-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, F4ESmNB/ynlMzJ6SGth/S2sfNVqx1CB0uegu3TVKADucDHFdH6+JYvgHeOku0YQf 1J/tGeRXQm6tht/AofWWXQ== 0000749748-01-500005.txt : 20010606 0000749748-01-500005.hdr.sgml : 20010606 ACCESSION NUMBER: 0000749748-01-500005 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20010331 FILED AS OF DATE: 20010605 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CASH ASSETS TRUST CENTRAL INDEX KEY: 0000749748 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] IRS NUMBER: 136844974 STATE OF INCORPORATION: MA FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: N-30D SEC ACT: SEC FILE NUMBER: 811-04066 FILM NUMBER: 1654159 BUSINESS ADDRESS: STREET 1: 380 MADISON AVE STREET 2: SUITE 2300 CITY: NEW YORK STATE: NY ZIP: 10017 BUSINESS PHONE: 2126976666 MAIL ADDRESS: STREET 1: 380 MADISON AVENUE STREET 2: SUITE 2300 CITY: NEW YORK STATE: NY ZIP: 10017 N-30D 1 pccatsannual.txt CATS 3/31/01 ANNUAL REPORT INVESTMENT ADVISER Asset Management Group of Bank of Hawaii Financial Plaza of the Pacific * P.O. Box 3170 Honolulu, Hawaii 96802 ADMINISTRATOR Aquila Management Corporation 380 Madison Avenue, Suite 2300 * New York, New York 10017 BOARD OF TRUSTEES Lacy B. Herrmann, Chairman Vernon R. Alden Arthur K. Carlson William M. Cole Thomas W. Courtney Richard W. Gushman, II Stanley W. Hong Theodore T. Mason Russell K. Okata Douglas Philpotts Oswald K. Stender OFFICERS Diana P. Herrmann, President Charles E. Childs, III, Senior Vice President Sherri Foster, Vice President Rose F. Marotta, Chief Financial Officer Joseph P. DiMaggio, Treasurer Edward M.W. Hines, Secretary DISTRIBUTOR Aquila Distributors, Inc. 380 Madison Avenue, Suite 2300 * New York, New York 10017 TRANSFER AND SHAREHOLDER SERVICING AGENT PFPC Inc. 400 Bellevue Parkway * Wilmington, Delaware 19809 CUSTODIAN Bank One Trust Company, N.A. 100 East Broad Street * Columbus, Ohio 43271 INDEPENDENT AUDITORS KPMG LLP 757 Third Avenue * New York, New York 10017 Further information is contained in the Prospectus which must precede or accompany this report. ANNUAL REPORT MARCH 31, 2001 THE PACIFIC CAPITAL FUNDS OF CASH ASSETS TRUST PACIFIC CAPITAL CASH ASSETS TRUST PACIFIC CAPITAL TAX-FREE CASH ASSETS TRUST PACIFIC CAPITAL U.S. GOVERNMENT SECURITIES CASH ASSETS TRUST [Logo of The Pacific Capital Funds of Cash Assets Trust: a lion standing on a twisted rope] A CASH MANAGEMENT INVESTMENT [Logo of The Pacific Capital Funds of Cash Assets Trust: a lion standing on a twisted rope] THE PACIFIC CAPITAL FUNDS OF CASH ASSETS TRUST ANNUAL REPORT May 18, 2001 Dear Investor: We are pleased to provide you with the Annual Report for The Pacific Capital Funds of Cash Assets Trust for the fiscal year ended March 31, 2001. The enclosed Annual Report includes the three series of Cash Assets Trust (the "Trust"): Pacific Capital Cash Assets Trust, Pacific Capital Tax-Free Cash Assets Trust and Pacific Capital U.S. Government Securities Cash Assets Trust and its two classes of shares: Original Shares and Service Shares. The economic climate and the Federal Reserve's monetary policy once again had an impact on the short-term debt markets during the Trust's current report period. The Trust's fiscal year began with exceptionally strong economic growth which fueled investor fears that inflation would rise. The Fed reacted in May, 2000 by raising the Federal Fund's rate - an overnight bank lending rate - to 6.50%. At the time, the Fed was concerned that with a strong economy and low unemployment, inflation would worsen as the increased stress on labor markets would potentially put additional upward pressure on wages and ultimately prices. The Fed's restrictive monetary policy finally took hold, slowing the nation's economy in the last quarter of 2000 and the first quarter of 2001 to 1.0% and 2.2%, respectively. During this period, job growth cooled off, unemployment claims jumped, consumer confidence fell and manufacturing activity plunged. Instead of rising level of inflation, the Fed became more concerned about a decline in corporate profits, continued weakening economic conditions both here and abroad and the possible effect of sustained stock market losses on people's behavior. Compared to a year ago, the Fed is now committed to averting a possible recession by aggressively lowering short-term interest rates. The Federal Fund's rate now stands at 4.00%, a 250 basis point decline in one year. The Fed has indicated that further rate cuts may still be necessary. Even with the possibility of further short-term interest rate cuts in the offing, each of the Trust's investment portfolios is well positioned to continually offer competitive rates of return for your cash reserves. Through alertness to market opportunities, each of the Trust's portfolios can produce a highly competitive return for its investors without compromising safety. As we have commented in previous reports to shareholders, it is the belief of the Trust's Board of Trustees, Investment Adviser and management that cash reserves of investors is one area of money management with which one specifically does not take any undue risks in order to earn extra yield. There are sufficient other investments available for investors to balance risk and return. Looking forward, we are optimistic that The Pacific Capital Funds of Cash Assets Trust will continue to provide investors attractive yields compared to alternative money market investments. All associated with The Pacific Capital Funds of Cash Assets Trust want to thank you for your continued support and confidence. Sincerely, Diana P. Herrmann Lacy B. Herrmann President Chairman, Board of Trustees PRIVACY NOTICE (UNAUDITED) OUR PRIVACY POLICY. In providing services to you as an individual who owns or is considering investing in shares of a fund of the AquilaSM Group of Funds, we collect certain nonpublic personal information about you. Our policy is to keep this information strictly safeguarded and confidential, and to use or disclose it only as necessary to provide services to you or as otherwise permitted by law. Our privacy policy applies equally to former shareholders and persons who inquire about a fund. INFORMATION WE COLLECT. "Nonpublic personal information" is personally identifiable financial information about you as an individual or your family. The kinds of nonpublic personal information we have about you may include the information you provide us on your share purchase application or in telephone calls or correspondence with us, and information about your fund transactions and holdings, how you voted your shares and the account where your shares are held. INFORMATION WE DISCLOSE. We disclose nonpublic personal information about you to companies that provide necessary services to your fund, such as the fund's transfer agent, distributor, investment adviser or sub-adviser and to our affiliates, as permitted or required by law, or as authorized by you. We also may disclose the information about you, as described above, to companies that perform marketing services for your fund or to other financial institutions with which we have joint marketing agreements. HOW WE SAFEGUARD YOUR INFORMATION. We restrict access to nonpublic personal information about you to only those persons who need it to provide services to you or who are permitted by law to receive it. We maintain physical, electronic and procedural safeguards to protect the confidentiality of all nonpublic personal information we have about you. If you have any questions regarding our Privacy Policy, please contact us at 1-800-437-1020. [Logo of KPMG LLP: four solid rectangles with the letters KPMG in front of them] INDEPENDENT AUDITORS' REPORT To the Board of Trustees and Shareholders of Cash Assets Trust: We have audited the accompanying statements of assets and liabilities of The Pacific Capital Funds of Cash Assets Trust (the "Trust") (comprised of Cash Fund, Tax-Free Fund and Government Fund), including the statements of investments, as of March 31, 2001, and the related statements of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended. These financia l statements and financial highlights are the responsibility of the Trust's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. We conducted our audits in accordance with 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 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 and financial highlights. Our procedures included confirmation of securities owned as of March 31, 2001, by correspondence with the custodian and brokers. 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 and financial highlights referred to above present fairly, in all material respects, the financial position of the Trust as of March 31, 2001, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America. KPMG LLP New York, New York April 30, 2001 PACIFIC CAPITAL CASH ASSETS TRUST STATEMENT OF INVESTMENTS MARCH 31, 2001
FACE AMOUNT U.S. GOVERNMENT AGENCY DISCOUNT NOTES (12.8%) VALUE - ------------ ------------------------------------------------------------------ ------------ $ 10,066,000 Federal Home Loan Bank, 5.13%, 4/02/01 ........................... $ 10,064,566 40,000,000 Federal Home Loan Bank, 4.91%, 4/18/01 ........................... 39,907,255 25,000,000 Federal Home Loan Bank, 4.62%, 6/15/01 ........................... 24,759,375 ------------ Total U.S. Government Agency Discount Notes .............. 74,731,196 ------------ COMMERCIAL PAPER (70.9%) ------------------------------------------------------------------ BANKING/CREDIT UNION (16.0%) ------------------------------------------------------------------ 20,000,000 Deutsche Bank AG, 4.77%, 5/23/01 ................................. 19,862,200 25,000,000 PEMEX - LOC - Barclays PLC, 4.67%, 6/26/01 ....................... 24,721,097 25,000,000 Societe Generale, 4.60%, 7/16/01 ................................. 24,661,389 25,000,000 Wells Fargo & Co., 4.72%, 6/15/01 ................................ 24,754,167 ------------ Total Banking/Credit Union ................................... 93,998,853 ------------ BROKERAGE (21.8%) ------------------------------------------------------------------ 25,000,000 Bear Stearns & Co., 4.84%, 6/08/01 ............................... 24,771,444 27,000,000 Goldman Sachs Group, Inc., 5.37%, 5/11/01 ........................ 26,838,900 20,000,000 Merrill Lynch & Co., Inc., 4.70%, 5/29/01 ........................ 19,848,556 28,000,000 Morgan Stanley Dean Witter & Co., 5.40%, 4/12/01 ................. 27,953,800 28,000,000 Salomon Smith Barney, Inc., 5.43%, 4/05/01 ....................... 27,983,107 ------------ Total Brokerage .............................................. 127,395,807 ------------ EDUCATION (12.2%) ------------------------------------------------------------------ 20,000,000 Harvard University, 5.25%, 7/16/01 ............................... 19,690,833 10,000,000 Stanford University, 5.33%, 4/02/01 .............................. 9,998,519 17,000,000 Stanford University, 5.00%, 4/23/01 .............................. 16,948,056 25,000,000 Yale University, 4.74%, 5/24/01 .................................. 24,825,542 ------------ Total Education .............................................. 71,462,950 ------------ FINANCE (17.5%) ------------------------------------------------------------------ 20,000,000 American Express Credit Corp., 4.63%, 6/20/01 .................... 19,794,222 29,000,000 American General Corp., 5.56%, 4/12/01 ........................... 28,950,732 29,000,000 General Electric Capital Corp., 5.53%, 5/07/01 ................... 28,839,630 25,000,000 National Rural Utilities Cooperative Finance Corp., 4.78%, 5/21/01 24,834,028 ------------ Total Finance ................................................ 102,418,612 ------------ OIL & GAS (3.4%) ------------------------------------------------------------------ 20,000,000 Texaco, Inc., 4.90%, 5/25/01 ..................................... 19,853,000 ------------ Total Commercial Paper ................................... 415,129,222 ------------ CORPORATE NOTES (2.5%) ------------------------------------------------------------------ $ 15,000,000 Peoples Benefit Life, Variable Rate Note, 5.55%, 4/01/01 (1) ..... $ 15,000,000 ------------ REPURCHASE AGREEMENTS (14.2%) ------------------------------------------------------------------ 83,000,000 SG Cowen, 5.22%, due 4/02/01 ..................................... 83,000,000 ------------ (Proceeds of $83,036,105 to be received at maturity) Collateral: $61,810,000 U.S. Treasury Bond 8.88% due 8/15/17 Collateral Market Value $84,660,000 Total Investments (amortized cost $587,860,418*).. 100.4% 587,860,418 Other assets less liabilities .................... (0.4) (2,496,041) ------ ------------ Net Assets ....................................... 100.0% $585,364,377 ====== ============
(*) Cost for Federal tax purposes is identical. (1) Illiquid security. The security is considered illiquid because it may not be sold, and may be redeemed only upon at least ninety days' notice to the issuer. As this security is a variable rate, note the rate shown represents the rate in effect at fiscal year-end and the maturity date reflects the next rate change date. AG - Aktiengesellschaft (West German Stock Co.) LOC - Letter of Credit PLC - Public Limited Company See accompanying notes to financial statements. PACIFIC CAPITAL TAX-FREE CASH ASSETS TRUST STATEMENT OF INVESTMENTS MARCH 31, 2001
RATING FACE MOODY'S/ AMOUNT BONDS AND NOTES (99.9%) S&P VALUE - ------------ ------------------------------------------------------------------------ --------- ------------- ALABAMA (0.8%) ------------------------------------------------------------------------ Montgomery, AL Baptist Medical Center Special Care Facilities Financing Authority, Revenue Bonds, Series A $ 1,250,000 5.75%, 1/01/22.......................................................... Aaa/AAA $ 1,272,810 ------------- ARIZONA (3.1%) ------------------------------------------------------------------------ Maricopa County, AZ Industrial Development Authority Multi Family Housing Revenue Bonds, (Grand Victoria Housing LLC Project), Series A 4,765,000 3.50%, 4/15/30, Weekly Reset*........................................... NR/AAA 4,765,000 ------------- Insurance: Federal National Mortgage Association Collateral FLORIDA (1.1%) ------------------------------------------------------------------------ Dade County, FL Public Services Tax Revenue Bonds 1,120,000 5.00%, 10/01/01......................................................... Aaa/AAA 1,128,778 Insurance: Financial Security Assurance Manatee County, FL Public Utility Improvement Revenue Bonds, Series 1991 A 500,000 6.75%, 10/01/13......................................................... Aaa/AAA 515,736 ------------- Insurance: Municipal Bond Insurance Association Total Florida................................................... 1,644,514 ------------- GEORGIA (0.6%) ------------------------------------------------------------------------ Atlanta, GA Water & Wastewater Revenue Bonds, Series A 1,000,000 4.50%, 11/01/01......................................................... Aaa/AAA 1,006,462 ------------- Insurance: Financial Guaranty Insurance Corporation HAWAII (38.6%) ------------------------------------------------------------------------ Hawaii County, HI General Obligation Bonds, Series B 1,085,000 4.25%, 5/15/01.......................................................... Aaa/AAA 1,085,052 Insurance: Financial Security Assurance Hawaii State, Airports System Revenue Bonds, Second Series 2,175,000 6.75%, 7/01/21.......................................................... Aaa/AAA 2,230,312 Insurance: Municipal Bond Insurance Association Hawaii State, Airports System Revenue Bonds, Third Series $ 2,000,000 5.38%, 7/01/01.......................................................... Aaa/AAA $ 2,004,592 Insurance: American Municipal Bond Assurance Corporation Hawaii State, Department of Budget & Finance Special Purpose Revenue Bonds (Pali Momi Medical Center Project) 1,000,000 7.65%, 7/01/19.......................................................... AAA/AAA 1,030,108 Hawaii State, Department of Budget & Finance Special Purpose Revenue Bonds (Queens Health System), Series A 17,960,000 3.55%, 7/01/26, Weekly Reset*........................................... VMIG1/A1 17,960,000 Hawaii State, General Obligation Bonds, Series BV 1,300,000 5.85%, 11/01/01......................................................... Aa3/A+ 1,312,150 Hawaii State, General Obligation Bonds, Series CE 750,000 4.50%, 6/01/01.......................................................... Aa3/A+ 750,189 Hawaii State, General Obligation Bonds, Series CI 2,790,000 4.10%, 11/01/01......................................................... Aa3/A+ 2,781,046 Hawaii State, General Obligation Bonds, Series CK 250,000 6.00%, 9/01/01.......................................................... Aa3/A+ 252,877 Hawaii State Highway Revenue Bonds 1,060,000 4.40%, 7/01/01.......................................................... Aa3/AA 1,060,004 Hawaii State Highway Revenue Bonds 1,000,000 5.00%, 7/01/01.......................................................... Aaa/AAA 1,003,896 Insurance: Financial Guaranty Insurance Corporation Hawaii State Housing Finance & Development Corp. Revenue Bonds (Rental Housing System), Series 89 A 2,700,000 3.40%, 7/01/24, Weekly Reset*........................................... Aa3/NR 2,700,000 Letter of Credit: Banque Nationale Paris Hawaii State Housing Finance & Development Corp. Revenue Bonds (Affordable Rental Housing Program), Series A 7,450,000 3.75%, 7/01/27, Weekly Reset*........................................... Aa3/NR 7,450,000 Letter of Credit: Banque Nationale Paris Honolulu City & County, HI General Obligation Bonds, Series A $ 2,150,000 3.40%, 1/01/04, Weekly Reset*........................................... Aaa/AAA $ 2,150,000 Letter of Credit: Landesbank Hessen Honolulu City & County, HI General Obligation Bonds, Series A 5,145,000 3.40%, 1/01/17, Weekly Reset*........................................... Aaa/AAA 5,145,000 Letter of Credit: Landesbank Hessen Honolulu City & County, HI General Obligation Bonds, Series A 855,000 3.40%, 1/01/18, Weekly Reset*........................................... Aaa/AAA 855,000 Letter of Credit: Landesbank Hessen Honolulu City & County, HI General Obligation Bonds, Series A 1,500,000 3.40%, 1/01/19, Weekly Reset*........................................... Aaa/AAA 1,500,000 Letter of Credit: Landesbank Hessen Honolulu City & County, HI General Obligation Bonds, Series A 200,000 5.40%, 1/01/02.......................................................... AAA/AA- 203,030 Honolulu City & County, HI General Obligation Bonds, Series A 825,000 6.30%, 3/01/08.......................................................... Aa3/AA- 862,705 Secondary Market Sevices Corporation Hawaii Student Loan Revenue Bonds, Senior Series II 6,000,000 3.60%, 9/01/10, Weekly Reset*.......................................... MIG1/A-1+ 6,000,000 Letter of Credit: Student Loan Marketing Secondary Market Sevices Corporation Hawaii Student Loan Revenue Bonds, Senior Series II 1,700,000 3.60%, 9/01/35, Weekly Reset*........................................... MIG1/NR 1,700,000 ------------- Letter of Credit: Student Loan Marketing Total Hawaii.................................................... 60,035,961 ------------- IDAHO (1.5%) ------------------------------------------------------------------------ Idaho Health Facilities Authority Revenue Bonds (St. Lukes Regional Medical Center Project) 2,315,000 3.80%, 5/01/22, Daily Reset*............................................ VMIG1/NR 2,315,000 ------------- Letter of Credit: Bayerische Landesbank ILLINOIS (1.7%) ------------------------------------------------------------------------ Peoria, IL General Obligation Bonds $ 1,000,000 5.00%, 1/01/02.......................................................... Aaa/AAA $ 1,012,769 Insurance: Financial Guaranty Insurance Corporation Southwestern, IL Development Authority Environmental Improvement Revenue Bonds (Shell Oil Co. Wood River Project) 1,600,000 3.80%, 11/01/25, Daily Reset*........................................... VMIG1/A-1+ 1,600,000 ------------- Total Illinois.................................................. 2,612,769 ------------- INDIANA (5.6%) ------------------------------------------------------------------------ Indianapolis, IN Economic Development Revenue Bonds (Jewish Federation Campus) 6,150,000 3.55%, 4/01/05, Weekly Reset*........................................... VMIG1/NR 6,150,000 Purdue University, IN Universtity Revenue Bonds (Student Fee), Series H 1,790,000 3.50%, 7/01/17, Weekly Reset*........................................... VMIG1/A1+ 1,790,000 Purdue University, IN Universtity Revenue Bonds (Student Fee), Series L 720,000 3.50%, 7/01/20, Weekly Reset*........................................... VMIG1/A-1+ 720,000 Letter of Credit: Bank One N.A. Purdue University, IN Universtity Revenue Bonds (Student Fee), Series O 745,000 3.50%, 7/01/19, Weekly Reset*........................................... VMIG1/A-1+ 745,000 ------------- Total Indiana................................................... 9,405,000 ------------- IOWA (4.3%) ------------------------------------------------------------------------ Iowa Higher Education Loan Authority Revenue Bonds (Loros College Project) 6,690,000 3.80%, 11/01/30, Daily Reset*........................................... NR/A-1+ 6,690,000 ------------- Letter of Credit: Lasalle Bank N.A. KENTUCKY (1.6%) ------------------------------------------------------------------------ Kentucky State, Property & Buildings Community Revenue Bonds (Project 67) 1,535,000 4.20%, 9/01/01.......................................................... Aa3/AA- 1,540,277 Warsaw, KY Industrial Building Revenue Bonds (Operating Partnership) $ 1,000,000 3.60%, 8/01/09, Weekly Reset*........................................... NR/A-1+ $ 1,000,000 ------------- Letter of Credit: Fifth Third Bank N.A. Total Kentucky.................................................. 2,540,277 ------------- LOUISIANA (2.0%) ------------------------------------------------------------------------ St. Charles Parish, LA Pollution Control Revenue Bonds (Shell Oil Co. Project), Series A 1,000,000 3.80%, 10/01/22, Daily Reset*........................................... VMIG1/A-1+ 1,000,000 St. Charles Parish, LA Pollution Control Revenue Bonds (Shell Oil Co.-Norco Project) 2,100,000 3.80%, 9/01/23, Daily Reset*............................................ NR/AAA 2,100,000 ------------- Total Louisiana................................................. 3,100,000 ------------- MARYLAND (0.9%) ------------------------------------------------------------------------ Harford County, MD Public Improvement, General Obligation Bonds 1,350,000 4.25%, 1/15/02.......................................................... Aa2/AA 1,360,873 ------------- MASSACHUSETTS (1.9%) ------------------------------------------------------------------------ Massachusetts State, General Obligation Bonds, Series A 3,000,000 3.30%, 9/01/16, Weekly Reset*........................................... Aa2/AA- 3,000,000 ------------- Letter of Credit: Commerzbank A.G. MICHIGAN (1.0%) ------------------------------------------------------------------------ Michigan State, Strategic Fund Ltd. Revenue Bonds (Village at Ann Arbor LLC, Project), Series A, 1,485,000 3.50%, 2/15/34, Weekly Reset*........................................... VMIG1/NR 1,485,000 ------------- Letter of Credit: Fannie Mae Credit Facility MINNESOTA (8.0%) ------------------------------------------------------------------------ Cohasset, MN Revenue Bonds (Minnesota Power & Light Co. Project), Series A 335,000 3.80%, 6/01/20, Daily Reset*............................................ NR/A-1+ 335,000 Letter of Credit: ABN Amro Bank N.V. Cohasset, MN Revenue Bonds (Minnesota Power & Light Co. Project), Series C $ 1,350,000 3.80%, 6/01/13, Daily Reset*............................................ NR/A-1+ $ 1,350,000 Letter of Credit: ABN Amro Bank N.V. Cohasset, MN Revenue Bonds (Minnesota Power & Light Co. Project), Series D 100,000 3.80%, 12/01/07, Daily Reset*........................................... NR/A-1+ 100,000 Letter of Credit: ABN Amro Bank N.V. Hennepin County, MN General Obligation Bonds, Series A 500,000 4.50%, 12/01/01......................................................... Aaa/AAA 503,887 Hennepin County, MN General Obligation Bonds, Series B 620,000 3.35%, 12/01/20, Weekly Reset*.......................................... VMIG1/A-1+ 620,000 Letter of Credit: Landesbank Hessen Hennepin County, MN General Obligation Bonds, Series C 1,255,000 3.35%, 12/01/04, Weekly Reset*.......................................... VMIG1/A-1+ 1,255,000 Letter of Credit: Westdeutsche Landesbank Hennepin County, MN General Obligation Bonds, Series C 1,345,000 3.35%, 12/01/10, Weekly Reset*.......................................... VMIG1/A-1+ 1,345,000 Letter of Credit: Westdeutsche Landesbank Minneapolis, MN General Obligation Bonds, Series A 500,000 3.35%, 12/01/02, Weekly Reset*.......................................... VMIG1/A-1 500,000 Letter of Credit: Bayerische Vereinsbank Minneapolis, MN General Obligation Bonds, Series A 1,245,000 3.35%, 3/01/12, Weekly Reset*........................................... VMIG1/A-1 1,245,000 Letter of Credit: Bayerische Vereinsbank Minneapolis, MN General Obligation Bonds, Series B 2,850,000 3.35%, 12/01/16, Weekly Reset*.......................................... VMIG1/A-1 2,850,000 Letter of Credit: Bayerische Vereinsbank Minneapolis, MN General Obligation Bonds, (Public Works) 1,155,000 3.35%, 12/01/04, Weekly Reset*.......................................... VMIG1/A-1 1,155,000 Letter of Credit: Bayerische Vereinsbank Minneapolis, MN General Obligation Bonds, (Convention Center) $ 1,250,000 3.35%, 12/01/18, Weekly Reset*.......................................... VMIG1/A-1 $ 1,250,000 ------------- Total Minnesota................................................. 12,508,887 ------------- MISSOURI (0.2%) ------------------------------------------------------------------------ Missouri State, Health & Educational Facilities Revenue Bonds (Saint Louis University), Series B 280,000 3.85%, 10/01/24, Daily Reset*........................................... VMIG1/A-1+ 280,000 ------------- Letter of Credit: Bank of America N.A. NEW MEXICO (0.7%) ------------------------------------------------------------------------ New Mexico State, General Obligation Bonds, (Capital Projects) 1,000,000 4.50%, 3/01/02.......................................................... Aa1/AA+ 1,010,698 ------------- NEW YORK (1.8%) ------------------------------------------------------------------------ New York State, Power Authority Revenue & General Purpose Bonds, Series Z 300,000 6.25%, 1/01/04.......................................................... AAA/AAA 309,948 New York, NY General Obligation Bonds, Sub-series E5 2,500,000 3.45%, 8/01/16, Daily Reset*............................................ Aa2/AAA 2,500,000 ------------- Letter of Credit: Morgan Guaranty Trust Total New York.................................................. 2,809,948 ------------- NORTH CAROLINA (2.9%) ------------------------------------------------------------------------ Durham County, NC General Obligation Bonds, (Public Improvement Project) 2,975,000 3.50%, 2/01/11, Weekly Reset*........................................... VMIG1/A-1+ 2,975,000 Letter of Credit: Wachovia Bank of North Carolina Durham County, NC General Obligation Bonds, (Public Improvement Project) 1,475,000 3.50%, 2/01/13, Weekly Reset*........................................... VMIG1/A-1+ 1,475,000 ------------- Letter of Credit: Wachovia Bank of North Carolina Total North Carolina............................................ 4,450,000 ------------- OHIO (0.6%) ------------------------------------------------------------------------ Delaware County, OH General Obligation Bonds, (Sewer District Improvement) $ 1,000,000 3.60%, 12/01/01......................................................... Aaa/AAA $ 1,001,594 ------------- Insurance: Municipal Bond Insurance Association OREGON (1.4%) ------------------------------------------------------------------------ Emerald Peoples Utility District, OR Revenue Bonds, Series B 755,000 6.75%, 11/01/09......................................................... Aaa/AAA 769,612 Insurance: Financial Security Assurance Multnomah County, OR School District General Obligation Bonds, (Gresham) 1,400,000 5.80%, 1/01/04.......................................................... A1/A+ 1,414,522 ------------- Total Oregon.................................................... 2,184,134 ------------- PENNSYLVANIA (2.4%) ------------------------------------------------------------------------ Allegheny County, PA General Obligation Bonds, Series C-38 1,000,000 6.40%, 9/01/03.......................................................... Aaa/AAA 1,008,498 Insurance: American Municipal Bond Assurance Corporation Pennsylvania State Higher Education Facilities College & University Revenue Bonds, (College of Pharmacy & Science) 1,000,000 4.45%, 11/01/01......................................................... Aaa/AAA 1,006,588 Insurance: Municipal Bond Insurance Association Pennsylvania State, General Obligation Bonds, First Series 655,000 5.25%, 1/15/02.......................................................... Aa2/AA 659,235 Trinity Area School District, PA General Obligation Bonds 1,000,000 6.63%, 11/01/11......................................................... Aaa/AAA 1,019,690 ------------- Insurance: Financial Guaranty Insurance Corporation Total Pennsylvania.............................................. 3,694,011 ------------- TENNESSEE (1.5%) ------------------------------------------------------------------------ Kingsport, TN General Obligation Bonds, (General Inprovement) $ 1,000,000 5.40%, 9/01/01.......................................................... A1/NR $ 1,008,545 Memphis, TN General Obligation Bonds, (Capital Outlay Notes) 1,400,000 4.30%, 5/01/01.......................................................... Aa2/AA 1,400,887 ------------- Total Tennessee................................................. 2,409,432 ------------- TEXAS (7.1%) ------------------------------------------------------------------------ Austin, TX Utility System Revenue Bonds 1,500,000 6.50%, 10/01/01......................................................... AAA/AAA 1,515,241 Gulf Coast Waste Disposal Authority, TX Revenue Bonds, (AMOCO Oil Co. Project) 2,400,000 3.80%, 7/01/27, Daily Reset*............................................ Aa1/AA+ 2,400,000 Irving Independent School District, TX General Obligation Bonds 1,315,000 5.00%, 2/15/07.......................................................... Aaa/AAA 1,333,890 Insurance: Permanent School Fund Guaranteed Lower Neches Valley Authority, TX Pollution Control Revenue Bonds, (Chevron U.S.A., Inc. Income Project) 1,500,000 3.25%, 2/15/17.......................................................... P-1/AA 1,500,000 Texas State, Tax & Revenue Anticipation Notes 2,000,000 5.25%, 8/31/01.......................................................... MIG1/SP-1+ 2,015,461 West Side Calhoun County, TX Sewer & Solid Waste Disposal Revenue Bonds, (BP Chemicals, Inc. Project) 2,200,000 3.80%, 4/01/31, Daily Reset*............................................ P-1/A-1+ 2,200,000 ------------- Letter of Credit: Guaranty Agreement Total Texas..................................................... 10,964,592 ------------- UTAH (0.8%) ------------------------------------------------------------------------ University of Utah Revenue Bonds (Auxiliary & Campus Facilities), Series A 1,200,000 3.40%, 4/01/27, Weekly Reset*........................................... VMIG1/A-1+ 1,200,000 ------------- Letter of Credit: Bank of Nova Scotia WASHINGTON (4.5%) ------------------------------------------------------------------------ King & Snohomish Counties, School District WA General Obligation Bonds, (Northshore), Series C 1,000,000 4.00%, 6/15/01.......................................................... Aa3/AA- 999,242 Seattle, WA Water System Revenue Bonds 1,000,000 3.40%, 9/01/25, Weekly Reset*........................................... VMIG1/A-1+ 1,000,000 Letter of Credit: Bayerische Landesbank Snohomish County, WA Public Hospital General Obligation Bonds, (Stevens Memorial Hospital) $ 500,000 6.85%, 12/01/11......................................................... Aaa/AAA $ 511,195 Insurance: Financial Guaranty Insurance Corporation Washington State Health Care Facility Authority Revenue Bonds, (Fred Hutchinson Cancer Research Center) 4,505,000 3.75%, 1/01/29, Daily Reset*............................................ VMIG1/NR 4,505,000 ------------- Letter of Credit: Bank of America Total Washington................................................ 7,015,437 ------------- WISCONSIN (2.2%) ------------------------------------------------------------------------ Milwaukee, WI Metropolitan Sewer District General Obligation Bonds, Series A 1,000,000 6.70%, 10/01/01......................................................... Aa1/NR 1,011,200 Milwaukee County, WI General Obligation Bonds, Series A 2,445,000 6.50%, 12/01/09......................................................... NR/AA 2,480,123 ------------- Total Wisconsin................................................. 3,491,323 ------------- WYOMING (0.6%) ------------------------------------------------------------------------ Campbell County, WY School District General Obligation Bonds, (Gillette) 1,000,000 5.05%, 6/01/01.......................................................... Aaa/AAA 1,001,094 ------------- Letter of Credit: School Board Guaranty Total Bonds and Notes........................................... 155,254,816 ------------- INVESTMENT COMPANY (0.0%) ------------------------------------------------------------------------ 55,000 Dreyfus Tax Exempt Money Market Fund.................................... 55,000 ------------- Total Investments (amortized cost $155,309,816**)................... 99.9% 155,309,816 Other assets less liabilities....................................... 0.1 143,082 ------ ------------- Net Assets.......................................................... 100.0% $155,452,898 ------ -------------
(*) Variable rate obligation payable at par on demand at any time on no more than seven days notice. (**) Cost for Federal tax purposes is identical. See accompanying notes to financial statements. PACIFIC CAPITAL U.S. GOVERNMENT SECURITIES CASH ASSETS TRUST STATEMENT OF INVESTMENTS MARCH 31, 2001
FACE AMOUNT U.S. GOVERNMENT AGENCIES (100.5%) VALUE - ------------ ------------------------------------------------------------------------- ------------ FEDERAL FARM CREDIT BANK (15.5%) ------------------------------------------------------------------------- $ 10,000,000 4.72%, due 4/10/01 ...................................................... $ 9,988,200 13,000,000 5.94%, due 4/12/01 ...................................................... 12,976,405 19,000,000 5.23%, due 4/25/01 ...................................................... 18,933,753 24,000,000 4.60%, due 11/02/01 ..................................................... 23,340,666 10,000,000 5.60%, due 12/13/01 ..................................................... 9,601,778 ------------ Total Federal Farm Credit Bank ..................................... 74,840,802 ------------ FEDERAL HOME LOAN BANK (80.9%) ------------------------------------------------------------------------- 64,623,000 5.13%, due 4/02/01 ...................................................... 64,613,791 80,000,000 5.26%, due 4/06/01 ...................................................... 79,941,528 30,000,000 4.91%, due 4/18/01 ...................................................... 29,930,442 18,000,000 5.13%, due 5/02/01 ...................................................... 17,920,485 25,000,000 4.95%, due 5/09/01 ...................................................... 24,869,375 50,000,000 4.93%, due 5/11/01 ...................................................... 49,726,111 15,000,000 5.92%, due 5/15/01 ...................................................... 14,891,467 25,000,000 4.85%, due 6/01/01 ...................................................... 24,794,549 25,000,000 4.87%, due 6/06/01 ...................................................... 24,776,792 10,000,000 5.82%, due 6/20/01 ...................................................... 9,870,667 25,000,000 4.68%, due 8/29/01 ...................................................... 24,513,021 25,000,000 4.64%, due 8/31/01 ...................................................... 24,510,222 ------------ Total Federal Home Loan Bank ....................................... 390,358,450 ------------ STUDENT LOAN MARKETING ASSOCIATION (2.0%) ------------------------------------------------------------------------- 10,000,000 5.12%, due 6/29/01 ...................................................... 9,873,422 ------------ TENNESEE VALLEY AUTHORITY (2.1%) ------------------------------------------------------------------------- 10,000,000 4.72%, due 5/11/01 ...................................................... 9,947,555 ------------ Total U.S. Government Agencies...................................... 485,020,229 ------------ Total Investments (amortized cost $485,020,229*).......... 100.5% 485,020,229 Other assets less liabilities............................. (0.5) (2,361,301) ------ ------------ Net Assets................................................ 100.0% $482,658,928 ====== ============
(*) Cost for Federal tax purposes is identical. See accompanying notes to financial statements. THE PACIFIC CAPITAL FUNDS OF CASH ASSETS TRUST STATEMENTS OF ASSETS AND LIABILITIES MARCH 31, 2001
CASH TAX-FREE GOVERNMENT FUND FUND FUND ------------- ------------- ------------- ASSETS: Investments at value (cost $504,860,418, $155,309,816 and $485,020,229, respectively) ....................................... $ 504,860,418 $ 155,309,816 $ 485,020,229 Repurchase agreements (cost $83,000,000) ................ 83,000,000 - - Cash .................................................... 818 2,351 714 Interest receivable ..................................... 95,870 1,078,846 - Other assets ............................................ 7,145 11,881 240 ------------- ------------- ------------- Total Assets ........................................ 587,964,251 156,402,894 485,021,183 ------------- ------------- ------------- LIABILITIES: Dividends payable ....................................... 2,258,595 335,710 2,082,634 Payable for investment securities purchased ............. - 522,707 - Adviser and Administrator fees payable .................. 240,777 49,010 179,212 Distribution fees payable ............................... 45,978 11,374 68,766 Accrued expenses ........................................ 54,524 31,195 31,643 ------------- ------------- ------------- Total Liabilities ................................... 2,599,874 949,996 2,362,255 ------------- ------------- ------------- NET ASSETS .............................................. $ 585,364,377 $ 155,452,898 $ 482,658,928 ============= ============= ============= NET ASSETS CONSIST OF: Capital Stock - Authorized an unlimited number of shares, par value $.01 per share ............................ $ 5,855,558 $ 1,554,508 $ 4,826,432 Additional paid-in capital .............................. 579,700,002 154,085,684 477,816,902 Accumulated net realized loss on investments ............ (196,672) (32) (11,323) Undistributed (overdistributed) net investment income ... 5,489 (187,262) 26,917 ------------- ------------- ------------- $ 585,364,377 $ 155,452,898 $ 482,658,928 ============= ============= ============= SHARES OF BENEFICIAL INTEREST: Original Shares Class: Net Assets .......................................... $ 364,269,242 $ 101,023,412 $ 151,027,869 ============= ============= ============= Shares outstanding .................................. 364,621,474 101,022,004 151,018,449 ============= ============= ============= Net asset value per share ........................... $1.00 $1.00 $1.00 ============= ============= ============= Service Shares Class: Net Assets .......................................... $ 221,095,135 $ 54,429,486 $ 331,631,059 ============= ============= ============= Shares outstanding .................................. 220,934,314 54,428,799 331,624,747 ============= ============= ============= Net asset value per share ........................... $1.00 $1.00 $1.00 ============= ============= =============
See accompanying notes to financial statements. THE PACIFIC CAPITAL FUNDS OF CASH ASSETS TRUST STATEMENTS OF OPERATIONS FOR THE YEAR ENDED MARCH 31, 2001
CASH TAX-FREE GOVERNMENT FUND FUND FUND ------------ ----------- ------------ INVESTMENT INCOME: Interest income .................................... $ 38,891,599 $ 5,521,480 $ 30,328,924 ------------ ----------- ------------ EXPENSES: Investment Adviser fees (note 3) ................... 2,315,990 395,214 1,578,335 Administrator fees (note 3) ........................ 754,843 152,909 378,425 Distribution fees (note 3) ......................... 514,514 125,166 853,801 Trustees' fees and expenses ........................ 151,603 55,511 117,616 Legal fees ......................................... 54,036 15,403 37,789 Shareholders' reports .............................. 50,375 5,232 23,218 Registration fees and dues ......................... 49,962 8,141 36,838 Transfer and shareholder servicing agent fees ...... 28,481 29,515 26,073 Fund accounting fees ............................... 26,993 28,214 29,388 Insurance .......................................... 24,911 6,044 18,845 Audit and accounting fees .......................... 17,000 15,000 16,000 Custodian fees ..................................... 7,427 6,524 6,518 Miscellaneous ...................................... 11,252 2,722 28,544 ------------ ----------- ------------ Total expenses ..................................... 4,007,387 845,595 3,151,390 Expenses paid indirectly (note 6) .................. (5,025) (292) (40) ------------ ----------- ------------ Net expenses ....................................... 4,002,362 845,303 3,151,350 Net investment income .................................. 34,889,237 4,676,177 27,177,574 Net realized gain (loss) from securities transactions .. 180,534 9 (1,298) ------------ ----------- ------------ Net increase in net assets resulting from operations ... $ 35,069,771 $ 4,676,186 $ 27,176,276 ============ =========== ============
See accompanying notes to financial statements. THE PACIFIC CAPITAL FUNDS OF CASH ASSETS TRUST STATEMENTS OF CHANGES IN NET ASSETS
CASH FUND TAX-FREE FUND YEAR YEAR YEAR YEAR ENDED ENDED ENDED ENDED MARCH 31, 2001 MARCH 31, 2000 MARCH 31, 2001 MARCH 31, 2000 INCREASE (DECREASE) IN NET ASSETS OPERATIONS: Net investment income .................. $ 34,889,237 $ 27,536,758 $ 4,676,177 $ 3,740,384 Net realized gain (loss) from securities transactions ........ 180,534 34,316 9 - Change in net assets resulting from operations ........... 35,069,771 27,571,074 4,676,186 3,740,384 DIVIDENDS TO SHAREHOLDERS FROM NET INVESTMENT INCOME: Original Shares ..................... (23,573,272) (19,411,107) (3,045,910) (2,530,922) Service Shares ...................... (11,315,968) (8,125,651) (1,630,270) (1,209,462) Total dividends to shareholders from net investment income .......... (34,889,240) (27,536,758) (4,676,180) (3,740,384) CAPITAL SHARE TRANSACTIONS (at $1.00 per share): Proceeds from shares sold: Original Shares ..................... 1,189,421,376 1,186,795,291 220,494,187 168,207,597 Service Shares ...................... 551,244,651 377,884,308 78,052,725 65,317,175 1,740,666,027 1,564,679,599 298,546,912 233,524,772 Reinvested dividends and distributions: Original Shares ..................... 440,228 222,982 102,162 98,624 Service Shares ...................... 11,262,288 7,899,056 1,643,226 1,169,590 11,702,516 8,122,038 1,745,388 1,268,214 Cost of shares redeemed: Original Shares ..................... (1,338,658,170) (1,091,834,549) (219,993,644) (151,311,068) Service Shares ...................... (515,858,167) (374,062,057) (75,961,888) (63,349,933) (1,854,516,337) (1,465,896,606) (295,955,532) (214,661,001) Change in net assets from capital share transactions ..... (102,147,794) 106,905,031 4,336,768 20,131,985 Total change in net assets ............. (101,967,263) 106,939,347 4,336,774 20,131,985 NET ASSETS: Beginning of period ................. 687,331,640 580,392,293 151,116,124 130,984,139 End of period ....................... $ 585,364,377 $ 687,331,640 $ 155,452,898 $ 151,116,124
GOVERNMENT FUND YEAR YEAR ENDED ENDED MARCH 31, 2001 MARCH 31, 2000 INCREASE (DECREASE) IN NET ASSETS OPERATIONS: Net investment income .................. $ 27,177,574 $ 17,020,919 Net realized gain (loss) from securities transactions ........ (1,298) (1,535) Change in net assets resulting from operations ........... 27,176,276 17,019,384 DIVIDENDS TO SHAREHOLDERS FROM NET INVESTMENT INCOME: Original Shares ..................... (8,495,952) (6,323,047) Service Shares ...................... (18,681,612) (10,697,872) Total dividends to shareholders from net investment income .......... (27,177,564) (17,020,919) CAPITAL SHARE TRANSACTIONS (at $1.00 per share): Proceeds from shares sold: Original Shares ..................... 485,087,392 427,019,622 Service Shares ...................... 1,309,461,793 1,062,992,710 1,794,549,185 1,490,012,332 Reinvested dividends and distributions: Original Shares ..................... 121,323 48,859 Service Shares ...................... 18,404,173 10,263,790 18,525,496 10,312,649 Cost of shares redeemed: Original Shares ..................... (499,868,675) (401,257,550) Service Shares ...................... (1,289,539,902) (994,232,663) (1,789,408,577) (1,395,490,213) Change in net assets from capital share transactions ..... 23,666,104 104,834,768 Total change in net assets ............. 23,664,816 104,833,233 NET ASSETS: Beginning of period ................. 458,994,112 354,160,879 End of period ....................... $ 482,658,928 $ 458,994,112
See accompanying notes to financial statements. THE PACIFIC CAPITAL FUNDS OF CASH ASSETS TRUST NOTES TO FINANCIAL STATEMENTS 1. ORGANIZATION Cash Assets Trust (the "Trust") was organized on May 7, 1984 as a Massachusetts business trust and is registered under the Investment Company Act of 1940 (the "1940 Act") as an open-end investment company. The Trust consists of the following three investment portfolios (referred to individually as a "Fund" and collectively as the "Funds"): Pacific Capital Cash Assets Trust (a diversified portfolio which commenced operations on December 5, 1984), Pacific Capital Tax-Free Cash Assets Trust (a non-diversified portfolio which commenced operations on April 4, 1989), and Pacific Capital U.S. Government Securities Cash Assets Trust (a diversified portfolio which commenced operations on April 4, 1989). The Trust is authorized to issue for each Fund an unlimited number of shares of $.01 par value in two classes of shares; the Original Shares Class and the Service Shares Class. The Original Shares Class includes all currently outstanding shares of each Fund that were issued prior to January 20, 1995, the date on which the Capital structure was changed to include two classes rather than one. The two classes of shares are substantially identical, except that Service Shares bear the fees that are payable under the Trust's Distribution Plan. 2. SIGNIFICANT ACCOUNTING POLICIES The following is a summary of significant accounting policies followed by the Funds in the preparation of their financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America for investment companies. a) PORTFOLIO VALUATION: Each Fund's portfolio securities are valued by the amortized cost method permitted in accordance with Rule 2a-7 under the 1940 Act, which, after considering accrued interest thereon, approximates market. Under this method, a portfolio security is valued at cost adjusted for amortization of premiums and accretion of discounts. Amortization of premiums and accretion of discounts are included in interest income. b) SECURITIES TRANSACTIONS AND RELATED INVESTMENT INCOME: Securities transactions are recorded on the trade date. Realized gains and losses from securities transactions are reported on the identified cost basis. Interest income is recorded daily on the accrual basis and is adjusted for amortization of premiums and accretion of discounts as discussed in the preceding paragraph. c) DETERMINATION OF NET ASSET VALUE AND CALCULATION OF EXPENSES: The net asset value per share for each class of the Funds' shares is determined as of 4:00 p.m. New York time on each day that the New York Stock Exchange is open by dividing the value of the assets of the Fund allocable to that class less Fund liabilities allocable to the class and any liabilities charged directly to the class, exclusive of surplus, by the total number of shares of the class outstanding. Investment income, realized and unrealized gains and losses, if any, and expenses other than class specific expenses, are allocated daily to each class of shares based upon the proportion of net assets of each class. Class specific expenses are borne by the affected class. Service fee payments under Rule 12b-1 are borne solely by and charged to the Service Shares based on net assets of that class. d) FEDERAL INCOME TAXES: It is the policy of each Fund to qualify as a regulated investment company by complying with the provisions of the Internal Revenue Code applicable to certain investment companies. Each Fund intends to make distributions of income and securities profits sufficient to relieve it from all, or substantially all, Federal income and excise taxes. e) REPURCHASE AGREEMENTS: It is each Fund's policy to monitor closely the creditworthiness of all firms with which it enters into repurchase agreements, and to take possession of, or otherwise perfect its security interest in, securities purchased under agreements to resell. The securities purchased under agreements to resell are marked to market every business day in order to compare the value of the collateral to the amount of the "loan" (repurchase agreements being defined as "loans" in the 1940 Act), including the accrued interest earned thereon. If the value of the collateral is less than 102% of the loan plus the accrued interest thereon, additional collateral is required from the borrower. f) USE OF ESTIMATES: The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates. 3. FEES AND RELATED PARTY TRANSACTIONS a) MANAGEMENT ARRANGEMENTS: Asset Management Group of Bank of Hawaii (formerly Pacific Century Trust) (the "Adviser"), serves as Investment Adviser to the Trust. In this role, under Investment Advisory Agreements, the Adviser supervises the Funds' investments and provides various services. The Funds also have Administration Agreements with Aquila Management Corporation (the "Administrator") to provide all administrative services to the Funds other than those relating to the investment portfolio and the maintenance of the accounting books and records. Specific details as to the nature and extent of the services provided by the Adviser and the Administrator are more fully defined in the Prospectus and Statement of Additional Information of the Funds. For their services, the Adviser and the Administrator each receive a fee which is payable monthly and computed as of the close of business each day on the net assets of each Fund at the following annual rates: Pacific Capital Cash Assets Trust - On net assets up to $325 million, the fee is paid to the Adviser and the Administrator at the annual rate of 0.33% and 0.17%, respectively, and on net assets above that amount at the annual rate of 0.43% and 0.07%, respectively. Pacific Capital Tax-Free Cash Assets Trust - On net assets up to $95 million, the fee is paid to the Adviser and the Administrator at the annual rate of 0.27% and 0.13%, respectively, and on net assets above that amount at the annual rate of 0.33% and 0.07%, respectively. Pacific Capital U.S. Government Securities Cash Assets Trust - On net assets up to $60 million, the fee is paid to the Adviser and the Administrator at the annual rate of 0.27% and 0.13%, respectively, and on net assets above that amount at the annual rate of 0.33% and 0.07%, respectively. The Adviser and the Administrator each agrees that the above fees shall be reduced, but not below zero, by an amount equal to its proportionate share (determined on the basis of the respective fees computed as described above) of the amount, if any, by which the total expenses of a Fund in any fiscal year, exclusive of taxes, interest and brokerage fees, shall exceed the lesser of (i) 2.5% of the first $30 million of average annual net assets of the Fund plus 2% of the next $70 million of such assets and 1.5% of its average annual net assets in excess of $100 million, or (ii) 25% of the Fund's total annual investment income. The payment of the above fees at the end of any month will be reduced or postponed so that at no time will there be any accrued but unpaid liability under this expense limitation. No such reduction in fees was required during the year ended March 31, 2001. b) DISTRIBUTION AND SERVICE FEES: Each Fund has adopted a Distribution Plan (the "Plan") pursuant to Rule 12b-1 under the 1940 Act. A part of the Plan authorizes payment of certain distribution or service fees by the Service Shares Class of the Fund. Such payments are made to "Designated Payees"- broker-dealers, other financial institutions and service providers who have entered into appropriate agreements with the Distributor and which have rendered assistance in the distribution and/or retention of the Funds' Service Shares or in the servicing of Service Share accounts. The total payments under this part of a Fund's Plan may not exceed 0.25 of 1% of its average annual assets represented by Service Shares. No such payments will be made by the Original Share Class. Specific details about each Plan are more fully defined in the Prospectus and Statement of Additional Information of the Funds. Under a Distribution Agreement, Aquila Distributors, Inc. (the "Distributor") serves as the exclusive distributor of the Funds' shares. No compensation or fees are paid to the Distributor for such share distribution. 4. DISTRIBUTIONS The Funds declare dividends daily from net investment income and make payments monthly in additional shares at the net asset value per share, in cash, or a combination of both, at the shareholder's option. At March 31, 2000, the Cash Fund had a capital loss carryover of $196,672 which expires on March 31, 2002, and the Government Fund had a capital loss carryover of $10,026 of which $9,725 expires on March 31, 2008, and $301 of which expires on March 31, 2009. These amounts are available to offset future net realized gains on securities transactions to the extent provided for in the Internal Revenue Code and it is probable the gains so offset will not be distributed. On March 31, 2001, Pacific Capital Tax Free Cash Assets Trust reduced its undistributed net investment income and increased its paid in capital by $187,259 representing certain permanant differences between tax and financial accounting. Net assets of the Fund were not affected by the reclassification. 5. GUARANTEES OF CERTAIN COMMERCIAL PAPER Various banks and other institutions have issued irrevocable letters of credit or guarantees for the benefit of the holders of certain commercial paper. Payment at maturity of principal and interest of certain commercial paper held by the Funds is supported by such letters of credit or guarantees. 6. EXPENSES The Funds have negotiated an expense offset arrangement with their custodian, wherein they receive credit toward the reduction of custodian fees and other expenses whenever there are uninvested cash balances. The Statements of Operations reflect the total expenses before any offset, the amount of offset and the net expenses. It is the general intention of the Funds to invest, to the extent practicable, some or all of cash balances in income-producing assets rather than leave cash on deposit. 7. PORTFOLIO ORIENTATION Since the Pacific Capital Tax-Free Cash Assets Trust has a significant portion of its investments in obligations of issuers within Hawaii, it is subject to possible risks associated with economic, political, or legal developments or industrial or regional matters specifically affecting Hawaii and whatever effects these may have upon Hawaii issuers ability to meet their obligations. FEDERAL TAX STATUS OF DISTRIBUTIONS (UNAUDITED) This information is presented in order to comply with a requirement of the Internal Revenue Code AND NO CURRENT ACTION ON THE PART OF SHAREHOLDERS IS REQUIRED. For the fiscal year ended March 31, 2001, the Federal tax status of the total amount of dividends paid by each of the investment portfolios comprising Cash Assets Trust is as follows: FUND FEDERAL TAX STATUS ------------------------------------------ ------------------------- Pacific Capital Cash Assets Trust Ordinary dividend income Pacific Capital Tax-Free Cash Assets Trust Exempt-interest dividends Pacific Capital U.S. Government Securities Cash Assets Trust Ordinary dividend income Prior to January 31, 2001, shareholders were mailed IRS Form 1099-DIV which contained information on the status of distributions paid for the 2000 CALENDAR YEAR. PACIFIC CAPITAL CASH ASSETS TRUST FINANCIAL HIGHLIGHTS FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
ORIGINAL SHARES SERVICE SHARES -------------------------------------- -------------------------------------- YEAR ENDED MARCH 31, YEAR ENDED MARCH 31, -------------------------------------- -------------------------------------- 2001 2000 1999 1998 1997 2001 2000 1999 1998 1997 ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ Net asset value, beginning of period ..... $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ Income from investment operations: Net investment income ................. 0.06 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ Less distributions: Dividends from net investment income ............................. (0.06) (0.05) (0.05) (0.05) (0.05) (0.05) (0.05) (0.05) (0.05) (0.05) ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ Net asset value, end of period ........... $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 ====== ====== ====== ====== ====== ====== ====== ====== ====== ====== Total return ............................. 5.90% 4.89% 4.90% 5.15% 4.88% 5.63% 4.63% 4.64% 4.88% 4.62% Ratios/supplemental data Net assets, end of period (in millions) ...................... $364 $513 $418 $419 $421 $221 $174 $163 $113 $66 Ratio of expenses to average net assets ............................. 0.57% 0.56% 0.57% 0.58% 0.60% 0.82% 0.81% 0.81% 0.83% 0.85% Ratio of net investment income to average net assets ................. 5.77% 4.80% 4.79% 5.03% 4.78% 5.49% 4.53% 4.51% 4.77% 4.53% The expense ratios after giving effect to the expense offset for uninvested cash balances were: Ratio of expenses to average net assets ............................. 0.57% 0.56% 0.56% 0.57% 0.60% 0.82% 0.81% 0.81% 0.82% 0.85%
See accompanying notes to financial statements. PACIFIC CAPITAL TAX-FREE CASH ASSETS TRUST FINANCIAL HIGHLIGHTS FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
ORIGINAL SHARES SERVICE SHARES -------------------------------------- -------------------------------------- YEAR ENDED MARCH 31, YEAR ENDED MARCH 31, -------------------------------------- -------------------------------------- 2001 2000 1999 1998 1997 2001 2000 1999 1998 1997 ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ Net asset value, beginning of period ..... $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ Income from investment operations: Net investment income ................. 0.04 0.03 0.03 0.03 0.03 0.03 0.03 0.03 0.03 0.03 ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ Less distributions: Dividends from net investment income ............................. (0.04) (0.03) (0.03) (0.03) (0.03) (0.03) (0.03) (0.03) (0.03) (0.03) ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ Net asset value, end of period ........... $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 ====== ====== ====== ====== ====== ====== ====== ====== ====== ====== Total return ............................. 3.58% 2.95% 2.91% 3.08% 3.00% 3.32% 2.70% 2.65% 2.83% 2.75% Ratios/supplemental data Net assets, end of period (in millions) ...................... $101 $100 $83 $77 $91 $54 $51 $48 $37 $26 Ratio of expenses to average net assets ............................ 0.53% 0.52% 0.54% 0.63% 0.55% 0.78% 0.77% 0.79% 0.88% 0.80% Ratio of net investment income to average net assets ................. 3.50% 2.93% 2.85% 3.04% 2.97% 3.26% 2.66% 2.64% 2.79% 2.70% The expense ratios after giving effect to the expense offset for uninvested cash balances were: Ratio of expenses to average net assets ............................. 0.53% 0.52% 0.53% 0.63% 0.55% 0.78% 0.77% 0.78% 0.88% 0.80%
See accompanying notes to financial statements. PACIFIC CAPITAL U.S. GOVERNMENT SECURITIES CASH ASSETS TRUST FINANCIAL HIGHLIGHTS FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
ORIGINAL SHARES SERVICE SHARES -------------------------------------- -------------------------------------- YEAR ENDED MARCH 31, YEAR ENDED MARCH 31, -------------------------------------- -------------------------------------- 2001 2000 1999 1998 1997 2001 2000 1999 1998 1997 ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ Net asset value, beginning of period ..... $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ Income from investment operations: Net investment income ................ 0.06 0.05 0.04 0.05 0.05 0.05 0.04 0.04 0.05 0.04 ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ Less distributions: Dividends from net investment income ............................. (0.06) (0.05) (0.04) (0.05) (0.05) (0.05) (0.04) (0.04) (0.05) (0.04) ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ Net asset value, end of period ........... $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 ====== ====== ====== ====== ====== ====== ====== ====== ====== ====== Total return ............................. 5.88% 4.83% 4.80% 4.95% 4.76% 5.62% 4.56% 4.54% 4.69% 4.50% Ratios/supplemental data Net assets, end of period (in millions) ...................... $151 $166 $140 $101 $66 $332 $293 $214 $150 $83 Ratio of expenses to average net assets ............................. 0.47% 0.49% 0.49% 0.52% 0.56% 0.72% 0.74% 0.74% 0.77% 0.80% Ratio of net investment income to average net assets ................. 5.73% 4.73% 4.70% 4.85% 4.65% 5.47% 4.50% 4.42% 4.60% 4.42% The expense ratios after giving effect to the expense offset for uninvested cash balances were: Ratio of expenses to average net assets ............................. 0.47% 0.49% 0.49% 0.52% 0.55% 0.72% 0.74% 0.74% 0.77% 0.79%
See accompanying notes to financial statements. -----END PRIVACY-ENHANCED MESSAGE-----