As filed with the Securities and Exchange Commission on October 29, 2003
Investment Company Act file number 811-8654
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF
REGISTERED MANAGEMENT INVESTMENT COMPANIES
Florida Daily Municipal Income Fund
(Exact name of registrant as specified in charter)
600 Fifth Avenue
New York, NY 10020
(Address of principal executive offices) (Zip code)
Rosanne Holtzer
c/o Reich & Tang Asset Management, LLC
600 Fifth Avenue
New York, New York 10020
(Name and address of agent for service)
Registrant's telephone number, including area code: 212-830-5200
Date of fiscal year end: 08/31
Date of reporting period: 08/31/2003
ITEM 1: REPORT TO STOCKHOLDERS
- --------------------------------------------------------------------------------
FLORIDA
DAILY MUNICIPAL 600 FIFTH AVENUE, NEW YORK, N.Y. 10020
INCOME FUND (212)830-5200
================================================================================
Dear Shareholder:
We are pleased to present the annual report of Florida Daily Municipal Income
Fund for the year ended August 31, 2003.
The Fund had net assets of $116,307,133 and 1,659 active shareholders as of
August 31, 2003.
We thank you for your support and look forward to continuing to serve your cash
management needs.
Sincerely,
\s\Steven W. Duff
Steven W. Duff
President
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FLORIDA DAILY MUNICIPAL INCOME FUND
STATEMENT OF NET ASSETS
AUGUST 31, 2003
================================================================================
Ratings (a)
-----------------
Face Maturity Value Standard
Amount Date Yield (Note 1) Moody's & Poor's
------ ---- ----- ------ ------- --------
Tax Exempt Commercial Paper (14.46%)
- ------------------------------------------------------------------------------------------------------------------------------------
$ 7,000,000 Jacksonville, FL HEFA HRB - Series 2003B
LOC Bank of America 04/01/04 0.90% $ 7,000,000 A1+
4,013,000 Miami-Dade County, FL Aviation Notes 09/10/03 0.95 4,013,000 P1 A1+
3,200,000 Palm Beach County, FL (Pooled Hospital Loan)
LOC Suntrust Bank 11/06/03 0.85 3,200,000 VMIG-1 A1+
1,200,000 Sunshine State Government Financing Commission
Revenue Notes (Miami-Dade Program) - Series G 10/08/03 0.90 1,200,000 A1+
1,400,000 Sunshine State Government Financing Commission
Revenue Notes - Series F 10/10/03 0.88 1,400,000 A1+
- ----------- -------------
16,813,000 Total Tax Exempt Commercial Paper 16,813,000
- ----------- -------------
Tax Exempt General Obligation Notes & Bonds (14.90%)
- ------------------------------------------------------------------------------------------------------------------------------------
$ 2,500,000 Commonwealth of Puerto Rico Public Improvement Bonds
TOCS - Series 2001-1
Insured by FSA 05/26/04 0.95% $ 2,500,000 A1+
1,510,000 Coral Springs, FL (Water & Sewer) (b) 09/01/03 1.46 1,510,000
2,235,250 High Springs, FL BAN RB (Water & Sewer) - Series 2002 (b) 01/15/04 1.40 2,241,180
2,500,000 Puerto Rico Commonwealth Infrastructure Financing Authority 06/16/04 1.00 2,500,000 A1+
5,500,000 Seminole County, FL School District TAN 08/20/04 1.00 5,552,649 MIG-1
3,000,000 State of Texas TRAN 08/31/04 1.16 3,024,780 MIG-1 SP-1+
- ----------- -------------
17,245,250 Total Tax Exempt General Obligation Notes & Bonds 17,328,609
- ----------- -------------
Variable Rate Demand Instruments (c) (74.28%)
- ------------------------------------------------------------------------------------------------------------------------------------
$ 1,000,000 Alachua County, FL IDA (Florida Rock Industries, Inc.)
LOC Nationsbank 11/01/22 0.95% $ 1,000,000 A1+
3,100,000 Collier County, FL IDA Health Care Facilities RB
(NCH Healthcare Systems, Inc.) - Series 2002
LOC Fifth Third Bank 11/01/22 0.83 3,100,000 A1+
2,500,000 Dade County, FL RB (Water & Sewer System) - Series 1994
Insured by FGIC 10/05/22 0.79 2,500,000 VMIG-1 A1+
1,348,000 Duval & Escambia Counties, FL Clipper - Series 2000-3 03/27/05 1.08 1,348,000 VMIG-1
3,115,000 Escambia County, FL IDRB (Gelman Sciences, Inc. Project)
LOC National Bank of Detroit 07/01/04 0.95 3,115,000 A1+
5,625,000 Florida COPS (Gulf Coast University Foundation Inc.)
LOC Wachovia Bank & Trust Company, N.A. 08/01/32 0.90 5,625,000 VMIG-1
4,000,000 Florida Finance Authority Continuing Care Retirement Commission RB
(Glenridge Capital Project) - Series 2002C
LOC Bank of Scotland 06/01/12 0.80 4,000,000 VMIG-1
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The accompanying notes are an integral part of these financial statements.
================================================================================
Ratings (a)
-----------------
Face Maturity Value Standard
Amount Date Yield (Note 1) Moody's & Poor's
------ ---- ----- ------ ------- --------
Variable Rate Demand Instruments (c) (continued)
- ------------------------------------------------------------------------------------------------------------------------------------
$ 1,125,000 Florida HFA Banyon Bay (Bainbridge Apartment Project)
Guaranteed by Federal National Mortgage Association 12/01/25 0.85% $ 1,125,000 VMIG-1
1,000,000 Florida HFA (Heron Park Project) - Series 1996U
Guaranteed by Federal National Mortgage Association 12/01/29 0.85 1,000,000 VMIG-1
1,900,000 Florida HFA MHRB (Huntington) - Series GGG
LOC HSBC Bank US 12/01/13 0.82 1,900,000 A1+
1,000,000 Florida HFA MHRB (Town of Colony) - Series EE
LOC Credit Suisse First Boston 09/01/08 0.90 1,000,000 A1+
2,620,000 Florida HFA (Multifamily 1995 Remarketing)
Guaranteed by Federal National Mortgage Association 12/01/05 0.78 2,620,000 A1+
2,850,000 Florida HFA P-Floats - Series PT-88
Guaranteed by FHA/VA/Private Mortgages 01/01/15 0.93 2,850,000 A1+
900,000 Florida HFA (Timberland Apartments)
Collateralized by Federal National Mortgage Association 10/15/32 0.90 900,000 A1+
2,375,000 Florida HFC MHRB (Charleston Landing) - Series 1-A
Guaranteed by Federal Home Loan Mortgage Corporation 07/01/31 0.85 2,375,000 A1+
3,760,000 Florida HFC MHRB (Heather Glenn Apartment) - Series H
LOC Amsouth Bank, N.A. 06/15/36 0.91 3,760,000 VMIG-1
1,850,000 Gainesville, FL IDRB (Heat-Pipe Technology, Inc. Project) (b)
LOC Amsouth Bank, N.A. 05/01/18 0.95 1,850,000
155,000 Gulf Breeze, FL RB - Series 1985B
Insured by FGIC 12/01/15 0.85 155,000 VMIG-1 A1+
435,000 Gulf Breeze, FL RB - Series 1985C
Insured by FGIC 12/01/15 0.85 435,000 VMIG-1 A1+
600,000 Indian River County, FL IDRB (Florida Convention Center Project)
LOC Toronto Dominion Bank 01/01/11 1.25 600,000 P1
2,600,000 Jacksonville, FL (University Health Science Center) - Series 1989 07/01/19 0.90 2,600,000 VMIG-1
1,700,000 King George County, VA IDA RB (Birchwood Power Partners)
LOC Credit Suisse First Boston 11/01/25 0.90 1,700,000 A1+
2,458,275 Koch Floating Rate Trust
Insured by AMBAC Indemnity Corp. 05/03/04 1.08 2,458,275 A1+
5,000,000 Lee County, FL Solid Waste System Trust Receipts RB - Series L24J
Insured by MBIA Insurance Corp. 10/01/12 1.00 5,000,000 VMIG-1
1,100,000 Macomb County, MI Hospital Finance Authority RB
(Mt. Clemens General) - Series A1
LOC Comerica Bank 10/01/20 0.80 1,100,000 VMIG-1
2,680,000 Manatee County, FL HFA MHRB
(Hampton Court Project) - Series 1989A
LOC Credit Suisse First Boston 06/01/07 0.85 2,680,000 A1
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The accompanying notes are an integral part of these financial statements.
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FLORIDA DAILY MUNICIPAL INCOME FUND
STATEMENT OF NET ASSETS (CONTINUED)
AUGUST 31, 2003
================================================================================
Ratings (a)
-----------------
Face Maturity Value Standard
Amount Date Yield (Note 1) Moody's & Poor's
------ ---- ----- ------ ------- --------
Variable Rate Demand Instruments (c) (continued)
- ------------------------------------------------------------------------------------------------------------------------------------
$ 1,450,000 Marion County, FL IDA
(Hamilton Products, Inc. Project) - Series 1995 (b)
LOC Comerica Bank 11/01/15 1.15% $ 1,450,000
4,800,000 Miami-Dade County, FL IDA Professional Modification
LOC HSBC Bank US 08/01/18 0.95 4,800,000 A1
1,400,000 Michigan State Strategic Fund (Detroit Symphony) - Series A
LOC Standard Federal Bank, N.A. 06/01/31 0.80 1,400,000 A1+
500,000 Missouri HEFA (Washington University) 07/01/32 0.85 500,000 VMIG-1
1,700,000 Nebraska HEFA RB (Creighton University Project)
Insured by AMBAC Indemnity Corp. 03/01/33 0.80 1,700,000 VMIG-1
1,900,000 New York City, NY GO - Series E-3
LOC Westdeutche Landesbank 08/01/23 0.75 1,900,000 VMIG-1 A1+
1,800,000 Ocean Highway & Port Authority, FL RB - Series 1990
LOC Wachovia Bank & Trust Company, N.A. 12/01/20 0.95 1,800,000 VMIG-1 A1+
650,000 Orange County, FL IDA RB
(Florida Convention Center Project) - Series A
LOC Toronto Dominion Bank 01/01/11 1.15 650,000 P1
1,900,000 Palm Beach County, FL IDRB (Palm Beach Community Foundation)
LOC Northern Trust Bank 07/01/34 0.87 1,900,000 A1+
1,000,000 Palm Beach County, FL RB (Norton Gallery)
LOC Bank of America 05/01/30 0.87 1,000,000 A1+
600,000 Polk County, FL IDA RB (Florida Convention Center Project)
LOC Toronto Dominion Bank 01/01/11 1.15 600,000 P1
7,000,000 Port Orange, FL RB (Palmer College Project) - Series 2002
LOC LaSalle National Bank 10/01/32 0.84 7,000,000 A1+
1,000,000 State of Florida
Insured by FGIC 07/01/16 0.90 1,000,000 A1+
2,000,000 Sunshine State Government Financing Commission RB - Series 1986
Insured by AMBAC Indemnity Corp. 07/01/16 0.85 2,000,000 VMIG-1
1,900,000 University Athletic Association, Inc.
(University of Florida Stadium Project)
LOC SunTrust Bank 02/01/20 0.95 1,900,000 VMIG-1
- ----------- ------------
86,396,275 Total Variable Rate Demand Instruments 86,396,275
- ----------- ------------
Total Investments (103.64%) (Cost $120,537,884+) 120,537,884
Liabilities in excess of cash and other assets (-3.64%) ( 4,230,751)
------------
Net Assets (100.00%) $ 116,307,133
============
Net Asset Value, offering and redemption price per share:
Class A shares, 58,994,071 Shares Outstanding (Note 3) $ 1.00
============
Class B shares, 57,313,308 Shares Outstanding (Note 3) $ 1.00
============
<FN>
+ Aggregate cost for federal income tax purposes is identical.
</FN>
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The accompanying notes are an integral part of these financial statements.
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================================================================================
FOOTNOTES:
(a) Unless the variable rate demand instruments are assigned their own ratings,
the ratings are those of the holding company of the bank whose letter of
credit guarantees the issue or the insurance company who insures the issue.
All letters of credit and insurance are irrevocable and direct pay covering
both principal and interest. Ratings are unaudited.
In addition, certain issuers may have either a line of credit, a liquidity
facility, a standby purchase agreement or some other financing mechanism to
ensure the remarketing of the securities. This is not a guarantee and does
not serve to insure or collateralize the issue.
(b) Securities that are not rated which the Fund's Board of Trustees has
determined to be of comparable quality to those rated securities in which
the Fund invests.
(c) Securities payable on demand at par including accrued interest (usually
with seven days notice) and if indicated, unconditionally secured as to
principal and interest by a bank letter of credit. The interest rates are
adjustable and are based on bank prime rates or other interest rate
adjustment indices. The rate shown is the rate in effect at the date of
this statement.
KEY:
BAN = Bond Anticipation Note IDA = Industrial Development Authority
COPS = Certificates of Participation IDRB = Industrial Development Revenue Bond
FGIC = Financial Guaranty Insurance Company LOC = Letter of Credit
FHA = Federal Housing Administration MHRB = Multi-Family Housing Revenue Bond
FSA = Financial Security Assurance RB = Revenue Bond
GO = General Obligation TAN = Tax Anticipation Note
HEFA = Health and Education Facilities Authority TOCS = Tender Option Certificates
HFA = Housing Finance Authority TRAN = Tax and Revenue Anticipation Note
HFC = Housing Finance Commission VA = Veterans Association
HRB = Housing Revenue Bond
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The accompanying notes are an integral part of these financial statements.
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FLORIDA DAILY MUNICIPAL INCOME FUND
STATEMENT OF OPERATIONS
YEAR ENDED AUGUST 31, 2003
================================================================================
INVESTMENT INCOME
Income:
Interest..................................................................... $ 1,430,333
-----------------
Expenses: (Note 2)
Investment management fee.................................................... 460,541
Administration fee........................................................... 241,784
Shareholder servicing fee (Class A).......................................... 135,536
Custodian fee................................................................ 10,693
Shareholder servicing and related shareholder expenses+...................... 92,391
Legal, compliance and filing fees............................................ 63,657
Audit and accounting......................................................... 119,052
Trustees' fees and expenses.................................................. 7,536
Other........................................................................ 5,565
----------------
Total expenses............................................................ 1,136,755
Less: Expenses paid indirectly (Note 2)................................... ( 2,230)
Fees waived (Note 2)++.............................................. ( 209,822)
----------------
Net expenses.............................................................. 924,703
----------------
Net investment income........................................................... 505,630
REALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain (loss) on investments......................................... -0-
-----------------
Increase in net assets from operations.......................................... $ 505,630
=================
<FN>
+ Includes class specific transfer agency expenses of $35,239 and $33,506 for
Class A and Class B shares, respectively.
++ Includes class specific shareholder servicing fees waived of $10,687 for
Class A shares.
</FN>
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The accompanying notes are an integral part of these financial statements.
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FLORIDA DAILY MUNICIPAL INCOME FUND
STATEMENTS OF CHANGES IN NET ASSETS
YEARS ENDED AUGUST 31, 2003 AND 2002
================================================================================
2003 2002
----------------- -----------------
INCREASE (DECREASE) IN NET ASSETS
Operations:
Net investment income.......................................... $ 505,630 $ 886,988
Net realized gain (loss) on investments........................ -0- -0-
----------------- -----------------
Increase in net assets from operations............................ 505,630 886,988
Dividends to shareholders from:
Net investment income:
Class A........................................................ ( 159,566)* ( 381,431)*
Class B........................................................ ( 346,064)* ( 505,557)*
Transactions in shares of beneficial interest (Note 3):
Class A........................................................ 11,329,859 ( 38,908)
Class B........................................................ 2,787,807 11,368,683
----------------- -----------------
Total increase............................................. 14,117,666 11,329,775
Net assets:
Beginning of year.............................................. 102,189,467 90,859,692
----------------- -----------------
End of year.................................................... $ 116,307,133 $ 102,189,467
================= =================
<FN>
* Designated as exempt-interest dividends for federal income tax
purposes.
</FN>
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The accompanying notes are an integral part of these financial statements.
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FLORIDA DAILY MUNICIPAL INCOME FUND
NOTES TO FINANCIAL STATEMENTS
================================================================================
1. Summary of Accounting Policies
Florida Daily Municipal Income Fund (the "Fund"), a Massachusetts Business
Trust, is a no-load, non-diversified, open-end management investment company
registered under the Investment Company Act of 1940. The Fund is a short-term,
tax exempt money market fund. The Fund has two classes of stock authorized,
Class A and Class B. The Class A shares are subject to a service fee pursuant to
the Distribution and Service Plan. The Class B shares are not subject to a
service fee. Additionally, the Fund may allocate among its classes certain
expenses, to the extent allowable to specific classes, including transfer agent
fees, government registration fees, certain printing and postage costs, and
administrative and legal expenses. Class specific expenses of the Fund were
limited to service fees and transfer agent expenses. In all other respects the
Class A and Class B shares represent the same interest in the income and assets
of the Fund. The Fund's financial statements are prepared in accordance with
accounting principles generally accepted in the United States of America for
investment companies as follows:
a) Valuation of Securities -
Investments are valued at amortized cost. Under this valuation method, a
portfolio instrument is valued at cost and any discount or premium is
amortized on a constant basis to the maturity of the instrument. The
maturity of variable rate demand instruments is deemed to be the longer of
the period required before the Fund is entitled to receive payment of the
principal amount or the period remaining until the next interest rate
adjustment.
b) Federal Income Taxes -
It is the Fund's policy to comply with the requirements of the Internal
Revenue Code applicable to regulated investment companies and to distribute
all of its tax exempt and taxable income to its shareholders. Therefore, no
provision for federal income tax is required.
c) Dividends and Distributions -
Dividends from investment income (excluding capital gains and losses, if
any, and amortization of market discount) are declared daily and paid
monthly. Distributions of net capital gains, if any, realized on sales of
investments are made after the close of the Fund's fiscal year, as declared
by the Fund's Board of Trustees.
d) Use of Estimates -
The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires
management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the reported
amounts of increases and decreases in net assets from operations during the
reporting period. Actual results could differ from those estimates.
e) General -
Securities transactions are recorded on a trade date basis. Interest income
including accretion of discount and amortization of premium, is accrued as
earned. Realized gains and losses from securities transactions are recorded
on the identified cost basis.
2. Investment Management Fees and Other Transactions with Affiliates
Under the Investment Management Contract, the Fund pays an investment management
fee to Reich & Tang Asset Management, LLC (the "Manager") at the annual rate of
..40% of the Fund's average daily net assets.
- --------------------------------------------------------------------------------
================================================================================
2. Investment Management Fees and Other Transactions with Affiliates
(Continued)
Pursuant to an Administrative Services Contract the Fund pays to the Manager an
annual fee of .21% of the Fund's average daily net assets.
Pursuant to a Distribution Plan adopted under Securities and Exchange Commission
Rule 12b-1, the Fund and Reich & Tang Distributors, Inc. (the "Distributor")
have entered into a Distribution Agreement and a Shareholder Servicing
Agreement, only with respect to Class A shares of the Fund. For its services
under the Shareholder Servicing Agreement, the Distributor receives from the
Fund a fee equal to .25% of the Fund's average daily net assets with respect
only to the Class A shares. There were no additional expenses borne by the Fund
pursuant to the Distribution Plan.
During the year ended August 31, 2003 the Manager voluntarily waived investment
management and administration fees of $10,531 and $188,604 respectively. In
addition, the Distributor voluntarily waived shareholder servicing fees of
$10,687 for Class A.
Fees are paid to Trustees who are unaffiliated with the Manager on the basis of
$1,000 per annum plus $250 per meeting attended.
Included in the Statement of Operations under the caption "Shareholder servicing
and related shareholder expenses" are fees of $59,793 paid to Reich & Tang
Services, Inc., an affiliate of the Manager, as shareholder servicing agent for
the Fund. Also included under the same caption are expense offsets of $2,230.
3. Transactions in Shares of Beneficial Interest
At August 31, 2003, an unlimited number of shares of beneficial interest ($.001
par value) were authorized and paid in capital amounted to $116,307,379.
Transactions, all at $1.00 per share, were as follows:
Year Year
Ended Ended
Class A August 31, 2003 August 31, 2002
------- --------------- ---------------
Sold............................................ 267,571,854 216,266,031
Issued on reinvestment of dividends............. 166,272 380,624
Redeemed........................................ ( 256,408,267) ( 216,685,563)
---------------- ----------------
Net increase (decrease)......................... 11,329,859 ( 38,908)
================ ================
Class B
-------
Sold............................................ 165,348,413 176,675,854
Issued on reinvestment of dividends............. 65,329 400,202
Redeemed........................................ ( 162,625,935) ( 165,707,373)
---------------- ----------------
Net increase.................................... 2,787,807 11,368,683
================ ================
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FLORIDA DAILY MUNICIPAL INCOME FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
4. Tax Information
Accumulated undistributed realized losses at August 31, 2003 amounted to $246.
Such amount represents tax basis capital losses which may be carried forward to
offset future capital gains through August 31, 2008.
At August 31, 2003, the Fund had undistributed tax exempt income of $5,412 for
income tax purposes included in dividends payable.
5. Concentration of Credit Risk
The Fund invests primarily in obligations of political subdivisions of the State
of Florida and, accordingly, is subject to the credit risk associated with the
non-performance of such issuers. Approximately 79% of these investments are
further secured, as to principal and interest, by credit enhancements such as
letters of credit, municipal bond insurance and guarantees issued by financial
institutions. The Fund maintains a policy of monitoring its exposure by
reviewing the creditworthiness of the issuers, as well as that of the financial
institutions issuing the credit enhancements, and by limiting the amount of
holdings with credit enhancements from one financial institution.
6. Financial Highlights
Year Ended August 31,
------------------------------------------------------------
Class A 2003 2002 2001 2000 1999
- ------- -------- -------- -------- -------- --------
Per Share Operating Performance:
(for a share outstanding throughout the year)
Net asset value, beginning of year............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- --------
Income from investment operations:
Net investment income....................... 0.003 0.008 0.027 0.031 0.025
Less distributions:
Dividends from net investment income........ ( 0.003) ( 0.008) ( 0.027) ( 0.031) ( 0.025)
------- ------- ------- ------- -------
Net asset value, end of year................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======== ======== ======== ======== ========
Total Return................................... 0.31% 0.81% 2.78% 3.09% 2.50%
Ratios/Supplemental Data
Net assets, end of year (000).................. $ 58,994 $ 47,664 $ 47,703 $ 59,029 $ 48,863
Ratios to average net assets:
Expenses(a) (Net of fees waived)............... 0.93% 0.90% 0.84% 0.85% 0.78%
Net investment income.......................... 0.29% 0.79% 2.79% 3.06% 2.51%
Management and administration fees waived...... 0.17% 0.26% 0.21% 0.30% 0.29%
Shareholder servicing fees waived.............. 0.02% 0.00% 0.00% 0.00% 0.00%
Expenses paid indirectly....................... 0.00% 0.00% 0.00% 0.00% 0.00%
<FN>
(a) Includes expenses paid indirectly
</FN>
- --------------------------------------------------------------------------------
================================================================================
6. Financial Highlights (Continued)
Year Ended August 31,
------------------------------------------------------------
Class B 2003 2002 2001 2000 1999
- ------- -------- -------- -------- -------- --------
Per Share Operating Performance:
(for a share outstanding throughout the year)
Net asset value, beginning of year............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- --------
Income from investment operations:
Net investment income....................... 0.006 0.011 0.030 0.033 0.028
Less distributions:
Dividends from net investment income........ ( 0.006) ( 0.011) ( 0.030) ( 0.033) ( 0.028)
------- ------- ------- ------- -------
Net asset value, end of year................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======== ======== ======== ======== ========
Total Return................................... 0.55% 1.08% 3.07% 3.39% 2.80%
Ratios/Supplemental Data
Net assets, end of year (000).................. $ 57,313 $ 54,525 $ 43,157 $ 28,786 $ 24,448
Ratios to average net assets:
Expenses(a) (Net of fees waived)............... 0.69% 0.63% 0.57% 0.56% 0.50%
Net investment income.......................... 0.57% 1.06% 2.95% 3.35% 2.78%
Management and administration fees waived...... 0.17% 0.26% 0.21% 0.30% 0.29%
Expenses paid indirectly....................... 0.00% 0.00% 0.00% 0.00% 0.00%
<FN>
(a) Includes expenses paid indirectly
</FN>
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FLORIDA DAILY MUNICIPAL INCOME FUND
REPORT OF INDEPENDENT AUDITORS
================================================================================
To the Board of Trustees and Shareholders of
Florida Daily Municipal Income Fund
In our opinion, the accompanying statement of net assets and the related
statements of operations and of changes in net assets and the financial
highlights present fairly, in all material respects, the financial position of
Florida Daily Municipal Income Fund (the "Fund") at August 31, 2003, 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 five years in the period then ended, in conformity with accounting
principles generally accepted in the United States of America. These financial
statements and financial highlights (hereafter referred to as "financial
statements") are the responsibility of the Fund's management; our responsibility
is to express an opinion on these financial statements based on our audits. We
conducted our audits of these financial statements in accordance with auditing
standards generally accepted in the United States of America, which require that
we plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements, assessing the accounting principles used and
significant estimates made by management, and evaluating the overall financial
statement presentation. We believe that our audits, which included confirmation
of securities at August 31, 2003 by correspondence with the custodian, provide a
reasonable basis for our opinion.
PricewaterhouseCoopers LLP
New York, New York
October 15, 2003
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FLORIDA DAILY MUNICIPAL INCOME FUND
ADDITIONAL INFORMATION
(UNAUDITED)
================================================================================
Trustees and Officers Information
August 31, 2003+
- ------------------------ ------------- --------------- ----------------------------- ------------------------ ---------------
Number of Portfolios in Other
Position(s) Term of Office Principal Occupation(s) Fund Complex Directorships
Name, Address* Held with and Length of During Past Overseen by Trustee or held by
and Age Fund Time Served 5 Years Officer Trustee
- ------------------------ ------------- --------------- ----------------------------- ------------------------ ---------------
Disinterested Trustees:
- ------------------------ ------------- --------------- ----------------------------- ------------------------ ---------------
Dr. W. Giles Mellon, Trustee 1994 Professor Emeritus of Director/Trustee of N/A
Age 72 Business Administration ten other portfolios
in the Graduate School
of Management, Rutgers
University with which he
has been associated with
since 1966.
- ------------------------ ------------- --------------- ----------------------------- ------------------------ ---------------
Robert Straniere, Trustee 1994 Owner, Straniere Law Firm Director/Trustee of WPG Funds
Esq., Age 62 since 1980, NYS Assemblyman ten other portfolios Group
since 1981 and counsel at
Fisher, Fisher & Berger
since 1995.
- ------------------------ ------------- --------------- ----------------------------- ------------------------ ---------------
Dr. Yung Wong, Trustee 1994 Managing Director of Abacus Director/Trustee of N/A
Age 64 Associates, an investment ten other portfolios
firm, since 1996.
- ------------------------ ------------- --------------- ----------------------------- ------------------------ ---------------
<FN>
+ The Statement of Additional Information includes additional information
about Florida Daily Municipal Income Fund (the "Fund") trustees and is
available, without charge, upon request by calling the Fund's transfer
agent at (212) 830-5200.
* The address for each of the above trustees of the Fund is Reich & Tang
Asset Management, LLC, 600 Fifth Avenue, New York, NY 10020.
</FN>
- --------------------------------------------------------------------------------
FLORIDA DAILY MUNICIPAL INCOME FUND
ADDITIONAL INFORMATION (CONTINUED)
(UNAUDITED)
================================================================================
Trustees and Officers Information (continued)
August 31, 2003+
- ------------------------ -------------- --------------- --------------------------- ------------------------ ---------------
Number of Portfolios in Other
Position(s) Term of Office Principal Occupation(s) Fund Complex Directorships
Name, Address* Held with and Length of During Past Overseen by Trustee or held by
and Age Fund Time Served 5 Years Officer Trustee
- ------------------------ -------------- --------------- --------------------------- ------------------------ ---------------
Interested Trustees/Officers:
- ------------------------ -------------- --------------- --------------------------- ------------------------ ---------------
Steven W. Duff, President and 1994 Manager and President of Director/Trustee and/or N/A
Age 49 Trustee** Reich & Tang Asset Officer of fifteen
Management, LLC (RTAM, other portfolios
LLC), a registered
Investment Advisor.
Associated with RTAM, LLC
since 1994.
- ------------------------ -------------- --------------- --------------------------- ------------------------ ---------------
Richard De Sanctis, Treasurer and 1994 Executive Vice President, Officer of fifteen N/A
Age 46 Assistant CFO of RTAM, LLC. other portfolios
Secretary Associated with RTAM, LLC
since 1990.
- ------------------------ -------------- --------------- --------------------------- ------------------------ ---------------
Molly Flewharty, Vice President 1995 Senior Vice President of Officer of fifteen N/A
Age 52 RTAM, LLC. Associated with other portfolios
RTAM, LLC since 1977.
- ------------------------ -------------- --------------- --------------------------- ------------------------ ---------------
Rosanne Holtzer, Secretary and 1998 Senior Vice President of Officer of fifteen N/A
Age 39 Assistant RTAM, LLC. Associated with other portfolios
Treasurer RTAM, LLC since 1986.
- ------------------------ -------------- --------------- --------------------------- ------------------------ ---------------
Dana E. Messina, Vice President 1995 Executive Vice President of Officer of twelve N/A
Age 46 RTAM, LLC. Associated with other portfolios
RTAM, LLC since 1980.
- ------------------------ -------------- --------------- --------------------------- ------------------------ ---------------
<FN>
+ The Statement of Additional Information includes additional information
about Florida Daily Municipal Income Fund (the "Fund") trustees and is
available, without charge, upon request by calling the Fund's transfer
agent at (212) 830-5200.
* The address for each of the above trustees/officers of the Fund is Reich &
Tang Asset Management, LLC, 600 Fifth Avenue, New York, NY 10020.
** Steven W. Duff is deemed an interested person of the Fund due to his
affiliation with RTAM, LLC, the Fund's investment advisor.
</FN>
- --------------------------------------------------------------------------------
- -----------------------------------------------------
This report is submitted for the general information
of the shareholders of the Fund. It is not
authorized for distribution to prospective investors
in the Fund unless preceded or accompanied by an
effective prospectus, which includes information
regarding the Fund's objectives and policies,
experience of its management, marketability of
shares, and other information.
- ------------------------------------------------------
Florida Daily Municipal Income Fund
600 Fifth Avenue
New York, New York 10020
Manager
Reich & Tang Asset Management, LLC
600 Fifth Avenue
New York, New York 10020
Custodian
The Bank of New York
100 Church Street, 10th Floor
New York, New York 10286
Transfer Agent &
Dividend Disbursing Agent
Reich & Tang Services, Inc.
600 Fifth Avenue
New York, NY 10020
FL8/03A
- --------------------------------------------------------------------------------
FLORIDA
DAILY
MUNICIPAL
INCOME
FUND
Annual Report
August 31, 2003
- --------------------------------------------------------------------------------
ITEM 2: CODE OF ETHICS
The Registrant has adopted a Code of Ethics applicable to its Principal
Executive and Senior Financial Officers.
ITEM 3: AUDIT COMMITTEE FINANCIAL EXPERT
The Registrant's Board of Trustees has determined that the Registrant does not
have an audit committee financial expert serving on its audit committee. The
Board discussed that although none of the members qualified as audit committee
financial experts, the collective experience of the audit committee members,
including their long-standing service as audit committee members, was sufficient
to effectively carry out the role and obligations of the audit committee. The
Board also considered the nature of investment company financials, and the fact
that the audit committee was able to consult with the Registrant's independent
accountants and to seek outside advise, as they deemed appropriate.
ITEM 4: PRINCIPAL ACCOUNTANT FEES AND SERVICES
Not applicable at this time.
ITEM 5: AUDIT COMMITTEE OF LISTED REGISTRANTS
Not applicable.
ITEM 6: RESERVED
ITEM 7: DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES
Not applicable.
ITEM 8: RESERVED
ITEM 9: CONTROLS AND PROCEDURES
(a) The registrant's Principal Executive Officer and Principal Financial
Officer have evaluated the registrant's disclosure controls and
procedures within 90 days of this filing and have concluded that the
registrant's disclosure controls and procedures were effective in
ensuring that information required to be disclosed by the registrant
in this Form N-CSR was recorded, processed, summarized and reported on
a timely basis.
(b) There were no changes in the registrant's internal controls over
financial reporting that occurred during the registrant's second
fiscal half-year that have materially affected, or are reasonably
likely to affect, the registrant's internal controls over financial
reporting.
ITEM 10: EXHIBITS
(a)(1) Code of Ethics.
(a)(2) Certifications of Principal Executive Officer and Principal Financial
Officer, under Rule 30a-2 of the Investment Company Act of 1940.
(b) Certifications of Principal Executive Officer and Principal Financial
Officer, under Section 906 of the Sarbanes-Oxley Act of 2002, and 18
U.S.C. ss.1350.
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) Florida Daily Municipal Income Fund
By (Signature and Title)* /s/ Rosanne Holtzer
Rosanne Holtzer, Secretary
Date October 29, 2003
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By (Signature and Title)* /s/ Steven W. Duff
Steven W. Duff, Chief Executive Officer
Date October 29, 2003
By (Signature and Title)* /s/ Richard DeSanctis
Richard DeSanctis, Chief Financial Officer
Date October 29, 2003
* Print the name and title of each signing officer under his or her signature.