<DOCUMENT>
<TYPE>N-30D
<SEQUENCE>1
<FILENAME>s6320y.txt
<DESCRIPTION>AXP CASH MANAGEMENT FUND
<TEXT>
AXP(R)
Cash
Management
Fund
2002 ANNUAL REPORT
(Prospectus Enclosed)
AXP Cash Management Fund seeks to provide shareholders with maximum current
income consistent with liquidity and stability of principal.
(This annual report includes a prospectus that describes in detail the Fund's
objective, investment strategy, risks, sales charges, fees and other matters of
interest. Please read the prospectus carefully before you invest or send money.)
American
Express(R)
Funds
AMERICAN
EXPRESS(R)
<PAGE>
From the Chairman
(photo of) Arne H. Carlson
Arne H. Carlson
Chairman of the board
Dear Shareholders,
It is a very difficult period for investors caused by corporate management
misconduct and its impact on the market as well as the economy. The integrity of
corporations at large is being questioned. However, there is optimism that the
resulting reforms will give Americans the kind of integrity they deserve. Many
corporate leaders are strongly supportive of these reforms. We all have a right
to expect financial statements to be fully accurate and business leaders to
place the interests of shareholders above personal desires. Your Board is truly
independent, comprised of 12 members (nominated by independent members) and
three recommended by American Express Financial Corporation. These individuals
come from a variety of geographic areas with the diverse skill sets necessary to
oversee the operations of the Fund. Investment performance is, and remains, our
primary concern.
The Fund's auditors, KPMG LLP, are truly independent of American Express
Financial Corporation. KPMG serves the interest of shareholders by supporting
the work of the Board and certifying unbiased financial reports.
The Board has confidence in Ted Truscott, American Express Financial
Corporation's new Chief Investment Officer, and shares his enthusiasm in the
management changes he has effected to improve the investment performance of all
American Express funds. These changes include the hiring of several new
portfolio managers and investment leaders and the addition of eight sub-advised
funds. The focus of the Board and American Express Financial Corporation is
simple; we strive for consistent, competitive investment performance.
If you were a shareholder of record on September 14, you will receive a proxy
statement for a shareholder meeting to be held on November 13, 2002. Please take
time to consider each proposal and vote promptly.
On behalf of the Board,
Arne H. Carlson
CONTENTS
From the Chairman 2
Economic and Market Update 3
Fund Snapshot 5
Questions & Answers
with Portfolio Management 6
Investments in Securities 8
Financial Statements 13
Notes to Financial Statements 16
Independent Auditors' Report 21
Federal Income Tax Information 22
Board Members and Officers 24
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2 -- AXP CASH MANAGEMENT FUND -- 2002 ANNUAL REPORT
<PAGE>
Economic and Market Update
FROM CIO WILLIAM F. "TED" TRUSCOTT
(photo of) William F. "Ted" Truscott
William F. "Ted" Truscott
Chief Investment Officer
American Express
Financial Corporation
Dear Shareholders,
Major U.S. financial markets lost ground for the three-month period ending July
31, 2002, although a late rally put them above earlier lows. The same factors
that have driven markets down for most of the year so far were still in play
during this period. These include concerns about the truthfulness of accounting
practices and the perception that stocks remain too expensive relative to
company earnings. I expect we'll need to see consistent improvement in earnings
before stocks rebound significantly. If corporate revenue growth becomes
apparent and widespread, it will effectively make stock valuations cheaper.
Increased demand should then have a positive impact on prices.
Economic fundamentals have continued to look positive despite volatility in the
financial markets. Inflation and interest rates remain low, unemployment and job
growth are at reasonable levels, and there are signs that business spending is
beginning to pick up. In addition, a weaker dollar should help U.S. companies
that export goods overseas, even though it crimps our wallets when we travel
abroad. These and other factors make it highly unlikely that we will experience
a so-called "double-dip" recession. I remain optimistic about the direction of
the economy and believe that, eventually, markets will start paying attention to
these very favorable conditions.
Nevertheless, we should remember that risk still exists. For one, bonds have
been experiencing their own bear market. This has created something of a credit
crunch for businesses, as liquidity declines and spreads widen. Related to this
has been a crisis of confidence -- the unfortunate legacy of recent corporate
scandal. In some cases, investors who thought they were buying high-quality
corporate bonds were actually getting riskier high-yield securities due to
dishonest accounting. Everyone agrees that some type of reform is needed, but
the challenge for regulators will be to discourage misleading practices without
sacrificing entrepreneurial incentive. Prudent regulation will boost confidence,
while misguided efforts will simply make markets less efficient.
What I think all investors need to understand is that we're still working
through the excess capacity and inflated demand forecasts that were created in
the late `90s. This process has been painful, but it has helped to reorient
expectations to levels that are more sustainable. Historically speaking, the
late `90s were an aberration and will likely not be repeated soon.
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3 -- AXP CASH MANAGEMENT FUND -- 2002 ANNUAL REPORT
<PAGE>
Economic and Market Update
However, a more sober outlook need not be cause for special concern. We should
all ask ourselves, "Have my goals changed in the last couple of years?" For many
of us, the answer will be "no." If you're saving for long-term goals like
retirement, I would still advise a substantial weighting in equities for your
portfolio. Over time, stocks will probably continue to outperform bonds or other
investments. And if you're in retirement or getting close, you may want to
invest more heavily in bonds and cash, with a smaller portion devoted to
equities.
See your financial advisor or retirement plan administrator for more information
about different types of securities and asset allocation.
As always, thank you for investing with American Express Financial Advisors.
William F. Truscott
KEY POINTS
-- Economic fundamentals remain positive.
-- Credit "crunch" for business sector persists.
-- Re-evaluation of personal financial goals key.
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4 -- AXP CASH MANAGEMENT FUND -- 2002 ANNUAL REPORT
<PAGE>
Fund Snapshot
AS OF JULY 31, 2002
PORTFOLIO MANAGER
Portfolio manager Mary McQuillen
Tenure/since 1/15/02
Years in industry 23
FUND OBJECTIVE
For investors seeking maximum current income consistent with liquidity and
stability of principal.
Inception dates
A: 10/6/75 B: 3/20/95 C: 6/26/00 Y: 3/20/95
Ticker symbols
A: IDSXX B: ACBXX C: -- Y: IDYXX
Total net assets $6.352 billion
Number of holdings approximately 280
For the period, the Fund's 7-day yield was 1.26%.
STYLE MATRIX
DURATION
SHORT INT. LONG
X HIGH
MEDIUM QUALITY
LOW
PORTFOLIO ASSET MIX
Percentage of portfolio assets
(pie graph)
U.S. government agencies 24.5%
Certificates of deposit 8.3%
Commercial paper 67.2%
An investment in the Fund is not insured or guaranteed by the Federal Deposit
Insurance Corporation or any other government agency. Although the Fund seeks to
preserve the value of your investment at $1.00 per share, it is possible to lose
money by investing in the Fund.
Fund holdings are subject to change.
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5 -- AXP CASH MANAGEMENT FUND -- 2002 ANNUAL REPORT
<PAGE>
Questions & Answers
WITH PORTFOLIO MANAGEMENT
Q: How did the Fund perform for the 12-month period ended July 31, 2002?
A: The Fund's yield fell during the 12-month period, reflecting a decline in
short-term interest rates. For the period, the Fund's Class A shares
returned 1.93% and its seven-day yield was 1.26%. As it has historically,
the Fund maintained a $1 per share net asset value throughout the period,
in accordance with its objective.(1)
Q: What factors most significantly impacted performance?
A: The main factors affecting the Fund's performance are the actions of the
Federal Reserve Board (the Fed), the overall Treasury yield curve and the
average maturity of the Fund. As the economic recovery remained slow, the
Fed aggressively cut short-term interest rates resulting in one of the
lowest interest rate environments we have seen in many years. Despite the
absolute low level of rates, the Fund's performance has been above the mean
for the period, beating the average(2) by about 15 to 20 basis points.
Q: What changes to the Portfolio did you make this period?
A: Given overall expectation that interest rates are headed lower, we
lengthened the Fund's average maturity. Longer-term securities offered a
higher interest rate and an ability to lock in those rates. We believed
that was more attractive than having to continually reinvest in
shorter-term securities in a market where yields were declining. More
recently, we have adopted a more conservative stance as a result of the
turbulent commercial paper market. We've increased our allocation to
government and agency paper, which typically offers a relatively lower
yield.
Q: What is your outlook for the months ahead?
A: The Fund outlook for the remainder of the year will in a large sense depend
on Federal Reserve expectations. While there are signs that an economic
recovery may be underway, we expect it to be a rather slow-moving rebound.
We expect the federal funds rate(3) to increase, but not until 2003. We
will wait for these higher rates to extend the average maturity of the
(1) Past performance does not guarantee future results. The Fund is neither
insured nor guaranteed by the FDIC (Federal Deposit Insurance Corporation)
or any other government agency. Yields will fluctuate. Although the Fund
seeks to preserve the value of your investment at $1 per share, it is
possible to lose money by investing in the Fund. The seven-day current
yield more closely reflects the current earnings of the Fund than the total
return.
(2) Based on information from Money Market Institute, a weekly publication
capturing the industry's weekly money market fund report based on all money
market funds.
(3) The federal funds rate is the interest rate charged by one institution
lending federal funds to another. (In other words, it's the interest rate
banks charge each other for loans.)
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6 -- AXP CASH MANAGEMENT FUND -- 2002 ANNUAL REPORT
<PAGE>
Questions & Answers
(begin callout quote)> More recently, we have adopted a more conservative stance
as a result of the turbulent commercial paper market. (end callout quote)
Fund. We expect stabilization in the commercial paper market as the
recovery moves forward. As always, we are focused on an investment approach
designed to maintain the Fund's stable net asset value first, and
secondarily, on maximizing dividend income for our shareholders.
AVERAGE ANNUAL TOTAL RETURNS
as of July 31, 2002
At Net Asset
Value (NAV)* Class A Class B Class C Class Y
1 year +1.93% +1.13% +1.14% +1.95%
5 years +4.58% +3.79% N/A +4.59%
10 years +4.30% N/A N/A N/A
Since inception N/A +4.02%** +3.0 +4.82%**
With Sales Charge Class A Class B Class C Class Y
1 year +1.93% -2.87% +1.14% +1.95%
5 years +4.58% +3.62% N/A +4.59%
10 years +4.30% N/A N/A N/A
Since inception N/A +4.02%** +3.0 +4.82%**
For the period, the Fund's 7-day yield was 1.26%.
* Excluding sales charge.
** Inception date was March 20, 1995.
*** Inception date was June 26, 2000.
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, so that your shares, when redeemed, may be worth
more or less than the original cost. The performance shown for each class of
shares will vary due to differences in sales charges and fees. Short term
performance may be higher or lower than the figures shown. Visit
americanexpress.com for current information.
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7 -- AXP CASH MANAGEMENT FUND -- 2002 ANNUAL REPORT
<PAGE>
Investments in Securities
AXP Cash Management Fund
July 31, 2002
(Percentages represent value of investments compared to net assets)
U.S. government agencies (24.4%)
Issuer Annualized Amount Value(a)
Yield on date payable at
of purchase maturity
Federal Home Loan Bank Disc Nts
08-02-02 1.71% $14,800,000 $14,799,297
08-14-02 1.78 22,000,000 21,985,859
08-26-02 1.72 17,400,000 17,379,217
08-30-02 1.74 24,750,000 24,715,309
09-04-02 1.71 18,400,000 18,370,284
09-13-02 1.69 8,600,000 8,582,640
09-18-02 1.73 6,300,000 6,285,468
10-09-02 1.74 18,700,000 18,637,994
10-11-02 1.74 35,000,000 34,880,582
11-06-02 1.74 28,600,000 28,466,684
Federal Home Loan Mtge Corp Disc Nts
08-08-02 1.77 36,700,000 36,687,405
08-09-02 1.83 5,600,000 5,597,723
08-09-02 1.86 50,000,000 49,979,332
08-09-02 1.95 30,000,000 29,987,000
08-20-02 1.71 26,500,000 26,476,084
08-21-02 1.78 31,800,000 31,768,553
08-22-02 1.74 62,500,000 62,436,700
08-23-02 1.77 7,000,000 6,992,428
08-23-02 1.78 83,200,000 83,109,496
08-27-02 1.72 9,600,000 9,588,075
08-29-02 1.75 38,700,000 38,647,325
09-03-02 1.72 24,300,000 24,261,687
09-05-02 1.73 29,900,000 29,849,710
09-12-02 1.72 21,200,000 21,157,459
09-12-02 1.73 23,400,000 23,352,771
09-24-02 1.69 34,600,000 34,512,289
09-26-02 1.71 46,400,000 46,276,576
10-10-02 1.74 35,900,000 35,778,887
10-24-02 1.65 29,000,000 28,889,027
11-22-02 1.74 29,600,000 29,439,264
12-30-02 1.74 17,700,000 17,571,562
12-30-02 1.75 15,500,000 15,386,876
Federal Natl Mtge Assn Disc Nts
08-05-02 1.85 10,600,000 10,597,821
08-07-02 1.77 23,000,000 22,993,215
08-13-02 1.94 39,000,000 38,974,780
08-14-02 1.77 25,000,000 24,984,021
08-14-02 1.97 34,000,000 33,975,813
08-16-02 1.71 42,700,000 42,669,576
08-28-02 1.74 38,000,000 37,950,410
08-28-02 1.75 60,800,000 60,720,333
09-04-02 1.74 29,600,000 29,551,357
09-04-02 1.75 30,100,000 30,050,394
09-11-02 1.71 24,600,000 24,552,092
09-11-02 1.72 52,100,000 51,997,942
09-11-02 1.73 18,200,000 18,164,141
09-11-02 1.74 23,000,000 22,954,422
09-18-02 1.72 32,900,000 32,824,549
09-18-02 1.74 11,100,000 11,074,248
09-25-02 1.72 39,000,000 38,897,516
09-25-02 1.73 11,700,000 11,669,076
11-29-02 1.78 25,200,000 25,051,320
12-04-02 1.73 36,800,000 36,580,222
12-11-02 1.73 24,800,000 24,643,595
12-13-02 1.74 39,500,000 39,245,642
Total U.S. Government Agencies
(Cost: $1,551,972,048) $1,551,972,048
See accompanying notes to investments in securities.
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8 -- AXP CASH MANAGEMENT FUND -- 2002 ANNUAL REPORT
<PAGE>
Certificates of deposit (8.3%)
Issuer Annualized Amount Value(a)
Yield on date payable at
of purchase maturity
Barclays Bank Yankee
09-10-02 1.79% $23,000,000 $23,000,000
11-07-02 1.80 31,200,000 31,200,000
BNP Paribas Yankee
09-06-02 1.79 31,400,000 31,400,000
09-09-02 1.79 29,000,000 29,000,000
11-08-02 1.78 25,000,000 25,000,000
11-14-02 1.83 17,000,000 17,000,000
11-18-02 1.81 24,000,000 24,000,000
01-14-03 1.83 24,200,000 24,200,000
01-17-03 1.84 18,000,000 18,000,000
Canadian Imperial Bank of Commerce Yankee
10-15-02 1.78 30,000,000 30,000,000
01-15-03 1.83 30,000,000 30,000,000
Credit Agricole Indosuez Yankee
08-19-02 1.88 31,000,000 31,000,000
11-15-02 1.83 18,000,000 18,000,000
Societe Generale Yankee
11-21-02 1.84 24,700,000 24,700,000
Westdeutsche Landesbank Yankee
08-15-02 1.87 22,000,000 22,000,000
08-19-02 1.89 20,000,000 20,000,000
08-29-02 1.81 22,900,000 22,900,000
10-18-02 1.80 28,000,000 28,000,000
11-22-02 1.84 30,000,000 30,000,000
11-25-02 1.84 22,400,000 22,400,000
01-21-03 1.78 26,600,000 26,600,000
Total Certificates of deposit
(Cost: $528,400,000) $528,400,000
Commercial paper (67.0%)
Issuer Annualized Amount Value(a)
Yield on date payable at
of purchase maturity
Asset-backed (33.1%)
Alpine Securitization
08-26-02 1.80% $30,200,000(b) $30,162,250
09-19-02 1.80 20,000,000(b) 19,951,000
10-02-02 1.79 21,000,000(b) 20,935,623
11-22-02 1.76 25,000,000(b) 24,862,674
Amsterdam Funding
08-02-02 1.80 20,000,000(b) 19,999,000
09-17-02 1.78 26,000,000(b) 25,939,579
10-01-02 1.78 22,500,000(b) 22,432,519
11-14-02 1.80 26,300,000(b) 26,162,692
Barton Capital
08-19-02 1.81 21,000,000(b) 20,980,995
08-21-02 1.81 27,000,000(b) 26,972,850
09-06-02 1.81 21,600,000(b) 21,560,904
10-04-02 1.81 15,000,000(b) 14,952,000
10-11-02 1.80 31,677,000(b) 31,565,171
CAFCO
08-08-02 1.82 30,000,000(b) 29,989,384
08-22-02 1.82 15,000,000(b) 14,984,075
09-03-02 1.80 53,000,000(b) 52,912,550
09-06-02 1.80 15,200,000(b) 15,172,640
09-09-02 1.79 19,600,000(b) 19,561,992
Charta
08-02-02 1.81 26,000,000(b) 25,998,693
08-05-02 1.81 26,000,000(b) 25,994,771
08-21-02 1.80 27,000,000(b) 26,973,000
08-27-02 1.80 24,000,000(b) 23,968,800
08-30-02 1.81 22,000,000(b) 21,967,923
Ciesco LP
08-12-02 1.74 15,000,000 14,992,025
09-04-02 1.80 25,000,000 24,957,500
09-13-02 1.78 19,200,000 19,159,293
09-19-02 1.78 28,000,000 27,932,162
Corporate Receivables
08-05-02 1.82 30,000,000(b) 29,993,933
08-08-02 1.81 25,000,000(b) 24,991,201
08-27-02 1.80 23,000,000(b) 22,970,100
09-10-02 1.78 8,700,000(b) 8,682,793
10-03-02 1.81 25,500,000(b) 25,419,675
CXC
08-02-02 1.82 30,000,000(b) 29,998,483
08-20-02 1.82 25,000,000(b) 24,975,986
08-22-02 1.81 19,000,000(b) 18,979,939
08-28-02 1.80 17,000,000(b) 16,977,050
10-17-02 1.79 8,600,000(b) 8,567,258
See accompanying notes to investments in securities.
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9 -- AXP CASH MANAGEMENT FUND -- 2002 ANNUAL REPORT
<PAGE>
Commercial paper (continued)
Issuer Annualized Amount Value(a)
Yield on date payable at
of purchase maturity
Asset-backed (continued)
Delaware Funding
09-13-02 1.78% $26,000,000(b) $25,944,721
Edison Asset Securitization
08-01-02 2.04 28,000,000(b) 28,000,000
08-07-02 1.93 30,000,000(b) 29,990,350
08-19-02 1.88 33,500,000(b) 33,468,510
01-10-03 1.84 30,000,000(b) 29,754,300
Enterprise Funding
08-06-02 1.81 30,000,000(b) 29,992,458
08-27-02 1.83 6,928,000(b) 6,918,843
09-11-02 1.78 11,033,000(b) 11,010,634
09-20-02 1.78 12,105,000(b) 12,075,074
10-15-02 1.79 31,000,000(b) 30,885,042
Falcon Asset Securitization
08-12-02 1.81 4,056,000(b) 4,053,757
09-05-02 1.81 23,632,000(b) 23,590,414
09-20-02 1.78 24,101,000(b) 24,041,417
10-07-02 1.80 15,000,000(b) 14,950,029
10-15-02 1.79 15,583,000(b) 15,525,213
11-05-02 1.80 15,000,000(b) 14,928,400
Fleet Funding
08-06-02 1.82 25,000,000(b) 24,993,681
08-16-02 1.92 29,500,000(b) 29,476,400
08-20-02 1.84 19,000,000(b) 18,981,549
08-21-02 1.85 19,500,000(b) 19,479,958
09-24-02 1.75 28,000,000(b) 27,926,500
Kitty Hawk Funding
08-09-02 2.10 6,000,000(b) 5,997,200
08-30-02 1.83 8,088,000(b) 8,076,077
09-06-02 1.79 22,000,000(b) 21,960,620
09-09-02 1.81 8,039,000(B) 8,023,237
09-13-02 1.78 18,689,000(b) 18,649,265
09-30-02 1.78 21,000,000(b) 20,938,050
10-22-02 1.79 20,000,000(b) 19,918,911
Old Line Funding
08-05-02 1.81 16,732,000(b) 16,728,635
08-06-02 1.81 13,945,000(b) 13,941,494
08-16-02 1.81 13,835,000(b) 13,824,566
08-19-02 1.80 4,000,000(b) 3,996,400
08-20-02 1.83 15,093,000(b) 15,078,423
09-13-02 1.80 27,000,000(b) 26,941,950
09-19-02 1.76 7,029,000(b) 7,012,162
10-01-02 1.79 16,036,000(b) 15,987,634
Park Avenue Receivables
08-06-02 1.79 30,000,000(b) 29,992,542
08-07-02 1.79 15,000,000(b) 14,995,525
08-13-02 1.78 23,000,000(b) 22,986,353
09-17-02 1.78 5,000,000(b) 4,988,381
Preferred Receivables Funding
08-06-02 1.79 20,000,000(b) 19,995,028
08-29-02 1.81 25,000,000(b) 24,964,806
08-29-02 1.82 25,000,000(b) 24,964,611
09-03-02 1.77 22,500,000(b) 22,463,494
10-24-02 1.76 14,215,000(b) 14,156,955
Receivables Capital
08-16-02 1.82 19,695,000(b) 19,680,065
08-30-02 1.79 17,000,000(b) 16,975,487
09-12-02 1.78 22,000,000(b) 21,954,313
09-16-02 1.78 25,000,000(b) 24,943,139
Sheffield Receivables
08-15-02 1.81 24,630,000(b) 24,612,663
08-28-02 1.75 30,000,000(b) 29,960,625
09-10-02 1.80 10,000,000(b) 9,980,000
09-20-02 1.78 19,700,000(b) 19,651,297
Variable Funding Capital
08-07-02 1.78 20,000,000(b) 19,994,067
08-07-02 1.80 19,000,000(b) 18,994,300
09-05-02 1.81 26,000,000(b) 25,954,247
10-02-02 1.79 23,000,000(b) 22,929,492
01-16-03 1.83 8,000,000(b) 7,932,427
Windmill Funding
08-02-02 1.79 21,000,000(b) 20,998,956
08-22-02 1.81 21,000,000(b) 20,977,828
08-26-02 1.82 26,000,000(b) 25,967,229
09-23-02 1.78 26,000,000(b) 25,931,866
11-13-02 1.80 29,200,000(b) 29,049,004
Total 2,101,655,057
Banks and savings & loans (11.1%)
Abbey Natl North America
08-12-02 2.00 22,000,000 21,986,556
08-30-02 1.81 27,000,000 26,960,741
Barclays U.S. Funding
08-15-02 1.81 28,500,000 28,479,939
08-16-02 1.80 31,000,000 30,976,750
10-10-02 1.79 23,800,000 23,717,626
10-18-02 1.79 26,000,000 25,899,727
See accompanying notes to investments in securities.
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10 -- AXP CASH MANAGEMENT FUND -- 2002 ANNUAL REPORT
<PAGE>
Commercial paper (continued)
Issuer Annualized Amount Value(a)
Yield on date payable at
of purchase maturity
Banks and savings & loans (continued)
Dresdner US Finance
08-07-02 2.05% $30,000,000 $29,989,750
08-09-02 2.04 29,000,000 28,986,853
08-13-02 2.03 26,100,000 26,082,339
11-20-02 1.84 28,000,000 27,842,010
ING US Funding
08-01-02 2.01 30,000,000 30,000,000
Natl Australia Funding (Delaware)
08-14-02 2.00 27,000,000 26,980,500
Nordea North America
08-15-02 1.82 30,000,000 29,978,767
08-20-02 1.80 23,500,000 23,477,675
09-04-02 1.79 23,000,000 22,961,117
09-20-02 1.78 28,500,000 28,429,542
10-11-02 1.79 40,000,000 39,859,578
10-21-02 1.81 40,000,000 39,838,000
10-21-02 1.82 15,000,000 14,938,913
11-26-02 1.81 26,000,000 25,847,900
Rabobank Nederland
08-07-02 2.06 30,000,000 29,989,700
Societe Generale North America
08-01-02 1.84 65,000,000 64,999,998
08-23-02 1.82 10,650,000 10,638,155
08-23-02 1.83 25,000,000 24,972,042
11-19-02 1.81 20,000,000 19,890,000
Total 703,724,178
Broker dealers (3.0%)
Goldman Sachs Group
08-02-02 2.05 30,000,000 29,998,292
08-06-02 2.03 11,500,000 11,496,758
08-08-02 2.05 22,000,000 21,991,231
12-12-02 1.80 18,000,000(c) 18,000,000
Merrill Lynch
03-05-03 1.82 18,000,000(c) 18,000,000
Salomon Smith Barney
09-06-02 1.80 28,600,000 28,548,520
11-12-02 1.80 28,100,000 27,956,089
11-26-02 1.78 32,000,000 31,815,919
Total 187,806,809
Commercial finance (1.2%)
Nestle Capital
08-12-02 2.04 27,500,000(b) 27,482,900
08-15-02 1.94 15,000,000(b) 14,988,683
08-16-02 1.87 34,000,000(b) 33,973,509
Total 76,445,092
Energy (0.5%)
Chevron Transport
08-06-02 2.00 21,000,000(b) 20,994,166
Chevron UK Investment
08-08-02 1.80 3,300,000(b) 3,298,845
08-14-02 1.81 5,100,000(b) 5,096,667
Total 29,389,678
Financial services (8.9%)
AEGON Funding
12-19-02 1.78 29,000,000(b) 28,800,383
12-19-02 1.79 21,500,000(b) 21,351,172
12-20-02 1.79 23,000,000(b) 22,839,652
01-17-03 1.81 56,000,000(b) 55,529,429
01-17-03 1.84 30,000,000(b) 29,743,683
01-28-03 1.82 27,500,000(b) 27,252,500
Caterpillar Financial Services
08-07-02 1.92 9,000,000 8,997,120
08-13-02 1.92 9,150,000 9,144,144
Intl Lease Finance
08-20-02 1.81 10,000,000 9,990,447
09-23-02 1.75 6,150,000 6,134,155
10-22-02 1.81 30,000,000 29,877,000
11-19-02 1.79 20,000,000 19,891,222
01-07-03 1.81 19,000,000 18,848,950
01-08-03 1.80 23,200,000 23,015,431
Southern Co Funding
08-09-02 1.81 14,000,000(b) 13,994,369
08-22-02 1.82 5,000,000(b) 4,994,692
09-09-02 1.78 25,000,000(b) 24,951,792
09-12-02 1.82 13,000,000(b) 12,972,397
10-09-02 1.79 13,000,000(b) 12,955,648
10-16-02 1.79 32,800,000(b) 32,676,744
11-06-02 1.79 21,245,000(b) 21,143,107
Verizon Global Funding
08-21-02 1.85 15,000,000(b) 14,984,583
10-17-02 1.81 6,400,000(b) 6,375,360
Verizon Network Funding
08-21-02 1.81 19,245,000 19,225,648
08-26-02 1.81 24,150,000 24,119,645
08-27-02 1.83 30,708,000 30,667,415
10-15-02 1.81 10,000,000 9,962,500
11-15-02 1.95 25,292,000 25,147,526
Total 565,586,714
See accompanying notes to investments in securities.
--------------------------------------------------------------------------------
11 -- AXP CASH MANAGEMENT FUND -- 2002 ANNUAL REPORT
<PAGE>
Commercial paper (continued)
Issuer Annualized Amount Value(a)
Yield on date payable at
of purchase maturity
Health care (0.2%)
Pfizer
08-02-02 1.75% $10,000,000(b) $9,999,514
Household products (0.4%)
Procter & Gamble
10-17-02 1.74 25,000,000(b) 24,907,493
Insurance (0.3%)
Marsh & McLennan
10-24-02 1.81 19,050,000(b) 18,969,990
Media (0.4%)
Gannett
08-12-02 1.75 20,000,000(b) 19,989,305
08-19-02 1.75 7,300,000(b) 7,293,613
Total 27,282,918
Metals (0.5%)
Alcoa
09-20-02 1.76 35,000,000 34,914,444
Multi-industry conglomerates (2.4%)
GE Capital Intl Funding
08-12-02 1.80 20,000,000(b) 19,989,000
08-20-02 1.80 25,000,000(b) 24,976,250
08-27-02 1.84 19,000,000(b) 18,974,751
08-28-02 1.85 15,000,000(b) 14,979,188
09-05-02 1.80 28,000,000(b) 27,951,000
01-27-03 1.81 29,000,000(b) 28,741,892
General Electric Capital
08-14-02 2.14 20,000,000 19,984,544
Total 155,596,625
Utilities -- electric (3.9%)
Duke Energy
09-24-02 1.75 30,000,000 29,921,250
10-04-02 1.79 19,600,000 19,537,977
11-18-02 1.79 10,000,000 9,946,106
11-19-02 1.79 10,000,000 9,945,611
11-20-02 1.79 23,000,000 22,873,768
11-21-02 1.79 30,000,000 29,833,867
11-27-02 1.78 43,000,000 42,750,528
01-03-03 1.78 25,000,000 24,809,479
01-06-03 1.81 33,000,000 32,739,300
UBS Finance (Delaware)
08-05-02 1.99 28,000,000 27,993,809
Total 250,351,695
Utilities -- telephone (1.1%)
SBC Intl
09-04-02 1.79 17,000,000(b) 16,971,261
09-10-02 1.79 20,380,000(b) 20,339,466
09-17-02 1.77 30,000,000(b) 29,930,675
Total 67,241,402
Total commercial paper
(Cost: $4,253,871,609) $4,253,871,609
Total investments in securities
(Cost: $6,334,243,657)(d) $6,334,243,657
Notes to investments in securities
(a) Securities are valued by procedures described in Note 1 to the financial
statements.
(b) Commercial paper sold within terms of a private placement memorandum,
exempt from registration under Section 4(2) of the Securities Act of 1933,
as amended, and may be sold only to dealers in that program or other
"accredited investors." This security has been determined to be liquid
under guidelines established by the board.
(c) Interest rate varies either based on a predetermined schedule or to reflect
current market conditions; rate shown is the effective rate on July 31,
2002.
(d) Also represents the cost of securities for federal income tax purposes at
July 31, 2002.
--------------------------------------------------------------------------------
12 -- AXP CASH MANAGEMENT FUND -- 2002 ANNUAL REPORT
<PAGE>
Financial Statements
<TABLE>
<CAPTION>
Statement of assets and liabilities
AXP Cash Management Fund
July 31, 2002
Assets
<S> <C> <C>
Investments in securities, at value (Note 1)
(identified cost $6,334,243,657) $6,334,243,657
Cash in bank on demand deposit 18,510,412
Capital shares receivable 168,600
Accrued interest receivable 1,224,610
--------------
Total assets 6,354,147,279
-------------
Liabilities
Dividends payable to shareholders 1,255,108
Capital shares payable 80,362
Accrued investment management services fee 52,365
Accrued distribution fee 7,910
Accrued transfer agency fee 7,785
Accrued administrative services fee 3,953
Other accrued expenses 729,424
--------------
Total liabilities 2,136,907
--------------
Net assets applicable to outstanding capital stock $6,352,010,372
==============
Represented by
Capital stock -- $.01 par value (Note 1) $ 63,520,772
Additional paid-in capital 6,288,487,000
Excess of distributions over net investment income (1)
Accumulated net realized gain (loss) 2,601
--------------
Total -- representing net assets applicable to outstanding capital stock $6,352,010,372
==============
Net assets applicable to outstanding shares:
Class A $5,766,208,544
Class B $ 379,626,926
Class C $ 3,559,144
Class Y $ 202,615,758
Net asset value per share of outstanding capital stock:
Class A shares 5,766,024,170 $ 1.00
Class B shares 379,788,520 $ 1.00
Class C shares 3,559,274 $ 1.00
Class Y shares 202,705,228 $ 1.00
----------- --------------
</TABLE>
See accompanying notes to financial statements.
--------------------------------------------------------------------------------
13 -- AXP CASH MANAGEMENT FUND -- 2002 ANNUAL REPORT
<PAGE>
<TABLE>
<CAPTION>
Statement of operations
AXP Cash Management Fund
Year ended July 31, 2002
<S> <C>
Investment income
Income:
Interest $162,785,643
------------
Expenses (Note 2):
Investment management services fee 19,698,010
Distribution fee
Class B 2,374,649
Class C 16,705
Transfer agency fee 13,071,478
Incremental transfer agency fee
Class A 1,063,498
Class B 59,708
Class C 402
Administrative services fees and expenses 1,584,135
Compensation of board members 45,931
Custodian fees 419,906
Printing and postage 1,996,570
Registration fees 841,839
Audit fees 36,250
Other 25,247
------
Total expenses 41,234,328
Earnings credits on cash balances (Note 2) (453,577)
--------
Total net expenses 40,780,751
----------
Investment income (loss) -- net 122,004,892
-----------
Realized and unrealized gain (loss) -- net
Net realized gain (loss) on security transactions (Note 3) 37,386
------
Net increase (decrease) in net assets resulting from operations $122,042,278
------------
</TABLE>
See accompanying notes to financial statements.
--------------------------------------------------------------------------------
14 -- AXP CASH MANAGEMENT FUND -- 2002 ANNUAL REPORT
<PAGE>
<TABLE>
<CAPTION>
Statements of changes in net assets
AXP Cash Management Fund
Year ended July 31, 2002 2001
Operations and distributions
<S> <C> <C>
Investment income (loss) -- net $ 122,004,892 $ 328,942,921
Net realized gain (loss) on investments 37,386 6,061
------ -----
Net increase (decrease) in net assets resulting from operations 122,042,278 328,948,982
----------- -----------
Distributions to shareholders from:
Net investment income
Class A (114,798,111) (309,127,272)
Class B (3,590,767) (11,336,961)
Class C (22,053) (16,835)
Class Y (3,594,108) (8,461,719)
---------- ----------
Total distributions (122,005,039) (328,942,787)
------------ ------------
Capital share transactions at constant $1 net asset value
Proceeds from sales
Class A shares 15,251,379,851 16,621,476,728
Class B shares 557,524,233 404,002,096
Class C shares 12,962,225 1,970,087
Class Y shares 212,427,535 324,334,535
Reinvestment of distributions at net asset value
Class A shares 115,021,206 309,605,354
Class B shares 3,560,788 11,198,696
Class C shares 20,690 16,103
Class Y shares 3,612,868 8,512,225
Payments for redemptions
Class A shares (15,748,777,409) (16,220,392,217)
Class B shares (Note 2) (454,014,609) (375,077,786)
Class C shares (Note 2) (10,288,817) (1,123,023)
Class Y shares (187,522,143) (300,272,985)
------------ ------------
Increase (decrease) in net assets from capital share transactions (244,093,582) 784,249,813
------------ -----------
Total increase (decrease) in net assets (244,056,343) 784,256,008
Net assets at beginning of year 6,596,066,715 5,811,810,707
------------- -------------
Net assets at end of year $ 6,352,010,372 $ 6,596,066,715
================ ================
Undistributed (excess of distributions over)
net investment income $ (1) $ 146
---------------- ----------------
</TABLE>
See accompanying notes to financial statements.
--------------------------------------------------------------------------------
15 -- AXP CASH MANAGEMENT FUND -- 2002 ANNUAL REPORT
<PAGE>
Notes to Financial Statements
AXP Cash Management Fund
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Fund is a series of AXP Money Market Series, Inc. and is registered under
the Investment Company Act of 1940 (as amended) as a diversified, open-end
management investment company. The Fund invests primarily in money market
instruments. AXP Money Market Series, Inc. has 10 billion authorized shares of
capital stock that can be allocated among the separate series as designated by
the board.
The Fund offers Class A, Class B, Class C and Class Y shares.
o Class A shares have no sales charge.
o Class B shares may be subject to a contingent deferred sales charge (CDSC)
and automatically convert to Class A shares during the ninth calendar year
of ownership.
o Class C shares may be subject to a CDSC.
o Class Y shares have no sales charge and are offered only to qualifying
institutional investors.
All classes of shares have identical voting, dividend and liquidation rights.
The distribution fee and incremental transfer agency fee (class specific
expenses) differ among classes. Income, expenses (other than class specific
expenses) and realized and unrealized gains or losses on investments are
allocated to each class of shares based upon its relative net assets.
The Fund's significant accounting policies are summarized below:
Use of estimates
Preparing financial statements that conform to accounting principles generally
accepted in the United States of America requires management to make estimates
(e.g., on assets, liabilities and contingent assets and liabilities) that could
differ from actual results.
Valuation of securities
Pursuant to Rule 2a-7 of the 1940 Act, all securities are valued daily at
amortized cost, which approximates market value, in order to maintain a constant
net asset value of $1 per share.
Federal taxes
The Fund's policy is to comply with all sections of the Internal Revenue Code
that apply to regulated investment companies and to distribute substantially all
of its taxable income to shareholders. No provision for income or excise taxes
is thus required.
Net investment income (loss) and net realized gains (losses) may differ for
financial statement and tax purposes. The character of distributions made during
the year from net investment income or net realized gains may differ from their
ultimate characterization for federal income tax purposes. Also, due to the
timing of dividend distributions, the fiscal year in which amounts are
distributed may differ from the year that the income or realized gains (losses)
were recorded by the Fund.
--------------------------------------------------------------------------------
16 -- AXP CASH MANAGEMENT FUND -- 2002 ANNUAL REPORT
<PAGE>
The tax character of distributions paid for the years indicated is as follows:
Year ended July 31 2002 2001
Class A
Distributions paid from:
Ordinary income $114,798,111 $309,127,272
Long-term capital gain -- --
Class B
Distributions paid from:
Ordinary income 3,590,767 11,336,961
Long-term capital gain -- --
Class C
Distributions paid from:
Ordinary income 22,053 16,835
Long-term capital gain -- --
Class Y
Distributions paid from:
Ordinary income 3,594,108 8,461,719
Long-term capital gain -- --
As of July 31, 2002, the components of distributable earnings on a tax basis are
as follows:
Undistributed ordinary income $1,257,710
Accumulated gain (loss) $ --
Unrealized appreciation (depreciation) $ --
Dividends to shareholders
Dividends from net investment income, declared daily and payable monthly, are
reinvested in additional shares of the Fund at net asset value or payable in
cash.
Other
Security transactions are accounted for on the date securities are purchased or
sold. Interest income, including amortization of premium and discount, is
accrued daily.
2. EXPENSES AND SALES CHARGES
The Fund has agreements with American Express Financial Corporation (AEFC) to
manage its portfolio and provide administrative services. Under an Investment
Management Services Agreement, AEFC determines which securities will be
purchased, held or sold. The management fee is a percentage of the Fund's
average daily net assets in reducing percentages from 0.36% to 0.25% annually.
Under an Administrative Services Agreement, the Fund pays AEFC a fee for
administration and accounting services at a percentage of the Fund's average
daily net assets in reducing percentages from 0.03% to 0.02% annually. A minor
portion of additional administrative service expenses paid by the Fund are
consultants' fees and fund office expenses. Under this agreement, the Fund also
pays taxes, audit and certain legal fees, registration fees for shares,
compensation of board members, corporate filing fees and any other expenses
properly payable by the Fund and approved by the board.
--------------------------------------------------------------------------------
17 -- AXP CASH MANAGEMENT FUND -- 2002 ANNUAL REPORT
<PAGE>
Under a separate Transfer Agency Agreement, American Express Client Service
Corporation (AECSC) maintains shareholder accounts and records. The incremental
transfer agency fee is the amount charged to the specific classes for the
additional expense above the fee for Class Y. The Fund pays AECSC an annual fee
per shareholder account for this service as follows:
o Class A $24.00
o Class B $25.00
o Class C $24.50
o Class Y $22.00
The Fund has agreements with American Express Financial Advisors Inc. (the
Distributor) for distribution and shareholder services. Under a Plan and
Agreement of Distribution, the Fund pays a distribution fee at an annual rate of
0.75% of the Fund's average daily net assets attributable to Class B and Class C
shares.
Sales charges received by the Distributor for distributing Fund shares were
$2,311,910 for Class B and $10,253 for Class C for the year ended July 31, 2002.
During the year ended July 31, 2002, the Fund's custodian and transfer agency
fees were reduced by $453,577 as a result of earnings credits from overnight
cash balances.
3. SECURITIES TRANSACTIONS
Cost of purchases and proceeds from sales of securities aggregated
$32,191,725,115 and $32,440,009,475, respectively, for the year ended July 31,
2002. Realized gains and losses are determined on an identified cost basis.
4. BANK BORROWINGS
The Fund has a revolving credit agreement with U.S. Bank, N.A., whereby the Fund
is permitted to have bank borrowings for temporary or emergency purposes to fund
shareholder redemptions. The Fund must have asset coverage for borrowings not to
exceed the aggregate of 333% of advances equal to or less than five business
days plus 367% of advances over five business days. The agreement, which enables
the Fund to participate with other American Express mutual funds, permits
borrowings up to $200 million, collectively. Interest is charged to each Fund
based on its borrowings at a rate equal to the Federal Funds Rate plus 0.30% or
the Eurodollar Rate (Reserve Adjusted) plus 0.20%. Borrowings are payable up to
90 days after such loan is executed. The Fund also pays a commitment fee equal
to its pro rata share of the amount of the credit facility at a rate of 0.05%
per annum. The Fund had no borrowings outstanding during the year ended July 31,
2002.
--------------------------------------------------------------------------------
18 -- AXP CASH MANAGEMENT FUND -- 2002 ANNUAL REPORT
<PAGE>
5. FINANCIAL HIGHLIGHTS
The tables below show certain important financial information for evaluating the
Fund's results.
Class A
Per share income and capital changes(a)
<TABLE>
<CAPTION>
Fiscal period ended July 31, 2002 2001 2000 1999 1998
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------ ------ ------- ------ ------
Income from investment operations:
Net investment income (loss) .02 .05 .05 .05 .05
--- --- --- --- ---
Less distributions:
Dividends from net investment income (.02) (.05) (.05) (.05) (.05)
---- ---- ---- ---- ----
Net asset value, end of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------ ------ ------- ------ ------
Ratios/supplemental data
Net assets, end of period (in millions) $5,766 $6,149 $ 5,438 $5,032 $3,926
Ratio of expenses to average daily net assets(c) .59% .59% .58% .57% .56%
Ratio of net investment income (loss) to average daily net 1.89% 5.18% 5.37% 4.65% 5.15%
Total return(e) 1.93% 5.35% 5.55% 4.71% 5.34%
Class B
Per share income and capital changes(a)
Fiscal period ended July 31, 2002 2001 2000 1999 1998
Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------ ------ ------- ------ ------
Income from investment operations:
Net investment income (loss) .01 .05 .05 .04 .04
--- --- --- --- ---
Less distributions:
Dividends from net investment income (.01) (.05) (.05) (.04) (.04)
---- ---- ---- ---- ----
Net asset value, end of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------ ------ ------- ------ ------
Ratios/supplemental data
Net assets, end of period (in millions) $ 380 $ 273 $ 232 $ 192 $ 98
Ratio of expenses to average daily net assets(c) 1.34% 1.34% 1.33% 1.32% 1.32%
Ratio of net investment income (loss) to average daily net assets 1.13% 4.37% 4.64% 3.88% 4.38%
Total return(e) 1.13% 4.57% 4.76% 3.94% 4.53%
</TABLE>
See accompanying notes to financial highlights.
--------------------------------------------------------------------------------
19 -- AXP CASH MANAGEMENT FUND -- 2002 ANNUAL REPORT
<PAGE>
<TABLE>
<CAPTION>
Class C
Per share income and capital changes(a)
Fiscal period ended July 31, 2002 2001 2000(b)
<S> <C> <C> <C>
Net asset value, beginning of period $1.00 $1.00 $1.00
----- ----- -----
Income from investment operations:
Net investment income (loss) .01 .05 --
--- --- ---
Less distributions:
Dividends from net investment income (.01) (.05) --
---- ---- ---
Net asset value, end of period $1.00 $1.00 $1.00
----- ----- -----
Ratios/supplemental data
Net assets, end of period (in millions) $4 $1 $--
Ratio of expenses to average daily net assets(c) 1.34% 1.34% 1.33%(d)
Ratio of net investment income (loss) to average daily net assets .99% 3.88% 6.10%(d)
Total return(e) 1.14% 4.68% .63%
</TABLE>
<TABLE>
<CAPTION>
Class Y
Per share income and capital changes(a)
Fiscal period ended July 31, 2002 2001 2000 1999 1998
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $1.00 $1.00 $1.00 $1.00 $1.00
----- ----- ----- ----- -----
Income from investment operations:
Net investment income (loss) .02 .05 .05 .05 .05
--- --- --- --- ---
Less distributions:
Dividends from net investment income (.02) (.05) (.05) (.05) (.05)
---- ---- ---- ---- ----
Net asset value, end of period $1.00 $1.00 $1.00 $1.00 $1.00
----- ----- ----- ----- -----
Ratios/supplemental data
Net assets, end of period (in millions) $203 $174 $142 $124 $72
Ratio of expenses to average daily net assets(c) .57% .57% .57% .56% .56%
Ratio of net investment income (loss) to average daily net 1.86% 5.18% 5.42% 4.64% 5.16%
Total return(e) 1.95% 5.37% 5.56% 4.72% 5.33%
</TABLE>
Notes to financial highlights
(a) For a share outstanding throughout the period. Rounded to the nearest cent.
(b) Inception date was June 26, 2000.
(c) Expense ratio is based on total expenses of the Fund before reduction of
earnings credits on cash balances.
(d) Adjusted to an annual basis.
(e) Total return does not reflect payment of a sales charge.
--------------------------------------------------------------------------------
20 -- AXP CASH MANAGEMENT FUND -- 2002 ANNUAL REPORT
<PAGE>
Independent Auditors' Report
THE BOARD AND SHAREHOLDERS
AXP MONEY MARKET SERIES, INC.
We have audited the accompanying statement of assets and liabilities, including
the schedule of investments in securities, of AXP Cash Management Fund (a series
of AXP Money Market Series, Inc.) as of July 31, 2002, the related statement of
operations for the year then ended, the statements of changes in net assets for
each of the years in the two-year period ended July 31, 2002, and the financial
highlights for each of the years in the five-year period ended July 31, 2002.
These financial statements and the financial highlights are the responsibility
of fund management. Our responsibility is to express an opinion on these
financial statements and the financial highlights based on our audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements and the financial highlights are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. Our procedures included confirmation of
securities owned as of July 31, 2002, by correspondence with the custodian or by
other appropriate auditing procedures. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of AXP Cash Management Fund as of
July 31, 2002, and the results of its operations, changes in its net assets, and
the financial highlights for each of the periods stated in the first paragraph
above, in conformity with accounting principles generally accepted in the United
States of America.
KPMG LLP
Minneapolis, Minnesota
September 6, 2002
--------------------------------------------------------------------------------
21 -- AXP CASH MANAGEMENT FUND -- 2002 ANNUAL REPORT
<PAGE>
Federal Income Tax Information
(UNAUDITED)
The Fund is required by the Internal Revenue Code of 1986 to tell its
shareholders about the tax treatment of the dividends it pays during its fiscal
year. The dividends listed below are reported to you on Form 1099-DIV, Dividends
and Distributions. Shareholders should consult a tax advisor on how to report
distributions for state and local tax purposes.
AXP Cash Management Fund
Fiscal year ended July 31, 2002
Class A
Income distributions taxable as dividend income, none qualifying for deduction
by corporations.
Payable date Per share
Aug. 27, 2001 $0.00267
Sept. 26, 2001 0.00273
Oct. 26, 2001 0.00226
Nov. 26, 2001 0.00180
Dec. 20, 2001 0.00146
Jan. 25, 2002 0.00161
Feb. 26, 2002 0.00128
March 26, 2002 0.00100
April 26, 2002 0.00110
May 24, 2002 0.00099
June 26, 2002 0.00115
July 26, 2002 0.00107
Total distributions $0.01912
Class B
Income distributions taxable as dividend income, none qualifying for deduction
by corporations.
Payable date Per share
Aug. 27, 2001 $0.00206
Sept. 26, 2001 0.00209
Oct. 26, 2001 0.00164
Nov. 26, 2001 0.00120
Dec. 20, 2001 0.00092
Jan. 25, 2002 0.00087
Feb. 26, 2002 0.00062
March 26, 2002 0.00042
April 26, 2002 0.00046
May 24, 2002 0.00041
June 26, 2002 0.00048
July 26, 2002 0.00045
Total distributions $0.01162
--------------------------------------------------------------------------------
22 -- AXP CASH MANAGEMENT FUND -- 2002 ANNUAL REPORT
<PAGE>
Class C
Income distributions taxable as dividend income, none qualifying for deduction
by corporations.
Payable date Per share
Aug. 27, 2001 $0.00207
Sept. 26, 2001 0.00210
Oct. 26, 2001 0.00160
Nov. 26, 2001 0.00121
Dec. 20, 2001 0.00096
Jan. 25, 2002 0.00082
Feb. 26, 2002 0.00063
March 26, 2002 0.00043
April 26, 2002 0.00046
May 24, 2002 0.00042
June 26, 2002 0.00047
July 26, 2002 0.00045
Total distributions $0.01162
Class Y
Income distributions taxable as dividend income, none qualifying for deduction
by corporations.
Payable date Per share
Aug. 27, 2001 $0.00269
Sept. 26, 2001 0.00274
Oct. 26, 2001 0.00227
Nov. 26, 2001 0.00181
Dec. 20, 2001 0.00147
Jan. 25, 2002 0.00163
Feb. 26, 2002 0.00129
March 26, 2002 0.00101
April 26, 2002 0.00112
May 24, 2002 0.00100
June 26, 2002 0.00117
July 26, 2002 0.00108
Total distributions $0.01928
--------------------------------------------------------------------------------
23 -- AXP CASH MANAGEMENT FUND -- 2002 ANNUAL REPORT
<PAGE>
Board Members and Officers
Shareholders elect a board that oversees the Fund's operations. The board
appoints officers who are responsible for day-to-day business decisions based on
policies set by the board.
The following is a list of the Fund's board members. Each member oversees 15
Master Trust portfolios and 78 American Express mutual funds. Board members
serve until the next regular shareholders' meeting or until he or she reaches
the mandatory retirement age established by the board.
<TABLE>
<CAPTION>
Independent Board Members
---------------------------- ------------------------ ------------------- ------------------
Name, Position held with Principal Other
address, Registrant and length occupations directorships
age of service during past five
years
---------------------------- ------------------------ ------------------- ------------------
---------------------------- ------------------------ ------------------- ------------------
<S> <C> <C> <C>
H. Brewster Atwater, Jr. Board member Retired chair and
4900 IDS Tower since 1996 chief executive
Minneapolis, MN 55402 officer, General
Born in 1931 Mills, Inc.
(consumer foods)
---------------------------- ------------------------ ------------------- ------------------
---------------------------- ------------------------ ------------------- ------------------
Arne H. Carlson Chair of the Board Chair, Board
901 S. Marquette Ave. since 1999 Services
Minneapolis, MN 55402 Corporation
Born in 1934 (provides
administrative
services to
boards), former
Governor of
Minnesota
---------------------------- ------------------------ ------------------- ------------------
---------------------------- ------------------------ ------------------- ------------------
Lynne V. Cheney Board member since 1994 Distinguished The Reader's
American Enterprise Fellow, AEI Digest
Institute Association Inc.
for Public Policy Research
(AEI)
1150 17th St., N.W.
Washington, D.C. 20036
Born in 1941
---------------------------- ------------------------ ------------------- ------------------
---------------------------- ------------------------ ------------------- ------------------
Livio D. DeSimone Board member Retired chair of Cargill,
30 Seventh Street East since 2001 the board and Incorporated
Suite 3050 chief executive (commodity
St. Paul, MN 55101-4901 officer, merchants and
Born in 1936 Minnesota Mining processors),
and Manufacturing Target
(3M) Corporation
(department
stores), General
Mills, Inc.
(consumer
foods), Vulcan
Materials
Company
(construction
materials/chemicals),
Milliken &
Company
(textiles and
chemicals) and
Nexia
Biotechnologies,
Inc.
---------------------------- ------------------------ ------------------- ------------------
---------------------------- ------------------------ ------------------- ------------------
Ira D. Hall Board member Private investor; Imagistics
Texaco, Inc. since 2001 formerly with International,
2000 Westchester Avenue Texaco Inc., Inc. (office
White Plains, NY 10650 treasurer, equipment),
Born in 1944 1999-2001 and Reynolds &
general manager, Reynolds Company
alliance (information
management services), TECO
operations, Energy, Inc.
1998-1999. Prior (energy holding
to that, company), The
director, Williams
International Companies, Inc.
Operations IBM (energy
Corp. distribution
company)
---------------------------- ------------------------ ------------------- ------------------
---------------------------- ------------------------ ------------------- ------------------
Heinz F. Hutter Board member Retired president
P.O. Box 2187 since 1994 and chief
Minneapolis, MN 55402 operating
Born in 1929 officer, Cargill,
Incorporated
(commodity
merchants and
processors)
---------------------------- ------------------------ ------------------- ------------------
---------------------------- ------------------------ ------------------- ------------------
Anne P. Jones Board member Attorney and Motorola, Inc.
5716 Bent Branch Rd. since 1985 consultant (electronics)
Bethesda, MD 20816
Born in 1935
---------------------------- ------------------------ ------------------- ------------------
</TABLE>
--------------------------------------------------------------------------------
24 -- AXP CASH MANAGEMENT FUND -- 2002 ANNUAL REPORT
<PAGE>
<TABLE>
<CAPTION>
Independent Board Members (continued)
---------------------------- ------------------------ ------------------- ------------------
Name, Position held with Principal Other
address, Registrant and length occupations directorships
age of service during past five
years
---------------------------- ------------------------ ------------------- ------------------
---------------------------- ------------------------ ------------------- ------------------
<S> <C> <C> <C>
Stephen R. Lewis, Jr. Board member Retired president
901 S. Marquette Ave. since 2002 and professor of
Minneapolis, MN 55402 economics,
Born in 1939 Carleton College
---------------------------- ------------------------ ------------------- ------------------
---------------------------- ------------------------ ------------------- ------------------
William R. Pearce Board member RII Weyerhaeuser
2050 One Financial Plaza since 1980 World Timberfund,
Minneapolis, MN 55402 L.P. (develops
Born in 1927 timber resources)
- management
committee; former
chair, American
Express Funds
---------------------------- ------------------------ ------------------- ------------------
---------------------------- ------------------------ ------------------- ------------------
Alan G. Quasha Board member President, Compagnie
720 Fifth Avenue since 2002 Quadrant Financiere
New York, NY 10019 Management, Inc. Richemont AG
Born in 1949 (management of (luxury goods)
private equities)
---------------------------- ------------------------ ------------------- ------------------
---------------------------- ------------------------ ------------------- ------------------
Alan K. Simpson Board member Former three-term Biogen, Inc.
1201 Sunshine Ave. since 1997 United States (bio-pharmaceuticals)
Cody, WY 82414 Senator for
Born in 1931 Wyoming
---------------------------- ------------------------ ------------------- ------------------
---------------------------- ------------------------ ------------------- ------------------
C. Angus Wurtele Board member Retired chair of Bemis
4900 IDS Tower since 1994 the board and Corporation
Minneapolis, MN 55402 chief executive (packaging)
Born in 1934 officer,
The Valspar
Corporation
---------------------------- ------------------------ ------------------- ------------------
</TABLE>
<TABLE>
<CAPTION>
Board Members Affiliated with American Express Financial Corporation (AEFC)
---------------------------- ------------------------ ------------------- ------------------
Name, Position held with Principal Other
address, Registrant and length occupations directorships
age of service during past five
years
---------------------------- ------------------------ ------------------- ------------------
---------------------------- ------------------------ ------------------- ------------------
<S> <C> <C> <C>
David R. Hubers Board member Retired chief Chronimed Inc.
50643 AXP Financial Center since 1993 executive officer (specialty
Minneapolis, MN 55474 and director of pharmaceutical
Born in 1943 AEFC distribution),
RTW Inc.
(manages workers
compensation
programs),
Lawson Software,
Inc. (technology
based business
applications)
---------------------------- ------------------------ ------------------- ------------------
---------------------------- ------------------------ ------------------- ------------------
John R. Thomas Board member Senior vice
50652 AXP Financial Center since 1987, president -
Minneapolis, MN 55474 president information and
Born in 1937 since 1997 technology of AEFC
---------------------------- ------------------------ ------------------- ------------------
---------------------------- ------------------------ ------------------- ------------------
William F. Truscott Board member Senior vice
53600 AXP Financial Center since 2001, president - chief
Minneapolis, MN 55474 vice president investment
Born in 1960 since 2002 officer of AEFC;
former chief
investment
officer and
managing
director, Zurich
Scudder
Investments
---------------------------- ------------------------ ------------------- ------------------
</TABLE>
--------------------------------------------------------------------------------
25 -- AXP CASH MANAGEMENT FUND -- 2002 ANNUAL REPORT
<PAGE>
The board has appointed officers who are responsible for day-to-day business
decisions based on policies it has established. The officers serve at the
pleasure of the board. In addition to Mr. Thomas, who is president, and Mr.
Truscott, who is vice president, the Fund's other officers are:
<TABLE>
<CAPTION>
Other Officers
---------------------------- ------------------------ ------------------- ------------------
Name, address, age Position held with Principal Other
Registrant and length occupations directorships
of service during past five
years
---------------------------- ------------------------ ------------------- ------------------
---------------------------- ------------------------ ------------------- ------------------
<S> <C> <C> <C>
Jeffrey P. Fox Treasurer Vice president -
50005 AXP Financial Center since 2002 investment
Minneapolis, MN 55474 accounting, AEFC,
Born in 1955 since 2002; vice
president -
finance,
American Express
Company, 2000-2002;
vice president -
corporate
controller,
AEFC, 1996-2000
---------------------------- ------------------------ ------------------- ------------------
---------------------------- ------------------------ ------------------- ------------------
Leslie L. Ogg Vice president, President of
901 S. Marquette Ave. general counsel Board Services
Minneapolis, MN 55402 and secretary Corporation
Born in 1938 since 1978
---------------------------- ------------------------ ------------------- ------------------
---------------------------- ------------------------ ------------------- ------------------
Stephen W. Roszell Vice president Senior vice
50239 AXP Financial Center since 2002 president -
Minneapolis, MN 55474 institutional
Born in 1949 group of AEFC
---------------------------- ------------------------ ------------------- ------------------
</TABLE>
The SAI has additional information about the Fund's directors and is available,
without charge, upon request by calling (800) 862-7919.
--------------------------------------------------------------------------------
26 -- AXP CASH MANAGEMENT FUND -- 2002 ANNUAL REPORT
<PAGE>
American Express(R) Funds
Growth Funds
AXP(R) Emerging Markets Fund
AXP Equity Select Fund
AXP Focused Growth Fund
AXP Global Growth Fund
AXP Growth Fund
AXP Growth Dimensions Fund
AXP New Dimensions Fund(R)
AXP Partners International Aggressive Growth Fund
AXP Partners Small Cap Growth Fund
AXP Strategy Aggressive Fund
Blend Funds
AXP Blue Chip Advantage Fund
AXP Discovery Fund*
AXP European Equity Fund
AXP Global Balanced Fund
AXP International Fund
AXP International Equity Index Fund
AXP Large Cap Equity Fund
AXP Managed Allocation Fund
AXP Mid Cap Index Fund
AXP Nasdaq 100 Index(R) Fund
AXP Partners Small Cap Core Fund
AXP Research Opportunities Fund
AXP S&P 500 Index Fund
AXP Small Cap Advantage Fund
AXP Small Company Index Fund
AXP Stock Fund
AXP Total Stock Market Index Fund
Value Funds
AXP Diversified Equity Income Fund
AXP Equity Value Fund
AXP Large Cap Value Fund
AXP Mid Cap Value Fund
AXP Mutual
AXP Partners Fundamental Value Fund
AXP Partners International Select Value Fund
AXP Partners Select Value Fund
AXP Partners Small Cap Value Fund
AXP Partners Value Fund
AXP Progressive Fund*
Income/Tax-Exempt Income Funds
AXP Bond Fund
AXP Cash Management Fund**
AXP Extra Income Fund
AXP Federal Income Fund
AXP Global Bond Fund
AXP High Yield Tax-Exempt Fund
AXP Insured Tax-Exempt Fund
AXP Intermediate Tax-Exempt Fund
AXP Selective Fund
AXP State Tax-Exempt Funds
AXP Tax-Exempt Bond Fund
AXP Tax-Free Money Fund**
AXP U.S. Government Mortgage Fund
Sector Funds
AXP Global Technology Fund
AXP Precious Metals Fund
AXP Utilities Fund
These funds are also listed in the categories above.
AXP(R) Partners Funds
AXP Partners Fundamental Value Fund
AXP Partners International Aggressive Growth Fund
AXP Partners International Select Value Fund
AXP Partners Select Value Fund
AXP Partners Small Cap Core Fund
AXP Partners Small Cap Growth Fund
AXP Partners Small Cap Value Fund
AXP Partners Value Fund
International Funds
AXP Emerging Markets Fund
AXP European Equity Fund
AXP Global Balanced Fund
AXP Global Bond Fund
AXP Global Growth Fund
AXP International Fund
AXP Partners International Aggressive Growth Fund
AXP Partners International Select Value Fund
* Closed to new investors.
** An investment in the Fund is not insured or guaranteed by the Federal
Deposit Insurance Corporation or any other government agency. Although the
Fund seeks to preserve the value of your investment at $1.00 per share, it
is possible to lose money by investing in the Fund.
For more complete information about our funds, including fees and expenses,
please call (800) 862-7919 for prospectuses. Read them carefully before you
invest.
(9/02)
<PAGE>
AXP Cash Management Fund
70100 AXP Financial Center
Minneapolis, MN 55474
americanexpress.com
American
Express(R)
Funds
AMERICAN
EXPRESS(R)
This report must be accompanied or preceded by the Fund's current prospectus.
Distributed by American Express Financial Advisors Inc. Member NASD. American
Express
Company is separate from American Express Financial Advisors Inc. and is not a
broker-dealer.
S-6320 Y (9/02)
</TEXT>
</DOCUMENT>