Regulatory Update

As previously reported in the press, a number of private lawsuits have
been filed including purported class action and derivative lawsuits,
making various allegations and naming as defendants various persons,
including certain Scudder funds, Deutsche Asset Management ("DeAM") and
its affiliates, certain individuals, including in some cases Fund
Trustees, and other parties.  against Deutsche Asset Management and its
affiliates, including the investment advisor of your fund, and certain
Scudder funds and other related parties.  The following actions have
been filed concerning alleged illegal or improper practices relating to
market timing, revenue sharing or the pricing of fund shares.  DeAM has
undertaken to bear all liabilities and expenses incurred by the Scudder
funds in connection with these lawsuits, or other lawsuits or
regulatory actions that may be filed making allegations similar to
these lawsuits regarding fund valuation, market timing, revenue sharing
or other subjects of the pending inquires.  Based on currently
available information, DeAM believes that the likelihood that the
pending lawsuits will have a material adverse financial impact on a
Scudder fund is remote and such actions are not likely to materially
affect its ability to perform under its investment management
agreements with the Scudder funds.

The following purported class action lawsuits have been filed:
(1) On September 16, 2003, in the Circuit Court for Madison County,
Illinois entitled Potter v. Janus Investment Fund, et al.  Defendants
include, among others, Deutsche Investment Management Americas
("DIMA"), Inc. and Scudder International Fund.  (2) On January 22,
2004, in the United States District Court for the Southern District of
New York entitled Smith v. Scudder 21st Century Growth Fund, et al.
Defendants include, among others, Deutsche Bank AG ("DB AG"), Deutsche
Asset Management, Inc. ("DeAM"), DIMA, Inc., Scudder Investments, and
Scudder funds.  (3) On January 23, 2004, in the United States District
Court for the Southern District of New York entitled Malone v. Scudder
21st Century Growth Fund, et al.  Defendants include, among others, DB
AG, DeAM, Inc., DIMA, Inc., Scudder Investments, and Scudder Funds.
(4) On January 26, 2004, in the United States District Court for the
Southern District of New York entitled Driscoll v. DB AG, et al.
Defendants include, among others, DB AG, DeAM, Inc., DIMA, Inc.,
Scudder Investments, and Scudder funds.  (5) On January 29, 2004, in
the United States District Court for the Southern District of New York
entitled Atassi v. Scudder 21st Century Growth Fund, et al.  Defendants
include, among others, DB AG, DeAM, Inc., DIMA, Inc., Scudder
Investments, and Scudder funds.  (6) On February 10, 2004, in the
United States District Court for the Southern District of New York
entitled Walker v. Scudder 21st Century Growth Fund, et al.  Defendants
include, among others, DB AG, DeAM, Inc., DIMA, Inc., Scudder
Investments, and Scudder funds.  (7) On February 12, 2004, in the
United States District Court for the Southern District of New York
entitled McKenna v. Scudder 21st Century Growth Fund, et al.
Defendants include, among others, DB AG, DeAM, Inc., DIMA, Inc.,
Scudder Investments, and Scudder funds.  (8) On February 18, 2004, in
the United States District Court for the Southern District of New York
entitled Atassi v. Scudder 21st Century Growth Fund, et al.  Defendants
include, among others, DB AG, DeAM, Inc., DIMA, Inc., Scudder
Investments, and Scudder funds.  (9) On February 25, 2004, a lawsuit in
the United States District Court for the Southern District of New York
entitled Chin v. Scudder 21st Century Growth Fund, et al.  Defendants
include, among others, DB AG, DeAM, Inc., DIMA, Inc., Scudder
Investments, and Scudder funds.  (10) On February 25, 2004, in the
United States District Court for the Southern District of New York
entitled Doiron v. Scudder Advisor Funds, et al.  Defendants include,
among others, DB AG, DeAM, Inc., DIMA, Inc., Scudder Investments, and
Scudder funds.  (11) On March 17, 2004, in the United States District
Court for the Southern District of New York entitled Chorne v. Scudder
21st Century Growth Fund, et al.  Defendants include, among others, DB
AG, DeAM, Inc., DIMA, Inc., Scudder Investments, and Scudder funds.
(12) On March 18, 2004, in the United States District Court for the
Southern District of New York entitled Mocock v. Scudder 21st Century
Growth Fund, et al.  Defendants include, among others, DB AG, DeAM,
Inc., DIMA, Inc., Scudder Investments, and Scudder funds.

The following derivative lawsuits have been filed:
(1) On February 2, 2004, in the United States District Court for the
Eastern District of New York entitled Hinton v. DB AG, et al.
Defendants include, among others, DB AG, DeAM, Inc., DIMA, Inc.,
Scudder Investments, certain Directors/Trustees of the Scudder funds,
and the CEO of DIMA, Inc. (2) On March 3, 2004, in the United States
District Court for the Eastern District of New York entitled Weiser v.
DB AG, et al.  Defendants include, among others, DB AG, DeAM, Inc.,
DIMA, Inc., Scudder Investments, certain Directors/Trustees of the
Scudder funds, and the CEO of DIMA, Inc.  (3) On March 5, 2004, in the
United States District Court for the Eastern District of New York
entitled Clark v. DB AG, et al.  Defendants include, among others, DB
AG, DeAM, Inc., DIMA, Inc., Scudder Investments, certain
Directors/Trustees of the Scudder funds, and the CEO of DIMA, Inc.  (4)
On June 7, 2004, in the United States District Court for the District
of Delaware entitled Persall v. DeAM, Inc.  Defendants include, among
others, DeAM, Inc., DIMA, Inc., and certain Directors/Trustees of the
Scudder funds.

The following combined purported class action and derivative lawsuit
has been filed include: (1) On March 10, 2004, in the United States
District Court for the Southern District of New York entitled Walker v.
DB AG, et al.  Defendants include, among others, DB AG, DeAM, Inc.,
DIMA, Inc., Scudder Investments, and certain Directors/Trustees of the
Scudder funds.  (2) On May 6, 2004, in the United States District Court
for the Southern District of New York entitled Mazza v. DB AG, et al.
Defendants include, among others, DB AG, DeAM, Inc., DIMA, Inc.,
Scudder Investments, and certain Directors/Trustees of the Scudder
funds.