Item 1. Report to Shareholders
T. Rowe Price Prime Reserve Fund
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May 31, 2004
Certified Annual Report
This report is certified under the Sarbanes-Oxley Act of 2002, which requires
that public companies, including mutual funds, affirm that the information
provided in their annual and semiannual shareholder reports fully and fairly
represents their financial position.
T. Rowe Price Prime Reserve Fund
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Certified Annual Report
Performance Comparison
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This chart shows the value of a hypothetical $10,000 investment in the fund over
the past 10 fiscal year periods or since inception (for funds lacking 10-year
records). The result is compared with benchmarks, which may include a
broad-based market index and a peer group average or index. Market indexes do
not include expenses, which are deducted from fund returns as well as mutual
fund averages and indexes.
[Graphic Omitted]
PRIME RESERVE FUND
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As of 5/31/04
Prime Reserve Fund $14,780
Lipper Money Market Funds Average $14,568
Lipper Money Prime
Market Funds Reserve
Average Fund
5/94 $ 10,000 $ 10,000
5/95 10,472 10,485
5/96 11,006 11,035
5/97 11,538 11,577
5/98 12,120 12,175
5/99 12,688 12,761
5/00 13,328 13,427
5/01 14,073 14,208
5/02 14,371 14,559
5/03 14,504 14,706
5/04 14,568 14,780
Average Annual Compound Total Return
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Periods Ended 5/31/04 1 Year 5 Years 10 Years
Prime Reserve Fund 0.51% 2.98% 3.98%
Lipper Money Market
Funds Average 0.36 2.68 3.83
Returns do not reflect taxes that the shareholder may pay on fund distributions.
Past performance cannot guarantee future results.
T. Rowe Price Prime Reserve Fund
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Certified Annual Report
Dear Shareholder,
Reflecting very low money market rates, your fund had a positive return of 0.51%
during the 12 months ended May 31, 2004. It outperformed the Lipper average of
similarly managed funds during the period, as shown in the table on the previous
page, primarily because we emphasized higher-yielding money market securities
for most of the last year.
[Graphic Omitted]
INTEREST RATE LEVELS
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6-Month Treasury Bill
3-Month Treasury Bill
Federal Funds Target Rate
6-Month 3-Month Federal Funds
Treasury Bill Treasury Bill Target Rate
5/31/03 1.08% 1.10% 1.25%
6/03 0.96 0.85 1.00
7/03 1.01 0.94 1.00
8/03 1.04 0.97 1.00
9/03 1.00 0.94 1.00
10/03 1.03 0.95 1.00
11/03 1.03 0.93 1.00
12/03 1.01 0.92 1.00
1/04 0.99 0.91 1.00
2/04 1.00 0.94 1.00
3/04 0.99 0.94 1.00
4/04 1.15 0.96 1.00
5/31/04 1.38 1.06 1.00
As you know, the fund seeks preservation of capital, liquidity, and, consistent
with these, the highest possible current income by investing in a diversified
portfolio of high-quality, U.S. dollar-denominated money market securities. The
fund's average weighted maturity will not exceed 90 days, and we will not
purchase any security with a maturity longer than 13 months.
Portfolio Characteristics
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Periods Ended 5/31/03 5/31/04
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Price Per Share $ 1.00 $ 1.00
Dividend Yield
(7-Day Simple) * 0.62% 0.51%
Weighted Average
Maturity (days) 53 43
Weighted Average Quality ** First Tier First Tier
* Dividends earned for the last seven days of the period indicated are
annualized and divided by the fund's net asset value.
** All securities purchased in the money fund are rated in the two highest
categories (tiers) as established by the national rating agencies or, if
unrated, are deemed of comparable quality by T. Rowe Price.
Note: A money fund's yield more closely reflects its current earnings than the
total return.
As shown in the Portfolio Characteristics table, the fund's weighted average
maturity slipped from 53 days to 43 days during its fiscal year. Its simple
seven-day dividend yield
also declined from 0.62% to 0.51%. The fund's price per share remained steady at
$1.00, and its weighted average quality remained very high because we continued
to focus primarily on money market instruments with the highest credit quality.
We thank you for your continued support.
Respectfully submitted,
James S. Riepe
Chairman
June 15, 2004
T. Rowe Price Prime Reserve Fund
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Certified Annual Report
Financial Highlights For a share outstanding throughout each period
- --------------------------------------------------------------------------------
Year
Ended
5/31/04 5/31/03 5/31/02 5/31/01 5/31/00
NET ASSET VALUE
Beginning of
period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
Investment
activities
Net investment
income (loss) 0.005 0.010 0.024 0.057 0.051
Distributions
Net investment
income (0.005) (0.010) (0.024) (0.057) (0.051)
NET ASSET VALUE
End of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
---------------------------------------------------------
Ratios/Supplemental
Data
Total return^ 0.51% 1.01% 2.47% 5.82% 5.22%
Ratio of total
expenses to
average net assets 0.62% 0.64% 0.63% 0.59% 0.62%
Ratio of net
investment
income (loss) to
average net assets 0.51% 1.01% 2.44% 5.66% 5.11%
Net assets,
end of period
(in millions) $ 5,053 $ 5,652 $ 5,531 $ 5,758 $ 5,618
^ Total return reflects the rate that an investor would have earned on an
investment in the fund during each period, assuming reinvestment of all
distributions.
The accompanying notes are an integral part of these financial statements.
T. Rowe Price Prime Reserve Fund
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Certified Annual Report May 31, 2004
Portfolio of Investments (1) $ Par Value
- --------------------------------------------------------------------------------
(Amounts in 000s)
CERTIFICATES OF DEPOSIT - DOMESTIC * 3.6%
Fifth Third Bank Cincinnati,
1.075%, 9/20/04 24,500 24,501
First Tennessee Bank, 1.04%, 6/24/04 19,750 19,750
Mercantile Safe Deposit & Trust
1.10%, 8/4/04 33,700 33,700
1.15%, 7/29/04 350 350
Wells Fargo Bank, 1.03%,
6/14 - 6/17/04 74,000 74,000
Wilmington Trust, 1.10%, 9/22/04 28,500 28,500
Total Certificates of Deposit - Domestic *
(Cost $180,801) 180,801
CERTIFICATES OF DEPOSIT - EURODOLLAR ^ 7.9%
Barclays Bank
1.10%, 8/4/04 25,000 25,000
1.11%, 9/7/04 15,000 15,001
1.14%, 12/9/04 44,000 44,005
Credit Agricole Indosuez,
1.27%, 12/31/04 50,000 50,020
HBOS Treasury Services,
1.10%, 7/15/04 10,000 10,001
KBC Bank, 1.12%, 8/4/04 50,000 50,001
National Australia Bank
1.28%, 8/31/04 50,000 50,000
1.40%, 9/7/04 50,000 50,000
Royal Bank of Scotland
1.045%, 6/16/04 25,000 25,000
1.12%, 8/23/04 28,000 28,000
Societe Generale, 1.10%, 7/15/04 50,000 50,001
Total Certificates of Deposit - Eurodollar ^
(Cost $397,029) 397,029
CERTIFICATES OF DEPOSIT - YANKEE ++ 9.3%
Abbey National Treasury Services,
1.42%, 10/21/04 25,000 24,999
BNP Paribas, 1.39%, 8/5/04 4,000 4,002
Canadian Imperial Bank of Commerce,
1.04%, 6/8/04 25,000 25,000
Credit Suisse First Boston,
1.10%, 8/4/04 50,000 50,000
Fortis Bank, 1.12%, 6/28/04 74,700 74,700
HBOS Treasury Services, 1.035%, 6/30/04 15,000 15,000
Lloyds Bank, 1.04%, 6/30/04 60,000 60,000
Natexis Banques Populaires, 1.10%, 8/5/04 25,000 25,000
Rabobank Nederland
1.028%, 6/9/04 49,500 49,500
1.23%, 10/1/04 24,900 24,890
Royal Bank of Scotland,
1.34%, 9/30/04 35,000 34,993
Toronto-Dominion Bank
1.03%, 6/2 - 6/17/04 17,000 17,000
1.38%, 8/27/04 24,825 24,824
UBS
1.025%, 6/28/04 1,000 1,000
1.065%, 7/6/04 15,000 15,000
1.35%, 10/20/04 25,000 25,000
Total Certificates of Deposit - Yankee ++
(Cost $470,908) 470,908
COMMERCIAL PAPER 17.2%
ANZ
1.05%, 6/10/04 1,500 1,500
1.053%, 7/6/04 4,000 3,996
1.054%, 6/25/04 1,200 1,199
1.10%, 7/7 - 7/8/04 2,400 2,397
1.15%, 7/8 - 7/19/04 29,200 29,156
CBA Finance
1.03%, 6/8 - 6/11/04 28,375 28,369
1.033%, 6/9 - 6/10/04 6,700 6,698
1.042%, 6/10 - 6/11/04 6,400 6,398
1.08%, 7/2 - 7/7/04 5,000 4,995
1.082%, 7/2/04 818 817
1.15%, 7/7 - 7/15/04 5,300 5,294
Ciesco
1.041%, 6/17 - 6/18/04 4,995 4,993
1.12%, 7/16/04 14,810 14,789
Citicorp, 1.05%, 6/1/04 25,000 25,000
Citigroup Global Markets Holdings
1.03%, 6/22/04 5,400 5,397
1.032%, 6/4/04 20,000 19,998
Credit Suisse First Boston
1.04%, 6/9/04 15,000 14,996
1.042%, 6/1/04 485 485
Danske Corporation
1.041%, 6/18/04 1,100 1,099
1.08%, 7/9/04 1,900 1,898
1.106%, 8/6/04 1,625 1,622
1.112%, 7/12/04 24,000 23,970
1.116%, 7/30/04 16,000 15,971
Dexia, 1.032%, 6/8/04 1,633 1,633
European Investment Bank, 1.12%, 7/16/04 2,850 2,846
FCAR Owner Trust, 1.105%, 7/12/04 50,000 49,937
K2 (USA)
1.03%, 6/15/04 23,500 23,491
1.032%, 6/7/04 6,040 6,039
1.033%, 6/18/04 6,800 6,797
1.043%, 6/22/04 7,000 6,996
1.05%, 6/10 - 7/15/04 25,565 25,551
1.051%, 6/15/04 9,359 9,355
1.054%, 7/15/04 7,000 6,991
1.074%, 6/1/04 21,000 21,000
1.08%, 7/1/04 8,500 8,492
1.10%, 8/6/04 15,000 14,970
1.106%, 8/20/04 5,600 5,586
Links Finance
144A, 1.03%, 6/8/04 39,750 39,742
144A, 1.106%, 8/10/04 25,000 24,947
Merrill Lynch, 1.106%, 8/9/04 26,300 26,244
Morgan Stanley Dean Witter
1.03%, 6/3/04 22,000 21,999
1.04%, 6/18/04 30,000 29,985
National Rural Utilities Coop. Fin.
1.04%, 6/14 - 6/17/04 49,302 49,283
1.15%, 7/8/04 23,427 23,399
Nationwide Building Society,
1.03%, 6/8/04 1,266 1,266
New Center Asset Trust
1.05%, 6/7/04 21,750 21,746
1.11%, 7/7/04 20,000 19,978
New York State Power Authority
1.042%, 6/1/04 10,581 10,581
1.05%, 6/1/04 1,090 1,090
1.13%, 7/20/04 8,396 8,383
Nordea North America,
1.033%, 6/21 - 6/24/04 29,000 28,981
Royal Bank of Scotland,
1.032%, 6/28/04 3,100 3,098
San Paolo IMI U.S. Financial,
1.12%, 7/1/04 14,900 14,886
Stanford University
1.053%, 6/3/04 4,000 4,000
1.084%, 6/9/04 8,000 7,998
Svenska Handlesbanken,
1.15%, 7/21/04 1,300 1,298
U.B.S. Americas, 1.04%, 6/16/04 2,508 2,507
UBS Finance
1.02%, 6/23/04 1,048 1,047
1.032%, 6/7 - 6/28/04 14,081 14,073
1.033%, 6/23/04 1,822 1,821
1.04%, 6/3 - 6/16/04 24,372 24,365
1.043%, 7/1/04 13,904 13,892
1.05%, 6/23 - 6/28/04 5,371 5,367
1.052%, 6/24 - 6/28/04 2,400 2,398
1.06%, 7/6/04 3,300 3,297
1.10%, 7/1/04 1,500 1,499
Westpac Capital, 1.04%, 6/29/04 3,900 3,897
Westpac Trust Securities
1.03%, 6/24/04 1,100 1,099
1.033%, 6/24/04 3,700 3,697
1.04%, 6/3/04 2,800 2,800
1.05%, 6/4/04 3,500 3,500
Yale University
1.10%, 7/6/04 24,000 23,974
1.11%, 8/3/04 1,500 1,497
1.12%, 8/2/04 10,000 9,981
Total Commercial Paper (Cost $870,336) 870,336
COMMERCIAL PAPER - 4(2) 37.3%
Alliance & Leicester
1.033%, 6/15/04 18,535 18,528
1.04%, 6/8/04 15,000 14,997
Alpine Securitization
1.033%, 6/11/04 3,000 2,999
1.04%, 6/2 - 6/16/04 48,616 48,603
ASB Bank
1.05%, 7/7/04 20,000 19,979
1.096%, 7/20/04 25,000 24,963
1.10%, 7/29/04 6,000 5,989
1.12%, 7/14/04 7,000 6,991
Atlantic Asset Securitization
1.03%, 6/11/04 3,357 3,356
1.04%, 6/11/04 6,473 6,471
1.05%, 6/7/04 7,000 6,999
1.051%, 6/4/04 15,000 14,999
BASF, 1.042%, 6/24/04 30,000 29,980
Cargill, 1.03%, 6/8/04 3,228 3,227
CDC Commercial Paper,
1.048%, 7/7 - 7/8/4 39,750 39,708
Ciesco
1.10%, 7/12/04 640 639
1.12%, 7/12/04 3,758 3,753
Citibank Credit Card Issuance Trust
1.05%, 6/22/04 3,000 2,998
1.13%, 7/15/04 3,750 3,745
CRC Funding
1.03%, 6/10/04 8,800 8,798
1.032%, 6/11/04 16,400 16,395
1.04%, 6/21 - 6/25/04 29,688 29,670
1.05%, 6/23 - 6/25/04 10,125 10,119
1.07%, 7/6/04 2,500 2,497
1.10%, 7/12/04 69,700 69,613
1.15%, 7/21/04 9,750 9,734
Delaware Funding
1.04%, 6/22/04 32,064 32,045
1.042%, 6/9/04 4,383 4,382
1.05%, 6/2 - 6/22/04 3,191 3,190
DEPFA Bank
1.05%, 6/29/04 16,200 16,187
1.059%, 6/23/04 7,535 7,530
1.086%, 7/20/04 1,750 1,748
1.10%, 7/20/04 550 549
Discover Card Master Trust
1.04%, 6/18/04 3,000 2,998
1.05%, 6/25/04 26,000 25,982
1.09%, 7/6/04 48,000 47,949
Fairway Finance
1.04%, 6/8 - 6/18/04 42,696 42,682
1.05%, 6/2/04 1,017 1,017
1.051%, 6/14/04 4,775 4,773
1.06%, 6/14 - 9/15/04 4,275 4,264
1.065%, 9/8/04 27,001 26,922
1.076%, 9/15/04 16,925 16,872
1.10%, 7/8/04 1,635 1,633
1.102%, 7/2/04 7,634 7,627
1.116%, 8/6/04 7,856 7,840
Falcon Asset Securitization
1.033%, 6/15/04 40,659 40,643
1.04%, 6/10 - 6/11/04 20,800 20,794
1.041%, 6/8/04 24,600 24,595
Ford Credit Floorplan Master Owner Trust
1.062%, 6/18/04 7,750 7,746
1.11%, 8/2/04 40,000 39,924
Gannett, 1.05%, 6/2/04 2,935 2,935
General Electric Capital
1.03%, 6/22/04 5,677 5,674
1.08%, 7/7/04 4,350 4,345
1.10%, 7/8/04 1,000 999
Grampian Funding
1.042%, 6/8/04 29,700 29,694
1.043%, 7/2/04 3,500 3,497
1.053%, 6/2/04 13,400 13,400
KFW International Finance
1.10%, 8/9 - 9/7/04 39,750 39,657
1.184%, 9/10/04 50,000 49,836
1.317%, 10/6/04 49,850 49,621
Kitty Hawk Funding,
1.04%, 6/18/04 30,000 29,985
MassMutual Funding
1.03%, 6/2 - 6/3/04 8,090 8,089
1.05%, 6/22/04 380 380
MBNA Master Credit Card Trust II
1.10%, 7/29/04 49,500 49,412
1.13%, 7/13/04 76,955 76,854
Nationwide Life Insurance,
1.103%, 8/10/04 45,000 44,904
Nestle Capital, 1.10%, 9/10/04 4,853 4,838
Old Line Funding
1.032%, 6/7/04 43,079 43,072
1.04%, 6/23/04 35,790 35,767
1.041%, 6/7/04 2,999 2,998
1.05%, 6/4 - 6/16/04 65,449 65,431
1.09%, 7/6/04 27,198 27,169
1.10%, 7/6 - 7/7/04 2,230 2,228
Park Avenue Receivables
1.04%, 6/11/04 7,696 7,694
1.041%, 6/3 - 6/9/04 8,947 8,946
Pfizer, 1.03%, 6/7/04 1,140 1,140
Preferred Receivables Funding
1.033%, 6/21/04 31,404 31,386
1.04%, 6/7 - 6/18/04 66,788 66,770
1.05%, 6/21/04 25,524 25,509
1.053%, 6/1/04 20,000 20,000
Rio Tinto
1.03%, 6/4/04 39,528 39,525
1.04%, 6/3/04 28,023 28,021
Scotiabanc, 1.052%, 6/30/04 16,000 15,986
Sigma Finance
1.03%, 6/3/04 10,000 9,999
1.053%, 6/2/04 7,000 7,000
1.111%, 8/18/04 25,100 25,040
Southern Company, 1.03%, 6/22/04 9,900 9,894
Stadshypotek
1.03%, 6/4/04 3,700 3,699
1.04%, 6/4/04 2,600 2,600
Sysco, 1.05%, 6/1/04 1,374 1,374
Tulip Funding
1.04%, 6/11/04 36,500 36,490
1.06%, 6/30/04 14,000 13,988
Variable Funding Capital,
1.052%, 6/15/04 42,500 42,483
Wal-Mart Funding, 1.07%, 6/28/04 8,229 8,222
Wal-Mart Stores, 1.10%, 8/17/04 11,285 11,258
Yorktown Capital
1.03%, 6/14 - 6/17/04 34,348 34,332
1.033%, 6/17/04 4,798 4,796
1.04%, 6/11 - 6/18/04 40,479 40,461
1.05%, 6/10 - 6/22/04 3,538 3,537
Total Commercial Paper - 4(2)
(Cost $1,886,577) 1,886,577
FUNDING AGREEMENTS 3.0%
Allstate Life Insurance
VR, 1.25 %, 6/1/05, !! 25,000 25,000
VR, 1.32%, 6/1/05, !! 25,000 25,000
GE Life & Annuity, VR,
1.21%, 1/12/05 50,000 50,000
New York Life Insurance, VR,
1.20%, 12/10/04 30,000 30,000
Security Life of Denver,
1.15%, 6/24/04 15,000 15,000
Transamerica Occidential Life, VR,
1.25%, 6/28/05 5,000 5,000
Total Funding Agreements (Cost $150,000) 150,000
MEDIUM-TERM NOTES 4.7%
Abbey National First Capital,
8.20%, 10/15/04 18,330 18,803
AIG Sunamerica, 6.25%, 6/2/04 16,919 16,921
Credit Suisse First Boston,
1.59%, 1/14/05 1,700 1,705
First Union, 7.10%, 8/15/04 19,900 20,132
GE Capital
VR, 1.18%, 6/17/05 14,900 14,900
VR, 1.18%, 7/8/05 23,900 23,900
Goldman Sachs, VR, 144A,
1.17%, 6/1/05 49,600 49,600
International Lease Finance,
5.40%, 6/1/04 10,000 10,000
Total, 6.875%, 6/2/04 4,000 4,000
Wal-Mart Stores
5.199%, 6/1/04 73,000 73,000
6.55%, 8/10/04 2,200 2,223
Total Medium-Term Notes
(Cost $235,184) 235,184
MUNICIPAL SECURITIES 12.6%
Broward County, TECP, 1.12%, 6/4/04 22,000 22,000
California, RAN, 2.00%, 6/16/04 11,500 11,503
California Dept. of Water Resources
VRDN (Currently 1.07%) 17,500 17,500
VRDN (Currently 1.10%) 25,700 25,700
California HFA
VRDN (Currently 1.05%) 25,000 25,000
Sisters of Charity of Leavenworth,
VRDN (Currently 1.06%) 22,500 22,500
California Housing Finance Agency
VRDN (Currently 1.12%) # 16,300 16,300
Detroit Water Supply System, VRDN
(Currently 1.08%)(FGIC Insured) 6,800 6,800
District of Columbia
VRDN (Currently 1.02%)
(FSA Insured) 25,700 25,700
Smithsonian Institution, VRDN
(Currently 1.05%) 30,100 30,100
Gulf Coast IDA, BP Amoco, VRDN
(Currently 1.13%) # 4,600 4,600
Harris County Health Fac. Dev. Corp.,
Methodist Hospital
VRDN (Currently 1.08%) 6,500 6,500
Illinois, VRDN (Currently 1.08%) 12,500 12,500
Illinois EFA, Univ. of Chicago, VRDN
(Currently 1.05%) 24,000 24,000
Los Angeles Dept. Water & Power
VRDN (Currently 1.07%) 15,000 15,000
VRDN (Currently 1.07%) 22,210 22,210
Maryland HHEFA, VRDN
(Currently 1.06%) 12,050 12,050
Michigan Hosp. Fin. Auth.,
Trinity Health Corp.
VRDN (Currently 1.07%) (AMBAC Insured) 29,175 29,175
Murray City, IHC Health Services
VRDN (Currently 1.06%) 10,000 10,000
New Jersey Turnpike Auth.
VRDN (Currently 1.02%) (FGIC Insured) 11,200 11,200
New York, VRDN (Currently 1.07%) 6,000 6,000
New York City Housing Dev. Corp,
Multi-Family Housing
VRDN (Currently 1.08%) # 15,100 15,100
New York City Housing Dev. Corp.,
Multi-Family Housing
VRDN (Currently 1.08%) (FNMA Insured) # 14,200 14,200
New York City Municipal Water Fin. Auth.
VRDN (Currently 1.07%) 7,350 7,350
New York Housing Fin. Agency
VRDN (Currently 1.06%) (FNMA Insured) # 29,900 29,900
VRDN (Currently 1.06%) Federal Home Loan
Mortgage Corp. Multi-Family Housing, # 20,500 20,500
VRDN (Currently 1.06%) (FNMA Insured) 18,400 18,400
VRDN (Currently 1.10%) (FNMA Insured) 15,000 15,000
Pennsylvania Higher Ed. Assistance Agency
VRDN (Currently 1.09%) (AMBAC Insured) # 21,000 21,000
St. Charles Parish PCR, Shell Oil, VRDN
(Currently 1.13%) 2,200 2,200
Texas, Veterans, VRDN (Currently 1.09%) 9,000 9,000
Texas Dept. of Housing & Community Affairs,
Financial Security Assurance,
Single Family Housing,
VRDN (Currently 1.09%) # 34,000 34,000
Texas Turnpike Auth., Central Texas
VRDN (Currently 1.02%) (AMBAC Insured) 29,420 29,420
Triborough Bridge & Tunnel Auth.,
Financial Security Assurance
VRDN (Currently 1.03%) 16,400 16,400
VRDN (Currently 1.05%) 8,000 8,000
Utah Board of Regents, Univ. of Utah
VRDN (Currently 1.08%) 11,120 11,120
Valdez Marine, BP Pipeline, VRDN
(Currently 1.10%) 1,200 1,200
Washington Suburban Sanitary Dist.
VRDN (Currently 1.05%) 5,400 5,400
VRDN (Currently 1.05%) 20,670 20,670
Total Municipal Securities
(Cost $635,198) 635,198
U.S. GOVERNMENT AGENCY OBLIGATIONS (+/-) 3.1%
Federal Home Loan Bank
1.00%, 7/20/04 49,850 49,850
1.55%, 5/4/05 39,800 39,800
Federal Home Loan Mortage,
1.15%, 8/16/04 20,000 19,951
Federal National Mortgage Assn.,
VR, 1.219%, 2/14/05 49,750 49,750
Total U.S. Government Agency Obligations (+/-)
(Cost $159,351) 159,351
Total Investments in Securities
98.7% of Net Assets (Cost $4,985,384) $ 4,985,384
--------------------
(1) Denominated in U.S. dollar unless otherwise noted
# Interest subject to alternative minimum tax
* Domestic certificates of deposit are issued by domestic branches of U.S.
banks
(+/-)The issuer is a publicly-traded company that operates under a
congressional charter; its securities are neither issued nor guaranteed by
the U.S. government.
^ Eurodollar certificates of deposit are issued by foreign branches of U.S.
or foreign banks
++ Yankee certificates of deposit are issued by U.S. branches of foreign banks
!! Security contains restrictions as to public resale pursuant to the
Securities Act of 1933 and related rules - total value of such securities
at period-end amounts to $50,000 and represents 1.0% of net assets
144A Security was purchased pursuant to Rule 144A under the Securities Act of
1933 and may be resold in transactions exempt from registration only to
qualified institutional buyers - total value of such securities at
period-end amounts to $114,289 and represents 2.3% of net assets
4(2) Commercial paper exempt from registration under Section 4(2) of the
Securities Act of 1933 and may be resold in transactions exempt from
registration only to dealers in that program or other "accredited
investors" - total value of such securities at period-end amounts to
$1,886,577 and represents 37.3% of net assets
AMBAC AMBAC Assurance Corp.
EFA Educational Facility Authority
FGIC Financial Guaranty Insurance Company
FNMA Federal National Mortgage Association
FSA Financial Security Assurance Inc.
HFA Health Facility Authority
HHEFA Health & Higher Educational Facility Authority
IDA Industrial Development Authority/Agency
PCR Pollution Control Revenue
RAN Revenue Anticipation Note
TECP Tax-Exempt Commercial Paper
VR Variable Rate
VRDN Variable-Rate Demand Note
The accompanying notes are an integral part of these financial statements.
T. Rowe Price Prime Reserve Fund
- --------------------------------------------------------------------------------
Certified Annual Report May 31, 2004
Statement of Assets and Liabilities
- --------------------------------------------------------------------------------
(Amounts in $000s except shares and per share amounts)
Assets
Investments in securities, at value (cost $4,985,384) $ 4,985,384
Other assets 87,531
Total assets 5,072,915
Liabilities
Total liabilities 20,069
NET ASSETS $ 5,052,846
-------------
Net Assets Consist of:
Undistributed net investment income (loss) $ 736
Paid-in-capital applicable to 5,052,758,622 shares of
$0.01 par value capital stock outstanding;
15,000,000,000 shares authorized 5,052,110
NET ASSETS $ 5,052,846
-------------
NET ASSET VALUE PER SHARE $ 1.00
-------------
The accompanying notes are an integral part of these financial statements.
T. Rowe Price Prime Reserve Fund
- --------------------------------------------------------------------------------
Certified Annual Report
Statement of Operations
- --------------------------------------------------------------------------------
($ 000s)
Year
Ended
5/31/04
Investment Income (Loss)
Interest Income $ 59,696
Expenses
Investment management 19,470
Shareholder servicing 12,271
Prospectus and shareholder reports 468
Custody and accounting 386
Registration 155
Legal and audit 30
Directors 21
Miscellaneous 58
Total expenses 32,859
Expenses paid indirectly (2)
Net expenses 32,857
Net investment income (loss) 26,839
Realized and Unrealized Gain (Loss)
Net realized gain (loss) 86
INCREASE (DECREASE) IN NET
ASSETS FROM OPERATIONS $ 26,925
--------------------
The accompanying notes are an integral part of these financial statements.
T. Rowe Price Prime Reserve Fund
- --------------------------------------------------------------------------------
Certified Annual Report
Statement of Changes in Net Assets
- --------------------------------------------------------------------------------
($ 000s)
Year
Ended
5/31/04 5/31/03
Increase (Decrease) in Net Assets
Operations
Net investment income (loss) $ 26,839 $ 57,566
Net realized gain (loss) 86 36
Increase (decrease) in net assets
from operations 26,925 57,602
Distributions to shareholders
Net investment income (26,839) (57,565)
Capital share transactions *
Shares sold
Prime Reserve shares 4,011,213 4,175,302
Prime Reserve - PLUS Class shares - 24,412
Distributions reinvested
Prime Reserve shares 26,141 55,233
Prime Reserve - PLUS Class shares - 515
Shares redeemed
Prime Reserve shares (4,636,758) (4,196,132)
Prime Reserve - PLUS Class shares - (20,571)
Shares transferred in connection with
Plus Class closure
Prime Reserve shares - 86,608
Prime Reserve - PLUS Class shares - (86,608)
Increase (decrease) in net assets
from capital share transactions (599,404) 38,759
Net Assets
Increase (decrease) during period (599,318) 38,796
Beginning of period 5,652,164 5,613,368
End of period $ 5,052,846 $ 5,652,164
------------------------------------
(Including undistributed net investment income of
$736 at 5/31/04 and $736 at 5/31/03)
* Capital shares transactions at net asset value of $1.00 per share.
The accompanying notes are an integral part of these financial statements.
T. Rowe Price Prime Reserve Fund
- --------------------------------------------------------------------------------
Certified Annual Report May 31, 2004
Notes to Financial Statements
- --------------------------------------------------------------------------------
NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES
T. Rowe Price Prime Reserve Fund, Inc. (the fund) is registered under the
Investment Company Act of 1940 (the 1940 Act) as a diversified, open-end
management investment company and commenced operations on January 26, 1976. The
fund seeks preservation of capital, liquidity, and, consistent with these, the
highest possible current income.
From November 1, 1998 through November 25, 2002, the fund also offered a second
class of shares. The T. Rowe Price Prime Reserve-PLUS Class (PLUS Class)
provided expanded shareholder services, the cost of which was borne by its
shareholders. Each class had exclusive voting rights on matters related solely
to that class, separate voting rights on matters which related to both classes,
and, in all other respects, the same rights and obligations as the other class.
On November 25, 2002, all outstanding shares of the PLUS Class were transferred
into the Prime Reserve Fund class at their value on that date, and the PLUS
class was closed. The transfer was nontaxable to investors.
The accompanying financial statements were prepared in accordance with
accounting principles generally accepted in the United States of America, which
require the use of estimates made by fund management.
Valuation
Securities are valued at amortized cost. Assets and liabilities for which such
valuation procedures are deemed not to reflect fair value are stated at fair
value as determined in good faith by the T. Rowe Price Valuation Committee,
established by the fund's Board of Directors.
Credits
The fund earns credits on temporarily uninvested cash balances at the custodian
that reduce the fund's custody charges. Custody expense in the accompanying
financial statements is presented before reduction for credits, which are
reflected as expenses paid indirectly.
Investment Transactions, Investment Income, and Distributions
Income and expenses are recorded on the accrual basis. Premiums and discounts on
debt securities are amortized for financial reporting purposes. Investment
transactions are accounted for on the trade date. Realized gains and losses are
reported on the identified cost basis. Distributions to shareholders are
recorded on the ex-dividend date. Income distributions are declared on a daily
basis and paid monthly.
Other
In the normal course of business, the fund enters into contracts that provide
general indemnifications. The fund's maximum exposure under these arrangements
is dependent on claims that may be made against the fund in the future and,
therefore, cannot be estimated; however, based on experience, the risk of
material loss from such claims is considered remote.
NOTE 2 - FEDERAL INCOME TAXES
No provision for federal income taxes is required since the fund intends to
continue to qualify as a regulated investment company under Subchapter M of the
Internal Revenue Code and distribute to shareholders all of its taxable income
and gains. Federal income tax regulations differ from generally accepted
accounting principles; therefore, distributions determined in accordance with
tax regulations may differ significantly in amount or character from net
investment income and realized gains for financial reporting purposes. Financial
reporting records are adjusted for permanent book/tax differences to reflect tax
character. Financial records are not adjusted for temporary differences.
Distributions during the year ended May 31, 2004 totaled $26,839,000 and were
characterized as ordinary income for tax purposes. At May 31, 2004, the
tax-basis components of net assets were as follows:
Undistributed ordinary income $ 736,000
Paid-in capital 5,052,110,000
Net assets $ 5,052,846,000
--------------------
The fund intends to retain realized gains to the extent of available capital
loss carryforwards for federal income tax purposes. During the fiscal year ended
May 31, 2004, the fund utilized $22,000 of capital loss carryforwards.
For the year ended May 31, 2004, the fund recorded the following permanent
reclassifications to reflect tax character. Reclassifications to paid-in capital
relate primarily to a tax practice that treats a portion of the proceeds from
each redemption of capital shares as a distribution of taxable net investment
income and/or realized capital gain. Results of operations and net assets were
not affected by these reclassifications.
Undistributed net realized gain $ (64,000)
Paid-in capital 64,000
At May 31, 2004, the cost of investments for federal income tax purposes was
$4,985,384,000.
NOTE 3- RELATED PARTY TRANSACTIONS
The fund is managed by T. Rowe Price Associates, Inc. (the manager or Price
Associates), a wholly owned subsidiary of T. Rowe Price Group, Inc. The
investment management agreement between the fund and the manager provides for an
annual investment management fee, which is computed daily and paid monthly. The
fee consists of an individual fund fee, equal to 0.05 % of the fund's average
daily net assets, and the fund's pro-rata share of a group fee. The group fee is
calculated based on the combined net assets of certain mutual funds sponsored by
Price Associates (the group) applied to a graduated fee schedule, with rates
ranging from 0.48% for the first $1 billion of assets to 0.295% for assets in
excess of $120 billion. The fund's portion of the group fee is determined by the
ratio of its average daily net assets to those of the group. At May 31, 2004,
the effective annual group fee rate was 0.32%, and investment management fee
payable totaled $1,559,000.
In addition, the fund has entered into service agreements with Price Associates
and two wholly owned subsidiaries of Price Associates (collectively, Price).
Price Associates computes the daily share price and maintains the financial
records of the fund. T. Rowe Price Services, Inc., provides shareholder and
administrative services in its capacity as the fund's transfer and dividend
disbursing agent. T. Rowe Price Retirement Plan Services, Inc., provides
subaccounting and recordkeeping services for certain retirement accounts
invested in the fund. Expenses incurred pursuant to these service agreements
totaled $8,434,000 for the year ended May 31, 2004, of which $745,000 was
payable at period-end.
T. Rowe Price Prime Reserve Fund
- --------------------------------------------------------------------------------
Certified Annual Report
Report of Independent Registered Public Accounting Firm
- --------------------------------------------------------------------------------
To the Board of Directors and Shareholders of
T. Rowe Price Prime Reserve Fund, Inc.
In our opinion, the accompanying statement of assets and liabilities, including
the portfolio of investments, 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 T. Rowe Price Prime Reserve Fund
(the "Fund") at May 31, 2004, the results of its operations, the changes in its
net assets and the financial highlights for each of the fiscal periods
presented, 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 the standards of the Public Company
Accounting Oversight Board (United States), 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 May 31,
2004 by correspondence with the custodian and brokers, provide a reasonable
basis for our opinion.
PricewaterhouseCoopers LLP
Baltimore, Maryland
June 22, 2004
T. Rowe Price Prime Reserve Fund
- --------------------------------------------------------------------------------
Certified Annual Report
Tax Information (Unaudited) for the Tax Year Ended 5/31/04
- --------------------------------------------------------------------------------
We are providing this information as required by the Internal Revenue Code. The
amounts shown may differ from those elsewhere in this report because of
differences between tax and financial reporting requirements.
The fund's distributions to shareholders included $64,000 from short-term
capital gains.
Information on Proxy Voting
- --------------------------------------------------------------------------------
A description of the policies and procedures that the T. Rowe Price Prime
Reserve Fund uses to determine how to vote proxies relating to portfolio
securities is available, without charge, upon request by calling 1-800-225-5132.
It also appears in the fund's Statement of Additional Information (Form 485B),
which can be found on the SEC's Web site, www.sec.gov.
T. Rowe Price Prime Reserve Fund
- --------------------------------------------------------------------------------
Certified Annual Report
About the Fund's Directors and Officers
- --------------------------------------------------------------------------------
Your fund is governed by a Board of Directors that meets regularly to review
investments, performance, expenses, and other business matters, and is
responsible for protecting the interests of shareholders. The majority of the
fund's directors are independent of T. Rowe Price Associates, Inc. (T. Rowe
Price); "inside" directors are officers of T. Rowe Price. The Board of Directors
elects the fund's officers, who are listed in the final table. The business
address of each director and officer is 100 East Pratt Street, Baltimore, MD
21202. The Statement of Additional Information includes additional information
about the fund directors and is available without charge by calling a T. Rowe
Price representative at 1-800-225-5132.
Independent Directors
Name
(Year of Birth) Principal Occupation(s) During Past 5 Years and
Year Elected * Directorships of Other Public Companies
Anthony W. Deering Director, Chairman of the Board, and Chief
(1945) Executive Officer, The Rouse Company, real
1979 estate developers; Director, Mercantile Bank
(4/03 to present)
Donald W. Dick, Jr. Principal, EuroCapital Advisors, LLC, an
(1943) acquisition and management advisory firm
2001
David K. Fagin Director, Golden Star Resources Ltd., Canyon
(1938) Resources Corp. (5/00 to present), and
2001 Pacific Rim Mining Corp. (2/02 to present);
Chairman and President, Nye Corp.
Karen N. Horn Managing Director and President, Global Private
(1943) Client Services, Marsh Inc. (1999-2003);
2003 Managing Director and Head of International
Private Banking, Bankers Trust (1996-1999);
Director, Eli Lilly and Company and Georgia
Pacific
F. Pierce Linaweaver President, F. Pierce Linaweaver & Associates,
(1934) Inc., consulting environmental and civil engineers
1980
John G. Schreiber Owner/President, Centaur Capital Partners, Inc.,
(1946) a real estate investment company; Partner,
1992 Blackstone Real Estate Advisors, L.P.; Director,
AMLI Residential Properties Trust and The Rouse
Company, real estate developers
* Each independent director oversees 111 T. Rowe Price portfolios and serves
until retirement, resignation, or election of a successor.
Inside Directors
Name
(Year of Birth)
Year Elected *
[Number of T. Rowe Price Principal Occupation(s) During Past 5 Years and
Portfolios Overseen] Directorships of Other Public Companies
Mary J. Miller, CFA Vice President, T. Rowe Price and
(1955) T. Rowe Price Group, Inc.;
2004 Vice President, Prime Reserve Fund
[37]
James S. Riepe Director and Vice President, T. Rowe Price;
(1943) Vice Chairman of the Board, Director, and Vice
1994 President, T. Rowe Price Group, Inc.; Chairman of
[111] the Board and Director, T. Rowe Price Global
Asset Management Limited, T. Rowe Price Global
Investment Services Limited, T. Rowe Price
Investment Services, Inc., T. Rowe Price
Retirement Plan Services, Inc., and T. Rowe Price
Services, Inc.; Chairman of the Board, Director,
President, and Trust Officer, T. Rowe Price Trust
Company; Director, T. Rowe Price International,
Inc.; Director, The Nasdaq Stock Market, Inc.;
Chairman of the Board, Prime Reserve Fund
* Each inside director serves until retirement, resignation, or election of a
successor.
Officers
Name (Year of Birth)
Title and Fund(s) Served Principal Occupation(s)
Stephen V. Booth, CPA (1961) Vice President, T. Rowe Price, T. Rowe
Vice President, Prime Reserve Fund Price Group, Inc., and T. Rowe Price
Trust Company
Steven G. Brooks, CFA (1954) Vice President, T. Rowe Price and
Vice President, Prime Reserve Fund T. Rowe Price Group, Inc.
Brian E. Burns (1960) Assistant Vice President, T. Rowe Price
Vice President, Prime Reserve Fund
Joseph A. Carrier (1960) Vice President, T. Rowe Price, T. Rowe
Treasurer, Prime Reserve Fund Price Group, Inc., T. Rowe Price
Investment Services, Inc., and T. Rowe
Price Trust Company
Patrick S. Cassidy, CFA (1964) Vice President, T. Rowe Price and
Vice President, Prime Reserve Fund T. Rowe Price Group, Inc.
Roger L. Fiery III, CPA (1959) Vice President, T. Rowe Price, T. Rowe
Vice President, Prime Reserve Fund Price Group, Inc., T. Rowe Price
International, Inc., and T. Rowe Price
Trust Company
Unless otherwise noted, officers have been employees of T. Rowe Price or T. Rowe
Price International for at least five years.
Officers (continued)
Name (Year of Birth)
Title and Fund(s) Served Principal Occupation(s)
Mark S. Finn, CPA, CFA (1963) Vice President, T. Rowe Price
Vice President, Prime Reserve Fund and T. Rowe Price Group, Inc.
Alisa Fiumara, CFA (1974) Assistant Vice President, T. Rowe Price;
Vice President, Prime Reserve Fund formerly Associate Analyst, Legg Mason
(to 2000)
Gregory S. Golczewski (1966) Vice President, T. Rowe Price and
Vice President, Prime Reserve Fund T. Rowe Price Trust Company
Terri L. Hett (1959) Employee, T. Rowe Price
Assistant Vice President, Prime
Reserve Fund
Henry H. Hopkins (1942) Director and Vice President, T. Rowe
Vice President, Prime Reserve Fund Price Investment Services, Inc., T. Rowe
Price Services, Inc., and T. Rowe Price
Trust Company; Vice President, T. Rowe
Price, T. Rowe Price Group, Inc.,
T. Rowe Price International, Inc., and
T. Rowe Price Retirement Plan
Services, Inc.
Alan D. Levenson, PhD (1958) Vice President, T. Rowe Price and
Vice President, Prime Reserve Fund T. Rowe Price Group, Inc.
Patricia B. Lippert (1953) Assistant Vice President, T. Rowe
Secretary, Prime Reserve Fund Price and T. Rowe Price Investment
Services, Inc.
Joseph K. Lynagh, CFA (1958) Vice President, T. Rowe Price and
Vice President, Prime Reserve Fund T. Rowe Price Group, Inc.
James M. McDonald (1949) Vice President, T. Rowe Price, T. Rowe
President, Prime Reserve Fund Price Group, Inc., and T. Rowe Price
Trust Company
Susan G. Troll, CPA (1966) Vice President, T. Rowe Price and
Vice President, Prime Reserve Fund T. Rowe Price Group, Inc.
Lea C. Ward (1968) Assistant Vice President, T. Rowe Price;
Vice President, Prime Reserve Fund formerly Customer Finance Analyst,
Lucent Technologies (to 2000)
Edward A. Wiese, CFA (1959) Vice President, T. Rowe Price, T. Rowe
Vice President, Prime Reserve Fund Price Group, Inc., and T. Rowe Price
Trust Company; Chief Investment
Officer, Director, and Vice President,
T. Rowe Price Savings Bank
Unless otherwise noted, officers have been employees of T. Rowe Price or T. Rowe
Price International for at least five years.
Item 2. Code of Ethics.
As of the end of the period covered by this report, the registrant has adopted a
code of ethics, as defined in Item 2 of Form N-CSR, applicable to its principal
executive officer, principal financial officer, principal accounting officer or
controller, or persons performing similar functions. A copy of this code of
ethics is filed as an exhibit to this Form N-CSR. No substantive amendments were
approved or waivers were granted to this code of ethics during the period
covered by this report.
Item 3. Audit Committee Financial Expert.
The registrant's Board of Directors/Trustees has determined that Mr. David K.
Fagin qualifies as an audit committee financial expert, as defined in Item 3 of
Form N-CSR. Mr. Fagin is considered independent for purposes of Item 3 of Form
N-CSR.
Item 4. Principal Accountant Fees and Services.
(a) - (d) Aggregate fees billed to the registrant for the last two fiscal years
for professional services rendered by the registrant's principal accountant were
as follows:
2004 2003
Audit Fees $9,419 $9,643
Audit-Related Fees 859 --
Tax Fees 2,603 2,597
All Other Fees 124 --
Audit fees include amounts related to the audit of the registrant's annual
financial statements and services normally provided by the accountant in
connection with statutory and regulatory filings. Audit-related fees include
amounts reasonably related to the performance of the audit of the registrant's
financial statements, specifically the issuance of a report on internal
controls. Tax fees include amounts related to tax compliance, tax planning, and
tax advice. Other fees include the registrant's pro-rata share of amounts for
agreed-upon procedures in conjunction with service contract approvals by the
registrant's Board of Directors/Trustees.
(e)(1) The registrant's audit committee has adopted a policy whereby audit and
non-audit services performed by the registrant's principal accountant for the
registrant, its investment adviser, and any entity controlling, controlled by,
or under common control with the investment adviser that provides ongoing
services to the registrant require pre-approval in advance at regularly
scheduled audit committee meetings. If such a service is required between
regularly scheduled audit committee meetings, pre-approval may be authorized by
one audit committee member with ratification at the next scheduled audit
committee meeting. Waiver of pre-approval for audit or non-audit services
requiring fees of a de minimis amount is not permitted.
(2) No services included in (b) - (d) above were approved pursuant to
paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.
(f) Less than 50 percent of the hours expended on the principal accountant's
engagement to audit the registrant's financial statements for the most recent
fiscal year were attributed to work performed by persons other than the
principal accountant's full-time, permanent employees.
(g) The aggregate fees billed for the most recent fiscal year and the preceding
fiscal year by the registrant's principal accountant for non-audit services
rendered to the registrant, its investment adviser, and any entity controlling,
controlled by, or under common control with the investment adviser that provides
ongoing services to the registrant were $819,000 and $671,000 respectively, and
were less than the aggregate fees billed for those same periods by the
registrant's principal accountant for audit services rendered to the T. Rowe
Price Funds.
(h) All non-audit services rendered in (g) above were pre-approved by the
registrant's audit committee. Accordingly, these services were considered by the
registrant's audit committee in maintaining the principal accountant's
independence.
Item 5. Audit Committee of Listed Registrants.
Not applicable.
Item 6. Schedule of Investments.
Not applicable. The complete schedule of investments is included in Item 1 of
this Form N-CSR.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies.
Not applicable.
Item 8. Purchases of Equity Securities by Closed-End Management Investment
Company and Affiliated Purchasers.
Not applicable.
Item 9. Submission of Matters to a Vote of Security Holders.
Not applicable.
Item 10. 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, as of that date, in ensuring that information
required to be disclosed by the registrant in this Form N-CSR was recorded,
processed, summarized, and reported timely.
(b) The registrant's principal executive officer and principal financial officer
are aware of no changes in the registrant's internal control over financial
reporting that occurred during the registrant's most recent fiscal half-year
that has materially affected, or is reasonably likely to materially affect, the
registrant's internal control over financial reporting.
Item 11. Exhibits.
(a)(1) The registrant's code of ethics pursuant to Item 2 of Form N-CSR is
attached.
(2) Separate certifications by the registrant's principal executive officer
and principal financial officer, pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002 and required by Rule 30a-2(a) under the Investment Company Act of
1940, are attached.
(3) Written solicitation to repurchase securities issued by closed-end
companies: not applicable.
(b) A certification by the registrant's principal executive officer and
principal financial officer, pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002 and required by Rule 30a-2(b) under the Investment Company Act of 1940,
is attached.
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.
T. Rowe Price Prime Reserve Fund, Inc.
By /s/ James S. Riepe
James S. Riepe
Principal Executive Officer
Date July 16, 2004
Pursuant to the requirements of the Securities Exchange Act of 1934 and
the Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By /s/ James S. Riepe
James S. Riepe
Principal Executive Officer
Date July 16, 2004
By /s/ Joseph A. Carrier
Joseph A. Carrier
Principal Financial Officer
Date July 16, 2004