================================================================================
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 811-02650
RIVERSOURCE GOVERNMENT MONEY MARKET FUND, INC.
--------------------------------------------------
(Exact name of registrant as specified in charter)
50606 Ameriprise Financial Center, Minneapolis, Minnesota 55474
---------------------------------------------------------------
(Address of principal executive offices) (Zip code)
Scott R. Plummer - 5228 Ameriprise Financial Center, Minneapolis, MN 55474
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(Name and address of agent for service)
Registrant's telephone number, including area code: (612) 671-1947
--------------
Date of fiscal year end: 12/31
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Date of reporting period: 12/31
-----
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Annual Report
and Prospectus
(RIVERSOURCE INVESTMENTS LOGO)
RIVERSOURCE
GOVERNMENT MONEY MARKET FUND
(FORMERLY SELIGMAN CASH MANAGEMENT FUND)
ANNUAL REPORT FOR
THE PERIOD ENDED
DECEMBER 31, 2009
(Prospectus also enclosed)
RIVERSOURCE GOVERNMENT MONEY MARKET FUND SEEKS TO
PRESERVE CAPITAL AND TO MAXIMIZE LIQUIDITY AND
CURRENT INCOME.
<Table>
This annual report includes a prospectus that
describes in detail the Fund's objective,
investment strategy, risks, sales charges,
fees and other matters of interest. Please
read the prospectus carefully before you
invest or send money. (SINGLE STRATEGY FUNDS ICON)
</Table>
TABLE OF CONTENTS --------------------------------------------------------------
<Table>
Your Fund at a Glance.............. 2
Manager Commentary................. 4
Fund Expenses Example.............. 8
Portfolio of Investments........... 10
Statement of Assets and
Liabilities...................... 13
Statement of Operations............ 14
Statements of Changes in Net
Assets........................... 15
Financial Highlights............... 17
Notes to Financial Statements...... 20
Report of Independent Registered
Public Accounting Firm........... 33
Federal Income Tax Information..... 35
Board Members and Officers......... 36
Proxy Voting....................... 40
</Table>
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RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT 1
YOUR FUND AT A GLANCE ----------------------------------------------------------
FUND SUMMARY
- --------------------------------------------------------------------------------
> RiverSource Government Money Market Fund (the Fund) gained 0.03% for the 12
months ended Dec. 31, 2009.
> The Fund's annualized simple yield was 0.01% and the annualized compound yield
was also 0.01% for the seven-day period ended Dec. 31, 2009. These yields more
closely reflect the current earnings of the Fund than the total return.
ANNUALIZED TOTAL RETURNS (for period ended Dec. 31, 2009)
- --------------------------------------------------------------------------------
<Table>
<Caption>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
- ---------------------------------------------------------------------
RiverSource Government Money
Market Fund +0.03% +1.73% +2.26% +2.14%
- ---------------------------------------------------------------------
</Table>
The performance information shown represents past performance and is not a
guarantee of future results. The investment return and principal value of your
investment will fluctuate so that your shares, when redeemed, may be worth more
or less than their original cost. Current performance may be lower or higher
than the performance information shown. You may obtain performance information
current to the most recent month-end by contacting your financial intermediary,
visiting riversource.com/funds or calling 1(800) 221-2450.
The Fund is neither insured nor guaranteed by the Federal Deposit Insurance
Corporation (FDIC) or any other government agency. Although the Fund seeks to
preserve the value of your investment at $1 per share, it is possible to lose
money by investing in the Fund. Yields will fluctuate. The performance of other
classes may vary from that shown because of differences in fees and expenses.
The Fund's returns reflect the effect of fee waivers/expense reimbursements, if
any. Without such waivers/reimbursements, the Fund's returns would be lower. See
the Average Annual Total Returns table for performance of other share classes of
the Fund.
- --------------------------------------------------------------------------------
2 RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT
- --------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS
- --------------------------------------------------------------------------------
<Table>
<Caption>
AT DEC. 31, 2009
SINCE
Without sales charge 1 YEAR 3 YEARS 5 YEARS 10 YEARS INCEPTION*
Class A (inception
1/31/77) +0.03% +1.73% +2.26% +2.14% N/A
- --------------------------------------------------------------------------
Class B (inception
4/22/96) +0.01% +1.11% +1.45% +1.42% N/A
- --------------------------------------------------------------------------
Class C (inception
5/18/08) +0.01% N/A N/A N/A +0.02%
- --------------------------------------------------------------------------
Class R2 (inception
4/30/03) +0.01% +1.58% +2.07% N/A +1.58%
- --------------------------------------------------------------------------
Class R5 (inception
11/30/01) +0.03% +1.91% +2.48% N/A +1.80%
- --------------------------------------------------------------------------
With sales charge
Class B (inception
4/22/96) -4.99% +0.12% +1.07% +1.42% N/A
- --------------------------------------------------------------------------
Class C (inception
5/18/08) -0.99% N/A N/A N/A +0.02%
- --------------------------------------------------------------------------
</Table>
Sales charges do not apply to Class A, Class R2 and Class R5 shares. Class B
share performance reflects a contingent deferred sales charge (CDSC) applied as
follows: first year 5%; second year 4%; third and fourth years 3%; fifth year
2%; sixth year 1%; no sales charge thereafter. Class C shares may be subject to
a 1% CDSC if shares are sold within one year after purchase. Class R2 and Class
R5 are available to qualifying institutional investors only.
* For classes with less than 10 years performance.
STYLE MATRIX
- --------------------------------------------------------------------------------
<Table>
<Caption>
DURATION
SHORT INT. LONG
X HIGH
MEDIUM QUALITY
LOW
</Table>
Shading within the style matrix approximates areas in which the Fund is designed
to generally invest.
The style matrix can be a valuable tool for constructing and monitoring your
portfolio. It provides a frame of reference for distinguishing the types of
stocks or bonds owned by a mutual fund, and may serve as a guideline for helping
you build a portfolio.
Investment products, including shares of mutual funds, are not federally or
FDIC-insured, are not deposits or obligations of, or guaranteed by any financial
institution, and involve investment risks including possible loss of principal
and fluctuation in value.
An investment in money market funds is not insured or guaranteed by the Federal
Deposit Insurance Corporation or any other government agency. Although the Fund
seeks to maintain the value of your investment at $1.00 per share, it is
possible to lose money by investing in the Fund.
- --------------------------------------------------------------------------------
RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT 3
MANAGER COMMENTARY -------------------------------------------------------------
Effective September 25, 2009, the Seligman Cash Management Fund changed its name
to the RiverSource Government Money Market Fund. Its principal investment
strategy was revised as follows: The Fund will normally invest at least 80% of
its net assets in high-quality, short-term money market securities that are
issued or guaranteed by the U.S. government, its agencies or instrumentalities.
Dear Shareholder,
RiverSource Government Money Market Fund (the Fund) Class A shares gained 0.03%
for the 12 months ended Dec. 31, 2009. The annualized simple yield was 0.01% and
the annualized compound yield was also 0.01% for the seven-day period ended Dec.
31, 2009. The seven-day current yield more closely reflects the current earnings
of the Fund than the total return. The Fund is intended to serve as a
conservative investment.
SIGNIFICANT PERFORMANCE FACTORS
The annual period ended Dec. 31, 2009 was one characterized by historic shocks
to the global financial system, which resulted in a liquidity freeze. In
response, the Federal Reserve Board (the Fed) took dramatic action in an effort
to restart the flow of credit, increase investor confidence and jump-start an
economic recovery. All of these events had great impact on the money markets,
especially during the first half of the year. The dominant theme in the money
markets during the second half of the year was low yields, as the Fed maintained
the targeted federal funds rate near zero throughout.
Shocks to the global financial system, which had peaked in September 2008,
caused market participants to reduce risk in their investment portfolios in such
dramatic fashion as to ultimately create credit, liquidity and confidence crises
that lasted largely through the first quarter of 2009. In response to these
crises, and in an effort to revive confidence, the Fed, the U.S. Treasury
Department and the Federal Deposit Insurance Corporation (FDIC), along with
several global banking
PORTFOLIO BREAKDOWN(1) (at Dec. 31, 2009)
- ---------------------------------------------------------------------
<Table>
<Caption>
U.S. Government Agencies 100.0%
- ------------------------------------------------
</Table>
(1) Percentages indicated are based upon total investments. The Fund's
composition is subject to change.
- --------------------------------------------------------------------------------
4 RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT
- --------------------------------------------------------------------------------
bodies, created a host of unprecedented programs and a new framework within
which to improve liquidity and restart the flow of credit. For example, in an
effort to restore confidence in retail and institutional money market funds, the
U.S. Treasury Department created a Temporary Guarantee Program for money market
funds. This and other temporary liquidity facilities helped to stabilize demand
for money market funds as the annual period progressed. Indeed, as liquidity and
confidence did return to the money markets during the second half of the year,
the Temporary Guarantee Program expired in September 2009 with little effect on
the asset class. Other facilities were extended until February 2010 in order to
provide continued support to the money markets. The Fed announced the purchase
of over $300 billion of Treasury securities would be completed by October 2009,
months earlier than originally planned.
Interestingly, the comment period for the SEC proposals on various regulatory
changes to the money market industry, including stricter liquidity and credit
standards, shorter maturity profiles, etc., ended in September. These amendments
have been passed, though have not yet been implemented. The changes, along with
enhanced due diligence, are intended to help protect against market disruptions
similar to those seen during the autumn of 2008 from developing in the future.
Many money market funds, including the RiverSource money market funds, have been
voluntarily complying with a good portion of the projected changes before the
actual implementation of such regulatory amendments.
We intend to continue to evaluate credits and make strategic decisions to
balance an enhanced liquidity profile with providing current income.
- --------------------------------------------------------------------------------
RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT 5
MANAGER COMMENTARY (continued) -------------------------------------------------
Most of the Fund's holdings during the annual period were fixed rate securities
with one-to-three month maturities.
CHANGES TO THE FUND'S PORTFOLIO
We strategically adjusted the Fund's average weighted maturity (a measure of its
price sensitivity to changes in interest rates) within a range of approximately
20 to 60 days as market conditions shifted. On an opportunistic basis, we
extended the Fund's maturity profile in an effort to capture some higher yields
offered by longer-term securities. However, the yields on Treasury and agency
securities remained extremely low and quite stable throughout the annual period.
As of Dec. 31, 2009, the average weighted maturity of the Fund was 62 days.
OUR FUTURE STRATEGY
We continue to observe improvement in economic activity across a number of
leading indicators. Such "green shoots" have caused us to re-think whether the
Fed will continue to maintain its near-zero targeted federal funds rate too far
into 2010 or whether it may ultimately have to execute its much-talked-about
exit strategy sooner than many anticipate. We believe the Fed may indeed
implement such an exit strategy in 2010, and we therefore intend to maintain the
Fund's average weighted maturity in the 30 to 60 day range during the months
ahead so that the Fund is well positioned to take advantage of any Fed
tightening in 2010 and the resultant rising rate environment. While we will
certainly look for opportunities to add incremental yield, we will need a little
help from the Fed.
We intend to continue to evaluate credits and make strategic decisions to
balance an enhanced liquidity profile with providing current income. We will, of
course, continue to closely monitor economic data, Fed policy and any shifts in
the money market yield curve, striving to strategically adjust the portfolio
accordingly. We intend to continue to focus on high-quality investments with
minimal credit risk while seeking competitive yields.
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6 RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT
- --------------------------------------------------------------------------------
<Table>
(PHOTO - DAN TRONSTAD)
Dan Tronstad
Portfolio Manager
</Table>
Any specific securities mentioned are for illustrative purposes only and are not
a complete list of securities that have increased or decreased in value. The
views expressed in this statement reflect those of the portfolio manager(s) only
through the end of the period of the report as stated on the cover and do not
necessarily represent the views of RiverSource Investments, LLC (RiverSource) or
any subadviser to the Fund or any other person in the RiverSource or subadviser
organizations. Any such views are subject to change at any time based upon
market or other conditions and RiverSource disclaims any responsibility to
update such views. These views may not be relied on as investment advice and,
because investment decisions for a fund in the RiverSource Family of Funds are
based on numerous factors, may not be relied on as an indication of trading
intent on behalf of any fund in the RiverSource Family of Funds.
- --------------------------------------------------------------------------------
RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT 7
FUND EXPENSES EXAMPLE ----------------------------------------------------------
(UNAUDITED)
As a shareholder of the Fund, you incur two types of costs: (1) transaction
costs, including sales charges (loads); and (2) ongoing costs, which may include
management fees; distribution and service (12b-1) fees; and other Fund fees and
expenses. This example is intended to help you understand your ongoing costs (in
dollars) of investing in the Fund and to compare these costs with the ongoing
costs of investing in other mutual funds.
The example is based on an investment of $1,000 invested at the beginning of the
period and held for the six months ended Dec. 31, 2009.
ACTUAL EXPENSES
The first line of the table provides information about actual account values and
actual expenses. You may use the information in this line, together with the
amount you invested, to estimate the expenses that you paid over the period.
Simply divide your account value by $1,000 (for example, an $8,600 account value
divided by $1,000 = 8.6), then multiply the result by the number in the first
line under the heading titled "Expenses paid during the period" to estimate the
expenses you paid on your account during this period.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The second line of the table provides information about hypothetical account
values and hypothetical expenses based on the Fund's actual expense ratio and an
assumed rate of return of 5% per year before expenses, which is not the Fund's
actual return. The hypothetical account values and expenses may not be used to
estimate the actual ending account balance or expenses you paid for the period.
You may use this information to compare the ongoing costs of investing in the
Fund and other funds. To do so, compare this 5% hypothetical example with the 5%
hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transactional costs, such as sales
charges (loads). Therefore, the second line of the table is useful in comparing
ongoing costs only, and will not help you determine the relative total costs of
owning different funds. In addition, if these transactional costs were included,
your costs would have been higher.
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8 RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT
- --------------------------------------------------------------------------------
<Table>
<Caption>
BEGINNING ENDING EXPENSES
ACCOUNT VALUE ACCOUNT VALUE PAID DURING ANNUALIZED
JULY 1, 2009 DEC. 31, 2009 THE PERIOD(a) EXPENSE RATIO
- ------------------------------------------------------------------------------------------
Class A
- ------------------------------------------------------------------------------------------
Actual(b) $1,000 $1,000.00 $0.60(c) .12%(c)
- ------------------------------------------------------------------------------------------
Hypothetical
(5% return before expenses) $1,000 $1,024.60 $0.61(c) .12%(c)
- ------------------------------------------------------------------------------------------
Class B
- ------------------------------------------------------------------------------------------
Actual(b) $1,000 $1,000.00 $0.66(c) .13%(c)
- ------------------------------------------------------------------------------------------
Hypothetical
(5% return before expenses) $1,000 $1,024.55 $0.66(c) .13%(c)
- ------------------------------------------------------------------------------------------
Class C
- ------------------------------------------------------------------------------------------
Actual(b) $1,000 $1,000.00 $0.66(c) .13%(c)
- ------------------------------------------------------------------------------------------
Hypothetical
(5% return before expenses) $1,000 $1,024.55 $0.66(c) .13%(c)
- ------------------------------------------------------------------------------------------
Class R2
- ------------------------------------------------------------------------------------------
Actual(b) $1,000 $1,000.00 $0.66(c) .13%(c)
- ------------------------------------------------------------------------------------------
Hypothetical
(5% return before expenses) $1,000 $1,024.55 $0.66(c) .13%(c)
- ------------------------------------------------------------------------------------------
Class R5
- ------------------------------------------------------------------------------------------
Actual(b) $1,000 $1,000.10 $0.81(c) .16%(c)
- ------------------------------------------------------------------------------------------
Hypothetical
(5% return before expenses) $1,000 $1,024.40 $0.82(c) .16%(c)
- ------------------------------------------------------------------------------------------
</Table>
(a) Expenses are equal to the annualized expense ratio for each class as
indicated above, multiplied by the average account value over the period,
multiplied by 184/365 (to reflect the one-half year period).
(b) Based on the actual return for the six months ended Dec. 31, 2009: +0.00%*
for Class A, +0.00%* for Class B, +0.00% for Class C, +0.00%* for Class R2
and +0.01% for Class R5.
(c) From time to time, RiverSource Investments, LLC (the Investment Manager) and
its affiliates may limit the expenses of the Fund for the purpose of
increasing the yield. This expense limitation policy may be revised or
terminated at any time without notice. Had the Investment Manager not
limited the expenses of the Fund during the six months ended Dec. 31, 2009,
the annualized expense ratio would have been 0.66% for Class A, 1.32% for
Class B, 1.31% for Class C, 0.98% for Class R2 and 0.48% for Class R5. The
actual expenses paid would have been $3.33 for Class A, $6.65 for Class B,
$6.60 for Class C, $4.94 for Class R2 and $2.42 for Class R5; the
hypothetical expenses paid would have been $3.36 for Class A, $6.72 for
Class B, $6.67 for Class C, $4.99 for Class R2 and $2.45 for Class R5.
* Rounds to zero.
- --------------------------------------------------------------------------------
RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT 9
PORTFOLIO OF INVESTMENTS -------------------------------------------------------
DEC. 31, 2009
(Percentages represent value of investments compared to net assets)
INVESTMENTS IN SECURITIES
<Table>
<Caption>
U.S. GOVERNMENT AGENCIES (100.1%)
AMOUNT
EFFECTIVE PAYABLE AT
ISSUER YIELD MATURITY VALUE(a)
Federal Home Loan Bank
Disc Nts
01-04-10 0.00% $16,500,000(b) $16,499,999
01-05-10 0.08 5,000,000 4,999,944
02-05-10 0.10 5,000,000 4,999,514
02-12-10 0.07 20,000,000 19,998,249
02-24-10 0.06 20,000,000 19,998,200
11-03-10 0.55 5,000,000 5,000,000
Federal Home Loan Mtge Corp
Disc Nts
02-03-10 0.10 5,000,000 4,999,542
03-24-10 0.11 20,000,000 19,994,989
03-29-10 0.09 15,000,000 14,996,738
- -------------------------------------------------------------------------------------
TOTAL U.S. GOVERNMENT AGENCIES
(Cost: $111,487,175) $111,487,175
- -------------------------------------------------------------------------------------
TOTAL INVESTMENTS IN SECURITIES
(Cost: $111,487,175)(c) $111,487,175
=====================================================================================
</Table>
NOTES TO PORTFOLIO OF INVESTMENTS
(a) Securities are valued by using policies described in Note 2 to the
financial statements.
(b) For zero coupons, the interest rate disclosed (.001%) represents the
annualized effective yield on the date of acquisition.
(c) Also represents the cost of securities for federal income tax purposes at
Dec. 31, 2009.
- --------------------------------------------------------------------------------
10 RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT
- --------------------------------------------------------------------------------
FAIR VALUE MEASUREMENTS
Generally accepted accounting principles (GAAP) require disclosure regarding the
inputs and valuation techniques used to measure fair value and any changes in
valuation inputs or techniques. In addition, investments shall be disclosed by
major category.
The Fund categorizes its fair value measurements according to a three-level
hierarchy that maximizes the use of observable inputs and minimizes the use of
unobservable inputs by prioritizing that the most observable input be used when
available. Observable inputs are those that market participants would use in
pricing an investment based on market data obtained from sources independent of
the reporting entity. Unobservable inputs are those that reflect the Fund's
assumptions about the information market participants would use in pricing an
investment. An investment's level within the fair value hierarchy is based on
the lowest level of any input that is deemed significant to the asset or
liability's fair value measurement. The input levels are not necessarily an
indication of the risk or liquidity associated with investments at that level.
For example, certain U.S. government securities are generally high quality and
liquid, however, they are reflected as Level 2 because the inputs used to
determine fair value may not always be quoted prices in an active market.
Fair value inputs are summarized in the three broad levels listed below:
- Level 1 -- Valuations based on quoted prices for investments in active
markets that the Fund has the ability to access at the measurement date.
Valuation adjustments are not applied to Level 1 investments.
- Level 2 -- Valuations based on other significant observable inputs
(including quoted prices for similar securities, interest rates,
prepayment speeds, credit risks, etc.).
- Level 3 -- Valuations based on significant unobservable inputs (including
the Fund's own assumptions and judgment in determining the fair value of
investments).
Inputs that are used in determining fair value of an investment may include
price information, credit data, volatility statistics, and other factors. These
inputs can be either observable or unobservable. The availability of observable
inputs can vary between investments, and is affected by various factors such as
the type of investment, and the volume and level of activity for that investment
or similar investments in the marketplace. The inputs will be considered by the
Fund Administrator, along with any other relevant factors in the calculation of
an investment's fair value. The Fund uses prices and inputs that are current as
of the measurement date, which may include periods of market dislocations.
During these periods, the availability of prices and inputs may be reduced for
many investments. This condition could cause an investment to be reclassified
between the various levels within the hierarchy.
Short-term securities are valued using amortized cost, as permitted under Rule
2a-7 of the Investment Company Act of 1940, as amended. Generally, amortized
cost approximates the current fair value of these securities, but because the
value is not obtained from a quoted price in an active market, such securities
are reflected as Level 2.
Investments falling into the Level 3 category are primarily supported by quoted
prices from brokers and dealers participating in the market for those
investments. However, these may be classified as
- --------------------------------------------------------------------------------
RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT 11
PORTFOLIO OF INVESTMENTS (continued) -------------------------------------------
FAIR VALUE MEASUREMENTS (CONTINUED)
Level 3 investments due to lack of market transparency and corroboration to
support these quoted prices. Additionally, valuation models may be used as the
pricing source for any remaining investments classified as Level 3. These models
rely on one or more significant unobservable inputs and/or significant
assumptions by the Fund Administrator. Inputs used in a valuation model may
include, but are not limited to, financial statement analysis, discount rates
and estimated cash flows, and comparable company data.
The following table is a summary of the inputs used to value the Fund's
investments as of Dec. 31, 2009:
<Table>
<Caption>
FAIR VALUE AT DEC. 31, 2009
----------------------------------------------------------------
LEVEL 1 LEVEL 2
QUOTED PRICES OTHER LEVEL 3
IN ACTIVE SIGNIFICANT SIGNIFICANT
MARKETS FOR OBSERVABLE UNOBSERVABLE
DESCRIPTION IDENTICAL ASSETS INPUTS INPUTS TOTAL
- ---------------------------------------------------------------------------------------------
Short-Term Securities
U.S. Government
Agencies $-- $111,487,175 $-- $111,487,175
- ---------------------------------------------------------------------------------------------
</Table>
HOW TO FIND INFORMATION ABOUT THE FUND'S QUARTERLY PORTFOLIO HOLDINGS
(i) The Fund files its complete schedule of portfolio holdings with the
Securities and Exchange Commission (Commission) for the first and third
quarters of each fiscal year on Form N-Q;
(ii) The Fund's Forms N-Q are available on the Commission's website at
http://www.sec.gov;
(iii)The Fund's Forms N-Q may be reviewed and copied at the Commission's Public
Reference Room in Washington, DC (information on the operations of the
Public Reference Room may be obtained by calling 1(800) SEC-0330); and
(iv) The Fund's complete schedule of portfolio holdings, as filed on Form N-Q,
can be obtained without charge, upon request, by calling the RiverSource
Family of Funds at 1(800) 221-2450.
- --------------------------------------------------------------------------------
12 RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT
STATEMENT OF ASSETS AND LIABILITIES --------------------------------------------
DEC. 31, 2009
<Table>
<Caption>
ASSETS
Investments in securities, at value (identified cost
$111,487,175) $111,487,175
Cash 137,914
Capital shares receivable 439,838
Dividends and accrued interest receivable 4,482
Other assets 3,719
- -------------------------------------------------------------------------------
Total assets 112,073,128
- -------------------------------------------------------------------------------
LIABILITIES
Dividends payable to shareholders 31
Capital shares payable 478,738
Accrued investment management services fees 1,003
Accrued distribution fees 17,570
Accrued transfer agency fees 104,546
Accrued administrative services fees 182
Accrued plan administration services fees 1,343
Other accrued expenses 44,344
- -------------------------------------------------------------------------------
Total liabilities 647,757
- -------------------------------------------------------------------------------
Net assets applicable to outstanding capital stock $111,425,371
- -------------------------------------------------------------------------------
REPRESENTED BY
Capital stock -- $.01 par value $ 1,114,150
Additional paid-in capital 110,313,742
Excess of distributions over net investment income (2,521)
- -------------------------------------------------------------------------------
Total -- representing net assets applicable to outstanding
capital stock $111,425,371
- -------------------------------------------------------------------------------
</Table>
<Table>
<Caption>
NET ASSET VALUE PER SHARE
NET ASSETS SHARES OUTSTANDING NET ASSET VALUE PER SHARE
Class A $89,878,036 89,888,902 $1.00
Class B $ 4,745,466 4,744,006 $1.00
Class C $13,538,936 13,518,927 $1.00
Class R2 $ 3,134,050 3,134,336 $1.00
Class R5 $ 128,883 128,873 $1.00
- ----------------------------------------------------------------------------------------
</Table>
The accompanying Notes to Financial Statements are an integral part of this
statement.
- --------------------------------------------------------------------------------
RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT 13
STATEMENT OF OPERATIONS --------------------------------------------------------
YEAR ENDED DEC. 31, 2009
<Table>
<Caption>
INVESTMENT INCOME
Income:
Interest $ 416,022
Income from securities lending -- net 1,016
- ------------------------------------------------------------------------------
Total income 417,038
- ------------------------------------------------------------------------------
Expenses:
Investment management services fees 518,174
Distribution fees
Class A 54,819
Class B 51,551
Class C 133,682
Class C2* 4,804
Class R2 6,985
Transfer agency fees
Class A 521,126
Class B 29,059
Class C 73,807
Class C2* 3,013
Class R2 9,063
Class R5 28,369
Administrative services fees 41,094
Plan administration services fees -- Class R2 4,409
Compensation of board members 4,224
Custodian fees 38,158
Printing and postage 47,565
Registration fees 105,767
Professional fees 30,721
Temporary Guarantee Program Participation fees 65,451
Other 14,149
- ------------------------------------------------------------------------------
Total expenses 1,785,990
Expenses waived/reimbursed by the Investment Manager and its
affiliates (1,411,065)
- ------------------------------------------------------------------------------
Total net expenses 374,925
- ------------------------------------------------------------------------------
Investment income (loss) -- net 42,113
- ------------------------------------------------------------------------------
</Table>
* Effective March 27, 2009, Class C2 shares converted to Class A shares
The accompanying Notes to Financial Statements are an integral part of this
statement.
- --------------------------------------------------------------------------------
14 RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT
STATEMENTS OF CHANGES IN NET ASSETS --------------------------------------------
<Table>
<Caption>
YEAR ENDED DEC. 31, 2009 2008
OPERATIONS AND DISTRIBUTIONS
Net increase (decrease) in net assets resulting from
operations $ 42,113 $ 2,132,997
- ------------------------------------------------------------------------------------------
Distributions to shareholders from:
Net investment income
Class A (37,211) (1,810,626)
Class B (579) (25,501)
Class C (1,493) (45,329)
Class C2* (65) (30,337)
Class R2 (296) (7,603)
Class R5 (4,990) (213,601)
Net realized gain
Class A -- (25,685)
Class B -- (1,011)
Class C -- (2,135)
Class C2* -- (849)
Class R2 -- (114)
Class R5 -- (2,431)
- ------------------------------------------------------------------------------------------
Total distributions (44,634) (2,165,222)
- ------------------------------------------------------------------------------------------
</Table>
- --------------------------------------------------------------------------------
RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT 15
STATEMENTS OF CHANGES IN NET ASSETS (continued) --------------------------------
<Table>
<Caption>
YEAR ENDED DEC. 31, 2009 2008
CAPITAL SHARE TRANSACTIONS AT A CONSTANT $1 NET ASSET VALUE
Proceeds from sales
Class A shares $ 111,251,313 $ 339,626,601
Class B shares 2,700,244 6,669,730
Class C shares 9,024,006 17,207,377
Class C2 shares* -- 6,284,369
Class R2 shares 3,308,763 6,695,371
Class R5 shares 12,630,747 21,128,370
Reinvestment of distributions at net asset value
Class A shares 39,430 1,846,932
Class B shares 470 27,994
Class C shares 1,298 51,428
Class C2 shares* 56 30,696
Class R2 shares 284 8,470
Class R5 shares 5,691 224,573
Conversions from Class B to Class A
Class A shares 789,457 1,882,113
Class B shares (789,457) (1,882,113)
Conversions from Class C2 to Class A*
Class A shares 2,491,332 N/A
Class C2 shares (2,491,332) N/A
Payments for redemptions
Class A shares (148,817,648) (352,129,587)
Class B shares (4,105,737) (5,331,721)
Class C shares (12,056,427) (14,328,869)
Class C2 shares* (359,865) (7,474,257)
Class R2 shares (1,820,362) (5,611,900)
Class R5 shares (32,945,721) (15,423,295)
- ------------------------------------------------------------------------------------------
Increase (decrease) in net assets from capital share
transactions (61,143,458) (497,718)
- ------------------------------------------------------------------------------------------
Total increase (decrease) in net assets (61,145,979) (529,943)
Net assets at beginning of year 172,571,350 173,101,293
- ------------------------------------------------------------------------------------------
Net assets at end of year $ 111,425,371 $ 172,571,350
- ------------------------------------------------------------------------------------------
Excess of distributions over net investment income $ (2,521) $ --
- ------------------------------------------------------------------------------------------
</Table>
* Effective March 27, 2009, Class C2 shares converted to Class A shares.
Certain line items from the prior year have been renamed to conform to the
current year presentation.
The accompanying Notes to Financial Statements are an integral part of this
statement.
- --------------------------------------------------------------------------------
16 RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT
FINANCIAL HIGHLIGHTS -----------------------------------------------------------
The following tables are intended to help you understand the Fund's financial
performance. Certain information reflects financial results for a single share
of a class held for the periods shown. Per share net investment income (loss)
amounts are calculated based on average shares outstanding during the period.
Total returns assume reinvestment of all dividends and distributions. Total
returns do not reflect payment of sales charges, if any, and are not annualized
for periods of less than one year.
<Table>
<Caption>
YEAR ENDED DEC. 31,
CLASS A -------------------------------------------------
PER SHARE DATA 2009 2008 2007 2006 2005
Net asset value, beginning of period $1.00 $1.00 $1.00 $1.00 $1.00
- ----------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) .00(a) .01 .04 .04 .02
- ----------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends from net investment income (.00)(a) (.01)(b) (.04) (.04) (.02)
- ----------------------------------------------------------------------------------------------------
Net asset value, end of period $1.00 $1.00 $1.00 $1.00 $1.00
- ----------------------------------------------------------------------------------------------------
TOTAL RETURN .03% 1.12% 4.09% 3.95% 2.20%
- ----------------------------------------------------------------------------------------------------
RATIOS TO AVERAGE NET ASSETS
Gross expenses prior to expense
waiver/reimbursement 1.14% .91% .86% .90% .86%
- ----------------------------------------------------------------------------------------------------
Net expenses after expense
waiver/reimbursement(c) .25% .79% .86% .90% .86%
- ----------------------------------------------------------------------------------------------------
Net investment income (loss) .03% 1.07% 4.03% 3.86% 2.15%
- ----------------------------------------------------------------------------------------------------
SUPPLEMENTAL DATA
Net assets, end of period (in millions) $90 $124 $133 $124 $133
- ----------------------------------------------------------------------------------------------------
</Table>
<Table>
<Caption>
YEAR ENDED DEC. 31,
CLASS B ----------------------------------------------------
PER SHARE DATA 2009 2008 2007 2006 2005
Net asset value, beginning of period $1.00 $1.00 $1.00 $1.00 $1.00
- -------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) .00(a) .00(a) .03 .03 .01
- -------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends from net investment income (.00)(a) (.00)(a),(b) (.03) (.03) (.01)
- -------------------------------------------------------------------------------------------------------
Net asset value, end of period $1.00 $1.00 $1.00 $1.00 $1.00
- -------------------------------------------------------------------------------------------------------
TOTAL RETURN .01% .35% 3.00% 2.85% 1.11%
- -------------------------------------------------------------------------------------------------------
RATIOS TO AVERAGE NET ASSETS
Gross expenses prior to expense
waiver/reimbursement 1.99% 1.91% 1.86% 1.89% 1.86%
- -------------------------------------------------------------------------------------------------------
Net expenses after expense
waiver/reimbursement(c) .29% 1.53% 1.86% 1.89% 1.85%
- -------------------------------------------------------------------------------------------------------
Net investment income (loss) .00%(a) .33% 3.03% 2.86% 1.16%
- -------------------------------------------------------------------------------------------------------
SUPPLEMENTAL DATA
Net assets, end of period (in millions) $5 $7 $7 $9 $13
- -------------------------------------------------------------------------------------------------------
</Table>
See accompanying Notes to Financial Highlights.
- --------------------------------------------------------------------------------
RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT 17
FINANCIAL HIGHLIGHTS (continued) -----------------------------------------------
<Table>
<Caption>
YEAR ENDED DEC. 31,
CLASS C ----------------------------------------------------
PER SHARE DATA 2009 2008 2007 2006 2005
Net asset value, beginning of period $1.00 $1.00 $1.00 $1.00 $1.00
- -------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) .00(a) .00(a) .03 .03 .01
- -------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends from net investment income (.00)(a) (.00)(a),(b) (.03) (.03) (.01)
- -------------------------------------------------------------------------------------------------------
Net asset value, end of period $1.00 $1.00 $1.00 $1.00 $1.00
- -------------------------------------------------------------------------------------------------------
TOTAL RETURN .01% .35% 3.00% 2.85% 1.11%
- -------------------------------------------------------------------------------------------------------
RATIOS TO AVERAGE NET ASSETS
Gross expenses prior to expense
waiver/reimbursement 1.96% 1.91% 1.86% 1.89% 1.86%
- -------------------------------------------------------------------------------------------------------
Net expenses after expense
waiver/reimbursement(c) .28% 1.53% 1.86% 1.89% 1.85%
- -------------------------------------------------------------------------------------------------------
Net investment income (loss) .00%(a) .33% 3.03% 2.86% 1.16%
- -------------------------------------------------------------------------------------------------------
SUPPLEMENTAL DATA
Net assets, end of period (in millions) $14 $17 $14 $13 $13
- -------------------------------------------------------------------------------------------------------
</Table>
<Table>
<Caption>
YEAR ENDED DEC. 31,
CLASS R2* -------------------------------------------------
PER SHARE DATA 2009 2008 2007 2006 2005
Net asset value, beginning of period $1.00 $1.00 $1.00 $1.00 $1.00
- ----------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) .00(a) .01 .04 .04 .02
- ----------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends from net investment income (.00)(a) (.01)(b) (.04) (.04) (.02)
- ----------------------------------------------------------------------------------------------------
Net asset value, end of period $1.00 $1.00 $1.00 $1.00 $1.00
- ----------------------------------------------------------------------------------------------------
TOTAL RETURN .01%(e) .93% 3.83% 3.69% 1.94%
- ----------------------------------------------------------------------------------------------------
RATIOS TO AVERAGE NET ASSETS
Gross expenses prior to expense
waiver/reimbursement 1.32% 1.16% 1.11% 1.15% 1.11%
- ----------------------------------------------------------------------------------------------------
Net expenses after expense
waiver/reimbursement(c) .22% 1.01% 1.11% 1.15% 1.11%
- ----------------------------------------------------------------------------------------------------
Net investment income (loss) .00%(a) .84% 3.78% 3.61% 1.90%
- ----------------------------------------------------------------------------------------------------
SUPPLEMENTAL DATA
Net assets, end of period (in millions) $3 $2 $1 $-- $--
- ----------------------------------------------------------------------------------------------------
</Table>
See accompanying Notes to Financial Highlights.
- --------------------------------------------------------------------------------
18 RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT
- --------------------------------------------------------------------------------
<Table>
<Caption>
YEAR ENDED DEC. 31,
CLASS R5* -------------------------------------------------
PER SHARE DATA 2009 2008 2007 2006 2005
Net asset value, beginning of period $1.00 $1.00 $1.00 $1.00 $1.00
- ----------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss)(b) .00(a) .01 .04 .04 .02
- ----------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends from net investment income (.00)(a) (.01)(b) (.04) (.04) (.02)
- ----------------------------------------------------------------------------------------------------
Net asset value, end of period $1.00 $1.00 $1.00 $1.00 $1.00
- ----------------------------------------------------------------------------------------------------
TOTAL RETURN .03% 1.38% 4.36% 4.23% 2.48%
- ----------------------------------------------------------------------------------------------------
RATIOS TO AVERAGE NET ASSETS
Gross expenses prior to expense
waiver/reimbursement .94% .63% .59% .60% .58%
- ----------------------------------------------------------------------------------------------------
Net expenses after expense
waiver/reimbursement(c) .36% .53% .59% .60% .58%
- ----------------------------------------------------------------------------------------------------
Net investment income (loss) .06% 1.33% 4.30% 4.16% 2.43%
- ----------------------------------------------------------------------------------------------------
SUPPLEMENTAL DATA
Net assets, end of period (in millions) $-- $20 $15 $12 $13
- ----------------------------------------------------------------------------------------------------
</Table>
NOTES TO FINANCIAL HIGHLIGHTS
* Effective June 13, 2009, Class R and Class I shares were redesignated as
Class R2 and Class R5 shares, respectively.
(a) Rounds to zero.
(b) In addition, the Fund paid a short-term capital gain distribution of
$0.000146 on July 25, 2008.
(c) The Investment Manager and its affiliates have agreed to waive/reimburse
certain fees and expenses (excluding fees and expenses of acquired funds).
The accompanying Notes to Financial Statements are an integral part of this
statements.
- --------------------------------------------------------------------------------
RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT 19
NOTES TO FINANCIAL STATEMENTS --------------------------------------------------
1. ORGANIZATION
RiverSource Government Money Market Fund (the Fund) (formerly Seligman Cash
Management Fund) is registered under the Investment Company Act of 1940, as
amended (the 1940 Act) as a diversified, open-end management investment company.
The Fund has 1.4 billion authorized shares of capital stock. The Fund will
normally invest at least 80% of its net assets in high-quality, short-term money
market securities that are issued or guaranteed by the U.S. government, its
agencies or instrumentalities.
The Fund offers Class A, Class B, Class C, Class R2 and Class R5 shares.
- - Class A shares have no sales charge. Prior to June 12, 2009, Class A Shares
may have been subject to a contingent deferred sales charge (CDSC).
- - Class B shares may be subject to a CDSC and automatically convert to Class A
shares one month after the completion of the eighth year of ownership if
originally purchased in a RiverSource fund on or after May 21, 2005 or
originally purchased in a Seligman fund on or after June 13, 2009. Class B
shares originally purchased in a RiverSource fund prior to May 21, 2005 will
convert to Class A shares in the ninth calendar year of ownership. Class B
shares originally purchased in a Seligman fund prior to June 13, 2009 will
convert to Class A shares in the month prior to the ninth year of ownership.
- - Class C shares may be subject to a CDSC.
- - Effective June 13, 2009, Class R and Class I shares were redesignated as
Class R2 and Class R5 shares, respectively. Class R2 and Class R5 shares are
offered without a front-end sales charge or CDSC to qualifying institutional
investors. Prior to June 13, 2009, Class R shares (redesignated to Class R2
shares) charged a 1% CDSC on shares sold within one year of initial purchase.
Effective March 27, 2009, Class C2 shares converted to Class A shares and as of
this date the Fund no longer offers Class C2 shares.
All classes of shares have identical voting, dividend and liquidation rights.
Class specific expenses (e.g., distribution and service fees, transfer agency
fees, plan administration services fees) differ among classes. Income, expenses
(other than class specific expenses) and realized and unrealized gains or losses
on investments are allocated to each class of shares based upon its relative net
assets.
- --------------------------------------------------------------------------------
20 RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT
- --------------------------------------------------------------------------------
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
ADOPTION OF NEW ACCOUNTING STANDARD
In June 2009, the Financial Accounting Standards Board (FASB) established the
FASB Accounting Standards Codification(TM )(Codification) as the single source
of authoritative accounting principles recognized by the FASB in the preparation
of financial statements in conformity with U.S. generally accepted accounting
principles (GAAP). The Codification supersedes existing non-grandfathered, non-
SEC accounting and reporting standards. The Codification did not change GAAP
but, rather, organized it into a hierarchy where all guidance within the
Codification carries an equal level of authority. The Codification became
effective for financial statements issued for interim and annual periods ending
after Sept. 15, 2009. The Codification did not have an effect on the Fund's
financial statements.
USE OF ESTIMATES
Preparing financial statements that conform to U.S. generally accepted
accounting principles requires management to make estimates (e.g., on assets,
liabilities and contingent assets and liabilities) that could differ from actual
results.
VALUATION OF SECURITIES
Pursuant to Rule 2a-7 of the 1940 Act, all securities are valued daily at
amortized cost, which approximates market value.
GUARANTEES AND INDEMNIFICATIONS
Under the Fund's organizational documents, its officers and directors are
indemnified against certain liabilities arising out of the performance of their
duties to the Fund. In addition, certain of the Fund's contracts with its
service providers contain general indemnification clauses. The Fund's maximum
exposure under these arrangements is unknown since the amount of any future
claims that may be made against the Fund cannot be determined and the Fund has
no historical basis for predicting the likelihood of any such claims.
FEDERAL TAXES
The Fund's policy is to comply with Subchapter M of the Internal Revenue Code
that applies to regulated investment companies and to distribute substantially
all of its taxable income (which includes net short-term capital gains) to
shareholders. No provision for income or excise taxes is thus required.
Management of the Fund has concluded that there are no significant uncertain tax
positions that would require recognition in the financial statements. Generally,
the tax authorities can examine all the tax returns filed for the last three
years.
- --------------------------------------------------------------------------------
RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT 21
NOTES TO FINANCIAL STATEMENTS (continued) --------------------------------------
RECENT ACCOUNTING PRONOUNCEMENT
On Jan. 21, 2010, the FASB issued an Accounting Standards Update (the
amendment), Fair Value Measurements and Disclosures (Topic 820): Improving
Disclosures about Fair Value Measurements, which provides guidance on how
investment assets and liabilities are to be valued and disclosed. Specifically,
the amendment requires reporting entities to disclose the input and valuation
techniques used to measure fair value for both recurring and nonrecurring fair
value measurements for Level 2 or Level 3 positions. The amendment also requires
that transfers between all levels (including Level 1 and Level 2) be disclosed
on a gross basis (i.e., transfers out must be disclosed separately from
transfers in), and the reason(s) for the transfer. Additionally purchases,
sales, issuances and settlements must be disclosed on a gross basis in the Level
3 rollforward. The effective date of the amendment is for interim and annual
periods beginning after Dec. 15, 2009, however, the requirement to provide the
Level 3 activity for purchases, sales, issuances and settlements on a gross
basis will be effective for interim and annual periods beginning after Dec. 15,
2010. At this time the Fund is evaluating the implications of the amendment and
the impact to the financial statements.
DIVIDENDS TO SHAREHOLDERS
Dividends from net investment income, declared daily and payable monthly, are
reinvested in additional shares of the Fund at net asset value or payable in
cash.
OTHER
Security transactions are accounted for on the date securities are purchased or
sold. Interest income, including amortization of premium and discount, is
recognized daily.
3. EXPENSES AND SALES CHARGES
INVESTMENT MANAGEMENT SERVICES FEES
Under an Administrative Services Agreement, RiverSource Investments, LLC (the
Investment Manager) determines which securities will be purchased, held or sold.
Effective June 15, 2009, the management fee is equal to a percentage of the
Fund's average daily net assets that declines from 0.33% to 0.15% as the Fund's
net assets increase. Prior to June 15, 2009, the Investment Manager received an
annual fee equal to 0.40% of the Fund's average daily net assets. The management
fee for the year ended Dec. 31, 2009 was 0.37% of the Fund's average daily net
assets. The reduction in the investment management services fee on June 15, 2009
is related to the elimination of the administrative portion of the management
fee that is now being charged separately to the Fund through the Administrative
Services Agreement with Ameriprise Financial, Inc. (Ameriprise
- --------------------------------------------------------------------------------
22 RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT
- --------------------------------------------------------------------------------
Financial), parent company of the Investment Manager. See Administrative
services fees below for more information.
ADMINISTRATIVE SERVICES FEES
Under an Administrative Services Agreement, effective June 15, 2009, the Fund
pays Ameriprise Financial an annual fee for administration and accounting
services equal to a percentage of the Fund's average daily net assets that
declines from 0.06% to 0.03% as the Fund's net assets increase. For the period
from June 15, 2009 through Dec. 31, 2009, the fee was 0.03% of the Fund's
average daily net assets. Prior to June 15, 2009, Ameriprise Financial
administered certain aspects of the Fund's business and other affairs for no
additional fee. The fees payable under the Administrative Services Agreement
beginning on June 15, 2009 are offset by corresponding decreases in the
investment management fees charged to the Fund and the elimination of separate
fees that were previously payable to State Street Bank and Trust Company, in its
capacity as the Fund's prior administrative agent.
OTHER FEES
Other expenses are for, among other things, certain expenses of the Fund or the
Fund's Board of Directors (the Board) including: Fund boardroom and office
expense, employee compensation, employee health and retirement benefits, and
certain other expenses. Payment of these Fund and Board expenses is facilitated
by a company providing limited administrative services to the Fund and the
Board. For the year ended Dec. 31, 2009, other expenses paid to this company
were $1,259.
COMPENSATION OF BOARD MEMBERS
Under a Deferred Compensation Plan (the Plan), the board members who are not
"interested persons" of the fund under the 1940 Act may defer receipt of their
compensation. Deferred amounts are treated as though equivalent dollar amounts
had been invested in shares of the Fund or other funds in the RiverSource Family
of Funds. The Fund's liability for these amounts is adjusted for market value
changes and remains in the funds until distributed in accordance with the Plan.
TRANSFER AGENCY FEES
Effective June 15, 2009, under a Transfer Agency Agreement (the Agreement),
RiverSource Services Corporation (the Transfer Agent) maintains Fund shareholder
accounts and records and provides Fund shareholder services. Under the
Agreement, the Fund pays the Transfer Agent an annual account-based fee at a
rate equal to $22.00 for Class A, $23.00 for Class B and $22.50 for Class C for
this service. The Transfer Agent also charges an annual fee of $3 per account
serviced directly by the Fund or its designated agent for Class A, Class B and
Class C shares. The Fund also pays the Transfer Agent an annual asset-based fee
- --------------------------------------------------------------------------------
RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT 23
NOTES TO FINANCIAL STATEMENTS (continued) --------------------------------------
at a rate of 0.05% of the Fund's average daily net assets attributable to Class
R2 and Class R5. The Transfer Agent charges an annual fee of $5 per inactive
account, charged on a pro rata basis for the 12 month period from the date the
account becomes inactive. These fees are included in the transfer agency fees in
the Statement of Operations.
Prior to June 15, 2009, Seligman Data Corp. (SDC) owned by six associated
investment companies, including the fund, provided shareholder servicing and
transfer agency services to the Fund, as well as certain other Seligman funds.
The Fund's ownership interest in SDC at Dec. 31, 2009 is included in other
assets in the Statement of Assets and Liabilities at cost of $3,719. In January
2009, the Board approved the Fund's termination of the shareholder servicing and
transfer agency relationship with SDC and the engagement of RiverSource Service
Corporation to provide shareholder servicing and transfer agency services. As a
result of the Board's termination of the shareholder servicing and transfer
agency relationship with SDC (which was SDC's sole business), SDC has exited the
transfer agent business, effective June 15, 2009.
For the period from Jan. 1, 2009 to June 15, 2009, SDC charged the Fund $309,258
for shareholder account services in accordance with a methodology approved by
the Fund's Board. Class R5 shares (formerly designated Class I shares prior to
June 13, 2009) received more limited shareholder services than the Fund's other
classes of shares. SDC did not allocate to Class R5 the costs of any of its
departments that did not provide services to the Class R5 shareholders. Costs of
SDC directly attributable to other classes of the Fund were charged to those
classes in proportion to their relative net asset values. Costs directly
attributable to Class R5 shares were charged to Class R5. The remaining charges
were allocated to all classes by SDC pursuant to a formula based on their net
assets, shareholder transaction volumes and number of shareholder accounts.
In connection with the termination of the Fund's relationship with SDC, the Fund
incurred certain non-recurring charges, including charges relating to the
remaining periods of SDC's leases (the Non-Recurring Charges). These Non-
Recurring Charges were incurred over a period from Jan. 28, 2009 to June 12,
2009, and amounted to $213,087, or 0.15% of the Fund's average daily net assets
for the year ended Dec. 31, 2009. These Non-Recurring Charges are included in
transfer agency fees in the Statement of Operations. The Non-Recurring Charges
are included in the Fund's total expenses and are, therefore, subject to any
expense waivers/reimbursements described below.
The Fund and certain other associated investment companies (together, the
Guarantors) have severally but not jointly guaranteed the performance and
observance of all the terms and conditions of a lease entered into by SDC,
- --------------------------------------------------------------------------------
24 RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT
- --------------------------------------------------------------------------------
including the payment of rent by SDC (the Guaranty). The lease and the Guaranty
expire in January 2019. At Dec. 31, 2009, the Fund's total potential future
obligation over the life of the Guaranty is $202,642. The liability remaining at
Dec. 31, 2009 for Non-Recurring Charges amounted to $103,953 and is included
within accrued transfer agency fees in the Statement of Assets and Liabilities.
PLAN ADMINISTRATION SERVICES FEES
Under a Plan Administration Services Agreement, effective June 15, 2009, the
Fund pays the Transfer Agent an annual fee at a rate of 0.25% of the Fund's
average daily net assets attributable to Class R2 shares for the provision of
various administrative, recordkeeping, communication and educational services.
DISTRIBUTION FEES
The Fund has an agreement with RiverSource Fund Distributors, Inc. (the
Distributor) for distribution and shareholder services. Under a Plan and
Agreement of Distribution pursuant to Rule 12b-1, the Fund pays a fee at an
annual rate of up to 0.25% of the Fund's average daily net assets attributable
to Class A shares, a fee at an annual rate of up to 0.50% of the Fund's average
daily net assets attributable to Class R2 shares and a fee at an annual rate of
up to 1.00% of the Fund's average daily net assets attributable to Class B and
Class C shares. For class B and class C shares, of the 1.00% fee, up to 0.75%
was reimbursement for distribution expenses. For class R shares (redesignated to
class R2 shares on June 13, 2009) of the 0.50% fee, up to 0.25% of the fee was
reimbursed for distribution expenses.
The amount of distribution expenses incurred by the Distributor and not yet
reimbursed (unreimbursed expense) was approximately $115,000 and $2,812,000 and
for Class B and Class C shares, respectively. These amounts are based on the
most recent information available as of Oct. 31, 2009, and may be recovered from
future payments under the distribution plan or CDSC. To the extent the
unreimbursed expense has been fully recovered, the distribution fee is reduced.
SALES CHARGES
Sales charges, including front-end and CDSCs, received by the Distributor for
distributing Fund shares were $136 for Class A, $19,783 for Class B and $2,926
for Class C for the year ended Dec. 31, 2009. Effective June 13, 2009, the 1%
CDSC was eliminated for Class R2 shares.
- --------------------------------------------------------------------------------
RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT 25
NOTES TO FINANCIAL STATEMENTS (continued) --------------------------------------
EXPENSES WAIVED/REIMBURSED BY THE INVESTMENT MANAGER AND ITS AFFILIATES
For the year ended Dec. 31, 2009, the Investment Manager and its affiliates
waived/reimbursed certain fees and expenses such that net expenses were as
follows:
<Table>
Class A.............................................. 0.25%
Class B.............................................. 0.29
Class C.............................................. 0.28
Class R2............................................. 0.22
Class R5............................................. 0.36
</Table>
The waived/reimbursed fees and expenses for the transfer agency fees and other
fees at the class level were as follows:
<Table>
Class A........................................... $576,852
Class B........................................... 60,228
Class C........................................... 151,119
Class R2.......................................... 12,835
Class R5.......................................... 45,056
</Table>
The management fees, administrative services fees and other fees
waived/reimbursed at the Fund level were $564,975.
Effective May 1, 2009, the Investment Manager and its affiliates have
contractually agreed to waive certain fees and expenses until Feb. 28, 2011,
unless sooner terminated at the sole discretion of the Board, such that net
expenses will not exceed the following percentage of the class' average daily
net assets:
<Table>
Class A.............................................. 0.66%
Class B.............................................. 1.32
Class C.............................................. 1.31
Class R2............................................. 0.98
Class R5............................................. 0.48
</Table>
TEMPORARY MONEY MARKET FUND GUARANTY PROGRAM
On Oct. 6, 2008, the Fund applied to participate in the initial term of the U.S.
Department of Treasury's Temporary Guarantee Program for Money Market Funds (the
Program), through Dec. 18, 2008 (the Initial Term), after obtaining the approval
of the Board, including a majority of the independent directors. On Dec. 2,
2008, the Board approved the Fund's participation in an extension of the Program
through April 30, 2009 (the First Extended Term). On April 8, 2009, the Board
approved the Fund's participation in an extension of the Program through Sept.
18, 2009 (the Second Extended Term). The Fund filed the extension notice with
the U.S. Department of Treasury on April 13, 2009 to participate in the Second
Extended Term of the Program.
- --------------------------------------------------------------------------------
26 RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT
- --------------------------------------------------------------------------------
During the year ended Dec. 31, 2009, the Fund paid an upfront fee to the U.S.
Department of Treasury to participate in the Program. The fee to participate in
the Second Extended Term of the Program through Sept. 18, 2009, required a
payment in the amount of 0.015% of the Fund's net asset value as of Sept. 19,
2008. The fees were amortized over the period of the participation in the
Program and are shown on the Fund's Statement of Operations. The cost to
participate was borne by the Fund without regard to any contractual expense
limitation currently in effect, if any. However, to the extent the investment
manager voluntarily limited the expenses of the Fund for the purposes of
supporting its yield, the cost to participate in the Program may have been
absorbed by the Investment Manager. The Program expired on the close of business
on Sept. 18, 2009.
4. LENDING OF PORTFOLIO SECURITIES
Effective May 15, 2009, the Fund has entered into a Master Securities Lending
Agreement (the Agreement) with JPMorgan Chase Bank, National Association
(JPMorgan). The Agreement authorizes JPMorgan as lending agent to lend
securities to authorized borrowers in order to generate additional income on
behalf of the Fund. Pursuant to the Agreement, the securities loaned are secured
by cash or U.S. government securities equal to at least 100% of the market value
of the loaned securities. Any additional collateral required to maintain those
levels due to market fluctuations of the loaned securities is delivered the
following business day. Cash collateral received is invested by the lending
agent on behalf of the Fund into authorized investments pursuant to the
Agreement. The investments made with the cash collateral are listed in the
Portfolio of Investments. The values of such investments and any uninvested cash
collateral balance are disclosed in the Statement of Assets and Liabilities
along with the related obligation to return the collateral upon the return of
the securities loaned. At Dec. 31, 2009, the Fund had no securities on loan.
Risks of delay in recovery of securities or even loss of rights in the
securities may occur should the borrower of the securities fail financially.
Risks may also arise to the extent that the value of the securities loaned
increases above the value of the collateral received. JPMorgan will indemnify
the Fund from losses resulting from a borrower's failure to return a loaned
security when due. Such indemnification does not extend to losses associated
with declines in the value of cash collateral investments. Loans are subject to
termination by the Funds or the borrower at any time, and are, therefore, not
considered to be illiquid investments.
- --------------------------------------------------------------------------------
RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT 27
NOTES TO FINANCIAL STATEMENTS (continued) --------------------------------------
Pursuant to the Agreement, the Fund receives income for lending its securities
either in the form of fees or by earning interest on invested cash collateral,
net of negotiated rebates paid to borrowers and fees paid to the lending agent
for services provided and any other securities lending expenses. Net income of
$1,016 earned from securities lending for the year ended Dec. 31, 2009 is
included in the Statement of Operations. The Fund also continues to earn
interest and dividends on the securities loaned.
5. BANK BORROWINGS
The Fund has entered into a revolving credit facility with a syndicate of banks
led by JPMorgan Chase Bank, N.A. (the Administrative Agent), whereby the Fund
may borrow for the temporary funding of shareholder redemptions or for other
temporary or emergency purposes. The credit facility became effective on Oct.
15, 2009, replacing the prior credit facilities. The credit facility agreement,
which is a collective agreement between the Fund and certain other funds in the
RiverSource Family of Funds, severally and not jointly, permits collective
borrowings up to $300 million. The borrowers shall have the right, upon written
notice to the Administrative Agent to request an increase of up to $200 million
in the aggregate amount of the credit facility from new or existing lenders,
provided that the aggregate amount of the credit facility shall at no time
exceed $500 million. Participation in such increase by any existing lender shall
be at such lender's sole discretion. Interest is charged to the Fund based on
its borrowings at a rate equal to the sum of the federal funds rate plus (A)
1.25% per annum plus (B) if one-month LIBOR exceeds the federal funds rate, the
amount of such excess. Each borrowing under the credit facility matures no later
than 60 days after the date of borrowing. The Fund also pays a commitment fee
equal to its pro rata share of the amount of the credit facility at a rate of
0.10% per annum, in addition to an upfront fee equal to its pro rata share of
0.04% of the amount of the credit facility.
For the period from June 17, 2009 through to Oct. 15, 2009, the credit facility
agreement, which was a collective agreement between the Fund and certain other
funds in the RiverSource Family of Funds, severally and not jointly, permitted
collective borrowings up to $475 million. Interest was charged to the Fund based
on its borrowings at a rate equal to the federal funds rate plus 0.75%. The Fund
also paid a commitment fee equal to its pro rata share of the amount of the
credit facility at a rate of 0.06% per annum.
Prior to June 17, 2009, the Fund participated in a joint $200 million committed
line of credit that was shared by substantially all funds in the Seligman Group
of Investment Companies. The Board had limited the Fund's borrowings to 10% of
- --------------------------------------------------------------------------------
28 RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT
- --------------------------------------------------------------------------------
its net assets. Borrowings pursuant to the credit facility were subject to
interest at a rate equal to the overnight federal funds rate plus 0.50%. The
Fund incurred a commitment fee of 0.12% per annum on its share of the unused
portion of the credit facility. The credit facility may have been drawn upon
only for temporary purposes and was subject to certain other customary
restrictions. The Fund had no borrowings during the year ended Dec. 31, 2009
6. FEDERAL TAX INFORMATION
Net investment income (loss) and net realized gains (losses) may differ for
financial statement and tax purposes. The character of distributions made during
the year from net investment income or net realized gains may differ from their
ultimate characterization for federal income tax purposes. Also, due to the
timing of dividend distributions, the fiscal year in which amounts are
distributed may differ from the year that the income or realized gains (losses)
were recorded by the Fund.
The tax character of distributions paid for the years indicated is as follows:
<Table>
<Caption>
YEAR ENDED DEC. 31, 2009 2008
- ----------------------------------------------------------------
Ordinary income $44,634 $2,165,222
</Table>
At Dec. 31, 2009, the components of distributable earnings on a tax basis are as
follows:
<Table>
Undistributed ordinary income...................... $ 131
Undistributed accumulated long-term gain........... $ --
Unrealized appreciation (depreciation)............. $(2,621)
</Table>
7. SUBSEQUENT EVENTS
Management has evaluated Fund related events and transactions that occurred
during the period from the date of the Statement of Assets and Liabilities
through Feb. 22, 2010, the date of issuance of the Fund's financial statements.
There were no events or transactions that occurred during the period that
materially impacted the amounts or disclosures in the Fund's financial
statements.
8. INFORMATION REGARDING PENDING AND SETTLED LEGAL PROCEEDINGS
In June 2004, an action captioned John E. Gallus et al. v. American Express
Financial Corp. and American Express Financial Advisors Inc. was filed in the
United States District Court for the District of Arizona. The plaintiffs allege
that they are investors in several American Express Company (now known as
RiverSource) mutual funds and they purport to bring the action derivatively on
- --------------------------------------------------------------------------------
RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT 29
NOTES TO FINANCIAL STATEMENTS (continued) --------------------------------------
behalf of those funds under the Investment Company Act of 1940. The plaintiffs
allege that fees allegedly paid to the defendants by the funds for investment
advisory and administrative services are excessive. The plaintiffs seek remedies
including restitution and rescission of investment advisory and distribution
agreements. The plaintiffs voluntarily agreed to transfer this case to the
United States District Court for the District of Minnesota (the District Court).
In response to defendants' motion to dismiss the complaint, the District Court
dismissed one of plaintiffs' four claims and granted plaintiffs limited
discovery. Defendants moved for summary judgment in April 2007. Summary judgment
was granted in the defendants' favor on July 9, 2007. The plaintiffs filed a
notice of appeal with the Eighth Circuit Court of Appeals (the Eighth Circuit)
on August 8, 2007. On April 8, 2009, the Eighth Circuit reversed summary
judgment and remanded to the District Court for further proceedings. On August
6, 2009, defendants filed a writ of certiorari with the U.S. Supreme Court,
asking the U.S. Supreme Court to stay the District Court proceedings while the
U.S. Supreme Court considers and rules in a case captioned Jones v. Harris
Associates, which involves issues of law similar to those presented in the
Gallus case.
In December 2005, without admitting or denying the allegations, American Express
Financial Corporation (AEFC, which is now known as Ameriprise Financial, Inc.
(Ameriprise Financial)), entered into settlement agreements with the Securities
and Exchange Commission (SEC) and Minnesota Department of Commerce (MDOC)
related to market timing activities. As a result, AEFC was censured and ordered
to cease and desist from committing or causing any violations of certain
provisions of the Investment Advisers Act of 1940, the Investment Company Act of
1940, and various Minnesota laws. AEFC agreed to pay disgorgement of $10 million
and civil money penalties of $7 million. AEFC also agreed to retain an
independent distribution consultant to assist in developing a plan for
distribution of all disgorgement and civil penalties ordered by the SEC in
accordance with various undertakings detailed at
http://www.sec.gov/litigation/admin/ia-2451.pdf. Ameriprise Financial and its
affiliates have cooperated with the SEC and the MDOC in these legal proceedings,
and have made regular reports to the RiverSource Funds' Boards of
Directors/Trustees.
On November 7, 2008, RiverSource Investments, LLC, a subsidiary of Ameriprise
Financial, Inc., acquired J. & W. Seligman & Co. Incorporated (Seligman). In
late 2003, Seligman conducted an extensive internal review concerning mutual
fund trading practices. Seligman's review, which covered the period 2001-2003,
noted one arrangement that permitted frequent trading in certain open-end
registered investment companies managed by Seligman (the
- --------------------------------------------------------------------------------
30 RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT
- --------------------------------------------------------------------------------
Seligman Funds); this arrangement was in the process of being closed down by
Seligman before September 2003. Seligman identified three other arrangements
that permitted frequent trading, all of which had been terminated by September
2002. In January 2004, Seligman, on a voluntary basis, publicly disclosed these
four arrangements to its clients and to shareholders of the Seligman Funds.
Seligman also provided information concerning mutual fund trading practices to
the SEC and the Office of the Attorney General of the State of New York (NYAG).
In September 2006, the NYAG commenced a civil action in New York State Supreme
Court against Seligman, Seligman Advisors, Inc. (now known as RiverSource Fund
Distributors, Inc.), Seligman Data Corp. and Brian T. Zino (collectively, the
Seligman Parties), alleging, in substance, that the Seligman Parties permitted
various persons to engage in frequent trading and, as a result, the prospectus
disclosure used by the registered investment companies then managed by Seligman
was and had been misleading. The NYAG included other related claims and also
claimed that the fees charged by Seligman to the Seligman Funds were excessive.
On March 13, 2009, without admitting or denying any violations of law or
wrongdoing, the Seligman Parties entered into a stipulation of settlement with
the NYAG and settled the claims made by the NYAG. Under the terms of the
settlement, Seligman paid $11.3 million to four Seligman Funds. This settlement
resolved all outstanding matters between the Seligman Parties and the NYAG. In
addition to the foregoing matter, the New York staff of the SEC indicated in
September 2005 that it was considering recommending to the Commissioners of the
SEC the instituting of a formal action against Seligman and Seligman Advisors,
Inc. relating to frequent trading in the Seligman Funds. Seligman responded to
the staff in October 2005 that it believed that any action would be both
inappropriate and unnecessary, especially in light of the fact that Seligman had
previously resolved the underlying issue with the Independent Directors of the
Seligman Funds and made recompense to the affected Seligman Funds. There have
been no further developments with the SEC on this matter.
Ameriprise Financial and certain of its affiliates have historically been
involved in a number of legal, arbitration and regulatory proceedings, including
routine litigation, class actions, and governmental actions, concerning matters
arising in connection with the conduct of their business activities. Ameriprise
Financial believes that the Funds are not currently the subject of, and that
neither Ameriprise Financial nor any of its affiliates are the subject of, any
pending legal, arbitration or regulatory proceedings that are likely to have a
material adverse effect on the Funds or the ability of Ameriprise Financial or
its affiliates to perform under their contracts with the Funds. Ameriprise
Financial is required
- --------------------------------------------------------------------------------
RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT 31
NOTES TO FINANCIAL STATEMENTS (continued) --------------------------------------
to make 10-Q, 10-K and, as necessary, 8-K filings with the Securities and
Exchange Commission on legal and regulatory matters that relate to Ameriprise
Financial and its affiliates. Copies of these filings may be obtained by
accessing the SEC website at www.sec.gov.
There can be no assurance that these matters, or the adverse publicity
associated with them, will not result in increased fund redemptions, reduced
sale of fund shares or other adverse consequences to the Funds. Further,
although we believe proceedings are not likely to have a material adverse effect
on the Funds or the ability of Ameriprise Financial or its affiliates to perform
under their contracts with the Funds, these proceedings are subject to
uncertainties and, as such, we are unable to estimate the possible loss or range
of loss that may result. An adverse outcome in one or more of these proceedings
could result in adverse judgments, settlements, fines, penalties or other relief
that could have a material adverse effect on the consolidated financial
condition or results of operations of Ameriprise Financial.
- --------------------------------------------------------------------------------
32 RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM ------------------------
TO THE BOARD OF DIRECTORS AND SHAREHOLDERS OF
RIVERSOURCE GOVERNMENT MONEY MARKET FUND:
We have audited the accompanying statement of assets and liabilities, including
the portfolio of investments, of RiverSource Government Money Market Fund (the
Fund) (formerly Seligman Cash Management Fund) of the RiverSource Government
Money Market Series, Inc. as of December 31, 2009, and the related statements of
operations, changes in net assets, and the financial highlights for the year
then ended. These financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audit. The statement of changes in net assets and financial highlights of the
Fund for the periods presented through December 31, 2008, were audited by other
auditors whose report dated February 27, 2009, expressed an unqualified opinion
on those financial statements and financial highlights.
We conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material misstatement. We were
not engaged to perform an audit of the Fund's internal control over financial
reporting. Our audit included consideration of internal control over financial
reporting as a basis for designing audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Fund's internal control over financial reporting.
Accordingly, we express no such opinion. An audit also includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements and financial highlights, assessing the accounting principles used
and significant estimates made by management, and evaluating the overall
financial statement presentation. Our procedures included confirmation of
securities owned as of December 31, 2009, by correspondence with the custodian
and brokers, or by other appropriate auditing procedures where replies from
brokers were not received. We believe that our audit provides a reasonable basis
for our opinion.
- --------------------------------------------------------------------------------
RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT 33
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM (continued) ------------
In our opinion, the 2009 financial statements and financial highlights audited
by us as referred to above present fairly, in all material respects, the
financial position of RiverSource Government Money Market Fund of the
RiverSource Government Money Market Series, Inc. at December 31, 2009, the
results of its operations, changes in its net assets and the financial
highlights for the year then ended, in conformity with U.S. generally accepted
accounting principles.
/s/ Ernst & Young LLP
Minneapolis, Minnesota
Feb. 22, 2010
- --------------------------------------------------------------------------------
34 RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT
FEDERAL INCOME TAX INFORMATION -------------------------------------------------
(UNAUDITED)
The Fund is required by the Internal Revenue Code of 1986 to tell its
shareholders about the tax treatment of the dividends it pays during its fiscal
year. The dividends listed below are reported to you on Form 1099-DIV, Dividends
and Distributions. Shareholders should consult a tax advisor on how to report
distributions for state and local tax purposes.
Fiscal year ended Dec. 31, 2009
<Table>
<Caption>
INCOME DISTRIBUTIONS - the Fund designates the following tax attributes for
distributions:
Qualified Dividend Income for individuals.................... 0.00%
Dividends Received Deduction for corporations................ 0.00%
U.S. Government Obligations.................................. 100.00%
</Table>
The Fund designates as distributions of long-term gains, to the extent necessary
to fully distribute such capital gains, earnings and profits distributed to
shareholders on the redemption of shares.
- --------------------------------------------------------------------------------
RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT 35
BOARD MEMBERS AND OFFICERS -----------------------------------------------------
Shareholders elect a Board that oversees the Fund's operations. The Board
appoints officers who are responsible for day-to-day business decisions based on
policies set by the Board. The following is a list of the Fund's Board members.
The RiverSource Family of Funds that each Board member oversees consists of 132
funds, which includes 100 RiverSource funds and 32 Seligman funds. Board members
serve until the next regular shareholders' meeting or until he or she reaches
the mandatory retirement age established by the Board.
INDEPENDENT BOARD MEMBERS
<Table>
<Caption>
NAME, POSITION HELD
ADDRESS, WITH FUND AND PRINCIPAL OCCUPATION OTHER
AGE LENGTH OF SERVICE DURING PAST FIVE YEARS DIRECTORSHIPS
- ------------------------------------------------------------------------------------------------------------------------------
Kathleen Blatz Board member since Chief Justice, Minnesota Supreme Court, 1998-2006; None
901 S. Marquette Ave. 2006 Attorney
Minneapolis, MN 55402
Age 55
- ------------------------------------------------------------------------------------------------------------------------------
Arne H. Carlson Board member since Chair, RiverSource Family of Funds, 1999-2006; former None
901 S. Marquette Ave. 1999 Governor of Minnesota
Minneapolis, MN 55402
Age 75
- ------------------------------------------------------------------------------------------------------------------------------
Pamela G. Carlton Board member since President, Springboard -- Partners in Cross Cultural None
901 S. Marquette Ave. 2007 Leadership (consulting company)
Minneapolis, MN 55402
Age 55
- ------------------------------------------------------------------------------------------------------------------------------
Patricia M. Flynn Board member since Trustee Professor of Economics and Management, Bentley None
901 S. Marquette Ave. 2004 College; former Dean, McCallum Graduate School of
Minneapolis, MN 55402 Business, Bentley University
Age 59
- ------------------------------------------------------------------------------------------------------------------------------
Anne P. Jones Board member since Attorney and Consultant None
901 S. Marquette Ave. 1985
Minneapolis, MN 55402
Age 75
- ------------------------------------------------------------------------------------------------------------------------------
Jeffrey Laikind, CFA Board member since Former Managing Director, Shikiar Asset Management American Progressive
901 S. Marquette Ave. 2005 Insurance
Minneapolis, MN 55402
Age 74
- ------------------------------------------------------------------------------------------------------------------------------
Stephen R. Lewis, Jr. Chair of the Board President Emeritus and Professor of Economics, Carleton Valmont Industries,
901 S. Marquette Ave. since 2007, College Inc. (manufactures
Minneapolis, MN 55402 Board member since irrigation systems)
Age 71 2002
- ------------------------------------------------------------------------------------------------------------------------------
</Table>
- --------------------------------------------------------------------------------
36 RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT
- --------------------------------------------------------------------------------
INDEPENDENT BOARD MEMBERS (CONTINUED)
<Table>
<Caption>
NAME, POSITION HELD
ADDRESS, WITH FUND AND PRINCIPAL OCCUPATION OTHER
AGE LENGTH OF SERVICE DURING PAST FIVE YEARS DIRECTORSHIPS
- ------------------------------------------------------------------------------------------------------------------------------
John F. Maher Board member since Retired President and Chief Executive Officer and None
901 S. Marquette Ave. 2008 former Director, Great Western Financial Corporation
Minneapolis, MN 55402 (financial services), 1986-1997
Age 66
- ------------------------------------------------------------------------------------------------------------------------------
Catherine James Paglia Board member since Director, Enterprise Asset Management, Inc. (private None
901 S. Marquette Ave. 2004 real estate and asset management company)
Minneapolis, MN 55402
Age 57
- ------------------------------------------------------------------------------------------------------------------------------
Leroy C. Richie Board member since Counsel, Lewis & Munday, P.C. since 1987; Vice Digital Ally, Inc.
901 S. Marquette Ave. 2008 President and General Counsel, Automotive Legal (digital imaging);
Minneapolis, MN 55402 Affairs, Chrysler Corporation, 1990-1997 Infinity, Inc. (oil
Age 68 and gas exploration
and production); OGE
Energy Corp. (energy
and energy services)
- ------------------------------------------------------------------------------------------------------------------------------
Alison Taunton-Rigby Board member since Chief Executive Officer and Director, RiboNovix, Inc. Idera
901 S. Marquette Ave. 2002 since 2003 (biotechnology); former President, Aquila Pharmaceuticals,
Minneapolis, MN 55402 Biopharmaceuticals Inc.
Age 65 (biotechnology);
Healthways, Inc.
(health management
programs)
- ------------------------------------------------------------------------------------------------------------------------------
</Table>
- --------------------------------------------------------------------------------
RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT 37
BOARD MEMBERS AND OFFICERS (continued) -----------------------------------------
BOARD MEMBER AFFILIATED WITH RIVERSOURCE INVESTMENTS*
<Table>
<Caption>
NAME, POSITION HELD
ADDRESS, WITH FUND AND PRINCIPAL OCCUPATION OTHER
AGE LENGTH OF SERVICE DURING PAST FIVE YEARS DIRECTORSHIPS
- ------------------------------------------------------------------------------------------------------------------------------
William F. Truscott Board member since President -- U.S. Asset Management and Chief Investment None
53600 Ameriprise 2001, Officer, Ameriprise Financial, Inc. since 2005;
Financial Center Vice President since President, Chairman of the Board and Chief Investment
Minneapolis, MN 55474 2002 Officer, RiverSource Investments, LLC since 2001;
Age 49 Director, President and Chief Executive Officer,
Ameriprise Certificate Company since 2006; Chairman of
the Board and Chief Executive Officer, RiverSource
Distributors, Inc. since 2006 and of RiverSource Fund
Distributors, Inc. since 2008; Senior Vice
President -- Chief Investment Officer, Ameriprise
Financial, Inc., 2001-2005
- ------------------------------------------------------------------------------------------------------------------------------
</Table>
* Interested person by reason of being an officer, director, security holder
and/or employee of RiverSource Investments or Ameriprise Financial.
The SAI has additional information about the Fund's Board members and is
available, without charge, upon request by calling the RiverSource Family of
Funds at 1(800) 221-2450; contacting your financial intermediary; or visiting
riversource.com/funds (for RiverSource and Threadneedle funds) or seligman.com
(for Seligman funds).
The Board has appointed officers who are responsible for day-to-day business
decisions based on policies it has established. The officers serve at the
pleasure of the Board. In addition to Mr. Truscott, who is Vice President, the
Fund's other officers are:
FUND OFFICERS
<Table>
<Caption>
NAME, POSITION HELD
ADDRESS, WITH FUND AND PRINCIPAL OCCUPATION
AGE LENGTH OF SERVICE DURING PAST FIVE YEARS
- --------------------------------------------------------------------------------------------------------
Patrick T. Bannigan President since 2006 Director and Senior Vice President -- Asset Management,
172 Ameriprise Financial Products and Marketing, RiverSource Investments, LLC
Center and Director and Vice President -- Asset Management,
Minneapolis, MN 55474 Products and Marketing, RiverSource Distributors, Inc.
Age 44 since 2006 and of RiverSource Fund Distributors, Inc.
since 2008; Managing Director and Global Head of
Product, Morgan Stanley Investment Management, 2004-
2006; President, Touchstone Investments, 2002-2004
- --------------------------------------------------------------------------------------------------------
</Table>
- --------------------------------------------------------------------------------
38 RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT
- --------------------------------------------------------------------------------
FUND OFFICERS (CONTINUED)
<Table>
<Caption>
NAME, POSITION HELD
ADDRESS, WITH FUND AND PRINCIPAL OCCUPATION
AGE LENGTH OF SERVICE DURING PAST FIVE YEARS
- --------------------------------------------------------------------------------------------------------
Michelle M. Keeley Vice President since Executive Vice President -- Equity and Fixed Income,
172 Ameriprise Financial 2004 Ameriprise Financial, Inc. and RiverSource Investments,
Center LLC since 2006; Vice President -- Investments,
Minneapolis, MN 55474 Ameriprise Certificate Company since 2003; Senior Vice
Age 45 President -- Fixed Income, Ameriprise Financial, Inc.,
2002-2006 and RiverSource Investments, LLC, 2004-2006
- --------------------------------------------------------------------------------------------------------
Amy K. Johnson Vice President since Chief Administrative Officer, RiverSource Investments,
5228 Ameriprise Financial 2006 LLC since 2009; Vice President -- Asset Management and
Center Minneapolis, MN Trust Company Services, RiverSource Investments, LLC,
55474 2006-2009; Vice President -- Operations and Compliance,
Age 44 RiverSource Investments, LLC, 2004-2006; Director of
Product Development -- Mutual Funds, Ameriprise
Financial, Inc., 2001-2004
- --------------------------------------------------------------------------------------------------------
Jeffrey P. Fox Treasurer since 2002 Vice President -- Investment Accounting, Ameriprise
105 Ameriprise Financial Financial, Inc. since 2002; Chief Financial Officer,
Center RiverSource Distributors, Inc. since 2006 and of
Minneapolis, MN 55474 RiverSource Fund Distributors, Inc. since 2008
Age 54
- --------------------------------------------------------------------------------------------------------
Scott R. Plummer Vice President, Vice President and Chief Counsel -- Asset Management,
5228 Ameriprise Financial General Counsel and Ameriprise Financial, Inc. since 2005; Chief Counsel,
Center Secretary since 2006 RiverSource Distributors, Inc. and Chief Legal Officer
Minneapolis, MN 55474 and Assistant Secretary, RiverSource Investments, LLC
Age 50 since 2006; Chief Counsel, RiverSource Fund
Distributors, Inc. since 2008; Vice President, General
Counsel and Secretary, Ameriprise Certificate Company
since 2005; Vice President -- Asset Management
Compliance, Ameriprise Financial, Inc., 2004-2005;
Senior Vice President and Chief Compliance Officer,
USBancorp Asset Management, 2002-2004
- --------------------------------------------------------------------------------------------------------
Eleanor T.M. Hoagland Chief Compliance Chief Compliance Officer, RiverSource Investments, LLC,
100 Park Avenue Officer since 2009 Ameriprise Certificate Company and RiverSource Service
New York, NY 10010 Corporation since 2009; Chief Compliance Officer for
Age 58 each of the Seligman funds since 2004; Anti-Money
Laundering Prevention Officer and Identity Theft
Prevention Officer for each of the Seligman funds since
2008; Managing Director, J. & W. Seligman & Co.
Incorporated and Vice-President for each of the
Seligman funds, 2004-2008
- --------------------------------------------------------------------------------------------------------
Neysa M. Alecu Money Laundering Vice President -- Compliance, Ameriprise Financial,
2934 Ameriprise Financial Prevention Officer Inc. since 2008; Anti-Money Laundering Officer,
Center since 2004 and Ameriprise Financial, Inc. since 2005; Compliance
Minneapolis, MN 55474 Identity Theft Director, Ameriprise Financial, Inc., 2004-2008
Age 46 Prevention Officer
since 2008
- --------------------------------------------------------------------------------------------------------
</Table>
- --------------------------------------------------------------------------------
RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT 39
PROXY VOTING -------------------------------------------------------------------
The policy of the Board is to vote the proxies of the companies in which the
Fund holds investments consistent with the procedures as stated in the Statement
of Additional Information (SAI). You may obtain a copy of the SAI without charge
by calling the RiverSource Family of Funds at 1(800) 221-2450; contacting your
financial intermediary; visiting riversource.com/funds; or searching the website
of the Securities and Exchange Commission (SEC) at http://www.sec.gov.
Information regarding how the Fund voted proxies relating to portfolio
securities is filed with the SEC by August 31 for the most recent 12-month
period ending June 30 of that year, and is available without charge by visiting
riversource.com/funds; or searching the website of the SEC at www.sec.gov.
- --------------------------------------------------------------------------------
40 RIVERSOURCE GOVERNMENT MONEY MARKET FUND -- 2009 ANNUAL REPORT
RIVERSOURCE GOVERNMENT MONEY MARKET FUND
734 Ameriprise Financial Center
Minneapolis, MN 55474
RIVERSOURCE.COM/FUNDS
<Table>
This report must be accompanied or preceded by the Fund's
current prospectus. RiverSource(R) mutual funds are
distributed by RiverSource Fund Distributors, Inc., Member
FINRA, and managed by RiverSource Investments, LLC.
RiverSource is part of Ameriprise Financial, Inc.
(RIVERSOURCE INVESTMENTS LOGO) (C)2010 RiverSource Investments, LLC. SL-9905 A (3/10)
</Table>
Item 2. (a) The Registrant has adopted a code of ethics that applies to the
Registrant's principal executive officer and principal financial
officer. A copy of the code of ethics is filed as an exhibit to this
form N-CSR.
(b) During the period covered by this report, there were not any
amendments to the provisions of the code of ethics adopted in 2(a)
above.
(c) During the period covered by this report, there were not any
implicit or explicit waivers to the provisions of the code of ethics
adopted in 2(a).
Item 3. The Registrant's board of directors has determined that independent
directors Pamela G. Carlton, Jeffrey Laikind, John F. Maher and Anne
P. Jones, each qualify as audit committee financial experts.
Item 4. Principal Accountant Fees and Services
(a) Audit Fees. The fees for the year ended Dec. 31, to Ernst & Young LLP for
professional services rendered for the audit of the annual financial
statements for RiverSource Government Money Market Fund, Inc. were as
follows:
2009 - $21,885
(b) Audit-Related Fees. The fees for the year ended Dec. 31, to Ernst & Young
LLP for additional audit-related services rendered related to the
semiannual financial statement review, the transfer agent 17Ad-13 review
and other consultations and services required to complete the audit for
RiverSource Government Money Market Fund, Inc. were as follows:
2009 - $2,184
(c) Tax Fees. The fees for the year ended Dec. 31, to Ernst & Young LLP for
tax compliance related services rendered for RiverSource Government Money
Market Fund, Inc. were as follows:
2009 - $2,862
(d) All Other Fees. The fees for the year ended Dec. 31, to Ernst & Young LLP
for additional professional services rendered for RiverSource Government
Money Market Fund, Inc. were as follows:
2009 - $0
(e) (1) Audit Committee Pre-Approval Policy. Pursuant to Sarbanes-Oxley
pre-approval requirements, all services to be performed by Ernst & Young LLP
for the registrant and to the registrant's investment adviser and any entity
controlling, controlled by, or under common control with the investment
adviser that provides ongoing services to the registrant must be pre-approved
by the audit committee.
(e) (2) 100% of the services performed for items (b) through (d) above during
2009 were pre-approved by the audit committee.
(f) Not applicable.
(g) Non-Audit Fees. The fees for the year ended Dec. 31, to Ernst & Young LLP
by the registrant for non-audit fees and by the registrant's investment
adviser, and any entity controlling, controlled by, or under common
control with the adviser that provides ongoing services to the registrant
were as follows:
2009 - $803,732
(h) 100% of the services performed in item (g) above during 2009 were
pre-approved by the Ameriprise Financial Audit Committee and/or the
RiverSource Mutual Funds Audit Committee.
Item 5. Audit Committee of Listed Registrants. Not applicable.
Item 6. Investments.
(a) The complete schedule of investments is included in Item 1 of this Form
N-CSR.
(b) Not applicable.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies. Not applicable.
Item 8. Portfolio Managers of Closed-End Management Investment Companies.
Not applicable.
Item 9. Purchase of Equity Securities by Closed-End Management Investment
Company and Affiliated Purchasers. Not applicable.
Item 10. Submission of matters to a vote of security holders. Not applicable.
Item 11. Controls and Procedures.
(a) Based upon their evaluation of the registrant's disclosure
controls and procedures as conducted within 90 days of the filing
date of this Form N-CSR, the registrant's Principal Financial
Officer and Principal Executive Officer have concluded that those
disclosure controls and procedures provide reasonable assurance that
the material information required to be disclosed by the registrant
on this report is recorded, processed, summarized and reported
within the time periods specified in the Securities and Exchange
Commission's rules and forms.
(b) There were no changes in the registrant's internal controls over
financial reporting that occurred during the registrant's last
fiscal half-year (the registrant's second fiscal half-year in the
case of an annual report) that has materially affected, or is
reasonably likely to materially affect, the registrant's internal
control over financial reporting.
Item 12. Exhibits.
(a)(1) Code of ethics as applies to the Registrant's principal
executive officer and principal financial officer, as required to be
disclosed under Item 2 of Form N-CSR, is attached as Ex. 99.CODE
ETH.
(a)(2) Separate certification for the Registrant's principal
executive officer and principal financial officer, as required by
Section 302 of the Sarbanes-Oxley Act of 2002 and Rule 30a-2(a)
under the Investment Company Act of 1940, are attached as
EX.99.CERT.
(a)(3) Not applicable.
(b) A certification by the Registrant's principal executive officer
and principal financial officer, pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002 and Rule 30a-2(b) under the Investment
Company Act of 1940, is attached as EX.99.906 CERT.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the Registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) RiverSource Government Money Market Fund, Inc.
By /s/ Patrick T. Bannigan
-----------------------------------------
Patrick T. Bannigan
President and Principal Executive Officer
Date March 5, 2010
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/ Patrick T. Bannigan
-----------------------------------------
Patrick T. Bannigan
President and Principal Executive Officer
Date March 5, 2010
By /s/ Jeffrey P. Fox
-----------------------------------------
Jeffrey P. Fox
Treasurer and Principal Financial Officer
Date March 5, 2010