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 811-3111
811-21301
Name of Fund: CMA Tax-Exempt Fund
Master Tax-Exempt Trust
Fund Address: P.O. Box 9011
Princeton, NJ 08543-9011
Name and address of agent for service: Terry K. Glenn, President,
CMA Tax-Exempt Fund and Master Tax-Exempt Trust, 800 Scudders Mill
Road, Plainsboro, NJ, 08536. Mailing address: P.O. Box 9011,
Princeton, NJ, 08543-9011
Registrant's telephone number, including area code: (609) 282-2800
Date of fiscal year end: 03/31/04
Date of reporting period: 04/01/03 - 09/30/03
Item 1 - Attach shareholder report
(BULL LOGO)
Merrill Lynch Investment Managers
www.mlim.ml.com
CMA Tax-Exempt Fund
Semi-Annual Report
September 30, 2003
This report is not authorized for use as an offer of sale or a
solicitation of an offer to buy shares of the Fund unless
accompanied or preceded by the Fund's current prospectus. An
investment in the Fund is not insured or guaranteed by the Federal
Deposit Insurance Corporation or any other government agency.
Although the Fund seeks to preserve the value of your investment at
$1.00 per share, it is possible to lose money by investing in the
Fund. Past performance results shown in this report should not be
considered a representation of future performance, which will
fluctuate. Statements and other information herein are as dated and
are subject to change.
CMA Tax-Exempt Fund
Box 9011
Princeton, NJ
08543-9011
CMA Tax-Exempt Fund
Officers and Trustees
Terry K. Glenn,President and Trustee
Ronald W. Forbes,Trustee
Cynthia A. Montgomery,Trustee
Charles C. Reilly,Trustee
Kevin A. Ryan,Trustee
Roscoe S. Suddarth,Trustee
Richard R. West,Trustee
Edward D. Zinbarg,Trustee
Kenneth A. Jacob, Senior Vice President
John M. Loffredo,Senior Vice President
Peter J. Hayes,Vice President
Donald C. Burke,Vice President and Treasurer
Phillip S. Gillespie,Secretary
Custodian
State Street Bank and Trust Company
P.O. Box 351
Boston, MA 02101
Transfer Agent
Financial Data Services, Inc.
4800 Deer Lake Drive East
Jacksonville, FL 32246-6484
800-221-7210*
*For inquiries regarding your CMA account, call 800-CMA-INFO
(800-262-4636).
Electronic Delivery
The Fund is now offering electronic delivery of communications to
its shareholders. In order to receive this service, you must
register your account and provide us with e-mail information.
To sign up for this service, simply access this website
http://www.icsdelivery.com/live and follow the instructions.
When you visit this site, you will obtain a personal identification
number (PIN). You will need this PIN should you wish to update your
e-mail address, choose to discontinue this service and/or make any
other changes to the service. This service is not available for
certain retirement accounts at this time.
CMA TAX-EXEMPT FUND, SEPTEMBER 30, 2003
A Letter From the President
Dear Shareholder
Now in its final quarter, 2003 has been a meaningful year in many
respects. After one of the most significant equity market downturns
in many investors' memories, this year finally brought hopeful signs
for a sustainable economic recovery. Sub par economic growth of 1.4%
in the first quarter of 2003 increased to projected growth of more
than 4% in the second half of the year. With that good news, fixed
income investments, which had become the asset class of choice
during the long equity market decline, faced new challenges.
The Federal Reserve Board continued its accommodative monetary
policy, lowering the Federal Funds rate in June to 1%, its lowest
level since 1958. With this move, the short end of the yield curve
remained relatively flat and it became increasingly difficult to
find attractive income opportunities. Through September 30, 2003,
both the Bond Market Association (BMA) Index and the one-year
Municipal Market Data (MMD) Index averaged 1.03% for the year. Rates
on the BMA Index, which measures the shortest end of the yield
curve, averaged .85% during the third quarter versus 1.16% in the
second quarter. Rates on the one-year MMD Index averaged .98% in the
third quarter, just below the second quarter average of 1%.
Against this backdrop, our portfolio managers continued to work
diligently to maximize tax-exempt returns consistent with the
preservation of capital. With that said, remember also that the
advice and guidance of a skilled financial advisor often can help
you choose those investments that will best serve you as you plan
for your financial future.
Finally, I am proud to premiere a new look to our shareholder
communications. Our portfolio manager commentaries have been trimmed
and organized in such a way that you can get the information you
need at a glance, in plain language. Today's markets are confusing
enough. We want to help you put it all in perspective. The report's
new size also allows us certain mailing efficiencies. Any cost
savings in production or postage are passed on to the Fund and,
ultimately, to Fund shareholders.
We thank you for trusting Merrill Lynch Investment Managers with
your investment assets, and we look forward to serving you in the
months and years ahead.
Sincerely,
(Terry K. Glenn)
Terry K. Glenn
President and Trustee
CMA TAX-EXEMPT FUND, SEPTEMBER 30, 2003
A Discussion With Your Fund's Portfolio Manager
With interest rates low and expected to remain that way for some
time, we looked increasingly to the higher yields offered by fixed
rate notes during the period.
How did the Fund perform during the period in light of the existing
market conditions?
For the six-month period ended September 30, 2003, CMA Tax-Exempt
Fund paid shareholders a net annualized yield of .58%.* As of
September 30, 2003, the Fund's 7-day yield was .57%.
The Federal Reserve Board cut the Federal Funds rate once more
during the six-month period, sending interest rates to their lowest
levels in almost 50 years. Despite indications that the economy was
strengthening gradually, the Federal Reserve Board emphasized its
concern that deflation was a bigger threat to the economy than
inflation, and reassured investors that it planned to keep short-
term interest rates low until consistent growth in the economy and
employment became evident.
The expectation for a stable short-term interest rate environment
created a strong demand for fixed rate notes with maturities of six
months - one year. This caused yields on these notes to fall later
in the period and somewhat flattened the yield curve when compared
to variable rate demand securities. However, our aggressive pursuit
of fixed rate notes earlier in the period enabled us to lock in a
favorable spread above variable rate securities. This strategy
enhanced the performance of the Fund during the six-month period.
*Based on a constant investment throughout the period, with
dividends compounded daily, and reflecting a net return to the
investor after all expenses.
How did you manage the Fund during the period?
The portion of the yield curve that represents the Fund's investment
universe--notes maturing in one year or less--normally has a
positive slope. During the six-month period, however, interest rates
were generally stable or declining and expected to maintain that
course. Our belief that interest rates would be relatively
consistent for the foreseeable future led us to overweight one-year
notes relative to funds in our iMoneyNet, Inc. category.
As fixed rate notes matured and rolled off the portfolio, we sought
to buy new fixed paper whenever possible to extend the Fund's
average life, though the reinvestment occurred in a lower interest
rate environment than last year. In August, short-term interest
rates rose somewhat, influenced by a large $7.5 billion debt issue
from the state of Texas. The excess supply, along with indications
that the economy was strengthening, resulted in generally falling
prices and rising yields for money market securities. The higher
yields gave us an opportunity to replenish the Fund's position in
fixed rate paper, as 14% of the Fund's fixed notes came due between
June and September.
In addition to our preference for fixed rate notes, we also added to
our holdings in tax-exempt commercial paper. We favored commercial
paper because it provides greater flexibility to develop a desired
maturity structure. Overall, we sought to generate a slightly longer-
than-average portfolio maturity to help stabilize the Fund's yield,
reduce its vulnerability to market shifts, and reduce the need to
constantly reinvest assets in a low interest rate environment.
How would you characterize the portfolio's position at the close of
the period?
We continue to take a moderately longer approach to the short-term
municipal market. At the end of the period, the Fund's average
portfolio maturity was in a range of 55 days - 60 days, compared to
an average of 48 days for funds in our iMoneyNet group. We expect to
continue to take advantage of opportunities to buy longer-dated
fixed notes when available, to provide shareholders with added yield
and to extend the Fund's average life. We also expect to add to our
commercial paper holdings as conditions warrant.
CMA TAX-EXEMPT FUND, SEPTEMBER 30, 2003
In the months ahead, we will continue to monitor developments in the
national economy as well as the credit quality of the Fund's
holdings. We intend to maintain our basic investment strategy while
shifting the Fund's allocation between fixed and variable rate notes
in what we believe are the best interests of our shareholders. We
also will keep a watchful eye on the Federal Reserve Board's
monetary policy. Although we have a stable outlook for short-term
interest rates, we will be ready to respond with changes to our
investment approach as needed.
Peter J. Hayes
Vice President and Portfolio Manager
October 9, 2003
CMA TAX-EXEMPT FUND, SEPTEMBER 30, 2003
Statement of Assets and Liabilities
As of September 30, 2003
Assets
Investment in Master Tax-Exempt Trust, at value
(identified cost--$9,413,813,816) $ 9,413,813,816
Prepaid registration fees and other assets 785,624
---------------
Total assets 9,414,599,440
---------------
Liabilities
Payables:
Distributor $ 2,537,668
Other affiliates 376,179
Administrator 259,367
---------------
Total liabilities 3,173,214
---------------
Net Assets
Net Assets $ 9,411,426,226
===============
Net Assets Consist of
Shares of beneficial interest, $.10 par value, unlimited number
of shares authorized $ 941,290,956
Paid-in capital in excess of par 8,470,653,533
Accumulated realized capital losses on investments from the Trust--net (518,263)
---------------
Net Assets--Equivalent to $1.00 per share based on 9,412,909,560
shares of beneficial interest outstanding. $ 9,411,426,226
===============
See Notes to Financial Statements.
CMA TAX-EXEMPT FUND, SEPTEMBER 30, 2003
Statement of Operations
For the Six Months Ended September 30, 2003
Investment Income from the Trust
Net investment income allocated from the Trust:
Interest $ 58,546,502
Expenses (7,579,353)
---------------
Net investment income from the Trust 50,967,149
---------------
Expenses
Administration fees $ 13,033,970
Distribution fees 6,492,596
Transfer agent fees 606,197
Registration fees 257,163
Printing and shareholder reports 78,245
Professional fees 51,947
Custodian fees 413
Other 17,795
---------------
Total expenses 20,538,326
---------------
Investment income--net 30,428,823
---------------
Realized Loss on Investments from the Trust--Net
Realized loss on investments from the Trust--net (304,516)
---------------
Net Increase in Net Assets Resulting from Operations $ 30,124,307
===============
See Notes to Financial Statements.
CMA TAX-EXEMPT FUND, SEPTEMBER 30, 2003
Statements of Changes in Net Assets
For the Six For the
Months Ended Year Ended
September 30, March 31,
Increase (Decrease) in Net Assets: 2003 2003++
Operations
Investment income--net $ 30,428,823 $ 97,179,406
Realized loss on investments and from the Trust--net (304,516) (52,394)
--------------- ---------------
Net increase in net assets resulting from operations 30,124,307 97,127,012
--------------- ---------------
Dividends to Shareholders
Dividends to shareholders from investment income--net (30,428,823) (97,179,406)
--------------- ---------------
Beneficial Interest Transactions:
Net proceeds from sale of shares 6,799,797,096 32,237,106,470
Value of shares issued to shareholders in reinvestment of dividends 9,991,763 97,182,443
--------------- ---------------
Total shares issued 6,809,788,859 32,334,288,913
--------------- ---------------
Cost of shares redeemed (7,244,594,528) (32,292,069,189)
Shares redeemed in connection with the bulk transfer of
WCMA shareholder assets (741,257,384) --
--------------- ---------------
Total shares redeemed (7,985,851,912) (32,292,069,189)
--------------- ---------------
Net increase (decrease) in net assets derived from beneficial
interest transactions (1,176,063,053) (42,219,724)
--------------- ---------------
Net Assets
Net increase (decrease) in net assets (1,176,367,569) 42,167,330
Beginning of period 10,587,793,795 10,545,626,465
--------------- ---------------
End of period $ 9,411,426,226 $10,587,793,795
=============== ===============
++On February 13, 2003, the Fund converted from a stand-alone
investment company to a "feeder" fund that seeks to achieve its
investment objective by investing all of its assets in the Trust,
which has the same investment objective as the Fund. All investments
will be made at the Trust level. This structure is sometimes called
a "master/feeder" structure.
See Notes to Financial Statements.
CMA TAX-EXEMPT FUND, SEPTEMBER 30, 2003
Financial Highlights
The following per share data and ratios
have been derived from information For the Six
provided in the financial statements. Months Ended
September 30, For the Year Ended March 31,
Increase (Decrease) in Net Asset Value: 2003 2003++++++ 2002 2001 2000
Per Share Operating Performance
Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
----------- ----------- ----------- ----------- -----------
Investment income--net --++ .01 .02 .03 .03
Realized and unrealized gain (loss)
on investments and from the Trust--net --++++ --++++ --++ --++ --++++
----------- ----------- ----------- ----------- -----------
Total from investment operations -- .01 .02 .03 .03
----------- ----------- ----------- ----------- -----------
Less dividends from investment
income--net --++++ (.01) (.02) (.03) (.03)
----------- ----------- ----------- ----------- -----------
Net asset value, end of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
=========== =========== =========== =========== ===========
Total Investment Return .58%* .93% 1.76% 3.51% 2.91%
=========== =========== =========== =========== ===========
Ratios to Average Net Assets
Expenses .54%*+++ .55%+++ .55% .54% .54%
=========== =========== =========== =========== ===========
Investment income--net .58%* .93% 1.78% 3.46% 2.87%
=========== =========== =========== =========== ===========
Supplemental Data
Net assets, end of period
(in thousands) $ 9,411,426 $10,587,794 $10,545,626 $10,379,038 $10,188,792
=========== =========== =========== =========== ===========
*Annualized.
++Amount is less than $.01 per share.
++++Amount is less than $(.01) per share.
++++++On February 13, 2003, the Fund converted from a stand-alone
investment company to a "feeder" fund that seeks to achieve its
investment objective by investing all of its assets in the Trust,
which has the same investment objective as the Fund. All investments
will be made at the Trust level. This structure is sometimes called
a "master/feeder" structure.
+++Includes the Fund's share of the Trust's allocated expenses.
See Notes to Financial Statements.
CMA TAX-EXEMPT FUND, SEPTEMBER 30, 2003
Notes to Financial Statements
1. Significant Accounting Policies:
CMA Tax-Exempt Fund (the "Fund") is registered under the Investment
Company Act of 1940, as amended, as a no load, diversified, open-end
management investment company. The Fund seeks to achieve its
investment objective by investing all of its assets in the Master
Tax-Exempt Trust (the "Trust"), which has the same investment
objective as the Fund. The value of the Fund's investment in the
Trust reflects the Fund's proportionate interest in the net assets
of the Trust. The performance of the Fund is directly affected by
the performance of the Trust. The financial statements of the Trust,
including the Schedule of Investments, are included elsewhere in
this report and should be read in conjunction with the Fund's
financial statements. The Fund's financial statements are prepared
in conformity with accounting principles generally accepted in the
United States of America, which may require the use of management
accruals and estimates. These unaudited financial statements reflect
all adjustments, which are, in the opinion of management, necessary
to a fair statement of the results for the interim period presented.
All such adjustments are of a normal, recurring nature. The
percentage of the Trust owned by the Fund at September 30, 2003 was
approximately 92.8%. The following is a summary of significant
accounting policies followed by the Fund.
(a) Valuation of investments--The Fund records its investment in the
Trust at fair value. Valuation of securities held by the Trust is
discussed in Note 1a of the Trust's Notes to Financial Statements,
which are included elsewhere in this report.
(b) Investment income and expenses--The Fund records daily its
proportionate share of the Trust's income, expenses and realized and
unrealized gains and losses. In addition, the Fund accrues its own
expenses.
(c) 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 substantially all of its
taxable income to its shareholders. Therefore, no Federal income tax
provision is required.
(d) Prepaid registration fees--Prepaid registration fees are charged
to expense as the related shares are issued.
(e) Dividends and distributions to shareholders--The Fund declares
dividends daily and reinvests daily such dividends (net of non-
resident alien tax and backup withholding tax withheld) in
additional fund shares at net asset value. Dividends and
distributions are declared from the total of net investment income
and net realized gain or loss on investments.
(f) Investment transactions--Investment transactions are accounted
for on a trade date basis.
2. Investment Advisory Agreement and Transactions with Affiliates:
The Fund has entered into an Administration Agreement with Fund
Asset Management, L.P. ("FAM"). The general partner of FAM is
Princeton Services, Inc. ("PSI"), a wholly-owned subsidiary of
Merrill Lynch & Co., Inc. ("ML & Co."), which is the limited
partner. The Fund pays a monthly fee at an annual rate of .25% of
the Fund's average daily net assets for the performance of
administrative services (other than investment advice and related
portfolio activities) necessary for the operation of the Fund.
The Fund has adopted a Distribution and Shareholder Servicing Plan
in compliance with Rule 12b-1 under the Investment Company Act of
1940, pursuant to which Merrill Lynch, Pierce, Fenner & Smith
Incorporated ("MLPF&S"), a subsidiary of ML & Co., receives a
distribution fee from the Fund. The fee is accrued daily and paid
monthly at the annual rate of .125% of average daily net assets of
the Fund for shareholders who maintain their accounts through
MLPF&S. The distribution fee is to compensate MLPF&S financial
advisors and other directly involved branch office personnel for
selling shares of the Fund and for providing direct personal
services to shareholders. The distribution fee is not compensation
for the administrative and operational services rendered to the Fund
by MLPF&S in processing share orders and administering shareholder
accounts.
CMA TAX-EXEMPT FUND, SEPTEMBER 30, 2003
Notes to Financial Statements (concluded)
Financial Data Services, Inc. ("FDS"), a wholly-owned subsidiary of
ML & Co., is the Fund's transfer agent.
Certain officers and/or trustees of the Fund are officers and/or
directors of FAM, PSI, FDS, and/or ML & Co.
3. Transactions in Shares of Beneficial Interest:
The number of shares sold, reinvested and redeemed during the
periods corresponds to the amounts included in the Statements of
Changes in Net Assets for net proceeds from sale of shares, value of
shares reinvested and cost of shares redeemed, respectively, since
shares are recorded at $1.00 per share.
4. Capital Loss Carryforward:
On March 31, 2003, the Fund had a net capital loss carryforward of
$216,368, of which $72,081 expires in 2008 and $144,287 expires in
2011. This amount will be available to offset like amounts of any
future taxable gains.
CMA TAX-EXEMPT FUND, SEPTEMBER 30, 2003
Schedule of Investments Master Tax-Exempt Trust (In Thousands)
Face
State Amount Municipal Bonds Value
Alabama--2.5% $ 50,755 Alabama Special Care Facilities Financing Authority, Mobile Revenue
Refunding Bonds (Ascension Health Credit), VRDN, Series B, 1.10%
due 11/15/2039 (h) $ 50,755
38,400 Birmingham, Alabama, Special Care Facilities, Financing Authority,
Revenue Refunding Bonds (Ascension Health Credit), VRDN, Series B, 1.03% due
11/15/2039 (h) 38,400
27,765 Daphne, Alabama, Special Care Facilities Financing Authority Revenue Bonds,
FLOATS, Series 593, 1.20% due 8/15/2008 (g)(h) 27,765
12,700 Daphne, Alabama, Special Care Facilities Financing Authority, Revenue
Refunding Bonds (Presbyterian), VRDN, Series B, 1.13% due 8/15/2023 (a)(h) 12,700
4,255 Eagle Tax-Exempt Trust, Birmingham, Alabama, Water Revenue Bonds, VRDN, Class A,
Series 2002-6009, 1.15% due 1/01/2043 (h) 4,255
Eagle Tax-Exempt Trust, Jefferson County, Alabama, Sewer Revenue Refunding Bonds,
VRDN, Series 2002 (h):
7,835 Class 6015, 1.15% due 2/01/2032 7,835
3,000 Class 6016, 1.15% due 2/01/2038 3,000
Jefferson County, Alabama, Sewer Revenue Refunding Bonds, VRDN (h):
20,000 Series C-6, 1.10% due 2/01/2040 20,000
39,500 Sub-Series B-7, 1.08% due 2/01/2042 (i) 39,500
Stevenson, Alabama, IDB, Environmental Improvement Revenue Bonds (Mead
Corporation Project), VRDN, AMT (h):
25,000 1.13% due 1/01/2031 25,000
18,000 Series B, 1.13% due 4/01/2033 18,000
6,300 Stevenson, Alabama, IDB, Environmental Improvement Revenue Refunding Bonds
(Mead Corporation Project), VRDN, AMT, Series C, 1.13% due 11/01/2033 (h) 6,300
Alaska--0.5% 16,000 Valdez, Alaska, Marine Terminal Revenue Bonds (Arco Transportation Project),
Series B, 2% due 1/01/2004 16,020
Valdez, Alaska, Marine Terminal Revenue Refunding Bonds:
14,500 (Phillips Petroleum Company Project), Series A, 2% due 1/01/2004 14,518
15,000 (Phillips Petroleum Company Project), Series C, 2% due 1/01/2004 15,019
5,500 (Phillips Transaction Inc. Project), 1.50% due 5/01/2004 5,500
Arizona--1.7% 45,200 Apache County, Arizona, IDA, IDR (Tucson Electric Power Co.), VRDN, Series 83-A,
1.10% due 12/15/2018 (h) 45,200
10,200 Arizona Educational Loan Marketing Corporation, Educational Loan Revenue Bonds,
VRDN, AMT, Series A, 1.15% due 3/01/2015 (f)(h) 10,200
Maricopa County, Arizona, IDA, S/F Mortgage Revenue Bonds (h):
28,556 FLOATS, AMT, Series 707, 1.21% due 12/01/2036 28,555
44,296 VRDN, Series B, 1.17% due 12/01/2037 44,296
8,015 VRDN, Series R-1A, 1.17% due 12/01/2004 8,015
13,620 VRDN, Series R-2A, 1.17% due 12/01/2003 13,620
21,112 Phoenix, Arizona, IDA, S/F Mortgage Revenue Bonds, VRDN, Series A, 1.131% due
5/01/2006 (h) 21,112
Portfolio Abbreviations for Master Tax-Exempt Trust
AMT Alternative Minimum Tax (subject to)
BAN Bond Anticipation Notes
COP Certificates of Participation
CP Commercial Paper
EDA Economic Development Authority
EDR Economic Development Revenue Bonds
FLOATS Floating Rate Securities
GO General Obligation Bonds
HDA Housing Development Authority
HFA Housing Finance Agency
IDA Industrial Development Authority
IDB Industrial Development Board
IDR Industrial Development Revenue Bonds
M/F Multi-Family
MERLOTS Municipal Extendible Receipt Liquidity
Option Tender Securities
MSTR Municipal Securities Trust Receipts
PCR Pollution Control Revenue Bonds
PUTTERS Puttable Tax-Exempt Receipts
RAN Revenue Anticipation Notes
RAW Revenue Anticipation Warrants
ROCS Reset Option Certificates
S/F Single-Family
TAN Tax Anticipation Notes
TRAN Tax Revenue Anticipation Notes
VRDN Variable Rate Demand Notes
CMA TAX-EXEMPT FUND, SEPTEMBER 30, 2003
Schedule of Investments (continued) Master Tax-Exempt Trust (In Thousands)
Face
State Amount Municipal Bonds Value
Arkansas--1.6% $ 7,000 Arkansas State Development Finance Authority, Environmental Facilities
Revenue Bonds (Teris LLC Project), VRDN, AMT, 1.15% due 3/01/2021 (h) $ 7,000
7,800 Arkansas State Development Finance Authority, M/F Housing Revenue Bonds
(Chapelridge Benton Project), VRDN, AMT, Series C, 1.23% due 6/01/2032 (h) 7,800
69,239 Arkansas State Development Finance Authority, S/F Mortgage Revenue Bonds,
FLOATS, AMT, Series 708, 1.21% due 9/01/2004 (h) 69,239
11,250 Clark County, Arkansas, Solid Waste Disposal Revenue Refunding Bonds
(Alcoa Inc. Project), VRDN, AMT, 1.58% due 8/01/2022 (h) 11,250
40,000 North Little Rock, Arkansas, Health Facilities Board, Health Care Revenue
Bonds (Baptist Health), VRDN, Series B, 1.12% due 12/01/2021 (f)(h) 40,000
22,000 Pulaski County, Arkansas, Lease Purpose Revenue Bonds, VRDN, Series A,
1.18% due 3/01/2007 (c)(h) 22,000
7,530 Pulaski County, Arkansas, Public Facilities Board, M/F Housing Revenue
Refunding Bonds (Waterford Apartments), VRDN, AMT, 1.23% due 7/01/2032 (h) 7,530
California--7.6% 6,250 California Health Facilities Financing Authority Revenue Bonds, FLOATS,
Series 591, 1.13% due 3/01/2014 (f)(h) 6,250
California Pollution Control Financing Authority, PCR, Refunding (Pacific
Gas and Electric), VRDN (h):
4,300 AMT, Series B, 1.18% due 11/01/2026 4,300
6,625 Series C, 1.18% due 11/01/2026 6,625
65,000 Series E, 1.13% due 11/01/2026 65,000
9,045 Series F, 1.13% due 11/01/2026 9,045
California Rural Home Mortgage Finance Authority, S/F Mortgage Revenue
27,840 Refunding Bonds, VRDN, AMT, 1.123% due 7/25/2004 (h) 27,840
California State Department of Water Resources, Power Supply Revenue Bonds,
VRDN (h):
25,000 Series C-4, 1.07% due 5/01/2022 25,000
107,000 Series C-13, 1.05% due 5/01/2022 (e) 107,000
10,000 California State, GO, MERLOTS, Series B-45, 1.09% due 10/01/2029 (h) 10,000
457,000 California State, RAW, Series A, 2% due 6/16/2004 459,862
26,135 Santa Cruz County, California, Board of Education, GO, TRAN, 1.75% due 7/01/2004 26,281
25,065 West Basin, California, Municipal Water District Revenue Bonds, COP
(Phase II--Recycled Water Project), VRDN, Series B, 1.15% due 8/01/2027 (h) 25,065
Colorado--2.3% 7,880 Adams County, Colorado, School District Number 012, GO, ROCS, Series II-R-1045,
1.15% due 12/15/2022 (e)(h) 7,880
3,250 Colorado Department of Transportation Revenue Bonds, ROCS, Series II-R-4046,
1.15% due 12/15/2016 (a)(h) 3,250
10,265 Colorado Department of Transportation Revenue Refunding Bonds, PUTTERS,
Series 318, 1.16% due 6/15/2015 (f)(h) 10,265
6,060 Colorado School Mines Development Corporation Revenue Bonds, VRDN, 1.20%
due 9/01/2026 (h) 6,060
95,000 Colorado State, Education Loan Program, TRAN, 1.75% due 8/09/2004 95,565
Denver, Colorado, City and County Airport Revenue Bonds, VRDN, AMT (h):
10,025 Series F, 1.15% due 11/15/2025 10,025
4,750 Series G, 1.15% due 11/15/2025 4,750
Denver, Colorado, City and County Airport, Revenue Refunding Bonds, AMT (h):
5,975 MERLOTS, Series A61, 1.20% due 11/15/2012 (b) 5,975
20,000 VRDN, Series C, 1.15% due 11/15/2025 20,000
7,636 El Paso County, Colorado, S/F Mortgage Revenue Refunding Bonds, VRDN,
Series A, 1.09% due 5/25/2004 (h) 7,636
6,500 Pitkin County, Colorado, IDR, Refunding (Aspen Skiing Company Project),
VRDN, AMT, Series B, 1.25% due 4/01/2014 (h) 6,500
53,200 Platte River Power Authority, Colorado, Electric Revenue Refunding Bonds,
VRDN, Sub-Lien, Series S-1, 1.10% due 6/01/2018 (h) 53,200
Connecticut--0.4% 24,750 Eagle Tax-Exempt Trust, Connecticut, VRDN, Series 96, Class 0701, 1.08%
due 11/15/2004 (h) 24,750
12,500 New Haven, Connecticut, BAN, 1.75% due 1/30/2004 12,531
Delaware--1.2% Delaware State, EDA, Revenue Bonds (Hospital Billing and Collection),
VRDN (a)(h):
59,050 Series B, 1.05% due 12/01/2015 59,050
60,000 Series C, 1.05% due 12/01/2015 60,000
6,580 Delaware State, EDA, Revenue Refunding Bonds (Exempt Facilities--Delmarva),
VRDN, Series A, 1.35% due 7/01/2024 (h) 6,580
CMA TAX-EXEMPT FUND, SEPTEMBER 30, 2003
Schedule of Investments (continued) Master Tax-Exempt Trust (In Thousands)
Face
State Amount Municipal Bonds Value
District of District of Columbia, GO, Refunding, VRDN (h):
Columbia--0.6% $ 17,350 MSTR, Series SGA-62, 1.23% due 6/01/2017 (a) $ 17,350
13,810 Series C, 1.10% due 6/01/2026 (b) 13,810
9,295 District of Columbia, HFA, S/F Mortgage Revenue Bonds, VRDN, 1.10% due
12/24/2003 (h) 9,295
18,795 District of Columbia, Hospital Revenue Bonds, FLOATS, Series 712, 1.21% due
7/15/2019 (h) 18,795
Florida--3.1% 22,206 Bay County, Florida, HFA, S/F Mortgage Revenue Bonds, FLOATS, AMT, Series 695,
1.28% due 6/01/2004 (h) 22,206
13,885 Broward County, Florida, Professional Sports Facilities, Tax Revenue Bonds,
MSTR, VRDN, Series SGA-38, 1.14% due 9/01/2021 (f)(h) 13,885
33,565 Capital Trust Agency, Florida, M/F Housing Revenue Bonds, VRDN, Series 1999-B,
1.25% due 12/01/2032 (h) 33,565
20,700 Dade County, Florida, Water and Sewer System Revenue Bonds, VRDN, 1.10% due
10/05/2022 (b)(h) 20,700
5,000 Florida Housing Finance Corporation, Housing Revenue Bonds (Tuscany Lakes),
VRDN, AMT, Series 1, 1.23% due 11/15/2035 (h) 5,000
Florida State Board of Education (h):
5,000 Capital Outlay, GO, FLOATS, Series 557, 1.14% due 1/01/2004 5,000
8,000 GO, MSTR, VRDN, Series SGA-139, 1.14% due 6/01/2032 (f) 8,000
2,890 Lottery Revenue Bonds, ROCS, Series II-R-4521, 1.15% due 7/01/2020 (b) 2,890
11,677 Florida State Department of Environmental Protection, Preservation Revenue
Bonds, FLOATS, Series 722, 1.14% due 7/01/2022 (b)(h) 11,677
845 Gulf Breeze, Florida, Local Government Revenue Bonds, VRDN, Series E, 1.10%
due 12/01/2020 (b)(h) 845
6,000 Highlands County, Florida, Health Facilities Authority, Hospital Revenue
Refunding Bonds (Adventist Health System), VRDN, Series C, 1.31% due
11/15/2021 (h) 6,000
4,000 Hillsborough County, Florida, Aviation Authority, Revenue Refunding Bonds,
MERLOTS, AMT, Series A18, 1.20% due 10/01/2013 (f)(h) 4,000
4,610 Jacksonville, Florida, Sales Tax Revenue Bonds, MERLOTS, Series B26, 1.15%
due 10/01/2027 (f)(h) 4,610
12,300 Jea, Florida, Water and Sewer System Revenue Refunding Bonds, VRDN, Series B,
1.07% due 10/01/2036 (h)(i) 12,300
19,100 Lakeland, Florida, Energy System Revenue Bonds, VRDN, Series A, 1.10% due
10/01/2035 (h) 19,100
2,950 Lee County, Florida, Hospital Board of Directors, Hospital Revenue Bonds
(Memorial Health System), VRDN, Series B, 1.17% due 4/01/2027 (h) 2,950
32,100 Martin County, Florida, PCR, Refunding (Florida Power & Light Company Project),
VRDN, 1.15% due 7/15/2022 (h) 32,100
Orange County, Florida, Health Facilities Authority Revenue Bonds, FLOATS (h):
16,583 Series 532, 1.15% due 11/15/2015 (a) 16,583
19,295 Series 830, 1.14% due 11/15/2022 (e) 19,295
Orlando and Orange County, Florida, Expressway Authority, Expressway Revenue
Refunding Bonds, VRDN (e)(h):
20,000 Series C2, 1.05% due 7/01/2025 20,000
15,000 Series C3, 1.05% due 7/01/2025 15,000
7,000 Reedy Creek, Florida, Improvement District, Florida Utilities Revenue Bonds,
ROCS, Series II-R-4027, 1.15% due 10/01/2023 (f)(h) 7,000
32,000 Saint Lucie County, Florida, PCR, Refunding (Florida Power and Light Company
Project), VRDN, 1.17% due 9/01/2028 (h) 32,000
Georgia--3.7% 16,300 Appling County, Georgia, Development Authority, PCR (Georgia Power Plant Hatch),
VRDN, Second Series, 1.20% due 12/01/2018 (h) 16,300
120,000 Atlanta, Georgia, Airport Revenue Bonds, BAN, 2.25% due 10/30/2003 120,024
Atlanta, Georgia, Airport Revenue Refunding Bonds, VRDN (f)(h):
26,710 Series B-2, 1.08% due 1/01/2030 26,710
21,710 Series C-3, 1.10% due 1/01/2030 21,710
Atlanta, Georgia, Urban Residential Finance Authority, S/F Mortgage Revenue
Bonds, VRDN (h):
1,555 Series NT-R-1A, 1.17% due 12/01/2003 1,555
6,195 Series R-3A, 1.17% due 12/01/2004 6,195
3,000 Atlanta, Georgia, Water and Wastewater Revenue Bonds, MSTR, VRDN, SGA-145,
1.14% due 11/01/2033 (f)(h) 3,000
8,000 Augusta, Georgia, Water and Sewer Revenue Refunding Bonds, MSTR, VRDN,
Series SGS-140, 1.14% due 10/01/2032 (e)(h) 8,000
CMA TAX-EXEMPT FUND, SEPTEMBER 30, 2003
Schedule of Investments (continued) Master Tax-Exempt Trust (In Thousands)
Face
State Amount Municipal Bonds Value
Georgia $ 12,200 Burke County, Georgia, Development Authority, PCR, Refunding (Georgia Power
(concluded) Corporation Plant Vogtle), First Series, 1.25% due 3/25/2004 $ 12,200
10,135 Clayton County, Georgia, Development Authority, Special Facilities Revenue
Bonds (Delta Air Lines Project), VRDN, Series A, 1.12% due 6/01/2029 (h) 10,135
7,000 Cobb County, Georgia, Development Authority Revenue Bonds (Whitefield
Academy Inc. Project), VRDN, 1.05% due 7/01/2025 (h) 7,000
20,470 DeKalb County, Georgia, School District, GO, TAN, Series 2002-2007, 2%
due 12/31/2003 20,515
10,585 Eagle Tax-Exempt Trust, Georgia, GO, VRDN, Series 01, Class 1001, 1.15%
due 11/01/2017 (h) 10,585
15,000 Fulton County, Georgia, Housing Authority Revenue Bonds, VRDN, 1.25%
due 12/01/2034 (h) 15,000
6,815 Georgia Municipal Electric Authority, Power Revenue Bonds, VRDN, Series D,
1.16% due 1/01/2017 (h) 6,815
7,000 Georgia State Road and Thruway Authority Revenue Bonds, ROCS, Series II-R-216,
1.15% due 3/01/2019 (h) 7,000
85,000 Gwinnett County, Georgia, School District, GO, Construction Sales Tax Notes,
2% due 12/29/2003 85,187
15,995 Municipal Securities Trust Certificates Revenue Bonds, Atlanta, Georgia
Wastewater, VRDN, AMT, Series 2002-186, Class A, 1.14% due 2/25/2021 (f)(h) 15,995
Hawaii--1.2% 7,930 Eagle Tax-Exempt Trust, Hawaii, VRDN, Series 2001, Class 1101, 1.15% due
7/01/2011 (h) 7,930
Hawaii State, GO (h):
7,220 FLOATS, Series 605, 1.14% due 8/01/2015 (b) 7,220
28,740 VRDN, Series II-R-126, 1.15% due 1/01/2005 (g) 28,740
Honolulu, Hawaii, City and County, GO, Refunding, VRDN, Series C (b)(h):
16,700 1.30% due 12/01/2012 16,700
16,600 1.30% due 12/01/2017 16,600
4,100 1.30% due 12/01/2019 4,100
19,000 Honolulu, Hawaii, City and County M/F Housing Revenue Bonds (Moanalua
Hillside Apartments), VRDN, AMT, 1.15% due 9/15/2032 (h) 19,000
Illinois--8.0% 14,285 ABN Amro Munitops Certificates Trust, Chicago, Illinois, GO, VRDN,
Series 2001-31, 1.18% due 1/01/2009 (b)(h) 14,285
Aurora, Illinois, Kane and DuPage Counties and Springfield, Illinois,
Single Mortgage Revenue Bonds (h):
635 FLOATS, AMT, Series 789, 1.20% due 4/03/2006 635
58,630 VRDN, Series A, 1.202% due 4/01/2004 58,630
34,500 VRDN, AMT, Series A-2, 1.205% due 4/01/2004 34,500
13,710 Chicago, Illinois, GO, VRDN, Series B, 1.05% due 1/01/2012 13,710
Chicago, Illinois, Midway Airport Revenue Bonds, Second Lien, VRDN, AMT (f)(h):
53,000 Series A, 1.15% due 1/01/2029 53,000
10,000 Series B, 1.15% due 1/01/2029 10,000
5,845 Chicago, Illinois, Motor Fuel Tax Revenue Refunding Bonds, ROCS,
Series II-R-2021, 1.15% due 1/01/2020 (a)(h) 5,845
2,700 Chicago, Illinois, O'Hare International Airport Revenue Bonds, ROCS, AMT,
Series II-R-239, 1.20% due 1/01/2022 (e)(h) 2,700
14,300 Chicago, Illinois, O'Hare International Airport, Special Facilities Revenue
Bonds (Compagnie Nationale--Air France), VRDN, AMT, 1.15% due 5/01/2018 (h) 14,300
6,810 Chicago, Illinois, Park District, GO, Refunding, ROCS, Series II-R-4002,
1.15% due 1/01/2023 (b)(h) 6,810
26,100 Chicago, Illinois, Revenue Bonds (Homestart Program), VRDN, Series A, 1.18%
due 6/01/2005 (h) 26,100
11,000 Eagle Tax-Exempt Trust, Chicago Board of Education, VRDN, Series 01, Class 1309,
1.15% due 12/01/2026 (h) 11,000
Eagle Tax-Exempt Trust, Chicago, Illinois, GO, VRDN, Class 1301 (h):
14,380 Series 95, 1.15% due 1/01/2024 14,380
9,900 Series 98, 1.15% due 1/01/2017 9,900
5,000 Eagle Tax-Exempt Trust, Chicago, Illinois, Metropolitan Pier and Exposition
Center, VRDN, Class A, Series 2002-6001, 1.15% due 12/15/2028 (f)(h) 5,000
30,000 Eagle Tax-Exempt Trust, Cook County, Illinois, VRDN, Series 02, Class 1303,
1.15% due 11/15/2025 (h) 30,000
Eagle Tax-Exempt Trust, Illinois, GO, VRDN (h):
11,000 Series 01, Class 1307, 1.15% due 11/01/2022 11,000
11,100 Series 02, Class 1302, 1.15% due 2/01/2027 11,100
14,355 Eagle Tax-Exempt Trust, Illinois, Metropolitan Expo Center, VRDN, Series 98,
Class 1306, 1.15% due 6/15/2029 (h) 14,355
12,625 Illinois Development Finance Authority, Revenue Refunding Bonds (Provena Health),
VRDN, Series C, 1.05% due 5/01/2028 (h) 12,625
CMA TAX-EXEMPT FUND, SEPTEMBER 30, 2003
Schedule of Investments (continued) Master Tax-Exempt Trust (In Thousands)
Face
State Amount Municipal Bonds Value
Illinois $ 5,000 Illinois Development Finance Authority, Water Facilities Revenue Refunding
(concluded) Bonds (Illinois American Water Company), VRDN, AMT, 1.20% due 3/01/2032 (f)(h) $ 5,000
Illinois Educational Facilities Authority Revenue Bonds, VRDN (h):
8,450 (The Art Institute of Chicago), 1.15% due 3/01/2027 8,450
4,500 (The Art Institute of Chicago), 1.15% due 3/01/2034 4,500
4,800 (Chicago Historical Society), 1.10% due 12/01/2025 4,800
Illinois Educational Facilities Authority, Revenue Refunding Bonds, VRDN (h):
28,800 (The Art Institute of Chicago), 1.15% due 3/01/2027 28,800
17,800 (Northwestern University), 1.10% due 12/01/2025 17,800
Illinois HDA, M/F Housing Revenue Bonds (Danbury Court Apartments), VRDN,
AMT (h):
6,300 Series A, 1.18% due 5/01/2037 6,300
450 Series B, 1.28% due 5/01/2037 450
Illinois Health Facilities Authority Revenue Bonds, Revolving Fund, Pooled,
VRDN (h):
40,000 Series B, 1.10% due 8/01/2020 40,000
7,000 Series F, 1.10% due 8/01/2015 7,000
Illinois Health Facilities Authority, Revenue Refunding Bonds, VRDN (h):
18,325 (Little Company of Mary Hospital), Series A, 1.17% due 8/15/2021 (f) 18,325
5,700 (Resurrection Health Care), Series A, 1.15% due 5/15/2029 (e) 5,700
16,700 (Resurrection Health Care), Series B, 1.07% due 5/15/2029 (e) 16,700
2,940 Illinois State Dedicated Tax (Macon Trust), VRDN, Series N, 1.18% due
12/15/2020 (h) 2,940
18,815 Illinois State, FLOATS, Series SG-60, 1.13% due 8/01/2019 (h) 18,815
9,000 Illinois State, GO, MERLOTS, Series B04, 1.15% due 12/01/2024 (e)(f)(h) 9,000
Illinois State, GO, Refunding (f)(h):
16,735 FLOATS, Series 743D, 1.14% due 8/01/2015 16,735
5,955 MERLOTS, Series A49, 1.15% due 8/01/2013 5,955
Illinois Student Assistance Commission, Student Loan Revenue Bonds, VRDN (h):
4,400 AMT, Series A, 1.10% due 3/01/2006 4,400
16,605 1.11% due 9/01/2034 16,605
Municipal Securities Trust Certificates, GO, VRDN, Class A (b)(h):
29,085 Series 2001-145, 1.14% due 11/15/2029 29,085
33,895 Series 2002-191, 1.19% due 3/18/2019 33,895
29,950 Municipal Securities Trust Certificates Revenue Bonds, Chicago O'Hare Airport,
Illinois, VRDN, AMT, Series 2001-151, Class A, 1.18% due 6/30/2015 (a)(h) 29,950
31,615 Municipal Securities Trust Certificates Revenue Bonds, Metro Pier & Expo
Authority, Illinois, VRDN, Series 2001-157, Class A, 1.14% due 10/05/2017 (b)(h) 31,615
21,350 Regional Transportation Authority, Illinois FLOATS, Series SG-82, 1.13%
due 6/01/2025 (h) 21,350
Regional Transportation Authority, Illinois, GO, MERLOTS (h):
19,945 Series A24, 1.15% due 7/01/2032 (f) 19,945
4,980 Series A41, 1.15% due 6/01/2017 (b) 4,980
5,190 Regional Transportation Authority, Illinois, Revenue Bonds, MERLOTS, Series B-15,
1.15% due 6/01/2027 (f)(h) 5,190
33,175 Regional Transportation Authority, Illinois, Revenue Refunding Bonds, FLOATS,
Series 818-D, 1.14% due 7/01/2033 (b)(h) 33,175
7,000 Will County, Illinois, Exempt Facilities Revenue Bonds (Amoco Chemical Company
Project), VRDN, AMT, 1.20% due 3/01/2028 (h) 7,000
Indiana--5.2% 10,000 ABN Amro Munitops Certificates Trust, South Bird, Indiana, VRDN, Series 1998-5,
1.18% due 4/05/2006 (e)(h) 10,000
13,000 Goshen, Indiana, EDR, Refunding (Goshen College Project), VRDN, 1.15% due
10/01/2037 (h) 13,000
Indiana Bond Bank Revenue Bonds:
107,600 Advance Funding Program Notes, Series A, 2% due 1/27/2004 (a) 107,912
5,875 FLOATS, Series 670, 1.14% due 10/01/2022 (f)(h) 5,875
Indiana Bond Bank, Special Program Notes, Series A:
1,600 1.60% due 1/06/2004 1,600
17,400 2% due 1/06/2004 17,435
Indiana Health Facilities Financing Authority, Hospital Revenue Bonds, VRDN (h):
82,200 (Clarian Health Obligation Group), Series C, 1.10% due 3/01/2030 82,200
11,000 (Clarian Health Partners), Series H, 1.10% due 3/01/2033 11,000
15,000 (Community Hospitals Project), Series A, 1.15% due 7/01/2027 15,000
CMA TAX-EXEMPT FUND, SEPTEMBER 30, 2003
Schedule of Investments (continued) Master Tax-Exempt Trust (In Thousands)
Face
State Amount Municipal Bonds Value
Indiana Indiana Health Facilities Financing Authority, Hospital Revenue Refunding
(concluded) Bonds (Clarian Health Partners), VRDN (h):
$ 51,800 Series B, 1.10% due 2/15/2026 $ 51,800
50,800 Series C, 1.10% due 2/15/2026 50,800
1,650 Indiana Health Facilities Financing Authority Revenue Bonds (Capital Access
Designated Pool), VRDN, 1.05% due 1/01/2012 (h) 1,650
41,330 Indiana Secondary Market Educational Loans Inc., Educational Loan Revenue Bonds,
VRDN, AMT, Series B, 1.10% due 12/01/2014 (a)(h) 41,330
15,830 Indiana State HFA, S/F Mortgage Revenue Bonds, VRDN, AMT, Series E-2, 1.40%
due 1/01/2034 (h) 15,830
24,000 Indianapolis, Indiana, Citizens Gas and Coke Company, CP, 0.90% due 10/02/2003 24,000
34,995 Municipal Securities Trust Certificates Revenue Bonds, Indianapolis Local
Public Improvement, VRDN, Series 2002-192, Class A, 1.14% due 6/18/2014 (f)(h) 34,995
2,100 Whiting, Indiana, Environmental Facilities Revenue Bonds (BP Products North
America Project), VRDN, AMT, 1.20% due 7/01/2035 (h) 2,100
10,000 Whiting, Indiana, Environmental Facilities, Revenue Refunding Bonds
(BP Products Project), VRDN, AMT, Series C, 1.20% due 7/01/2034 (h) 10,000
Whiting, Indiana, Industrial Sewer and Solid Waste Disposal, Revenue Refunding
Bonds (Amoco Oil Company Project), VRDN, AMT (h):
7,600 1.20% due 1/01/2026 7,600
9,900 1.20% due 1/01/2026 9,900
Iowa--0.2% 14,500 Iowa Student Loan Liquidity Corporation, Student Loan Revenue Bonds, VRDN,
AMT, Series B, 1.10% due 12/01/2013 (a)(h) 14,500
10,000 Louisa County, Iowa, PCR, Refunding (Iowa--Illinois Gas and Electric), VRDN,
Series A, 1.20% due 9/01/2016 (h) 10,000
Kansas--0.4% 9,100 Butler County, Kansas, Solid Waste Disposal Facilities Revenue Bonds (Texaco
Refining and Marketing), VRDN, AMT, Series A, 1.20% due 8/01/2024 (h) 9,100
16,800 Kansas State Development Finance Authority, Health Facilities Revenue Bonds
(Stormont--Vail), VRDN, Series M, 1.20% due 11/15/2023 (f)(h) 16,800
13,000 Kansas State Turnpike Authority, Turnpike Revenue Refunding Bonds, PUTTERS,
Series 361, 1.05% due 3/01/2011 (a)(h) 13,000
Kentucky--2.2% 12,195 ABN Amro Munitops Certificates Trust, Lexington, Kentucky, GO, VRDN,
Series 2001-37, 1.18% due 2/01/2010 (b)(h) 12,195
2,500 Boyd County, Kentucky, Sewer and Solid Waste Revenue Bonds (Air Products and
Chemicals Project), VRDN, AMT, 1.26% due 6/01/2021 (h) 2,500
20,930 Carroll County, Kentucky, PCR (Utility Co. Project), Series A, CP, 1.05%
due 10/30/2003 20,930
Daviess County, Kentucky, Solid Waste Disposal Facility Revenue Bonds (Scott
Paper Company Project),VRDN, AMT (h):
44,100 Series A, 1.20% due 12/01/2023 44,100
26,200 Series B, 1.20% due 12/01/2023 26,200
26,000 Jefferson County, Kentucky, PCR, CP, 1% due 10/06/2003 26,000
26,800 Kenton County, Kentucky, Airport Board, Special Facilities Revenue Bonds
(Airis Cincinnati LLC), VRDN, AMT, Series A, 1.15% due 7/01/2032 (h) 26,800
2,200 Kenton County, Kentucky, Airport Board, Special Facilities Revenue Refunding
Bonds (Delta Airlines Inc.), VRDN, Series B, 1.12% due 10/01/2030 (h) 2,200
5,900 Kentucky State Property and Buildings Commission, Revenue Refunding Bonds,
FLOATS, Series 575, 1.14% due 2/01/2017 (e)(h) 5,900
36,475 Kentucky State Turnpike Authority, Resource Recovery Road Revenue Bonds,
FLOATS, Series 488, 1.14% due 7/01/2007 (e)(h) 36,475
16,000 Louisville and Jefferson Counties, Kentucky, Metropolitan Sewer District,
Sewer and Drain System Revenue Refunding Bonds, VRDN, Series B, 1.07% due
5/15/2023 (e)(h) 16,000
Louisiana--3.1% 17,700 Ascension Parish, Louisiana, Revenue Bonds (BASF Corporation Project), VRDN,
AMT, 1.25% due 3/01/2025(h) 17,700
31,500 Calcasieu Parish, Louisiana, IDB, Environmental Revenue Refunding Bonds
(Citgo Petroleum Corp.), VRDN, AMT, 1.22% due 3/01/2025 (h) 31,500
31,845 East Baton Rouge, Louisiana, Mortgage Finance Authority Revenue Bonds
(Conventional Program Notes), Series A-R-4, 1.16% due 3/10/2005 31,845
25,000 Jefferson Parish, Louisiana, Hospital Service District Number 001, Hospital
Revenue Bonds (West Jefferson Medical Center), VRDN, Series B, 1.10% due
1/01/2028 (e)(h) 25,000
CMA TAX-EXEMPT FUND, SEPTEMBER 30, 2003
Schedule of Investments (continued) Master Tax-Exempt Trust (In Thousands)
Face
State Amount Municipal Bonds Value
Louisiana Louisiana HFA, S/F Mortgage Revenue Refunding Bonds:
(concluded) $ 16,824 1.156% due 5/28/2004 $ 16,824
8,000 VRDN, AMT, 1.156% due 5/28/2004 (h) 8,000
6,000 Louisiana Local Government, Environmental Facilities, Community Development
Authority Revenue Bonds (Honeywell International Inc. Project), VRDN, AMT,
1.28% due 12/01/2037 (h) 6,000
Louisiana Public Facilities Authority Revenue Bonds (Equipment and Capital
Facilities Loan Program), VRDN (h):
9,325 Series B, 1.16% due 7/01/2023 9,325
10,440 Series B, 1.16% due 7/01/2023 10,440
15,620 Series C, 1.18% due 7/01/2024 15,620
Louisiana State GO (b)(h):
2,845 FLOATS, Series 667, 1.18% due 4/01/2019 2,845
3,000 ROCS, Series II-R-4017, 1.15% due 5/01/2023 3,000
8,175 New Orleans, Louisiana, Ernest N. Morial Exhibit Hall Authority, Special Tax,
ROCS, Series II-R-4038, 1.15% due 7/15/2023 (a)(h) 8,175
21,557 New Orleans, Louisiana, Finance Authority, S/F Mortgage Revenue Refunding
Bonds, VRDN, Series C, 1.174% due 6/01/2042 (h) 21,557
15,000 Plaquemines Parish, Louisiana, Environmental Revenue Bonds (BP Exploration & Oil),
VRDN, AMT, 1.20% due 10/01/2024 (h) 15,000
4,400 Saint Charles Parish, Louisiana, PCR, Refunding (Shell Oil Company Project),
VRDN, 1.10% due 6/01/2005 (h) 4,400
Saint Charles Parish, Louisiana, PCR, VRDN, AMT (h):
48,700 (Shell Oil Company--Norco Project), 1.20% due 11/01/2021 48,700
15,100 (Shell Oil Company--Norco Project), 1.20% due 9/01/2023 15,100
21,000 (Shell Oil Company Project), Series A, 1.20% due 10/01/2022 21,000
4,400 South Louisiana Port Commission, Port Revenue Refunding Bonds (Occidental
Petroleum), VRDN, 1.05% due 7/01/2018 (h) 4,400
Maryland--0.8% 5,345 Anne Arundel County, Maryland, Pollution Revenue Bonds (Baltimore Gas and
Electric Company), VRDN, 1.23% due 7/01/2004 (h) 5,345
35,700 Baltimore, Maryland, Port Facilities Revenue Bonds (Occidental Petroleum),
FLOATS, 0.95% due 10/14/2011 (h) 35,700
Maryland State Community Development Administration, Department of Housing
and Community Development, Residential Revenue Refunding Bonds:
19,760 AMT, Series E, 1.25% due 12/18/2003 19,760
20,000 Series D, 1.20% due 12/18/2003 20,000
Massachusetts-- 10,000 Eagle Tax-Exempt Trust, Massachusetts Commuter Facilities, VRDN, Series 2001,
0.7% Class 2101, 1.08% due 6/15/2033 (h) 10,000
29,918 Massachusetts State, GO, Refunding, FLOATS, Series 716D, 1.08% due
8/01/2018 (f)(h) 29,918
24,130 Millbury, Massachusetts, GO, BAN, Series B, 1.50% due 1/23/2004 24,157
7,500 New Bedford, Massachusetts, GO, RAN, 1.75% due 6/30/2004 7,537
Michigan--2.6% 15,000 ABN Amro Munitops Certificates Trust, Michigan, GO, Series 2002-29, 1.05% due
11/01/2010 (b) 15,000
Detroit Michigan, City School District (h):
4,615 GO, VRDN, Series A, 1.16% due 5/01/2029 (e) 4,615
46,715 MERLOTS, Series A-113, 1.15% due 5/01/2029 46,715
9,755 Detroit, Michigan, Sewer Disposal Revenue Refunding Bonds, MSTR, VRDN,
SGB 47-A, 1.15% due 7/01/2028 (e)(h) 9,755
Kent Hospital Finance Authority, Michigan, Revenue Refunding Bonds
(Spectrum Health), VRDN (f)(h):
24,200 Series B, 1.10% due 1/15/2026 24,200
16,800 Series C, 1.10% due 1/15/2026 16,800
Michigan Municipal Bond Authority Revenue Bonds:
11,000 Series B-1, 2% due 8/20/2004 11,095
24,000 Series B-2, 2% due 8/23/2004 24,207
22,000 Michigan State Hospital Finance Authority, Revenue Refunding Bonds, MERLOTS,
Series K, 1.15% due 11/15/2023 (f)(h) 22,000
16,505 Municipal Securities Trust Certificates, Revenue Refunding Bonds (Michigan
State Hospital), VRDN, Series 1997-24, Class A, 1.14% due 12/01/2005 (e)(h) 16,505
76,920 Wayne Charter County, Michigan, Airport Revenue Bonds (Detroit Metropolitan
Wayne County), VRDN, AMT, Series A, 1.10% due 12/01/2032 (b)(h) 76,920
CMA TAX-EXEMPT FUND, SEPTEMBER 30, 2003
Schedule of Investments (continued) Master Tax-Exempt Trust (In Thousands)
Face
State Amount Municipal Bonds Value
Minnesota--1.1% $ 24,950 City of Rochester, Minnesota, Series 2001 C, CP, 0.95% due 10/01/2003 $ 24,950
5,000 Minnesota Rural Water Finance Authority, Public Projects Construction Notes,
Series A, 1.75% due 12/15/2003 5,007
81,000 Rochester, Minnesota, Health Care Facilities Revenue Bonds, CP, 1.03% due 1
0/06/2003 81,000
Mississippi--1.5% 7,000 Jackson County, Mississippi, Industrial Sewer Facilities Revenue Bonds
(Chevron U.S.A. Inc. Project), VRDN, AMT, 1.20% due 12/15/2024 (h) 7,000
26,705 Jackson County, Mississippi, Port Facility Revenue Refunding Bonds (Chevron
U.S.A. Inc. Project), VRDN, 1.15% due 6/01/2023 (h) 26,705
7,100 Mississippi Business Finance Corporation, Mississippi Solid Waste Disposal
Revenue Bonds (Mississippi Power Company Project), VRDN, AMT, 1.20% due
7/01/2025 (h) 7,100
3,520 Mississippi Business Finance Corporation, Mississippi, Solid Waste Disposal
Revenue Refunding Bonds (Mississippi Power Company Project), VRDN, AMT, 1.20%
due 5/01/2028 (h) 3,520
12,500 Mississippi Home Corporation, Lease Purpose Revenue Bonds, VRDN, 1.18%
due 10/01/2007 (h) 12,500
46,565 Mississippi Home Corporation, S/F Revenue Bonds, FLOATS, AMT, Series 714,
1.21% due 10/03/2005 (h) 46,565
Mississippi Hospital Equipment and Facilities Authority Revenue Bonds, VRDN (h):
18,700 (Baptist Memorial Hospital Project), 1.11% due 5/01/2021 18,700
25,900 (Mississippi Baptist Medical Center), 1.12% due 7/01/2012 25,900
Missouri--0.9% 40,000 Lees Summit, Missouri, M/F Housing Revenue Bonds (Affordable Housing Acquisition),
VRDN, Series A, 1.34% due 7/01/2046 (h) 40,000
37,800 Missouri Higher Education Loan Authority, Student Loan Revenue Bonds, VRDN,
AMT, Series B, 1.10% due 6/01/2020 (h) 37,800
10,630 Missouri-Illinois Bi-State Development Agency, Metropolitan District Revenue
Bonds, PUTTERS, Series 311, 1.16% due 10/01/2013 (h) 10,630
Nebraska--1.1% 41,350 Lincoln, Nebraska, Electric System Revenue Bonds, CP, 0.90% due 10/08/2003 41,350
4,995 Nebhelp Inc., Nebraska, Revenue Bonds, ROCS, AMT, Series II-R-205, 1.20% due
6/01/2013 (f)(h) 4,995
37,400 Nebraska Public Power District Revenue Bonds, CP, 0.92% due 10/07/2003 37,400
4,995 Nebraska Public Power District, Revenue Refunding Bonds, ROCS, Series II-R-209,
1.15% due 1/01/2012 (f)(h) 4,995
24,750 Omaha, Nebraska, Public Power District, Electric Revenue Bonds, CP, 0.90% due
10/14/2003 24,750
Nevada--1.7% 29,185 ABN Amro Munitops Certificates Trust, Clark County, Nevada Airport, VRDN,
Series 1999-15, 1.18% due 1/02/2008 (f)(h) 29,185
71,780 Clark County, Nevada, Airport Improvement Revenue Refunding Bonds, VRDN,
Series A, 1.10% due 7/01/2012 (f)(h) 71,780
3,835 Clark County, Nevada, GO, ROCS, Series II-R-4012, 1.20% due 7/01/2023 (a)(h) 3,835
12,500 Clark County, Nevada, IDR (Southwest Gas Corporation Project), VRDN, AMT,
Series B, 1.20% due 3/01/2038 (h) 12,500
9,060 Las Vegas Valley, Nevada, Water District, GO, Refunding, MERLOTS, Series B-10,
1.15% due 6/01/2024 (f)(h) 9,060
6,705 Nevada Housing Division Revenue Bonds (Multi-Unit Housing-Mesquite), VRDN,
AMT, Series B, 1.35% due 5/01/2028 (h) 6,705
7,345 Washoe County, Nevada, School District, GO, ROCS, Series II-R-2012, 1.15%
due 6/01/2020 (b)(h) 7,345
New Hampshire-- 2,640 Manchester, New Hampshire, School Facilities Revenue Bonds, ROCS,
0.5% Series II-R-5018, 1.15% due 6/01/2022 (f)(h) 2,640
30,000 New Hampshire Health and Educational Facilities Authority, Revenue Refunding
Bonds (Dartmouth Hitchcock Obligation), VRDN, Series A, 1.05% due 8/01/2031 (e)(h) 30,000
5,475 New Hampshire Higher Educational and Health Facilities Authority Revenue
Refunding Bonds, FLOATS, Series 772, 1.14% due 1/01/2017 (b)(h) 5,475
7,415 New Hampshire State Business Finance Authority, Resource Recovery Revenue
Refunding Bonds (Wheelabrator), VRDN, Series A, 1.10% due 1/01/2018 (h) 7,415
New Jersey-- 15,000 Bayonne, New Jersey, GO, TAN, 2.50% due 10/22/2003 15,009
1.4% 90,000 New Jersey State, TRAN, Series 2004-A, 2% due 6/25/2004 90,637
25,000 New Jersey State Turnpike Authority, Turnpike Revenue Bonds, VRDN, Series C-2,
1.08% due 1/01/2024 (e)(h) 25,000
12,510 Union County Improvement Authority, Mortgage Revenue Bonds (Cedar Glen Housing
Corporation), VRDN, AMT, Series A, 1.10% due 12/15/2034 (h) 12,510
CMA TAX-EXEMPT FUND, SEPTEMBER 30, 2003
Schedule of Investments (continued) Master Tax-Exempt Trust (In Thousands)
Face
State Amount Municipal Bonds Value
New Mexico--0.3% $ 30,000 Bernalillo County, New Mexico, GO, TRAN, Series A, 2% due 12/15/2003 $ 30,051
New York--6.2% 19,720 Babylon, New York, IDA, Residential Recovery Revenue Refunding Bonds
(Ogden Martin Project), VRDN, 1.15% due 1/01/2019 (e)(h) 19,720
15,000 Binghamton, New York, GO, Refunding, BAN, 2% due 9/24/2004 15,133
35,000 Buffalo, New York, GO, RAN, Series A, 2.75% due 7/29/2004 35,481
10,000 Central Islip, New York, Union Free School District, GO, TAN, 1.50% due
6/25/2004 10,041
24,700 Eagle Tax-Exempt Trust, New York State (Memorial Sloan), VRDN, Series 98,
Class 3202, 1.11% due 7/01/2023 (h) 24,700
9,100 Elmont, New York, Union Free School district, GO, TAN, 1.50% due 6/29/2004 9,117
19,000 Freeport, New York, GO, Refunding, BAN, Series A, 1.75% due 1/22/2004 19,026
9,000 Kings Park, New York, Central School District, GO, TAN, 1.25% due 6/29/2004 9,011
13,000 Long Island Power Authority, New York, Electric System Revenue Bonds, VRDN,
Series H, 1.05% due 12/01/2029 (e)(h) 13,000
130,200 Metropolitan Transportation Authority, New York, Dedicated Tax Fund Revenue
Refunding Bonds, VRDN, Series B, 1.07% due 11/01/2022 (e)(h) 130,200
14,835 Metropolitan Transportation Authority, New York, Service Contract Revenue
Refunding Bonds, FLOATS, Series 741, 1.10% due 1/01/2017 (f)(h) 14,835
25,000 Monroe County, New York, GO, RAN, 1.75% due 4/15/2004 25,080
17,600 Monroe County, New York, Public Improvement, GO, BAN, 2% due 12/19/2003 17,631
Municipal Securities Trust Certificates Revenue Bonds, VRDN (h):
26,045 AMT, Series 2000-93, Class A, 1.18% due 10/04/2012 (a) 26,045
13,995 Series 2002-202, Class A, 1.10% due 10/21/2010 (b) 13,995
21,500 New York City, New York, City Municipal Water Finance Authority, Water and
Sewer System Revenue Refunding Bonds, MSTR, VRDN, Series SGB-27, 1.11% due
6/15/2024 (e)(h) 21,500
63,000 New York City, New York, City Transitional Finance Authority, BAN, Refunding,
Series 2, 2% due 2/19/2004 63,225
1,144 New York City, New York, City Transitional Finance Authority, Revenue Refunding
Bonds (New York City Recovery), VRDN, Series 3, Sub-Series 3-H, 1.10% due
11/01/2022 (h) 1,144
New York State, HFA, Housing Revenue Bonds, VRDN (h):
7,000 (Liberty Street Realty LLC), 1.05% due 11/01/2035 7,000
26,100 (West 33rd Street Housing), AMT, Series A, 1.05% due 11/15/2036 (d) 26,100
17,500 New York State, HFA, Service Contract Revenue Refunding Bonds, VRDN,
Series B, 1.03% due 3/15/2026 (h) 17,500
16,885 New York State Local Government Assistance Corporation, Revenue Refunding
Bonds, Sub-Lien, VRDN, Series 8V, 1.05% due 4/01/2019 (h) 16,885
5,995 New York State Power Authority Revenue Bonds, ROCS, Series II-R-210, 1.15% due
11/15/2015 (f)(h) 5,995
5,000 Oyster Bay, New York, GO, Refunding, BAN, Series A, 2.25% due 1/23/2004 5,020
12,437 Solvay, New York, Union Free School District, GO, Refunding, BAN, 1.40%
due 7/20/2004 12,476
10,000 Triborough Bridge and Tunnel Authority, New York, General Purpose Revenue
Refunding Bonds, VRDN, Series B, 1.05% due 1/01/2032 (a)(h) 10,000
28,860 Triborough Bridge and Tunnel Authority, New York, Revenue Bonds, FLOATS,
Series 729, 1.10% due 11/15/2019 (f)(h) 28,860
31,900 William Floyd Union Free School District, Mastics-Moriches-Shirley, GO, TAN,
1.25% due 6/25/2004 31,934
North Carolina-- 19,995 Municipal Securities Trust Certificates, North Carolina Eastern Municipal
0.4% Power Agency, VRDN, Series 2002-201, Class A, 1.12% due 4/12/2017 (h) 19,995
10,000 Municipal Securities Trust Certificates, North Carolina, GO, VRDN,
Series 2001-125, Class A, 1.11% due 7/23/2015 (h) 10,000
8,165 North Carolina Eastern Municipal Power Agency, Power System Revenue Bonds,
MERLOTS, Series A22, 1.15% due 1/01/2024 (f)(h) 8,165
4,500 Wake County, North Carolina, Industrial Facilities and Pollution Control
Financing Authority Revenue Bonds (Solid Waste Disposal--Highway 55), VRDN,
AMT, 1.20% due 9/01/2013 (h) 4,500
North Dakota-- 9,610 North Dakota Rural Water Finance Corporation, Public Projects Construction
0.2% Notes, 2% due 10/15/2004 9,691
6,345 Oliver City, North Dakota, PCR, Refunding, MERLOTS, Series B07, 1.15% due
1/01/2027 (a)(h) 6,345
CMA TAX-EXEMPT FUND, SEPTEMBER 30, 2003
Schedule of Investments (continued) Master Tax-Exempt Trust (In Thousands)
Face
State Amount Municipal Bonds Value
Ohio--1.6% Clinton County, Ohio, Hospital Revenue Bonds (Ohio Hospital Capital Asset
Inc. Pooled Loan), VRDN (h):
$ 1,535 1.38% due 6/01/2028 $ 1,535
6,345 1.18% due 7/01/2029 6,345
70,000 Dayton, Ohio, City School District, School Facilities and Construction, BAN,
2% due 10/16/2003 70,030
22,275 Eagle Tax-Exempt Trust, Ohio State Turnpike, VRDN, Series 98, Class 3503,
1.15% due 2/15/2026 (h) 22,275
10,500 Eagle Tax-Exempt Trust, Ohio, Water Authority Revenue Bonds (Ohio Edison),
VRDN, Series 95, Class 3502, 1.15% due 7/01/2015 (h) 10,500
28,000 Hamilton County, Ohio, Health Care Facilities Revenue Bonds (Twin Towers and
Twin Lakes), VRDN, Series A, 1.05% due 7/01/2023 (h) 28,000
1,765 Ohio HFA, M/F Housing Revenue Bonds (Kenwood Congregate-Retire), VRDN, 0.95%
due 12/01/2015 (h) 1,765
Ohio State Air Quality Development Authority Revenue Refunding Bonds
(Cincinnati Gas and Electric), VRDN (h):
7,900 Series A, 1.50% due 9/01/2030 7,900
7,600 Series B, 1.45% due 9/01/2030 7,600
5,000 Ohio State, GO, FLOATS, Series 603, 1.14% due 9/15/2020 (e)(h) 5,000
Oklahoma--1.6% 14,737 Comanche County, Oklahoma, Home Finance Authority, S/F Mortgage Revenue Bonds,
VRDN, Series A, 1.181% due 4/01/2004 (h) 14,737
7,500 Grand Gateway, Oklahoma, Home Finance Authority, S/F Mortgage Revenue Bonds,
VRDN, Series A, 1.155% due 2/01/2006 (h) 7,500
Moore, Oklahoma, EDA, S/F Mortgage Revenue Bonds, VRDN (h):
7,000 Series A, 0.909% due 4/08/2004 7,000
2,900 Series B-R-3, 0.909% due 12/11/2003 2,900
35,000 Oklahoma County, Oklahoma, Finance Authority Revenue Bonds (Oklahoma County
Housing Preservation), VRDN, 1.25% due 1/01/2033 (h) 35,000
26,132 Oklahoma County, Oklahoma, Home Financing Authority, S/F Mortgage Revenue Bonds,
VRDN, Series A, 1.182% due 5/01/2006 (h) 26,132
8,680 Oklahoma State Industries Authority, Revenue Refunding Bonds (Integris Baptist),
VRDN, Series B, 1.13% due 8/15/2029 (f)(h) 8,680
31,000 Oklahoma State Water Resource Board, State Loan Program Revenue Bonds, VRDN,
Series A, 0.87% due 4/01/2004 (h) 31,000
7,000 Rogers County, Oklahoma, HFA, Revenue Bonds, Series A, 1.104% due 12/01/2003 7,000
Tulsa County, Oklahoma, Home Finance Authority, S/F Mortgage Revenue Bonds,
VRDN (h):
8,200 Series A, 1.186% due 4/01/2004 8,200
15,000 Series G, 1.14% due 12/01/2003 15,000
Oregon--0.2% 11,730 ABN Amro Munitops Certificates Trust, Portland, Oregon, GO, VRDN,
Series 2001-4, 1.15% due 6/01/2009 (f)(h) 11,730
4,250 Gilliam County, Oregon, Solid Waste Disposal Revenue Bonds (Waste Management
Inc. Project), VRDN, 1.15% due 7/01/2027 (h) 4,250
7,170 Oregon State Health, Housing, Educational and Cultural Facilities Authority
Revenue Bonds (Sacred Heart Medical Center), VRDN, Series A, 1.05% due
11/01/2028 (h) 7,170
Pennsylvania-- 37,330 Allegheny County, Pennsylvania, GO, Refunding, VRDN, Series C-50, 1.30% due
3.3% 5/03/2004 (h) 37,330
2,500 Butler County, Pennsylvania, IDA, IDR, Refunding (Wetterau Finance Co. Project),
VRDN, 1.12% due 12/01/2014 (h) 2,500
25,240 Dauphin County, Pennsylvania, General Authority, Revenue Refunding Bonds
(School District Pooled Financing Program II), VRDN, 1.08% due 9/01/2032 (a)(h) 25,240
Delaware Valley, Pennsylvania, Regional Finance Authority, Local Government
Revenue Bonds, VRDN (h):
15,600 Mode 1, 1.10% due 8/01/2016 15,600
15,100 Series B, 1.10% due 12/01/2020 15,100
5,400 Series C, 1.10% due 12/01/2020 5,400
15,150 Series D, 1.10% due 12/01/2020 15,150
18,735 Eagle Tax-Exempt Trust, Pennsylvania, GO, VRDN, Series 94, Class 3803, 1.15%
due 5/01/2008 (h) 18,735
Emmaus, Pennsylvania, General Authority Revenue Bonds, VRDN (h):
13,200 (Pennsylvania Loan Program), Series A, 1.10% due 3/01/2030 (e) 13,200
7,500 Series D, 1.09% due 3/01/2024 7,500
600 Series G, 1.09% due 3/01/2024 600
CMA TAX-EXEMPT FUND, SEPTEMBER 30, 2003
Schedule of Investments (continued) Master Tax-Exempt Trust (In Thousands)
Face
State Amount Municipal Bonds Value
Pennsylvania $ 12,020 Erie County, Pennsylvania, Hospital Authority Revenue Bonds, FLOATS,
(concluded) Series 820, 1.14% due 7/01/2022 (f)(h) $ 12,020
12,000 Lackawanna County, Pennsylvania, GO, MSTR, VRDN, Series SGB-38, 1.15% due
9/15/2020 (h) 12,000
5,000 Mount Lebanon, Pennsylvania, School District, GO, MERLOTS, Series B19,
1.15% due 2/15/2027 (f)(h) 5,000
Pennsylvania State Higher Education Assistance Agency, Student Loan Revenue
Bonds, VRDN, Series A (h):
18,700 1.05% due 12/01/2025 18,700
50,000 AMT, 1.10% due 6/01/2029 (a) 50,000
Pennsylvania State Turnpike Commission, Turnpike Revenue Refunding Bonds,
VRDN (h):
20,000 Series A-1, 1.08% due 12/01/2030 20,000
8,800 Series A-3, 1.08% due 12/01/2030 8,800
11,700 Series B, 1.10% due 12/01/2012 11,700
10,000 Philadelphia, Pennsylvania, Water and Wastewater Revenue Refunding Bonds,
VRDN, 1.10% due 6/15/2023 (e)(h) 10,000
22,000 Temple University of the Commonwealth System of Higher Education, Pennsylvania,
University Funding Obligation Revenue Bonds, 1.20% due 5/04/2004 22,000
Rhode Island-- Rhode Island State and Providence Plantations, GO, FLOATS (h):
0.4% 26,160 Series 568, 1.14% due 9/01/2017 (f) 26,160
16,135 Series 720, 1.14% due 11/01/2022 (b) 16,135
South Carolina-- Berkeley County, South Carolina, Exempt Facilities, Industrial Revenue Bonds
2.1% (Amoco Chemical Company Project), VRDN, AMT (h):
15,300 1.20% due 4/01/2027 15,300
5,700 1.20% due 4/01/2028 5,700
118,000 Charleston County, South Carolina, School District, GO, BAN, 2% due 2/25/2004 118,421
7,500 Dorchester County, South Carolina, GO, TAN, 1.75% due 4/15/2004 7,530
Florence County, South Carolina, Solid Waste Disposal and Wastewater Treatment
Revenue Bonds (Roche Carolina Inc. Project), VRDN, AMT (h):
35,000 1.20% due 4/01/2026 35,000
19,200 1.20% due 4/01/2027 19,200
12,500 South Carolina Transportation Infrastructure Bank Revenue Bonds, FLOATS,
Series 728, 1.14% due 10/01/2022 (a)(h) 12,500
South Dakota-- 13,300 Lawrence County, South Dakota, Solid Waste Disposal Revenue Bonds (Homestake
0.1% Mining), VRDN, AMT, Series A, 1.20% due 7/01/2032 (h) 13,300
Tennessee--5.5% Blount County, Tennessee, Public Building Authority, Local Government Public
Improvement Revenue Bonds, VRDN (a)(h):
2,300 Series A-1-D, 1.20% due 6/01/2025 2,300
8,000 Series A-2E, 1.20% due 6/01/2035 8,000
Clarksville, Tennessee, Public Building Authority Revenue Bonds, Pooled
Financing (Tennessee Municipal Bond Fund), VRDN (h):
41,995 1.10% due 11/01/2027 41,995
75,500 1.10% due 6/01/2029 75,500
65 1.15% due 7/01/2031 65
Knoxville, Tennessee, Utilities Board Revenue Bonds, VRDN (e)(h):
15,915 (Sub-Gas System), 1.18% due 1/15/2005 15,915
18,625 (Sub-Wastewater System), 1.18% due 1/15/2005 18,625
8,100 Loudon, Tennessee, IDB, PCR, Refunding (A.E. Staley Manufacturing Company
Project), VRDN, 1.05% due 6/01/2023 (h) 8,100
6,450 Memphis, Tennessee, Health, Educational and Housing Facility Board, M/F Housing
Revenue Bonds (Chickasaw Place Apartments), VRDN, AMT, 1.23% due 6/01/2033 (h) 6,450
25,000 Memphis, Tennessee, Health, Educational and Housing Facility Board Revenue Bonds
(Not-for-Profit M/F Program), VRDN, 1.25% due 8/01/2032 (h) 25,000
4,410 Metropolitan Government of Nashville and Davidson County, Tennessee, Health
and Education Facilities Board Revenue Bonds, FLOATS, Series 533, 1.13% due
11/15/2016 (e)(h) 4,410
Montgomery County, Tennessee, Public Building Authority, Pooled Financing
Revenue Bonds, VRDN (h):
2,980 (Montgomery County Loan), 1.10% due 7/01/2019 2,980
30,375 (Tennessee County Loan Pool), 1.10% due 11/01/2027 30,375
CMA TAX-EXEMPT FUND, SEPTEMBER 30, 2003
Schedule of Investments (continued) Master Tax-Exempt Trust (In Thousands)
Face
State Amount Municipal Bonds Value
Tennessee Sevier County, Tennessee, Public Building Authority Revenue Bonds, Local
(concluded) Government Public Improvement, VRDN (h):
$ 69,900 AMT, Series III-A, 1.23% due 6/01/2028 (a) $ 69,900
7,100 Series II-A-1, 1.10% due 6/01/2024 (a) 7,100
5,105 Series II-E-2, 1.10% due 6/01/2021 (a) 5,105
15,000 Series II-F-3, 1.10% due 6/01/2005 (a) 15,000
10,000 Series III-D-2, 1.10% due 6/01/2017 (a) 10,000
4,525 Series III-D-6, 1.10% due 6/01/2020 (a) 4,525
19,035 Series III-E-1, 1.10% due 6/01/2025 19,035
10,000 Series III-E-4, 1.10% due 6/01/2025 10,000
Shelby County, Tennessee, CP:
32,400 GO, Series 01, 0.93% due 11/06/2003 32,400
11,000 Series 1999-A, 0.90% due 10/09/2003 11,000
12,000 Shelby County, Tennessee, Health, Educational and Housing Facilities Board
Revenue Bonds (Hutchison School Project), VRDN, 1.12% due 5/01/2026 (h) 12,000
Tennessee HDA, S/F Mortgage Revenue Bonds, VRDN (h):
5,285 Series CN1-R1, 0.909% due 12/08/2005 5,285
1,090 Series CN1-R2, 0.909% due 12/08/2005 1,090
93,635 Series CN1-R4, 0.909% due 6/10/2004 93,635
21,000 Tennessee State Local Development Authority Revenue Bonds (Student Loan
Program), BAN, Series A, 2% due 6/07/2004 21,145
Texas--13.9% ABN Amro Munitops, Certificates Trust, VRDN (h):
9,030 Grapevine, Texas, Permanent School Fund, GO, Series 2001-8, 1.18% due
2/15/2007 9,030
15,750 Houston, Texas, Airport Revenue, AMT, Series 1998-15, 1.22% due 7/05/2006 (b) 15,750
29,950 San Antonio, Texas, Independent School District, Series 1999-10, 1.18%
due 3/07/2007 (f) 29,950
5,075 Aldine, Texas, Independent School District, GO, Refunding, ROCS, Series II-R-158,
1.15% due 2/15/2020 (h) 5,075
16,561 Austin, Texas, Utility System Revenue Bonds, CP, Series A, 0.90% due 10/07/2003 16,561
7,445 Austin, Texas, Utility System Revenue Refunding Bonds, ROCS, Series II-R-159,
1.15% due 5/15/2014 (e)(h) 7,445
13,845 Bexar County, Texas, Revenue Bonds, FLOATS, Series 454, 1.14% due 8/15/2008 (f)(h) 13,845
10,000 Brazos River Authority, Texas, Harbor Navigational District, Brazoria County
Revenue Bonds (BASF Corp.), VRDN, AMT, 1.25% due 4/01/2032 (h) 10,000
25,000 Brazos River, Texas, Harbor Industrial Development Corporation Revenue Bonds
(BASF Corporation Project), VRDN, AMT, 1.20% due 5/01/2038 (h) 25,000
Cameron County, Texas, Housing Finance Corporation, S/F Mortgage Revenue
Bonds, VRDN (h):
5,000 1.15% due 9/01/2006 5,000
9,925 AMT, Series A, 0.974% due 6/01/2004 9,925
17,811 Central Texas Housing Finance Corporation, S/F Mortgage Revenue Bonds, AMT, VRDN,
Series A, 1.156% due 7/01/2004 (h) 17,811
7,435 Corpus Christi, Texas, Business and Job Development Corporation, Sales Tax
Revenue Refunding Bonds, ROCS, Series II-R-2001, 1.15% due 9/01/2017 (a)(h) 7,435
4,000 Corpus Christi, Texas, Industrial Development Corp., IDR (Dedietrich USA
Incorporated Project), VRDN, AMT, 1.25% due 11/01/2008 (h) 4,000
6,995 Dallas, Texas, Independent School District, GO, Refunding, FLOATS, Series 794,
1.14% due 2/15/2019 (h) 6,995
Dallas-Fort Worth, Texas, International Airport Revenue Bonds, AMT (h):
3,000 FLOATS, Series 824, 1.21% due 11/01/2015 (a) 3,000
7,140 PUTTERS, Series 350, 1.15% due 5/01/2011 (f) 7,140
2,500 PUTTERS, Series 351, 1.20% due 5/01/2008 (e) 2,500
Dallas-Fort Worth, Texas, Regional Airport Revenue Bonds, MSTR, VRDN, AMT (f)(h):
25,300 Series SGB-49, 1.18% due 11/01/2023 25,300
9,495 Series SGB-52, 1.17% due 11/01/2017 9,495
Dallas-Fort Worth, Texas, Regional Airport Revenue Refunding Bonds, MSTR, VRDN (h):
23,885 AMT, Series SGB-46, 1.17% due 11/01/2020 (f) 23,885
6,600 Series SGB-52, 1.15% due 11/01/2015 (b) 6,600
6,000 Eagle Tax-Exempt Trust, Dallas, Texas, VRDN, Series 01, Class 4310, 1.15% due
12/01/2026 (h) 6,000
8,435 Eagle Tax-Exempt Trust, Dallas-Fort Worth, Texas, International Airport Revenue
Bonds, AMT, Series 2003-0020, Class A, 1.20% due 11/01/2032 (a) 8,435
9,900 Eagle Tax-Exempt Trust, Dallas-Fort Worth, Texas, VRDN, Series 96C, Class 4301,
1.15% due 11/01/2005 (h) 9,900
CMA TAX-EXEMPT FUND, SEPTEMBER 30, 2003
Schedule of Investments (continued) Master Tax-Exempt Trust (In Thousands)
Face
State Amount Municipal Bonds Value
Texas $ 4,915 Eagle Tax-Exempt Trust, San Antonio, Texas, VRDN, Series 01, Class 4311,
(continued) 1.15% due 8/15/2026 (h) $ 4,915
10,747 El Paso County, Texas, Housing Finance Corporation, S/F Mortgage Revenue
Bonds, VRDN, Series A, 0.909% due 12/11/2003 (h) 10,747
4,500 Fort Bend County, Texas, GO, MSTR, VRDN, SGB-46-A, 1.15% due 3/01/2032 (f)(h) 4,500
5,300 Grapevine, Texas, Industrial Development Corporation, Airport Revenue
Refunding Bonds (Southern Air Transport), VRDN, 1.10% due 3/01/2010 (h) 5,300
7,300 Gulf Coast IDA, Texas, Marine Terminal Revenue Bonds (Amoco Oil Company Project),
VRDN, AMT, 1.20% due 4/01/2028 (h) 7,300
7,400 Gulf Coast IDA, Texas, Solid Waste Disposal Revenue Bonds (Citgo Petroleum
Corporation Project), VRDN, AMT, 1.22% due 4/01/2026 (h) 7,400
Gulf Coast Waste Disposal Authority, Texas, Environmental Facilities Revenue
Bonds, VRDN, AMT (h):
19,000 (American Acryl LP Project), 1.20% due 5/01/2038 19,000
25,000 (American Acryl LP Project), Series B, 1.15% due 9/01/2036 25,000
2,200 (BP Amoco Chemical Company), 1.20% due 5/01/2038 2,200
8,400 (BP Products North America Project), 1.20% due 7/01/2034 8,400
8,000 (BP Products North America Project), 1.20% due 7/01/2036 8,000
Gulf Coast Waste Disposal Authority, Texas, Environmental Facilities Revenue
Refunding Bonds (Amoco Oil Company Project), VRDN, AMT (h):
13,800 1.20% due 1/01/2026 13,800
14,700 1.20% due 1/01/2026 14,700
36,300 Gulf Coast Waste Disposal Authority, Texas, PCR (Amoco Oil Company Project),
VRDN, AMT, 1.20% due 6/01/2024 (h) 36,300
12,500 Gulf Coast, Waste Disposal Authority, Texas, Revenue Bonds (Air Products
Project), VRDN, AMT, 1.26% due 3/01/2035 (h) 12,500
17,710 Harris County, Texas, FLOATS, Series SG-45, 1.13% due 8/15/2016 (h) 17,710
13,000 Harris County, Texas, Health Facilities Development Corporation, Revenue
Refunding Bonds (Methodist Hospital), VRDN, 1.10% due 12/01/2032 (h) 13,000
Harris County, Texas, Industrial Development Corporation, Solid Waste
Disposal Revenue Bonds, VRDN, AMT (h):
12,500 (Deer Park), Series 95-B, 1.24% due 3/01/2023 12,500
46,100 (Deer Park Limited Partnership), Series A, 1.24% due 2/01/2023 46,100
10,380 Harris County, Texas, Revenue Refunding Bonds, ROCS, Series II-R-1030,
1.15% due 8/15/2017 (e)(h) 10,380
75,000 Houston, Texas Independent School District, GO, Refunding, VRDN, 1.05%
due 6/03/2004 (h) 74,979
Houston, Texas, Water and Sewer System Revenue Bonds:
16,500 CP, Series A, 0.90% due 10/29/2003 16,500
7,830 MERLOTS, Series A-128, 1.15% due 12/01/2029 (f)(h) 7,830
3,390 Irving, Texas, Independent School District, GO, Refunding, ROCS,
Series II-R-2028, 1.15% due 2/15/2022 (h) 3,390
4,860 Middle Rio Grande, Texas, Housing Finance Corporation, S/F Revenue Bonds,
FLOATS, AMT, Series 709, 1.21% due 8/02/2004 (h) 4,860
10,395 Municipal Securities Trust Certificates, Austin, Texas, Water Revenue Refunding
Bonds, VRDN, Series 2001-134, Class A, 1.14% due 5/15/2010 (e)(h) 10,395
North Texas Higher Education Authority Inc., Student Loan Revenue Bonds, VRDN,
AMT (a)(h):
12,800 Series C, 1.10% due 4/01/2020 12,800
13,700 Series F, 1.10% due 4/01/2020 13,700
26,000 North Texas Higher Education Authority Inc., Student Loan Revenue Refunding
Bonds, VRDN, AMT, 1.10% due 12/01/2032 (h) 26,000
3,000 North Texas Thruway Authority, Dallas, North Thruway Systems, Revenue
Refunding Bonds, VRDN, Series II-R-166, 1.15% due 1/01/2016 (b)(h) 3,000
Panhandle-Plains, Texas, Higher Education Authority Incorporated, Student
Loan Revenue Bonds, VRDN, AMT (h):
34,800 Series A, 1.10% due 6/01/2021 34,800
3,300 Series B, 1.10% due 6/01/2021 (f) 3,300
7,100 Panhandle-Plains, Texas, Higher Education Authority Incorporated, Student
Loan Revenue Refunding Bonds, VRDN, AMT, Series A, 1.10% due 6/01/2008 (h) 7,100
5,000 Pasadena, Texas, Independent School District, GO, VRDN, Series A, 1.35% due
4/01/2004 (h) 5,000
17,335 Port Arthur, Texas, Navigation District, Environmental Facilities Revenue
Refunding Bonds (Motiva Enterprises Project), VRDN, AMT, 1.15% due 12/01/2027 (h) 17,335
10,000 Port Arthur, Texas, Navigation District, Industrial Development Corporation,
Exempt Facilities Revenue Bonds (Air Products and Chemicals Project),
VRDN, AMT, 1.26% due 4/01/2036 (h) 10,000
CMA TAX-EXEMPT FUND, SEPTEMBER 30, 2003
Schedule of Investments (continued) Master Tax-Exempt Trust (In Thousands)
Face
State Amount Municipal Bonds Value
Texas Port Arthur, Texas, Navigation District Revenue Bonds, VRDN, AMT (h):
(concluded) $ 20,000 (BASF Corporation Project), 1.25% due 4/01/2033 $ 20,000
10,000 Multi-Mode (Atofina Petrochemicals), Series B, 1.30% due 4/01/2027 10,000
19,200 Port Corpus Christi, Texas, Industrial Development Corporation, Environmental
Facilities Revenue Bonds (Citgo Petroleum Corporation Project), VRDN, AMT,
1.22% due 8/01/2028 (h) 19,200
50,000 Port Corpus Christi, Texas, Nueces County Solid Waste Disposal Revenue
Refunding Bonds (Flint Hills Resources), VRDN, AMT, Series A, 1.45% due
7/01/2029 (h) 50,000
10,000 San Antonio, Texas, Hotel Occupancy Revenue Bonds, FLOATS, Series SG-51,
1.13% due 8/15/2019 (h) 10,000
8,700 Southwest Texas, Higher Education Authority Incorporated Revenue Refunding
Bonds (Southern Methodist University), VRDN, 1.15% due 7/01/2015 (h) 8,700
13,080 Southeast Texas Housing Finance Corporation Revenue Bonds, FLOATS, AMT,
Series 661, 1.21% due 4/01/2005 (h) 13,080
11,070 Southeast Texas Housing Finance Corporation, Revenue Refunding Bonds,
VRDN, Series R-3, 0.918% due 3/11/2004 (h) 11,070
45,000 Texas State College Student Loan, GO, Refunding, VRDN, 0.95% due 7/01/2004 (h) 45,000
7,195 Texas State, GO, Refunding, FLOATS, Series 657, 1.14% due 4/01/2010 (h) 7,195
11,890 Texas State, GO, Refunding (Veterans Housing Assistance Fund I), VRDN, 1.05%
due 12/01/2016 (h) 11,890
418,500 Texas State, TRAN, 2% due 8/31/2004 421,675
5,510 Texas State University System, Financing Revenue Refunding Bonds, ROCS,
Series II-R-1011, 1.15% due 3/15/2019 (e)(h) 5,510
4,800 West Side Calhoun County, Texas, Navigation District Sewer and Solid Waste
District Revenue Bonds (BP Chemicals Inc. Project), VRDN, AMT, 1.20% due
4/01/2031 (h) 4,800
Utah--0.3% 20,000 Emery County, Utah, PCR, Refunding (Pacificorp Projects), VRDN, 1.25% due
11/01/2024 (a)(h) 20,000
12,500 Weber County, Utah, Hospital Revenue Bonds (IHC Health Services), VRDN,
Series A, 1.10% due 2/15/2031 (h) 12,500
Vermont--0.0% 3,305 Vermont HFA, S/F Revenue Bonds, VRDN, AMT, Series 16 A, 1.21% due 5/01/2032 (e)(h) 3,305
Virginia--1.0% 13,685 Louisa, Virginia, Development Authority, Solid Waste and Sewer Disposal
Revenue Bonds (Virginia Electric and Power Company Project), VRDN, AMT,
Series A, 3.40% due 3/01/2004 (h) 13,817
6,000 Metropolitan Washington, D.C., Airport Authority System Revenue Bonds, ROCS,
Series II-R-195, 1.20% due 10/01/2032 (b)(h) 6,000
13,995 Metropolitan Washington, D.C., Virginia, Airports Authority, General Airport
Revenue Bonds, PUTTERS, AMT, Series 240, 1.10% due 10/01/2021 (f)(h) 13,995
66,400 Norfolk, Virginia, IDA, Revenue Bonds (Pooled Financing Program--Sentrar),
CP, 0.90% due 10/10/2003 66,400
3,320 Virginia State, GO, Refunding, ROCS, Series II-R-170, 1.15% due 6/01/2015 (h) 3,320
Washington--2.5% ABN Amro Munitops Certificates Trust, Seattle, Washington, GO, VRDN (f)(h):
20,000 Series 1998-16, 1.17% due 10/04/2006 20,000
13,500 Series 1998-22, 1.18% due 1/03/2007 13,500
22,900 Clark County, Washington, Public Utility District Number 001, Generating System
Revenue Refunding Bonds, MSTR, VRDN, Series SGA-118, 1.16% due 1/01/2025 (e)(h) 22,900
9,000 Grant County, Washington, Public Utility District Number 002, Electric Revenue
Refunding Bonds, ROCS, Series II-R-2039, 1.15% due 1/01/2019 (e)(h) 9,000
5,280 King County, Washington, School District Number 410, Snoqualmie Valley, GO,
ROCS, Series II-R-4513, 1.15% due 12/01/2020 (e)(h) 5,280
14,810 King County, Washington, Sewer Revenue Refunding Bonds, FLOATS, Series 554,
1.14% due 7/01/2009 (b)(h) 14,810
2,285 Lewis County, Washington, Public Utility District Number 001, Cowlitz Falls
Hydroelectric Revenue Refunding Bonds, ROCS, Series II-R-4026, 1.15% due
10/01/2023 (f)(h) 2,285
14,070 Municipal Securities Trust Certificates, Washington State Motor Vehicle Fuel
Tax, GO, VRDN, Series 2001-112, Class A, 1.16% due 1/07/2021 (h) 14,070
4,985 Port Seattle, Washington, Revenue Bonds, MERLOTS, AMT, Series B 04, 1.20%
due 9/01/2015 (h) 4,985
5,000 Port Seattle, Washington, Special Facilities Revenue Bonds, MERLOTS, AMT,
Series B40, 1.20% due 6/01/2025 (f)(h) 5,000
24,700 Seattle, Washington, Municipal Light and Power Revenue Bonds, RAN, 2.50% due
11/21/2003 24,735
4,995 Seattle, Washington, Water System Revenue Refunding Bonds, ROCS,
Series II-R-4006, 1.15% due 9/01/2022 (f)(h) 4,995
4,945 Snohomish County, Washington, GO, ROCS, Series II-R-1059, 1.15% due
12/01/2020 (f)(h) 4,945
3,500 Spokane County, Washington, Spokane School District Number 081, GO, ROCS,
Series II-R-4000, 1.15% due 12/01/2019 (e)(h) 3,500
CMA TAX-EXEMPT FUND, SEPTEMBER 30, 2003
Schedule of Investments (concluded) Master Tax-Exempt Trust (In Thousands)
Face
State Amount Municipal Bonds Value
Washington $ 14,085 Tacoma, Washington, Water Revenue Refunding Bonds, FLOATS, Series 555, 1.14%
(concluded) due 12/01/2009 (b)(h) $ 14,085
15,075 Washington State, GO, PUTTERS, Series 333, 1.19% due 12/01/2014 (f)(h) 15,075
12,955 Washington State, GO, Refunding, MERLOTS, Series A57, 1.15% due
1/01/2011 (f)(h) 12,955
Washington State Housing Finance Commission, M/F Housing Revenue Bonds,
VRDN, AMT (h):
6,400 (Arbors on the Park Project), 1.25% due 10/01/2024 6,400
9,695 (Courtside Apartments Project), 1.20% due 1/01/2026 9,695
Washington State Public Power Supply Systems, Electric Revenue Refunding
Bonds, VRDN (f)(h):
8,200 (Project Number 2), Series 2A-1, 1.05% due 7/01/2012 8,200
6,155 (Project Number 2), Series 2A-2, 1.05% due 7/01/2012 6,155
4,430 (Project Number 3), Series 3-A, 1% due 7/01/2018 4,430
23,860 Washington State Public Power Supply Systems, Revenue Refunding Bonds
(Nuclear Project Number 1), VRDN, Series 1A-2, 1.05% due 7/01/2017 (h) 23,860
West Virginia-- 10,695 ABN Amro Munitops Certificates Trust, West Virigina State, GO, VRDN,
0.2% Series 2000-12, 1.18% due 6/04/2008 (f)(h) 10,695
11,220 Hancock County, West Virginia, County Commission, IDR, Refunding (The Boc
Group Inc. Project), VRDN, 1.05% due 8/01/2005 (h) 11,220
Wisconsin--1.8% 16,000 Carlton, Wisconsin, PCR, Refunding (Wisconsin Power and Light Company Project),
VRDN, Series B, 1.55% due 9/01/2005 (h) 16,000
14,850 Eagle Tax-Exempt Trust, Wisconsin, Ball Park, VRDN, Series 98, Class 4901,
1.15% due 12/15/2026 (h) 14,850
3,715 Hartland, Wisconsin, IDR (Commercial Communications Inc. Project), VRDN, AMT,
1.35% due 8/01/2009 (h) 3,715
19,000 Pleasant Prairie, Wisconsin, Pollution Revenue Refunding Bonds (Wisconsin
Electric Power Company), VRDN, Series C, 1.35% due 9/01/2030 (h) 19,000
5,000 Wisconsin Housing and Economic Development Authority, Home Ownership Revenue
Bonds, VRDN, AMT, Series B, 1.125% due 9/01/2034 (h) 5,000
7,335 Wisconsin Housing and Economic Development Authority, Home Ownership Revenue
Refunding Bonds, VRDN, AMT, Series E, 1.125% due 3/01/2028 (h) 7,335
6,000 Wisconsin Rural Water Construction Loan, Program Commission Revenue Bonds,
BAN, 2% due 10/15/2004 6,051
Wisconsin State, CP:
10,400 GO, Series 2000-A, 0.93% due 10/9/2003 10,400
12,670 GO, Series 2000-A, 0.95% due 11/6/2003 12,670
26,500 GO, Series 98-B, 0.93% due 12/09/2003 26,500
16,000 GO, Series 98-B, 0.93% due 12/09/2003 16,000
34,935 Series B, 0.90% due 10/06/2003 34,935
14,040 Wisconsin State Transportation Revenue Bonds, ROCS, Series II-R-1021,
1.15% due 7/01/2021 (b)(h) 14,040
Wyoming--0.3% 12,960 Lincoln County, Wyoming, PCR, Refunding (Pacificorp Projects), VRDN, 1.18%
due 11/01/2024 (a)(h) 12,960
16,960 Sweetwater County, Wyoming, PCR, Refunding (Pacificorp Project), VRDN, 1.18%
due 11/01/2024 (a)(h) 16,960
Puerto Rico-- 12,800 Puerto Rico Electric Power Authority, Power Revenue Bonds, MSTR, VRDN,
0.1% Series SGA-43, 1.10% due 7/01/2022 (h) 12,800
Total Investments (Cost--$10,128,198*)--99.8% 10,128,198
Other Assets Less Liabilities--0.2% 17,231
-----------
Net Assets--100.0% $10,145,429
===========
(a)AMBAC Insured.
(b)FGIC Insured.
(c)FHLMC Collateralized.
(d)FNMA Collateralized.
(e)FSA Insured.
(f)MBIA Insured.
(g)Prerefunded.
(h)The interest rate is subject to change periodically based upon
prevailing market rates. The interest rate shown is the rate in
effect at September 30, 2003.
(i)XL Capital Insured.
*Cost for Federal income tax purposes.
See Notes to Financial Statements.
CMA TAX-EXEMPT FUND, SEPTEMBER 30, 2003
Statement of Assets and Liabilities Master Tax-Exempt Trust
As of September 30, 2003
Assets
Investments, at value (identified cost--$10,128,198,028) $ 10,128,198,028
Cash 97,555
Receivables:
Interest $ 26,610,639
Contributions 3,717,078
Securities sold 3,377 30,331,094
-----------------
Prepaid registration fees and other assets 260,017
-----------------
Total assets 10,158,886,694
-----------------
Liabilities
Payables:
Securities purchased 13,190,628
Investment adviser 151,136
Other affiliates 116,384
-----------------
Total liabilities 13,458,148
-----------------
Net Assets
Net assets $ 10,145,428,546
=================
Net Assets Consist of
Investors' capital $ 10,145,428,546
-----------------
Net assets $ 10,145,428,546
=================
See Notes to Financial Statements.
CMA TAX-EXEMPT FUND, SEPTEMBER 30, 2003
Statement of Operations Master Tax-Exempt Trust
For the Six Months Ended September 30, 2003
Investment Income
Interest and amortization of premium and discount earned $ 59,481,816
Expenses
Investment advisory fees $ 7,072,473
Accounting services 444,349
Custodian fees 85,021
Professional fees 24,981
Pricing fees 21,501
Trustees' fees and expenses 20,980
Other 28,463
-----------------
Total expenses 7,697,768
-----------------
Investment income--net 51,784,048
-----------------
Realized Loss on Investments--Net
Realized loss on investments--net (343,508)
-----------------
Net Increase in Net Assets Resulting from Operations $ 51,440,540
=================
See Notes to Financial Statements.
CMA TAX-EXEMPT FUND, SEPTEMBER 30, 2003
Statements of Changes in Net Assets Master Tax-Exempt Trust
For the Six For the Period
Months Ended February 13, 2003++
September 30, to March 31,
Increase (Decrease) in Net Asset Value: 2003 2003
Operations
Investment income--net $ 51,784,048 $ 13,938,742
Realized gain (loss) on investments--net (343,508) 291,802
----------------- -----------------
Net increase in net assets resulting from operations 51,440,540 14,230,544
----------------- -----------------
Capital Transactions
Proceeds from contributions 18,100,705,328 3,757,178,224
Fair value of net asset contributions -- 10,591,437,724
Fair value of withdrawals (18,597,896,705) (3,771,767,109)
----------------- -----------------
Net increase (decrease) in net assets derived from capital
transactions (497,191,377) 10,576,848,839
----------------- -----------------
Net Assets
Total increase (decrease) in net assets (445,750,837) 10,591,079,383
Beginning of period 10,591,179,383 100,000
----------------- -----------------
End of period $ 10,145,428,546 $ 10,591,179,383
================= =================
++Commencement of operations.
See Notes to Financial Statements.
CMA TAX-EXEMPT FUND, SEPTEMBER 30, 2003
Financial Highlights Master Tax-Exempt Trust
For the Six For the Period
Months Ended February 13, 2003++
The following ratios have been derived from September 30, to March 31,
information provided in the financial statements. 2003 2003
Total Investment Return
Total investment return .97%* .68%*
================= =================
Ratios to Average Net Assets
Expenses .15%* .21%*
================= =================
Investment income and realized gain (loss)
on investments--net .97%* 1.04%*
================= =================
Supplemental Data
Net assets, end of period (in thousands) $ 10,145,429 $ 10,591,179
================= =================
*Annualized.
++Commencement of operations.
See Notes to Financial Statements.
CMA TAX-EXEMPT FUND, SEPTEMBER 30, 2003
Notes to Financial Statements
Master Tax-Exempt Trust
1. Significant Accounting Policies:
Master Tax-Exempt Trust (the "Trust") is registered under the
Investment Company Act of 1940, as amended, and is organized as a
Delaware statutory trust. The Declaration of Trust permits the
Trustees to issue nontransferable interest in the Trust, subject to
certain limitations. The Trust's financial statements are prepared
in conformity with accounting principles generally accepted in the
United States of America, which may require the use of management
accruals and estimates. These unaudited financial statements reflect
all adjustments, which are, in the opinion of management, necessary
to a fair statement of the results for the interim period presented.
All such adjustments are of a normal, recurring nature. The
following is a summary of significant accounting policies followed
by the Trust.
(a) Valuation of investments--Investments are valued at amortized
cost, which approximates market value. For the purpose of valuation,
the maturity of a variable rate demand instrument is deemed to be
the demand notice payment period. In the case of a floating rate
instrument, the remaining maturity is the next coupon date on which
the interest rate is to be adjusted.
(b) Income taxes--The Trust is classified as a partnership for
Federal income tax purposes. As such, each investor in the Trust is
treated as owner of its proportionate share of the net assets,
income, expenses and realized and unrealized gains and losses of the
Trust. Therefore, no Federal income tax provision is required. It is
intended that the Trust's assets will be managed so an investor in
the Trust can satisfy the requirements of Subchapter M of the
Internal Revenue Code.
(c) Security transactions and investment income--Security
transactions are recorded on the dates the transactions are entered
into (the trade dates). Realized gains and losses on security
transactions are determined on the identified cost basis. Interest
income (including amortization of premium and discount) is
recognized on the accrual basis.
2. Investment Advisory Agreement and Transactions with Affiliates:
The Trust has entered into an Investment Advisory Agreement with
Fund Asset Management, L.P. ("FAM"). The general partner of FAM is
Princeton Services, Inc. ("PSI"), an indirect, wholly-owned
subsidiary of Merrill Lynch & Co., Inc. ("ML & Co."), which is the
limited partner.
FAM is responsible for the management of the Trust's portfolio and
provides the necessary personnel, facilities, equipment and certain
other services necessary to the operations of the Trust. For such
services, the Trust pays a monthly fee based upon the average daily
value of the Trust's net assets at the following annual rates: .25%
of the Trust's average daily net assets not exceeding $500 million;
..175% of the average daily net assets in excess of $500 million but
not exceeding $1 billion; and .125% of the average daily net assets
in excess of $1 billion.
For the six months ended September 30, 2003, the Trust reimbursed
FAM $77,398 for certain accounting services.
Certain officers and/or trustees of the Trust are officers and/or
directors of FAM, PSI, and/or ML & Co.
CMA TAX-EXEMPT FUND, SEPTEMBER 30, 2003
Item 2 - Did registrant adopt a code of ethics, as of the end of the
period covered by this report, that applies to the registrant's
principal executive officer, principal financial officer, principal
accounting officer or controller, or persons performing similar
functions, regardless of whether these individuals are employed by
the registrant or a third party? If not, why not? Briefly describe
any amendments or waivers that occurred during the period. State
here if code of ethics/amendments/waivers are on website and give
website address-. State here if fund will send code of ethics to
shareholders without charge upon request--N/A (annual requirement
only)
Item 3 - Did the registrant's board of directors determine that the
registrant either: (i) has at least one audit committee financial
expert serving on its audit committee; or (ii) does not have an
audit committee financial expert serving on its audit committee? If
yes, disclose name of financial expert and whether he/she is
"independent," (fund may, but is not required, to disclose name/
independence of more than one financial expert) If no, explain why
not. - N/A (annual requirement only)
Item 4 - Disclose annually only (not answered until December 15,
2003)
(a) Audit Fees - Disclose aggregate fees billed for each of the last
two fiscal years for professional services rendered by the principal
accountant for the audit of the registrant's annual financial
statements or services that are normally provided by the accountant
in connection with statutory and regulatory filings or engagements
for those fiscal years. N/A.
(b) Audit-Related Fees - Disclose aggregate fees billed in each of
the last two fiscal years for assurance and related services by the
principal accountant that are reasonably related to the performance
of the audit of the registrant's financial statements and are not
reported under paragraph (a) of this Item. Registrants shall
describe the nature of the services comprising the fees disclosed
under this category. N/A.
(c) Tax Fees - Disclose aggregate fees billed in each of the last
two fiscal years for professional services rendered by the principal
accountant for tax compliance, tax advice, and tax planning.
Registrants shall describe the nature of the services comprising the
fees disclosed under this category. N/A.
(d) All Other Fees - Disclose aggregate fees billed in each of the
last two fiscal years for products and services provided by the
principal accountant, other than the services reported in paragraphs
(a) through (c) of this Item. Registrants shall describe the nature
of the services comprising the fees disclosed under this category.
N/A.
(e)(1) Disclose the audit committee's pre-approval policies and
procedures described in paragraph (c)(7) of Rule 2-01 of Regulation
S-X. N/A.
(e)(2) Disclose the percentage of services described in each of
paragraphs (b) through (d) of this Item that were approved by the
audit committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of
Regulation S-X. N/A.
(f) If greater than 50%, disclose the percentage of hours expended
on the principal accountant's engagement to audit the registrant's
financial statements for the most recent fiscal year that were
attributed to work performed by persons other than the principal
accountant's full-time, permanent employees. N/A.
(g) Disclose the aggregate non-audit fees billed by the registrant's
accountant for services rendered to the registrant, and rendered to
the registrant's investment adviser (not including any sub-adviser
whose role is primarily portfolio management and is subcontracted
with or overseen by another investment adviser), and any entity
controlling, controlled by, or under common control with the adviser
that provides ongoing services to the registrant for each of the
last two fiscal years of the registrant. N/A.
(h) Disclose whether the registrant's audit committee has considered
whether the provision of non-audit services that were rendered to
the registrant's investment adviser (not including any subadviser
whose role is primarily portfolio management and is subcontracted
with or overseen by another investment adviser), and any entity
controlling, controlled by, or under common control with 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. N/A.
Item 5 - If the registrant is a listed issuer as defined in Rule
10A-3 under the Exchange Act, state whether or not the registrant
has a separately-designated standing audit committee established in
accordance with Section 3(a)(58)(A) of the Exchange Act. If the
registrant has such a committee, however designated, identify each
committee member. If the entire board of directors is acting as the
registrant's audit committee in Section 3(a)(58)(B) of the Exchange
Act, so state.
If applicable, provide the disclosure required by Rule 10A-3(d)
under the Exchange Act regarding an exemption from the listing
standards for audit committees. N/A
(Listed issuers must be in compliance with the new listing rules by
the earlier of their first annual shareholders meeting after January
2004, or October 31, 2004 (annual requirement))
Item 6 - Reserved
Item 7 - For closed-end funds that contain voting securities in
their portfolio, describe the policies and procedures that it uses
to determine how to vote proxies relating to those portfolio
securities. N/A
Item 8--Reserved
Item 9(a) - The registrant's certifying officers have reasonably
designed such disclosure controls and procedures to ensure material
information relating to the registrant is made known to us by others
particularly during the period in which this report is being
prepared. The registrant's certifying officers have determined that
the registrant's disclosure controls and procedures are effective
based on our evaluation of these controls and procedures as of a
date within 90 days prior to the filing date of this report.
Item 9(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,
including any corrective actions with regard to significant
deficiencies and material weaknesses.
Item 10 - Exhibits
10(a) - Attach code of ethics or amendments/waivers, unless code of
ethics or amendments/waivers is on website or offered to
shareholders upon request without charge. N/A.
10(b) - Attach certifications pursuant to Section 302 of the
Sarbanes-Oxley Act. Attached hereto.
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.
CMA Tax-Exempt Fund and Master Tax-Exempt Trust
By: _/s/ Terry K. Glenn_______
Terry K. Glenn,
President of
CMA Tax-Exempt Fund and Master Tax-Exempt Trust
Date: November 21, 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/ Terry K. Glenn________
Terry K. Glenn,
President of
CMA Tax-Exempt Fund and Master Tax-Exempt Trust
Date: November 21, 2003
By: _/s/ Donald C. Burke________
Donald C. Burke,
Chief Financial Officer of
CMA Tax-Exempt Fund and Master Tax-Exempt Trust
Date: November 21, 2003
Attached hereto as a furnished exhibit are the certifications
pursuant to Section 906 of the Sarbanes-Oxley Act.