Reserve Investment Fund
Unaudited
Financial Highlights
For a share outstanding throughout each period
8/25/97
through
11/30/97
NET ASSET VALUE
Beginning of period $ 1.000
Investment activities
Net investment income 0.015
Distributions
Net investment income (0.015)
NET ASSET VALUE
End of period $ 1.000
Ratios/Supplemental Data
Total return 1.53%
Ratio of expenses to average net assets 0.01%!
Ratio of net investment income to
average net assets 5.66%!
Net assets, end of period (in thousands) $2,863,376
! Annualized.
Government Reserve Investment Fund
Unaudited
Financial Highlights
For a share outstanding throughout each period
8/25/97
through
11/30/97
NET ASSET VALUE
Beginning of period $ 1.000
Investment activities
Net investment income 0.014
Distributions
Net investment income (0.014)
NET ASSET VALUE
End of period $ 1.000
Ratios/Supplemental Data
Total return 1.46%
Ratio of expenses to average net assets 0.02%!
Ratio of net investment income to
average net assets 5.39%!
Net assets, end of period (in thousands) $ 376,091
! Annualized.
Reserve Investment Fund
Unaudited
Statement of Net Assets
November 30, 1997
Par Value
In thousands
BANK NOTES 1.2%
FCC National Bank, 5.82%,
9/18/98 $ 9,000 $ 8,998
First Tennessee Bank N.A.
5.58%, 12/12/97 5,000 5,000
5.60%, 1/26/98 20,000 19,994
Total Bank Notes (Cost $33,992) 33,992
CERTIFICATES OF DEPOSIT 40.6%
Abby National
(London)
5.59%, 12/31/97 51,000 51,001
5.61%, 12/31/97 18,000 18,000
ABN AMRO
5.60%, 2/20/98 25,000 24,987
5.65%, 12/23/97 10,000 9,999
5.68%, 1/30/98 25,000 25,001
5.93%, 6/19/98 1,000 1,000
Australia & New Zealand Banking
5.68%, 2/27/98 5,000 5,000
5.74%, 3/2/98 15,000 15,001
(London)
5.75%, 2/17/98 10,000 10,001
5.76%, 12/18/97 5,000 5,000
Banco Bilbao Vizcaya, (London),
5.78%, 2/20/98 20,000 20,000
Banco Santander
(London)
5.70%, 2/17/98 15,000 15,001
5.79%, 1/20/98 15,000 15,000
Bank of Nova Scotia
5.89%, 8/27/98 21,263 21,261
5.95%, 6/29/98 1,000 1,000
Bank of Scotland, (London), 5.73%, 3/18/98 15,000
15,002
Banque Nationale de Paris
5.78%, 7/28/98 30,000 29,988
5.90%, 10/21/98 13,500 13,505
6.07%, 3/24/98 1,000 1,001
Barclays Bank PLC
(London)
5.63%, 1/20/98 30,000 30,000
5.67%, 2/10/98 25,000 24,995
5.85%, 7/28/98 30,000 30,017
Bayerische Hypotheken und Wechsel
(London)
5.60%, 12/2/97 20,000 20,000
5.78%, 2/17/98 35,000 35,001
5.81%, 4/21/98 12,000 11,998
Bayerische Landesbank
5.775%, 7/27/98 17,000 16,990
6.02%, 5/7/98 3,200 3,202
Bayerische Vereinsbank, (London),
5.77%, 2/24/98 50,000 50,001
Canadian Imperial Bank, 5.60%,
12/30/97 20,000 20,000
Chase Manhattan Bank, 5.65%, 4/6/98 17,000 17,000
Commerzbank
5.90%, 9/10/98 10,900 10,896
(London), 5.83%, 6/12/98 20,000 20,007
Credit Agricole Indosuez
5.70%, 2/2/98 10,000 10,001
5.87%, 8/10/98 8,000 7,995
Deutsche Bank AG
5.58%, 12/31/97 50,000 49,999
6.00%, 3/26/98 2,000 2,001
Hessische Landesbank
6.08%, 6/9/98 16,000 16,013
6.13%, 4/1/98 - 4/7/98 31,000 31,025
(London), 6.06%, 6/16/98 10,000 10,011
Ing Bank, (London), 5.74%, 2/18/98 14,000 14,002
Lloyds Bank PLC, (London),
6.00%, 10/26/98 40,000 40,054
Mellon Bank N.A., 5.80%, 12/15/97 4,000 4,000
Rabobank Nederland N.V.
5.56%, 12/3/97 40,000 40,000
6.20%, 4/9/98 1,000 1,001
(London)
5.56%, 12/17/97 12,000 12,000
5.76%, 2/25/98 10,000 10,000
Societe Generale
5.56%, 12/3/97 12,000 12,000
5.65%, 1/15/98 22,000 22,000
6.35%, 4/15/98 9,500 9,515
Sudwest Deutsche Landesbank
(London)
5.60%, 12/29/97 48,000 48,001
5.73%, 3/12/98 17,000 17,001
Suntrust Bank, 5.79%, 12/4/97 5,000 5,000
Svenska Handelsbanken
5.78%, 2/27/98 10,000 10,000
(London), 5.77%, 2/17/98 20,000 20,001
Swiss Bank
5.75%, 2/11/98 30,000 30,000
5.90%, 8/28/98 8,000 8,000
5.95%, 7/2/98 1,000 1,000
Toronto Dominion Bank
(London)
5.595%, 1/20/98 33,000 32,997
5.60%, 12/31/97 19,000 19,000
5.76%, 2/24/98 20,000 20,000
Union Bank of California,
5.80%, 10/6/98 35,000 35,000
Westdeutsche Landesbank
5.61%, 12/31/97 17,000 17,000
(London)
5.89%, 7/9/98 10,000 10,002
6.00%, 7/1/98 10,000 10,007
Total Certificates of Deposit
(Cost $1,161,481) 1,161,481
COMMERCIAL PAPER 55.9%
AC Acquisition Holding,
5.60%, 2/12/98 21,876 21,628
Alliance & Leicester,
5.52%, 12/10/97 15,000 14,979
American Home Products, 4(2),
5.52%, 12/8/97 20,644 20,622
Asset Securitization Cooperative
4(2)
5.50%, 12/4/97 25,000 24,989
5.53%, 12/4/97 36,200 36,183
Associates Finance Services,
5.60%, 12/15/97 7,300 7,284
AT&T, 5.65%, 12/1/97 740 740
Banque Nationale de Paris,
5.70%, 2/6/98 5,000 4,947
Barnett Banks, 5.59%, 12/16/97 40,000 39,907
BBL North America
5.50%, 12/11/97 4,667 4,660
5.51%, 12/15/97 30,000 29,936
Bear Stearns, 5.71%, 2/6/98 31,000 30,671
Bell Atlantic Financial Services,
5.75%, 12/1/97 45,555 45,555
Beta Finance
4(2)
5.56%, 3/16/98 10,582 10,410
5.60%, 12/12/97 14,000 13,976
Bex America Finance, 5.51%, 12/8/97 10,000 9,989
BMW U.S. Capital, 5.70%, 12/1/97 11,200 11,200
BP America, 5.75%, 12/1/97 47,930 47,930
Caisse D'Amortissement,
5.52%, 12/9/97 4,900 4,894
California Pollution Control,
5.60%, 12/18/97 10,000 10,000
Caterpillar Financial Services,
5.55%, 1/16/98 8,449 8,389
Ciesco L.P., 5.50%, 12/4/97 20,000 19,991
Commonwealth Bank of Australia,
5.50%, 12/4/97 38,530 38,512
Countrywide Funding
5.53%, 12/12/97 5,000 4,992
5.75%, 1/23/98 15,200 15,071
Daimler-Benz North America
5.50%, 2/4/98 - 2/10/98 36,000 35,623
5.57%, 2/4/98 2,415 2,391
Delaware Funding
4(2)
5.50%, 12/8/97 4,099 4,095
5.52%, 12/2/97 18,700 18,697
5.70%, 2/12/98 15,000 14,827
5.73%, 1/16/98 5,000 4,963
Den Danske
5.50%, 12/16/97 5,000 4,989
5.52%, 12/15/97 20,000 19,957
Dover Funding, 4(2),
5.60%, 12/10/97 3,000 2,996
Dresdner U.S. Finance,
5.60%, 12/2/97 50,000 49,992
Finova Capital, 5.72%, 2/20/98 6,250 6,170
Ford Motor Credit, 5.52%, 12/4/97 5,000 4,998
General Electric Capital,
5.50%, 3/5/98 22,515 22,192
General Motors Acceptance Corporation
5.63%, 12/9/97 9,000 8,989
5.76%, 1/23/98 20,000 19,830
General RE
5.50%, 12/18/97 13,511 13,476
5.52%, 12/18/97 10,000 9,974
Golden Managers Acceptance,
5.53%, 12/2/97 8,000 7,999
Heinz (H.J.), 4(2), 5.51%, 12/2/97 50,000 49,992
International Lease Finance,
5.51%, 12/2/97 35,000 34,995
Island Finance of Puerto Rico
5.60%, 12/11/97 14,000 13,978
5.62%, 2/2/98 17,000 16,833
5.70%, 2/20/98 7,709 7,610
5.72%, 1/29/98 15,000 14,859
Jefferson Pilot
5.62%, 12/9/97 - 12/10/97 36,000 35,952
John Hancock Capital, 4(2),
5.65%, 12/1/97 50,000 50,000
KFW International Finance
5.60%, 12/8/97 4,100 4,095
5.75%, 12/1/97 50,000 50,000
Kingdom of Sweden, 5.55%, 3/2/98 33,300 32,833
Lloyds Bank PLC, 5.55%, 3/3/98 30,000 29,574
Merrill Lynch
5.52%, 12/10/97 10,000 9,986
5.53%, 12/10/97 - 12/15/97 15,100 15,071
5.70%, 2/10/98 - 2/27/98 17,670 17,470
5.74%, 1/30/98 28,000 27,732
National Rural Utilities
Cooperative Finance
5.50%, 2/17/98 - 2/20/98 21,513 21,248
New Center Asset Trust,
5.75%, 12/1/97 50,000 50,000
Nordbanken North America
5.52%, 1/12/98 37,000 36,762
5.55%, 2/20/98 2,000 1,975
Novartis Finance, 5.65%, 12/1/97 25,000 25,000
Panasonic Finance, 4(2),
5.55%, 2/6/98 40,000 39,587
Port of Corpus Christi Authority,
5.57%, 12/18/97 25,000 25,000
Preferred Receivables Funding
5.51%, 12/22/97 5,800 5,781
5.52%, 2/11/98 2,275 2,250
5.62%, 2/5/98 3,000 2,969
5.63%, 12/1/97 5,400 5,400
Progress Capital Holdings,
5.60%, 12/2/97 7,800 7,799
Province of Quebec, 5.50%, 3/9/98 14,000 13,790
Repeat Offering Security
5.70%, 2/27/98 1,073 1,058
5.73%, 2/27/98 11,800 11,635
5.75%, 2/27/98 47,305 46,640
Rio Tinto, 5.55%, 1/16/98 8,000 7,943
RTZ America, 4(2), 5.50%, 3/4/98 20,100 19,814
Santander Finance (Delaware),
5.53%, 12/3/97 25,000 24,992
SBC Communications, 5.80%, 12/1/97 50,000 50,000
Statoil (Den Norske Stats Oljeselskap)
5.60%, 12/8/97 11,500 11,488
5.65%, 12/8/97 13,500 13,485
Telstra, 5.52%, 1/23/98 20,000 19,837
Western Australian Treasury,
5.50%, 12/23/97 15,000 14,950
Total Commercial Paper (Cost
$1,599,996) 1,599,996
MEDIUM-TERM NOTES 1.8%
Tiers Trust, VR, (144a),
5.688%, 12/15/97 40,000 40,000
Toyota Motor Credit, VR,
13.642%, 3/9/98 7,700 7,858
United States Bancorp,
7.11%, 12/10/97 5,000 5,002
Total Medium-Term Notes (Cost
$52,860) 52,860
Total Investments in Securities
99.5% of Net Assets (Cost
$2,848,329) $2,848,329
Other Assets Less Liabilities 15,047
NET ASSETS $2,863,376
Net Assets Consist of:
Accumulated net realized gain/loss -
net of distributions $ (2)
Paid-in-capital applicable to 2,863,378
shares of $0.0001 par value capital
stock outstanding; 7,000,000,000 shares
of the Corporation authorized 2,863,378
NET ASSETS $2,863,376
NET ASSET VALUE PER SHARE $ 1.00
VR Variable Rate
4(2) Commercial Paper sold within terms of a private placement
memorandum, exempt from registration under section 4.2 of
the Securities Act of 1933, as amended, and may be sold
only to dealers in that program or other "accredited
investors."
144a Security was purchased pursuant to Rule 144a under the
Securities Act of 1933 and may not be resold subject to
that rule except to qualified institutional buyers --
total of such securities at period-end amounts to 1.4% of
net assets.
Government Reserve Investment Fund
Unaudited
Portfolio of Investments
November 30, 1997
Par Value
In thousands
U.S. TREASURY OBLIGATIONS 42.6%
U.S. Treasury Notes
5.00%, 1/31/98 $ 40,000 $ 39,969
5.125%, 2/28/98 - 4/30/98 30,000 29,959
6.00%, 9/30/98 10,000 10,030
6.125%, 5/15/98 10,000 10,028
6.25%, 6/30/98 20,000 20,074
7.25%, 2/15/98 50,000 50,174
Total U.S. Treasury Obligations
(Cost $160,234) 160,234
REPURCHASE AGREEMENTS 51.2%
First Boston, Dated 11/28/97, 5.60%
Delivery Value of $50,023 on 12/1/97 50,000 50,000
Goldman Sachs, Dated 11/28/97, 5.50%
Delivery Value of $42,554 on 12/1/97 42,535 42,535
Merrill Lynch, Dated 11/28/97, 5.65%
Delivery Value of $50,024 on 12/1/97 50,000 50,000
Morgan Stanley, Dated 11/28/97, 5.67%
Delivery Value of $50,024 on 12/1/97 50,000 50,000
Total Repurchase Agreements (Cost
$192,535) 192,535
Total Investments in Securities
93.8% of Net Assets (Cost $352,769) $ 352,769
Other Assets Less Liabilities 23,322
NET ASSETS $ 376,091
Government Reserve Investment Fund
Unaudited
Statement of Assets and Liabilities
November 30, 1997
In thousands
Assets
Total investments in securities, at
value (cost $352,769) $ 352,769
Receivable for investment securities
sold 20,000
Other assets 3,330
Total assets 376,099
Liabilities
Total liabilities 8
NET ASSETS $ 376,091
Net Assets Consist of:
Accumulated net realized gain/loss -
net of distributions $ (11)
Paid-in-capital applicable to
376,101,641 shares of
$0.0001 par value capital
stock outstanding;
7,000,000,000 shares of the
Corporation authorized 376,102
NET ASSETS $ 376,091
NET ASSET VALUE PER SHARE $ 1.00
Reserve Investment Funds, Inc.
Unaudited
Statement of Operations
In thousands
Government
Reserve Reserve
Investment Investment
Fund Fund
8/25/97 8/25/97
through through
11/30/97 11/30/97
Investment Income
Interest income $ 40,402 $ 7,016
Expenses
Custody and accounting 33 22
Legal and audit 2 2
Miscellaneous 1 1
Total expenses 36 25
Net investment income 40,366 6,991
Realized Gain (Loss)
Net realized gain (loss) on securities (2) (11)
INCREASE (DECREASE) IN NET
ASSETS FROM OPERATIONS $ 40,364 $ 6,980
Reserve Investment Funds, Inc.
Unaudited
Statement of Changes in Net Assets
In thousands
Government
Reserve Reserve
Investment Investment
Fund Fund
8/25/97 8/25/97
through through
11/30/97 11/30/97
Increase (Decrease) in Net Assets
Operations
Net investment income $ 40,366 $ 6,991
Net realized gain (loss) (2) (11)
Increase (decrease) in net
assets from operations 40,364 6,980
Distributions to shareholders
Net investment income (40,366) (6,991)
Capital share transactions*
Shares sold 6,130,882 1,479,428
Distributions reinvested 40,367 6,991
Shares redeemed (3,307,921) (1,110,367)
Increase (decrease) in net
assets from capital
share transactions 2,863,328 376,052
Net Assets
Increase (decrease) during period 2,863,326 376,041
Beginning of period 50 50
End of period $2,863,376 $ 376,091
*Share information
Shares sold 6,130,882 1,479,428
Distributions reinvested 40,367 6,991
Shares redeemed (3,307,921) (1,110,367)
Increase (decrease) in shares
outstanding 2,863,328 376,052
Reserve Investment Funds, Inc.
Unaudited
November 30, 1997
Notes To Financial Statements
Reserve Investment Funds, Inc. (the corporation) is registered
under the Investment Company Act of 1940 (the Act) as a
diversified, open-end management investment company. Reserve
Investment Fund (Reserve Fund) and Government Reserve Investment
Fund (Government Reserve Fund), are the two portfolios
established by the corporation and commenced operations on August
25, 1997.
The Reserve Investment Funds are offered as cash management
options only to mutual funds and other accounts managed by T.
Rowe Price and its affiliates and are not available to the
public. Reserve Fund seeks preservation of capital, liquidity,
and, consistent with these, the highest possible current income,
through investments primarily in high-quality, money market
securities. Government Reserve Fund's objectives are to maximize
stability of capital, liquidity, and, consistent with these, the
highest possible current income, through investments primarily in
U.S. Treasury securities.
Note 1 - Significant Accounting Policies
Basis of Preparation
The accompanying financial statements are prepared in accordance
with generally accepted accounting principles for the investment
company industry; these principles may require the use of
estimates by fund management.
Valuation
Securities are valued at amortized cost. Assets and liabilities
for which such valuation procedures are deemed not to reflect
fair value are stated at fair value as determined in good faith
by or under the supervision of the officers of the fund, as
authorized by the Board of Directors.
Premiums and discounts
Premiums and discounts on debt securities are amortized for both
financial reporting and tax purposes.
Distributions
Distributions to shareholders are recorded on the ex-dividend
date. Income and capital gain distributions to the funds'
shareholders are determined in accordance with federal income tax
regulations, which may differ from generally accepted accounting
principles. Federal Income TaxesNo provision for federal income
taxes is required since each fund intends to qualify as a
regulated investment company and distribute all of its taxable
income.
Other
Income and expenses are recorded on the accrual basis.
Investment transactions are accounted for on the trade date.
Realized gains and losses are reported on the identified cost
basis.
Note 2 - Investment Transactions
Repurchase Agreements
All repurchase agreements are fully collateralized by U.S.
government securities. Collateral is in the possession of the
fund's custodian and is evaluated daily to ensure that its market
value exceeds the delivery value of the repurchase agreements at
maturity. Although risk is mitigated by the collateral, the fund
could experience a delay in recovering its value and a possible
loss of income or value if the counterparty fails to perform in
accordance with the terms of the agreement.
Note 3 - Federal income taxes
At November 30, 1997, the aggregate cost of investments for
federal income tax and financial reporting purposes was
$2,848,329,000 for the Reserve Fund and $352,769,000 for the
Government Reserve Fund.
Note 4 - Related Parties
T. Rowe Price Associates, Inc. (T. Rowe Price) is the investment
manager for the Reserve and Government Reserve Funds. T. Rowe
Price or its affiliates also provide investment management
services to all shareholders of the Reserve Investment Funds. The
Reserve and Government Reserve Funds pay no management fees;
however, T. Rowe Price and its affiliates receive management fees
from managing the assets invested in the Reserve and Government
Reserve Funds.
T. Rowe Price and its wholly-owned subsidiaries provide transfer
and dividend disbursing agent, accounting, shareholder,
administrative, and certain other services to the Reserve and
Government Reserve Funds. The Reserve Fund incurred expenses
pursuant to these related party agreements totaling approximately
$15,000 for the six months ended November 30, 1997, of which
$5,000 was payable at period-end. The Government Reserve Fund
incurred expenses pursuant to these agreements totaling
approximately $15,000 for the six months ended November 30, 1997,
of which $5,000 was payable at period-end.
Certain officers and directors of the Reserve and Government
Reserve Funds are also officers and directors of T. Rowe Price,
its affiliates, and those invested in the Reserve Investment
Funds.
