As filed with the Securities and Exchange Commission on July 7, 2005
Investment Company Act file number 811-3955
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF
REGISTERED MANAGEMENT INVESTMENT COMPANIES
NEW YORK DAILY TAX FREE INCOME FUND, INC.
(Exact name of registrant as specified in charter)
600 FIFTH AVENUE
NEW YORK, NY 10020
(Address of principal executive offices) (Zip code)
ROSANNE HOLTZER
C/O REICH & TANG ASSET MANAGEMENT, LLC
600 FIFTH AVENUE
NEW YORK, NEW YORK 10020
(Name and address of agent for service)
Registrant's telephone number, including area code: 212-830-5200
Date of fiscal year end: April 30
Date of reporting period: April 30, 2005
ITEM 1: REPORT TO STOCKHOLDERS
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NEW YORK 600 Fifth Avenue
DAILY TAX FREE New York, NY 10020
INCOME FUND, INC. (212)830-5200
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Dear Shareholder:
We are pleased to present the annual report of New York Daily Tax Free Income
Fund, Inc. (the "Fund") for the year ended April 30, 2005.
The Fund had net assets of $440,512,696 and 2,718 active shareholders as of
April 30, 2005.
We thank you for your support and look forward to continuing to serve your cash
management needs.
Sincerely,
\s\Steven W. Duff
Steven W. Duff
President
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NEW YORK DAILY TAX FREE INCOME FUND, INC.
EXPENSE CHART
FOR THE SIX MONTHS ENDED APRIL 30, 2005
(UNAUDITED)
================================================================================
As a shareholder of the Fund, you incur the following ongoing costs: management
fees and other Fund expenses. You may also incur distribution and/or service
(12b-1) fees.
This example is intended to help you understand your ongoing costs (in dollars)
of investing in the Fund and to compare these costs with the ongoing costs of
investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of the
period and held for the entire period November 1, 2004 through April 30, 2005.
ACTUAL EXPENSES
The first line of the table below provides information about actual account
values and actual expenses. You may use information in this line, together with
the amount you invested, to estimate the expenses that you paid over the period.
Simply divide your account value by $1,000 (for example, an $8,600 account value
divided by $1,000 = 8.6), then multiply the result by the number in the first
line under the heading entitled "Expenses Paid During the Period" to estimate
the expenses you paid on your account during this period.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The second line of the table below provides information about hypothetical
account values and hypothetical expenses based on the Fund's actual expense
ratio and an assumed rate of return of 5% per year before expenses, which is not
the Fund's actual return. The hypothetical account values and expenses may not
be used to estimate the actual ending account balance or expenses you paid for
the period. You may use this information to compare the ongoing costs of
investing in the Fund and other funds. To do so, compare this 5% hypothetical
example with the 5% hypothetical examples that appear in the shareholder reports
of the other funds.
Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transactional costs, such as sales
charges (loads), redemption fees, or exchange fees that you may incur in other
mutual funds. Therefore, the second line of the table is useful in comparing
ongoing costs only, and will not help you determine the relative total costs of
owning different funds.
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================================================================================
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Beginning Account Value Ending Account Value Expenses Paid During the Period*
Class A & Victory Shares 11/1/04 4/30/05
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Actual $1,000.00 $1,005.00 $4.28
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Hypothetical (5% return before $1,000.00 $1,020.53 $4.31
expenses)
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Beginning Account Value Ending Account Value Expenses Paid During the Period*
Class B 11/1/04 4/30/05
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Actual $1,000.00 $1,006.00 $3.28
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Hypothetical (5% return before $1,000.00 $1,021.52 $3.31
expenses)
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Beginning Account Value Ending Account Value Expenses Paid During the Period*
Advantage Shares 11/1/04 4/30/05
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Actual $1,000.00 $1,004.30 $4.92
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Hypothetical (5% return before $1,000.00 $1,019.89 $4.96
expenses)
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* Expenses are equal to the Fund's annualized expense ratios of 0.86%, 0.66%,
and 0.99%, for the Class A and Victory shares, Class B, and Advantage Shares,
respectively, multiplied by the average account value over the period (November
1, 2004 through April 30, 2005), multiplied by 181/365 (to reflect the most
recent fiscal half-year).
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NEW YORK DAILY TAX FREE INCOME FUND, INC.
STATEMENT OF NET ASSETS
APRIL 30, 2005
================================================================================
Ratings (a)
-----------
Face Maturity Value Standard
Amount Date Yield (Note 1) Moody's & Poor's
------ ---- ----- ------ ------- --------
Put Bond (b) (0.28%)
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<s> <c> <c> <c> <c> <c>
$ 1,250,000 New York State Dormitory Authority RB
(Columbia University) - Series A-2 (c) 06/08/05 1.60% $ 1,250,000
- ------------- ------------
1,250,000 Total Put Bond 1,250,000
- ------------- ------------
Tax Exempt Commercial Paper (3.72%)
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$ 9,000,000 New York City, NY MTA Transportation Facilities BAN - Series 1998B
LOC ABN AMRO Bank N.A. 06/15/05 2.35% $ 9,000,000 P1 A1+
2,400,000 New York State Environmental Quality - Series 1997A
LOC Bayerische Landesbank/ Landesbank Hessen 05/17/05 1.95 2,400,000 P1 A1+
5,000,000 New York State Dormitory Authority (Columbia Univesity)
- Series C 06/09/05 2.35 5,000,000 A1+
- ------------- ------------
16,400,000 Total Tax Exempt Commercial Paper 16,400,000
- ------------- ------------
Tax Exempt General Obligation Notes & Bonds (19.15%)
- ------------------------------------------------------------------------------------------------------------------------------------
$ 3,425,000 City School District of Albany, NY BAN (c) 06/30/05 2.20% $ 3,428,041
2,400,000 Cobleskill - Richmondville, NY CSD RAN - Series 2004 (c) 06/24/05 1.75 2,404,360
3,350,000 Ellicottville, NY CSD BAN (c) 06/16/05 1.70 3,354,357
4,045,000 Grand Island, NY BAN - Series 2004 (c) 07/21/05 1.60 4,045,351
8,940,000 Herricks Union School District, NY BAN (c) 12/01/05 2.05 8,995,181
7,611,500 Jamesville - Dewitt, NY CSD BAN - Series A 09/08/05 1.67 7,646,948 A1
3,670,000 Johnson City, NY BAN (c) 05/27/05 1.70 3,672,702
5,585,000 Kinderhook, NY CSD BAN - Series 2004 (c) 07/01/05 1.70 5,586,829
7,670,000 New York & New Jersey ABN AMRO Municipal TOPS
Certificates Trust - Series 2002-33
LOC Dexia CLF 07/06/05 2.08 7,670,000 VMIG-1
5,700,000 Penn Yan, NY CSD BAN (c) 06/21/05 1.70 5,708,219
5,000,000 Pittsford, NY CSD BAN - Series 2004 (c) 10/14/05 1.80 5,026,793
1,000,000 Remsenburg - Speonk,
NY Union Free School District TAN - Series 2004 (c) 06/30/05 2.00 1,000,812
4,500,000 Salmon River, NY CSD BAN - Series 2004 (c) 06/24/05 1.70 4,503,598
9,000,000 Suffolk County, NY BOCES RAN (First Supervisory District)
- 2004 (c) 06/28/05 1.75 9,016,397
9,467,700 Tully, NY CSD BAN - Series 2004 (c) 06/30/05 1.68 9,471,062
2,815,000 Yorktown, NY CSD BAN - Series 2004 (c) 07/15/05 1.63 2,821,369
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84,179,200 Total Tax Exempt General Obligation Notes & Bonds 84,352,019
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The accompanying notes are an integral part of these financial statements.
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================================================================================
Ratings (a)
-----------
Face Maturity Value Standard
Amount Date Yield (Note 1) Moody's & Poor's
------ ---- ----- ------ ------- --------
Variable Rate Demand Instruments (d) (75.60%)
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<s> <c> <c> <c> <c> <c>
$ 5,000,000 Commonwealth of Puerto Rico
Public Improvement Bonds TOCs - Series 2001
Insured by FSA 07/01/19 3.00% $ 5,000,000 A1+
2,000,000 Dutchess County, NY IDA (Marist College) - Series A
LOC Bank of New York 07/01/35 3.00 2,000,000 A1+
1,200,000 Dutchess County, NY IDA Civic Facilities RB
(Trinity - Pawling School Corporation)
LOC Allied Irish Bank 10/01/32 3.00 1,200,000 VMIG-1
2,300,000 Erie County, NY IDA (Hauptman - Woodard Project) - Series 2004 (c)
LOC Key Bank, N.A. 03/01/24 3.07 2,300,000
1,000,000 Islip, NY IDA RB (Brentwood Distributor Co. Facility) - Series 1984 (c)
LOC Fleet Bank 05/01/09 2.98 1,000,000
10,000,000 Jay Street Development Corporation, NY
(Cort Facility Lease Revenue) - Series A-3
LOC Depfa Bank PLC 05/01/22 2.92 10,000,000 VMIG-1 A1+
24,250,000 Long Island Power Authority, NY RB (Electric System) -
Series 7, Subseries 7-B
Insured by MBIA Insurance Corp. 04/01/25 3.00 24,250,000 VMIG-1 A1+
2,500,000 Monroe County, NY IDA - Series A
LOC Wachovia Bank & Trust Company, N.A. 06/01/29 2.95 2,500,000 VMIG-1
1,125,000 New York City, NY IDA Civic Facilities (MSMC Realty Corporation Project)
LOC JPMorgan Chase & Co. 01/01/31 2.97 1,125,000 VMIG-1 A1+
2,400,000 New York City, NY HDC (Manhattan Court Development) - Series 2004A
LOC Citibank 06/01/36 2.95 2,400,000 A1+
3,200,000 New York City, NY - Series 2004, Subseries H-8
LOC Westdeutsche Landesbank 03/01/34 2.94 3,200,000 VMIG-1 A1
9,000,000 New York City, NY - Subseries H-6
LOC Fleet Bank 03/01/34 3.00 9,000,000 VMIG-1 A1
2,000,000 New York City, NY (West End Towers) - Series 2004
Guaranteed by Federal National Mortgage Association 05/15/34 3.00 2,000,000 P1 A1
2,350,000 New York City, NY GO - Series F-3
LOC Morgan Guaranty Trust Company 02/15/13 3.00 2,350,000 VMIG-1 A1+
4,500,000 New York City, NY GO - Series H-4
Insured by AMBAC Indemnity Corp. 08/01/15 2.98 4,500,000 VMIG-1 A1
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The accompanying notes are an integral part of these financial statements.
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NEW YORK DAILY TAX FREE INCOME FUND, INC.
STATEMENT OF NET ASSETS (CONTINUED)
APRIL 30, 2005
================================================================================
Ratings (a)
-----------
Face Maturity Value Standard
Amount Date Yield (Note 1) Moody's & Poor's
------ ---- ----- ------ ------- --------
Variable Rate Demand Instruments (d) (Continued)
- ------------------------------------------------------------------------------------------------------------------------------------
<s> <c> <c> <c> <c> <c>
$ 4,000,000 New York City, NY GO - Series J, Subseries J-2
LOC Westdeutsche Landesbank 02/15/16 2.99% $ 4,000,000 VMIG-1 A1+
1,500,000 New York City, NY GO Trust Receipts SGB33 - Series 1 1996F
Insured by FSA 02/01/19 3.02 1,500,000 A1+
1,300,000 New York City, NY HDC (Columbus Apartment Project) - Series 1995A
Collateralized by Federal National Mortgage Association 03/15/25 3.00 1,300,000 A1+
5,800,000 New York City, NY HDC Residential RB
(Montefiore Medical Center) - Series 1993A
LOC Chase Manhattan Bank, N.A. 05/01/30 3.00 5,800,000 A1
1,000,000 New York City, NY Housing (West 48th Street Development) - Series A
Guaranteed by Federal National Mortgage Association 01/15/34 3.00 1,000,000 A1+
1,820,000 New York City, NY IDA Civic Facilities RB
(Epiphany Community Nursery School Project) - Series 1997
LOC Bank of New York 05/01/11 3.09 1,820,000 VMIG-1
4,725,000 New York City, NY IDA Civic Facilities RB
(American Society Technion Project)
LOC Allied Irish Bank 10/01/33 2.98 4,725,000 VMIG-1
23,900,000 New York City, NY IDA Civic Facilities RB
(Center for Jewish History)
LOC Bank of America 09/01/31 2.98 23,900,000 VMIG-1
3,865,000 New York City, NY IDA Civic Facilities RB
(Convent Sacred Heart School)
LOC Allied Irish Bank 11/01/32 3.03 3,865,000 VMIG-1
17,900,000 New York City, NY IDA Special Facility RB
(Korean Airlines Company Limited Project) - Series 1997B
LOC Rabobank Nederland 11/01/24 3.03 17,900,000 VMIG-1 A1+
1,586,600 New York City, NY IDRB (Abigal Press Inc., Project) - Series 2002
LOC JPMorgan Chase & Co. 12/01/18 3.04 1,586,600 A1+
2,700,000 New York City, NY MHRB (Peter Cintron Apartments) - Series C
LOC Key Bank, N.A. 06/15/37 2.98 2,700,000 A1
5,700,000 New York City, NY MHRB (941 Hoe Avenue Apartment)
LOC Key Bank, N.A. 06/15/37 2.98 5,700,000 A1
10,000,000 New York City, NY MTA RB - Series G-1
Insured by AMBAC Indemnity Corp. 11/01/26 2.92 10,000,000 VMIG-1 A1+
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The accompanying notes are an integral part of these financial statements.
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================================================================================
Ratings (a)
-----------
Face Maturity Value Standard
Amount Date Yield (Note 1) Moody's & Poor's
------ ---- ----- ------ ------- --------
Variable Rate Demand Instruments (d) (Continued)
- ------------------------------------------------------------------------------------------------------------------------------------
<s> <c> <c> <c> <c> <c>
$ 5,000,000 New York City, NY Municipal Water Finance Authority RB
Municipal Securities Trust Receipts
Insured by MBIA Insurance Corp. 06/15/23 3.02% $ 5,000,000 A1+
5,000,000 New York City, NY Trust for Cultural Resources
(The Museum of Broadcasting)
LOC KBC Bank 05/01/14 2.96 5,000,000 VMIG-1 A1+
1,828,500 New York City, NY Trust for Cultural Resources - Series 950
Insured by FGIC 02/01/34 3.01 1,828,500 VMIG-1
4,015,000 New York City, NY Trust for Cultural Resources
(Carnegie Hall) - Series 1990
LOC Depfa Bank PLC 12/01/15 3.00 4,015,000 VMIG-1 A1+
12,155,000 New York State Development Corporation (Eagle) 07/01/16 3.02 12,155,000 A1+
990,000 New York State Dormitory Authority (Merlots) - Series A30
Insured by AMBAC Indemnity Corp. 02/15/18 3.06 990,000 VMIG-1
3,000,000 New York State Dormitory Authority RB (Wagner College Project)
LOC Morgan Guaranty Trust Company 07/01/28 2.99 3,000,000 A1+
2,500,000 New York State Dormitory Authority RB
(Columbia University) - Series B 07/01/28 2.92 2,500,000 VMIG-1 A1+
2,000,000 New York State Dormitory Authority RB
(Cornell University) - Series A 07/01/29 2.92 2,000,000 A1+
4,580,000 New York State Dormitory Authority RB (Public Library) - Series A
Insured by MBIA Insurance Corp. 07/01/28 3.00 4,580,000 VMIG-1 A1
12,000,000 New York State HFA (Normandie Court II project) - Series A
Guaranteed by Federal Home Loan Mortgage Corporation 11/01/29 3.00 12,000,000 VMIG-1
1,300,000 New York State HFA RB (Saville Housing) - Series A
LOC Fleet Bank 11/01/35 3.00 1,300,000 VMIG-1
3,000,000 New York State HFA RB (Saxony Housing) - Series 1997A
Collateralized by Federal National Mortgage Association 05/15/30 3.00 3,000,000 VMIG-1
4,000,000 New York State HFA RB (Union Square Housing)
Guaranteed by Federal National Mortgage Association 05/15/24 3.03 4,000,000 VMIG-1
11,300,000 New York State HFA RB - Series A
Guaranteed by Federal National Mortgage Association 05/01/29 3.03 11,300,000 VMIG-1
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The accompanying notes are an integral part of these financial statements.
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NEW YORK DAILY TAX FREE INCOME FUND, INC.
STATEMENT OF NET ASSETS (CONTINUED)
APRIL 30, 2005
================================================================================
Ratings (a)
-----------
Face Maturity Value Standard
Amount Date Yield (Note 1) Moody's & Poor's
------ ---- ----- ------ ------- --------
Variable Rate Demand Instruments (d) (Continued)
- ------------------------------------------------------------------------------------------------------------------------------------
<s> <c> <c> <c> <c> <c>
$ 4,000,000 New York State Housing Finance Agency (Helena Housing) - Series A
LOC Fleet Bank 11/01/36 3.03% $ 4,000,000 VMIG-1
1,750,000 New York State Housing Finance Agency RB
(Archstone Westbury) - Series A
LOC JPMorgan Chase & Co. 11/01/36 3.04 1,750,000 VMIG-1
1,675,000 New York State, Housing Finance Agency RB
(Avalonchrystie Place I Project) - Series 2004-A
LOC Fleet Bank 11/01/36 2.98 1,675,000 VMIG-1
10,200,000 New York State Local Government Assistance Corporation Series 1994B
LOC Westdeutsche Landesbank / Bayerische Landesbank 04/01/23 2.95 10,200,000 VMIG-1 A1+
4,800,000 New York State Local Government Assistance Corporation Series 1995D
LOC Societe Generale 04/01/25 2.93 4,800,000 VMIG-1 A1+
12,700,000 New York State Local Government Assistance Corporation Series 1995F
LOC Societe Generale 04/01/25 2.95 12,700,000 VMIG-1 A1+
9,500,000 New York State Local Government Assistance Corporation Series 4V
Insured by FSA 04/01/22 2.96 9,500,000 A1+
2,000,000 New York State Local Government Assistance Corporation Series 8V
Insured by FSA 04/01/19 2.95 2,000,000 A1+
3,300,000 New York State Local Government Assistance Corporation Series A-7V
Insured by FGIC 04/01/20 2.95 3,300,000 VMIG-1 A1+
900,000 New York State Local Government Assistance Corporation Series B
LOC Bank of Nova Scotia 04/01/25 2.89 900,000 VMIG-1 A1+
6,200,000 New York State Local Government Assistance Corporation Series C
LOC Landesbank Hessen 04/01/25 2.89 6,200,000 VMIG-1 A1+
3,600,000 New York State Local Government Assistance Corporation
Series G
LOC Bank of Nova Scotia 04/01/25 2.96 3,600,000 VMIG-1 A1
4,600,000 New York State MHRB (Normandie Court I Project) - Series 1
LOC Landesbank Hessen 05/15/15 2.97 4,600,000 VMIG-1 A1+
4,550,000 New York StateThruway Authority
(Highway & Bridge Trust Fund) ROCs RR II R4506
Insured by AMBAC Indemnity Corp. 04/01/19 3.02 4,550,000 A1+
5,000,000 New York Triborough Bridge & Tunnel Authority BAN - Series C
Insured by AMBAC Indemnity Corp. 01/01/32 2.99 5,000,000 VMIG-1 A1+
8,900,000 New York Triborough Bridge & Tunnel Authority - Series C
Insured by AMBAC Indemnity Corp. 01/01/33 3.00 8,900,000 VMIG-1 A1+
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The accompanying notes are an integral part of these financial statements.
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================================================================================
Ratings (a)
-----------
Face Maturity Value Standard
Amount Date Yield (Note 1) Moody's & Poor's
------ ---- ----- ------ ------- --------
Variable Rate Demand Instruments (d) (Continued)
- ------------------------------------------------------------------------------------------------------------------------------------
<s> <c> <c> <c> <c> <c>
$ 1,500,000 New York State Energy Research & Development Authority
(Con Edison) - Subseries C-3
LOC Citibank 11/01/39 3.04% $ 1,500,000 VMIG-1 A1+
4,000,000 Port Authority of New York and New Jersey ROB/INS
Trust Receipts Class F - Series 10
Insured by FSA 01/15/17 2.99 4,000,000 VMIG-1 A1+
2,000,000 Puerto Rico Commonwealth - PA 625
Insured by AMBAC Indemnity Corp. 07/01/10 2.99 2,000,000 A1+
1,135,000 Puerto Rico HFC (Eagle) - Series 2000-C5102
Insured by AMBAC Indemnity Corp. 10/01/11 3.09 1,135,000 A1+
2,000,000 Puerto Rico Infrastrucuture Financing Authority
(Eagle Trust) - Series 2001 (c) 10/01/34 3.00 2,000,000
3,400,000 Puerto Rico PFC P-Floats PA 783 10/01/19 2.99 3,400,000 A1+
4,000,000 Triborough Building & Tunnel Authority General - Series F 11/01/32 3.00 4,000,000 VMIG-1 A1+
- ------------- ------------
333,000,100 Total Variable Rate Demand Instruments 333,000,100
- ------------- ------------
Variable Rate Demand Instrument - Private Placement (d) (0.68%)
- ------------------------------------------------------------------------------------------------------------------------------------
$ 3,000,000 Orange County, NY IDA IDRB (1986 Blaser Real Estate Inc. Project)
LOC Union Bank of Switzerland 09/01/21 3.73% $ 3,000,000 P1 A1+
- ------------- ------------
3,000,000 Total Variable Rate Demand Instrument - Private Placement 3,000,000
- ------------- ------------
Total Investments (99.43%) (Cost $438,002,119+) $438,002,119
Cash and other assets, net of liabilities (0.57%) 2,510,577
------------
Net Assets (100.00%) $440,512,696
============
Net Asset Value, offering and redemption price per share:
Class A, 283,146,355 shares outstanding (Note 3) $ 1.00
============
Class B, 39,832,582 shares outstanding (Note 3) $ 1.00
============
Victory Shares, 45,987,327 shares outstanding (Note 3) $ 1.00
============
Advantage Shares, 71,566,050 shares outstanding (Note 3) $ 1.00
============
<FN>
+ Aggregate cost for income tax purposes is identical.
</FN>
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The accompanying notes are an integral part of these financial statements.
- --------------------------------------------------------------------------------
NEW YORK DAILY TAX FREE INCOME FUND, INC.
STATEMENT OF NET ASSETS (CONTINUED)
APRIL 30, 2005
================================================================================
FOOTNOTES:
(a) Unless the variable rate demand instruments are assigned their own ratings,
the ratings are those of the holding company of the bank whose letter of
credit guarantees the issue or the insurance company who insures the issue.
All letters of credit and insurance are irrevocable and direct pay covering
both principal and interest. Ratings are unaudited.
In addition, certain issuers have either aline of credit, a liquidity
facility, a standby purchase agreement or some other financing mechanism to
ensure the remarketing of the securities. This is not a guarantee and does
not serve to insure or collateralize the issue.
(b) The maturity date indicated is the next put date.
(c) Securities that are not rated that the Adviser has determined to be of
comparable quality to those rated securities in which the Fund invests.
(d) Securities payable on demand at par including accrued interest (usually
with seven days' notice) and where indicated are unconditionally secured as
to principal and interest by a bank letter of credit. The interest rates
are adjustable and are based on bank prime rates or other interest rate
adjustment indices. The rate shown is the rate in effect at the date of
this statement.
KEY:
BAN = Bond Anticipation Note MHRB = Multi-Family Revenue Housing Bond
CSD = Central School District MTA = Metropolitan Transit Authority
FGIC = Financial Guaranty Insurance Company PFC = Public Finance Corporation
FSA = Financial Security Assurance RAN = Revenue Anticipation Note
GO = General Obligation RB = Revenue Bond
HDC = Housing Development Corporation ROB/INS = Reverse Option Bond / Inverse Securities
HFA = Housing Finance Authority ROCS = Reset Option Certificates
HFC = Housing Finance Commission TAN = Tax Anticipation Note
IDA = Industrial Development Authority TOCs = Tender Option Certificates
IDRB = Industrial Development Revenue Bond TOPS = Tender Option Puts
LOC = Letter of Credit
BREAKDOWN OF PORTFOLIO HOLDINGS BY STATE:
- --------------------------------------------------------------------------------
State Value % of Portfolio
- --------------------------------------------------------------------------------
New York $424,467,119 96.91%
Puerto Rico 13,535,000 3.09
- --------------------------------------------------------------------------------
Total $438,002,119 100.00%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
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NEW YORK DAILY TAX FREE INCOME FUND, INC.
STATEMENT OF OPERATIONS
YEAR ENDED APRIL 30, 2005
================================================================================
INVESTMENT INCOME
Income:
Interest.................................................................. $ 7,399,001
------------------
Expenses: (Note 2)
Investment management fee................................................. 1,429,148
Administration fee........................................................ 1,000,404
Distribution fee (Advantage Shares)....................................... 323,243
Shareholder servicing fee (Class A)....................................... 608,083
Shareholder servicing fee (Victory Shares)................................ 102,273
Shareholder servicing fee (Advantage Shares).............................. 179,580
Custodian expenses........................................................ 23,456
Shareholder servicing and related shareholder expenses+................... 248,853
Legal, compliance and filing fees......................................... 199,038
Audit and accounting...................................................... 143,367
Directors' fees and expenses.............................................. 21,311
Other expenses............................................................ 25,388
------------------
Total expenses......................................................... 4,304,144
Less: Expenses paid indirectly (Note 2)............................... (683)
Fees Waived (Note 2)............................................ (257,124)
------------------
Net expenses ............................................................. 4,046,337
------------------
Net investment income...................................................... 3,352,664
REALIZED GAIN (LOSS) ON INVESTMENTS
Net realized (loss) on investments......................................... (17,929)
------------------
Increase in net assets from operations..................................... $ 3,334,735
==================
+ Includes class specific transfer agency expenses of $152,021, $24,686 and
$25,568 for Class A, Class B and Victory Shares, respectively.
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The accompanying notes are an integral part of these financial statements.
- --------------------------------------------------------------------------------
NEW YORK DAILY TAX FREE INCOME FUND, INC.
STATEMENTS OF CHANGES IN NET ASSETS
YEARS ENDED APRIL 30, 2005 AND 2004
================================================================================
2005 2004
---------------- ----------------
INCREASE (DECREASE) IN NET ASSETS
Operations:
Net investment income......................................... $ 3,352,664 $ 1,053,212
Net realized gain (loss) on investments....................... (17,929) -0-
---------------- ----------------
Increase in net assets from operations........................ 3,334,735 1,053,212
Dividends to shareholders from net investment income *:
Class A....................................................... (2,114,974) (624,714)
Class B....................................................... (430,993) (193,709)
Victory Shares................................................ (355,460) (153,411)
Advantage Shares.............................................. (451,237) (81,378)
Capital share transactions (Note 3):
Class A....................................................... (13,725,723) (27,214,765)
Class B....................................................... (11,578,460) 4,445,274
Victory Shares................................................ (7,628,452) (26,167,129)
Advantage Shares.............................................. 34,880,420 (20,564,068)
---------------- ----------------
Total increase (decrease)................................. 1,929,856 (69,500,688)
Net assets:
Beginning of year............................................. 438,582,840 508,083,528
---------------- ----------------
End of year................................................... $ 440,512,696 $ 438,582,840
================ ================
Undistributed net investment income........................... $ -0- $ -0-
================ ================
<FN>
* Designated as exempt-interest dividends for regular federal income tax purposes.
</FN>
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
- --------------------------------------------------------------------------------
NEW YORK DAILY TAX FREE INCOME FUND, INC.
NOTES TO FINANCIAL STATEMENTS
================================================================================
1. Summary of Accounting Policies
New York Daily Tax Free Income Fund, Inc. (the "Fund") is a no-load,
non-diversified, open-end management investment company registered under the
Investment Company Act of 1940. The Fund is a short-term, tax exempt money
market fund. The Fund has four classes of stock authorized, Class A, Class B,
Victory and Advantage New York Tax Exempt Liquidity Fund Shares ("Advantage
Shares"). The Class A, Victory and Advantage Shares are subject to a service fee
pursuant to the Distribution and Service Plan. The Advantage Shares are also
subject to an additional distribution fee pursuant to a Shareholder Servicing
Agreement. The Class B shares are not subject to a service fee. Additionally,
the Fund may allocate among its classes certain expenses to the extent allowable
to specific classes, including transfer agent fees, government registration
fees, certain printing and postage costs, and certain administrative and legal
expenses. Class specific expenses of the Fund are limited to shareholder
servicing fees, distribution fees and transfer agent expenses. Income, expenses
(other than expenses attributable to a specific class), and realized and
unrealized gains or losses on investments are allocated to each class of shares
based on its relative net assets. In all other respects, all share classes
represent the same interest in the income and assets of the Fund. The Advantage
Shares commenced on November 22, 2002.
The Fund's financial statements are prepared in accordance with accounting
principles generally accepted in the United States of America for investment
companies as follows:
a) Valuation of Securities -
Investments are valued at amortized cost. Under this valuation method, a
portfolio instrument is valued at cost and any discount is accreted or
premium is amortized on a constant basis to the maturity of the instrument.
The maturity of variable rate demand instruments is deemed to be the longer
of the period required before the Fund is entitled to receive payment of
the principal amount or the period remaining until the next interest rate
adjustment.
b) Federal Income Taxes -
It is the Fund's policy to comply with the requirements of the Internal
Revenue Code applicable to regulated investment companies and to distribute
all of its tax exempt and taxable (if any) income to its shareholders.
Therefore, no provision for federal income tax is required.
c) Dividends and Distributions -
Dividends from investment income (excluding capital gains and losses, if
any, and amortization of market discount) are declared daily and paid
monthly. Distributions of net capital gains, if any, realized on sales of
investments are made after the close of the Fund's fiscal year, as declared
by the Fund's Board of Directors.
d) Use of Estimates -
The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires
management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the reported
amounts of increases and decreases in net assets from operations during the
reporting period. Actual results could differ from those estimates.
e) General -
Securities transactions are recorded on a trade date basis. Interest
income, including accretion of discount and amortization of premium, is
accrued as earned. Realized gains and losses from securities transactions
are recorded on the identified cost basis.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
NEW YORK DAILY TAX FREE INCOME FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
2. Investment Management Fees and Other Transactions with Affiliates
Under the Investment Management Contract, the Fund pays an investment management
fee to Reich & Tang Asset Management LLC (the "Manager"), equal to .30% of the
Fund's average daily net assets.
Pursuant to an Administrative Services Agreement, the Fund pays to the Manager
an annual fee of .21% of the Fund's average daily net assets.
Pursuant to the Fund's Distribution Plans adopted under Securities and Exchange
Commission Rule 12b-1, the Fund and Reich & Tang Distributors, Inc. (the
"Distributor"), an affiliate of the Manager, have entered into a Distribution
Agreement and a Shareholder Servicing Agreement, with respect to the Class A,
Victory and Advantage Shares of the Fund. For its services under the Shareholder
Servicing Agreement, the Distributor receives from the Fund a fee equal to .20%
of the Fund's average daily net assets with respect to the Class A and Victory
Shares and a service fee of .25% with respect to the Advantage Shares. In
addition for its services under the Distribution Agreement, the Distributor
receives .45% per annum in distribution fees of the Advantage Shares' average
daily net assets. There were no additional expenses borne by the Fund pursuant
to the Distribution Plan.
For the year ended April 30, 2005, the Distributor voluntarily waived the
following fees:
Distribution fees - Advantage Shares $ 77,544
Shareholder servicing fees - Advantage Shares 179,580
----------
Total fees waived $ 257,124
==========
The Distributor has no right to recoup prior waivers.
Fees are paid to Directors who are unaffiliated with the Manager on the basis of
$4,000 per annum plus $750 per meeting attended. Effective January 1, 2005,
Directors who are unaffiliated with the Manager will receive fees from the fund
of $7,000 per annum, plus a fee of $1,375 for each Board of Directors meeting
attended.
Included in the Statement of Operations under the caption "Shareholder servicing
and related shareholder expenses" are fees of $202,298 paid to Reich & Tang
Services, Inc., an affiliate of the Manager, as shareholder servicing agent for
the Fund.
For the year ended April 30, 2005, the Fund had expense offsets of $683 from
shareholder servicing and related shareholder expenses.
3. Capital Stock
At April 30, 2005, 20,000,000,000 shares of $.001 par value stock were
authorized. Transactions in capital stock, all at $1.00 per share, were as
follows:
Year Year
Ended Ended
April 30, 2005 April 30, 2004
--------------- --------------
Class A
- -------
Sold...................................... 1,180,832,049 1,016,942,018
Issued on reinvestment of dividends....... 1,148,123 414,212
Redeemed.................................. (1,195,705,895) (1,044,570,995)
--------------- --------------
Net increase (decrease)................... (13,725,723) (27,214,765)
=============== ==============
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
================================================================================
3. Capital Stock (Continued)
Year Year
Ended Ended
April 30, 2005 April 30, 2004
--------------- --------------
Class B
- -------
Sold...................................... 188,232,629 209,343,267
Issued on reinvestment of dividends....... 411,002 199,092
Redeemed.................................. ( 200,222,091) ( 205,097,085)
--------------- --------------
Net increase (decrease)................... (11,578,460) 4,445,274
=============== ==============
Victory Shares
- --------------
Sold...................................... 88,893,111 144,236,690
Issued on reinvestment of dividends....... 357,160 152,982
Redeemed.................................. (96,878,723) ( 170,556,801)
--------------- --------------
Net increase (decrease)................... (7,628,452) (26,167,129)
=============== ==============
Advantage Shares
- ----------------
Sold...................................... 166,028,545 175,147,776
Issued on reinvestment of dividends....... 422,774 87,245
Redeemed.................................. (131,570,899) (195,799,089)
--------------- --------------
Net increase (decrease)................... 34,880,420 (20,564,068)
=============== ==============
As of April 30, 2005, the breakdown of net assets
by share class were as follows:
Class A shares............................ $ 283,133,746
Class B shares............................ 39,830,808
Victory shares............................ 45,985,279
Advantage shares.......................... 71,562,863
---------------
Total.................................. $ 440,512,696
===============
4. Liabilities
At April 30, 2005, the Fund had the following
liabilities:
Fees payable to Affiliates*............... $ 229,660
Dividends payable......................... 225,494
Accrued other payables.................... 40,031
---------------
Total liabilities...................... $ 495,185
===============
* Includes fees payable to Reich & Tang Asset Management, LLC, Reich & Tang
Distributors, Inc. and Reich & Tang Services, Inc.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
NEW YORK DAILY TAX FREE INCOME FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
5. Tax Information
The tax character of all distributions paid during the years ended April 30,
2005 and 2004 were tax-exempt.
During the year ended April 30, 2005, as permitted under Federal income tax
regulation, the Fund elected to defer $25,523 of post-October net capital losses
to the next taxable year.
At April 30, 2005, the Fund had $7,595 of long-term distributable earnings.
6. Concentration of Credit Risk
The Fund invests primarily in obligations of political subdivisions of the State
of New York and, accordingly, is subject to the credit risk associated with the
non-performance of such issuers. Approximately 75% of these investments are
further secured, as to principal and interest, by credit enhancements such as
letters of credit, municipal bond insurance, and guarantees issued by financial
institutions. The Fund maintains a policy of monitoring its exposure by
reviewing the credit worthiness of the issuers, as well as, that of the
financial institutions issuing the credit enhancements, and by limiting the
amount of holdings with credit enhancements from one financial institution.
7. Financial Highlights
Year Ended April 30,
--------------------------------------------------------------
Class A 2005 2004 2003 2002 2001
- ------- ------ ------ ------- ------- ------
Per Share Operating Performance:
(for a share outstanding throughout the year)
Net asset value, beginning of year............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- ---------- ----------- ----------- ----------
Income from investment operations:
Net investment income....................... 0.007 0.002 0.006 0.012 0.031
Net realized and unrealized gain(loss)
on investment (0.000) -- 0.000 -- --
---------- ---------- ----------- ----------- ----------
Total from investment operations............ 0.007 0.002 0.006 0.012 0.031
Less distributions:
Dividends from net investment income........ (0.007) (0.002) (0.006) (0.012) (0.031)
Net realized gain on investment............. -- -- (0.000) -- --
---------- ---------- ----------- ----------- ----------
Total distributions......................... (0.007) (0.002) (0.006) (0.012) (0.031)
---------- ---------- ----------- ----------- ----------
Net asset value, end of year................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
========== ========== =========== =========== ==========
Total Return................................... 0.70% 0.21% 0.59% 1.23% 3.11%
Ratios/Supplemental Data
Net assets, end of year (000).................. $ 283,134 $ 296,871 $ 324,086 $ 343,895 $ 406,791
Ratios to average net assets:
Expenses (a)................................ 0.86% 0.83% 0.82% 0.85% 0.87%
Net investment income....................... 0.70% 0.21% 0.59% 1.27% 3.03%
Expenses paid indirectly.................... 0.00% 0.00% 0.00% 0.00% 0.00%
<FN>
(a) Includes expenses paid indirectly
</FN>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
================================================================================
7. Financial Highlights (Continued)
Year Ended April 30,
--------------------------------------------------------------
Class B 2005 2004 2003 2002 2001
- ------- ------ ------ ------- ------- ------
Per Share Operating Performance:
(for a share outstanding throughout the year)
Net asset value, beginning of year............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- ---------- ----------- ----------- ----------
Income from investment operations:
Net investment income....................... 0.009 0.004 0.008 0.015 0.033
Net realized and unrealized gain(loss)
on investment (0.000) -- 0.000 -- --
---------- ---------- ----------- ----------- ----------
Total from investment operations............ 0.009 0.004 0.008 0.015 0.033
Less distributions:
Dividends from net investment income........ (0.009) (0.004) (0.008) (0.015) (0.033)
Net realized gain on investment............. -- -- (0.000) -- --
---------- ---------- ----------- ----------- ----------
Total distributions......................... (0.009) (0.004) (0.008) (0.015) (0.033)
---------- ---------- ----------- ----------- ----------
Net asset value, end of year................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
========== ========== =========== =========== ==========
Total Return................................... 0.90% 0.41% 0.79% 1.46% 3.37%
Ratios/Supplemental Data
Net assets, end of year (000).................. $ 39,831 $ 51,411 $ 46,966 $ 50,441 $ 45,149
Ratios to average net assets:
Expenses (a)................................ 0.66% 0.63% 0.61% 0.62% 0.62%
Net investment income....................... 0.88% 0.40% 0.77% 1.44% 3.31%
Expenses paid indirectly.................... 0.00% 0.00% 0.00% 0.00% 0.00%
Year Ended April 30,
-------------------------------------------------------------
Victory Shares 2005 2004 2003 2002 2001
- -------------- ------ ------ ------ ------- -------
Per Share Operating Performance:
(for a share outstanding throughout the year)
Net asset value, beginning of year............. $ 1.00 $ 1.00 $ 1.00 $1.00 $ 1.00
---------- ---------- ----------- ---------- ----------
Income from investment operations:
Net investment income....................... 0.007 0.002 0.006 0.012 0.031
Net realized and unrealized gain(loss)
on investment (0.000) -- 0.000 -- --
---------- ---------- ----------- ----------- ----------
Total from investment operations............ 0.007 0.002 0.006 0.012 0.031
Less distributions:
Dividends from net investment income........ (0.007) (0.002) (0.006) (0.012) (0.031)
Net realized gain on investment............. -- -- (0.000) -- --
---------- ---------- ----------- ----------- ----------
Total distributions......................... (0.007) (0.002) (0.006) (0.012) (0.031)
---------- ---------- ----------- ----------- ----------
Net asset value, end of year................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
========== ========== =========== =========== ==========
Total Return................................... 0.70% 0.21% 0.59% 1.23% 3.11%
Ratios/Supplemental Data
Net assets, end of year (000).................. $ 45,985 $ 53,616 $ 79,783 $ 89,963 $ 78,428
Ratios to average net assets:
Expenses (a)................................ 0.86% 0.83% 0.82% 0.85% 0.87%
Net investment income....................... 0.70% 0.21% 0.59% 1.27% 3.03%
Expenses paid indirectly.................... 0.00% 0.00% 0.00% 0.00% 0.00%
<FN>
(a) Includes expenses paid indirectly
</FN>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
NEW YORK DAILY TAX FREE INCOME FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
7. Financial Highlights (Continued)
Year Ended April 30, November 22, 2002
---------------------------- (Commencement of Offering) to
Advantage Shares 2005 2004 April 30, 2003
---------------- ------ ------- --------------
Per Share Operating Performance:
(for a share outstanding throughout the period)
Net asset value, beginning of period........... $ 1.00 $ 1.00 $1.00
---------- ----------- --------------
Income from investment operations:
Net investment income.......................... 0.006 0.001 0.001
Net realized and unrealized gain(loss)
on investments (0.000) -- 0.000
---------- ----------- --------------
Total from investment operations 0.006 0.001 0.001
Less distributions from:
Dividends from net investment income........... (0.006) (0.001) (0.001)
Net realized gains on investments.............. -- -- (0.000)
---------- ----------- --------------
Total distributions............................ (0.006) (0.001) (0.001)
---------- ----------- --------------
Net asset value, end of period................. $ 1.00 $ 1.00 $ 1.00
========== =========== ==============
Total Return................................... 0.61% 0.15% 0.15%(a)
Ratios/Supplemental Data
Net assets, end of period (000)................ $ 71,563 $ 36,685 $ 57,249
Ratios to average net assets:
Expenses (b) (net of fees waived)............. 0.95% 0.89% 0.90%(c)
Net investment income......................... 0.63% 0.14% 0.33%(c)
Expenses paid indirectly...................... 0.00% 0.00% 0.00%(c)
Distribution and shareholder servicing fees waived 0.36% 0.39% 0.37%(c)
<FN>
(a) Not annualized
(b) Includes expenses paid indirectly
(c) Annualized
</FN>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
NEW YORK DAILY TAX FREE INCOME FUND, INC.
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
================================================================================
To the Board of Directors and Shareholders of
New York Daily Tax Free Income Fund, Inc.
In our opinion, the accompanying statement of net assets and the related
statements of operations and of changes in net assets and the financial
highlights present fairly, in all material respects, the financial position of
New York Daily Tax Free Income Fund, Inc. (the "Fund") at April 30, 2005, the
results of its operations for the year then ended, the changes in its net assets
for each of the two years in the period then ended and the financial highlights
for each of the periods 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). Those standards
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 April 30, 2005 by correspondence with the
custodian, provide a reasonable basis for our opinion.
PricewaterhouseCoopers LLP
New York, New York
June 13, 2005
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
NEW YORK DAILY TAX FREE INCOME FUND, INC.
ADDITIONAL INFORMATION
(UNAUDITED)
================================================================================
ADDITIONAL INFORMATION ABOUT PORTFOLIO HOLDINGS
The Fund is required to file its complete schedule of portfolio holdings with
the Securities and Exchange Commission ("SEC") on Form N-Q for its first and
third fiscal quarters. The Fund's Form N-Q is available without charge on the
SEC's website (http://www.sec.gov) or by calling the Fund toll free at (800)
433-1918. You can also obtain copies of the Fund's Form N-Q by visiting the
SEC's Public Reference Room in Washington, DC (please call the SEC at (800)
732-0330 for information on the operation of the Public Reference Room).
INFORMATION ABOUT PROXY VOTING
Information regarding the Fund's proxy voting record for the 12 month period
ending June 30 of each year is filed with the SEC on Form N-PX no later than
August 31 of each year. The Fund's Form N-PX is available without charge, upon
request, by calling the Fund at (800) 433-1918 and on the SEC's website
(http//www.sec.gov). The Fund does not presently invest in voting securities and
has therefore not adopted proxy voting policies and procedures.
INFORMATION ABOUT THE INVESTMENT MANAGEMENT CONTRACT
On March 8, 2005, the Board of Directors approved the continuance of the
Investment Management Contract. In determining whether to approve the
continuance of the Investment Management Contract, the Directors considered the
following information:
1) The nature, extent and quality of services provided by the Manager.
The Directors reviewed in detail the nature and extent of the services provided
by the Manager under the terms of the Fund's Investment Management Contract and
the quality of those services over the past year. The Directors noted that the
services include managing the investment and reinvestment of the Fund's assets;
the provision of reports to the Board regarding changes in portfolio holdings,
important developments affecting the entities whose securities are included in
the Fund's portfolio, and the money market industry and the economy in general;
and the compensation of all officers, directors and employees of the Fund who
are officers of the Manager or its affiliates. The Board also observed that the
Manager provides various administrative services to the Fund pursuant to the
terms of a separate Administrative Services Contract and considered the nature,
extent and quality of services provided under that agreement as well. The
Directors evaluated these factors based on their direct experience with the
Manager and in consultation with counsel to the independent directors and Fund
counsel. The Directors concluded that the nature and extent of the services
provided under the Investment Management Contract were reasonable and
appropriate in relation to the management fee, that the level of services
provided by the Manager had not diminished over the past year and that the
quality of services continues to be high. The Directors reviewed the personnel
responsible for providing advisory services to the Fund and concluded, based on
their experience and interaction with the Manager, that (i) the Manager was able
to retain quality portfolio managers and other personnel; (ii) the Manager
exhibited a high level of diligence and attention to detail in carrying out its
advisory responsibilities under the Investment Management Contract; (iii) the
Manager was responsive to requests of the Directors; and (iv) the Manager had
kept the Directors apprised of developments relating to the Fund and the
industry in general. The Directors also focused on the Manager's reputation and
long-standing relationship with the Fund and, in particular, the experience of
the Manager in advising money market funds. The Directors also noted the high
quality of services provided by the Manager under the Administrative Services
Contract.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
================================================================================
INFORMATION ABOUT THE INVESTMENT MANAGEMENT CONTRACT (continued)
2) The performance of the Fund and the Manager.
The Directors reviewed the investment performance of the Fund, both on an
absolute basis and as compared to various peer group categories for the month
ended, and the year ended, January 31, 2005. The peer group categories included:
(i) an asset-based peer group of New York tax free money market funds (i.e.,
other New York tax free funds that are similar in asset size to the Fund); and
(ii) a competitors class peer group for certain classes of the Fund,
representing other New York tax free funds that are considered to be competitors
of the Fund with similar distribution channels (the "competitors peer group").
These peer groups are collectively referred to as the "Peer Groups." The Manager
advised the Board that it does not advise or sub-advise: (i) other funds with a
similar investment policy to the Fund's; or (ii) other types of accounts, such
as institutional and pension accounts, with a similar investment policy to the
Fund's. The Directors used the Fund's performance against the Peer Groups to
provide objective comparative benchmarks against which they could assess the
Fund's performance. The Directors considered those comparisons as helpful in
their assessment as to whether the Manager was obtaining for the Fund's
shareholders the performance that was available in the marketplace given the
Fund's investment objectives, strategies, limitations and restrictions. In
particular, the Board noted that the gross performance of the Fund against all
the Peer Groups was satisfactory.
In connection with its assessment of the performance of the Manager, the
Directors considered the Manager's financial condition and whether it has the
resources necessary to continue to carry out its obligations under the
Investment Management Contract. The Directors took into account, in this regard,
the payments made by the Manager from its own resources to securities brokers,
banks and financial institutions or other industry professionals or
organizations whose customers are shareholders of the Fund ("Participating
Organizations") in connection with distribution assistance and shareholder
servicing provided by the Participating Organizations. The Directors concluded
that the Manager had the financial resources necessary to continue to perform
its obligations under the Investment Management Contract and to continue to
provide the high quality services that it had provided to the Fund to date.
3) The cost of the advisory services and the profits to the Manager and
its affiliates from the relationship with the Fund.
In connection with the Directors' consideration of the level of the management
fee, the Directors considered a number of factors. The Directors compared the
level of the management fee for the Fund against the advisory fees charged by
funds in the Peer Groups and the Fund's combined management-administrative fees
against fees covering both advisory and administrative services charged by the
funds in the Peer Groups. The Directors also considered comparative total fund
expenses of the Fund and the Peer Groups. The Directors used this combined fee
information and total expense data as a guide to help assess the reasonableness
of the Fund's management fee, although they acknowledged that it was difficult
to make precise comparisons with other funds since the exact nature of services
provided under the Peer Group fund agreements is often not apparent. The
Directors also viewed the Peer Group fee information as a whole as useful in
assessing whether the Manager was providing services at a cost that was
competitive with other, similar funds. In assessing this information, the
Directors considered both the comparative contract rates as well as the level of
the management fees after waivers and/or reimbursements. The Board noted that
the contract rates of the Fund's combined fees (management and administrative)
of the Fund were reasonable when compared to the combined fees of the
asset-based and competitors' peer groups. The Board further observed that the
total expense ratio of each class of the Fund was satisfactory when compared to
the expense ratio of the funds in the competitors' peer groups. The Directors
also noted that the Manager did not advise or sub-advise any other registered
investment companies or other types of accounts, such as institutional or
pension accounts, with a similar investment policies to the Fund. The Directors
concluded that the level of the management fee was reasonable in light of these
factors.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
NEW YORK DAILY TAX FREE INCOME FUND, INC.
ADDITIONAL INFORMATION (CONTINUED)
(UNAUDITED)
================================================================================
INFORMATION ABOUT THE INVESTMENT MANAGEMENT CONTRACT (continued)
3) The cost of the advisory services and the profits to the Manager and
its affiliates from the relationship with the Fund. (continued)
The Directors also considered the profitability to the Manager and its
affiliates arising out of their relationships with the Fund. In this regard the
Directors reviewed profitability data relating to the Manager and its affiliates
for the year ended December 31, 2004. The Directors considered revenues received
by the Manager under the Investment Management Contract and Administrative
Services Contract as well as revenues received by the Manager's affiliates under
the 12b-1 Plans and related agreements, Transfer Agency Agreement and revenues
derived from Reich & Tang's cash management business (e.g. checking and debit
card services that are offered by Reich & Tang to Fund shareholders through
certain Participating Organizations). The Directors concluded that the
profitability of the Fund to the Manager and its affiliates was not excessive.
4) The extent to which economies of scale will be realized as the Fund
grows and whether fee levels reflect those economies of scale.
With respect to the Directors' consideration of economies of scale, the
Directors discussed with the Manager whether economies of scale would be
realized by it in its management of the Fund at higher asset levels. The
Directors also discussed with the Manager whether certain of the Manager's costs
would increase if asset levels rise and observed that as assets rise, the
Manager and its affiliates may be required to pay increased fees to
Participating Organizations. The Directors also reviewed the Peer Group data to
assess whether the Peer Group funds had advisory or administrative fee
breakpoints and, if so, at what asset levels. The Directors concluded that they
were unable to assess at this time whether economies of scale would be realized
if the Fund were to experience significant asset growth. In the event there were
significant asset growth in the future, the Directors determined to reassess
whether the management fee appropriately took into account any economies of
scale that had been realized as a result of that growth.
5) Other Factors.
In addition to the above factors, the Directors acknowledged the importance of
the ability of the Manager's affiliate, the distributor, to market the Fund
through its distribution networks, including its customer service and
administration system with banks and bank customers.
Based on a consideration of all these factors in their totality, the Directors,
including all of the disinterested Directors, determined that the Fund's
management fee was fair and reasonable with respect to the quality of services
that the Manager provides and in light of the other factors described above that
the Directors deemed relevant. The Directors based their decision on evaluations
of all these factors as a whole and did not consider any one factor as
all-important or controlling. The disinterested Directors were also assisted by
the advice of independent counsel in making this determination.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
================================================================================
Directors and Officers Information
April 30, 2005 1
- -------------------- --------------- ---------------- ----------------------------- ---------------------- ----------------
Position(s) Term of Office Principal Occupation(s) Number of Portfolios Other
Name, Address 2, Held with and Length of During Past in Fund Complex Directorships
and Age Fund Time Served 3 5 Years Overseen by Director held by
Director
- -------------------- --------------- ---------------- ----------------------------- ---------------------- ----------------
Disinterested Directors:
- -------------------- --------------- ---------------- ----------------------------- ---------------------- ----------------
Edward A. Kuczmarksi, Director 1984 Certified Public Accountant Director of one Trustee of the
Age 55 and Partner of Hays & Company portfolio Empire Builder
LLP since 1980. Tax Free Bond
Fund
- -------------------- --------------- ---------------- ----------------------------- ---------------------- ----------------
Caroline E. Newell, Director 1984 Director of the Park Avenue Director of one Trustee of the
Age 64 Church Day School since portfolio Empire Builder
2001. Director of Le Chateau Tax Free Bond
des Enfants and the American Fund
School in Switzerland, both
since 1990.
- -------------------- --------------- ---------------- ----------------------------- ---------------------- ----------------
John P. Steines, Director 1984 Professor of Law, New York Director of one Trustee of the
Age 56 University School of Law portfolio Empire Builder
since 1980. Tax Free Bond
Fund
- -------------------- --------------- ---------------- ----------------------------- ---------------------- ----------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
NEW YORK DAILY TAX FREE INCOME FUND, INC.
ADDITIONAL INFORMATION (CONTINUED)
(UNAUDITED)
================================================================================
Directors and Officers Information
April 30, 2005 1
- -------------------- --------------- ---------------- ----------------------------- ---------------------- ----------------
Position(s) Term of Office Principal Occupation(s) Number of Portfolios Other
Name, Address 2, Held with and Length of During Past in Fund Complex Directorships
and Age Fund Time Served 3 5 Years Overseen by Director held by
Director
- -------------------- --------------- ---------------- ----------------------------- ---------------------- ----------------
Interested Directors/Officers:
- -------------------- --------------- ---------------- ----------------------------- ---------------------- ----------------
Steven W. Duff, President Since 1994 Manager and President of Director/Trustee None
Age 51 and Reich & Tang Asset and/or Officer of
Director 4 Management, LLC Sixteen portfolios.
("RTAM,LLC"), a registered
Investment Advisor and
President of the Mutual
Funds Division of RTAM
LLC. Associated with RTAM,
LLC since 1994. Mr. Duff
is also President and
Director/Trustee of eight
other funds in the Reich &
Tang Fund Complex,
Director of Pax World
Money Market Fund, Inc.,
Principal Executive
Officer of Delafield Fund,
Inc. and President and
Chief Executive Officer of
Tax Exempt Proceeds Fund,
Inc. Mr. Duff also serves
as a Director of Reich &
Tang Services, Inc. and
Reich & Tang Distributors,
Inc.
- -------------------- --------------- ---------------- ----------------------------- ---------------------- ----------------
Richard De Sanctis, Vice Since 2005 Executive Vice President N/A N/A
Age 48 President and CFO of RTAM LLC.
Associated with RTAM, LLC
Treasurer since 1990. Mr. De Sanctis
and is Vice President of ten
Assistant other funds in the Reich &
Secretary 1992 to 2005 Tang Fund Complex, Vice
President and Assistant
Secretary of Cortland
Trust, Inc. and serves as
Executive Vice President
and Chief Financial
Officer of Reich & Tang
Services, Inc. and Reich &
Tang Distributors, Inc.
Prior to December 2004,
Mr. DeSanctis was Treasurer
and Assistant Secretery of
eleven funds in the Reich
& Tang Fund Complex and
Vice President, Treasurer
and Assistant Secretary of
Cortland Trust, Inc.
- -------------------- --------------- ---------------- ----------------------------- ---------------------- ----------------
Molly Flewharty, Vice Since 1986 Senior Vice President of N/A N/A
Age 54 President RTAM, LLC. Associated with
RTAM, LLC since 1977. Ms.
Flewharty is also Vice
President of eleven other
funds in the Reich & Tang
Fund Complex. Ms. Flewharty
also serves as Senior Vice
President of Reich & Tang
Distributors, Inc.
- -------------------- --------------- ---------------- ----------------------------- ---------------------- ----------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
================================================================================
Directors and Officers Information
April 30, 2005 1
- -------------------- --------------- ---------------- ----------------------------- ---------------------- ----------------
Position(s) Term of Office Principal Occupation(s) Number of Portfolios Other
Name, Address 2, Held with and Length of During Past in Fund Complex Directorships
and Age Fund Time Served 3 5 Years Overseen by Director held by
Director
- -------------------- --------------- ---------------- ----------------------------- ---------------------- ----------------
Interested Directors/Officers:
- -------------------- --------------- ---------------- ----------------------------- ---------------------- ----------------
Rosanne Holtzer, Chief Since 2004 Senior Vice President, N/A N/A
Age 40 Compliance Compliance Officer and
Officer, Assistant Secretary of
RTAM, LLC. Associated
Secretary, Since 2001 with RTAM,LLC since 1986.
Ms. Holtzer is also Chief
Assistant Compliance Officer,
Treasurer Since 1998 Secretary and Assistant
Treasurer of eleven other
funds in the Reich & Tang
Fund Complex. Ms. Holtzer
also serves as Senior Vice
President, Assistant
Secretary & Compliance
Officer of Reich & Tang
Distributors, Inc. and
Senior Vice President,
Assistant Secretary &
Chief Compliance Officer
of Reich & Tang Services,
Inc.
- -------------------- --------------- ---------------- ----------------------------- ---------------------- ----------------
Michael Lydon, Vice President Since 2005 Executive Vice President N/A N/A
Age 41 and Chief Operations
Officer of RTAM, LLC.
Associated with RTAM, LLC
since January 2005. Mr.
Lydon was Vice President
at Automatic Data
Processing from July 2000
to December 2004. Prior
to July 2000, Mr. Lydon
was Executive Vice
President and Chief
Information Officer of
RTAM, LLC. Mr. Lydon is
also Vice President of
eleven other funds in the
Reich & Tang Fund Complex.
Mr. Lydon also serves as
Executive Vice President
and Chief Operations
Officer for Reich & Tang
Distributors, Inc. and
Reich & Tang Services,
Inc.
- -------------------- --------------- ---------------- ----------------------------- ---------------------- ----------------
Dana E. Messina, Vice President Since 1986 Executive Vice President N/A N/A
Age 48 of RTAM, LLC. Associated
with RTAM, LLC since 1980.
Ms. Messina is also Vice
President of eight other
funds in the Reich & Tang
Fund Complex. Ms. Messina
also serves as Executive
Vice President of Reich &
Tang Distributors, Inc.
- -------------------- --------------- ---------------- ----------------------------- ---------------------- ----------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
NEW YORK DAILY TAX FREE INCOME FUND, INC.
ADDITIONAL INFORMATION (CONTINUED)
(UNAUDITED)
================================================================================
Directors and Officers Information
April 30, 2005 1 (continued)
- -------------------- --------------- ---------------- ----------------------------- ---------------------- ----------------
Position(s) Term of Office Principal Occupation(s) Number of Portfolios Other
Name, Address 2, Held with and Length of During Past in Fund Complex Directorships
and Age Fund Time Served 3 5 Years Overseen by Director held by
Director
- -------------------- --------------- ---------------- ----------------------------- ---------------------- ----------------
Interested Directors/Officers:
- -------------------- --------------- ---------------- ----------------------------- ---------------------- ----------------
Anthony Pace, Treasurer and Since 2004 Vice President of RTAM, N/A N/A
Age 39 Assistant LLC since September 2004.
Secretary Mr. Pace was a Director of
a Client Service Group at
GlobeOp Financial
Services, Inc. from May
2002 to August 2004 and
Controller/Director of
Mutual Fund Administration
for Smith Barney Funds
Management LLC and
Salomon Brothers Asset
Management, Inc. from 1998
to May 2002. Mr. Pace is
also Treasurer and
Assistant Secretary of
eleven other funds in the
Reich & Tang Fund Complex.
- -------------------- --------------- ---------------- ----------------------------- ---------------------- ----------------
1 The Statement of Additional Information includes additional information
about New York Daily Tax Free Income Fund, Inc. (the "Fund")
directors/officers and is available, without charge, upon request by
calling the Fund's transfer agent at (800) 433-1918.
2 The address for each of the above directors/officers of the Fund is Reich &
Tang Asset Management, LLC, 600 Fifth Avenue, New York, NY 10020.
3 Each Director will hold office for an indefinite term until the earliest of
(i) the next meeting of shareholders, if any, called for the purpose of
considering the election or re-election of such Director and until the
election and qualification of his or her successor, if any, elected at such
meeting, or (ii) the date a Director resigns or retires, or a Director is
removed by the Board of Directors or shareholders, in accordance with the
Fund's Articles of Incorporation, as amended, and Amended and Restated
By-Laws. Each officer will hold office for an indefinite term until the
date he or she resigns or retires or until his/her successor is elected and
qualifies.
4 Steven W. Duff is deemed an interested person of the Fund due to his
affiliation with RTAM, LLC, the Fund's investment advisor.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
NEW YORK
DAILY
TAX FREE
INCOME
FUND, INC.
Annual Report
April 30, 2005
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- ------------------------------------------------------
This report is submitted for the general information
of the shareholders of the Fund. It is not authorized
for distribution to prospective investors in the Fund
unless preceded or accompanied by an effective
prospectus, which includes information regarding the
Fund's objectives and policies, experience of its
management, marketability of shares, and other
information.
- ------------------------------------------------------
New York Daily Tax Free Income Fund, Inc.
600 Fifth Avenue
New York, New York 10020
Manager
Reich & Tang Asset Management, LLC
600 Fifth Avenue
New York, New York 10020
Custodian
The Bank of New York
101 Barclay Street - 13th Floor
New York, New York 10286
Transfer Agent &
Dividend Disbursing Agent
Reich & Tang Services, Inc.
600 Fifth Avenue
New York, New York 10020
NY04/04A
- --------------------------------------------------------------------------------
ITEM 2: CODE OF ETHICS
The registrant has adopted a Code of Ethics applicable to its Principal
Executive and Senior Financial Officers.
ITEM 3: AUDIT COMMITTEE FINANCIAL EXPERT
The registrant's Board of Directors has determined that there is an audit
committee financial expert serving on its audit committee, Edward A. Kuczmarski,
who is "independent," as defined in the instructions to this Item.
ITEM 4: PRINCIPAL ACCOUNTANT FEES AND SERVICES
FYE 04/30/2005 FYE 04/30/2004
-------------- --------------
4(a) Audit Fees $24,800 $23,000
-------------- --------------
4(b) Audit Related Fees $ 0 $ 0
-------------- --------------
4(c) Tax Fees $ 3,410 $ 3,000
-------------- --------------
4(d) All Other Fees $ 0 $ 0
-------------- --------------
4(e)(1) The audit committee has adopted pre-approval policies and procedures
whereby the audit committee has pre-approved the provision of certain enumerated
tax services to the registrant by the registrant's principal accountant to the
extent the fee is less than $5,000 per occurrence.
4(e)(2) None.
4(f) Not applicable.
4(g) $3,410 and $22,500, respectively, were the amount of non-audit fees that
were billed by the registrant's accountant for services rendered to (i) the
registrant, and (ii) the registrant's investment adviser and any control person
of the adviser that provides ongoing services to the registrant for the fiscal
year ended April 30, 2005. $3,000 and $20,000 , respectively, were the amount of
non-audit fees that were billed by the registrant's accountant for services
rendered to (i) the registrant, and (ii) the registrant's investment adviser and
any control person of the adviser that provides ongoing services to the
registrant for the fiscal year ended April 30, 2004.
4(h) The registrant's audit committee has considered whether its principal
accountant's provision of non-audit services that were rendered to the
registrant's investment adviser, and any control persons of the investment
adviser that provides ongoing services to the registrant, that were not
pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X, is
compatible with maintaining the principal accountant's independence.
ITEM 5: AUDIT COMMITTEE OF LISTED REGISTRANTS
Not applicable.
ITEM 6: SCHEDULE OF INVESTMENTS
Schedule of Investments in securities of unaffiliated issuers is included under
Item 1.
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
There were no material changes to the procedures by which shareholders may
recommend nominees to the registrant's board of directors that were implemented
after the registrant last provided disclosure in response to the requirements of
Item 7(d)(2)(ii)(G) of Schedule 14A, or this Item 9.
ITEM 10: CONTROLS AND PROCEDURES
(a) The registrant's Principal Executive Officer and Principal Financial
Officer have evaluated the design and operation of the registrant's
disclosure controls and procedures within 90 days of this filing and have
concluded that the registrant's disclosure controls and procedures were
effective in ensuring that information required to be disclosed by the
registrant in this Form N-CSR was recorded, processed, summarized and
reported on a timely basis.
(b) There were no changes in the registrant's internal controls over financial
reporting that occurred during the second fiscal quarter covered by this
report that have materially affected, or are reasonably likely to affect,
the registrant's internal controls over financial reporting.
ITEM 11: EXHIBITS
(a)(1) Code of Ethics.
(a)(2) Certifications of Principal Executive Officer and Principal Financial
Officer, under Rule 30a-2 of the Investment Company Act of 1940.
(a)(3) Not applicable.
(b) Certifications of Principal Executive Officer and Principal Financial
Officer, under Section 906 of the Sarbanes-Oxley Act of 2002 and 18
U.S.C. ss.1350.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) New York Daily Tax Free Income Fund, Inc.
By (Signature and Title)* /s/ Rosanne Holtzer
-------------------
Rosanne Holtzer, Secretary
Date: July 7, 2005
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By (Signature and Title)* /s/ Steven W. Duff
------------------
Steven W. Duff, President
Date , 2005
By (Signature and Title)* /s/ Anthony Pace
----------------
Anthony Pace, Treasurer
Date July 7, 2005
* Print the name and title of each signing officer under his or her signature.