UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM N-CSR
Investment Company Act file number | 811-04760 |
DWS ADVISOR FUNDS
(FORMERLY SCUDDER ADVISOR FUNDS)
(Exact Name of Registrant as Specified in Charter)
One South Street, Baltimore, Maryland 21202
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including Area Code: (212) 454-7190
Paul Schubert
345 Park Avenue
New York, NY 10154
(Name and Address of Agent for Service)
Date of fiscal year end: | 12/31 |
Date of reporting period: | 12/31/05 |
ITEM 1. | REPORT TO STOCKHOLDERS |
Contents |
Portfolio Management Review |
Q: Will you discuss the market environment for the funds during the year ended December 31, 2005? | |
A: During the year ended December 31, 2005, the US Federal Reserve (the Fed) continued its recent policy of increasing short-term interest rates in an attempt to undo the easing of monetary policy (i.e., the lowering of interest rates) that occurred through June 2004. In eight increments of 0.25%, the policymakers raised the federal funds rate – the interest rate banks charge when they lend each other money overnight – to 4.25%. |
Despite these increases in the federal funds rate, longer-term yields remained low, creating a yield curve – an economic graph with a line going from left to right, showing how high or low yields are from the shortest to the longest maturities – that was atypically flat. (Typically, the line rises from left to right as investors who are willing to tie up their money for a longer period of time are rewarded with higher yields.) | |
Throughout the year, the Fed repeatedly said that its monetary policy remained “accommodative” to economic growth and that risks in the overall economy between inflation and deflation appeared to be balanced. | |
Indeed, over the period, the US economy showed resiliency despite two devastating hurricanes and continual increases in energy prices. As the year began, monthly job growth was the most important economic indicator for money markets. However, the focus gradually shifted to inflation, with economists and investors watching carefully for any signs of an increase. Going forward, the markets will likely watch for any changes in policy from incoming Fed Chairman Ben S. Bernanke. | |
At the end of December 2005, the one-year London Interbank Offered Rate (LIBOR) – the rate of interest at which banks borrow large volumes of funds from other banks in the international market, and the most widely used industry standard for measuring one-year money market rates – was at 4.84%, close to a four-year high. The premium level of the LIBOR (which is set by the market) over the federal funds rate (which is set by the Fed) was 4.25%, representing the market’s concern that the Fed may have to continue raising short-term interest rates to keep the economy’s growth moderate and prevent inflation. | |
Q: How did the funds perform over its most recent fiscal year? | |
A: For the period ended December 31, 2005, the funds registered favorable performance and achieved their stated objectives of providing a high level of current income consistent with liquidity and the preservation of capital. |
Q: In light of market conditions during the period, what has been the strategy for the fund? | |
A: During the period, our strategy was to extend maturity somewhat in order to take advantage of select buying opportunities among money market securities with slightly longer maturities and higher yields. For the period, we also increased the fund’s allocation in floating-rate securities. Our decision to increase the fund’s floating-rate position helped to mitigate risks associated with extending maturity. This is because the interest rates of floating rate securities adjust frequently based on indices such as LIBOR and the federal funds rate as market conditions change. These securities provide flexibility in an uncertain interest rate environment. | |
Q: What has been the strategy for Treasury Money Fund Investment? | |
A: In 2005, supply/demand issues and higher financing costs (resulting from rising interest rates) made Treasuries expensive relative to other money market instruments. For this reason, we maintained a significant allocation in repurchase agreements, which are agreements between sellers and buyers, usually of government securities, to repurchase securities at a given price and usually at a stated time. For most of the year, the fund’s target portfolio allocation was 70% to 75% in repurchase agreements and 25% to 30% in Treasury bills. With the investments in repurchase agreements, our goal was to keep the fund’s weighted average maturity short, and then step up the yield of the fund at each Fed tightening. With our investments in longer-term Treasury bills and notes, our goal was to lengthen the weighted average maturity and achieve a yield close to the current Fed funds rate until the next Fed tightening, whereupon the Treasury position would be sold or held to maturity. Going forward, we will continue to monitor economic and inflation indicators to determine when the Fed will end its credit tightening program. |
7-Day Current Yield — Cash Management Fund Investment |
7-day | ||||||
current | ||||||
yield | ||||||
December 31, 2005 | 3.53%* | |||||
December 31, 2004 | 1.46%* | |||||
7-Day Current Yield — Treasury Money Fund Investment |
7-day | ||||||
current | ||||||
yield | ||||||
December 31, 2005 | 3.16%** | |||||
December 31, 2004 | 1.34%** | |||||
Q: What detracted from performance during the period? | |
A: In the case of Cash Management Fund Investment, in December we kept additional cash on hand – as we do each year – to meet any tax-related redemptions as well as investors’ year-end liquidity needs. Keeping a larger percentage of assets in overnight liquid positions detracted somewhat from yield and total return. For Treasury Money Fund Investment, holding US Treasury securities with maturities of six months or more detracted somewhat from performance due to successive rate increases. |
Q: Will you describe your management philosophy? | |
A: We continue our insistence on the highest credit quality within the funds. We also plan to maintain our conservative investment strategies and standards. We continue to apply a careful approach to investing on behalf of the funds and to seek a competitive yield for our shareholders. |
Information About Each Fund’s Expenses |
n | Actual Fund Return. This helps you estimate the actual dollar amount of ongoing expenses (but not transaction costs) paid on a $1,000 investment in the Fund using the Fund’s actual return during the period. To estimate the expenses 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 “Expenses Paid per $1,000” line under the share class you hold. | |
n | Hypothetical 5% Fund Return. This helps you to compare your Fund’s ongoing expenses (but not transaction costs) with those of other mutual funds using the Fund’s actual expense ratio and a hypothetical rate of return of 5% per year before expenses. Examples using a 5% hypothetical fund return may be found in the shareholder reports of other mutual funds. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. |
Expenses and Value of a $1,000 Investment for the six months ended December 31, 2005 |
Actual Fund Return | ||||||
Beginning Account Value 7/1/05 | $ | 1,000.00 | ||||
Ending Account Value 12/31/05 | $ | 1,015.30 | ||||
Expenses Paid per $1,000* | $ | 3.81 | ||||
Hypothetical 5% Fund Return | ||||||
Beginning Account Value 7/1/05 | $ | 1,000.00 | ||||
Ending Account Value 12/31/05 | $ | 1,021.42 | ||||
Expenses Paid per $1,000* | $ | 3.82 | ||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period, multiplied by the number of days in the most recent six-month period, then divided by 365. |
Annualized Expense Ratio | ||||||
Cash Management Fund Investment | .75% | |||||
Expenses and Value of a $1,000 Investment for the six months ended December 31, 2005 |
Actual Fund Return | ||||||
Beginning Account Value 7/1/05 | $ | 1,000.00 | ||||
Ending Account Value 12/31/05 | $ | 1,014.90 | ||||
Expenses Paid per $1,000* | $ | 3.81 | ||||
Hypothetical 5% Fund Return | ||||||
Beginning Account Value 7/1/05 | $ | 1,000.00 | ||||
Ending Account Value 12/31/05 | $ | 1,021.42 | ||||
Expenses Paid per $1,000* | $ | 3.82 | ||||
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period, multiplied by the number of days in the most recent six-month period, then divided by 365. |
Annualized Expense Ratio | ||||||
Treasury Money Fund Investment | .75% | |||||
Portfolio Summary |
Asset Allocation | 12/31/05 | 12/31/04 | ||||||||
Commercial Paper | 32% | 36% | ||||||||
Certificates of Deposit and Bank Notes | 27% | 23% | ||||||||
Short Term Notes | 21% | 20% | ||||||||
Repurchase Agreements | 7% | 3% | ||||||||
Time Deposit | 4% | 5% | ||||||||
Promissory Notes | 4% | 3% | ||||||||
Funding Agreements | 3% | 3% | ||||||||
US Government Sponsored Agencies† | 1% | 4% | ||||||||
Master Notes | 1% | 2% | ||||||||
Asset Backed | — | 1% | ||||||||
100% | 100% | |||||||||
† | Not backed by the full faith and credit of the US Government |
Weighted Average Maturity | ||||||||||
Cash Management Fund Investment | 47 days | 32 days | ||||||||
First Tier Retail Money Fund Average* | 38 days | 36 days | ||||||||
Asset Allocation | 12/31/05 | 12/31/04 | ||||||||
Repurchase Agreements | 80% | 70% | ||||||||
US Government Backed | 20% | 30% | ||||||||
100% | 100% | |||||||||
Weighted Average Maturity | ||||||||||
Treasury Money Fund Investment | 34 days | 31 days | ||||||||
Treasury and Repo Retail Money Fund Average** | 24 days | 28 days | ||||||||
* | The Fund is compared to its respective iMoneyNet Category: First Tier Retail Money Fund Average — Category includes a widely-recognized composite of money market funds that invest in only first tier (highest rating) securities. Portfolio Holdings of First Tier funds include US Treasury, US Other, Repos, Time Deposits, Domestic Bank Obligations, Foreign Bank Obligations, First Tier Commercial Paper, Floating Rate Notes and Asset Backed Commercial Paper. | |
** | The Fund is compared to its respective iMoneyNet Category: Treasury and Repo Retail Money Fund Average — Category includes only retail government funds that hold US Treasuries and repurchase agreements backed by the US Treasury. |
Financial Statements |
Statement of Assets and Liabilities as of December 31, 2005 |
Cash | ||||||||||
Management | Treasury | |||||||||
Fund | Money Fund | |||||||||
Assets | Investment | Investment | ||||||||
Investments in Portfolio at value* | $ | 83,180,017 | $ | 153,237,113 | ||||||
Other assets | 8,085 | 12,327 | ||||||||
Total assets | 83,188,102 | 153,249,440 | ||||||||
Liabilities | ||||||||||
Dividends payable | 184,926 | 130,300 | ||||||||
Accrued administrator service fee | 39,062 | 60,690 | ||||||||
Other accrued expenses and payables | 46,009 | 36,717 | ||||||||
Total liabilities | 269,997 | 227,707 | ||||||||
Net assets, at value | $ | 82,918,105 | $ | 153,021,733 | ||||||
Net Assets | ||||||||||
Net assets consist of: | ||||||||||
Undistributed net investment income | 17,533 | 13,439 | ||||||||
Accumulated net realized gain (loss) | — | (19,005 | ) | |||||||
Paid–in capital | 82,900,572 | 153,027,299 | ||||||||
Net assets, at value | $ | 82,918,105 | $ | 153,021,733 | ||||||
Net Assets Value | ||||||||||
Net assets applicable to shares outstanding | $ | 82,918,105 | $ | 153,021,733 | ||||||
Shares outstanding of beneficial interest ($.001 par value per share unlimited number of shares authorized) | 82,940,389 | 153,027,299 | ||||||||
Net Asset Value, offering and redemption price per share | $ | 1.00 | $ | 1.00 | ||||||
* | Investment in Cash Management Portfolio and Treasury Money Portfolio, respectively. |
Statement of Operations for the year ended December 31, 2005 |
Cash | ||||||||||
Management | Treasury | |||||||||
Fund | Money Fund | |||||||||
Investment Income | Investment | Investment | ||||||||
Income: | ||||||||||
Total investment income allocated from Cash Management Portfolio and Treasury Money Portfolio, respectively: | ||||||||||
Interest | $ | 3,364,731 | $ | 4,648,172 | ||||||
Expenses | (187,047 | )a | (288,704 | )b | ||||||
Net investment income allocated from the Cash Management Portfolio and Treasury Money Portfolio, respectively | 3,177,684 | 4,359,468 | ||||||||
Expenses: | ||||||||||
Administrator service fee | 574,686 | 799,010 | ||||||||
Audit fees | 24,290 | 20,818 | ||||||||
Legal fees | 30,863 | 29,153 | ||||||||
Trustees’ fees and expenses | 4,207 | 4,500 | ||||||||
Reports to shareholders | 19,165 | 18,164 | ||||||||
Registration fees | 20,542 | 26,127 | ||||||||
Other | 3,144 | 7,570 | ||||||||
Total expenses, before expense reductions | 676,897 | 905,342 | ||||||||
Expense reductions | (80,984 | ) | (104,752 | ) | ||||||
Total expenses, after expense reductions | 595,913 | 800,590 | ||||||||
Net investment income | 2,581,771 | 3,558,878 | ||||||||
Net realized gain (loss) from investments | 1,260 | (8,752 | ) | |||||||
Net increase (decrease) in net assets resulting from operations | $ | 2,583,031 | $ | 3,550,126 | ||||||
a | For the year ended December 31, 2005, the Advisor to the Cash Management Portfolio waived fees, of which $29,719 was allocated to the Cash Management Fund Investment on a pro-rated basis. | |
b | For the year ended December 31, 2005, the Advisor to the Treasury Money Portfolio waived fees, of which $35,912 was allocated to the Treasury Money Fund Investment on a pro-rated basis. |
Statement of Changes in Net Assets — Cash Management Fund Investment |
Years Ended December 31, | ||||||||||
Increase (Decrease) in Net Assets | 2005 | 2004 | ||||||||
Operations: | ||||||||||
Net investment income | $ | 2,581,771 | $ | 740,043 | ||||||
Net realized gain (loss) on investment transactions | 1,260 | 936 | ||||||||
Net increase (decrease) in net assets resulting from operations | 2,583,031 | 740,979 | ||||||||
Distributions to shareholders from: | ||||||||||
Net investment income | (2,581,771 | ) | (741,692 | ) | ||||||
Fund share transactions: | ||||||||||
Proceeds from shares sold | 922,341,455 | 1,424,240,134 | ||||||||
Reinvestment of distributions | 580,365 | 99,407 | ||||||||
Cost of shares redeemed | (973,786,303 | ) | (1,426,205,428 | ) | ||||||
Net increase (decrease) in net assets from Fund share transactions | (50,864,483 | ) | (1,865,887 | ) | ||||||
Increase (decrease) in net assets | (50,863,223 | ) | (1,866,600 | ) | ||||||
Net assets at beginning of period | 133,781,328 | 135,647,928 | ||||||||
Net assets at end of period (including undistributed net investment income of $17,533 and $16,274, respectively) | $ | 82,918,105 | $ | 133,781,328 | ||||||
Other Information | ||||||||||
Shares outstanding at beginning of period | 133,804,872 | 135,670,759 | ||||||||
Shares sold | 922,341,455 | 1,424,240,134 | ||||||||
Shares issued to shareholders in reinvestment of distributions | 580,365 | 99,407 | ||||||||
Shares redeemed | (973,786,303 | ) | (1,426,205,428 | ) | ||||||
Net increase (decrease) in Fund shares | (50,864,483 | ) | (1,865,887 | ) | ||||||
Shares outstanding at end of period | 82,940,389 | 133,804,872 | ||||||||
Statement of Changes in Net Assets — Treasury Money Fund Investment |
Years Ended December 31, | ||||||||||
Increase (Decrease) in Net Assets | 2005 | 2004 | ||||||||
Operations: | ||||||||||
Net investment income | $ | 3,558,878 | $ | 1,217,527 | ||||||
Net realized gain (loss) on investment transactions | (8,752 | ) | (10,253 | ) | ||||||
Net increase (decrease) in net assets resulting from operations | 3,550,126 | 1,207,274 | ||||||||
Distributions to shareholders from: | ||||||||||
Net investment income | (3,558,873 | ) | (1,217,508 | ) | ||||||
Fund share transactions: | ||||||||||
Proceeds from shares sold | 982,276,073 | 2,017,751,409 | ||||||||
Reinvestment of distributions | 2,254,295 | 784,340 | ||||||||
Cost of shares redeemed | (1,023,737,067 | ) | (2,041,363,816 | ) | ||||||
Net increase (decrease) in net assets from Fund share transactions | (39,206,699 | ) | (22,828,067 | ) | ||||||
Increase (decrease) in net assets | (39,215,446 | ) | (22,838,301 | ) | ||||||
Net assets at beginning of period | 192,237,179 | 215,075,480 | ||||||||
Net assets at end of period (including undistributed net investment income of $13,439 and $13,434, respectively) | $ | 153,021,733 | $ | 192,237,179 | ||||||
Other Information | ||||||||||
Shares outstanding at beginning of period | 192,233,998 | 215,062,544 | ||||||||
Shares sold | 982,276,073 | 2,017,751,409 | ||||||||
Shares issued in reinvestment of distributions | 2,254,295 | 784,340 | ||||||||
Shares redeemed | (1,023,737,067 | ) | (2,041,364,295 | ) | ||||||
Net increase (decrease) in Fund shares | (39,206,699 | ) | (22,828,546 | ) | ||||||
Shares outstanding at end of period | 153,027,299 | 192,233,998 | ||||||||
Financial Highlights |
Years Ended | |||||||||||||||||||||||
December 31, | 2005 | 2004 | 2003 | 2002 | 2001 | ||||||||||||||||||
Selected Per Share Data | |||||||||||||||||||||||
Net asset value, beginning of period | $ | 1.00 | $ | 1.00 | $ | 1.00 | $ | 1.00 | $ | 1.00 | |||||||||||||
Income from investment operations: | |||||||||||||||||||||||
Net investment income | .025 | .007 | .005 | .011 | .04 | ||||||||||||||||||
Net realized and unrealized gain (loss) on investment transactionsa | — | — | — | — | — | ||||||||||||||||||
Total from investment operations | .025 | .007 | .005 | .011 | .04 | ||||||||||||||||||
Less distributions from: | |||||||||||||||||||||||
Net investment income | (.025 | ) | (.007 | ) | (.005 | ) | (.011 | ) | (.04 | ) | |||||||||||||
Net asset value, end of period | $ | 1.00 | $ | 1.00 | $ | 1.00 | $ | 1.00 | $ | 1.00 | |||||||||||||
Total Return (%)b | 2.56 | .68 | .51 | 1.14 | 3.63 | ||||||||||||||||||
Ratios to Average Net Assets and Supplemental Data | |||||||||||||||||||||||
Net assets, end of period ($ millions) | 83 | 134 | 136 | 158 | 189 | ||||||||||||||||||
Ratio of expenses before expense reductions, including expenses allocated from Cash Management Portfolio (%) | .86 | .85 | .79 | .78 | .78 | ||||||||||||||||||
Ratio of expenses after expense reductions, including expenses allocated from Cash Management Portfolio (%) | .75 | .75 | .75 | .75 | .75 | ||||||||||||||||||
Ratio of net investment income (loss) (%) | 2.47 | c | .67 | .49 | 1.10 | 3.60 | |||||||||||||||||
a | Amount is less than $.0005. | |
b | Total returns would have been lower had certain expenses not been reduced. | |
c | Due to the timing of subscriptions and redemptions in relation to the operating results of the Fund, the amount shown does not correspond to the total return during the year. |
Years Ended | |||||||||||||||||||||||
December 31, | 2005 | 2004 | 2003 | 2002 | 2001 | ||||||||||||||||||
Selected Per Share Data | |||||||||||||||||||||||
Net asset value, beginning of period | $ | 1.00 | $ | 1.00 | $ | 1.00 | $ | 1.00 | $ | 1.00 | |||||||||||||
Income from investment operations: | |||||||||||||||||||||||
Net investment income | .024 | .006 | .004 | .010 | .03 | ||||||||||||||||||
Net realized gain (loss) on investment transactionsa | — | — | — | — | — | ||||||||||||||||||
Total from investment operations | .024 | .006 | .004 | .010 | .03 | ||||||||||||||||||
Less distributions from: | |||||||||||||||||||||||
Net investment income | (.024 | ) | (.006 | ) | (.004 | ) | (.010 | ) | (.03 | ) | |||||||||||||
Net realized gain on investment transactions | — | — | —a | —a | — | ||||||||||||||||||
Total distributions | (.024 | ) | (.006 | ) | (.004 | ) | (.010 | ) | (.03 | ) | |||||||||||||
Net asset value, end of period | $ | 1.00 | $ | 1.00 | $ | 1.00 | $ | 1.00 | $ | 1.00 | |||||||||||||
Total Return (%)b | 2.44 | .60 | .41 | 1.04 | 3.33 | ||||||||||||||||||
Ratios to Average Net Assets and Supplemental Data | |||||||||||||||||||||||
Net assets, end of period ($ millions) | 153 | 192 | 215 | 214 | 285 | ||||||||||||||||||
Ratio of expenses before expense reductions, including expenses allocated from Treasury Money Portfolio (%) | .84 | .82 | .81 | .78 | .79 | ||||||||||||||||||
Ratio of expenses after expense reductions, including expenses allocated from Treasury Money Portfolio (%) | .75 | .75 | .75 | .75 | .75 | ||||||||||||||||||
Ratio of net investment income (%) | 2.44 | .54 | .40 | 1.03 | 3.25 | ||||||||||||||||||
a | Amount is less than $.0005. | |
b | Total return would have been lower had certain expenses not been reduced. |
Notes to Financial Statements |
Cash Management | Treasury Money | |||||||||
Fund Investment | Fund Investment | |||||||||
Undistributed ordinary income* | $ | 17,533 | $ | 13,439 | ||||||
Years Ended December 31, | 2005 | 2004 | ||||||||
Cash Management Fund Investment | ||||||||||
Distributions from ordinary income* | $ | 2,581,745 | $ | 741,692 | ||||||
Distributions from long term-capital gains | 26 | — | ||||||||
Treasury Money Fund Investment | ||||||||||
Distributions form ordinary income* | $ | 3,558,873 | $ | 1,217,508 | ||||||
* | For tax purposes short-term capital gains distributions are considered ordinary income distributions. |
Total | Amount | Annual | ||||||||||||
Aggregated | Waived | Effective Rate | ||||||||||||
Cash Management Fund Investment | $ | 574,686 | $ | 80,984 | .47% | |||||||||
Treasury Money Fund Investment | $ | 799,010 | $ | 104,752 | .48% | |||||||||
Total | Unpaid at | |||||||||
Aggregated | December 31, 2005 | |||||||||
Cash Management Fund Investment | $ | 6,360 | $ | 2,100 | ||||||
Treasury Money Fund Investment | $ | 6,360 | $ | 2,100 | ||||||
DeAM expects to reach final agreements with regulators early in 2006 regarding allegations of improper trading in the DWS funds. DeAM expects that it will reach settlement agreements with the Securities and Exchange Commission, the New York Attorney General and the Illinois Secretary of State providing for payment of disgorgement, penalties, and investor education contributions totaling approximately $134 million. Approximately $127 million of this amount would be distributed to shareholders of the affected DWS funds in accordance with a distribution plan to be developed by an independent distribution consultant. DeAM does not believe that any of the DWS funds will be named as respondents or defendants in any proceedings. The funds’ investment advisors do not believe these amounts will have a material adverse financial impact on them or materially affect their ability to perform under their investment management agreements with the DWS funds. The above-described amounts are not material to Deutsche Bank, and they have already been reserved. | |
Based on the settlement discussions thus far, DeAM believes that it will be able to reach a settlement with the regulators on a basis that is generally consistent with settlements reached by other advisors, taking into account the particular facts and circumstances of market timing at DeAM and at the legacy Scudder and Kemper organizations prior to their acquisition by DeAM in April 2002. Among the terms of the expected settled orders, DeAM would be subject to certain undertakings regarding the conduct of its business in the future, including maintaining existing management fee reductions for certain funds for a period of five years. DeAM expects that these settlements would resolve regulatory allegations that it violated certain provisions of federal and state securities laws (i) by entering into trading arrangements that permitted certain investors to engage in market timing in certain DWS funds and (ii) by failing more generally to take adequate measures to prevent market timing in the DWS funds, primarily during the 1999–2001 period. With respect to the trading |
arrangements, DeAM expects that the settlement documents will include allegations related to one legacy DeAM arrangement, as well as three legacy Scudder and six legacy Kemper arrangements. All of these trading arrangements originated in businesses that existed prior to the current DeAM organization, which came together in April 2002 as a result of the various mergers of the legacy Scudder, Kemper and Deutsche fund groups, and all of the arrangements were terminated prior to the start of the regulatory investigations that began in the summer of 2003. No current DeAM employee approved the trading arrangements. |
Report of Independent Registered Public Accounting Firm |
Tax Information | (Unaudited) |
Trustees and Officers |
Independent Trustees |
Name, Date of | Number of | |||||
Birth, Position | Funds in | |||||
with the Fund | the Fund | |||||
and Length of | Business Experience and Directorships | Complex | ||||
Time Served1,2 | During the Past 5 Years | Overseen | ||||
Richard R. Burt 2/3/47 Trustee since 2002 | Chairman, Diligence Inc. (international information collection and risk-management firm (since September 2002); Chairman, IEP Advisors, Inc. (July 1998–present); Member of the Board, Hollinger International, Inc.3 (publishing) (September 1995 to present), HCL Technologies Limited (information technology) (since April 1999), UBS Mutual Funds (formerly known as Brinson and Mitchell Hutchins families of funds) (registered investment companies) (September 1995 to present); and Member, Textron Inc.3 International Advisory Council (since July 1996); Director, The European Equity Fund, Inc. (since 2000), The New Germany Fund, Inc. (since 2004), The Central Europe and Russia Fund, Inc. (since 2000), DWS Global High Income Fund, Inc. (since 2005), DWS Global Commodities Stock Fund, Inc. (since 2005). Formerly, Partner, McKinsey & Company (consulting) (1991–1994) and US Chief Negotiator in Strategic Arms Reduction Talks (START) with former Soviet Union and US Ambassador to the Federal Republic of Germany (1985–1991); Member of the Board, Homestake Mining3 (mining and exploration) (1998–February 2001), Archer Daniels Midland Company3 (agribusiness operations) (October 1996–June 2001) and Anchor Gaming (gaming software and equipment) (March 1999–December 2001); Chairman of the Board, Weirton Steel Corporation3 (April 1996–2004). | 54 | ||||
Martin J. Gruber 7/15/37 Trustee since 1999 | Nomura Professor of Finance, Leonard N. Stern School of Business, New York University (since September 1965); Director, Japan Equity Fund, Inc. (since January 1992), Thai Capital Fund, Inc. (since January 2000) and Singapore Fund, Inc. (since January 2000) (registered investment companies), DWS Global High Income Fund, Inc. (since 2005), DWS Global Commodities Stock Fund, Inc. (since 2005). Formerly, Trustee, TIAA (pension funds) (January 1996–January 2000); Trustee, CREF and CREF Mutual Funds (January 2000–March 2005); Chairman, CREF and CREF Mutual Funds, (February 2004–March 2005) and Director, S.G. Cowen Mutual Funds (January 1985–January 2001). | 51 | ||||
Name, Date of | Number of | |||||
Birth, Position | Funds in | |||||
with the Fund | the Fund | |||||
and Length of | Business Experience and Directorships | Complex | ||||
Time Served1,2 | During the Past 5 Years | Overseen | ||||
Richard J. Herring 2/18/46 Trustee since 1990 for the funds and since 1999 for Cash Management Portfolio and Treasury Money Portfolio | Jacob Safra Professor of International Banking and Professor, Finance Department, The Wharton School, University of Pennsylvania (since July 1972); Director, Lauder Institute of International Management Studies (since July 2000); Co-Director, Wharton Financial Institutions Center (since July 2000). Formerly, Vice Dean and Director, Wharton Undergraduate Division (July 1995–June 2000). | 51 | ||||
Graham E. Jones 1/31/33 Trustee since 2002 | Senior Vice President, BGK Realty, Inc. (commercial real estate) (since 1995); Director, DWS Global High Income Fund, Inc. (since 2005), DWS Global Commodities Stock Fund, Inc. (since 2005). Formerly, Trustee of various investment companies managed by Sun Capital Advisors, Inc. (1998–2005); Trustee, Morgan Stanley Asset Management, various funds (1985–2001); Trustee, Weiss, Peck and Greer, various funds (1985–2005). | 51 | ||||
Rebecca W. Rimel 4/10/51 Trustee since 2002 | President and Chief Executive Officer, The Pew Charitable Trusts (charitable foundation) (1994–present); Trustee, Thomas Jefferson Foundation (charitable organization) (1994–present); Trustee, Executive Committee, Philadelphia Chamber of Commerce (2001–present); Director, DWS Global High Income Fund, Inc. (since 2005), DWS Global Commodities Stock Fund, Inc. (since 2005). Formerly, Executive Vice President, The Glenmede Trust Company (investment trust and wealth management) (1983–2004); Board Member, Investor Education (charitable organization) (2004–2005). | 51 | ||||
Philip Saunders, Jr. 10/11/35 Trustee since 1999 for the funds and since 1990 for Cash Management Portfolio and Treasury Money Portfolio | Principal, Philip Saunders Associates (economic and financial consulting) (since November 1988). Formerly, Director, Financial Industry Consulting, Wolf & Company (consulting) (1987–1988); President, John Hancock Home Mortgage Corporation (1984–1986); Senior Vice President of Treasury and Financial Services, John Hancock Mutual Life Insurance Company, Inc. (1982–1986). | 51 | ||||
William N. Searcy, Jr. 9/3/46 Trustee since 2002 | Private investor (since October 2003); Trustee of 18 open-end mutual funds managed by Sun Capital Advisers, Inc. (since October 1998). Formerly, Pension & Savings Trust Officer, Sprint Corporation3 (telecommunications) (November 1989–October 2003). | 51 | ||||
Interested Trustee |
Name, Date of | Number of | |||||
Birth, Position | Funds in | |||||
with the Fund | the Fund | |||||
and Length of | Business Experience and Directorships | Complex | ||||
Time Served1,2 | During the Past 5 Years | Overseen | ||||
William N. Shiebler4 2/6/42 Trustee since 2004 | Vice Chairman, Deutsche Asset Management (“DeAM”) and a member of the DeAM Global Executive Committee (since 2002); Vice Chairman of Putnam Investments, Inc. (1999); Director and Senior Managing Director of Putnam Investments, Inc. and President, Chief Executive Officer, and Director of Putnam Mutual Funds Inc. (1990–1999). | 120 | ||||
Officers |
Name, Date of Birth, | ||
Position with the Fund and | Business Experience and Directorships | |
Length of Time Served1,2 | During the Past 5 Years | |
Vincent J. Esposito6 6/8/56 President since 2005 | Managing Director5, Deutsche Asset Management (since 2003); President and Chief Executive Officer of The Central Europe and Russia Fund, Inc., The European Equity Fund, Inc., The New Germany Fund, Inc. (since 2003) (registered investment companies); Vice Chairman and Director of The Brazil Fund, Inc. (2004–present); formerly, Managing Director, Putnam Investments (1991–2002). | |
Paul H. Schubert6 1/11/63 Chief Financial Officer since 2004 Treasurer since June 2005 | Managing Director5, Deutsche Asset Management (since July 2004); formerly, Executive Director, Head of Mutual Fund Services and Treasurer for UBS Family of Funds (1998–2004); Vice President and Director of Mutual Fund Finance at UBS Global Asset Management (1994–1998). | |
John Millette7 8/23/62 Secretary since 2003 | Director5, Deutsche Asset Management. | |
Patricia DeFilippis6 6/21/63 Assistant Secretary since 2005 | Vice President, Deutsche Asset Management (since June 2005); Counsel, New York Life Investment Management LLC (2003–2005); legal associate, Lord, Abbett & Co. LLC (1998–2003). | |
Elisa D. Metzger6 9/15/62 Assistant Secretary since 2005 | Director5, Deutsche Asset Management (since September 2005); Counsel, Morrison and Foerster LLP (1999–2005). | |
Caroline Pearson7 4/1/62 Assistant Secretary since 2002 | Managing Director5, Deutsche Asset Management. | |
Name, Date of Birth, | ||
Position with the Fund and | Business Experience and Directorships | |
Length of Time Served1,2 | During the Past 5 Years | |
Scott M. McHugh7 9/13/71 Assistant Treasurer since 2005 | Director5, Deutsche Asset Management. | |
Kathleen Sullivan D’Eramo 7 1/25/57 Assistant Treasurer since 2003 | Director5, Deutsche Asset Management. | |
John Robbins6 4/8/66 Anti-Money Laundering Compliance Officer since 2005 | Managing Director5, Deutsche Asset Management (since 2005); formerly, Chief Compliance Officer and Anti-Money Laundering Compliance Officer for GE Asset Management (1999–2005). | |
Philip Gallo6 8/2/62 Chief Compliance Officer since 2004 | Managing Director5, Deutsche Asset Management (2003–present). Formerly, Co-Head of Goldman Sachs Asset Management Legal (1994–2003). | |
A. Thomas Smith6,8 (1956) Chief Legal Officer since 2005 | Managing Director5, Deutsche Asset Management (2004–present); formerly, General Counsel, Morgan Stanley and Van Kampen and Investments (1999–2004); Vice President and Associate General Counsel, New York Life Insurance Company (1994–1999); senior attorney, The Dreyfus Corporation (1991–1993); senior attorney, Willkie Farr & Gallagher (1989–1991); staff attorney, US Securities & Exchange Commission and the Illinois Securities Department (1986–1989). | |
1 | Unless otherwise indicated, the mailing address of each Trustee and officer with respect to fund operations is One South Street, Baltimore, MD 21202. | |
2 | Length of time served represents the date that each Trustee or officer first began serving in that position with DWS Advisor Funds of which these funds are each a series. | |
3 | A publicly held company with securities registered pursuant to Section 12 of the Securities Exchange Act of 1934. | |
4 | Mr. Shiebler is a Trustee who is an “interested person” within the meaning of Section 2(a)(19) of the 1940 Act. Mr. Shiebler is a Managing Director of Deutsche Asset Management, the US asset management unit of Deutsche Bank AG and its affiliates. Mr. Shiebler’s business address is 345 Park Avenue, New York, New York 10154. | |
5 | Executive title, not a board directorship. | |
6 | Address: 345 Park Avenue, New York, New York 10154. | |
7 | Address: Two International Place, Boston, Massachusetts 02110. | |
8 | Elected on December 2, 2005. |
Investment Portfolio | as of December 31, 2005 |
Principal | |||||||||||
Cash Management Portfolio | Amount ($) | Value ($) | |||||||||
Certificates of Deposit and Bank Notes 26.5% | |||||||||||
Alliance & Leicester PLC, 4.02%, 9/6/2006 | 35,000,000 | 34,829,488 | |||||||||
American Express Centurion Bank, 4.31%, 1/20/2006 | 127,000,000 | 127,000,000 | |||||||||
Australia & New Zealand Banking Group Ltd., 3.59%, 5/30/2006 | 25,000,000 | 25,000,000 | |||||||||
Banco Bilbao Vizcaya Argentaria SA, 4.27%, 1/9/2006 | 100,000,000 | 99,998,043 | |||||||||
Bank of Tokyo-Mitsubishi: | |||||||||||
4.28%, 2/10/2006 | 50,000,000 | 50,000,000 | |||||||||
4.34%, 1/27/2006 | 65,000,000 | 65,000,000 | |||||||||
4.34%, 1/31/2006 | 150,000,000 | 150,000,000 | |||||||||
Barclays Bank PLC, 4.0%, 3/1/2006 | 80,000,000 | 80,000,000 | |||||||||
Calyon: | |||||||||||
3.27%, 3/6/2006 | 55,000,000 | 55,000,000 | |||||||||
4.75%, 11/14/2006 | 25,000,000 | 25,000,000 | |||||||||
Calyon North America, Inc., 4.16%, 8/8/2006 | 50,000,000 | 50,018,509 | |||||||||
Canadian Imperial Bank of Commerce: | |||||||||||
4.75%, 11/14/2006 | 25,000,000 | 25,000,000 | |||||||||
4.75%, 12/15/2006 | 40,000,000 | 40,000,000 | |||||||||
Credit Agricole SA: | |||||||||||
4.7%, 9/19/2006 | 40,000,000 | 40,000,000 | |||||||||
4.74%, 9/28/2006 | 50,000,000 | 50,000,000 | |||||||||
Depfa Bank PLC, 3.22%, 2/6/2006 | 101,000,000 | 101,000,000 | |||||||||
HBOS Treasury Services PLC: | |||||||||||
3.62%, 4/12/2006 | 60,000,000 | 60,000,000 | |||||||||
4.25%, 2/7/2006 | 32,000,000 | 31,998,532 | |||||||||
HSBC Bank PLC, 6.5%, 1/24/2006 | 11,550,000 | 11,573,020 | |||||||||
HSBC Bank USA, NA, 4.26%, 2/10/2006 | 50,000,000 | 49,999,725 | |||||||||
LaSalle Bank NA, 3.59%, 5/30/2006 | 50,000,000 | 50,000,000 | |||||||||
Natexis Banque Populaires, 4.31%, 2/1/2006 | 75,000,000 | 75,000,000 | |||||||||
Nordea Bank Finland PLC, 4.75%, 12/4/2006 | 40,000,000 | 40,000,000 | |||||||||
Norinchukin Bank, 4.3%, 1/31/2006 | 27,900,000 | 27,900,000 | |||||||||
Northern Rock PLC, 4.31%, 1/31/2006 | 100,000,000 | 100,000,000 | |||||||||
Royal Bank of Canada, 4.05%, 7/24/2006 | 35,000,000 | 35,000,000 | |||||||||
Royal Bank of Scotland PLC: | |||||||||||
4.4%, 10/4/2006 | 55,000,000 | 55,000,000 | |||||||||
4.75%, 11/14/2006 | 25,000,000 | 25,000,000 | |||||||||
Societe Generale: | |||||||||||
3.27%, 3/3/2006 | 86,000,000 | 86,000,000 | |||||||||
4.32%, 2/1/2006 | 105,000,000 | 105,000,000 | |||||||||
4.71%, 9/19/2006 | 35,000,000 | 35,001,224 | |||||||||
Tango Finance Corp., 4.045%, 7/25/2006 | 30,000,000 | 29,999,158 |
Principal | |||||||||||
Cash Management Portfolio | Amount ($) | Value ($) | |||||||||
Toronto Dominion Bank: | |||||||||||
3.6%, 6/7/2006 | 32,000,000 | 32,000,000 | |||||||||
3.71%, 5/19/2006 | 10,000,000 | 10,000,185 | |||||||||
3.72%, 6/7/2006 | 50,000,000 | 49,997,906 | |||||||||
3.73%, 6/23/2006 | 40,000,000 | 40,000,000 | |||||||||
3.75%, 5/16/2006 | 21,000,000 | 20,999,241 | |||||||||
3.95%, 7/31/2006 | 40,000,000 | 40,000,000 | |||||||||
UBS AG, 4.3%, 1/31/2006 | 100,000,000 | 100,000,000 | |||||||||
UniCredito Italiano SpA: | |||||||||||
3.73%, 4/12/2006 | 10,000,000 | 10,000,000 | |||||||||
4.29%, 2/1/2006 | 50,000,000 | 50,000,000 | |||||||||
Wells Fargo Bank, NA: | |||||||||||
4.3%, 1/25/2006 | 203,500,000 | 203,498,982 | |||||||||
4.31%, 1/20/2006 | 95,000,000 | 95,000,000 | |||||||||
4.31%, 1/26/2006 | 145,400,000 | 145,400,000 | |||||||||
Total Certificates of Deposit and Bank Notes (Cost $2,632,214,013) | 2,632,214,013 | ||||||||||
Commercial Paper** 32.0% | |||||||||||
AB Spintab, 3.92%, 2/28/2006 | 35,000,000 | 34,778,956 | |||||||||
Abbey National PLC, 4.45%, 1/3/2006 | 150,000,000 | 149,962,917 | |||||||||
Atlantic Asset Securitization LLC, 4.32%, 1/19/2006 | 91,875,000 | 91,676,550 | |||||||||
Atlantis One Funding Corp.: | |||||||||||
4.22%, 2/9/2006 | 100,000,000 | 99,542,833 | |||||||||
4.255%, 1/9/2006 | 70,000,000 | 69,933,811 | |||||||||
4.255%, 2/16/2006 | 85,000,000 | 84,537,860 | |||||||||
4.27%, 2/21/2006 | 130,000,000 | 129,213,608 | |||||||||
4.31%, 1/12/2006 | 27,808,000 | 27,771,378 | |||||||||
Cancara Asset Securitization LLC, 4.32%, 1/23/2006 | 35,144,000 | 35,051,220 | |||||||||
CC (USA), Inc., 3.96%, 1/20/2006 | 50,000,000 | 49,895,500 | |||||||||
Charta, LLC: | |||||||||||
4.26%, 2/7/2006 | 50,000,000 | 49,781,083 | |||||||||
4.35%, 1/23/2006 | 105,000,000 | 104,720,875 | |||||||||
CIT Group, Inc., 4.21%, 2/2/2006 | 8,500,000 | 8,468,191 | |||||||||
Compass Securitization LLC: | |||||||||||
4.29%, 1/31/2006 | 50,000,000 | 49,821,250 | |||||||||
4.35%, 1/23/2006 | 70,000,000 | 69,813,917 | |||||||||
CRC Funding, LLC, 4.32%, 1/27/2006 | 95,000,000 | 94,703,600 | |||||||||
Dorada Finance, Inc., 4.0%, 1/27/2006 | 51,500,000 | 51,351,222 | |||||||||
Falcon Asset Securitization Corp.: | |||||||||||
4.32%, 1/24/2006 | 66,687,000 | 66,502,944 | |||||||||
4.32%, 1/27/2006 | 41,454,000 | 41,324,664 | |||||||||
4.35%, 2/1/2006 | 61,433,000 | 61,202,882 | |||||||||
4.35%, 2/2/2006 | 107,913,000 | 107,495,736 |
Principal | |||||||||||
Cash Management Portfolio | Amount ($) | Value ($) | |||||||||
Giro Funding US Corp.: | |||||||||||
4.14%, 1/20/2006 | 33,250,000 | 33,177,349 | |||||||||
4.305%, 1/31/2006 | 50,000,000 | 49,820,625 | |||||||||
Greyhawk Funding LLC: | |||||||||||
4.22%, 2/7/2006 | 50,000,000 | 49,783,139 | |||||||||
4.23%, 2/7/2006 | 38,000,000 | 37,834,795 | |||||||||
Inter-American Development Bank, 4.12%, 1/31/2006 | 1,185,000 | 1,180,951 | |||||||||
Irish Life and Permanent PLC, 4.26%, 2/8/2006 | 75,000,000 | 74,662,750 | |||||||||
Jupiter Securitization Corp.: | |||||||||||
4.32%, 1/23/2006 | 24,405,000 | 24,340,571 | |||||||||
4.35%, 1/23/2006 | 58,105,000 | 57,950,538 | |||||||||
K2 (USA) LLC: | |||||||||||
3.96%, 1/23/2006 | 50,000,000 | 49,879,000 | |||||||||
4.0%, 1/27/2006 | 35,000,000 | 34,898,889 | |||||||||
4.21%, 2/3/2006 | 13,600,000 | 13,547,515 | |||||||||
Liberty Street Funding: | |||||||||||
4.35%, 1/25/2006 | 45,785,000 | 45,652,224 | |||||||||
4.35%, 1/31/2006 | 80,000,000 | 79,710,000 | |||||||||
Mane Funding Corp.: | |||||||||||
4.22%, 1/17/2006 | 75,000,000 | 74,859,333 | |||||||||
4.31%, 1/27/2006 | 44,803,000 | 44,663,538 | |||||||||
Nordea North America, Inc., 4.31%, 2/2/2006 | 36,000,000 | 35,862,080 | |||||||||
Park Avenue Receivables Co., LLC, 4.34%, 1/23/2006 | 46,783,000 | 46,658,921 | |||||||||
Perry Global Funding LLC: | |||||||||||
Series A, 4.22%, 1/10/2006 | 52,325,000 | 52,269,797 | |||||||||
Series A, 4.22%, 1/17/2006 | 35,000,000 | 34,934,356 | |||||||||
Series A, 4.225%, 2/7/2006 | 49,069,000 | 48,855,925 | |||||||||
Series A, 4.43%, 3/15/2006 | 74,091,000 | 73,425,436 | |||||||||
Preferred Receivables Funding Corp., 4.35%, 2/1/2006 | 25,311,000 | 25,216,189 | |||||||||
Rabobank USA Financial Corp., 4.15%, 1/3/2006 | 25,437,000 | 25,431,135 | |||||||||
Ranger Funding Co. LLC, 4.305%, 1/27/2006 | 98,944,000 | 98,636,367 | |||||||||
Sanofi-Aventis, 4.37%, 2/15/2006 | 50,000,000 | 49,726,875 | |||||||||
Scaldis Capital LLC, 4.32%, 1/9/2006 | 49,971,000 | 49,923,028 | |||||||||
Sheffield Receivables Corp.: | |||||||||||
4.31%, 1/17/2006 | 6,803,000 | 6,789,968 | |||||||||
4.32%, 1/23/2006 | 53,035,000 | 52,894,988 | |||||||||
4.32%, 1/24/2006 | 30,000,000 | 29,917,200 | |||||||||
Swedish National Housing Finance Corp., 3.925%, 3/2/2006 | 51,000,000 | 50,666,375 | |||||||||
The Concentrate Manufacturing Co. of Ireland, 4.26%, 1/6/2006 | 8,400,000 | 8,395,030 | |||||||||
The Goldman Sachs Group, Inc., 3.185%, 3/3/2006 | 30,000,000 | 29,838,096 | |||||||||
Tulip Funding Corp., 4.32%, 1/18/2006 | 220,365,000 | 219,915,455 |
Principal | |||||||||||
Cash Management Portfolio | Amount ($) | Value ($) | |||||||||
Windmill Funding Corp., 4.32%, 1/24/2006 | 53,750,000 | 53,601,650 | |||||||||
Yorktown Capital LLC, 4.32%, 1/24/2006 | 35,000,000 | 34,903,400 | |||||||||
Total Commercial Paper (Cost $3,177,374,485) | 3,177,374,485 | ||||||||||
Master Notes 1.1% | |||||||||||
Bear Stearns & Co., Inc., 4.4%*, 1/3/2006(a) (Cost $110,000,000) | 110,000,000 | 110,000,000 | |||||||||
US Government Sponsored Agencies 1.3% | |||||||||||
Federal National Mortgage Association: | |||||||||||
3.15%, 2/8/2006 | 32,000,000 | 31,985,356 | |||||||||
4.0%, 8/8/2006 | 50,000,000 | 50,000,000 | |||||||||
4.07%, 8/18/2006 | 40,000,000 | 40,000,000 | |||||||||
4.371%*, 12/22/2006 | 10,000,000 | 9,994,250 | |||||||||
Total US Government Sponsored Agencies (Cost $131,979,606) | 131,979,606 | ||||||||||
Funding Agreements* 2.5% | |||||||||||
GE Capital Assurance Co.: | |||||||||||
2.62%, 1/25/2006 | 75,000,000 | 75,000,000 | |||||||||
3.93%, 9/1/2006 | 60,000,000 | 60,000,000 | |||||||||
New York Life Insurance Co., 4.57%, 9/19/2006 | 80,000,000 | 80,000,000 | |||||||||
Travelers Insurance Co., 3.47%, 3/31/2006 | 30,000,000 | 30,000,000 | |||||||||
Total Funding Agreements (Cost $245,000,000) | 245,000,000 | ||||||||||
Promissory Notes* 3.7% | |||||||||||
The Goldman Sachs Group, Inc.: | |||||||||||
3.871%, 6/23/2006 | 140,000,000 | 140,000,000 | |||||||||
4.35%, 2/16/2006 | 200,000,000 | 200,000,000 | |||||||||
4.37%, 6/23/2006 | 30,000,000 | 30,000,000 | |||||||||
Total Promissory Notes (Cost $370,000,000) | 370,000,000 | ||||||||||
Short Term Notes* 21.2% | |||||||||||
American Express Centurion Bank, 4.3%, 8/8/2006 | 30,000,000 | 30,000,000 | |||||||||
Australia & New Zealand Banking Group Ltd., 4.15%, 6/23/2006 | 30,000,000 | 30,000,000 | |||||||||
Beta Finance, Inc., 144A, 3.56%, 4/10/2006 | 45,000,000 | 45,004,021 |
Principal | |||||||||||
Cash Management Portfolio | Amount ($) | Value ($) | |||||||||
Branch Banking & Trust Co., 3.27%, 3/15/2006 | 165,000,000 | 164,990,914 | |||||||||
Citigroup, Inc., 4.63%, 3/20/2006 | 100,000,000 | 100,036,175 | |||||||||
Commonwealth Bank of Australia, 4.0%, 8/24/2006 | 40,000,000 | 40,000,000 | |||||||||
Credit Suisse: | |||||||||||
3.98%, 9/28/2006 | 150,000,000 | 150,000,000 | |||||||||
4.02%, 9/26/2006 | 93,000,000 | 93,000,000 | |||||||||
4.49%, 9/26/2006 | 90,000,000 | 90,000,000 | |||||||||
Greenwich Capital Holdings, Inc., 3.64%, 4/4/2006 | 75,000,000 | 75,000,000 | |||||||||
Harris Trust & Savings Bank, 4.07%, 2/2/2006 | 30,000,000 | 29,999,869 | |||||||||
HSBC Finance Corp., 4.02%, 3/24/2006 | 25,000,000 | 25,000,000 | |||||||||
International Business Machines Corp., 4.329%, 3/8/2006 | 66,000,000 | 66,000,000 | |||||||||
M&I Marshall & Ilsley Bank, 4.349%, 12/15/2006 | 56,000,000 | 56,000,000 | |||||||||
Merrill Lynch & Co., Inc.: | |||||||||||
4.12%, 1/4/2006 | 35,000,000 | 35,000,000 | |||||||||
4.349%, 9/15/2006 | 35,000,000 | 35,000,000 | |||||||||
Morgan Stanley, 4.29%, 7/10/2006 | 225,000,000 | 225,000,000 | |||||||||
Nationwide Building Society, 144A, 4.41%, 1/13/2006 | 45,000,000 | 45,001,108 | |||||||||
Pfizer Investment Capital PLC, 4.329%, 12/15/2006 | 50,000,000 | 50,000,000 | |||||||||
Skandinaviska Enskila Banken, 4.38%, 7/18/2006 | 50,000,000 | 50,000,000 | |||||||||
SunTrust Bank, Atlanta, 4.19%, 4/28/2006 | 250,000,000 | 250,000,000 | |||||||||
Tango Finance Corp., 144A, 4.32%, 2/10/2006 | 25,000,000 | 24,999,733 | |||||||||
UniCredito Italiano SpA: | |||||||||||
3.96%, 6/30/2006 | 75,000,000 | 74,981,298 | |||||||||
4.01%, 10/4/2006 | 100,000,000 | 99,963,152 | |||||||||
4.34%, 2/28/2006 | 150,000,000 | 149,991,003 | |||||||||
4.43%, 6/14/2006 | 75,000,000 | 74,975,571 | |||||||||
Total Short Term Notes (Cost $2,109,942,844) | 2,109,942,844 | ||||||||||
Time Deposit 4.3% | |||||||||||
Bank of Montreal, 3.375%, 1/3/2006 | 125,000,000 | 125,000,000 | |||||||||
National Australia Bank Ltd., 3.5%, 1/3/2006 | 113,800,000 | 113,800,000 | |||||||||
Nordia Bank AB, 3.5%, 1/3/2006 | 183,707,041 | 183,707,041 | |||||||||
Total Time Deposit (Cost $422,507,041) | 422,507,041 | ||||||||||
Repurchase Agreements 7.0% | |||||||||||
Banc of America Securities LLC, 4.27%, dated 12/30/2005, to be repurchased at $88,201,973 on 1/3/2006 (b) | 88,160,146 | 88,160,146 | |||||||||
Countrywide Securities Corp., 4.29%, dated 12/30/2005, to be repurchased at $500,238,333 on 1/3/2006 (c) | 500,000,000 | 500,000,000 |
Principal | ||||||||||
Cash Management Portfolio | Amount ($) | Value ($) | ||||||||
JPMorgan Securities, Inc., 3.45%, dated 12/30/2005, to be repurchased at $7,657,239 on 1/3/2006 (d) | 7,654,305 | 7,654,305 | ||||||||
UBS Securities LLC, 4.3%, dated 12/30/2005, to be repurchased at $100,047,778 on 1/3/2006 (e) | 100,000,000 | 100,000,000 | ||||||||
Total Repurchase Agreements (Cost $695,814,451) | 695,814,451 |
% of | ||||||||||
Net Assets | Value ($) | |||||||||
Total Investment Portfolio (Cost $9,894,832,440)† | 99.6 | 9,894,832,440 | ||||||||
Other Assets and Liabilities, Net | 0.4 | 36,533,278 | ||||||||
Net Assets | 100.0 | 9,931,365,718 |
* | Floating rate notes are securities whose yields vary with a designated market index or market rate, such as the coupon-equivalent of the US Treasury bill rate. These securities are shown at their current rate as of December 31, 2005. | |
** | Annualized yield at time of purchase; not a coupon rate. | |
† | The cost for federal income tax purposes was $9,894,832,440. | |
(a) | Reset date; not a maturity date. | |
(b) | Collateralized by: |
Principal | Rate | Maturity | Collateral | |||||||||||||||
Amount ($) | Security | (%) | Date | Value ($) | ||||||||||||||
50,875,461 | Federal Home Loan Mortgage Corp. | 4.5– 5.5 | 12/1/2020– 8/1/2035 | 50,193,283 | ||||||||||||||
40,459,637 | Federal National Mortgage Association | 5.0– 5.5 | 3/1/2020– 8/1/2035 | 40,611,667 | ||||||||||||||
Total Collateral Value | 90,804,950 |
(c) | Collateralized by: |
Principal | Rate | Maturity | Collateral | |||||||||||||||
Amount ($) | Security | (%) | Date | Value ($) | ||||||||||||||
2,665,000 | Federal Home Loan Bank | 3.25– 4.625 | 8/2/2007– 3/16/2015 | 2,673,765 | ||||||||||||||
122,027,394 | Federal Home Loan Mortgage Corp. | 3.567– 6.5 | 9/1/2015– 12/1/2035 | 121,413,094 | ||||||||||||||
380,381,976 | Federal National Mortgage Association | 3.204– 8.0 | 12/1/2012– 1/1/2036 | 384,727,343 | ||||||||||||||
4,009,815 | Government National Mortgage Association | 4.5 | 2/15/2018 | 3,951,909 | ||||||||||||||
Total Collateral Value | 512,766,111 |
(d) | Collateralized by $8,285,000 US Treasury Note, STRIPS, maturing on 5/15/2007 with a value of $7,810,021. |
(e) | Collateralized by: |
Principal | Rate | Maturity | Collateral | |||||||||||||||
Amount ($) | Security | (%) | Date | Value ($) | ||||||||||||||
70,078,848 | Federal National Mortgage Association, STRIPS, Interest Only | 4.5 | 12/1/2035 | 10,719,961 | ||||||||||||||
124,185,206 | Federal National Mortgage Association, STRIPS, Principal Only | — | 4/1/2032- 2/1/2035 | 92,281,814 | ||||||||||||||
Total Collateral Value | 103,001,775 |
Investment Portfolio | as of December 31, 2005 |
Principal | |||||||||||
Treasury Money Portfolio | Amount ($) | Value ($) | |||||||||
US Treasury Obligations 20.5% | |||||||||||
US Treasury Bills: | |||||||||||
3.98%*, 4/20/2006 | 13,500,000 | 13,337,317 | |||||||||
3.725%*, 3/23/2006 | 25,000,000 | 24,790,469 | |||||||||
US Treasury Note: | |||||||||||
1.875%, 1/31/2006 | 28,000,000 | 27,964,493 | |||||||||
2.375%, 8/15/2006 | 15,500,000 | 15,367,374 | |||||||||
2.75%, 7/31/2006 | 31,000,000 | 30,714,296 | |||||||||
Total US Treasury Obligations (Cost $112,173,949) | 112,173,949 | ||||||||||
Repurchase Agreements** 79.3% | |||||||||||
Citigroup Global Markets, Inc., 4.25%, dated 12/8/2005, to be repurchased at $85,541,875 on 1/31/2006 (a) | 85,000,000 | 85,000,000 | |||||||||
Credit Suisse First Boston LLC, 3.5%, dated 12/30/2005, to be repurchased at $130,050,556 on 1/3/2006 (b) | 130,000,000 | 130,000,000 | |||||||||
JPMorgan Securities, Inc., 3.45%, dated 12/30/2005, to be repurchased at $110,387,994 on 1/3/2006 (c) | 110,345,695 | 110,345,695 | |||||||||
UBS Securities LLC, 3.51%, dated 12/30/2005, to be repurchased at $110,042,900 on 1/3/2006 (d) | 110,000,000 | 110,000,000 | |||||||||
Total Repurchase Agreements (Cost $435,345,695) | 435,345,695 |
% of | ||||||||||
Net Assets | ||||||||||
Total Investment Portfolio (Cost $547,519,644)† | 99.8 | 547,519,644 | ||||||||
Other Assets and Liabilities, Net | 0.2 | 982,866 | ||||||||
Net Assets | 100.0 | 548,502,510 |
† | The cost for federal income tax purposes was $547,519,644. | |
* | Annualized yield at time of purchase; not a coupon rate. | |
** | Repurchase agreements are fully collateralized by US Treasury, Government agency or other securities. | |
(a) | Collateralized by $85,599,138 Government National Mortgage Association, 5.5%, maturing on 7/15/2033 with a value of $86,700,000. | |
(b) | Collateralized by $188,630,875 US Treasury STRIPS, Zero Coupon, with various maturities of 2/15/2006-2/15/2031 with a value of $132,600,497. | |
(c) | Collateralized by $122,093,000 US Treasury STRIPS, Zero Coupon, with various maturities of 2/15/2006-8/15/2022 with a value of $112,553,432. | |
(d) | Collateralized by $94,595,000 US Treasury Inflation Index Bond, 3.0%, maturing on 7/15/2012 with a value of $112,202,885. |
Financial Statements |
Statements of Assets and Liabilities as of December 31, 2005 |
Cash | ||||||||||
Management | Treasury Money | |||||||||
Assets | Portfolio | Portfolio | ||||||||
Investments: | ||||||||||
Investments in securities, at amortized cost | $ | 9,894,832,440 | $ | 112,173,949 | ||||||
Repurchase agreements, at amortized cost | — | 435,345,695 | ||||||||
Total investments in securities, at amortized cost | 9,894,832,440 | 547,519,644 | ||||||||
Cash | 2,287,298 | 62,042 | ||||||||
Interest receivable | 35,125,218 | 1,014,276 | ||||||||
Other assets | 549,276 | 12,059 | ||||||||
Total assets | 9,932,794,232 | 548,608,021 | ||||||||
Liabilities | ||||||||||
Accrued advisory fee | 1,013,976 | 55,024 | ||||||||
Accrued administrator service fee | 409,043 | 25,970 | ||||||||
Other accrued expenses and payables | 5,495 | 24,517 | ||||||||
Total liabilities | 1,428,514 | 105,511 | ||||||||
Net assets, at value | $ | 9,931,365,718 | $ | 548,502,510 | ||||||
Statements of Operations for the year ended December 31, 2005 |
Cash | ||||||||||
Management | Treasury Money | |||||||||
Investment Income | Portfolio | Portfolio | ||||||||
Income: | ||||||||||
Interest | $ | 325,481,697 | $ | 19,070,184 | ||||||
Expenses: | ||||||||||
Advisory fee | 14,956,589 | 902,567 | ||||||||
Administrator service fee | 4,985,530 | 300,856 | ||||||||
Auditing | 50,366 | 49,055 | ||||||||
Legal | 31,069 | 24,879 | ||||||||
Trustees’ fees and expenses | 340,320 | 28,432 | ||||||||
Other | 284,804 | 35,714 | ||||||||
Total expenses, before expense reductions | 20,648,678 | 1,341,503 | ||||||||
Expense reductions | (2,822,888 | ) | (148,551 | ) | ||||||
Total expenses, after expense reductions | 17,825,790 | 1,192,952 | ||||||||
Net investment income | 307,655,907 | 17,877,232 | ||||||||
Net realized gain (loss) from investment transactions | 117,517 | (31,631 | ) | |||||||
Net increase (decrease) in net assets resulting from operations | $ | 307,773,424 | $ | 17,845,601 | ||||||
Statement of Changes in Net Assets — Cash Management Portfolio |
Years Ended December 31, | ||||||||||
Increase (Decrease) in Net Assets | 2005 | 2004 | ||||||||
Operations: | ||||||||||
Net investment income | $ | 307,655,907 | $ | 143,447,885 | ||||||
Net realized gain (loss) on investment transactions | 117,517 | 91,685 | ||||||||
Net increase (decrease) in net assets resulting from operations | 307,773,424 | 143,539,570 | ||||||||
Capital transaction in shares of beneficial interest: | ||||||||||
Proceeds from capital invested | 112,816,875,647 | 122,171,335,290 | ||||||||
Value of capital withdrawn | (113,004,956,853 | ) | (125,052,740,207 | ) | ||||||
Net increase (decrease) in net assets from capital transactions in shares of beneficial interest | (188,081,206 | ) | (2,881,404,917 | ) | ||||||
Increase (decrease) in net assets | 119,692,218 | (2,737,865,347 | ) | |||||||
Net assets at beginning of period | 9,811,673,500 | 12,549,538,847 | ||||||||
Net assets at end of period | $ | 9,931,365,718 | $ | 9,811,673,500 | ||||||
Statement of Changes in Net Assets — Treasury Money Portfolio |
Years Ended December 31, | ||||||||||
Increase (Decrease) in Net Assets | 2005 | 2004 | ||||||||
Operations: | ||||||||||
Net investment income | $ | 17,877,232 | $ | 7,183,965 | ||||||
Net realized gain (loss) on investment transactions | (31,631 | ) | (27,920 | ) | ||||||
Net increase (decrease) in net assets resulting from operations | 17,845,601 | 7,156,045 | ||||||||
Capital transaction in shares of beneficial interest: | ||||||||||
Proceeds from capital invested | 5,132,247,419 | 4,272,706,695 | ||||||||
Value of capital withdrawn | (5,159,742,942 | ) | (4,558,200,803 | ) | ||||||
Net increase (decrease) in net assets from capital transactions in shares of beneficial interest | (27,495,523 | ) | (285,494,108 | ) | ||||||
Increase (decrease) in net assets | (9,649,922 | ) | (278,338,063 | ) | ||||||
Net assets at beginning of period | 558,152,432 | 836,490,495 | ||||||||
Net assets at end of period | $ | 548,502,510 | $ | 558,152,432 | ||||||
Financial Highlights |
Years Ended December 31, | 2005 | 2004 | 2003 | 2002 | 2001 | |||||||||||||||||
Ratios to Average Net Assets and Supplemental Data | ||||||||||||||||||||||
Net assets, end of period ($ millions) | 9,931 | 9,812 | 12,550 | 11,237 | 10,864 | |||||||||||||||||
Ratio of expenses before expense reductions (%) | .21 | .21 | .21 | .20 | .20 | |||||||||||||||||
Ratio of expenses after expense reductions (%) | .18 | .18 | .18 | .18 | .18 | |||||||||||||||||
Ratio of net investment income (%) | 3.08 | 1.22 | 1.04 | 1.71 | 4.04 | |||||||||||||||||
Total Return (%)a,b | 3.15 | 1.26 | 1.06 | 1.72 | — | |||||||||||||||||
Years Ended December 31, | 2005 | 2004 | 2003 | 2002 | 2001 | |||||||||||||||||
Ratios to Average Net Assets and Supplemental Data | ||||||||||||||||||||||
Net assets, end of period ($ millions) | 549 | 558 | 836 | 795 | 811 | |||||||||||||||||
Ratio of expenses before expense reductions (%) | .22 | .22 | .21 | .21 | .21 | |||||||||||||||||
Ratio of expenses after expense reductions (%) | .20 | .20 | .20 | .20 | .20 | |||||||||||||||||
Ratio of net investment income (%) | 2.97 | 1.12 | .95 | 1.56 | 3.94 | |||||||||||||||||
Total Return (%)a,c | 3.01 | 1.17 | .96 | 1.60 | — | |||||||||||||||||
a | Total return would have been lower had certain expenses not been reduced. | |
b | Total return for the Cash Management Portfolio was derived from the performance of Cash Reserves Fund Institutional. | |
c | Total return for the Treasury Money Portfolio was derived from the performance of Treasury Money Fund—Institutional Class. |
Notes to Financial Statements |
Total | Amount | Annualized | ||||||||||||
Aggregated | Waived | Effective Rate | ||||||||||||
Cash Management Portfolio | $ | 14,956,589 | $ | 2,700,770 | .12 | % | ||||||||
Treasury Money Portfolio | $ | 902,567 | $ | 138,078 | .13 | % | ||||||||
DeAM expects to reach final agreements with regulators early in 2006 regarding allegations of improper trading in the DWS funds. DeAM expects that it will reach settlement agreements with the Securities and Exchange Commission, the New York Attorney General and the Illinois Secretary of State providing for payment of disgorgement, penalties, and investor education contributions totaling approximately $134 million. Approximately $127 million of this amount would be distributed to shareholders of the affected DWS funds in accordance with a distribution plan to be developed by an independent distribution consultant. DeAM does not believe that any of the DWS funds will be named as respondents or defendants in any proceedings. The funds’ investment advisors do not believe these amounts will have a material adverse financial impact on them |
or materially affect their ability to perform under their investment management agreements with the DWS funds. The above-described amounts are not material to Deutsche Bank, and they have already been reserved. | |
Based on the settlement discussions thus far, DeAM believes that it will be able to reach a settlement with the regulators on a basis that is generally consistent with settlements reached by other advisors, taking into account the particular facts and circumstances of market timing at DeAM and at the legacy Scudder and Kemper organizations prior to their acquisition by DeAM in April 2002. Among the terms of the expected settled orders, DeAM would be subject to certain undertakings regarding the conduct of its business in the future, including maintaining existing management fee reductions for certain funds for a period of five years. DeAM expects that these settlements would resolve regulatory allegations that it violated certain provisions of federal and state securities laws (i) by entering into trading arrangements that permitted certain investors to engage in market timing in certain DWS funds and (ii) by failing more generally to take adequate measures to prevent market timing in the DWS funds, primarily during the 1999–2001 period. With respect to the trading arrangements, DeAM expects that the settlement documents will include allegations related to one legacy DeAM arrangement, as well as three legacy Scudder and six legacy Kemper arrangements. All of these trading arrangements originated in businesses that existed prior to the current DeAM organization, which came together in April 2002 as a result of the various mergers of the legacy Scudder, Kemper and Deutsche fund groups, and all of the arrangements were terminated prior to the start of the regulatory investigations that began in the summer of 2003. No current DeAM employee approved the trading arrangements. |
Report of Independent Registered Public Accounting Firm |
Investment Management Agreement Approval |
n | At the present time, all but one of the Portfolio’s and the Fund’s Trustees are independent of the Advisor and its affiliates. | |
n | The Trustees meet frequently to discuss fund matters. Each year, the Trustees dedicate part or all of several meetings to contract review matters. | |
n | The Trustees regularly meet privately with their independent counsel (and, as needed, other advisors) to discuss contract review and other matters. |
n | The investment management fee schedule for the Fund, including (i) comparative information provided by Lipper regarding investment management fee rates paid to other investment advisors by similar funds and (ii) fee rates paid to the Advisor by similar funds and institutional accounts advised by the Advisor. With respect to management fees paid to other investment advisors by similar funds, the Trustees noted that the fee rate paid by the Fund was lower than the median (1st quartile) of the applicable Lipper universe as of December 31, 2004. The Board gave only limited consideration to fees paid by similar institutional accounts advised by the Advisor, in light of the material differences in the scope of services provided to mutual funds as compared to those provided to institutional accounts. The Board concluded that the fee schedule in effect for the Fund represented reasonable compensation in light of the nature, extent and quality of the services being provided to the Portfolio, the performance of the Portfolio and fees paid by similar funds. | |
n | The extent to which economies of scale would be realized as the Portfolio grows. In this regard, the Board noted that the Portfolio’s investment management fee schedule includes no fee breakpoints but concluded that the fee schedule is appropriate given current asset levels. | |
n | The total operating expense of the Fund relative to the Fund’s peer group as determined by Lipper. In this regard, the Board noted that the total expenses of the Fund for the year ended December 31, 2004 were more than the median (3rd quartile) of the applicable Lipper universe. The Board also considered the expense limitations agreed to by the Advisor that serve to ensure that the Fund’s total operating expenses would be competitive relative to the applicable Lipper universe. | |
n | The investment performance of the Fund and the Advisor relative to industry peer groups. The Board noted that for the one-, three- and five-year periods ended June 30, 2005, the Fund’s performance was in the 2nd, 3rd and 3nd quartiles, respectively of the applicable iMoneyNet universe. The Board also observed that the Fund outperformed its benchmark in the one-year period but underperformed in the three- and five-year periods. The |
Board recognized that the Advisor has made significant changes in its investment personnel and processes in recent years in an effort to improve long-term performance. | ||
n | The nature, extent and quality of the advisory services provided by the Advisor. The Board considered extensive information regarding the Advisor, including the Advisor’s personnel, particularly those personnel with responsibilities for providing services to the Portfolio, resources, policies and investment processes. The Board also considered the terms of the current investment management agreement, including the scope of services provided under the agreement. In this regard, the Board concluded that the quality and range of services provided by the Advisor have benefited, and should continue to benefit, the Fund and its shareholders. | |
n | The costs of the services to, and profits realized by, the Advisor and its affiliates from their relationships with the Portfolio and the Fund. The Board reviewed information concerning the costs incurred and profits realized by the Advisor during 2004 from providing investment management services to the Portfolio and, separately, to the entire DWS fund complex, and reviewed with the Advisor the cost allocation methodology used to determine its profitability. In analyzing the Advisor’s costs and profits, the Board also reviewed the fees paid to, and services provided to the Fund by the Advisor and its affiliates. As part of this review, the Board considered information provided by an independent accounting firm engaged to review the Advisor’s cost allocation methodology and calculations. The Board concluded that the Portfolio’s investment management fee schedule represented reasonable compensation in light of the costs incurred by the Advisor and its affiliates in providing services to the Portfolio and the Fund. The Board also reviewed information regarding the profitability of certain similar investment management firms. The Board noted that while information regarding the profitability of such firms is limited, the Advisor’s overall profitability with respect to the DWS fund complex (after taking into account distribution and other services provided by the Advisor and its affiliates) was lower than the overall profitability levels of most comparable firms for which such data was available. | |
n | The practices of the Advisor regarding the selection and compensation of brokers and dealers executing portfolio transactions for the Portfolio, |
including the Advisor’s soft dollar practices. In this regard, the Board observed that the Advisor had voluntarily terminated the practice of allocating brokerage commissions to acquire research services from third-party service providers. The Board indicated that it would continue to monitor the Portfolio’s trading activities to ensure that the principle of “best price and execution” remains paramount in the portfolio trading process. | ||
n | The Advisor’s commitment to, and record of, compliance including its written compliance policies and procedures. In this regard, the Board considered the Advisor’s commitment to indemnify the Fund against any costs and liabilities related to lawsuits or regulatory actions making allegations regarding market timing, revenue sharing, fund valuation or other subjects arising from or relating to pending regulatory inquiries. The Board also considered the significant attention and resources dedicated by the Advisor to documenting and enhancing its compliance processes in recent years. The Board noted in particular (i) the experience and seniority of the Advisor’s chief compliance officer, who reports to the Board, (ii) the large number of compliance personnel who report to the Advisor’s chief compliance officer, and (iii) the substantial commitment of resources by the Advisor to compliance matters. | |
n | Deutsche Bank’s commitment to restructuring and growing its US mutual fund business. The Board considered recent and ongoing efforts by Deutsche Bank to restructure its US mutual fund business to improve efficiency and competitiveness and to reduce compliance and operational risk. The Board considered assurances received from Deutsche Bank that it would commit the resources necessary to maintain high quality services to the Portfolio and the Fund and its shareholders as long as they remained in existence and while various organizational initiatives are being implemented. The Board also considered Deutsche Bank’s strategic plans for investing in the growth of its US mutual fund business and the potential benefits to the Fund’s shareholders. |
n | At the present time, all but one of the Portfolio’s and the Fund’s Trustees are independent of the Advisor and its affiliates. | |
n | The Trustees meet frequently to discuss fund matters. Each year, the Trustees dedicate part or all of several meetings to contract review matters. | |
n | The Trustees regularly meet privately with their independent counsel (and, as needed, other advisors) to discuss contract review and other matters. |
n | The investment management fee schedule for the Fund, including (i) comparative information provided by Lipper regarding investment management fee rates paid to other investment advisors by similar funds and (ii) fee rates paid to the Advisor by similar funds and institutional accounts advised by the Advisor. With respect to management fees paid to other investment advisors by similar funds, the Trustees noted that the fee rate paid by the Fund was lower than the median (1st quartile) of the applicable Lipper universe as of December 31, 2004. The Board gave only limited consideration to fees paid by similar institutional accounts advised by the Advisor, in light of the material differences in the scope of services provided to mutual funds as compared to those provided to institutional accounts. The Board concluded that the fee schedule in effect for the Fund represented reasonable compensation in light of the nature, extent and quality of the services being provided to the Portfolio, the performance of the Portfolio and fees paid by similar funds. | |
n | The extent to which economies of scale would be realized as the Portfolio grows. In this regard, the Board noted that the Portfolio’s investment management fee schedule includes no fee breakpoints but that the Portfolio’s total assets are less than $600 million. The Board concluded that the Fund’s fee schedule is appropriate given current asset levels. | |
n | The total operating expense of the Fund relative to the Fund’s peer group as determined by Lipper. In this regard, the Board noted that the total expenses of the Fund for the year ending December 31, 2004 were higher than the median (3rd quartile) of the applicable Lipper universe. The Board also considered the expense limitations agreed to by the Advisor that serve to ensure that the Fund’s total operating expenses would be competitive relative to the applicable Lipper universe. | |
n | The investment performance of the Fund and the Advisor relative to industry peer groups. The Board noted that for the one-, three- and five- |
year periods ended June 30, 2005, the Fund’s performance was in the 2nd, 3rd, and 3rd quartiles, respectively, of the applicable iMoneyNet universe. The Board also observed that the Fund outperformed its benchmark in the one-year period, but slightly underperformed its benchmark in the three- and five-year periods. The Board recognized that the Advisor has made significant changes in its investment personnel and processes in recent years in an effort to improve long-term performance. | ||
n | The nature, extent and quality of the advisory services provided by the Advisor. The Board considered extensive information regarding the Advisor, including the Advisor’s personnel, particularly those personnel with responsibilities for providing services to the Portfolio, resources, policies and investment processes. The Board also considered the terms of the current investment management agreement, including the scope of services provided under the agreement. In this regard, the Board concluded that the quality and range of services provided by the Advisor have benefited, and should continue to benefit, the Fund and its shareholders. | |
n | The costs of the services to, and profits realized by, the Advisor and its affiliates from their relationships with the Portfolio and the Fund. The Board reviewed information concerning the costs incurred and profits realized by the Advisor during 2004 from providing investment management services to the Portfolio and, separately, to the entire DWS fund complex, and reviewed with the Advisor the cost allocation methodology used to determine its profitability. In analyzing the Advisor’s costs and profits, the Board also reviewed the fees paid to, and services provided to the Fund by the Advisor and its affiliates with respect to administrative services, fund accounting, shareholder servicing and distribution (including fees paid pursuant to 12b-1 plans). As part of this review, the Board considered information provided by an independent accounting firm engaged to review the Advisor’s cost allocation methodology and calculations. The Board concluded that the Portfolio’s investment management fee schedule represented reasonable compensation in light of the costs incurred by the Advisor and its affiliates in providing services to the Portfolio and the Fund. The Board also reviewed information regarding the profitability of certain similar investment management firms. The Board noted that while information regarding the profitability of such firms is limited, the Advisor’s overall profitability with respect to the DWS fund complex (after taking into |
account distribution and other services provided by the Advisor and its affiliates) was lower than the overall profitability levels of most comparable firms for which such data was available. | ||
n | The practices of the Advisor regarding the selection and compensation of brokers and dealers executing portfolio transactions for the Portfolio, including the Advisor’s soft dollar practices. In this regard, the Board observed that the Advisor had voluntarily terminated the practice of allocating brokerage commissions to acquire research services from third-party service providers. The Board indicated that it would continue to monitor the Portfolio’s trading activities to ensure that the principle of “best price and execution” remains paramount in the portfolio trading process. | |
n | The Advisor’s commitment to, and record of, compliance including its written compliance policies and procedures. In this regard, the Board considered the Advisor’s commitment to indemnify the Fund against any costs and liabilities related to lawsuits or regulatory actions making allegations regarding market timing, revenue sharing, fund valuation or other subjects arising from or relating to pending regulatory inquiries. The Board also considered the significant attention and resources dedicated by the Advisor to documenting and enhancing its compliance processes in recent years. The Board noted in particular (i) the experience and seniority of the Advisor’s chief compliance officer, who reports to the Board, (ii) the large number of compliance personnel who report to the Advisor’s chief compliance officer, and (iii) the substantial commitment of resources by the Advisor to compliance matters. | |
n | Deutsche Bank’s commitment to restructuring and growing its US mutual fund business. The Board considered recent and ongoing efforts by Deutsche Bank to restructure its US mutual fund business to improve efficiency and competitiveness and to reduce compliance and operational risk. The Board considered assurances received from Deutsche Bank that it would commit the resources necessary to maintain high quality services to the Portfolio and the Fund and its shareholders as long as they remained in existence and while various organizational initiatives are being implemented. The Board also considered Deutsche Bank’s strategic plans for investing in the growth of its US mutual fund business and the potential benefits to the Fund’s shareholders. |
Account Management Resources |
Automated Information Lines | Institutional Investor Services (800) 730-1313 Personalized account information, information on other DeAM funds and services via touchtone telephone and the ability to exchange or redeem shares. | |||||
Web Site | moneyfunds.deam-us.db.com View your account transactions and balances, trade shares, monitor your asset allocation, and change your address, 24 hours a day. Obtain prospectuses and applications, blank forms, interactive worksheets, news about the funds, subscription to fund updates by e-mail, retirement planning information, and more. | |||||
For More Information | (800) 730-1313, option 1 To speak with a fund service representative. | |||||
Written Correspondence | Deutsche Asset Management PO Box 219210 Kansas City, MO 64121-9210 | |||||
Proxy Voting | A description of the fund’s policies and procedures for voting proxies for portfolio securities and information about how the fund voted proxies related to its portfolio securities during the 12-month period ended June 30 is available on our Web site — www.dws-scudder.com (type ‘proxy voting‘ in the search field) — or on the SEC’s Web site — www.sec.gov. To obtain a written copy of the fund’s policies and procedures without charge, upon request, call us toll free at (800) 621-1048. | |||||
Principal Underwriter | If you have questions, comments or complaints, contact: DWS Scudder Distributors, Inc. 222 South Riverside Plaza Chicago, IL 60606-5808 (800) 621-1148 | |||||
Cash Management Fund Investment | Treasury Money Fund Investment | |||||
Nasdaq Symbol | BCSXX | BTTXX | ||||
CUSIP Number | 23336Y 722 | 23336Y 680 | ||||
Fund Number | 834 | 835 | ||||
Notes |
Notes |
Notes |
Notes |
| ITEM 2. | CODE OF ETHICS. |
As of the end of the period, December 31, 2005, DWS Advisor Funds has adopted a code of ethics, as defined in Item 2 of Form N-CSR, that applies to its Principal Executive Officer and Principal Financial Officer.
There have been no amendments to, or waivers from, a provision of the code of ethics during the period covered by this report that would require disclosure under Item 2.
A copy of the code of ethics is filed as an exhibit to this Form N-CSR.
| ITEM 3. | AUDIT COMMITTEE FINANCIAL EXPERT. |
The Fund’s Board of Directors/Trustees has determined that the Fund has at least one “audit committee financial expert” serving on its audit committee: Mr. Graham E. Jones. This audit committee member is “independent,” meaning that he is not an “interested person” of the Fund (as that term is defined in Section 2(a)(19) of the Investment Company Act of 1940) and he does not accept any consulting, advisory, or other compensatory fee from the Fund (except in the capacity as a Board or committee member).
An “audit committee financial expert” is not an “expert” for any purpose, including for purposes of Section 11 of the Securities Act of 1933, as a result of being designated as an “audit committee financial expert.” Further, the designation of a person as an “audit committee financial expert” does not mean that the person has any greater duties, obligations, or liability than those imposed on the person without the “audit committee financial expert” designation. Similarly, the designation of a person as an “audit committee financial expert” does not affect the duties, obligations, or liability of any other member of the audit committee or board of directors.
| ITEM 4. | PRINCIPAL ACCOUNTANT FEES AND SERVICES. |
CASH MANAGEMENT FUND INVESTMENT
FORM N-CSR DISCLOSURE RE: AUDIT FEES
The following table shows the amount of fees that PricewaterhouseCoopers, LLP (“PWC”), the Fund’s independent registered public accounting firm, billed to the Fund during the Fund’s last two fiscal years. The Audit Committee approved in advance all audit services and non-audit services that PWC provided to the Fund.
The Audit Committee has delegated certain pre-approval responsibilities to its Chairman (or, in his absence, any other member of the Audit Committee).
Services that the Fund’s Independent Registered Public Accounting Firm Billed to the Fund
Fiscal Year | Audit Fees Billed to Fund | Audit-Related | Tax Fees Billed to Fund | All |
2005 | $15,350 | $225 | $0 | $0 |
2004 | $14,300 | $185 | $3,255 | $0 |
The above “Audit- Related Fees” were billed for agreed upon procedures performed and the above "Tax Fees" were billed for professional services rendered for tax compliance and tax return preparation.
Services that the Fund’s Independent Registered Public Accounting Firm Billed to the Adviser and Affiliated Fund Service Providers
The following table shows the amount of fees billed by PWC to Deutsche Investment Management Americas, Inc. (“DeIM” or the “Adviser”), and any entity controlling, controlled by or under common control with DeIM (“Control Affiliate”) that provides ongoing services to the Fund (“Affiliated Fund Service Provider”), for engagements directly related to the Fund’s operations and financial reporting, during the Fund’s last two fiscal years.
Fiscal Year | Audit-Related | Tax Fees Billed to Adviser and Affiliated Fund Service Providers | All |
2005 | $268,900 | $197,605 | $0 |
2004 | $431,907 | $0 | $0 |
The “Audit-Related Fees” were billed for services in connection with the assessment of internal controls, agreed-upon procedures and additional related procedures and the above “Tax Fees” were billed in connection with consultation services and agreed-upon procedures.
Non-Audit Services
The following table shows the amount of fees that PWC billed during the Fund’s last two fiscal years for non-audit services. For engagements entered into on or after May 6, 2003, the Audit Committee pre-approved all non-audit services that PWC provided to the Adviser and any Affiliated Fund Service Provider that related directly to the Fund’s operations and financial reporting. The Audit Committee requested and received information from PWC about any non-audit services that PWC rendered during the Fund’s last fiscal year to the Adviser and any Affiliated Fund Service Provider. The Committee considered this information in evaluating PWC’s independence.
Fiscal Year | Total (A) | Total Non-Audit Fees billed to Adviser and Affiliated Fund Service Providers (engagements related directly to the operations and financial reporting of the Fund) (B) | Total Non-Audit Fees billed to Adviser and Affiliated Fund Service Providers (all other engagements) (C) | Total of (A), (B) |
2005 | $0 | $197,605 | $104,635 | $302,240 |
2004 | $3,255 | $0 | $253,272 | $256,527 |
All other engagement fees were billed for services in connection with risk management, tax services and process improvement/integration initiatives for DeIM and other related entities that provide support for the operations of the fund.
TREASURY MONEY FUND INVESTMENT
FORM N-CSR DISCLOSURE RE: AUDIT FEES
The following table shows the amount of fees that PricewaterhouseCoopers, LLP (“PWC”), the Fund’s independent registered public accounting firm, billed to the Fund during the Fund’s last two fiscal years. The Audit Committee approved in advance all audit services and non-audit services that PWC provided to the Fund.
The Audit Committee has delegated certain pre-approval responsibilities to its Chairman (or, in his absence, any other member of the Audit Committee).
Services that the Fund’s Independent Registered Public Accounting Firm Billed to the Fund
Fiscal Year | Audit Fees Billed to Fund | Audit-Related | Tax Fees Billed to Fund | All |
2005 | $15,350 | $225 | $0 | $0 |
2004 | $14,300 | $185 | $3,255 | $0 |
The above “Audit- Related Fees” were billed for agreed upon procedures performed and the above "Tax Fees" were billed for professional services rendered for tax compliance and tax return preparation.
Services that the Fund’s Independent Registered Public Accounting Firm Billed to the Adviser and Affiliated Fund Service Providers
The following table shows the amount of fees billed by PWC to Deutsche Investment Management Americas, Inc. (“DeIM” or the “Adviser”), and any entity controlling, controlled by or under common control with DeIM (“Control Affiliate”) that provides ongoing services to the Fund (“Affiliated Fund Service Provider”), for engagements directly related to the Fund’s operations and financial reporting, during the Fund’s last two fiscal years.
Fiscal Year | Audit-Related | Tax Fees Billed to Adviser and Affiliated Fund Service Providers | All |
2005 | $268,900 | $197,605 | $0 |
2004 | $431,907 | $0 | $0 |
The “Audit-Related Fees” were billed for services in connection with the assessment of internal controls, agreed-upon procedures and additional related procedures and the above “Tax Fees” were billed in connection with consultation services and agreed-upon procedures.
Non-Audit Services
The following table shows the amount of fees that PWC billed during the Fund’s last two fiscal years for non-audit services. For engagements entered into on or after May 6, 2003, the Audit Committee pre-approved all non-audit services that PWC provided to the Adviser and any Affiliated Fund Service Provider that related directly to the Fund’s operations and financial reporting. The Audit Committee requested and received information from PWC about any non-audit services that PWC rendered during the Fund’s last fiscal year to the Adviser and any Affiliated Fund Service Provider. The Committee considered this information in evaluating PWC’s independence.
Fiscal Year | Total (A) | Total Non-Audit Fees billed to Adviser and Affiliated Fund Service Providers (engagements related directly to the operations and financial reporting of the Fund) (B) | Total Non-Audit Fees billed to Adviser and Affiliated Fund Service Providers (all other engagements) (C) | Total of (A), (B) |
2005 | $0 | $197,605 | $104,635 | $302,240 |
2004 | $3,255 | $0 | $253,272 | $256,527 |
All other engagement fees were billed for services in connection with risk management, tax services and process improvement/integration initiatives for DeIM and other related entities that provide support for the operations of the fund.
| ITEM 5. | AUDIT COMMITTEE OF LISTED REGISTRANTS |
| Not Applicable |
| ITEM 6. | SCHEDULE OF INVESTMENTS |
| Not Applicable |
ITEM 7. | DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES. |
| Not Applicable |
ITEM 8. | PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES. |
| Not applicable. |
ITEM 9. | PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS |
| Not Applicable. |
| ITEM 10. | SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. |
The Nominating and Governance Committee evaluates and nominates Board member candidates. Fund shareholders may also submit nominees that will be considered by the Committee when a Board vacancy occurs. Submissions should be mailed to the attention of the Secretary of the Fund, One South Street, Baltimore, MD 21202.
| ITEM 11. | CONTROLS AND PROCEDURES. |
(a) | The Chief Executive and Financial Officers concluded that the Registrant’s Disclosure Controls and Procedures are effective based on the evaluation of the Disclosure Controls and Procedures as of a date within 90 days of the filing date of this report. |
(b) | There have been no changes in the registrant’s internal control over financial reporting that occurred during the registrant’s last half-year (the registrant’s second fiscal half-year in the case of the annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal controls over financial reporting. |
| ITEM 12. | EXHIBITS. |
(a)(1) | Code of Ethics pursuant to Item 2 of Form N-CSR is filed and attached hereto as EX-99.CODE ETH. |
(a)(2) | Certification pursuant to Rule 30a-2(a) under the Investment Company Act of 1940 (17 CFR 270.30a-2(a)) is filed and attached hereto as Exhibit 99.CERT. |
(b) | Certification pursuant to Rule 30a-2(b) under the Investment Company Act of 1940 (17 CFR 270.30a-2(b)) is furnished and attached hereto as Exhibit 99.906CERT. |
Form N-CSR Item F
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Registrant: | Cash Management Fund Investment, a series of DWS Advisor Funds |
By: | /s/Vincent J. Esposito | |
| Vincent J. Esposito |
|
President
Date: | March 2, 2006 |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
Registrant: | Cash Management Fund Investment, a series of DWS Advisor Funds |
By: | /s/Vincent J. Esposito | |
| Vincent J. Esposito |
|
President
Date: | March 2, 2006 |
By: | /s/Paul Schubert | |
| Paul Schubert |
|
Chief Financial Officer and Treasurer
Date: | March 2, 2006 |
Form N-CSR Item F
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Registrant: | Treasury Money Fund Investment, a series of DWS Advisor Funds |
By: | /s/Vincent J. Esposito | |
| Vincent J. Esposito |
|
President
Date: | March 2, 2006 |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
Registrant: | Treasury Money Fund Investment, a series of DWS Advisor Funds |
By: | /s/Vincent J. Esposito | |
| Vincent J. Esposito |
|
President
Date: | March 2, 2006 |
By: | /s/Paul Schubert | |
| Paul Schubert |
|
Chief Financial Officer and Treasurer
Date: | March 2, 2006 |