300		151,201 –	230,450	32.14		4.39
	189,301 –	411,500		230,451 –	411,500	40.43		5.00
	411,501 –	413,200		411,501 –	464,850	42.32		5.17
	over 413,200			over 464,850		46.65		5.59

Based on 2015 federal and 2015 state tax rates (state rates from 3.00% to 5.75% are individually calculated for each bracket; the federal brackets are expanded to include the additional state brackets). The combined federal and state tax rates are “effective” tax rates, reflecting the deductibility of applicable state taxes on federal tax returns. The lower the effective tax rate, the lower the taxable equivalent yield.

^†

The American Funds Tax-Exempt Series I

The Tax-Exempt Fund of Maryland

Summary investment portfolio July 31, 2015

Portfolio quality summary*

Percent of net assets

Bond ratings, which typically range from AAA/Aaa (highest) to D (lowest), are assigned by credit rating agencies such as Standard & Poor’s, Moody’s and/or Fitch as an indication of an issuer’s creditworthiness. In assigning a credit rating to a security, the fund looks specifically to the ratings assigned to the issuer of the security by Standard & Poor’s, Moody’s and/or Fitch. If agency ratings differ, the security will be considered to have received the highest of those ratings, consistent with the fund’s investment policies. Securities in the “unrated” category (above) have not been rated by a rating agency; however, the investment adviser performs its own credit analysis and assigns comparable ratings that are used for compliance with the fund’s investment policies. The ratings are not covered by the Report of Independent Registered Public Accounting Firm.

Bonds, notes & other debt instruments 95.72%	Principal amount (000)		Value (000)
Maryland 84.66%

State issuers 49.61%
Community Dev. Administration, Dept. of Housing and Community Dev., Residential Rev. Bonds, Series 2014-B, AMT, 3.25% 2044	$	2,045	$	2,137
Community Dev. Administration, Dept. of Housing and Community Dev., Residential Rev. Ref. Bonds, Series 2014-D, AMT, 4.00% 2036		3,110		3,361
Community Dev. Administration, Dept. of Housing and Community Dev., Residential Rev. Ref. Bonds, Series D, AMT, 4.65% 2022		1,000		1,030
Community Dev. Administration, Dept. of Housing and Community Dev., Single-family Housing Rev. Bonds, Series 2011-B, 4.00% 2027		940		983
Econ. Dev. Corp., Senior Student Housing Rev. Ref. Bonds (University of Maryland, Baltimore Project), Series 2015, 5.00% 2035		1,000		1,064
Econ. Dev. Corp., Senior Student Housing Rev. Ref. Bonds (University of Maryland, Baltimore Project), Series 2015, 5.00% 2039		2,605		2,751
Econ. Dev. Corp., Student Housing Rev. Bonds (Towson University Project), Series 2007-A, 5.25% 2024		1,000		1,073
Econ. Dev. Corp., Student Housing Rev. Bonds (Towson University Project), Series 2007-A, 5.25% 2037		3,265		3,443
Econ. Dev. Corp., Student Housing Rev. Bonds (Towson University Project), Series 2012, 5.00% 2027		700		757
Econ. Dev. Corp., Student Housing Rev. Bonds (Towson University Project), Series 2012, 5.00% 2029		250		268
Econ. Dev. Corp., Student Housing Rev. Bonds (University of Maryland, College Park Projects), Series 2008, 5.80% 2038		3,000		3,252
Econ. Dev. Corp., Student Housing Rev. Bonds (University of Maryland, College Park Projects), Series 2008, 5.875% 2043		950		1,032
Econ. Dev. Corp., Student Housing Rev. Ref. Bonds (Morgan State University Project), Series 2012, 5.00% 2034		2,930		3,053
Econ. Dev. Corp., Student Housing Rev. Ref. Bonds (University of Maryland, College Park Projects), Series 2006, Assured Guaranty insured, 5.00% 2021		1,000		1,033
Econ. Dev. Corp., Student Housing Rev. Ref. Bonds (University of Maryland, College Park Projects), Series 2006, Assured Guaranty insured, 5.00% 2026		1,000		1,031
Econ. Dev. Corp., Utility Infrastructure Rev. Ref. Bonds (University of Maryland, College Park Project), Series 2011, 5.00% 2018		3,000		3,317
Econ. Dev. Corp., Student Housing Rev. Ref. Bonds (Bowie State University Project), Series 2015, 5.00% 2033¹		2,540		2,599
G.O. Bonds, State and Local Facs. Loan of 2008, Second Series, 5.00% 2021 (preref. 2018)		2,000		2,238
G.O. Bonds, State and Local Facs. Loan of 2009, Second Series B, 5.00% 2020		3,000		3,444
G.O. Bonds, State and Local Facs. Loan of 2011, Second Series B, 5.00% 2023 (preref. 2019)		2,000		2,304
G.O. Capital Improvement Bonds, State and Local Facs., Series 2014-A, 4.00% 2018 (preref. 2015)		3,000		3,000
G.O. Ref. Bonds, State and Local Facs. Loan of 2010, First Series B, 5.00% 2022		2,000		2,307
Health and Higher Educational Facs. Auth., Rev. Bonds (Johns Hopkins University Issue), Series 2015-A, 5.00% 2028		1,650		1,924

6	The American Funds Tax-Exempt Series I

	Principal amount		Value
	(000)		(000)

Health and Higher Educational Facs. Auth., Rev. Bonds (Carroll Hospital Center Issue), Series 2006, 4.50% 2026	$	1,000	$	1,038
Health and Higher Educational Facs. Auth., Rev. Bonds (Carroll Hospital Center Issue), Series 2006, 5.00% 2036		1,500		1,564
Health and Higher Educational Facs. Auth., Rev. Bonds (Johns Hopkins University Issue), Series 2008-A, 5.00% 2018		2,000		2,240
Health and Higher Educational Facs. Auth., Rev. Bonds (LifeBridge Health Issue), 5.00% 2047		1,000		1,094
Health and Higher Educational Facs. Auth., Rev. Bonds (LifeBridge Health Issue), Series 2011, 5.50% 2026		700		806
Health and Higher Educational Facs. Auth., Rev. Bonds (LifeBridge Health Issue), Series 2011, 5.75% 2031		2,000		2,273
Health and Higher Educational Facs. Auth., Rev. Bonds (LifeBridge Health Issue), Series 2011, 6.00% 2025		425		506
Health and Higher Educational Facs. Auth., Rev. Bonds (Mercy Medical Center Issue), Series 2007-A, 5.00% 2032		2,000		2,097
Health and Higher Educational Facs. Auth., Rev. Bonds (Peninsula Regional Medical Center Issue), Series 2006, 5.00% 2016		1,200		1,252
Health and Higher Educational Facs. Auth., Rev. Bonds (Peninsula Regional Medical Center Issue), Series 2006, 5.00% 2021		1,000		1,042
Health and Higher Educational Facs. Auth., Rev. Bonds (Peninsula Regional Medical Center Issue), Series 2006, 5.00% 2036		1,750		1,824
Health and Higher Educational Facs. Auth., Rev. Bonds (Peninsula Regional Medical Center Issue), Series 2015, 5.00% 2045		1,350		1,455
Health and Higher Educational Facs. Auth., Rev. Bonds (University of Maryland Medical System Issue), Series 2006-A, 5.00% 2036		1,000		1,043
Health and Higher Educational Facs. Auth., Rev. Bonds (University of Maryland Medical System Issue), Series 2010, 5.00% 2034		1,000		1,076
Health and Higher Educational Facs. Auth., Rev. Bonds (University of Maryland Medical System Issue), Series 2010, 5.25% 2024		1,240		1,382
Health and Higher Educational Facs. Auth., Rev. Ref. Bonds (Anne Arundel Health System Issue), Series 2012, 4.00% 2034		1,000		1,007
Health and Higher Educational Facs. Auth., Rev. Ref. Bonds (Anne Arundel Health System Issue), Series 2012, 5.00% 2021		800		927
Health and Higher Educational Facs. Auth., Rev. Ref. Bonds (Anne Arundel Health System Issue), Series 2012, 5.00% 2027		400		451
Health and Higher Educational Facs. Auth., Rev. Ref. Bonds (Anne Arundel Health System Issue), Series 2014, 5.00% 2039		2,000		2,165
Health and Higher Educational Facs. Auth., Rev. Ref. Bonds (Carroll Hospital Center Issue), Series 2012-A, 5.00% 2037		1,500		1,602
Health and Higher Educational Facs. Auth., Rev. Ref. Bonds (LifeBridge Health Issue), Series 2008, Assured Guaranty insured, 4.75% 2038		1,000		1,017
Health and Higher Educational Facs. Auth., Rev. Ref. Bonds (LifeBridge Health Issue), Series 2008, Assured Guaranty insured, 5.00% 2020		2,710		2,914
Health and Higher Educational Facs. Auth., Rev. Ref. Bonds (LifeBridge Health Issue), Series 2008, Assured Guaranty insured, 5.00% 2028		1,000		1,053
Health and Higher Educational Facs. Auth., Rev. Ref. Bonds (MedStar Health Issue), 5.00% 2038		1,000		1,094
Health and Higher Educational Facs. Auth., Rev. Ref. Bonds (MedStar Health Issue), Series 2004, 5.75% 2015		1,000		1,002
Health and Higher Educational Facs. Auth., Rev. Ref. Bonds (Mercy Medical Center Issue), Series 2012, 5.00% 2031		1,000		1,057
Health and Higher Educational Facs. Auth., Rev. Ref. Bonds (Mercy Ridge Issue), Series 2007, 4.50% 2022		1,065		1,095
Health and Higher Educational Facs. Auth., Rev. Ref. Bonds (Mercy Ridge Issue), Series 2007, 4.75% 2034		3,590		3,647
Health and Higher Educational Facs. Auth., Rev. Ref. Bonds (MedStar Health Issue), 5.00% 2042		5,000		5,420
Morgan State University, Public Higher Education Institution of the State of Maryland, Academic Fees and Auxiliary Facs. Fees Rev. Ref. Bonds, Series 2012, 5.00% 2021		230		267
Morgan State University, Public Higher Education Institution of the State of Maryland, Academic Fees and Auxiliary Facs. Fees Rev. Ref. Bonds, Series 2012, 5.00% 2022		360		422
Morgan State University, Public Higher Education Institution of the State of Maryland, Academic Fees and Auxiliary Facs. Fees Rev. Ref. Bonds, Series 2012, 5.00% 2023		320		377
Morgan State University, Public Higher Education Institution of the State of Maryland, Academic Fees and Auxiliary Facs. Fees Rev. Ref. Bonds, Series 2012, 5.00% 2024		600		701
Morgan State University, Public Higher Education Institution of the State of Maryland, Academic Fees and Auxiliary Facs. Fees Rev. Ref. Bonds, Series 2012, 5.00% 2028		300		339
Morgan State University, Public Higher Education Institution of the State of Maryland, Academic Fees and Auxiliary Facs. Fees Rev. Ref. Bonds, Series 2012, 5.00% 2030		150		168
Morgan State University, Public Higher Education Institution of the State of Maryland, Academic Fees and Auxiliary Facs. Fees Rev. Ref. Bonds, Series 2012, 5.00% 2032		225		250
Transportation Auth., Passenger Fac. Charge Rev. Bonds (Baltimore/Washington International Thurgood Marshall Airport), AMT, 5.00% 2020		2,165		2,479

The American Funds Tax-Exempt Series I

The Tax-Exempt Fund of Maryland

Bonds, notes & other debt instruments (continued)	Principal amount (000)		Value (000)
Maryland (continued)

State issuers (continued)
Dept. of Transportation, Consolidated Transportation Bonds, Series 2002, 5.50% 2017	$	2,000	$	2,150
Dept. of Transportation, Consolidated Transportation Bonds, Series 2007, 4.00% 2018		1,630		1,716
Dept. of Transportation, Consolidated Transportation Bonds, Series 2008, 5.00% 2018		1,000		1,105
Transportation Auth., Airport Parking Rev. Ref. Bonds (Baltimore/Washington International Thurgood Marshall Airport Projects), Series 2012-B, AMT, 5.00% 2021		2,000		2,297
Transportation Auth., Airport Parking Rev. Ref. Bonds (Baltimore/Washington International Thurgood Marshall Airport Projects), Series 2012-B, AMT, 5.00% 2023		3,720		4,257
Transportation Auth., Grant and Rev. Anticipation Bonds, Series 2007, 5.00% 2019		2,500		2,668
Transportation Auth., Grant and Rev. Anticipation Bonds, Series 2008, 5.25% 2018		3,000		3,339
Transportation Auth., Grant and Rev. Anticipation Bonds, Series 2008, 5.25% 2020		1,000		1,133
Transportation Auth., Passenger Fac. Charge Rev. Bonds (Baltimore/Washington International Thurgood Marshall Airport), Series 2012-B, AMT, 4.00% 2019		1,000		1,092
Transportation Auth., Passenger Fac. Charge Rev. Bonds (Baltimore/Washington International Thurgood Marshall Airport), Series 2012-B, AMT, 4.00% 2020		1,515		1,665
Transportation Auth., Passenger Fac. Charge Rev. Bonds (Baltimore/Washington International Thurgood Marshall Airport), Series 2014, AMT, Assured Guaranty Municipal insured, 3.00% 2024		500		501
Transportation Auth., Passenger Fac. Charge Rev. Bonds (Baltimore/Washington International Thurgood Marshall Airport), Series 2014, AMT, Assured Guaranty Municipal insured, 3.50% 2028		1,500		1,494
Transportation Auth., Transportation Facs. Projects Rev. Bonds, Series 2007, Assured Guaranty Municipal insured, 5.00% 2021		3,000		3,241
Transportation Auth., Transportation Facs. Projects Rev. Bonds, Series 2008, 5.00% 2020		1,545		1,716
Transportation Auth., Transportation Facs. Projects Rev. Bonds, Series 2008, 5.00% 2023		3,140		3,477
Transportation Auth., Transportation Facs. Projects Rev. Bonds, Series 2009-A, 5.00% 2020		1,000		1,137
Transportation Auth., Transportation Facs. Projects Rev. Bonds, Series 2009-A, 5.00% 2021		1,000		1,135
Transportation Auth., Transportation Facs. Projects Rev. Ref. Bonds, Series 2012, 4.00% 2026		1,000		1,086
Water Quality Fncg. Administration, Revolving Loan Fund Rev. Bonds, Series 2008-A, 4.40% 2025		1,750		1,888
Water Quality Fncg. Administration, Revolving Loan Fund Rev. Bonds, Series 2008-A, 5.00% 2021		1,245		1,373
Other securities				19,988
				156,005

City & county issuers 35.05%
Anne Arundel County, Special Obligation Bonds (National Business Park-North Project), Series 2010, 6.10% 2040		2,250		2,386
Baltimore County, G.O. Bonds, Metropolitan Dist. Bonds (71st Issue), 4.625% 2028		1,500		1,642
Baltimore County, Rev. Ref. Bonds (Oak Crest Village, Inc. Fac.), Series 2007-A, 5.00% 2022		2,600		2,715
Baltimore County, Rev. Ref. Bonds (Oak Crest Village, Inc. Fac.), Series 2007-A, 5.00% 2037		2,000		2,055
Mayor and City Council of Baltimore, G.O. Consolidated Public Improvement Bonds, Series 2008-A, 5.00% 2020		2,315		2,608
Mayor and City Council of Baltimore, Project and Rev. Ref. Bonds (Water Projects), Series 1994-A, FGIC insured, 5.00% 2024		2,275		2,539
Mayor and City Council of Baltimore, Project Rev. Bonds (Water Projects), Series 2011-A, 5.00% 2041		1,000		1,111
Mayor and City Council of Baltimore, Rev. Bonds (Wastewater Projects), Series 2014-C, 5.00% 2032		2,000		2,310
Mayor and City Council of Baltimore, Rev. Bonds (Water Projects), Series 2014-A, 5.00% 2044		1,500		1,683
Mayor and City Council of Baltimore, Rev. Ref. Bonds (Wastewater Projects), Series 2014, 5.00% 2039		3,215		3,635
Carroll County, G.O. Bonds, Consolidated Public Improvement Bonds of 2008, 5.00% 2021		2,800		3,164
Frederick County, G.O. Public Facs. Bonds of 2008, 5.00% 2021 (preref. 2018)		2,005		2,236
Frederick County, G.O. Public Facs. Bonds of 2008, 5.00% 2024 (preref. 2018)		1,000		1,115
Frederick County, Special Obligation Bonds (Urbana Community Dev. Auth.), Series 2010-A, 5.00% 2023		1,500		1,686
Frederick County, Special Obligation Bonds (Urbana Community Dev. Auth.), Series 2010-A, 5.00% 2030		3,000		3,334
City of Gaithersburg, Econ. Dev. Rev. Ref. Bonds (Asbury Maryland Obligated Group), Series 2006-A, 5.125% 2026		1,000		1,023
City of Gaithersburg, Econ. Dev. Rev. Ref. Bonds (Asbury Maryland Obligated Group), Series 2006-A, 5.125% 2036		1,500		1,524
City of Gaithersburg, Econ. Dev. Rev. Ref. Bonds (Asbury Maryland Obligated Group), Series 2009-B, 6.00% 2023		1,750		1,952
Howard County Special Obligation Bonds (Annapolis Junction Town Center Project), Series 2014, 6.10% 2044		1,420		1,515
Howard County, G.O. Consolidated Public Improvement Bonds, Series 2009-A, 5.00% 2023		2,970		3,391
City of Hyattsville, Special Obligation Bonds (University Town Center Project), Series 2004, 5.75% 2034		3,650		3,690
Montgomery County Housing Opportunities Commission, Multi-family Housing Dev. Bonds, Series 2004-A, 4.65% 2030		2,670		2,672
Montgomery County Housing Opportunities Commission, Multi-family Housing Dev. Bonds, Series 2007-A, AMT, 4.55% 2027		2,000		2,042

8	The American Funds Tax-Exempt Series I

	Principal amount		Value
	(000)		(000)
Montgomery County Housing Opportunities Commission, Multi-family Housing Dev. Bonds, Series 2007-A, AMT, 4.625% 2032	$	765	$	769
Montgomery County Housing Opportunities Commission, Multi-family Housing Dev. Bonds, Series 2007-A, AMT, 4.70% 2037		1,350		1,356
Montgomery County Housing Opportunities Commission, Single-family Housing Rev. Bonds, Series 2013-A, 4.00% 2031		3,035		3,240
Montgomery County Housing Opportunities Commission, Single-family Housing Rev. Ref. Bonds, Series 2012-A, 5.00% 2043		820		912
Montgomery County Housing Opportunities Commission, Single-family Mortgage Rev. Bonds, Series 2007-D, AMT, 5.50% 2038		110		112
Montgomery County, G.O. Consolidated Public Improvement Bonds, Series 2007-A, 5.00% 2020 (preref. 2017)		1,000		1,076
Montgomery County, G.O. Consolidated Public Improvement Bonds, Series 2008-A, 5.00% 2018		3,000		3,366
Montgomery County, Rev. Bonds (Dept. of Liquor Control), Series 2009-A, 5.00% 2026		3,010		3,343
Montgomery County, Rev. Bonds (Dept. of Liquor Control), Series 2009-A, 5.00% 2027		1,475		1,635
Montgomery County, Rev. Bonds (Dept. of Liquor Control), Series 2009-A, 5.00% 2028		1,515		1,671
Prince George’s County, G.O. Consolidated Public Improvement Bonds, Series 2007-A, 5.00% 2021 (preref. 2017)		2,000		2,170
Prince George’s County, G.O. Consolidated Public Improvement Ref. Bonds, Series 2007-B, 5.00% 2017		945		1,026
Prince George’s County, Special Obligation Bonds (National Harbor Project), Series 2004, 5.20% 2034		5,500		5,504
Prince George’s County, Special Obligation Bonds (Woodview Village Infrastructure Improvements), Series 1997-A, 4.50% 2017		725		748
Prince George’s County, Special Obligation Bonds (Woodview Village Infrastructure Improvements), Series 1997-A, 4.60% 2021		1,660		1,711
Prince George’s County, Special Obligation Bonds (Woodview Village Infrastructure Improvements), Series 1997-A, 4.70% 2026		1,545		1,594
Prince George’s County, Special Tax Dist. Bonds (Victoria Falls Project), Series 2005, 5.25% 2035		3,495		3,511
Washington Suburban Sanitary Dist., Montgomery and Prince George’s Counties, Consolidated Public Improvement Bonds, Series 2009-A, 4.00% 2019		2,305		2,562
Washington Suburban Sanitary Dist., Montgomery and Prince George’s Counties, Consolidated Public Improvement Bonds, Series 2014-2, 4.00% 2029		1,875		2,047
Washington Suburban Sanitary Dist., Montgomery and Prince George’s Counties, G.O. Ref. Bonds of 1997, 5.75% 2017		1,510		1,653
Mayor and Common Council of Westminster, Project and Rev. Ref. Bonds (Carroll Lutheran Village, Inc.), Series 2014, 5.125% 2040		2,250		2,345
Other securities				15,820

				110,199

District of Columbia 1.44%
Metropolitan Area Transit Auth., Gross Rev. Ref. Transit Bonds, Series 2009-A, 5.25% 2025		2,000		2,271
Metropolitan Area Transit Auth., Gross Rev. Ref. Transit Bonds, Series 2009-A, 5.25% 2028		2,000		2,255
				4,526

Guam 2.88%
Waterworks Auth., Water and Wastewater System Rev. Bonds, Series 2013, 5.50% 2043		2,000		2,264
Other securities				6,801
				9,065

Puerto Rico 6.56%
Highways and Transportation Auth., Transportation Rev. Ref. Bonds, Series 2007-N, Assured Guaranty insured, 5.25% 2034		2,500		2,425
Highways and Transportation Auth., Transportation Rev. Ref. Bonds, Series 2002-D, Assured Guaranty Municipal insured, 5.00% 2032		1,750		1,665
Highways and Transportation Auth., Transportation Rev. Ref. Bonds, Series 2007-N, Assured Guaranty insured, 5.25% 2036		1,175		1,135
Industrial, Tourist, Educational, Medical and Environmental Control Facs. Fncg. Auth., Hospital Rev. and Rev. Ref. Bonds (Hospital Auxilio Mutuo Obligated Group Project), Series 2011-A, 6.00% 2033		2,300		2,259
Public Fin. Corp., Commonwealth Appropriation Bonds, Series 2001-E, 6.00% 2026 (escrowed to maturity)		2,455		3,191
Public Fin. Corp., Commonwealth Appropriation Bonds, Series 2001-E, 6.00% 2026 (escrowed to maturity)		45		59
Other securities				9,894

				20,628

The American Funds Tax-Exempt Series I

The Tax-Exempt Fund of Maryland

Bonds, notes & other debt instruments (continued)	Principal amount (000)		Value (000)
Virgin Islands 0.18%
Other securities			$	558

Total bonds, notes & other debt instruments (cost: $290,807,000)				300,981

Short-term securities 3.51%
Baltimore County, G.O. Bonds, 1.25% 4/1/2016	$	2,800		2,821
Baltimore County, G.O. Bonds, 1.25% 4/1/2016		2,200		2,217
Health and Higher Educational Facs. Auth., Rev. Ref. Bonds (University of Maryland Medical System Issue), Series 2008-D, TD Bank LOC, 0.01% 2041²		1,800		1,800
Montgomery County, Consolidated Public Improvement Bond Anticipation Notes, Series 2006-A, 0.01% 2026²		400		400
Montgomery County, Consolidated Public Improvement Bond Anticipation Notes, Series 2006-B, 0.01% 2026²		3,800		3,800

Total short-term securities (cost: $11,035,000)				11,038
Total investment securities 99.23% (cost: $301,842,000)				312,019
Other assets less liabilities 0.77%				2,428

Net assets 100.00%			$	314,447

This summary investment portfolio is designed to streamline the report and help investors better focus on the fund’s principal holdings. See the inside back cover for details on how to obtain a complete schedule of portfolio holdings.

“Other securities” includes all issues that are not disclosed separately in the summary investment portfolio.

¹	Acquired in a transaction exempt from registration under Rule 144A of the Securities Act of 1933. May be resold in the U.S. in transactions exempt from registration, normally to qualified institutional buyers. The total value of all such securities was $2,599,000, which represented .83% of the net assets of the fund.
²	Coupon rate may change periodically. For short-term securities, the date of the next scheduled coupon rate change is considered to be the maturity date.

Key to abbreviations

Agcy. = Agency

AMT = Alternative Minimum Tax

Auth. = Authority

Certs. of Part. = Certificates of Participation

Dept. = Department

Dev. = Development

Dist. = District

Econ. = Economic

Fac. = Facility

Facs. = Facilities

Fin. = Finance

Fncg. = Financing

G.O. = General Obligation

LOC = Letter of credit

Preref. = Prerefunded

Redev. = Redevelopment

Ref. = Refunding

Rev. = Revenue

TECP = Tax-Exempt Commercial Paper

See Notes to Financial Statements

10	The American Funds Tax-Exempt Series I

The Tax-Exempt Fund of Maryland

Financial statements

Statement of assets and liabilities
at July 31, 2015	(dollars in thousands)

Assets:
Investment securities, at value (cost: $301,842)				$	312,019
Cash					224
Receivables for:
Sales of fund’s shares	$	207
Interest		2,758
Other		8			2,973
					315,216
Liabilities:
Payables for:
Repurchases of fund’s shares		346
Dividends on fund’s shares		115
Investment advisory services		91
Services provided by related parties		100
Trustees’ deferred compensation		117
Other		—	*		769
Net assets at July 31, 2015				$	314,447

Net assets consist of:
Capital paid in on shares of beneficial interest				$	311,831
Undistributed net investment income					41
Accumulated net realized loss					(7,602	)
Net unrealized appreciation					10,177
Net assets at July 31, 2015				$	314,447

(dollars and shares in thousands, except per-share amounts)

Shares of beneficial interest issued and outstanding (no stated par value) —
unlimited shares authorized (19,885 total shares outstanding)

	Net assets		Shares outstanding		Net asset value per share
Class A	$	244,778		15,479	$	15.81
Class B		385		24		15.81
Class C		28,550		1,806		15.81
Class F-1		16,475		1,042		15.81
Class F-2		24,259		1,534		15.81

*	Amount less than one thousand.

See Notes to Financial Statements

The American Funds Tax-Exempt Series I

The Tax-Exempt Fund of Maryland

Financial statements

Statement of operations
for the year ended July 31, 2015	(dollars in thousands)

Investment income:
Income:
Interest			$	12,514
*Fees and expenses:**
Investment advisory services	$	1,101
Distribution services		976
Transfer agent services		130
Administrative services		59
Reports to shareholders		35
Registration statement and prospectus		14
Trustees’ compensation		45
Auditing and legal		53
Custodian		1
State and local taxes		2
Other		14		2,430
Net investment income				10,084

Net realized loss and unrealized depreciation:
Net realized loss on investments				(1,789	)
Net unrealized depreciation on investments				(1,336	)
Net realized loss and unrealized depreciation				(3,125	)

Net increase in net assets resulting from operations			$	6,959

*	Additional information related to class-specific fees and expenses is included in the Notes to Financial Statements.

Statements of changes in net assets
	(dollars in thousands)

	Year ended July 31
	2015			2014
Operations:
Net investment income	$	10,084		$	10,208
Net realized loss		(1,789	)		(2,265	)
Net unrealized (depreciation) appreciation		(1,336	)		6,773
Net increase in net assets resulting from operations		6,959			14,716

Dividends paid or accrued to shareholders from net investment income		(9,953	)		(10,287	)

Net capital share transactions		(553	)		(35,358	)

Total decrease in net assets		(3,547	)		(30,929	)

Net assets:
Beginning of year		317,994			348,923
End of year (including undistributed (distributions in excess of) net investment income: $41 and $(58), respectively)	$	314,447		$	317,994

See Notes to Financial Statements

12	The American Funds Tax-Exempt Series I

The Tax-Exempt Fund of Virginia

Summary investment portfolio July 31, 2015

Portfolio quality summary*

Percent of net assets

Bonds, notes & other debt instruments 92.31%	Principal amount (000)		Value (000)
Virginia 78.13%

State issuers 32.49%
College Building Auth., Educational Facs. Rev. Bonds (21st Century College and Equipment Programs), Series 2009-A, 5.00% 2029	$	1,000	$	1,119
College Building Auth., Educational Facs. Rev. Bonds (21st Century College and Equipment Programs), Series 2012-A, 5.00% 2023		2,000		2,382
College Building Auth., Educational Facs. Rev. Bonds (Liberty University Projects), Series 2010, 5.25% 2029		2,000		2,288
College Building Auth., Educational Facs. Rev. Bonds (Public Higher Education Fncg. Program), Series 2009-A, 5.00% 2016		680		715
College Building Auth., Educational Facs. Rev. Bonds (Public Higher Education Fncg. Program), Series 2009-A, 5.00% 2016 (escrowed to maturity)		5		5
College Building Auth., Educational Facs. Rev. Bonds (Public Higher Education Fncg. Program), Series 2009-A, 5.00% 2020		990		1,106
College Building Auth., Educational Facs. Rev. Bonds (Public Higher Education Fncg. Program), Series 2009-A, 5.00% 2020 (preref. 2018)		10		11
College Building Auth., Educational Facs. Rev. Bonds (Public Higher Education Fncg. Program), Series 2009-A, 5.00% 2028		2,480		2,735
College Building Auth., Educational Facs. Rev. Bonds (Public Higher Education Fncg. Program), Series 2009-A, 5.00% 2028 (preref. 2018)		20		22
College Building Auth., Educational Facs. Rev. Ref. Bonds (21st Century College and Equipment Programs), Series 2009-E-2, 5.00% 2023		3,000		3,596
College Building Auth., Educational Facs. Rev. Ref. Bonds (Public Higher Education Fncg. Program), Series 2014, 5.00% 2044		2,385		2,697
College Building Auth., Educational Facs. Rev. Ref. Bonds (Public Higher Education Fncg. Program), Series 2014-B, 5.00% 2024		2,000		2,440
College Building Auth., Educational Facs. Rev. Ref. Bonds (Public Higher Education Fncg. Program), Series 2014, 5.00% 2025		4,710		5,717
Commonwealth Transportation Board, Federal Transportation Grant Anticipation Rev. Notes, Series 2012-A, 5.00% 2027		1,000		1,150
Commonwealth Transportation Board, Federal Transportation Grant Anticipation Rev. Notes, Series 2012-B, 5.00% 2023		1,545		1,841
Commonwealth Transportation Board, Federal Transportation Grant Anticipation Rev. Notes, Series 2012-B, 5.00% 2024		1,000		1,183
Commonwealth Transportation Board, Transportation Capital Projects Rev. Bonds, Series 2011, 5.00% 2025		1,500		1,749
Commonwealth Transportation Board, Transportation Rev. Ref. Bonds, Series 2012-A, 5.00% 2021		2,000		2,368
Port Auth., Port Facs. Rev. Ref. Bonds, Series 2007, AMT, Assured Guaranty Municipal insured, 5.00% 2027		1,000		1,042
Port Auth., Port Facs. Rev. Ref. Bonds, Series 2010, 5.00% 2030		2,970		3,324
Port Auth., Port Facs. Rev. Ref. Bonds, Series 2010, 5.00% 2040		1,000		1,111
Port Auth., Port Facs. Rev. Ref. Bonds, AMT, 5.00% 2039		1,000		1,120

The American Funds Tax-Exempt Series I

The Tax-Exempt Fund of Virginia

Bonds, notes & other debt instruments (continued)	Principal amount (000)		Value (000)
Virginia (continued)

State issuers (continued)
Port Auth., Port Facs. Rev. Ref. Bonds, AMT, 5.00% 2040	$	2,000	$	2,237
Public Building Auth., Public Facs. Rev. Bonds, Series 2005-C, 5.00% 2015		1,000		1,000
Public Building Auth., Public Facs. Rev. Bonds, Series 2009-B, 5.00% 2024		2,000		2,278
Public Building Auth., Public Facs. Rev. Bonds, Series 2009-B, 5.00% 2027		2,000		2,252
Public Building Auth., Public Facs. Rev. Bonds, Series 2015-B, 5.00% 2026		1,140		1,385
Public Building Auth., Public Facs. Rev. Bonds, Series 2014-A, 5.00% 2027		2,000		2,373
Public Building Auth., Public Facs. Rev. Bonds, Series 2014-C, 5.00% 2024		3,000		3,656
Public School Auth., School Fncg. Bonds (1997 Resolution), Series 2005-D, 5.00% 2018 (preref. 2015)		15		15
Public School Auth., School Fncg. Bonds (1997 Resolution), Series 2008-B, 5.25% 2021		1,055		1,191
Public School Auth., School Fncg. Bonds (1997 Resolution), Series 2008-B, 5.25% 2023		1,000		1,129
Public School Auth., School Fncg. Bonds (1997 Resolution), Series D, 5.00% 2018 (preref. 2015)		1,985		1,985
Public School Auth., School Fncg. Rev. Ref. Bonds (1997 Resolution), Series 2005-A, 5.25% 2017		1,000		1,091
Public School Auth., School Fncg. Rev. Ref. Bonds (1997 Resolution), Series 2005-B, 5.25% 2017		1,000		1,091
Public School Auth., School Fncg. Rev. Ref. Bonds (1997 Resolution), Series 2009-A, 5.00% 2019		1,000		1,151
Public School Auth., School Fncg. Rev. Ref. Bonds (1997 Resolution), Series 2009-C, 5.00% 2018		800		897
Public School Auth., School Fncg. Rev. Ref. Bonds (1997 Resolution), Series 2009-C, 5.00% 2020		1,000		1,143
Public School Auth., School Fncg. Rev. Ref. Bonds (1997 Resolution), Series 2009-C, 5.00% 2022		2,000		2,278
Resources Auth., Clean Water State Revolving Fund Rev. Bonds, Series 2007, 4.75% 2021 (preref. 2017)		2,610		2,838
Resources Auth., Clean Water State Revolving Fund Rev. Bonds, Series 2007, 4.75% 2023 (preref. 2017)		2,500		2,718
Resources Auth., Clean Water State Revolving Fund Rev. Bonds, Series 2008, 5.00% 2028		1,500		1,692
Resources Auth., Clean Water State Revolving Fund Rev. Bonds, Series 2009, 5.00% 2027		1,750		2,029
Resources Auth., Clean Water State Revolving Fund Rev. Bonds, Series 2009, 5.00% 2029		1,500		1,739
Resources Auth., Clean Water State Revolving Fund Rev. Bonds, Series 2009, 5.00% 2030		1,500		1,739
Resources Auth., Infrastructure Rev. Bonds (Pooled Fncg. Program), Series 2006-A, 5.00% 2017		1,145		1,213
Resources Auth., Infrastructure Rev. Bonds (Pooled Fncg. Program), Series 2006-A, 5.00% 2017 (preref. 2016)		545		576
Resources Auth., Infrastructure Rev. Bonds (Pooled Fncg. Program), Series 2006-A, 5.00% 2017 (preref. 2016)		315		333
Resources Auth., Infrastructure Rev. Bonds (Pooled Fncg. Program), Series 2006-A, 5.00% 2017 (preref. 2016)		100		106
Resources Auth., Infrastructure Rev. Bonds (Pooled Fncg. Program), Series 2008-A, 5.00% 2028 (preref. 2018)		555		628
Resources Auth., Infrastructure Rev. Bonds (Pooled Fncg. Program), Series 2008-B, 5.00% 2027 (preref. 2018)		65		74
Resources Auth., Infrastructure Rev. Bonds (Pooled Fncg. Program), Series 2008-B, 5.00% 2028		1,000		1,108
Resources Auth., Infrastructure Rev. Bonds (Pooled Fncg. Program), Series 2009-A, 5.00% 2028		250		286
Resources Auth., Infrastructure Rev. Bonds (Pooled Fncg. Program), Series 2009-A, 5.00% 2028 (preref. 2019)		780		903
Resources Auth., Infrastructure Rev. Bonds (Pooled Fncg. Program), Series 2011-A, 5.00% 2024		1,365		1,606
Resources Auth., Infrastructure Rev. Bonds (Pooled Fncg. Program), Series 2011-A, 5.00% 2024 (preref. 2021)		85		102
Resources Auth., Infrastructure Rev. Bonds (Pooled Fncg. Program), Series 2014-B, 5.00% 2027		1,000		1,197
Resources Auth., Infrastructure Rev. Bonds, Series 2008-B, 5.00% 2020 (preref. 2018)		60		68
Resources Auth., Infrastructure Rev. Bonds, Series 2008-B, 5.00% 2023 (preref. 2018)		145		164
Resources Auth., State Moral Obligation Rev. Ref. Bonds (Pooled Fncg. Program), Series 2011-B, 5.00% 2027		2,000		2,316
Resources Auth., Infrastructure Rev. Bonds (Pooled Fncg. Program), Series 2008-A, 5.00% 2028 (preref. 2018)		680		767
Resources Auth., Infrastructure Rev. Bonds (Pooled Fncg. Program), Series 2008-B, 5.00% 2023 (preref. 2018)		650		735
Resources Auth., Infrastructure Rev. Bonds (Pooled Fncg. Program), Series 2008-B, 5.00% 2027 (preref. 2018)		310		351
Resources Auth., Infrastructure Rev. Bonds (Pooled Fncg. Program), Series 2008-B, 5.00% 2020 (preref. 2018)		245		277
Resources Auth., Infrastructure Rev. Bonds (Pooled Fncg. Program), Series 2008-B, 5.00% 2038 (preref. 2018)		215		243
Resources Auth., Infrastructure Rev. Bonds (Pooled Fncg. Program), Series 2008-A, 5.00% 2028		335		372
Resources Auth., Infrastructure Rev. Bonds (Pooled Fncg. Program), Series 2008-B, 5.00% 2023		1,375		1,533
Resources Auth., Infrastructure Rev. Bonds (Pooled Fncg. Program), Series 2008-B, 5.00% 2038		785		867
Resources Auth., Infrastructure Rev. Bonds (Pooled Fncg. Program), Series 2008-B, 5.00% 2027		625		695
Resources Auth., Infrastructure Rev. Bonds (Pooled Fncg. Program), Series 2008-B, 5.00% 2020		550		616
Resources Auth., Infrastructure Rev. Bonds (Pooled Fncg. Program), 5.00% 2025		1,555		1,931

14	The American Funds Tax-Exempt Series I

	Principal amount (000)		Value (000)
Resources Auth., Infrastructure Rev. Ref. Bonds (Pooled Fncg. Program), Series 2009-B, 5.00% 2027 (preref. 2019)	$	610	$	706
Resources Auth., Infrastructure Rev. Ref. Bonds (Pooled Fncg. Program), Series 2009-B, 5.00% 2027		390		444
Small Business Fncg. Auth., Rev. Bonds (Elizabeth River Crossings Opco, LLC Project), Series 2012, AMT, 5.50% 2042		6,000		6,509
Tobacco Settlement Fncg. Corp., Tobacco Settlement Asset-backed Rev. Ref. Bonds, Series 2007-B-1, 5.00% 2047		4,755		3,308
Rector and Visitors of the University of Virginia, General Rev. Ref. Pledge Bonds, Series 2008, 5.00% 2040		3,000		3,293
Rector and Visitors of the University of Virginia, General Rev. Ref. Pledge Bonds, Series 2011, 5.00% 2030		1,000		1,168
Rector and Visitors of the University of Virginia, General Rev. Ref. Pledge Bonds, Series 2011, 5.00% 2031		1,000		1,162
Upper Occoquan Sewage Auth., Regional Sewerage System Rev. Bonds, 5.00% 2026		4,500		5,529
Upper Occoquan Sewage Auth., Regional Sewerage System Rev. Bonds, 5.00% 2027		2,485		3,033
Upper Occoquan Sewage Auth., Regional Sewerage System Rev. Bonds, Series 2007-B, 4.75% 2034		1,000		1,078
Upper Occoquan Sewage Auth., Regional Sewerage System Rev. Bonds, Series A, Assured Guaranty Municipal insured, 5.15% 2020		1,000		1,119
Western Virginia Regional Jail Auth., Regional Jail Fac. Rev. Bonds, Series 2007, National insured, 4.75% 2024		2,200		2,366
Other securities				23,646
				152,056

City & county issuers 45.64%
Econ. Dev. Auth. of Albemarle County, Public Fac. Rev. Ref. Bonds (Albemarle County Project), Series 2011, 5.00% 2022		2,955		3,440
Industrial Dev. Auth. of the City of Alexandria, Demand Rev. Ref. Bonds (Goodwin House), Series 2015, 5.00% 2045		1,000		1,073
Industrial Dev. Auth. of the City of Alexandria, Demand Rev. Ref. Bonds (Goodwin House), Series 2015, 5.00% 2050		2,000		2,132
Arlington County, G.O. Public Improvement Bonds, Series 2008, 5.00% 2024 (preref. 2017)		1,500		1,597
Arlington County, G.O. Public Improvement Bonds, Series 2008, 5.00% 2025 (preref. 2017)		2,000		2,129
Arlington County, G.O. Ref. Bonds, 5.00% 2018 (preref. 2016)		2,660		2,785
Arlington County, G.O. Ref. Bonds, 5.00% 2018 (preref. 2016)		1,765		1,848
Industrial Dev. Auth. of Arlington County, Hospital Rev. Ref. Bonds (Virginia Hospital Center Arlington Health System), Series 2010, 4.25% 2024		415		441
Industrial Dev. Auth. of Arlington County, Hospital Rev. Ref. Bonds (Virginia Hospital Center Arlington Health System), Series 2010, 5.00% 2031		6,355		6,971
Econ. Dev. Auth. of County of Chesterfield, Rev. Bonds (Bon Secours Health System, Inc.), Series 2008-C, Assured Guaranty insured, 5.00% 2042		2,500		2,730
Fairfax County Econ. Dev. Auth., Lease Rev. Bonds (Joint Public Uses Complex Project), Series 2006, 5.00% 2024 (preref. 2016)		3,795		3,936
Fairfax County Econ. Dev. Auth., Residential Care Facs. Mortgage Rev. Bonds (Goodwin House Incorporated), Series 2007, 5.125% 2037		2,000		2,084
Fairfax County Econ. Dev. Auth., Retirement Community Rev. Ref. Bonds (Greenspring Village, Inc. Fac.), Series 2006-A, 4.875% 2036		2,500		2,531
Fairfax County Industrial Dev. Auth., Health Care Rev. Bonds (Inova Health System Project), Series 2012-A, 5.00% 2035		1,000		1,116
Fairfax County Industrial Dev. Auth., Health Care Rev. Bonds (Inova Health System Project), Series 2012-A, 5.00% 2040		2,000		2,215
Fairfax County Industrial Dev. Auth., Health Care Rev. Bonds (Inova Health System Project), Series 2014-A, 5.00% 2044		2,000		2,222
Fairfax County Industrial Dev. Auth., Health Care Rev. Ref. Bonds (Inova Health System Project), Series 2009-A, 5.25% 2026		1,000		1,133
Fairfax County Industrial Dev. Auth., Health Care Rev. Ref. Bonds (Inova Health System Project), Series 2009-A, 5.50% 2035		3,000		3,352
Fairfax County Industrial Dev. Auth., Health Care Rev. Ref. Bonds (Inova Health System Project), Series 2009-C, 5.00% 2025		1,500		1,687
Fairfax County Industrial Dev. Auth., Hospital Rev. Ref. Bonds (Inova Health System Hospitals Project), Series 1993-A, 5.25% 2019		2,500		2,736
Fairfax County Industrial Dev. Auth., Hospital Rev. Ref. Bonds (Inova Health System Hospitals Project), Series 1993-A, Assured Guaranty Municipal insured, 5.25% 2019		1,000		1,099
Fairfax County Redev. and Housing Auth., Multi-family Housing Rev. Bonds (Cedar Ridge Project), Series 2007, AMT, 4.75% 2038		3,775		3,865
Fairfax County Sewer Rev. Bonds, Series 2012, 5.00% 2021		2,055		2,456
Fairfax County Water Auth., Water Rev. Ref. Bonds, Series 1997, 5.00% 2021		1,000		1,130
Fairfax County Water Auth., Water Rev. Ref. Bonds, Series 2005-B, 5.25% 2019		1,000		1,152
Fairfax County Water Auth., Water Rev. Ref. Bonds, Series 2005-B, 5.25% 2026		1,500		1,915
Fairfax County Water Auth., Water Rev. Ref. Bonds, Series 2007, 5.00% 2017		1,000		1,074

The American Funds Tax-Exempt Series I

The Tax-Exempt Fund of Virginia

Bonds, notes & other debt instruments (continued)	Principal amount (000)		Value (000)
Virginia (continued)

City & county issuers (continued)
Fairfax County Water Auth., Water Rev. Ref. Bonds, Series 2012, 5.00% 2028	$	1,000	$	1,169
Hampton Roads Sanitation Dist., Wastewater Rev. Bonds, Series 2012-A, 5.00% 2020		515		597
Hampton Roads Sanitation Dist., Wastewater Rev. Bonds, Series 2012-A, 5.00% 2039		4,000		4,427
Hampton Roads Sanitation Dist., Wastewater Rev. Ref. Bonds, Series 2008, 5.00% 2025		1,000		1,110
Hampton Roads Sanitation Dist., Wastewater Rev. Ref. Bonds, Series 2008, 5.00% 2033		1,260		1,372
Hampton Roads Sanitation Dist., Wastewater Rev. Ref. Bonds, Series 2008, 5.00% 2033 (preref. 2018)		740		822
Industrial Dev. Auth. of County of Hanover, Hospital Rev. Bonds (Memorial Regional Medical Center Project at Hanover Medical Park), Series 1995, National insured, 6.375% 2018		845		894
Industrial Dev. Auth. of the City of Harrisonburg, Hospital Facs. Rev. Bonds (Rockingham Memorial Hospital), Series 2006, AMBAC insured, 4.00% 2018		1,170		1,205
Econ. Dev. Auth. of Henrico County, Rev. Bonds (Bon Secours Health System, Inc.), Series 2008-B-2, Assured Guaranty insured, 5.25% 2042		2,000		2,219
Henrico County, Water and Sewer System Rev. Bonds, Series 2006-A, 5.00% 2025 (preref. 2016)		2,945		3,050
Henrico County, Water and Sewer System Rev. Ref. Bonds, Series 2009, 5.00% 2024		1,000		1,131
Henrico County, Water and Sewer System Rev. Ref. Bonds, Series 2013, 5.00% 2023		945		1,150
Henrico County, Water and Sewer System Rev. Ref. Bonds, Series 2013, 5.00% 2024		1,000		1,202
Industrial Dev. Auth. of the Town of Louisa, Pollution Control Rev. Ref. Bonds (Virginia Electric and Power Co. Project), Series 2014-C, 0.70% 2035 (put 2016)		500		500
Econ. Dev. Auth. of Montgomery County, Rev. Ref. Bonds (Virginia Tech Foundation), Series 2011-A, 5.00% 2027		2,000		2,285
Econ. Dev. Auth. of Montgomery County, Rev. Ref. Bonds (Virginia Tech Foundation), Series 2011-A, 5.00% 2030		2,000		2,255
Mosaic Dist. Community Dev. Auth. (Fairfax County), Rev. Bonds, Series 2011-A, 6.875% 2036		3,000		3,421
City of Norfolk, Water Rev. Bonds, Series 2008, 5.00% 2027		2,120		2,396
Econ. Dev. Auth. of the City of Norfolk, Health Care Facs. Rev. Ref. Bonds (Sentara Healthcare), Series 2012-B, 5.00% 2036		1,865		2,073
Econ. Dev. Auth. of the City of Norfolk, Health Care Facs. Rev. Ref. Bonds (Sentara Healthcare), Series 2012-B, 5.00% 2043		1,500		1,653
Industrial Dev. Auth. of the County of Prince William, Student Housing Rev. Bonds (George Mason University Foundation Prince William Housing LLC Project), Series 2011-A, 5.125% 2041		3,400		3,712
City of Richmond, Public Utility Rev. Ref. Bonds, Series 2007-A, Assured Guaranty Municipal insured, 4.50% 2022		500		526
City of Richmond, Public Utility Rev. Ref. Bonds, Series 2009-A, 5.00% 2027		1,000		1,116
City of Richmond, Public Utility Rev. Ref. Bonds, Series 2009-A, 5.00% 2035		1,800		1,982
City of Richmond, Public Utility Rev. Ref. Bonds, Series 2013-A, 5.00% 2027		1,000		1,168
Greater Richmond Convention Center Auth., Hotel Tax Rev. Ref. Bonds, Series 2015, 5.00% 2026		2,520		2,995
Small Business Fncg. Auth., Health Care Facs. Rev. Ref. Bonds (Sentara Healthcare), Series 2010, 5.00% 2040		7,500		8,299
City of Spotsylvania, Water and Sewer System Rev. Ref. Bonds, 5.00% 2026		3,000		3,648
Industrial Dev. Auth. of Washington County, Hospital Rev. Ref. Bonds (Mountain States Health Alliance), Series 2009-C, 7.75% 2038		2,000		2,297
Industrial Dev. Auth. of the City of Winchester, Hospital Rev. Ref. Bonds (Valley Health System Obligated Group), 5.00% 2044		2,000		2,181
Industrial Dev. Auth. of the City of Winchester, Hospital Rev. Ref. Bonds (Valley Health System Obligated Group), 5.00% 2035		1,000		1,109
Industrial Dev. Auth. of the City of Winchester, Hospital Rev. Ref. Bonds (Valley Health System Obligated Group), Series 2014-A, 5.00% 2044		2,000		2,189
Industrial Dev. Auth. of Wise County, Solid Waste and Sewage Disposal Rev. Bonds (Virginia Electric and Power Co. Project), Series 2010-A, 2.375% 2040 (put 2015)		3,000		3,015
Econ. Dev. Auth. of York County, Pollution Control Rev. Ref. Bonds (Virginia Electric and Power Co. Project), Series 2009-A, 4.05% 2033 (put 2019)		3,000		3,054
Other securities				80,530
				213,601

District of Columbia 6.25%
Dulles Toll Road, Rev. Bonds (Dulles Metrorail and Capital Improvement Projects), Convertible Capital Appreciation Bonds, Series 2010-B, 0%/6.50% 2044¹		2,000		2,108
Dulles Toll Road, Rev. Bonds (Dulles Metrorail and Capital Improvement Projects), Current Interest Bonds, Series 2009-A, 5.00% 2039		4,000		4,371
Dulles Toll Road, Rev. Bonds (Dulles Metrorail and Capital Improvement Projects), Current Interest Bonds, Series 2009-A, 5.25% 2044		3,000		3,348
Metropolitan Washington Airports Auth., Airport System Rev. Bonds, Series 2007-B, AMT, AMBAC insured, 5.00% 2020		1,000		1,085

16	The American Funds Tax-Exempt Series I

	Principal amount (000)		Value (000)
Metropolitan Washington Airports Auth., Airport System Rev. Bonds, Series 2008-A, AMT, 5.375% 2028	$	1,825	$	2,015
Metropolitan Washington Airports Auth., Airport System Rev. Bonds, Series 2010-A, 5.00% 2039		1,800		2,041
Metropolitan Washington Airports Auth., Airport System Rev. Ref. Bonds, Series 2005-A, AMT, National insured, 5.25% 2017		1,000		1,008
Metropolitan Washington Airports Auth., Airport System Rev. Ref. Bonds, Series 2006-A, AMT, Assured Guaranty Municipal insured, 5.00% 2032		1,000		1,046
Metropolitan Washington Airports Auth., Airport System Rev. Ref. Bonds, Series 2006-C, FGIC-National insured, 5.00% 2023		1,965		2,071
Metropolitan Washington Airports Auth., Airport System Rev. Ref. Bonds, Series 2010-B, AMT, 5.00% 2025		1,000		1,127
Metropolitan Washington Airports Auth., Airport System Rev. Ref. Bonds, Series 2011-C, AMT, 5.00% 2026		3,000		3,382
Metropolitan Washington Airports Auth., Airport System Rev. Ref. Bonds, Series 2012-A, AMT, 5.00% 2031		1,000		1,104
Metropolitan Washington Airports Auth., Airport System Rev. Ref. Bonds, Series 2015-B, AMT, 5.00% 2027		1,000		1,157
Other securities				3,398
				29,261

Guam 2.96%
Waterworks Auth., Water and Wastewater System Rev. Bonds, Series 2013, 5.50% 2043		2,500		2,830
Other securities				11,037
				13,867

Puerto Rico 4.85%
Highways and Transportation Auth., Transportation Rev. Ref. Bonds, Series 2007-N, Assured Guaranty insured, 5.25% 2034		1,750		1,697
Highways and Transportation Auth., Transportation Rev. Ref. Bonds, Series 2002-D, Assured Guaranty Municipal insured, 5.00% 2032		2,250		2,141
Highways and Transportation Auth., Transportation Rev. Ref. Bonds, Series 2007-N, Assured Guaranty insured, 5.25% 2036		2,175		2,101
Industrial, Tourist, Educational, Medical and Environmental Control Facs. Fncg. Auth., Hospital Rev. and Rev. Ref. Bonds (Hospital Auxilio Mutuo Obligated Group Project), Series 2011-A, 6.00% 2033		2,950		2,898
Other securities				13,838
				22,675

Virgin Islands 0.12%
Other securities				558
Total bonds, notes & other debt instruments (cost: $415,686,000)				432,018

Short-term securities 8.24%
Virginia College Building Auth., Educational Facs. Rev. Bonds (21st Century College and Equipment Programs), Series 2006-B, 0.08% 2026²		5,180		5,180
Virginia College Building Auth., Educational Facs. Rev. Bonds (21st Century College and Equipment Programs), Series 2006-C, 0.01% 2026²		7,585		7,585
Virginia College Building Auth., Educational Facs. Rev. Bonds (University of Richmond Project), Series 2006, 0.08% 2036²		13,955		13,955
Industrial Dev. Auth. of Loudoun County, Multi-Modal Rev. Bonds (Howard Hughes Medical Institute Issue), Series 2003-A, 0.06% 2038²		5,000		5,000
Industrial Dev. Auth. of Montgomery County, Rev. Ref. Bonds (Virginia Tech Foundation), Series 2005-A, Bank of America LOC, 0.01% 2035²		980		980
Econ. Dev. Auth. of Albemarle County, Virginia, Health Services Rev. Bonds (University of Virginia Health Services Foundation), Series 2009, Bank of America LOC, 0.02% 2039²		185		185
Norfolk Redev. and Housing Auth., Demand Rev. and Ref. Bonds (Old Dominion University Real Estate Foundation Student Housing, LLC University Village Student Housing Project), Series 2008, 0.15% 2033²		3,200		3,200
Other securities				2,455

Total short-term securities (cost: $38,540,000)				38,540
Total investment securities 100.55% (cost: $454,226,000)				470,558
Other assets less liabilities (0.55)%				(2,569	)

Net assets 100.00%			$	467,989

The American Funds Tax-Exempt Series I

The Tax-Exempt Fund of Virginia

“Other securities” includes all issues that are not disclosed separately in the summary investment portfolio.

¹	Step bond; coupon rate will increase at a later date.
²	Coupon rate may change periodically. For short-term securities, the date of the next scheduled coupon rate change is considered to be the maturity date.

Key to abbreviations

Agcy. = Agency

AMT = Alternative Minimum Tax

Auth. = Authority

Certs. of Part. = Certificates of Participation

Dept. = Department

Dev. = Development

Dist. = District

Econ. = Economic

Fac. = Facility

Facs. = Facilities

Fin. = Finance

Fncg. = Financing

G.O. = General Obligation

LOC = Letter of credit

Preref. = Prerefunded

Redev. = Redevelopment

Ref. = Refunding

Rev. = Revenue

TECP = Tax-Exempt Commercial Paper

See Notes to Financial Statements

18	The American Funds Tax-Exempt Series I

The Tax-Exempt Fund of Virginia

Financial statements

Statement of assets and liabilities
at July 31, 2015	(dollars in thousands)

Assets:
Investment securities, at value (cost: $454,226)				$	470,558
Cash					737
Receivables for:
Sales of fund’s shares	$	458
Interest		5,061
Other		6			5,525
					476,820
Liabilities:
Payables for:
Purchases of investments		6,638
Repurchases of fund’s shares		1,702
Dividends on fund’s shares		102
Investment advisory services		131
Services provided by related parties		141
Trustees’ deferred compensation		117
Other		—	*		8,831
Net assets at July 31, 2015				$	467,989

Net assets consist of:
Capital paid in on shares of beneficial interest				$	455,573
Undistributed net investment income					445
Accumulated net realized loss					(4,361	)
Net unrealized appreciation					16,332
Net assets at July 31, 2015				$	467,989

(dollars and shares in thousands, except per-share amounts)

Shares of beneficial interest issued and outstanding (no stated par value) —
unlimited shares authorized (27,977 total shares outstanding)

	Net assets		Shares outstanding		Net asset value per share
Class A	$	361,105		21,588	$	16.73
Class B		525		31		16.73
Class C		34,515		2,063		16.73
Class F-1		21,256		1,271		16.73
Class F-2		50,588		3,024		16.73

*	Amount less than one thousand.

See Notes to Financial Statements

The American Funds Tax-Exempt Series I

The Tax-Exempt Fund of Virginia

Financial statements

Statement of operations
for the year ended July 31, 2015	(dollars in thousands)

Investment income:
Income:
Interest				$	17,610
*Fees and expenses:**
Investment advisory services	$	1,562
Distribution services		1,321
Transfer agent services		188
Administrative services		88
Reports to shareholders		37
Registration statement and prospectus		10
Trustees’ compensation		45
Auditing and legal		53
Custodian		1
State and local taxes		—	^†
Other		15			3,320
Net investment income					14,290

Net realized loss and unrealized depreciation:
Net realized loss on investments					(1,264	)
Net unrealized depreciation on investments					(2,182	)
Net realized loss and unrealized depreciation					(3,446	)

Net increase in net assets resulting from operations				$	10,844

*	Additional information related to class-specific fees and expenses is included in the Notes to Financial Statements.
^†	Amount less than one thousand.

Statements of changes in net assets
	(dollars in thousands)

	Year ended July 31
	2015			2014
Operations:
Net investment income	$	14,290		$	14,391
Net realized loss		(1,264	)		(2,699	)
Net unrealized (depreciation) appreciation		(2,182	)		12,124
Net increase in net assets resulting from operations		10,844			23,816

Dividends paid or accrued to shareholders from net investment income		(14,041	)		(14,312	)

Net capital share transactions		12,098			(32,394	)

Total increase (decrease) in net assets		8,901			(22,890	)

Net assets:
Beginning of year		459,088			481,978
End of year (including undistributed net investment income: $445 and $264, respectively)	$	467,989		$	459,088

See Notes to Financial Statements

20	The American Funds Tax-Exempt Series I

Notes to financial statements

1. Organization

The American Funds Tax-Exempt Series I (the “trust”) is registered under the Investment Company Act of 1940 as an open-end, diversified management investment company and has issued two series of shares, The Tax-Exempt Fund of Maryland (the “Maryland fund”) and The Tax-Exempt Fund of Virginia (the “Virginia fund,” and, together with the Maryland fund, the “funds”). Each fund seeks to provide a high level of current income exempt from regular federal and its respective state income taxes. Each fund’s secondary objective is preservation of capital.

Each fund has five retail share classes (Classes A, B and C, as well as two F share classes, F-1 and F-2). Some share classes are available only to limited categories of investors. The funds’ share classes are further described below:

Share class	Initial sales charge	Contingent deferred sales charge upon redemption	Conversion feature
Class A	Up to 3.75%	None (except 1% for certain redemptions within one year of purchase without an initial sales charge)	None
Class B*	None	Declines from 5% to 0% for redemptions within six years of purchase	Class B converts to Class A after eight years
Class C	None	1% for redemptions within one year of purchase	Class C converts to Class F-1 after 10 years
Classes F-1 and F-2	None	None	None

*Class B shares of the funds are not available for purchase.

Holders of all share classes of each fund have equal pro rata rights to the assets, dividends and liquidation proceeds of each fund of the fund. Each share class of each fund has identical voting rights, except for the exclusive right to vote on matters affecting only its class. Share classes have different fees and expenses (“class-specific fees and expenses”), primarily due to different arrangements for distribution, transfer agent and administrative services. Differences in class-specific fees and expenses will result in differences in net investment income and, therefore, the payment of different per-share dividends by each share class of each fund.

2. Significant accounting policies

Each fund is an investment company that applies the accounting and reporting guidance issued in Topic 946 by the U.S. Financial Accounting Standards Board. Each fund’s financial statements have been prepared to comply with U.S. generally accepted accounting principles (“U.S. GAAP”). These principles require the funds’ investment adviser to make estimates and assumptions that affect reported amounts and disclosures. Actual results could differ from those estimates. Subsequent events, if any, have been evaluated through the date of issuance in the preparation of the financial statements. The funds follow the significant accounting policies described in this section, as well as the valuation policies described in the next section on valuation.

Security transactions and related investment income — Security transactions are recorded by the funds as of the date the trades are executed with brokers. Realized gains and losses from security transactions are determined based on the specific identified cost of the securities. In the event a security is purchased with a delayed payment date, the funds will segregate liquid assets sufficient to meet their payment obligations. Interest income is recognized on an accrual basis. Market discounts, premiums and original issue discounts on fixed-income securities are amortized daily over the expected life of the security.

Class allocations — Income, fees and expenses (other than class-specific fees and expenses) are allocated daily among the various share classes of each fund based on the relative value of their settled shares. Realized and unrealized gains and losses are allocated daily among the various share classes of each fund based on their relative net assets. Class-specific fees and expenses, such as distribution, transfer agent and administrative services, are charged directly to the respective share class of each fund.

Dividends and distributions to shareholders — Dividends to shareholders are declared daily after the determination of each fund’s net investment income and are paid to shareholders monthly. Distributions to shareholders are recorded on each fund’s ex-dividend date.

The American Funds Tax-Exempt Series I

3. Valuation

Capital Research and Management Company (“CRMC”), the funds’ investment adviser, values the funds’ investments at fair value as defined by U.S. GAAP. The net asset value of each share class of each fund is generally determined as of approximately 4:00 p.m. New York time each day the New York Stock Exchange is open.

Methods and inputs — The funds’ investment adviser uses the following methods and inputs to establish the fair value of the funds’ assets and liabilities. Use of particular methods and inputs may vary over time based on availability and relevance as market and economic conditions evolve.

Fixed-income securities, including short-term securities, are generally valued at prices obtained from one or more pricing vendors. Vendors value such securities based on one or more of the following inputs: benchmark yields, transactions, bids, offers, quotations from dealers and trading systems, new issues, spreads and other relationships observed in the markets among comparable securities; and proprietary pricing models such as yield measures calculated using factors such as cash flows, financial or collateral performance and other reference data. For certain distressed securities, valuations may include cash flows or liquidation values using a net present value calculation based on inputs that include, but are not limited to, financial statements and debt contracts.

When the funds’ investment adviser deems it appropriate to do so (such as when vendor prices are unavailable or deemed to be not representative), fixed-income securities will be valued in good faith at the mean quoted bid and ask prices that are reasonably and timely available (or bid prices, if ask prices are not available) or at prices for securities of comparable maturity, quality and type.

Securities and other assets for which representative market quotations are not readily available or are considered unreliable by the funds’ investment adviser are fair valued as determined in good faith under fair valuation guidelines adopted by authority of the trust’s board of trustees as further described. The investment adviser follows fair valuation guidelines, consistent with U.S. Securities and Exchange Commission rules and guidance, to consider relevant principles and factors when making fair value determinations. The investment adviser considers relevant indications of value that are reasonably and timely available to it in determining the fair value to be assigned to a particular security, such as the type and cost of the security; contractual or legal restrictions on resale of the security; relevant financial or business developments of the issuer; actively traded similar or related securities; conversion or exchange rights on the security; related corporate actions; significant events occurring after the close of trading in the security; and changes in overall market conditions. In addition, the closing prices of equity securities that trade in markets outside U.S. time zones may be adjusted to reflect significant events that occur after the close of local trading but before the net asset value of each share class of the fund is determined. Fair valuations and valuations of investments that are not actively trading involve judgment and may differ materially from valuations that would have been used had greater market activity occurred.

Processes and structure — The trust’s board of trustees has delegated authority to the funds’ investment adviser to make fair value determinations, subject to board oversight. The investment adviser has established a Joint Fair Valuation Committee (the “Fair Valuation Committee”) to administer, implement and oversee the fair valuation process, and to make fair value decisions. The Fair Valuation Committee regularly reviews its own fair value decisions, as well as decisions made under its standing instructions to the investment adviser’s valuation teams. The Fair Valuation Committee reviews changes in fair value measurements from period to period and may, as deemed appropriate, update the fair valuation guidelines to better reflect the results of back testing and address new or evolving issues. The Fair Valuation Committee reports any changes to the fair valuation guidelines to the board of trustees with supplemental information to support the changes. The trust’s board and audit committee also regularly review reports that describe fair value determinations and methods.

The funds’ investment adviser has also established a Fixed-Income Pricing Review Group to administer and oversee the fixed-income valuation process, including the use of fixed-income pricing vendors. This group regularly reviews pricing vendor information and market data. Pricing decisions, processes and controls over security valuation are also subject to additional internal reviews, including an annual control self-evaluation program facilitated by the investment adviser’s compliance group.

Classifications — The funds’ investment adviser classifies the funds’ assets and liabilities into three levels based on the inputs used to value the assets or liabilities. Level 1 values are based on quoted prices in active markets for identical securities. Level 2 values are based on significant observable market inputs, such as quoted prices for similar securities and quoted prices in inactive markets. Certain securities trading outside the U.S. may transfer between Level 1 and Level 2 due to valuation adjustments resulting from significant market movements following the close of local trading. Level 3 values are based on significant unobservable inputs that reflect the investment adviser’s determination of assumptions that market participants might reasonably use in valuing the securities. The valuation levels are

22	The American Funds Tax-Exempt Series I

not necessarily an indication of the risk or liquidity associated with the underlying investment. For example, U.S. government securities are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market. At July 31, 2015, all of the investment securities held by each fund were classified as Level 2.

4. Risk factors

Investing in each fund may involve certain risks including, but not limited to, those described below.

Risks of investing in municipal bonds issued in the state of Maryland or Virginia — Because the funds invest primarily in securities of issuers in the state of Maryland or Virginia, the funds are more susceptible to factors adversely affecting issuers of the respective state’s securities than a comparable municipal bond mutual fund that does not concentrate its investments in a single state. Both states are affected by changes in levels of federal funding and financial support of certain industries, as well as by federal spending cutbacks due to the large number of residents who are employed by the federal government. In addition, each state is dependent on certain economic sectors. Maryland’s economy is largely dependent on the government, education, health services, retail trade, finance, insurance and real estate sectors. Virginia’s economy is largely dependent on the government and service sectors, manufacturing, wholesale and retail trade, financial services, insurance and real estate. To the extent there are changes to any of these sectors, the funds may be adversely impacted.

Market conditions — The prices of, and the income generated by, the securities held by the funds may decline - sometimes rapidly or unpredictably - due to various factors, including events or conditions affecting the general economy or particular industries; overall market changes; local, regional or global political, social or economic instability; governmental or governmental agency responses to economic conditions; and currency exchange rate, interest rate and commodity price fluctuations.

Issuer risks — The prices of, and the income generated by, securities held by the funds may decline in response to various factors directly related to the issuers of such securities, including reduced demand for an issuer’s goods or services, poor management performance and strategic initiatives such as mergers, acquisitions or dispositions and the market response to any such initiatives.

Investing in municipal securities — The yield and/or value of each fund’s investments in municipal securities may be adversely affected by events tied to the municipal securities markets, which can be very volatile and significantly impacted by unfavorable legislative or political developments and negative changes in the financial conditions of municipal securities issuers and the economy. To the extent the fund invests in obligations of a municipal issuer, the volatility, credit quality and performance of the fund may be adversely impacted by local political and economic conditions of the issuer. For example, a credit rating downgrade, bond default or bankruptcy involving an issuer within a particular state or territory could affect the market values and marketability of many or all municipal obligations of that state or territory. Income from municipal securities held by the fund could also be declared taxable because of changes in tax laws or interpretations by taxing authorities or as a result of noncompliant conduct of a municipal issuer. Additionally, the relative amount of publicly available information about municipal securities is generally less than that for corporate securities.

Investing in debt instruments — The prices of, and the income generated by, bonds and other debt instruments held by the funds may be affected by changing interest rates and by changes in the effective maturities and credit ratings of these securities.

Rising interest rates will generally cause the prices of bonds and other debt securities to fall. Falling interest rates may cause an issuer to redeem, call or refinance a debt security before its stated maturity, which may result in a fund having to reinvest the proceeds in lower yielding securities. Longer maturity debt securities generally have greater sensitivity to changes in interest rates and may be subject to greater price fluctuations than shorter maturity debt securities.

Bonds and other debt securities are also subject to credit risk, which is the possibility that the credit strength of an issuer will weaken and/or an issuer of a debt security will fail to make timely payments of principal or interest and the security will go into default. Lower quality debt securities generally have higher rates of interest and may be subject to greater price fluctuations than higher quality debt securities. Credit risk is gauged, in part, by the credit ratings of the debt securities in which a fund invests. However, ratings are only the opinions of the rating agencies issuing them and are not guarantees as to credit quality or an evaluation of market risk. The funds’ investment adviser relies on its own credit analysts to research issuers and issues in seeking to mitigate various credit and default risks.

Credit and liquidity support — Changes in the credit quality of banks and financial institutions providing credit and liquidity support features with respect to securities held by the funds could cause the values of these securities to decline.

Investing in lower rated debt instruments — Lower rated bonds and other lower rated debt securities generally have higher rates of interest and involve greater risk of default or price declines due to changes in the issuer’s creditworthiness than those of higher quality debt securities. The market prices of these securities may fluctuate more than the prices of higher quality debt securities and may decline significantly in periods of general economic difficulty. These risks may be increased with respect to investments in junk bonds.

The American Funds Tax-Exempt Series I

Thinly traded securities — There may be little trading in the secondary market for particular bonds or other debt securities, which may make them more difficult to value, acquire or sell.

Investing in similar municipal bonds — Investing significantly in municipal obligations of issuers in the same state or backed by revenues of similar types of projects or industries may make the funds more susceptible to certain economic, political or regulatory occurrences. As a result, the potential for fluctuations in the funds’ share prices may increase.

Management — The investment adviser to the funds actively manages the funds’ investments. Consequently, the funds are subject to the risk that the methods and analyses employed by the investment adviser in this process may not produce the desired results. This could cause the funds to lose value or their investment results to lag relevant benchmarks or other funds with similar objectives.

5. Taxation and distributions

Federal income taxation — Each fund complies with the requirements under Subchapter M of the Internal Revenue Code applicable to mutual funds and intends to distribute substantially all of its net income and net capital gains each year. The funds are not subject to income taxes to the extent taxable income and net capital gains are distributed. Generally, income earned by each fund is exempt from federal income taxes; however, each fund may earn taxable income from certain investments.

As of and during the period ended July 31, 2015, neither fund had a liability for any unrecognized tax benefits. The funds recognize interest and penalties, if any, related to unrecognized tax benefits as income tax expense in the statement of operations. During the period, neither fund incurred any significant interest or penalties.

The funds are not subject to examination by U.S. federal tax authorities or state tax authorities for tax years before 2011.

Distributions — Distributions paid to shareholders are based on each fund’s net investment income and net realized gains determined on a tax basis, which may differ from net investment income and net realized gains for financial reporting purposes. These differences are due primarily to different treatment for items such as short-term capital gains and losses; capital losses related to sales of certain securities within 30 days of purchase; deferred expenses; net capital losses; and amortization of premium and discounts. The fiscal year in which amounts are distributed may differ from the year in which the net investment income and net realized gains are recorded by the funds for financial reporting purposes.

During the year ended July 31, 2015, the Maryland fund reclassified $12,000 from undistributed net investment income to capital paid in on shares of beneficial interest and $20,000 from undistributed net investment income to accumulated net realized loss to align financial reporting with tax reporting. The Virginia fund reclassified $16,000 from undistributed net investment income to capital paid in on shares of beneficial interest and $52,000 from undistributed net investment income to accumulated net realized loss to align financial reporting with tax reporting.

Under the Regulated Investment Company Modernization Act of 2010 (the “Act”), net capital losses recognized after July 31, 2011, may be carried forward indefinitely, and their character is retained as short-term and/or long-term losses. Previously, net capital losses were carried forward for eight years and treated as short-term losses. As a transition rule, the Act requires that post-enactment net capital losses be used before pre-enactment net capital losses.

As of July 31, 2015, the tax-basis components of distributable earnings, unrealized appreciation (depreciation) and cost of investment securities were as follows (dollars in thousands):

Maryland fund

Undistributed tax-exempt income				$	11
Capital loss carryforward*:
No expiration	$	(5,130	)
Expiring 2018		(2,271	)
Expiring 2019		(73	)		(7,474	)
Gross unrealized appreciation on investment securities					13,052
Gross unrealized depreciation on investment securities					(2,741	)
Net unrealized appreciation on investment securities					10,311
Cost of investment securities					301,708

*	The capital loss carryforward will be used to offset any capital gains realized by the fund in future years through the expiration dates. The fund will not make distributions from capital gains while a capital loss carryforward remains.

24	The American Funds Tax-Exempt Series I

Virginia fund

Undistributed tax-exempt income	$	106
Capital loss carryforward^†		(4,324	)
Gross unrealized appreciation on investment securities		23,037
Gross unrealized depreciation on investment securities		(6,184	)
Net unrealized appreciation on investment securities		16,853
Cost of investment securities		453,705


^†	The capital loss carryforward will be used to offset any capital gains realized by the fund in future years. The fund will not make distributions from capital gains while a capital loss carryforward remains.

Tax-exempt income distributions paid or accrued to shareholders of each fund were as follows (dollars in thousands):

Maryland fund

	Year ended July 31
Share class	2015		2014
Class A	$	7,985	$	8,325
Class B		14		26
Class C		730		854
Class F-1		501		523
Class F-2		723		559
Total	$	9,953	$	10,287

Virginia fund

	Year ended July 31
Share class	2015		2014
Class A	$	11,102	$	11,445
Class B		20		36
Class C		804		847
Class F-1		650		918
Class F-2		1,465		1,066
Total	$	14,041	$	14,312

6. Fees and transactions with related parties

CRMC, the funds’ investment adviser, is the parent company of American Funds Distributors,^® Inc. (“AFD”), the principal underwriter of the funds’ shares, and American Funds Service Company^® (“AFS”), the funds’ transfer agent. CRMC, AFD and AFS are considered related parties to the funds.

Investment advisory services — Each fund has an investment advisory agreement with CRMC that provides for monthly fees accrued daily. These fees are based on a series of decreasing annual rates beginning with 0.300% on the first $60 million of each fund’s daily net assets and decreasing to 0.180% on such assets in excess of $1 billion. The agreement also provides for monthly fees, accrued daily, of 3.00% of the first $3,333,333 of each fund’s monthly gross income and 2.50% on such income in excess of $3,333,333. For the year ended July 31, 2015, the investment advisory services fee was $1,101,000 and $1,562,000, which was equivalent to an annualized rate of 0.344% and 0.335% of average daily net assets for the Maryland and Virginia funds, respectively.

Class-specific fees and expenses — Expenses that are specific to individual share classes are accrued directly to the respective share class of each fund. The principal class-specific fees and expenses are further described below:

Distribution services — Each fund has plans of distribution for all share classes, except Class F-2 shares. Under the plans, the board of trustees approves certain categories of expenses that are used to finance activities primarily intended to sell fund shares and service existing accounts. The plans provide for payments, based on an annualized percentage of average daily net assets, with plan limits of 0.25% for Class A shares and 1.00% for Class B and C shares. For Class F-1 shares, each fund’s plan limit is 0.50% of which 0.25% is currently the approved limit. All share classes with a plan may use up to 0.25% of each fund’s average daily net assets to pay service

The American Funds Tax-Exempt Series I

fees, or to compensate AFD for paying service fees, to firms that have entered into agreements with AFD to provide certain shareholder services. The remaining amounts available to be paid under each plan are paid to dealers to compensate them for their sales activities.

For Class A shares, distribution-related expenses include the reimbursement of dealer and wholesaler commissions paid by AFD for certain shares sold without a sales charge. This share class of each fund reimburses AFD for amounts billed within the prior 15 months but only to the extent that the overall annual expense limit of 0.25% is not exceeded. As of July 31, 2015, unreimbursed expenses subject to reimbursement totaled $71,000 for the Maryland fund and $164,000 for the Virginia fund.

Transfer agent services — Each fund has a shareholder services agreement with AFS under which each fund compensates AFS for providing transfer agent services to each of the funds’ share classes. These services include recordkeeping, shareholder communications and transaction processing. In addition, each fund reimburses AFS for amounts paid to third parties for performing transfer agent services on behalf of its respective fund shareholders.

Administrative services — Each fund has an administrative services agreement with CRMC under which each fund compensates CRMC for providing administrative services to Class A, C and F shares. These services include, but are not limited to, coordinating, monitoring, assisting and overseeing third parties that provide services to fund shareholders. Under the agreement, Class A shares of each fund pay an annual fee of 0.01% and Class C and F shares of each fund pay an annual fee of 0.05% of their respective average daily net assets.

For the year ended July 31, 2015, class-specific expenses under the agreements for each fund were as follows (dollars in thousands):

Maryland fund

	Distribution		Transfer agent			Administrative
Share class	services		services			services
Class A		$626		$79			$25
Class B		6		—	*		Not applicable
Class C		303		10			15
Class F-1		41		17			8
Class F-2		Not applicable		24			11
Total class-specific expenses		$976		$130			$59

Virginia fund

	Distribution		Transfer agent			Administrative
Share class	services		services			services
Class A		$906		$103			$36
Class B		8		—	*		Not applicable
Class C		352		10			18
Class F-1		55		24			11
Class F-2		Not applicable		51			23
Total class-specific expenses		$1,321		$188			$88

*Amount less than one thousand.

Trustees’ deferred compensation — Trustees who are unaffiliated with CRMC may elect to defer the cash payment of part or all of their compensation. These deferred amounts, which remain as liabilities of the funds, are treated as if invested in shares of the funds or other American Funds. These amounts represent general, unsecured liabilities of the funds and vary according to the total returns of the selected funds. Trustees’ compensation of $45,000 each for the Maryland fund and the Virginia fund, shown on the accompanying financial statements, includes $35,000 in current fees for each fund (either paid in cash or deferred) and a net increase of $10,000 for each fund in the value of the deferred amounts.

Affiliated officers and trustees — Officers and certain trustees of the trust are or may be considered to be affiliated with CRMC, AFD or AFS. No affiliated officers or trustees received any compensation directly from the funds.

26	The American Funds Tax-Exempt Series I

7. Capital share transactions

Capital share transactions in the funds were as follows (dollars and shares in thousands):

Maryland fund

							Reinvestments										Net (decrease)
	Sales*						of dividends				Repurchases*						increase
Share class	Amount			Shares			Amount		Shares		Amount			Shares			Amount			Shares

Year ended July 31, 2015

Class A	$	23,046			1,438		$	7,276		455	$	(34,176	)		(2,137	)	$	(3,854	)		(244	)
Class B		—	^†		—	^†		14		1		(330	)		(21	)		(316	)		(20	)
Class C		4,271			267			666		42		(7,482	)		(468	)		(2,545	)		(159	)
Class F-1		3,633			227			454		28		(3,511	)		(219	)		576			36
Class F-2		7,508			469			659		41		(2,581	)		(161	)		5,586			349
Total net increase (decrease)	$	38,458			2,401		$	9,069		567	$	(48,080	)		(3,006	)	$	(553	)		(38	)

Year ended July 31, 2014

Class A	$	19,821			1,253		$	7,533		477	$	(53,931	)		(3,432	)	$	(26,577	)		(1,702	)
Class B		—	^†		—	^†		25		1		(743	)		(47	)		(718	)		(46	)
Class C		2,517			159			753		48		(11,651	)		(741	)		(8,381	)		(534	)
Class F-1		5,508			351			490		31		(7,082	)		(450	)		(1,084	)		(68	)
Class F-2		9,725			616			519		33		(8,842	)		(563	)		1,402			86
Total net increase (decrease)	$	37,571			2,379		$	9,320		590	$	(82,249	)		(5,233	)	$	(35,358	)		(2,264	)

Virginia fund

							Reinvestments										Net increase
	Sales*						of dividends				Repurchases*						(decrease)
Share class	Amount			Shares			Amount		Shares		Amount			Shares			Amount			Shares

Year ended July 31, 2015

Class A	$	42,814			2,531		$	10,227		605	$	(50,099	)		(2,959	)	$	2,942			177
Class B		—	^†		—	^†		18		1		(665	)		(40	)		(647	)		(39	)
Class C		5,253			310			745		44		(6,364	)		(377	)		(366	)		(23	)
Class F-1		4,008			237			639		38		(6,577	)		(389	)		(1,930	)		(114	)
Class F-2		16,596			977			1,403		83		(5,900	)		(349	)		12,099			711
Total net increase (decrease)	$	68,671			4,055		$	13,032		771	$	(69,605	)		(4,114	)	$	12,098			712

Year ended July 31, 2014

Class A	$	37,668			2,265		$	10,439		628	$	(70,566	)		(4,279	)	$	(22,459	)		(1,386	)
Class B		8			1			32		2		(651	)		(39	)		(611	)		(36	)
Class C		5,199			312			776		47		(10,019	)		(607	)		(4,044	)		(248	)
Class F-1		6,818			412			898		54		(22,067	)		(1,332	)		(14,351	)		(866	)
Class F-2		18,923			1,138			1,007		61		(10,859	)		(660	)		9,071			539
Total net increase (decrease)	$	68,616			4,128		$	13,152		792	$	(114,162	)		(6,917	)	$	(32,394	)		(1,997	)

*	Includes exchanges between share classes of the fund.
^†	Amount less than one thousand.

8. Investment transactions

The Maryland fund and the Virginia fund made purchases of investment securities of $102,651,000 and $110,782,000 and sales of investment securities of $80,537,000 and $59,484,000, respectively, during the year ended July 31, 2015. Short-term securities and U.S. government obligations, if any, were excluded.

The American Funds Tax-Exempt Series I

The Tax-Exempt Fund of Maryland

Financial highlights

			Income (loss) from investment operations¹
	Net asset value, beginning of period		Net investment income		Net (losses) gains on securities (both realized and unrealized)			Total from investment operations			Dividends (from net investment income)			Net asset value, end of period		Total return²			Net assets, end of period (in millions)			Ratio of expenses to average net assets			Ratio of net income to average net assets
Class A:
Year ended 7/31/2015	$	15.96	$	.52	$	(.16	)	$	.36		$	(.51	)	$	15.81		2.26	%	$	245			.69	%		3.23	%
Year ended 7/31/2014		15.73		.52		.23			.75			(.52	)		15.96		4.83			251			.70			3.25
Year ended 7/31/2013		16.51		.51		(.78	)		(.27	)		(.51	)		15.73		(1.73	)		274			.67			3.10
Year ended 7/31/2012		15.58		.53		.93			1.46			(.53	)		16.51		9.51			304			.67			3.30
Year ended 7/31/2011		15.74		.55		(.16	)		.39			(.55	)		15.58		2.54			271			.67			3.55

Class B:
Year ended 7/31/2015		15.96		.40		(.16	)		.24			(.39	)		15.81		1.51			—	³		1.42			2.48
Year ended 7/31/2014		15.73		.40		.23			.63			(.40	)		15.96		4.07			1			1.44			2.52
Year ended 7/31/2013		16.51		.39		(.78	)		(.39	)		(.39	)		15.73		(2.45	)		2			1.41			2.36
Year ended 7/31/2012		15.58		.41		.93			1.34			(.41	)		16.51		8.71			2			1.40			2.59
Year ended 7/31/2011		15.74		.43		(.16	)		.27			(.43	)		15.58		1.79			4			1.42			2.80

Class C:
Year ended 7/31/2015		15.96		.39		(.16	)		.23			(.38	)		15.81		1.47			29			1.47			2.44
Year ended 7/31/2014		15.73		.39		.23			.62			(.39	)		15.96		4.01			31			1.49			2.47
Year ended 7/31/2013		16.51		.38		(.78	)		(.40	)		(.38	)		15.73		(2.50	)		39			1.46			2.31
Year ended 7/31/2012		15.58		.40		.93			1.33			(.40	)		16.51		8.64			41			1.46			2.51
Year ended 7/31/2011		15.74		.42		(.16	)		.26			(.42	)		15.58		1.74			37			1.47			2.75

Class F-1:
Year ended 7/31/2015		15.96		.50		(.16	)		.34			(.49	)		15.81		2.15			16			.80			3.12
Year ended 7/31/2014		15.73		.50		.23			.73			(.50	)		15.96		4.71			16			.82			3.14
Year ended 7/31/2013		16.51		.48		(.78	)		(.30	)		(.48	)		15.73		(1.88	)		17			.82			2.96
Year ended 7/31/2012		15.58		.51		.93			1.44			(.51	)		16.51		9.40			20			.76			3.20
Year ended 7/31/2011		15.74		.53		(.16	)		.37			(.53	)		15.58		2.43			16			.77			3.44

Class F-2:
Year ended 7/31/2015		15.96		.54		(.16	)		.38			(.53	)		15.81		2.40			24			.56			3.36
Year ended 7/31/2014		15.73		.54		.23			.77			(.54	)		15.96		4.97			19			.57			3.38
Year ended 7/31/2013		16.51		.53		(.78	)		(.25	)		(.53	)		15.73		(1.59	)		17			.54			3.25
Year ended 7/31/2012		15.58		.56		.93			1.49			(.56	)		16.51		9.70			16			.49			3.47
Year ended 7/31/2011		15.74		.58		(.16	)		.42			(.58	)		15.58		2.74			12			.47			3.74

	Year ended July 31
	2015	2014	2013	2012	2011
Portfolio turnover rate for all share classes	27%	11%	13%	7%	9%

¹	Based on average shares outstanding.
²	Total returns exclude any applicable sales charges, including contingent deferred sales charges.
³	Amount less than $1 million.

See Notes to Financial Statements

28	The American Funds Tax-Exempt Series І

The Tax-Exempt Fund of Virginia

Financial highlights

			Income (loss) from investment operations¹
	Net asset value, beginning of period		Net investment income		Net (losses) gains on securities (both realized and unrealized)			Total from investment operations			Dividends (from net investment income)			Net asset value, end of period		Total return²			Net assets, end of period (in millions)		Ratio of expenses to average net assets			Ratio of net income to average net assets
Class A:
Year ended 7/31/2015	$	16.84	$	.53	$	(.12	)	$	.41		$	(.52	)	$	16.73		2.43	%	$	361		.66	%		3.12	%
Year ended 7/31/2014		16.47		.53		.37			.90			(.53	)		16.84		5.57			361		.67			3.23
Year ended 7/31/2013		17.44		.52		(.97	)		(.45	)		(.52	)		16.47		(2.70	)		376		.65			2.99
Year ended 7/31/2012		16.47		.56		.97			1.53			(.56	)		17.44		9.42			394		.66			3.29
Year ended 7/31/2011		16.65		.58		(.18	)		.40			(.58	)		16.47		2.47			343		.65			3.53

Class B:
Year ended 7/31/2015		16.84		.41		(.13	)		.28			(.39	)		16.73		1.69			1		1.39			2.40
Year ended 7/31/2014		16.47		.41		.37			.78			(.41	)		16.84		4.80			1		1.41			2.49
Year ended 7/31/2013		17.44		.39		(.97	)		(.58	)		(.39	)		16.47		(3.41	)		2		1.39			2.26
Year ended 7/31/2012		16.47		.43		.97			1.40			(.43	)		17.44		8.62			3		1.39			2.57
Year ended 7/31/2011		16.65		.46		(.18	)		.28			(.46	)		16.47		1.71			4		1.41			2.77

Class C:
Year ended 7/31/2015		16.84		.39		(.11	)		.28			(.39	)		16.73		1.63			34		1.45			2.33
Year ended 7/31/2014		16.47		.40		.37			.77			(.40	)		16.84		4.74			35		1.46			2.44
Year ended 7/31/2013		17.44		.38		(.97	)		(.59	)		(.38	)		16.47		(3.45	)		38		1.44			2.21
Year ended 7/31/2012		16.47		.42		.97			1.39			(.42	)		17.44		8.56			43		1.45			2.50
Year ended 7/31/2011		16.65		.45		(.18	)		.27			(.45	)		16.47		1.66			38		1.45			2.74

Class F-1:
Year ended 7/31/2015		16.84		.51		(.12	)		.39			(.50	)		16.73		2.32			21		.77			3.00
Year ended 7/31/2014		16.47		.51		.37			.88			(.51	)		16.84		5.43			23		.80			3.10
Year ended 7/31/2013		17.44		.49		(.97	)		(.48	)		(.49	)		16.47		(2.83	)		37		.79			2.86
Year ended 7/31/2012		16.47		.54		.97			1.51			(.54	)		17.44		9.30			38		.76			3.18
Year ended 7/31/2011		16.65		.56		(.18	)		.38			(.56	)		16.47		2.36			28		.76			3.42

Class F-2:
Year ended 7/31/2015		16.84		.55		(.12	)		.43			(.54	)		16.73		2.56			51		.53			3.24
Year ended 7/31/2014		16.47		.55		.37			.92			(.55	)		16.84		5.70			39		.54			3.36
Year ended 7/31/2013		17.44		.54		(.97	)		(.43	)		(.54	)		16.47		(2.57	)		29		.52			3.12
Year ended 7/31/2012		16.47		.59		.97			1.56			(.59	)		17.44		9.59			26		.50			3.43
Year ended 7/31/2011		16.65		.60		(.18	)		.42			(.60	)		16.47		2.64			17		.49			3.69

	Year ended July 31
	2015	2014	2013	2012	2011
Portfolio turnover rate for all share classes	14%	12%	15%	9%	10%

¹	Based on average shares outstanding.
²	Total returns exclude any applicable sales charges, including contingent deferred sales charges.

See Notes to Financial Statements

The American Funds Tax-Exempt Series І

Report of Independent Registered Public Accounting Firm

To the Board of Trustees and Shareholders of The American Funds Tax-Exempt Series I

In our opinion, the accompanying statements of assets and liabilities, including the summary investment portfolios, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of The Tax-Exempt Fund of Maryland and The Tax-Exempt Fund of Virginia (constituting The American Funds Tax-Exempt Series I, hereafter referred to as the “Trust”) at July 31, 2015, the results of each of their operations for the year then ended, the changes in each of their net assets for each of the two years in the period then ended and the financial highlights for each of the five years in the period then ended, 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 Trust’s 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 July 31, 2015 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.

PricewaterhouseCoopers LLP
Los Angeles, California
September 10, 2015

30	The American Funds Tax-Exempt Series I

Expense example

unaudited

As a shareholder of the fund, you incur two types of costs: (1) transaction costs, such as initial sales charges on purchase payments and contingent deferred sales charges on redemptions (loads), and (2) ongoing costs, including management fees, distribution and service (12b-1) fees, and other expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the fund so you can compare these costs with the ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire six-month period (February 1, 2015, through July 31, 2015).

Actual expenses:

The first line of each share class in the tables on the following page provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses paid during period” to estimate the expenses you paid on your account during this period.

Hypothetical example for comparison purposes:

The second line of each share class in the tables on the following page provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio for the share class and an assumed rate of return of 5.00% per year before expenses, which is not the actual return of the share class. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the fund and other funds. To do so, compare this 5.00% hypothetical example with the 5.00% hypothetical examples that appear in the shareholder reports of the other funds.

Notes:

Retirement plan participants may be subject to certain fees charged by the plan sponsor, and Class F-1 and F-2 shareholders may be subject to fees charged by financial intermediaries, typically ranging from 0.75% to 1.50% of assets annually depending on services offered. You can estimate the impact of these fees by adding the amount of the fees to the total estimated expenses you paid on your account during the period as calculated above. In addition, your ending account value would be lower by the amount of these fees.

Note that the expenses shown in the tables are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads). Therefore, the second line of each share class in the table is useful in comparing ongoing costs only and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

The American Funds Tax-Exempt Series I

The Tax-Exempt Fund of Maryland	Beginning account value 2/1/2015		Ending account value 7/31/2015		Expenses paid during period*		Annualized expense ratio
Class A – actual return	$	1,000.00	$	991.67	$	3.36		.68	%
Class A – assumed 5% return		1,000.00		1,021.42		3.41		.68
Class B – actual return		1,000.00		988.01		6.95		1.41
Class B – assumed 5% return		1,000.00		1,017.80		7.05		1.41
Class C – actual return		1,000.00		987.81		7.25		1.47
Class C – assumed 5% return		1,000.00		1,017.50		7.35		1.47
Class F-1 – actual return		1,000.00		991.13		3.90		.79
Class F-1 – assumed 5% return		1,000.00		1,020.88		3.96		.79
Class F-2 – actual return		1,000.00		992.30		2.77		.56
Class F-2 – assumed 5% return		1,000.00		1,022.02		2.81		.56

The Tax-Exempt Fund of Virginia	Beginning account value 2/1/2015		Ending account value 7/31/2015		Expenses paid during period*		Annualized expense ratio
Class A – actual return	$	1,000.00	$	989.18	$	3.21		.65	%
Class A – assumed 5% return		1,000.00		1,021.57		3.26		.65
Class B – actual return		1,000.00		985.61		6.79		1.38
Class B – assumed 5% return		1,000.00		1,017.95		6.90		1.38
Class C – actual return		1,000.00		985.30		7.09		1.44
Class C – assumed 5% return		1,000.00		1,017.65		7.20		1.44
Class F-1 – actual return		1,000.00		988.61		3.80		.77
Class F-1 – assumed 5% return		1,000.00		1,020.98		3.86		.77
Class F-2 – actual return		1,000.00		989.78		2.61		.53
Class F-2 – assumed 5% return		1,000.00		1,022.17		2.66		.53

*	The “expenses paid during period” are equal to the “annualized expense ratio,” multiplied by the average account value over the period, multiplied by the number of days in the period, and divided by 365 (to reflect the one-half year period).

Tax information

unaudited

We are required to advise you of the Maryland and Virginia funds’ federal tax status of certain distributions received by shareholders during the fiscal year. Each fund hereby designates the following amount for its fiscal year ended July 31, 2015:

Exempt interest dividends

100%

Individual shareholders should refer to their Form 1099 or other tax information, which will be mailed in January 2016, to determine the calendar year amounts to be included on their 2015 tax returns. Shareholders should consult their tax advisors.

32	The American Funds Tax-Exempt Series I

Approval of Investment Advisory and Service Agreement

American Funds Tax-Exempt Series I ’s board has approved an Investment Advisory and Service Agreement (the “agreement”) for the trust with Capital Research and Management Company (“CRMC”) for an additional one-year term through July 31, 2016. The board approved the agreement following the recommendation of the trust’s Contracts Committee (the “committee”), which is composed of all of the trust’s independent board members. The board and the committee determined that the funds’ advisory fee structure was fair and reasonable in relation to the services provided and that approving the agreement was in the best interests of the funds and their shareholders.

In reaching this decision, the board and the committee took into account information furnished to them throughout the year and otherwise provided to them, as well as information prepared specifically in connection with their consideration of the agreement, and were advised by their independent counsel. They considered the following factors, among others, but did not identify any single issue or particular piece of information that, in isolation, was the controlling factor, and each board and committee member did not necessarily attribute the same weight to each factor.

1. Nature, extent and quality of services

The board and the committee considered the depth and quality of CRMC’s investment management process, including its global research capabilities; the experience, capability and integrity of its senior management and other personnel; the low turnover rates of its key personnel; the overall financial strength and stability of CRMC and the Capital Group organization; and the ongoing evolution of CRMC’s organizational structure designed to maintain and strengthen these qualities. The board and the committee also considered the nature, extent and quality of administrative, compliance and shareholder services provided by CRMC to the funds under the agreement and other agreements, as well as the benefits to fund shareholders from investing in a fund that is part of a large family of funds. The board and the committee concluded that the nature, extent and quality of the services provided by CRMC have benefited and should continue to benefit the funds and their shareholders.

2. Investment results

The board and the committee considered the investment results of the funds in light of their objective to provide a high level of current income that is exempt from regular federal and state income taxes. They compared the funds’ investment results with those of other relevant funds (including funds that form the basis of the Lipper index for the category in which each fund is included), and data such as relevant market and fund indexes, over various periods through December 31, 2014. This report, including the letter to shareholders and related disclosures, contains certain information about the funds’ investment results. The board and the committee reviewed each fund’s investment results measured against each relevant state Barclay Municipal Index and each relevant state Lipper Debt Funds Index and average. Results were mixed relative to the benchmarks and funds included in those indexes and averages. The board and the committee concluded that the funds’ investment results have been satisfactory and CRMC’s record in managing the funds indicated that its continued management should benefit each fund and its shareholders.

3. Advisory fees and total expenses

The board and the committee compared the advisory fees and total expense levels of the funds to those of other relevant funds. They observed that the funds’ advisory fees and expenses generally compared favorably to those of other similar funds included in the Lipper Debt Funds state-specific category. The board and the committee also considered the breakpoint discounts in the funds’ advisory fee structure that reduce the level of fees charged by CRMC to the funds as fund assets and income increase. In addition, they reviewed information regarding the effective advisory fees charged to non-mutual fund clients by CRMC and its affiliates. They noted that, to the extent there were differences between the advisory fees paid by the funds and the advisory fees paid by those clients, the differences appropriately reflected the investment, operational and regulatory differences between advising the funds and the other clients. The board and the committee concluded that the funds’ cost structure was fair and reasonable in relation to the services provided, and that the funds’ shareholders receive reasonable value in return for the advisory fees and other amounts paid to CRMC by the funds.

The American Funds Tax-Exempt Series I

4. Ancillary benefits

The board and the committee considered a variety of other benefits that CRMC and its affiliates receive as a result of CRMC’s relationship with the funds and the other American Funds, including fees for administrative services provided to certain share classes; fees paid to CRMC’s affiliated transfer agent; sales charges and distribution fees received and retained by the funds’ principal underwriter, an affiliate of CRMC; and possible ancillary benefits to CRMC and its institutional management affiliates in managing other investment vehicles. The board and the committee reviewed CRMC’s portfolio trading practices, noting the potential benefits CRMC receives from the research obtained with commissions from portfolio transactions made on behalf of the funds. The board and the committee took these ancillary benefits into account in evaluating the reasonableness of the advisory fees and other amounts paid to CRMC by the funds.

5. Adviser financial information

The board and the committee reviewed information regarding CRMC’s costs of providing services to the American Funds, including personnel, systems and resources of investment, compliance, trading, accounting and other administrative operations. They considered CRMC’s costs and willingness to invest in technology, infrastructure and staff to maintain and expand services and capabilities, respond to industry and regulatory developments, and attract and retain qualified personnel. They noted information regarding the compensation structure for CRMC’s investment professionals. The board and the committee also compared CRMC’s profitability and compensation data to the reported results and data of several large, publicly held investment management companies. The board and the committee noted the competitiveness and cyclicality of both the mutual fund industry and the capital markets, and the importance in that environment of CRMC’s long-term profitability for maintaining its independence, company culture and management continuity. They further considered the breakpoint discounts in the funds’ advisory fee structure. The board and the committee concluded that the funds’ advisory fee structure reflected a reasonable sharing of benefits between CRMC and the funds’ shareholders.

34	The American Funds Tax-Exempt Series I

Board of trustees and other officers

Independent trustees¹

Name and year of birth	Year first elected a trustee of the funds²	Principal occupation(s) during past five years	Number of portfolios in fund complex³ overseen by trustee	Other directorships⁴ held by trustee
Nariman Farvardin, PhD, 1956	2010	President, Stevens Institute of Technology; former Senior Vice President for Academic Affairs & Provost, University of Maryland, College Park	3	None
Barbara Hackman Franklin, 1940	2007	President and CEO, Barbara Franklin Enterprises (international business and corporate governance consulting); former U.S. Secretary of Commerce (1992-1993)	3	Aetna, Inc.
R. Clark Hooper, 1946	2005	Private investor	81	The Swiss Helvetia Fund, Inc.
James C. Miller III, PhD, 1942	2000	Senior Advisor, Husch Blackwell LLP (economic, financial and regulatory consulting); former Chairman of the Board, The CapAnalysis Group, LLC (economic, financial and regulatory consulting) (2003-2006); former Director, U.S. Office of Management and Budget (1985-1988)	3	Clean Energy Fuels Corporation
John Knox Singleton, 1948 Chairman of the Board (Independent and Non-Executive)	2004	President and CEO, INOVA Health System	3	Healthcare Realty Trust, Inc.

Interested trustees^5,6

Name, year of birth and position with funds		Year first elected a trustee or officer of the funds²		Principal occupation(s) during past five years and positions held with affiliated entities or the principal underwriter of the funds		Number of portfolios in fund complex³ overseen by trustee		Other directorships⁴ held by trustee
Paul F. Roye, 1953 Vice Chairman of the Board		2012		Senior Vice President — Fund Business Management Group, Capital Research and Management Company; Director, American Funds Service Company⁷		12		None

The funds’ statement of additional information includes further details about fund trustees and is available without charge upon request by calling American Funds Service Company at (800) 421-4225 or by visiting the American Funds website at americanfunds.com. The address for all trustees and officers of the funds is 333 South Hope Street, Los Angeles, CA 90071, Attention: Secretary.

The American Funds Tax-Exempt Series I

Other officers⁶

	Year first
	elected
Name, year of birth and	an officer	Principal occupation(s) during past five years and positions held with affiliated entities
position with funds	of the funds²	or the principal underwriter of the funds
Brenda S. Ellerin, 1963 President	2013	Partner — Capital Fixed Income Investors, Capital Research and Management Company
Michael W. Stockton, 1967 Senior Vice President	1996	Vice President — Fund Business Management Group, Capital Research and Management Company
Donald H. Rolfe, 1972 Vice President	2013	Chief Compliance Officer, Capital Research Company;⁷Chief Compliance Officer, Capital Research and Management Company; Vice President and Senior Counsel — Fund Business Management Group, Capital Research and Management Company
Jennifer L. Butler, 1966 Secretary	2005	Assistant Vice President — Fund Business Management Group, Capital Research and Management Company
Brian D. Bullard, 1969 Treasurer	2013	Senior Vice President — Investment Operations, Capital Research and Management Company
Raymond F. Sullivan, Jr., 1957 Assistant Secretary	2014	Vice President — Fund Business Management Group, Capital Research and Management Company
Karl C. Grauman, 1968 Assistant Treasurer	2013	Vice President — Investment Operations, Capital Research and Management Company
Dori Laskin, 1951 Assistant Treasurer	2013	Vice President — Investment Operations, Capital Research and Management Company

¹	The term independent trustee refers to a trustee who is not an “interested person” of the trust within the meaning of the Investment Company Act of 1940.
²	Trustees and officers of the trust serve until their resignation, removal or retirement.
³	This includes all directorships/trusteeships (other than those in the American Funds or other funds managed by Capital Research and Management Company or its affiliates) that are held by each trustee as a director/trustee of a public company or a registered investment company. Unless otherwise noted, all directorships/trusteeships are current.
⁴	This includes all directorships/trusteeships (other than those in the American Funds or other funds managed by Capital Research and Management Company or its affiliates) that are held by each trustee as a director/trustee of a public company or a registered investment company.
⁵	The term interested trustee refers to a trustee who is an “interested person” within the meaning of the Investment Company Act of 1940, on the basis of his or her affiliation with the funds’ investment adviser, Capital Research and Management Company, or affiliated entities (including the funds’ principal underwriter).
⁶	All of the directors/trustees and/or officers listed are officers and/or directors/trustees of one or more other funds for which Capital Research and Management Company serves as investment adviser.
⁷	Company affiliated with Capital Research and Management Company.

36	The American Funds Tax-Exempt Series I

Offices of the funds and of the investment adviser

Capital Research and Management Company
333 South Hope Street
Los Angeles, CA 90071-1406

6455 Irvine Center Drive
Irvine, CA 92618-4518

Transfer agent for shareholder accounts

American Funds Service Company
(Write to the address near you.)

P.O. Box 6007
Indianapolis, IN 46206-6007

P.O. Box 2280
Norfolk, VA 23501-2280

Custodian of assets

JPMorgan Chase Bank
270 Park Avenue
New York, NY 10017-2070

Counsel

Dechert LLP

1900 K Street, NW
Washington, DC 20006-1110

Independent registered public accounting firm

PricewaterhouseCoopers LLP
601 South Figueroa Street
Los Angeles, CA 90017-5704

Principal underwriter

American Funds Distributors, Inc.
333 South Hope Street
Los Angeles, CA 90071-1406

Investors should carefully consider investment objectives, risks, charges and expenses. This and other important information is contained in the funds’ prospectus and summary prospectus, which can be obtained from your financial professional and should be read carefully before investing. You may also call American Funds Service Company (AFS) at (800) 421-4225 or visit the American Funds website at americanfunds.com.

“American Funds Proxy Voting Procedures and Principles” — which describes how we vote proxies relating to portfolio securities — is available on the American Funds website or upon request by calling AFS. The funds file their proxy voting record with the U.S. Securities and Exchange Commission (SEC) for the 12 months ended June 30 by August 31. The proxy voting record is available free of charge on the SEC website at sec.gov and on the American Funds website.

Complete July 31, 2015, portfolios of The Tax-Exempt Fund of Maryland and The Tax-Exempt Fund of Virginia’s investments are available free of charge by calling AFS or visiting the SEC website (where they are part of Form N-CSR).

The Tax-Exempt Fund of Maryland and The Tax-Exempt Fund of Virginia file a complete list of their portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. This filing is available free of charge on the SEC website. You may also review or, for a fee, copy this filing at the SEC’s Public Reference Room in Washington, D.C. Additional information regarding the operation of the Public Reference Room may be obtained by calling the SEC’s Office of Investor Education and Advocacy at (800) SEC-0330. Additionally, the list of portfolio holdings is available by calling AFS.

This report is for the information of shareholders of The Tax-Exempt Fund of Maryland and The Tax-Exempt Fund of Virginia, but it also may be used as sales literature when preceded or accompanied by the current prospectus or summary prospectus, which gives details about charges, expenses, investment objectives and operating policies of the funds. If used as sales material after September 30, 2015, this report must be accompanied by an American Funds statistical update for the most recently completed calendar quarter.

The American Funds Advantage

Since 1931, American Funds, part of Capital Group, has helped investors pursue long-term investment success. Our consistent approach — in combination with The Capital System^SM— has resulted in a superior long-term track record.

	Aligned with investor success
	We base our decisions on a long-term perspective, which we believe aligns our goals with the interests of our clients. Our portfolio managers average 27 years of investment experience, including 22 years at our company, reflecting a career commitment to our long-term approach.¹

	The Capital System^SM
	Our investment process, The Capital System, combines individual accountability with teamwork. Each fund is divided into portions that are managed independently by investment professionals with diverse backgrounds, ages and investment approaches. An extensive global research effort is the backbone of our system.

	Superior long-term track record
	Our equity funds have beaten their Lipper peer indexes in 91% of 10-year periods and 96% of 20-year periods. Our fixed-income funds have beaten their Lipper indexes in 54% of 10-year periods and 57% of 20-year periods.²Our fund management fees have been among the lowest in the industry.³

	¹	Portfolio manager experience as of December 31, 2014.
	²	Based on Class A share results for rolling periods through December 31, 2014. Periods covered are the shorter of the fund’s lifetime or since the comparable Lipper index inception date (except SMALLCAP World Fund, for which the Lipper average was used).
	³	On average, our management fees were in the lowest quintile 70% of the time, based on the 20-year period ended December 31, 2014, versus comparable Lipper categories, excluding funds of funds.

Printed on paper containing 10% post-consumer waste Printed with inks containing soy and/or vegetable oil
Lit. No. MFGEARX-970-0915P Litho in USA CS/CG/8070-S48524

Tax Exempt Bond Fund Of America N-14Registration statement for investment companies business combination