N-CSR

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D. C. 20549

FORM N-CSR

Investment Company Act file number 811-04760

DWS Advisor Funds

(Exact Name of Registrant as Specified in Charter)

345 Park Avenue

New York, NY 10154-0004

(Address of Principal Executive Offices) (Zip Code)

Registrant’s Telephone Number, including Area Code: (212) 454-7190

Paul Schubert

345 Park Avenue

New York, NY 10154-0004

(Name and Address of Agent for Service)

Date of fiscal year end: 10/31

Date of reporting period: 10/31/09

ITEM 1.REPORT TO STOCKHOLDERS

OCTOBER 31, 2009

Annual Report
to Shareholders

DWS Short Duration Fund

Contents

4 Performance Summary

7 Information About Your Fund's Expenses

9 Portfolio Management Review

14 Portfolio Summary

15 Investment Portfolio

28 Financial Statements

32 Financial Highlights

37 Notes to Financial Statements

50 Report of Independent Registered Public Accounting Firm

51 Tax Information

52 Investment Management Agreement Approval

57 Summary of Management Fee Evaluation by Independent Fee Consultant

62 Board Members and Officers

66 Account Management Resources

This report must be preceded or accompanied by a prospectus. To obtain a summary prospectus, if available, or prospectus for any of our funds, refer to the Account Management Resources information provided in the back of this booklet. We advise you to consider the fund's objectives, risks, charges and expenses carefully before investing. The summary prospectus and prospectus contain this and other important information about the fund. Please read the prospectus carefully before you invest.

Investments in mutual funds involve risk. Some funds have more risk than others. In the current market environment, mortgage-backed securities are experiencing increased volatility. The fund invests in individual bonds whose yields and market values fluctuate so that your investment may be worth more or less than its original cost. Bond investments are subject to interest rate risk such that when interest rates rise, the prices of the bonds, and thus the value of the bond fund, may decline and the investor may lose principal value. Investors in the fund should be able to withstand fluctuations in the fixed income markets. The yield and value of the fund changes every day and can be affected by changes in interest rates, general market conditions and other political, social and economic developments, as well as specific matters relating to the companies in whose securities a fund invests. Derivatives may be more volatile and less liquid than traditional securities, and the fund could suffer losses on its derivatives positions. All of these factors may result in greater share price volatility. Please read the fund's prospectus for specific details regarding its investments and risk profile.

DWS Investments is part of Deutsche Bank's Asset Management division and, within the US, represents the retail asset management activities of Deutsche Bank AG, Deutsche Bank Trust Company Americas, Deutsche Investment Management Americas Inc. and DWS Trust Company.

NOT FDIC/NCUA INSURED NO BANK GUARANTEE MAY LOSE VALUE NOT A DEPOSIT NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY

Performance Summary October 31, 2009

Average Annual Total Returns as of 10/31/09
Unadjusted for Sales Charge	1-Year	3-Year	5-Year	10-Year
Class A	6.62%	1.82%	2.27%	3.55%
Class B	5.83%	1.04%	1.56%	2.82%
Class C	5.85%	1.05%	1.56%	2.81%
Adjusted for the Maximum Sales Charge
Class A (max 2.75% load)	3.69%	0.88%	1.70%	3.26%
Class B (max 4.00% CDSC)	2.83%	0.43%	1.39%	2.82%
Class C (max 1.00% CDSC)	5.85%	1.05%	1.56%	2.81%
No Sales Charges
Class S	7.01%	2.11%	2.39%	3.61%
Institutional Class	6.90%	2.06%	2.42%	3.72%
Barclays Capital 1-3 Year Government/Credit Index+	6.31%	5.39%	4.25%	4.89%
BOA Merrill Lynch 1-3 Year US Treasury Index++	2.73%	5.11%	4.02%	4.53%

Sources: Lipper Inc. and Deutsche Investment Management Americas Inc.

Performance in the Average Annual Total Returns table above and the Growth of an Assumed $10,000 Investment line graph that follows is historical and does not guarantee future results. Investment return and principal fluctuate, so your shares may be worth more or less when redeemed. Current performance may differ from performance data shown. Please visit www.dws-investments.com for the Fund's most recent month-end performance. Performance includes reinvestment of all distributions. Unadjusted returns do not reflect sales charges and would have been lower if they had.

The gross expense ratios of the Fund, as stated in the fee table of the prospectus dated March 1, 2009 are 0.95%, 1.84%, 1.74%, 0.75% and 0.68% for Class A, Class B, Class C, Class S and Institutional Class shares, respectively, and may differ from the expense ratios disclosed in the Financial Highlights tables in this report.

Index returns, unlike Fund returns, do not reflect any fees or expenses. It is not possible to invest directly into an index.

Performance figures do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.

Returns shown for Class A, B and C shares for the period prior to their inception on February 28, 2003 and for Class S shares for the periods prior to its inception on February 1, 2005 are derived from the historical performance of Institutional Class shares of DWS Short Duration Fund during such periods and have been adjusted to reflect the higher total annual operating expenses of each specific class. Any difference in expenses will affect performance.

Growth of an Assumed $10,000 Investment (Adjusted for Maximum Sales Charge)

[] DWS Short Duration Fund — Class A

[] Barclays Capital 1-3 Year Government/Credit Index⁺

[] BOA Merrill Lynch 1-3 Year US Treasury Index⁺⁺

Yearly periods ended October 31

The Fund's growth of an assumed $10,000 investment is adjusted for the maximum sales charge of 2.75%. This results in a net initial investment of $9,725.

The growth of $10,000 is cumulative.

Performance of other share classes will vary based on the sales charges and the fee structure of those classes.

⁺Barclays Capital 1-3 Year Government /Credit Index is an unmanaged index consisting of all US government agency Treasury securities, as well as all investment grade corporate debt securities with maturities of one to three years. On August 1, 2009, the Barclays Capital 1-3 Year Government/Credit Index replaced the Merrill Lynch 1-3 Year US Treasury Index as the fund's benchmark index because the advisor believes that it more accurately reflects the fund's investment strategy.

⁺⁺ BOA Merrill Lynch 1-3 Year US Treasury Index (name changed from Merrill Lynch 1-3 Year US Treasury Index effective September 25, 2009) is an unmanaged index of US Treasury obligations having maturities ranging from 1 to 2.99 years.

Net Asset Value and Distribution Information
	Class A	Class B	Class C	Class S	Institutional Class
Net Asset Value: 10/31/09	$ 9.23	$ 9.23	$ 9.22	$ 9.24	$ 9.24
10/31/08	$ 9.00	$ 9.00	$ 8.99	$ 9.00	$ 9.01
Distribution Information: Twelve Months as of 10/31/09: Income Dividends	$ .35	$ .28	$ .28	$ .37	$ .37
October Income Dividend	$ .0266	$ .0208	$ .0208	$ .0286	$ .0293
SEC 30-day Yield as of 10/31/09+++	2.78%	2.11%	2.11%	3.11%	3.19%
Current Annualized Distribution Rate as of 10/31/09+++	3.39%	2.65%	2.66%	3.64%	3.73%

⁺⁺⁺ The SEC yield is net investment income per share earned over the month ended October 31, 2009, shown as an annualized percentage of the maximum offering price per share on the last day of the period. The SEC yield is computed in accordance with a standardized method prescribed by the Securities and Exchange Commission. The SEC yields would have been 2.55%, 1.82%, 1.91%, 2.87% and 3.01% for Class A, B, C, S and Institutional Class shares, respectively, had certain expenses not been reduced. Current annualized distribution rate is the latest monthly dividend shown as an annualized percentage of net asset value on October 31, 2009. Distribution rate simply measures the level of dividends and is not a complete measure of performance. The current annualized distribution rates would have been 3.16%, 2.36%, 2.46%, 3.40% and 3.55% for Class A, B, C, S and Institutional Class shares, respectively, had certain expenses not been reduced. Yields and distribution rates are historical, not guaranteed, and will fluctuate.

Lipper Rankings — Short Investment Grade Debt Funds Category as of 10/31/09
Period	Rank		Number of Fund Classes Tracked	Percentile Ranking (%)
Class A 1-Year	176	of	258	68
3-Year	152	of	215	71
5-Year	118	of	177	67
Class B 1-Year	193	of	258	75
3-Year	168	of	215	78
5-Year	144	of	177	81
Class C 1-Year	191	of	258	74
3-Year	167	of	215	78
5-Year	143	of	177	81
Class S 1-Year	161	of	258	63
3-Year	144	of	215	67
Institutional Class 1-Year	165	of	258	64
3-Year	145	of	215	68
5-Year	110	of	177	62
10-Year	63	of	94	67

Source: Lipper Inc. Rankings are historical and do not guarantee future results. Rankings are based on total return unadjusted for sales charges with distributions reinvested. If sales charges had been included, rankings might have been less favorable.

Information About Your Fund's Expenses

As an investor of the Fund, you incur two types of costs: ongoing expenses and transaction costs. Ongoing expenses include management fees, distribution and service (12b-1) fees and other Fund expenses. Examples of transaction costs include sales charges (loads), redemption fees and account maintenance fees, which are not shown in this section. The following tables are intended to help you understand your ongoing expenses (in dollars) of investing in each Fund and to help you compare these expenses with the ongoing expenses of investing in other mutual funds. In the most recent six-month period, the Fund limited these expenses; had it not done so, expenses would have been higher. The example in the table is based on an investment of $1,000 invested at the beginning of the six-month period and held for the entire period (May 1, 2009 to October 31, 2009).

The tables illustrate your Fund's expenses in two ways:

• Actual Fund Return. This helps you estimate the actual dollar amount of ongoing expenses (but not transaction costs) paid on a $1,000 investment in the Fund using the Fund's actual return during the period. To estimate the expenses you paid over the period, simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the "Expenses Paid per $1,000" line under the share class you hold.

• Hypothetical 5% Fund Return. This helps you to compare your Fund's ongoing expenses (but not transaction costs) with those of other mutual funds using the Fund's actual expense ratio and a hypothetical rate of return of 5% per year before expenses. Examples using a 5% hypothetical fund return may be found in the shareholder reports of other mutual funds. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period.

Please note that the expenses shown in these tables are meant to highlight your ongoing expenses only and do not reflect any transaction costs. The "Expenses Paid per $1,000" line of the tables is useful in comparing ongoing expenses only and will not help you determine the relative total expense of owning different funds. An account maintenance fee of $6.25 per quarter for Class S shares may apply for certain accounts whose balances do not meet the applicable minimum initial investment. This fee is not included in these tables. If it was, the estimate of expenses paid for Class S shares during the period would be higher, and account value during the period would be lower, by this amount.

Expenses and Value of a $1,000 Investment for the six months ended October 31, 2009
Actual Fund Return	Class A	Class B	Class C	Class S	Institutional Class
Beginning Account Value 5/1/09	$ 1,000.00	$ 1,000.00	$ 1,000.00	$ 1,000.00	$ 1,000.00
Ending Account Value 10/31/09	$ 1,059.40	$ 1,055.40	$ 1,055.60	$ 1,061.90	$ 1,060.80
Expenses Paid per $1,000*	$ 3.69	$ 7.56	$ 7.56	$ 2.39	$ 2.34
Hypothetical 5% Fund Return	Class A	Class B	Class C	Class S	Institutional Class
Beginning Account Value 5/1/09	$ 1,000.00	$ 1,000.00	$ 1,000.00	$ 1,000.00	$ 1,000.00
Ending Account Value 10/31/09	$ 1,021.63	$ 1,017.85	$ 1,017.85	$ 1,022.89	$ 1,022.94
Expenses Paid per $1,000*	$ 3.62	$ 7.43	$ 7.43	$ 2.35	$ 2.29

* Expenses are equal to the Fund's annualized expense ratio for each share class, multiplied by the average account value over the period, multiplied by the number of days in the most recent six-month period, then divided by 365.

Annualized Expense Ratios	Class A	Class B	Class C	Class S	Institutional Class
DWS Short Duration Fund	.71%	1.46%	1.46%	.46%	.45%

For more information, please refer to the Fund's prospectus.

Portfolio Management Review

DWS Short Duration Fund: A Team Approach to Investing

Deutsche Investment Management Americas Inc. ("DIMA" or the "Advisor"), which is part of Deutsche Asset Management, is the investment advisor for the DWS Short Duration Fund. DIMA provides a full range of investment advisory services to institutional and retail clients.

Deutsche Asset Management is a global asset management organization that offers a wide range of investing expertise and resources. This well-resourced global investment platform brings together a wide variety of experience and investment insight across industries, regions, asset classes and investing styles.

DIMA is an indirect, wholly owned subsidiary of Deutsche Bank AG. Deutsche Bank AG is a major global banking institution that is engaged in a wide range of financial services, including investment management, mutual funds, retail, private and commercial banking, investment banking and insurance.

Portfolio Management Team

William Chepolis, CFA

Portfolio Manager

Matthew F. MacDonald, CFA

Portfolio Manager

Gary Sullivan, CFA

Portfolio Manager

Eric S. Meyer, CFA

Portfolio Manager

Overview of Market and Fund Performance

The views expressed in the following discussion reflect those of the portfolio management team only through the end of the period of the report as stated on the cover. The management team's views are subject to change at any time based on market and other conditions and should not be construed as a recommendation. Past performance is no guarantee of future results. Current and future portfolio holdings are subject to risk.

The fund produced a total return of 6.62% (Class A shares) for the 12 months ended October 31, 2009. The fund's benchmark, the Barclays Capital 1-3 Year Government/Credit Index, produced a total return of 6.31% for the same period.¹ Please note the fund changed its benchmark as of August 1, 2009. The previous benchmark was the BOA Merrill Lynch 1-3 Year US Treasury Index, which returned 2.73% for the period.² The average return for the Lipper Short Investment Grade Debt Funds category for the 12 months was 7.86%.³ (Returns are unadjusted for sales charges. If sales charges had been included, returns would have been lower. Past performance is no guarantee of future results. Please see pages 4 through 6 for the performance of other share classes and for more complete performance information.)

For much of the period, any research-based approach such as ours was overwhelmed by the extraordinary conditions that prevailed. The fund's focus on so-called "spread sectors" that offer higher yields than US government securities was the principal factor in our performance over the 12 months.⁴

As the period began, sentiment in the credit markets continued to deteriorate in the wake of the September 2008 turmoil among leading global financial institutions. The highlight was leading investment bank Lehman Brothers falling victim to a liquidity crisis. However, what sent the credit sectors into free fall was the two remaining giant investment banks, Goldman Sachs and Morgan Stanley, converting to bank holding companies in order to qualify for government liquidity support. Both firms were required to reduce their leverage at the same time as Lehman holdings were being liquidated, which was accomplished by a wave of fixed-income selling beginning in October of 2008. As a consequence, the fourth quarter of 2008 saw sharp declines in even high-quality non-government sectors, as investors placed a tremendous premium on safety.

Investor risk appetites began to return over the first quarter of 2009, as the extensive government actions to support the financial sector gained traction with market participants. As a result, sectors that trade at a yield spread over Treasuries have generally performed well over the first 10 months of 2009.⁵ In a reversal of trends, corporate bonds, especially high-yield issues and leveraged bank loans, outperformed Treasuries.⁶ Among other credit-oriented sectors, asset-backed securities in particular rose sharply.⁷

During the year, the US Federal Reserve Board (the Fed) did everything it could to bring rates down and keep them there, including lowering the federal funds rate to the unprecedented 0% to 0.25% range.⁸ Yields on Treasuries finished lower along the length of the curve. To illustrate, the two-year Treasury yield fell by 66 basis points, from 1.56% to 0.90%; the five-year by 49 basis points, from 2.80% to 2.31%, and the 10-year fell 60 basis points, from 4.01% to 3.41% (100 basis points equals one percentage point).

US Treasury Yield Curve (as of 10/31/08 and 10/31/09)

Source: Bloomberg

Chart is for illustrative purposes only and does not represent any DWS Investments product.

Past performance is no guarantee of future results.  

Positive Contributors to Performance

As investor risk appetites returned in 2009, the fund's largest position, in short-term corporate issues, outperformed comparable Treasuries significantly. Within the corporate segment, financial issues rebounded especially strongly as massive government liquidity programs helped stabilize the sector. In adding to the fund's corporate exposure, we took advantage of attractive new issue concessions to add income generation to the fund.

The fund's significant positions in commercial mortgage-backed securities (CMBS) and asset-backed securities rebounded sharply and have outperformed Treasuries by wide margins in 2009.⁹

Early in 2009, we purchased bank issuances guaranteed by the government as part of efforts to improve financial sector stability and liquidity. These issues are higher quality than government agency issues, as they are backed by the Federal Deposit Insurance Corporation (FDIC), but they offered above-agency yields. This position worked well for the fund as prices rose and yield spreads narrowed on these issues.

Negative Contributors to Performance

Although it would have been difficult to anticipate the rush to the exits occasioned by the delevering of Morgan Stanley and Goldman Sachs, in retrospect we could have had a lighter credit exposure going into the beginning of the fiscal period. Market participants fearing contagion drove a wave of risk reduction that extended through November of 2008, pummeling spread sectors. Even very high quality non-Treasury sectors were penalized as investors seeking liquidity found them the easiest to sell. We had significant exposure to asset-backed securities and commercial mortgage-backed securities with heavy protection against defaults that nonetheless experienced unprecedented declines, leading to most of the fund's underperformance versus the peer group over the full period.

Outlook and Positioning

As of October 31, 2009, the bulk of the portfolio was allocated as follows: 46% to investment-grade corporate bonds, 23% to government-backed securities, 11% to residential mortgage-backed securities (MBS), 11% to commercial mortgage-backed securities, and 6% to asset-backed securities. The fund's overall quality profile remained high, with the average credit quality of investments in the fund at AA as of the end of the period.¹⁰ At period end, the fund's overall duration was 2.03 years versus 1.86 years for the Barclays Capital 1-3 Year Government/Credit Index.¹¹

While the severe liquidity issues and grave concern over the financial sector appear to have abated in recent months, we view the outlook for the economy as lukewarm given continued anemic housing and employment numbers.

Within the corporate segment, we are not chasing yield given the less generous pricing and tighter spreads following the recent rally, but have been adding exposure to high-quality issues. We have also been adding to government-backed issues. Valuations appear reasonably full in the mortgage-backed sector and we are allowing that exposure to gradually diminish with prepayments.

We currently expect the Fed to remain on hold for the near-to-intermediate term, as it has signaled, and we will be focusing strongly on credit analysis. Given the economic backdrop, we remain comfortable with our focus on high-quality credits.

¹ The Barclays Capital 1-3 Year Government/Credit Index is an unmanaged index consisting of all US government agency and Treasury securities, as well as all investment-grade corporate debt securities with maturities of one to three years. On August 1, 2009, the Barclays Capital 1-3 Year Government/Credit Index replaced the Merrill Lynch 1-3 Year US Treasury Index as the fund's benchmark index because the advisor believes that it more accurately reflects the fund's investment strategy.

² BOA Merrill Lynch 1-3 Year US Treasury Index (name changed from Merrill Lynch 1-3 Year US Treasury Index effective September 25, 2009) is an unmanaged index of US Treasury obligations having maturities ranging from 1 to 2.99 years.

Index returns, unlike fund returns, do not reflect any fees or expenses. It is not possible to invest directly into an index.

³ The Lipper Short Investment Grade Debt Funds category includes funds that invest at least 65% of their assets in investment-grade debt issues (rated in the top four grades) with dollar-weighted average maturities of less than three years. Lipper figures represent the average of the total returns reported by all of the mutual funds designated by Lipper Inc. as falling into the Lipper Short Investment Grade Debt Funds category. For the 1- and 5-year periods, this category's average was 7.86% (258 funds) and 2.65% (177 funds), respectively, as of 10/31/09. It is not possible to invest directly into a category or any index.

⁴ Spread sectors are non-Treasury bond sectors of the fixed-income market.

⁵ "Spread" refers to the excess yield various bond sectors offer over Treasuries with similar maturities. When spreads widen, yield differences are increasing between bonds in the two sectors being compared. When spreads narrow, the opposite is true.

⁶ Leveraged loans are loans extended to companies or individuals that already have considerable amounts of debt. This type of loan generally carries a higher risk of default and, as a result, is more costly to the borrower.

⁷ Asset-backed securities (ABS) are secured by assets.

⁸ The federal funds rate is the interest rate, set by the US Federal Reserve Board, at which banks lend money to each other, usually on an overnight basis. The yield curve is a graphical representation of how yields on bonds of different maturities compare. Normally, yield curves slant up, as bonds with longer maturities typically offer higher yields than short-term bonds.

⁹ Mortgage-backed securities (MBS) are bonds that are secured by mortgage debt. Commercial mortgage-backed securities (CMBS) are secured by loans on a commercial property.

¹⁰ Credit quality is a measure of a bond issuer's ability to repay interest and principal in a timely manner. Rating agencies assign letter designations such as AAA, AA and so forth. The lower the rating, the higher the probability of default.

¹¹ Duration is a measure of bond price volatility. Duration can be defined as the approximate percentage change in price for a 100-basis-point (one single percentage point) change in market interest rate levels. A duration of 1.25, for example, means that the price of a bond or bond portfolio should rise by approximately 1.25% for a one-percentage-point drop in interest rates, and that it should fall by 1.25% for a one-percentage-point rise in interest rates.

Portfolio Summary

Asset Allocation (As a % of Investment Portfolio excluding Securities Lending Collateral)	10/31/09	10/31/08
Corporate Bonds	46%	12%
Government & Agency Obligations	23%	15%
Commercial Mortgage-Backed Securities	11%	8%
Collateralized Mortgage Obligations	7%	32%
Asset Backed	6%	28%
Mortgage-Backed Securities Pass-Throughs	4%	2%
Cash Equivalents	2%	1%
Municipal Bonds and Notes	1%	1%
Preferred Securities	—	1%
	100%	100%

Quality (Excludes Securities Lending Collateral)	10/31/09	10/31/08
US Government and Agencies	17%	23%
AAA*	25%	56%
AA	13%	9%
A	18%	3%
BBB	22%	9%
Below BBB	5%	—
	100%	100%

^* Includes cash equivalents

Effective Maturity	10/31/09	10/31/08
Under 1 year	23%	19%
1-2.99 years	42%	69%
3-4.99 years	27%	10%
5-9.99 years	7%	2%
Greater than 10 years	1%	—
	100%	100%

Weighted average effective maturity: 2.4 years and 1.9 years, respectively.

Asset allocation, quality and effective maturity are subject to change.

The quality ratings represent the lower of Moody's Investors Service, Inc. ("Moody's") or Standard & Poor's Corporation ("S&P") credit ratings. The ratings of Moody's and S&P represent their opinions as to the quality of the securities they rate. Ratings are relative and subjective and are not absolute standards of quality. The Fund's credit quality does not remove market risk.

For more complete details about the Fund's investment portfolio, see page 14. A quarterly Fact Sheet is available upon request. A complete list of the Fund's portfolio holdings is posted as of the month end on www.dws-investments.com on or about the 15th day of the following month. More frequent posting of portfolio holdings information may be made from time to time on www.dws-investments.com. Please see the Account Management Resources section for contact information.

Following the Fund's fiscal first and third quarter-end, a complete portfolio holdings listing is filed with the SEC on Form N-Q. This form will be available on the SEC's Web site at www.sec.gov, and it also may be reviewed and copied at the SEC's Public Reference Room in Washington, D.C. Information on the operation of the SEC's Public Reference Room may be obtained by calling (800) SEC-0330.

Investment Portfolio as of October 31, 2009

	Principal Amount ($)	Value ($)
Corporate Bonds 46.6%
Consumer Discretionary 2.5%
AutoZone, Inc., 5.75%, 1/15/2015	540,000	578,318
DirecTV Holdings LLC, 144A, 4.75%, 10/1/2014	270,000	275,446
Fortune Brands, Inc., 6.375%, 6/15/2014	675,000	717,341
JC Penney Corp., Inc., 9.0%, 8/1/2012	500,000	545,000
Macy's Retail Holdings, Inc., 6.625%, 4/1/2011	600,000	609,000
Time Warner Cable, Inc., 5.4%, 7/2/2012	550,000	587,425
Viacom, Inc., 4.375%, 9/15/2014	350,000	359,019
Wyndham Worldwide Corp., 9.875%, 5/1/2014	396,000	435,723
		4,107,272
Consumer Staples 2.6%
Altria Group, Inc., 7.125%, 6/22/2010	380,000	392,750
Anheuser-Busch InBev Worldwide, Inc.:
144A, 3.0%, 10/15/2012	190,000	191,645
144A, 5.375%, 11/15/2014	770,000	818,700
Campbell Soup Co., 3.375%, 8/15/2014	740,000	764,235
CVS Caremark Corp., 0.661%*, 6/1/2010	500,000	499,876
H.J. Heinz Co., 5.35%, 7/15/2013	700,000	756,071
PepsiAmericas, Inc., 4.375%, 2/15/2014	210,000	220,313
Procter & Gamble Co., 4.6%, 1/15/2014	600,000	644,707
		4,288,297
Energy 3.5%
Anadarko Petroleum Corp.:
5.75%, 6/15/2014	70,000	75,294
7.625%, 3/15/2014	500,000	572,099
Canadian Natural Resources Ltd., 5.15%, 2/1/2013	620,000	657,132
Cenovus Energy, Inc., 144A, 4.5%, 9/15/2014	300,000	308,039
Chevron Corp., 3.45%, 3/3/2012	800,000	839,392
Devon Energy Corp., 5.625%, 1/15/2014	400,000	434,354
Enterprise Products Operating LLC:
4.6%, 8/1/2012	480,000	499,874
Series M, 5.65%, 4/1/2013	100,000	106,122
Series B, 7.5%, 2/1/2011	80,000	85,017
Hess Corp., 7.0%, 2/15/2014	230,000	258,903
Husky Energy, Inc., 5.9%, 6/15/2014	340,000	369,356
Kinder Morgan Energy Partners LP, 5.625%, 2/15/2015	300,000	321,898
Marathon Oil Corp., 6.5%, 2/15/2014	340,000	378,198
Plains All American Pipeline LP, 4.25%, 9/1/2012	400,000	411,015
Statoil ASA, 2.9%, 10/15/2014	380,000	383,160
		5,699,853
Financials 23.2%
American Express Bank, FSB, 5.55%, 10/17/2012	650,000	693,872
American Express Credit Corp., Series D, 5.125%, 8/25/2014	540,000	568,892
American General Finance Corp., Series H, 4.625%, 9/1/2010	625,000	581,860
American Honda Finance Corp., 144A, 0.511%*, 5/11/2010	760,000	757,392
Anglo American Capital PLC, 144A, 9.375%, 4/8/2014	520,000	607,330
Bank of New York Mellon Corp., Series G, 4.95%, 11/1/2012	800,000	866,688
Barclays Bank PLC, 5.2%, 7/10/2014	380,000	405,203
BB&T Corp., 6.5%, 8/1/2011	1,000,000	1,067,946
Berkshire Hathaway Finance Corp., 4.0%, 4/15/2012	500,000	526,346
Capital One Financial Corp., 7.375%, 5/23/2014	540,000	612,891
Caterpillar Financial Services Corp., Series F, 4.85%, 12/7/2012	500,000	532,905
Citigroup, Inc., 6.375%, 8/12/2014	1,000,000	1,060,874
CME Group, Inc., 5.75%, 2/15/2014	445,000	488,098
Commonwealth Bank of Australia, 144A, 3.75%, 10/15/2014	520,000	525,167
Countrywide Financial Corp., 5.8%, 6/7/2012	1,000,000	1,063,873
Credit Suisse New York, 5.5%, 5/1/2014	820,000	889,206
Daimler Finance North America LLC, 6.5%, 11/15/2013	800,000	870,962
Deutsche Telekom International Finance BV, 4.875%, 7/8/2014	770,000	812,255
Discover Financial Services, 0.83%*, 6/11/2010	960,000	948,468
Duke Realty LP, (REIT), 7.375%, 2/15/2015	140,000	147,535
Encana Holdings Finance Corp., 5.8%, 5/1/2014	520,000	567,077
General Electric Capital Corp.:
3.5%, 8/13/2012	475,000	488,183
5.9%, 5/13/2014	770,000	842,725
Hospitality Properties Trust, (REIT), 7.875%, 8/15/2014	520,000	534,788
HSBC Finance Corp., 5.25%, 1/15/2014	800,000	838,485
Hyundai Capital Services, Inc., 144A, 6.0%, 5/5/2015 (a)	250,000	250,228
Iberdrola Finance Ireland Ltd., 144A, 3.8%, 9/11/2014	320,000	322,972
JPMorgan Chase & Co., 4.65%, 6/1/2014	800,000	843,899
Lukoil International Finance BV, 144A, 6.375%, 11/5/2014 (a)	880,000	881,742
Macquarie Group Ltd., 144A, 7.3%, 8/1/2014	650,000	705,531
Merrill Lynch & Co., Inc., 5.77%, 7/25/2011	960,000	1,012,149
Morgan Stanley:
Series F, 5.625%, 1/9/2012	750,000	798,610
6.0%, 5/13/2014	320,000	343,508
National Rural Utilities Cooperative Finance Corp., 2.625%, 9/16/2012	1,000,000	1,008,674
New York Life Global Funding, 144A, 2.25%, 12/14/2012	300,000	299,729
Northern Trust Corp., 4.625%, 5/1/2014	230,000	246,846
Novartis Capital Corp., 4.125%, 2/10/2014	525,000	554,529
PC Financial Partnership, 5.0%, 11/15/2014	800,000	837,639
Pricoa Global Funding I, 144A, 5.45%, 6/11/2014	445,000	469,066
Principal Financial Group, Inc., 7.875%, 5/15/2014	770,000	863,528
Prudential Financial, Inc.:
Series D, 3.625%, 9/17/2012	230,000	233,744
6.2%, 1/15/2015	230,000	245,272
Rabobank Nederland - Cooperatieve Centrale Raiffeisen-Boerenleenbank BA, 144A, 4.2%, 5/13/2014	770,000	802,885
Rio Tinto Finance (USA) Ltd.:
5.875%, 7/15/2013	300,000	323,314
8.95%, 5/1/2014	570,000	673,667
Royal Bank of Scotland PLC, 144A, 4.875%, 8/25/2014	870,000	885,454
Shell International Finance BV, 1.3%, 9/22/2011	600,000	603,225
Simon Property Group LP, (REIT):
4.6%, 6/15/2010	200,000	202,019
5.375%, 6/1/2011	400,000	418,154
Sovereign Bancorp., Inc., 4.8%, 9/1/2010	500,000	514,301
Svenska Handelsbanken AB, 144A, 2.875%, 9/14/2012	800,000	804,034
Swiss Re Solutions Holding Corp., 7.5%, 6/15/2010	780,000	805,732
Telecom Italia Capital SA:
5.25%, 11/15/2013	400,000	420,885
6.175%, 6/18/2014	510,000	553,249
The Goldman Sachs Group, Inc.:
3.625%, 8/1/2012	280,000	288,486
6.0%, 5/1/2014	700,000	769,555
Tyco International Finance SA, 4.125%, 10/15/2014	160,000	163,489
Verizon Wireless Capital LLC:
144A, 3.75%, 5/20/2011	380,000	392,820
144A, 5.25%, 2/1/2012	750,000	801,426
Wachovia Bank NA, 7.8%, 8/18/2010	850,000	892,397
Wells Fargo & Co., Series I, 3.75%, 10/1/2014	320,000	319,895
Woori Bank, 144A, 7.0%, 2/2/2015	285,000	307,725
		38,159,399
Health Care 3.3%
CareFusion Corp., 144A, 4.125%, 8/1/2012	110,000	113,019
Eli Lilly & Co., 3.55%, 3/6/2012	530,000	554,917
Express Scripts, Inc.:
5.25%, 6/15/2012	380,000	404,802
6.25%, 6/15/2014	150,000	164,811
McKesson Corp., 6.5%, 2/15/2014	185,000	203,474
Medtronic, Inc., 4.5%, 3/15/2014	445,000	476,048
Merck & Co., Inc., 1.875%, 6/30/2011	590,000	597,458
Pfizer, Inc., 4.45%, 3/15/2012	800,000	848,321
Roche Holdings, Inc., 144A, 4.5%, 3/1/2012	965,000	1,020,543
Watson Pharmaceuticals, Inc., 5.0%, 8/15/2014	390,000	400,139
Wyeth, 5.5%, 2/1/2014	620,000	679,460
		5,462,992
Industrials 2.0%
3M Co., 4.65%, 12/15/2012	540,000	585,310
BAE Systems Holdings, Inc., 144A, 4.95%, 6/1/2014	385,000	399,490
Burlington Northern Santa Fe Corp., 7.0%, 2/1/2014	1,250,000	1,427,860
Ingersoll-Rand Global Holding Co., Ltd., 9.5%, 4/15/2014	190,000	227,981
Textron, Inc., 6.2%, 3/15/2015	380,000	387,495
United Parcel Service, Inc., 4.5%, 1/15/2013	290,000	310,804
		3,338,940
Information Technology 2.1%
Cisco Systems, Inc., 5.25%, 2/22/2011	850,000	896,213
Hewlett-Packard Co.:
2.25%, 5/27/2011	240,000	244,675
2.95%, 8/15/2012	130,000	133,397
4.25%, 2/24/2012	1,000,000	1,056,112
Oracle Corp., 3.75%, 7/8/2014	500,000	519,784
Xerox Corp., 7.125%, 6/15/2010	650,000	669,388
		3,519,569
Materials 1.3%
Bemis Co., Inc., 5.65%, 8/1/2014	160,000	169,727
Dow Chemical Co.:
4.85%, 8/15/2012	250,000	260,276
5.9%, 2/15/2015	630,000	651,733
Freeport-McMoRan Copper & Gold, Inc., 3.881%*, 4/1/2015	469,000	474,169
Potash Corp. of Saskatchewan, Inc., 5.25%, 5/15/2014	480,000	520,786
		2,076,691
Telecommunication Services 2.1%
American Tower Corp., 144A, 4.625%, 4/1/2015	350,000	354,153
British Telecommunications PLC, 9.125%, 12/15/2010	1,000,000	1,076,890
Centennial Cellular Operating Co., 10.125%, 6/15/2013	265,000	273,613
France Telecom SA, 4.375%, 7/8/2014	900,000	950,017
Qwest Corp.:
7.5%, 10/1/2014	473,000	477,730
7.875%, 9/1/2011	250,000	258,125
		3,390,528
Utilities 4.0%
Ameren Corp., 8.875%, 5/15/2014 (b)	202,000	226,526
Consolidated Edison Co. of New York, 5.55%, 4/1/2014	780,000	853,473
Consumers Energy Co.:
Series F, 4.0%, 5/15/2010	800,000	812,503
Series J, 6.0%, 2/15/2014	730,000	803,781
DTE Energy Co., 7.625%, 5/15/2014	290,000	320,034
Duke Energy Corp., 6.3%, 2/1/2014	540,000	597,089
FirstEnergy Solutions Corp., 144A, 4.8%, 2/15/2015	410,000	420,170
Florida Power Corp., 4.8%, 3/1/2013	900,000	957,060
MidAmerican Energy Holdings Co., 3.15%, 7/15/2012	900,000	918,454
Niagara Mohawk Power Corp., 144A, 3.553%, 10/1/2014	190,000	191,223
Oncor Electric Delivery Co., 6.375%, 5/1/2012	380,000	412,858
		6,513,171
Total Corporate Bonds (Cost $72,794,383)		76,556,712
Mortgage-Backed Securities Pass-Throughs 4.3%
Federal Home Loan Mortgage Corp.:
5.5%, 3/1/2010	73,174	73,725
7.0%, 3/1/2013	20,513	21,348
Federal National Mortgage Association:
4.5%, 4/1/2023	804,834	838,914
5.315%*, 9/1/2038	1,172,806	1,245,759
6.0%, 11/1/2017	1,564,426	1,679,680
7.0%, 4/1/2038	544,866	595,011
Government National Mortgage Association:
6.5%, with various maturities from 8/20/2034 until 2/20/2039	2,336,425	2,501,541
7.0%, with various maturities from 6/20/2038 until 10/20/2038	139,529	150,811
Total Mortgage-Backed Securities Pass-Throughs (Cost $6,912,044)		7,106,789
Asset-Backed 5.9%
Automobile Receivables 2.7%
AmeriCredit Automobile Receivables Trust:
"A4", Series 2004-DF, 3.43%, 7/6/2011	95,451	96,286
"A2", Series 2006-RM, 5.42%, 8/8/2011	399,757	406,755
"A3A", Series 2007-DF, 5.49%, 7/6/2012	285,778	290,627
Capital One Prime Auto Receivables Trust, "A3", Series 2007-1, 5.47%, 6/15/2011	233,018	234,778
Credit Acceptance Auto Dealer Loan Trust, "A1A", Series 2007-2, 144A, 6.16%, 4/15/2013	218,761	218,443
Daimler Chrysler Auto Trust, "A2A", Series 2008-B, 3.81%, 7/8/2011	517,486	522,052
Ford Credit Auto Owner Trust, "A2", Series 2009-B, 2.1%, 11/15/2011	192,000	193,544
Hyundai Auto Receivables Trust:
"A3A", Series 2007-A, 5.04%, 1/17/2012	863,988	882,249
"D", Series 2006-A, 5.52%, 11/15/2012	51,303	51,555
Long Beach Auto Receivables Trust, "A3", Series 2006-B, 5.17%, 8/15/2011	55,575	55,672
WFS Financial Owner Trust, "D", Series 2005-3, 4.76%, 5/17/2013	710,000	716,768
World Omni Auto Receivables Trust, "A3A", Series 2007-B, 5.28%, 1/17/2012	817,190	833,253
		4,501,982
Credit Card Receivables 0.5%
Capital One Multi-Asset Execution Trust, "A2", Series 2009-A2, 3.2%, 4/15/2014	770,000	792,856
Home Equity Loans 1.8%
Carrington Mortgage Loan Trust, "A1", Series 2006-NC4, 0.294%*, 10/25/2036	183,604	178,698
Citifinancial Mortgage Securities, Inc., "AF2", Series 2004-1, 2.645%, 4/25/2034	47,688	47,315
Credit-Based Asset Servicing and Securitization LLC:
"A4", Series 2004-CB4, 5.497%, 5/25/2035	27,374	26,939
"A2A", Series 2007-CB2, 5.752%*, 2/25/2037	372,148	312,572
First Franklin Mortgage Loan Asset-Backed Certificates, "A2A", Series 2007-FFC, 0.394%*, 6/25/2027	545,179	224,072
Household Home Equity Loan Trust:
"A2F", Series 2006-4, 5.32%, 3/20/2036	590,000	575,012
"A1F", Series 2006-4, 5.79%, 3/20/2036	18,790	18,725
"A1F", Series 2006-3, 5.98%, 3/20/2036	13,926	13,884
JPMorgan Mortgage Acquisition Corp., "AF1B", Series 2007-CH1, 5.935%, 10/25/2036	307,089	303,099
Renaissance Home Equity Loan Trust:
"AF3", Series 2005-2, 4.499%, 8/25/2035	410,411	401,738
"AF1", Series 2006-4, 5.545%, 1/25/2037	117,254	116,274
"AF2", Series 2006-3, 5.58%, 11/25/2036	419,742	368,218
"AF1", Series 2007-2, 5.893%, 6/25/2037	418,137	380,716
Southern Pacific Secured Assets Corp., "A8", Series 1998-2, 6.37%, 7/25/2029	45,345	34,784
		3,002,046
Miscellaneous 0.9%
Babson CLO Ltd., "A", Series 2005-3A, 144A, 0.714%*, 11/10/2019	580,275	509,191
Caterpillar Financial Asset Trust, "A2A", Series 2008-A, 4.09%, 12/27/2010	406,447	407,781
Duane Street CLO, "A", Series 2005-1A, 144A, 0.714%*, 11/8/2017	638,090	534,401
		1,451,373
Total Asset-Backed (Cost $10,142,235)		9,748,257
Commercial Mortgage-Backed Securities 10.9%
Banc of America Commercial Mortgage, Inc., "A1", Series 2005-4, 4.432%, 7/10/2045	189,889	190,601
Bear Stearns Commercial Mortgage Securities, Inc.:
"A1", Series 2002-PBW1, 3.97%, 11/11/2035	139,102	140,749
"A1", Series 2002-TOP8, 4.06%, 8/15/2038	351,009	357,301
"A2", Series 2001-TOP2, 6.48%, 2/15/2035	750,000	776,113
CS First Boston Mortgage Securities Corp.:
"A3", Series 2002-CKN2, 6.133%, 4/15/2037	925,000	972,663
"A4", Series 2001-CP4, 6.18%, 12/15/2035	658,425	687,391
"F", Series 2001-CK1, 144A, 6.65%, 12/18/2035	1,300,000	1,290,665
GMAC Commercial Mortgage Securities, Inc., "A2", Series 2001-C1, 6.465%, 4/15/2034	562,260	581,965
Greenwich Capital Commercial Funding Corp.:
"A2", Series 2005-GG5, 5.117%, 4/10/2037	1,000,000	999,685
"A2", Series 2007-GG9, 5.381%, 3/10/2039	1,433,000	1,454,811
JPMorgan Chase Commercial Mortgage Securities Corp.:
"A2", Series 2004-CB8, 3.837%, 1/12/2039	579,449	579,678
"A2", Series 2004-PNC1, 4.555%, 6/12/2041	97,956	98,496
"A2", Series 2005-LDP1, 4.625%, 3/15/2046	254,465	254,570
"A2", Series 2002-C1, 4.914%, 7/12/2037	448,798	458,411
LB-UBS Commercial Mortgage Trust:
"A2", Series 2003-C7, 4.064%, 9/15/2027	1,347,627	1,355,203
"A3", Series 2002-C4, 4.071%, 9/15/2026	296,686	303,593
"A3", Series 2001-C7, 5.642%, 12/15/2025	519,930	534,976
Morgan Stanley Capital I:
"A2", Series 2005-HQ5, 4.809%, 1/14/2042	1,314,135	1,317,451
"A2", Series 2007-HQ11, 5.359%, 2/12/2044	900,000	907,093
Morgan Stanley Dean Witter Capital I, "A4", Series 2001-TOP1, 6.66%, 2/15/2033	405,114	418,224
Prudential Securities Secured Financing Corp., "F", Series 1999-C2, 7.525%*, 6/16/2031	1,500,000	1,501,403
Wachovia Bank Commercial Mortgage Trust:
"A2", Series 2005-C17, 4.782%, 3/15/2042	1,240,588	1,242,363
"A1", Series 2007-C30, 5.031%, 12/15/2043	1,472,553	1,502,744
Total Commercial Mortgage-Backed Securities (Cost $17,291,718)		17,926,149
Collateralized Mortgage Obligations 7.1%
Banc of America Mortgage Securities:
"2A2", Series 2003-1, 5.25%, 2/25/2018	62,996	62,942
"1A1O", Series 2005-4, 5.25%, 5/25/2035	163,168	161,891
Cendant Mortgage Corp., "A5", Series 2003-1, 5.5%, 2/25/2033	71,278	71,299
Citicorp Mortgage Securities, Inc.:
"1A1", Series 2005-7, 5.5%, 10/25/2035	432,380	399,511
"1A2", Series 2006-5, 6.0%, 10/25/2036	288,494	270,371
Countrywide Alternative Loan Trust:
"2A1", Series 2004-28CB, 5.0%, 1/25/2035	80,525	75,864
"3A3", Series 2005-20CB, 5.5%, 7/25/2035	264,085	236,946
"A4", Series 2002-11, 6.25%, 10/25/2032	46,773	45,824
Countrywide Home Loan Mortgage Pass-Through Trust:
"A15", Series 2002-34, 4.75%, 1/25/2033	159,097	155,176
"2A17", Series 2004-13, 5.75%, 8/25/2034	209,515	209,089
Countrywide Home Loans:
"3A6", Series 2003-56, 4.49%, 12/25/2033	59,529	58,984
"5A1", Series 2005-HY10, 5.535%*, 2/20/2036	610,407	382,965
Deutsche Mortgage Securities, Inc., "1A1", Series 2005-WF1, 144A, 5.148%*, 6/26/2035	107,905	106,662
Federal Home Loan Mortgage Corp.:
"ND", Series 2715, 4.5%, 3/15/2016	1,108,861	1,126,209
"WJ", Series 2557, 5.0%, 7/15/2014	9,123	9,110
"QA", Series 3113, 5.0%, 11/15/2025	422,136	431,877
"HL", Series 3176, 5.0%, 2/15/2028	1,407,704	1,435,778
"QP", Series 3149, 5.0%, 10/15/2031	500,000	517,863
"DC", Series 2541, 5.05%, 3/15/2031	279,358	284,763
"AB", Series 3197, 5.5%, 8/15/2013	497,535	510,804
"PA", Series 3283, 5.5%, 7/15/2036	1,094,107	1,148,015
"LA", Series 1343, 8.0%, 8/15/2022	188,612	212,346
"PK", Series 1751, 8.0%, 9/15/2024	568,227	641,714
Federal National Mortgage Association:
"QK", Series 2003-37, 4.0%, 7/25/2027	107,897	107,617
"BX", Series 2005-77, 4.5%, 7/25/2028	929,390	941,961
MLCC Mortgage Investors, Inc., "1A", Series 2004-1, 4.33%*, 12/25/2034	168,114	163,477
Provident Funding Mortgage Loan Trust, "2A1", Series 2005-1, 4.332%*, 5/25/2035	431,891	421,696
Residential Accredit Loans, Inc., "A6", Series 2002-QS19, 5.125%, 12/25/2032	411,783	393,203
Residential Asset Mortgage Products, Inc., "A4", Series 2004-SL4, 7.0%, 7/25/2032	537,737	489,845
Residential Asset Securitization Trust, "2A1", Series 2003-A15, 5.25%, 2/25/2034	44,368	43,766
Structured Asset Securities Corp., "2A16", Series 2005-6, 5.5%, 5/25/2035	307,177	273,549
Wells Fargo Mortgage-Backed Securities Trust, "1A1", Series 2005-9, 4.75%, 10/25/2035	342,201	327,516
Total Collateralized Mortgage Obligations (Cost $11,892,061)		11,718,633
Government & Agency Obligations 22.7%
Other Government Related (c) 11.2%
Achmea Hypotheekbank NV:
144A, 0.631%*, 11/3/2014 (a)	310,000	309,543
144A, 3.2%, 11/3/2014 (a)	315,000	316,607
African Development Bank, 1.75%, 10/1/2012	495,000	496,119
Asian Development Bank, 2.75%, 5/21/2014	368,000	372,419
Barclays Bank PLC:
1.095%*, 3/16/2012	400,000	406,348
144A, 2.7%, 3/5/2012	890,000	913,365
Citibank NA, FDIC Guaranteed, 1.25%, 11/15/2011	690,000	690,345
Commonwealth Bank of Australia, 1.071%*, 7/27/2012	400,000	406,776
Dexia Credit Local, 144A, 0.939%*, 9/23/2011	970,000	978,929
European Bank for Reconstruction & Development:
1.25%, 6/10/2011	770,000	773,028
3.625%, 6/17/2013	620,000	652,104
FIH Erhvervsbank AS, 144A, 2.45%, 8/17/2012	500,000	507,013
GMAC, Inc., FDIC Guaranteed, 1.75%, 10/30/2012	400,000	400,693
HSBC USA, Inc., FDIC Guaranteed, 3.125%, 12/16/2011	100,000	104,217
Inter-American Development Bank:
1.5%, 6/23/2011	760,000	766,640
1.75%, 10/22/2012	500,000	500,327
International Finance Facility for Immunisation Co., Series 1, REG S, 5.0%, 11/14/2011	800,000	854,735
KeyBank NA, FDIC Guaranteed, 3.2%, 6/15/2012	100,000	104,530
Korea Electric Power Corp., 144A, 5.5%, 7/21/2014	720,000	759,950
Korea Gas Corp., 144A, 6.0%, 7/15/2014	122,000	129,190
Korea National Oil Corp., 144A, 5.375%, 7/30/2014	282,000	291,930
Kreditanstalt fuer Wiederaufbau, 2.75%, 10/21/2014	600,000	601,132
Macquarie Bank Ltd., Series B, 144A, 2.6%, 1/20/2012	330,000	339,310
National Agricultural Cooperative Federation, 144A, 5.0%, 9/30/2014	202,000	205,601
National Australia Bank Ltd., 144A, 2.55%, 1/13/2012	780,000	796,888
Nationwide Building Society, 144A, 2.5%, 8/17/2012	470,000	477,226
Nordic Investment Bank, 2.625%, 10/6/2014	620,000	618,828
Petroleos Mexicanos, 144A, 4.875%, 3/15/2015	540,000	531,954
Private Export Funding Corp., 3.05%, 10/15/2014	410,000	411,443
Societe Financement de l'Economie Francaise, 144A, 2.875%, 9/22/2014	625,000	631,131
Sovereign Bank, FDIC Guaranteed, 2.75%, 1/17/2012	680,000	701,416
Suncorp-Metway Ltd., 144A, 0.668%*, 12/17/2010	300,000	300,757
Svensk Exportkredit AB, 3.25%, 9/16/2014	500,000	505,632
US Central Federal Credit Union, 1.9%, 10/19/2012	290,000	290,464
Western Corporate Federal Credit Union, 1.75%, 11/2/2012 (a)	500,000	499,420
Westpac Banking Corp., 144A, 2.9%, 9/10/2014	350,000	350,008
Westpac Securities NZ Ltd., 144A, 2.5%, 5/25/2012	395,000	401,980
		18,397,998
Sovereign Bonds 3.9%
Export Development Canada, 2.375%, 3/19/2012	550,000	563,376
Federal Republic of Germany, 144A, 1.5%, 9/21/2012	720,000	717,350
Instituto de Credito Oficial, Series 192, 4.625%, 10/26/2010	380,000	393,313
Japan Finance Corp.:
2.0%, 6/24/2011	382,000	387,967
2.125%, 11/5/2012 (a)	840,000	842,579
Kingdom of Belgium, 144A, 2.875%, 9/15/2014	480,000	481,555
Kingdom of Spain, 144A, 2.0%, 9/17/2012	1,000,000	1,001,914
Korea Expressway Corp., 144A, 4.5%, 3/23/2015	340,000	339,358
Province of Ontario, Canada, 4.1%, 6/16/2014	290,000	306,613
Republic of Austria, 144A, 2.0%, 11/15/2012	590,000	583,363
Republic of Italy, 2.125%, 10/5/2012	500,000	502,185
Republic of Lithuania, 144A, 6.75%, 1/15/2015	270,000	271,616
		6,391,189
US Government Sponsored Agencies 3.6%
Federal Farm Credit Bank, 1.875%, 12/7/2012	900,000	903,974
Federal Home Loan Bank:
1.75%, 8/22/2012	360,000	362,389
1.875%, 6/20/2012	300,000	303,643
2.3%*, 9/10/2019	800,000	795,040
7.5%*, 11/12/2024 (a)	500,000	497,500
Federal Home Loan Mortgage Corp.:
1.125%, 12/15/2011	1,000,000	998,643
8.125%*, 8/20/2024	500,000	495,550
Federal National Mortgage Association:
1.0%, 11/23/2011	715,000	714,726
2.625%, 11/20/2014	620,000	619,604
8.45%*, 2/27/2023	200,000	200,000
		5,891,069
US Treasury Obligations 4.0%
US Treasury Bill, 0.19%**, 3/18/2010 (d)	285,000	284,887
US Treasury Notes:
0.875%, 12/31/2010 (b)	6,250,000	6,279,300
2.25%, 5/31/2014	92,000	92,395
		6,656,582
Total Government & Agency Obligations (Cost $37,044,171)		37,336,838
Loan Participations and Assignments 0.3%
Sovereign Loans
Gazprom, 144A, 8.125%, 7/31/2014 (Cost $440,000)	440,000	464,772
Municipal Bonds and Notes 1.0%
California, State General Obligation:
4.85%, 10/1/2014	1,000,000	1,015,830
5.65%, Mandatory Put 4/1/2013@100, 4/1/2039	240,000	253,646
La Vernia, TX, Higher Education Finance Corp. Revenue, Southwest Winners, Series B, 144A, 5.7%, 2/15/2011 (e)	300,000	299,340
Total Municipal Bonds and Notes (Cost $1,549,865)		1,568,816

	Shares	Value ($)
Securities Lending Collateral 4.0%
Daily Assets Fund Institutional, 0.27% (f) (g) (Cost $6,508,625)	6,508,625	6,508,625
Cash Equivalents 2.4%
Central Cash Management Fund, 0.19% (f) (Cost $3,872,309)	3,872,309	3,872,309

	% of Net Assets	Value ($)
Total Investment Portfolio (Cost $168,447,411)+	105.2	172,807,900
Other Assets and Liabilities, Net	(5.2)	(8,567,429)
Net Assets	100.0	164,240,471

* Floating rate notes are securities whose yields vary with a designated market index or market rate, such as the coupon-equivalent of the US Treasury bill rate. These securities are shown at their current rates as of October 31, 2009.

** Annualized yield at time of purchase; not a coupon rate.

⁺The cost for federal income tax purposes was $168,448,983. At October 31, 2009, net unrealized appreciation for all securities based on tax cost was $4,358,917. This consisted of aggregate gross unrealized appreciation for all securities in which there was an excess of value over tax cost of $5,351,498 and aggregate gross unrealized depreciation for all securities in which there was an excess of tax cost over value of $992,581.

(a) When-issued security.

(b) All or a portion of these securities were on loan (see Notes to Financial Statements). The value of all securities loaned at October 31, 2009 amounted to $6,391,442, which is 3.9% of net assets.

(c) Government-backed debt issued by financial companies or government sponsored enterprises.

(d) At October 31, 2009, this security has been pledged, in whole or in part, to cover initial margin requirements for open futures contracts.

(e) Bond is insured by this company:

Insurance Coverage	As a % of Total Investment Portfolio
American Capital Assurance	0.2

Many insurers who have traditionally guaranteed payment of municipal issues have been downgraded by the major rating agencies.

(f) Affiliated fund managed by Deutsche Investment Management Americas Inc. The rate shown is the annualized seven-day yield at period end.

(g) Represents collateral held in connection with securities lending. Income earned by the Fund is net of borrower rebates.

144A: Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers.

CLO: Collateralized Loan Obligation

FDIC: Federal Deposit Insurance Corp.

FSB: Federal Savings Bank

REG S: Securities sold under Regulation S may not be offered, sold or delivered within the United States or to, or for the account or benefit of, US persons, except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act of 1933.

REIT: Real Estate Investment Trust

Included in the portfolio are investments in mortgage or asset-backed securities which are interests in separate pools of mortgages or assets. Effective maturities of these investments may be shorter than stated maturities due to prepayments. Some separate investments in the Government National Mortgage Association issues have similar coupon rates and have been aggregated for presentation purposes in the investment portfolio.

At October 31, 2009, open futures contracts sold were as follows:

Futures	Expiration Date	Contracts	Aggregated Face Value ($)	Value ($)	Unrealized Depreciation ($)
5 Year US Treasury Note	12/31/2009	142	16,301,860	16,536,344	(234,484)
90 Day Eurodollar	12/13/2010	20	4,910,659	4,923,000	(12,341)
90 Day Eurodollar	9/13/2010	20	4,931,159	4,942,500	(11,341)
90 Day Eurodollar	3/15/2010	20	4,968,084	4,974,750	(6,666)
90 Day Eurodollar	12/14/2009	20	4,978,934	4,984,000	(5,066)
90 Day Eurodollar	6/14/2010	20	4,950,409	4,960,250	(9,841)
90 Day Eurodollar	6/13/2011	20	4,873,409	4,887,000	(13,591)
90 Day Eurodollar	9/19/2011	20	4,857,484	4,871,500	(14,016)
90 Day Eurodollar	3/14/2011	20	4,891,659	4,904,750	(13,091)
Total unrealized depreciation					(320,437)

At October 31, 2009, open credit default swap contracts purchased were as follows:

Effective/ Expiration Date	Notional Amount ($)	Fixed Cash Flows Paid	Underlying Debt Obligation/ Quality Rating (h)	Value ($)	Upfront Premiums Paid/ (Received) ($)	Unrealized Depreciation ($)
9/21/2009  12/20/2014	375,0001	1.4%	Dow Chemical Co., 7.375%, 11/1/2029, BBB-	4,589	7,077	(2,915)

At October 31, 2009, open credit default swap contracts sold were as follows:

Effective/ Expiration Date	Notional Amount ($) (i)	Fixed Cash Flows Received	Underlying Debt Obligation/ Quality Rating (h)	Value ($)	Upfront Premiums Paid/ (Received) ($)	Unrealized Appreciation/(Depreciation)($)
6/22/2009  9/20/2014	1,000,0001	5.0%	MetLife, Inc., 5.0%, 6/15/2015, A-	115,623	(15,947)	137,324
9/21/2009  12/20/2014	375,0001	2.1%	Valero Energy Co., 8.75%, 6/15/2030, BBB	(20,506)	(18,900)	(1,179)
Total net unrealized appreciation						136,145

(h) The quality ratings represent the lower of Moody's Investors Service, Inc. ("Moody's") or Standard & Poor's Corporation ("S&P") credit ratings.

(i) The maximum potential amount of future undiscounted payments that the Fund could be required to make under a credit default swap contract would be the notional amount of the contract. These potential amounts would be partially offset by any recovery values of the referenced debt obligation or net amounts received from the settlement of buy protection credit default swap contracts entered into by the Fund for the same referenced debt obligation.

At October 31, 2009, open interest rate swap contracts were as follows:

Effective/ Expiration Date	Notional Amount ($)	Cash Flows Paid by the Fund	Cash Flows Received by the Fund	Unrealized Appreciation/ (Depreciation) ($)
9/15/2010 9/15/2014	5,400,0002	Fixed — 3.15%	Floating — LIBOR	(9,085)
9/15/2010 9/15/2014	5,400,0002	Fixed — 3.15%	Floating — LIBOR	(9,085)
9/8/2009 9/8/2024	700,0002	Floating — LIBOR-SIFMA	Fixed — 8.125%	15,209
11/15/2009 11/15/2024	1,000,0003	Floating — LIBOR-SIFMA	Fixed — 8.7%	(267)
Total net unrealized depreciation				(3,228)

LIBOR: London InterBank Offered Rate

SIFMA: Securities Industry and Financial Markets Association

At October 31, 2009, open total return swap contracts were as follows:

Effective/ Expiration Date	Notional Amount ($)	Fixed Cash Flows Paid	Reference Entity	Value ($)	Upfront Premiums Paid/ (Received) ($)	Unrealized Depreciation ($)
6/1/2009 6/1/2012	7,000,0004	0.425%	Global Interest Rate Strategy Index	(61,841)	14,000	(81,096)
Counterparties: 1 JPMorgan Chase Securities, Inc. 2 Morgan Stanley 3 Barclays Bank LLC 4 Citigroup, Inc.

For information on the Fund's policy and additional disclosures regarding futures contracts, credit default swap contracts, interest rate swap contracts and total return swap contracts, please refer to the Derivatives section of Note A in the accompanying Notes to the Financial Statements.

Fair Value Measurements

Various inputs are used in determining the value of the Fund's investments. These inputs are summarized in three broad levels. Level 1 includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds and credit risk). Level 3 includes significant unobservable inputs (including the Fund's own assumptions in determining the fair value of investments). The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

The following is a summary of the inputs used as of October 31, 2009 in valuing the Fund's investments. For information on the Fund's policy regarding the valuation of investments, please refer to the Security Valuation section of Note A in the accompanying Notes to the Financial Statements.

Assets	Level 1	Level 2	Level 3	Total
Fixed Income (j) Corporate Bonds	$ —	$ 76,556,712	$ —	$ 76,556,712
Mortgage-Backed Securities Pass-Throughs	—	7,106,789	—	7,106,789
Asset-Backed	—	8,704,665	1,043,592	9,748,257
Commercial Mortgage-Backed Securities	—	17,926,149	—	17,926,149
Collateralized Mortgage Obligations	—	11,718,633	—	11,718,633
Government & Agency Obligations	—	36,554,451	497,500	37,051,951
Loan Participations and Assignments	—	464,772	—	464,772
Municipal Bonds and Notes	—	1,568,816	—	1,568,816
Short-Term Investments (j)	10,380,934	284,887	—	10,665,821
Derivatives (k)	—	152,533	—	152,533
Total	$ 10,380,934	$ 161,038,407	$ 1,541,092	$ 172,960,433

Liabilities	Level 1	Level 2	Level 3	Total
Derivatives (k)	$ (320,437)	$ (103,627)	$ —	$ (424,064)
Total	$ (320,437)	$ (103,627)	$ —	$ (424,064)

(j) See Investment Portfolio for additional detailed categorizations.

(k) Derivatives include unrealized appreciation (depreciation) on open futures contracts, credit default swap contracts, interest rate swap contracts and total return swap contracts.

The following is a reconciliation of the Fund's Level 3 investments for which significant unobservable inputs were used in determining value at October 31, 2009:

	Preferred Securities	Asset- Backed	Government & Agency Obligations	Total
Balance as of October 31, 2008	$ 224,805	$ —	$ —	$ 224,805
Net realized gain (loss)	(436,654)	984	—	(435,670)
Change in unrealized appreciation (depreciation)	301,140	1,595	—	302,735
Amortization premium/discount	(41)	—	—	(41)
Net purchases (sales)	(89,250)	1,041,013	497,500	1,449,263
Net transfers in (out) of Level 3	—	—	—	—
Balance as of October 31, 2009	$ —	$ 1,043,592	$ 497,500	$ 1,541,092
Net change in unrealized appreciation (depreciation) from investments still held as of October 31, 2009	$ —	$ 1,595	$ —	$ 1,595

The accompanying notes are an integral part of the financial statements.

Financial Statements

Statement of Assets and Liabilities as of October 31, 2009
Assets
Investments: Investments in securities, at value (cost $158,066,477) — including $6,391,442 of securities loaned	$ 162,426,966
Investments in Daily Assets Fund Institutional (cost $6,508,625)*	6,508,625
Investment in Central Cash Management Fund (cost $3,872,309)	3,872,309
Total investments, at value (cost $168,447,411)	172,807,900
Receivable for investments sold	2,359,629
Receivable for Fund shares sold	209,850
Interest receivable	1,466,154
Unrealized appreciation on swap contracts	152,533
Foreign taxes recoverable	5,695
Other assets	34,561
Total assets	177,036,322
Liabilities
Payable for investments purchased	1,825,158
Payable for when-issued securities purchased	3,586,213
Distributions payable	71,709
Payable for Fund shares redeemed	333,545
Payable upon return of securities loaned	6,508,625
Payable for daily variation margin on open futures contracts	118,281
Unrealized depreciation on swap contracts	103,627
Accrued management fee	16,302
Other accrued expenses and payables	232,391
Total liabilities	12,795,851
Net assets, at value	$ 164,240,471
Net Assets Consist of
Distributions in excess of net investment income	(96,519)
Net unrealized appreciation (depreciation) on: Investments	4,360,489
Futures	(320,437)
Swap contracts	48,906
Accumulated net realized gain (loss)	(22,148,177)
Paid-in capital	182,396,209
Net assets, at value	$ 164,240,471

^* Represent collateral on securities loaned.

The accompanying notes are an integral part of the financial statements.

Statement of Assets and Liabilities as of October 31, 2009 (continued)
Net Asset Value
Class A Net Asset Value and redemption price per share ($118,965,172 ÷ 12,889,368 outstanding shares of beneficial interest, $.001 par value, unlimited number of shares authorized)	$ 9.23
Maximum offering price per share (100 ÷ 97.25 of $9.23)	$ 9.49
Class B Net Asset Value, offering and redemption price (subject to contingent deferred sales charge) per share ($4,256,597 ÷ 460,968 outstanding shares of beneficial interest, $.001 par value, unlimited number of shares authorized)	$ 9.23
Class C Net Asset Value, offering and redemption price (subject to contingent deferred sales charge) per share ($25,694,514 ÷ 2,786,046 outstanding shares of beneficial interest, $.001 par value, unlimited number of shares authorized)	$ 9.22
Class S Net Asset Value, offering and redemption price per share ($6,578,898 ÷ 712,138 outstanding shares of beneficial interest, $.001 par value, unlimited number of shares authorized)	$ 9.24
Institutional Class Net Asset Value, offering and redemption price per share ($8,745,290 ÷ 946,269 outstanding shares of beneficial interest, $.001 par value, unlimited number of shares authorized)	$ 9.24

The accompanying notes are an integral part of the financial statements.

Statement of Operations for the year ended October 31, 2009
Investment Income
Income: Interest (net of foreign taxes withheld of $8,366)	$ 7,468,975
Income distributions — affiliated cash management vehicles	47,068
Securities lending income, including income from Daily Assets Fund Institutional, net of borrower rebates	104,907
Total Income	7,620,950
Expenses: Management fee	660,051
Administration fee	165,013
Services to shareholders	265,526
Distribution and service fees	569,104
Custodian fee	13,427
Professional fees	90,887
Trustees' fees and expenses	6,148
Reports to shareholders	83,815
Registration fees	75,330
Other	30,976
Total expenses before expense reductions	1,960,277
Expense reductions	(633,181)
Total expenses after expense reductions	1,327,096
Net investment income	6,293,854
Realized and Unrealized Gain (Loss)
Net realized gain (loss) from: Investments	(16,689,647)
Futures	(122,500)
Swap contracts	(269,293)
	(17,081,440)
Change in net unrealized appreciation (depreciation) on: Investments	20,687,882
Futures	(320,437)
Swap contracts	48,906
	20,416,351
Net gain (loss)	3,334,911
Net increase (decrease) in net assets resulting from operations	$ 9,628,765

The accompanying notes are an integral part of the financial statements.

Statement of Changes in Net Assets
Increase (Decrease) in Net Assets	Years Ended October 31,
	2009	2008
Operations: Net investment income	$ 6,293,854	$ 7,193,877
Net realized gain (loss)	(17,081,440)	(2,178,775)
Change in net unrealized appreciation (depreciation)	20,416,351	(15,725,332)
Net increase (decrease) in net assets resulting from operations	9,628,765	(10,710,230)
Distributions to shareholders from: Net investment income: Class A	(4,892,494)	(5,495,072)
Class B	(173,475)	(203,409)
Class C	(662,548)	(783,417)
Class S	(205,120)	(97,086)
Institutional Class	(361,898)	(609,981)
Total distributions	(6,295,535)	(7,188,965)
Fund share transactions: Proceeds from shares sold	65,120,922	159,613,918
Reinvestment of distributions	5,546,170	6,226,299
Cost of shares redeemed	(85,244,562)	(104,918,781)
Redemption fees	26,630	6,393
Net increase (decrease) in net assets from Fund share transactions	(14,550,840)	60,927,829
Increase (decrease) in net assets	(11,217,610)	43,028,634
Net assets at beginning of period	175,458,081	132,429,447
Net assets at end of period (including distributions in excess of net investment income and undistributed net investment income of $96,519 and $120,103, respectively)	$ 164,240,471	$ 175,458,081

The accompanying notes are an integral part of the financial statements.

Financial Highlights

Class A Years Ended October 31,	2009	2008	2007	2006	2005
Selected Per Share Data
Net asset value, beginning of period	$ 9.00	$ 9.91	$ 9.91	$ 9.89	$ 10.06
Income (loss) from investment operations: Net investment incomea	.35	.41	.43	.41	.31
Net realized and unrealized gain (loss)	.23	(.90)	.00*	.02	(.16)
Total from investment operations	.58	(.49)	.43	.43	.15
Less distributions from: Net investment income	(.35)	(.42)	(.43)	(.41)	(.32)
Redemption fees	.00*	.00*	.00*	.00*	.00*
Net asset value, end of period	$ 9.23	$ 9.00	$ 9.91	$ 9.91	$ 9.89
Total Return (%)b,c	6.62	(5.19)	4.41	4.44	1.50
Ratios to Average Net Assets and Supplemental Data
Net assets, end of period ($ millions)	119	135	86	63	79
Ratio of expenses before expense reductions (%)	1.10	.95	1.14	1.03	.91
Ratio of expenses after expense reductions (%)	.70	.70	.70	.58	.55
Ratio of net investment income (%)	3.91	4.22	4.31	4.16	3.15
Portfolio turnover rate (%)	177	181	230	198	161
a Based on average shares outstanding during the period. b Total return does not reflect the effect of any sales charges. c Total return would have been lower had certain expenses not been reduced. * Amount is less than $.005.

Class B Years Ended October 31,	2009	2008	2007	2006	2005
Selected Per Share Data
Net asset value, beginning of period	$ 9.00	$ 9.91	$ 9.91	$ 9.89	$ 10.06
Income (loss) from investment operations: Net investment incomea	.28	.34	.35	.35	.25
Net realized and unrealized gain (loss)	.23	(.91)	.00*	.02	(.16)
Total from investment operations	.51	(.57)	.35	.37	.09
Less distributions from: Net investment income	(.28)	(.34)	(.35)	(.35)	(.26)
Redemption fees	.00*	.00*	.00*	.00*	.00*
Net asset value, end of period	$ 9.23	$ 9.00	$ 9.91	$ 9.91	$ 9.89
Total Return (%)b,c	5.83	(5.91)	3.60	3.81	.88
Ratios to Average Net Assets and Supplemental Data
Net assets, end of period ($ millions)	4	6	6	8	9
Ratio of expenses before expense reductions (%)	1.89	1.84	1.90	1.77	1.65
Ratio of expenses after expense reductions (%)	1.45	1.45	1.45	1.19	1.15
Ratio of net investment income (%)	3.16	3.47	3.56	3.55	2.55
Portfolio turnover rate (%)	177	181	230	198	161
a Based on average shares outstanding during the period. b Total return does not reflect the effect of any sales charges. c Total return would have been lower had certain expenses not been reduced. * Amount is less than $.005.

Class C Years Ended October 31,	2009	2008	2007	2006	2005
Selected Per Share Data
Net asset value, beginning of period	$ 8.99	$ 9.90	$ 9.90	$ 9.88	$ 10.05
Income (loss) from investment operations: Net investment incomea	.28	.34	.35	.35	.25
Net realized and unrealized gain (loss)	.23	(.91)	.00*	.02	(.16)
Total from investment operations	.51	(.57)	.35	.37	.09
Less distributions from: Net investment income	(.28)	(.34)	(.35)	(.35)	(.26)
Redemption fees	.00*	.00*	.00*	.00*	.00*
Net asset value, end of period	$ 9.22	$ 8.99	$ 9.90	$ 9.90	$ 9.88
Total Return (%)b,c	5.85	(5.92)	3.61	3.81	.88
Ratios to Average Net Assets and Supplemental Data
Net assets, end of period ($ millions)	26	21	21	24	31
Ratio of expenses before expense reductions (%)	1.81	1.74	1.87	1.79	1.65
Ratio of expenses after expense reductions (%)	1.46	1.45	1.45	1.19	1.15
Ratio of net investment income (%)	3.16	3.47	3.56	3.55	2.55
Portfolio turnover rate (%)	177	181	230	198	161
a Based on average shares outstanding during the period. b Total return does not reflect the effect of any sales charges. c Total return would have been lower had certain expenses not been reduced. * Amount is less than $.005.

Class S Years Ended October 31,	2009	2008	2007	2006	2005a
Selected Per Share Data
Net asset value, beginning of period	$ 9.00	$ 9.91	$ 9.91	$ 9.89	$ 10.01
Income (loss) from investment operations: Net investment incomeb	.37	.43	.45	.40	.23
Net realized and unrealized gain (loss)	.24	(.90)	.00***	.01	(.11)
Total from investment operations	.61	(.47)	.45	.41	.12
Less distributions from: Net investment income	(.37)	(.44)	(.45)	(.39)	(.24)
Redemption fees	.00***	.00***	.00***	.00***	.00***
Net asset value, end of period	$ 9.24	$ 9.00	$ 9.91	$ 9.91	$ 9.89
Total Return (%)c	7.01	(4.96)	4.67	4.29	1.19**
Ratios to Average Net Assets and Supplemental Data
Net assets, end of period ($ millions)	7	4	1	.6	.3
Ratio of expenses before expense reductions (%)	.77	.75	1.15	.98	.92*
Ratio of expenses after expense reductions (%)	.46	.45	.45	.71	.74*
Ratio of net investment income (%)	4.16	4.47	4.56	4.03	3.07*
Portfolio turnover rate (%)	177	181	230	198	161
a For the period from February 1, 2005 (commencement of operations of Class S shares) to October 31, 2005. b Based on average shares outstanding during the period. c Total return would have been lower had certain expenses not been reduced. * Annualized ** Not annualized *** Amount is less than $.005.

Institutional Class Years Ended October 31,	2009	2008	2007	2006	2005
Selected Per Share Data
Net asset value, beginning of period	$ 9.01	$ 9.92	$ 9.92	$ 9.90	$ 10.07
Income (loss) from investment operations: Net investment incomea	.37	.43	.45	.41	.31
Net realized and unrealized gain (loss)	.23	(.90)	.00*	.02	(.16)
Total from investment operations	.60	(.47)	.45	.43	.15
Less distributions from: Net investment income	(.37)	(.44)	(.45)	(.41)	(.32)
Redemption fees	.00*	.00*	.00*	.00*	.00*
Net asset value, end of period	$ 9.24	$ 9.01	$ 9.92	$ 9.92	$ 9.90
Total Return (%)b	6.90	(4.95)	4.64	4.47	1.50
Ratios to Average Net Assets and Supplemental Data
Net assets, end of period ($ millions)	9	11	18	19	33
Ratio of expenses before expense reductions (%)	.76	.68	.82	.77	.66
Ratio of expenses after expense reductions (%)	.45	.45	.45	.56	.55
Ratio of net investment income (%)	4.17	4.47	4.56	4.18	3.15
Portfolio turnover rate (%)	177	181	230	198	161
a Based on average shares outstanding during the period. b Total return would have been lower had certain expenses not been reduced. * Amount is less than $.005.

Notes to Financial Statements

A. Organization and Significant Accounting Policies

DWS Short Duration Fund (the "Fund") is a diversified series of DWS Advisor Funds (the "Trust"), which is registered under the Investment Company Act of 1940, as amended, (the "1940 Act"), as an open-end management investment company organized as a Massachusetts business trust.

The Fund offers multiple classes of shares which provide investors with different purchase options. Class A shares are offered to investors subject to an initial sales charge. Class B shares are offered to investors without an initial sales charge but are subject to higher ongoing expenses than Class A shares and a contingent deferred sales charge payable upon certain redemptions. Class B shares automatically convert to Class A shares six years after issuance. Class C shares are offered to investors without an initial sales charge but are subject to higher ongoing expenses than Class A shares and a contingent deferred sales charge payable upon certain redemptions within one year of purchase. Class C shares do not automatically convert into another class. Institutional Class shares are offered to a limited group of investors, are not subject to initial or contingent deferred sales charges and have lower ongoing expenses than other classes. Class S shares are not subject to initial or contingent deferred sales charges and are generally not available to new investors except under certain circumstances.

Investment income, realized and unrealized gains and losses, and certain fund-level expenses and expense reductions, if any, are borne pro rata on the basis of relative net assets by the holders of all classes of shares, except that each class bears certain expenses unique to that class such as distribution and service fees, services to shareholders and certain other class-specific expenses. Differences in class-level expenses may result in payment of different per share dividends by class. All shares of the Fund have equal rights with respect to voting subject to class-specific arrangements.

The Fund's financial statements are prepared in accordance with accounting principles generally accepted in the United States of America which require the use of management estimates. Actual results could differ from those estimates. The policies described below are followed consistently by the Fund in the preparation of its financial statements.

Security Valuation. Investments are stated at value determined as of the close of regular trading on the New York Stock Exchange on each day the exchange is open for trading. Debt securities are valued by independent pricing services approved by the Trustees of the Fund. If the pricing services are unable to provide valuations, the securities are valued at the most recent bid quotation or evaluated price, as applicable, obtained from one or more broker-dealers. Such services may use various pricing techniques which take into account appropriate factors such as yield, quality, coupon rate, maturity, type of issue, trading characteristics and other data, as well as broker quotes.

Money market instruments purchased with an original or remaining maturity of sixty days or less, maturing at par, are valued at amortized cost. Investments in open-end investment companies are valued at their net asset value each business day.

Securities and other assets for which market quotations are not readily available or for which the above valuation procedures are deemed not to reflect fair value are valued in a manner that is intended to reflect their fair value as determined in accordance with procedures approved by the Trustees. In accordance with the Fund's valuation procedures, factors used in determining value may include, but are not limited to, the type of the security, the size of the holding, the initial cost of the security, the existence of any contractual restrictions on the security's disposition, the price and extent of public trading in similar securities of the issuer or of comparable companies, quotations or evaluated prices from broker-dealers and/or pricing services, information obtained from the issuer, analysts, and/or the appropriate stock exchange (for exchange-traded securities), an analysis of the company's financial statements, an evaluation of the forces that influence the issuer and the market(s) in which the security is purchased and sold and with respect to debt securities, the maturity, coupon, creditworthiness, currency denomination, and the movement of the market in which they trade. The value determined under these procedures may differ from published values for the same securities.

Disclosure about the classification of fair value measurements is included in a table following the Fund's Investment Portfolio.

Securities Lending. The Fund may lend securities to certain financial institutions. The Fund retains beneficial ownership of the securities it has loaned and continues to receive interest and dividends paid by the issuer of securities and to participate in any changes in their market value. The Fund requires the borrowers of the securities to maintain collateral with the Fund consisting of either cash or liquid, unencumbered assets having a value at least equal to the value of the securities loaned. When the collateral falls below specified amounts, the lending agents will use their best efforts to obtain additional collateral on the next business day to meet required amounts under the security lending agreement. The Fund may invest the cash collateral into a joint trading account in an affiliated money market fund pursuant to Exemptive Orders issued by the SEC. The Fund receives compensation for lending its securities either in the form of fees or by earning interest on invested cash collateral net of borrower rebates and fees paid to a lending agent. Either the Fund or the borrower may terminate the loan. There may be risks of delay and costs in recovery of securities or even loss of rights in the collateral should the borrower of the securities fail financially. The Fund is also subject to all investment risks associated with the reinvestment of any cash collateral received, including, but not limited to, interest rate, credit and liquidity risk associated with such investments.

When-Issued/Delayed Delivery Securities. The Fund may purchase securities with delivery or payment to occur at a later date beyond the normal settlement period. At the time the Fund enters into a commitment to purchase a security, the transaction is recorded and the value of the security is reflected in the net asset value. The price of such security and the date when the security will be delivered and paid for are fixed at the time the transaction is negotiated. The value of the security may vary with market fluctuations. No interest accrues to the Fund until payment takes place. At the time the Fund enters into this type of transaction it is required to segregate cash or other liquid assets at least equal to the amount of the commitment.

Certain risks may arise upon entering into when-issued or delayed delivery securities from the potential inability of counterparties to meet the terms of their contracts or if the issuer does not issue the securities due to political, economic, or other factors. Additionally, losses may arise due to changes in the value of the underlying securities.

Derivatives. Authorized accounting guidance requires that disclosures about the Fund's derivative and hedging activities and derivatives accounted for as hedging instruments must be disclosed separately from derivatives that do not qualify for hedge accounting. Because investment companies account for their derivatives at fair value and record any changes in fair value in current period earnings, the Fund's derivatives are not accounted for as hedging instruments. As such, even though the Fund may use derivatives in an attempt to achieve an economic hedge, the Fund's derivatives are not considered to be hedging instruments. The disclosure below is presented in accordance with authoritative accounting guidance.

Interest Rate Swap Contracts. The Fund enters into interest rate swap transactions to gain exposure to difference parts of the yield curve while managing overall duration. The use of interest rate swaps is a highly specialized activity that involves investment techniques and risks different from those associated with ordinary portfolio security transactions. In an interest rate swap, the Fund agrees to pay to the other party to the interest rate swap (which is known as the "counterparty") a fixed rate payment in exchange for the counterparty agreeing to pay to the Fund a variable rate payment, or the Fund agrees to receive from the counterparty a fixed rate payment in exchange for the counterparty agreeing to receive from the Fund a variable rate payment. The payment obligations are based on the notional amount of the swap. Certain risks may arise when entering into swap transactions including counterparty default, liquidity or unfavorable changes in interest rates. In connection with these agreements, securities and or cash may be identified as collateral in accordance with the terms of the swap agreements to provide assets of value and recourse in the event of default. The maximum counterparty credit risk is the net present value of the cash flows to be received from or paid to the counterparty over the term of the interest rate swap contract, to the extent that this amount is beneficial to the Fund, in addition to any related collateral posted to the counterparty by the Fund. This risk may be partially reduced by a master netting arrangement between the Fund and the counterparty. Payments received or made at the end of the measurement period are recorded as realized gain or loss in the Statement of Operations. The value of the swap is adjusted daily based upon a price supplied by a Board-approved pricing vendor and the change in value is recorded as unrealized appreciation or depreciation.

A summary of the open interest rate swap contracts as of October 31, 2009 is included in a table following the Fund's Investment Portfolio. For the year ended October 31, 2009, the Fund invested in interest rate swap contracts with total notional values ranging from $0 to $12,500,000.

Credit Default Swap Contracts. A credit default swap is a contract between a buyer and a seller of protection against pre-defined credit events for the reference entity. The Fund buys or sells credit default swap contracts to gain exposure to an underlying issuer's credit quality characteristics without directly investing in that issuer, or to hedge the risk of default on Fund securities. As a seller in the credit default swap contract, the Fund is required to pay the par (or other agreed-upon) value of the referenced entity to the counterparty with the occurrence of a credit event by a third party, such as a US or foreign corporate issuer, on the reference entity, which would likely result in a loss to the Fund. In return, the Fund receives from the counterparty a periodic stream of payments over the term of the contract provided that no credit event has occurred. If no credit event occurs, the Fund keeps the stream of payments with no payment obligations. The Fund also buys credit default swap contracts in order to hedge against the risk of a credit event on debt securities, in which case the Fund functions as the counterparty referenced above. This involves the risk that the contract may expire worthless. It also involves counterparty risk that the seller may fail to satisfy its payment obligations to the Fund with the occurrence of a credit event. When the Fund sells a credit default swap contract it will cover its commitment. This is achieved by, among other methods, maintaining cash or liquid assets equal to the aggregate notional value of the reference entities for all outstanding credit default swap contracts sold by the Fund.

Credit default swap contracts are marked to market daily based upon quotations from a Board-approved pricing vendor and the change in value, if any, is recorded daily as unrealized gain or loss. An upfront payment made by the Fund is recorded as an asset in the Statement of Assets and Liabilities. An upfront payment received by the Fund is recorded as a liability in the Statement of Assets and Liabilities. Under the terms of the credit default swap contracts, the Fund receives or makes quarterly payments based on a specified interest rate on a fixed notional amount. These payments are recorded as a realized gain or loss in the Statement of Operations. Payments received or made as a result of a credit event or termination of the contract are recognized, net of a proportional amount of the upfront payment, as realized gains or losses.

A summary of the open credit default swap contracts as of October 31, 2009 is included in a table following the Fund's Investment Portfolio. For the year ended October 31, 2009, the Fund invested in credit default swap contracts with total notional values ranging from $0 to $8,000,000.

Total Return Swap Contracts. Total return swaps involve commitments to pay interest in exchange for a market-linked return based on a notional amount. The Fund enters into total return swap transactions to gain exposure to different parts of the yield curve while managing overall duration. To the extent the total return of the reference security or index underlying the total return swap exceeds or falls short of the offsetting interest rate obligation, the Fund will receive a payment or make a payment to the counterparty, respectively. Certain risks may arise when entering into swap transactions including counterparty default, liquidity or unfavorable changes in the value of underlying reference security or index. Payments received or made at the end of each measurement period are recorded as realized gain or loss in the Statement of Operations. The value of the swap is adjusted daily based upon a price supplied by a Board-approved pricing vendor and the change in value is recorded as unrealized appreciation or depreciation.

A summary of the open total return swap contracts as of October 31, 2009 is included in a table following the Fund's Investment Portfolio. For the year ended October 31, 2009, the Fund invested in total return swap contracts with total notional values ranging from $0 to $7,000,000.

Futures Contracts. A futures contract is an agreement between a buyer or seller and an established futures exchange or its clearinghouse in which the buyer or seller agrees to take or make a delivery of a specific amount of a financial instrument at a specified price on a specific date (settlement date). The Fund enters into interest rate futures to gain exposure to different parts of the yield curve while managing overall duration.

Futures contracts are valued at the most recent settlement price. Upon entering into a futures contract, the Fund is required to deposit with a financial intermediary cash or securities ("initial margin") in an amount equal to a certain percentage of the face value indicated in the futures contract. Subsequent payments ("variation margin") are made or received by the Fund dependent upon the daily fluctuations in the value and are recorded for financial reporting purposes as unrealized gains or losses by the Fund. Gains or losses are realized when the contract expires or is closed. Since all futures contracts are exchange traded, counterparty risk is minimized as the exchange's clearinghouse acts as the counterparty, and guarantees the futures against default.

Certain risks may arise upon entering into futures contracts, including the risk that an illiquid market will limit the Fund's ability to close out a futures contract prior to the settlement date and that a change in the value of a futures contract may not correlate exactly with the changes in the value of the underlying hedged security, index or currency. Risk of loss may exceed amounts recognized in the Statement of Assets and Liabilities.

A summary of the open future contracts as of October 31, 2009 is included in a table following the Fund's Investment Portfolio. For the year ended October 31, 2009, the Fund invested in futures contracts with a total value ranging from $0 to approximately $55,984,000.

The following tables summarize the value of the Fund's derivative instruments held as of October 31, 2009 and the related location in the accompanying Statement of Assets and Liabilities, presented by primary underlying risk exposure:

Asset Derivatives	Swap Contracts
Interest Rate Contracts (a)	$ 15,209
Credit Contracts (a)	137,324
	$ 152,533

The above derivative is located in the following Statement of Assets and Liabilities account:

(a) Unrealized appreciation on swap contracts

Liability Derivatives	Swap Contracts	Futures Contracts	Total
Interest Rate Contracts (a)	$ (99,533)	$ (320,437)	$ (419,970)
Credit Contracts (a)	(4,094)	—	(4,094)
	$ (103,627)	$ (320,437)	$ (424,064)

Each of the above derivatives is located in the following Statement of Assets and Liabilities accounts:

(a) Unrealized depreciation on swap contracts and net unrealized appreciation (depreciation) on futures. Payable for daily variation margin on open futures contracts reflects unsettled variation margin.

Additionally, the amount of unrealized and realized gains and losses on derivative instruments recognized in Fund earnings during the year ended October 31, 2009 and the related location in the accompanying Statement of Operations is summarized in the following tables by primary underlying risk exposure:

Realized Gain (Loss)	Swap Contracts	Futures Contracts	Total
Interest Rate Contracts (a)	$ (221,223)	$ (122,500)	$ (343,723)
Credit Contracts (a)	(48,070)	—	(48,070)
	$ (269,293)	$ (122,500)	$ (391,793)

Each of the above derivatives is located in the following Statement of Operations accounts:

(a) Net realized gain (loss) from swaps contracts and futures, respectively

Change in Net Unrealized Appreciation (Depreciation)
	Swap Contracts	Futures Contracts	Total
Interest Rate Contracts (a)	$ (84,324)	$ (320,437)	$ (404,761)
Credit Contracts (a)	133,230	—	133,230
	$ 48,906	$ (320,437)	$ (271,531)

Each of the above derivatives is located in the following Statement of Operations accounts:

(a) Change in net unrealized appreciation (depreciation) on swaps contracts and futures, respectively

Federal Income Taxes. The Fund's policy is to comply with the requirements of the Internal Revenue Code, as amended, which are applicable to regulated investment companies, and to distribute all of its taxable income to its shareholders.

At October 31, 2009, the Fund had a net tax basis capital loss carryforward of approximately $22,467,000, which may be applied against any realized net taxable capital gains of each succeeding year until fully utilized or until October 31, 2012 ($83,000), October 31, 2013 ($1,646,000), October 31, 2014 ($1,157,000), October 31, 2015 ($190,000), October 31, 2016 ($2,167,000) and October 31, 2017 ($17,224,000), the respective expiration dates, whichever occurs first.

The Fund has reviewed the tax positions for the open tax years as of October 31, 2009 and has determined that no provision for income tax is required in the Fund's financial statements. The Fund's federal tax returns for the prior three fiscal years remain open subject to examination by the Internal Revenue Service.

Distribution of Income and Gains. Net investment income of the Fund is declared as a daily dividend and distributed to shareholders monthly. Net realized gains from investment transactions, in excess of available capital loss carryforwards, would be taxable to the Fund if not distributed, and, therefore, will be distributed to shareholders at least annually.

The timing and characterization of certain income and capital gains distributions are determined annually in accordance with federal tax regulations which may differ from accounting principles generally accepted in the United States of America. These differences primarily relate to investments in futures contracts and certain securities sold at a loss. As a result, net investment income (loss) and net realized gain (loss) on investment transactions for a reporting period may differ significantly from distributions during such period. Accordingly, the Fund may periodically make reclassifications among certain of its capital accounts without impacting the net asset value of the Fund.

At October 31, 2009, the Fund's components of distributable earnings (accumulated losses) on a tax-basis were as follows:

Undistributed ordinary income	$ 36,592
Capital loss carryforwards	$ (22,467,000)
Net unrealized appreciation (depreciation) on investments	$ 4,358,917

In addition, the tax character of distributions paid to shareholders by the Fund is summarized as follows:

	Years Ended October 31,
	2009	2008
Distributions from ordinary income	$ 6,295,535	$ 7,188,965

Redemption Fees. During the year, the Fund imposed a redemption fee of 2% of the total redemption amount on all Fund shares redeemed or exchanged within 15 days of buying them, either by purchase or exchange. This fee was assessed and retained by the Fund for the benefit of the remaining shareholders. The redemption fee was accounted for as an addition to paid-in capital. The Fund no longer imposes the 2% redemption fee on Fund shares acquired (either by purchase or exchange) on or after June 1, 2009.

Expenses. Expenses of the Trust arising in connection with a specific fund are allocated to that fund. Other Trust expenses which cannot be directly attributed to a fund are apportioned among the funds in the Trust.

Contingencies. In the normal course of business, the Fund may enter into contracts with service providers that contain general indemnification clauses. The Fund's maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet been made. However, based on experience, the Fund expects the risk of loss to be remote.

Other. Investment transactions are accounted for on a trade date plus one basis for daily net asset value calculations. However, for financial reporting purposes, investment security transactions are reported on trade date. Interest income is recorded on the accrual basis net of foreign withholding taxes. Realized gains and losses from investment transactions are recorded on an identified cost basis. All discounts and premiums are accreted/amortized for both tax and financial reporting purposes.

B. Purchases and Sales of Securities

During the year ended October 31, 2009, purchases and sales of investment securities (excluding short-term investments and US Treasury securities) aggregated $200,760,660 and $197,371,453, respectively. Purchases and sales of US Treasury securities aggregated $81,938,111 and $102,248,828, respectively.

C. Related Parties

Management Agreement. Under the Investment Management Agreement with Deutsche Investment Management Americas Inc. ("DIMA" or the "Advisor"), an indirect, wholly owned subsidiary of Deutsche Bank, AG, the Advisor directs the investments of the Fund in accordance with its investment objectives, policies and restrictions. The Advisor determines the securities, instruments and other contracts relating to investments to be purchased, sold or entered into by the Fund.

Prior to December 1, 2008, pursuant to a written contract, Aberdeen Asset Management Inc. ("AAMI"), a direct, wholly owned subsidiary of Aberdeen Asset Management PLC, served as subadvisor to the Fund. AAMI was paid for its services by the Advisor from its fee as investment advisor to the Fund. The Fund's board approved the termination of AAMI as the Fund's subadvisor. Effective December 1, 2008 the Advisor assumed all day-to-day advisory responsibilities that were previously delegated to AAMI.

Under the Investment Management Agreement with the Advisor, the Fund pays a monthly management fee based on the Fund's average daily net assets, computed and accrued daily and payable monthly, at the following annual rates:

First $500 million of the Fund's average daily net assets	.400%
Next $500 million of such net assets	.385%
Next $1.0 billion of such net assets	.370%
Over $2.0 billion of such net assets	.355%

For the period from November 1, 2008 through November 30, 2009, the Advisor has contractually agreed to waive 0.182% of its management fee.

For the period from November 1, 2008, through September 30, 2009, the Advisor had contractually agreed to waive its fees and/or reimburse certain operating expenses of the Fund to the extent necessary to maintain the operating expenses (excluding certain expenses such as extraordinary expenses, taxes, brokerage and interest) of each class as follows:

Class A	.88%
Class B	1.63%
Class C	1.63%
Class S	.63%
Institutional Class	.63%

In addition, for the period from November 1, 2008 through September 30, 2009, the Advisor had voluntarily agreed to waive its fees and/or reimburse certain operating expenses of the Fund to the extent necessary to maintain the operating expenses (excluding certain expenses such as extraordinary expenses, taxes, brokerage and interest) of each class as follows:

Class A	.70%
Class B	1.45%
Class C	1.45%
Class S	.45%
Institutional Class	.45%

Effective October 1, 2009, the Advisor has contractually agreed to waive its fees and/or reimburse certain operating expenses of the Fund to the extent necessary to maintain the operating expenses (excluding certain expenses such as extraordinary expenses, taxes, brokerage and interest) of each class as follows:

Class A	.98%
Class B	1.73%
Class C	1.73%
Class S	.73%
Institutional Class	.73%

Effective October 1, 2009, the Advisor has voluntarily agreed to waive its fees and/or reimburse certain operating expenses of the Fund to the extent necessary to maintain the operating expenses (excluding certain expenses such as extraordinary expenses, taxes, brokerage and interest) of each class as follows:

Class A	.75%
Class B	1.50%
Class C	1.50%
Class S	.50%
Institutional Class	.50%

This voluntary waiver or reimbursement may be terminated at any time at the option of the Advisor.

Accordingly for the year ended October 31, 2009, the Advisor waived a portion of its management fee pursuant to the Investment Management Agreement aggregating $402,122 and the amount charged aggregated $257,929, which was equivalent to an annual effective rate of 0.16% of the Fund's average daily net assets.

In addition, the Advisor reimbursed $1,402 and $4,399 of sub-recordkeeping expenses for Class S and Institutional Class shares, respectively.

Administration Fee. Pursuant to an Administrative Services Agreement, DIMA provides most administrative services to the Fund. For all services provided under the Administrative Services Agreement, the Fund pays the Advisor an annual fee ("Administration Fee") of 0.10% of the Fund's average daily net assets, computed and accrued daily and payable monthly. For the year ended October 31, 2009, the Administration Fee was $165,013, of which $13,982 is unpaid.

Service Provider Fees. DWS Investments Service Company ("DISC"), an affiliate of the Advisor, is the transfer agent, dividend-paying agent and shareholder service agent for the Fund. Pursuant to a sub-transfer agency agreement between DISC and DST Systems, Inc. ("DST"), DISC has delegated certain transfer agent, dividend-paying agent and shareholder service agent functions to DST. DISC compensates DST out of the shareholder servicing fee it receives from the Fund. For the year ended October 31, 2009, the amounts charged to the Fund by DISC were as follows:

Services to Shareholders	Total Aggregated	Waived
Class A	$ 86,864	$ 86,864
Class B	9,212	9,212
Class C	18,357	18,357
Class S	1,885	1,885
Institutional Class	1,383	1,383
	$ 117,701	$ 117,701

Distribution and Service Fees. Under the Fund's Class B and Class C 12b-1 Plans, DWS Investments Distributors, Inc. ("DIDI"), an affiliate of the Advisor, receives a fee ("Distribution Fee") of 0.75% of average daily net assets of each of Class B and C shares. In accordance with the Fund's Underwriting and Distribution Services Agreement, DIDI enters into related selling group agreements with various firms at various rates for sales of Class B and C shares. For the year ended October 31, 2009, the Distribution Fee was as follows:

Distribution Fee	Total Aggregated	Unpaid at October 31, 2009
Class B	$ 41,129	$ 3,830
Class C	158,516	18,845
	$ 199,645	$ 22,675

In addition, DIDI provides information and administrative services for a fee ("Service Fee") to Class A, B and C shareholders at an annual rate of up to 0.25% of average daily net assets for each such class. DIDI in turn has various agreements with financial services firms that provide these services and pays these fees based upon the assets of shareholder accounts the firms service. For the year ended October 31, 2009, the Service Fee was as follows:

Service Fee	Total Aggregated	Waived	Unpaid at October 31, 2009	Annual Effective Rate
Class A	$ 303,069	$ 101,146	$ 42,378	.16%
Class B	13,666	1,269	1,465	.23%
Class C	52,724	5,142	9,696	.23%
	$ 369,459	$ 107,557	$ 53,539

Underwriting Agreement and Contingent Deferred Sales Charge. DIDI is the principal underwriter for the Fund. Underwriting commissions paid in connection with the distribution of Class A shares for the year ended October 31, 2009, aggregated $11,225.

In addition, DIDI receives any contingent deferred sales charge ("CDSC") from Class B share redemptions occurring within six years of purchase and Class C share redemptions occurring within one year of purchase. There is no such charge upon redemption of any share appreciation or reinvested dividends. The CDSC is based on declining rates ranging from 4% to 1% for Class B and 1% for Class C, of the value of the shares redeemed. For the year ended October 31, 2009, the CDSC for the Class B and C shares aggregated $13,610 and $7,597, respectively. A deferred sales charge of up to 0.75% is assessed on certain redemptions of Class A shares. For the year ended October 31, 2009, DIDI received $113 for Class A shares.

Typesetting and Filing Service Fees. Under an agreement with DIMA, DIMA is compensated for providing typesetting and certain regulatory filing services to the Fund. For the year ended October 31, 2009, the amount charged to the Fund by DIMA included in the Statement of Operations under "reports to shareholders" aggregated $18,113, of which $8,799 is unpaid.

Trustees' Fees and Expenses. The Fund paid each Trustee not affiliated with the Advisor retainer fees plus specified amounts for various committee services and for the Board Chairperson.

Affiliated Cash Management Vehicles. The Fund may invest uninvested cash balances in affiliated funds managed by the Advisor. Affiliated cash management vehicles do not pay the Advisor a management fee. The Fund currently invests in Central Cash Management Fund. Prior to October 2, 2009, the Fund invested in Cash Management QP Trust ("QP Trust"). Effective October 2, 2009, QP Trust merged into Central Cash Management Fund. Central Cash Management Fund seeks to provide a high level of current income consistent with liquidity and the preservation of capital.

D. Line of Credit

The Fund and other affiliated funds (the "Participants") share in a $450 million revolving credit facility provided by a syndication of banks. The Fund may borrow for temporary or emergency purposes, including the meeting of redemption requests that otherwise might require the untimely disposition of securities. The Participants are charged an annual commitment fee which is allocated based on net assets, among each of the Participants. Interest is calculated at a rate per annum equal to the sum of the Federal Funds Rate plus 1.25 percent plus if LIBOR exceeds the Federal Fund Rate the amount of such excess. The Fund may borrow up to a maximum of 33 percent of its net assets under the agreement.

E. Share Transactions

The following table summarizes share and dollar activity in the Fund:

	Year Ended October 31, 2009		Year Ended October 31, 2008
	Shares	Dollars	Shares	Dollars
Shares sold
Class A	4,769,268	$ 42,554,343	14,019,175	$ 136,705,436
Class B	235,008	2,060,993	311,292	3,014,801
Class C	1,257,520	11,258,184	1,057,384	10,251,483
Class S	602,021	5,415,547	360,477	3,460,391
Institutional Class	428,271	3,831,855	634,444	6,181,807
		$ 65,120,922		$ 159,613,918
Shares issued to shareholders in reinvestment of distributions
Class A	523,012	$ 4,636,938	531,964	$ 5,121,959
Class B	14,764	130,772	17,004	164,624
Class C	49,610	440,706	54,449	526,911
Class S	16,297	145,341	7,959	76,298
Institutional Class	21,677	192,413	34,583	336,507
		$ 5,546,170		$ 6,226,299
Shares redeemed
Class A	(7,359,958)	$ (65,081,687)	(8,232,821)	$ (79,102,587)
Class B	(413,140)	(3,707,071)	(281,556)	(2,728,340)
Class C	(843,020)	(7,457,004)	(937,988)	(9,056,003)
Class S	(316,340)	(2,859,104)	(97,023)	(932,920)
Institutional Class	(694,568)	(6,139,696)	(1,338,960)	(13,098,931)
		$ (85,244,562)		$ (104,918,781)
Redemption fees		$ 26,630		$ 6,393
Net increase (decrease)
Class A	(2,067,678)	$ (17,865,848)	6,318,318	$ 62,728,281
Class B	(163,368)	(1,515,040)	46,740	452,702
Class C	464,110	4,242,141	173,845	1,722,993
Class S	301,978	2,701,784	271,413	2,604,417
Institutional Class	(244,620)	(2,113,877)	(669,933)	(6,580,564)
		$ (14,550,840)		$ 60,927,829

F. Review for Subsequent Events

Management has reviewed the events and transactions from November 1, 2009 through December 21, 2009, the date the financial statements were available to be issued for subsequent events, and has determined that there were no material events that would require disclosure in the Fund's financial statements through this date.

Report of Independent Registered Public Accounting Firm

To the Trustees of DWS Advisor Funds and Shareholders of DWS Short Duration Fund:

In our opinion, the accompanying statement of assets and liabilities, including the investment portfolio, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of DWS Short Duration Fund (the "Fund") at October 31, 2009, and the results of its operations, the changes in its net assets and the financial highlights for each of the periods indicated therein, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the Fund's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at October 31, 2009 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.

Boston, Massachusetts
December 21, 2009 PricewaterhouseCoopers LLP

Tax Information (Unaudited)

A total of 3% of the dividends distributed during the fiscal year was derived from interest on US government securities which is generally exempt from state income tax.

Please consult a tax advisor if you have questions about federal or state income tax laws, or on how to prepare your tax returns. If you have specific questions about your account, please call (800) 621-1048.

Investment Management Agreement Approval

The Board of Trustees, including the Independent Trustees, approved the renewal of your Fund's investment management agreement (the "Agreement") with Deutsche Investment Management Americas Inc. ("DWS") in September 2009.

In terms of the process that the Board followed prior to approving the Agreement, shareholders should know that:

• In September 2009, all but one of the Fund's Trustees were independent of DWS and its affiliates.

• The Trustees meet frequently to discuss fund matters. Each year, the Trustees dedicate substantial time to contract review matters. Over the course of several months, the Board's Contract Committee, in coordination with the Board's Fixed Income and Quant Oversight Committee, reviewed comprehensive materials received from DWS, independent third parties and independent counsel. These materials included an analysis of the Fund's performance, fees and expenses, and profitability compiled by the Fund's independent fee consultant. The Board also received extensive information throughout the year regarding performance of the Fund.

• The Independent Trustees regularly meet privately with their independent counsel to discuss contract review and other matters. In addition, the Independent Trustees were also advised by the Fund's independent fee consultant in the course of their review of the Fund's contractual arrangements and considered a comprehensive report prepared by the independent fee consultant in connection with their deliberations (the "IFC Report").

• In connection with reviewing the Agreement, the Board also reviewed the terms of the Fund's Rule 12b-1 plan, distribution agreement, administrative services agreement, transfer agency agreement and other material service agreements.

• Based on its evaluation of the information provided, the Contract Committee presented its findings and recommendations to the Independent Trustees as a group. The Independent Trustees reviewed the Contract Committee's findings and recommendations and presented their recommendations to the full Board.

In connection with the contract review process, the Contract Committee and the Board considered the factors discussed below, among others. The Board also considered that DWS and its predecessors have managed the Fund since its inception, and the Board believes that a long-term relationship with a capable, conscientious advisor is in the best interests of the Fund. The Board considered, generally, that shareholders chose to invest or remain invested in the Fund knowing that DWS managed the Fund, and that the Agreement was approved by the Fund's shareholders. DWS is part of Deutsche Bank, a major global banking institution that is engaged in a wide range of financial services. The Board believes that there are significant advantages to being part of a global asset management business that offers a wide range of investing expertise and resources, including hundreds of portfolio managers and analysts with research capabilities in many countries throughout the world.

While shareholders may focus primarily on fund performance and fees, the Fund's Board considers these and many other factors, including the quality and integrity of DWS's personnel and such other issues as back-office operations, fund valuations, and compliance policies and procedures.

Nature, Quality and Extent of Services. The Board considered the terms of the Agreement, including the scope of advisory services provided under the Agreement. The Board noted that, under the Agreement, DWS provides portfolio management services to the Fund and that, pursuant to a separate administrative services agreement, DWS provides administrative services to the Fund. The Board considered the experience and skills of senior management and investment personnel, the resources made available to such personnel, the ability of DWS to attract and retain high-quality personnel, and the organizational depth and stability of DWS. The Board reviewed the Fund's performance over short-term and long-term periods and compared those returns to various agreed-upon performance measures, including market indices and a peer universe compiled by the independent fee consultant using information supplied by Lipper Inc. ("Lipper"). The Board also noted that it has put into place a process of identifying "Focus Funds" (e.g., funds performing poorly relative to their benchmark or a peer universe compiled by Lipper), and receives more frequent reporting and information from DWS regarding such funds, along with DWS's remedial plans to address underperformance. The Board believes this process is an effective manner of identifying and addressing underperforming funds. Based on the information provided, the Board noted that for the one-, three- and five-year periods ended December 31, 2008, the Fund's performance (Class A shares) was in the 4th quartile of the applicable Lipper universe (the 1st quartile being the best performers and the 4th quartile being the worst performers). The Board also observed that the Fund has underperformed its benchmark in each of the one-, three- and five-year periods ended December 31, 2008. The Board noted the disappointing investment performance of the Fund in recent periods and continued to discuss with senior management of DWS the factors contributing to such underperformance and actions being taken to improve performance. The Board observed that the Fund had experienced improved relative performance during the first seven months of 2009. The Board recognized that DWS has made significant changes to the Fund's management structure, including the termination of Aberdeen Asset Management, Inc. as the Fund's sub-advisor and the introduction of a new portfolio management team in December 2008.

On the basis of this evaluation and the ongoing review of investment results by the Board, the Board concluded that the nature, quality and extent of services provided by DWS historically have been and continue to be satisfactory.

Fees and Expenses. The Board considered the Fund's investment management fee schedule, operating expenses, and total expense ratios, and comparative information provided by Lipper and the independent fee consultant regarding investment management fee rates paid to other investment advisors by similar funds (1st quartile being the most favorable and 4th quartile being the least favorable). With respect to management fees paid to other investment advisors by similar funds, the Board noted that the contractual fee rates paid by the Fund, which include the 0.10% fee paid to DWS under the Fund's administrative services agreement, were higher than the median (4th quartile) of the applicable Lipper peer group (based on Lipper data provided as of December 31, 2008). The Board also reviewed data comparing each share class's total (net) operating expenses to the applicable Lipper expense universe. The Board concluded that the comparative Lipper operating expense data was of limited utility, as it likely significantly understated the current expense ratios of many peer funds due to the substantial declines in net assets as a result of market losses and net redemptions that many funds experienced between mid-September 2008 and March 2009 and that were not reflected in the data. The Board also noted that the expense limitations agreed to by DWS helped to ensure that the Fund's total (net) operating expenses would remain competitive.

The information considered by the Board as part of their review of management fees included information regarding fees charged by DWS and its affiliates to similar institutional accounts and to similar funds managed by the same portfolio management teams but offered primarily to European investors ("DWS Europe funds"), in each case as applicable. The Board observed that advisory fee rates for institutional accounts generally were lower than the management fees charged by similarly managed DWS US Mutual Funds ("DWS Funds"), but also took note of the differences in services provided to DWS Funds as compared to institutional accounts. In the case of DWS Europe funds, the Board observed that fee rates for DWS Europe funds generally were higher than for similarly managed DWS Funds, but noted that differences in the types of services provided to DWS Funds relative to DWS Europe funds made it difficult to compare such fees.

On the basis of the information provided, the Board concluded that management fees were reasonable and appropriate in light of the nature, quality and extent of services provided by DWS.

Profitability. The Board reviewed detailed information regarding revenues received by DWS under the Agreement. The Board considered the estimated costs and pre-tax profits realized by DWS from advising the DWS Funds, as well as estimates of the pre-tax profits attributable to managing the Fund in particular. The Board also received information regarding the estimated enterprise-wide profitability of DWS and its affiliates with respect to all fund services in totality and by fund. The Board reviewed DWS's methodology in allocating its costs to the management of the Fund. Based on the information provided, the Board concluded that the pre-tax profits realized by DWS in connection with the management of the Fund were not unreasonable. The Board also reviewed information regarding the profitability of certain similar investment management firms. The Board noted that while information regarding the profitability of such firms is limited (and in some cases is not necessarily prepared on a comparable basis), DWS and its affiliates' overall profitability with respect to the DWS fund complex (after taking into account distribution and other services provided to the funds by DWS and its affiliates) was lower than the overall profitability levels of many comparable firms for which such data was available.

Economies of Scale. The Board considered whether there are economies of scale with respect to the management of the Fund and whether the Fund benefits from any economies of scale. The Board noted that the Fund's management fee schedule includes fee breakpoints. The Board concluded that the Fund's fee schedule represents an appropriate sharing between the Fund and DWS of such economies of scale as may exist in the management of the Fund at current asset levels.

Other Benefits to DWS and Its Affiliates. The Board also considered the character and amount of other incidental benefits received by DWS and its affiliates, including any fees received by DWS for administrative services provided to the Fund and any fees received by an affiliate of DWS for distribution services. The Board also considered benefits to DWS related to brokerage and soft-dollar allocations, including allocating brokerage to pay for research generated by parties other than the executing broker dealers, which pertain primarily to funds investing in equity securities, along with the incidental public relations benefits to DWS related to DWS Funds advertising and cross-selling opportunities among DWS products and services. The Board concluded that management fees were reasonable in light of these fallout benefits.

Compliance. The Board considered the significant attention and resources dedicated by DWS to documenting and enhancing its compliance processes in recent years. The Board noted in particular (i) the experience and seniority of both DWS's chief compliance officer and the Fund's chief compliance officer; (ii) the large number of DWS compliance personnel; and (iii) the substantial commitment of resources by DWS and its affiliates to compliance matters.

Based on all of the information considered and the conclusions reached, the Board unanimously (including the Independent Trustees) determined that the continuation of the Agreement is in the best interests of the Fund. In making this determination, the Board did not give particular weight to any single factor identified above. The Board considered these factors over the course of numerous meetings, certain of which were in executive session with only the Independent Trustees and their counsel present. It is possible that individual Trustees may have weighed these factors differently in reaching their individual decisions to approve the continuation of the Agreement.

Summary of Management Fee Evaluation by Independent Fee Consultant

October 9, 2009, As Revised November 20, 2009

Pursuant to an Order entered into by Deutsche Investment Management Americas and affiliates (collectively, "DeAM") with the Attorney General of New York, I, Thomas H. Mack, have been appointed the Independent Fee Consultant for the DWS Funds (formerly the DWS Scudder Funds). My duties include preparing an annual written evaluation of the management fees DeAM charges the Funds, considering among other factors the management fees charged by other mutual fund companies for like services, management fees DeAM charges other clients for like services, DeAM's costs of supplying services under the management agreements and related profit margins, possible economies of scale if a Fund grows larger, and the nature and quality of DeAM's services, including fund performance. This report summarizes my evaluation for 2009, including my qualifications, the evaluation process for each of the DWS Funds, consideration of certain complex-level factors, and my conclusions. I served in substantially the same capacity in 2007 and 2008.

Qualifications

For more than 35 years I have served in various professional capacities within the investment management business. I have held investment analysis and advisory positions, including securities analyst, portfolio strategist and director of investment policy with a large investment firm. I have also performed business management functions, including business development, financial management and marketing research and analysis.

Since 1991, I have been an independent consultant within the asset management industry. I have provided services to over 125 client organizations, including investment managers, mutual fund boards, product distributors and related organizations. Over the past ten years I have completed a number of assignments for mutual fund boards, specifically including assisting boards with management contract renewal.

I hold a Master of Business Administration degree, with highest honors, from Harvard University and Master of Science and Bachelor of Science (highest honors) degrees from the University of California at Berkeley. I am an independent director and audit committee financial expert for two closed-end mutual funds and serve in various leadership and financial oversight capacities with non-profit organizations.

Evaluation of Fees for each DWS Fund

My work focused primarily on evaluating, fund-by-fund, the fees charged to each of the 124 publicly offered Fund portfolios in the DWS Fund family. For each Fund, I considered each of the key factors mentioned above, as well as any other relevant information. In doing so I worked closely with the Funds' Independent Directors in their annual contract renewal process, as well as in their approval of contracts for several new funds (documented separately).

In evaluating each Fund's fees, I reviewed comprehensive materials provided by or on behalf of DeAM, including expense information prepared by Lipper Analytical, comparative performance information, profitability data, manager histories, and other materials. I also accessed certain additional information from the Lipper, Strategic Insight, and Morningstar databases and drew on my industry knowledge and experience.

To facilitate evaluating this considerable body of information, I prepared for each Fund a document summarizing the key data elements in each area as well as additional analytics discussed below. This made it possible to consider each key data element in the context of the others.

In the course of contract renewal, DeAM agreed to implement a number of fee and expense adjustments requested by the Independent Directors which will favorably impact future fees and expenses, and my evaluation includes the effects of these changes.

Fees and Expenses Compared with Other Funds

The competitive fee and expense evaluation for each fund focused on two primary comparisons:

The Fund's contractual management fee (the advisory fee plus the administration fee where applicable) compared with those of a group of typically 12-15 funds in the same Lipper investment category (e.g. Large Capitalization Growth) having similar distribution arrangements and being of similar size.

The Fund's total expenses compared with a broader universe of funds from the same Lipper investment category and having similar distribution arrangements.

These two comparisons provide a view of not only the level of the fee compared with funds of similar scale but also the total expense the Fund bears for all the services it receives, in comparison with the investment choices available in the Fund's investment category and distribution channel. The principal figure-of-merit used in these comparisons was the subject Fund's percentile ranking against peers.

DeAM's Fees for Similar Services to Others

DeAM provided management fee schedules for all of its US domiciled fund and non-fund investment management accounts in any of the investment categories where there is a DWS Fund. These similar products included the other DWS Funds, non-fund pooled accounts, institutional accounts and sub-advisory accounts. Using this information, I calculated for each Fund the fee that would be charged to each similar product, at the subject Fund's asset level.

Evaluating information regarding non-fund products is difficult because there are varying levels of services required for different types of accounts, with mutual funds generally requiring considerably more regulatory and administrative types of service as well as having more frequent cash flows than other types of accounts. Also, while mutual fund fees for similar fund products can be expected to be similar, there will be some differences due to different pricing conditions in different distribution channels (e.g. retail funds versus those used in variable insurance products), differences in underlying investment processes and other factors.

Costs and Profit Margins

DeAM provided a detailed profitability analysis for each Fund. After making some adjustments so that the presentation would be more comparable to the available industry figures, I reviewed profit margins from investment management alone, from investment management plus other fund services (excluding distribution) provided to the Funds by DeAM (principally shareholder services), and DeAM profits from all sources, including distribution. A later section comments on overall profitability.

Economies of Scale

Economies of scale — an expected decline in management cost per dollar of fund assets as fund assets grow — are very rarely quantified and documented because of inherent difficulties in collecting and analyzing relevant data. However, in virtually every investment category that I reviewed, larger funds tend to have lower fees and lower total expenses than smaller funds. To see how each DWS Fund compares with this industry observation, I reviewed:

The trend in Fund assets over the last five years and the accompanying trend in total expenses. This shows if the Fund has grown and, if so, whether total expense (management fees as well as other expenses) have declined as a percent of assets.

Whether the Fund has break-points in its management fee schedule, the extent of the fee reduction built into the schedule and the asset levels where the breaks take effect, and in the case of a sub-advised Fund how the Fund's break-points compare with those of the sub-advisory fee schedule.

How the Fund's contractual fee schedule compares with trends in the industry data. To accomplish this, I constructed a chart showing how actual latest-fiscal-year contractual fees of the Fund and of other similar funds relate to average fund assets, with the subject Fund's contractual fee schedule superimposed.

Quality of Service — Performance

The quality-of-service evaluation focused on investment performance, which is the principal result of the investment management service. Each Fund's performance was reviewed over the past 1, 3, 5 and 10 years, as applicable, and compared with that of other funds in the same investment category and with a suitable market index.

In addition, I calculated and reviewed risk-adjusted returns relative to an index of similar mutual funds' returns and a suitable market index. The risk-adjusted returns analysis provides a way of determining the extent to which the Fund's return comparisons are mainly the product of investment value-added (or lack thereof) or alternatively taking considerably more or less risk than is typical in its investment category.

I also received and considered the history of portfolio manager changes for each Fund, as this provided an important context for evaluating the performance results.

Complex-Level Considerations

While this evaluation was conducted mainly at the individual fund level, there are some issues relating to the reasonableness of fees that can alternatively be considered across the whole fund complex:

I reviewed DeAM's profitability analysis for all DWS Funds, with a view toward determining if the allocation procedures used were reasonable and how profit levels compared with public data for other investment managers.

I considered whether DeAM and affiliates receive any significant ancillary or "fall-out" benefits that should be considered in interpreting the direct profitability results. These would be situations where serving as the investment manager of the Funds is beneficial to another part of the Deutsche Bank organization.

I considered how aggregated DWS Fund expenses had varied over the years, by asset class and in the context of trends in asset levels.

I reviewed the structure of the DeAM organization, trends in staffing levels, and information on compensation of investment management and other professionals compared with industry data.

Findings

Based on the process and analysis discussed above, which included reviewing a wide range of information from management and external data sources and considering among other factors the fees DeAM charges other clients, the fees charged by other fund managers, DeAM's costs and profits associated with managing the Funds, economies of scale, possible fall-out benefits, and the nature and quality of services provided, in my opinion the management fees charged the DWS Funds are reasonable.

Thomas H. Mack

Board Members and Officers

The following table presents certain information regarding the Board Members and Officers of the Trust as of October 31, 2009. Each Board Member's year of birth is set forth in parentheses after his or her name. Unless otherwise noted, (i) each Board Member has engaged in the principal occupation(s) noted in the table for at least the most recent five years, although not necessarily in the same capacity; and (ii) the address of each Independent Board Member is c/o Dawn-Marie Driscoll, PO Box 100176, Cape Coral, FL 33904. Except as otherwise noted below, the term of office for each Board Member is until the election and qualification of a successor, or until such Board Member sooner dies, resigns, is removed or as otherwise provided in the governing documents of the fund. Because the fund does not hold an annual meeting of shareholders, each Board Member will hold office for an indeterminate period. The Board Members may also serve in similar capacities with other funds in the fund complex. The Length of Time Served represents the year in which the Board Member joined the board of one or more DWS funds now overseen by the Board.

Independent Board Members
Name, Year of Birth, Position with the Fund and Length of Time Served1	Business Experience and Directorships During the Past Five Years	Number of Funds in DWS Fund Complex Overseen
Paul K. Freeman (1950) Chairperson since 20092 Board Member since 1993	Consultant, World Bank/Inter-American Development Bank; Governing Council of the Independent Directors Council (governance, executive committees); formerly, Project Leader, International Institute for Applied Systems Analysis (1998-2001); Chief Executive Officer, The Eric Group, Inc. (environmental insurance) (1986-1998)	125
John W. Ballantine (1946) Board Member since 1999	Retired; formerly, Executive Vice President and Chief Risk Management Officer, First Chicago NBD Corporation/The First National Bank of Chicago (1996-1998); Executive Vice President and Head of International Banking (1995-1996). Directorships: Healthways, Inc. (provider of disease and care management services); Portland General Electric (utility company); Stockwell Capital Investments PLC (private equity). Former Directorships: First Oak Brook Bancshares, Inc. and Oak Brook Bank	125
Henry P. Becton, Jr. (1943) Board Member since 1990	Vice Chair, WGBH Educational Foundation. Directorships: Association of Public Television Stations; Becton Dickinson and Company3 (medical technology company); Belo Corporation3 (media company); Public Radio International; PRX, The Public Radio Exchange; The PBS Foundation. Former Directorships: Boston Museum of Science; American Public Television; Concord Academy; New England Aquarium; Mass. Corporation for Educational Telecommunications; Committee for Economic Development; Public Broadcasting Service	125
Dawn-Marie Driscoll (1946) Board Member since 1987	President, Driscoll Associates (consulting firm); Executive Fellow, Center for Business Ethics, Bentley University; formerly, Partner, Palmer & Dodge (1988-1990); Vice President of Corporate Affairs and General Counsel, Filene's (1978-1988). Directorships: Trustee of 20 open-end mutual funds managed by Sun Capital Advisers, Inc. (since 2007); Director of ICI Mutual Insurance Company (since 2007); Advisory Board, Center for Business Ethics, Bentley University; Trustee, Southwest Florida Community Foundation (charitable organization). Former Directorships: Investment Company Institute (audit, executive, nominating committees) and Independent Directors Council (governance, executive committees)	125
Keith R. Fox (1954) Board Member since 1996	Managing General Partner, Exeter Capital Partners (a series of private equity funds). Directorships: Progressive Holding Corporation (kitchen goods importer and distributor); Natural History, Inc. (magazine publisher); Box Top Media Inc. (advertising); The Kennel Shop (retailer)	125
Kenneth C. Froewiss (1945) Board Member since 2001	Adjunct Professor of Finance, NYU Stern School of Business (September 2009-present; Clinical Professor from 1997-September 2009); Member, Finance Committee, Association for Asian Studies (2002-present); Director, Mitsui Sumitomo Insurance Group (US) (2004-present); prior thereto, Managing Director, J.P. Morgan (investment banking firm) (until 1996)	125
Richard J. Herring (1946) Board Member since 1990	Jacob Safra Professor of International Banking and Professor, Finance Department, The Wharton School, University of Pennsylvania (since July 1972); Co-Director, Wharton Financial Institutions Center (since July 2000); Director, Japan Equity Fund, Inc. (since September 2007), Thai Capital Fund, Inc. (since September 2007), Singapore Fund, Inc. (since September 2007). Formerly, Vice Dean and Director, Wharton Undergraduate Division (July 1995-June 2000); Director, Lauder Institute of International Management Studies (July 2000-June 2006)	125
William McClayton (1944) Board Member since 2004	Managing Director, Diamond Management & Technology Consultants, Inc. (global management consulting firm) (2001-present); Directorship: Board of Managers, YMCA of Metropolitan Chicago; formerly: Senior Partner, Arthur Andersen LLP (accounting) (1966-2001); Trustee, Ravinia Festival	125
Rebecca W. Rimel (1951) Board Member since 1995	President and Chief Executive Officer, The Pew Charitable Trusts (charitable organization) (1994 to present); Trustee, Thomas Jefferson Foundation (charitable organization) (1994 to present); Trustee, Executive Committee, Philadelphia Chamber of Commerce (2001-2007); Trustee, Pro Publica (2007-present) (charitable organization); Director, CardioNet, Inc.3 (2009-present) (health care). Formerly, Executive Vice President, The Glenmede Trust Company (investment trust and wealth management) (1983-2004); Board Member, Investor Education (charitable organization) (2004-2005); Director, Viasys Health Care3 (January 2007-June 2007)	125
William N. Searcy, Jr. (1946) Board Member since 1993	Private investor since October 2003; Trustee of 20 open-end mutual funds managed by Sun Capital Advisers, Inc. (since October 1998). Formerly, Pension & Savings Trust Officer, Sprint Corporation3 (telecommunications) (November 1989-September 2003)	125
Jean Gleason Stromberg (1943) Board Member since 1997	Retired. Formerly, Consultant (1997-2001); Director, US Government Accountability Office (1996-1997); Partner, Fulbright & Jaworski, L.L.P. (law firm) (1978-1996). Directorships: The William and Flora Hewlett Foundation; Business Leadership Council, Wellesley College. Former Directorships: Service Source, Inc., Mutual Fund Directors Forum (2002-2004), American Bar Retirement Association (funding vehicle for retirement plans) (1987-1990 and 1994-1996)	125
Robert H. Wadsworth (1940) Board Member since 1999	President, Robert H. Wadsworth & Associates, Inc. (consulting firm) (1983 to present); Director, The Phoenix Boys Choir Association	128

Interested Board Member
Name, Year of Birth, Position with the Fund and Length of Time Served1	Business Experience and Directorships During the Past Five Years	Number of Funds in Fund Complex Overseen
Axel Schwarzer4 (1958) Board Member since 2006	Managing Director5, Deutsche Asset Management; Vice Chairman5 of Deutsche Asset Management and Member of the Management Board of DWS Investments, responsible for Global Relationship Management; formerly: Head of Deutsche Asset Management Americas (2005-2009); CEO of DWS Investments (2005-2009); board member of DWS Investments, Germany (1999-2005); Head of Sales and Product Management for the Retail and Private Banking Division of Deutsche Bank in Germany (1997-1999); various strategic and operational positions for Deutsche Bank Germany Retail and Private Banking Division in the field of investment funds, tax driven instruments and asset management for corporates (1989-1996)	125

Officers6
Name, Year of Birth, Position with the Fund and Length of Time Served7	Principal Occupation(s) During Past 5 Years and Other Directorships Held
Michael G. Clark8 (1965) President, 2006-present	Managing Director5, Deutsche Asset Management (2006-present); President of DWS family of funds; Director, ICI Mutual Insurance Company (since October 2007); formerly, Director of Fund Board Relations (2004-2006) and Director of Product Development (2000-2004), Merrill Lynch Investment Managers; Senior Vice President Operations, Merrill Lynch Asset Management (1999-2000)
John Millette9 (1962) Vice President and Secretary, 1999-present	Director5, Deutsche Asset Management
Paul H. Schubert8 (1963) Chief Financial Officer, 2004-present Treasurer, 2005-present	Managing Director5, Deutsche Asset Management (since July 2004); formerly, Executive Director, Head of Mutual Fund Services and Treasurer for UBS Family of Funds (1998-2004); Vice President and Director of Mutual Fund Finance at UBS Global Asset Management (1994-1998)
Caroline Pearson9 (1962) Assistant Secretary, 1997-present	Managing Director5, Deutsche Asset Management
Rita Rubin10 (1970) Assistant Secretary, 2009-present	Vice President and Counsel, Deutsche Asset Management (since October 2007); formerly, Vice President, Morgan Stanley Investment Management (2004-2007); Attorney, Shearman & Sterling LLP (2004); Director and Associate General Counsel, UBS Global Asset Management (US) Inc. (2001-2004)
Paul Antosca9 (1957) Assistant Treasurer, 2007-present	Director5, Deutsche Asset Management (since 2006); Vice President, The Manufacturers Life Insurance Company (U.S.A.) (1990-2006)
Jack Clark9 (1967) Assistant Treasurer, 2007-present	Director5, Deutsche Asset Management (since 2007); formerly, Vice President, State Street Corporation (2002-2007)
Diane Kenneally9 (1966) Assistant Treasurer, 2007-present	Director5, Deutsche Asset Management
Jason Vazquez10 (1972) Anti-Money Laundering Compliance Officer, 2007-present	Vice President, Deutsche Asset Management (since 2006); formerly, AML Operations Manager for Bear Stearns (2004-2006), Supervising Compliance Principal and Operations Manager for AXA Financial (1999-2004)
Robert Kloby10 (1962) Chief Compliance Officer, 2006-present	Managing Director5, Deutsche Asset Management
J. Christopher Jackson10 (1951) Chief Legal Officer, 2006-present	Director5, Deutsche Asset Management (2006-present); formerly, Director, Senior Vice President, General Counsel and Assistant Secretary, Hansberger Global Investors, Inc. (1996-2006); Director, National Society of Compliance Professionals (2002-2005) (2006-2009)

¹ The length of time served represents the year in which the Board Member joined the board of one or more DWS funds currently overseen by the Board.

² Mr. Freeman assumed the Chairperson role as of January 1, 2009. Prior to that Ms. Driscoll served as Chairperson of certain DWS funds since 2004.

³ A publicly held company with securities registered pursuant to Section 12 of the Securities Exchange Act of 1934.

⁴ Effective November 18, 2009, Mr. Schwarzer resigned from the Board. The mailing address of Mr. Schwarzer is DWS Investment GmbH, Mainzer Landstr. 178-190, Floor 5C, 60327 Frankfurt am Main, Germany. Mr. Schwarzer was an interested Board Member by virtue of his positions with Deutsche Asset Management. As an interested person, Mr. Schwarzer received no compensation from the fund.

⁵ Executive title, not a board directorship.

⁶ As a result of their respective positions held with the Advisor, these individuals are considered "interested persons" of the Advisor within the meaning of the 1940 Act. Interested persons receive no compensation from the fund.

⁷ The length of time served represents the year in which the officer was first elected in such capacity for one or more DWS funds.

⁸ Address: 345 Park Avenue, New York, New York 10154.

⁹ Address: One Beacon Street, Boston, MA 02108.

¹⁰ Address: 280 Park Avenue, New York, New York 10017.

The fund's Statement of Additional Information ("SAI") includes additional information about the Board Members. The SAI is available, without charge, upon request. If you would like to request a copy of the SAI, you may do so by calling the following toll-free number: (800) 621-1048.

Account Management Resources

For More Information	The automated telephone system allows you to access personalized account information and obtain information on other DWS funds using either your voice or your telephone keypad. Certain account types within Classes A, B, C and S also have the ability to purchase, exchange or redeem shares using this system. For more information, contact your financial advisor. You may also access our automated telephone system or speak with a DWS Investments representative by calling the appropriate number below: For shareholders of Classes A, B, C and Institutional Class: (800) 621-1048 For shareholders of Class S: (800) 728-3337
Web Site	www.dws-investments.com View your account transactions and balances, trade shares, monitor your asset allocation, and change your address, 24 hours a day. Obtain prospectuses and applications, blank forms, interactive worksheets, news about DWS funds, subscription to fund updates by e-mail, retirement planning information, and more.
Written Correspondence	DWS Investments PO Box 219151 Kansas City, MO 64121-9151
Proxy Voting	A description of the fund's policies and procedures for voting proxies for portfolio securities and information about how the fund voted proxies related to its portfolio securities during the 12-month period ended June 30 is available on our Web site — www.dws-investments.com (click on "proxy voting"at the bottom of the page) — or on the SEC's Web site — www.sec.gov. To obtain a written copy of the fund's policies and procedures without charge, upon request, call us toll free at (800) 621-1048.
Principal Underwriter	If you have questions, comments or complaints, contact: DWS Investments Distributors, Inc. 222 South Riverside Plaza Chicago, IL 60606-5808 (800) 621-1148

	Class A	Class B	Class C	Class S	Institutional Class
Nasdaq Symbol	SDUAX	SDUBX	SDUCX	SDUSX	MGSFX
CUSIP Number	23339E 822	23339E 814	23339E 798	23339E 780	23339E 772
Fund Number	434	634	734	2334	557

ITEM 2.	CODE OF ETHICS
	As of the end of the period, October 31, 2009, DWS Short Duration Fund has a code of ethics, as defined in Item 2 of Form N-CSR, that applies to its Principal Executive Officer and Principal Financial Officer. There have been no amendments to, or waivers from, a provision of the code of ethics during the period covered by this report that would require disclosure under Item 2. A copy of the code of ethics is filed as an exhibit to this Form N-CSR.
ITEM 3.	AUDIT COMMITTEE FINANCIAL EXPERT
	The Funds’ audit committee is comprised solely of trustees who are “independent” (as such term has been defined by the Securities and Exchange Commission (“SEC”) in regulations implementing Section 407 of the Sarbanes-Oxley Act (the “Regulations”)). The Funds’ Board of Trustees has determined that there are several “audit committee financial experts” (as such term has been defined by the Regulations) serving on the Funds’ audit committee including Mr. William McClayton, the chair of the Funds’ audit committee. The SEC has stated that an audit committee financial expert is not an “expert” for any purpose, including for purposes of Section 11 of the Securities Act of 1933 and the designation or identification of a person as an audit committee financial expert pursuant to this Item 3 of Form N-CSR does not impose on such person any duties, obligations or liability that are greater than the duties, obligations and liability imposed on such person as a member of the audit committee and board of directors in the absence of such designation or identification.
ITEM 4.	PRINCIPAL ACCOUNTANT FEES AND SERVICES

DWS SHORT DURATION FUND

FORM N-CSR DISCLOSURE RE: AUDIT FEES

The following table shows the amount of fees that PricewaterhouseCoopers, LLP (“PWC”), the Fund’s independent registered public accounting firm, billed to the Fund during the Fund’s last two fiscal years. The Audit Committee approved in advance all audit services and non-audit services that PWC provided to the Fund.

Services that the Fund’s Independent Registered Public Accounting Firm Billed to the Fund

Fiscal Year Ended October 31,	Audit Fees Billed to Fund	Audit-Related Fees Billed to Fund	Tax Fees Billed to Fund	All Other Fees Billed to Fund
2009	$55,885	$0	$0	$0
2008	$57,380	$0	$0	$0

Services that the Fund’s Independent Registered Public Accounting Firm Billed to the Adviser and Affiliated Fund Service Providers

The following table shows the amount of fees billed by PWC to Deutsche Investment Management Americas Inc. (“DeIM” or the “Adviser”), and any entity controlling, controlled by or under common control with DeIM (“Control Affiliate”) that provides ongoing services to the Fund (“Affiliated Fund Service Provider”), for engagements directly related to the Fund’s operations and financial reporting, during the Fund’s last two fiscal years.

Fiscal Year October 31,	Audit-Related Fees Billed to Adviser and Affiliated Fund Service Providers	Tax Fees Billed to Adviser and Affiliated Fund Service Providers	All Other Fees Billed to Adviser and Affiliated Fund Service Providers
2009	$2,000	$0	$0
2008	$0	$19,000	$0

The “Audit-Related Fees” were billed for services in connection with the agreed-upon procedures and the above “Tax Fees” were billed in connection with tax compliance and tax planning.

Non-Audit Services

The following table shows the amount of fees that PWC billed during the Fund’s last two fiscal years for non-audit services. The Audit Committee pre-approved all non-audit services that PWC provided to the Adviser and any Affiliated Fund Service Provider that related directly to the Fund’s operations and financial reporting. The Audit Committee requested and received information from PWC about any non-audit services that PWC rendered during the Fund’s last fiscal year to the Adviser and any Affiliated Fund Service Provider. The Committee considered this information in evaluating PWC’s independence.

Fiscal Year Ended October 31,	Total Non-Audit Fees Billed to Fund (A)	Total Non-Audit Fees billed to Adviser and Affiliated Fund Service Providers (engagements related directly to the operations and financial reporting of the Fund) (B)	Total Non-Audit Fees billed to Adviser and Affiliated Fund Service Providers (all other engagements) (C)	Total of (A), (B) and (C)
2009	$0	$0	$0	$0
2008	$0	$19,000	$600,000	$619,000

All other engagement fees were billed for services provided by PWC for services related to consulting on an IT project.

Audit Committee Pre-Approval Policies and Procedures. Generally, each Fund’s Audit Committee must pre approve (i) all services to be performed for a Fund by a Fund’s Independent Registered Public Accounting Firm and (ii) all non-audit services to be performed by a Fund’s Independent Registered Public Accounting Firm for the DIMA Entities with respect to operations and financial reporting of the Fund, except that the Chairperson or Vice Chairperson of each Fund’s Audit Committee may grant the pre-approval for non-audit services described in items (i) and (ii) above for non-prohibited services for engagements of less than $100,000. All such delegated pre approvals shall be presented to each Fund’s Audit Committee no later than the next Audit Committee meeting.

There were no amounts that were approved by the Audit Committee pursuant to the de minimis exception under Rule 2-01 of Regulation S-X.

According to the registrant’s principal Independent Registered Public Accounting Firm, all of the principal Independent Registered Public Accounting Firm's hours spent on auditing the registrant's financial statements were attributed to work performed by full-time permanent employees of the principal Independent Registered Public Accounting Firm.

***

PwC advised the Fund's Audit Committee that PwC has identified two matters that it determined to be inconsistent with the SEC's auditor independence rules. In the first instance, an employee of PwC had power of attorney over an account which included DWS funds. The employee did not perform any audit services for the DWS Funds, but did work on a non audit project for Deutsche Bank AG. In the second instance, an employee of PwC served as a nominee shareholder (effectively equivalent to a Trustee) of various companies/trusts since 2001. Some of these companies held shares of Aberdeen, a sub advisor to certain DWS Funds, and of certain funds sponsored by subsidiaries of Deutsche Bank AG. The trustee relationship has ceased. PwC informed the Audit Committee that these matters could have constituted an investment in an affiliate of an audit client in violation of the Rule 2-01(c)(1) of Regulation S-X. PwC advised the Audit Committee that PwC believes its independence had not been impacted as it related to the audits of the Fund. In reaching this conclusion, PwC noted that during the time of its audit, the engagement team was not aware of the investment and that PwC does not believe these situations affected PwC's ability to act objectively and impartially and to issue a report on financial statements as the funds' independent auditor.

ITEM 5.	AUDIT COMMITTEE OF LISTED REGISTRANTS
	Not Applicable
ITEM 6.	SCHEDULE OF INVESTMENTS
	Not Applicable
ITEM 7.	DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES
	Not applicable.

ITEM 8.	PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES
	Not applicable.

ITEM 9.	PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS
	Not Applicable.

ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

	The primary function of the Nominating and Governance Committee is to identify and recommend individuals for membership on the Board and oversee the administration of the Board Governance Guidelines. Shareholders may recommend candidates for Board positions by forwarding their correspondence by U.S. mail or courier service to Chairman of the Board, P.O. Box 100176, Cape Coral, FL 33910.
ITEM 11.	CONTROLS AND PROCEDURES
	(a)          The Chief Executive and Financial Officers concluded that the Registrant’s Disclosure Controls and Procedures are effective based on the evaluation of the Disclosure Controls and Procedures as of a date within 90 days of the filing date of this report.
	(b)         There have been no changes in the registrant’s internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal controls over financial reporting.
ITEM 12.	EXHIBITS
	(a)(1)     Code of Ethics pursuant to Item 2 of Form N-CSR is filed and attached hereto as EX-99.CODE ETH.
	(a)(2)     Certification pursuant to Rule 30a-2(a) under the Investment Company Act of 1940 (17 CFR 270.30a-2(a)) is filed and attached hereto as Exhibit 99.CERT.
	(b)          Certification pursuant to Rule 30a-2(b) under the Investment Company Act of 1940 (17 CFR 270.30a-2(b)) is furnished and attached hereto as Exhibit 99.906CERT.

Form N-CSR Item F

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Registrant:	DWS Short Duration Fund, a series of DWS Advisor Funds
By:	/s/Michael G. Clark Michael G. Clark President
Date:	December 30, 2009

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Registrant:	DWS Short Duration Fund, a series of DWS Advisor Funds
By:	/s/Michael G. Clark Michael G. Clark President
Date:	December 30, 2009
By:	/s/Paul Schubert Paul Schubert Chief Financial Officer and Treasurer
Date:	December 30, 2009

EX-99.CODE ETH

DWS Investments

Principal Executive and Principal Financial Officer Code of Ethics

For the Registered Management Investment Companies Listed on Appendix A

Effective Date

[January 31, 2005]

Table of Contents

I. Overview 3

II. Purposes of the Officer Code 3

III. Responsibilities of Covered Officers 4

A. Honest and Ethical Conduct 4

B. Conflicts of Interest 4

C. Use of Personal Fund Shareholder Information 6

D. Public Communications 6

E. Compliance with Applicable Laws, Rules and Regulations 6

IV. Violation Reporting 7

A. Overview 7

B. How to Report 7

C. Process for Violation Reporting to the Fund Board 7

D. Sanctions for Code Violations 7

V. Waivers from the Officer Code 8

VI. Amendments to the Code 8

VII. Acknowledgement and Certification of Adherence to the Officer Code 8

IX. Recordkeeping 9

X. Confidentiality 9

Appendices 10

Appendix A: List of Officers Covered under the Code, by Board 10

Appendix B: Officer Code Acknowledgement and Certification Form 11

Appendix C: Definitions 13

I.

Overview

This Principal Executive Officer and Principal Financial Officer Code of Ethics (“Officer Code”) sets forth the policies, practices, and values expected to be exhibited in the conduct of the Principal Executive Officers and Principal Financial Officers of the investment companies (“Funds”) they serve (“Covered Officers”). A list of Covered Officers and Funds is included on Appendix A.

The Boards of the Funds listed on Appendix A have elected to implement the Officer Code, pursuant to Section 406 of the Sarbanes-Oxley Act of 2002 and the SEC’s rules thereunder, to promote and demonstrate honest and ethical conduct in their Covered Officers.

Deutsche Asset Management, Inc. or its affiliates (“DeAM”) serves as the investment adviser to each Fund. All Covered Officers are also employees of DeAM or an affiliate. Thus, in addition to adhering to the Officer Code, these individuals must comply with DeAM policies and procedures, such as the DeAM Code of Ethics governing personal trading activities, as adopted pursuant to Rule 17j-1 under the Investment Company Act of 1940.¹ In addition, such individuals also must comply with other applicable Fund policies and procedures.

The DeAM Compliance Officer, who shall not be a Covered Officer and who shall serve as such subject to the approval of the Fund’s Board (or committee thereof), is primarily responsible for implementing and enforcing this Code. The Compliance Officer has the authority to interpret this Officer Code and its applicability to particular circumstances. Any questions about the Officer Code should be directed to the DeAM Compliance Officer.

The DeAM Compliance Officer and his or her contact information can be found in Appendix A.

 

II. Purposes of the Officer Code

The purposes of the Officer Code are to deter wrongdoing and to:

• promote honest and ethical conduct among Covered Officers, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships;

• promote full, fair, accurate, timely and understandable disclosures in reports and documents that the Funds file with or submit to the SEC (and in other public communications from the Funds) and that are within the Covered Officer’s responsibilities;

• promote compliance with applicable laws, rules and regulations;

• encourage the prompt internal reporting of violations of the Officer Code to the DeAM Compliance Officer; and

• establish accountability for adherence to the Officer Code.

_________________________

¹ The obligations imposed by the Officer Code are separate from, and in addition to, any obligations imposed under codes of ethics adopted pursuant to Rule 17j-1 under the Investment Company Act of 1940, and any other code of conduct applicable to Covered Officers in whatever capacity they serve. The Officer Code does not incorporate any of those other codes and, accordingly, violations of those codes will not necessarily be considered violations of the Officer Code and waivers granted under those codes would not necessarily require a waiver to be granted under this Code. Sanctions imposed under those codes may be considered in determining appropriate sanctions for any violation of this Code.

Any questions about the Officer Code should be referred to DeAM’s Compliance Officer.

 

III. Responsibilities of Covered Officers

 

A. Honest and Ethical Conduct

It is the duty of every Covered Officer to encourage and demonstrate honest and ethical conduct, as well as adhere to and require adherence to the Officer Code and any other applicable policies and procedures designed to promote this behavior. Covered Officers must at all times conduct themselves with integrity and distinction, putting first the interests of the Fund(s) they serve. Covered Officers must be honest and candid while maintaining confidentiality of information where required by law, DeAM policy or Fund policy.

Covered Officers also must, at all times, act in good faith, responsibly and with due care, competence and diligence, without misrepresenting or being misleading about material facts or allowing their independent judgment to be subordinated. Covered Officers also should maintain skills appropriate and necessary for the performance of their duties for the Fund(s). Covered Officers also must responsibly use and control all Fund assets and resources entrusted to them.

Covered Officers may not retaliate against others for, or otherwise discourage the reporting of, actual or apparent violations of the Officer Code or applicable laws or regulations. Covered Officers should create an environment that encourages the exchange of information, including concerns of the type that this Code is designed to address.

 

B. Conflicts of Interest

A “conflict of interest” occurs when a Covered Officer’s personal interests interfere with the interests of the Fund for which he or she serves as an officer. Covered Officers may not improperly use their position with a Fund for personal or private gain to themselves, their family, or any other person. Similarly, Covered Officers may not use their personal influence or personal relationships to influence decisions or other Fund business or operational matters where they would benefit personally at the Fund’s expense or to the Fund’s detriment. Covered Officers may not cause the Fund to take action, or refrain from taking action, for their personal benefit at the Fund’s expense or to the Fund’s detriment. Some examples of conflicts of interest follow (this is not an all-inclusive list): being in the position of supervising, reviewing or having any influence on the job evaluation, pay or benefit of any immediate family member who is an employee of a Fund service provider or is otherwise associated with the Fund; or having an ownership interest in, or having any consulting or employment relationship with, any Fund service provider other than DeAM or its affiliates.

Certain conflicts of interest covered by this Code arise out of the relationships between Covered Officers and the Fund that already are subject to conflict of interest provisions in the Investment Company Act and the Investment Advisers Act. For example, Covered Officers may not individually engage in certain transactions (such as the purchase or sale of securities or other property) with the Fund because of their status as “affiliated persons” of the Fund. Covered Officers must comply with applicable laws and regulations. Therefore, any violations of existing statutory and regulatory prohibitions on individual behavior could be considered a violation of this Code.

As to conflicts arising from, or as a result of the advisory relationship (or any other relationships) between the Fund and DeAM, of which the Covered Officers are also officers or employees, it is recognized by the Board that, subject to DeAM’s fiduciary duties to the Fund, the Covered Officers will in the normal course of their duties (whether formally for the Fund or for DeAM, or for both) be involved in establishing policies and implementing decisions which will have different effects on DeAM and the Fund. The Board recognizes that the participation of the Covered Officers in such activities is inherent in the contract relationship between the Fund and DeAM, and is consistent with the expectation of the Board of the performance by the Covered Officers of their duties as officers of the Fund.

Covered Officers should avoid actual conflicts of interest, and appearances of conflicts of interest, between the Covered Officer’s duties to the Fund and his or her personal interests beyond those contemplated or anticipated by applicable regulatory schemes. If a Covered Officer suspects or knows of a conflict or an appearance of one, the Covered Officer must immediately report the matter to the DeAM Compliance Officer. If a Covered Officer, in lieu of reporting such a matter to the DeAM Compliance Officer, may report the matter directly to the Fund’s Board (or committee thereof), as appropriate (e.g., if the conflict involves the DeAM Compliance Officer or the Covered Officer reasonably believes it would be futile to report the matter to the DeAM Compliance Officer).

When actual, apparent or suspected conflicts of interest arise in connection with a Covered Officer, DeAM personnel aware of the matter should promptly contact the DeAM Compliance Officer. There will be no reprisal or retaliation against the person reporting the matter.

Upon receipt of a report of a possible conflict, the DeAM Compliance Officer will take steps to determine whether a conflict exists. In so doing, the DeAM Compliance Officer may take any actions he or she determines to be appropriate in his or her sole discretion and may use all reasonable resources, including retaining or engaging legal counsel, accounting firms or other consultants, subject to applicable law.² The costs associated with such actions may be borne by the Fund, if appropriate, after consultation with the Fund’s Board (or committee thereof). Otherwise, such costs will be borne by DeAM or other appropriate Fund service provider.

After full review of a report of a possible conflict of interest, the DeAM Compliance Officer may determine that no conflict or reasonable appearance of a conflict exists. If, however, the DeAM Compliance Officer determines that an actual conflict exists, the Compliance Officer will resolve the conflict solely in the interests of the Fund, and will report the conflict and its resolution to the Fund’s Board (or committee thereof). If the DeAM Compliance Officer determines that the appearance of a conflict exists, the DeAM Compliance Officer will take appropriate steps to remedy such appearance. In lieu of determining whether a conflict exists and/or resolving a conflict, the DeAM Compliance Officer instead may refer the matter to the Fund’s Board (or committee thereof), as appropriate. However, the DeAM Compliance Officer must refer the matter to the Fund’s Board (or committee thereof) if the DeAM Compliance Officer is directly involved in the conflict or under similar appropriate circumstances.

After responding to a report of a possible conflict of interest, the DeAM Compliance Officer will discuss the matter with the person reporting it (and with the Covered Officer at issue, if different) for purposes of educating those involved on conflicts of interests (including how to detect and avoid them, if appropriate).

_________________________

² For example, retaining a Fund’s independent accounting firm may require pre-approval by the Fund’s audit committee.

Appropriate resolution of conflicts may restrict the personal activities of the Covered Officer and/or his family, friends or other persons.

Solely because a conflict is disclosed to the DeAM Compliance Officer (and/or the Board or Committee thereof) and/or resolved by the DeAM Compliance Officer does not mean that the conflict or its resolution constitutes a waiver from the Code’s requirements.

Any questions about conflicts of interests, including whether a particular situation might be a conflict or an appearance of one, should be directed to the DeAM Compliance Officer.

 

C. Use of Personal Fund Shareholder Information

A Covered Officer may not use or disclose personal information about Fund shareholders, except in the performance of his or her duties for the Fund. Each Covered Officer also must abide by the Funds’ and DeAM’s privacy policies under SEC Regulation S-P.

 

D. Public Communications

In connection with his or her responsibilities for or involvement with a Fund’s public communications and disclosure documents (e.g., shareholder reports, registration statements, press releases), each Covered Officer must provide information to Fund service providers (within the DeAM organization or otherwise) and to the Fund’s Board (and any committees thereof), independent auditors, government regulators and self-regulatory organizations that is fair, accurate, complete, objective, relevant, timely and understandable.

Further, within the scope of their duties, Covered Officers having direct or supervisory authority over Fund disclosure documents or other public Fund communications will, to the extent appropriate within their area of responsibility, endeavor to ensure full, fair, timely, accurate and understandable disclosure in Fund disclosure documents. Such Covered Officers will oversee, or appoint others to oversee, processes for the timely and accurate creation and review of all public reports and regulatory filings. Within the scope of his or her responsibilities as a Covered Officer, each Covered Officer also will familiarize himself or herself with the disclosure requirements applicable to the Fund, as well as the business and financial operations of the Fund. Each Covered Officer also will adhere to, and will promote adherence to, applicable disclosure controls, processes and procedures, including DeAM’s Disclosure Controls and Procedures, which govern the process by which Fund disclosure documents are created and reviewed.

To the extent that Covered Officers participate in the creation of a Fund’s books or records, they must do so in a way that promotes the accuracy, fairness and timeliness of those records.

 

E. Compliance with Applicable Laws, Rules and Regulations

In connection with his or her duties and within the scope of his or her responsibilities as a Covered Officer, each Covered Officer must comply with governmental laws, rules and regulations, accounting standards, and Fund policies/procedures that apply to his or her role, responsibilities and duties with respect to the Funds (“Applicable Laws”). These requirements do not impose on Covered Officers any additional substantive duties. Additionally, Covered Officers should promote compliance with Applicable Laws.

If a Covered Officer knows of any material violations of Applicable Laws or suspects that such a violation may have occurred, the Covered Officer is expected to promptly report the matter to the DeAM Compliance Officer.

 

IV. Violation Reporting

 

A. Overview

Each Covered Officer must promptly report to the DeAM Compliance Officer, and promote the reporting of, any known or suspected violations of the Officer Code. Failure to report a violation may be a violation of the Officer Code.

Examples of violations of the Officer Code include, but are not limited to, the following:

• Unethical or dishonest behavior

• Obvious lack of adherence to policies surrounding review and approval of public communications and regulatory filings

• Failure to report violations of the Officer Code

• Known or obvious deviations from Applicable Laws

• Failure to acknowledge and certify adherence to the Officer Code

The DeAM Compliance Officer has the authority to take any and all action he or she considers appropriate in his or her sole discretion to investigate known or suspected Code violations, including consulting with the Fund’s Board, the independent Board members, a Board committee, the Fund’s legal counsel and/or counsel to the independent Board members. The Compliance Officer also has the authority to use all reasonable resources to investigate violations, including retaining or engaging legal counsel, accounting firms or other consultants, subject to applicable law.³ The costs associated with such actions may be borne by the Fund, if appropriate, after consultation with the Fund’s Board (or committee thereof). Otherwise, such costs will be borne by DeAM.

 

B. How to Report

Any known or suspected violations of the Officer Code must be promptly reported to the DeAM Compliance Officer.

 

C. Process for Violation Reporting to the Fund Board

The DeAM Compliance Officer will promptly report any violations of the Code to the Fund’s Board (or committee thereof).

 

D. Sanctions for Code Violations

Violations of the Code will be taken seriously. In response to reported or otherwise known violations, DeAM and the relevant Fund’s Board may impose sanctions within the scope of their respective authority over the Covered Officer at issue. Sanctions imposed by DeAM could include termination of employment. Sanctions imposed by a Fund’s Board could include termination of association with the Fund.

_________________________

³ For example, retaining a Fund’s independent accounting firm may require pre-approval by the Fund’s audit committee.

 

V. Waivers from the Officer Code

A Covered Officer may request a waiver from the Officer Code by transmitting a written request for a waiver to the DeAM Compliance Officer.⁴ The request must include the rationale for the request and must explain how the waiver would be in furtherance of the standards of conduct described in and underlying purposes of the Officer Code. The DeAM Compliance Officer will present this information to the Fund’s Board (or committee thereof). The Board (or committee) will determine whether to grant the requested waiver. If the Board (or committee) grants the requested waiver, the DeAM Compliance Officer thereafter will monitor the activities subject to the waiver, as appropriate, and will promptly report to the Fund’s Board (or committee thereof) regarding such activities, as appropriate.

The DeAM Compliance Officer will coordinate and facilitate any required public disclosures of any waivers granted or any implicit waivers.

 

VI. Amendments to the Code

The DeAM Compliance Officer will review the Officer Code from time to time for its continued appropriateness and will propose any amendments to the Fund’s Board (or committee thereof) on a timely basis. In addition, the Board (or committee thereof) will review the Officer Code at least annually for its continued appropriateness and may amend the Code as necessary or appropriate.

The DeAM Compliance Officer will coordinate and facilitate any required public disclosures of Code amendments.

 

VII. Acknowledgement and Certification of Adherence to the Officer Code

Each Covered Officer must sign a statement upon appointment as a Covered Officer and annually thereafter acknowledging that he or she has received and read the Officer Code, as amended or updated, and confirming that he or she has complied with it (see Appendix B: Acknowledgement and Certification of Obligations Under the Officer Code).

Understanding and complying with the Officer Code and truthfully completing the Acknowledgement and Certification Form is each Covered Officer’s obligation.

The DeAM Compliance Officer will maintain such Acknowledgements in the Fund’s books and records.

VIII. Scope of Responsibilities

A Covered Officer’s responsibilities under the Officer Code are limited to:

_________________________

⁴ Of course, it is not a waiver of the Officer Code if the Fund’s Board (or committee thereof) determines that a matter is not a deviation from the Officer Code’s requirements or is otherwise not covered by the Code.

(1) Fund matters over which the Officer has direct responsibility or control, matters in which the Officer routinely participates, and matters with which the Officer is otherwise involved (i.e., matters within the scope of the Covered Officer’s responsibilities as a Fund officer); and

(2) Fund matters of which the Officer has actual knowledge.

 

IX. Recordkeeping

The DeAM Compliance Officer will create and maintain appropriate records regarding the implementation and operation of the Officer Code, including records relating to conflicts of interest determinations and investigations of possible Code violations.

 

X. Confidentiality

All reports and records prepared or maintained pursuant to this Officer Code shall be considered confidential and shall be maintained and protected accordingly. Except as otherwise required by law or this Officer Code, such matters shall not be disclosed to anyone other than the DeAM Compliance Officer, the Fund’s Board (or committee thereof), legal counsel, independent auditors, and any consultants engaged by the Compliance Officer.

Appendices

Appendix A:

List of Officers Covered under the Code, by Board:

Fund Board	Principal Executive Officers	Principal Financial Officers	Treasurer
DWS Funds	Michael Clark	Paul Schubert	Paul Schubert
Germany*	Michael Clark	Paul Schubert	Paul Schubert

* Central Europe and Russia, European Equity, and New Germany Funds

DeAM Compliance Officer:

Joseph S. Yuen

Code of Ethics Compliance

212-454-7443

212-454-4703 fax

As of: Jan 1, 2009

Appendix B: Acknowledgement and Certification

Initial Acknowledgement and Certification

of Obligations Under the Officer Code

Print Name Department Location Telephone

1. I acknowledge and certify that I am a Covered Officer under the DWS Investments Principal Executive and Financial Officer Code of Ethics (“Officer Code”), and therefore subject to all of its requirements and provisions.

2. I have received and read the Officer Code and I understand the requirements and provisions set forth in the Officer Code.

3. I have disclosed any conflicts of interest of which I am aware to the DeAM Compliance Officer.

4. I will act in the best interest of the Funds for which I serve as an officer and have maintained the confidentiality of personal information about Fund shareholders.

5. I will report any known or suspected violations of the Officer Code in a timely manner to the DeAM Compliance Officer.

___________________________________________________________________________________

SignatureDate

Annual Acknowledgement and Certification

of Obligations Under the Officer Code

Print Name Department Location Telephone

1. I acknowledge and certify that I am a Covered Officer under the DWS Investments Principal Executive and Financial Officer Code of Ethics (“Officer Code”), and therefore subject to all of its requirements and provisions.

2. I have received and read the Officer Code, and I understand the requirements and provisions set forth in the Officer Code.

3. I have adhered to the Officer Code.

4. I have not knowingly been a party to any conflict of interest, nor have I had actual knowledge about actual or apparent conflicts of interest that I did not report to the DeAM Compliance Officer in accordance with the Officer Code’s requirements.

5. I have acted in the best interest of the Funds for which I serve as an officer and have maintained the confidentiality of personal information about Fund shareholders.

6. With respect to the duties I perform for the Fund as a Fund officer, I believe that effective processes are in place to create and file public reports and documents in accordance with applicable regulations.

7. With respect to the duties I perform for the Fund as a Fund officer, I have complied to the best of my knowledge with all Applicable Laws (as that term is defined in the Officer Code) and have appropriately monitored those persons under my supervision for compliance with Applicable Laws.

8. I have reported any known or suspected violations of the Officer Code in a timely manner to the DeAM Compliance Officer.

Signature Date

Appendix C: Definitions

Principal Executive Officer

Individual holding the office of President of the Fund or series of Funds, or a person performing a similar function.

Principal Financial Officer

Individual holding the office of Treasurer of the Fund or series of Funds, or a person performing a similar function.

Registered Investment Management Investment Company

Registered investment companies other than a face-amount certificate company or a unit investment trust.

Waiver

A waiver is an approval of an exemption from a Code requirement.

Implicit Waiver

An implicit waiver is the failure to take action within a reasonable period of time regarding a material departure from a requirement or provision of the Officer Code that has been made known to the DeAM Compliance Officer or the Fund’s Board (or committee thereof).

EX-99.CERT

President

Form N-CSR Certification under Sarbanes Oxley Act

I, Michael G. Clark, certify that:

1. I have reviewed this report, filed on behalf of DWS Short Duration Fund, a series of DWS Advisor Funds, on Form N-CSR;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

December 30, 2009	/s/Michael G. Clark
	Michael G. Clark
	President
	DWS Short Duration Fund, a series of DWS Advisor Funds

Chief Financial Officer and Treasurer

Form N-CSR Certification under Sarbanes Oxley Act

I, Paul Schubert, certify that:

1. I have reviewed this report, filed on behalf of DWS Short Duration Fund, a series of DWS Advisor Funds, on Form N-CSR;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

December 30, 2009	/s/Paul Schubert
	Paul Schubert
	Chief Financial Officer and Treasurer
	DWS Short Duration Fund, a series of DWS Advisor Funds