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 811-21197
811-21300
Name of Fund: WCMA Government Securities Fund
Master Government Securities Trust
Fund Address: P.O. Box 9011
Princeton, NJ 08543-9011
Name and address of agent for service: Robert C. Doll, Jr., Chief Executive
Officer, WCMA Government Securities Fund and Master Government Securities
Trust, 800 Scudders Mill Road, Plainsboro, NJ 08536. Mailing address:
P.O. Box 9011, Princeton, NJ 08543-9011
Registrant's telephone number, including area code: (609) 282-2800
Date of fiscal year end: 03/31/05
Date of reporting period: 04/01/04 - 03/31/05
Item 1 - Report to Stockholders
WCMA Government
Securities Fund
Annual Report
March 31, 2005
WCMA Government Securities Fund
Important Tax Information
Of the ordinary income distributions paid by WCMA Government Securities Fund
during the taxable year ended March 31, 2005, 31.58% was attributable to federal
obligations. In calculating the foregoing percentage, Fund expenses have been
allocated on a pro rata basis. The law varies in each state as to whether and
what percentage of dividend income attributable to federal obligations is exempt
from state income tax. We recommend that you consult your tax adviser to
determine if any portion of the dividends you received is exempt from state
income taxes.
Availability of Quarterly Schedule of Investments
The Fund files its complete schedule of portfolio holdings with the Securities
and Exchange Commission ("SEC") for the first and third quarters of each fiscal
year on Form N-Q. The Fund's Forms N-Q are available on the SEC's Web site at
http://www.sec.gov. The Fund's Forms N-Q may also be reviewed and copied at the
SEC's Public Reference Room in Washington, DC. Information on the operation of
the Public Reference Room may be obtained by calling 1-800-SEC-0330.
Electronic Delivery
The Fund offers electronic delivery of communications to its shareholders. In
order to receive this service, you must register your account and provide us
with e-mail information. To sign up for this service, simply access this website
at http://www.icsdelivery.com/live and follow the instructions. When you visit
this site, you will obtain a personal identification number (PIN). You will need
this PIN should you wish to update your e-mail address, choose to discontinue
this service and/or make any other changes to the service. This service is not
available for certain retirement accounts at this time.
2 WCMA GOVERNMENT SECURITIES FUND MARCH 31, 2005
A Letter From the President
Dear Shareholder
Financial markets broadly posted positive returns over the most recent reporting
period, with international equities providing some of the most impressive
results.
Total Returns as of March 31, 2005 6-month 12-month
================================================================================================
U.S. equities (Standard & Poor's 500 Index) + 6.88% + 6.69%
- ------------------------------------------------------------------------------------------------
Small-cap U.S. equities (Russell 2000 Index) + 8.00 + 5.41
- ------------------------------------------------------------------------------------------------
International equities (MSCI Europe Australasia Far East Index) +15.13 +15.06
- ------------------------------------------------------------------------------------------------
Fixed income (Lehman Brothers Aggregate Bond Index) + 0.47 + 1.15
- ------------------------------------------------------------------------------------------------
Tax-exempt fixed income (Lehman Brothers Municipal Bond Index) + 1.21 + 2.67
- ------------------------------------------------------------------------------------------------
High yield bonds (Credit Suisse First Boston High Yield Index) + 3.39 + 7.84
- ------------------------------------------------------------------------------------------------
The U.S. economy continued to show resilience in the face of the Federal Reserve
Board's (the Fed's) continued interest rate hikes and, more recently, higher oil
prices. The Fed's measured tightening program brought the federal funds rate to
2.75% by period-end as the central bank continued its campaign to combat
emergent inflation. In fact, business costs have been rising, which is beginning
to put pressure on corporate profit margins. Consumer prices have been moving up
as well, particularly in the areas of gasoline prices, healthcare costs, housing
and education.
U.S. equities ended 2004 in a strong rally, but stumbled into negative territory
in the first quarter of 2005. On the positive side, corporations have been
accelerating their hiring plans, capital spending remains reasonably robust and
merger-and-acquisition activity has increased. Offsetting the positives are
slowing corporate earnings growth, renewed energy price concerns and the
potential for an economic slowdown later this year. International equities,
especially in Asia, have benefited from higher economic growth rates. China, in
particular, recorded growth of more than 9% in 2004.
In the bond market, long-term interest rates finally began to inch higher while
significant increases have been recorded on the short end. This resulted in a
flattening of the yield curve throughout much of the current reporting period.
At March 31, 2005, the two-year Treasury note yielded 3.80% and the 10-year note
yielded 4.50%, a difference of 70 basis points (.70%). This compared to a spread
of 151 basis points six months earlier and 226 basis points 12 months ago.
Looking ahead, the environment is likely to be a challenging one for investors,
with diversification and selectivity becoming increasingly important themes.
With this in mind, we encourage you to meet with your financial advisor to
review your goals and asset allocation and to rebalance your portfolio, as
necessary, to ensure it remains aligned with your objectives and risk tolerance.
As always, we thank you for trusting Merrill Lynch Investment Managers with your
investment assets, and we look forward to serving you in the months and years
ahead.
Sincerely,
/s/ Robert C. Doll, Jr.
Robert C. Doll, Jr.
President and Trustee
WCMA GOVERNMENT SECURITIES FUND MARCH 31, 2005 3
A Discussion With Your Fund's Portfolio Manager
We maintained a relatively conservative approach throughout the year in
recognition of rising interest rates, particularly in the short end of the yield
curve.
How did the Fund perform during the fiscal year in light of the existing market
conditions?
For the 12-month period ended March 31, 2005, WCMA Government Securities Fund's
Class 1, Class 2, Class 3 and Class 4 Shares paid shareholders net annualized
dividends of .27%, .70%, 1.02% and 1.02%, respectively. For the six-month period
ended March 31, 2005, the Fund's Class 1, Class 2, Class 3 and Class 4 Shares
paid shareholders net annualized dividends of .50%, 1.11%, 1.43% and 1.43%,
respectively. The Fund's seven-day yields as of March 31, 2005 were 1.14% for
Class 1, 1.69% for Class 2, 2.01% for Class 3 and 2.01% for Class 4.
The Fund's average portfolio maturity at March 31, 2005 was 41 days, compared to
47 days at September 30, 2004 and 60 days at March 31, 2004.
We continued to employ a barbell strategy throughout the year. This involved
emphasizing the very front end of the market (overnight and term financing) for
liquidity and initially adding longer-dated securities for yield enhancement and
price appreciation. As the Federal Reserve Board (the Fed) embarked on its
"measured" monetary tightening campaign in June 2004, short-term interest rates
began to rise -- and continued their advance throughout the Fund's fiscal year.
This gave us reason to approach longer-dated securities with caution, as their
market value tends to suffer more in a rising rate environment. As a result of
managing the portfolio's average life and longer-dated holdings, the Fund was
able to deliver highly competitive results relative to its peers.
For the most part, the economy remained on solid footing throughout the past 12
months. Gross domestic product (GDP), which grew at an annualized rate of 4.5%
in the first quarter of 2004, slowed to 3.3% in the second quarter before
increasing to 4% in the third quarter and 3.8% in the fourth quarter. A similar
level of GDP growth is expected in the first quarter of 2005. Gains in personal
income contributed to GDP growth in 2004, although job creation has not been as
robust as in previous economic recoveries.
In the past several months, the major themes have centered on inflation and, in
particular, the price of oil. Inflation appeared to pick up at the producer
level, although a similar increase was not recorded at the consumer level.
Nevertheless, the Fed continued to target higher interest rates to combat
inflation expectations, bringing the federal funds rate to 2.75% by period-end.
The Fed maintained its commitment to a measured monetary tightening program even
in the face of rising oil prices, which many feared could increase inflationary
pressures and threaten the economic growth forecasts at certain points
throughout the period. However, the oil price shocks were largely absorbed by
the markets.
As short-term interest rates rose in symphony with the Fed's rate hikes,
long-term interest rates remained stubbornly low, producing what Fed Chairman
Alan Greenspan in February described as a "conundrum." The result was a
considerable flattening of the yield curve over the past 12 months, with the
two-year Treasury yield increasing 220 basis points (2.20%) while the 10-year
Treasury yield increased just 65 basis points during the period. Notably, the
short end of the curve has remained quite steep, with a 100 basis point spread
between three-month and two-year Treasury securities at period-end.
Issuance of Treasury securities continued to increase, largely to fund the
significant twin deficits. Notably, the heavy supply continued to be absorbed by
foreign interest in holding U.S. assets, despite the declining value of the U.S.
dollar. The Treasury has remained prudent in its issuance of bills by adjusting
the size of the weekly four-week bill as a cash management tool. In addition,
the government's increased collection of both corporate and individual payroll
taxes -- coincident with improving employment -- has helped offset the need for
additional supply in the short end.
How did you manage the portfolio during the period?
Primarily, our approach to managing the Trust in this rising interest rate
environment has been to maintain a relatively short average portfolio maturity.
4 WCMA GOVERNMENT SECURITIES FUND MARCH 31, 2005
While we continued to manage the Trust by employing a barbelled approach
throughout the period, we believed the two-year sector would give up the most
ground in a rising interest rate environment. As a result, we did not
participate in longer-dated securities and focused primarily on increasing our
liquidity profile, namely in repurchase agreements and shorter-dated Treasury
issues. We targeted one-year maturities as the fulcrum point of the yield curve
and ultimately determined that the six-month to one-year sector offered the best
opportunity for yield enhancement and price appreciation. At the short-end, we
maintained approximately three-quarters of net assets in repurchase agreements,
which comprised primarily overnight and one-week maturities. This sector resets
to market rates much quicker than longer-dated securities while also allowing
the Fund ample liquidity.
How would you characterize the portfolio's position at the close of the period?
Our positioning at period-end could be best described as "cautious." From a
market perspective, the interesting question centers on when the Fed may become
more data dependent in determining monetary policy. Consensus expectations at
this point are that the Fed will continue its measured approach to rate
increases until the federal funds rate reaches a "neutral" level (relative to
inflation) in the area of 3.5%. This is likely to take us to at least mid-year,
at which point the Fed may pause to consider the impact of its tightening
program and evaluate future moves.
While the deficits and the resultant heavy supply are here to stay, the Treasury
has made it clear that any measurable increase in new debt will take place
further out on the yield curve, particularly in the 10-year area. Given the
recent employment situation and increased tax receipts this April (versus April
2004), we anticipate that Treasury bill supply may be reduced at the short end
of the yield curve. This would create a steeper curve in the front end as well
as lower financing rates for Treasury securities versus other investment
vehicles. Still, new issuance should remain fairly robust, mostly in the long
end.
Less certain is whether employment will continue to improve and how much of
inflation at the producer price level will be passed on to the consumer. We will
continue to monitor developments on these fronts, and will look for
opportunities to lengthen the portfolio's average maturity if the economy
exhibits signs of faltering.
The Trust's portfolio composition, as a percent of net assets, at the end of
March and as of our last report to shareholders is detailed below:
- --------------------------------------------------------------------------------
3/31/05 9/30/04
- --------------------------------------------------------------------------------
Repurchase Agreements .......................... 75.5% 67.8%
U.S. Government Obligations .................... 23.8 31.8
Other Assets Less Liabilities .................. 0.7 0.4
---------------------
Total .......................................... 100.0% 100.0%
=====================
John Ng
Vice President and Portfolio Manager
April 6, 2005
WCMA GOVERNMENT SECURITIES FUND MARCH 31, 2005 5
Disclosure of Expenses
Shareholders of this Fund may incur the following charges: (a) expenses related
to transactions, including sales charges, redemption fees and exchange fees; and
(b) operating expenses, including advisory fees, distribution fees including
12(b)-1 fees, and other Fund expenses. The following example (which is based on
a hypothetical investment of $1,000 invested on October 1, 2004 and held through
March 31, 2005) is intended to assist shareholders both in calculating expenses
based on an investment in the Fund and in comparing these expenses with similar
costs of investing in other mutual funds.
The first table below provides information about actual account values and
actual expenses. In order to estimate the expenses a shareholder paid during the
period covered by this report, shareholders can divide their account value by
$1,000 and then multiply the result by the number in the first line under the
heading entitled "Expenses Paid During the Period."
The second table below provides information about hypothetical account values
and hypothetical expenses based on the Fund's actual expense ratio and an
assumed rate of return of 5% per year before expenses. In order to assist
shareholders in comparing the ongoing expenses of investing in this Fund and
other funds, compare the 5% hypothetical example with the 5% hypothetical
examples that appear in other funds' shareholder reports.
The expenses shown in the table are intended to highlight shareholders ongoing
costs only and do not reflect any transactional expenses, such as sales charges,
redemption fees or exchange fees. Therefore, the second table is useful in
comparing ongoing expenses only, and will not help shareholders determine the
relative total expenses of owning different funds. If these transactional
expenses were included, shareholder expenses would have been higher.
Expenses Paid
Beginning Ending During the Period*
Account Value Account Value October 1, 2004 to
October 1, 2004 March 31, 2005 March 31, 2005
==========================================================================================================
Actual
==========================================================================================================
Class 1 $1,000 $1,002.50 $7.99
- ----------------------------------------------------------------------------------------------------------
Class 2 $1,000 $1,005.50 $4.95
- ----------------------------------------------------------------------------------------------------------
Class 3 $1,000 $1,007.10 $3.35
- ----------------------------------------------------------------------------------------------------------
Class 4 $1,000 $1,007.10 $3.35
==========================================================================================================
Hypothetical (5% annual return before expenses)**
==========================================================================================================
Class 1 $1,000 $1,016.95 $8.05
- ----------------------------------------------------------------------------------------------------------
Class 2 $1,000 $1,020.00 $4.99
- ----------------------------------------------------------------------------------------------------------
Class 3 $1,000 $1,021.59 $3.38
- ----------------------------------------------------------------------------------------------------------
Class 4 $1,000 $1,021.59 $3.38
- ----------------------------------------------------------------------------------------------------------
* For each class of the Fund, expenses are equal to the annualized expense
ratio for the class (1.60% for Class 1, .99% for Class 2, .67% for Class 3
and .67% for Class 4), multiplied by the average account value over the
period, multiplied by 182/365 (to reflect the one-half year period shown).
Because the Fund is a feeder fund, the expense table example reflects the
expenses of both the feeder fund and the master fund in which it invests.
** Hypothetical 5% annual return before expenses is calculated by pro-rating
the number of days in the most recent fiscal half-year divided by 365.
6 WCMA GOVERNMENT SECURITIES FUND MARCH 31, 2005
Statement of Assets and Liabilities WCMA Government Securities Fund
As of March 31, 2005
=================================================================================================================
Assets
- -----------------------------------------------------------------------------------------------------------------
Investment in Master Government Securities Trust (the
"Trust"), at value (identified cost--$411,662,818) ... $ 411,153,982
Prepaid expenses ...................................... 46,575
-------------
Total assets .......................................... 411,200,557
-------------
=================================================================================================================
Liabilities
- -----------------------------------------------------------------------------------------------------------------
Payables:
Administrator ...................................... $ 75,770
Distributor ........................................ 72,789
Other affiliates ................................... 6,990 155,549
-------------
Accrued expenses ...................................... 70,042
-------------
Total liabilities ..................................... 225,591
-------------
=================================================================================================================
Net Assets
- -----------------------------------------------------------------------------------------------------------------
Net assets ............................................ $ 410,974,966
=============
=================================================================================================================
Net Assets Consist of
- -----------------------------------------------------------------------------------------------------------------
Class 1 Shares of beneficial interest, $.10 par value,
unlimited number of shares authorized ................ $ 1,673,782
Class 2 Shares of beneficial interest, $.10 par value,
unlimited number of shares authorized ................ 11,984,625
Class 3 Shares of beneficial interest, $.10 par value,
unlimited number of shares authorized ................ 19,342,277
Class 4 Shares of beneficial interest, $.10 par value,
unlimited number of shares authorized ................ 8,147,696
Paid-in capital in excess of par ...................... 370,335,422
Unrealized depreciation allocated from the Trust--net . (508,836)
-------------
Net Assets ............................................ $ 410,974,966
=============
=================================================================================================================
Net Asset Value
- -----------------------------------------------------------------------------------------------------------------
Class 1--Based on net assets of $16,717,544 and 16,737,822
shares of beneficial interest outstanding ............ $ 1.00
=============
Class 2--Based on net assets of $119,717,645 and 119,846,249
shares of beneficial interest outstanding ............ $ 1.00
=============
Class 3--Based on net assets of $193,195,369 and 193,422,770
shares of beneficial interest outstanding ............ $ 1.00
=============
Class 4--Based on net assets of $81,344,408 and 81,476,963
shares of beneficial interest outstanding ............ $ 1.00
=============
See Notes to Financial Statements.
WCMA GOVERNMENT SECURITIES FUND MARCH 31, 2005 7
Statement of Operations WCMA Government Securities Fund
For the Year Ended March 31, 2005
=================================================================================================================
Investment Income
- -----------------------------------------------------------------------------------------------------------------
Interest .............................................. $ 20,129
Net investment income allocated from the Trust:
Interest (includes $369,758 from affiliates) and
amortization of premium and discount earned ....... 7,553,343
Expenses ........................................... (1,141,606)
-------------
Total income .......................................... 6,431,866
-------------
=================================================================================================================
Expenses
- -----------------------------------------------------------------------------------------------------------------
Administration fees ................................... $ 1,153,881
Account maintenance and distribution fees--Class 2 .... 789,371
Account maintenance and distribution fees--Class 3 .... 767,706
Account maintenance and distribution fees--Class 4 .... 444,257
Registration fees ..................................... 362,021
Account maintenance and distribution fees--Class 1 .... 186,972
Printing and shareholder reports ...................... 38,808
Professional fees ..................................... 23,805
Offering costs ........................................ 18,227
Transfer agent fees--Class 3 .......................... 10,339
Transfer agent fees--Class 4 .......................... 6,044
Transfer agent fees--Class 2 .......................... 5,870
Transfer agent fees--Class 1 .......................... 938
Other ................................................. 16,425
-------------
Total expenses before waiver and reimbursement ........ 3,824,664
Waiver and reimbursement of expenses .................. (1,402,909)
-------------
Total expenses after waiver and reimbursement ......... 2,421,755
-------------
Investment income--net ................................ 4,010,111
-------------
=================================================================================================================
Realized & Unrealized Gain (Loss) Allocated from the Trust--Net
- -----------------------------------------------------------------------------------------------------------------
Realized gain--net .................................... 523
Change in unrealized depreciation--net ................ (458,656)
-------------
Total realized and unrealized loss--net ............... (458,133)
-------------
Net Increase in Net Assets Resulting from Operations .. $ 3,551,978
=============
See Notes to Financial Statements.
8 WCMA GOVERNMENT SECURITIES FUND MARCH 31, 2005
Statements of Changes in Net Assets WCMA Government Securities Fund
For the Year Ended
March 31,
-------------------------------
Increase (Decrease) in Net Assets: 2005 2004
=================================================================================================================
Operations
- -----------------------------------------------------------------------------------------------------------------
Investment income--net ................................ $ 4,010,111 $ 1,319,470
Realized gain--net .................................... 523 17,972
Change in unrealized depreciation--net ................ (458,656) (50,180)
-------------------------------
Net increase in net assets resulting from operations .. 3,551,978 1,287,262
-------------------------------
=================================================================================================================
Dividends & Distributions to Shareholders
- -----------------------------------------------------------------------------------------------------------------
Investment income--net:
Class 1 ............................................ (45,741) (4,498)
Class 2 ............................................ (802,254) (130,640)
Class 3 ............................................ (2,069,332) (722,881)
Class 4 ............................................ (1,092,784) (461,453)
Realized gain--net:
Class 1 ............................................ (21) (658)
Class 2 ............................................ (124) (4,641)
Class 3 ............................................ (231) (8,056)
Class 4 ............................................ (147) (4,617)
-------------------------------
Net decrease in net assets resulting from dividends and
distributions to shareholders ........................ (4,010,634) (1,337,444)
-------------------------------
=================================================================================================================
Beneficial Interest Transactions
- -----------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets derived from
beneficial interest transactions ..................... (129,873,585) 541,257,315
-------------------------------
=================================================================================================================
Net Assets
- -----------------------------------------------------------------------------------------------------------------
Total increase (decrease) in net assets ............... (130,332,241) 541,207,133
Beginning of year ..................................... 541,307,207 100,074
-------------------------------
End of year ........................................... $ 410,974,966 $ 541,307,207
===============================
See Notes to Financial Statements.
WCMA GOVERNMENT SECURITIES FUND MARCH 31, 2005 9
Financial Highlights WCMA Government Securities Fund
Class 1
--------------------------------------------
For the Year Ended For the Period
March 31, March 20, 2003+
The following per share data and ratios have been derived -------------------------- to March 31,
from information provided in the financial statements. 2005 2004 2003
=======================================================================================================================
Per Share Operating Performance
- -----------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period ............ $ 1.00 $ 1.00 $ 1.00
--------------------------------------------
Investment income--net .......................... .0027 .0004 .0003
Realized and unrealized gain (loss)--net ........ (.0012) (.0002) .0002
--------------------------------------------
Total from investment operations ................ .0015 .0002 .0005
--------------------------------------------
Less dividends and distributions:
Investment income--net ......................... (.0027) (.0004) (.0003)
Realized gain--net ............................. --* (.0001) --
--------------------------------------------
Total dividends and distributions ............... (.0027) (.0005) (.0003)
--------------------------------------------
Net asset value, end of period .................. $ 1.00 $ 1.00 $ 1.00
============================================
=======================================================================================================================
Total Investment Return
- -----------------------------------------------------------------------------------------------------------------------
Total investment return ......................... .27% .05% .05%
============================================
=======================================================================================================================
Ratios to Average Net Assets
- -----------------------------------------------------------------------------------------------------------------------
Total expenses, net of waiver and reimbursement** 1.41% 1.09% .02%
============================================
Total expenses** ................................ 1.60% 1.58% .02%
============================================
Total investment income and realized gain--net .. .24% .04% .03%
============================================
=======================================================================================================================
Supplemental Data
- -----------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) ........ $ 16,718 $ 22,260 $ 25
============================================
+ Effective date of the Fund's registration.
* Amount is less than $(.0001) per share.
** Includes the Fund's share of the Trust's allocated expenses.
See Notes to Financial Statements.
10 WCMA GOVERNMENT SECURITIES FUND MARCH 31, 2005
Financial Highlights (continued) WCMA Government Securities Fund
Class 2
--------------------------------------------
For the Year Ended For the Period
March 31, March 20, 2003+
The following per share data and ratios have been derived -------------------------- to March 31,
from information provided in the financial statements. 2005 2004 2003
=======================================================================================================================
Per Share Operating Performance
- -----------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period ............ $ 1.00 $ 1.00 $ 1.00
--------------------------------------------
Investment income--net .......................... .0070 .0015 .0003
Realized and unrealized gain (loss)--net ........ (.0011) (.0001) .0002
--------------------------------------------
Total from investment operations ................ .0059 .0014 .0005
--------------------------------------------
Less dividends and distributions:
Investment income--net ......................... (.0070) (.0015) (.0003)
Realized gain--net ............................. --* (.0001) --
--------------------------------------------
Total dividends and distributions ............... (.0070) (.0016) (.0003)
--------------------------------------------
Net asset value, end of period .................. $ 1.00 $ 1.00 $ 1.00
============================================
=======================================================================================================================
Total Investment Return
- -----------------------------------------------------------------------------------------------------------------------
Total investment return ......................... .70% .16% .05%
============================================
=======================================================================================================================
Ratios to Average Net Assets
- -----------------------------------------------------------------------------------------------------------------------
Total expenses, net of waiver and reimbursement** .98% .97% .02%
============================================
Total expenses** ................................ 1.28% 1.26% .02%
============================================
Total investment income and realized gain--net .. .68% .15% .03%
============================================
=======================================================================================================================
Supplemental Data
- -----------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) ........ $119,718 $137,566 $ 25
============================================
+ Effective date of the Fund's registration.
* Amount is less than $(.0001) per share.
** Includes the Fund's share of the Trust's allocated expenses.
See Notes to Financial Statements.
WCMA GOVERNMENT SECURITIES FUND MARCH 31, 2005 11
Financial Highlights (continued) WCMA Government Securities Fund
Class 3
--------------------------------------------
For the Year Ended For the Period
March 31, March 20, 2003+
The following per share data and ratios have been derived -------------------------- to March 31,
from information provided in the financial statements. 2005 2004 2003
=======================================================================================================================
Per Share Operating Performance
- -----------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period ............ $ 1.00 $ 1.00 $ 1.00
--------------------------------------------
Investment income--net .......................... .0102 .0047 .0003
Realized and unrealized gain (loss)--net ........ (.0010) (.0001) .0002
--------------------------------------------
Total from investment operations ................ .0092 .0046 .0005
--------------------------------------------
Less dividends and distributions:
Investment income--net ......................... (.0102) (.0047) (.0003)
Realized gain--net ............................. --* (.0001) --
--------------------------------------------
Total dividends and distributions ............... (.0102) (.0048) (.0003)
--------------------------------------------
Net asset value, end of period .................. $ 1.00 $ 1.00 $ 1.00
============================================
=======================================================================================================================
Total Investment Return
- -----------------------------------------------------------------------------------------------------------------------
Total investment return ......................... 1.03% .48% .05%
============================================
=======================================================================================================================
Ratios to Average Net Assets
- -----------------------------------------------------------------------------------------------------------------------
Total expenses, net of waiver and reimbursement** .66% .65% .02%
============================================
Total expenses** ................................ .98% .96% .02%
============================================
Total investment income and realized gain--net .. 1.01% .48% .03%
============================================
=======================================================================================================================
Supplemental Data
- -----------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) ........ $193,195 $224,278 $ 25
============================================
+ Effective date of the Fund's registration.
* Amount is less than $(.0001) per share.
** Includes the Fund's share of the Trust's allocated expenses.
See Notes to Financial Statements.
12 WCMA GOVERNMENT SECURITIES FUND MARCH 31, 2005
Financial Highlights (concluded) WCMA Government Securities Fund
Class 4
--------------------------------------------
For the Year Ended For the Period
March 31, March 20, 2003+
The following per share data and ratios have been derived -------------------------- to March 31,
from information provided in the financial statements. 2005 2004 2003
=======================================================================================================================
Per Share Operating Performance
- -----------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period ............ $ 1.00 $ 1.00 $ 1.00
--------------------------------------------
Investment income--net .......................... .0102 .0047 .0003
Realized and unrealized gain--net ............... (.0012) --* .0002
--------------------------------------------
Total from investment operations ................ .0090 .0047 .0005
--------------------------------------------
Less dividends and distributions:
Investment income--net ......................... (.0102) (.0047) (.0003)
Realized gain--net ............................. --** --** --
--------------------------------------------
Total dividends and distributions ............... (.0102) (.0047) (.0003)
--------------------------------------------
Net asset value, end of period .................. $ 1.00 $ 1.00 $ 1.00
============================================
=======================================================================================================================
Total Investment Return
- -----------------------------------------------------------------------------------------------------------------------
Total investment return ......................... 1.03% .47% .05%
============================================
=======================================================================================================================
Ratios to Average Net Assets
- -----------------------------------------------------------------------------------------------------------------------
Total expenses, net of waiver and reimbursement*** .66% .65% .02%
============================================
Total expenses*** ............................... .97% .96% .02%
============================================
Total investment income and realized gain--net .. .91% .48% .03%
============================================
=======================================================================================================================
Supplemental Data
- -----------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) ........ $ 81,344 $157,203 $ 25
============================================
+ Effective date of the Fund's registration.
* Amount is less than $.0001 per share.
** Amount is less than $(.0001) per share.
*** Includes the Fund's share of the Trust's allocated expenses.
See Notes to Financial Statements.
WCMA GOVERNMENT SECURITIES FUND MARCH 31, 2005 13
Notes to Financial Statements WCMA Government Securities Fund
1. Significant Accounting Policies:
WCMA Government Securities Fund (the "Fund") is registered under the Investment
Company Act of 1940, as amended, as a no load, diversified, open-end management
investment company. The Fund seeks to achieve its investment objective by
investing all of its assets in the Master Government Securities Trust (the
"Trust"), which has the same investment objective and strategies as the Fund.
The value of the Fund's investment in the Trust reflects the Fund's
proportionate interest in the net assets of the Trust. The performance of the
Fund is directly affected by the performance of the Trust. The financial
statements of the Trust, including the Schedule of Investments, are included
elsewhere in this report and should be read in conjunction with the Fund's
financial statements. The Fund's financial statements are prepared in conformity
with U.S. generally accepted accounting principles, which may require the use of
management accruals and estimates. Actual results may differ from these
estimates. The percentage of the Trust owned by the Fund at March 31, 2005 was
43.9%. The Fund is divided into four classes, designated Class 1, Class 2, Class
3 and Class 4. Each Class 1, Class 2, Class 3 and Class 4 share represents
interests in the same assets of the Fund and have identical voting, dividend,
liquidation and other rights and the same terms and conditions, except that each
class bears certain expenses related to account maintenance and the distribution
of such shares and the additional incremental transfer agency costs resulting
from the conversion of shares and have exclusive voting with respect to matters
relating to such account maintenance and distribution expenditures. Income,
expenses (other than expenses attributed to a specific class) and realized and
unrealized gains and losses on investments are allocated daily to each class
based on its relative net assets. The following is a summary of significant
accounting policies followed by the Fund.
(a) Valuation of investments -- The Fund records its investments in the Trust at
fair value. Valuation of securities held by the Trust is discussed in Note 1a of
the Trust's Notes to Financial Statements, which are included elsewhere in this
report.
(b) Investment income and expenses -- The Fund records daily its proportionate
share of the Trust's income, expenses and realized and unrealized gains and
losses. In addition, the Fund accrues its own income and expenses.
(c) Income taxes -- It is the Fund's policy to comply with the requirements of
the Internal Revenue Code applicable to regulated investment companies and to
distribute substantially all of its taxable income to its shareholders.
Therefore, no federal income tax provision is required.
(d) Prepaid registration fees -- Prepaid registration fees are charged to
expense as the related shares are issued.
(e) Dividends and distributions to shareholders -- The Fund declares dividends
daily and reinvests daily such dividends (net of non-resident alien tax and
backup withholding tax withheld) in additional fund shares at net asset value.
Dividends and distributions are declared from the total of net investment income
and net realized gain or loss on investments.
(f) Investment transactions -- Investment transactions in the Trust are
accounted for on a trade date basis.
2. Transactions with Affiliates:
The Fund has entered into an Administration Agreement with Fund Asset
Management, L.P. ("FAM"). The general partner of FAM is Princeton Services, Inc.
("PSI"), a wholly-owned subsidiary of Merrill Lynch & Co., Inc. ("ML & Co."),
which is the limited partner. The Fund pays a monthly fee at an annual rate of
..25% of the Fund's average daily net assets for the performance of
administrative services (other than investment advice and related portfolio
activities) necessary for the operation of the Fund.
The Fund has adopted a Distribution Plan in compliance with Rule 12b-1 under the
Investment Company Act of 1940, pursuant to which Merrill Lynch, Pierce, Fenner
& Smith Incorporated ("MLPF&S"), an affiliate of FAM, receives account
maintenance and distribution fees from the Fund. The fees are accrued daily and
paid monthly at annual rates based upon the average daily net assets of the
shares of the Fund as follows:
- --------------------------------------------------------------------------------
Account Distribution
Maintenance Fee Fee
- --------------------------------------------------------------------------------
Class 1 ................................. .25% .75%
Class 2 ................................. .25% .425%
Class 3 ................................. .25% .125%
Class 4 ................................. .25% .125%
- --------------------------------------------------------------------------------
The ongoing account maintenance fee compensates MLPF&S for providing account
maintenance services to shareholders. The ongoing distribution fee compensates
MLPF&S for providing shareholder and distribution related services to
shareholders. The Fund has entered into a contractual arrangement with FAM and
MLPF&S to waive and/or reimburse a portion of the Fund's fees and expenses to
ensure that the net expenses for the Fund's Class 2 Shares is .32% higher than
14 WCMA GOVERNMENT SECURITIES FUND MARCH 31, 2005
Notes to Financial Statements (continued) WCMA Government Securities Fund
that of CMA Government Securities Fund, and Class 3 and Class 4 Shares is equal
to that of CMA Government Securities Fund. The fee/expense waiver or
reimbursement includes account maintenance and distribution fees. This
arrangement has a one-year term and is renewable. The Distributor has
voluntarily agreed to waive a portion of its distribution fees in order to
ensure that each class of shareholders receive a positive yield on each daily
dividend. For the year ended March 31, 2005, FAM and MLPF&S have earned
$1,153,881 and $2,188,306, respectively, of which $1,402,909 was waived and/or
reimbursed.
Financial Data Services, Inc. ("FDS"), a wholly-owned subsidiary of ML & Co., is
the Fund's transfer agent. Interest is earned by the Fund from FDS based on the
difference, if any, between estimated and actual daily beneficial share
activity, which results in uninvested net proceeds from sales of Fund shares.
Certain officers and/or trustees of the Fund are officers and/or directors of
FAM, PSI, FDS, and/or ML & Co.
3. Beneficial Interest Transactions:
Net increase (decrease) in net assets derived from beneficial interest
transactions was $(129,873,585) and $541,257,315 for the years ended March 31,
2005 and March 31, 2004, respectively.
Transactions in shares of beneficial interest for each class were as follows:
- --------------------------------------------------------------------------------
Class 1 Shares for the Year Dollar
Ended March 31, 2005 Shares Amount
- --------------------------------------------------------------------------------
Shares sold .......................... 166,331,085 $ 166,331,085
Shares issued to shareholders
in reinvestment of dividends
and distributions ................. 45,759 45,759
------------------------------------
Total issued ......................... 166,376,844 166,376,844
Shares redeemed ...................... (171,902,807) (171,902,807)
------------------------------------
Net decrease ......................... (5,525,963) $ (5,525,963)
====================================
- --------------------------------------------------------------------------------
Class 1 Shares for the Year Dollar
Ended March 31, 2004 Shares Amount
- --------------------------------------------------------------------------------
Shares sold .......................... 129,156,599 $ 129,156,599
Shares issued to shareholders
in reinvestment of dividends
and distributions ................. 5,155 5,155
Shares issued in connection
with the bulk transfer of
WCMA shareholder assets ........... 24,197,893 24,197,893
------------------------------------
Total issued ......................... 153,359,647 153,359,647
Shares redeemed ...................... (131,120,880) (131,120,880)
------------------------------------
Net increase ......................... 22,238,767 $ 22,238,767
====================================
- --------------------------------------------------------------------------------
Class 2 Shares for the Year Dollar
Ended March 31, 2005 Shares Amount
- --------------------------------------------------------------------------------
Shares sold .......................... 674,997,471 $ 674,997,471
Shares issued to shareholders
in reinvestment of dividends
and distributions ................. 802,382 802,382
------------------------------------
Total issued ......................... 675,799,853 675,799,853
Shares redeemed ...................... (693,537,095) (693,537,095)
------------------------------------
Net decrease ......................... (17,737,242) $ (17,737,242)
====================================
- --------------------------------------------------------------------------------
Class 2 Shares for the Year Dollar
Ended March 31, 2004 Shares Amount
- --------------------------------------------------------------------------------
Shares sold .......................... 451,353,350 $ 451,353,350
Shares issued to shareholders
in reinvestment of dividends
and distributions ................. 135,249 135,249
Shares issued in connection
with the bulk transfer of
WCMA shareholder assets ........... 153,348,889 153,348,889
------------------------------------
Total issued ......................... 604,837,488 604,837,488
Shares redeemed ...................... (467,279,015) (467,279,015)
------------------------------------
Net increase ......................... 137,558,473 $ 137,558,473
====================================
- --------------------------------------------------------------------------------
Class 3 Shares for the Year Dollar
Ended March 31, 2005 Shares Amount
- --------------------------------------------------------------------------------
Shares sold .......................... 1,265,546,454 $ 1,265,546,454
Shares issued to shareholders
in reinvestment of dividends
and distributions ................. 2,069,563 2,069,563
------------------------------------
Total issued ......................... 1,267,616,017 1,267,616,017
Shares redeemed ...................... (1,298,496,734) (1,298,496,734)
------------------------------------
Net decrease ......................... (30,880,717) $ (30,880,717)
====================================
- --------------------------------------------------------------------------------
Class 3 Shares for the Year Dollar
Ended March 31, 2004 Shares Amount
- --------------------------------------------------------------------------------
Shares sold .......................... 1,097,426,217 $ 1,097,426,217
Shares issued to shareholders in
reinvestment of dividends
and distributions ................. 730,937 730,937
Shares issued in connection
with the bulk transfer of
WCMA shareholder assets ........... 232,545,615 232,545,615
------------------------------------
Total issued ......................... 1,330,702,769 1,330,702,769
Shares redeemed ...................... (1,106,424,301) (1,106,424,301)
------------------------------------
Net increase ......................... 224,278,468 $ 224,278,468
====================================
WCMA GOVERNMENT SECURITIES FUND MARCH 31, 2005 15
Notes to Financial Statements (concluded) WCMA Government Securities Fund
- --------------------------------------------------------------------------------
Class 4 Shares for the Year Dollar
Ended March 31, 2005 Shares Amount
- --------------------------------------------------------------------------------
Shares sold .......................... 1,007,657,082 $ 1,007,657,082
Shares issued to shareholders
in reinvestment of dividends
and distributions ................. 1,092,931 1,092,931
------------------------------------
Total issued ......................... 1,008,750,013 1,008,750,013
Shares redeemed ...................... (1,084,479,676) (1,084,479,676)
------------------------------------
Net decrease ......................... (75,729,663) $ (75,729,663)
====================================
- --------------------------------------------------------------------------------
Class 4 Shares for the Year Dollar
Ended March 31, 2004 Shares Amount
- --------------------------------------------------------------------------------
Shares sold .......................... 842,090,508 $ 842,090,508
Shares issued to shareholders
in reinvestment of dividends
and distributions ................. 466,070 466,070
Shares issued in connection
with the bulk transfer of
WCMA shareholder assets ........... 168,910,427 168,910,427
------------------------------------
Total issued ......................... 1,011,467,005 1,011,467,005
Shares redeemed ...................... (854,285,398) (854,285,398)
------------------------------------
Net increase ......................... 157,181,607 $ 157,181,607
====================================
4. Distributions to Shareholders:
The tax character of distributions paid during the fiscal years ended March 31,
2005 and March 31, 2004 were as follows:
- --------------------------------------------------------------------------------
3/31/2005 3/31/2004
- --------------------------------------------------------------------------------
Distributions paid from:
Ordinary income .................... $ 4,010,634 $ 1,329,878
Net long-term capital gains ........ -- 7,566
------------------------------------
Total taxable distributions .......... $ 4,010,634 $ 1,337,444
====================================
As of March 31, 2005, there were no significant differences between the book and
tax components of net assets.
5. Capital Loss Carryforward:
On March 31, 2005, the Fund had a net capital loss carryforward of $909, all of
which expires in 2013. This amount will be available to offset like amounts of
any future taxable gains.
Report of Independent Registered Public Accounting Firm
WCMA Government Securities Fund
To the Shareholders and Board of Trustees of
WCMA Government Securities Fund:
We have audited the accompanying statement of assets and liabilities of WCMA
Government Securities Fund as of March 31, 2005, and the related statement of
operations for the year then ended, the statements of changes in net assets for
each of the two years in the period then ended and the financial highlights for
each of the respective periods 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 audits.
We conducted our audits 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. The Fund
is not required to have, nor were we engaged to perform, an audit of internal
control over financial reporting. Our audits 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, assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of WCMA
Government Securities Fund as of March 31, 2005, the results of its operations
for the year then ended, the changes in its net assets for each of the two years
in the period then ended and its financial highlights for each of the respective
periods then ended, in conformity with U.S. generally accepted accounting
principles.
Deloitte & Touche LLP
Princeton, New Jersey
May 20, 2005
16 WCMA GOVERNMENT SECURITIES FUND MARCH 31, 2005
Schedule of Investments Master Government Securities Trust (in Thousands)
Face Interest Maturity
Issue Amount Rate Date Value
======================================================================================================
U.S. Government Obligations*--23.8%
======================================================================================================
U.S. Treasury Bills $50,000 2.65 % 4/28/2005 $ 49,897
5,000 2.70 6/02/2005 4,977
8,800 2.40 6/16/2005 8,750
32,200 2.458-
2.477 6/23/2005 32,000
9,000 2.997 9/08/2005 8,881
- ------------------------------------------------------------------------------------------------------
U.S. Treasury Notes 15,700 1.25 5/31/2005 15,663
5,350 1.125 6/30/2005 5,329
2,500 1.625 9/30/2005 2,482
37,020 5.75 11/15/2005 37,583
8,900 1.875 11/30/2005 8,855
26,650 1.875 1/31/2006 26,329
22,000 1.625 2/28/2006 21,649
1,045 1.50 3/31/2006 1,025
- ------------------------------------------------------------------------------------------------------
Total U.S. Government Obligations
(Cost--$223,833) ................................................................ 223,420
- ------------------------------------------------------------------------------------------------------
Face
Amount Issue
======================================================================================================
Repurchase Agreements--75.5%
======================================================================================================
$46,000 ABN AMRO Bank N.V., New York Branch,
purchased on 3/30/2005 to yield 2.70%
to 4/06/2005, repurchase price $46,024,
collateralized by U.S. Treasury Bills, 2.43%
to 2.86% due 4/21/2005 to 8/04/2005 ........................... 46,000
- ------------------------------------------------------------------------------------------------------
46,000 Banc of America Securities LLC, purchased
on 3/30/2005 to yield 2.75% to 4/06/2005,
repurchase price $46,025, collateralized
by GNMA, 5.50% to 7% due 3/15/2018
to 3/15/2035 .................................................. 46,000
- ------------------------------------------------------------------------------------------------------
46,000 Barclays Capital, Inc., purchased on 3/31/2005
to yield 2.62% to 4/01/2005, repurchase
price $46,003, collateralized by U.S. Treasury
Bills, 2.615% due 5/26/2005 ................................... 46,000
- ------------------------------------------------------------------------------------------------------
12,918 Bear Stearns & Co., Inc., purchased on
3/31/2005 to yield 2.55% to 4/01/2005,
repurchase price $12,919, collateralized by
U.S. Treasury STRIPS+, due 2/15/2007 .......................... 12,918
- ------------------------------------------------------------------------------------------------------
47,000 Citigroup Global Markets, Inc., purchased on
3/29/2005 to yield 2.73% to 4/05/2005,
repurchase price $47,025, collateralized
by GNMA, 6.50% due 8/15/2034 .................................. 47,000
- ------------------------------------------------------------------------------------------------------
47,000 Countrywide Securities Corp., purchased
on 3/29/2005 to yield 2.78% to 4/05/2005,
repurchase price $47,025, collateralized by
GNMA, 6.50% due 12/15/2034 .................................... 47,000
- ------------------------------------------------------------------------------------------------------
47,000 Credit Suisse First Boston LLC, purchased
on 3/29/2005 to yield 2.77% to
4/05/2005, repurchase price $47,025,
collateralized by U.S. Treasury Notes, 3%
due 2/15/2008 and U.S. Treasury STRIPS+,
due 11/15/2017 to 2/15/2022 ................................... 47,000
- ------------------------------------------------------------------------------------------------------
47,000 Deutsche Bank Securities, Inc., purchased on
3/29/2005 to yield 2.73% to 4/05/2005,
repurchase price $47,025, collateralized
by GNMA, 2.75% to 5.90% due 4/15/2027
to 6/15/2045 .................................................. 47,000
- ------------------------------------------------------------------------------------------------------
44,000 Goldman Sachs & Company, purchased on
3/04/2005 to yield 2.61% to 4/01/2005,
repurchase price $44,089, collateralized
by GNMA, 6.50% due 10/20/2034 ................................. 44,000
- ------------------------------------------------------------------------------------------------------
46,000 Greenwich Capital Markets, Inc., purchased
on 3/30/2005 to yield 2.75% to 4/06/2005,
repurchase price $46,025, collateralized by
GNMA, 5% to 7.50% due 4/15/2029
to 11/15/2044 ................................................. 46,000
- ------------------------------------------------------------------------------------------------------
46,000 HSBC Securities (USA), Inc., purchased on
3/31/2005 to yield 2.65% to 4/01/2005,
repurchase price $46,003, collateralized by
U.S. Treasury STRIPS+, due 11/15/2015
to 11/15/2029 ................................................. 46,000
- ------------------------------------------------------------------------------------------------------
47,000 J.P. Morgan Securities Inc., purchased on
3/28/2005 to yield 2.78% to 4/04/2005,
repurchase price $47,025, collateralized
by GNMA, 6.05% to 6.50% due
2/20/2029 to 11/15/2044 ....................................... 47,000
- ------------------------------------------------------------------------------------------------------
46,000 Lehman Brothers, Inc., purchased on 3/31/2005
to yield 2.75% to 4/07/2005, repurchase price
$46,025, collateralized by GNMA, 2.75% to 14%
due 11/15/2005 to 3/15/2035 ................................... 46,000
- ------------------------------------------------------------------------------------------------------
WCMA GOVERNMENT SECURITIES FUND MARCH 31, 2005 17
Schedule of Investments (concluded)
Master Government Securities Trust (in Thousands)
Face
Amount Issue Value
======================================================================================================
Repurchase Agreements (continued)
======================================================================================================
$46,000 Merrill Lynch Government Securities,
Inc., purchased on 3/31/2005 to
yield 2.77% to 4/07/2005, repurchase
price $46,025, collateralized by GNMA,
3.375% to 16% due 6/15/2005
to 6/15/2045 (a) .............................................. $ 46,000
- ------------------------------------------------------------------------------------------------------
47,000 Morgan Stanley & Co., Inc., purchased on
3/29/2005 to yield 2.79% to 4/05/2005,
repurchase price $47,025, collateralized by
U.S. Treasury STRIPS+, due 5/15/2021 .......................... 47,000
- ------------------------------------------------------------------------------------------------------
46,000 UBS Securities LLC, purchased on 3/31/2005
to yield 2.77% to 4/07/2005, repurchase
price $46,025, collateralized by GNMA,
5.50% to 7.50% due 12/15/2027
to 5/15/2034 .................................................. 46,000
- ------------------------------------------------------------------------------------------------------
Total Repurchase Agreements (Cost--$706,918) .................................... 706,918
- ------------------------------------------------------------------------------------------------------
Total Investments (Cost--$930,751**)--99.3% ..................................... 930,338
Other Assets Less Liabilities--0.7% ............................................. 6,228
--------
Net Assets--100.0% .............................................................. $936,566
========
* U.S. Treasury Bills are traded on a discount basis; the interest rates
shown are the range of discount rates paid at the time of purchase by the
Trust. U.S. Treasury Notes bear interest at the rates shown, payable at
fixed dates until maturity.
** The cost and unrealized appreciation (depreciation) of investments as of
March 31, 2005, as computed for federal income tax purposes, were as
follows:
(in Thousands)
--------------------------------------------------------------------------
Aggregate cost .......................................... $ 930,751
==============
Gross unrealized appreciation ........................... $ 3
Gross unrealized depreciation ........................... (416)
--------------
Net unrealized depreciation ............................. $ (413)
==============
+Separately Traded Registered Interest and Principal of Securities.
(a) Investments in companies considered to be an affiliate of the Trust (such
companies are defined as "Affiliated Companies" in Section 2(a)(3) of the
Investment Company Act of 1940) were as follows:
(in Thousands)
--------------------------------------------------------------------------
Net Interest
Affiliate Activity Income
--------------------------------------------------------------------------
Merrill Lynch Government Securities, Inc. $(12,000) $836
--------------------------------------------------------------------------
See Notes to Financial Statements.
18 WCMA GOVERNMENT SECURITIES FUND MARCH 31, 2005
Statement of Assets and Liabilities Master Government Securities Trust
As of March 31, 2005
=================================================================================================================
Assets
- -----------------------------------------------------------------------------------------------------------------
Investments in unaffiliated securities, at value
(identified cost--$884,750,615) ...................... $ 884,337,843
Investments in affiliated securities, at value
(identified cost--$46,000,000) ....................... 46,000,000
Cash .................................................. 10,431
Receivables:
Contributions ...................................... $ 5,224,051
Interest ........................................... 1,186,081 6,410,132
-------------
Prepaid expenses ...................................... 6,192
-------------
Total assets .......................................... 936,764,598
-------------
=================================================================================================================
Liabilities
- -----------------------------------------------------------------------------------------------------------------
Payables:
Investment adviser ................................. 148,761
Other affiliates ................................... 10,196 158,957
-------------
Accrued expenses ...................................... 39,392
-------------
Total liabilities ..................................... 198,349
-------------
=================================================================================================================
Net Assets
- -----------------------------------------------------------------------------------------------------------------
Net assets ............................................ $ 936,566,249
=============
=================================================================================================================
Net Assets Consist of
- -----------------------------------------------------------------------------------------------------------------
Investors' capital .................................... $ 936,979,021
Unrealized depreciation--net .......................... (412,772)
-------------
Net Assets ............................................ $ 936,566,249
=============
See Notes to Financial Statements.
WCMA GOVERNMENT SECURITIES FUND MARCH 31, 2005 19
Statement of Operations Master Government Securities Trust
For the Year Ended March 31, 2005
=================================================================================================================
Investment Income
- -----------------------------------------------------------------------------------------------------------------
Interest (includes $835,675 from affiliates) and
amortization of premium and discount earned .......... $ 17,071,013
=================================================================================================================
Expenses
- -----------------------------------------------------------------------------------------------------------------
Investment advisory fees .............................. $ 2,165,461
Accounting services ................................... 240,680
Custodian fees ........................................ 58,974
Professional fees ..................................... 45,532
Trustees' fees and expenses ........................... 39,622
Pricing fees .......................................... 4,020
Printing and shareholder reports ...................... 2,070
Other ................................................. 21,020
-------------
Total expenses ........................................ 2,577,379
-------------
Investment income--net ................................ 14,493,634
-------------
=================================================================================================================
Realized & Unrealized Gain (Loss)--Net
- -----------------------------------------------------------------------------------------------------------------
Realized gain on investments--net ..................... 1,170
Change in unrealized appreciation/depreciation on
investments--net ..................................... (1,036,662)
-------------
Total realized and unrealized loss--net ............... (1,035,492)
-------------
Net Increase in Net Assets Resulting from Operations .. $ 13,458,142
=============
See Notes to Financial Statements.
20 WCMA GOVERNMENT SECURITIES FUND MARCH 31, 2005
Statements of Changes in Net Assets Master Government Securities Trust
For the Year Ended
March 31,
-----------------------------------
Increase (Decrease) in Net Assets: 2005 2004
==================================================================================================================
Operations
- ------------------------------------------------------------------------------------------------------------------
Investment income--net ............................. $ 14,493,634 $ 12,937,728
Realized gain--net ................................. 1,170 75,879
Change in unrealized appreciation/depreciation--net (1,036,662) (459,784)
-----------------------------------
Net increase in net assets resulting from operations 13,458,142 12,553,823
-----------------------------------
==================================================================================================================
Capital Transactions
- ------------------------------------------------------------------------------------------------------------------
Proceeds from contributions ........................ 4,985,746,126 5,445,099,631
Fair value of withdrawals .......................... (5,256,876,237) (5,848,609,190)
-----------------------------------
Net decrease in net assets derived from capital
transactions ...................................... (271,130,111) (403,509,559)
-----------------------------------
==================================================================================================================
Net Assets
- ------------------------------------------------------------------------------------------------------------------
Total decrease in net assets ....................... (257,671,969) (390,955,736)
Beginning of year .................................. 1,194,238,218 1,585,193,954
-----------------------------------
End of year ........................................ $ 936,566,249 $ 1,194,238,218
===================================
See Notes to Financial Statements.
WCMA GOVERNMENT SECURITIES FUND MARCH 31, 2005 21
Financial Highlights Master Government Securities Trust
For the Year Ended For the Period
March 31, February 13, 2003+
The following ratios have been derived from ---------------------------- to March 31,
information provided in the financial statements. 2005 2004 2003
===========================================================================================================================
Total Investment Return
- ---------------------------------------------------------------------------------------------------------------------------
Total investment return ......................... 1.44% .94% .75%*
================================================
===========================================================================================================================
Ratios to Average Net Assets
- ---------------------------------------------------------------------------------------------------------------------------
Expenses ........................................ .25% .22% .26%*
================================================
Investment income and realized gain--net ........ 1.39% .94% 1.08%*
================================================
===========================================================================================================================
Supplemental Data
- ---------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) ........ $ 936,566 $1,194,238 $1,585,194
================================================
* Annualized.
+ Commencement of operations.
See Notes to Financial Statements.
22 WCMA GOVERNMENT SECURITIES FUND MARCH 31, 2005
Notes to Financial Statements Master Government Securities Trust
1. Significant Accounting Policies:
Master Government Securities Trust (the "Trust") is registered under the
Investment Company Act of 1940, as amended, and is organized as a Delaware
statutory trust. The Declaration of Trust permits the Trustees to issue
nontransferable interest in the Trust, subject to certain limitations. The
Trust's financial statements are prepared in conformity with U.S. generally
accepted accounting principles, which may require the use of management accruals
and estimates. Actual results may differ from the estimates. The following is a
summary of significant accounting policies followed by the Trust.
(a) Valuation of investments -- Portfolio securities with remaining maturities
of greater than sixty days, for which market quotations are readily available,
are valued at market value. As securities transition from sixty-one to sixty
days to maturity, the difference between the valuation existing on the
sixty-first day before maturity and maturity value is amortized on a
straight-line basis to maturity. Securities maturing sixty days or less from
their date of acquisition are valued at amortized cost, which approximates
market value. For the purpose of valuation, the maturity of a variable rate
security is deemed to be the next coupon date on which the interest rate is to
be adjusted. Other investments and assets for which market quotations are not
available are valued at fair value as determined in good faith by or under the
direction of the Trust's Board of Trustees.
(b) Repurchase agreements -- The Trust may invest in U.S. government securities
pursuant to repurchase agreements. Under such agreements, the counterparty
agrees to repurchase the security at a mutually agreed upon time and price. The
Trust takes possession of the underlying securities, marks-to-market such
securities and, if necessary, receives additional securities daily to ensure
that the contract is fully collateralized. If the counterparty defaults and the
fair value of the collateral declines, liquidation of the collateral by the
Trust may be delayed or limited.
(c) Income taxes -- The Trust is classified as a partnership for federal income
tax purposes. As such, each investor in the Trust is treated as owner of its
proportionate share of the net assets, income, expenses and realized and
unrealized gains and losses of the Trust. Therefore, no federal income tax
provision is required. It is intended that the Trust's assets will be managed so
an investor in the Trust can satisfy the requirements of subchapter M of the
Internal Revenue Code.
(d) Security transactions and investment income -- Security transactions are
recorded on the dates the transactions are entered into (the trade dates).
Realized gains and losses on security transactions are determined on the
identified cost basis. Interest income (including amortization of premium and
discount) is recognized on the accrual basis.
2. Investment Advisory Agreement and Transactions with Affiliates:
The Trust has entered into an Investment Advisory Agreement with Fund Asset
Management, L.P. ("FAM"). The general partner of FAM is Princeton Services, Inc.
("PSI"), an indirect, wholly-owned subsidiary of Merrill Lynch & Co., Inc. ("ML
& Co."), which is the limited partner.
FAM is responsible for the management of the Trust's portfolio and provides the
necessary personnel, facilities, equipment and certain other services necessary
to the operations of the Trust. For such services, the Trust pays a monthly fee
based upon the average daily value of the Trust's net assets, at the following
annual rates: .25% of the Trust's average daily net assets not exceeding $500
million; .175% of the average daily net assets in excess of $500 million but not
exceeding $1 billion; and .125% of the average daily net assets in excess of $1
billion.
For the year ended March 31, 2005, the Trust reimbursed FAM $22,323 for certain
accounting services.
Certain officers and/or trustees of the Trust are officers and/or directors of
FAM, PSI, and/or ML & Co.
WCMA GOVERNMENT SECURITIES FUND MARCH 31, 2005 23
Report of Independent Registered Public Accounting Firm
Master Government Securities Trust
To the Investors and Board of Trustees of
Master Government Securities Trust:
We have audited the accompanying statement of assets and liabilities, including
the schedule of investments, of Master Government Securities Trust as of March
31, 2005, and the related statement of operations for the year then ended, the
statements of changes in net assets for each of the two years in the period then
ended and the financial highlights for each of the respective periods then
ended. These financial statements and financial highlights are the
responsibility of the Trust's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with 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. The Trust
is not required to have, nor were we engaged to perform, an audit of internal
control over financial reporting. Our audits 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 Trust'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, assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. Our procedures included confirmation of
securities owned as of March 31, 2005, by correspondence with the custodian. We
believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of Master
Government Securities Trust as of March 31, 2005, the results of its operations
for the year then ended, the changes in its net assets for each of the two years
in the period then ended and its financial highlights for each of the respective
periods then ended, in conformity with U.S. generally accepted accounting
principles.
Deloitte & Touche LLP
Princeton, New Jersey
May 20, 2005
24 WCMA GOVERNMENT SECURITIES FUND MARCH 31, 2005
Officers and Trustees
Number of
Portfolios in Other Public
Position(s) Length of Fund Complex Directorships
Held with Time Overseen by Held by
Name Address & Age Fund/Trust Served Principal Occupation(s) During Past 5 Years Trustee Trustee
====================================================================================================================================
Interested Trustee
- ------------------------------------------------------------------------------------------------------------------------------------
Robert C. P.O. Box 9011 President 2005 to President of MLIM/FAM-advised funds since 2005; 124 Funds None
Doll, Jr.* Princeton, NJ and present President of MLIMand FAM since 2001; Co-Head 163 Portfolios
08543-9011 Trustee (Americas Region) thereof from 2000 to 2001 and
Age: 50 Senior Vice President from 1999 to 2001; President
and Director of Princeton Services, Inc. ("Princeton
Services") since 2001; President of Princeton
Administrators, L.P. ("Princeton Administrators") since
2001; Chief Investment Officer of Oppenheimer
Funds, Inc. in 1999 and Executive Vice President
thereof from 1991 to 1999.
------------------------------------------------------------------------------------------------------------------------
* Mr. Doll is a director, trustee or member of an advisory board of certain other investment companies for which MLIM or
FAM acts as investment adviser. Mr. Doll is an "interested person," as defined in the Investment Company Act, of the
Fund based on his current positions with MLIM, FAM, Princeton Services and Princeton Administrators, L.P. Trustees
serve until their resignation, removal or death, or until December 31 of the year in which they turn 72. As Fund/Trust
President, Mr. Doll serves at the pleasure of the Board of Trustees.
====================================================================================================================================
Independent Trustees*
- ------------------------------------------------------------------------------------------------------------------------------------
Ronald W. P.O. Box 9095 Trustee 2003 to Professor Emeritus of Finance, School of Business, 48 Funds None
Forbes Princeton, NJ present State University of New York at Albany since 2000 48 Portfolios
08543-9095 and Professor thereof from 1989 to 2000; Consultant,
Age: 64 Urban Institute from 1995 to 1999.
- ------------------------------------------------------------------------------------------------------------------------------------
Cynthia A. P.O. Box 9095 Trustee 2003 to Professor, Harvard Business School since 1989; 48 Funds Newell
Montgomery Princeton, NJ present Associate Professor, J.L. Kellogg Graduate School of 48 Portfolios Rubbermaid,
08543-9095 Management, Northwestern University from 1985 Inc. (manu-
Age: 52 to 1989; Associate Professor, Graduate School of facturing)
Business Administration, University of Michigan
from 1979 to 1985; Director, Harvard Business
School of Publishing since 2005.
- ------------------------------------------------------------------------------------------------------------------------------------
Jean Margo P.O. Box 9095 Trustee 2004 to Self-employed consultant since 2001; Counsel of 48 Funds None
Reid Princeton, NJ present Alliance Capital Management (investment adviser) 48 Portfolios
08543-9095 in 2000; General Counsel, Director and Secretary of
Age: 59 Sanford C. Bernstein & Co., Inc. (investment adviser/
broker-dealer) from 1997 to 2000; Secretary, Sanford
C. Bernstein Fund, Inc. from 1994 to 2000; Director
and Secretary of SCB, Inc. since 1998; Director
and Secretary of SCB Partners, Inc. since 2000;
Director of Covenant House from 2001 to 2004.
- ------------------------------------------------------------------------------------------------------------------------------------
Roscoe S. P.O. Box 9095 Trustee 2003 to President, Middle East Institute from 1995 to 48 Funds None
Suddarth Princeton, NJ present 2001; Foreign Service Officer, United States 48 Portfolios
08543-9095 Foreign Service from 1961 to 1995; Career
Age: 69 Minister, from 1989 to 1995; Deputy Inspector
General, U.S. Department of State from 1991
to 1994; U.S. Ambassador to the Hashemite
Kingdom of Jordan from 1987 to 1990.
- ------------------------------------------------------------------------------------------------------------------------------------
WCMA GOVERNMENT SECURITIES FUND MARCH 31, 2005 25
Officers and Trustees (continued)
Number of
Portfolios in Other Public
Position(s) Length of Fund Complex Directorships
Held with Time Overseen by Held by
Name Address & Age Fund/Trust Served Principal Occupation(s) During Past 5 Years Trustee Trustee
====================================================================================================================================
Independent Trustees* (concluded)
- ------------------------------------------------------------------------------------------------------------------------------------
Richard R. P.O. Box 9095 Trustee 1997 to Professor of Finance from 1984 to 1995, Dean from 48 Funds Bowne &
West Princeton, NJ present 1984 to 1993 and since 1995 Dean Emeritus of 48 Portfolios Co., Inc.
08543-9095 New York University Leonard N. Stern School of (financial
Age: 67 Business Administration. printers);
Vornado
Realty Trust
(real estate
company);
Alexander's,
Inc. (real
estate
company)
- ------------------------------------------------------------------------------------------------------------------------------------
Edward D. P.O. Box 9095 Trustee 2003 to Self-employed financial consultant since 1994; 48 Funds None
Zinbarg Princeton, NJ present Executive Vice President of The Prudential 48 Portfolios
08543-9095 Insurance Company of America from 1988 to
Age: 70 1994; former Director of Prudential Reinsurance
Company and former Trustee of The Prudential
Foundation.
------------------------------------------------------------------------------------------------------------------------
* Trustees serve until their resignation, removal or death, or until December 31 of the year in which they turn 72.
- ------------------------------------------------------------------------------------------------------------------------------------
26 WCMA GOVERNMENT SECURITIES FUND MARCH 31, 2005
Officers and Trustees (concluded)
Position(s) Length of
Held with Time
Name Address & Age Fund/Trust Served Principal Occupation(s) During Past 5 Years
====================================================================================================================================
Fund Officers*
- ------------------------------------------------------------------------------------------------------------------------------------
Donald C. P.O. Box 9011 Vice 2002 to First Vice President of MLIM and FAM since 1997 and Treasurer thereof since 1999;
Burke Princeton, NJ President present Senior Vice President and Treasurer of Princeton Services since 1999 and Director
08543-9011 and since 2004; Vice President of FAMD since 1999; Vice President of MLIMand FAM from
Age: 44 Treasurer 1990 to 1997; Director of Taxation of MLIM from 1990 to 2001; Vice President,
Treasurer and Secretary of the IQ Funds since 2004.
- ------------------------------------------------------------------------------------------------------------------------------------
John Ng P.O. Box 9011 Vice 2002 to Director of MLIM since 2000; Vice President of MLIM from 1984 to 2000.
Princeton, NJ President present
08543-9011
Age: 51
- ------------------------------------------------------------------------------------------------------------------------------------
Jeffrey P.O. Box 9011 Chief 2004 to Chief Compliance Officer of the MLIM/FAM-advised funds and First Vice President and
Hiller Princeton, NJ Compliance present Chief Compliance Officer of MLIM (Americas Region) since 2004; Chief Compliance
08543-9011 Officer Officer of the IQ Funds since 2004; Global Director of Compliance at Morgan Stanley
Age: 53 Investment Management from 2002 to 2004; Managing Director and Global Director of
Compliance at Citigroup Asset Management from 2000 to 2002; Chief Compliance
Management in 2000; Chief Compliance Officer at Prudential Financial from 1995 to
2000; Senior Counsel in the Commission's Division of Enforcement from 1990 to 1995.
- ------------------------------------------------------------------------------------------------------------------------------------
Alice A. P.O. Box 9011 Secretary 2004 to Director (Legal Advisory) of MLIM since 2002; Vice President of MLIM from 1999 to
Pellegrino Princeton, NJ present 2002; Attorney associated with MLIM since 1997; Secretary of MLIM, FAM, FAMD and
08543-9011 Princeton Services since 2004.
Age: 45
------------------------------------------------------------------------------------------------------------------------
* Officers of the Fund/Trust serve at the pleasure of the Board of Trustees.
- ------------------------------------------------------------------------------------------------------------------------------------
Further information about the Fund's Officers and Trustees is available in the Fund's Statement of Additional
Information, which can be obtained without charge by calling 1-800-MER-FUND.
- ------------------------------------------------------------------------------------------------------------------------------------
Custodian
State Street Bank and Trust Company
P.O. Box 351
Boston, MA 02101
Transfer Agent
Financial Data Services, Inc.
4800 Deer Lake Drive East
Jacksonville, FL 32246-6484
800-221-7210*
* For inquiries regarding your WCMA account, call 800-262-4636.
- --------------------------------------------------------------------------------
Effective January 1, 2005, Terry K. Glenn, President and Trustee and Kevin A.
Ryan, Trustee of WCMA Government Securities Fund and Master Government
Securities Trust retired. The Fund's/Trust's Board of Trustees wishes Messrs.
Glenn and Ryan well in their retirements.
Effective January 1, 2005, Robert C. Doll, Jr. became President and Trustee of
the Fund and the Trust.
- --------------------------------------------------------------------------------
WCMA GOVERNMENT SECURITIES FUND MARCH 31, 2005 27
[LOGO] Merrill Lynch Investment Managers
www.mlim.ml.com
- --------------------------------------------------------------------------------
Mercury Advisors
A Division of Merrill Lynch Investment Managers
www.mercury.ml.com
This report is not authorized for use as an offer of sale or a solicitation of
an offer to buy shares of the Fund unless accompanied or preceded by the Fund's
current prospectus. An investment in the Fund is not insured or guaranteed by
the Federal Deposit Insurance Corporation or any other government agency.
Although the Fund seeks to preserve the value of your investment at $1.00 per
share, it is possible to lose money by investing in the Fund. Past performance
results shown in this report should not be considered a representation of future
performance, which will fluctuate. Statements and other information herein are
as dated and are subject to change.
A description of the policies and procedures that the Fund uses to determine how
to vote proxies relating to portfolio securities is available (1) without
charge, upon request, by calling toll-free 1-800-MER-FUND (1-800-637-3863); (2)
at www.mutualfunds.ml.com; and (3) on the Securities and Exchange Commission's
Web site at http://www.sec.gov. Information about how the Fund voted proxies
relating to securities held in the Fund's portfolio during the most recent
12-month period ended June 30 is available (1) at www.mutualfunds.ml.com and (2)
on the Securities and Exchange Commission's Web site at http://www.sec.gov.
WCMA Government Securities Fund
Box 9011
Princeton, NJ
08543-9011
#WCMAGS -- 3/05
Item 2 - Code of Ethics - The registrant has adopted a code of ethics, as of the
end of the period covered by this report, that applies to the
registrant's principal executive officer, principal financial officer
and principal accounting officer, or persons performing similar
functions. A copy of the code of ethics is available without charge
upon request by calling toll-free 1-800-MER-FUND (1-800-637-3863).
Item 3 - Audit Committee Financial Expert - The registrant's board of directors
has determined that (i) the registrant has the following audit
committee financial experts serving on its audit committee and (ii)
each audit committee financial expert is independent: (1) Ronald W.
Forbes, (2) Richard R. West, and (3) Edward D. Zinbarg.
Item 4 - Principal Accountant Fees and Services
WCMA Government Securities Fund
(a) Audit Fees - Fiscal Year Ending March 31, 2005 - $6,500
Fiscal Year Ending March 31, 2004 - $6,200
(b) Audit-Related Fees - Fiscal Year Ending March 31, 2005 - $0
Fiscal Year Ending March 31, 2004 - $0
(c) Tax Fees - Fiscal Year Ending March 31, 2005 - $6,300
Fiscal Year Ending March 31, 2004 - $5,800
The nature of the services include tax compliance, tax advice and tax
planning.
(d) All Other Fees - Fiscal Year Ending March 31, 2005 - $0
Fiscal Year Ending March 31, 2004 - $0
Master Government Securities Trust
(a) Audit Fees - Fiscal Year Ending March 31, 2005 - $28,000
Fiscal Year Ending March 31, 2004 - $27,000
(b) Audit-Related Fees - Fiscal Year Ending March 31, 2005 - $0
Fiscal Year Ending March 31, 2004 - $0
(c) Tax Fees - Fiscal Year Ending March 31, 2005 - $8,700
Fiscal Year Ending March 31, 2004 - $8,000
The nature of the services include tax compliance, tax advice and tax
planning.
(d) All Other Fees - Fiscal Year Ending March 31, 2005 - $0
Fiscal Year Ending March 31, 2004 - $0
(e)(1) The registrant's audit committee (the "Committee") has adopted
policies and procedures with regard to the pre-approval of services.
Audit, audit-related and tax compliance services provided to the
registrant on an annual basis require specific pre-approval by the
Committee. The Committee also must approve other non-audit services
provided to the registrant and those non-audit services provided to the
registrant's affiliated service providers that relate directly to the
operations and the financial reporting of the registrant. Certain of
these non-audit services that the Committee believes are a) consistent
with the SEC's auditor independence rules and b) routine and recurring
services that will not impair the independence of the independent
accountants may be approved by the Committee without consideration on a
specific case-by-case basis ("general pre-approval"). However, such
services will only be deemed pre-approved provided that any individual
project does not exceed $5,000 attributable to the registrant or
$50,000 for all of the registrants the Committee oversees. Any proposed
services exceeding the pre-approved cost levels will require specific
pre-approval by the Committee, as will any other services not subject
to general pre-approval (e.g., unanticipated but permissible services).
The Committee is informed of each service approved subject to general
pre-approval at the next regularly scheduled in-person board meeting.
(e)(2) 0%
(f) Not Applicable
(g) Fiscal Year Ending March 31, 2005 - $10,018,400
Fiscal Year Ending March 31, 2004 - $16,708,160
(h) The registrant's audit committee has considered and determined that
the provision of non-audit services that were rendered 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 that were not pre-approved pursuant
to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible
with maintaining the principal accountant's independence.
Regulation S-X Rule 2-01(c)(7)(ii) - $945,000, 0%
Item 5 - Audit Committee of Listed Registrants - Not Applicable
Item 6 - Schedule of Investments - Not Applicable
Item 7 - Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies - Not Applicable
Item 8 - Portfolio Managers of Closed-End Management Investment Companies - Not
Applicable
Item 9 - Purchases 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
11(a) - The registrant's certifying officers have reasonably designed such
disclosure controls and procedures to ensure material information
relating to the registrant is made known to us by others particularly
during the period in which this report is being prepared. The
registrant's certifying officers have determined that the registrant's
disclosure controls and procedures are effective based on our evaluation
of these controls and procedures as of a date within 90 days prior to
the filing date of this report.
11(b) - There were no changes in the registrant's internal control over
financial reporting (as defined in Rule 30a-3(d) under the Act (17 CFR
270.30a-3(d)) that occurred during the second fiscal half-year of the
period covered by this report that has materially affected, or is
reasonably likely to materially affect, the registrant's internal
control over financial reporting.
Item 12 - Exhibits attached hereto
12(a)(1) - Code of Ethics - See Item 2
12(a)(2) - Certifications - Attached hereto
12(a)(3) - Not Applicable
12(b) - Certifications - Attached hereto
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
WCMA Government Securities Fund and Master Government Securities Trust
By: /s/ Robert C. Doll, Jr.
---------------------------
Robert C. Doll, Jr.,
Chief Executive Officer of
WCMA Government Securities Fund and Master Government Securities Trust
Date: May 23, 2005
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By: /s/ Robert C. Doll, Jr.
---------------------------
Robert C. Doll, Jr.,
Chief Executive Officer of
WCMA Government Securities Fund and Master Government Securities Trust
Date: May 23, 2005
By: /s/ Donald C. Burke
---------------------------
Donald C. Burke,
Chief Financial Officer of
WCMA Government Securities Fund and Master Government Securities Trust
Date: May 23, 2005