N-CSR 1 cmtancsr.txt 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: 811-2380 The Cash Management Trust of America (Exact Name of Registrant as specified in charter) 333 South Hope Street Los Angeles, California 90071 (Address of principal executive offices) Registrant's telephone number, including area code: (213) 486-9200 Date of fiscal year end: September 30, 2005 Date of reporting period: March 31, 2005 Julie F. Williams Capital Research and Management Company 333 South Hope Street Los Angeles, California 90071 (name and address of agent for service) Copies to: Michael Glazer Paul, Hastings, Janofsky & Walker LLP 515 South Flower Street Los Angeles, California 90071 (Counsel for the Registrant) ITEM 1 - Reports to Stockholders [logo - AMERICAN FUNDS(R)] The right choice for the long term(R) THE CASH MANAGEMENT TRUST OF AMERICA THE U.S. TREASURY MONEY FUND OF AMERICA THE TAX-EXEMPT MONEY FUND OF AMERICA [cover illustration: abstract of three men, dressed in suits, carrying geometric shapes and placing the shapes into similarly shaped cut-outs in the floor] Semi-annual report for the six months ended March 31, 2005 THE CASH MANAGEMENT TRUST OF AMERICA(R) seeks to provide income on cash reserves, while preserving capital and maintaining liquidity, through investments in high-quality short-term money market instruments. THE U.S. TREASURY MONEY FUND OF AMERICA (SM) seeks to provide income on cash reserves, while preserving capital and maintaining liquidity, through investments in U.S. Treasury securities maturing in one year or less. THE TAX-EXEMPT MONEY FUND OF AMERICA (SM) seeks to provide income free from federal taxes, while preserving capital and maintaining liquidity, through investments in high-quality municipal securities with effective maturities of one year or less. These money market funds are three of the 29 American Funds. The organization ranks among the nation's three largest mutual fund families. For more than seven decades, Capital Research and Management Company,SM the American Funds adviser, has invested with a long-term focus based on thorough research and attention to risk. FIGURES SHOWN ARE PAST RESULTS FOR CLASS A SHARES AND ARE NOT PREDICTIVE OF RESULTS IN FUTURE PERIODS. CURRENT AND FUTURE RESULTS MAY BE LOWER OR HIGHER THAN THOSE SHOWN. INVESTMENT RETURNS WILL VARY. ALTHOUGH THE FUNDS SEEK TO PRESERVE THE VALUE OF YOUR INVESTMENT AT $1.00 PER SHARE, IT IS POSSIBLE TO LOSE MONEY BY INVESTING IN THE FUNDS. INVESTING FOR SHORT PERIODS MAKES LOSSES MORE LIKELY. INVESTMENTS ARE NOT FDIC-INSURED, NOR ARE THEY DEPOSITS OF OR GUARANTEED BY A BANK OR ANY OTHER ENTITY. FOR THE MOST CURRENT INFORMATION AND MONTH-END RESULTS, VISIT AMERICANFUNDS.COM. The fund's investment adviser is waiving a portion of its management fees for The U.S. Treasury Money Fund of America and The Tax-Exempt Money Fund of America. Results shown reflect the waiver, without which they would have been lower. Please see the funds' Financial Highlights tables on pages 44 and 64, respectively, for details. Results for share classes B, C, F and 529 of The Cash Management Trust of America can be found on page 26. Please see the inside back cover for important information about share classes. The return of principal for the bond holdings in The Cash Management Trust of America, The U.S. Treasury Money Fund of America and The Tax-Exempt Money Fund of America is not guaranteed. Fund shares are subject to the same interest rate, inflation and credit risks associated with the underlying bond holdings. Income from The Tax-Exempt Money Fund of America may be subject to state or local income taxes and/or federal alternative minimum taxes. Certain other income may be taxable. [illustration: abstract of three men, dressed in suits, carrying geometric shapes and placing the shapes into similarly shaped cut-outs in the floor] FELLOW SHAREHOLDERS: During the first half of the money market funds' fiscal year, the U.S. economy continued to expand, and the Federal Reserve Board responded by pushing up interest rates. In this environment, the yields and the returns on The Cash Management Trust of America, The U.S. Treasury Money Fund of America and The Tax-Exempt Money Fund of America rose consistently during the six-month period ended March 31, 2005. All three funds maintained a constant net asset value of $1.00. THE FUNDS' RESULTS THE CASH MANAGEMENT TRUST OF AMERICA produced an income return of 0.84% (1.68% annualized), with dividends reinvested, for the six-month period ended March 31, 2005. The fund's annualized seven-day yield as of March 31 was 2.12%. THE U.S. TREASURY MONEY FUND OF AMERICA generated a six-month income return of 0.69% (1.38% annualized), including reinvested dividends. Because all of the fund's earnings are derived from investments in U.S. Treasury securities, the income paid by the fund is exempt from state and local taxes. The fund's annualized seven-day yield for the week ended March 31, 2005, was 1.98%. THE TAX-EXEMPT MONEY FUND OF AMERICA provided a federally tax-free income return of 0.61% (1.22% annualized), with dividends reinvested, for the first half of the fund's fiscal year. The income return for the six months is equivalent to a taxable return of 0.94% (1.88% annualized) for investors in the 35.0% tax bracket. A portion of the return may also be exempt from some state and local taxes. The fund's annualized seven-day yield at the end of the period was 1.52%, and its taxable equivalent annualized seven-day yield was 2.34%. SEVEN-DAY YIELD: The seven-day yield is the annualized dividends paid by a fund during that seven-day period. The seven-day yield for the week ending March 31, 2005, shows the earnings rate at the end of the funds' fiscal period and reflects the rise in interest rates over the same six-month period. RISING INFLATION, RISING INTEREST RATES During the past year, the price of oil rose to historic levels. This has resulted in higher consumer prices. The core CPI, which excludes food and energy (items prone to volatile price swings), rose at a 2.6% seasonally adjusted annual rate for the six-month period ended March 31, 2005. Including food and energy, the CPI rose at a 3.8% seasonally adjusted annual rate for the same period. [Begin Sidebar] CONSUMER PRICE INDEX AND FEDERAL FUNDS TARGET RATE VS. FUND YIELDS(1) For the five years ended March 31, 2005 (plotted monthly) [begin line chart]
The Federal Tax-Exempt The U.S. Treasury Consumer Price Funds Rate Money Fund Cash Management Money Fund Index (inflation, (target rate) of America (2) Trust of America of America (3) seasonally adjusted) Mar-00 6.00 4.49 5.46 5.08 3.8 Apr-00 6.00 5.35 5.48 5.07 3.0 May-00 6.50 5.45 5.65 5.05 3.1 Jun-00 6.50 5.82 6.06 5.20 3.7 Jul-00 6.50 5.40 5.99 5.21 3.6 Aug-00 6.50 5.55 6.04 5.60 3.4 Sep-00 6.50 5.89 6.06 5.64 3.5 Oct-00 6.50 5.48 6.11 5.44 3.5 Nov-00 6.50 5.85 5.97 5.36 3.4 Dec-00 6.50 5.68 5.94 5.12 3.4 Jan-01 5.50 4.55 5.39 5.15 3.7 Feb-01 5.50 3.98 5.01 4.71 3.5 Mar-01 5.00 4.48 4.67 4.37 3.0 Apr-01 4.50 4.69 4.24 3.65 3.3 May-01 4.00 4.29 3.67 3.42 3.6 Jun-01 3.75 3.88 3.28 3.17 3.3 Jul-01 3.75 3.45 3.19 2.89 2.7 Aug-01 3.50 3.15 3.09 2.96 2.8 Sep-01 3.00 2.89 2.71 2.59 2.6 Oct-01 2.50 2.55 1.98 2.05 2.1 Nov-01 2.00 2.20 1.65 1.60 1.9 Dec-01 1.75 1.83 1.33 1.25 1.5 Jan-02 1.75 1.35 1.17 1.13 1.2 Feb-02 1.75 1.32 1.14 1.10 1.1 Mar-02 1.75 1.25 1.17 1.14 1.4 Apr-02 1.75 1.68 1.25 1.16 1.6 May-02 1.75 1.71 1.26 1.12 1.2 Jun-02 1.75 1.45 1.13 1.09 1.0 Jul-02 1.75 1.29 1.16 1.06 1.5 Aug-02 1.75 1.25 1.15 1.13 1.7 Sep-02 1.75 1.46 1.15 1.10 1.5 Oct-02 1.75 1.52 1.21 1.08 2.0 Nov-02 1.25 1.35 1.00 0.87 2.2 Dec-02 1.25 1.04 0.78 0.71 2.4 Jan-03 1.25 0.79 0.77 0.59 2.6 Feb-03 1.25 0.80 0.89 0.58 3.0 Mar-03 1.25 0.61 0.99 0.58 3.1 Apr-03 1.25 0.88 0.85 0.57 2.3 May-03 1.25 0.88 0.88 0.55 2.1 Jun-03 1.00 0.91 0.68 0.46 2.1 Jul-03 1.00 0.63 0.84 0.42 2.1 Aug-03 1.00 0.51 1.05 0.38 2.2 Sep-03 1.00 0.63 1.06 0.42 2.3 Oct-03 1.00 0.60 0.89 0.37 2.0 Nov-03 1.00 0.68 0.77 0.29 1.8 Dec-03 1.00 0.72 0.73 0.25 1.9 Jan-04 1.00 0.45 0.59 0.17 2.0 Feb-04 1.00 0.85 0.63 0.30 1.7 Mar-04 1.00 0.66 0.60 0.30 1.7 Apr-04 1.00 0.74 0.67 0.39 2.3 May-04 1.00 0.82 0.73 0.29 3.0 Jun-04 1.25 0.88 0.67 0.39 3.2 Jul-04 1.25 0.88 1.03 0.49 2.9 Aug-04 1.50 0.98 1.42 0.76 2.7 Sep-04 1.75 1.12 1.51 0.88 2.5 Oct-04 1.75 1.54 1.47 1.04 3.2 Nov-04 2.00 1.88 1.50 1.13 3.6 Dec-04 2.25 1.98 1.69 1.43 3.4 Jan-05 2.25 1.85 1.76 1.48 2.9 Feb-05 2.50 2.26 1.89 1.64 2.9 Mar-05 2.75 2.34 2.12 1.98 3.2
[end line chart] YOUR FUNDS' ANNUALIZED SEVEN-DAY SEC YIELDS AS OF MARCH 31, 2005 The Cash Management Trust of America +2.12% The U.S. Treasury Money Fund of America +1.98% (reflecting a fee waiver, +1.96% without the waiver) The Tax-Exempt Money Fund of America +1.52% (reflecting a fee waiver, +1.50% without the waiver) The Tax-Exempt Money Fund of America (taxable equivalent yield)(2) +2.34% (reflecting a fee waiver, +2.31% without the waiver) The seven-day SEC yields more accurately reflect the funds' current earnings than do their 30-day yields or total returns. The fund's investment adviser is waiving a portion of its management fees for The U.S. Treasury Money Fund of America and The Tax-Exempt Money Fund of America. Results shown reflect the waiver, without which they would have been lower. Please see the funds' Financial Highlights tables on pages 44 and 64, respectively, for details. (1) Equivalent to Securities and Exchange Commission (SEC) yields. Represents the 7-day month-end averages. (2) Represents the fund's taxable equivalent yield calculated at the maximum effective 35.0% federal tax rate. (3) Because income paid by The U.S. Treasury Money Fund of America is exempt from state and local taxes in most states, the fund's taxable equivalent yield would be higher than the rates shown in the chart. [End Sidebar] The outlook for continued economic growth and concerns about future gains in inflation are good indicators that the Federal Reserve Board will continue the pace of interest-rate increases. Since June 2004, the Fed has been steadily raising the target federal funds rate (the rate banks charge each other for overnight loans) in its effort to diminish the stimulative effect of low interest rates. Since the start of the funds' fiscal year, the target rate has been raised five times -- most recently on May 3 -- bringing it to 3.00%. Any increase in the federal funds rate is quickly reflected in the yields on the three money market funds. (The chart on page 2 demonstrates the interplay between the federal funds rate and the funds' yields.) The Cash Management Trust of America invests a significant portion of its portfolio in high-quality, short-term commercial paper; The U.S. Treasury Money Fund of America invests entirely in U.S. Treasury bills; and The Tax-Exempt Money Fund of America invests in short-term municipal securities. Since the average maturities of the three funds range from 23 to 43 days, further federal funds rate increases will quickly boost yields in the funds. THE FUNDS' OBJECTIVE Our foremost objective in managing these money market funds is to protect our shareholders' principal, while providing a reasonable income return. Because of the stability and convenience they provide, American Funds money market funds can play a valuable role in your overall financial plan. Many investors have used the funds as a holding place for money targeted for emergencies or short-term goals, or designated to move into equity or fixed-income funds through a regular investment program. Check-writing privileges and 24-hour access to your funds through American FundsLine(R) (800/325-3590) and the American Funds website (americanfunds.com) make these funds convenient holding places for your cash, regardless of your goal. Thank you for selecting an American Funds money market fund for your investment portfolio. As always, we appreciate the confidence you have placed in us and look forward to helping you meet your long-term financial goals. Cordially, /s/ Paul G. Haaga. Jr. /s/ Abner D. Goldstine Paul G. Haaga, Jr. Abner D. Goldstine Chairman of the Boards President May 11, 2005 For current information about the funds, visit americanfunds.com. CASH MANAGEMENT TRUST OF AMERICA Investment portfolio unaudited March 31, 2005 [begin pie chart] CASH MANAGEMENT TRUST OF AMERICA Commercial paper 76.81% Federal agency discount notes 14.67 U.S. Treasuries 5.10 Certificates of deposit 3.40 Other assets less liabilities 0.02 [end pie chart] THE CASH MANAGEMENT TRUST OF AMERICA Investment portfolio, March 31, 2005 Principal Market Yield at amount value Short-term securities - 99.98% acquisition (000) (000) Certificates of deposit - 3.40% Toronto-Dominion Bank April 6, 2005 2.64% $ 50,000 $ 50,000 May 16, 2005 2.83 50,000 49,997 Wells Fargo Bank, N.A. May 10, 2005 2.81 100,000 100,000 May 12, 2005 2.81 100,000 100,000 Total certificates of deposit 299,997 Commercial paper - 76.81% 3M Co. May 19, 2005 2.79 30,000 29,889 Abbott Laboratories Inc. (1) April 26, 2005 2.66 50,000 49,904 May 3, 2005 2.75 40,000 39,899 Alcon Capital Corp (1) April 7, 2005 2.57 50,000 49,975 Allied Irish Banks N.A. Inc. (1) April 8, 2005 2.66 50,000 49,971 American Express Credit Corp. April 20, 2005 2.76 50,000 49,924 American Honda Finance Corp. April 11, 2005 2.60 25,000 24,980 April 18, 2005 2.62 50,000 49,938 April 26, 2005 2.70 25,000 24,951 May 6, 2005 2.72 50,000 49,869 Amsterdam Funding Corp. (1) April 6, 2005 2.60 50,000 49,978 April 25, 2005 2.69 50,000 49,907 Anheuser-Busch Cos. Inc. (1) April 4, 2005 2.52 50,000 49,990 Bank of America Corp. April 18, 2005 2.65 65,000 64,918 May 2, 2005 2.75 100,000 99,762 May 6, 2005 2.82 35,000 34,902 Bank of Ireland (1) April 4, 2005 2.60 50,000 49,986 April 8, 2005 2.60 50,000 49,971 Bank of Nova Scotia May 2, 2005 2.71 50,000 49,880 Barclays U.S. Funding LLC April 5, 2005 2.59 50,000 49,982 April 11, 2005 2.60 50,000 49,960 May 4, 2005 2.79 50,000 49,869 Barton Capital LLC (1) April 22, 2005 2.72 75,000 74,876 BellSouth Corp. (1) April 4, 2005 2.64 25,000 24,993 April 7, 2005 2.63 50,000 49,974 April 11, 2005 2.59 50,000 49,961 BMW U.S. Capital LLC (1) April 22, 2005 2.65 50,000 49,919 April 27, 2005 2.76 50,000 49,897 BNP Paribas Finance Inc. April 5, 2005 2.58 50,000 49,982 April 15, 2005 2.62 50,000 49,946 CAFCO, LLC (1) April 14, 2005 2.64 55,000 54,944 April 25, 2005 2.73 145,000 144,726 Caisse d'Amortissement de la Dette Sociale April 18, 2005 2.61 50,000 49,935 April 29, 2005 2.68 50,000 49,892 Calyon North America Inc. May 6, 2005 2.75 50,000 49,863 May 17, 2005 2.83 50,000 49,816 Canadian Imperial Holdings Inc. April 15, 2005 2.62 50,000 49,946 May 31, 2005 2.90 50,000 49,755 Canadian Wheat Board April 21, 2005 2.62 25,000 24,962 Caterpillar Financial Services Corp. April 7, 2005 2.64 40,000 39,980 April 19, 2005 2.73 30,000 29,957 CBA (Delaware) Finance Inc. May 3, 2005 2.73 50,000 49,878 ChevronTexaco Funding Corp. April 5, 2005 2.53 100,000 99,965 Clipper Receivables Co., LLC (1) April 13, 2005 2.68 50,000 49,952 April 19, 2005 2.73 150,000 149,784 Coca-Cola Co. April 5, 2005 2.57 75,000 74,973 April 29, 2005 2.71 25,000 24,946 May 5, 2005 2.74 50,000 49,867 May 24, 2005 2.84 50,000 49,788 Colgate-Palmolive Co. (1) April 25, 2005 2.75 50,000 49,905 DaimlerChrysler Revolving Auto Conduit LLC I April 5, 2005 2.66 25,000 24,991 DaimlerChrysler Revolving Auto Conduit LLC II April 22, 2005 2.69 46,400 46,324 Danske Corp., Series A April 4, 2005 2.58 50,000 49,989 April 29, 2005 2.71 50,000 49,891 May 9, 2005 2.75 50,000 49,853 Dexia Delaware LLC April 1, 2005 2.64 50,000 49,996 April 15, 2005 2.64 50,000 49,945 DuPont (E.I.) de Nemours & Co. April 12, 2005 2.61 100,000 99,913 April 29, 2005 2.73 50,000 49,890 Emerson Electric Co. (1) April 18, 2005 2.75 25,000 24,966 Export Development Canada April 8, 2005 2.53 50,000 49,972 Exxon Asset Management Co. (1) May 20, 2005 2.76 50,000 49,809 FCAR Owner Trust I May 10, 2005 2.82 100,000 99,681 First Data Corp. April 6, 2005 2.64 25,000 24,989 Gannett Co. (1) April 19, 2005 2.65 100,000 99,860 May 18, 2005 2.80 50,000 49,814 General Electric Capital Corp. April 21, 2005 2.68 50,000 49,922 May 13, 2005 2.79 50,000 49,834 May 18, 2005 2.85 100,000 99,640 Harley-Davidson Funding Corp. (1) April 27, 2005 2.75 20,000 19,959 HBOS Treasury Services PLC April 8, 2005 2.61 50,000 49,975 April 18, 2005 2.65 50,000 49,934 Hershey Foods Corp. (1) May 3, 2005 2.76 25,000 24,937 Hewlett-Packard Co. (1) April 26, 2005 2.70 100,000 99,810 HSBC Finance Corp. April 11, 2005 2.62 100,000 99,927 May 16, 2005 2.87 50,000 49,817 International Business Machines Corp. May 6, 2005 2.76 100,000 99,724 ING (U.S.) Funding LLC April 1, 2005 2.62 50,000 49,996 April 26, 2005 2.70 50,000 49,903 IXIS Commercial Paper Corp. (1) April 21, 2005 2.69 125,000 124,804 KfW International Finance Inc. (1) April 14, 2005 2.59 150,000 149,860 Kimberly-Clark Worldwide Inc. (1) April 6, 2005 2.62 25,000 24,989 May 10, 2005 2.79 25,000 24,923 Lloyds TSB Bank PLC April 1, 2005 2.62 50,000 49,996 Nestle Capital Corp. (1) May 27, 2005 2.86 50,000 49,785 New Center Asset Trust Plus April 19, 2005 2.66 100,000 99,860 Old Line Funding, LLC (1) April 22, 2005 2.70 50,000 49,918 Park Avenue Receivables Co., LLC (1) April 12, 2005 2.66 125,000 124,889 May 9, 2005 2.83 75,000 74,771 PepsiCo Inc. (1) April 6, 2005 2.60 50,000 49,978 April 7, 2005 2.61 50,000 49,975 May 11, 2005 2.76 50,000 49,843 Pfizer Inc (1) May 20, 2005 2.86 50,000 49,802 Pitney Bowes Inc. (1) April 11, 2005 2.73 50,000 49,958 Private Export Funding Corp. (1) April 4, 2005 2.60 25,000 24,993 April 21, 2005 2.60 25,000 24,965 Procter & Gamble Co. (1) April 7, 2005 2.61 100,000 99,949 Shell Finance (U.K.) PLC May 18, 2005 2.83 75,000 74,718 Siemens Capital Co. LLC April 1, 2005 2.57 25,000 24,998 April 6, 2005 2.58 50,000 49,982 SLM Corp. (1) April 6, 2005 2.76 50,000 49,977 Spintab AB (Swedmortgage) April 7, 2005 2.59 50,000 49,975 Stadshypotek Delaware Inc. (1) April 12, 2005 2.63 35,000 34,969 Svenska Handelsbanken Inc. April 4, 2005 2.58 75,000 74,984 Three Pillars Funding, LLC (1) April 1, 2005 2.66 50,000 49,996 April 18, 2005 2.77 25,000 24,965 Thunder Bay Funding, LLC (1) April 1, 2005 2.59 25,000 24,998 April 20, 2005 2.66 36,155 36,102 Total Capital SA (1) May 23, 2005 2.84 100,000 99,586 Toyota Motor Credit Corp. April 11, 2005 2.60 30,000 29,976 May 23, 2005 2.88 45,000 44,814 Triple-A One Funding Corp. (1) April 1, 2005 2.67 30,000 29,998 April 8, 2005 2.63 50,000 49,971 UBS Finance (Delaware) LLC April 25, 2005 2.73 100,000 99,811 USAA Capital Corp. April 1, 2005 2.73 50,000 49,996 Variable Funding Capital Corp. (1) April 13, 2005 2.63 120,000 119,894 April 22, 2005 2.68 80,000 79,870 Wal-Mart Stores Inc. (1) April 5, 2005 2.60 50,000 49,982 May 3, 2005 2.73 125,000 124,688 Total commercial paper 6,771,556 Federal agency discount notes - 14.67% Fannie Mae May 11, 2005 2.79 50,000 49,842 Federal Farm Credit Banks April 1, 2005 2.49 35,200 35,198 April 6, 2005 2.49 15,000 14,994 April 8, 2005 2.53 50,000 49,972 April 26, 2005 2.68 50,000 49,904 Federal Home Loan Bank April 8, 2005 2.51 25,000 24,986 April 15, 2005 2.53 125,000 124,879 April 20, 2005 2.56 45,000 44,939 April 29, 2005 2.62 75,000 74,845 May 4, 2005 2.71 25,000 24,936 Freddie Mac April 15, 2005 2.63 25,000 24,973 April 20, 2005 2.58 125,000 124,829 May 4, 2005 2.74 100,000 99,742 May 25, 2005 2.83 50,000 49,766 International Bank for Reconstruction and Development April 4, 2005 2.57 50,000 49,986 April 13, 2005 2.58 100,000 99,907 April 26, 2005 2.52 50,000 49,902 May 17, 2005 2.75 50,000 49,821 Tennessee Valley Authority April 7, 2005 2.51 34,900 34,883 April 14, 2005 2.57 165,000 164,836 April 21, 2005 2.62 50,000 49,924 Total federal agency discount notes 1,293,064 U.S. Treasuries - 5.10% U.S. Treasury Bills April 14, 2005 2.54 100,000 99,903 April 21, 2005 2.70 50,000 49,923 April 28, 2005 2.57 200,000 199,627 May 5, 2005 2.61 100,000 99,764 Total U.S. Treasuries 449,217 TOTAL INVESTMENT SECURITIES (COST: $8,813,696,000) 8,813,834 Other assets less liabilities 1,495 NET ASSETS $8,815,329
(1) Restricted securities that can be resold only to institutional investors. In practice, these securities are typically as liquid as unrestricted securities in the portfolio. The total value of all restricted securities was $3,356,065, which represented 38.07% of the net assets of the fund. See Notes to Financial Statements FINANCIAL STATEMENTS STATEMENT OF ASSETS AND LIABILITIES unaudited at March 31, 2005 (dollars and shares in thousands, except per-share amounts) Assets: Investment securities at market (cost: $8,813,696) $8,813,834 Cash 2,125 Receivables for: Sales of fund's shares $61,791 Interest 212 62,003 8,877,962 Liabilities: Payables for: Repurchases of fund's shares 56,670 Dividends on fund's shares 342 Investment advisory services 2,078 Services provided by affiliates 3,418 Deferred Trustees' compensation 59 Other fees and expenses 66 62,633 Net assets at March 31, 2005 $8,815,329 Net assets consist of: Capital paid in on shares of beneficial interest $8,815,198 Distributions in excess of net investment income (7) Net unrealized appreciation 138 Net assets at March 31, 2005 $8,815,329
Shares of beneficial interest issued and outstanding - unlimited shares authorized, 8,815,196 total shares outstanding Net assets Shares outstanding Net asset value per share Class A $7,602,700 7,602,586 $1.00 Class B 121,844 121,843 1.00 Class C 80,729 80,727 1.00 Class F 16,181 16,180 1.00 Class 529-A 124,654 124,652 1.00 Class 529-B 1,480 1,481 1.00 Class 529-C 6,528 6,528 1.00 Class 529-E 6,670 6,670 1.00 Class 529-F 3,649 3,649 1.00 Class R-1 11,868 11,867 1.00 Class R-2 406,728 406,722 1.00 Class R-3 251,303 251,299 1.00 Class R-4 100,470 100,468 1.00 Class R-5 80,525 80,524 1.00
See Notes to Financial Statements STATEMENT OF OPERATIONS for the six months ended March 31, 2005 Investment income: unaudited Income: (dollars in thousands) Interest $96,184 Fees and expenses: Investment advisory services $12,166 Distribution services 6,958 Transfer agent services 5,838 Administrative services 2,091 Reports to shareholders 272 Registration statement and prospectus 465 Postage, stationery and supplies 1,367 Trustees' compensation 37 Auditing and legal 40 Custodian 86 State and local taxes 26 Other 64 Total expenses before reimbursements 29,410 Reimbursement of expenses 2,733 26,677 Net investment income 69,507 Net unrealized appreciation on investments 246 Net increase in net assets resulting from operations $69,753 See Notes to Financial Statements STATEMENT OF CHANGES IN NET ASSETS (dollars in thousands) Six months Year ended ended March 31, September 30, 2005* 2004 Operations: Net investment income $69,507 $66,502 Net unrealized appreciation (depreciation) on investments 246 (89) Net increase in net assets resulting from operations 69,753 66,413 Dividends paid or accrued to shareholders from net investment income (69,512) (66,502) Capital share transactions (89,960) 174,556 Total (decrease) increase in net assets (89,719) 174,467 Net assets: Beginning of period 8,905,048 8,730,581 End of period $8,815,329 $8,905,048 *Unaudited
See Notes to Financial Statements Notes to financial statements unaudited 1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES Organization - The Cash Management Trust of America (the "fund") is registered under the Investment Company Act of 1940 as an open-end, diversified management investment company. The fund seeks to provide income on cash reserves, while preserving capital and maintaining liquidity, through investments in high-quality, short-term money market instruments. The fund offers 14 share classes consisting of four retail share classes, five CollegeAmerica(R) savings plan share classes and five retirement plan share classes. The CollegeAmerica savings plan share classes (529-A, 529-B, 529-C, 529-E and 529-F) are sponsored by the Commonwealth of Virginia and can be utilized to save for college education. The five retirement plan share classes (R-1, R-2, R-3, R-4 and R-5) are sold without any sales charges and do not carry any conversion rights. The fund's share classes are described below: SHARE CLASS INITIAL SALES CHARGE CONTINGENT DEFERRED SALES CONVERSION FEATURE CHARGE UPON REDEMPTION Classes A and 529-A None None None Classes B and 529-B None Declines from 5% to zero Classes B and 529-B for redemptions within convert to classes A and six years of purchase 529-A, respectively, after eight years Class C None 1% for redemptions within Class C converts to Class F one year of purchase after 10 years Class 529-C None 1% for redemptions within None one year of purchase Class 529-E None None None Classes F and 529-F None None None Classes R-1, R-2, R-3, None None None R-4 and R-5
Holders of all share classes have equal pro rata rights to assets, dividends and liquidation proceeds. Each share class has identical voting rights, except for the exclusive right to vote on matters affecting only its class. Share classes have different fees and expenses ("class-specific fees and expenses"), primarily due to different arrangements for distribution, administrative and shareholder services. Differences in class-specific fees and expenses will result in differences in net investment income and, therefore, the payment of different per-share dividends by each class. CollegeAmerica is a registered trademark of the Virginia College Savings Plan.(SM) SIGNIFICANT ACCOUNTING POLICIES - The financial statements have been prepared to comply with accounting principles generally accepted in the United States of America. These principles require management to make estimates and assumptions that affect reported amounts and disclosures. Actual results could differ from those estimates. The following is a summary of the significant accounting policies followed by the fund: NET ASSET VALUE - The fund values its shares in accordance with Securities and Exchange Commission ("SEC") rules, using the penny-rounding method, which permits the fund to maintain a constant net asset value of $1.00 per share. SECURITY VALUATION - Fixed-income securities are valued at prices obtained from an independent pricing service, when such prices are available. However, where the investment adviser deems it appropriate, such securities will be valued at the mean quoted bid and asked prices (or bid prices, if asked prices are not available) or at prices for securities of comparable maturity, quality and type. Short-term securities purchased within 60 days to maturity are valued at amortized cost, which approximates market value. The value of short-term securities purchased with greater than 60 days to maturity with 60 days or less remaining to maturity is determined based on the market value on the 61st day. The ability of the issuers of the debt securities held by the fund to meet their obligations may be affected by economic developments in a specific industry, state or region. Securities and other assets for which representative market quotations are not readily available are fair valued as determined in good faith under procedures adopted by authority of the fund's Board of Trustees. Various factors may be reviewed in order to make a good faith determination of a security's fair value. These factors include, but are not limited to, the type and cost of the security; contractual or legal restrictions on resale of the security; relevant financial or business developments of the issuer; actively traded similar or related securities; conversion or exchange rights on the security; related corporate actions; significant events occurring after the close of trading in the security; and changes in overall market conditions. SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME - Security transactions are recorded by the fund as of the date the trades are executed with brokers. Interest income is recognized on an accrual basis. Market discounts, premiums and original issue discounts on fixed-income securities are amortized daily over the expected life of the security. CLASS ALLOCATIONS - Income, fees and expenses (other than class-specific fees and expenses) are allocated daily among the various share classes based on the relative value of their settled shares. Unrealized gains and losses are allocated daily among the various share classes based on their relative net assets. Class-specific fees and expenses, such as distribution, administrative and shareholder services, are charged directly to the respective share class. Dividends to shareholders -Dividends paid to shareholders are declared daily after the determination of the fund's net investment income and are paid to shareholders monthly. 2. FEDERAL INCOME TAXATION AND DISTRIBUTIONS The fund complies with the requirements under Subchapter M of the Internal Revenue Code applicable to mutual funds and intends to distribute substantially all of its net taxable income each year. The fund is not subject to income taxes to the extent such distributions are made. DISTRIBUTIONS - Distributions paid to shareholders are based on net investment income determined on a tax basis, which may differ from net investment income for financial reporting purposes. As of March 31, 2005, there were no material differences between book and tax reporting. The fiscal year in which amounts are distributed may differ from the year in which the net investment income is recorded by the fund. As of March 31, 2005, the cost of investment securities for federal income tax purposes was $8,813,696,000. As of March 31, 2005, the components of distributable earnings on a tax basis were as follows (dollars in thousands): Undistributed net investment income. $394 Gross unrealized appreciation on investment securities 173 Gross unrealized depreciation on investment securities (35) Net unrealized appreciation on investment securities 138 Distributions paid or accrued to shareholders from ordinary income were as follows (dollars in thousands): SHARE CLASS SIX MONTHS ENDED MARCH 31, 2005 YEAR ENDED SEPTEMBER 30, 2004 Class A $ 63,524 $ 64,312 Class B 525 173 Class C 249 86 Class F 157 90 Class 529-A 887 482 Class 529-B 6 1 Class 529-C 17 5 Class 529-E 33 7 Class 529-F 24 7 Class R-1 37 10 Class R-2 1,412 294 Class R-3 1,292 292 Class R-4 625 217 Class R-5 724 526 Total $ 69,512 $ 66,502
3. FEES AND TRANSACTIONS WITH RELATED PARTIES Capital Research and Management Company ("CRMC"), the fund's investment adviser, is the parent company of American Funds Service Company ("AFS"), the fund's transfer agent, and American Funds Distributors, Inc. ("AFD"), the principal underwriter of the fund's shares. INVESTMENT ADVISORY SERVICES - The Investment Advisory and Service Agreement with CRMC provides for monthly fees accrued daily. These fees are based on a declining series of annual rates beginning with 0.320% on the first $1 billion of daily net assets and decreasing to 0.270% on such assets in excess of $2 billion. The Investment Advisory and Service Agreement also provides that CRMC will reimburse the fund's Class A shares to the extent that annual operating expenses exceed 25% of gross income. Expenses related to interest, taxes, brokerage commissions and extraordinary items are not subject to these limitations. At the beginning of the period, low income levels, caused by low short-term interest rates, resulted in expenses exceeding this limit. At March 31, 2005, higher income levels resulted in the fund's expenses falling within the limit. During the six months ended March 31, 2005, these reimbursements totaled $2,183,000. As a result, the fee shown on the accompanying financial statements of $12,166,000, which was equivalent to an annualized rate of 0.278%, was reduced to $9,983,000, or 0.228% of average daily net assets. The amount of reimbursement during any period will vary in accordance with the fund's gross income and expense levels. CLASS-SPECIFIC FEES AND EXPENSES - Expenses that are specific to individual share classes are accrued directly to the respective share class. The principal class-specific fees and expenses are described below: DISTRIBUTION SERVICES - The fund has adopted plans of distribution for all share classes, except Class R-5. Under the plans, the Board of Trustees approves certain categories of expenses that are used to finance activities primarily intended to sell fund shares. The plans provide for annual expenses, based on a percentage of average daily net assets, ranging from 0.15% to 1.00% as noted below. In some cases, the Board of Trustees has approved expense amounts lower than plan limits. All share classes may use a portion (0.15% for classes A, B, 529-A and 529-B shares and 0.25% for all other share classes) of average daily net assets to pay service fees, or to compensate AFD for paying service fees, to firms that have entered into agreements with AFD for providing certain shareholder services. Expenses in excess of these amounts, up to approved limits, may be used to compensate dealers and wholesalers for shares sold. SHARE CLASS CURRENTLY APPROVED LIMITS PLAN LIMITS Class A 0.15% 0.15% Class 529-A 0.15 0.50 Classes B and 529-B 0.90 0.90 Classes C, 529-C and R-1 1.00 1.00 Class R-2 0.75 1.00 Classes 529-E and R-3 0.50 0.75 Classes F, 529-F and R-4 0.25 0.50
TRANSFER AGENT SERVICES - The fund has a transfer agent agreement with AFS for classes A and B. Under this agreement, these share classes compensate AFS for transfer agent services including shareholder recordkeeping, communications and transaction processing. AFS is also compensated for certain transfer agent services provided to all other share classes from the administrative services fees paid to CRMC described on the following page. ADMINISTRATIVE SERVICES - The fund has an administrative services agreement with CRMC to provide transfer agent and other related shareholder services for all classes of shares other than classes A and B. Each relevant class pays CRMC annual fees of 0.15% (0.10% for Class R-5) based on its respective average daily net assets. Each relevant class also pays AFS additional amounts for certain transfer agent services. CRMC and AFS may use these fees to compensate third parties for performing these services. During the six months ended March 31, 2005, CRMC agreed to pay a portion of these fees for classes R-1, R-2 and R-3. For the six months ended March 31, 2005, the total fees paid by CRMC were $3,000, $506,000 and $41,000 for classes R-1, R-2 and R-3, respectively. Administrative services fees are presented gross of any payments made by CRMC. Each 529 share class is subject to an additional annual administrative services fee of 0.10% of its respective average daily net assets; this fee is payable to the Commonwealth of Virginia for the maintenance of the CollegeAmerica plan. Although these amounts are included with administrative services fees in the accompanying financial statements, the Commonwealth of Virginia is not considered a related party. Expenses under the agreements described on the previous page for the six months ended March 31, 2005, were as follows (dollars in thousands): SHARE CLASS DISTRIBUTION TRANSFER AGENT ADMINISTRATIVE SERVICES SERVICES SERVICES CRMC TRANSFER AGENT COMMONWEALTH OF ADMINISTRATIVE SERVICES VIRGINIA SERVICES ADMINISTRATIVE SERVICES Class A $3,699 $5,756 Not applicable Not applicable Not applicable Class B 580 82 Not applicable Not applicable Not applicable Class C 392 Included $59 $19 Not applicable in administrative services Class F 29 Included 17 6 Not applicable in administrative services Class 529-A 45 Included 88 23 $59 in administrative services Class 529-B 9 Included 1 1 1 in administrative services Class 529-C 30 Included 4 2 3 in administrative services Class 529-E 15 Included 5 1 3 in administrative services Class 529-F 4 Included 3 1 2 in administrative services Class R-1 52 Included 8 6 Not applicable in administrative services Class R-2 1,424 Included 285 1,013 Not applicable in administrative services Class R-3 575 Included 172 195 Not applicable in administrative services Class R-4 104 Included 62 4 Not applicable in administrative services Class R-5 Not applicable Included 41 7 Not applicable in administrative services Total $6,958 $5,838 $745 $1,278 $68
At the beginning of the period, due to lower short-term interest rates, CRMC agreed to pay a portion of the class-specific fees and expenses. For the six months ended March 31, 2005, the total fees paid by CRMC for Class 529-C were $115. DEFERRED TRUSTEES' COMPENSATION - Since the adoption of the deferred compensation plan in 1993, Trustees who are unaffiliated with CRMC may elect to defer the cash payment of part or all of their compensation. These deferred amounts, which remain as liabilities of the fund, are treated as if invested in shares of the fund. These amounts represent general, unsecured liabilities of the fund and vary according to the total return of the fund. Trustees' compensation in the accompanying financial statements includes the current fees (either paid in cash or deferred) and the net increase or decrease in the value of the deferred amounts. AFFILIATED OFFICERS AND TRUSTEES - Officers and certain Trustees of the fund are or may be considered to be affiliated with CRMC, AFS and AFD. No affiliated officers or Trustees received any compensation directly from the fund. 4. CAPITAL SHARE TRANSACTIONS Capital share transactions in the fund were as follows (dollars and shares in thousands): Share class Sales(1) Reinvestments of dividends Amount Shares Amount Shares Six months ended March 31, 2005 Class A $ 6,698,728 6,698,728 $ 61,148 61,148 Class B 46,326 46,326 480 480 Class C 74,304 74,304 220 220 Class F 37,633 37,633 137 137 Class 529-A 51,619 51,619 877 877 Class 529-B 377 377 6 6 Class 529-C 2,411 2,411 17 17 Class 529-E 3,027 3,027 33 33 Class 529-F 1,529 1,529 23 23 Class R-1 12,128 12,128 36 36 Class R-2 506,495 506,495 1,359 1,359 Class R-3 314,169 314,169 1,249 1,249 Class R-4 158,047 158,047 599 599 Class R-5 124,446 124,446 708 708 Total net increase (decrease) $ 8,031,239 8,031,239 $ 66,892 66,892 Year ended September 30, 2004 Class A $ 13,520,809 13,520,809 $ 61,845 61,845 Class B 154,993 154,993 157 157 Class C 192,284 192,284 77 77 Class F 103,416 103,416 82 82 Class 529-A 108,238 108,238 475 475 Class 529-B 2,040 2,040 1 1 Class 529-C 5,325 5,325 4 4 Class 529-E 4,489 4,489 7 7 Class 529-F 3,316 3,316 7 7 Class R-1 30,040 30,040 9 9 Class R-2 1,008,066 1,008,066 279 279 Class R-3 546,922 546,922 282 282 Class R-4 163,157 163,157 208 208 Class R-5 184,623 184,623 497 497 Total net increase (decrease) $ 16,027,718 16,027,718 $ 63,930 63,930 Share class Repurchases(1) Net (decrease) increase Amount Shares Amount Shares Six months ended March 31, 2005 Class A $ (6,923,399) (6,923,399) $ (163,523) (163,523) Class B (81,675) (81,675) (34,869) (34,869) Class C (97,904) (97,904) (23,380) (23,380) Class F (60,378) (60,378) (22,608) (22,608) Class 529-A (40,002) (40,002) 12,494 12,494 Class 529-B (908) (908) (525) (525) Class 529-C (1,569) (1,569) 859 859 Class 529-E (1,681) (1,681) 1,379 1,379 Class 529-F (1,142) (1,142) 410 410 Class R-1 (10,165) (10,165) 1,999 1,999 Class R-2 (449,631) (449,631) 58,223 58,223 Class R-3 (274,636) (274,636) 40,782 40,782 Class R-4 (123,151) (123,151) 35,495 35,495 Class R-5 (121,850) (121,850) 3,304 3,304 Total net increase (decrease) $ (8,188,091) (8,188,091) $ (89,960) (89,960) Year ended September 30, 2004 Class A $ (13,726,229) (13,726,229) $ (143,575) (143,575) Class B (171,364) (171,364) (16,214) (16,214) Class C (176,973) (176,973) 15,388 15,388 Class F (72,052) (72,052) 31,446 31,446 Class 529-A (85,852) (85,852) 22,861 22,861 Class 529-B (1,117) (1,117) 924 924 Class 529-C (3,117) (3,117) 2,212 2,212 Class 529-E (3,819) (3,819) 677 677 Class 529-F (2,402) (2,402) 921 921 Class R-1 (27,861) (27,861) 2,188 2,188 Class R-2 (865,474) (865,474) 142,871 142,871 Class R-3 (474,880) (474,880) 72,324 72,324 Class R-4 (124,548) (124,548) 38,817 38,817 Class R-5 (181,404) (181,404) 3,716 3,716 Total net increase (decrease) $ (15,917,092) (15,917,092) $ 174,556 174,556
(1) Includes exchanges between share classes of the fund. 5. INVESTMENT TRANSACTIONS AND OTHER DISCLOSURES The fund receives a reduction in its custodian fee equal to the amount of interest calculated on certain cash balances held at the custodian bank. For the six months ended March 31, 2005, the custodian fee of $86,000, shown on the accompanying financial statements, includes $8,000 that was offset by this reduction, rather than paid in cash. FINANCIAL HIGHLIGHTS (1) Net asset Dividends value, Net from net beginning investment investment of period income (2) income Class A: Six months ended 3/31/2005 (5) $1.00 $.008 $(.008) Year ended 9/30/2004 1.00 .008 (.008) Year ended 9/30/2003 1.00 .011 (.011) Year ended 9/30/2002 1.00 .013 (.013) Year ended 9/30/2001 1.00 .045 (.045) Year ended 9/30/2000 1.00 .055 (.055) Class B: Six months ended 3/31/2005 (5) 1.00 .004 (.004) Year ended 9/30/2004 1.00 .001 (.001) Year ended 9/30/2003 1.00 .001 (.001) Year ended 9/30/2002 1.00 .005 (.005) Year ended 9/30/2001 1.00 .037 (.037) Period from 3/15/2000 to 9/30/2000 1.00 .027 (.027) Class C: Six months ended 3/31/2005 (5) 1.00 .003 (.003) Year ended 9/30/2004 1.00 .001 (.001) Year ended 9/30/2003 1.00 .001 (.001) Year ended 9/30/2002 1.00 .004 (.004) Period from 3/16/2001 to 9/30/2001 1.00 .014 (.014) Class F: Six months ended 3/31/2005 (5) 1.00 .007 (.007) Year ended 9/30/2004 1.00 .004 (.004) Year ended 9/30/2003 1.00 .006 (.006) Year ended 9/30/2002 1.00 .011 (.011) Period from 3/26/2001 to 9/30/2001 1.00 .017 (.017) Class 529-A: Six months ended 3/31/2005 (5) 1.00 .008 (.008) Year ended 9/30/2004 1.00 .005 (.005) Year ended 9/30/2003 1.00 .007 (.007) Period from 2/15/2002 to 9/30/2002 1.00 .007 (.007) Class 529-B: Six months ended 3/31/2005 (5) 1.00 .003 (.003) Year ended 9/30/2004 1.00 .001 (.001) Year ended 9/30/2003 1.00 .001 (.001) Period from 6/7/2002 to 9/30/2002 1.00 .001 (.001) Class 529-C: Six months ended 3/31/2005 (5) 1.00 .003 (.003) Year ended 9/30/2004 1.00 .001 (.001) Year ended 9/30/2003 1.00 .001 (.001) Period from 4/2/2002 to 9/30/2002 1.00 .002 (.002) Class 529-E: Six months ended 3/31/2005 (5) 1.00 .005 (.005) Year ended 9/30/2004 1.00 .002 (.002) Year ended 9/30/2003 1.00 .002 (.002) Period from 3/11/2002 to 9/30/2002 1.00 .004 (.004) Class 529-F: Six months ended 3/31/2005 (5) 1.00 .007 (.007) Year ended 9/30/2004 1.00 .003 (.003) Year ended 9/30/2003 1.00 .004 (.004) Period from 9/16/2002 to 9/30/2002 1.00 - (8) - (8) Class R-1: Six months ended 3/31/2005 (5) 1.00 .003 (.003) Year ended 9/30/2004 1.00 .001 (.001) Year ended 9/30/2003 1.00 .001 (.001) Period from 5/29/2002 to 9/30/2002 1.00 .001 (.001) Class R-2: Six months ended 3/31/2005 (5) 1.00 .004 (.004) Year ended 9/30/2004 1.00 .001 (.001) Year ended 9/30/2003 1.00 .001 (.001) Period from 5/21/2002 to 9/30/2002 1.00 .001 (.001) Class R-3: Six months ended 3/31/2005 (5) 1.00 .006 (.006) Year ended 9/30/2004 1.00 .002 (.002) Year ended 9/30/2003 1.00 .002 (.002) Period from 6/4/2002 to 9/30/2002 1.00 .002 (.002) Class R-4: Six months ended 3/31/2005 (5) 1.00 .007 (.007) Year ended 9/30/2004 1.00 .004 (.004) Year ended 9/30/2003 1.00 .006 (.006) Period from 6/27/2002 to 9/30/2002 1.00 .002 (.002) Class R-5: Six months ended 3/31/2005 (5) 1.00 .009 (.009) Year ended 9/30/2004 1.00 .007 (.007) Year ended 9/30/2003 1.00 .009 (.009) Period from 5/15/2002 to 9/30/2002 1.00 .005 (.005) Net asset Net assets, value, end Total end of period of period return (3) (in millions) Class A: Six months ended 3/31/2005 (5) $1.00 .84% $7,603 Year ended 9/30/2004 1.00 .84 7,766 Year ended 9/30/2003 1.00 1.05 7,910 Year ended 9/30/2002 1.00 1.35 8,305 Year ended 9/30/2001 1.00 4.63 7,075 Year ended 9/30/2000 1.00 5.66 5,417 Class B: Six months ended 3/31/2005 (5) 1.00 .42 122 Year ended 9/30/2004 1.00 .12 157 Year ended 9/30/2003 1.00 .13 173 Year ended 9/30/2002 1.00 .53 158 Year ended 9/30/2001 1.00 3.75 46 Period from 3/15/2000 to 9/30/2000 1.00 2.73 1 Class C: Six months ended 3/31/2005 (5) 1.00 .34 81 Year ended 9/30/2004 1.00 .10 104 Year ended 9/30/2003 1.00 .12 89 Year ended 9/30/2002 1.00 .40 100 Period from 3/16/2001 to 9/30/2001 1.00 1.40 13 Class F: Six months ended 3/31/2005 (5) 1.00 .72 16 Year ended 9/30/2004 1.00 .41 39 Year ended 9/30/2003 1.00 .55 7 Year ended 9/30/2002 1.00 1.13 10 Period from 3/26/2001 to 9/30/2001 1.00 1.71 4 Class 529-A: Six months ended 3/31/2005 (5) 1.00 .75 125 Year ended 9/30/2004 1.00 .47 112 Year ended 9/30/2003 1.00 .66 89 Period from 2/15/2002 to 9/30/2002 1.00 .73 34 Class 529-B: Six months ended 3/31/2005 (5) 1.00 .32 1 Year ended 9/30/2004 1.00 .10 2 Year ended 9/30/2003 1.00 .12 1 Period from 6/7/2002 to 9/30/2002 1.00 .09 - (7) Class 529-C: Six months ended 3/31/2005 (5) 1.00 .28 6 Year ended 9/30/2004 1.00 .10 6 Year ended 9/30/2003 1.00 .12 3 Period from 4/2/2002 to 9/30/2002 1.00 .15 1 Class 529-E: Six months ended 3/31/2005 (5) 1.00 .54 7 Year ended 9/30/2004 1.00 .15 5 Year ended 9/30/2003 1.00 .22 5 Period from 3/11/2002 to 9/30/2002 1.00 .39 1 Class 529-F: Six months ended 3/31/2005 (5) 1.00 .66 4 Year ended 9/30/2004 1.00 .28 3 Year ended 9/30/2003 1.00 .43 2 Period from 9/16/2002 to 9/30/2002 1.00 .04 - (7) Class R-1: Six months ended 3/31/2005 (5) 1.00 .34 12 Year ended 9/30/2004 1.00 .10 10 Year ended 9/30/2003 1.00 .12 8 Period from 5/29/2002 to 9/30/2002 1.00 .10 1 Class R-2: Six months ended 3/31/2005 (5) 1.00 .36 407 Year ended 9/30/2004 1.00 .11 348 Year ended 9/30/2003 1.00 .12 206 Period from 5/21/2002 to 9/30/2002 1.00 .11 23 Class R-3: Six months ended 3/31/2005 (5) 1.00 .55 251 Year ended 9/30/2004 1.00 .16 211 Year ended 9/30/2003 1.00 .23 138 Period from 6/4/2002 to 9/30/2002 1.00 .22 15 Class R-4: Six months ended 3/31/2005 (5) 1.00 .74 100 Year ended 9/30/2004 1.00 .43 65 Year ended 9/30/2003 1.00 .55 26 Period from 6/27/2002 to 9/30/2002 1.00 .23 1 Class R-5: Six months ended 3/31/2005 (5) 1.00 .89 80 Year ended 9/30/2004 1.00 .72 77 Year ended 9/30/2003 1.00 .87 74 Period from 5/15/2002 to 9/30/2002 1.00 .50 49 Ratio of expenses Ratio of expenses Ratio of to average net to average net net income assets before assets after to average reimbursements reimbursements(4) net assets Class A: Six months ended 3/31/2005 (5) .58% (6) .53%(6) 1.67% (6) Year ended 9/30/2004 .57 .28 .84 Year ended 9/30/2003 .55 .23 1.05 Year ended 9/30/2002 .59 .59 1.33 Year ended 9/30/2001 .59 .59 4.48 Year ended 9/30/2000 .61 .61 5.53 Class B: Six months ended 3/31/2005 (5) 1.36 (6) 1.36 (6) .81 (6) Year ended 9/30/2004 1.34 1.02 .12 Year ended 9/30/2003 1.38 1.14 .14 Year ended 9/30/2002 1.40 1.40 .47 Year ended 9/30/2001 1.41 1.41 3.01 Period from 3/15/2000 to 9/30/2000 1.43 (6) 1.43 (6) 5.21 (6) Class C: Six months ended 3/31/2005 (5) 1.53 (6) 1.53 (6) .64 (6) Year ended 9/30/2004 1.51 1.05 .10 Year ended 9/30/2003 1.55 1.16 .12 Year ended 9/30/2002 1.55 1.51 .31 Period from 3/16/2001 to 9/30/2001 1.55 (6) 1.55 (6) 2.05 (6) Class F: Six months ended 3/31/2005 (5) .75 (6) .75 (6) 1.34 (6) Year ended 9/30/2004 .72 .71 .61 Year ended 9/30/2003 .73 .73 .58 Year ended 9/30/2002 .77 .77 1.11 Period from 3/26/2001 to 9/30/2001 .80 (6) .80 (6) 3.09 (6) Class 529-A: Six months ended 3/31/2005 (5) .70 (6) .70 (6) 1.51 (6) Year ended 9/30/2004 .67 .66 .48 Year ended 9/30/2003 .62 .62 .61 Period from 2/15/2002 to 9/30/2002 .60 (6) .60 (6) 1.16 (6) Class 529-B: Six months ended 3/31/2005 (5) 1.55 (6) 1.55 (6) .62 (6) Year ended 9/30/2004 1.53 1.06 .10 Year ended 9/30/2003 1.52 1.13 .12 Period from 6/7/2002 to 9/30/2002 .47 .47 .08 Class 529-C: Six months ended 3/31/2005 (5) 1.64 (6) 1.63 (6) .58 (6) Year ended 9/30/2004 1.63 1.05 .10 Year ended 9/30/2003 1.62 1.11 .11 Period from 4/2/2002 to 9/30/2002 .79 .75 .12 Class 529-E: Six months ended 3/31/2005 (5) 1.12 (6) 1.12 (6) 1.10 (6) Year ended 9/30/2004 1.11 .98 .15 Year ended 9/30/2003 1.11 1.05 .17 Period from 3/11/2002 to 9/30/2002 1.09 (6) 1.09 (6) .66 (6) Class 529-F: Six months ended 3/31/2005 (5) .87 (6) .87 (6) 1.34 (6) Year ended 9/30/2004 .86 .85 .30 Year ended 9/30/2003 .85 .85 .33 Period from 9/16/2002 to 9/30/2002 .03 .03 .04 Class R-1: Six months ended 3/31/2005 (5) 1.57 (6) 1.51(6) .70 (6) Year ended 9/30/2004 1.56 1.03 .10 Year ended 9/30/2003 1.61 1.08 .10 Period from 5/29/2002 to 9/30/2002 .71 .51 .09 Class R-2: Six months ended 3/31/2005 (5) 1.74 (6) 1.47 (6) .74 (6) Year ended 9/30/2004 1.76 1.03 .11 Year ended 9/30/2003 1.68 1.08 .11 Period from 5/21/2002 to 9/30/2002 .57 .52 .11 Class R-3: Six months ended 3/31/2005 (5) 1.13 (6) 1.09 (6) 1.12 (6) Year ended 9/30/2004 1.12 .97 .16 Year ended 9/30/2003 1.10 1.03 .17 Period from 6/4/2002 to 9/30/2002 .37 .34 .22 Class R-4: Six months ended 3/31/2005 (5) .72 (6) .72 (6) 1.50 (6) Year ended 9/30/2004 .71 .70 .46 Year ended 9/30/2003 .72 .72 .48 Period from 6/27/2002 to 9/30/2002 .30 .19 .27 Class R-5: Six months ended 3/31/2005 (5) .42 (6) .42 (6) 1.78 (6) Year ended 9/30/2004 .42 .40 .75 Year ended 9/30/2003 .41 .41 .84 Period from 5/15/2002 to 9/30/2002 .16 .16 .50
(1) Based on operations for the period shown (unless otherwise noted) and, accordingly, may not be representative of a full year. (2) Based on average shares outstanding. (3) Total returns exclude all sales charges, including contingent deferred sales charges. (4) The ratios in this column reflect the impact, if any, of certain reimbursements from CRMC. During some of the periods shown, CRMC reimbursed expenses, as provided by the Investment Advisory and Service Agreement. During the start-up period for the retirement plan share classes (except R-5), CRMC agreed to pay a portion of the fees related to transfer agent services. In addition, during some of the periods shown, due to lower short-term interest rates, CRMC agreed to pay a portion of the class-specific fees and expenses for some of the share classes. (5) Unaudited. (6) Annualized. (7) Amount less than $1 million. (8) Amount less than $.001. See Notes to Financial Statements THE CASH MANAGEMENT TRUST OF AMERICA OTHER SHARE CLASS RESULTS (unaudited) Class B, Class C, Class F and Class 529 Figures shown are past results and are not predictive of results in future periods. Current and future results may be lower or higher than those shown. Share prices and returns will vary, so investors may lose money. For the most current information and month-end results, visit americanfunds.com. Average annual total returns for periods ended March 31, 2005: 1 year 5 years Life of class Class B shares(1) Reflecting applicable contingent deferred sales charge (CDSC), maximum of 5%, payable only if shares are sold within six years of purchase -4.51% +1.11% +1.32%(2) Not reflecting CDSC +0.49% +1.49% +1.51%(2) Class C shares(1) Reflecting CDSC, maximum of 1%, payable only if shares are sold within one year of purchase -0.61% -- +0.58%(3) Not reflecting CDSC +0.39% -- +0.58%(3) Class F shares(4) Not reflecting annual asset-based fee charged by sponsoring firm +0.96% -- +1.13%(5) Class 529-A shares +1.02% -- +0.84%(6) Class 529-B shares(1) Reflecting applicable CDSC, maximum of 5%, payable only if shares are sold within six years of purchase -4.62% -- -1.21%(7) Not reflecting CDSC +0.38% -- +0.23%(7) Class 529-C shares(1) Reflecting CDSC, maximum of 1%, payable only if shares are sold within one year of purchase -0.67% -- +0.22%(8) Not reflecting CDSC +0.33% -- +0.22%(8) Class 529-E shares(1,4) +0.64% -- +0.42%(9) Class 529-F shares(1,4) Not reflecting annual asset-based fee charged by sponsoring firm +0.84% -- +0.56%(10)
(1) The fund's investment adviser has reimbursed certain expenses. Results shown reflect the reimbursement, without which they would have been lower. Please see the Financial Highlights table on page 22 for details. (2) From March 15, 2000, when Class B shares were first sold. (3) From March 16, 2001, when Class C shares were first sold. (4) These shares are sold without any initial or contingent deferred sales charge. (5) From March 26, 2001, when Class F shares were first sold. (6) From February 15, 2002, when Class 529-A shares were first sold. (7) From June 7, 2002, when Class 529-B shares were first sold. (8) From April 2, 2002, when Class 529-C shares were first sold. (9) From March 11, 2002, when Class 529-E shares were first sold. (10) From September 16, 2002, when Class 529-F shares were first sold. EXPENSE EXAMPLE (unaudited) As a shareholder of the fund, you incur two types of costs: (1) transaction costs such as initial sales charges on purchase payments and contingent deferred sales charges on redemptions (loads); and (2) ongoing costs, including management fees; distribution and service (12b-1) fees; and other expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the fund so you can compare these costs with the ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (October 1, 2004 through March 31, 2005). ACTUAL EXPENSES: The first line of each share class in the table on page 29 provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled "Expenses paid during period" to estimate the expenses you paid on your account during this period. There are some account fees that are charged to certain types of accounts, such as Individual Retirement Accounts and CollegeAmerica accounts (generally, a $10 fee is charged to set up the account and an additional $10 fee is charged to the account annually) that would increase the amount of expenses paid on your account. In addition, retirement plan participants may be subject to certain fees charged by the plan sponsor, and Class F and Class 529-F shareholders may be subject to fees charged by financial intermediaries, typically ranging from 0.75% to 1.50% of assets annually depending on services offered. You can estimate the impact of these fees by adding the amount of the fees to the total estimated expenses you paid on your account during the period as calculated above. In addition, your ending account value would also be lower by the amount of these fees. HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES: The second line of each share class in the table on page 29 provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio for the share class and an assumed rate of return of 5.00% per year before expenses, which is not the actual return of the share class. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the fund and other funds. To do so, compare this 5.00% hypothetical example with the 5.00% hypothetical examples that appear in the shareholder reports of the other funds. There are some account fees that are charged to certain shareholders, such as Individual Retirement Accounts and CollegeAmerica accounts (generally, a $10 fee is charged to set up the account and an additional $10 fee is charged to the account annually) that would increase the amount of expenses paid on your account. In addition, retirement plan participants may be subject to certain fees charged by the plan sponsor, and Class F and Class 529-F shareholders may be subject to fees charged by financial intermediaries, typically ranging from 0.75% to 1.50% of assets annually depending on services offered. You can estimate the impact of these fees by adding the amount of the fees to the total estimated expenses you paid on your account during the period as calculated on the previous page. In addition, your ending account value would also be lower by the amount of these fees. Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads). Therefore, the second line of each share class in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher. Beginning Ending Expenses Annualized account account paid during expense ratio value value period(1) 10/1/2004 3/31/2005 Class A -- actual return $1,000.00 $1,008.38 $2.65 .53% Class A -- assumed 5% return 1,000.00 1,022.29 2.67 .53 Class B -- actual return 1,000.00 1,004.21 6.80 1.36 Class B -- assumed 5% return 1,000.00 1,018.15 6.84 1.36 Class C -- actual return 1,000.00 1,003.35 7.64 1.53 Class C -- assumed 5% return 1,000.00 1,017.30 7.70 1.53 Class F -- actual return 1,000.00 1,007.16 3.75 .75 Class F -- assumed 5% return 1,000.00 1,021.19 3.78 .75 Class 529-A -- actual return 1,000.00 1,007.51 3.50 .70 Class 529-A -- assumed 5% return 1,000.00 1,021.44 3.53 .70 Class 529-B -- actual return 1,000.00 1,003.23 7.74 1.55 Class 529-B -- assumed 5% return 1,000.00 1,017.20 7.80 1.55 Class 529-C -- actual return 1,000.00 1,002.83 8.14 1.63 Class 529-C -- assumed 5% return 1,000.00 1,016.80 8.20 1.63 Class 529-E -- actual return 1,005.39 5.60 1.12 1,000.00 Class 529-E -- assumed 5% return 1,000.00 1,019.35 5.64 1.12 Class 529-F -- actual return 1,000.00 1,006.63 4.35 .87 Class 529-F -- assumed 5% return 1,000.00 1,020.59 4.38 .87 Class R-1 -- actual return 1,000.00 1,003.45 7.54 1.51 Class R-1 -- assumed 5% return 1,000.00 1,017.40 7.59 1.51 Class R-2 -- actual return 1,000.00 1,003.63 7.34 1.47 Class R-2 -- assumed 5% return 1,000.00 1,017.60 7.39 1.47 Class R-3 -- actual return 1,000.00 1,005.55 5.45 1.09 Class R-3 -- assumed 5% return 1,000.00 1,019.50 5.49 1.09 Class R-4 -- actual return 1,000.00 1,007.42 3.60 .72 Class R-4 -- assumed 5% return 1,000.00 1,021.34 3.63 .72 Class R-5 -- actual return 1,000.00 1,008.89 2.10 .42 Class R-5 -- assumed 5% return 1,000.00 1,022.84 2.12 .42
(1) Expenses are equal to the annualized expense ratio, multiplied by the average account value over the period, multiplied by the number of days in the period (182), and divided by 365 (to reflect the one-half year period). THE CASH MANAGEMENT TRUST OF AMERICA APPROVAL OF RENEWAL OF INVESTMENT ADVISORY AND SERVICE AGREEMENT The fund's Board of Trustees has unanimously approved renewal of the fund's Investment Advisory and Service Agreement (the "agreement") with Capital Research and Management Company ("CRMC") for an additional one-year term through May 31, 2006, following the unanimous recommendation of the fund's Contracts Committee (the "Committee"), composed of all of the fund's independent Trustees. The material factors and the conclusions that formed the basis for the Committee's recommendation and the Board's subsequent approval are described below. MATERIALS REVIEWED During the course of each year, the independent Trustees receive a wide variety of materials relating to the nature, extent and quality of services provided by CRMC. In addition, the Committee requests and reviews supplementary information focused on evaluating the agreement. This includes extensive materials regarding investment results of the fund and CRMC, advisory fee and expense comparisons, financial and profitability information with respect to CRMC, descriptions of various functions such as compliance monitoring and portfolio trading practices, and information about the personnel providing investment management and administrative services to the fund. INVESTMENT RESULTS The Committee reviewed the investment results of the fund and compared those results with the Lipper Money Market Funds Index and selected funds included in that index. The Committee noted that the fund's investment results surpassed those of the index as well as the average of the selected funds for the one-, three- and five-year periods ended December 31, 2004, and matched the performance of the index and the average of the selected funds for the 10-year period ended on that date. The Committee also noted that investment results in 2003 and 2004 benefited from a contractual expense reimbursement requirement that helped maintain fund yields during that period of low interest rates. CRMC AND ITS PERSONNEL The Committee also considered the depth and quality of CRMC's research capabilities; the low turnover rates of its key personnel; the overall financial strength and stability of its organization; the experience, capability and integrity of its senior management; its commitment to ensuring compliance with applicable laws and regulations; its efforts to keep the Trustees informed; and its sensitivity to matters that may involve conflicts of interest with the fund. ADVISORY FEES AND TOTAL EXPENSES The Committee compared the advisory fees and total expenses of the fund (as a percentage of average net assets) with the average fees and expenses of the funds in the index and those of the selected group of funds referred to on the previous page. The Committee noted that the fund's advisory fees and total expenses were lower than the fees and expenses of both the index and the average of the selected funds and that its advisory fees had been reduced during 2004 as a result of the certain contractual expense reimbursement requirement. The Committee also reviewed information regarding the advisory fees paid by institutional clients of an affiliate of CRMC with similar investment mandates. The Committee concluded that, although the fees paid by those clients generally were lower than those paid by American Funds, the differences appropriately reflected CRMC's significantly greater responsibilities with respect to the American Funds and the more comprehensive regulatory regime applicable to mutual funds. ADVISER PROFITABILITY; ECONOMIES OF SCALE The Committee reviewed information regarding CRMC's costs of providing services to the American Funds, and also reviewed the operating results and profitability of CRMC, noting that those results were comparable to the reported results of several large publicly held investment management companies. The Committee also received information during the past year regarding the manner in which CRMC's employees were compensated. The Committee also noted that CRMC's profits would be reduced further during the coming year as a result of an increase in CRMC's voluntary fee waiver, and that the fund's advisory fee structure provides for significant fee reductions as fund assets increase, reflecting economies of scale in the cost of operations that are shared with investors. ANCILLARY BENEFITS In addition, the Committee considered a variety of other benefits received by CRMC and its affiliates as a result of CRMC's relationship with the fund and the other American Funds, including fees for administrative services provided to certain share classes; fees paid to CRMC's affiliated transfer agent; sales charges and distribution fees received and retained by the fund's principal underwriter, an affiliate of CRMC; and possible ancillary benefits to CRMC's institutional management affiliate. The Trustees reviewed CRMC's portfolio trading practices, noting that, while CRMC receives the benefit of research provided by broker-dealers executing portfolio transactions on behalf of the fund, it does not obtain third-party research or other services in return for allocating brokerage to such broker-dealers. CONCLUSIONS Based on its review, the Committee concluded that the nature, extent and quality of the services being provided to the fund by CRMC continued to be excellent, and that each of the factors referred to above favored renewal of the agreement. However, in deciding to recommend renewal, the Committee did not identify a single issue as the controlling factor and this summary does not describe all of the matters considered. The Committee was advised with respect to relevant legal standards by counsel independent of CRMC. The Committee discussed the continuance of the agreement with management and in a private session with counsel at which no representatives of CRMC were present. Based on its review, the Committee concluded that the fund's advisory fee is fair, both absolutely and in comparison with those of other similar funds in the industry; that the fund's shareholders have received reasonable value in return for those fees; and that continuation of the agreement is in the best interest of the fund's shareholders. The Committee's conclusions were confirmed by separate vote of the independent Trustees at the March 15, 2005, Board meeting. U.S. TREASURY MONEY FUND OF AMERICA Investment portfolio unaudited March 31, 2005 [begin pie chart] U.S. Treasuries 100% [end pie chart] Yield at amount value Short-term securities - 100.08% acquisition (000) (000) U.S. Treasuries - 100.08% U.S. Treasury Bills 4-7-05 2.29%-2.34% $ 35,450 $ 35,437 U.S. Treasury Bills 4-14-05 2.36%-2.69% 98,750 98,662 U.S. Treasury Bills 4-21-05 2.58%-2.72% 101,800 101,644 U.S. Treasury Bills 4-28-05 2.60%-2.61% 50,400 50,300 U.S. Treasury Bills 5-5-05 2.52%-2.66% 42,750 42,649 U.S. Treasury Bills 5-12-05 2.54%-2.67% 91,800 91,538 U.S. Treasury Bills 5-26-05 2.71%-2.74% 58,000 57,770 U.S. Treasury Bills 6-9-05 2.75% 11,000 10,943 U.S. Treasury Bills 6-16-05 2.79% 40,000 39,770 TOTAL INVESTMENT SECURITIES (cost: $528,671,000) 528,713 Other assets less liabilities (399) NET ASSETS $528,314 See Notes to Financial Statements
FINANCIAL STATEMENTS STATEMENT OF ASSETS AND LIABILITIES unaudited at March 31, 2005 (dollars and shares in thousands, except per-share amounts) ASSETS: Investment securities at market (cost: $528,671) $528,713 Cash 653 Receivables for sales of fund's shares 1,214 530,580 LIABILITIES: Payables for: Repurchases of fund's shares $1,868 Dividends on fund's shares 36 Investment advisory services 128 Services provided by affiliates 204 Deferred Trustees' compensation 23 Other fees and expenses 7 2,266 NET ASSETS AT MARCH 31, 2005 $528,314 NET ASSETS CONSIST OF: Capital paid in on shares of beneficial interest $528,272 Net unrealized appreciation 42 NET ASSETS AT MARCH 31, 2005 $528,314
SHARES OF BENEFICIAL INTEREST ISSUED AND OUTSTANDING - UNLIMITED SHARES AUTHORIZED, 528,271 TOTAL SHARES OUTSTANDING Net assets Shares outstanding Net asset value per share Class A $474,200 474,161 $1.00 Class R-1 1,049 1,049 1.00 Class R-2 25,119 25,117 1.00 Class R-3 17,644 17,642 1.00 Class R-4 3,664 3,664 1.00 Class R-5 6,638 6,638 1.00
See Notes to Financial Statements STATEMENT OF OPERATIONS for the six months ended March 31, 2005 INVESTMENT INCOME: unaudited Income: (dollars in thousands) Interest $5,541 Fees and expenses: Investment advisory services $828 Distribution services 444 Transfer agent services 366 Administrative services 115 Reports to shareholders 18 Registration statement and prospectus 66 Postage, stationery and supplies 61 Trustees' compensation 14 Auditing and legal 11 Custodian 8 State and local taxes 7 Other 27 Total expenses before reimbursements/waivers 1,965 Reimbursement/waiver of expenses 76 1,889 Net investment income 3,652 Net unrealized appreciation on investments 6 NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $3,658 See Notes to Financial Statements STATEMENT OF CHANGES IN NET ASSETS (dollars in thousands) Six months Year ended ended March 31, September 30, 2005* 2004 OPERATIONS: Net investment income $3,652 $2,220 Net unrealized appreciation on investments 6 7 Net increase in net assets resulting from operations 3,658 2,227 Dividends paid or accrued to shareholders from net investment income (3,651) (2,219) Capital share transactions (51,454) (83,761) Total decrease in net assets (51,447) (83,753) NET ASSETS: Beginning of period 579,761 663,514 End of period $528,314 $579,761
* Unaudited See Notes to Financial Statements NOTES TO FINANCIAL STATEMENTS unaudited 1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES ORGANIZATION - The U.S. Treasury Money Fund of America (the "fund") is registered under the Investment Company Act of 1940 as an open-end, diversified management investment company. The fund seeks to provide income on cash reserves, while preserving capital and maintaining liquidity, through investments in U.S. Treasury securities maturing in one year or less. The fund offers six share classes consisting of one retail share class (Class A) and five retirement plan share classes (R-1, R-2, R-3, R-4 and R-5). All share classes are sold without any sales charges and do not carry any conversion rights. Holders of all share classes have equal pro rata rights to assets, dividends and liquidation proceeds. Each share class has identical voting rights, except for the exclusive right to vote on matters affecting only its class. Share classes have different fees and expenses ("class-specific fees and expenses"), primarily due to different arrangements for distribution, administrative and shareholder services. Differences in class-specific fees and expenses will result in differences in net investment income and, therefore, the payment of different per-share dividends by each class. SIGNIFICANT ACCOUNTING POLICIES - The financial statements have been prepared to comply with accounting principles generally accepted in the United States of America. These principles require management to make estimates and assumptions that affect reported amounts and disclosures. Actual results could differ from those estimates. The following is a summary of the significant accounting policies followed by the fund: NET ASSET VALUE - The fund values its shares in accordance with Securities and Exchange Commission ("SEC") rules, using the penny-rounding method, which permits the fund to maintain a constant net asset value of $1.00 per share. SECURITY VALUATION -Fixed-income securities are valued at prices obtained from an independent pricing service, when such prices are available. However, where the investment adviser deems it appropriate, such securities will be valued at the mean quoted bid and asked prices (or bid prices, if asked prices are not available) or at prices for securities of comparable maturity, quality and type. Short-term securities purchased within 60 days to maturity are valued at amortized cost, which approximates market value. The value of short-term securities purchased with greater than 60 days to maturity with 60 days or less remaining to maturity is determined based on the market value on the 61st day. Securities and other assets for which representative market quotations are not readily available are fair valued as determined in good faith under procedures adopted by authority of the fund's Board of Trustees. SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME - Security transactions are recorded by the fund as of the date the trades are executed with brokers. Interest income is recognized on an accrual basis. Market discounts, premiums and original issue discounts on fixed-income securities are amortized daily over the expected life of the security. CLASS ALLOCATIONS - Income, fees and expenses (other than class-specific fees and expenses) are allocated daily among the various share classes based on the relative value of their settled shares. Unrealized gains and losses are allocated daily among the various share classes based on their relative net assets. Class-specific fees and expenses, such as distribution, administrative and shareholder services, are charged directly to the respective share class. DIVIDENDS TO SHAREHOLDERS - Dividends paid to shareholders are declared daily after the determination of the fund's net investment income and are paid to shareholders monthly. 2. FEDERAL INCOME TAXATION AND DISTRIBUTIONS The fund complies with the requirements under Subchapter M of the Internal Revenue Code applicable to mutual funds and intends to distribute substantially all of its net taxable income each year. The fund is not subject to income taxes to the extent such distributions are made. DISTRIBUTIONS - Distributions paid to shareholders are based on net investment income determined on a tax basis, which may differ from net investment income for financial reporting purposes. As of March 31, 2005, there were no material differences between book and tax reporting. The fiscal year in which amounts are distributed may differ from the year in which the net investment income is recorded by the fund. As of March 31, 2005, the cost of investment securities for federal income tax purposes was $528,671,000. As of March 31, 2005, the components of distributable earnings on a tax basis were as follows (dollars in thousands): Undistributed net investment income $59 Gross unrealized appreciation on investment securities 42 Distributions paid or accrued to shareholders from ordinary income were as follows (dollars in thousands): Share class Six months ended March 31, 2005 Year ended September 30, 2004 Class A $ 3,442 $ 2,147 Class R-1 3 1 Class R-2 62 19 Class R-3 75 16 Class R-4 21 5 Class R-5 48 31 Total $ 3,651 $ 2,219
3. FEES AND TRANSACTIONS WITH RELATED PARTIES Capital Research and Management Company ("CRMC"), the fund's investment adviser, is the parent company of American Funds Service Company ("AFS"), the fund's transfer agent, and American Funds Distributors, Inc. ("AFD"), the principal underwriter of the fund's shares. INVESTMENT ADVISORY SERVICES - The Investment Advisory and Service Agreement provides for monthly fees accrued daily. These fees are based on an annual rate of 0.300% on the first $800 million of daily net assets and 0.285% on such assets in excess of $800 million. During the six months ended March 31, 2005, CRMC reduced investment advisory services fees by $41,000. As a result, the fee shown on the accompanying financial statements of $828,000, which was equivalent to an annualized rate of 0.300%, was reduced to $787,000, or 0.285% of average daily net assets. CLASS-SPECIFIC FEES AND EXPENSES - Expenses that are specific to individual share classes are accrued directly to the respective share class. The principal class-specific fees and expenses are described on the following page: DISTRIBUTION SERVICES - The fund has adopted plans of distribution for all share classes, except Class R-5. Under the plans, the Board of Trustees approves certain categories of expenses that are used to finance activities primarily intended to sell fund shares. The plans provide for annual expenses, based on a percentage of average daily net assets, ranging from 0.15% to 1.00% as noted below. In some cases, the Board of Trustees has approved expense amounts lower than plan limits. All share classes may use a portion (0.15% for Class A and 0.25% for all other share classes) of average daily net assets to pay service fees, or to compensate AFD for paying service fees, to firms that have entered into agreements with AFD for providing certain shareholder services. Expenses in excess of these amounts, up to approved limits, may be used to compensate dealers and wholesalers for shares sold. Share class Currently approved limits Plan limits Class A 0.15% 0.15% Class R-1 1.00 1.00 Class R-2 0.75 1.00 Class R-3 0.50 0.75 Class R-4 0.25 0.50 TRANSFER AGENT SERVICES - The fund has a transfer agent agreement with AFS for Class A shares. Under this agreement, this share class compensates AFS for transfer agent services including shareholder recordkeeping, communications and transaction processing. AFS is also compensated for certain transfer agent services provided to all other share classes from the administrative services fees paid to CRMC described on the following page. ADMINISTRATIVE SERVICES - The fund has an administrative services agreement with CRMC to provide transfer agent and other related shareholder services for all classes of shares other than Class A. Each relevant class pays CRMC annual fees of 0.15% (0.10% for Class R-5) based on its respective average daily net assets. Each relevant class also pays AFS additional amounts for certain transfer agent services. CRMC and AFS may use these fees to compensate third parties for performing these services. During the six months ended March 31, 2005, CRMC agreed to pay a portion of these fees for classes R-1, R-2 and R-3. For the six months ended March 31, 2005, the total fees paid by CRMC were $449, $33,000 and $1,000 for classes R-1, R-2 and R-3, respectively. Administrative services fees are presented gross of any payments made by CRMC. Expenses under the agreements described on the previous page for the six months ended March 31, 2005, were as follows (dollars in thousands): SHARE CLASS DISTRIBUTION TRANSFER AGENT ADMINISTRATIVE SERVICES SERVICES SERVICES CRMC TRANSFER AGENT ADMINISTRATIVE SERVICES SERVICES Class A $305 $366 Not applicable Not applicable Class R-1 5 Included in administrative services $1 $1 Class R-2 89 Included in administrative services 18 65 Class R-3 41 Included in administrative services 12 12 Class R-4 4 Included in administrative services 3 -* Class R-5 Not applicable Included in administrative services 3 -* Total $444 $366 $37 $78
* Amount less than one thousand. At the beginning of the period, due to lower short-term interest rates, CRMC agreed to pay a portion of the class-specific fees and expenses. For the six months ended March 31, 2005, the total fees paid by CRMC were $62 and $676 for classes R-1 and R-2, respectively. DEFERRED TRUSTEES' COMPENSATION - Since the adoption of the deferred compensation plan in 1993, Trustees who are unaffiliated with CRMC may elect to defer the cash payment of part or all of their compensation. These deferred amounts, which remain as liabilities of the fund, are treated as if invested in shares of the fund. These amounts represent general, unsecured liabilities of the fund and vary according to the total returns of the fund. Trustees' compensation in the accompanying financial statements includes the current fees (either paid in cash or deferred) and the net increase or decrease in the value of the deferred amounts. AFFILIATED OFFICERS AND TRUSTEES - Officers and certain Trustees of the fund are or may be considered to be affiliated with CRMC, AFS and AFD. No affiliated officers or Trustees received any compensation directly from the fund. 4. CAPITAL SHARE TRANSACTIONS Capital share transactions in the fund were as follows (dollars and shares in thousands): Share class Sales(1) Reinvestments of dividends Amount Shares Amount Shares Six months ended March 31, 2005 Class A $176,886 176,886 $ 3,262 3,262 Class R-1 540 540 3 3 Class R-2 15,775 15,775 61 61 Class R-3 15,724 15,724 71 71 Class R-4 9,921 9,921 20 20 Class R-5 6,781 6,781 25 25 Total net increase (decrease) $225,627 225,627 $ 3,442 3,442 Year ended September 30, 2004 Class A $432,833 432,833 $ 2,052 2,052 Class R-1 1,164 1,164 -* -* Class R-2 43,831 43,831 18 18 Class R-3 20,221 20,221 16 16 Class R-4 5,349 5,349 5 5 Class R-5 12,974 12,974 19 19 Total net increase (decrease) $516,372 516,372 $ 2,110 2,110 Share class Repurchases(1) Net (decrease) increase Amount Shares Amount Shares Six months ended March 31, 2005 Class A $ (238,241) (238,241) $ (58,093) (58,093) Class R-1 (570) (570) (27) (27) Class R-2 (12,696) (12,696) 3,140 3,140 Class R-3 (13,887) (13,887) 1,908 1,908 Class R-4 (8,462) (8,462) 1,479 1,479 Class R-5 (6,667) (6,667) 139 139 Total net increase (decrease) $ (280,523) (280,523) $ (51,454) (51,454) Year ended September 30, 2004 Class A $ (533,936) (533,936) $ (99,051) (99,051) Class R-1 (419) (419) 745 745 Class R-2 (36,449) (36,449) 7,400 7,400 Class R-3 (15,625) (15,625) 4,612 4,612 Class R-4 (4,662) (4,662) 692 692 Class R-5 (11,152) (11,152) 1,841 1,841 Total net increase (decrease) $ (602,243) (602,243) $ (83,761) (83,761)
* Amount less than one thousand. (1) Includes exchanges between share classes of the fund. 5. INVESTMENT TRANSACTIONS AND OTHER DISCLOSURES The fund receives a reduction in its custodian fee equal to the amount of interest calculated on certain cash balances held at the custodian bank. For the six months ended March 31, 2005, the custodian fee of $8,000, shown on the accompanying financial statements, includes $4,000 that was offset by this reduction, rather than paid in cash. FINANCIAL HIGHLIGHTS (1) Net asset Dividends value, Net from net beginning investment investment of period income(2) income Class A: Six months ended 3/31/2005 (4) $1.00 $.007 $(.007) Year ended 9/30/2004 1.00 .004 (.004) Year ended 9/30/2003 1.00 .006 (.006) Year ended 9/30/2002 1.00 .013 (.013) Year ended 9/30/2001 1.00 .042 (.042) Year ended 9/30/2000 1.00 .049 (.049) Class R-1: Six months ended 3/31/2005 (4) 1.00 .002 (.002) Year ended 9/30/2004 1.00 .001 (.001) Year ended 9/30/2003 1.00 .001 (.001) Period from 7/12/2002 to 9/30/2002 1.00 .001 (.001) Class R-2: Six months ended 3/31/2005 (4) 1.00 .003 (.003) Year ended 9/30/2004 1.00 .001 (.001) Year ended 9/30/2003 1.00 .001 (.001) Period from 6/11/2002 to 9/30/2002 1.00 .001 (.001) Class R-3: Six months ended 3/31/2005 (4) 1.00 .004 (.004) Year ended 9/30/2004 1.00 .001 (.001) Year ended 9/30/2003 1.00 .002 (.002) Period from 8/16/2002 to 9/30/2002 1.00 .001 (.001) Class R-4: Six months ended 3/31/2005 (4) 1.00 .006 (.006) Year ended 9/30/2004 1.00 .002 (.002) Year ended 9/30/2003 1.00 .004 (.004) Period from 8/2/2002 to 9/30/2002 1.00 .002 (.002) Class R-5: Six months ended 3/31/2005 (4) 1.00 .008 (.008) Year ended 9/30/2004 1.00 .006 (.006) Year ended 9/30/2003 1.00 .008 (.008) Period from 5/15/2002 to 9/30/2002 1.00 .005 (.005) Net asset Net assets, value, end Total end of period of period return (in millions) Class A: Six months ended 3/31/2005 (4) $1.00 .69% $474 Year ended 9/30/2004 1.00 .39 532 Year ended 9/30/2003 1.00 .63 631 Year ended 9/30/2002 1.00 1.29 683 Year ended 9/30/2001 1.00 4.27 489 Year ended 9/30/2000 1.00 5.01 369 Class R-1: Six months ended 3/31/2005 (4) 1.00 .24 1 Year ended 9/30/2004 1.00 .10 1 Year ended 9/30/2003 1.00 .12 - (6) Period from 7/12/2002 to 9/30/2002 1.00 .11 - (6) Class R-2: Six months ended 3/31/2005 (4) 1.00 .25 25 Year ended 9/30/2004 1.00 .10 22 Year ended 9/30/2003 1.00 .12 15 Period from 6/11/2002 to 9/30/2002 1.00 .08 1 Class R-3: Six months ended 3/31/2005 (4) 1.00 .44 17 Year ended 9/30/2004 1.00 .12 16 Year ended 9/30/2003 1.00 .18 11 Period from 8/16/2002 to 9/30/2002 1.00 .07 - (6) Class R-4: Six months ended 3/31/2005 (4) 1.00 .63 4 Year ended 9/30/2004 1.00 .24 2 Year ended 9/30/2003 1.00 .43 2 Period from 8/2/2002 to 9/30/2002 1.00 .17 - (6) Class R-5: Six months ended 3/31/2005 (4) 1.00 .78 7 Year ended 9/30/2004 1.00 .55 7 Year ended 9/30/2003 1.00 .75 5 Period from 5/15/2002 to 9/30/2002 1.00 .47 4 Ratio of expenses Ratio of expenses to average to average Ratio of net assets net assets net income before reimbursements/ after reimbursements/ to average waivers waivers(3) net assets Class A: Six months ended 3/31/2005 (4) .65% (5) .63% (5) 1.37% (5) Year ended 9/30/2004 .62 .61 .39 Year ended 9/30/2003 .58 .58 .63 Year ended 9/30/2002 .63 .63 1.27 Year ended 9/30/2001 .66 .66 4.12 Year ended 9/30/2000 .62 .62 4.81 Class R-1: Six months ended 3/31/2005 (4) 1.65 (5) 1.54 (5) .48 (5) Year ended 9/30/2004 1.63 .94 .10 Year ended 9/30/2003 1.91 1.08 .12 Period from 7/12/2002 to 9/30/2002 .54 .32 .05 Class R-2: Six months ended 3/31/2005 (4) 1.81 (5) 1.51 (5) .52 (5) Year ended 9/30/2004 1.81 .92 .10 Year ended 9/30/2003 1.74 1.02 .10 Period from 6/11/2002 to 9/30/2002 .50 .44 .08 Class R-3: Six months ended 3/31/2005 (4) 1.16 (5) 1.13 (5) .91 (5) Year ended 9/30/2004 1.14 .89 .13 Year ended 9/30/2003 1.17 .99 .11 Period from 8/16/2002 to 9/30/2002 .20 .13 .07 Class R-4: Six months ended 3/31/2005 (4) .78 (5) .77 (5) 1.29 (5) Year ended 9/30/2004 .77 .76 .23 Year ended 9/30/2003 .79 .77 .36 Period from 8/2/2002 to 9/30/2002 .33 .12 .15 Class R-5: Six months ended 3/31/2005 (4) .47 (5) .45 (5) 1.57 (5) Year ended 9/30/2004 .45 .45 .57 Year ended 9/30/2003 .46 .46 .73 Period from 5/15/2002 to 9/30/2002 .18 .18 .46
(1) Based on operations for the period shown (unless otherwise noted) and, accordingly, may not be representative of a full year. (2) Based on average shares outstanding. (3) The ratios in this column reflect the impact, if any, of certain reimbursements/waivers from CRMC. During some of the periods shown, CRMC reduced fees for investment advisory services for all share classes. During the start-up period for the retirement plan share classes (except Class R-5), CRMC agreed to pay a portion of the fees related to transfer agent services. In addition, during some of the periods shown, due to lower short-term interest rates, CRMC agreed to pay a portion of the class-specific fees and expenses. (4) Unaudited. (5) Annualized. (6) Amount less than $1 million. See Notes to Financial Statements EXPENSE EXAMPLE (unaudited) As a shareholder of the fund, you incur two types of costs: (1) transaction costs such as initial sales charges on purchase payments and contingent deferred sales charges on redemptions (loads); and (2) ongoing costs, including management fees; distribution and service (12b-1) fees; and other expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the fund so you can compare these costs with the ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (October 1, 2004 through March 31, 2005). ACTUAL EXPENSES: The first line of each share class in the table on the next page provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled "Expenses paid during period" to estimate the expenses you paid on your account during this period. There are some account fees that are charged to certain types of accounts, such as Individual Retirement Accounts (generally, a $10 fee is charged to set up the account and an additional $10 fee is charged to the account annually) that would increase the amount of expenses paid on your account. In addition, retirement plan participants may be subject to certain fees charged by the plan sponsor. You can estimate the impact of these fees by adding the amount of the fees to the total estimated expenses you paid on your account during the period as calculated above. In addition, your ending account value would also be lower by the amount of these fees. HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES: The second line of each share class in the table on the next page provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio for the share class and an assumed rate of return of 5.00% per year before expenses, which is not the actual return of the share class. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the fund and other funds. To do so, compare this 5.00% hypothetical example with the 5.00% hypothetical examples that appear in the shareholder reports of the other funds. There are some account fees that are charged to certain shareholders, such as Individual Retirement Accounts (generally, a $10 fee is charged to set up the account and an additional $10 fee is charged to the account annually) that would increase the amount of expenses paid on your account. In addition, retirement plan participants may be subject to certain fees charged by the plan sponsor. You can estimate the impact of these fees by adding the amount of the fees to the total estimated expenses you paid on your account during the period as calculated on the previous page. In addition, your ending account value would also be lower by the amount of these fees. Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads). Therefore, the second line of each share class in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher. Beginning Ending Expenses Annualized account account aid during expense ratio value value period(1) 10/1/2004 3/31/2005 Class A -- actual return $1,000.00 $1,006.92 $3.15 .63% Class A -- assumed 5% return 1,000.00 1,021.79 3.18 .63 Class R-1 -- actual return 1,000.00 1,002.39 7.69 1.54 Class R-1 -- assumed 5% return 1,000.00 1,017.25 7.75 1.54 Class R-2 -- actual return 1,000.00 1,002.55 7.54 1.51 Class R-2 -- assumed 5% return 1,000.00 1,017.40 7.59 1.51 Class R-3 -- actual return 1,000.00 1,004.43 5.65 1.13 Class R-3 -- assumed 5% return 1,000.00 1,019.30 5.69 1.13 Class R-4 -- actual return 1,000.00 1,006.26 3.85 .77 Class R-4 -- assumed 5% return 1,000.00 1,021.09 3.88 .77 Class R-5 -- actual return 1,000.00 1,007.83 2.25 .45 Class R-5 -- assumed 5% return 1,000.00 1,022.69 2.27 .45
(1) Expenses are equal to the annualized expense ratio, multiplied by the average account value over the period, multiplied by the number of days in the period (182), and divided by 365 (to reflect the one-half year period). THE TAX-EXEMPT MONEY FUND OF AMERICA Investment portfolio unaudited March 31, 2005 [begin pie chart] Texas 19.84% Maryland 10.58 Florida 8.36 Arizona 5.48 District of Columbia 5.28 Utah 4.95 Nevada 4.90 Virginia 4.56 Michigan 4.39 Wyoming 4.32 Other states 26.39 Other assets less liabilities .95 [end pie chart] Principal Market Yield at amount value Short-term securities - 99.05% Acquisition (000) (000) Arizona - 5.48% City of Phoenix Civic Improvement Corp., Water System Rev. Bond Anticipation Notes, TECP: Series 2003-A, 2.20% 5/27/05 2.20% $ 2,000 $ 2,000 Series 2003-B, 2.02% 5/13/05 2.02 5,000 5,000 Salt River Project Agricultural Improvement and Power Dist., TECP: Series B, 1.93% 4/13/05 1.93 4,300 4,300 Series C: 1.94% 4/6/05 1.94 4,000 4,000 2.06% 5/12/05 2.06 7,500 7,500 District of Columbia - 5.28% Metropolitan Washington Airports Auth., Flexible Term PFC Rev. Notes, Series 1999-A, AMT, TECP, 2.11% 5/13/05 2.11 1,000 1,000 Multimodal Rev. Bonds (American National Red Cross Issue), Series 2000, TECP: 1.90% 4/4/05 1.90 4,000 4,000 1.94% 4/7/05 1.94 2,000 2,000 Variable Rate Rev. Bonds (National Academy of Sciences Project), AMBAC insured, TECP: Series 1999-B: 2.10% 5/26/05 2.10 4,500 4,500 2.25% 6/1/05 2.25 3,500 3,499 Series 1999-C: 2.05% 5/11/05 2.05 5,000 5,000 2.25% 6/3/05 2.25 2,000 1,999 Florida - 8.36% Dade County, Special Obligation Bonds, Series 1990, 2.30% 10/1/10 (1) 2.30 1,115 1,115 Jacksonville County Electric Auth., Series 1993-C1, TECP: 1.94% 4/8/05 1.94 3,000 3,000 2.04% 5/11/05 2.04 2,000 2,000 Mayo Foundation Health Care Facs., Jacksonville Health Facs. Auth. (St. Luke's Hospital Association), Rev. Ref. Bonds, Series 2001-B, TECP, 2.00% 5/5/05 2.00 2,000 2,000 Municipal Power Agcy. (Initial Pooled Loan Project), Series 1995-A, TECP: 1.90% 4/5/05 1.90 2,700 2,700 2.03% 5/4/05 2.03 2,000 2,000 Sarasota County Public Hospital Dist., Hospital Rev. Bonds (Sarasota Memorial Hospital Project), TECP: Series 1985-B, 2.04% 5/12/05 2.04 1,000 1,000 Series 1985-C: 2.00% 4/1/05 2.00 2,400 2,400 2.02% 5/2/05 2.02 3,000 3,000 2.10% 5/24/05 2.10 2,000 2,000 Sunshine State Governmental Fncg. Commission, Rev. Notes (Governmental Fncg. Program), AMBAC/FGIC insured, TECP: Series 2000-A: 2.00% 4/5/05 2.00 2,500 2,500 2.00% 4/6/05 2.00 2,500 2,500 1.94% 4/11/05 1.94 3,900 3,900 Series 2000-D: 1.94% 4/8/05 1.94 1,450 1,450 2.04% 5/6/05 2.04 1,400 1,400 2.25% 6/2/05 2.25 1,860 1,859 Georgia - 0.45% Dev. Auth. of the Unified Government of Athens-Clarke County, Rev. Bonds (University of Georgia Athletic Association Project), Series 2003, 2.30% 8/1/33 (1) 2.30 1,850 1,850 Indiana - 0.29% City of Whiting, Environmental Facs. Rev. Ref. Bonds (BP Products North America Inc. Project), Series 2002-C, AMT, 2.35% 7/1/34 (1) 2.35 1,200 1,200 Kentucky - 0.26% Regional Airport Auth. of Louisville and Jefferson County, Special Facs. Rev. Bonds (UPS Worldwide Forwarding, Inc. Project), Series 1999-A, AMT, 2.33% 1/1/29 (1) 2.33 1,100 1,100 Maryland - 10.58% Baltimore County, Consolidated Public Improvement Bond Anticipation Notes, Series 1995, TECP: 1.94% 4/4/05 1.94 2,000 2,000 1.95% 4/4/05 1.95 2,000 2,000 1.94% 4/5/05 1.94 2,000 2,000 1.94% 4/8/05 1.94 2,400 2,400 1.94% 4/11/05 1.94 5,000 5,000 2.00% 5/3/05 2.00 2,500 2,500 Health and Higher Educational Facs. Auth., Commercial Paper Rev. Notes, John Hopkins University Issue, Series A, TECP: 1.93% 4/12/05 1.93 2,229 2,229 2.00% 5/5/05 2.00 3,400 3,400 2.25% 6/6/05 2.25 4,500 4,498 Montgomery County, Consolidated Public Improvement Commercial Paper Anticipation Notes, Series 2002, TECP: 1.96% 4/7/05 1.96 8,500 8,500 1.92% 4/8/05 1.92 1,500 1,500 1.95% 4/12/05 1.95 1,500 1,500 2.28% 5/5/05 2.28 2,500 2,500 2.03% 5/9/05 2.03 2,000 2,000 Washington Suburban Sanitary Dist., Montgomery and Prince George's Counties, G.O. Ref. Bonds of 2001, 4.50% 6/1/05 1.96 2,000 2,008 Massachusetts - 2.64% Health and Educational Fac. Auth., Rev. Notes, Harvard University Issue, Series 2002-EE, TECP: 2.03% 5/10/05 2.03 3,000 3,000 2.03% 5/11/05 2.03 3,000 3,000 2.00% 5/16/05 2.00 5,000 4,999 Michigan - 4.39% Regents of the University of Michigan, Series F, TECP: 2.00% 4/1/05 2.00 4,360 4,360 1.94% 4/5/05 1.94 3,300 3,300 2.00% 4/8/05 2.00 2,000 2,000 2.00% 4/12/05 2.00 6,600 6,600 2.08% 5/23/05 2.08 2,000 2,000 Minnesota - 3.00% City of Rochester, Health Care Facs. Rev. Bonds (Mayo Foundation/Mayo Medical Center), TECP: Series 1988-E, 2.08% 5/10/05 2.08 3,000 3,000 Series 1992-B, 2.03% 5/6/05 2.03 3,000 3,000 Series 2000-A, 2.00% 5/5/05 2.00 2,600 2,600 Series 2000-C, 2.08% 5/16/05 2.08 2,500 2,500 Series 2001-B, 2.00% 5/5/05 2.00 1,400 1,400 Nebraska - 0.62% Hospital Auth. No. 1 of Lancaster County, Health Facs. Rev. Bonds (Immanuel Health Systems - Williamsburg Project), Series 2000-A, 2.31% 7/1/30 (1) 2.31 2,585 2,585 Nevada - 4.90% Clark County, G.O. (Limited Tax) Flood Control Commercial Paper Notes, Series 2003-A, TECP, 2.02% 5/18/05 2.02 10,000 9,999 Clark County Industrial Dev. Rev. Bonds (Nevada Cogeneration Associates #2 Project), Series 1992, AMT, 2.35% 12/1/22 (1) 2.35 2,100 2,100 Las Vegas Valley Water Dist., G.O. Limited Tax Water Notes (SNWA Rev. Supported), Series 2004-A, TECP: 1.95% 4/1/05 1.95 2,900 2,900 2.00% 4/6/05 2.00 5,400 5,400 New Mexico - 1.69% Tax and Rev. Anticipation Notes, Series 2004-A: 4.00% 6/30/05 1.96 2,000 2,008 5.00% 6/30/05 3.03 5,000 5,031 New York - 1.20% Metropolitan Transportation Auth., Rev. Bond Anticipation Notes, Series A-1, TECP, 1.90% 4/1/05 1.90 5,000 5,000 North Carolina - 4.09% Capital Facs. Fin. Agcy., Duke University Issue, Series A-1, TECP: 2.00% 4/4/05 2.00 4,090 4,090 2.08% 5/2/05 2.08 3,000 3,000 2.04% 5/9/05 2.04 8,600 8,600 2.08% 5/23/05 2.08 1,345 1,345 Ohio - 1.08% G.O. Highway Capital Improvement Bonds (Full Faith and Credit/Highway User Receipts), Series H, 6.00% 5/1/05 1.93 2,000 2,006 State University, General Receipts Bonds, Series 2003-B, 4.00% 6/1/05 2.00 2,500 2,507 Pennsylvania - 0.48% Montgomery County Industrial Dev. Auth., Pollution Control Rev. Ref. Bonds (PECO Energy Co. Project), Series 2001-B, TECP, 2.06% 5/11/05 2.06 2,000 2,000 South Carolina - 2.35% Public Service Auth. (Santee Cooper), Rev. Notes, Series 1998, TECP: 1.93% 4/13/05 1.93 3,300 3,300 2.30% 5/4/05 2.30 4,000 4,000 2.05% 5/10/05 2.05 2,500 2,500 Tennessee - 0.55% City of Memphis, G.O. Bonds, Series 2003-A2, TECP, 2.04% 5/6/05 2.04 2,300 2,300 Texas - 19.84% Gulf Coast Waste Disposal Auth., Environmental Facs. Rev. Bonds (BP Products North America Inc. Project), Series 2002, AMT, 2.35% 7/1/36 (1) 2.35 1,625 1,625 Harris County, TECP: G.O. Bonds: Series B, 1.95% 4/11/05 1.95 3,780 3,780 Series C, 2.30% 4/29/05 2.30 4,600 4,600 Series D: 1.96% 4/5/05 1.96 900 900 2.00% 4/5/05 2.00 250 250 Hospital Dist., Rev. Notes, Series A, 2.00% 5/12/05 2.00 3,500 3,500 City of Houston, TECP: G.O. Notes: Series A: 2.02% 5/17/05 2.02 4,000 4,000 2.05% 5/17/05 2.05 6,000 5,999 Series B, 2.08% 5/19/05 2.08 1,000 1,000 Series E, 1.95% 4/7/05 1.95 3,500 3,500 Hotel Occupancy Tax and Parking Rev. Notes, Series A: 1.94% 4/6/05 1.94 1,800 1,800 2.04% 5/10/05 2.04 6,200 6,200 Public Fin. Auth., G.O. Bonds (Colonial Roadway Projects), TECP: Series 2002-B: 1.94% 4/8/05 1.94 3,950 3,950 1.95% 4/12/05 1.95 3,500 3,500 Series 2003, 1.98% 5/3/05 1.98 5,000 5,000 City of San Antonio, TECP: Electric and Gas Systems, Series A: 1.97% 4/13/05 1.97 5,500 5,500 2.05% 5/9/05 2.05 4,000 4,000 2.03% 5/13/05 2.03 5,000 5,000 Water System Commericial Paper Notes, Series 2001-A, 1.93% 4/13/05 1.93 2,000 2,000 Board of Regents of the Texas A&M University System, Rev. Fin. System Notes, Series B, 1.97% 4/8/05 1.97 3,000 3,000 Board of Regents of The University of Texas System, Permanent University Fund Flexible Rate Notes, Series 2002-A, TECP: 2.02% 5/2/05 2.02 9,000 9,000 2.04% 5/5/05 2.04 3,000 3,000 2.05% 5/17/05 2.05 1,511 1,511 Utah - 4.95% Intermountain Power Agcy., Variable Rate Power Supply Rev. and Ref. Bonds, TECP: Series 1985-F, AMBAC insured: 1.92% 4/5/05 1.92 2,600 2,600 1.93% 4/11/05 1.93 2,000 2,000 1.95% 4/12/05 1.95 1,000 1,000 2.30% 5/6/05 2.30 4,000 4,000 Series 1997-B2: 2.01% 5/12/05 2.01 5,500 5,500 2.02% 5/16/05 2.02 2,000 2,000 Series 1998-B5: 1.96% 4/6/05 1.96 2,500 2,500 2.01% 5/10/05 2.01 1,000 1,000 Virginia - 4.56% Metropolitan Washington Airports Auth., Flexible Term PFC Rev. Notes, Series 1999-A, AMT, TECP: 1.94% 4/4/05 1.94 4,000 4,000 2.06% 5/4/05 2.06 2,500 2,500 2.15% 5/27/05 2.15 3,000 3,000 2.17% 5/31/05 2.17 2,700 2,699 Peninsula Ports Auth., Coal Terminal Rev. Ref. Bonds (Dominion Terminal Associates Project), Series 1987-B, TECP, 1.94% 4/6/05 1.94 3,500 3,500 University of Virginia Issue Rev. Pledge Notes, Series 2003-A, TECP, 2.00% 5/6/05 2.00 3,300 3,300 Washington - 3.80% Everett Public Facs. Dist., Project Rev. Notes, Series 2002-A, TECP, 2.10% 5/25/05 2.10 2,000 2,000 King County, Unlimited Tax G.O. Ref. Bonds, Series 2003, 5.00% 6/1/05 2.06 2,000 2,009 Port of Seattle, Subordinate Lien Rev. Notes, TECP: Series A-1, 1.94% 4/11/05 1.94 2,000 2,000 Series B-1, AMT, 2.07% 5/4/05 2.07 4,800 4,800 City of Tacoma, Limited Tax G.O. Bond Anticipation Notes, Series 2002-2B, TECP: 1.96% 4/1/05 1.96 3,000 3,000 1.94% 4/11/05 1.94 2,000 2,000 West Virginia - 1.23% Higher Education Policy Commission, Rev. Bonds (Higher Education Facs.), Series 2004-B, FGIC insured, 6.00% 4/1/05 2.06 1,000 1,000 Public Energy Auth., Energy Rev. Bonds (Morgantown Energy Associates Project), AMT, TECP: Series 1989-A, 1.99% 4/8/05 1.99 1,200 1,200 Series 1990-A, 2.11% 5/4/05 2.11 2,900 2,900 Wisconsin - 2.66% Transportation Rev., TECP: Series 1997-A: 1.94% 4/7/05 1.94 3,000 3,000 2.10% 5/25/05 2.10 1,500 1,500 Series 1998-A, 1.98% 5/3/05 1.98 6,584 6,584 Wyoming - 4.32% Sweetwater County, Customized Purchase Pollution Control Rev. Ref. Bonds (PacifiCorp Project), Series 1988-A, TECP: 2.00% 4/1/05 2.00 3,000 3,000 2.00% 4/4/05 2.00 6,750 6,750 2.00% 4/5/05 2.00 5,250 5,250 2.06% 5/11/05 2.06 1,000 1,000 2.08% 5/23/05 2.08 2,000 2,000 TOTAL INVESTMENT SECURITIES (cost: $412,467,000) 412,444 Other assets less liabilities 3,959 NET ASSETS $416,403
(1) Coupon rate may change periodically; the date of the next scheduled coupon rate change is considered to be the maturity date. KEY TO ABBREVIATIONS Agcy. = Agency AMT = Alternative Minimum Tax Auth. = Authority Certs. of Part. = Certificates of Participation Dept. = Department Dev. = Development Dist. = District Econ. = Economic Fac. = Facility Facs. = Facilities Fin. = Finance Fncg. = Financing G.O. = General Obligation Preref. = Prerefunded Redev. = Redevelopment Ref. = Refunding Rev. = Revenue TECP = Tax-Exempt Commercial Paper See Notes to Financial Statements FINANCIAL STATEMENTS STATEMENT OF ASSETS AND LIABILITIES unaudited at March 31, 2005 (dollars and shares in thousands, except per-share amounts) ASSETS: Investment securities at market (cost: $412,467) $412,444 Cash 980 Receivables for: Sales of fund's shares $3,247 Interest 1,031 4,278 417,702 LIABILITIES: Payables for: Repurchases of fund's shares 1,049 Dividends on fund's shares 37 Investment advisory services 128 Services provided by affiliates 52 Deferred Trustees' compensation 25 Other fees and expenses 8 1,299 Net assets at March 31, 2005 $416,403 NET ASSETS CONSIST OF: Capital paid in on shares of beneficial interest $416,520 Distributions in excess of net investment income (94) Net unrealized depreciation (23) Net assets at March 31, 2005 $416,403
Shares of beneficial interest issued and outstanding - unlimited shares authorized, 416,523 total shares outstanding NET ASSETS SHARES OUTSTANDING NET ASSET VALUE PER SHARE Class A $395,083 395,196 $1.00 Class R-5 21,320 21,327 1.00
See Notes to Financial Statements STATEMENT OF OPERATIONS for the six months ended March 31, 2005 INVESTMENT INCOME: unaudited Income: (dollars in thousands) Interest $3,599 FEES AND EXPENSES: Investment advisory services $781 Distribution services 99 Transfer agent services 66 Administrative services 11 Reports to shareholders 13 Registration statement and prospectus 66 Postage, stationery and supplies 29 Trustees' compensation 15 Auditing and legal 11 Custodian 9 State and local taxes 6 Other 27 Total expenses before waivers 1,133 Waiver of expenses 39 1,094 Net investment income 2,505 Net unrealized depreciation on investments (1) Net increase in net assets resulting from operations $2,504 See Notes to Financial Statements STATEMENT OF CHANGES IN NET ASSETS (dollars in thousands) Six months Year ended ended March 31, September 30, 2005* 2004 OPERATIONS: Net investment income $2,505 $1,935 Net unrealized depreciation on investments (1) (18) Net increase in net assets resulting from operations 2,504 1,917 Dividends paid or accrued to shareholders from net investment income (2,506) (1,935) Capital share transactions (22,656) 75,787 Total (decrease) increase in net assets (22,658) 75,769 NET ASSETS: Beginning of period 439,061 363,292 End of period $416,403 $439,061
*Unaudited See Notes to Financial Statements NOTES TO FINANCIAL STATEMENTS unaudited 1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES ORGANIZATION - The Tax-Exempt Money Fund of America (the "fund") is registered under the Investment Company Act of 1940 as an open-end, diversified management investment company. The fund seeks to provide income free from federal taxes, while preserving capital and maintaining liquidity, through investments in high-quality municipal securities with effective maturities of one year or less. The fund offers two share classes consisting of one retail share class (Class A) and one retirement plan share class (Class R-5). Each share class is sold without any sales charges and does not carry any conversion rights. Holders of all share classes have equal pro rata rights to assets, dividends and liquidation proceeds. Each share class has identical voting rights, except for the exclusive right to vote on matters affecting only its class. Share classes have different fees and expenses ("class-specific fees and expenses"), primarily due to different arrangements for distribution, administrative and shareholder services. Differences in class-specific fees and expenses will result in differences in net investment income and, therefore, the payment of different per-share dividends by each class. SIGNIFICANT ACCOUNTING POLICIES - The financial statements have been prepared to comply with accounting principles generally accepted in the United States of America. These principles require management to make estimates and assumptions that affect reported amounts and disclosures. Actual results could differ from those estimates. The following is a summary of the significant accounting policies followed by the fund: NET ASSET VALUE - The fund values its shares in accordance with Securities and Exchange Commission ("SEC") rules, using the penny-rounding method, which permits the fund to maintain a constant net asset value of $1.00 per share. SECURITY VALUATION - Fixed-income securities are valued at prices obtained from an independent pricing service, when such prices are available. However, where the investment adviser deems it appropriate, such securities will be valued at the mean quoted bid and asked prices (or bid prices, if asked prices are not available) or at prices for securities of comparable maturity, quality and type. Short-term securities purchased within 60 days to maturity are valued at amortized cost, which approximates market value. The value of short-term securities purchased with greater than 60 days to maturity with 60 days or less remaining to maturity is determined based on the market value on the 61st day. The ability of the issuers of the debt securities held by the fund to meet their obligations may be affected by economic developments in a specific industry, state or region. Securities and other assets for which representative market quotations are not readily available are fair valued as determined in good faith under procedures adopted by authority of the fund's Board of Trustees. Various factors may be reviewed in order to make a good faith determination of a security's fair value. These factors include, but are not limited to, the type and cost of the security; contractual or legal restrictions on resale of the security; relevant financial or business developments of the issuer; actively traded similar or related securities; conversion or exchange rights on the security; related corporate actions; significant events occurring after the close of trading in the security; and changes in overall market conditions. SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME - Security transactions are recorded by the fund as of the date the trades are executed with brokers. Interest income is recognized on an accrual basis. Market discounts, premiums and original issue discounts on fixed-income securities are amortized daily over the expected life of the security. CLASS ALLOCATIONS - Income, fees and expenses (other than class-specific fees and expenses) are allocated daily among the two share classes based on the relative value of their settled shares. Unrealized gains and losses are allocated daily among the two share classes based on their relative net assets. Class-specific fees and expenses, such as distribution, administrative and shareholder services, are charged directly to the respective share class. DIVIDENDS TO SHAREHOLDERS - Dividends paid to shareholders are declared daily after the determination of the fund's net investment income and are paid to shareholders monthly. 2. FEDERAL INCOME TAXATION AND DISTRIBUTIONS The fund complies with the requirements under Subchapter M of the Internal Revenue Code applicable to mutual funds and intends to distribute substantially all of its net taxable income each year. The fund is not subject to income taxes to the extent such distributions are made. Generally, income earned and distributed by the fund is exempt from federal income taxes. DISTRIBUTIONS - Distributions paid to shareholders are based on net investment income determined on a tax basis, which may differ from net investment income for financial reporting purposes. As of March 31, 2005, there were no material differences between book and tax reporting. The fiscal year in which amounts are distributed may differ from the year in which the net investment income is recorded by the fund. As of March 31, 2005, the cost of investment securities for federal income tax purposes was $412,467,000. As of March 31, 2005, the components of distributable earnings on a tax basis were as follows (dollars in thousands): Undistributed net investment income $62 Short-term loss carryforwards (expiring 2006-2011) (94) Gross unrealized depreciation on investment securities (23) Distributions paid or accrued to shareholders from ordinary income were as follows (dollars in thousands): SHARE CLASS SIX MONTHS ENDED MARCH 31, 2005 YEAR ENDED SEPTEMBER 30, 2004 Class A $ 2,397 $ 1,874 Class R-5 109 61 Total $ 2,506 $ 1,935
3. FEES AND TRANSACTIONS WITH RELATED PARTIES Capital Research and Management Company ("CRMC"), the fund's investment adviser, is the parent company of American Funds Service Company ("AFS"), the fund's transfer agent, and American Funds Distributors, Inc. ("AFD"), the principal underwriter of the fund's shares. INVESTMENT ADVISORY SERVICES - The Investment Advisory Agreement with CRMC provides for monthly fees accrued daily. These fees are based on a declining series of annual rates beginning with 0.390% on the first $200 million of daily net assets and decreasing to 0.290% on such assets in excess of $1.2 billion. During the six months ended March 31, 2005, CRMC reduced investment advisory services fees by $39,000. As a result, the fee shown on the accompanying financial statements of $781,000, which was equivalent to an annualized rate of 0.380%, was reduced to $742,000 or 0.361% of average daily net assets. CLASS-SPECIFIC FEES AND EXPENSES - Expenses that are specific to individual share classes are accrued directly to the respective share class. The principal class-specific fees and expenses are described below: DISTRIBUTION SERVICES - The fund has adopted a plan of distribution for Class A shares. Under the plan, the Board of Trustees approves certain categories of expenses that are used to finance activities primarily intended to sell fund shares. The plan provides for annual expenses, based on a percentage of average daily net assets, of up to 0.15%. This class may use a portion of average daily net assets to pay service fees, or to compensate AFD for paying service fees, to firms that have entered into agreements with AFD for providing certain shareholder services. TRANSFER AGENT SERVICES - The fund has a transfer agent agreement with AFS for Class A shares. Under this agreement, this share class compensates AFS for transfer agent services including shareholder recordkeeping, communications and transaction processing. AFS is also compensated for certain transfer agent services provided to Class R-5 from the administrative services fees paid to CRMC described below. ADMINISTRATIVE SERVICES - The fund has an administrative services agreement with CRMC to provide transfer agent and other related shareholder services for Class R-5. This class pays CRMC annual fees of 0.10% based on its average daily net assets. This class also pays AFS additional amounts for certain transfer agent services. CRMC and AFS may use these fees to compensate third parties for performing these services. DEFERRED TRUSTEES' COMPENSATION - Since the adoption of the deferred compensation plan in 1993, Trustees who are unaffiliated with CRMC may elect to defer the cash payment of part or all of their compensation. These deferred amounts, which remain as liabilities of the fund, are treated as if invested in shares of the fund. These amounts represent general, unsecured liabilities of the fund and vary according to the total return of the fund. Trustees' compensation in the accompanying financial statements includes the current fees (either paid in cash or deferred) and the net increase or decrease in the value of the deferred amounts. AFFILIATED OFFICERS AND TRUSTEES - Officers and certain Trustees of the fund are or may be considered to be affiliated with CRMC, AFS and AFD. No affiliated officers or Trustees received any compensation directly from the fund. 4. CAPITAL SHARE TRANSACTIONS Capital share transactions in the fund were as follows (dollars and shares in thousands): Share class Sales(1) Reinvestments of dividends Amount Shares Amount Shares Six months ended March 31, 2005 Class A $204,106 204,106 $ 2,242 2,242 Class R-5 41,884 41,884 65 65 Total net increase (decrease) $245,990 245,990 $ 2,307 2,307 Year ended September 30, 2004 Class A $490,187 490,187 $ 1,781 1,781 Class R-5 98,908 98,908 40 40 Total net increase (decrease) $589,095 589,095 $ 1,821 1,821 Share class Repurchases(1) Net (decrease) increase Amount Shares Amount Shares Six months ended March 31, 2005 Class A $ (228,863) (228,863) $ (22,515) (22,515) Class R-5 (42,090) (42,090) (141) (141) Total net increase (decrease) $ (270,953) (270,953) $ (22,656) (22,656) Year ended September 30, 2004 Class A $ (427,693) (427,693) $ 64,275 64,275 Class R-5 (87,436) (87,436) 11,512 11,512 Total net increase (decrease) $ (515,129) (515,129) $ 75,787 75,787
(1) Includes exchanges between share classes of the fund. 5. INVESTMENT TRANSACTIONS AND OTHER DISCLOSURES The fund receives a reduction in its custodian fee equal to the amount of interest calculated on certain cash balances held at the custodian bank. For the six months ended March 31, 2005, the custodian fee of $9,000, shown on the accompanying financial statements, includes $5,000 that was offset by this reduction, rather than paid in cash. FINANCIAL HIGHLIGHTS (1) Net asset Dividends value, Net from net beginning investment investment of period Income(2) income Class A: Six months ended 3/31/2005 (4) $1.00 $.006 $(.006) Year ended 9/30/2004 1.00 .005 (.005) Year ended 9/30/2003 1.00 .006 (.006) Year ended 9/30/2002 1.00 .010 (.010) Year ended 9/30/2001 1.00 .029 (.029) Year ended 9/30/2000 1.00 .032 (.032) Class R-5: Six months ended 3/31/2005 (4) 1.00 .006 (.006) Year ended 9/30/2004 1.00 .005 (.005) Year ended 9/30/2003 1.00 .005 (.005) Period from 7/15/2002 to 9/30/2002 1.00 .002 (.002) Net asset Net assets, value, end Total end of period of period return (in millions) Class A: Six months ended 3/31/2005 (4) $1.00 .61% $395 Year ended 9/30/2004 1.00 .49 418 Year ended 9/30/2003 1.00 .57 353 Year ended 9/30/2002 1.00 1.05 341 Year ended 9/30/2001 1.00 2.92 319 Year ended 9/30/2000 1.00 3.29 276 Class R-5: Six months ended 3/31/2005 (4) 1.00 .60 21 Year ended 9/30/2004 1.00 .45 21 Year ended 9/30/2003 1.00 .54 10 Period from 7/15/2002 to 9/30/2002 1.00 .17 10 Ratio of expenses Ratio of expenses to average to average Ratio of net assets net assets net income before after to average waivers waivers(3) net assets Class A: Six months ended 3/31/2005 (4) .55% (5) .53% (5) 1.22% (5) Year ended 9/30/2004 .53 .53 .49 Year ended 9/30/2003 .55 .55 .57 Year ended 9/30/2002 .54 .54 1.04 Year ended 9/30/2001 .52 .52 2.86 Year ended 9/30/2000 .64 .64 3.23 Class R-5: Six months ended 3/31/2005 (4) .58 (5) .56 (5) 1.20 (5) Year ended 9/30/2004 .57 .57 .47 Year ended 9/30/2003 .58 .58 .55 Period from 7/15/2002 to 9/30/2002 .12 .12 .17
(1) Based on operations for the period shown (unless otherwise noted) and, accordingly, may not be representative of a full year. (2) Based on average shares outstanding. (3) The ratios in this column reflect the impact, if any, of certain waivers from CRMC. During some of the periods shown, CRMC reduced fees for investment advisory services for all share classes. (4) Unaudited. (5) Annualized. See Notes to Financial Statements EXPENSE EXAMPLE (unaudited) As a shareholder of the fund, you incur two types of costs: (1) transaction costs such as initial sales charges on purchase payments and contingent deferred sales charges on redemptions (loads); and (2) ongoing costs, including management fees; distribution and service (12b-1) fees; and other expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the fund so you can compare these costs with the ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (October 1, 2004 through March 31, 2005). ACTUAL EXPENSES: The first line of each share class in the table on the next page provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled "Expenses paid during period" to estimate the expenses you paid on your account during this period. There are some account fees that are charged to certain types of accounts, such as Individual Retirement Accounts (generally, a $10 fee is charged to set up the account and an additional $10 fee is charged to the account annually) that would increase the amount of expenses paid on your account. In addition, retirement plan participants may be subject to certain fees charged by the plan sponsor. You can estimate the impact of these fees by adding the amount of the fees to the total estimated expenses you paid on your account during the period as calculated above. In addition, your ending account value would also be lower by the amount of these fees. HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES: The second line of each share class in the table on the next page provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio for the share class and an assumed rate of return of 5.00% per year before expenses, which is not the actual return of the share class. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the fund and other funds. To do so, compare this 5.00% hypothetical example with the 5.00% hypothetical examples that appear in the shareholder reports of the other funds. There are some account fees that are charged to certain shareholders, such as Individual Retirement Accounts (generally, a $10 fee is charged to set up the account and an additional $10 fee is charged to the account annually) that would increase the amount of expenses paid on your account. In addition, retirement plan participants may be subject to certain fees charged by the plan sponsor. You can estimate the impact of these fees by adding the amount of the fees to the total estimated expenses you paid on your account during the period as calculated on the previous page. In addition, your ending account value would also be lower by the amount of these fees. Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads). Therefore, the second line of each share class in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher. Beginning Ending Expenses account account paid Annualized value value during expense 10/01/2004 3/31/2005 period(1) ratio Class A -- actual return 1,000.00 $1,006.09 $2.65 .53% Class A -- assumed 5% return 1,000.00 1,022.29 2.67 .53 Class R-5 -- actual return 1,000.00 1,005.95 2.80 .56 Class R-5 -- assumed 5% return 1,000.00 1,022.14 2.82 .56
(1) Expenses are equal to the annualized expense ratio, multiplied by the average account value over the period, multiplied by the number of days in the period (182), and divided by 365 (to reflect the one-half year period). OFFICES OF THE FUNDS AND OF THE INVESTMENT ADVISER Capital Research and Management Company 333 South Hope Street Los Angeles, CA 90071-1406 135 South State College Boulevard Brea, CA 92821-5823 TRANSFER AGENT FOR SHAREHOLDER ACCOUNTS American Funds Service Company (Please write to the address nearest you.) P.O. Box 25065 Santa Ana, CA 92799-5065 P.O. Box 659522 San Antonio, TX 78265-9522 P.O. Box 6007 Indianapolis, IN 46206-6007 P.O. Box 2280 Norfolk, VA 23501-2280 CUSTODIAN OF ASSETS JPMorgan Chase Bank 270 Park Avenue New York, NY 10017-2070 COUNSEL Paul, Hastings, Janofsky & Walker LLP 515 South Flower Street Los Angeles, CA 90071-2228 INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM PricewaterhouseCoopers LLP 350 South Grand Avenue Los Angeles, CA 90071-2889 PRINCIPAL UNDERWRITER American Funds Distributors, Inc. 333 South Hope Street Los Angeles, CA 90071-1406 Most American Funds offer several share classes, each with its own sales charge and expense structure, allowing you to choose the one that best meets your financial needs. The three American Funds money market funds each offer Class A shares at no sales charge. The Cash Management Trust of America (CMTA) is the only American Funds money market fund that offers Class B, Class C, Class F and Class 529 shares. CMTA classes B, C and F shares may be acquired only by exchanging from other American Funds within the same share class (i.e., they may not be purchased directly) and do not offer check-writing privileges. American Funds classes B, C and F shares are subject to additional annualized expenses and fees, including, in the case of B and C shares, higher 12b-1 fees and contingent deferred sales charges if Class B shares are redeemed within six years of purchase and Class C shares are redeemed within one year of purchase. Classes B, C and F shares are not available to certain employer-sponsored retirement plans. See the CMTA prospectus for further details. INVESTORS SHOULD CAREFULLY CONSIDER THE INVESTMENT OBJECTIVES, RISKS, CHARGES AND EXPENSES OF THE AMERICAN FUNDS AND COLLEGEAMERICA. THIS AND OTHER IMPORTANT INFORMATION IS CONTAINED IN THE FUNDS' PROSPECTUS AND THE COLLEGEAMERICA PROGRAM DESCRIPTION, WHICH CAN BE OBTAINED FROM YOUR FINANCIAL ADVISER AND SHOULD BE READ CAREFULLY BEFORE INVESTING. YOU MAY ALSO CALL AMERICAN FUNDS SERVICE COMPANY (AFS) AT 800/421-0180 OR VISIT THE AMERICAN FUNDS WEBSITE AT AMERICANFUNDS.COM. "American Funds Proxy Voting Guidelines" -- which describes how we vote proxies relating to portfolio securities -- is available free of charge on the U.S. Securities and Exchange Commission (SEC) website at www.sec.gov, on the American Funds website or upon request by calling AFS. The funds' proxy voting records for the 12 months ended June 30, 2004, are also available on the SEC and American Funds websites. The Cash Management Trust of America, The U.S. Treasury Money Fund of America and The Tax-Exempt Money Fund of America file a complete list of their March 31, 2005, portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. These forms are available free of charge on the SEC website or upon request by calling AFS. You may also review or, for a fee, copy the forms at the SEC's Public Reference Room in Washington, D.C. (800/SEC-0330). This report is for the information of shareholders of The Cash Management Trust of America, The U.S. Treasury Money Fund of America and The Tax-Exempt Money Fund of America, but it may also be used as sales literature when preceded or accompanied by the current prospectus, which gives details about charges, expenses, investment objectives and operating policies of the funds. If used as sales material after June 30, 2005, this report must be accompanied by an American Funds statistical update for the most recently completed calendar quarter. [logo - AMERICAN FUNDS(R)] The right choice for the long term(R) WHAT MAKES AMERICAN FUNDS DIFFERENT? For more than 70 years, we have followed a consistent philosophy that we firmly believe is in our investors' best interests. The range of opportunities offered by our family of just 29 carefully conceived, broadly diversified funds has attracted over 30 million shareholder accounts. OUR UNIQUE COMBINATION OF STRENGTHS INCLUDES THESE FIVE FACTORS: o A LONG-TERM, VALUE-ORIENTED APPROACH Rather than follow fads, we pursue a consistent strategy, focusing on each investment's long-term potential. o AN UNPARALLELED GLOBAL RESEARCH EFFORT American Funds draws on one of the industry's most globally integrated research networks. o THE MULTIPLE PORTFOLIO COUNSELOR SYSTEM Every American Fund is divided among a number of portfolio counselors. Each takes responsibility for a portion independently, within each fund's objectives; in most cases, research analysts manage a portion as well. Over time this method has contributed to a consistency of results and continuity of management. o EXPERIENCED INVESTMENT PROFESSIONALS The recent market decline was not the first for most of the portfolio counselors who serve the American Funds. More than half of them were in the investment business before the sharp market decline of 1987. o A COMMITMENT TO LOW OPERATING EXPENSES American Funds' operating expenses are among the lowest in the mutual fund industry. Our portfolio turnover rates are low as well, keeping transaction costs and tax consequences contained. 29 MUTUAL FUNDS, CONSISTENT PHILOSOPHY, CONSISTENT RESULTS o GROWTH FUNDS AMCAP Fund(R) EuroPacific Growth Fund(R) The Growth Fund of America(R) The New Economy Fund(R) New Perspective Fund(R) New World Fund(SM) SMALLCAP World Fund(R) o GROWTH-AND-INCOME FUNDS American Mutual Fund(R) Capital World Growth and Income Fund(SM) Fundamental Investors(SM) The Investment Company of America(R) Washington Mutual Investors Fund(SM) o EQUITY-INCOME FUNDS Capital Income Builder(R) The Income Fund of America(R) o BALANCED FUND American Balanced Fund(R) o BOND FUNDS American High-Income Trust(SM) The Bond Fund of America(SM) Capital World Bond Fund(R) Intermediate Bond Fund of America(R) U.S. Government Securities Fund(SM) o TAX-EXEMPT BOND FUNDS American High-Income Municipal Bond Fund(R) Limited Term Tax-Exempt Bond Fund of America(SM) The Tax-Exempt Bond Fund of America(R) STATE-SPECIFIC TAX-EXEMPT FUNDS The Tax-Exempt Fund of California(R) The Tax-Exempt Fund of Maryland(R) The Tax-Exempt Fund of Virginia(R) o MONEY MARKET FUNDS The Cash Management Trust of America(R) The Tax-Exempt Money Fund of America (SM) The U.S. Treasury Money Fund of America (SM) THE CAPITAL GROUP COMPANIES American Funds Capital Research and Management Capital International Capital Guardian Capital Bank and Trust Lit. No. MFGESR-960-0505P Litho in USA AGD/INS/8090-S1942 Printed on recycled paper ITEM 2 - Code of Ethics Not applicable for filing of Semiannual Reports to Shareholders. ITEM 3 - Audit Committee Financial Expert Not applicable for filing of Semiannual Reports to Shareholders. ITEM 4 - Principal Accountant Fees and Services Not applicable for filing of Semiannual Reports to Shareholders. ITEM 5 - Audit Committee of Listed Registrants Not applicable. ITEM 6 - Schedule of Investments Not applicable, insofar as the schedule is included as part of the report to shareholders filed under Item 1 of this Form ITEM 7 - Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies Not applicable to this Registrant, insofar as the Registrant is not a closed-end management investment company. ITEM 8 - Portfolio Managers of Closed-End Management Investment Companies Not applicable to this Registrant, insofar as the Registrant is not a closed-end management investment company. ITEM 9 - Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers Not applicable to this Registrant, insofar as the Registrant is not a closed-end management investment company. ITEM 10 - Submission of Matters to a Vote of Security Holders There have been no material changes to the procedures by which shareholders may recommend nominees to the Registrant's Board of Trustees since the Registrant last submitted a proxy statement to its shareholders. The procedures are as follows. The Registrant has a Nominating and Governance Committee comprised solely of persons who are not considered ``interested persons'' of the Registrant within the meaning of the Investment Company Act of 1940, as amended. The committee periodically reviews such issues as the Board's composition, responsibilities, committees, compensation and other relevant issues, and recommends any appropriate changes to the full Board of Trustees. While the committee normally is able to identify from its own resources an ample number of qualified candidates, it will consider shareholder suggestions of persons to be considered as nominees to fill future vacancies on the Board. Such suggestions must be sent in writing to the Nominating and Governance Committee of the Registrant, c/o the Registrant's Secretary, and must be accompanied by complete biographical and occupational data on the prospective nominee, along with a written consent of the prospective nominee for consideration of his or her name by the Nominating and Governance Committee. ITEM 11 - Controls and Procedures (a) The Registrant's Principal Executive Officer and Principal Financial Officer have concluded, based on their evaluation of the Registrant's disclosure controls and procedures (as such term is defined in Rule 30a-3 under the Investment Company Act of 1940), that such controls and procedures are adequate and reasonably designed to achieve the purposes described in paragraph (c) of such rule. (b) There were no changes in the Registrant's internal controls over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) that occurred during the Registrant's second fiscal quarter 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 (a) (1) The Code of Ethics - not applicable for filing of Semiannual Reports to Shareholders. (a) (2) The certifications required by Rule 30a-2 of the Investment Company Act of 1940, as amended, and Sections 302 and 906 of the Sarbanes-Oxley Act of 2002 are attached as exhibits hereto. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. THE CASH MANAGEMENT TRUST OF AMERICA By /s/ Abner D. Goldstine ------------------------------------- Abner D. Goldstine, President and PEO Date: June 8, 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/ Abner D. Goldstine ------------------------------------- Abner D. Goldstine, President and PEO Date: June 8, 2005 By /s/ Susi M. Silverman ------------------------------------ Susi M. Silverman, Treasurer and PFO Date: June 8, 2005