-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Tr7+5RGSHhwytfPRnL+ns3IPPrh2HakU/Qolr5PpMe774qJPuxIHC8O5pO2jEiBP /PX3NqjiYuT5IM60+GdWsQ== 0000935069-96-000128.txt : 19961106 0000935069-96-000128.hdr.sgml : 19961106 ACCESSION NUMBER: 0000935069-96-000128 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19960831 FILED AS OF DATE: 19961104 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: RBB FUND INC CENTRAL INDEX KEY: 0000831114 STANDARD INDUSTRIAL CLASSIFICATION: [] FISCAL YEAR END: 0831 FILING VALUES: FORM TYPE: N-30D SEC ACT: 1940 Act SEC FILE NUMBER: 811-05518 FILM NUMBER: 96653782 BUSINESS ADDRESS: STREET 1: 400 BELLEVUE PKWY STE 100 CITY: WILMINGTON STATE: DE ZIP: 19809 BUSINESS PHONE: 3027911791 MAIL ADDRESS: STREET 1: 103 BELLEVUE PKWY STREET 2: SUITE 152 CITY: WILMINGTON STATE: DE ZIP: 19809 FORMER COMPANY: FORMER CONFORMED NAME: FUND INC /DE/ DATE OF NAME CHANGE: 19600201 N-30D 1 BRADFORD MUNICIPAL MM PORTFOLIO ANNUAL REPORT BRADFORD MUNICIPAL MONEY MARKET PORTFOLIO J.C. Bradford & Co. [LOGO OMITTED] Annual Report August 31, 1996 BRADFORD MUNICIPAL MONEY MARKET SHARES THE RBB FUND, INC. ANNUAL INVESTMENT ADVISER'S REPORT Although this summer's weather remained on the cool side, the debate over Federal Reserve monetary policy became quite heated as the year progressed. By early July, a majority of Fed watchers were convinced that a rise in short-term interest rates was imminent, and pointed to July's strong employment report as evidence. The only question seemed to be the size and timing of the Fed's move. Would the Fed wait until its August meeting, or would they immediately raise the funds rate 25 or 50 basis points? Certainly, they pointed out, the jump in nonfarm payroll (+700,000 jobs) and the spike in hourly earnings (+9 cents) was cause for immediate action by the Fed to curb the economy and prevent a rekindling of inflation. However, as has often happened this year, economic reports that seemed to suggest either a business expansion or a slowdown were followed quite closely by reports that suggested otherwise. It seemed that after the winter's government shut downs and snowstorms, the predictability of economic numbers became a lost art in 1996. This same type of reversal of expectations occurred again in July following the strong jobs report. Within only a few weeks, signs of slower economic activity had tempered the certainty of a rate hike, and by the time Alan Greenspan spoke at his Humphrey-Hawkins testimony, he speculated that, "looking forward, there are a number of reasons to expect demands to moderate and economic activity to settle back toward a more sustainable pace in the months ahead." The Federal Reserve's forecast for growth is 2.5%-2.75% this year, falling to 1.75%-2.25% next year; while inflation should average about 3.0%-3.25% this year, and 2.75%-3.0% next year. Greenspan's remarks were very well received by the markets, and stocks and bonds rose sharply into early August. In addition, the expectation of higher short-term interest rates eased considerably, and by the time the Fed met on August 20, there was almost no one in the "tighter" camp. Short-term taxable interest rates have held steady at 5.25% (federal funds rate) for the last two quarters. The Federal Reserve's last move was on January 31, when they eased monetary policy to encourage economic growth, following news of a very weak fourth quarter 1995. At that time, market sentiment was biased towards additional easings of monetary policy and the short-term yield curve offered no incentive to extend. By mid-April, however, strong jobs reports worried the markets that the Fed would not only stop easing but might consider tightening. In response, the yield curve turned positive and rewarded longer average maturities with yield pick ups of 20-30 basis points. The Money Market and Government portfolios took advantage of this opportunity by moving their maturities to the 50-60 day range. For much of the last two quarters, investments of 3-12 months have outyielded overnight rates by 25-50 basis points. In the short-term municipal market, the usually predictable pattern of seasonal influences was interrupted this year by the federal budget impasse last winter, the possibility of changes to the tax code and volatility in the stock and bond markets. As in the taxable market, sentiment leaned towards higher rates, but the short-term municipal yield curve remained stubbornly flat. Yields on daily demand notes fluctuated widely during the year, between 2%-4%, depending on the day, month and level of supply versus demand. In June, for example, as supply fell, demand notes rose to yields over 4%, but as supply reentered the market in July, yields fell to 2.35%. By the end of August, New York City, California and Texas were all settling large new issues. The Municipal Portfolio took advantage of these new offerings to extend its average weighted maturity to the 50-day range. As always, all the Fund's portfolios emphasized high quality securities and highly liquid structures, in addition to providing competitive daily returns. Our credit research department employs fifteen professionals to approve and monitor the creditworthiness of every issue/issuer in which the portfolios invest. Finally, as of the date of this report, there are a number of proposed amendments to Rule 2a-7, the regulations which govern money market funds.The anticipated effective date of October 3 has been postponed by the SEC. We are following the situation closely and will be reporting to you in the future about the substance and timing of those changes. PNC Institutional Management Corporation (Please dial toll-free 800-533-7719 for questions regarding your account or contact your broker.) REPORT OF INDEPENDENT ACCOUNTANTS To the Shareholders and Board of Directors of The RBB Fund, Inc.: We have audited the accompanying statements of net assets of the Municipal Money Market Portfolio of The RBB Fund, Inc., as of August 31, 1996, and the related statement of operations for the year then ended, the statement of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the periods presented. These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of investments held by the custodian and brokers as of August 31, 1996. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the Municipal Money Market Portfolio of The RBB Fund, Inc. as of August 31, 1996 and the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and its financial highlights for each of the periods presented, in conformity with generally accepted accounting principles. COOPERS & LYBRAND L.L.P. 2400 Eleven Penn Center Philadelphia, Pennsylvania October 15, 1996 2 BRADFORD MUNICIPAL MONEY MARKET SHARES THE RBB FUND, INC. MUNICIPAL MONEY MARKET PORTFOLIO STATEMENT OF NET ASSETS AUGUST 31, 1996 PAR (000) VALUE ------- ---------- MUNICIPAL BONDS--99.8% ALABAMA--0.7% Alabama Special Care Facilities Authority St. Vincent's Daughters of Charity MB(AA, Aa)(DOUBLE DAGGER) 4.000% 11/01/96 ....................... $ 1,735 $1,736,028 Livingston IDR Toin Corp USA Project DN / (Ind. Bank of Japan LOC) [A-1+, VMIG-1](DAGGER) 4.150% 09/07/96 ....................... 1,000 1,000,000 ---------- 2,736,028 ---------- ALASKA--0.5% Alaska Industrial Development & Export Authority RB Series 1984-5 (LOC-Seattle First National Bank) DN [A-1](DAGGER) 3.600% 09/07/96 ....................... 2,045 2,045,000 ---------- ARIZONA--1.8% Flagstaff IDA DN / (LOC-Wells Fargo) [A, A-1](DAGGER) 3.550% 09/07/96 ....................... 7,755 7,755,000 ---------- ARKANSAS--0.4% Arkansas State Development Authority Health Care Facility Sisters of Mercy DN/ (ABM-AMRO Bank N.V. LOC) [A-1+, VMIG-1](DAGGER) 3.450% 09/07/96 ....................... 1,700 1,700,000 ---------- CALIFORNIA--14.8% California Pollution Control DN / (Society General LOC) [A-1+](DAGGER) 3.150% 09/30/96 ....................... 2,000 2,000,000 California Pollution Control Finance Authority (Pacific Gas & Electric Co. Project) Series 1996 C DN (Bank of America LOC) [A-1+](DAGGER) 3.850% 09/07/96 ....................... 8,200 8,200,000 Los Angeles County Housing Authority Malibu Meadows Project Series A DN (LOC- Sumitomo Bank) [A-1](DAGGER) 3.500% 09/07/96 ....................... 4,100 4,100,000 PAR (000) VALUE ------- ----------- CALIFORNIA--(CONTINUED) Los Angeles County Series 1996 A TRAN (Credit Suisse LOC) [SP-1+, MIG-1](DOUBLE DAGGER) 4.500% 06/30/97 .............................. $10,315 $10,371,569 Oakland (LOC- Natwest PLC) DN(DAGGER) 3.750% 09/07/96 .............................. 11,600 11,600,000 San Bernardino County TRAN / (Landesbank Hessen- Thuringen LOC) [SP-1+, MIG-1] 4.500% 06/30/97 .............................. 5,000 5,024,890 Southeast Resource Recovery Facility Authority Lease RB DN [A-1, VMIG-1](DAGGER) 3.550% 09/07/96 .............................. 7,500 7,500,000 State of California 1996-97 RAN [SP-1+, MIG-1] 4.500% 06/30/97 .............................. 7,000 7,029,519 State of California RAN Series C-5 / (Bank of America LOC) [A-1+, MIG] 3.850% 09/07/96 .............................. 1,000 1,000,000 Washington Township Hospital District Alemeda County DN / (Ind. Bank of Japan LOC)(DAGGER) 3.450% 09/07/96 .............................. 5,300 5,300,000 ----------- 62,125,978 ----------- COLORADO--1.8% Colorado State General Fund Revenue Series 1996 A TRAN [SP-1+, MIG-1] 4.500% 06/27/97 .............................. 5,000 5,025,623 Moffat County DN [A-1+, P-1](DAGGER) 3.550% 09/07/96 .............................. 2,400 2,400,000 ----------- 7,425,623 ----------- CONNECTICUT--0.7% Connecticut State of Special Assessment Unemployment Compensation Advance Fund Revenue (Connecticut Unemployment Project) Series 1993 C MB (FGIC Insurance) [A-1+, VMIG-1](DOUBLE DAGGER) 3.900% 07/01/97 .............................. 3,000 3,000,000 ----------- See Accompanying Notes to Financial Statements. 3 BRADFORD MUNICIPAL MONEY MARKET SHARES THE RBB FUND, INC. MUNICIPAL MONEY MARKET PORTFOLIO STATEMENT OF NET ASSETS (CONTINUED) AUGUST 31, 1996 PAR (000) VALUE ------- ----------- DELAWARE--0.7% The Delaware Economic Development Authority Gas Facilities Refunding (Delmarva Power & Light Project) Series 1993 C (Delmarva Power & Light Corporate Obligation) RB DN [VMIG-1](DAGGER) 3.650% 09/07/96 ......................... $ 3,000 $ 3,000,000 ----------- FLORIDA--1.4% Florida Housing Finance Agency DN / (Wells Fargo Bank LOC) [A-1](DAGGER) 3.850% 09/30/96 ......................... 3,000 3,000,000 Indian River County Hospital District Sunhealth Network MB / (Kredietbank LOC) [A-1+, VMIG-1](DOUBLE DAGGER) 3.700% 10/08/96 ......................... 3,000 3,000,000 ----------- 6,000,000 ----------- GEORGIA--3.6% Atlanta Urban Residential Finance Authority RB DN (Residential Construction -- Summerhill Project) / (First Union National Bank of North Carolina LOC) [A-1](DAGGER) 3.550% 09/07/96 ......................... 3,000 3,000,000 Brunswick and Glynn Development Authority Sewage Facility RB DN for Georgia-Pacific Corp. Project (LOC-Commerce Bank) Series 1996 [Aa2](DAGGER) 3.650% 09/07/96 ......................... 3,000 3,000,000 Carrollton Payroll Development Authority Certificates RAN [Aa3] 3.650% 09/07/96 ......................... 6,000 6,000,000 Forsyth County IDA RB for American Boa, Inc. Project (LOC- Dresdner Bank A.G.) DN(DAGGER) 3.550% 09/07/96 ......................... 3,000 3,000,000 ----------- 15,000,000 ----------- PAR (000) VALUE ------- ------------ ILLINOIS--8.8% Chicago O'Hare International Airport DN (American Airlines) Series C / (LOC- Royal Bank of Canada) [VMIG-1](DAGGER) 3.750% 09/01/96 ....................... $ 1,200 $ 1,200,000 Health Facility Authority DN (Central Health Care and Northwest Community Hospital) / (Sumitomo Bank LOC) [VMIG-1](DAGGER) 3.450% 09/07/96 ....................... 1,545 1,545,000 Illinois Development Finance Authority CHS Acquisition Corp. Project DN / (ABM-AMRO Bank N.V. LOC) [A-1+](DAGGER) 3.850% 09/07/96 ....................... 5,035 5,035,000 Illinois Development Finance Authority RB DN (Chicago Symphony Orchestra Project) / (Northern Trust LOC) [A-1, VMIG-1](DAGGER) 3.500% 09/07/96 ....................... 8,400 8,400,000 Illinois Health Facility Authority Carle Foundation Project DN / (Northern Trust LOC) [VMIG-1](DAGGER) 3.550% 09/07/96 ....................... 2,600 2,600,000 Illinois Housing Development Authority Multifamily Housing Bonds DN / (Landesbank Hessen-Thuringen LOC) [A-1+](DAGGER) 3.500% 09/07/96 ....................... 1,000 1,000,000 Illinois Housing Development Authority Series C-2 DN / (Society General LOC) [VMIG-1](DAGGER) 3.450% 09/03/96 ....................... 2,200 2,200,000 Illinois Student Loan Authority Community Student Loan RB DN / (Bank of America LOC) [VMIG-1](DAGGER) 3.600% 09/07/96 ....................... 7,800 7,800,000 O'Hare International Airport Special Facility RB DN / (Society General LOC) [Aa2, VMIG-1](DAGGER) 3.600% 09/07/96 ....................... 5,800 5,800,000 Southwestern Development Authority (Shell Oil Co. Wood River Project) Series 1995 MB [Aa2, VMIG-1](DOUBLE DAGGER) 3.950% 09/01/96 ....................... 1,375 1,375,000 ----------- 36,955,000 ----------- See Accompanying Notes to Financial Statements. 4 BRADFORD MUNICIPAL MONEY MARKET SHARES THE RBB FUND, INC. MUNICIPAL MONEY MARKET PORTFOLIO STATEMENT OF NET ASSETS (CONTINUED) AUGUST 31, 1996 PAR (000) VALUE ------- ---------- INDIANA--9.5% Bremen IDA RB Series 1996 A Universal Bearings, Inc. Project Private Placement DN / (Society National Bank of Cleveland LOC)(DAGGER) 3.800% 09/07/96 ........................ $ 5,000 $5,000,000 Indiana Development Finance Authority IDA RB DN (Enterprise Center I Project) / (LOC-Society National Bank of Cleveland) [A-1+](DAGGER) 3.800% 09/07/96 ........................ 2,900 2,900,000 Indiana Development Finance Authority IDA RB DN (Enterprise Center II, Project) / (LOC-Society National Bank of Cleveland) [A-1+](DAGGER) 3.800% 09/07/96 ........................ 5,000 5,000,000 Indiana Development Finance Authority IDA RB DN (Enterprise Center III Project) / (LOC-Society National Bank of Cleveland) [A-1+, AA-](DAGGER) 3.800% 09/07/96 ........................ 4,500 4,500,000 Indiana Development Finance Authority IDA RB DN (Enterprise Center IV Project) / (LOC-Society National Bank of Cleveland) [A-1+, AA-](DAGGER) 3.800% 09/07/96 ........................ 2,600 2,600,000 Indiana Health Facility Authority Daughters of Charity for St. Mary's Medical DN [AA, Aa](DAGGER) 4.000% 11/01/96 ........................ 840 840,497 La Porte County Economic Development RB DN (Pedcor Investments -- Woodland Crossing) / (Federal Home Loan Bank LOC) [VMIG-1, Aaa](DAGGER) 3.600% 09/07/96 ........................ 2,000 2,000,000 Orleans Economic Development RB for Almana Limited Liability Co. Project Series 1995 (LOC-National Bank of Detroit) DN(DAGGER) 3.650% 09/07/96 ........................ 5,400 5,400,000 Portage, City of Economic Development RB DN (Breckenridge Apartments Project) / (Comerica Bank Detroit LOC) [A-1](DAGGER) 3.650% 09/07/96 ........................ 4,650 4,650,000 PAR (000) VALUE ------- ----------- INDIANA--(CONTINUED) South Bend Redevelopment Authority (College Football Hall of Fame Project) Series DN (Fuji Bank LOC) [VMIG-1](DAGGER) 4.000% 09/07/96 ...................... $ 4,100 $ 4,100,000 Tippencanoe DN / (Bank of New York LOC) [Aa3, VMIG-1](DAGGER) 3.700% 09/07/96 ...................... 3,000 3,000,000 ----------- 39,990,497 ----------- IOWA--1.9% Iowa Finance Authority IDA RB DN (Sauer-Sundstrand Co. Project) / (Bayerische LB Girozentrale LOC) [P-1](DAGGER) 3.600% 09/07/96 ...................... 4,000 4,000,000 Iowa Finance Authority Tax-Exempt Adjustable Mode IDA RB DN (Dixie Bedding Co. Project) Series 1995 / (Wachovia LOC) [Aa2](DAGGER) 3.600% 09/07/96 ...................... 3,000 3,000,000 Osceola IDA RB (Babson Brothers Co. Projects) Series 1986 DN / (Bank of New York LOC) [VMIG-1](DAGGER) 3.700% 09/07/96 ...................... 1,100 1,100,000 ----------- 8,100,000 ----------- KANSAS--2.8% Burlington PCR RB MB (Kansas City Power & Light Company) / (Deutsche Bank LOC) [A-1+, P-1](DOUBLE DAGGER) 3.650% 10/10/96 ...................... 2,000 2,000,000 Butler County Solid Waste Disposal Facilities RB DN [VMIG-1, A1](DAGGER) 4.000% 09/07/96 ...................... 2,000 2,000,000 Lawrence County Project IDA RB Series A RAM Co. Project / (Wachovia LOC) [A-1+, VMIG-1](DAGGER) 3.600% 09/05/96 ...................... 2,125 2,125,000 Shawnee IDA RB Thrall Enterprises, Inc. Project DN (LOC-ABM-AMRO Bank N.V.)[A-1+](DAGGER) 3.900% 09/07/96 ...................... 5,700 5,700,000 ----------- 11,825,000 ----------- See Accompanying Notes to Financial Statements. 5 BRADFORD MUNICIPAL MONEY MARKET SHARES THE RBB FUND, INC. MUNICIPAL MONEY MARKET PORTFOLIO STATEMENT OF NET ASSETS (CONTINUED) AUGUST 31, 1996 PAR (000) VALUE ------- ----------- KENTUCKY--5.5% Clark County PCR RB MB (East Kentucky Power Cooperative, Inc.) [A-1+, VMIG-1](DOUBLE DAGGER) 3.400% 10/15/96 .......................... $ 2,000 $ 2,000,000 Hopkinsville IDA RB Douglas Autotech Corp. Project Series 1995 DN / (Ind. Bank of Japan LOC) [A, A-1](DAGGER) 4.150% 09/07/96 .......................... 7,700 7,700,000 Hopkinsville RB (American Precision Machinery) Series 1990 DN / (Mitsubishi Bank LOC) [VMIG-1](DAGGER) 3.650% 09/07/96 .......................... 3,600 3,600,000 Maysville, City of Solid Waste Disposal Facilities RB MB [A-1, P-1](DOUBLE DAGGER) 3.700% 09/12/96 .......................... 10,000 10,000,000 ----------- 23,300,000 ----------- LOUISIANA--3.4% Ascension Parish RB DN BASF Corp. [P-1, Aa3](DAGGER) 3.550% 09/07/96 .......................... 2,800 2,800,000 East Baton Rouge Mortgage Finance Authority MB Single Family Mortgage Purchase Bonds / (FNMA LOC) [VMIG-1](DOUBLE DAGGER) 3.400% 10/03/96 .......................... 2,910 2,910,000 East Baton Rouge Parish Pacific Corp. Project DN / (Ind. Bank of Japan LOC) [Aaa, VMIG-1](DAGGER) 3.850% 09/07/96 .......................... 6,500 6,500,000 Saint Charles PCR Series 1991 Shell Oil Co. DN [A-1+, VMIG-1](DAGGER) 3.950% 09/01/96 .......................... 1,900 1,900,000 ----------- 14,110,000 ----------- MARYLAND--3.2% Howard County Bluffs at Clary's Forest Apartment Facility Series 1995 DN / (FNB Maryland LOC) [A-1](DAGGER) 3.900% 09/07/96 .......................... 5,800 5,800,000 PAR (000) VALUE ------- ----------- MARYLAND--(CONTINUED) Maryland State Community Development Adminstration Department Single Family Housing Bonds Project -- 2nd Series MB [VMIG-1](DOUBLE DAGGER) 3.550% 10/01/96 ........................ $ 7,835 $ 7,835,000 ----------- 13,635,000 ----------- MICHIGAN--0.6% Michigan State Hospital Finance Authority Daughters of Charity MB [AA, Aa](DOUBLE DAGGER) 4.000% 11/01/96 ........................ 875 875,518 Michigan State Strategic Fund Limited Obligation RB DN / (Comerica Bank Detroit LOC) [A-1, P-1](DAGGER) 3.650% 09/07/96 ........................ 800 800,000 Northville IDA (Thrifty Northville Project) Series 1984 DN / (LOC-FNB Chicago) [P-1](DAGGER) 3.525% 09/07/96 ........................ 1,000 1,000,000 ----------- 2,675,518 ----------- MISSOURI--3.3% City of Berkeley IDA RB Exempt Facility DN (St. Louis Air Cargo Services, Inc. Project) / (LOC-Sumitomo Bank) [A-1](DAGGER) 3.750% 09/07/96 ........................ 5,200 5,200,000 City of Kansas IDA RB (Mid-America Health Services, Inc. Project) Series 1984 DN / (Bank of New York LOC) [A-1](DAGGER) 3.650% 09/07/96 ........................ 1,100 1,100,000 Kansas City IDA Demand Exempt Facility RB (K.C. Air Cargo Services, Inc. Project) DN / (LOC-Mellon Bank) [A-1](DAGGER) 3.750% 09/07/96 ........................ 7,600 7,600,000 ----------- 13,900,000 ----------- See Accompanying Notes to Financial Statements. 6 BRADFORD MUNICIPAL MONEY MARKET SHARES THE RBB FUND, INC. MUNICIPAL MONEY MARKET PORTFOLIO STATEMENT OF NET ASSETS (CONTINUED) AUGUST 31, 1996 PAR (000) VALUE ------- ----------- NEBRASKA--0.9% Lancaster Sun-Husker Foods, Inc. Project DN / (Bank of Tokyo LOC) [A-1+](DAGGER) 4.150% 09/07/96 ......................... $ 3,800 $ 3,800,000 ----------- NEVADA--0.9% Clark County Airport System Subordinate Lien RB DN Series 1995 A-2 / (Toronto Dominion LOC) [A-1+, VMIG-1](DAGGER) 3.600% 09/07/96 ......................... 1,680 1,680,000 Clark County IDA RB DN / (Swiss Bank LOC) [A-1+, VMIG-1](DAGGER) 3.950% 09/01/96 ......................... 2,300 2,300,000 ----------- 3,980,000 ----------- NEW HAMPSHIRE--4.8% Health and Higher Education Facility Authority Veteran Hospital Assoc. DN Series 1985 E / (AMBAC Insurance) [A-1+](DAGGER) 3.400% 09/07/96 ......................... 200 200,000 New Hampshire Higher Education & Health Facility DN (AMBAC Insurance) [A-1+, VMIG-1](DAGGER) 3.450% 09/07/96 ......................... 600 600,000 New Hampshire State Housing Finance Authority Multifamily RB Countryside Project DN / (General Electric Capital Corp. LOC) [VMIG-1](DAGGER) 3.650% 09/07/96 ......................... 14,700 14,700,000 New Hampshire State Housing Finance Authority Single Family Housing Bond MB / (FGIC Insurance) [VMIG-1](DOUBLE DAGGER) 3.650% 01/15/97 ......................... 4,500 4,500,000 ----------- 20,000,000 ----------- NORTH CAROLINA--0.1% Mecklenburg County Industrial Facility and Pollution Control Financing Authority (Edgcomb Metals Co. Project) Series 1984 DN / (Banque Nationale de Paris LOC)(DAGGER) 3.500% 09/07/96 ......................... 300 300,000 ----------- PAR (000) VALUE ------- ----------- NORTH DAKOTA--0.8% North Dakota Housing Finance Agency Housing Finance Program Bonds Home Mortgage Finance Program DN / (FGIC Insurance) [VMIG-1](DAGGER) 3.850% 04/03/97 ........................ $ 3,500 $ 3,500,000 ----------- OKLAHOMA--0.5% Oklahoma Development Finance Authority Shawnee Funding Limited DN / (Bank of Nova Scotia LOC)(DAGGER) 3.650% 09/07/96 ........................ 2,000 2,000,000 ----------- PUERTO RICO--0.1% Puerto Rico Industrial Medical Health Education and Environmental PCR (Anna G. Mendez Project) DN / (LOC-Bank of Tokyo) [A-1](DAGGER) 3.550% 09/07/96 ........................ 600 600,000 ----------- RHODE ISLAND--0.5% Rhode Island Housing & Mortgage Finance Corp. Convertible Home Ownership Opportunity Bonds Series 19 D MB / (Society General LOC) [A-1+, VMIG-1](DOUBLE DAGGER) 3.550% 01/30/97 ........................ 2,000 2,000,000 ----------- SOUTH CAROLINA--3.7% Anderson County IDA RB for Culp, Inc. Project DN / (Wachovia LOC)(DAGGER) 3.600% 09/07/96 ........................ 6,580 6,580,000 Marlboro County Solid Waste Disposal Facilities RB DN (Willamette Industries, Inc. Project) Series 1995 (LOC- Deutsche Bank A.G.) [A-1](DAGGER) 4.050% 09/07/96 ........................ 9,000 9,000,000 ----------- 15,580,000 ----------- TENNESSEE--2.5% Memphis General Improvement DN / (LOC-West Deutsche Landesbank) [A-1+, VMIG-1](DAGGER) 3.600% 09/07/96 ........................ 1,000 1,000,000 See Accompanying Notes to Financial Statements. 7 BRADFORD MUNICIPAL MONEY MARKET SHARES THE RBB FUND, INC. MUNICIPAL MONEY MARKET PORTFOLIO STATEMENT OF NET ASSETS (CONTINUED) AUGUST 31, 1996 PAR (000) VALUE ------- ----------- TENNESSEE--(CONTINUED) Metropolitan Nashville Airport Authority, Airport Improvement Series 1993 RB DN / (FGIC Insurance) [A-1+, VMIG-1](DAGGER) 3.500% 09/04/96 ...................... $ 1,100 $ 1,100,000 Montgomery County Public Building Authority County Loan Pool G.O. DN / (NCNB LOC) [A-1](DAGGER) 3.550% 09/07/96 ...................... 2,400 2,400,000 Oak Ridge Municipal Solid Waste Disposal Facility Bonds Series 1996 M4 Environmental Project DN / (Sunbank LOC)(DAGGER) 3.650% 09/07/96 ...................... 6,000 6,000,000 ----------- 10,500,000 ----------- TEXAS--6.9% Angelina and Neches River Authority Solid Waste Disposal RB MB [A-1, P-1](DOUBLE DAGGER) 3.800% 10/11/96 ...................... 5,300 5,300,000 Brazos River Harbor Navigation (Dow Chemical Co. Project) Series 1988 DN [P-1](DAGGER) 3.700% 10/11/96 ...................... 2,000 2,000,000 Harris County Health Facilities Development Corp. Hospital RB DN [A-1+](DAGGER) 3.750% 09/01/96 ...................... 7,200 7,200,000 San Antonio Housing Finance Corp. (Wellington Place Apartments) (LOC-Banc One) Series 1995 A DN [A-1+, AA](DAGGER) 3.600% 09/07/96 ...................... 3,000 3,000,000 State of Texas TAN [SP-1+, MIG] 4.750% 08/29/97 ...................... 7,000 7,053,017 Texas State Veterans Housing Authority MB(DOUBLE DAGGER) 3.900% 11/06/96 ...................... 4,000 4,000,000 Travis County Housing Finance Authority MB(DOUBLE DAGGER) 4.000% 11/01/96 ...................... 430 430,255 ----------- 28,983,272 ----------- PAR (000) VALUE ------- ----------- UTAH--2.0% Intermountain Power Agency Power Supply Refunding Series 1985 E (Spa- Bank of America) RB MB / (Morgan Guaranty LOC) [A-1, VMIG-1](DOUBLE DAGGER) 3.930% 06/16/97 .......................... $ 2,000 $2,000,000 Salt Lake Airport RB DN (LOC-Credit Suisse) [A-1+, VMIG-1](DAGGER) 3.450% 09/07/96 .......................... 2,300 2,300,000 Utah State Board of Regents Student Loan Revenue Series C RB DN / (Dresdner Bank LOC) [A-1+, VMIG-1](DAGGER) 3.550% 09/07/96 .......................... 3,400 3,400,000 Utah State Board of Regents Student Loan Revenue Series L RB DN / (Dresdner Bank LOC) [A-1+, VMIG-1](DAGGER) 3.550% 09/07/96 .......................... 900 900,000 ---------- 8,600,000 ---------- VERMONT--0.2% Vermont Educational & Health Buildings Agency Hospital RB (AMBAC Insurance) DN [A-1+, VMIG-1](DAGGER) 3.450% 09/07/96 .......................... 855 855,000 ---------- VIRGINIA--5.7% Alexandria IDA Adjustable Tender Resource Recovery (Alexandria/ Arlington Waste-to-Energy Facility) Series 1986 A DN / (Swiss Bank LOC) [VMIG-1, A-1+](DAGGER) 3.900% 09/01/96 .......................... 200 200,000 Alexandria Redevelopment & Housing Authority Multi-Family Housing Series A DN [A-1](DAGGER) 3.550% 09/07/96 .......................... 3,100 3,100,000 Capital Region Airport Commission (Richmond International Airport Project) Series 1995 B DN / (AMBAC Insurance ) [A-1+, VMIG-1](DAGGER) 3.300% 09/07/96 .......................... 1,700 1,700,000 Capital Region Airport Commission (Richmond International Airport Project) Series 1995 C DN / (AMBAC Insurance) [VMIG-1, A-1+](DAGGER) 3.450% 09/07/96 .......................... 2,500 2,500,000 See Accompanying Notes to Financial Statements. 8 BRADFORD MUNICIPAL MONEY MARKET SHARES THE RBB FUND, INC. MUNICIPAL MONEY MARKET PORTFOLIO STATEMENT OF NET ASSETS (CONTINUED) AUGUST 31, 1996 PAR (000) VALUE ------- ----------- VIRGINIA--(CONTINUED) Culpeper Town IDA Residential Care Facility RB DN / (NCNB LOC) [A-1](DAGGER) 3.550% 09/07/96 ......................... $ 500 $ 500,000 Fairfax County IDA DN Series 1988 C / (LOC-Credit Suisse) [A-1+](DAGGER) 3.650% 09/07/96 ......................... 200 200,000 King George County IDA (Birchwood Power Partners, L.P. Project) Series 1995 DN / (Credit Suisse LOC) [A-1+](DAGGER) 4.000% 09/07/96 ......................... 1,300 1,300,000 Louisa County IDA Pooled Financing Series 1995 DN (LOC-Nations Bank) [A-1](DAGGER) 3.500% 09/07/96 ......................... 2,500 2,500,000 Lynchburg Hospital RB Federal Housing Authority Mid-Atlantic Series 1985 E DN / (AMBAC Insurance) [A-1](DAGGER) 3.350% 09/07/96 ......................... 800 800,000 Lynchburg IDA Hospital Facilities (Mid-Atlantic States Capital Asset Finance Project) Series 1985 C DN / (AMBAC Insurance) [A-1+, VMIG-1](DAGGER) 3.350% 09/07/96 ......................... 500 500,000 Lynchburg IDA Hospital Facilities (Mid-Atlantic States Capital Asset Finance Project) Series 1985 G DN (AMBAC Insurance) [VMIG-1](DAGGER) 3.350% 09/07/96 ......................... 7,900 7,900,000 Peninsula Port Authority Port Facility (Shell Coal and Terminal Co.) Series 1987 DN (AMBAC Insurance) [Aaa, A-1+](DAGGER) 3.800% 09/01/96 ......................... 1,000 1,000,000 Peninsula Port Authority Dominion Terminal Series 1987 D MB / (Barclays Bank LOC) [A1+, P-1](DOUBLE DAGGER) 3.850% 09/01/96 ......................... 800 800,000 PAR (000) VALUE ------- ----------- VIRGINIA--(CONTINUED) Peninsula Port IDA RB (Allied Signal, Inc. Project) Series 1993 (Allied Signal Corp. Obligation) DN [A-1](DAGGER) 3.650% 09/07/96 ............................ $ 1,000 $ 1,000,000 ----------- 24,000,000 ----------- WASHINGTON--1.2% Port of Seattle IDA DN (Alaska Airlines Project) / (Bank of NY LOC) [A-1](DAGGER) 3.600% 09/07/96 ......................... 4,580 4,580,000 Washington State Adjustable Rate G.O. Bonds DN / (Landesbank Hessen LOC) [A-1+, VMIG-1](DAGGER) 3.500% 09/07/96 ......................... 400 400,000 ----------- 4,980,000 ----------- WEST VIRGINIA--2.5% Grant County Municipal Solid Waste MB [VMIG-1](DOUBLE DAGGER) 3.850% 09/10/96 ......................... 5,000 5,000,000 Marshall County IDA US/Canada Project DN / (Harris Trust & Savings Bank LOC) [A-1+, AA-](DAGGER) 3.650% 09/07/96 ......................... 3,500 3,500,000 West Virginia Hospital Finance Authority Hospital RB DN (VHA Mid-Atlantic States, Inc. Capital Asset) (AMBAC Insurance) [A-1+, VMIG-1](DAGGER) 3.450% 09/07/96 ......................... 600 1,200,000 West Virginia Hospital Finance Authority Hospital RB DN (Mid-Atlantic Capital Finance Project) Series 1985 C DN (AMBAC Insurance) [A-1+, VMIG-1](DAGGER) 3.450% 09/07/96 ......................... 700 700,000 ----------- 10,400,000 ----------- WISCONSIN--1.1% Carlton DN Wisconsin Power & Light Project [P-1](DAGGER) 3.600% 09/07/96 ......................... 4,800 4,800,000 ----------- See Accompanying Notes to Financial Statements. 9 BRADFORD MUNICIPAL MONEY MARKET SHARES THE RBB FUND, INC. MUNICIPAL MONEY MARKET PORTFOLIO STATEMENT OF NET ASSETS (CONCLUDED) AUGUST 31, 1996 VALUE ------------ TOTAL INVESTMENTS AT VALUE--99.8% (Cost $420,156,916*) $420,156,916 OTHER ASSETS IN EXCESS OF LIABILITIES--0.2% 731,430 ------------ NET ASSETS (Applicable to 202,009,609 Bedford shares 129,398,582 Bradford shares 115,765 Cash Preservation shares 89,426,172 Janney Montgomery Scott shares, 5,143 RBB shares and 800 other shares)--100.0% $420,888,346 ============ NET ASSET VALUE, offering and redemption price per share ($420,888,346 (DIVIDE) 420,956,071) $1.00 ===== * Also cost for Federal income tax purposes. (DAGGER) Variable Rate Demand Notes -- The interest rate shown is the rate as of August 31, 1996 and the maturity shown is the longer of the next interest readjustment date or the date the principal amount shown can be recovered through demand. (DOUBLE DAGGER) Put Bonds -- Maturity date is the put date. The Moody's Investor Service, Inc. and Standard and Poor's Ratings Group's ratings indicated are the most recent ratings available at August 31, 1996. These ratings have not been audited by the Independent Accountants, and, therefore, are not covered by the report of Independent Accountants. INVESTMENT ABBREVIATIONS BAN.................................Bond Anticipation Note DN.............................................Demand Note GO.....................................General Obligations LOC.......................................Letter of Credit IDA.......................Industrial Development Authority MB..........................................Municipal Bond PCR..............................Pollution Control Revenue RAN..............................Revenue Anticipation Note RAW..........................Revenue Anticipation Warrants RB............................................Revenue Bond TAN..................................Tax Anticipation Note TECP...........................Tax Exempt Commercial Paper TRAN.....................Tax and Revenue Anticipation Note See Accompanying Notes to Financial Statements. 10 BRADFORD MUNICIPAL MONEY MARKET SHARES THE RBB FUND, INC. MUNICIPAL MONEY MARKET PORTFOLIO STATEMENT OF OPERATIONS FOR THE YEAR ENDED AUGUST 31, 1996 Investment Income Interest ................................................... $15,900,230 ----------- Expenses Investment advisory fees ................................... 1,409,660 Administration fees ........................................ 428,209 Distribution fees .......................................... 2,427,986 Directors' fees ............................................ 7,715 Custodian fees ............................................. 88,191 Transfer agent fees ........................................ 291,739 Legal fees ................................................. 17,721 Audit fees ................................................. 12,514 Registration fees .......................................... 192,999 Insurance expense .......................................... 9,056 Printing fees .............................................. 72,100 Miscellaneous .............................................. 387 ----------- 4,958,277 Less fees waived ........................................... (1,236,642) Less expense reimbursement by advisor ...................... (17,576) ----------- Total expenses ........................................ 3,704,059 ----------- Net investment income ...................................... 12,196,171 ----------- Realized loss on investments ............................... (674) ----------- Net increase in net assets resulting from operations ....... $12,195,497 =========== See Accompanying Notes to Financial Statements. 11 BRADFORD MUNICIPAL MONEY MARKET SHARES THE RBB FUND, INC. MUNICIPAL MONEY MARKET PORTFOLIO STATEMENT OF CHANGES IN NET ASSETS
FOR THE FOR THE YEAR ENDED YEAR ENDED AUGUST 31, 1996 AUGUST 31, 1995 --------------- --------------- Increase (decrease) in net assets: Operations: Net investment income ............................................ $ 12,196,171 $ 9,691,756 Net gain (loss) on investments ................................... (674) 7,009 ------------ ------------ Net increase in net assets resulting from operations ............. 12,195,497 9,698,765 ------------ ------------ Distributions to shareholders: Dividends to shareholders from net investment income: Bedford shares ................................................... (5,960,711) (5,717,451) Bradford Shares .................................................. (3,611,114) (3,266,535) Cash Preservation shares ......................................... (3,746) (5,648) Janney Montgomery Scott shares ................................... (2,620,457) (701,975) RBB shares ....................................................... (143) (147) ------------ ------------ Total distributions to shareholders ............................ (12,196,171) (9,691,756) ------------ ------------ Net capital share transactions ..................................... (1,864,843) 140,043,103 ------------ ------------ Total increase (decrease) in net assets ............................ (1,865,517) 140,050,112 Net Assets: Beginning of year ................................................ 422,753,863 282,703,751 ------------ ------------ End of year ...................................................... $420,888,346 $422,753,863 ============ ============
See Accompanying Notes to Financial Statements. 12 BRADFORD MUNICIPAL MONEY MARKET SHARES THE RBB FUND, INC. MUNICIPAL MONEY MARKET PORTFOLIO FINANCIAL HIGHLIGHTS (c) (FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)
FOR THE PERIOD FOR THE FOR THE FOR THE FOR THE JANUARY 10, 1992 YEAR YEAR YEAR YEAR (COMMENCEMENT OF ENDED ENDED ENDED ENDED OPERATIONS) TO AUGUST 31, 1996 AUGUST 31, 1995 AUGUST 31, 1994 AUGUST 31, 1993 AUGUST 31, 1992 --------------- -------------- --------------- --------------- ---------------- Net asset value, beginning of period .... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 --------- --------- --------- -------- --------- Income from investment operations: Net investment income ................ 0.0288 0.0297 0.0195 0.0195 0.0154 --------- --------- --------- -------- --------- Total from investment operations ... 0.0288 0.0297 0.0195 0.0195 0.0154 --------- --------- --------- -------- --------- Less distributions Dividends (from net investment income) (0.0288) (0.0297) (0.0195) (0.0195) (0.0154) --------- --------- --------- -------- --------- Total distributions ................ (0.0288) (0.0297) (0.0195) (0.0195) (0.0154) --------- --------- --------- -------- --------- Net asset value, end of period .......... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ========= ========= ========= ======== ========= Total Return ............................ 2.92% 3.01% 1.97% 1.96% 2.42%(b) Ratios /Supplemental Data Net assets, end of period (000) ...... $ 129,399 $ 110,936 $ 100,089 $ 76,975 $ 69,586 Ratios of expenses to average net assets .......................... .84%(a) .82%(a) .77%(a) .77%(a) .77%(a)(b) Ratios of net investment income to average net assets ............... 2.88% 2.97% 1.95% 1.95% 2.40%(b) (a) Without the waiver of advisory fees and without the reimbursement of certain operating expenses, the ratios of expenses to average net assets would have been 1.12%, 1.14%, 1.11% and 1.16% for the years ended August 31, 1996, 1995, 1994 and 1993, respectively, and 1.16% annualized for the period ended August 31, 1992. (b) Annualized. (c) Financial Highlights relate soley to the Bradford Class of Shares within the portfolio.
See Accompanying Notes to Financial Statements. 13 BRADFORD MUNICIPAL MONEY MARKET SHARES THE RBB FUND, INC. MUNICIPAL MONEY MARKET PORTFOLIO NOTES TO FINANCIAL STATEMENTS AUGUST 31, 1996 NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The RBB Fund, Inc. (the "Fund") is registered under the Investment Company Act of 1940, as amended, as an open-end management investment company. The Fund was incorporated in Maryland on February 29, 1988. The Fund has authorized capital of thirty billion shares of common stock of which 12.35 billion shares are currently classified into sixty-six classes. Each class represents an interest in one of seventeen investment portfolios of the Fund. The classes have been grouped into fifteen separate "families", eight of which have begun investment operations: the RBB Family, the BEA Family, the Sansom Street Family, the Bedford Family, the Cash Preservation Family, the Janney Montgomery Scott Money Family, the n/i Family, and the Bradford Family. The Bradford Municipal Money Market Shares represent an interest in the Municipal Money Market Portfolio, which is covered in this report. A) SECURITY VALUATION -- Portfolio securities are valued under the amortized cost method, which approximates current market value. Under this method, securities are valued at cost when purchased and thereafter a constant proportionate amortization of any discount or premium is recorded until maturity of the security. Regular review and monitoring of the valuation is performed in an attempt to avoid dilution or other unfair results to shareholders. The Portfolio seeks to maintain net asset value per share at $1.00. B) SECURITY TRANSACTIONS AND INVESTMENT INCOME -- Security transactions are accounted for on the trade date. The cost of investments sold is determined by use of the specific identification method for both financial reporting and income tax purposes. Interest income is recorded on the accrual basis. Certain expenses, principally distribution, transfer agency and printing, are class specific expenses and vary by class. Expenses not directly attributable to a specific portfolio or class are allocated based on relative net assets of each portfolio and class, respectively. C) DISTRIBUTIONS TO SHAREHOLDERS -- Dividends from net investment income are declared daily and paid monthly. Any net realized capital gains are distributed at least annually. Income distributions and capital gain distributions are determined in accordance with income tax regulations which may differ from generally accepted accounting principles. D) FEDERAL INCOME TAXES -- No provision is made for Federal taxes as it is the Fund's intention to have the portfolio continue to qualify for and elect the tax treatment applicable to regulated investment companies under the Internal Revenue Code and make the requisite distributions to its shareholders which will be sufficient to relieve it from Federal income and excise taxes. E) USE OF ESTIMATES -- The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. 14 BRADFORD MUNICIPAL MONEY MARKET SHARES THE RBB FUND, INC. MUNICIPAL MONEY MARKET PORTFOLIO NOTES TO FINANCIAL STATEMENTS (CONTINUED) AUGUST 31, 1996 NOTE 2. TRANSACTIONS WITH AFFILIATES AND RELATED PARTIES Pursuant to an Investment Advisory Agreement, PNC Institutional Management Corp. ("PIMC"), a wholly owned subsidiary of PNC Asset Management Group, Inc., which is in turn a wholly owned subsidiary of PNC Bank, National Association ("PNC Bank"), serves as investment advisor for the portfolio described herein. PNC Bank serves as the sub-advisor for the Municipal Money Market Portfolio. For its advisory services, PIMC is entitled to receive the following fees, computed daily and payable monthly based on the portfolio's average daily net assets: .35% of first $250 million of net assets; .30% of next $250 million of net assets; .25% of net assets in excess of $500 million. PIMC may, at its discretion, voluntarily waive all or any portion of its advisory fee for this portfolio. For each class of shares within this portfolio, the net advisory fee charged to each class is the same on a relative basis. For the year ended August 31, 1996, advisory fees and waivers for the investment portfolio were as follows: GROSS NET ADVISORY ADVISORY FEE WAIVER FEE ---------- ------------ -------- $1,409,660 $ (1,218,973) $190,687 PNC Bank, as sub-advisor, receives a fee directly from PIMC, not the portfolio. In addition, PNC Bank serves as custodian for each of the Fund's portfolios. PFPC Inc. ("PFPC"), an indirect wholly owned subsidiary of PNC Bank Corp., serves as each class's transfer and dividend disbursing agent. PFPC may, at its discretion, voluntarily waive all or any portion of its transfer agency fee for any class of shares. For the year ended August 31, 1996, transfer agency fees and waivers for each class of shares within the investment portfolio were as follows:
GROSS NET TRANSFER AGENCY TRANSFER AGENCY FEE WAIVER FEE --------------- -------------- --------------- Bedford Class $ 104,373 $ -- $ 104,373 Bradford Class 59,772 -- 59,772 Cash Preservation Class 8,783 (8,303) 480 Janney Montgomery Scott Class 109,422 -- 109,422 RBB Class 9,389 (9,366) 23 --------- --------- --------- Total $ 291,739 $ (17,669) $ 274,070 ========= ========= =========
15 BRADFORD MUNICIPAL MONEY MARKET SHARES THE RBB FUND, INC. MUNICIPAL MONEY MARKET PORTFOLIO NOTES TO FINANCIAL STATEMENTS (CONTINUED) AUGUST 31, 1996 NOTE 2. TRANSACTIONS WITH AFFILIATES AND RELATED PARTIES (CONTINUED) In addition, PFPC serves as administrator for the Municipal Money Market Portfolio. The administration fee is computed daily and payable monthly at an annual rate of .10% of the Portfolio's average daily net assets. For the year ended August 31, 1996, administration fee for the portfolio was as $428,209. The Fund, on behalf of each class of shares within this portfolio, has adopted Distribution Plans pursuant to Rule 12b-1 under the Investment Company Act of 1940, as amended, and has entered into Distribution Contracts with Counsellors Securities Inc. ("Counsellors"), which provide for each class to make monthly payments based on average net assets, to Counsellors of up to .65% on an annualized basis for the Bedford, Bradford, Cash Preservation, Janney Montgomery Scott and RBB Classes and up to .20% on an annualized basis for the Sansom Street Class. For the year ended August 31, 1996, distribution fees for each class were as follows: DISTRIBUTION FEE -------------- Bedford Class $ 1,139,416 Bradford Class 723,264 Cash Preservation Class 531 Janney Montgomery Scott Class 564,754 RBB Class 21 ----------- Total $ 2,427,986 =========== The Fund has entered into service agreements with banks affiliated with PNC Bank who render support services to customers who are the beneficial owners of the Sansom Street Class in consideration of the payment of .10% of the daily net asset value of such shares. For the year ended August 31, 1996, there were no service organization fees for the Municipal Money Market Portfolio. 16 BRADFORD MUNICIPAL MONEY MARKET SHARES THE RBB FUND, INC. MUNICIPAL MONEY MARKET PORTFOLIO NOTES TO FINANCIAL STATEMENTS (CONTINUED) AUGUST 31, 1996 NOTE 3. CAPITAL SHARES Transactions in capital shares (at $1.00 per capital share) for each year were as follows:
MUNICIPAL MONEY MARKET PORTFOLIO ------------------------------------------ FOR THE FOR THE YEAR ENDED YEAR ENDED AUGUST 31, 1996 AUGUST 31, 1995 ---------------- --------------- VALUE VALUE -------------- -------------- Shares sold: Bedford Class $1,022,457,772 $1,104,088,188 Bradford Class 479,401,891 474,166,249 Cash Preservation Class 171,907 175,548 Janney Montgomery Scott Class 408,374,271 208,067,881 RBB Class 69,480 5,004 Shares issued in reinvestment of dividends: Bedford Class 5,847,767 5,576,408 Bradford Class 3,506,714 3,126,860 Cash Preservation Class 3,515 5,478 Janney Montgomery Scott Class 2,602,869 662,565 RBB Class 143 146 Shares repurchased: Bedford Class (1,024,790,222) (1,093,651,142) Bradford Class (464,445,579) (466,448,018) Cash Preservation Class (220,929) (220,601) Janney Montgomery Scott Class (434,775,023) (95,506,391) RBB Class (69,419) (5,072) -------------- -------------- Net increase (decrease) $ (1,864,843) $ 140,043,103 ============== ============== Bradford Shares authorized 500,000,000 500,000,000 ============== ==============
17 BRADFORD MUNICIPAL MONEY MARKET SHARES THE RBB FUND, INC. MUNICIPAL MONEY MARKET PORTFOLIO NOTES TO FINANCIAL STATEMENTS (CONTINUED) AUGUST 31, 1996 NOTE 4. NET ASSETS At August 31, 1996, net assets consisted of the following: MUNICIPAL MONEY MARKET PORTFOLIO ------------- Capital paid-in Bedford Class $ 202,009,609 Bradford Class 129,398,582 Cash Preservation Class 115,765 Janney Montgomery Scott Class 89,426,172 RBB Class 5,143 Other Classes 800 Accumulated net realized gain (loss) on investments Bedford Class (69,803) Bradford Class 339 Cash Preservation Class 5 Janney Montgomery Scott Class 1,734 RBB Class -- ------------- $ 420,888,346 ============= NOTE 5. CAPITAL LOSS CARRYOVERS At August 31, 1996, $67,725 capital loss carryovers were available to offset future realized gains of which $55,760 expires in 1999, $444 expires in 2000, $1,058 expires in 2001, $9,789 expires in 2002 and $674 expires in 2004. 18 BRADFORD MUNICIPAL MONEY MARKET SHARES THE RBB FUND, INC. MUNICIPAL MONEY MARKET PORTFOLIO NOTES TO FINANCIAL STATEMENTS (CONTINUED) AUGUST 31, 1996 NOTE 6. OTHER FINANCIAL HIGHLIGHTS The Fund currently offers four other classes of shares representing interests in the Municipal Money Market Portfolio: Bedford, Cash Preservation, Janney Montgomery Scott and RBB. Each class is marketed to different types of investors. Financial Highlights of the RBB and Cash Preservation classes are not presented in this report due to their immateriality. Such information is available in the annual reports of each respective family. The financial highlights of certain of the other classes are as follows: THE BEDFORD FAMILY
MUNICIPAL MONEY MARKET PORTFOLIO --------------------------------------------------------------------------------------- FOR THE FOR THE FOR THE FOR THE FOR THE YEAR YEAR YEAR YEAR YEAR ENDED ENDED ENDED ENDED ENDED AUGUST 31, 1996 AUGUST 31, 1995 AUGUST 31, 1994 AUGUST 31, 1993 AUGUST 31, 1992 --------------- --------------- --------------- --------------- --------------- Net asset value, beginning of year......... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 --------- --------- --------- --------- --------- Income from investment operations: Net investment income.................... 0.0288 0.0297 0.0195 0.0195 0.0287 Net gain on securities (both realized and unrealized) ........................ -- -- -- -- -- --------- --------- --------- --------- --------- Total from investment operations 0.0288 0.0297 0.0195 0.0195 0.0287 --------- --------- --------- --------- --------- Less distributions: Dividends (from net investment income)... (0.0288) (0.0297) (0.0195) (0.0195) (0.0287) Distributions (from capital gains)....... -- -- -- -- -- --------- --------- --------- --------- --------- Total distributions................... (0.0288) (0.0297) (0.0195) (0.0195) (0.0287) --------- --------- --------- --------- --------- Net asset value, end of year............... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ========= ========= ========= ========= ========= Total Return............................... 2.92% 3.01%(b) 1.97% 1.96% 2.90% Ratios /Supplemental Data Net assets, end of year (000)............ $ 201,940 $ 198,425 $ 182,480 $ 215,577 $ 176,950 Ratios of expenses to average net assets. .84%(a) .82%(a) .77%(a) .77%(a) .77%(a) Ratios of net investment income to average net assets .................... 2.88% 2.97% 1.95% 1.95% 2.87% (a) Without the waiver of advisory fees and without the reimbursement of certain operating expenses, the ratios of expenses average net assets for the Municipal Money Market Portfolio have been 1.12%, 1.14%, 1.12%, 1.16% and 1.15% for the years ended August 31, 1996, 1995, 1994, 1993 and 1992, respectively.
19 BRADFORD MUNICIPAL MONEY MARKET SHARES THE RBB FUND, INC. MUNICIPAL MONEY MARKET PORTFOLIO NOTES TO FINANCIAL STATEMENTS (CONCLUDED) AUGUST 31, 1996 NOTE 6. OTHER FINANCIAL HIGHLIGHTS (CONTINUED) THE JANNEY MONTGOMERY SCOTT FAMILY
MUNICIPAL MONEY MARKET PORTFOLIO --------------------------------- FOR THE PERIOD JUNE 12, 1995 FOR THE (COMMENCEMENT OF YEAR ENDED OPERATIONS) TO AUGUST 31, 1996 AUGUST 31, 1995 --------------- ---------------- Net asset value, beginning of period ........................... $ 1.00 $ 1.00 --------- ----------- Income from investment operations: Net investment income ........................................ 0.0278 0.0063 --------- ----------- Total from investment operations ............................. 0.0278 0.0063 --------- ----------- Less distributions Dividends (from net investment income) ....................... (0.0278) (0.0063) --------- ----------- Total distributions .......................................... (0.0278) (0.0063) --------- ----------- Net asset value, end of period ................................. $ 1.00 $ 1.00 ========= =========== Total Return ................................................... 2.81% 2.87%(b) Ratios /Supplemental Data Net assets, end of period (000) .............................. $ 89,428 $ 113,226 Ratios of expenses to average net assets ..................... 0.94%(a) 1.00%(a)(b) Ratios of net investment income to average net assets ........ 2.78% 2.83%(b) (a) Without the waiver of advisory fees and without the reimbursement of certain operating expenses to average net assets for the Municipal Money Market Portfolio would have been 1.23% for the year ended August 31, 1996 and 1.30% annualized for the period ended August 31, 1995. (b) Annualized.
20 TAX INFORMATION FOR SHAREHOLDERS (UNAUDITED) In the twelve months ended August 31, 1996 (the end of the Fund's fiscal year), 100% of the dividends paid by the Municipal Money Market Portfolio were exempt-interest dividends for purposes of federal income taxes and free from such taxes. However, approximately 47% of such dividends was attributable to interest on private activity bonds which must be included in federal alternative minimum taxable income for the purpose of determining liability for federal alternative minimum tax. In January 1997, you will be furnished with a schedule showing the yearly percentage breakdown by state or U.S. possession of the source of interest earned by the Municipal Money Market Portfolio in 1996. It is suggested that you consult your tax adviser concerning the applicability of state and local taxes to dividends paid by the Fund during the year. 21 [THIS PAGE INTENTIONALLY LEFT BLANK] -----END PRIVACY-ENHANCED MESSAGE-----