DREYFUS INSTITUTIONAL PREFERRED MONEY MARKET FUND
- -----------------------------------------------------------------------------
LETTER TO SHAREHOLDERS
Dear Shareholder:
We are pleased to provide you with this report on the Dreyfus Institutional
Preferred Money Market Fund for the six-month period ended September 30, 1998.
For the period, your Fund produced an annualized yield of 5.57% and, after
taking into account the effect of compounding, the annualized effective yield
was 5.72%.*
Economic Review
So far in 1998, the main regions of the world have had very different economic
fundamentals. The U.S. entered the year with a strong economy near full
employment, with unemployment only slightly above 4%. The tight labor market led
the Federal Reserve to contemplate raising interest rates early in the year. The
U.S. economy cooled enough that the Fed decided to stand pat for a number of
months before cutting the Federal Funds rate in September and October. Evidence
of economic cooling continued to accumulate and worries about the world economy
intensified. World economic weakness then shifted expectations towards monetary
easing. After many years of subpar economic growth, continental Europe moved
into a better economic expansion. Unlike the U.S., Europe has substantial excess
capacity of productive plant and labor. In Asia, weak economies were pervasive
as a result of the Asian financial crisis. The Latin American economies weakened
as the financial stresses spread throughout that region.
A main influence on the U.S. economy this year was the foreign financial
crisis and cooling of the world economy. The positive effects hit first. Actual
inflation and expected inflation dropped, causing a decline in long-term
Treasury bond yields and mortgage rates. This caused a boom in housing. The fall
in inflation helped the consumer sector as more of the growth in consumer income
was left over after inflation to buy goods and services. Consumers benefited
from a combination of good growth in income after inflation, a strong labor
market and past increases in the prices of assets they owned.
The negative effect of Asian weakness was directed towards the industrial
sector more than the consumer sector. Corporate profits weakened, especially in
sectors sensitive to Asia such as world-traded commodities (oil, metals and
paper) and exports. One result of the industrial weakness was to cool off a U.S.
economy that had been growing rapidly.
The major change in the economic outlook over recent months has been a
downward shift in expectations for world economic growth. A credit crunch
developed in emerging countries and former communist countries, sharply reducing
the economic outlook for Asia and Latin America as well as for
commodity-exporting countries throughout the world. The effect on Europe and the
U.S. has been to lower expectations of profit growth and drive down bond yields
Market sentiment now anticipates further monetary easing in the U.S. and other
industrial countries as the evidence of a weaker world economy has accumulated.
There appears to be a shift in the priorities of key policymakers from fighting
potential inflation to restimulating future world economic growth.
Market Environment/Portfolio Focus
The economic forces described above drove down interest rates in late summer
and early fall, finally breaking them out of the narrow band that had prevailed
earlier in the year.
A notable result was that a worldwide "flight to safety" generated very high
demand for U.S. Treasury securities in longer maturities, thus driving their
yields down. Meanwhile, yields on money market instruments remained strong, at
times causing an inverted yield curve.
Clearly, the market was expecting a reduction in overnight lending rates, and
on September 29th, the Fed confirmed this by lowering its Federal Funds rate
from 5.50% to 5.25%. The extent of the easing was less than the market had been
expecting. However, in an unexpected move, the Fed lowered the Federal Funds
rate on October 15 to 5.00% as well as the Discount rate from 5.00% to 4.75%.
The market continues to reflect anticipation of additional easing.
At home as well as abroad, money market participants are now more concerned
about the possibility of recession than the fear of inflation.
To deal with these market conditions, we have been maintaining average
maturities somewhat longer than the industry average, on the premise that rates
may continue on a downward curve in the immediate future. Of course, we are
prepared to shift gears, should this be required by changes in the market
outlook.
Sincerely
[Patricia A. Larkin signature logo]
Patricia A. Larkin
Senior Portfolio Manager
October 20, 1998
New York, N.Y.
*Annualized effective yield is based on dividends declared daily and reinvested
monthly.
<TABLE>
DREYFUS INSTITUTIONAL PREFERRED MONEY MARKET FUND
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STATEMENT OF INVESTMENTS SEPTEMBER 30, 1998 (UNAUDITED)
Principal
Negotiable Bank Certificates of Deposit--24.9% Amount Value
- ------------------------------------------------------- _______________ _______________
Abbey National Treasury Services (Yankee)
<S> <C> <C>
5.72%, 1/27/99 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 25,000,000 $ 25,000,000
Bankers Trust Co.
5.64%, 7/23/99 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,000,000 19,990,031
Bayerishe Landesbank (Yankee)
5.69%, 5/6/99 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,000,000 24,997,631
Credit Agricole Indosuez S.A. (Yankee)
5.50%, 1/14/99 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,000,000 10,000,000
Creditanstalt Bankverein (Yankee)
5.77%, 4/16/99 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,000,000 24,993,538
Deutsche Bank AG (Yankee)
5.70%, 3/22/99 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30,000,000 29,992,549
Rabobank Nederland N.V. (Yankee)
5.81% , 5/5/99 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40,000,000 39,992,988
Royal Bank of Canada (Yankee)
5.61%, 2/23/99 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50,000,000 49,987,466
Societe Generale (Yankee)
5.61%-5.80%, 10/9/98-5/28/99 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65,000,000 64,984,499
Suedwestdeutsche Landesbank (London)
5.50%, 12/8/98 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50,000,000 50,001,706
SwedBank (Yankee)
5.70%-5.79%, 10/5/98-7/12/99 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55,000,000 54,996,645
Westdeutsche Landesbank Girozentrale (Yankee)
5.51%, 1/11/99 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,000,000 25,000,000
_______________
TOTAL NEGOTIABLE BANK CERTIFICATES OF DEPOSIT
(cost $419,937,053) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 419,937,053
_______________
Commercial Paper--42.6%
- -------------------------------------------------------
ABN-AMRO North America Finance Inc.
5.70%, 1/4/99 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 25,000,000 $ 24,637,813
Associates Corp. of North America
5.78%, 10/1/98 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45,000,000 45,000,000
Bankers Trust N.Y. Corp.
5.57%, 10/23/98 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30,000,000 29,901,917
Ciesco L.P.
5.50%-5.52%, 10/2/98-11/24/98 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75,000,000 74,587,431
Den Norske Bank ASA
5.67%, 11/9/98 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35,000,000 34,791,079
Deutsche Bank Financial Inc.
5.57%, 10/15/98 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30,000,000 29,935,600
DREYFUS INSTITUTIONAL PREFERRED MONEY MARKET FUND
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STATEMENT OF INVESTMENTS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
Principal
Commercial Paper (continued) Amount Value
- ------------------------------------------------------- _______________ _______________
Finova Capital Corp.
5.61%-5.74%, 11/6/98-2/22/99 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 64,000,000 $ 63,131,700
General Electric Capital Corp.
5.59%-5.64%, 11/3/98-1/29/99 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50,000,000 49,416,000
General Electric Capital Services Inc.
5.52%-5.59%, 11/2/98-11/3/98 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45,000,000 44,776,256
General Electric Co.
5.57%, 12/31/98 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50,000,000 49,309,917
Goldman Sachs Group L.P.
5.55%, 10/16/98 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,000,000 19,954,084
Hertz Corp.
5.51%-5.61%, 10/2/98-11/6/98 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80,000,000 79,828,200
Merrill Lynch & Co. Inc.
5.67%, 1/29/99 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40,000,000 39,265,333
Morgan (J.P.) & Co. Inc.
5.43%, 1/25/99 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,000,000 24,570,639
Morgan Stanley, Dean Witter & Co.
5.61%-5.64%, 1/22/99-2/12/99 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65,000,000 63,756,255
National Rural Utilities Cooperative Finance Corp.
5.50%-5.52%, 11/6/98-11/10/98 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39,712,000 39,474,281
Swedbank Inc.
5.66%, 2/5/99 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,000,000 4,902,986
_______________
TOTAL COMMERCIAL PAPER
(cost $717,239,491) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 717,239,491
_______________
Corporate Notes--10.4%
- -------------------------------------------------------
BankBoston N.A.
5.66%, 1/11/99 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 40,000,000 $ 39,995,705
Bankers Trust N.Y. Corp.
5.70%, 1/8/99 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,000,000 9,999,471
CIT Group Holdings, Inc.
5.63%-5.67%, 1/12/99-9/29/99 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75,000,000 74,988,505
Istituto Bancario San Paolo Di Torino
5.63%, 4/19/99 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,000,000 24,994,038
Merrill Lynch & Co. Inc.
5.62%, 4/19/99 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,000,000 5,000,000
Paine Webber Group Inc.
5.70%, 1/4/99 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,000,000 20,000,000
_______________
TOTAL CORPORATE NOTES
(cost $174,977,719) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 174,977,719
_______________
DREYFUS INSTITUTIONAL PREFERRED MONEY MARKET FUND
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STATEMENT OF INVESTMENTS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
Principal
Promissory Notes--3.4% Amount Value
- ------------------------------------------------------- _______________ _______________
Goldman Sachs Group L.P.
5.60%-5.87%, 10/2/98-11/12/98 (b,c)
(cost $57,000,000) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 57,000,000 $ 57,000,000
_______________
Short-Term Bank Notes--15.5%
- -------------------------------------------------------
BankBoston N.A.
5.63%, 11/2/98 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 7,000,000 $ 7,000,000
First Union National Bank
5.61%, 7/23/99 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50,000,000 50,000,000
Harris Trust & Savings Bank
5.50%-5.57%, 10/6/98-11/4/98 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70,000,000 70,000,000
Lasalle National Bank
5.61%-5.70%, 2/3/99-7/16/99 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55,000,000 54,995,359
PNC Bank NA
5.56%-5.62%, 5/21/99-6/4/99 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55,000,000 54,972,722
SouthTrust Bank N. A.
5.61%, 7/6/99 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,000,000 24,988,847
_______________
TOTAL SHORT-TERM BANK NOTES
(cost $261,956,928) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 261,956,928
_______________
Time Deposits--2.3%
- -------------------------------------------------------
Bayerische Vereinsbank (Grand Cayman)
5.88%, 10/1/98 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 18,000,000 $ 18,000,000
Berliner Handels-und Frankforter Bank (Grand Cayman)
6.00%, 10/1/98 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,000,000 20,000,000
_______________
TOTAL TIME DEPOSITS
(cost $38,000,000) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 38,000,000
_______________
TOTAL INVESTMENTS
(cost $1,669,111,191) . . . . . . . . . . . . . . . . . . . . . . . . . . . 99.1% $1,669,111,191
_______ _______________
CASH AND RECEIVABLES (NET) . . . . . . . . . . . . . . . . . . . . . . . . . . .9% $ 15,052,286
_______ _______________
NET ASSETS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 100.0% $1,684,163,477
_______ _______________
Notes to Statement of Investments:
- -----------------------------------------------------------------------------
(a) Variable interest rate-subject to periodic change.
(b)These notes were acquired for investment, and not with the intent to
distribute or sell.
(c)Security restricted as to public resale. This security was acquired from
10/2/98-11/2/98 at a cost of par value. At September 30, 1998, the aggregate
value of this security was $57,000,000 representing approximately 3.4% of net
assets and is valued at amortized cost.
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<TABLE>
DREYFUS INSTITUTIONAL PREFERRED MONEY MARKET FUND
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STATEMENT OF ASSETS AND LIABILITIES SEPTEMBER 30, 1998 (UNAUDITED)
Cost Value
_______________ _______________
<S> <C> <C>
ASSETS: Investments in securities--See Statement of Investments . . $1,669,111,191 $1,669,111,191
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . 727,468
Receivable for investment securities sold . . . . . . . . 25,162,403
Interest receivable . . . . . . . . . . . . . . . . . . . 14,368,926
_______________
1,709,369,988
_______________
LIABILITIES: Due to The Dreyfus Corporation and affiliates . . . . . . 190,280
Payable for investment securities purchased . . . . . . . 25,000,370
Accrued expenses . . . . . . . . . . . . . . . . . . . . 15,861
_______________
25,206,511
_______________
NET ASSETS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,684,163,477
_______________
REPRESENTED BY: Paid-in capital . . . . . . . . . . . . . . . . . . . . . $1,684,194,469
Accumulated net realized gain (loss) on investments . . . (30,992)
_______________
NET ASSETS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,684,163,477
_______________
SHARES OUTSTANDING
(UNLIMITED NUMBER OF $.001 PAR VALUE SHARES OF BENEFICIAL INTEREST AUTHORIZED) . . . . . . 1,684,194,469
NET ASSET VALUE, offering and redemption price per share . . . . . . . . . . . . . . . . . $1.00
______
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<TABLE>
DREYFUS INSTITUTIONAL PREFERRED MONEY MARKET FUND
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STATEMENT OF OPERATIONS SIX MONTHS ENDED SEPTEMBER 30, 1998 (UNAUDITED)
INVESTMENT INCOME
<S> <C> <C>
INCOME Interest Income . . . . . . . . . . . . . . . . . . . . . $41,729,678
EXPENSES Management Fee--Note 2(a) . . . . . . . . . . . . . . . . 735,724
____________
INVESTMENT INCOME--NET . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40,993,954
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS--Note 1(b). . . . . . . . . . . . . (28,200)
____________
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS . . . . . . . . . . . . . . . . . . . $40,965,754
____________
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<TABLE>
DREYFUS INSTITUTIONAL PREFERRED MONEY MARKET FUND
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STATEMENT OF CHANGES IN NET ASSETS
Six Months Ended
September 30,1998 Period
Ended
(Unaudited) March 31, 1998*
__________________ __________________
OPERATIONS:
<S> <C> <C>
Investment income--net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 40,993,954 $ 48,129,471
Net realized gain (loss) from investments . . . . . . . . . . . . . . . . . . . . (28,200) (2,792)
_______________ _______________
Net Increase (Decrease) in Net Assets Resulting from Operations . . . . . . . 40,965,754 48,126,679
_______________ _______________
DIVIDENDS TO SHAREHOLDERS FROM:
Investment income--net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (40,993,954) (48,129,471)
_______________ _______________
BENEFICIAL INTEREST TRANSACTIONS ($1.00 per share):
Net proceeds from shares sold . . . . . . . . . . . . . . . . . . . . . . . . . . 3,651,509,431 5,663,121,791
Dividends reinvested . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40,483,820 47,609,227
Cost of shares redeemed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3,504,427,897) (4,214,201,903)
_______________ _______________
Increase (Decrease) in Net Assets from Beneficial Interest Transactions . . . 187,565,354 1,496,529,115
_______________ _______________
Total Increase (Decrease) in Net Assets . . . . . . . . . . . . . . . . . 187,537,154 1,496,526,323
NET ASSETS
Beginning of period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,496,626,323 100,000
_______________ _______________
End of period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,684,163,477 $1,496,626,323
_______________ _______________
- -----------------------------
* From June 11, 1997 (commencement of operations) to March 31, 1998.
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<TABLE>
DREYFUS INSTITUTIONAL PREFERRED MONEY MARKET FUND
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FINANCIAL HIGHLIGHTS
Contained below is per share operating performance data for a share of
Beneficial Interest outstanding, total investment return, ratios to average net
assets and other supplemental data for each period indicated. This information
has been derived from the Fund's financial statements.
Six Months Ended
September 30, 1998 Period Ended
PER SHARE DATA: (Unaudited) March 31, 1998(1)
__________________ __________________
<S> <C> <C>
Net asset value, beginning of period . . . . . . . . . . . . . . . . . $ 1.00 $ 1.00
______ ______
Investment Operations:
Investment income--net . . . . . . . . . . . . . . . . . . . . . . . . .028 .046
______ ______
Distributions:
Dividends from investment income--net . . . . . . . . . . . . . . . . . (.028) (.046)
______ ______
Net asset value, end of period . . . . . . . . . . . . . . . . . . . . $ 1.00 $ 1.00
______ ______
______ ______
TOTAL INVESTMENT RETURN. . . . . . . . . . . . . . . . . . . . . . . . . . 5.64%(2) 5.76%(2)
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets . . . . . . . . . . . . . . . . .10%(2) .10%(2)
Ratio of net investment income to average net assets . . . . . . . . . 5.57%(2) 5.64%(2)
Net Assets, end of period (000's Omitted) . . . . . . . . . . . . . . . $1,684,163 $1,496,626
- ------------------------
(1) From June 11, 1997 (commencement of operations) to March 31, 1998.
(2) Annualized.
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
DREYFUS INSTITUTIONAL PREFERRED MONEY MARKET FUND
- -----------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
NOTE 1--SIGNIFICANT ACCOUNTING POLICIES:
Dreyfus Institutional Preferred Money Market Fund (the "Fund") is registered
under the Investment Company Act of 1940, as amended (the "Act" ) as a
diversified open-end management investment company. The Fund' s investment
objective is to provide investors with as high a level of current income as is
consistent with the preservation of capital and the maintenance of liquidity.
The Dreyfus Corporation (the "Manager") serves as the Fund's investment adviser.
The Manager is a direct subsidiary of Mellon Bank, N.A. Premier Mutual Fund
Services, Inc. is the distributor of the Fund's shares, which are sold to the
public without a sales charge.
It is the Fund's policy to maintain a continuous net asset value per share of
$1.00; the Fund has adopted certain investment, portfolio valuation and dividend
and distribution policies to enable it to do so. There is no assurance, however,
that the Fund will be able to maintain a stable net asset value per share of
$1.00.
The Fund' s financial statements are prepared in accordance with generally
accepted accounting principles which may require the use of management estimates
and assumptions. Actual results could differ from those estimates.
(A) PORTFOLIO VALUATION: Investments in securities are valued at amortized
cost, which has been determined by the Fund's Board of Trustees to represent the
fair value of the Fund's investments.
(B) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities transactions are
recorded on a trade date basis. Realized gain and loss from securities
transactions are recorded on the identified cost basis. Interest income is
recognized on the accrual basis. Cost of investments represents amortized cost.
Under the terms of the custodian agreement, the Fund receives net earnings
credits based on available cash balances left on deposit.
(C) DIVIDENDS TO SHAREHOLDERS: It is the policy of the Fund to declare
dividends daily from investment income-net. Such dividends are paid monthly.
Dividends from net realized capital gain, if any, are normally declared and paid
annually, but the Fund may make distributions on a more frequent basis to comply
with the distribution requirements of the Internal Revenue Code of 1986, as
amended (the "Code" ). To the extent that a net realized capital gain can be
offset by capital loss carryovers, it is the policy of the Fund not to
distribute such gain.
(D) FEDERAL INCOME TAXES: It is the policy of the Fund to continue to qualify
as a regulated investment company, if such qualification is in the best
interests of its shareholders, by complying with the applicable provisions of
the Code, and to make distributions of taxable income sufficient to relieve it
from substantially all Federal income and excise taxes.
The Fund has an unused capital loss carryover of approximately $57 available
for Federal income tax purposes to be applied against future net securities
profits, if any, realized subsequent to March 31, 1998. The carryover does not
include net realized securities losses from November 1, 1997 through March 31,
1998, which are treated, for Federal income tax purposes, as arising in fiscal
1999. If not applied, the carryover expires in fiscal 2006.
At September 30, 1998, the cost of investments for Federal income tax purposes
was substantially the same as the cost for financial reporting purposes (see the
Statement of Investments).
NOTE 2--MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES:
(A) Pursuant to a management agreement with the Manager, the management fee is
computed at the annual rate of .10 of 1% of the value of the Fund's average
daily net assets and is payable monthly. The Manager has agreed to pay all of
the Fund's expenses except the management fee.
The Manager compensates Dreyfus Transfer, Inc., a wholly-owned subsidiary of
the Manager, under a transfer agency agreement for providing personnel and
facilities to perform transfer agency services for the Fund.
(B) Each trustee receives an annual fee of $1,000 and an attendance fee of
$250 per meeting. The Chairman of the Board receives an additional 25% of such
compensation.
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Dreyfus lion "d" logo (reg.tm)
Dreyfus logo (reg.tm)
DREYFUS INSTITUTIONAL PREFERRED
MONEY MARKET FUND
200 Park Avenue
New York, NY 10166
MANAGER
The Dreyfus Corporation
200 Park Avenue
New York, NY 10166
CUSTODIAN
The Bank of New York
90 Washington Street
New York, NY 10286
TRANSFER AGENT &
DIVIDEND DISBURSING AGENT
Dreyfus Transfer, Inc.
P.O. Box 9671
Providence, RI 02940
Printed in U.S.A. 194SA989
Institutional
Preferred Money
Market Fund
Semi-Annual
Report
September 30, 1998
