- --------------------------------------------------------------------------------
21ST ANNUAL REPORT
- --------------------------------------------------------------------------------
SELIGMAN
CASH
MANAGEMENT
FUND, INC.
- --------------------------------------------------------------------------------
December 31, 1996
- --------------------------------------------------------------------------------
A Money Market Fund
Established in 1977
SELIGMAN FINANCIAL SERVICES, INC.
an affiliate of
[Logo]
J. & W. SELIGMAN & CO.
INCORPORATED
ESTABLISHED 1864
100 Park Avenue, New York, NY 10017
This report is intended only for the information of shareholders or those who
have received the offering prospectus covering shares of Capital Stock of
Seligman Cash Management Fund, Inc., which contains information about the sales
charges, management fee, and other costs. Please read the prospectus carefully
before investing or sending money.
TXCM2 12/96
<PAGE>
================================================================================
SELIGMAN CASH MANAGEMENT FUND, INC.
- --------------------------------------------------------------------------------
A money market mutual fund that seeks to preserve capital and to maximize
liquidity and current income by investing in high-quality money market
instruments.
<TABLE>
<CAPTION>
HIGHLIGHTS OF 1996
- -------------------------------------------------------------------------------------------------------------------------
CLASS A CLASS B CLASS D
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Net Assets........................................... $208,949,614 $2,493,437 $22,309,114
- -------------------------------------------------------------------------------------------------------------------------
Net Asset Value per Share............................ $1.00 $1.00 $1.00
Number of Shareholders............................... 11,432 156 1,234
- -------------------------------------------------------------------------------------------------------------------------
Dividends............................................ $.046 $.025* $.036
- -------------------------------------------------------------------------------------------------------------------------
Annualized Net Yield per Share....................... 4.61% 3.58%* 3.61%
Annualized Effective Yield per Share with
Dividends Invested Monthly....................... 4.71% 3.64%* 3.67%
- -------------------------------------------------------------------------------------------------------------------------
</TABLE>
Investments in the Fund are neither insured nor guaranteed by the US Government
and there is no assurance that the Fund will be able to maintain a stable net
asset value of $1.00 per share.
*From April 22, 1996 (commencement of operations).
1
<PAGE>
================================================================================
TO THE SHAREHOLDERS
- --------------------------------------------------------------------------------
Overall, Seligman Cash Management Fund provided a solid yield in 1996 while
it continued to invest in only the highest quality money market instruments. The
Fund's yield at year-end 1996 was slightly lower than at year-end 1995, as the
Federal Reserve Board did not increase the fed funds rate after an initial
lowering in February 1996.
Nineteen ninety-six was a challenging year for the fixed-income markets. In
the short-term securities market, yields improved gradually, recovering from the
lows reached after the February reduction in the fed funds rate -- the interest
rate charged for interbank loans. The increase in the rate of economic growth in
the second quarter supported the assumption that the Fed would increase
short-term interest rates for a time, and yields on money market securities
improved. However, the lack of any noticeable increases in inflationary
indicators provided the support necessary to maintain the fed funds rate at
5.25% through December 1996, down from the 5.50% rate at the end of December
1995. Further, the yield on the benchmark three-month Treasury bill, which moves
rapidly in response to changes in the economic environment, ended the year at
5.17%, modestly higher than the 5.05% yield at year-end 1995.
Currently, there are no clear indications that there will be either runaway
economic expansion or recession in 1997. Looking ahead, the environment for the
fixed-income markets and investors remains generally positive, given continued
modest economic growth, low inflation, and bipartisan efforts to balance the
federal budget without raising taxes. While we always recognize that there could
be further short-term volatility, we remain positive about the long-term outlook
for the fixed-income markets and your Fund.
A discussion with your Portfolio Manager and the Fund's portfolio of
investments follow this letter.
We thank you for your interest in Seligman Cash Management Fund, and look
forward to serving your investment needs in the many years to come.
By order of the Board of Directors,
/S/ WILLIAM C. MORRIS
- ---------------------
William C. Morris
Chairman
/s/ BRIAN T. ZINO
-----------------
Brian T. Zino
President
January 31, 1997
2
<PAGE>
================================================================================
INTERVIEW WITH YOUR PORTFOLIO MANAGER
- --------------------------------------------------------------------------------
[Picture Omitted]
Seligman Taxable Fixed Income Team: (from left) Nicholas Walsh, James
Auchterlonie, (seated) Leonard J. Lovito (Portfolio Manager), Susan Egan
LEONARD J. LOVITO is a Vice President of J. & W. Seligman & Co. Incorporated and
Vice President and Portfolio Manager of Seligman Cash Management Fund. He also
serves as Vice President of Seligman High Income Fund Series and Portfolio
Manager of its Seligman U.S. Government Securities Series, and Vice President of
Seligman Portfolios, Inc. and Portfolio Manager of its Seligman Bond and
Seligman Cash Management Portfolios. Mr. Lovito joined Seligman in 1984 as a
fixed-income analyst and has more than 13 years of fixed-income trading and
portfolio management experience. Mr. Lovito is supported by a team of seasoned
research professionals who assist him in selecting investments in accordance
with your Fund's objective.
WHICH ECONOMIC FACTORS AFFECTED SELIGMAN CASH MANAGEMENT FUND IN THE LAST 12
MONTHS?
"In February 1996, the Federal Reserve Board made its only adjustment to
short-term interest rates in the year, lowering the fed funds rate by 0.25%. The
adjustment was in response to the slowdown in economic growth that began during
1995. This slower growth trend was expected to continue throughout 1996, as were
further cuts in interest rates. However, the rate of economic growth began to
pick up in the second quarter of 1996, and remained stable throughout the rest
of the year. Consequently, the fed funds rate remained unchanged.
"Any adjustment to short-term interest rates has an immediate impact on
money market rates, and the February reduction was no exception. Therefore, the
rates on the types of money market instruments your Fund invests in declined in
the first half of 1996. However, the economic picture improved and fears of
inflationary pressure emerged, increasing the possibility that interest rates
would be raised. In this environment, money market rates reversed their course
and recovered some of the ground lost earlier in the year. The ultimate effect
of the movements in money market rates was a slight decline in Seligman Cash
Management's yield which, based on the net asset value of Class A shares, ended
the year at 4.61%, down from 5.06% at year-end 1995."
WHAT WAS YOUR INVESTMENT STRATEGY?
"After the Fed lowered short-term rates in February, the average maturity of the
Fund was extended to lock in longer-term rates. As the economic and interest
rate outlook improved, the Fund's average maturity was shortened in the second
quarter to 35-40 days, and maintained at approximately 35 days throughout the
second half of 1996, down from 45 days in the first quarter of 1996."
WHAT IS THE OUTLOOK?
"Since moderate economic growth and relatively low levels of inflation are
expected in 1997, the Fed is likely to keep short-term interest rates unchanged
in the near term. If this proves to be the case, we will continue to maintain a
30- to 40-day average maturity for the portfolio. However, if economic
fundamentals change, we are prepared to lengthen or shorten the Fund's average
maturity as appropriate. We will continue to invest in the highest quality money
market instruments, as we expand the list of investments, adding diversity to
the Fund's investment portfolio."
3
<PAGE>
================================================================================
PORTFOLIO OF INVESTMENTS December 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ANNUALIZED
YIELD ON PRINCIPAL
PURCHASE DATE AMOUNT VALUE
------------- ------ -----
<S> <C> <C> <C>
COMMERCIAL PAPER 64.1%
AUTOMOTIVE 5.1%
Ford Motor Credit Corp., 3/21/97 ....................... 5.38% $12,000,000 $ 11,860,170
-------------
BANKING 9.3%
CoreStates Financial Corp., 1/28/97 .................... 5.34 11,600,000 11,554,151
Norwest Financial Corp., 3/7/97 ........................ 5.37 10,200,000 10,102,392
-------------
21,656,543
-------------
CAPITAL EQUIPMENT 9.6%
General Electric Capital Corp., 1/14/97 ................ 5.39 11,200,000 11,178,484
John Deere Capital Corp., 2/7/97 ....................... 5.36 11,300,000 11,238,563
-------------
22,417,047
-------------
CONSUMER PRODUCTS 4.2%
Clorox Company, 3/6/97 ................................. 5.35 10,000,000 9,906,133
-------------
DEFENSE 4.3%
Raytheon Corp., 1/10/97 ................................ 5.36 10,000,000 9,986,775
-------------
FINANCE 18.7%
American Express Credit Corp., 2/18/97 ................. 5.35 11,100,000 11,021,856
American General Finance Corp., 1/17/97 ................ 5.37 10,900,000 10,874,324
Associates Corp. of North America, 2/19/97 ............. 5.36 11,000,000 10,920,797
Associates Corp. of North America, 3/3/97 .............. 5.37 11,100,000 11,000,316
-------------
43,817,293
-------------
OFFICE PRODUCTS 4.2%
Pitney Bowes Credit Corp., 3/10/97 ..................... 5.34 10,000,000 9,900,455
-------------
TELECOMMUNICATIONS 8.7%
Ameritech Corp., 3/4/97 ................................ 5.34 10,000,000 9,909,239
BellSouth Telecommunications, 2/5/97 ................... 5.34 10,500,000 10,446,202
-------------
20,355,441
-------------
TOTAL COMMERCIAL PAPER (Cost $149,899,857) ............. 149,899,857
-------------
FIXED TIME DEPOSITS 22.1%
ABN-AMRO Bank, Grand Cayman, 1/2/97 .................... 5.51 10,900,000 10,900,000
Canadian Imperial Bank of Commerce, Grand Cayman, 1/2/97 6.59 10,900,000 10,900,000
First National Bank of Chicago, Grand Cayman, 1/2/97 ... 6.34 10,900,000 10,900,000
National Westminster Bank, Nassau, 1/2/97 .............. 6.59 3,800,000 3,800,000
Republic National Bank of New York, 1/2/97 ............. 6.84 10,900,000 10,900,000
Swiss Bank, Grand Cayman, 1/2/97 ....................... 6.59 4,200,000 4,200,000
-------------
TOTAL FIXED TIME DEPOSITS (Cost $51,600,000) ........... 51,600,000
-------------
BANK NOTES 9.1%
Huntington National Bank, Ohio, 1/10/97 ................ 5.49 10,300,000 10,300,000
First Chicago NBD Bancorp, Detroit, 1/6/97 ............. 5.45 10,900,000 10,900,030
-------------
TOTAL BANK NOTES (Cost $21,200,030) .................... 21,200,030
-------------
TOTAL INVESTMENTS 95.3% (Cost $222,699,887) ........... 222,699,887
OTHER ASSETS LESS LIABILITIES 4.7% .................... 11,052,278
-------------
NET ASSETS 100.0% ..................................... $233,752,165
=============
</TABLE>
- ----------
See Notes to Financial Statements.
4
<PAGE>
================================================================================
STATEMENT OF ASSETS AND LIABILITIES December 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C> <C>
ASSETS:
Investments, at value:
Commercial paper (cost $149,899,857)............................................. $149,899,857
Fixed time deposits (cost $51,600,000)........................................... 51,600,000
Bank notes (cost $21,200,030).................................................... 21,200,030 $ 222,699,887
----------
Cash........................................................................................... 241,935
Receivable for Capital Stock sold.............................................................. 14,529,654
Interest receivable............................................................................ 294,988
Investment in, and expenses prepaid to, shareholder service agent.............................. 57,557
Other.......................................................................................... 48,410
-------------
TOTAL ASSETS ................................................................................. 237,872,431
-------------
LIABILITIES:
Payable for Capital Stock redeemed............................................................. 3,673,744
Accrued expenses, taxes, and other............................................................. 446,522
-------------
TOTAL LIABILITIES ............................................................................. 4,120,266
-------------
NET ASSETS .................................................................................... $ 233,752,165
=============
COMPOSITION OF NET ASSETS:
Capital Stock, at par ($0.01 par value; 1,400,000,000 shares authorized;
233,756,792 shares outstanding):
Class A..................................................................................... $ 2,089,542
Class B..................................................................................... 24,934
Class D..................................................................................... 223,091
Additional paid-in capital..................................................................... 231,419,225
Accumulated net realized loss.................................................................. (4,627)
------------
NET ASSETS:
Applicable to 208,954,241 Class A shares, 2,493,437 Class B shares,
and 22,309,114 Class D shares, equivalent to $1.00 per share.............................. $ 233,752,165
=============
</TABLE>
- ----------
See Notes to Financial Statements.
5
<PAGE>
================================================================================
STATEMENT OF OPERATIONS For the Year Ended December 31, 1996
- --------------------------------------------------------------------------------
INVESTMENT INCOME:
Interest ......................................................... $11,169,716
-----------
EXPENSES:
Management fee ................................................... 846,790
Shareholder account services ..................................... 490,381
Distribution and service fees .................................... 150,800
Registration ..................................................... 93,182
Shareholder reports and communications ........................... 55,194
Custodian services ............................................... 53,000
Auditing and legal fees .......................................... 52,158
Directors' fees and expenses ..................................... 30,188
Miscellaneous .................................................... 16,005
-----------
TOTAL EXPENSES ................................................... 1,787,698
-----------
NET INVESTMENT INCOME AND INCREASE IN NET ASSETS FROM OPERATIONS . $ 9,382,018
===========
- ----------
See Notes to Financial Statements.
6
<PAGE>
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STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
---------------------------------
1996 1995
------- ------
<S> <C> <C>
OPERATIONS:
Increase in net assets from operations-- net investment income ........................... $ 9,382,018 $ 9,637,468
--------------- ---------------
Decrease in net assets from distributions -- net investment income paid to
shareholders as dividends:
Class A .............................................................................. (8,838,245) (9,215,896)
Class B .............................................................................. (29,542) --
Class D .............................................................................. (514,231) (421,572)
--------------- ---------------
Total .................................................................................... (9,382,018) (9,637,468)
--------------- ---------------
CAPITAL SHARE TRANSACTIONS:*
Proceeds from sale of shares:
Class A .............................................................................. 302,318,619 303,480,822
Class B .............................................................................. 2,516,484 --
Class D .............................................................................. 8,286,958 --
Net proceeds from transfer of Government Portfolio -- Class A ........................... -- 21,971,609
Net asset value of shares issued in payment of dividends:
Class A .............................................................................. 7,769,306 8,011,199
Class B .............................................................................. 23,729 --
Class D .............................................................................. 395,206 328,806
Exchanged from associated Funds:
Class A .............................................................................. 1,123,234,216 361,106,751
Class B .............................................................................. 5,538,322 --
Class D .............................................................................. 144,499,447 80,746,637
--------------- ---------------
Total .................................................................................... 1,594,582,287 775,645,824
--------------- ---------------
Cost of shares redeemed:
Class A .............................................................................. (315,244,457) (360,478,471)
Class B .............................................................................. (57,036) --
Class D .............................................................................. (16,603,403) (9,346,161)
Exchanged into associated Funds:
Class A .............................................................................. (1,086,522,720) (351,102,803)
Class B .............................................................................. (5,528,062) --
Class D .............................................................................. (128,823,731) (60,632,635)
--------------- ---------------
Total .................................................................................... (1,552,779,409) (781,560,070)
--------------- ---------------
Increase (decrease) in net assets from capital share transactions ........................ 41,802,878 (5,914,246)
--------------- ---------------
Increase (decrease) in net assets ........................................................ 41,802,878 (5,914,246)
NET ASSETS:
Beginning of year ........................................................................ 191,949,287 197,863,533
--------------- ---------------
End of year .............................................................................. $ 233,752,165 $ 191,949,287
=============== ===============
- ----------
* The Fund began offering Class B shares on April 22, 1996.
See Notes to Financial Statements.
</TABLE>
7
<PAGE>
================================================================================
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
1. Seligman Cash Management Fund, Inc. (the "Fund") offers three classes of
shares: Class A shares, Class B shares, and Class D shares, each of which may be
acquired by investors at net asset value. All shares existing prior to May 3,
1993, were classified as Class A shares. The Fund began offering Class B shares
on April 22, 1996. Class B shares are subject to a distribution fee of up to
0.75% and a service fee of up to 0.25% on an annual basis, and a contingent
deferred sales load ("CDSL"), if applicable, of 5% on redemptions in the first
year after purchase, declining to 1% in the sixth year and 0% thereafter. Class
B shares will automatically convert to Class A shares on the last day of the
month that precedes the eighth anniversary of their date of purchase. Class D
shares are subject to a distribution fee of up to 0.75% and a service fee of up
to 0.25% on an annual basis, and a CDSL of 1% imposed on certain redemptions
made within one year of purchase. The three classes of shares represent
interests in the same portfolio of investments, have the same rights, and are
generally identical in all respects except that each class bears its separate
distribution and certain other class expenses, and has exclusive voting rights
with respect to any matter on which a separate vote of any class is required.
2. Significant accounting policies followed, all in conformity with generally
accepted accounting principles, are given below:
a. The Fund uses the amortized cost method for valuing portfolio securities.
Under this method all investments purchased at a discount or premium are
valued by amortizing the difference between the original purchase price and
the maturity value of the issue over the period to maturity.
b. There is no provision for federal income or excise tax. The Fund has
elected to be taxed as a regulated investment company and intends to
distribute substantially all taxable net income and net gain realized.
Dividends are declared daily and paid monthly.
c. Investment transactions are recorded on trade dates. Identified cost of
investments sold is used for both financial statement and federal income
tax purposes. The cost of investments for federal income tax purposes is
substantially the same as the cost for financial reporting purposes.
Interest income, including the amortization of discount or premium, is
recorded as earned.
d. The Fund may enter into repurchase agreements with commercial banks and
with broker/dealers deemed to be creditworthy by J. & W. Seligman & Co.
Incorporated (the "Manager"). Securities received as collateral subject to
repurchase agreements are deposited with the Fund's custodian and, pursuant
to the terms of the repurchase agreement, must have an aggregate market
value greater than or equal to the repurchase price plus accrued interest,
at all times. Procedures have been established to monitor, on a daily
basis, the market value of repurchase agreements' underlying securities to
ensure the existence of the proper level of collateral.
e. All income, expenses (other than class-specific ex- penses), and realized
and unrealized gains or losses, if any, are allocated daily to each class
of shares based upon the relative value of shares of each class.
Class-specific expenses, which include distribution and service fees and
any other items that are specifically attributed to a particular class, are
charged directly to such class. For the year ended December 31, 1996,
distribution and service fees were the only class-specific expenses.
3. The Manager manages the affairs of the Fund and provides the necessary
personnel and facilities. Compensation of all officers of the Fund, all
directors of the Fund who are employees or consultants of the Manager, and all
personnel of the Fund and the Manager is paid by the Manager. The Manager
receives a fee, calculated daily and paid monthly, equal to a per annum
percentage of the Fund's average daily net assets.
8
<PAGE>
================================================================================
- --------------------------------------------------------------------------------
The management fee rate is calculated on a sliding scale of 0.45% to
0.375%, based on average daily net assets of all the investment companies
managed by the Manager. The management fee for the year ended December 31, 1996,
was equivalent to an annual rate of 0.41% of the average daily net assets of the
Fund.
The Fund has an Administration, Shareholder Services and Distribution Plan
(the "Plan"). Under the Plan, with respect to Class A shares, service
organizations can enter into agreements with Seligman Financial Services, Inc.
(the "Distributor") and receive a continuing fee of up to 0.25% on an annual
basis of the average daily net assets of Class A shares, attributable to the
particular service organizations for providing personal services and/or the
maintenance of shareholder accounts. The Distributor, and likewise the Fund, did
not make payments under the Plan with respect to Class A shares during the year
ended December 31, 1996.
Under the Plan, with respect to Class B and Class D shares, service
organizations can enter into agreements with the Distributor and receive a
continuing fee for providing personal services and/or the maintenance of
shareholder accounts of up to 0.25% on an annual basis of the average daily net
assets of the Class B and Class D shares for which the organizations are
responsible; and, for Class D shares only, fees for providing other distribution
assistance of up to 0.75% on an annual basis of such average daily net assets.
Such fees are paid monthly by the Fund to the Distributor pursuant to the Plan.
With respect to Class B shares, a distribution fee of up to 0.75% on an
annual basis of average daily net assets is payable monthly by the Fund to the
Distributor; however, the Distributor has sold its rights to substantially all
of this fee to a third party (the "Purchaser") which provided funding to the
Distributor to enable it to pay commissions to dealers at the time of the sale
of the related Class B shares.
For the year ended December 31, 1996, fees incurred under the Plan,
equivalent to 1% per annum of the average daily net assets of Class B and Class
D shares, amounted to $8,128 and $142,672, respectively.
The Distributor is entitled to retain any CDSL imposed on certain
redemptions of Class D shares. For the year ended December 31, 1996, such
charges amounted to $66,631.
The Distributor has sold its rights to collect any CDSL imposed on
redemptions of Class B shares to the Purchaser. In connection with the sale of
its rights to collect any CDSL and the distribution fees with respect to Class B
shares described above, the Distributor receives payments from the Purchaser
based on the value of Class B shares sold. The aggregate amount of such payments
and the Class B shares distribution fees retained by the Distributor for the
period ended December 31, 1996, was $4,806.
Seligman Services, Inc., an affiliate of the Manager, is eligible to
receive distribution and service fees pursuant to the Plan. For the year ended
December 31, 1996, Seligman Services, Inc. received distri-bution and service
fees of $10,159, pursuant to the Plan.
Seligman Data Corp., owned by the Fund and certain associated investment
companies, charged the Fund at cost $490,381 for shareholder account services.
The Fund's investment in Seligman Data Corp. is recorded at a cost of $3,719.
Certain officers and directors of the Fund are officers or directors of the
Manager, the Distributor, Seligman Services, Inc., and/or Seligman Data Corp.
Fees of $16,000 were incurred by the Fund for legal services of Sullivan &
Cromwell, a member of which firm is a director of the Fund.
The Fund has a compensation arrangement under which directors who receive
fees may elect to defer receiving such fees. Interest is accrued on the deferred
balances. The annual cost of such fees and
9
<PAGE>
================================================================================
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
- --------------------------------------------------------------------------------
interest is included in directors' fees and expenses, and the accumulated
balance thereof at December 31, 1996, of $141,692, is included in other
liabilities. Deferred fees and related accrued interest are not deductible for
federal income tax purposes until such amounts are paid.
4. At December 31, 1996, the Fund had a net loss carryforward of $4,627, which
is available for offset against future taxable net gains, expiring in 1999.
5. On January 17, 1995, shareholders of the Fund's Government Portfolio approved
a transfer of its net assets to the Fund's Prime Portfolio Class A in a tax-free
exchange. As a result, on January 26, 1995, 21,971,609 shares of the Prime
Portfolio Class A valued at $21,971,609 were exchanged for the net assets of the
Government Portfolio. For each share of Capital Stock owned, shareholders of the
Government Portfolio received one share of Capital Stock of the Prime Portfolio
Class A. In addition, since it is the only remaining portfolio of the Fund,
Prime Portfolio is no longer designated as such.
Immediately before the transfer of net assets, the Condensed Financial
Statements of the Government Portfolio were as follows:
CONDENSED STATEMENT OF NET ASSETS
JANUARY 26, 1995
Total assets ............................................ $ 22,005,452
Total liabilities ....................................... 33,843
------------
Net assets .............................................. $ 21,971,609
============
Shares of Capital Stock outstanding ..................... 21,971,609
Net asset value per share ............................... $ 1.000
CONDENSED STATEMENT OF OPERATIONS --
JANUARY 1, 1995, TO
JANUARY 26, 1995
Net investment income and increase
in net assets from operations ........................ $ 71,496
============
CONDENSED STATEMENT OF CHANGES
IN NET ASSETS -- JANUARY 1, 1995,
TO JANUARY 26,1995
Net investment income and increase
in net assets from operations ........................ $ 71,496
Decrease in net assets from
distributions ........................................ (71,496)
Decrease in net assets from capital
share transactions ................................... (64,014)
------------
Net decrease in net assets .............................. (64,014)
Net Assets:
Beginning of period ................................... 22,035,623
------------
End of period ......................................... $ 21,971,609
============
CONDENSED FINANCIAL HIGHLIGHTS --
JANUARY 1, 1995, TO
JANUARY 26, 1995
Net asset value, beginning of period .................... $ 1.000
Net investment income ................................... 0.003
Dividends paid .......................................... (0.003)
------------
Net asset value, end of period .......................... $ 1.000
============
10
<PAGE>
================================================================================
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
The Fund's financial highlights are presented below. The per share operating
performance data is designed to allow investors to trace the operating
performance, on a per share basis, from each Class's beginning net asset value
to the ending net asset value so that they can understand what effect the
individual items have on their investment, assuming it was held throughout the
period. Generally, the per share amounts are derived by converting the actual
dollar amounts incurred for each item, as disclosed in the financial statements,
to their equivalent per share amounts.
The total return based on net asset value measures each Class's performance
assuming investors purchased Fund shares at net asset value as of the beginning
of the period, reinvested dividends paid at net asset value, and then sold their
shares at the net asset value per share on the last day of the period. The total
returns for periods of less than one year are not annualized.
<TABLE>
<CAPTION>
CLASS A CLASS B
---------------------------------------------------------- --------
4/22/96*
YEAR ENDED DECEMBER 31, TO
----------------------------------------------------------
1996 1995 1994 1993 1992 12/31/96
----- ----- ----- ----- ----- --------
<S> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING
PERFORMANCE:
Net asset value, beginning of
period ........................ $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
Net investment income ............ .046 .051 .034 .024 .030 .025
Dividends paid or declared ....... (.046) (.051) (.034) (.024) (.030) (.025)
-------- -------- -------- -------- -------- --------
Net asset value, end of period ... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
======== ======== ======== ======== ======== ========
TOTAL RETURN BASED
ON NET ASSET VALUE: ........... 4.71% 5.18% 3.46% 2.40% 3.10% 2.44%
RATIOS/SUPPLEMENTAL
DATA:
Expenses to average net assets ... .79% .86% .82% .77% .76% 1.78%+
Net investment income to
average net assets ............ 4.61% 5.06% 3.41% 2.37% 3.04% 3.58%+
Net assets, end of period
(000s omitted) ................ $208,950 $177,395 $194,406 $173,902 $193,158 $ 2,493
Without management fee waiver
or reimbursement of expenses:**
Net investment income per share .. $ .023 $ .029
Ratios:
Expenses to average net assets . .86% .85%
Net investment income to
average net assets .......... 2.28% 2.95%
</TABLE>
<TABLE>
<CAPTION>
CLASS D
------------------------------------------
5/3/93*
YEAR ENDED DECEMBER 31, TO
-------------------------------
1996 1995 1994 12/31/93
-------- ------ ------ --------
<S> <C> <C> <C> <C>
PER SHARE OPERATING
PERFORMANCE:
Net asset value, beginning of
period ........................ $ 1.000 $ 1.000 $ 1.000 $ 1.000
Net investment income ............ .036 .040 .024 .003
Dividends paid or declared ....... (.036) (.040) (.024) (.003)
-------- -------- -------- --------
Net asset value, end of period ... $ 1.000 $ 1.000 $ 1.000 $ 1.000
======== ======== ======== ========
TOTAL RETURN BASED
ON NET ASSET VALUE: ........... 3.67% 4.08% 2.35% .30%
RATIOS/SUPPLEMENTAL
DATA:
Expenses to average net assets ... 1.79% 1.90% 1.90% 1.74%+
Net investment income to
average net assets ............ 3.61% 4.02% 2.32% 1.39%+
Net assets, end of period
(000s omitted) ................ $ 22,309 $ 14,554 $ 3,458 $ 26
Without management fee waiver
or reimbursement of expenses:**
Net investment income per share .. $ .013 $ .002
Ratios:
Expenses to average net assets . 3.23% 1.83%+
Net investment income to
average net assets .......... .99% 1.30%+
</TABLE>
- ----------
* Commencement of offering of shares.
** For the years 1992 and 1993, the Manager, at its discretion, waived a
portion of its management fees for the Fund, and reimbursed certain expenses
for Class D shares in 1994.
+ Annualized.
See Notes to Financial Statements.
11
<PAGE>
================================================================================
REPORT OF INDEPENDENT AUDITORS
- --------------------------------------------------------------------------------
THE BOARD OF DIRECTORS AND SHAREHOLDERS,
SELIGMAN CASH MANAGEMENT FUND, INC.:
We have audited the accompanying statement of assets and liabilities, including
the portfolio of investments, of Seligman Cash Management Fund, Inc. as of
December 31, 1996, the related statements of operations for the year then ended
and of changes in net assets for each of the years in the two-year 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 securities owned as of
December 31, 1996, by correspondence with the Fund's custodian. 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, such financial statements and financial highlights present
fairly, in all material respects, the financial position of Seligman Cash
Management Fund, Inc. as of December 31, 1996, the results of its operations,
the changes in its net assets, and the financial highlights for the respective
stated periods in conformity with generally accepted accounting principles.
DELOITTE & TOUCHE LLP
New York, New York
January 31, 1997
12
<PAGE>
================================================================================
BOARD OF DIRECTORS
- --------------------------------------------------------------------------------
FRED E. BROWN
DIRECTOR AND CONSULTANT,
J. & W. Seligman & Co. Incorporated
JOHN R. GALVIN 2, 4
DEAN, Fletcher School of Law and
Diplomacy at Tufts University
DIRECTOR, USLIFE Corporation
ALICE S. ILCHMAN 3, 4
PRESIDENT, Sarah Lawrence College
TRUSTEE, Committee for Economic Development
DIRECTOR, NYNEX
CHAIRMAN, The Rockefeller Foundation
FRANK A. MCPHERSON 2, 4
CHAIRMAN AND CEO, Kerr-McGee Corporation
DIRECTOR, Kimberly-Clark Corporation
DIRECTOR, Baptist Medical Center
JOHN E. MEROW
SENIOR PARTNER, Sullivan & Cromwell, Law Firm
DIRECTOR, Commonwealth Aluminum Corporation
BETSY S. MICHEL 2, 4
DIRECTOR OR TRUSTEE,
Various Organizations
WILLIAM C. MORRIS 1
CHAIRMAN
CHAIRMAN OF THE BOARD,
J. & W. Seligman & Co. Incorporated
CHAIRMAN, Carbo Ceramics Inc.
DIRECTOR, Kerr-McGee Corporation
JAMES C. PITNEY 3, 4
PARTNER, Pitney, Hardin, Kipp & Szuch, Law Firm
DIRECTOR, Public Service Enterprise Group
JAMES Q. RIORDAN 3, 4
DIRECTOR, The Brooklyn Union Gas Company
TRUSTEE, Committee for Economic Development
DIRECTOR, Dow Jones & Co., Inc.
DIRECTOR, Public Broadcasting Service
Ronald T. Schroeder 1
MANAGING DIRECTOR, J. & W. Seligman & Co.
Incorporated
ROBERT L. SHAFER 3, 4
DIRECTOR OR TRUSTEE,
Various Organizations
JAMES N. WHITSON 2, 4
EXECUTIVE VICE PRESIDENT AND DIRECTOR,
Sammons Enterprises, Inc.
DIRECTOR, C-SPAN
DIRECTOR, Red Man Pipe and Supply Company
BRIAN T. ZINO 1
PRESIDENT
PRESIDENT AND MANAGING DIRECTOR,
J. & W. Seligman & Co. Incorporated
CHAIRMAN AND PRESIDENT, Seligman Data Corp.
- ----------
Member: 1 Executive Committee
2 Audit Committee
3 Director Nominating Committee
4 Board Operations Committee
13
<PAGE>
================================================================================
EXECUTIVE OFFICERS
- --------------------------------------------------------------------------------
WILLIAM C. MORRIS
CHAIRMAN
BRIAN T. ZINO
PRESIDENT
LEONARD J. LOVITO
VICE PRESIDENT
LAWRENCE P. VOGEL
VICE PRESIDENT
THOMAS G. ROSE
TREASURER
FRANK J. NASTA
SECRETARY
- --------------------------------------------------------------------------------
MANAGER
J. & W. Seligman & Co.
Incorporated
100 Park Avenue
New York, NY 10017
GENERAL COUNSEL
Sullivan & Cromwell
INDEPENDENT AUDITORS
Deloitte & Touche LLP
GENERAL DISTRIBUTOR
Seligman Financial Services, Inc.
100 Park Avenue
New York, NY 10017
SHAREHOLDER SERVICE AGENT
Seligman Data Corp.
100 Park Avenue
New York, NY 10017
IMPORTANT TELEPHONE NUMBERS
(800) 221-2450 Shareholder
Services
(800) 445-1777 Retirement Plan
Services
(800) 622-4597 24-Hour Automated
Telephone Access
Service
14
