UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
Investment Company Act file number 811-3757
DREYFUS CALIFORNIA TAX EXEMPT BOND FUND, INC.
(Exact name of Registrant as specified in charter)
c/o The Dreyfus Corporation
200 Park Avenue
New York, New York 10166
(Address of principal executive offices) (Zip code)
Mark N. Jacobs, Esq.
200 Park Avenue
New York, New York 10166
(Name and address of agent for service)
Registrant's telephone number, including area code: (212) 922-6000
Date of fiscal year end: May 31,
Date of reporting period: May 31, 2003
(PAGE)
FORM N-CSR
ITEM 1. REPORTS TO STOCKHOLDERS.
Dreyfus
California Tax Exempt
Bond Fund, Inc.
ANNUAL REPORT May 31, 2003
The views expressed in this report reflect those of the portfolio manager only
through the end of the period covered and do not necessarily represent the views
of Dreyfus or any other person in the Dreyfus organization. Any such views are
subject to change at any time based upon market or other conditions and Dreyfus
disclaims any responsibility to update such views. These views may not be relied
on as investment advice and, because investment decisions for a Dreyfus fund are
based on numerous factors, may not be relied on as an indication of trading
intent on behalf of any Dreyfus fund.
Not FDIC-Insured * Not Bank-Guaranteed * May Lose Value
Contents
THE FUND
- --------------------------------------------------
2 Letter from the Chairman
3 Discussion of Fund Performance
6 Fund Performance
7 Statement of Investments
13 Statement of Assets and Liabilities
14 Statement of Operations
15 Statement of Changes in Net Assets
16 Financial Highlights
17 Notes to Financial Statements
21 Report of Independent Auditors
22 Important Tax Information
23 Board Members Information
25 Officers of the Fund
FOR MORE INFORMATION
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Back Cover
The Fund
Dreyfus California
Tax Exempt Bond Fund, Inc.
LETTER FROM THE CHAIRMAN
Dear Shareholder:
This annual report for Dreyfus California Tax Exempt Bond Fund, Inc. covers the
12-month period from June 1, 2002, through May 31, 2003. Inside, you'll find
valuable information about how the fund was managed during the reporting period,
including a discussion with the fund's portfolio manager, Joseph Darcy.
We have recently seen some signs of stability in the U.S. financial markets.
Perhaps most important, the war in Iraq wound down quickly, without disrupting
oil supplies or major incidents of terrorism. Many stock market indices have
posted encouraging gains since the start of 2003, although it is uncertain
whether such gains will continue. At the same time, an estimated $350 billion in
federal tax cuts were signed into law on May 28, and the evidence to date
suggests that any adverse impact on municipal bond yields should be minimal.
Indeed, rising state and local taxes may make municipal bonds more valuable for
investors seeking tax-exempt income.
Of course, problems and concerns remain. In the U.S. economy, unemployment has
risen to multiyear highs, and corporations remain reluctant to spend. Positive
factors appear to outweigh negative ones, however, and we believe that the U.S.
economy is on the path to recovery.
What are the implications for your investments? We believe that municipal bonds
may benefit as state and local tax rates rise, making tax-exempt yields more
attractive compared to taxable yields for many investors. At the same time,
because of ongoing fiscal pressures affecting many states and municipalities,
diversification remains important. As for stocks, we currently believe that
selectivity among individual companies can be a key factor in the equity
markets. However, no one can say for certain what direction the markets will
take over time. Your financial advisor can help you to ensure that your
portfolio reflects your investment needs, long-term goals and attitudes toward
risk.
Thank you for your continued confidence and support.
Sincerely,
/s/Stephen E. Canter
Stephen E. Canter
Chairman and Chief Executive Officer
The Dreyfus Corporation
June 16, 2003
DISCUSSION OF FUND PERFORMANCE
Joseph Darcy, Portfolio Manager
How did Dreyfus California Tax Exempt Bond Fund, Inc. perform relative to its
benchmark?
For the 12-month period ended May 31, 2003, the fund achieved a total return of
10.30% .(1) In comparison, the Lehman Brothers Municipal Bond Index, the fund's
benchmark, achieved a total return of 10.36% for the same period.(2) In
addition, the fund is reported in the Lipper California Municipal Debt Funds
category. Over the reporting period, the average total return for all funds
reported in this Lipper category was 9.15% .(3) The fund's benchmark is a
broad-based measure of overall municipal bond performance. There are no
broad-based municipal bond market indices reflective of the performance of bonds
issued by a single state. For this reason, we have also provided the fund's
Lipper category average return for comparative purposes.
California' s municipal bond market was primarily influenced by declining
interest rates and robust investor demand for high-quality municipal bonds. The
fund' s return was roughly in line with its benchmark, which contains bonds from
many states, not just California, and does not reflect fees and expenses. The
fund produced a higher return than its Lipper category average, which we
attribute to our focus on high-quality securities.
What is the fund's investment approach?
The fund seeks as high a level of current income exempt from federal and
California state income taxes as is consistent with the preservation of capital.
To pursue this goal, the fund normally invests substantially all of its assets
in municipal bonds that provide income exempt from federal and California state
personal income taxes. The fund will invest at least 80% of its assets in
investment-grade municipal bonds or the unrated equivalent as determined by
Dreyfus. The dollar-weighted average maturity of the fund's portfolio normally
exceeds ten years, but the fund's average portfolio maturity is not restricted.
The portfolio manager may buy and sell bonds based on credit quality, market
outlook and yield potential. In selecting municipal bonds
The Fund
DISCUSSION OF FUND PERFORMANCE (CONTINUED)
for investment, the portfolio manager may assess the current interest-rate
environment and the municipal bond' s potential volatility in different rate
environments. The portfolio manager focuses on bonds with the potential to offer
attractive current income, typically looking for bonds that can provide
consistently attractive current yields or that are trading at competitive market
prices. A portion of the fund's assets may be allocated to "discount" bonds,
which are bonds that sell at a price below their face value, or to "premium"
bonds, which are bonds that sell at a price above their face value. The fund's
allocation either to discount bonds or to premium bonds will change along with
the portfolio manager's changing views of the current interest-rate and market
environment. The portfolio manager also may look to select bonds that are most
likely to obtain attractive prices when sold.
What other factors influenced the fund's performance?
Much of the reporting period was difficult for California's bond market. Because
the U.S. economy grew only modestly, the state received less revenue from income
taxes, sales taxes and capital gains taxes than it had projected. Faced with a
budget deficit estimated at more than $34 billion, the state attempted to bridge
a significant portion of the gap by issuing municipal bonds. At the same time,
several of the major, independent rating services downgraded California's credit
rating to the single-A range, effectively increasing the state's borrowing
costs.
The credit-rating downgrade and surge in the supply of newly issued bonds
contributed to heightened market volatility throughout the reporting period. The
effects of California's budget problems might have been more severe had it not
been for generally favorable market conditions on the national level. The
Federal Reserve Board's attempts to stimulate renewed economic growth included
lower interest rates, which drove bond yields lower and prices higher,
contributing positively to the fund's total return.
Because of these mounting fiscal pressures, we have continued to focus on
high-quality securities. As of the end of the reporting period, more than 65% of
the fund's holdings was rated triple-A, and more than 85% was rated single-A or
better. This strong credit profile helped the fund's relative performance as
lower-rated credits performed relatively poorly.
As part of our conservative strategy, we shifted assets away from the state's
uninsured general obligation bonds early in the reporting period. Instead, we
favored bonds from highly rated local government entities, including
revenue-producing essential-services facilities, such as water and sewer plants,
and certain school districts. Toward the end of the reporting period, however,
general obligation bonds had fallen to price levels we considered attractive
relative to historical norms. In addition, the state announced preliminary plans
to address its budget deficit that we believe are based on realistic revenue
forecasts. If an appropriate political consensus can be established, we may
begin to shift some assets back to the state's general obligation securities.
Finally, the fund benefited during most of the reporting period from its
relatively long average duration. As interest rates fell to historical lows, we
reduced the fund's average duration later in the reporting period to a range we
consider neutral relative to the fund's Lipper category average.
What is the fund's current strategy?
We continue to maintain what we consider to be a relatively conservative
investment posture, and we continue to monitor California's fiscal condition.
When purchasing new securities to complement the fund's core holdings, we
generally have focused on high-quality, income-oriented bonds in the 20-year
maturity range. Recently, we have maintained a relatively large cash reserve in
anticipation of an increase in the supply of newly issued bonds this summer
June 16, 2003
(1) TOTAL RETURN INCLUDES REINVESTMENT OF DIVIDENDS AND ANY CAPITAL GAINS PAID.
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. SHARE PRICE, YIELD AND
INVESTMENT RETURN FLUCTUATE SUCH THAT UPON REDEMPTION, FUND SHARES MAY BE
WORTH MORE OR LESS THAN THEIR ORIGINAL COST. INCOME MAY BE SUBJECT TO STATE
AND LOCAL TAXES FOR NON-CALIFORNIA RESIDENTS, AND SOME INCOME MAY BE
SUBJECT TO THE FEDERAL ALTERNATIVE MINIMUM TAX (AMT) FOR CERTAIN INVESTORS.
CAPITAL GAINS, IF ANY, ARE FULLY TAXABLE.
(2) SOURCE: LIPPER INC. -- REFLECTS REINVESTMENT OF DIVIDENDS AND, WHERE
APPLICABLE, CAPITAL GAIN DISTRIBUTIONS. THE LEHMAN BROTHERS MUNICIPAL BOND
INDEX IS A WIDELY ACCEPTED, UNMANAGED TOTAL RETURN PERFORMANCE BENCHMARK
FOR THE LONG-TERM, INVESTMENT-GRADE, TAX-EXEMPT BOND MARKET. INDEX RETURNS
DO NOT REFLECT FEES AND EXPENSES ASSOCIATED WITH OPERATING A MUTUAL FUND.
(3) SOURCE: LIPPER INC. -- CATEGORY AVERAGE RETURNS REFLECT THE FEES AND
EXPENSES OF THE FUNDS COMPRISING THE AVERAGE.
The Fund
FUND PERFORMANCE
Dreyfus Lehman
California Brothers
Tax Exempt Municipal
PERIOD Bond Bond
Fund, Inc. Index *
5/31/93 10,000 10,000
5/31/94 10,158 10,247
5/31/95 10,760 11,181
5/31/96 10,930 11,691
5/31/97 11,762 12,660
5/31/98 12,808 13,847
5/31/99 13,297 14,494
5/31/00 13,026 14,369
5/31/01 14,586 16,113
5/31/02 15,562 17,161
5/31/03 17,164 18,941
Comparison of change in value of $10,000 investment in Dreyfus California Tax
Exempt Bond Fund, Inc. and the Lehman Brothers Municipal Bond Index
- --------------------------------------------------------------------------------
Average Annual Total Returns AS OF 5/31/03
1 Year 5 Years 10 Years
- ------------------------------------------------------------------------------------------------------------------------------------
FUND 10.30% 6.03% 5.55%
((+)) SOURCE: LIPPER INC.
PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE. THE FUND'S PERFORMANCE
SHOWN IN THE GRAPH AND TABLE DOES NOT REFLECT THE DEDUCTION OF TAXES THAT A
SHAREHOLDER WOULD PAY ON FUND DISTRIBUTIONS OR THE REDEMPTION OF FUND SHARES.
THE ABOVE GRAPH COMPARES A $10,000 INVESTMENT MADE IN DREYFUS CALIFORNIA TAX
EXEMPT BOND FUND, INC. ON 5/31/93 TO A $10,000 INVESTMENT MADE IN THE LEHMAN
BROTHERS MUNICIPAL BOND INDEX (THE "INDEX") ON THAT DATE. ALL DIVIDENDS AND
CAPITAL GAIN DISTRIBUTIONS ARE REINVESTED.
THE FUND INVESTS PRIMARILY IN CALIFORNIA MUNICIPAL SECURITIES AND ITS
PERFORMANCE SHOWN IN THE LINE GRAPH ABOVE TAKES INTO ACCOUNT FEES AND EXPENSES.
THE INDEX IS NOT LIMITED TO INVESTMENTS PRINCIPALLY IN CALIFORNIA MUNICIPAL
OBLIGATIONS AND DOES NOT TAKE INTO ACCOUNT CHARGES, FEES AND OTHER EXPENSES. THE
INDEX, UNLIKE THE FUND, IS AN UNMANAGED TOTAL RETURN PERFORMANCE BENCHMARK FOR
THE LONG-TERM, INVESTMENT-GRADE, GEOGRAPHICALLY UNRESTRICTED TAX-EXEMPT BOND
MARKET, CALCULATED BY USING MUNICIPAL BONDS SELECTED TO BE REPRESENTATIVE OF THE
MUNICIPAL MARKET OVERALL. THESE FACTORS CAN CONTRIBUTE TO THE INDEX POTENTIALLY
OUTPERFORMING OR UNDERPERFORMING THE FUND. FURTHER INFORMATION RELATING TO FUND
PERFORMANCE, INCLUDING EXPENSE REIMBURSEMENTS, IF APPLICABLE, IS CONTAINED IN
THE FINANCIAL HIGHLIGHTS SECTION OF THE PROSPECTUS AND ELSEWHERE IN THIS REPORT
STATEMENT OF INVESTMENTS
May 31, 2003
Principal
LONG-TERM MUNICIPAL INVESTMENTS--96.5% Amount ($) Value ($)
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CALIFORNIA--85.4%
Anaheim Public Finance Authority, Tax Allocation Revenue
6.45%, 12/28/2018 (Insured; MBIA) 20,000,000 23,825,400
California, GO:
5.50%, 9/1/2024 10,000,000 10,580,500
5%, 2/1/2026 15,000,000 15,377,850
5.65%, 6/1/2030 22,330,000 24,038,245
5%, 2/1/2032 23,000,000 23,502,780
California Department of Veteran Affairs,
Home Purchase Revenue
5.50%, 12/1/2019 15,000,000 16,169,100
California Department of Water Resources:
(Central Valley Project--Water System Revenue)
5%, 12/1/2011 (Insured; FGIC) 15,415,000 17,857,815
Power Supply Revenue:
5.875%, 5/1/2016 10,000,000 11,575,000
5.375%, 5/1/2018 (Insured; AMBAC) 27,100,000 30,771,779
California Educational Facilities Authority, Revenue:
(California Institute of Technology)
5%, 10/1/2032 19,500,000 20,555,730
(University of Southern California)
5%, 10/1/2033 26,000,000 27,499,160
California Health Facilities Financing Authority,
Revenue:
(Cedars-Sinai Medical Center) 6.125%, 12/1/2030 27,695,000 29,935,525
(San Diego Hospital Association)
6.125%, 8/1/2022 (Insured; MBIA) 4,250,000 4,351,065
(Sutter Health) 5.35%, 8/15/2028 (Insured; MBIA) 3,000,000 3,253,050
California Housing Finance Agency:
Home Mortage Revenue:
6.30%, 2/1/2008 1,380,000 1,424,795
6.40%, 8/1/2027 (Insured; MBIA) 7,905,000 8,121,597
MFHR 6.30%, 8/1/2026 (Insured; AMBAC) 7,130,000 7,506,464
Revenue 11.64%, 8/1/2026 5,610,000 (a,b) 6,071,422
Single Family Mortgage:
6.25%, 8/1/2014 (Insured; AMBAC) 1,390,000 1,484,020
6.30%, 8/1/2024 3,785,000 3,933,145
6.45%, 8/1/2025 5,050,000 5,188,370
California Infrastructure and Economic
Development Bank, Revenue
(Clean Water State Revolving Fund)
5%, 10/1/2017 8,735,000 9,744,679
The Fund
STATEMENT OF INVESTMENTS (CONTINUED)
Principal
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) Amount ($) Value ($)
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CALIFORNIA (CONTINUED)
California Pollution Control Financing Authority,
PCR:
10.271%, 6/1/2014 24,165,000 (a,b) 35,786,432
(Southern California Edison Co.):
7%, 3/1/2005 15,000,000 15,308,100
6.40%, 12/1/2024 12,600,000 12,611,718
California Public Works Board, LR:
(Department of Corrections, Calipatria
State Prison, Imperial County)
6.50%, 9/1/2017 (Insured; MBIA) 13,000,000 16,893,110
(Department of General Services-
Capital East End Complex)
5.25%, 12/1/2019 (Insured; AMBAC) 10,000,000 11,160,200
(University of California Project)
5.35%, 12/1/2015 (Insured; AMBAC) 11,415,000 12,965,956
(Various University of California Projects):
5.50%, 6/1/2014 5,000,000 5,969,800
6.375%, 10/1/2019 (Prerefunded 10/1/2004) 7,775,000 (c) 8,479,959
California State University, Fresno Association Inc.,
Auxiliary Organization Event Center Revenue:
6%, 7/1/2022 3,500,000 3,697,750
6%, 7/1/2026 2,500,000 2,628,300
6%, 7/1/2031 5,250,000 5,467,665
California Statewide Communities
Development Authority:
COP:
(Saint Joseph Health System Group)
6.50%, 7/1/2015 (Prerefunded 7/1/2004) 7,000,000 (c) 7,551,250
(The Internext Group) 5.375%, 4/1/2030 19,000,000 19,101,080
Revenue:
(Kaiser Permanente) 5.50%, 11/1/2032 13,500,000 14,089,140
(Sutter Health) 5.50%, 8/15/2028 10,000,000 10,496,300
Central California Joint Powers
Health Financing Authority, COP
(Community Hospitals of Central California)
5.75%, 2/1/2031 15,000,000 15,489,450
Delano, COP (Delano Regional Medical Center)
5.25%, 1/1/2018 10,000,000 9,529,200
Fontana, Special Tax
5.25%, 9/1/2017 (Insured; MBIA) 10,000,000 11,276,400
Fremont Union High School District
5.25%, 9/1/2025 (Insured; FGIC) 11,295,000 12,242,086
Principal
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) Amount ($) Value ($)
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CALIFORNIA (CONTINUED)
Fresno, Sewer Revenue
5.25%, 9/1/2019 (Insured; AMBAC) 9,400,000 11,009,562
Los Angeles, GO:
5%, 9/1/2019 (Insured; MBIA) 13,110,000 14,364,365
5%, 9/1/2020 (Insured; MBIA) 12,610,000 13,723,967
Los Angeles County Metropolitan Transportation Authority,
Proposition A First Tier Senior Sales Tax Revenue
5%, 7/1/2018 (Insured; FSA) 20,000,000 22,216,000
Los Angeles County Public Works Financing
Authority, Revenue (Los Angeles County Flood
Control District) 5%, 3/1/2011 (Insured; MBIA) 11,660,000 13,361,777
Los Angeles Department Water and Power, Revenue:
Power System:
5.25%, 7/1/2013 (Insured; MBIA) 12,000,000 13,827,840
5.25%, 7/1/2019 (Insured; FSA) 44,000,000 48,990,920
Waterworks
6.375%, 7/1/2034 (Insured; MBIA) 9,000,000 9,657,630
Los Angeles Harbor Department, Revenue
6%, 8/1/2012 8,900,000 9,995,145
Merced Union High School District:
Zero Coupon, 8/1/2023 (Insured; FGIC) 2,500,000 959,450
Zero Coupon, 8/1/2024 (Insured; FGIC) 2,555,000 925,472
Metropolitan Water District of
Southern California, Waterworks Revenue:
5.25%, 3/1/2019 4,915,000 5,480,471
5.25%, Series A, 3/1/2020 4,425,000 4,905,599
5.25%, Series B, 3/1/2020 2,450,000 2,716,095
5.25%, 3/1/2021 5,430,000 5,985,055
Modesto, Multi-Family Housing Mortage Revenue
6.40%, 6/1/2029 7,723,000 7,853,364
M-S-R Public Power Agency, Revenue
(San Juan Project) 5.90%, 7/1/2020 5,490,000 5,498,455
Northern California Power Agency, Revenue
(Hydroelectric Project Number 1):
7%, 7/1/2016 (Insured; AMBAC)
(Prerefunded 1/1/2016) 670,000 (c) 902,550
5.125%, 7/1/2023 (Insured; MBIA) 15,000,000 15,845,700
7.50%, 7/1/2023 (Insured; AMBAC)
(Prerefunded 7/1/2021) 375,000 (c) 534,221
Oakland Unified School District
5.25%, 8/1/2024 (Insured; FGIC) 17,275,000 18,717,808
The Fund
STATEMENT OF INVESTMENTS (CONTINUED)
Principal
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) Amount ($) Value ($)
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CALIFORNIA (CONTINUED)
Pasadena Community Development Commission,
MFHR (Civic Center)
6.45%, 12/1/2021 (Insured; FSA) 13,185,000 13,465,181
Port of Oakland, Revenue
Special Facilities (Mitsui O.S.K. Lines Ltd.)
6.80%, 1/1/2019 (LOC; Industrial Bank of Japan) 1,385,000 1,403,047
Public Utilities Commission of the City and County
of San Francisco, Clean Water Revenue:
5%, 10/1/2012 (Insured; MBIA) 23,095,000 26,800,362
5%, 10/1/2013 (Insured; MBIA) 22,195,000 25,735,546
Sacramento County, Airport System Revenue
6%, 7/1/2017 (Insured; MBIA) 5,850,000 6,581,426
Sacramento Municipal Utility District,
Electric Revenue:
6.50%, 9/1/2013 (Insured; MBIA) 6,930,000 8,728,127
9.795%, 11/15/2015 (Insured; MBIA) 9,000,000 (a,b) 9,677,430
5.20%, 7/1/2017 (Insured; MBIA) 300,000 336,318
5%, 8/15/2020 (Insured; MBIA) 14,010,000 (d) 15,352,438
5%, 8/15/2033 (Insured; MBIA) 10,000,000 (d) 10,594,100
San Bernardino County, COP
(Capital Facilities Project) 6.875%, 8/1/2024 5,000,000 6,761,050
San Juan Unified School District:
Zero Coupon, 8/1/2023 (Insured; FSA) 10,030,000 3,849,313
Zero Coupon, 8/1/2024 (Insured; FSA) 10,655,000 3,859,454
Southern California Rapid Transportation District,
COP (Workers Compensation Fund)
6.50%, 7/1/2007 (Insured; MBIA) 21,900,000 22,327,926
University of California, Revenue (Multi Purpose):
5.25%, 9/1/2027 (Insured; MBIA) 33,475,000 36,290,582
5%, 9/1/2033 (Insured; FSA) 10,000,000 10,569,600
Whittier Health Facility, Revenue
(Presbyterian Intercommunity Hospital)
5.75%, 6/1/2031 10,090,000 10,596,720
U.S. RELATED--11.1%
Commonwealth of Puerto Rico, Public Improvement
5.50%, 7/1/2016 (Insured; MBIA) 11,830,000 14,303,653
Principal
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) Amount ($) Value ($)
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U.S. RELATED (CONTINUED)
Commonwealth of Puerto Rico
Infrastructure Financing Authority,
Special Tax Revenue:
5%, 7/1/2014 (Insured; AMBAC) 15,000,000 16,700,550
5.50%, 10/1/2032 26,000,000 29,461,380
5.50%, 10/1/2040 33,290,000 37,742,870
Puerto Rico Public Finance Corp.
5.125%, 6/1/2024 25,000,000 28,680,750
TOTAL LONG-TERM MUNICIPAL INVESTMENTS
(cost $1,022,112,646) 1,100,800,656
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SHORT-TERM MUNICIPAL INVESTMENTS--4.7%
- ------------------------------------------------------------------------------------------------------------------------------------
Abag Finance Authority for Nonprofit Corps.,
Revenue, VRDN (Jewish Community
Center Project) 1.30% (LOC; Bank of
New York and Allied Irish Bank) 3,775,000 (e) 3,775,000
California, VRDN 1.30%
(LOC; Westdeutsche Landesbank
and J.P. Morgan Chase & Co.) 18,500,000 (e) 18,500,000
California Department of Water Resources,
Power Supply, Revenue, VRDN:
1.30% (LOC; Bank of New York) 8,000,000 (e) 8,000,000
1.30% (LOC; Bank of New York) 12,000,000 (e) 12,000,000
California Statewide Communities
Development Authority, Revenue, COP, VRDN
(Sutter Health Obligation Group)
1.25% (Insured; AMBAC) 10,300,000 (e) 10,300,000
Newport Beach, Revenue, VRDN
(Hoag Memorial Hospital) 1.30% 500,000 (e) 500,000
TOTAL SHORT-TERM MUNICIPAL INVESTMENTS
(cost $53,075,000) 53,075,000
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TOTAL INVESTMENTS (cost $1,075,187,646) 101.2% 1,153,875,656
LIABILITIES, LESS CASH AND RECEIVABLES (1.2%) (13,478,006)
NET ASSETS 100.0% 1,140,397,650
The Fund
STATEMENT OF INVESTMENTS (CONTINUED)
Summary of Abbreviations
AMBAC American Municipal Bond Assurance
Corporation
COP Certificate of Participation
FGIC Financial Guaranty Insurance
Company
FSA Financial Security Assurance
GO General Obligation
LOC Letter of Credit
LR Lease Revenue
MBIA Municipal Bond Investors Assurance
Insurance Corporation
MFHR Multi-Family Housing Revenue
PCR Pollution Control Revenue
VRDN Variable Rate Demand Notes
Summary of Combined Ratings (Unaudited)
Fitch or Moody's or Standard & Poor's Value (%)
- ------------------------------------------------------------------------------------------------------------------------------------
AAA Aaa AAA 67.8
AA Aa AA 9.0
A A AA 11.2
BBB Baa BBB 5.0
BB Ba BB 2.4
F1 MIG1/P1 SP1/A1 4.6
100.0
(A) SECURITIES EXEMPT FROM REGISTRATION UNDER RULE 144A OF THE SECURITIES ACT
OF 1933. THESE SECURITIES MAY BE RESOLD IN TRANSACTIONS EXEMPT FROM
REGISTRATION, NORMALLY TO QUALIFIED INSTITUTIONAL BUYERS. AT MAY 31, 2003,
THESE SECURITIES AMOUNTED TO $51,535,284 OR 4.5% OF NET ASSETS.
(B) INVERSE FLOATER SECURITY--THE INTEREST RATE IS SUBJECT TO CHANGE
PERIODICALLY.
(C) BONDS WHICH ARE PREREFUNDED ARE COLLATERALIZED BY U.S. GOVERNMENT
SECURITIES WHICH ARE HELD IN ESCROW AND ARE USED TO PAY PRINCIPAL AND
INTEREST ON THE MUNICIPAL ISSUE AND TO RETIRE THE BONDS IN FULL AT THE
EARLIEST REFUNDING DATE.
(D) PURCHASED ON A DELAYED DELIVERY BASIS.
(E) SECURITIES PAYABLE ON DEMAND. VARIABLE INTEREST RATE--SUBJECT TO PERIODIC
CHANGE.
(F) AT MAY 31, 2003, 28.5% OF THE FUND'S NET ASSETS INSURED BY MBIA.
SEE NOTES TO THE FINANCIAL STATEMENTS.
STATEMENT OF ASSETS AND LIABILITIES
May 31, 2003
Cost Value
- --------------------------------------------------------------------------------
ASSETS ($):
Investments in securities--See Statement of
Investments 1,075,187,646 1,153,875,65
Cash 149,501
Interest receivable 17,304,477
Receivable for shares of Common Stock subscribed 3,933
Prepaid expenses 30,579
1,171,364,146
- --------------------------------------------------------------------------------
LIABILITIES ($):
Due to The Dreyfus Corporation and affiliates 622,696
Payable for investment securities purchased 27,838,049
Payable for shares of Common Stock redeemed 2,381,656
Accrued expenses 124,095
30,966,496
- --------------------------------------------------------------------------------
NET ASSETS ($) 1,140,397,650
- --------------------------------------------------------------------------------
COMPOSITION OF NET ASSETS ($):
Paid-in capital 1,055,411,242
Accumulated undistributed investment income--net 124,601
Accumulated net realized gain (loss) on investments 6,173,797
Accumulated net unrealized appreciation
(depreciation) on investments 78,688,010
- --------------------------------------------------------------------------------
NET ASSETS ($) 1,140,397,650
- --------------------------------------------------------------------------------
SHARES OUTSTANDING
(300 million shares of $.001 par value Common Stock authorized) 74,615,475
NET ASSET VALUE, offering and redemption price per share--Note 3(d) ($) 15.28
SEE NOTES TO FINANCIAL STATEMENTS.
The Fund
STATEMENT OF OPERATIONS
Year Ended May 31, 2003
- --------------------------------------------------------------------------------
INVESTMENT INCOME ($):
INTEREST INCOME 55,351,392
EXPENSES:
Management fee--Note 3(a) 6,673,238
Shareholder servicing costs--Note 3(b) 870,062
Custodian fees 83,083
Professional fees 58,968
Directors' fees and expenses--Note 3(c) 54,405
Prospectus and shareholders' reports 28,444
Registration fees 26,175
Loan commitment fees--Note 2 15,470
Miscellaneous 29,828
TOTAL EXPENSES 7,839,673
INVESTMENT INCOME--NET 47,511,719
- --------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS--NOTE 4 ($):
Net realized gain (loss) on investments 11,598,844
Net unrealized appreciation (depreciation) on investments 51,343,818
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS 62,942,662
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS 110,454,381
SEE NOTES TO FINANCIAL STATEMENTS.
STATEMENT OF CHANGES IN NET ASSETS
Year Ended May 31,
------------------------------------
2003 2002
- --------------------------------------------------------------------------------
OPERATIONS ($):
Investment income--net 47,511,719 50,414,211
Net realized gain (loss) on investments 11,598,844 21,740,226
Net unrealized appreciation
(depreciation) on investments 51,343,818 (512,772)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS 110,454,381 71,641,665
- --------------------------------------------------------------------------------
DIVIDENDS TO SHAREHOLDERS FROM ($):
Investment income--net (47,254,638) (50,093,523)
Net realized gain on investments (11,261,160) (18,656,233)
TOTAL DIVIDENDS (58,515,798) (68,749,756)
- --------------------------------------------------------------------------------
CAPITAL STOCK TRANSACTIONS ($):
Net proceeds from shares sold 232,655,581 135,978,352
Dividends reinvested 39,551,645 46,241,906
Cost of shares redeemed (283,499,067) (184,856,463)
INCREASE (DECREASE) IN NET ASSETS
FROM CAPITAL STOCK TRANSACTIONS (11,291,841) (2,636,205)
TOTAL INCREASE (DECREASE) IN NET ASSETS 40,646,742 255,704
- --------------------------------------------------------------------------------
NET ASSETS ($):
Beginning of Period 1,099,750,908 1,099,495,204
END OF PERIOD 1,140,397,650 1,099,750,908
Undistributed investment income--net 124,601 --
- --------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS (SHARES):
Shares sold 15,706,623 9,245,260
Shares issued for dividends reinvested 2,665,098 3,147,739
Shares redeemed (19,100,849) (12,550,197)
NET INCREASE (DECREASE) IN SHARES OUTSTANDING (729,128) (157,198)
SEE NOTES TO FINANCIAL STATEMENTS.
The Fund
FINANCIAL HIGHLIGHTS
The following table describes the performance for the fiscal periods indicated.
Total return shows how much your investment in the fund would have increased (or
decreased) during each period, assuming you had reinvested all dividends and
distributions. These figures have been derived from the fund's financial
statements.
Year Ended May 31,
-------------------------------------------------------------------------
2003 2002(a) 2001 2000 1999
- ------------------------------------------------------------------------------------------------------------------------------------
PER SHARE DATA ($):
Net asset value,
beginning of period 14.60 14.56 13.65 14.72 14.88
Investment Operations:
Investment income--net .63(b) .67(b) .71 .70 .68
Net realized and unrealized
gain (loss) on investments .83 .29 .91 (1.01) (.12)
Total from Investment Operations 1.46 .96 1.62 (.31) .56
Distributions:
Dividends from
investment income--net (.63) (.67) (.71) (.71) (.68)
Dividends from net realized
gain on investments (.15) (.25) -- (.05) (.04)
Total Distributions (.78) (.92) (.71) (.76) (.72)
Net asset value, end of period 15.28 14.60 14.56 13.65 14.72
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN (%) 10.30 6.69 11.98 (2.04) 3.81
- ------------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA (%):
Ratio of expenses to
average net assets .70 .71 .70 .73 .72
Ratio of net investment income
to average net assets 4.27 4.54 4.87 5.03 4.56
Portfolio Turnover Rate 47.21 51.69 32.21 34.09 58.49
- ------------------------------------------------------------------------------------------------------------------------------------
Net Assets, end of period
($ x 1,000) 1,140,398 1,099,751 1,099,495 1,045,993 1,234,856
(A) AS REQUIRED, EFFECTIVE JUNE 1, 2001, THE FUND HAS ADOPTED THE PROVISIONS OF
THE AICPA AUDIT AND ACCOUNTING GUIDE FOR INVESTMENT COMPANIES AND BEGAN
AMORTIZING DISCOUNT OR PERMIUM ON A SCIENTIFIC BASIS FOR DEBT SECURITIES ON
A DAILY BASIS. THE EFFECT OF THIS CHANGE FOR THE PERIOD ENDED MAY 31, 2002
WAS TO INCREASE NET INVESTMENT INCOME PER SHARE AND DECREASE NET REALIZED
AND UNREALIZED GAIN (LOSS) ON INVESTMENTS BY LESS THAN $.01 AND INCREASE
THE RATIO OF NET INVESTMENT INCOME TO AVERAGE NET ASSETS FROM 4.51% TO
4.54%. PER SHARE DATA AND RATIOS/SUPPLEMENTAL DATA FOR PERIODS PRIOR TO
JUNE 1, 2001 HAVE NOT BEEN RESTATED TO REFLECT THIS CHANGE IN PRESENTATION.
(B) BASED ON AVERAGE SHARES OUTSTANDING AT EACH MONTH END.
SEE NOTES TO FINANCIAL STATEMENTS.
NOTES TO FINANCIAL STATEMENTS
NOTE 1--Significant Accounting Policies:
Dreyfus California Tax Exempt Bond Fund, Inc. (the "fund") is registered under
the Investment Company Act of 1940, as amended (the "Act"), as a non-diversified
open-end management investment company. The fund's investment objective is to
provide investors with a high level of current income exempt from federal and
California state income taxes, as is consistent with the preservation of
capital. The Dreyfus Corporation (the "Manager") serves as the fund's investment
adviser. The Manager is a wholly-owned subsidiary of Mellon Bank, N.A., which is
a wholly-owned subsidiary of Mellon Financial Corporation. Dreyfus Service
Corporation (the "Distributor" ), a wholly-owned subsidiary of the Manager, is
the distributor of the fund's shares, which are sold to the public without a
sales charge.
The fund' s financial statements are prepared in accordance with accounting
principles generally accepted in the United States, which may require the use of
management estimates and assumptions. Actual results could differ from those
estimates.
(A) PORTFOLIO VALUATION: Investments in securities are valued each business day
by an independent pricing service (the "Service") approved by the Board of
Directors. Investments for which quoted bid prices are readily available and are
representative of the bid side of the market in the judgment of the Service are
valued at the mean between the quoted bid prices (as obtained by the Service
from dealers in such securities) and asked prices (as calculated by the Service
based upon its evaluation of the market for such securities). Other investments
(which constitute a majority of the portfolio securities) are carried at fair
value as determined by the Service, based on methods which include consideration
of: yields or prices of municipal securities of comparable quality, coupon,
maturity and type; indications as to values from dealers; and general market
conditions.
(B) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities transactions are
recorded on a trade date basis. Realized gain and loss from securities
transactions are recorded on the identified cost basis. Interest income,
adjusted for amortization of discount and premium on invest
The Fund
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
ments, is earned from settlement date and recognized on the accrual basis.
Securities purchased or sold on a when-issued or delayed-delivery basis may be
settled a month or more after the trade date. Under the terms of the custody
agreement, the fund received net earnings credits of $58,534 during the period
ended May 31, 2003 based on available cash balances left on deposit. Income
earned under this arrangement is included in interest income.
The fund follows an investment policy of investing primarily in municipal
obligations of one state. Economic changes affecting the state and certain of
its public bodies and municipalities may affect the ability of issuers within
the state to pay interest on, or repay principal of, municipal obligations held
by the fund.
(C) DIVIDENDS TO SHAREHOLDERS: It is the policy of the fund to declare dividends
daily from investment income-net. Such dividends are paid monthly. Dividends
from net realized capital gain, if any, are normally declared and paid annually,
but the fund may make distributions on a more frequent basis to comply with the
distribution requirements of the Internal Revenue Code of 1986, as amended (the
"Code"). To the extent that net realized capital gain can be offset by capital
loss carryovers, if any, it is the policy of the fund not to distribute such
gain.
(D) FEDERAL INCOME TAXES: It is the policy of the fund to continue to qualify as
a regulated investment company, which can distribute tax exempt dividends, by
complying with the applicable provisions of the Code, and to make distributions
of income and net realized capital gain sufficient to relieve it from
substantially all federal income and excise taxes.
At May 31, 2003, the components of accumulated earnings on a tax basis were as
follows: undistributed ordinary income $2,125,990, undistributed capital gains
$4,047,807 and unrealized appreciation $78,737,328.
The tax character of distributions paid to shareholders during the fiscal
periods ended May 31, 2003 and May 31, 2002, were as follows: tax exempt income
$47,254,638 and $50,093,523, ordinary income $1,927,910 and $3,830,107 and long
term capital gain $9,333,250 and $14,826,126, respectively.
During the period ended May 31, 2003, as a result of permanent book to tax
differences, the fund decreased accumulated undistributed investment income-net
by $132,480, increased accumulated net realized gain (loss) on investments by
$540,917 and decreased paid-in capital by $408,437. Net assets were not affected
by this reclassification
NOTE 2--Bank Line of Credit:
The fund participates with other Dreyfus-managed funds in a $500 million
redemption credit facility (the "Facility" ) to be utilized for temporary or
emergency purposes, including the financing of redemptions. In connection
therewith, the fund has agreed to pay commitment fees on its pro rata portion of
the Facility. Interest is charged to the fund based on prevailing market rates
in effect at the time of borrowings. During the period ended May 31, 2003, the
fund did not borrow under the Facility.
NOTE 3--Management Fee and Other Transactions with Affiliates:
(A) Pursuant to a management agreement ("Agreement") with the Manager, the
management fee is computed at the annual rate of .60 of 1% of the value of the
fund' s average daily net assets and is payable monthly. The Agreement provides
that if in any full fiscal year the aggregate expenses of the fund, exclusive of
taxes, brokerage fees, interest on borrowings, commitment fees and extraordinary
expenses, exceed 11_2% of the value of the fund's average net assets, the fund
may deduct from the payments to be made to the Manager, or the Manager will bear
such excess expense. During the period ended May 31, 2003, there was no expense
reimbursement pursuant to the Agreement.
(B) Under the Shareholder Services Plan, the fund reimburses the Distributor an
amount not to exceed an annual rate of .25 of 1% of the value of the fund's
average daily net assets for certain allocated expenses of providing personal
services and/or maintaining shareholder accounts. The services provided may
include personal services relating to shareholder accounts, such as answering
shareholder inquiries regarding the fund and providing reports and other informa
The Fund
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
tion, and services related to the maintenance of shareholder accounts. During
the period ended May 31, 2003, the fund was charged $514,995 pursuant to the
Shareholder Services Plan.
The fund compensates Dreyfus Transfer, Inc., a wholly-owned subsidiary of the
Manager, under a transfer agency agreement for providing personnel and
facilities to perform transfer agency services for the fund. During the period
ended May 31, 2003, the fund was charged $274,655 pursuant to the transfer
agency agreement.
(C) Each director who is not an "affiliated person" as defined in the Act
receives from the fund an annual fee of $4,500 and an attendance fee of $500 per
meeting. The Chairman of the Board receives an additional 25% of such
compensation.
(D) A .10% redemption fee is charged and retained by the fund on shares redeemed
within thirty days following the date of issuance, including redemptions made
through the use of the fund's exchange privilege. During the period ended May
31, 2003, redemption fees charged and retained by the fund amounted to $65,350.
NOTE 4--Securities Transactions:
The aggregate amount of purchases and sales of investment securities, excluding
short-term securities, during the period ended May 31, 2003, amounted to
$516,467,857 and $495,781,178, respectively.
At May 31, 2003, the cost of investments for federal income tax purposes was
$1,075,138,328; accordingly, accumulated net unrealized appreciation on
investments was $78,737,328, consisting of $78,910,490 gross unrealized
appreciation and $173,162 gross unrealized depreciation.
REPORT OF INDEPENDENT AUDITORS
Shareholders and Board of Directors Dreyfus California Tax Exempt Bond Fund,
Inc.
We have audited the accompanying statement of assets and liabilities of Dreyfus
California Tax Exempt Bond Fund, Inc., including the statement of investments,
as of May 31, 2003, 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 financial highlights for each of the years indicated
therein. These financial statements and financial highlights are the
responsibility of the Fund' 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 auditing standards generally accepted
in the 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. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements and financial highlights. Our procedures included
confirmation of securities owned as of May 31, 2003 by correspondence with the
custodian and others. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating the
overall financial statement presentation. 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
Dreyfus California Tax Exempt Bond Fund, Inc. at May 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 indicated years, in conformity with accounting principles generally
accepted in the United States.
Ernst & Young LLP
New York, New York
July 7, 2003
The Fund
IMPORTANT TAX INFORMATION (Unaudited)
In accordance with federal tax law, the fund hereby makes the following
designations regarding its fiscal year ended May 31, 2003:
--all the dividends paid from investment income-net are "exempt-interest
dividends" (not subject to regular federal income tax, and for individuals who
are California residents, California personal income taxes), and
--the fund hereby designates $.1244 per share as a long-term capital gain
distribution of the $.1501 per share paid on December 6, 2002.
As required by federal tax law rules, shareholders will receive notification of
their portion of the fund' s taxable ordinary dividends (if any) and capital
gains distributions (if any) paid for the 2003 calendar year on Form 1099-DIV
which will be mailed by January 31, 2004.
BOARD MEMBERS INFORMATION (Unaudited)
JOSEPH S. DIMARTINO (59)
CHAIRMAN OF THE BOARD (1995)
PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
* Corporate Director and Trustee
OTHER BOARD MEMBERSHIPS AND AFFILIATIONS:
* The Muscular Dystrophy Association, Director
* Levcor International, Inc., an apparel fabric processor, Director
* Century Business Services, Inc., a provider of outsourcing functions for
small and medium size companies, Director
* The Newark Group, a provider of a national market of paper recovery
facilities, paperboard mills and paperboard converting plants, Directo
NO. OF PORTFOLIOS FOR WHICH BOARD MEMBER SERVES: 191
--------------
DAVID W. BURKE (67)
BOARD MEMBER (1994)
PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
* Corporate Director and Trustee
OTHER BOARD MEMBERSHIPS AND AFFILIATIONS:
* John F. Kennedy Library Foundation, Director
* U.S.S. Constitution Museum, Director
NO. OF PORTFOLIOS FOR WHICH BOARD MEMBER SERVES: 87
--------------
SAMUEL CHASE (71)
BOARD MEMBER (1983)
PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
* Corporate Director and Trustee
NO. OF PORTFOLIOS FOR WHICH BOARD MEMBER SERVES: 15
--------------
GORDON J. DAVIS (61)
BOARD MEMBER (1995)
PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
* Partner in the law firm of LeBoeuf, Lamb, Greene & MacRae LLP
* President, Lincoln Center for the Performing Arts, Inc. (2001)
OTHER BOARD MEMBERSHIPS AND AFFILIATIONS:
* Consolidated Edison, Inc., a utility company, Director
* Phoenix Companies, Inc., a life insurance company, Director
* Board Member/Trustee for several not-for-profit groups
NO. OF PORTFOLIOS FOR WHICH BOARD MEMBER SERVES: 26
The Fund
BOARD MEMBERS INFORMATION (Unaudited) (CONTINUED)
JONI EVANS (61)
BOARD MEMBER (1983)
PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
* Senior Vice President of the William Morris Agency
NO. OF PORTFOLIOS FOR WHICH BOARD MEMBER SERVES: 15
--------------
ARNOLD S. HIATT (76)
BOARD MEMBER (1983)
PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
* Chairman of The Stride Rite Charitable Foundation
OTHER BOARD MEMBERSHIPS AND AFFILIATIONS:
* Isabella Stewart Gardner Museum, Trustee
* John Merck Fund, a charitable trust, Trustee
* Business for Social Responsibility, Chairman
NO. OF PORTFOLIOS FOR WHICH BOARD MEMBER SERVES: 15
--------------
BURTON N. WALLACK (52)
BOARD MEMBER (1991)
PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
* President and co-owner of Wallack Management Company, a real estate
management company
NO. OF PORTFOLIOS FOR WHICH BOARD MEMBER SERVES: 15
--------------
ONCE ELECTED ALL BOARD MEMBERS SERVE FOR AN INDEFINITE TERM. ADDITIONAL
INFORMATION ABOUT THE BOARD MEMBERS, INCLUDING THEIR ADDRESS IS AVAILABLE IN THE
FUND'S STATEMENT OF ADDITIONAL INFORMATION WHICH CAN BE OBTAINED FROM DREYFUS
FREE OF CHARGE BY CALLING THIS TOLL FREE NUMBER: 1-800-554-4611.
OFFICERS OF THE FUND (Unaudited)
STEPHEN E. CANTER, PRESIDENT SINCE MARCH 2000.
Chairman of the Board, Chief Executive Officer and Chief Operating Officer
of the Manager, and an officer of 95 investment companies (comprised of 190
portfolios) managed by the Manager. Mr. Canter also is a Board member and, where
applicable, an Executive Committee Member of the other investment management
subsidiaries of Mellon Financial Corporation, each of which is an affiliate of
the Manager. He is 57 years old and has been an employee of the Manager since
May 1995.
STEPHEN R. BYERS, EXECUTIVE VICE PRESIDENT SINCE NOVEMBER 2002.
Chief Investment Officer, Vice Chairman and a Director of the Manager, and
an officer of 95 investment companies (comprised of 190 portfolios) managed by
the Manager. Mr. Byers also is an Officer, Director or an Executive Committee
Member of certain other investment management subsidiaries of Mellon Financial
Corporation, each of which is an affiliate of the Manager. He is 49 years old
and has been an employee of the Manager since January 2000. Prior to joining the
Manager, he served as an Executive Vice President-Capital Markets, Chief
Financial Officer and Treasurer at Gruntal & Co., L.L.C.
MARK N. JACOBS, VICE PRESIDENT SINCE MARCH 2000.
Executive Vice President, Secretary and General Counsel of the Manager, and
an officer of 96 investment companies (comprised of 206 portfolios) managed by
the Manager. He is 57 years old and has been an employee of the Manager since
June 1977.
JOHN B. HAMMALIAN, SECRETARY SINCE MARCH 2000.
Associate General Counsel of the Manager, and an officer of 37 investment
companies (comprised of 46 portfolios) managed by the Manager. He is 39 years
old and has been an employee of the Manager since February 1991.
STEVEN F. NEWMAN, ASSISTANT SECRETARY SINCE MARCH 2000.
Associate General Counsel and Assistant Secretary of the Manager, and an
officer of 96 investment companies (comprised of 206 portfolios) managed by the
Manager. He is 53 years old and has been an employee of the Manager since July
1980.
MICHAEL A. ROSENBERG, ASSISTANT SECRETARY SINCE MARCH 2000.
Associate General Counsel of the Manager, and an officer of 93 investment
companies (comprised of 199 portfolios) managed by the Manager. He is 43 years
old and has been an employee of the Manager since October 1991.
JAMES WINDELS, TREASURER SINCE NOVEMBER 2001.
Director - Mutual Fund Accounting of the Manager, and an officer of 96
investment companies (comprised of 206 portfolios) managed by the Manager. He is
44 years old and has been an employee of the Manager since April 1985.
The Fund
OFFICERS OF THE FUND (Unaudited) (CONTINUED)
GREGORY S. GRUBER, ASSISTANT TREASURER SINCE MARCH 2000.
Senior Accounting Manager - Municipal Bond Funds of the Manager, and an
officer of 29 investment companies (comprised of 58 portfolios) managed by the
Manager. He is 44 years old and has been an employee of the Manager since August
1981.
KENNETH J. SANDGREN, ASSISTANT TREASURER SINCE NOVEMBER 2001.
Mutual Funds Tax Director of the Manager, and an officer of 96 investment
companies (comprised of 206 portfolios) managed by the Manager. He is 48 years
old and has been an employee of the Manager since June 1993.
WILLIAM GERMENIS, ANTI-MONEY LAUNDERING COMPLIANCE OFFICER SINCE OCTOBER 2002.
Vice President and Anti-Money Laundering Compliance Officer of the
Distributor, and the Anti-Money Laundering Compliance Officer of 91 investment
companies (comprised of 201 portfolios) managed by the Manager. He is 32 years
old and has been an employee of the Distributor since October 1998. Prior to
joining the Distributor, he was a Vice President of Compliance Data Center, Inc
NOTES
For More Information
Dreyfus
California Tax Exempt
Bond Fund, Inc.
200 Park Avenue
New York, NY 10166
Manager
The Dreyfus Corporation
200 Park Avenue
New York, NY 10166
Custodian
The Bank of New York
100 Church Street
New York, NY 10286
Transfer Agent &
Dividend Disbursing Agent
Dreyfus Transfer, Inc.
200 Park Avenue
New York, NY 10166
Distributor
Dreyfus Service Corporation
200 Park Avenue
New York, NY 10166
To obtain information:
BY TELEPHONE
Call 1-800-645-6561
BY MAIL Write to:
The Dreyfus Family of Funds
144 Glenn Curtiss Boulevard
Uniondale, NY 11556-0144
BY E-MAIL Send your request
to info@dreyfus.com
ON THE INTERNET Information
can be viewed online or
downloaded from:
http://www.dreyfus.com
(c) 2003 Dreyfus Service Corporation 928AR0503
ITEM 2. CODE OF ETHICS.
Not applicable.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not applicable.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not applicable.
ITEM 5. [RESERVED]
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) Based on an evaluation of the Disclosure Controls and Procedures (as
defined in Rule 30a-2(c) under the Investment Company Act of 1940, the
"Disclosure Controls") as of a date within 90 days prior to the filing date
(the "Filing Date") of this Form N-CSR (the "Report"), the Disclosure
Controls are effectively designed to ensure that information required to be
disclosed by the Registrant in the Report is recorded, processed, summarized
and reported by the Filing Date, including ensuring that information required
to be disclosed in the Report is accumulated and communicated to the
Registrant's management, including the Registrant's principal executive
officer and principal financial officer, as appropriate to allow timely
decisions regarding required disclosure.
(b) There were no significant changes in the Registrant's internal controls
or in other factors that could significantly affect these controls subsequent
to the date of their evaluation, and there were no corrective actions with
regard to significant deficiencies and material weaknesses.
ITEM 10. EXHIBITS.
(a) Not applicable.
(b)(1) Certifications of principal executive officer and principal
financial officer as required by Rule 30a-2 under the Investment Company Act
of 1940.
(PAGE)
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.
DREYFUS CALIFORNIA TAX EXEMPT BOND FUND, INC.
By: /s/STEPHEN E. CANTER
Stephen E. Canter
President
Date: July 30, 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: /s/ STEPHEN E. CANTER
Stephen E. Canter
Chief Executive Officer
Date: July 30, 2003
By: /s/JAMES WINDELS
James Windels
Chief Financial Officer
Date: July 30, 2003
EXHIBIT INDEX
(b)(1) Certifications of principal executive officer and
principal financial officer as required by Rule 30a-2 under the
Investment Company Act of 1940.
(b)(2) Certification of principal executive officer and
principal financial officer as required by Section 906 of the
Sarbanes-Oxley Act of 2002.