-----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, GtJE+r7VBpKc9MMMGHuOblGw8Dtupnh5JcTrz/ds0Kf/5OxK37a4B5CwVE+pjVsq HCAtjTFoJ1by4IMk2gypOQ== 0000916641-96-000825.txt : 19961003 0000916641-96-000825.hdr.sgml : 19961003 ACCESSION NUMBER: 0000916641-96-000825 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19960731 FILED AS OF DATE: 19961002 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: CASH RESOURCE TRUST /MA/ CENTRAL INDEX KEY: 0000908920 STANDARD INDUSTRIAL CLASSIFICATION: [] STATE OF INCORPORATION: MA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: N-30D SEC ACT: 1940 Act SEC FILE NUMBER: 811-07862 FILM NUMBER: 96638317 BUSINESS ADDRESS: STREET 1: RIVERFRONT PLAZA, WEST TOWER STREET 2: 901 E. BYRD STREET CITY: RICHMOND STATE: VA ZIP: 23219 BUSINESS PHONE: 8047823294 MAIL ADDRESS: STREET 1: RIVERFRONT PLAZA, WEST TOWER STREET 2: 901 E BYRD STREET CITY: RICHMOND STATE: VA ZIP: 23219 FORMER COMPANY: FORMER CONFORMED NAME: IMG MONEY MARKET SERIES TRUST DATE OF NAME CHANGE: 19930709 N-30D 1 MENTOR CASH RESOURCE TRUST ANNUAL REPORT CASH RESOURCE TRUST Annual Report July 31, 1996 [MENTOR INVESTMENT GROUP LOGO] Cash Resource Trust Annual Report July 31, 1996 Message from the Chairman and President It is our privilege to send you the Cash Resource Trust Annual Report for the year ended July 31, 1996. The Cash Resource Trust is part of a diversified family of funds offered by Mentor Investment Group, an investment advisory firm with more than $6 billion under management. Mentor provides investment management in seven different styles to a broad spectrum of investors. As you know, the CRT Money Market Funds are invested to seek as high a rate of current income (or, in the case of the Cash Resource Tax-Exempt Money Market Fund, as high a rate of current income exempt from federal income tax) as the investment advisor believes is consistent with preservation of capital and maintenance of liquidity. The Funds are managed according to a conservative policy that places strong emphasis on credit research. We carefully review each investment and do not sacrifice quality to attain a higher yield. In the pages that follow you will find financial statements for the Cash Resource Money Market Fund, the Cash Resource U.S. Government Money Market Fund, and the Cash Resource Tax-Exempt Money Market Fund, in addition to commentary from members of the management team regarding their investment strategy and outlook. We thank you for your continuing investment in our Funds. We appreciate your confidence in our commitment to providing current income consistent with preservation of capital and maintenance of liquidity. Sincerely, /s/ DANIEL J. LUDEMAN /s/ PAUL F. COSTELLO Daniel J. Ludeman Paul F. Costello Chairman President The Mentor Mission Statement Our mission is to provide professional investment management services through a firm that is second to none in the quality of its investment process, the skill and training of its professionals, and the commitment, shared by all its associates, to deliver the highest level of service and ethical behavior to clients. For more information and a prospectus for the Cash Resource Trust, please call us, (800)382-0016, or contact your financial consultant. The prospectus contains complete information regarding advisory fees, sales charges, and expenses. Please read them carefully before investing or sending money. 1 PAGE Cash Resource Trust Annual Report Managers' Overview July 31, 1996 The three funds of the Cash Resource Trust (CRT) are invested in accordance with conservative standards which place primary emphasis on liquidity and safety of principal. * The CRT Money Market Fund is a diversified portfolio of fixed-income securities, including commercial paper, bank obligations, and other short-term investments. * The CRT U.S. Government Money Market Fund is invested entirely in securities backed by the U.S. Government or its agencies, and related repurchase agreements. * The CRT Tax-Exempt Money Market Fund is structured to generate income exempt from federal income tax. The 12-month period ended July 31, 1996 was one of mixed signals for money managers. The period began August 1, 1995 with the Federal Reserve having just lowered the key Fed Funds rate to 5.75%, the first reduction in two years. The next four months witnessed a mixed pattern of economic data, with the economy apparently poised for strong growth but frustrated by a sluggish consumer. During this period the markets tended to vacillate within a relatively narrow trading range based on whether the latest statistics were weak or strong. But the preponderance of evidence indicated a soft economy, with the result that the Fed further reduced rates, to 5.50% in December and 5.25% in January. It now appears, however, that the data for the winter months were distorted, first by the partial government shutdown, then by bad weather, and were not as weak as first reported. The coming of spring brought a more positive growth track for the economy, with the result that sentiment shifted 180 degrees, away from further cuts by the Fed and toward a return to the pattern of higher rates prevailing in the previous fiscal year. The fixed-income markets sold off sharply in response to this change in expectations, with rates rising. The money market area was no exception. The remainder of the year appears more uncertain than usual, with the course of the economy and Fed policy somewhat open to question, particularly with presidential elections taking place. Our pledge to you is to continue our emphasis on safety and liquidity through high credit standards and conservative investment policies. We thank you for your investment. /s/ R. PRESTON NUTTALL R. Preston Nuttall Director of Cash Management /s/ HUBERT R. WHITE Hubert R. White Portfolio Manager /s/ KATHRYN T. ALLEN Kathryn T. Allen Portfolio Manager 2 Cash Resource Trust Money Market Fund Portfolio of Investments July 31, 1996 (In thousands)
Percent of Principal Value Net Assets Amount (Note 2) Bankers Acceptances 5.98% Nationsbank Corporation, 5.39%, 8/07/96 $14,000 $ 13,987 Nationsbank of Texas, 5.31%, 11/15/96 5,000 4,922 Wachovia Bank, 5.42%, 10/29/96 20,000 19,732 Total Bankers Acceptances 38,641 Bank Notes 6.18% Bank of America, 5.54%, 10/15/96 20,000 20,000 First of America, 4.98%, 12/19/96 20,000 19,956 Total Bank Notes 39,956 Certificates of Deposit 3.09% First Alabama Bank, 5.37%, 8/05/96 5,000 5,000 First Alabama Bank, 5.47%, 9/09/96 15,000 15,000 Total Certificates of Deposit 20,000 Commercial Paper 65.96% Apparel & Accessory Stores 3.08% J.C. Penney Funding Corporation, 5.29%, 9/06/96 20,000 19,894 Asset Backed Securities 6.17% CIESCO Limited Partnership, 5.36%, 8/07/96 15,000 14,987 Greenwich Funding Corporation, 5.37%, 8/20/96 (a) 25,000 24,929 Total Asset Backed Securities 39,916 Commercial Banks 17.62% ABN-Amro North America Finance, Inc., 5.32%, 11/08/96 10,000 9,854 ABN-Amro North America Finance, Inc., 5.30%, 11/12/96 10,000 9,848 Abbey National North America, 5.29%, 11/20/96 20,000 19,674 Bank of New York, 5.42%, 9/24/96 20,000 19,837 Mellon Financial Company, 5.36%, 8/15/96 20,000 19,958 Nationsbank Corporation, 5.26%, 8/15/96 10,000 9,980 Svenska Handelsbanken, 5.50%, 10/09/96 25,000 24,736 Total Commercial Banks 113,887
3 Cash Resource Trust Money Market Fund Portfolio of Investments (continued) July 31, 1996 (In thousands)
Percent of Principal Value Net Assets Amount (Note 2) Commercial Paper (continued) Electric Services 4.97% National Rural Utilities, 5.37%, 8/19/96 $20,000 $ 19,946 Rincon Securities, Inc., 5.37%, 8/28/96 1,250 1,245 Rincon Securities, Inc., 5.35%, 9/06/96 5,000 4,973 Rincon Securities, Inc., 5.38%, 9/09/96 6,000 5,965 Total Electric Services 32,129 Insurance Agents, Brokers & Service 3.06% International Nederlanden, 5.42%, 10/21/96 10,000 9,878 International Nederlanden U.S. Insurance Holdings, Inc., 5.41%, 9/17/96 10,000 9,929 Total Insurance Agents, Brokers & Service 19,807 Metal Mining 3.86% North Financial, 5.40%, 8/13/96 25,000 24,955 Oil and Gas Field Exploration Services 1.54% Statoil, 5.30%, 8/28/96 10,000 9,960 Personal Credit Institutions 7.69% American Express, 5.30%, 8/21/96 20,000 19,941 Ford Motor Credit Company, 5.43%, 9/06/96 20,000 19,892 Ford Motor Credit Company, 5.42%, 10/17/96 10,000 9,884 Total Personal Credit Institutions 49,717 Rental & Leasing 3.04% General Electric Capital, 5.24%, 8/30/96 7,000 6,970 General Electric Capital, 5.35%, 1/21/97 13,000 12,666 Total Rental & Leasing 19,636 Security Brokers & Dealers 11.85% Bear Stearns Company, 5.40%, 9/13/96 20,000 19,871 CS First Boston, Inc., 5.33%, 8/27/96 17,000 16,935 CS First Boston, Inc., 5.40%, 9/11/96 10,000 9,939 Merrill Lynch & Company, Inc., 5.45%, 9/06/96 30,000 29,837 Total Security Brokers & Dealers 76,582
4 Cash Resource Trust Money Market Fund Portfolio of Investments (continued) July 31, 1996 (In thousands)
Percent of Principal Value Net Assets Amount (Note 2) Commercial Paper (continued) Tobacco Products 3.08% Philip Morris, 5.38%, 9/09/96 $20,000 $ 19,884 Total Commercial Paper 426,367 Corporate Obligations 2.32% Dupont E I De Nemours, 5.80%, 12/12/96 9,000 9,007 Walker & Associates, 5.54%, 07/01/11 (b) 6,000 6,000 Total Corporate Obligations 15,007 U.S. Government Securities and Agencies 7.75% U.S. Treasury Note, 7.50%, 01/31/97 10,000 10,109 Federal Home Loan Bank, 5.31%-5.67%, 12/23/96-2/14/97 (b) 15,000 15,000 Student Loan Marketing Association, 5.51%-5.54%, 11/24/97-2/22/99 (b) 25,000 24,998 Total U.S. Government Securities and Agencies 50,107 Repurchase Agreement 9.95% Goldman, Sachs & Company Dated 7/31/96, 5.65%, due 8/01/96, collateralized by $66,828 Federal National Mortgage Association, 7.50%, 3/01/26 64,345 64,345 Total Investments (cost $654,423) (d) 101.23% 654,423 Other Assets less Liabilities (1.23%) (7,923) Net Assets 100.00% $646,500
See notes to portfolios of investments. 5 Cash Resource Trust U.S. Government Money Market Fund Portfolio of Investments July 31, 1996 (In thousands)
Percent of Principal Value Net Assets Amount (Note 2) U.S. Government Securities and Agencies 59.65% Federal Home Loan Bank 5.22%-5.36%, 10/16/96-2/19/97 $ 133,340 $ 130,837 5.31%-5.54%, 2/14/97-2/16/99 (b) 42,000 42,000 Federal Home Loan Mortgage Corporation 5.25%-5.36%, 8/05/96-10/23/96 225,459 224,838 Federal National Mortgage Association 5.17%-5.37%, 8/09/96-10/24/96 234,700 232,912 Student Loan Marketing Association 5.51%-5.55%, 10/14/97-2/08/99 (b) 105,000 104,998 U.S. Treasury Notes 6.50%-7.50%, 11/30/96-1/31/97 100,000 100,962 Total U.S. Government Securities and Agencies 836,547 Repurchase Agreements 40.55% Chase Securities, Inc. Dated 7/31/96, 5.65%, due 8/01/96, collateralized by $61,596 Federal National Mortgage Association, 7.00%-9.00%, 3/01/25-6/01/26 60,000 60,000 First Union Corporation Dated 7/31/96, 5.66%, due 8/01/96, collateralized by $34,444 U.S. Treasury Notes, 11.25%, 2/15/15 50,000 50,000 Goldman, Sachs & Company Dated 7/31/96, 5.65%, due 8/01/96, collateralized by $185,618 Federal National Mortgage Association, 7.50%, 3/01/26 178,721 178,721 Lehman Brothers, Inc. Dated 7/31/96, 5.68%, due 8/01/96, collateralized by $57,716 Federal National Mortgage Association, 9.00%-9.50%, 5/01/22-3/01/25 60,000 60,000 Merrill Lynch, Pierce, Fenner & Smith, Inc. Dated 7/31/96, 5.69%, due 8/01/96, collateralized by $35,748 Federal Home Loan Mortgage Corporation 7.00%, 11/01/25 and $27,504 Federal National Mortgage Association 7.50%, 12/01/25 60,000 60,000
6 Cash Resource Trust U.S. Government Money Market Fund Portfolio of Investments (continued) July 31, 1996 (In thousands)
Percent of Principal Value Net Assets Amount (Note 2) Repurchase Agreements (continued) Paine Webber, Inc. Dated 7/31/96, 5.68%, due 8/01/96, collateralized by $43,420 Federal National Mortgage Association, 7.00%, 6/01/23 and $20,638 Government National Mortgage Association, 7.00%, 7/15/25 $ 60,000 $ 60,000 United Bank of Switzerland Dated 7/31/96, 5.68%, due 8/01/96, collateralized by $61,267 Federal Home Loan Mortgage Corporation, 6.50%-7.00%, 1/01/24-2/01/24 and $45,330 Federal National Mortgage Association-Strips, 6.50%-7.00%, 12/01/10-2/01/26 100,000 100,000 Total Repurchase Agreements 568,721 Total Investments (cost $1,405,268) (d) 100.20% 1,405,268 Other Assets less Liabilities (0.20%) (2,871) Net Assets 100.00% $1,402,397
See notes to portfolios of investments. 7 Cash Resource Trust Tax-Exempt Money Market Fund Portfolio of Investments July 31, 1996 (In thousands)
Percent of Principal Value Net Assets Amount (Note 2) Variable Rate Tax-Exempt Demand Securities (b) 43.53% Alabama 2.20% University of Alabama Board of Trustees, 3.60%, 10/01/13 $ 6,400 $ 6,400 Arizona 6.46% Apache County IDA Tucson Electric Power Company Project, 3.65%, 6/15/20 10,000 10,000 Coconino City Tuscon Gas & Electric Service PCR Series A, 3.70%, 5/01/31 8,800 8,800 18,800 Colorado 2.54% Colorado Housing Finance Authority Series 1985, 3.60%, 5/01/97 7,400 7,400 Illinois 4.51% Chicago O'Hare International Airport American Airlines Series 1983C, 3.70%, 1/01/18 2,000 2,000 Illinois DFA Grayhill, Inc. Project IDR, 3.75%, 2/01/05 3,150 3,150 Illinois DFA Flinn Scientific Project, 3.75%, 10/01/15 4,760 4,760 Illinois HFA West Suburban Hospital, 3.65%, 7/01/05 3,200 3,200 13,110 Maryland 4.44% Anne Arundel County Oakland Hills Project, 3.65%, 5/15/15 2,052 2,052 Howard County Revenue Bond, Harmony Hall, Inc. Project, 3.65%, 10/01/10 2,868 2,868 Maryland State Health & Higher Education, Series B, 3.65%, 4/01/35 8,000 8,000 12,920 Michigan 0.69% Michigan State Strategic Fund, 3.75%, 2/01/09 2,000 2,000
8 Cash Resource Trust Tax-Exempt Money Market Fund Portfolio of Investments (continued) July 31, 1996 (In thousands)
Percent of Principal Value Net Assets Amount (Note 2) Variable Rate Tax-Exempt Demand Securities (b) (continued) North Carolina 5.16% Durham County Water & Sewer, 3.65%, 12/01/15 $ 4,800 $ 4,800 Lincoln County Industrial Facility PCR Series 1994, 3.80%, 8/01/09 6,000 6,000 North Carolina Educational Facilities Bowman Grey School, 3.55%, 9/01/20 4,200 4,200 15,000 New Mexico 0.70% Albuquerque Greater Receipts Tax, 3.65%, 7/01/22 2,050 2,050 Tennessee 0.77% Nashville and Davidson County Health and Education Facility, 3.65%, 5/01/20 2,224 2,224 Texas 2.13% North Texas Higher Education Student Loan Revenue Refund, Series 1991F, 3.65%, 4/01/20 4,000 4,000 Panhandle Plains Student Loan Revenue Series A, 3.65%, 6/01/21 1,300 1,300 Texas Education Authority Series 1985B, 3.60%, 12/01/25 885 885 6,185 Virginia 11.39% Arlington County Ballston Public Parking, 3.60%, 8/01/17 3,650 3,650 Botetourt County IDR Emkay Holdings Project, 3.60%, 10/01/05 2,700 2,700 Capital Regional Airport Series 1995C, 3.70%, 7/01/23 4,000 4,000 Chesterfield County IDR Midlothian Hotel Partnership, 3.65%, 12/01/14 6,344 6,344 Hampton Roads Regional Jail Series 1996B, 3.60%, 7/01/16 4,000 4,000 Hanover County IDR Carter Machinery, 3.65%, 11/01/98 500 500
9 Cash Resource Trust Tax-Exempt Money Market Fund Portfolio of Investments (continued) July 31, 1996 (In thousands)
Percent of Principal Value Net Assets Amount (Note 2) Variable Rate Tax-Exempt Demand Securities (b) (continued) Virginia (continued) Henrico County IDA Hermitage Project, 3.60% -- 3.65%, 5/01/24 $ 3,700 $ 3,700 Lynchburg IDA Mid-Atlantic Series G, 3.55%, 12/01/25 500 500 Richmond IDB Commonwealth Park, 3.70%, 11/01/07 1,364 1,364 Roanoke IDR Quibell Corporate Project, 3.65%, 9/01/15 292 292 Spotsylvania City IDA Residential Care Facilities, 3.65%, 10/01/20 4,684 4,684 Tazewell County IDR, 4.00%, 1/01/03 1,000 1,000 Virginia Beach Revenue Bond, 3.65%, 9/01/09 410 410 33,144 Wisconsin 0.65% Village of Pleasant Prairie Muskie Enterprise Project, Series 1995, 3.75%, 5/01/15 1,900 1,900 Wyoming 1.89% Lincoln County Exxon Series B, 3.65%, 11/01/14 1,500 1,500 Sweetwater County PCR Pacific Corporation Project Series A, 3.50%, 7/01/15 4,000 4,000 5,500 Total Variable Rate Tax-Exempt Demand Securities 126,633 Other Tax-Exempt Securities 56.80% Alabama 0.95% IDB of Fairfield USX Corporation Project, Series 1995, 3.55%, 10/01/96 2,775 2,775 Arizona 0.17% Scottsdale IDA Memorial Hospital Series A, 3.70%, 9/01/96 485 485
10 Cash Resource Trust Tax-Exempt Money Market Fund Portfolio of Investments (continued) July 31, 1996 (In thousands)
Percent of Principal Value Net Assets Amount (Note 2) Other Tax-Exempt Securities (continued) Colorado 1.04% State of Colorado General Fund TRANS Series A, 4.50%, 6/27/97 $ 3,000 $ 3,017 Florida 3.61% City of Jacksonville Series A, 3.40%, 9/10/96 5,000 5,000 Putnam County Development Authority Seminole Electric Series 1984, 3.50%, 12/15/96 3,000 3,000 Sunshine State Government Finance Commission Series 1986 Revenue Bond, 3.60%, 10/17/96 2,500 2,500 10,500 Georgia 1.72% Dekalb County TRANS, 3.75%, 12/31/96 5,000 5,012 Illinois 2.99% Chicago Illinois GO Tender Note, 3.10%, 2/04/97 2,300 2,300 City of Chicago GO Tender Notes Series 1995A, 3.65%, 10/31/96 6,400 6,400 8,700 Kentucky 0.86% Pulaski County Solid Waste Project, Series B, 3.20%, 8/15/96 2,500 2,500 Louisiana 2.23% Plaquemines Port Harbor Series C, 3.70%, 10/22/96 6,500 6,500 Maryland 0.69% Baltimore City Public Improvement, 3.40%, 8/15/96 2,000 2,000 Michigan 2.75% State of Michigan GO Note RANS, 4.00%, 9/30/96 3,000 3,004 Michigan State, Underground Storage Tank Financial Assurance Series I, 3.45%, 8/15/96 5,000 5,000 8,004
11 Cash Resource Trust Tax-Exempt Money Market Fund Portfolio of Investments (continued) July 31, 1996 (In thousands)
Percent of Principal Value Net Assets Amount (Note 2) Other Tax-Exempt Securities (continued) Minnesota 1.43% Rochester Health Care Series C, 3.60%, 8/15/96 $ 3,010 $ 3,010 University of Minnesota Revenue Bond, 3.25%, 8/01/96 1,150 1,150 4,160 Mississippi 0.79% Claiborne County PCR, 3.50%, 9/24/96 2,300 2,300 North Carolina 7.87% North Carolina Power Agency Series B, 3.10%, 8/13/96 10,000 10,000 Wake County Industrial Facility Series 1990A, 3.70%-3.80%, 8/12/96-8/20/96 12,900 12,900 22,900 New York 1.04% New York City TRANS Series A, 4.50%, 2/12/97 3,000 3,012 South Carolina 4.47% York County PCR Series 1984N-3, 3.25%, 9/15/96 8,000 8,000 Beaufort County School District BANS Series 1995, 4.13%, 8/15/96 5,000 5,001 13,001 Texas 13.97% Brazos Harbor Industrial Development Series 1986, 3.65%, 8/22/96 3,700 3,700 Harris City Health Care, 3.40%, 9/09/96 5,000 5,000 Houston TRANS, 4.50%, 6/30/97 5,000 5,032 Houston Water & Sewer Series A, 3.40%, 8/28/96 8,000 8,000 San Antonio Electric & Gas Series A, 3.60%-3.70%, 8/14/96-8/23/96 10,900 10,900 State of Texas TRANS Series A, 4.75%, 8/30/96 8,000 8,004 40,636
12 Cash Resource Trust Tax-Exempt Money Market Fund Portfolio of Investments (continued) July 31, 1996 (In thousands)
Percent of Principal Value Net Assets Amount (Note 2) Other Tax-Exempt Securities (continued) Virginia 4.45% Chesterfield County GO Bond 5.25%, 8/01/96 $ 800 $ 800 Chesterfield County IDR Series 1987B 3.60%, 10/24/96 1,000 1,000 Peninsula Port Authority, 3.55%, 8/13/96 3,135 3,135 York County IDA PCR, 3.55%-3.65% 8/08/96-9/10/96 8,000 8,000 12,935 West Virginia 3.44% West Virginia HDA, 3.55%, 8/15/96 10,000 10,000 Other 2.33% PNC Municash, 3.46%, 8/01/96 6,790 6,790 Total Other Tax-Exempt Securities 165,227 Total Investments (cost $291,860) (d) 100.33% 291,860 Other Assets less Liabilities (0.33%) (969) Net Assets 100.00% $290,891
Investment Abbreviations BANS - Bond Anticipation Notes DFA - Development Finance Authority GO - General Obligation HDA - Housing Development Authority HFA - Housing Finance Authority IDA - Industrial Development Authority IDB - Industrial Development Board IDR - Industrial Development Revenue PCR - Pollution Control Revenue RANS - Revenue Anticipation Notes TRANS - Tax and Revenue Anticipation Notes Notes to Portfolios of Investments (a) These are securities that may be resold to qualified institutional buyers under Rule 144A or securities offered pursuant to section 4 (2) of the Securities Act of 1933, as amended. These securities have been determined to be liquid under guidelines that have been established by the Board of Trustees. (b) Floating Rate Securities -- The rates shown are the effective rates at July 31, 1996. (c) Interest rates represent annualized yield to date of maturity, except for variable rate securities described in (a). (d) For each security, cost (for financial reporting and federal income tax purposes) and carrying value are the same. See notes to financial statements. 13 Cash Resource Trust Statements of Assets and Liabilities July 31, 1996 (In thousands)
U.S. Money Government Tax-Exempt Market Money Market Money Market Fund Fund Fund Assets Investments, at amortized cost (Note 2) Investment securities $590,078 $ 836,547 $291,860 Repurchase agreements 64,345 568,721 - Total investments 654,423 1,405,268 291,860 Receivables Interest receivable 1,147 1,994 1,797 Shares of the portfolio sold 201 191 26 Investments sold - - 1,003 Deferred expenses (Note 2) 65 301 66 Other 371 - 74 Total assets 656,207 1,407,754 294,826 Liabilities Payables Dividends 1,346 2,766 355 Investments purchased - - 3,012 Shares of the portfolio redeemed 8,181 2,014 514 Accrued distribution fee (Note 3) 45 117 16 Accrued expenses and other liabilities 135 460 38 Total liabilities 9,707 5,357 3,935 Net Assets $646,500 $ 1,402,397 $290,891 Shares outstanding 646,500 1,402,450 290,894 Net asset value per share $ 1.00 $ 1.00 $ 1.00
See notes to financial statements. 14 Cash Resource Trust Statements of Operations Year Ended July 31, 1996 (In thousands)
Money U.S. Government Tax-Exempt Market Money Market Money Market Fund Fund Fund Investment income Interest $30,098 $73,399 $ 10,373 Expenses Distribution fee (Note 3) 2,043 5,016 948 Management fee (Note 3) 1,173 2,660 632 Transfer agent fee (Note 3) 758 2,943 304 Custodian and accounting fees (Note 3) 198 735 140 Shareholder reports 84 344 29 Registration fees 73 274 85 Professional fees 40 137 22 Organizational expenses 10 66 12 Directors' fees 6 22 5 Other 36 122 12 Total expenses 4,421 12,319 2,189 Net investment income 25,677 61,080 8,184 Net increase in net assets resulting from operations $25,677 $61,080 $ 8,184
See notes to financial statements. 15 Cash Resource Trust Statements of Changes in Net Assets (In thousands)
Money U.S. Government Tax-Exempt Market Money Market Money Market Fund Fund Fund Year Ended July 31, 1996 1995 1996 1995 1996 1995 Increase in Net Assets Operations Net investment income $ 25,677 $ 13,949 $ 61,080 $ 47,780 $ 8,184 $ 6,665 Net realized gain (loss) on investments sold - 4 - (53) - (3) Increase in net assets from operations 25,677 13,953 61,080 47,727 8,184 6,662 Distributions to Shareholders Net investment income (25,677) (13,949) (61,080) (47,780) (8,184) (6,665) Net realized gain on investments - (4) - - - - Net decrease from distributions (25,677) (13,953) (61,080) (47,780) (8,184) (6,665) Capital Share Transactions (at $1.00 per share) Net proceeds from sale of shares 3,001,684 1,715,060 5,769,658 4,322,307 1,194,000 1,029,842 Reinvestment of dividends 25,161 13,420 60,634 46,908 8,146 6,528 Cost of shares redeemed (2,803,002) (1,498,083) (5,644,585) (4,060,291) (1,178,150) (965,174) Change in net assets from capital share transactions 223,843 230,397 185,707 308,924 23,996 71,196 Net increase in net assets 223,843 230,397 185,707 308,871 23,996 71,193 Net Assets Beginning of year 422,657 192,260 1,216,690 907,819 266,895 195,702 End of year $ 646,500 $ 422,657 $ 1,402,397 $ 1,216,690 $ 290,891 $ 266,895
See notes to financial statements. 16 Cash Resource Trust Financial Highlights
Money Market Fund Year Year Period Ended Ended Ended 7/31/96 7/31/95 7/31/94* Per Share Operating Performance Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00 Income from investment operations Net investment income 0.05 0.05** 0.02 Distributions Net investment income (0.05) (0.05)** (0.02) Net asset value, end of period $ 1.00 $ 1.00 $ 1.00 Total Return 4.91% 4.97% 1.83%(b) Ratios / Supplemental Data Net assets, end of period (in thousands) $646,500 $422,657 $192,260 Ratio of expenses to average net assets 0.82% 0.82% 0.89%(a) Ratio of expenses to average net assets excluding waivers 0.82% 0.82% 0.93%(a) Ratio of net investment income to average net assets 4.77% 4.96% 2.96%(a)
(a) Annualized. (b) Total Return for periods less than one year are not annualized. * For the period from December 20, 1993 (commencement of operations) to July 31, 1994. ** Includes net realized capital gains (losses) which were under $0.01 per share. See notes to financial statements. 17 Cash Resource Trust Financial Highlights (continued)
U.S. Government Tax-Exempt Money Market Fund Money Market Fund Year Year Period Year Year Period Ended Ended Ended Ended Ended Ended 7/31/96 7/31/95 7/31/94* 7/31/96 7/31/95 7/31/94* Per Share Operating Performance Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 Income from investment operations Net investment income 0.05 0.05** 0.02 0.03 0.03** 0.01 Distributions Net investment income (0.05) (0.05) (0.02) (0.03) (0.03) (0.01) Net asset value, end of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 Total Return 4.74% 4.82% 1.82%(b) 2.90% 3.05% 1.16%(b) Ratios / Supplemental Data Net assets, end of period (in thousands) $1,402,397 $1,216,690 $907,819 $290,891 $266,895 $195,702 Ratio of expenses to average net assets 0.93% 0.88% 0.80%(a) 0.76% 0.72% 0.65%(a) Ratio of expenses to average net assets excluding waivers 0.93% 0.88% 0.83%(a) 0.76% 0.74% 0.74%(a) Ratio of net investment income to average net assets 4.63% 4.75% 2.91%(a) 2.85% 3.01% 1.87%(a)
(a) Annualized. (b) Total Return for periods less than one year are not annualized. * For the period from December 20, 1993 (commencement of operations) to July 31, 1994. ** Includes net realized capital gains (losses) which were under $0.01 per share. See notes to financial statements. 18 Cash Resource Trust Notes to Financial Statements July 31, 1996 Note 1: Organization Cash Resource Trust ("Trust") was organized on June 14, 1993 and is registered under the Investment Company Act of 1940, as amended, as an open-end management investment company. The Trust consists of three separate diversified funds (hereinafter each individually referred to as a "Fund" or collectively as the "Funds") at July 31, 1996 as follows: Cash Resource Money Market Fund ("Money Market Fund") Cash Resource U.S. Government Money Market Fund ("U.S. Government Fund") Cash Resource Tax-Exempt Money Market Fund ("Tax-Exempt Fund") The investment objective of each Fund is to seek current income consistent with preservation of capital and maintenance of liquidity. The assets of each Fund of the Trust are segregated and a shareholder's interest is limited to the Fund in which shares are held. Note 2: Significant Accounting Policies The following is a summary of significant accounting policies consistently followed by the Funds in the preparation of their financial statements. The policies are in conformity with generally accepted accounting principles which require management to make estimates and assumptions that affect amounts reported herein. Although actual results could differ from these estimates, any such differences are expected to be immaterial to the net assets of the Funds. A. Valuation of Securities Investments are stated at amortized cost, which approximates market value. In the event that a deviation of 1/2 of 1% or more exists between a Fund's $1.00 per share net asset value, calculated at amortized cost, and the net asset value calculated by reference to market-based values, or if there is any other deviation that the Board of Trustees believes would result in a material dilution to shareholders or purchasers, the Board of Trustees will promptly consider what action should be initiated. B. Repurchase Agreements It is the policy of the Trust to require the custodian bank to take possession, to have legally segregated in the Federal Reserve Book entry system, or to have segregated within the custodian bank's vault all securities held as collateral in support of repurchase agreement investments. Additionally, procedures have been established by the Trust to monitor, on a daily basis, the market value of each repurchase agreement's underlying securities to ensure the existence of a proper level of collateral. 19 Cash Resource Trust Notes to Financial Statements (continued) The Trust will only enter into repurchase agreements with banks and other recognized financial institutions such as broker/dealers which are deemed by the Trust's adviser to be creditworthy pursuant to guidelines established by the Board of Trustees. Risks may arise from the potential inability of counterparties to honor the terms of the repurchase agreement. Accordingly, the Trust could receive less than the repurchase price on the sale of collateral securities. C. Security Transactions and Interest Income Security transactions for the Funds are accounted for on a trade date basis. Interest income is recorded on the accrual basis and includes amortization of premium and discount on investments. D. Expenses Expenses arising in connection with a Fund are allocated to that Fund. Other Trust expenses are allocated among the Funds in proportion to their relative net assets. E. Fund Share Valuation and Dividends to Shareholders Fund shares are sold and redeemed on a continual basis at net asset value. The net asset value per share (NAV) of each Fund is determined daily as of 4:00 p.m. on each day that the New York Stock Exchange is open for trading. Each Fund determines its NAV by dividing the total value of the Fund's investments and other assets, less liabilities, by the number of Fund shares outstanding. Each Fund declares a daily dividend, equal to its net investment income for that day and payable at month end. Distributions from net realized capital gains, if any, are paid annually. F. Federal Income Taxes No provision for federal income taxes has been made since it is each Fund's policy to comply with the provisions applicable to regulated investment companies under the Internal Revenue Code and to distribute to its shareholders within the allowable time limit substantially all taxable income and realized capital gains. At July 31, 1996, U.S. Government Fund for federal tax purposes, had a capital loss carryforward of approximately $54,000. Pursuant to the Code, such capital loss carryforwards expire as follows: $1,000 in 2002 and $53,000 in 2003. G. Deferred Expenses Costs incurred by the Trust in connection with its initial share registration and organization costs were deferred by the Funds and are being amortized on a straight-line basis over a five year period through December 1998. 20 Cash Resource Trust Notes to Financial Statements (continued) Note 3: Investment Management Agreements and Other Transactions with Affiliates Investment Management Agreement Commonwealth Advisors, Inc. (formerly Cambridge Investment Advisors, Inc.) the Funds' investment adviser ("Investment Adviser")provides investment advisory services to each of the Funds. Commonwealth Investment Counsel, Inc. ("Commonwealth"), an affiliate of the Investment Adviser, serves as sub-adviser to each of the Funds, pursuant to a sub-advisory agreement among the Investment Adviser, Commonwealth and the Trust. Commonwealth furnishes a continuing investment program for each of the Funds and makes investment decisions on their behalf. The Investment Adviser and Commonwealth are wholly-owned subsidiaries of Mentor Investment Group, Inc. ("Mentor") (formerly Investment Management Group, Inc.), which is in turn a wholly-owned subsidiary of Wheat First Butcher Singer, Inc. ("Wheat"). Each Fund pays management fees to the Investment Adviser monthly at the following annual rates, expressed as a percentage of average daily net assets: 0.22% of the first $500 million of each Fund's average net assets; 0.20% of the next $500 million; 0.175% of the next $1 billion; 0.16% of the next $1 billion; and 0.15% of any amounts over $3 billion. The Investment Adviser in turn pays fees from its own assets to Commonwealth monthly at the following annual rates (based on the assets of each Fund taken separately): 0.17% of the first $500 million of a Fund's average net assets; 0.15% of the next $500 million; 0.125% of the next $1 billion; 0.11% of the next $1 billion; and 0.10% of any amounts over $3 billion. The Investment Adviser may from time to time voluntarily waive some or all of its investment advisory fee and may terminate any such voluntary waiver at any time at its sole discretion. For the year ended July 31, 1996, the Investment Adviser and sub-adviser earned the following advisory fees: Adviser Sub-Adviser Fee Fee Earned Earned Money Market Fund $1,172,603 $ 900,553 U.S. Government Fund 2,660,041 1,995,031 Tax-Exempt Fund 632,135 488,468 21 Cash Resource Trust Notes to Financial Statements (continued) In addition, the Funds provide direct reimbursement to Mentor for certain accounting and operations related costs not covered under the Investment Management Agreement. For the year ended July 31, 1996, the Money Market Fund, U.S. Government Fund and Tax-Exempt Fund paid $12,482, $30,947 and $6,767, respectively to Mentor for these direct reimbursements. Distribution Agreement Under a Distribution Agreement, Mentor Distributors, Inc. ("Mentor Distributors") (formerly, Cambridge Distributors, Inc.) a wholly-owned subsidiary of Mentor, was appointed Distributor for each Fund. To compensate Mentor Distributors for the services it provides and for the expenses it incurs under the Distribution Agreement, the Funds have adopted a Plan of Distribution pursuant to Rule 12b-1 under the Investment Company Act of 1940, under which they pay a distribution fee, which is accrued daily and paid monthly at the annual rate of 0.38% of the Fund's average daily net assets for the Money Market Fund and U.S. Government Fund and 0.33% of the Fund's average daily net assets for the Tax-Exempt Fund. In order to compensate selected financial institutions, such as investment dealers and banks through which shares of each Fund are sold ("Financial Institutions") for services provided in connection with sales of shares of each Fund and/or for administrative services and the maintenance of shareholder accounts, Mentor Distributors may make periodic payments to qualifying Financial Institutions based on the average net asset value of shares of a Fund which are attributable to shareholders for whom the Financial Institutions are designated as the Financial Institution of record. Mentor Distributors may make such payments at the annual rate of up to 0.40% of the average net asset value of such shares (0.33% in the case of Cash Resource Tax-Exempt Money Market Fund). Transfer Agent Agreement Under a Transfer Agency Agreement, Investors Fiduciary Trust Company ("IFTC") serves as Transfer Agent and Dividend Disbursing Agent for each Fund. IFTC in turn compensates Wheat (from IFTC's own assets) for related services provided by Wheat directly to its clients. For the year ended July 31, 1996, Wheat earned fees of $757,964, $2,942,606 and $304,012, respectively, from the Money Market Fund, U.S. Government Fund and Tax-Exempt Fund. 22 Independent Auditors' Report The Trustees Cash Resource Trust We have audited the accompanying statements of assets and liabilities, including the portfolios of investments, of the Money Market Fund, U.S. Government Money Market Fund and Tax-Exempt Money Market Fund, (portfolios of Cash Resource Trust) as of July 31, 1996 and the related statements of operations for the year then ended, and the statements of changes in net assets for each of the years in the two year period then ended, and financial highlights for each of the years in the two year period then ended and for the period from December 20, 1993 (commencement of operations) to July 31, 1994. These financial statements and financial highlights are the responsibility of the Funds' 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 also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements and financial highlights. Our procedures included confirmation of securities owned as of July 31, 1996 by correspondence with the custodian and brokers. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the Money Market Fund, U.S. Government Money Market Fund and Tax-Exempt Money Market Fund as of July 31, 1996, the results of their operations for the year then ended and the changes in their net assets for each of the years in the two year period then ended and their financial highlights for the periods indicated in the first paragraph above, in conformity with generally accepted accounting principles. /s/ KPMG PEAT MARWICK LLP Boston, Massachusetts September 6, 1996 23 Shareholder Information Trustees Daniel J. Ludeman, Trustee & Chairman Chairman and Chief Executive Officer Mentor Investment Group, Inc. Arnold H. Dreyfuss, Trustee former Chairman and Chief Executive Officer Hamilton Beach/Proctor-Silex, Inc. Thomas F. Keller, Trustee former Dean, Fuqua School of Business Duke University Louis W. Moelchert, Jr., Trustee Vice President for Business & Finance University of Richmond Stanley F. Pauley, Jr., Trustee Chairman and Chief Executive Officer Carpenter Company Troy A. Peery, Jr., Trustee President Heilig-Meyers Company Peter J. Quinn, Jr., Trustee Managing Director Mentor Investment Group, Inc. Officers Paul F. Costello, President Managing Director Mentor Investment Group, Inc. Terry L. Perkins, Treasurer Senior Vice President Mentor Investment Group, Inc. John M. Ivan, Secretary Managing Director/Assistant General Counsel Wheat First Butcher Singer, Inc. Michael A. Wade, Assistant Treasurer Associate Vice President Mentor Investment Group, Inc. This report is authorized for distribution to prospective investors only when preceded or accompanied by a prospectus, which contains facts concerning the objective, policies, management fees, and expenses of the Trust and further information. Cash Resource Trust 901 East Byrd Street Richmond, VA 23219 -----END PRIVACY-ENHANCED MESSAGE-----