WASHINGTON, D. C. 20549
We were able to maintain a competitive yield for the Tax-Exempt Portfolio during the period. (All performance is historical and does not guarantee future results. Yields fluctuate and are not guaranteed.)
The types of securities that we were investing in tended to have lower yields than issues carrying more risk. We preferred to be cautious during a time of market uncertainty. In the end, this cost the Portfolio some yield, but we believe that this represented a prudent approach to preserving principal.
Though money market yields have risen slightly in the first four months of 2010, we continue to foresee an artificially low interest rate environment in the near term because of declining money market supply and a large number of money market issues maturing with principal needing to be reinvested. The market is awaiting the removal of the "extended period" (of near-zero short-term rates) language from the Federal Open Market Committee's public statements for a clear signal that the Fed's rate policy is changing in response to an improving US economy.
Another factor that should influence yield levels going forward is the amendments to the money market rules (Rule 2a-7) by the Securities & Exchange Commission (SEC) being phased in from May through December 2010. The amendments cover a number of areas, including portfolio average maturity, liquidity requirements and portfolio operations. We believe that these regulations will tend to steepen the money market yield curve (i.e., steadily higher yields for longer maturities) as more funds maintain shorter average maturity in line with the amendments.
We continue our insistence on the highest credit quality within the Portfolio. We currently plan to maintain our conservative investment strategies and standards. We continue to apply a careful approach to investing and to seek competitive tax-exempt yield for our shareholders.
As an investor of the Portfolio, you incur two types of costs: ongoing expenses and transaction costs. Ongoing expenses include management fees, distribution and service (12b-1) fees and other Portfolio expenses. Examples of transaction costs include account maintenance fees, which are not shown in this section. The following tables are intended to help you understand your ongoing expenses (in dollars) of investing in the Portfolio and to help you compare these expenses with the ongoing expenses of investing in other mutual funds. In the most recent six-month period, the Portfolio limited these expenses; had it not done so, expenses would have been higher for the Tax-Exempt Cash Managed Shares. The example in the table is based on an investment of $1,000 invested at the beginning of the six-month period and held for the entire period (November 1, 2009 to April 30, 2010).
Please note that the expenses shown in these tables are meant to highlight your ongoing expenses only and do not reflect any transaction costs. The "Expenses Paid per $1,000" line of the tables is useful in comparing ongoing expenses only and will not help you determine the relative total expense of owning different funds. If these transaction costs had been included, your costs would have been higher.
For more information, please refer to the Portfolio's prospectus.
Following the Portfolio's fiscal first and third quarter-end, a complete portfolio holdings listing is filed with the SEC on Form N-Q. The form will be available on the SEC's Web site at www.sec.gov, and it also may be reviewed and copied at the SEC's Public Reference Room in Washington, D.C. Information on the operation of the SEC's Public Reference Room may be obtained by calling (800) SEC-0330. A complete list of the Portfolio's holdings is also posted on www.dws-investments.com from time to time. Please see the Portfolio's current prospectus for more information.
| Principal Amount ($) | Value ($) |
| |
Municipal Investments 99.5% |
Alabama 0.5% |
Pell City, AL, Special Care Facilities Financing Authority Revenue, Noland Health Services, Series A, 0.3%*, 12/1/2039, US Bank NA (a) | 4,000,000 | 4,000,000 |
Tuscaloosa County, AL, Industrial Development Gulf Opportunity Zone, Hunt Refining Project, Series C, 0.4%*, 12/1/2027, JPMorgan Chase Bank (a) | 10,000,000 | 10,000,000 |
| 14,000,000 |
Arizona 1.8% |
Arizona, Board of Regents, State University Systems Revenue, Series A, 0.25%*, 7/1/2034, Lloyds TSB Bank PLC (a) | 1,200,000 | 1,200,000 |
Arizona, Health Facilities Authority Revenue, Catholic West, Series A, 0.27%*, 7/1/2035, JPMorgan Chase Bank (a) | 7,600,000 | 7,600,000 |
Arizona, Salt River Pima-Maricopa Indian Community, 0.33%*, 10/1/2026, Bank of America NA (a) | 3,275,000 | 3,275,000 |
Phoenix, AZ, Civic Improvement Corp., 0.28%, 6/3/2010 | 42,000,000 | 42,000,000 |
| 54,075,000 |
California 4.1% |
California, Clipper Tax-Exempt Certificate Trust, Series 2009-66, 144A, 0.33%*, 5/15/2030 | 15,000,000 | 15,000,000 |
California, State Kindergarten, Series A6, 0.26%*, 5/1/2034, Citibank NA and California State Teachers Retirement System (a) | 1,900,000 | 1,900,000 |
California, Statewide Communities Development Authority, Multi-Family Housing Revenue: | |
| Series 2680, 144A, 0.4%*, 5/15/2016, JPMorgan Chase Bank (a) | 15,000,000 | 15,000,000 |
| Series 2681, 144A, AMT, 0.55%*, 5/15/2018, JPMorgan Chase Bank (a) | 10,000,000 | 10,000,000 |
California, Wells Fargo Stage Trust, Series 72C, 144A, 0.35%*, 8/15/2039 | 28,275,000 | 28,275,000 |
San Francisco, CA, City & County Airports Commission, International Airport Revenue, Series A-1, AMT, 0.31%*, 5/1/2030, JPMorgan Chase Bank (a) | 10,000,000 | 10,000,000 |
Tustin, CA, Unified School District, Series 2007-336, 144A, 0.42%*, 9/1/2011, Bank of America NA (a) | 44,760,000 | 44,760,000 |
| 124,935,000 |
Colorado 2.5% |
Colorado, Centerra Metropolitan District 1 Revenue, Refunding and Improvement, 0.65%*, 12/1/2029, Compass Bank (a) | 14,945,000 | 14,945,000 |
Colorado, Educational & Cultural Facilities Authority Revenue, Fremont Christian School Project, 0.3%*, 6/1/2038, US Bank NA (a) | 9,000,000 | 9,000,000 |
Colorado, Educational & Cultural Facilities Authority Revenue, National Jewish Federal Bond Program, Series A-6, 0.27%*, 2/1/2025, Bank of America NA (a) | 4,595,000 | 4,595,000 |
Colorado, Goldsmith Metropolitan District, 0.72%*, 12/1/2034, Compass Bank (a) | 5,270,000 | 5,270,000 |
Colorado, Health Facilities Authority Revenue, Bethesda Adult Communities, Series A, 0.3%*, 8/15/2034, LaSalle Bank NA (a) | 8,740,000 | 8,740,000 |
Colorado, Housing & Finance Authority Revenue, Single Family, Series C-3, "I", AMT, 0.4%*, 5/1/2022 | 4,000,000 | 4,000,000 |
Colorado, Lowry Economic Redevelopment Authority Revenue, Series A, 0.65%*, 12/1/2020, Compass Bank (a) | 6,405,000 | 6,405,000 |
Colorado, Meridian Village Metropolitan, RBC Municipal Products, Inc. Trust, Series C-11, 144A, 0.3%*, 12/1/2031, Royal Bank of Canada (a) | 16,500,000 | 16,500,000 |
Denver, CO, 0.3%, 6/9/2010 | 8,500,000 | 8,500,000 |
| 77,955,000 |
Connecticut 0.4% |
Newtown, CT, Bond Anticipation Notes, 1.75%, 2/23/2011 | 11,900,000 | 12,039,412 |
Delaware 0.5% |
Delaware, BB&T Municipal Trust, Series 5000, 144A, 0.45%*, 10/1/2028, Rabobank International (a) | 14,740,054 | 14,740,054 |
District of Columbia 0.4% |
District of Columbia, Center for Internships & Academic Revenue, 0.3%*, 7/1/2036, Branch Banking & Trust (a) | 3,400,000 | 3,400,000 |
District of Columbia, Housing Finance Agency, Multi-Family Housing Revenue, Series R-433, 144A, AMT, 0.37%*, 12/1/2021 | 7,780,000 | 7,780,000 |
| 11,180,000 |
Florida 5.9% |
Alachua County, FL, Housing Finance Authority, Multi-Family Revenue, Santa Fe I Apartments, AMT, 0.35%*, 12/15/2038, Citibank NA (a) | 3,850,000 | 3,850,000 |
Broward County, FL, Housing Finance Authority, Multi-Family Housing Revenue, Palms of Deerfield Beach, AMT, 0.35%*, 8/15/2038, Citibank NA (a) | 1,950,000 | 1,950,000 |
Florida, BB&T Municipal Trust: |
| Series 1010, 144A, 0.37%*, 1/15/2019, Branch Banking & Trust (a) | 7,040,000 | 7,040,000 |
| Series 1029, 0.37%*, 7/1/2024, Branch Banking & Trust (a) | 10,830,000 | 10,830,000 |
| Series 1012, 144A, 0.37%*, 11/1/2024, Branch Banking & Trust (a) | 9,870,000 | 9,870,000 |
Florida, Capital Trust Agency Housing Revenue, Atlantic Housing Foundation, Series A, 0.31%*, 7/15/2024 | 19,000,000 | 19,000,000 |
Florida, Development Finance Corp., Enterprise Board Program, Out of Door Academy, 0.31%*, 7/1/2038, Northern Trust Co. (a) | 13,500,000 | 13,500,000 |
Florida, Gulf Coast University Financing Corp., Capital Improvement Revenue, Housing Project, Series A, 0.28%*, 2/1/2038, Wells Fargo Bank NA (a) | 5,600,000 | 5,600,000 |
Florida, Housing Finance Corp., Multi-Family Revenue, Victoria Park, Series J-1, 0.3%*, 10/15/2032 | 8,920,000 | 8,920,000 |
Florida, Sunshine State Governmental Financing Commission Revenue, 0.41%*, 7/1/2016, Dexia Credit Local (a) | 23,755,000 | 23,755,000 |
Highlands County, FL, Health Facilities Authority Revenue, Adventist Health Hospital, Series G, 0.3%*, 11/15/2035, Branch Banking & Trust (a) | 8,000,000 | 8,000,000 |
Hillsborough County, FL, School Board, Certificates of Participation, Master Lease Program, Series A, 0.29%*, 7/1/2023, Wells Fargo Bank NA (a) (b) | 13,200,000 | 13,200,000 |
Lee County, FL, Industrial Development Authority, Health Care Facilities Revenue, Hope Hospice Project, 0.31%*, 10/1/2027, Northern Trust Co. (a) | 17,000,000 | 17,000,000 |
Orange County, FL, Health Facilities Authority Revenue, Adventist Health Sunbelt, 0.3%*, 11/15/2026, Wells Fargo Bank NA (a) | 8,550,000 | 8,550,000 |
Palm Beach County, FL, Community Foundation, Palm Beach Project Revenue, 0.36%*, 3/1/2034, Northern Trust Co. (a) | 4,750,000 | 4,750,000 |
Pinellas County, FL, Educational Facilities Authority Revenue, Barry University Project, 0.33%*, 10/1/2037, Bank of America NA (a) | 9,340,000 | 9,340,000 |
Sarasota County, FL, Health Care Facilities Authority Revenue, Bay Village Project, 0.35%*, 12/1/2023, Bank of America NA (a) | 2,500,000 | 2,500,000 |
Sarasota County, FL, Public Hospital District Revenue, Sarasota Memorial Hospital, Series B, 0.31%*, 7/1/2037, Bank of America NA (a) | 7,500,000 | 7,500,000 |
Volusia County, FL, Housing Finance Authority, Multi-Family Housing Revenue, Cape Morris Cove Apartments, Series A, AMT, 0.34%*, 10/15/2042, JPMorgan Chase Bank (a) | 6,140,000 | 6,140,000 |
| 181,295,000 |
Georgia 1.5% |
Atlanta, GA, Revenue Bond, Series 2008-3046X, 144A, 0.3%*, 7/1/2037 (b) | 6,665,000 | 6,665,000 |
Fulton County, GA, Development Authority Revenue, Mount Vernon Presbyterian School, 0.3%*, 8/1/2035, Branch Banking & Trust (a) | 2,700,000 | 2,700,000 |
Georgia, Municipal Electric Authority Power Revenue, Municipal Securities Trust Receipts, Series SGC-60, "A", 144A, 0.3%*, 1/1/2018 (b) | 4,660,000 | 4,660,000 |
Georgia, Private Colleges & Universities Authority Revenue, Mercer University Project: | |
| Series C, 0.3%*, 10/1/2031, Branch Banking & Trust (a) | 8,695,000 | 8,695,000 |
| Series A, 0.3%*, 10/1/2036, Branch Banking & Trust (a) | 11,040,000 | 11,040,000 |
Georgia, State General Obligation, Series H-3, 0.3%*, 12/1/2026 | 9,094,000 | 9,094,000 |
Heard County, GA, Development Authority Pollution Control Revenue, Oglethorpe Power Corp., Hal B. Wansley Power Plant, Series A, 0.26%*, 1/1/2038, JPMorgan Chase Bank (a) | 3,700,000 | 3,700,000 |
| 46,554,000 |
Idaho 1.9% |
Idaho, Housing & Finance Association, Single Family Mortgage: | |
| Series B, AMT, 0.4%*, 7/1/2032 | 5,460,000 | 5,460,000 |
| "I", Series A, AMT, 0.4%*, 7/1/2033 | 6,280,000 | 6,280,000 |
| "I", Series B, AMT, 0.4%*, 7/1/2033 | 6,160,000 | 6,160,000 |
Idaho, Non-Profit Housing & Finance Association Facilities Revenue, College of Idaho Project, 0.29%*, 7/1/2030, US Bank NA (a) | 4,950,000 | 4,950,000 |
Idaho, State Tax Anticipation Notes, 2.5%, 6/30/2010 | 35,000,000 | 35,120,288 |
| 57,970,288 |
Illinois 10.8% |
Channahon, IL, Morris Hospital Revenue, Series B, 0.26%*, 12/1/2032, US Bank NA (a) | 1,195,000 | 1,195,000 |
Chicago, IL, Board of Education, Dedicated Revenues: |
| Series A-1, 0.31%*, 3/1/2026, Harris NA (a) | 5,400,000 | 5,400,000 |
| Series A-2, 0.31%*, 3/1/2026, Northern Trust Co. (a) | 5,900,000 | 5,900,000 |
Chicago, IL, General Obligation, Series 2008-068, 144A, 0.45%*, 1/1/2022, Dexia Credit Local (a) (b) | 11,525,000 | 11,525,000 |
Chicago, IL, Metropolitan Water Reclamation District, Greater Chicago: | |
| Series 2008-051, 144A, 0.45%*, 12/1/2028 | 5,375,000 | 5,375,000 |
| Series 2008-052, 144A, 0.45%*, 12/1/2035 | 25,145,000 | 25,145,000 |
Cook County, IL, Catholic Theological Union Project Revenue, 0.36%*, 2/1/2035, Harris NA (a) | 6,000,000 | 6,000,000 |
Illinois, BB&T Municipal Trust, Series 5001, 144A, 0.45%*, 6/1/2020, Rabobank International (a) | 18,749,484 | 18,749,484 |
Illinois, Development Finance Authority Revenue, Shelby Memorial Hospital Association, Inc., Series B-1, 0.37%*, 10/1/2029, Comerica Bank (a) | 6,000,000 | 6,000,000 |
Illinois, Educational Facilities Authority Revenues: |
| 0.28%, 6/10/2010 | 30,000,000 | 30,000,000 |
| 0.32%, 8/9/2010 | 20,200,000 | 20,200,000 |
Illinois, Educational Facilities Authority Revenues, University of Chicago: | |
| Series B-1, 0.52%*, Mandatroy Put 8/12/2010 @ 100, 7/1/2036 | 9,500,000 | 9,499,319 |
| Series B-2, 0.52%*, Mandatroy Put 8/26/2010 @ 100, 7/1/2036 | 8,600,000 | 8,600,000 |
Illinois, Finance Authority Industrial Development Revenue, Fitzpatrick Brothers, 0.31%*, 4/1/2033, Northern Trust Co. (a) | 5,000,000 | 5,000,000 |
Illinois, Finance Authority Pollution Control Revenue, Commonwealth Edison Co., Series E, 144A, 0.32%*, 5/1/2021, JPMorgan Chase Bank (a) | 8,305,000 | 8,305,000 |
Illinois, Finance Authority Revenue, "A", 144A, 0.3%*, 12/1/2042 | 5,445,000 | 5,445,000 |
Illinois, Finance Authority Revenue, Carle Foundation, Series C, 0.27%*, 2/15/2033, Northern Trust Co. (a) | 1,800,000 | 1,800,000 |
Illinois, Finance Authority Revenue, Northwestern University: |
| Series B, 0.32%*, Mandatroy Put 3/1/2011 @ 100, 12/1/2046 | 15,000,000 | 15,000,000 |
| Series C, 0.32%*, Mandatroy Put 3/1/2011 @ 100, 12/1/2046 | 10,000,000 | 10,000,000 |
| Series A, 0.4%*, Mandatroy Put 3/1/2011 @ 100, 12/1/2034 | 30,000,000 | 30,000,000 |
| 0.4%*, Mandatroy Put 3/1/2011 @ 100, 12/1/2046 | 20,000,000 | 20,000,000 |
Illinois, Finance Authority Revenue, Rehabilitation Institute of Chicago, Series C, 0.27%*, 4/1/2039, Northern Trust Co. (a) | 2,175,000 | 2,175,000 |
Illinois, Finance Authority Revenue, The Art Institution of Chicago: | |
| Series B-1, 0.3%*, 9/1/2038, JPMorgan Chase Bank (a) | 4,430,000 | 4,430,000 |
| Series B-2, 0.3%*, 9/1/2038, Northern Trust Co. (a) | 2,085,000 | 2,085,000 |
Illinois, Finance Authority Student Housing Revenue, CHF-Dekalb LLC Project, Series A, 0.35%*, 7/1/2038, Sovereign Bank FSB (a) | 9,000,000 | 9,000,000 |
Illinois, Regional Transit Improvements, Series 2008-3043X, 144A, 0.33%*, 7/1/2026 (b) | 6,665,000 | 6,665,000 |
Illinois, University of Illinois Revenue, "A", 144A, 0.31%*, 4/1/2035 (b) | 14,300,000 | 14,300,000 |
Illinois, Wells Fargo Stage Trust, Series 50C, 144A, 0.3%*, 11/15/2035 | 9,110,000 | 9,110,000 |
Mundelein, IL, Industrial Development Revenue, MacLean Fogg Co. Project, AMT, 0.61%*, 1/1/2015, Northern Trust Co. (a) | 6,500,000 | 6,500,000 |
Woodstock, IL, Multi-Family Housing Revenue, Willow Brooke Apartments, AMT, 0.35%*, 4/1/2042, Wells Fargo Bank NA (a) | 28,000,000 | 28,000,000 |
| 331,403,803 |
Indiana 0.4% |
Indiana, Finance Authority Hospital Revenue, Community Foundation of Northwest Indiana, 0.29%*, 8/1/2029, Harris NA (a) | 6,970,000 | 6,970,000 |
Indiana, State Development Finance Authority, Industrial Development Revenue, Enterprise Center VI Project, AMT, 0.43%*, 6/1/2022, LaSalle Bank NA (a) | 800,000 | 800,000 |
Indiana, State Development Finance Authority, Industrial Development Revenue, Republic Services, Inc., 0.25%*, 11/1/2035, JPMorgan Chase Bank (a) | 5,000,000 | 5,000,000 |
| 12,770,000 |
Iowa 1.3% |
Iowa, Finance Authority Revenue, Senior Revenue Anticipation Notes, Series A, 2.5%, 6/23/2010 | 36,000,000 | 36,101,340 |
Iowa, Finance Authority, Private College Revenue, Central College Project, 0.29%*, 10/1/2038, Wells Fargo Bank NA (a) | 3,000,000 | 3,000,000 |
| 39,101,340 |
Kansas 0.5% |
Kansas, State Development Finance Authority, Multi-Family Revenue, Oak Ridge Park II Project, Series X, AMT, 0.4%*, 12/1/2036, US Bank NA (a) | 3,650,000 | 3,650,000 |
Lenexa, KS, Revenue Bond, Series 2007-302, 144A, 0.32%*, 2/1/2012 | 12,045,000 | 12,045,000 |
| 15,695,000 |
Kentucky 0.1% |
Mason County, KY, Pollution Control Revenue, East Kentucky Power Corp., Inc., Series B-2, 1.1%*, 10/15/2014 | 4,000,000 | 4,000,000 |
Louisiana 0.5% |
Louisiana, Public Facilities Authority Revenue, C-Port LLC Project, 0.33%*, 10/1/2028, Bank of America NA (a) | 5,500,000 | 5,500,000 |
Louisiana, State Gas & Fuels Tax Revenue, Series A-1, 0.28%*, 5/1/2043, JPMorgan Chase Bank (a) | 9,000,000 | 9,000,000 |
| 14,500,000 |
Maine 0.6% |
Maine, State Housing Authority Mortgage Purchase: |
| Series B, AMT, 0.3%*, 11/15/2041 | 15,000,000 | 15,000,000 |
| Series E-1, 0.4%*, 11/15/2032 | 3,000,000 | 3,000,000 |
| 18,000,000 |
Maryland 1.6% |
Baltimore, MD, Municipal Securities Trust Receipts, SGA 152, "A", 144A, 0.33%*, 7/1/2020, Societe Generale (a) (b) | 10,000,000 | 10,000,000 |
Maryland, BB&T Municipal Trust, Series 46, 144A, 0.31%*, 7/1/2016 | 3,845,000 | 3,845,000 |
Maryland, Health & Higher Education Facility, Series A, 0.25%, 5/17/2010 | 25,000,000 | 25,000,000 |
Maryland, State Health & Higher Educational Facilities Authority Revenue, Upper Chesapeake Hospital, Series B, 0.31%*, 1/1/2043, Branch Banking & Trust (a) | 11,800,000 | 11,800,000 |
| 50,645,000 |
Massachusetts 2.3% |
Massachusetts, Health & Education University Revenue, 0.22%, 5/27/2010 | 10,000,000 | 10,000,000 |
Massachusetts, Macon Trust, Series 2007-310, 144A, 0.32%*, 6/15/2012, Bank of America NA (a) | 7,335,000 | 7,335,000 |
Massachusetts, State Development Finance Agency Revenue, New Bedford Waste Services LLC, AMT, 0.37%*, 6/1/2021, Comerica Bank (a) | 3,520,000 | 3,520,000 |
Massachusetts, State Development Finance Agency Revenue, YMCA of Greater Worcester, 0.3%*, 9/1/2041, TD Bank NA (a) | 7,180,000 | 7,180,000 |
Massachusetts, State General Obligation, Series B, 0.3%*, 3/1/2026 | 5,000,000 | 5,000,000 |
Massachusetts, State Industrial Finance Agency Revenue, Groton School Issue, Series B, 0.3%*, 3/1/2028 | 8,095,000 | 8,095,000 |
Massachusetts, State Industrial Finance Agency Revenue, JHC Assisted Living Corp., Series A, 144A, 0.31%*, 12/1/2029, TD Bank NA (a) | 4,875,000 | 4,875,000 |
Massachusetts, State Revenue Anticipation Notes, Series B, 144A, 2.5%, 5/27/2010 | 25,000,000 | 25,039,813 |
| 71,044,813 |
Michigan 2.9% |
Michigan, RBC Municipal Products, Inc. Trust, Series L-25, 144A, AMT, 0.33%*, 9/1/2033, Royal Bank of Canada (a) | 66,745,000 | 66,745,000 |
Michigan, State Hospital Finance Authority Revenue, Ascension Health Senior Credit Group: | |
| Series F-7, 0.39%*, 11/15/2047 | 11,200,000 | 11,200,000 |
| Series F-6, 0.39%*, 11/15/2049 | 10,000,000 | 10,000,000 |
| 87,945,000 |
Minnesota 1.7% |
Coon Rapids, MN, Industrial Development Revenue, Kurt Manufacturing Project: | |
| AMT, 0.35%*, 11/1/2027, US Bank NA (a) | 5,000,000 | 5,000,000 |
| AMT, 0.5%*, 11/1/2017, US Bank NA (a) | 2,315,000 | 2,315,000 |
Minnesota, Barclays Capital Municipal Trust Receipts, Series 6W, 144A, AMT, 0.36%*, 1/1/2038 | 3,420,000 | 3,420,000 |
Minnesota, Regents of the University of Minnesota, 0.27%, 5/24/2010 | 6,387,000 | 6,387,000 |
Minnesota, State General Obligation, Prerefunded 6/1/2010 @ 100, 5.625%, 6/1/2019 | 3,000,000 | 3,013,030 |
Minnesota, State Housing Finance Agency, Residential Housing: | |
| Series J, AMT, 0.32%*, 7/1/2033 | 7,500,000 | 7,500,000 |
| Series C, AMT, 0.32%*, 1/1/2037 | 18,950,000 | 18,950,000 |
| Series C, AMT, 0.32%*, 7/1/2048 | 5,000,000 | 5,000,000 |
| 51,585,030 |
Mississippi 0.6% |
Mississippi, Redstone Partners Floaters/Residuals Trust: |
| Series A, 144A, AMT, 0.47%*, 12/1/2047, Wachovia Bank NA (a) | 7,995,000 | 7,995,000 |
| Series C, 144A, AMT, 0.47%*, 12/1/2047, Wachovia Bank NA (a) | 9,375,000 | 9,375,000 |
| 17,370,000 |
Missouri 1.0% |
Missouri, Bi-State Development Agency, Illinois Metropolitan District Revenue, Metrolink, Series A, 0.31%*, 10/1/2035, JPMorgan Chase Bank (a) | 8,000,000 | 8,000,000 |
Missouri, State Health & Educational Facilities Authority Revenue, Lutheran Senior Services Project, 0.29%*, 2/1/2039, US Bank NA (a) | 9,000,000 | 9,000,000 |
Platte County, MO, Industrial Development Authority Revenue, Complete Home Concepts, Series A, AMT, 0.35%*, 1/1/2039, Columbian Bank (a) | 6,800,000 | 6,800,000 |
St Louis, MO, Airport Revenue, Series 004, 144A, 0.34%*, 7/1/2026, Dexia Credit Local (a) (b) | 7,990,000 | 7,990,000 |
| 31,790,000 |
Nebraska 0.1% |
Omaha, NE, Public Power District Electric Revenue, Series R-11291, 144A, 0.31%*, 8/1/2012 | 2,480,000 | 2,480,000 |
Nevada 2.1% |
Clark County, NV, General Obligation, Series 3489Z, 144A, 0.3%*, 1/1/2017 | 11,965,000 | 11,965,000 |
Clark County, NV, School District Building, Series A, 5.0%, 6/15/2010 | 20,800,000 | 20,909,961 |
Nevada, Housing Division, Multi-Unit Housing, Apache Project, Series A, AMT, 0.3%*, 10/15/2032 | 4,400,000 | 4,400,000 |
Nevada, Housing Division, Single Family Mortgage Revenue: |
| Series A, AMT, 0.45%*, 10/1/2039 | 14,700,000 | 14,700,000 |
| Series B, AMT, 0.45%*, 4/1/2042 | 8,000,000 | 8,000,000 |
Nevada, State Director Department of Business & Industry, Nevada Cancer Institute Project, 0.33%*, 12/1/2033, Bank of America NA (a) | 4,000,000 | 4,000,000 |
| 63,974,961 |
New Jersey 0.1% |
New Jersey, Economic Development Authority, Industrial Development Revenue, CST-Products LLC Project, AMT, 0.44%*, 4/1/2026, National Bank of Canada (a) | 2,720,000 | 2,720,000 |
New Mexico 0.6% |
New Mexico, Educational Assistance Foundation: |
| Series A-1, AMT, 0.33%*, 4/1/2034, Royal Bank of Canada (a) | 10,000,000 | 10,000,000 |
| Series A-2, AMT, 0.33%*, 4/1/2034, Royal Bank of Canada (a) | 10,000,000 | 10,000,000 |
| 20,000,000 |
New York 7.1% |
Albany, NY, Industrial Development Agency, Civic Facility Revenue, Albany College of Pharmacy, Series A, 0.29%*, 7/1/2038, TD Bank NA (a) | 2,230,000 | 2,230,000 |
Albany, NY, Industrial Development Agency, Civic Facility Revenue, The College of St. Rose, Series A, 0.26%*, 7/1/2037, Bank of America NA (a) (b) | 1,700,000 | 1,700,000 |
Hempstead, NY, Industrial Development Agency Revenue, Series 92G, 144A, AMT, 0.31%*, 10/1/2045 | 22,300,000 | 22,300,000 |
Nassau County, NY, Interim Finance Authority Revenue, Series D-2, 0.31%*, 11/15/2015 | 5,000,000 | 5,000,000 |
New York, Liberty Development Corp. Revenue, World Trade Center Project, Series A, 0.5%*, Mandatroy Put 1/18/2011 @ 100, 12/1/2049 | 25,000,000 | 25,003,352 |
New York, State Dormitory Authority Revenues, State Supported Debt, City University of New York, Series C, 0.31%*, 7/1/2031, Bank of America NA (a) | 3,300,000 | 3,300,000 |
New York, State Dormitory Authority, State Personal Income Tax Revenue, Series A, 3.0%, 2/15/2011 | 4,240,000 | 4,329,425 |
New York, State Housing Finance Agency Revenue, Capitol Green Apartments, Series A, AMT, 0.33%*, 5/15/2036 | 2,800,000 | 2,800,000 |
New York, State Housing Finance Agency Revenue, Helena Housing:, Series A, AMT, 0.32%*, 5/15/2036 | 9,450,000 | 9,450,000 |
New York, State Mortgage Agency, Homeowner Mortgage Revenue: | |
| Series 142, AMT, 0.28%*, 10/1/2037 | 5,800,000 | 5,800,000 |
| Series 144, AMT, 0.3%*, 10/1/2037 | 8,000,000 | 8,000,000 |
| Series 157, 0.3%*, 4/1/2047 | 10,000,000 | 10,000,000 |
New York, State Urban Development Corp. Revenue, Barclays Capital Municipal Trust Receipts, Series 6W-D, 144A, 0.27%*, 3/15/2037 | 2,600,000 | 2,600,000 |
New York, Triborough Bridge & Tunnel Authority Revenues, Series B-4, 0.31%*, 1/1/2032 | 4,000,000 | 4,000,000 |
New York City, NY, Municipal Water Finance Authority, Water & Sewer Systems Revenue, Second Generation Resolution, Series AA-3, 0.33%*, 6/15/2032 | 11,850,000 | 11,850,000 |
Oyster Bay, NY, Bond Anticipation Notes, 1.5%, 3/11/2011 | 35,000,000 | 35,360,111 |
Port Authority of New York & New Jersey: 144A, 0.33%, 7/7/2010 | 10,000,000 | 10,000,000 |
Series 162, 0.35%, 9/15/2010 | 10,000,000 | 10,000,000 |
Suffolk County, NY, Tax Anticipation Notes, 2.0%, 8/12/2010 | 45,000,000 | 45,210,465 |
| 218,933,353 |
North Carolina 5.6% |
Cleveland County, NC, Industrial Facilities & Pollution Control Financing Authority, Curtiss-Wright Flight Systems, AMT, 0.35%*, 11/1/2023, Bank of America NA (a) | 8,400,000 | 8,400,000 |
North Carolina, BB&T Municipal Trust: |
| Series 1027, 144A, 0.37%*, 3/1/2016, Branch Banking & Trust (a) | 11,085,000 | 11,085,000 |
| Series 1032, 0.37%*, 1/7/2024, Branch Banking & Trust (a) | 12,310,000 | 12,310,000 |
| Series 1008, 144A, 0.37%*, 3/1/2024, Branch Banking & Trust (a) | 6,065,000 | 6,065,000 |
| Series 1011, 144A, 0.37%*, 4/1/2024, Branch Banking & Trust (a) | 7,945,000 | 7,945,000 |
| Series 1024, 144A, 0.37%*, 5/31/2024, Branch Banking & Trust (a) | 5,105,000 | 5,105,000 |
| Series 1009, 144A, 0.37%*, 6/1/2024, Branch Banking & Trust (a) | 17,795,000 | 17,795,000 |
| Series 1025, 144A, 0.37%*, 6/1/2024, Branch Banking & Trust (a) | 11,300,000 | 11,300,000 |
North Carolina, Capital Educational Facilities Finance Agency Revenue, High Point University Project: | |
| 0.3%*, 12/1/2028, Branch Banking & Trust (a) | 5,700,000 | 5,700,000 |
| 0.3%*, 5/1/2030, Branch Banking & Trust (a) | 4,500,000 | 4,500,000 |
North Carolina, Capital Facilities Finance Agency, Educational Facilities Revenue, Salem Academy & College Project, 0.3%*, 8/1/2030, Branch Banking & Trust (a) | 7,170,000 | 7,170,000 |
North Carolina, Capital Facilities Finance Agency, Educational Facilities Revenue, Campbell University, 0.3%*, 10/1/2034, Branch Banking & Trust (a) | 5,925,000 | 5,925,000 |
North Carolina, Capital Facilities Finance Agency, Exempt Facilities Revenue, Republic Services, Inc., 0.31%*, 7/1/2034, Bank of America NA (a) | 5,000,000 | 5,000,000 |
North Carolina, Charlotte-Mecklenburg Hospital Authority, Carolinas Health Care Systems Revenue: | |
| Series B, 0.27%*, 1/15/2026 | 5,000,000 | 5,000,000 |
| Series H, 0.27%*, 1/15/2045, Wells Fargo Bank NA (a) | 15,000,000 | 15,000,000 |
North Carolina, Medical Care Commission, Health Care Facilities Revenue, First Mortgage Deerfield, Series B, 0.3%*, 11/1/2038, Branch Banking & Trust (a) | 10,035,000 | 10,035,000 |
North Carolina, Piedmont Triad Airport Authority Revenue: |
| Series A, 0.33%*, 7/1/2032, Branch Banking & Trust (a) | 3,450,000 | 3,450,000 |
| Series B, AMT, 0.35%*, 7/1/2029, Branch Banking & Trust (a) | 3,845,000 | 3,845,000 |
North Carolina, State Education Assistance Authority Revenue, Student Loan: | |
| Series A-2, AMT, 0.33%*, 9/1/2035, Royal Bank of Canada (a) | 9,000,000 | 9,000,000 |
| Series 5, AMT, 0.35%*, 9/1/2035, Branch Banking & Trust (a) | 15,990,000 | 15,990,000 |
University of North Carolina Revenues, Series R-11292, 144A, 0.31%*, 12/1/2015 | 3,070,000 | 3,070,000 |
| 173,690,000 |
Ohio 1.6% |
Akron, Bath & Copley, OH, Joint Township Hospital District Revenue, Health Care Facility, Summner Project, 0.33%*, 12/1/2032, KBC Bank NV (a) | 5,050,000 | 5,050,000 |
Ohio, Cleveland Clinic Health System, 0.27%, 7/8/2010 | 15,000,000 | 15,000,000 |
Columbus, OH, Regional Airport Authority Revenue, Pooled Financing Program, Series A, 0.3%*, 1/1/2030, US Bank NA (a) | 4,020,000 | 4,020,000 |
Ohio, Clipper Tax-Exempt Certificate Trust, Certificate of Participation, Series 2009-28, 144A, AMT, 0.42%*, 3/1/2035 | 4,052,000 | 4,052,000 |
Ohio, Redstone Partners Floaters/Residuals Trust, Housing Finance Authority: | |
| Series C, 144A, 0.47%*, 6/1/2048, Wachovia Bank NA (a) | 9,780,000 | 9,780,000 |
| Series D, 144A, AMT, 0.47%*, 6/1/2048, Wachovia Bank NA (a) | 4,340,000 | 4,340,000 |
Ohio, State Housing Finance Authority Revenue, Series 2008-3308, 144A, AMT, 0.37%*, 3/1/2033 | 8,392,000 | 8,392,000 |
| 50,634,000 |
Oklahoma 0.5% |
Oklahoma, Development Finance Authority, Continuing Care Retirement, Inverness Village Project, Series A, 0.32%*, 1/1/2042, KBC Bank NV (a) | 15,670,000 | 15,670,000 |
Oregon 0.7% |
Oregon, State Veterans Welfare: |
| Series 85, 0.25%*, 6/1/2041 | 5,775,000 | 5,775,000 |
| Series B, 0.27%*, 12/1/2045 | 2,700,000 | 2,700,000 |
Salem, OR, Hospital Facility Authority Revenue, Capital Manor, Inc. Project: | |
| 0.33%*, 5/1/2034, Bank of America NA (a) | 8,680,000 | 8,680,000 |
| 0.33%*, 5/1/2037, Bank of America NA (a) | 5,415,000 | 5,415,000 |
| 22,570,000 |
Pennsylvania 4.7% |
Adams County, PA, Industrial Development Authority Revenue, Brethren Home Community Project, 0.34%*, 6/1/2032, PNC Bank NA (a) | 7,525,000 | 7,525,000 |
Allegheny County, PA, RBC Municipal Products, Inc. Trust Certificates, Series E-16, 144A, 0.3%*, 4/15/2039, Royal Bank of Canada (a) | 10,000,000 | 10,000,000 |
Butler County, PA, General Authority Revenue, New Castle Area School District, Series A, 0.29%*, 3/1/2029, PNC Bank NA (a) | 3,035,000 | 3,035,000 |
Cumberland County, PA, Municipal Authority Revenue, Asbury Pennsylvania Obligation Group, 0.3%*, 1/1/2043, KBC Bank NV (a) | 3,855,000 | 3,855,000 |
Monroe County, PA, Hospital Authority Revenue, Stars-Pocono Medical Center, Series B, 0.3%*, 1/1/2032, PNC Bank NA (a) (b) | 10,310,000 | 10,310,000 |
Pennsylvania, BB&T Municipal Trust, Series 1, 0.31%*, 9/15/2015 | 8,530,000 | 8,530,000 |
Pennsylvania, Economic Development Financing Authority, 144A, 0.45%, 9/1/2010 | 10,000,000 | 10,000,000 |
Pennsylvania, RBC Municipal Products, Inc. Trust Certificates, Bethlehem Area School, Series E-12, 144A, 0.31%*, 1/5/2012, Royal Bank of Canada (a) | 5,000,000 | 5,000,000 |
Pennsylvania, State Tax Anticipation Notes, 1.5%, 6/30/2010 | 50,000,000 | 50,098,842 |
Pennsylvania, University of Pittsburgh, Commonwealth Systems of Higher Education, Panthers-Pitt Asset Notes, 144A, 5.0%, 8/1/2010 | 25,475,000 | 25,764,075 |
Philadelphia, PA, Redstone Partners Floaters/Residuals Trust, Series B, 144A, AMT, 0.47%*, 4/1/2048, Wachovia Bank NA (a) | 8,970,000 | 8,970,000 |
| 143,087,917 |
South Carolina 1.1% |
Greenwood County, SC, Exempt Facility Industrial Revenue, Fuji Photo Film Project, AMT, 0.38%*, 9/1/2011 | 10,300,000 | 10,300,000 |
South Carolina, BB&T Municipal Trust, Series 1013, 144A, 0.37%*, 1/1/2020, Branch Banking & Trust (a) | 6,065,000 | 6,065,000 |
South Carolina, Jobs Economic Development Authority Revenue, Community YMCA of Rock Hill Project, 0.33%*, 11/1/2024, Bank of America NA (a) | 2,900,000 | 2,900,000 |
South Carolina, Jobs Economic Development Authority Revenue, Goodwill Industries of Upper South Carolina, Inc. Project, 0.3%*, 9/1/2028, Branch Banking & Trust (a) | 6,175,000 | 6,175,000 |
South Carolina, Jobs Economic Development Authority, Hospital Revenue, CareAlliance Health, Series B, 0.29%*, 8/15/2037, Wells Fargo Bank NA (a) (b) | 9,900,000 | 9,900,000 |
| 35,340,000 |
South Dakota 1.3% |
South Dakota, Conservancy District Revenue, State Revolving Fund Program, 0.34%*, 8/1/2029 | 30,000,000 | 30,000,000 |
South Dakota, Economic Development Finance Authority, Industrial Development Revenue, Wilson Trailer Project, 144A, AMT, 0.35%*, 2/1/2028, First American Bank (a) | 8,500,000 | 8,500,000 |
| 38,500,000 |
Tennessee 0.7% |
Blount County, TN, Public Building Authority, Local Government Public Improvement, Series C-3-A, 0.3%*, 6/1/2029 | 9,700,000 | 9,700,000 |
Dickson, TN, Redstone Partners Floaters/Residuals Trust, Series B, AMT, 0.47%*, 12/1/2047, Wachovia Bank NA (a) | 3,120,000 | 3,120,000 |
Selmer/McNairy County, TN, Industrial Development Board Revenue, United Stainless, Inc., AMT, 0.4%*, 12/1/2023, Bank of America NA (a) | 8,500,000 | 8,500,000 |
| 21,320,000 |
Texas 17.1% |
Atascosa County, TX, Industrial Development Corp., Pollution Control Revenue, San Miguel Electric Cooperative, Inc., 0.7%*, 6/30/2020 | 40,100,000 | 40,100,000 |
Austin, TX, Hotel Occupancy Tax Revenue, Series A, 0.33%*, 11/15/2029, Dexia Credit Local (a) | 14,625,000 | 14,625,000 |
Belton, TX, Independent School District, 1.0%, 8/15/2010 | 2,440,000 | 2,445,277 |
East Texas, Housing Finance, Redstone Partners Floaters/Residuals Trust, Series D, 144A, AMT, 0.47%*, 12/1/2047, Wachovia Bank NA (a) | 7,945,000 | 7,945,000 |
Harris County, TX, Health Facilities Development Corp., Hospital Revenue, Baylor College of Medicine, Series B, 0.32%*, 11/15/2047, Northern Trust Co. (a) | 6,100,000 | 6,100,000 |
Houston, TX, RBC Municipal Products, Inc. Trust Certificates, Utility Systems Revenue, Series E-14, 144A, 0.3%*, 5/15/2034, Royal Bank of Canada (a) | 24,070,000 | 24,070,000 |
Houston, TX, Water & Sewer System Revenue, Series 27TPZ, 144A, 0.3%*, 12/1/2028 (b) | 14,435,000 | 14,435,000 |
Katy, TX, Independent School Building District, 0.3%*, 8/15/2033 | 8,700,000 | 8,700,000 |
North Texas, Higher Education Authority, Inc., Student Loan Revenue, Series A, AMT, 0.31%*, 12/1/2038, Lloyds TSB Bank PLC (a) | 2,600,000 | 2,600,000 |
San Antonio, TX, Electric & Gas Revenue, 0.3%, 6/10/2010 | 20,000,000 | 20,000,000 |
Tarrant County, TX, Cultural Education Facilities Finance Corp., Retirement Facilities, Northwest Senior Edgemere Project, Series B, 144A, 0.3%*, 11/15/2036, LaSalle Bank NA (a) | 9,505,000 | 9,505,000 |
Tarrant County, TX, Redstone Partners Floaters/Residuals Trust, Series A, 144A, AMT, 0.47%*, 12/1/2047, Wachovia Bank NA (a) | 12,200,000 | 12,200,000 |
Texas, A&M University Revenues, Financing Systems, Series C, 2.0%, 5/15/2010 | 6,620,000 | 6,624,215 |
Texas, BB&T Municipal Trust, Series 2008-57, 144A, 0.31%*, 12/1/2019, Branch Banking & Trust (a) (b) | 17,300,000 | 17,300,000 |
Texas, Capital Area Housing Finance Corp., Cypress Creek at River Apartments, AMT, 0.35%*, 10/1/2039, Citibank NA (a) | 11,000,000 | 11,000,000 |
Texas, Department of Housing, Series 2008-3022X, 144A, AMT, 0.37%*, 9/1/2032 | 5,932,000 | 5,932,000 |
Texas, North East Independent School District, "A", 144A, 0.31%*, 8/1/2037 | 8,935,000 | 8,935,000 |
Texas, Northside Independent School District, School Building, 1.2%**, Mandatory Put 6/1/2010 @100, 6/1/2037 | 28,260,000 | 28,260,000 |
Texas, RBC Municipal Products, Inc. Trust, Series L-46, 144A, AMT, 0.33%*, 12/1/2034, Royal Bank of Canada (a) | 52,995,000 | 52,995,000 |
Texas, State Tax & Revenue Anticipation Notes, 2.5%, 8/31/2010 | 123,500,000 | 124,349,552 |
Texas, University of Houston, Series 2008-3315, 144A, 0.3%*, 2/15/2033 (b) | 9,335,000 | 9,335,000 |
Texas, University of Houston Revenues, 0.27%*, 2/15/2024 | 2,185,000 | 2,185,000 |
Texas, University of Texas Systems Revenue: |
| Series F, 0.23%, 8/2/2010 | 29,276,000 | 29,276,000 |
| Series F, 0.23%, 8/5/2010 | 30,000,000 | 30,000,000 |
| Series F, 0.38%, 10/5/2010 | 9,500,000 | 9,500,000 |
Tyler, TX, Independent School District, School Building, Series A, 0.41%*, 2/15/2025 | 22,000,000 | 22,000,000 |
Weslaco, TX, Health Facilities Development, Knapp Medical Center, Series A, 0.55%*, 6/1/2038, Compass Bank (a) | 4,775,000 | 4,775,000 |
| 525,192,044 |
Utah 0.2% |
Utah, Housing Corp., Series 2008-3300, 144A, AMT, 0.37%*, 1/1/2039 | 5,000,000 | 5,000,000 |
Utah, Transportation Authority Revenue, Series 2008-3045X, 144A, 0.3%*, 6/15/2036 (b) | 2,500,000 | 2,500,000 |
| 7,500,000 |
Virginia 3.0% |
Norfolk, VA, Economic Development Authority, Hospital Facilities Revenue, Sentara Healthcare, Series A, 0.23%*, Mandatory Put 5/13/2011 @ 100, 11/1/2034 | 7,750,000 | 7,750,000 |
Virginia, College Building Authority, Educational Facilities Revenue, University of Richmond: | |
| Series B, 0.35%*, Mandatory Put 2/1/2011 @ 100, 2/26/2039 | 5,000,000 | 5,000,000 |
| Series A, 0.4%*, Mandatory Put 3/1/2011@ 100, 2/26/2039 | 20,000,000 | 20,000,000 |
Virginia, College Building Authority, Educational Facilities Revenue, University of Richmond Project, 0.29%*, 11/1/2036 | 5,000,000 | 5,000,000 |
Virginia, RBC Municipal Products, Inc. Trust: |
| Series C-2, 144A, AMT, 0.39%*, 1/1/2014, Royal Bank of Canada (a) | 9,325,000 | 9,325,000 |
| Series C-8, 144A, AMT, 0.39%*, 9/1/2039, Royal Bank of Canada (a) | 25,665,000 | 25,665,000 |
Virginia, Small Business Financing Authority Revenue, Children's Hospital of the King's Daughters, Inc., 0.31%*, 1/1/2036, Bank of America NA (a) | 16,000,000 | 16,000,000 |
Winchester, VA, Industrial Development Authority, Residential Care Facility Revenue, Westminster-Cantenbury, Series B, 0.3%*, 1/1/2035, Branch Banking & Trust (a) | 2,900,000 | 2,900,000 |
| 91,640,000 |
Washington 2.4% |
Washington, State General Obligation: |
| Series 2599, 144A, 0.3%*, 1/1/2016 | 4,505,000 | 4,505,000 |
| Series 3087, 144A, 0.3%*, 7/1/2016 | 5,055,000 | 5,055,000 |
| Series R-11477, 0.31%*, 7/1/2014 (b) | 5,445,000 | 5,445,000 |
| Series 2010-E, 144A, 2.0%, 2/1/2011 | 10,325,000 | 10,461,015 |
Washington, State Higher Education Facilities Authority Revenue, Seattle University Project, Series A, 0.29%*, 5/1/2028, US Bank NA (a) | 8,905,000 | 8,905,000 |
Washington, State Housing Finance Commission, Multi-Family Housing Revenue, Vintage at Silverdale LLC, Series A, AMT, 0.35%*, 9/15/2039 | 2,000,000 | 2,000,000 |
Washington, State Housing Finance Commission, Multi-Family Revenue, New Tacoma Apartments Project, 0.3%*, 1/1/2040, Wells Fargo Bank NA (a) | 11,400,000 | 11,400,000 |
Washington, State Housing Finance Commission, Nonprofit Revenue, St. Thomas School Project, Series B, 0.3%*, 7/1/2036, Bank of America NA (a) | 10,695,000 | 10,695,000 |
Washington, Tulalip Tribes of The Tulalip Reservation Revenue, Capital Projects, 144A, 0.31%*, 6/1/2019, Wells Fargo Bank NA (a) | 16,630,000 | 16,630,000 |
| 75,096,015 |
West Virginia 1.8% |
West Virginia, Public Energy Authority Revenue, Morgantown Association Project, AMT, 0.45%, 7/1/2017, Dexia Credit Local (a) | 48,000,000 | 48,000,000 |
West Virginia, State Hospital Finance Authority Revenue, Cabell Huntington Hospital, Series B, 0.29%*, 1/1/2034, Branch Banking & Trust (a) | 8,475,000 | 8,475,000 |
| 56,475,000 |
Wisconsin 3.4% |
Ladysmith, WI, Industrial Development Revenue, Indeck Ladysmith LLC Project, Series A, 0.3%*, 8/1/2027, Wells Fargo Bank NA (a) | 10,000,000 | 10,000,000 |
Milwaukee, WI, General Obligation: |
| Series V8, 0.32%*, 2/1/2025 | 2,700,000 | 2,700,000 |
| Series R4, 1.5%, 12/15/2010 | 25,000,000 | 25,175,439 |
Plymouth, WI, Industrial Development Revenue, Masters Gallery Foods, Series A, AMT, 0.47%*, 5/1/2038, Wells Fargo Bank NA (a) | 5,300,000 | 5,300,000 |
Racine, WI, Solid Waste Disposal Revenue, Republic Services Project, 0.3%*, 11/1/2037, JPMorgan Chase Bank (a) | 5,000,000 | 5,000,000 |
University of Wisconsin, Hospitals & Clinics Authority Revenue, Series A, 0.25%*, 4/1/2032, US Bank NA (a) | 100,000 | 100,000 |
Wisconsin, Clipper Tax-Exempt Certificates Trust, Certificate of Participation, Series 2009-36, 144A, 0.35%*, 5/1/2020 | 6,755,000 | 6,755,000 |
Wisconsin, State Operating Notes, 2.5%, 6/15/2010 | 50,000,000 | 50,123,524 |
| 105,153,963 |
Wyoming 1.6% |
Sweetwater County, WY, Pollution Control Revenue, 0.3%, 7/7/2010 | 9,275,000 | 9,275,000 |
Wyoming, Student Loan Corp. Revenue, Series A-3, AMT, 0.33%*, 12/1/2043, Royal Bank of Canada (a) | 40,000,000 | 40,000,000 |
| 49,275,000 |
Cash Account Trust (the "Trust") is registered under the Investment Company Act of 1940, as amended (the "1940 Act"), as an open-end investment management company organized as a Massachusetts business trust.
The Trust offers three portfolios: Money Market Portfolio, Government & Agency Securities Portfolio and Tax-Exempt Portfolio. These financial statements report on Tax-Exempt Portfolio (the "Portfolio").
Tax-Exempt Portfolio offers nine classes of shares: Capital Assets Funds Shares, Davidson Cash Equivalent Shares, DWS Tax-Exempt Cash Institutional Shares, DWS Tax-Exempt Money Fund, DWS Tax-Free Money Fund Class S, Premier Money Market Shares, Service Shares, Tax-Exempt Cash Managed Shares and Tax-Free Investment Class.
The financial highlights for all classes of shares, other than DWS Tax-Exempt Cash Institutional Shares and Tax-Exempt Cash Managed Shares, are provided separately and are available upon request.
The Portfolio's investment income, realized and unrealized gains and losses, and certain Portfolio-level expenses and expense reductions, if any, are borne pro rata on the basis of relative net assets by the holders of all classes of shares of the Portfolio, except that each class bears certain expenses unique to that class such as distribution and service fees, services to shareholders and certain other class-specific expenses. Differences in class-level expenses may result in payment of different per share dividends by class. All shares of the Trust have equal rights with respect to voting subject to class-specific arrangements.
The Portfolio's financial statements are prepared in accordance with accounting principles generally accepted in the United States of America which require the use of management estimates. Actual results could differ from those estimates. The policies described below are followed consistently by the Portfolio in the preparation of its financial statements.
The Portfolio has reviewed the tax positions for the open tax years as of April 30, 2010 and has determined that no provision for income tax is required in the Portfolio's financial statements. The Portfolio's federal tax returns for the prior three fiscal years remain open subject to examination by the Internal Revenue Service.
Permanent book and tax basis differences relating to shareholder distributions will result in reclassifications to paid in capital. Temporary book and tax basis differences will reverse in a subsequent period. There were no significant book-to-tax differences for the Portfolio.
At April 30, 2010, the Portfolio's components of distributable earnings on a tax-basis are as follows:
In addition, during the years ended April 30, 2010 and April 30, 2009, the tax character of distributions paid to shareholders by the Portfolio is summarized as follows:
In addition, the Portfolio pays a monthly management fee based on the combined average daily net assets of the Portfolios and allocated to each Portfolio based on relative net assets, computed and accrued daily and payable monthly, at the following annual rates:
Accordingly, for the year ended April 30, 2010, the Portfolio incurred a management fee equivalent to the following annual effective rate of the Portfolio's average daily net assets:
For the period from May 1, 2009 through September 30, 2010, the Advisor has contractually agreed to waive its fees and/or reimburse certain operating expenses of the DWS Tax-Exempt Cash Institutional Shares to the extent necessary to maintain the operating expenses (excluding certain expenses such as extraordinary expenses, taxes, brokerage and interest) at 0.20%.
The Advisor also has agreed to maintain expenses of certain other classes of the Trust. These rates are disclosed in the respective share classes' annual reports that are provided separately and are available upon request.
In addition, the Advisor has agreed to voluntarily waive additional expenses. The waiver may be changed or terminated at any time without notice. Under these arrangements, the Advisor waived certain expenses on Tax-Exempt Cash Managed Shares.
In addition, DIDI provides information and administrative services for a fee ("Service Fee") for the shares listed in the following table. A portion of these fees may be paid pursuant to a Rule 12b-1 plan.
The Tax-Exempt Portfolio has entered into an arrangement with its custodian whereby credits realized as a result of uninvested cash balances are used to reduce a portion of the Portfolio's custodian expenses. During the year ended April 30, 2010, the Portfolio's custodian fee was reduced as follows:
From time to time, the Portfolio may have a concentration of several shareholders holding a significant percentage of shares outstanding. Investment activities of these shareholders could have a material impact on the Portfolio.
At April 30, 2010, one shareholder held approximately 35% of the outstanding shares of the Tax-Exempt Portfolio.
The Portfolio and other affiliated funds (the "Participants") share in a $450 million revolving credit facility provided by a syndication of banks. The Portfolio may borrow for temporary or emergency purposes, including the meeting of redemption requests that otherwise might require the untimely disposition of securities. The Participants are charged an annual commitment fee which is allocated based on net assets, among each of the Participants. Interest is calculated at a rate per annum equal to the sum of the Federal Funds Rate plus 1.25 percent plus, if LIBOR exceeds the Federal Funds Rate, the amount of such excess. The Portfolio may borrow up to a maximum of 33 percent of its net assets under the agreement.
The Portfolio participated in the Temporary Guarantee Program for Money Market Funds (the "Program") established by the U.S. Department of the Treasury (the "Treasury"). The Program was teminated on September 18, 2009.
The Portfolio paid the expenses of participating in the Program. The expense was determined by the product of (i) the number of shares outstanding of each class as of September 19, 2008 valued at $1.00; and (ii) the applicable Program participation fee rate, which was based upon the market-based net asset value outstanding of each share class as of September 19, 2008. For the initial period ending December 18, 2008, the Program participation fee was equal to 0.010%. For the coverage under the Program beginning on December 19, 2008 and ending on April 30, 2009, the Program participation fee was equal to 0.015%. For the coverage under the Program beginning on May 1, 2009 and ending September 18, 2009, the Program participation fee was equal to 0.015%. This expense was being amortized over the length of the participation in the Program and is included in "Temporary guarantee program participation fee" on the Statement of Operations. For the period from May 1, 2009 through September 18, 2009, the Portfolio accrued $610,785. This expense was born by the Portfolio without regard to any expense limitation currently in effect for the Portfolio.
Neither the Portfolio nor Deutsche Investment Management Americas Inc., the Portfolio's investment advisor, are in any manner approved, endorsed, sponsored or authorized by the Treasury.
Management has evaluated the events and transactions subsequent to year end through the date the financial statements were available to be issued, and has determined that there were no material events that would require disclosure in the Portfolio's financial statements.
We have audited the accompanying statement of assets and liabilities of the Tax-Exempt Portfolio (the "Portfolio"), one of the portfolios constituting Cash Account Trust (the "Trust"), including the investment portfolio, as of April 30, 2010, and the related statement of operations for the year then ended, the statement of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the periods indicated therein. These financial statements and financial highlights are the responsibility of the Trust's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. We were not engaged to perform an audit of the Trust's internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Trust's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements and financial highlights, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of April 30, 2010, by correspondence with the custodian. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the Tax-Exempt Portfolio of Cash Account Trust at April 30, 2010, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the periods indicated therein, in conformity with U.S. generally accepted accounting principles.
Of the dividends paid from net investment income for the taxable year ended April 30, 2010, 100% are designated as exempt interest dividends for federal income tax purposes.
Please consult a tax advisor if you have questions about federal or state income tax laws, or on how to prepare your tax returns. If you have specific questions about your account, please call (800) 621-1048.
Pursuant to an Order entered into by Deutsche Investment Management Americas and affiliates (collectively, "DeAM") with the Attorney General of New York, I, Thomas H. Mack, have been appointed the Independent Fee Consultant for the DWS Funds (formerly the DWS Scudder Funds). My duties include preparing an annual written evaluation of the management fees DeAM charges the Funds, considering among other factors the management fees charged by other mutual fund companies for like services, management fees DeAM charges other clients for like services, DeAM's costs of supplying services under the management agreements and related profit margins, possible economies of scale if a Fund grows larger, and the nature and quality of DeAM's services, including fund performance. This report summarizes my evaluation for 2009, including my qualifications, the evaluation process for each of the DWS Funds, consideration of certain complex-level factors, and my conclusions. I served in substantially the same capacity in 2007 and 2008.
For more than 35 years I have served in various professional capacities within the investment management business. I have held investment analysis and advisory positions, including securities analyst, portfolio strategist and director of investment policy with a large investment firm. I have also performed business management functions, including business development, financial management and marketing research and analysis.
Since 1991, I have been an independent consultant within the asset management industry. I have provided services to over 125 client organizations, including investment managers, mutual fund boards, product distributors and related organizations. Over the past ten years I have completed a number of assignments for mutual fund boards, specifically including assisting boards with management contract renewal.
I hold a Master of Business Administration degree, with highest honors, from Harvard University and Master of Science and Bachelor of Science (highest honors) degrees from the University of California at Berkeley. I am an independent director and audit committee financial expert for two closed-end mutual funds and serve in various leadership and financial oversight capacities with non-profit organizations.
My work focused primarily on evaluating, fund-by-fund, the fees charged to each of the 124 publicly offered Fund portfolios in the DWS Fund family. For each Fund, I considered each of the key factors mentioned above, as well as any other relevant information. In doing so I worked closely with the Funds' Independent Directors in their annual contract renewal process, as well as in their approval of contracts for several new funds (documented separately).
In evaluating each Fund's fees, I reviewed comprehensive materials provided by or on behalf of DeAM, including expense information prepared by Lipper Analytical, comparative performance information, profitability data, manager histories, and other materials. I also accessed certain additional information from the Lipper, Strategic Insight, and Morningstar databases and drew on my industry knowledge and experience.
To facilitate evaluating this considerable body of information, I prepared for each Fund a document summarizing the key data elements in each area as well as additional analytics discussed below. This made it possible to consider each key data element in the context of the others.
In the course of contract renewal, DeAM agreed to implement a number of fee and expense adjustments requested by the Independent Directors which will favorably impact future fees and expenses, and my evaluation includes the effects of these changes.
The competitive fee and expense evaluation for each fund focused on two primary comparisons:
The Fund's contractual management fee (the advisory fee plus the administration fee where applicable) compared with those of a group of typically 12-15 funds in the same Lipper investment category (e.g. Large Capitalization Growth) having similar distribution arrangements and being of similar size.
The Fund's total expenses compared with a broader universe of funds from the same Lipper investment category and having similar distribution arrangements.
These two comparisons provide a view of not only the level of the fee compared with funds of similar scale but also the total expense the Fund bears for all the services it receives, in comparison with the investment choices available in the Fund's investment category and distribution channel. The principal figure-of-merit used in these comparisons was the subject Fund's percentile ranking against peers.
DeAM provided management fee schedules for all of its US domiciled fund and non-fund investment management accounts in any of the investment categories where there is a DWS Fund. These similar products included the other DWS Funds, non-fund pooled accounts, institutional accounts and sub-advisory accounts. Using this information, I calculated for each Fund the fee that would be charged to each similar product, at the subject Fund's asset level.
Evaluating information regarding non-fund products is difficult because there are varying levels of services required for different types of accounts, with mutual funds generally requiring considerably more regulatory and administrative types of service as well as having more frequent cash flows than other types of accounts. Also, while mutual fund fees for similar fund products can be expected to be similar, there will be some differences due to different pricing conditions in different distribution channels (e.g. retail funds versus those used in variable insurance products), differences in underlying investment processes and other factors.
DeAM provided a detailed profitability analysis for each Fund. After making some adjustments so that the presentation would be more comparable to the available industry figures, I reviewed profit margins from investment management alone, from investment management plus other fund services (excluding distribution) provided to the Funds by DeAM (principally shareholder services), and DeAM profits from all sources, including distribution. A later section comments on overall profitability.
Economies of scale — an expected decline in management cost per dollar of fund assets as fund assets grow — are very rarely quantified and documented because of inherent difficulties in collecting and analyzing relevant data. However, in virtually every investment category that I reviewed, larger funds tend to have lower fees and lower total expenses than smaller funds. To see how each DWS Fund compares with this industry observation, I reviewed:
The trend in Fund assets over the last five years and the accompanying trend in total expenses. This shows if the Fund has grown and, if so, whether total expense (management fees as well as other expenses) have declined as a percent of assets.
Whether the Fund has break-points in its management fee schedule, the extent of the fee reduction built into the schedule and the asset levels where the breaks take effect, and in the case of a sub-advised Fund how the Fund's break-points compare with those of the sub-advisory fee schedule.
How the Fund's contractual fee schedule compares with trends in the industry data. To accomplish this, I constructed a chart showing how actual latest-fiscal-year contractual fees of the Fund and of other similar funds relate to average fund assets, with the subject Fund's contractual fee schedule superimposed.
The quality-of-service evaluation focused on investment performance, which is the principal result of the investment management service. Each Fund's performance was reviewed over the past 1, 3, 5 and 10 years, as applicable, and compared with that of other funds in the same investment category and with a suitable market index.
In addition, I calculated and reviewed risk-adjusted returns relative to an index of similar mutual funds' returns and a suitable market index. The risk-adjusted returns analysis provides a way of determining the extent to which the Fund's return comparisons are mainly the product of investment value-added (or lack thereof) or alternatively taking considerably more or less risk than is typical in its investment category.
I also received and considered the history of portfolio manager changes for each Fund, as this provided an important context for evaluating the performance results.
While this evaluation was conducted mainly at the individual fund level, there are some issues relating to the reasonableness of fees that can alternatively be considered across the whole fund complex:
I reviewed DeAM's profitability analysis for all DWS Funds, with a view toward determining if the allocation procedures used were reasonable and how profit levels compared with public data for other investment managers.
I considered whether DeAM and affiliates receive any significant ancillary or "fall-out" benefits that should be considered in interpreting the direct profitability results. These would be situations where serving as the investment manager of the Funds is beneficial to another part of the Deutsche Bank organization.
I considered how aggregated DWS Fund expenses had varied over the years, by asset class and in the context of trends in asset levels.
I reviewed the structure of the DeAM organization, trends in staffing levels, and information on compensation of investment management and other professionals compared with industry data.
Based on the process and analysis discussed above, which included reviewing a wide range of information from management and external data sources and considering among other factors the fees DeAM charges other clients, the fees charged by other fund managers, DeAM's costs and profits associated with managing the Funds, economies of scale, possible fall-out benefits, and the nature and quality of services provided, in my opinion the management fees charged the DWS Funds are reasonable.
The following table presents certain information regarding the Board Members and Officers of the Trust as of April 30, 2010. Each Board Member's year of birth is set forth in parentheses after his or her name. Unless otherwise noted, (i) each Board Member has engaged in the principal occupation(s) noted in the table for at least the most recent five years, although not necessarily in the same capacity; and (ii) the address of each Independent Board Member is c/o Paul K. Freeman, Independent Chairman, DWS Funds, PO Box 101833, Denver, CO 80250-1833. Except as otherwise noted below, the term of office for each Board Member is until the election and qualification of a successor, or until such Board Member sooner dies, resigns, is removed or as otherwise provided in the governing documents of the fund. Because the fund does not hold an annual meeting of shareholders, each Board Member will hold office for an indeterminate period. The Board Members may also serve in similar capacities with other funds in the fund complex. The Length of Time Served represents the year in which the Board Member joined the board of one or more DWS funds now overseen by the Board.
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.
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.
