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 811-2591
RIVERSOURCE MONEY MARKET SERIES, 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
(Name and address of agent for service)
Registrant's telephone number, including area code: (612) 671-1947
Date of fiscal year end: 7/31
Date of reporting period: 7/31
Annual Report
and Prospectus
(RIVERSOURCE INVESTMENTS LOGO)
RIVERSOURCE(R)
CASH MANAGEMENT FUND
ANNUAL REPORT FOR
THE PERIOD ENDED
JULY 31, 2007
(Prospectus also enclosed)
RIVERSOURCE CASH MANAGEMENT FUND
SEEKS TO PROVIDE SHAREHOLDERS WITH
MAXIMUM CURRENT INCOME CONSISTENT
WITH LIQUIDITY AND STABILITY OF
PRINCIPAL.
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.
(FRONT COVER ART)
TABLE OF CONTENTS
<Table>
Fund Snapshot....................... 3
Performance Summary................. 4
Questions & Answers
with Portfolio Management........ 6
Fund Expenses Example............... 9
Investments in Securities........... 11
Financial Statements................ 15
Notes to Financial Statements....... 18
Report of Independent Registered
Public Accounting Firm........... 33
Federal Income Tax Information...... 34
Board Members and Officers.......... 38
Approval of Investment Management
Services Agreement............... 42
Proxy Voting........................ 44
Change in Independent Registered
Public Accounting Firm........... 44
</Table>
(DALBAR LOGO)
The RiverSource mutual fund
shareholder reports have been
awarded the Communications Seal
from Dalbar Inc., an independent
financial services research firm.
The Seal recognizes communications
demonstrating a level of
excellence in the industry.
- --------------------------------------------------------------------------------
2 RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT
FUND SNAPSHOT AT JULY 31, 2007
FUND OBJECTIVE
RiverSource Cash Management Fund seeks to provide shareholders with maximum
current income consistent with liquidity and stability of principal.
SECTOR BREAKDOWN
Percentage of portfolio assets
(PIE CHART)
<Table>
<Caption>
COMMERCIAL PAPER CERTIFICATES OF DEPOSIT FLOATING RATE NOTES
- ---------------- ----------------------- -------------------
68.0% 8.9% 23.1%
</Table>
STYLE MATRIX
<Table>
<Caption>
DURATION
SHORT INT. LONG
X HIGH
MEDIUM QUALITY
LOW
</Table>
Shading within the style matrix indicates areas in which the Fund generally
invests.
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 serves as a guideline for helping
you build a portfolio.
Investment products, including shares of mutual funds, involve investment risks
including possible loss of principal and fluctuation in value.
FUND FACTS
<Table>
<Caption>
TICKER SYMBOL INCEPTION DATE
Class A IDSXX 10/06/75
Class B ACBXX 03/20/95
Class C RCCXX 06/26/00
Class I RCIXX 03/04/04
Class R5 -- 12/11/06
Class W RCWXX 12/01/06
Class Y IDYXX 03/20/95
Total net assets $4.954 billion
Number of holdings 142
WEIGHTED AVERAGE MATURITY(1) 64 days
</Table>
(1) WEIGHTED AVERAGE MATURITY is the amount of time remaining before securities
are due and principal must be repaid.
An Investment in a money market fund 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 CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT 3
PERFORMANCE SUMMARY
FUND PERFORMANCE
For the year ended July 31, 2007
(BAR CHART)
<Table>
RiverSource Cash Management Fund Class A +4.80
</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 institution or
visiting riversource.com/funds.
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 seven-day current
yield more closely reflects the current earnings of the Fund than the total
return. The performance of other classes may vary from that shown because of
differences in expenses.
ANNUAL OPERATING EXPENSE RATIO (AS OF THE CURRENT PROSPECTUS)
<Table>
<Caption>
TOTAL NET EXPENSES(A)
Class A 0.70% 0.69%
Class B 1.46% 1.35%
Class C 1.36% 1.35%
Class I 0.38% 0.38%
Class R5(b) 0.44% 0.44%
Class W(c) 0.65% 0.65%
Class Y 0.59% 0.59%
</Table>
(a) The investment manager and its affiliates have contractually agreed to
waive certain fees and to absorb certain expenses until July 31, 2008,
unless sooner terminated at the discretion of the Fund's Board. Any amounts
waived will not be reimbursed by the Fund. Under this agreement, net fund
expenses will not exceed 0.69% for Class A, 1.35% for Class B, 1.35% for
Class C, 0.46% for Class I, 0.51% for Class R5, 0.76% for Class W and 0.64%
for Class Y.
(b) Inception date for Class R5 is Dec. 11, 2006.
(c) Inception date for Class W is Dec. 1, 2006.
- --------------------------------------------------------------------------------
4 RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT
PERFORMANCE SUMMARY
AVERAGE ANNUAL TOTAL RETURNS
<Table>
<Caption>
AT JULY 31, 2007
SINCE
WITHOUT SALES CHARGE 1 YEAR 3 YEARS 5 YEARS 10 YEARS INCEPTION
Class A (inception 10/6/75) +4.80% +3.41% +2.26% +3.41% +6.11%
Class B (inception 3/20/95) +4.11% +2.73% +1.68% +2.73% +3.07%
Class C (inception 6/26/00) +4.12% +2.74% +1.69% N/A +2.09%
Class I (inception 3/4/04) +5.14% +3.77% N/A N/A +3.40%
Class R5 (inception 12/11/06) N/A N/A N/A N/A +3.20%*
Class W (inception 12/1/06) N/A N/A N/A N/A +3.13%*
Class Y (inception 3/20/95) +4.92% +3.54% +2.38% +3.48% +3.82%
WITH SALES CHARGE
Class B (inception 3/20/95) -0.89% +1.45% +1.31% +2.73% +3.07%
Class C (inception 6/26/00) +3.12% +2.74% +1.69% N/A +2.09%
</Table>
<Table>
<Caption>
AT JUNE 30, 2007
SINCE
WITHOUT SALES CHARGE 1 YEAR 3 YEARS 5 YEARS 10 YEARS INCEPTION
Class A (inception 10/6/75) +4.79% +3.28% +2.20% +3.41% +6.12%
Class B (inception 3/20/95) +4.10% +2.61% +1.62% +2.73% +3.06%
Class C (inception 6/26/00) +4.11% +2.62% +1.62% N/A +2.07%
Class I (inception 3/4/04) +5.12% +3.64% N/A N/A +3.36%
Class R5 (inception 12/11/06) N/A N/A N/A N/A +2.74%*
Class W (inception 12/1/06) N/A N/A N/A N/A +2.71%*
Class Y (inception 3/20/95) +4.91% +3.41% +2.32% +3.47% +3.81%
WITH SALES CHARGE
Class B (inception 3/20/95) -0.90% +1.33% +1.24% +2.73% +3.06%
Class C (inception 6/26/00) +3.11% +2.62% +1.62% N/A +2.07%
</Table>
* Not annualized.
Sales charges do not apply to Class A, Class I, Class R5, Class W and Class Y
shares. Class B share performance reflects a contingent deferred sales charge
(CDSC) applied as follows: first year 5%; second and third years 4%; fourth year
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
I, Class R5 and Class Y are available to institutional investors only. Class W
shares are offered through qualifying discretionary accounts.
- --------------------------------------------------------------------------------
RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT 5
QUESTIONS & ANSWERS WITH PORTFOLIO MANAGEMENT
Below is the discussion of RiverSource Cash Management Fund's results and
strategy for the 12 months ended July 31, 2007.
Q: How did RiverSource Cash Management Fund perform for the annual period?
A: RiverSource Cash Management Fund's Class A shares returned 4.80% for the
annual period. The Fund's annualized simple yield was 4.78% and its
annualized compound yield was 4.89% for the seven-day period ended July 31,
2007.* The Fund serves as a conservative, shorter-term investment choice for
individuals seeking current income.
Q: What factors most significantly affected the Fund's performance?
A: Changing expectations of future Federal Reserve Board (Fed) policy, inflation
readings, and the relative strength or weakness of economic growth had the
greatest effect on the Fund's results. During the period, language from the
Fed introduced the possibility of an interest rate cut in the future.
However, the deteriorating economic picture many had painted based on data
indicating a slowdown in the housing market, production cutbacks at auto
makers, persistent inflation pressures and moderating economic growth did not
materialize, leading most economists toward the end of the period to expect
the Fed to be on hold indefinitely.
During most of the first half of the fiscal year, the money market yield
curve flattened, as short-term yields continued to move higher. Toward the
end of 2006, as expectations of Fed eases were priced into the market, the
money market yield curve actually inverted, meaning yields at the short-term
end of the curve were higher than those at the long-term end of the curve. As
the Fed easing was priced out of the market with changing economic data, the
money market yield curve became positively sloped, with long-term yields
higher than short-term yields. Throughout the fiscal year, we believed that
the Fed was on hold for an extended period of time and positioned the Fund
accordingly.
CHANGING EXPECTATIONS OF FUTURE FEDERAL RESERVE BOARD (FED) POLICY,
INFLATION READINGS, AND THE RELATIVE STRENGTH OR WEAKNESS OF ECONOMIC
GROWTH HAD THE GREATEST EFFECT ON THE FUND'S RESULTS.
* The 7-day yields shown reflect more closely the earnings of the Fund than the
total return. Short- term yields may be higher or lower than the figures
shown.
- --------------------------------------------------------------------------------
6 RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT
QUESTIONS & ANSWERS
Q: What changes did you make to the Fund during the period?
A: Given our belief that the Fed was firmly on hold during the period, we sought
to take advantage of mispricings in the market to benefit our shareholders.
For example, in early August 2006, when the Fed observed its first pause
following a two-year tightening cycle, we became less defensive and invested
more in longer-dated fixed rate securities. These longer-dated purchases
enabled the Fund to lock in higher yields vs. floating rate issues, which are
reset in line with changes in market interest rates. These fixed rate
securities also lengthened the Fund's average maturity from 52 days at July
31, 2006, to 62 days by the end of January 2007.
During February and March, we allowed the Fund's average weighted maturity to
roll down to 44 days. We also opportunistically added one-to-three month
commercial paper and certificates of deposit to shorten the Fund's average
weighted maturity. Once the yield curve became positively sloped, we
opportunistically lengthened the Fund's average weighted maturity once again
to 73 days to lock in the higher yields then available. As we had done
earlier in the fiscal year, we carried out this strategy by replacing some
floating rate issues with more longer-dated fixed rate securities. Overall,
these changes made to the Fund's weighted average maturity as market
conditions shifted helped the Fund's results.
As of July 31, 2007, the average weighted maturity of the Fund was 64 days.
As always, we attempted to maximize the Fund's yield without taking
unnecessary risks. We continued to invest in high quality securities.
- --------------------------------------------------------------------------------
RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT 7
QUESTIONS & ANSWERS
Q: What is the Fund's tactical view and strategy for the months ahead?
A: As always, we will continue to closely monitor economic data, Fed policy and
any shifts in the money market yield curve, striving to strategically adjust
our portfolio positioning accordingly. We intend to continue to focus on high
quality investments with minimal credit risk while seeking competitive
yields.
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 RiverSource Fund are based on numerous
factors, may not be relied on as an indication of trading intent on behalf of
any RiverSource Fund.
- --------------------------------------------------------------------------------
8 RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT
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 July 31, 2007.
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.
See accompanying notes to investments in securities.
- --------------------------------------------------------------------------------
RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT 9
<Table>
<Caption>
BEGINNING ENDING EXPENSES
ACCOUNT VALUE ACCOUNT VALUE PAID DURING ANNUALIZED
FEB. 1, 2007 JULY 31, 2007 THE PERIOD(A) EXPENSE RATIO
Class A
Actual(b) $1,000 $1,023.60 $3.41(c) .68%
Hypothetical
(5% return before
expenses) $1,000 $1,021.42 $3.41(c) .68%
Class B
Actual(b) $1,000 $1,020.20 $6.76(c) 1.35%
Hypothetical
(5% return before
expenses) $1,000 $1,018.10 $6.76(c) 1.35%
Class C
Actual(b) $1,000 $1,020.30 $6.71(c) 1.34%
Hypothetical
(5% return before
expenses) $1,000 $1,018.15 $6.71(c) 1.34%
Class I
Actual(b) $1,000 $1,025.20 $1.86(c) .37%
Hypothetical
(5% return before
expenses) $1,000 $1,022.96 $1.86(c) .37%
Class R5
Actual(b) $1,000 $1,025.20 $2.16(c) .43%
Hypothetical
(5% return before
expenses) $1,000 $1,022.66 $2.16(c) .43%
Class W
Actual(b) $1,000 $1,023.60 $3.26(c) .65%
Hypothetical
(5% return before
expenses) $1,000 $1,021.92 $3.26(c) .65%
Class Y
Actual(b) $1,000 $1,024.10 $2.91(c) .58%
Hypothetical
(5% return before
expenses) $1,000 $1,021.92 $2.91(c) .58%
</Table>
(a) Expenses are equal to the Fund's annualized expense ratio as indicated
above, multiplied by the average account value over the period, multiplied
by 181/365 (to reflect the one-half year period).
(b) Based on the actual return for the six months ended July 31, 2007: +2.36%
for Class A, +2.02% for Class B, +2.03% for Class C, +2.52% for Class I,
+2.52% for Class R5, +2.36% for Class W and +2.41% for Class Y.
(c) The investment manager and its affiliates have contractually agreed to
waive certain fees and to absorb certain expenses until July 31, 2008,
unless sooner terminated at the discretion of the Fund's Board, such that
net expenses will not exceed 0.69% for Class A, 1.35% for Class B, 1.35%
for Class C, 0.46% for Class I, 0.51% for Class R5, 0.76% for Class W and
0.64% for Class Y. Any amounts waived will not be reimbursed by the Fund.
This change was effective Aug. 1, 2007. If this change had been in place
for the entire six month period ended July 31, 2007, the actual and
hypothetical expenses paid for Class A, Class B, Class C, Class I, Class
R5, Class W and Class Y would have been the same as those presented in the
table above.
See accompanying notes to investments in securities.
- --------------------------------------------------------------------------------
10 RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT
INVESTMENTS IN SECURITIES
JULY 31, 2007
(Percentages represent value of investments compared to net assets)
<Table>
<Caption>
CERTIFICATES OF DEPOSIT (8.8%)
AMOUNT
EFFECTIVE PAYABLE AT
ISSUER YIELD MATURITY VALUE(A)
Barclays Bank
03-17-08 5.28% $32,000,000(b) $31,997,276
05-30-08 5.28 40,000,000 40,000,000
Credit Suisse NY
01-14-08 5.15 34,000,000 34,000,000
02-26-08 5.33 73,000,000(b) 73,000,000
06-16-08 5.41 42,000,000 42,000,000
Deutsche Bank
10-10-07 5.22 40,000,000 40,000,000
04-14-08 5.26 40,000,000 40,000,000
Deutsche Bank NY
05-22-08 5.31 50,000,000 50,000,000
Natixis
03-31-08 5.40 50,000,000(b) 50,000,000
04-02-08 5.40 36,500,000(b) 36,495,292
- -----------------------------------------------------------------------------------
TOTAL CERTIFICATES OF DEPOSIT
(Cost: $437,492,568) $437,492,568
- -----------------------------------------------------------------------------------
</Table>
<Table>
<Caption>
FLOATING RATE NOTES (22.8%)(b)
AMOUNT
EFFECTIVE PAYABLE AT
ISSUER YIELD MATURITY VALUE(A)
Bank of Ireland
08-15-08 5.36% $50,000,000 $50,000,000
Bank of New York
08-11-08 5.29 40,000,000 40,000,000
Bear Stearns Companies
10-05-07 5.33 45,000,000 45,000,000
07-14-08 5.38 25,000,000 25,000,000
07-25-08 5.38 30,000,000 30,000,000
Cullinan Finance
03-28-08 5.32 37,000,000 36,996,341
04-28-08 5.32 31,000,000 30,996,566
</Table>
<Table>
<Caption>
FLOATING RATE NOTES (CONTINUED)
AMOUNT
EFFECTIVE PAYABLE AT
ISSUER YIELD MATURITY VALUE(A)
DEPFA Bank
06-13-08 5.42% $50,000,000 $50,000,000
General Electric Capital
08-22-08 5.30 10,000,000 10,000,000
Goldman Sachs Group
08-14-08 5.37 25,000,000 25,000,000
HSBC Finance
08-22-08 5.37 25,000,000 25,000,000
Irish Life & Permanent
08-20-08 5.34 35,000,000 34,998,146
Lehman Brothers
08-26-08 5.35 40,000,000 40,000,000
Lloyds TSB Group
08-05-08 5.32 40,000,000 40,000,000
Merrill Lynch & Co
08-14-08 5.33 30,000,000 30,000,000
08-15-08 5.30 40,000,000 40,000,000
08-22-08 5.31 48,000,000 48,000,000
MetLife Global Funding I
07-21-08 5.31 30,000,000 30,000,000
Natexis Banques Populaires
08-07-08 5.35 30,000,000 30,000,000
08-15-08 5.33 27,000,000 27,000,000
Northern Rock
07-08-08 5.45 59,300,000 59,300,000
08-01-08 5.38 15,000,000 15,000,000
Sedna Finance
09-20-07 5.33 78,000,000 77,999,466
01-18-08 5.32 42,000,000 41,998,044
</Table>
See accompanying notes to investments in securities.
- --------------------------------------------------------------------------------
RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT 11
<Table>
<Caption>
FLOATING RATE NOTES (CONTINUED)
AMOUNT
EFFECTIVE PAYABLE AT
ISSUER YIELD MATURITY VALUE(A)
Skandinaviska Enskilda Banken
08-08-08 5.32% $20,000,000 $20,000,000
08-15-08 5.34 30,000,000 30,000,000
08-22-08 5.33 43,000,000 43,000,000
Wells Fargo Bank
08-01-08 5.33 20,000,000 20,000,000
Westpac Banking
07-10-08 5.42 59,300,000 59,300,000
White Pine Finance LLC
02-25-08 5.36 35,000,000 35,003,221
03-20-08 5.28 40,000,000 39,994,929
- -----------------------------------------------------------------------------------
TOTAL FLOATING RATE NOTES
(Cost: $1,129,586,713) $1,129,586,713
- -----------------------------------------------------------------------------------
</Table>
<Table>
<Caption>
COMMERCIAL PAPER (67.3%)
AMOUNT
EFFECTIVE PAYABLE AT
ISSUER YIELD MATURITY VALUE(A)
ASSET-BACKED (62.6%)
Amsterdam Funding
08-14-07 4.98% $13,000,000(c) $ 12,975,213
Asscher Finance
08-09-07 4.77 34,700,000 34,659,208
Axon Financial Funding LLC
10-01-07 5.30 25,800,000 25,569,832
10-04-07 5.31 40,000,000 39,625,244
10-18-07 5.33 18,600,000 18,388,022
BA Credit Card Trust
08-01-07 5.38 30,000,000(c) 30,000,000
08-02-07 2.66 37,900,000(c) 37,894,483
08-07-07 4.56 40,000,000(c) 39,965,067
08-08-07 4.71 25,000,000(c) 24,974,236
09-19-07 5.28 11,060,000(c) 10,980,591
10-03-07 5.31 37,100,000(c) 36,757,845
CAFCO LLC
08-23-07 5.14 2,000,000(c) 1,993,547
</Table>
<Table>
<Caption>
COMMERCIAL PAPER (CONTINUED)
AMOUNT
EFFECTIVE PAYABLE AT
ISSUER YIELD MATURITY VALUE(A)
ASSET-BACKED (CONT.)
Chariot Funding LLC
08-13-07 4.95% $10,000,000(c) $ 9,982,400
08-27-07 5.19 42,700,000(c) 42,536,554
09-18-07 5.26 20,600,000(c) 20,455,525
CHARTA LLC
09-13-07 5.23 28,700,000(c) 28,520,027
Chesham Finance LLC
09-04-07 5.22 49,800,000 49,551,899
10-03-07 5.31 30,000,000 29,723,325
10-11-07 5.24 80,000,000 79,181,132
10-19-07 5.24 33,000,000 32,625,606
Cheyne Finance LLC
08-03-07 3.55 20,000,000 19,994,167
09-13-07 5.24 27,000,000 26,830,365
09-19-07 5.27 20,600,000 20,452,235
10-18-07 5.24 23,000,000 22,741,863
Citibank Credit Card Issue Trust
(Dakota Nts)
08-21-07 5.07 26,000,000(c) 25,924,311
09-21-07 5.29 68,000,000(c) 67,491,360
10-24-07 5.34 80,000,000(c) 79,018,132
Citigroup Funding
08-17-07 5.01 35,000,000 34,918,489
09-17-07 5.26 40,000,000 39,725,311
10-15-07 5.31 43,950,000 43,469,297
10-23-07 5.32 46,400,000 45,838,367
10-26-07 5.34 38,000,000 37,522,509
CRC Funding LLC
08-01-07 5.39 32,000,000(c) 32,000,000
08-15-07 4.98 40,000,000(c) 39,918,256
08-21-07 5.13 20,000,000(c) 19,941,111
10-23-07 5.32 28,000,000(c) 27,661,083
Cullinan Finance
04-25-08 5.32 40,000,000 40,000,000
Deer Valley Funding LLC
08-20-07 5.08 59,100,000 58,935,932
09-11-07 5.25 42,000,000 41,747,918
10-12-07 5.34 45,000,000 44,524,800
Dorada Finance
09-12-07 5.22 31,000,000 30,810,668
</Table>
See accompanying notes to investments in securities.
- --------------------------------------------------------------------------------
12 RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT
<Table>
<Caption>
COMMERCIAL PAPER (CONTINUED)
AMOUNT
EFFECTIVE PAYABLE AT
ISSUER YIELD MATURITY VALUE(A)
ASSET-BACKED (CONT.)
Ebury Finance LLC
08-01-07 5.45% $40,000,000 $ 40,000,000
09-05-07 5.22 47,000,000 46,759,190
09-14-07 5.31 25,000,000 24,837,444
10-05-07 5.32 46,300,000 45,858,607
10-09-07 5.33 50,000,000 49,494,000
Fairway Finance LLC
08-06-07 4.48 63,000,000(c) 62,953,625
Five Finance
08-30-07 5.17 30,000,000 29,873,125
09-07-07 5.21 20,000,000 19,892,083
Galaxy Funding
08-10-07 4.78 10,000,000(c) 9,986,913
08-16-07 4.99 52,000,000(c) 51,886,467
Gemini Securitization
08-28-07 5.15 56,000,000(c) 55,779,500
09-06-07 5.21 20,000,000(c) 19,895,000
09-07-07 5.21 45,000,000(c) 44,757,188
09-10-07 5.22 17,100,000(c) 17,000,250
10-10-07 5.30 32,000,000(c) 31,673,333
Grampian Funding LLC
08-23-07 5.13 9,700,000(c) 9,668,731
11-16-07 5.28 35,000,000(c) 34,461,136
Jupiter Securitization LLC
08-07-07 4.61 41,200,000(c) 41,163,607
08-13-07 4.97 16,000,000(c) 15,971,733
K2 (USA) LLC
04-21-08 5.27 45,000,000 45,000,000
Kitty Hawk Funding
08-30-07 5.22 47,210,000(c) 47,008,440
09-17-07 5.25 22,000,000(c) 21,849,065
Nelnet Student Asset Funding LLC
08-23-07 5.17 19,000,000 18,938,345
08-29-07 5.22 40,000,000 39,834,800
09-13-07 5.28 30,000,000 29,810,263
09-17-07 5.32 19,800,000 19,662,478
Park Avenue Receivables
08-22-07 5.10 45,000,000 44,862,188
</Table>
<Table>
<Caption>
COMMERCIAL PAPER (CONTINUED)
AMOUNT
EFFECTIVE PAYABLE AT
ISSUER YIELD MATURITY VALUE(A)
ASSET-BACKED (CONT.)
Park Granada LLC
08-14-07 4.98% $41,600,000(c) $ 41,520,683
08-14-07 5.00 24,057,000(c) 24,010,957
08-31-07 5.20 36,400,000(c) 36,239,840
Park Sienna LLC
08-13-07 5.04 28,800,000(c) 28,748,400
Ranger Funding LLC
08-14-07 4.98 39,980,000(c) 39,903,771
08-21-07 5.10 35,000,000(c) 34,897,625
08-24-07 5.14 5,300,000(c) 5,282,155
09-18-07 5.26 50,000,000(c) 49,649,667
Scaldis Capital LLC
08-27-07 5.16 22,764,000(c) 22,677,358
09-11-07 5.23 17,400,000(c) 17,295,963
09-28-07 5.29 15,000,000(c) 14,872,883
Sigma Finance
04-18-08 5.27 45,000,000 45,000,000
04-23-08 5.30 60,000,000 60,000,000
06-06-08 5.33 40,000,000 39,998,306
Solitaire Funding LLC
08-17-07 5.05 3,000,000(c) 2,992,967
09-04-07 5.19 40,000,000(c) 39,801,856
10-25-07 5.33 40,000,000(c) 39,503,694
11-28-07 5.31 36,900,000(c) 36,266,950
Thames Asset Global Securities #1
08-28-07 5.13 3,650,000(c) 3,635,683
09-20-07 5.28 19,000,000(c) 18,860,931
Thunder Bay Funding LLC
08-24-07 5.15 40,000,000(c) 39,865,067
Variable Funding Capital
09-05-07 5.20 18,500,000(c) 18,405,573
Whistlejacket Capital LLC
09-26-07 5.31 32,555,000 32,287,109
11-29-07 5.32 32,000,000 31,445,333
White Pine Finance LLC
09-12-07 5.26 35,000,000 34,784,400
10-22-07 5.25 18,000,000 17,787,620
---------------
Total 3,100,438,232
- -----------------------------------------------------------------------------------
</Table>
See accompanying notes to investments in securities.
- --------------------------------------------------------------------------------
RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT 13
<Table>
<Caption>
COMMERCIAL PAPER (CONTINUED)
AMOUNT
EFFECTIVE PAYABLE AT
ISSUER YIELD MATURITY VALUE(A)
BANKING (3.2%)
Bank of America
08-10-07 4.77% $17,000,000 $16,977,794
10-09-07 5.30 38,000,000 37,617,989
10-25-07 5.27 21,700,000 21,433,828
UBS Finance (Delaware) LLC
10-12-07 5.31 40,000,000 39,580,000
UBS Stamford
11-28-07 5.21 42,000,000 42,000,000
---------------
Total 157,609,611
- -----------------------------------------------------------------------------------
</Table>
<Table>
<Caption>
COMMERCIAL PAPER (CONTINUED)
AMOUNT
EFFECTIVE PAYABLE AT
ISSUER YIELD MATURITY VALUE(A)
NON CAPTIVE DIVERSIFIED (1.5%)
General Electric Capital
11-26-07 5.30% $35,000,000 $34,410,775
General Electric Capital Services
10-17-07 5.29 41,000,000 40,541,358
---------------
Total 74,952,133
- -----------------------------------------------------------------------------------
TOTAL COMMERCIAL PAPER
(Cost: $3,332,999,976) $3,332,999,976
- -----------------------------------------------------------------------------------
TOTAL INVESTMENTS IN SECURITIES
(Cost: $4,900,079,257)(d) $4,900,079,257
===================================================================================
</Table>
NOTES TO INVESTMENTS IN SECURITIES
(a) Securities are valued by procedures described in Note 1 to the financial
statements.
(b) Interest rate varies either based on a predetermined schedule or to reflect
current market conditions; rate shown is the effective rate on July 31,
2007. The maturity date disclosed represents the final maturity. For
purposes of Rule 2a-7, maturity is the later of the next put or interest
rate reset date.
(c) Commercial paper sold within terms of a private placement memorandum,
exempt from registration under Section 4(2) of the Securities Act of 1933,
as amended, and may be sold only to dealers in that program or other
"accredited investors." This security has been determined to be liquid
under guidelines established by the Fund's Board of Directors. These
securities may be resold in transactions exempt from registration, normally
to qualified institutional buyers. At July 31, 2007, the value of these
securities amounted to $1,567,476,752 or 31.6% of net assets.
(d) Also represents the cost of securities for federal income tax purposes at
July 31, 2007.
HOW TO FIND INFORMATION ABOUT THE FUND'S 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 disclosed in its
annual and semiannual shareholder reports and in its filings on Form N-Q,
can be found at riversource.com/funds.
- --------------------------------------------------------------------------------
14 RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
JULY 31, 2007
<Table>
ASSETS
Investments in securities, at value (Note 1)
(identified cost $4,900,079,257) $4,900,079,257
Cash in bank on demand deposit 16,815,038
Capital shares receivable 50,551,951
Accrued interest receivable 15,313,846
- ----------------------------------------------------------------------------
Total assets 4,982,760,092
- ----------------------------------------------------------------------------
LIABILITIES
Dividends payable to shareholders 3,805,277
Capital shares payable 24,098,414
Accrued investment management services fee 38,447
Accrued distribution fee 14,635
Accrued transfer agency fee 19,563
Accrued administrative services fee 6,424
Accrued plan administration services fee 179
Other accrued expenses 400,096
- ----------------------------------------------------------------------------
Total liabilities 28,383,035
- ----------------------------------------------------------------------------
Net assets applicable to outstanding capital stock $4,954,377,057
============================================================================
REPRESENTED BY
Capital stock -- $.01 par value (Note 1) $ 49,544,496
Additional paid-in capital 4,904,828,489
Accumulated net realized gain (loss) (Note 5) 4,072
- ----------------------------------------------------------------------------
Total -- representing net assets applicable to outstanding
capital stock $4,954,377,057
============================================================================
</Table>
<Table>
Net assets applicable to outstanding
shares: Class A $4,662,135,661
Class B $ 75,691,552
Class C $ 3,601,400
Class I $ 49,244,173
Class R5 $ 4,999
Class W $ 120,154,895
Class Y $ 43,544,377
Net asset value per share of outstanding
capital stock: Class A shares 4,661,926,326 $ 1.00
Class B shares 75,887,752 $ 1.00
Class C shares 3,602,252 $ 1.00
Class I shares 49,241,684 $ 1.00
Class R5 shares 5,000 $ 1.00
Class W shares 120,156,352 $ 1.00
Class Y shares 43,630,241 $ 1.00
- --------------------------------------------------------------------------------------------
</Table>
See accompanying notes to financial statements.
- --------------------------------------------------------------------------------
RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT 15
STATEMENT OF OPERATIONS
YEAR ENDED JULY 31, 2007
<Table>
INVESTMENT INCOME
Income:
Interest $235,153,052
- --------------------------------------------------------------------------
Expenses (Note 2):
Investment management services fee 12,713,351
Distribution fee
Class A 4,173,165
Class B 726,794
Class C 20,932
Class W 20,714
Transfer agency fee
Class A 9,102,955
Class B 222,192
Class C 6,306
Class R5 2
Class W 41,428
Class Y 81,421
Administrative services fees and expenses 2,141,669
Plan administration services fee -- Class Y 53,626
Compensation of board members 78,071
Custodian fees 329,842
Printing and postage 892,600
Registration fees 587,800
Professional fees 90,880
Other 107,306
- --------------------------------------------------------------------------
Total expenses 31,391,054
Earnings and bank fee credits on cash balances (Note 2) (1,227,437)
- --------------------------------------------------------------------------
Total net expenses 30,163,617
- --------------------------------------------------------------------------
Investment income (loss) -- net 204,989,435
- --------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) -- NET
Net realized gain (loss) on security transactions (Note 3) 4,073
- --------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from
operations $204,993,508
==========================================================================
</Table>
See accompanying notes to financial statements.
- --------------------------------------------------------------------------------
16 RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT
STATEMENTS OF CHANGES IN NET ASSETS
<Table>
<Caption>
YEAR ENDED JULY 31, 2007 2006
OPERATIONS AND DISTRIBUTIONS
Investment income (loss) -- net $ 204,989,435 $ 128,901,741
Net realized gain (loss) on investments 4,073 --
Reimbursement from affiliate -- 2,228,011
- ----------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from
operations 204,993,508 131,129,752
- ----------------------------------------------------------------------------------------
Distributions to shareholders from:
Net investment income
Class A (195,775,646) (120,543,466)
Class B (3,904,861) (3,346,291)
Class C (112,970) (67,050)
Class I (2,824,863) (1,312,882)
Class R5 (156) N/A
Class W (926,030) N/A
Class Y (3,214,417) (4,098,348)
- ----------------------------------------------------------------------------------------
Total distributions (206,758,943) (129,368,037)
- ----------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS AT CONSTANT $1 NET ASSET VALUE
Proceeds from sales
Class A shares (Note 2) 6,798,412,383 5,730,467,995
Class B shares 139,418,982 192,945,487
Class C shares 5,923,860 5,371,287
Class I shares 55,056,992 79,544,919
Class R5 shares 20,831,219 N/A
Class W shares 5,000 N/A
Class Y shares 140,775,465 34,687,539
Reinvestment of distributions at net asset value
Class A shares 189,464,296 115,652,944
Class B shares 3,701,794 3,099,540
Class C shares 104,891 61,435
Class I shares 2,820,353 1,268,943
Class W shares 839,625 N/A
Class Y shares 3,235,937 4,049,831
Payments for redemptions
Class A shares (6,016,286,218) (5,209,174,714)
Class B shares (Note 2) (170,355,522) (222,366,108)
Class C shares (Note 2) (4,931,190) (5,098,008)
Class I shares (71,939,753) (29,609,173)
Class W shares (64,180,397) N/A
Class Y shares (21,458,738) (94,609,608)
- ----------------------------------------------------------------------------------------
Increase (decrease) in net assets from capital share
transactions 1,011,438,979 606,292,309
- ----------------------------------------------------------------------------------------
Total increase (decrease) in net assets 1,009,673,544 608,054,024
Net assets at beginning of year 3,944,703,513 3,336,649,489
- ----------------------------------------------------------------------------------------
Net assets at end of year $ 4,954,377,057 $ 3,944,703,513
========================================================================================
Undistributed net investment income $ -- $ 1,769,508
- ----------------------------------------------------------------------------------------
</Table>
See accompanying notes to financial statements.
- --------------------------------------------------------------------------------
RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT 17
NOTES TO FINANCIAL STATEMENTS
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Fund is a series of RiverSource Money Market Series, Inc. and is registered
under the Investment Company Act of 1940 (as amended) (the 1940 Act) as a
diversified, open-end management investment company. RiverSource Money Market
Series, Inc. has 10 billion authorized shares of capital stock that can be
allocated among the separate series as designated by the Board. The Fund invests
primarily in money market instruments.
The Fund offers Class A, Class B, Class C, Class I and Class Y shares.
- - Class A shares have no sales charge.
- - Class B shares may be subject to a contingent deferred sales charge (CDSC)
and automatically convert to Class A shares during the ninth year of
ownership.
- - Class C shares may be subject to a CDSC.
- - Class I and Class Y shares have no sales charge and are offered only to
qualifying institutional investors.
At July 31, 2007, Ameriprise Financial, Inc. (Ameriprise Financial), the parent
company of RiverSource Investments, LLC (the Investment Manager) and the
affiliated funds-of-funds owned 100% of Class I shares.
Effective Dec. 11, 2006, the Fund offers an additional class of shares, Class
R5, to certain institutional investors. Class R5 shares are sold without a
front-end sales charge or CDSC. At July 31, 2007, Ameriprise Financial owned
100% of Class R5 shares.
Effective Dec. 1, 2006, the Fund offers an additional class of shares, Class W,
through qualifying discretionary accounts. Class W shares are sold without a
front-end sales charge or CDSC.
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 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.
The Fund's significant accounting policies are summarized below:
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.
- --------------------------------------------------------------------------------
18 RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT
VALUATION OF SECURITIES
Pursuant to Rule 2a-7 of the 1940 Act, all securities are valued daily at
amortized cost, which approximates market value, in order to maintain a constant
net asset value of $1 per share.
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 to shareholders. No provision for income or excise
taxes is thus required.
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 JULY 31, 2007 2006
- ----------------------------------------------------------------------------
CLASS A
Distributions paid from:
Ordinary income....................... $195,775,646 $120,543,466
Long-term capital gain................ -- --
CLASS B
Distributions paid from:
Ordinary income....................... 3,904,861 3,346,291
Long-term capital gain................ -- --
CLASS C
Distributions paid from:
Ordinary income....................... 112,970 67,050
Long-term capital gain................ -- --
</Table>
- --------------------------------------------------------------------------------
RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT 19
<Table>
<Caption>
YEAR ENDED JULY 31, 2007 2006
- ----------------------------------------------------------------------------
CLASS I
Distributions paid from:
Ordinary income....................... $ 2,824,863 $ 1,312,882
Long-term capital gain................ -- --
CLASS R5*
Distributions paid from:
Ordinary income....................... 156 N/A
Long-term capital gain................ -- N/A
CLASS W**
Distributions paid from:
Ordinary income....................... 926,030 N/A
Long-term capital gain................ -- N/A
CLASS Y
Distributions paid from:
Ordinary income....................... 3,214,417 4,098,348
Long-term capital gain................ -- --
</Table>
* For the period from Dec. 11, 2006 (inception date) to July 31, 2007.
** For the period from Dec. 1, 2006 (inception date) to July 31, 2007.
At July 31, 2007, the components of distributable earnings on a tax basis are as
follows:
<Table>
Undistributed ordinary income............................... $3,806,137
Undistributed accumulated long-term gain.................... $ 9,766
Accumulated realized loss................................... $ (6,554)
Unrealized appreciation (depreciation)...................... $ --
</Table>
RECENT ACCOUNTING PRONOUNCEMENTS
On Sept. 20, 2006, the Financial Accounting Standards Board (FASB) released
Statement of Financial Accounting Standards No. 157 "Fair Value Measurements"
(SFAS 157). SFAS 157 establishes an authoritative definition of fair value, sets
out a framework for measuring fair value, and requires additional disclosures
about fair-value measurements. The application of SFAS 157 is required for
fiscal years beginning after Nov. 15, 2007 and interim periods within those
fiscal years. The impact of SFAS 157 on the Fund's financial statements is being
evaluated.
In June 2006, the FASB issued FASB Interpretation 48 (FIN 48), "Accounting for
Uncertainty in Income Taxes." FIN 48 clarifies the accounting for uncertainty in
income taxes recognized in accordance with FASB Statement 109, "Accounting for
Income Taxes." FIN 48 prescribes a two-step process to recognize and measure a
tax position taken or expected to be taken in a tax return. The first step is to
determine whether a tax position has met the more-likely-than-not recognition
threshold and the second step is to measure a tax position that meets the
threshold to determine the amount of benefit to recognize. FIN 48 also provides
guidance on derecognition, classification, interest and penalties, accounting in
interim periods,
- --------------------------------------------------------------------------------
20 RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT
disclosure, and transition. FIN 48 is effective for fiscal years beginning after
Dec. 15, 2006. Tax positions of the Fund are being evaluated to determine the
impact, if any, to the Fund. The adoption of FIN 48 is not anticipated to have a
material impact on the Fund.
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.
2. EXPENSES AND SALES CHARGES
Under an Investment Management Services Agreement, the Investment Manager
determines which securities will be purchased, held or sold. The management fee
is a percentage of the Fund's average daily net assets that declines from 0.33%
to 0.15% annually as the Fund's assets increase. The management fee for the year
ended July 31, 2007 was 0.29% of the Fund's average daily net assets.
Under an Administrative Services Agreement, the Fund pays Ameriprise Financial a
fee for administration and accounting services at a percentage of the Fund's
average daily net assets that declines from 0.06% to 0.03% annually as the
Fund's assets increase.
Other expenses in the amount of $44,873 are for, among other things, certain
expenses of the Fund or 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.
Compensation of Board members includes, for a former Board Chair, compensation
as well as retirement benefits. Certain other aspects of a former Board Chair's
compensation, including health benefits and payment of certain other expenses,
are included under other expenses.
Under a Deferred Compensation Plan (the Plan), non-interested board members 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
RiverSource funds. The Fund's liability for these amounts is adjusted for market
value changes and remains in the Fund until distributed in accordance with the
Plan.
Professional fees included fees paid by the Fund for legal services and
independent registered public accounting firm services.
- --------------------------------------------------------------------------------
RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT 21
Under a Transfer Agency Agreement, RiverSource Service Corporation (the Transfer
Agent) maintains shareholder accounts and records. The Fund pays the Transfer
Agent an annual fee per shareholder account for this service as follows:
- - Class A $22.00
- - Class B $23.00
- - Class C $22.50
Effective Dec. 11, 2006, the fee structure under the Transfer Agency Agreement
was revised from an account-based fee to an asset-based fee for Class Y. The
Fund pays the Transfer Agent an annual asset-based fee at a rate of 0.05% of the
Fund's average daily net assets attributable to Class Y shares. Prior to Dec.
11, 2006, the Fund paid the Transfer Agent an annual account-based fee of $20.00
per shareholder account.
In addition, the Fund pays the Transfer Agent an annual asset-based fee at a
rate of 0.05% and 0.20% of the Fund's average daily net assets attributable to
Class R5 and Class W shares, respectively.
Prior to Dec. 11, 2006, Class I paid a transfer agency fee at an annual rate per
shareholder account of $1. Effective Dec. 11, 2006, this fee was eliminated.
The Transfer Agent charges an annual fee of $5 per inactive account, charged on
a pro rata basis for 12 months from the date the account becomes inactive. These
fees are included in the transfer agency fees on the statement of operations.
The Fund has agreements with Ameriprise Financial Services, Inc. and RiverSource
Distributors, Inc. (collectively, 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 0.10% of the Fund's
average daily net assets attributable to Class A and Class W shares and a fee at
an annual rate of up to 0.85% and 0.75% of the Fund's average daily net assets
attributable to Class B and Class C shares, respectively. At July 31, 2007, the
Fund paid an annual rate of 0.75% of the Fund's average daily net assets
attributable to Class B and Class C shares.
Effective Dec. 11, 2006, a Plan Administration Services Agreement was adopted
for Class Y. The fee is calculated at a rate of 0.15% of the Fund's average
daily net assets attributable to Class Y shares.
Sales charges received by the Distributor for distributing Fund shares were
$433,336 for Class B and $4,056 for Class C for the year ended July 31, 2007.
The Investment Manager and its affiliates contractually agreed to waive certain
fees and expenses until July 31, 2007, such that net expenses would not exceed
0.73% for Class A, 1.38% for Class B, 1.39% for Class C, 0.53% for Class I,
0.51% for Class R5, 0.76% for Class W and 0.60% for Class Y of the Fund's
average daily net assets. For the year ended July 31, 2007, the waiver was not
- --------------------------------------------------------------------------------
22 RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT
invoked since the Fund's expenses were below the cap amount. Effective Aug. 1,
2007, the Investment Manager and its affiliates have contractually agreed to
waive certain fees and expenses such that net expenses will not exceed 0.69% for
Class A, 1.35% for Class B, 1.35% for Class C, 0.46% for Class I, 0.51% for
Class R5, 0.76% for Class W and 0.64% for Class Y of the Fund's average daily
net assets, until July 31, 2008, unless sooner terminated at the discretion of
the Board.
During the year ended July 31, 2007, the Fund's custodian and transfer agency
fees were reduced by $1,227,437 as a result of earnings and bank fee credits
from overnight cash balances. The Fund also pays custodian fees to Ameriprise
Trust Company, an affiliate of Ameriprise Financial.
3. SECURITIES TRANSACTIONS
Cost of purchases and proceeds from sales of securities aggregated
$20,853,855,083 and $19,877,639,380, respectively, for the year ended July 31,
2007. Realized gains and losses are determined on an identified cost basis.
4. BANK BORROWINGS
The Fund has a revolving credit agreement with a syndicate of banks headed by
JPMorgan Chase Bank, N.A. (JPMCB), whereby the Fund may borrow for the temporary
funding of shareholder redemptions or for other temporary or emergency purposes.
The agreement went into effect Sept. 19, 2006. The Fund must maintain asset
coverage for borrowings of at least 300%. The agreement, which enables the Fund
to participate with other RiverSource funds, permits borrowings up to $500
million, collectively. Interest is charged to each Fund based on its borrowings
at a rate equal to either the higher of the Federal Funds Effective Rate plus
0.40% or the JPMCB Prime Commercial Lending Rate. Borrowings are payable within
60 days after such loan is executed. The Fund also pays a commitment fee equal
to its pro rata share of the amount of the credit facility at a rate of 0.06%
per annum. Prior to this agreement, the Fund paid a commitment fee equal to its
pro rata share of the amount of the credit facility at a rate of 0.07% per
annum. The Fund had no borrowings under the facility outstanding during the year
ended July 31, 2007.
5. POST-OCTOBER LOSS
For federal income tax purposes, the Fund had a post-October loss of $6,554 at
July 31, 2007.
- --------------------------------------------------------------------------------
RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT 23
6. 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 mutual funds and
they purport to bring the action derivatively on 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. In response to defendants' motion to dismiss the
complaint, the 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 may file a notice of appeal with the Eighth Circuit Court of Appeals
within 30 days from the date of judgment.
In December 2005, without admitting or denying the allegations, American Express
Financial Corporation (AEFC, which is now known as Ameriprise Financial, Inc.
(Ameriprise Financial)), the parent company of RiverSource Investments, LLC
(RiverSource Investments), entered into settlement agreements with the
Securities and Exchange Commission (SEC) and Minnesota Department of Commerce
(MDOC) related to market timing activities. In connection with these matters,
the SEC and MDOC issued orders (the Orders) alleging that AEFC violated certain
provisions of the federal and Minnesota securities laws by failing to adequately
disclose market timing activities by allowing certain identified market timers
to continue to market time contrary to disclosures in mutual fund and variable
annuity product prospectuses. The Orders also alleged that AEFC failed to
implement procedures to detect and prevent market timing in 401(k) plans for
employees of AEFC and related companies and failed to adequately disclose that
there were no such procedures. Pursuant to the MDOC Order, the MDOC also alleged
that AEFC allowed inappropriate market timing to occur by failing to have
written policies and procedures and failing to properly supervise its employees.
As a result of the Orders, 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. Pursuant to the terms of the Orders, AEFC agreed to pay
disgorgement of $10 million and civil money penalties of $7 million. AEFC also
agreed to make presentations at least annually to its board of directors and the
relevant mutual funds' board that include an overview of policies and procedures
to prevent market timing, material changes to these policies and procedures and
- --------------------------------------------------------------------------------
24 RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT
whether disclosures related to market timing are consistent with the SEC order
and federal securities laws. 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. In
addition, AEFC agreed to complete and submit to the MDOC a compliance review of
its procedures regarding market timing within one year of the MDOC Order,
including a summary of actions taken to ensure compliance with applicable laws
and regulations and certification by a senior officer regarding compliance and
supervisory procedures.
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.
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 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.
- --------------------------------------------------------------------------------
RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT 25
7. FINANCIAL HIGHLIGHTS
The tables below show certain important financial information for evaluating the
Fund's results.
CLASS A
<Table>
<Caption>
PER SHARE INCOME AND CAPITAL CHANGES(a)
FISCAL PERIOD ENDED JULY 31, 2007 2006 2005 2004 2003
Net asset value, beginning of period $1.00 $1.00 $1.00 $1.00 $1.00
- -----------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) .05(b) .04 .02 -- .01
- -----------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends from net investment income (.05) (.04) (.02) -- (.01)
- -----------------------------------------------------------------------------------------------------------
Net asset value, end of period $1.00 $1.00 $1.00 $1.00 $1.00
- -----------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
millions) $4,662 $3,692 $3,054 $3,680 $4,649
- -----------------------------------------------------------------------------------------------------------
Ratio of expenses to average daily
net assets(c) .70% .75%(d) .80% .78% .69%
- -----------------------------------------------------------------------------------------------------------
Ratio of net investment income (loss)
to average daily net assets 4.65% 3.75% 1.58% .35% .78%
- -----------------------------------------------------------------------------------------------------------
Total return(e) 4.80% 3.82%(f) 1.63% .35% .77%
- -----------------------------------------------------------------------------------------------------------
</Table>
(a) For a share outstanding throughout the period. Rounded to the nearest cent.
(b) Per share amounts have been calculated using average shares outstanding
method.
(c) Expense ratio is based on total expenses of the Fund before reduction of
earnings and bank fee credits on cash balances.
(d) The Investment Manager and its affiliates waived/reimbursed the Fund for
certain expenses. Had they not done so, the annual ratio of expenses for
Class A would have been 0.83% for the year ended July 31, 2006.
(e) Total return does not reflect payment of a sales charge.
(f) The Fund received a one time payment by Ameriprise Financial for additional
earnings from overnight cash balances determined to be owed for prior
years. Had the Fund not received this payment, the total return would have
been lower by 0.06%.
- --------------------------------------------------------------------------------
26 RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT
CLASS B
<Table>
<Caption>
PER SHARE INCOME AND CAPITAL CHANGES(a)
FISCAL PERIOD ENDED JULY 31, 2007 2006 2005 2004 2003
Net asset value, beginning of
period $1.00 $1.00 $1.00 $1.00 $1.00
- ------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT
OPERATIONS:
Net investment income (loss) .04(b) .03 .01 -- --
- ------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends from net investment
income (.04) (.03) (.01) -- --
- ------------------------------------------------------------------------------------------------------
Net asset value, end of
period $1.00 $1.00 $1.00 $1.00 $1.00
- ------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
millions) $76 $103 $129 $180 $278
- ------------------------------------------------------------------------------------------------------
Ratio of expenses to average
daily net assets(c) 1.36% 1.40%(d) 1.44%(d) 1.07%(d) 1.26%(d)
- ------------------------------------------------------------------------------------------------------
Ratio of net investment
income (loss) to average
daily net assets 3.98% 3.05% .91% .05% .21%
- ------------------------------------------------------------------------------------------------------
Total return(e) 4.11% 3.14%(f) .98% .06% .20%
- ------------------------------------------------------------------------------------------------------
</Table>
(a) For a share outstanding throughout the period. Rounded to the nearest cent.
(b) Per share amounts have been calculated using average shares outstanding
method.
(c) Expense ratio is based on total expenses of the Fund before reduction of
earnings and bank fee credits on cash balances.
(d) The Investment Manager and its affiliates waived/reimbursed the Fund for
certain expenses. Had they not done so, the annual ratios of expenses for
Class B would have been 1.49%, 1.45%, 1.43% and 1.38% for the years ended
July 31, 2006, 2005, 2004 and 2003, respectively.
(e) Total return does not reflect payment of a sales charge.
(f) The Fund received a one time payment by Ameriprise Financial for additional
earnings from overnight cash balances determined to be owed for prior
years. Had the Fund not received this payment, the total return would have
been lower by 0.06%.
- --------------------------------------------------------------------------------
RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT 27
CLASS C
<Table>
<Caption>
PER SHARE INCOME AND CAPITAL CHANGES(a)
FISCAL PERIOD ENDED JULY 31, 2007 2006 2005 2004 2003
Net asset value, beginning of period $1.00 $1.00 $1.00 $1.00 $1.00
- -----------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) .04(b) .03 .01 -- --
- -----------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends from net investment income (.04) (.03) (.01) -- --
- -----------------------------------------------------------------------------------------------------------
Net asset value, end of period $1.00 $1.00 $1.00 $1.00 $1.00
- -----------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
millions) $4 $3 $2 $3 $4
- -----------------------------------------------------------------------------------------------------------
Ratio of expenses to average daily
net assets(c) 1.36% 1.41%(d) 1.44%(d) 1.07%(d) 1.27%(d)
- -----------------------------------------------------------------------------------------------------------
Ratio of net investment income (loss)
to average daily net assets 4.00% 3.05% .91% .06% .21%
- -----------------------------------------------------------------------------------------------------------
Total return(e) 4.12% 3.14%(f) .98% .06% .20%
- -----------------------------------------------------------------------------------------------------------
</Table>
(a) For a share outstanding throughout the period. Rounded to the nearest cent.
(b) Per share amounts have been calculated using average shares outstanding
method.
(c) Expense ratio is based on total expenses of the Fund before reduction of
earnings and bank fee credits on cash balances.
(d) The Investment Manager and its affiliates waived/reimbursed the Fund for
certain expenses. Had they not done so, the annual ratios of expenses for
Class C would have been 1.49%, 1.45%, 1.43% and 1.38% for the years ended
July 31, 2006, 2005, 2004 and 2003, respectively.
(e) Total return does not reflect payment of a sales charge.
(f) The Fund received a one time payment by Ameriprise Financial for additional
earnings from overnight cash balances determined to be owed for prior
years. Had the Fund not received this payment, the total return would have
been lower by 0.06%.
- --------------------------------------------------------------------------------
28 RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT
CLASS I
<Table>
<Caption>
PER SHARE INCOME AND CAPITAL CHANGES(a)
FISCAL PERIOD ENDED JULY 31, 2007 2006 2005 2004(B)
Net asset value, beginning of period $1.00 $1.00 $1.00 $1.00
- -----------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) .05(c) .04 .02 --
- -----------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends from net investment income (.05) (.04) (.02) --
- -----------------------------------------------------------------------------------------------------------
Net asset value, end of period $1.00 $1.00 $1.00 $1.00
- -----------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
millions) $49 $63 $12 $4
- -----------------------------------------------------------------------------------------------------------
Ratio of expenses to average daily
net assets(d) .38% .42% .39% .43%(e)
- -----------------------------------------------------------------------------------------------------------
Ratio of net investment income (loss)
to average daily net assets 4.97% 4.42% 2.21% .77%(e)
- -----------------------------------------------------------------------------------------------------------
Total return(f) 5.14% 4.16%(g) 2.04% .30%(h)
- -----------------------------------------------------------------------------------------------------------
</Table>
(a) For a share outstanding throughout the period. Rounded to the nearest cent.
(b) For the period from March 4, 2004 (inception date) to July 31, 2004.
(c) Per share amounts have been calculated using average shares outstanding
method.
(d) Expense ratio is based on total expenses of the Fund before reduction of
earnings and bank fee credits on cash balances.
(e) Adjusted to an annual basis.
(f) Total return does not reflect payment of a sales charge.
(g) The Fund received a one time payment by Ameriprise Financial for additional
earnings from overnight cash balances determined to be owed for prior
years. Had the Fund not received this payment, the total return would have
been lower by 0.06%.
(h) Not annualized.
- --------------------------------------------------------------------------------
RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT 29
CLASS R5
<Table>
<Caption>
PER SHARE INCOME AND CAPITAL CHANGES(a)
FISCAL PERIOD ENDED JULY 31, 2007(B)
Net asset value, beginning of period $1.00
- -----------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) .03(c)
- -----------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends from net investment income (.03)
- -----------------------------------------------------------------------------------------------------------
Net asset value, end of period $1.00
- -----------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
millions) $--
- -----------------------------------------------------------------------------------------------------------
Ratio of expenses to average daily
net assets(d) .44%(e)
- -----------------------------------------------------------------------------------------------------------
Ratio of net investment income (loss)
to average daily net assets 4.90%(e)
- -----------------------------------------------------------------------------------------------------------
Total return(f) 3.20%(g)
- -----------------------------------------------------------------------------------------------------------
</Table>
(a) For a share outstanding throughout the period. Rounded to the nearest cent.
(b) From the period from Dec. 11, 2006 (inception date) to July 31, 2007.
(c) Per share amounts have been calculated using average shares outstanding
method.
(d) Expense ratio is based on total expenses of the Fund before reduction of
earnings and bank fee credits on cash balances.
(e) Adjusted to an annual basis.
(f) Total return does not reflect payment of a sales charge.
(g) Not annualized.
- --------------------------------------------------------------------------------
30 RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT
CLASS W
<Table>
<Caption>
PER SHARE INCOME AND CAPITAL CHANGES(a)
FISCAL PERIOD ENDED JULY 31, 2007(B)
Net asset value, beginning of period $1.00
- -----------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) .03(c)
- -----------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends from net investment income (.03)
- -----------------------------------------------------------------------------------------------------------
Net asset value, end of period $1.00
- -----------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
millions) $120
- -----------------------------------------------------------------------------------------------------------
Ratio of expenses to average daily
net assets(d) .65%(e)
- -----------------------------------------------------------------------------------------------------------
Ratio of net investment income (loss)
to average daily net assets 4.46%(e)
- -----------------------------------------------------------------------------------------------------------
Total return(f) 3.13%(g)
- -----------------------------------------------------------------------------------------------------------
</Table>
(a) For a share outstanding throughout the period. Rounded to the nearest cent.
(b) From the period from Dec. 1, 2006 (inception date) to July 31, 2007.
(c) Per share amounts have been calculated using average shares outstanding
method.
(d) Expense ratio is based on total expenses of the Fund before reduction of
earnings and bank fee credits on cash balances.
(e) Adjusted to an annual basis.
(f) Total return does not reflect payment of a sales charge.
(g) Not annualized.
- --------------------------------------------------------------------------------
RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT 31
CLASS Y
<Table>
<Caption>
PER SHARE INCOME AND CAPITAL CHANGES(a)
FISCAL PERIOD ENDED JULY 31, 2007 2006 2005 2004 2003
Net asset value, beginning of period $1.00 $1.00 $1.00 $1.00 $1.00
- ---------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) .05(b) .04 .02 -- .01
- ---------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends from net investment income (.05) (.04) (.02) -- (.01)
- ---------------------------------------------------------------------------------------------------------------
Net asset value, end of period $1.00 $1.00 $1.00 $1.00 $1.00
- ---------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in millions) $44 $84 $140 $209 $262
- ---------------------------------------------------------------------------------------------------------------
Ratio of expenses to average daily net
assets(c) .59% .62%(d) .66% .65% .62%
- ---------------------------------------------------------------------------------------------------------------
Ratio of net investment income (loss) to
average daily net assets 4.75% 3.78% 1.55% .47% .82%
- ---------------------------------------------------------------------------------------------------------------
Total return(e) 4.92% 3.95%(f) 1.76% .48% .85%
- ---------------------------------------------------------------------------------------------------------------
</Table>
(a) For a share outstanding throughout the period. Rounded to the nearest cent.
(b) Per share amounts have been calculated using average shares outstanding
method.
(c) Expense ratio is based on total expenses of the Fund before reduction of
earnings and bank fee credits on cash balances.
(d) The Investment Manager and its affiliates waived/reimbursed the Fund for
certain expenses. Had they not done so, the annual ratio of expenses for
Class Y would have been 0.68% for the year ended July 31, 2006.
(e) Total return does not reflect payment of a sales charge.
(f) The Fund received a one time payment by Ameriprise Financial for additional
earnings from overnight cash balances determined to be owed for prior
years. Had the Fund not received this payment, the total return would have
been lower by 0.06%.
- --------------------------------------------------------------------------------
32 RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
TO THE BOARD OF DIRECTORS AND SHAREHOLDERS OF RIVERSOURCE CASH MANAGEMENT FUND:
We have audited the accompanying statement of assets and liabilities, including
the schedule of investments in securities, of RiverSource Cash Management Fund
(the Fund), as of July 31, 2007, and the related statement of operations,
statement of changes in net assets and 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 financial statements and financial highlights of the Fund for the
periods presented through July 31, 2006, were audited by other auditors whose
report dated September 20, 2006, 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 July 31, 2007, 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.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of
RiverSource Cash Management Fund at July 31, 2007, 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.
Ernst & Young LLP
Minneapolis, Minnesota
September 20, 2007
- --------------------------------------------------------------------------------
RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT 33
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 July 31, 2007
CLASS A
<Table>
<Caption>
INCOME DISTRIBUTIONS - taxable as dividend income:
Qualified Dividend Income for individuals............. 0.00%
Dividends Received Deduction for corporations......... 0.00%
</Table>
<Table>
<Caption>
PAYABLE DATE PER SHARE
Aug. 28, 2006............................................... $0.00433
Sept. 25, 2006.............................................. 0.00368
Oct. 26, 2006............................................... 0.00403
Nov. 27, 2006............................................... 0.00410
Dec. 27, 2006............................................... 0.00375
Jan. 23, 2007............................................... 0.00338
Feb. 23, 2007............................................... 0.00401
March 26, 2007.............................................. 0.00402
April 25, 2007.............................................. 0.00386
May 25, 2007................................................ 0.00387
June 25, 2007............................................... 0.00398
July 25, 2007............................................... 0.00389
Total distributions......................................... $0.04690
</Table>
CLASS B
<Table>
<Caption>
INCOME DISTRIBUTIONS - taxable as dividend income:
Qualified Dividend Income for individuals............. 0.00%
Dividends Received Deduction for corporations......... 0.00%
</Table>
<Table>
<Caption>
PAYABLE DATE PER SHARE
Aug. 28, 2006............................................... $0.00374
Sept. 25, 2006.............................................. 0.00317
Oct. 26, 2006............................................... 0.00347
Nov. 27, 2006............................................... 0.00353
Dec. 27, 2006............................................... 0.00320
Jan. 23, 2007............................................... 0.00288
Feb. 23, 2007............................................... 0.00344
March 26, 2007.............................................. 0.00345
April 25, 2007.............................................. 0.00331
May 25, 2007................................................ 0.00332
June 25, 2007............................................... 0.00338
July 25, 2007............................................... 0.00333
Total distributions......................................... $0.04022
</Table>
- --------------------------------------------------------------------------------
34 RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT
CLASS C
<Table>
<Caption>
INCOME DISTRIBUTIONS - taxable as dividend income:
Qualified Dividend Income for individuals............. 0.00%
Dividends Received Deduction for corporations......... 0.00%
</Table>
<Table>
<Caption>
PAYABLE DATE PER SHARE
Aug. 28, 2006............................................... $0.00373
Sept. 25, 2006.............................................. 0.00317
Oct. 26, 2006............................................... 0.00347
Nov. 27, 2006............................................... 0.00353
Dec. 27, 2006............................................... 0.00321
Jan. 23, 2007............................................... 0.00289
Feb. 23, 2007............................................... 0.00345
March 26, 2007.............................................. 0.00347
April 25, 2007.............................................. 0.00332
May 25, 2007................................................ 0.00333
June 25, 2007............................................... 0.00341
July 25, 2007............................................... 0.00335
Total distributions......................................... $0.04033
</Table>
CLASS I
<Table>
<Caption>
INCOME DISTRIBUTIONS - taxable as dividend income:
Qualified Dividend Income for individuals............. 0.00%
Dividends Received Deduction for corporations......... 0.00%
</Table>
<Table>
<Caption>
PAYABLE DATE PER SHARE
Aug. 28, 2006............................................... $0.00463
Sept. 25, 2006.............................................. 0.00391
Oct. 26, 2006............................................... 0.00431
Nov. 27, 2006............................................... 0.00440
Dec. 27, 2006............................................... 0.00401
Jan. 23, 2007............................................... 0.00361
Feb. 23, 2007............................................... 0.00428
March 26, 2007.............................................. 0.00428
April 25, 2007.............................................. 0.00412
May 25, 2007................................................ 0.00412
June 25, 2007............................................... 0.00427
July 25, 2007............................................... 0.00413
Total distributions......................................... $0.05007
</Table>
- --------------------------------------------------------------------------------
RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT 35
CLASS R5
<Table>
<Caption>
INCOME DISTRIBUTIONS - taxable as dividend income:
Qualified Dividend Income for individuals............. 0.00%
Dividends Received Deduction for corporations......... 0.00%
</Table>
<Table>
<Caption>
PAYABLE DATE PER SHARE
Dec. 27, 2006............................................... 0.00200
Jan. 23, 2007............................................... 0.00356
Feb. 23, 2007............................................... 0.00422
March 26, 2007.............................................. 0.00423
April 25, 2007.............................................. 0.00407
May 25, 2007................................................ 0.00408
June 25, 2007............................................... 0.00422
July 25, 2007............................................... 0.00408
Total distributions......................................... $0.03046
</Table>
CLASS W
<Table>
<Caption>
INCOME DISTRIBUTIONS - taxable as dividend income:
Qualified Dividend Income for individuals............. 0.00%
Dividends Received Deduction for corporations......... 0.00%
</Table>
<Table>
<Caption>
PAYABLE DATE PER SHARE
Dec. 27, 2006............................................... 0.00321
Jan. 23, 2007............................................... 0.00337
Feb. 23, 2007............................................... 0.00402
March 26, 2007.............................................. 0.00389
April 25, 2007.............................................. 0.00383
May 25, 2007................................................ 0.00386
June 25, 2007............................................... 0.00400
July 25, 2007............................................... 0.00387
Total distributions......................................... $0.03005
</Table>
- --------------------------------------------------------------------------------
36 RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT
CLASS Y
<Table>
<Caption>
INCOME DISTRIBUTIONS - taxable as dividend income:
Qualified Dividend Income for individuals............. 0.00%
Dividends Received Deduction for corporations......... 0.00%
</Table>
<Table>
<Caption>
PAYABLE DATE PER SHARE
Aug. 28, 2006............................................... $0.00445
Sept. 25, 2006.............................................. 0.00377
Oct. 26, 2006............................................... 0.00414
Nov. 27, 2006............................................... 0.00422
Dec. 27, 2006............................................... 0.00390
Jan. 23, 2007............................................... 0.00346
Feb. 23, 2007............................................... 0.00410
March 26, 2007.............................................. 0.00411
April 25, 2007.............................................. 0.00394
May 25, 2007................................................ 0.00395
June 25, 2007............................................... 0.00405
July 25, 2007............................................... 0.00395
Total distributions......................................... $0.04804
</Table>
- --------------------------------------------------------------------------------
RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT 37
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. Each member oversees 102
RiverSource funds. Board members serve until the next regular shareholders'
meeting or until he or she reaches the mandatory retirement age established by
the Board. Under the current Board policy, members may serve until the end of
the meeting following their 75th birthday, or the fifteenth anniversary of the
first Board meeting they attended as members of the Board, whichever occurs
first. This policy does not apply to Ms. Jones who may retire after her 75th
birthday.
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 Chief Justice, Minnesota Supreme
901 S. Marquette Ave. since 2006 Court, 1998-2005
Minneapolis, MN 55402
Age 53
- -----------------------------------------------------------------------------------------------------
Arne H. Carlson Board member Chair, RiverSource Funds,
901 S. Marquette Ave. since 1999 1999-2006; former Governor of
Minneapolis, MN 55402 Minnesota
Age 73
- -----------------------------------------------------------------------------------------------------
Pamela G. Carlton Board member President, Springboard -- Partners
901 S. Marquette Ave. since 2007 in Cross Cultural Leadership
Minneapolis, MN 55402 (consulting company)
Age 52
- -----------------------------------------------------------------------------------------------------
Patricia M. Flynn Board member Trustee Professor of Economics and
901 S. Marquette Ave. since 2004 Management, Bentley College; former
Minneapolis, MN 55402 Dean, McCallum Graduate School of
Age 56 Business, Bentley College
- -----------------------------------------------------------------------------------------------------
Anne P. Jones Board member Attorney and Consultant
901 S. Marquette Ave. since 1985
Minneapolis, MN 55402
Age 72
- -----------------------------------------------------------------------------------------------------
Jeffrey Laikind, CFA Board member Former Managing Director, Shikiar American Progressive
901 S. Marquette Ave. since 2005 Asset Management Insurance
Minneapolis, MN 55402
Age 71
- -----------------------------------------------------------------------------------------------------
Stephen R. Lewis, Jr. Board member President Emeritus and Professor of Valmont Industries,
901 S. Marquette Ave. since 2002 and Economics, Carleton College Inc. (manufactures
Minneapolis, MN 55402 Chair of the irrigation systems)
Age 68 Board since 2007
- -----------------------------------------------------------------------------------------------------
</Table>
- --------------------------------------------------------------------------------
38 RIVERSOURCE CASH MANAGEMENT FUND -- 2007 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
- -----------------------------------------------------------------------------------------------------
Catherine James Paglia Board member Director, Enterprise Asset Strategic
901 S. Marquette Ave. since 2004 Management, Inc. (private real Distribution, Inc.
Minneapolis, MN 55402 estate and asset management (transportation,
Age 55 company) distribution and
logistics
consultants)
- -----------------------------------------------------------------------------------------------------
Alison Taunton-Rigby Board member Chief Executive Officer, RiboNovix, Hybridon, Inc.
901 S. Marquette Ave. since 2002 Inc. since 2003 (biotechnology); (biotechnology);
Minneapolis, MN 55402 former President, Forester Biotech American Healthways,
Age 63 Inc. (health
management programs)
- -----------------------------------------------------------------------------------------------------
</Table>
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 President -- U.S. Asset Management
53600 Ameriprise since 2001, and Chief Investment Officer,
Financial Center Vice President Ameriprise Financial, Inc. and
Minneapolis, MN 55474 since 2002 President, Chairman of the Board
Age 47 and Chief Investment Officer,
RiverSource Investments, LLC since
2005; President, Ameriprise
Certificate Company since 2006;
Senior Vice President -- Chief
Investment Officer, Ameriprise
Financial, Inc. and Chairman of the
Board and Chief Investment Officer,
RiverSource Investments, LLC,
2001-2005
- -----------------------------------------------------------------------------------------------------
</Table>
* Interested person by reason of being an officer, director, security holder
and/or employee of RiverSource Investments.
The SAI has additional information about the Fund's Board members and is
available, without charge, upon request by calling RiverSource Funds at (888)
791-3380; contacting your financial institution; or visiting
riversource.com/funds.
- --------------------------------------------------------------------------------
RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT 39
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 Senior Vice President -- Asset Management,
172 Ameriprise 2006 RiverSource Investments, LLC since 2006;
Financial Center Managing Director and Global Head of Product,
Minneapolis, MN 55474 Morgan Stanley Investment Management,
Age 41 2004-2006; President, Touchstone Investments,
2002-2004; Director of Strategic Planning,
Evergreen Investments, 1995-2002
- ------------------------------------------------------------------------------------------
Michelle M. Keeley Vice President Executive Vice President -- Equity and Fixed
172 Ameriprise since 2004 Income, Ameriprise Financial, Inc. and
Financial Center RiverSource Investments, LLC since 2006; Vice
Minneapolis, MN 55474 President -- Investments, Ameriprise
Age 43 Certificate Company since 2003; Senior Vice
President -- Fixed Income, Ameriprise
Financial, Inc., 2002-2006 and RiverSource
Investments, LLC, 2004-2006; Managing
Director, Zurich Global Assets, 2001-2002
- ------------------------------------------------------------------------------------------
Amy K. Johnson Vice President Vice President -- Asset Management and Trust
5228 Ameriprise since 2006 Company Services, RiverSource Investments, LLC
Financial Center since 2006; Vice President -- Operations and
Minneapolis, MN 55474 Compliance, RiverSource Investments, LLC,
Age 41 2004-2006; Director of Product
Development -- Mutual Funds, Ameriprise
Financial, Inc., 2001-2004
- ------------------------------------------------------------------------------------------
Jeffrey P. Fox Treasurer since Vice President -- Investment Accounting,
105 Ameriprise 2002 Ameriprise Financial, Inc. since 2002; Vice
Financial Center President -- Finance, American Express
Minneapolis, MN 55474 Company, 2000-2002
Age 52
- ------------------------------------------------------------------------------------------
Scott R. Plummer Vice President, Vice President and Chief Counsel -- Asset
5228 Ameriprise General Counsel Management, Ameriprise Financial, Inc. since
Financial Center and Secretary 2005; Vice President, General Counsel and
Minneapolis, MN 55474 since 2006 Secretary, Ameriprise Certificate Company
Age 47 since 2005; Vice President -- Asset Management
Compliance, Ameriprise Financial, Inc.,
2004-2005; Senior Vice President and Chief
Compliance Officer, U.S. Bancorp Asset
Management, 2002-2004; Second Vice President
and Assistant General Counsel, Hartford Life,
2001-2002
- ------------------------------------------------------------------------------------------
Jennifer D. Lammers Chief Compliance U.S. Asset Management Chief Compliance
172 Ameriprise Officer since Officer, RiverSource Investments, LLC since
Financial Center 2006 2006; Director -- Mutual Funds, Voyageur Asset
Minneapolis, MN 55474 Management, 2003-2006; Director of Finance,
Age 46 Voyageur Asset Management, 2000-2003
- ------------------------------------------------------------------------------------------
</Table>
- --------------------------------------------------------------------------------
40 RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT
FUND OFFICERS (CONTINUED)
<Table>
<Caption>
NAME, POSITION HELD
ADDRESS, WITH FUND AND PRINCIPAL OCCUPATION
AGE LENGTH OF SERVICE DURING PAST FIVE YEARS
- ------------------------------------------------------------------------------------------
Neysa M. Alecu Money Laundering Compliance Director and Anti-Money Laundering
2934 Ameriprise Prevention Officer, Ameriprise Financial, Inc. since
Financial Center Officer since 2004; Manager Anti-Money Laundering,
Minneapolis, MN 55474 2004 Ameriprise Financial, Inc., 2003-2004;
Age 43 Compliance Director and Bank Secrecy Act
Officer, American Express Centurion Bank,
2000-2003
- ------------------------------------------------------------------------------------------
</Table>
- --------------------------------------------------------------------------------
RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT 41
APPROVAL OF INVESTMENT MANAGEMENT SERVICES AGREEMENT
RiverSource Investments, LLC ("RiverSource"), a wholly-owned subsidiary of
Ameriprise Financial, Inc. ("Ameriprise Financial"), serves as the investment
manager to the Fund. Under an investment management services agreement (the "IMS
Agreement") RiverSource provides investment advice and other services to the
Fund and all RiverSource funds (collectively, the "Funds"). The Fund's Board of
Directors (the "Board") and the Board's Investment Review and Contracts
Committees monitor these services throughout the year.
On an annual basis, the Board, including the independent Board members (the
"Independent Directors"), considers renewal of the IMS Agreement. RiverSource
prepares detailed reports for the Board and its Contracts Committee in March and
April, including reports based on data provided by independent organizations to
assist the Board in making this determination. In addition, throughout the year,
the Board (or its committees) reviews information prepared by RiverSource
addressing the services RiverSource provides and Fund performance. The Board
accords particular weight to the work, deliberations and conclusions of the
Contracts and Investment Review Committees in determining whether to continue
the IMS Agreement. At the April 11-12, 2007 in-person Board meeting, independent
legal counsel to the Independent Directors reviewed with the Independent
Directors various factors relevant to the Board's consideration of advisory
agreements and the Board's legal responsibilities related to such consideration.
Following an analysis and discussion of the factors identified below, the Board,
including all of the Independent Directors, approved renewal of the IMS
Agreement.
Nature, Extent and Quality of Services Provided by RiverSource: The Board
analyzed various reports and presentations it had received detailing the
services performed by RiverSource, as well as its expertise, resources and
capabilities. The Board specifically considered many developments during the
past year concerning the services provided by RiverSource, including, in
particular, the growing strength and capabilities of many RiverSource offices
and the increased investment and resources dedicated to the Fund's operations,
particularly in the areas of trading systems, legal and compliance. Further, in
connection with the Board's evaluation of the overall package of services
provided by RiverSource, the Board considered the quality of the administrative,
custody and transfer agency services provided by RiverSource affiliates to the
Fund. The Board also reviewed the financial condition of RiverSource and the
entity's ability to carry out its responsibilities under the IMS Agreement. The
Board also discussed the acceptability of the terms of the IMS Agreement
(including the relatively broad scope of services required to be performed by
RiverSource). The Board concluded that the services being performed under the
IMS Agreement were of a reasonably high quality.
- --------------------------------------------------------------------------------
42 RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT
Based on the foregoing, and based on other information received (both oral and
written, including the information on investment performance referenced below)
and other considerations, the Board determined that RiverSource was in a
position to continue to provide a high quality and level of services to the
Fund.
Investment Performance: For purposes of evaluating the nature, extent and
quality of services provided under the IMS Agreement, the Board carefully
reviewed the investment performance of the Fund. In this regard, the Board
considered: (i) detailed reports containing data prepared by an independent
organization showing, for various periods, the performance of the Fund, the
performance of a benchmark index, the percentage ranking of the Fund among its
comparison group and the net assets of the Fund; and (ii) a report detailing the
Fund's performance over various periods (including since inception), recent Fund
inflows (and outflows) and a comparison of the Fund's net assets from December
2006 to December 2005. The Board observed that the Fund's investment performance
met expectations.
Comparative Fees, Costs of Services Provided and the Profits Realized By
RiverSource and its Affiliates from their Relationships with the Fund: The
Board reviewed comparative fees and the costs of services to be provided under
the IMS Agreement. The Board members considered detailed comparative information
set forth in an annual report on fees and expenses, including, among other
things, data (prepared by an independent organization) showing a comparison of
the Fund's expenses with median expenses paid by funds in its peer group, as
well as data showing the Fund's contribution to RiverSource's profitability. The
Board accorded particular weight to the notion that the level of fees should
reflect a rational pricing model applied consistently across the various product
lines in the Funds' family, while assuring that the overall fees for each fund
are generally in line with the "pricing philosophy" (i.e., that the total
expense ratio of each fund, with few exceptions, is at or below the median
expense ratio of funds in the same comparison group). Although the Fund's
expense ratio was higher than the median ratio, the Board was satisfied with the
consistent and rational fee schedule applicable to all Funds, including the
Fund. Based on its review, the Board concluded that the Fund's management fee
was fair and reasonable in light of the extent and quality of services that the
Fund receives.
The Board also considered the expected profitability of RiverSource and its
affiliates in connection with RiverSource providing investment management
services to the Fund. In this regard, the Board referred to a detailed
profitability report, discussing the profitability to RiverSource and Ameriprise
Financial from managing and operating the Fund, including data showing
comparative profitability. The Board also considered the services acquired by
the investment manager through the use of commission dollars paid by the Funds
on portfolio transactions. The Board noted that the fees paid by the Fund should
permit the investment manager to offer competitive compensation to its
personnel, make
- --------------------------------------------------------------------------------
RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT 43
necessary investments in its business and earn an appropriate profit. The Board
concluded that profitability levels were reasonable.
Economies of Scale to be Realized: The Board also considered the economies of
scale that might be realized by RiverSource as the Fund grows and took note of
the extent to which Fund shareholders might also benefit from such growth. The
Board considered that the IMS Agreement provides for lower fees as assets
increase at pre-established breakpoints and concluded that the IMS Agreement
satisfactorily provided for sharing these economies of scale.
Based on the foregoing, the Board, including all of the Independent Directors,
concluded that the investment management service fees were fair and reasonable
in light of the extent and quality of services provided. In reaching this
conclusion, no single factor was determinative. On April 12, 2007, the Board,
including all of the Independent Directors, approved the renewal of the IMS
Agreement.
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 RiverSource Funds at (888) 791-3380; contacting your financial
institution; 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.
CHANGE IN INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
On April 12, 2007, Ernst & Young LLP was selected as the Fund's independent
registered public accounting firm for the 2007 fiscal year. A majority of the
Fund's Board of Directors, including a majority of the Independent Directors,
approved the appointment of Ernst & Young LLP. The predecessor independent
registered public accounting firm's reports on the Fund's financial statements
for the year ended July 31, 2006 and the year ended July 31, 2005 contained no
adverse opinion or disclaimer of opinion and were not qualified or modified as
to uncertainty, audit scope or accounting principles. During such fiscal periods
and through April 12, 2007 there were no disagreements between the Fund and the
predecessor independent registered public accounting firm on any matter of
accounting principles or practices, financial statement disclosure, or auditing
scope
- --------------------------------------------------------------------------------
44 RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT
or procedures, which such disagreements, if not resolved to the satisfaction of
the predecessor independent registered public accounting firm, would have caused
them to make reference to the subject matter of the disagreement in connection
with their reports on the financial statements for such fiscal periods.
- --------------------------------------------------------------------------------
RIVERSOURCE CASH MANAGEMENT FUND -- 2007 ANNUAL REPORT 45
RIVERSOURCE(R)CASH MANAGEMENT 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
Distributors, Inc. and Ameriprise Financial
Services, Inc., Members FINRA, and managed by
RiverSource Investments, LLC. These companies
(RIVERSOURCE INVESTMENTS LOGO) are part of Ameriprise Financial, Inc. S-6320 AE (9/07)
</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 Jeffrey Laikind and Anne P. Jones, each qualify as audit
committee financial experts.
Item 4. Principal Accountant Fees and Services
Fund - Related Fees
(a) Audit Fees. The fees for the year ended July 31, to Ernst & Young LLP for
professional services rendered for the audits of the annual financial
statements for RiverSource Money Market Series, Inc. were as follows:
2007 - $20,650
(b) Audit - Related Fees. The fees for the year ended July 31, to Ernst & Young
LLP for additional professional services rendered in connection with the
registrant's security count pursuant to Rule 17f-2 and the semiannual
financial statement reviews for RiverSource Money Market Series, Inc. were
as follows:
2007 - $795
(c) Tax Fees. The fees for the year ended July 31, to Ernst & Young LLP for tax
compliance related services for RiverSource Money Market Series, Inc. were
as follows:
2007 - $2,700
(d) All Other Fees. The fees for the year ended July 31, to Ernst & Young LLP
for additional professional services rendered for RiverSource Money Market
Series, Inc. were as follows:
2007 - $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
2007 were pre-approved by the audit committee.
(f) Not applicable.
(g) Non-Audit Fees. The fees for the year ended July 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:
2007 - $235,575
(h) 100% of the services performed in item (g) above during 2007 were
pre-approved by the audit committee.
Item 5. Audit Committee of Listed Registrants. Not applicable.
Item 6. The complete schedule of investments is included in Item 1 of this
Form N-CSR.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies. Not applicable.
Item 8. 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 Money Market Series, Inc.
By /s/ Patrick T. Bannigan
----------------------------------
Patrick T. Bannigan
President and Principal Executive
Officer
Date October 3, 2007
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 October 3, 2007
By /s/ Jeffrey P. Fox
----------------------------------
Jeffrey P. Fox
Treasurer and Principal Financial
Officer
Date October 3, 2007