WM TRUST I, N-30D, 2000-01-11

WM TRUST I
N-30D, 2000-01-11

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<PAGE>
[logo] WM
GROUP of FUNDS

[graphic omitted]

MONEY MARKET
FUNDS

----------------------------
THE DIFFERENCE IS EXPERIENCE
----------------------------

ANNUAL REPORT
FOR THE YEAR ENDED OCTOBER 31, 1999

<PAGE>
[graphic omitted]

MONEY FUNDS

money market fund

tax-exempt money market fund

california money fund

CONTENTS
- --------------------------------------------------------------------------------
message from the president 1
events of the century 2
diversifying your portfolio and managing risk 5
individual fund reviews 7
statements of assets and liabilities 8
statements of operations 10
statements of changes in net assets 11
statements of changes in net assets - capital stock activity 15
financial highlights 18
portfolio of investments 24
notes to financial statements 24
independent auditor's report 36
tax information (unaudited) 37

<PAGE>

[Photo of William G. Papesh]

DEAR SHAREHOLDER,

The decade, the century, and the millennium are simultaneously drawing to a
close. To the typical investor, the more recent past is likely of greatest
interest. From 1990 through October 31, 1999, the value of the U.S. stock market
rose nearly 400%, as measured by the S&P 500(1). The 1990s also saw one of the
longest-running economic expansions on record. However, compared to other
historic investment events of this century, the 1990s are perhaps not all that
remarkable.

This year, our fund family celebrates its 60th year in the investment management
business. Our time-honored tradition dates to 1939 when Composite Research &
Management Co. (now known as WM Advisors) launched the Bond & Stock Fund, which
was one of the first 50 mutual funds in the U.S. Today, investors can choose
from more than 11,000 mutual funds. In the intervening 60 years, the investment
landscape has been permanently altered, first by theoretical advances in finance
and then by innovations in computer technology. We have managed stock and bond
investments through six decades of changing market environments, including World
War II, the Vietnam War, wage and price controls, the stock market crash of
1987, and 10 recessions. Throughout these events, our approach to investing has
remained the same, defined by rigorous research, a commitment to outstanding
performance, and a value-oriented investment philosophy.

From the beginning, the WM Group of Funds has recognized the value of
diversification in managing investment portfolios. By combining bond and stock
investments in a single portfolio in the 1930s, the Bond & Stock Fund sought to
offer investors a convenient and professionally managed investment vehicle
designed to weather the storms of changing market conditions. Of course, the
theory of diversification - which created a means to mathematically measure the
actual and potential risk-reduction benefits of investing in a diversified
portfolio - did not arise until the 1950s. Since then, computer technology has
led to more sophisticated asset allocation models such as those employed in
managing the WM Strategic Asset Management Portfolios. The addition of the
International Growth Fund to the WM Group of Funds family has provided expanded
opportunities for individuals to craft a well-diversified portfolio.

The importance of diversification in managing investment risk was evident in the
financial market results this year. During the 12-month period ended October 31,
1999, both U.S. and foreign stock markets posted strong gains, with the S&P 500
up 25.67% and the Morgan Stanley Capital International (MSCI) Europe,
Australasia and the Far East (EAFE) index rising 23.67%(2). A combination of low
inflation, strong economic growth and continued consumer spending helped sustain
corporate earnings and the U.S. market. Internationally, higher share prices in
Japan and a recovery from last year's currency crisis in Pacific Rim countries
helped boost the international index. However, U.S. bond markets declined during
the same period in response to actions by the Federal Reserve to raise interest
rates to forestall potential increases in inflation.

As is often the case, stock and bond markets moved in opposite directions
through much of 1999. Bond investors, who included some stock investments in
their portfolios, probably fared better than those who held only fixed-income
investments. Those who invested primarily in stock funds may have experienced
most of their gains in the first six months of 1999, as the S&P 500 posted a
6.24% decline from the end of June to the end of September(1). Including a small
allocation to bonds and bond funds in an equity portfolio can potentially help
temper risk and, over time, result in higher long-term returns.

Your Investment Representative can help you select an appropriate mix of
investments for your portfolio based on your financial goals. Whether you are
seeking current income or long-term capital appreciation, the WM Group of Funds
offers investment vehicles designed to meet your goals and financial needs. For
example, the Strategic Asset Management (SAM) Portfolios provide the convenience
of immediate diversification and the advantages of professionally-managed asset
allocation through changing market conditions. For more information about
additional strategies that can help you pursue your financial objectives, speak
with your Investment Representative.

As the new millennium approaches, we look forward to continuing to leverage our
experience and history to meet the investment challenges of tomorrow. Thank you
for your continued confidence in the WM Group of Funds.

Sincerely,

/s/ William G. Papesh

William G. Papesh
President

(1) Source: Standard & Poor's. The S&P 500 is an unmanaged index of common
stocks. Results include reinvestment of dividends.

(2) The Morgan Stanley Capital International Europe, Australasia and the Far
East (MSCI EAFE) index is a market capitalization weighted index designed to
measure the performance of 23 developed markets worldwide.

Past performance is no guarantee of future results. Individuals cannot invest
directly in any index.

<PAGE>

[graphic omitted]

EVENTS OF THE CENTURY

SHAPING THE DOW JONES INDUSTRIAL AVERAGE

As we move toward the beginning of the new millennium, it is important to
examine the events of the last century in order to gain some insight to the
future. During the past 100 years, we have witnessed tremendous change and have
overcome much adversity, and through it all, economies and markets have
continued to grow and expand. Despite two World Wars, the Great Depression, and
the rise and fall of Communism, equity markets in the United States have
increased more than 16,000% (as measured by the Dow Jones Industrial
Average).(2) Events of the past century have completely reshaped the way we live
and conduct business - and during this time, companies have flourished and often
times dramatically increased in value. By highlighting these major events, we
can examine their impact on the growth of the financial markets and the upward
trajectory of the Dow.

THE BIRTH OF U.S. STEEL CORP. 1901

On March 3, 1901, the merger between J.P. Morgan and Carnegie Steel created the
first billion-dollar corporation that controlled nearly two-thirds of the
nation's steel market.

THE WRIGHT BROTHERS TAKE FLIGHT 1903

On a beach near Kitty Hawk, North Carolina, Orville and Wilbur Wright used a
12-horsepower engine to fly 120 feet in 12 seconds. This signified the birth of
an industry that would eventually speed world travel, affect the outcome of
wars, and generate billions of dollars.

THE SAN FRANCISCO EARTHQUAKE 1906

On April 18, 1906, a major earthquake shook San Francisco and started fires that
destroyed the entire city. It took years to rebuild the nearly 20,000 buildings
destroyed in the quake. The Creation of the Ford Assembly Line 1913 Henry Ford
revolutionized the concept of mass production, increasing efficiencies and
cutting costs of the Model T, as the division of labor was born.

WORLD WAR I BEGINS 1914

The assassination of Austria-Hungary's Archduke Francis Ferdinand and his wife
in June 1914 led to war against Serbia. Pre-existing alliances drew in nearly
every European nation, and World War I was underway.

PANAMA CANAL OPENED 1914

In August 1914, world trade would forever be altered as the Panama Canal was
opened. The Canal drastically shortened shipping time and cost between the
Atlantic and Pacific Oceans.

WOMEN'S SUFFRAGE 1920

Stemming from an 1848 convention in Seneca Falls, the suffrage amendment was
finally ratified nationally in August 1920.

FIRST COMMERCIAL RADIO BROADCAST 1920

Westinghouse burst into the mainstream by broadcasting the first commercial
radio event on November 2, 1920. The company announced the results of the
Cox/Harding presidential election and, as a result, generated huge sales of
wireless sets.

THE STOCK MARKET CRASH 1929

In October 1929, panic shook the U.S. stock market, with investors eventually
losing $30 billion, or the equivalent of nearly one-third of the entire
country's economic output.

THE GREAT DEPRESSION 1932

The Depression reached its peak in 1932 with more than 25% of the workforce
unemployed, thousands of bank failures, and more than a million homeless people
wandering the streets.

SOCIAL SECURITY CREATED 1935

An important part of FDR's New Deal, the passing of the Social Security Act
created the first pension system for American workers.

UNIONS GAIN STRENGTH 1937

A sit-down strike organized by the United Auto Workers (UAW) turned violent as
riots broke out in Flint, Michigan. Labor won an important battle when General
Motors, facing substantial losses from a complete shutdown, signed an agreement
that gave UAW tremendous power in negotiation.

BOMBING OF PEARL HARBOR 1941

On December 7, 1941, 183 planes attacked unsuspecting Pearl Harbor, destroying
multiple ships and signaling the end to an isolationist stance and a beginning
to U.S. involvement in World War II.

ENIAC INTRODUCED 1946

Engineer Presper Eckert and physicist John Mauchly introduced the world's first
digital computer at the University of Pennsylvania. The beast weighed 30 tons
and covered 1,800 square feet. The two men later unveiled UNIVAC, the first
business computer and an important symbol of the beginning of what would be the
technological revolution.

THE BABY BOOM BEGINS 1947

The end of the Depression and World War II triggered the highest birthrate in
the history of the nation as the Baby Boom generation brought unprecedented
prosperity.

COLD WAR BEGINS WITH THE KOREAN WAR 1950

Communist North Korean troops invaded South Korea, eventually securing backing
from China, as United Nations forces fought to a standoff around the 38th
parallel.

TELEVISION ASSERTS ITS DOMINANCE 1954

Signifying the beginning of an era, television finally overtook radio in annual
revenues with over $590 million. Many of the biggest entertainers had already
made the jump to TV, as the set became a fixture in the American home.

RUSSIANS ENTER SPACE WITH SPUTNIK 1957

On October 4, 1957, the Soviet Union launched Sputnik, the first satellite to
enter outer space. This launch signaled the beginning of the space race, an
important aspect of the Cold War.

CUBAN MISSILE CRISIS 1962

It was late October 1962 when U.S. spy planes spotted a buildup of Russian
nuclear missiles in Cuba, less than one hundred miles from U.S. shores. Kennedy
responded with a full blockade and both countries stood at military readiness
for nearly a week. Finally, on October 28, the Russians agreed to remove the
weapons from Cuba.

JFK ASSASSINATED 1963

In Dallas, Texas, while campaigning for the 1964 presidential election,
President Kennedy was shot and killed, sending the nation into mourning.

MAN LANDS ON THE MOON 1969

On July 16, 1969, with hundreds of millions watching on television, astronaut
Neil Armstrong became the first person to set foot on the moon's surface.

THE U.S. LEAVES VIETNAM 1973

Following years of criticism and protest in the United States, a cease-fire was
signed on January 27, 1973, and the remaining troops in Vietnam were sent home.
Vietnam united under a communist regime two years later.

OIL EMBARGO 1973

War erupted between Arabs and Israelis in October 1973 and OPEC responded by
dramatically increasing the price of oil and cutting supplies to countries
supporting Israel. The embargo lasted six months and had a significant impact on
the U.S. economy, effectively ending the post-WWII economic boom.

[graphic omitted]

PRESIDENT NIXON RESIGNS 1974

Faced with impeachment stemming from the Watergate scandal, President Richard
Nixon resigned, and Gerald Ford took over control of the oval office.

RUNAWAY INFLATION 1980

For the first time in modern history, 1980 ends with back-to-back years of
double-digit inflation. Disgruntled by the economic situation, the American
public elected Ronald Reagan, who would bring an end to 50 years of strong
government involvement in economic programs.

BLACK MONDAY STOCK MARKET CRASH 1987

In October 1987, a thriving stock market came to a crash as fears over rising
inflation and interest rates caused a massive selloff in the equity markets.

FALL OF THE BERLIN WALL 1989

What had become the symbol of a divided Germany and a divided world of
Capitalism versus Communism, the Berlin Wall fell and Germany was united.

INTRODUCTION OF THE WORLD WIDE WEB 1993

Programmers at the University of Illinois released software that enabled any
computer to access the World Wide Web, forever changing the way business is
conducted.

PRESIDENTIAL IMPEACHMENT 1998

A scandal in the White House commanded global attention as Bill Clinton, the
impeached president, remained in office when he retained Senate votes.

BUDGET SURPLUSES 1999

With the close of the fiscal year in September 1999, the U.S. reported its
second consecutive budget surplus, marking the first surpluses since 1969. The
century closes in the midst of one of the longest lasting economic and stock
market expansions.

While these major events of the past century have significantly changed our
lives, the principles of long-term investing have remained true. The fundamental
strength of U.S. companies over the long term is what has continued to drive
equity markets higher. World Wars have come and gone, but investment principles
remain firmly in tact. Rather than being unduly concerned with short-term market
fluctuations, it is important to maintain your long-term focus and continue to
invest as we move into the next century.

(1) Source of historical data: Time-Life Books
(2) Source: Bloomberg Business News and Dow Jones. All Dow Jones Index
information is based on the month-end closing values. The Dow Jones
Industrial Average (DJIA) is an unmanaged index of industrial stocks that is
often used to measure the overall U.S. equity market. Individuals cannot
invest directly in an index. Chart uses logarithmic scale.

[graphic omitted]

<TABLE>
<CAPTION>
1900 1910 1920
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Birth of U.S. Wright Bros. San Francisco Ford Asembly World War I Women's Sufferage The Stock
Steel Corp. Dow 49.11 Earthquake Line Begins Dow 86.16 Market Crash
Dow 69.43 Dow 90.53 Dow 78.78 Dow 71.42 Dow 273.51
First Commercial
Panama Canal Radio Broadcast
Opens Dow 76.04
Dow 54.58

<CAPTION>
1930 1940 1950
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
The Great Social Security Unions Gain Pearl Harbor ENIAC The Baby The Korean Television Sputnik
Depression Created Strength Bombed Introduced Boom Begins War Dow 404.38 Dow 441.03
Dow 59.93 Dow 144.13 Dow 185.74 Dow 110.96 Dow 190.09 Dow 181.16 Dow 200.10

<CAPTION>
1960 1970 1980
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Cuban JFK Man Lands U.S. Leaves President Nixon Runaway Black Monday Fall of
Missile Assassinated on the Moon Vietnam Resigns Inflation Market Crash The Berlin
Crisis Dow 750.51 Dow 815.46 Dow 999.01 Dow 678.58 Dow 963.98 Dow 1993.50 Wall
Dow 589.77 Dow 2706.27
Oil Embargo
Dow 956.57

<CAPTION>
1990
- ------------------------------------------------------------------------------
Introduction of the Presidential Budget Surplus
World Wide Web Impeachment Dow 10,336.95
Dow 3754.09 Dow 9116.55
</TABLE>

<PAGE>

[graphic omitted]

DIVERSIFYING YOUR PORTFOLIO CAN HELP YOU MANAGE INVESTMENT RISK.

Building a diversified portfolio may provide the key to finding a balance
between risk and the pursuit of your investment goals.

Investment risk comes in many forms. The risk that most people think of is the
potential to lose money due to a decline in the value of an investment.
Understanding this type of risk - known as market risk - is critical to making
sound investment decisions.

Other types of risk, however, should also be considered when choosing
investments. Inflation risk is often overlooked by those who are investing for
current income or to preserve capital. But over time, inflation can eat away at
your purchasing power. If prices were to rise at an inflation rate of 4% per
year, after 20 years a dollar would buy only half as much as it does today.
Another more subtle form of risk involves the possibility of not meeting your
investment objectives. If you are investing to build a nest egg for retirement,
for example, the consequences of not meeting your goal could be significant.

Unfortunately, these different types of risk can make it difficult for people to
feel comfortable with their investment choices. For example, if you invest in
growth-oriented stock funds in order to have the best chance of outpacing
inflation, you will generally incur a higher degree of market risk, since stocks
tend to be more volatile than other types of investments.

[graphic omitted]

Building a diversified portfolio may provide the key to finding a balance
between risk and the pursuit of your investment goals.

- --------------------------------------------------------------------------------
ASSET ALLOCATION TAKES THE CONCEPT OF DIVERSIFICATION ONE STEP FURTHER.
- --------------------------------------------------------------------------------

WHY DIVERSIFICATION CAN HELP REDUCE RISK

Diversification helps put the law of averages to work for you. When you invest
in more than one stock or bond, your portfolio return is based on the average of
all the individual securities in the portfolio. But the variability of your
returns - a way to measure your chance of loss - will likely be less than the
average volatility of the individual securities. This means that by
diversifying, you can potentially reduce risk without having to sacrifice the
opportunity to earn higher returns.

Asset allocation takes the concept of diversification one step further. Because
prices of different types of assets, such as money market instruments, bonds,
and stocks, often don't react the same way to market events, they can provide
potentially greater diversification benefits than securities in the same asset
class. A measure that can help assess the potential risk-reduction afforded is
known as correlation. The lower the correlation between two securities, the
greater the diversification opportunities. In general, U.S. stocks tend to have
a correlation of around 0.70 with each other, while stocks and bonds have a
correlation of less than 0.40.*

- --------------------------------------------------------------------------------
CORRELATION IS THE DEGREE TO WHICH INVESTMENTS MOVE UP AND DOWN TOGETHER.
- --------------------------------------------------------------------------------

KEEP YOUR TIME FRAME IN MIND

The individual asset classes that you choose for your investment portfolio will
depend largely on your time frame. Whether you are pursuing a short-term goal or
have a longer-term investment horizon, it's always important to seek to
diversify your investments appropriately. For more information about how to
tailor your portfolio to fit your objectives, speak with your financial
representative.

Fixed-Income Investments Can Help
SMOOTH PORTFOLIO RETURNS

Although equity investments have dominated headlines in recent years,
fixed-income securities remain a viable investment alternative that can play an
important part in an overall investment portfolio. Bond investments are
generally less risky than stock investments and have a predictable income stream
that continues even if prices decline. With low inflation creating strong real
returns, the current market environment is quite positive for fixed-income
investments. The real return of an investment is the difference between the
overall return and the current rate of inflation; it measures the change in
wealth or buying power offered by an investment. Even with bond yields that are
less-than-historical averages, lower inflation can produce very attractive real
returns.

In addition to strong results, fixed-income investments offer diversification
and risk management characteristics as a part of an overall investment
portfolio. Bonds can reduce volatility in your portfolio if combined with stock
investments. Bond investments also offer a safer environment if you are closer
to reaching a long-term goal, such as a college fund or retirement portfolio.
Speak with your representative about your current portfolio and discuss
strategies to incorporate fixed-income investments.

STRONG REAL RETURNS FOR FIXED-INCOME INVESTMENTS VS. INFLATION
(January 1985 - October 1999)

HIGH-YIELD CORPORATE 11.36%
CORPORATE 9.95%
MORTGAGE 9.67%
GOVERNMENT 9.02%
INFLATION 3.22%

Source: Ibbotson Associates. Lehman Brothers indices used for Corporate,
Mortgage and Government Bonds; Ibbotson indices used for high-yield bonds and
inflation. Individuals cannot invest directly in an index.

- --------------------------------------------------------------------------------

CONSIDER INTERNATIONAL INVESTMENTS

Over the years, the correlation between domestic stocks and bonds has gradually
risen. Therefore, the potential diversification benefits afforded today, while
still quite substantial, may not be as significant as they were in the '40s,
'50s, and '60s.

Because the concept of diversification applies to many types of investments,
however, you can potentially further reduce the variability of your portfolio
returns by investing in additional asset classes.

If you are investing for a long-term goal, including international investments
in your asset allocation may potentially help temper declines in the values of
your domestic stock and bond investments over time. Prices of stocks and bonds
issued by companies or governments in foreign countries often do not move in
tandem with securities prices in the U.S. For example, the foreign stocks that
comprise the Morgan Stanley Capital International EAFE index have a correlation
of 0.53 with the S&P 500 index.**

Of course, risk is only part of the equation. The chart to the left shows annual
historical returns for international stock and bond indices since 1985. As in
the U.S. markets, stocks have generally posted higher returns than bonds over
time, but also carry a greater degree of risk.

* Source: Standard & Poor's. Stocks are represented by the S&P 500. Bonds are
represented by the returns of 30-year Government bonds. Based on monthly
returns for the 20-year period ended September 30, 1999.

** Source: Standard & Poor's. Based on monthly returns for the 20-year period
ended September 30, 1999. International investments can carry greater risks
including currency, liquidity and political risks.

PERFORMANCE OF INTERNATIONAL INVESTMENTS INDICES
(January 1985 - October 1999)

MSCI Nordic Countries 22.13%
MSCI Europe 19.40%
MSCI World 16.44%
MSCI EAFE 15.55%
SB Foreign Government Bonds 12.91%
MSCI Far East 11.33%
IFCG Emerging Markets 11.09%

Source: Ibbotson Associates. Regional equity indices provided by Morgan Stanley
Capital International (MSCI), bond index provided by Salomon Brothers, and
Emerging Markets index provided by the International Finance Corporation.
Individuals cannot invest directly in an index. International investments can
carry greaster risks including currency, liquidity and political risks.

<PAGE>

MONEY MARKET FUNDS

PORTFOLIO MANAGER: AUDREY QUAYE
WM ADVISORS, INC.

Audrey Quaye has seven years experience in investment management and analysis.
She is a Chartered Financial Analyst and a Certified Public Accountant. She also
holds an MBA from the University of Southern California, and has been with WM
Advisors, Inc. since 1996.

ECONOMIC OVERVIEW

Economic data released during the year indicated continuing strength in the U.S.
economy. Industrial production, which had been moderate at the beginning of the
period, accelerated during the past six months. Consumer confidence remained
relatively high and consumer spending continued unabated. Housing demand began
to slow down during the second half of the fiscal year, partially due to an
increase in mortgage rates. Also, oil prices rose from $10.76 a barrel on
December 10, 1998 to a high of $25.45 on September 23, 1999. Exports also began
to show a rising trend. The labor market remained tight in most regions, and the
unemployment rate declined to a 30-year low of 4.10% in October 1999.

Similar to the national economy, California's economy continued to expand during
the period. The non-durable goods, manufacturing, construction, trade, and
services sectors fueled the growth. The State's total non-farm employment grew
by 2.4% during the year, and the unemployment rate for September 1999 was 4.9%,
down from 5.9% in November 1998.

As a result of economic expansion, California's tax revenues have increased each
year since 1995. This allowed the state to erase the General Fund deficit that
it accumulated in prior years. However, the fiscal flexibility of the state and
its municipalities continues to be hampered by various ballot initiatives.
Nevertheless, we believe California's economic outlook appears stable.

In response to mounting concerns over inflationary pressures, the Federal
Reserve's Open Market Committee raised its target fed funds rate (the rate at
which banks borrow from each other) 25 basis points on June 30, 1999. On August
24, 1999, the Fed raised rates another 25 basis points to end the period at
5.25%. The benchmark 90-day U.S. Treasury bill yield rose from a low of 4.27% on
April 13, 1999, to a high of 5.13% on October 19, 1999. This trend benefited
money market shareholders since the average yield on taxable money market
instruments also rose significantly during the period. The spread (difference
between the yield on the 90-day Treasury Bill and the yield of money market
instruments) widened from a low of 34 basis points (0.34%) in March to a high of
139 basis points, on October 8, 1999. Thus, the yield advantage of money market
funds relative to T-Bills improved drastically. The yield spread widened due to
the combined effect of liquidity concerns related to Year 2000 and the effect of
normal year-end borrowing by corporations.

ECONOMIC AND INTEREST RATE OUTLOOK

The short-term interest rate outlook is uncertain due to continued tightness of
the U.S. labor market, mounting wage pressures, and a gradual improvement in
global economies, especially in Europe and Asia. We believe that short-term
interest rate increases are possible, but long-term conditions remain positive.
The rate hikes are likely to lead to a more moderate economic growth rate and
lower levels of inflation. However, the weakening of the U.S. dollar versus
other major currencies and the increasing valuation of the stock market remain
as concerns.

PORTFOLIO STRATEGY

WM MONEY MARKET FUND

The Money Market Fund's net assets totaled $584 million on October 31, 1999. We
increased the Fund's exposure to floating rate notes to take advantage of the
widening spread between the 90-day Treasury bill yield and corporate borrowing
rates. We also increased the Fund's exposure to domestic money market
instruments because of improved credit quality of domestic issuers. Finally, we
kept the Fund's weighted average maturity neutral relative to the benchmark in
view of the uncertainty regarding interest rates.

WM TAX-EXEMPT MONEY MARKET FUND

The Tax-Exempt Money Market Fund's net assets totaled $32 million at the fiscal
year end. We continued our strategy of maintaining the Fund's weighted average
maturity slightly long relative to the benchmark. This resulted in a decrease in
the volatility of the Fund's yield. We will continue to vary the Fund's exposure
to daily variable rate securities in response to seasonal interest rate
variations.

WM CALIFORNIA MONEY FUND

The California Money Fund's net assets totaled $34 million at the end of the
period. The supply of California tax-exempt money market instruments was thin
relative to prior years. The State's economy improved; therefore, municipalities
issued fewer notes than in prior years. We kept the Fund's weighted average
maturity neutral relative to its benchmark. We also varied the Fund's exposure
to daily variable rate securities in response to seasonal interest rate changes.

THE YEAR 2000 PROBLEM (Y2K)

Many computer systems in use today cannot process date-related information in
relation to year 2000. This issue originates in the practice of abbreviating
years to their last two digits. Computer systems may not be able to decide
correctly when a date entered with a year of "00" should be interpreted as 1900
or 2000. At the turn of the new century, computer systems may not function
properly because they may not be able to recognize or interpret the year 2000.

Should any of the computer systems employed by the WM Funds' or Portfolios'
major service providers fail to process this type of information properly, it
could have a negative impact on Fund or Portfolio operations and the services
that are provided to shareholders. Similarly, the values of certain of the WM
Funds' or Portfolios' assets may be adversely affected by the inability of their
issuers or third parties to properly process date-related information.

The Advisor, Shareholder Service Agent and Administrator have advised the Funds
and Portfolios that they have reviewed their critical computer systems and are
confident that the systems will process information correctly regardless of the
end of the century. The Funds and Portfolios have received similar assurances
from other key service providers. We recognize that no one can guarantee that
there will not be problems when the Year 2000 arrives, and have developed
contingency plans in case problems should occur.

<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------
FUND performance*
as of October 31, 1999

7-DAY 7-DAY
SIMPLE YIELD COMPOUNDED YIELD WEIGHTED AVERAGE
A SHARES B SHARES A SHARES B SHARES MATURITY (DAYS)

<S> <C> <C> <C> <C> <C>
WM MONEY MARKET FUND 4.83% 3.77% 4.95% 3.84% 57
- -----------------------------------------------------------------------------------------------------------------------
WM TAX-EXEMPT MONEY MARKET FUND 2.79% 1.97% 2.83% 2.16% 58
- -----------------------------------------------------------------------------------------------------------------------
WM CALIFORNIA MONEY FUND 2.39% 1.27% 2.42% 1.28% 58
- -----------------------------------------------------------------------------------------------------------------------

* During the period noted, WM Advisors, Inc. waived a portion of its management fees and reimbursed certain
other expenses. The Funds' yields would have been lower had the Advisor not waived a portion of its fees or
reimbursed certain other expenses, and the Fund's custodian had not allowed its fees to be reduced by
credits. All yield information represents past performance, which cannot guarantee future results. An
investment in the Funds is not insured or guaranteed by the Federal Deposit Insurance Corporation or any
other government agency. Although the Funds seek to preserve the value of your investment at $1.00 per
share, it is possible to lose money by investing in the Funds.
</TABLE>

<PAGE>

STATEMENTS of ASSETS and LIABILITIES

WM GROUP OF FUNDS
OCTOBER 31, 1999

TAX-EXEMPT
MONEY MONEY CALIFORNIA
MARKET MARKET MONEY
FUND FUND FUND
------------ ----------- -----------
ASSETS:
Investments, at value
(See portfolios of investments) (a) $591,604,984 $32,610,105 $34,636,347
Cash ................................. 302 -- --
Interest receivable .................. 2,670,733 297,656 268,424
Receivable for Fund shares sold ...... 2,051,335 80,569 162,794
Receivable for investment securities
sold ................................. -- -- 675,120
Prepaid expenses and other assets .... 4,127 265 464
------------ ----------- -----------
Total Assets ..................... 596,331,481 32,988,595 35,743,149
------------ ----------- -----------
LIABILITIES:
Payable for Fund shares redeemed ..... 2,058,455 27,404 415,194
Payable for investment securities
purchased ............................ 10,000,000 1,206,765 1,006,001
Investment advisory fee payable ...... 224,840 109 13,307
Shareholder servicing and distribution
fees payable ......................... 16,805 304 67
Dividends payable .................... 49,695 844 863
Due to custodian ..................... -- -- 482
Accrued expenses and other payables .. 325,871 46,711 38,374
------------ ----------- -----------
Total Liabilities ................ 12,675,666 1,282,137 1,474,288
------------ ----------- -----------
NET ASSETS ........................... $583,655,815 $31,706,458 $34,268,861
============ =========== ===========
- ----------------
(a) Investments, at cost ............. $591,604,984 $32,610,105 $34,636,347
============ =========== ===========

See Notes to Financial Statements.

<PAGE>

STATEMENTS of ASSETS and LIABILITIES (continued)

WM GROUP OF FUNDS
OCTOBER 31, 1999

TAX-EXEMPT
MONEY MONEY CALIFORNIA
MARKET MARKET MONEY
FUND FUND FUND
------------- ------------ -----------
NET ASSETS CONSIST OF:
Undistributed net investment
income .........................
$ 3,519 $ -- $ 3,771
Accumulated net realized loss on
investments sold ................. (73,807) (4,891) (40,976)
Paid-in capital .................. 583,726,103 31,711,349 34,306,066
------------ ----------- -----------
Total Net Assets ........... $583,655,815 $31,706,458 $34,268,861
============ =========== ===========
NET ASSETS:
Class A Shares ................... $460,443,816 $31,352,896 $34,215,796
============ =========== ===========
Class B Shares ................... $ 20,451,629 $ 353,562 $ 53,065
============ =========== ===========
Class I Shares ................... $102,760,370 -- --
============
SHARES OUTSTANDING:
Class A Shares ................... 460,486,529 31,352,873 34,257,434
============ =========== ===========
Class B Shares ................... 20,452,196 353,563 53,133
============ =========== ===========
Class I Shares ................... 102,771,577 -- --
============
CLASS A SHARES:
Net asset value per share of
beneficial interest outstanding* $1.00 $1.00 $1.00
============ =========== ===========
CLASS B SHARES:
Net asset value and offering price
per share of beneficial interest
outstanding* ................... $1.00 $1.00 $1.00
============ =========== ===========
CLASS I SHARES:
Net asset value, offering and
redemption price per share of
beneficial interest outstanding $1.00 -- --
============

- --------------
* Redemption price per share is equal to net asset value less any applicable
contingent deferred sales charge.

See Notes to Financial Statements.

<PAGE>

STATEMENTS of OPERATIONS

WM GROUP OF FUNDS
FOR THE YEAR ENDED OCTOBER 31, 1999

TAX-EXEMPT
MONEY MONEY CALIFORNIA
MARKET MARKET MONEY
FUND FUND FUND
------------ ------------ ----------
INVESTMENT INCOME:
Interest ........................... $29,911,536 $1,059,503 $1,097,186
----------- ----------- ----------
EXPENSES:
Investment advisory fee ............ 2,611,321 149,140 163,095
Custodian fees ..................... 16,785 3,605 4,192
Legal and audit fees ............... 64,181 20,099 18,217
Registration and filing fees ....... 138,226 38,363 13,851
Printing and postage fees .......... 637,515 43,426 44,015
Other .............................. 135,214 4,946 14,560
Shareholder servicing and distribution fees:
Class B Shares ................... 104,487 1,273 665
Class S Shares.................... 31,046 -- 8
Transfer agent fees:
Class A Shares ................... 511,104 34,781 35,660
Class B Shares ................... 16,405 117 144
Class S Shares ................... 14,335 -- 32
Fees waived by investment advisor .. -- (104,700) --
----------- ----------- ----------
Total expenses ............... 4,280,619 191,050 294,439
Fees reduced by credits allowed by
the custodian ...................... (14,772) (895) (900)
----------- ----------- ----------
Net expenses ................. 4,265,847 190,155 293,539
----------- ----------- ----------
NET INVESTMENT INCOME .............. 25,645,689 869,348 803,647
----------- ----------- ----------

NET REALIZED GAIN/(LOSS) FROM
INVESTMENT TRANSACTIONS 14,291 25 (2)
----------- ----------- ----------

NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS................... $25,659,980 $ 869,373 $ 803,645
=========== ========== ==========

See Notes to Financial Statements.

<PAGE>

STATEMENTS of CHANGES in NET assets

WM GROUP OF FUNDS
FOR THE YEAR ENDED OCTOBER 31, 1999

<TABLE>
<CAPTION>
TAX-EXEMPT
MONEY MONEY CALIFORNIA
MARKET MARKET MONEY
FUND FUND FUND
----------------- ---------------- ---------------
<S> <C> <C> <C>
Net investment income ...................... $ 25,645,689 $ 869,348 $ 803,647
Net realized gain/(loss) on investment
transactions ............................. 14,291 25 (2)
------------ ----------- -----------
Net increase in net assets resulting from
operations ................................. 25,659,980 869,373 803,645
Distributions to shareholders from net
investment income:
Class A Shares ........................... (21,285,571) (867,445) (802,809)
Class B Shares ........................... (349,900) (1,903) (710)
Class S Shares ........................... (106,011) -- (9)
Class I Shares ........................... (3,900,688) -- (19)
Net increase/(decrease) in net assets from
Fund share transactions:
Class A Shares ........................... 56,987,030 5,911,868 (2,951,415)
Class B Shares ........................... 13,832,418 141,454 (4,995)
Class S Shares ........................... (6,304,983) -- (1,182)
Class I Shares ........................... (5,963,302) -- (1,068)
------------ ----------- -----------
Net increase/(decrease) in net assets ...... 58,568,973 6,053,347 (2,958,562)

NET ASSETS:
Beginning of year .......................... 525,086,842 25,653,111 37,227,423
------------ ----------- -----------
End of year ................................ $583,655,815 $31,706,458 $34,268,861
============ =========== ===========

Undistributed net investment income at end
of year .................................. $ 3,519 $ -- $ 3,771
============ =========== ===========
</TABLE>
See Notes to Financial Statements.

<PAGE>

STATEMENTS of CHANGES in NET assets

WM GROUP OF FUNDS
FOR THE PERIODS ENDED OCTOBER 31, 1998

<TABLE>
<CAPTION>
TAX-EXEMPT
MONEY MONEY CALIFORNIA
MARKET MARKET MONEY
FUND(a) FUND(a) FUND(b)
----------------- ---------------- ---------------
<S> <C> <C> <C>
Net investment income ...................... $ 18,139,941 $ 720,598 $ 296,345
Net realized loss on investment transactions (72,297) (3) --
------------ ----------- -----------
Net increase in net assets resulting from
operations ................................. 18,067,644 720,595 296,345
Distributions to shareholders from net
investment income:
Class A Shares ........................... (14,948,299) (720,041) (296,197)
Class B Shares............................ (103,182) (557) (141)
Class S Shares ........................... (172,000) -- (3)
Class I Shares ........................... (2,916,460) -- (4)
Net increase/(decrease) in net assets from
Fund share transactions:
Class A Shares ........................... 142,622,001 (6,693,465) (235,693)
Class B Shares ........................... 6,149,166 200,309 (4,765)
Class S Shares ........................... 6,304,983 -- 6
Class I Shares ........................... 108,734,879 -- 8
------------ ----------- -----------
Net increase/(decrease) in net assets ...... 263,738,732 (6,493,159) (240,444)

NET ASSETS:
Beginning of period ........................ 261,348,110 32,146,270 37,467,867
------------ ----------- -----------
End of period .............................. $525,086,842 $25,653,111 $37,227,423
============ =========== ===========

Undistributed net investment income
(distributions in excess of net investment
income) at end of period ................. $ (3,587) $ -- $ 2,366
============ =========== ===========

- --------------
(a) Fiscal year end changed to October 31 from December 31. The amounts reflected are for the period
January 1, 1998 through October 31, 1998.
(b) Fiscal year end changed to October 31 from June 30. The amounts reflected are for the period July 1, 1998
through October 31, 1998.
</TABLE>

See Notes to Financial Statements.

<PAGE>
STATEMENTS of CHANGES in NET assets
WM GROUP OF FUNDS
FOR THE YEAR ENDED DECEMBER 31, 1997

<TABLE>
<CAPTION>
TAX-EXEMPT
MONEY MONEY
MARKET MARKET
FUND FUND
------------ -----------
<S> <C> <C>
Net investment income .................................... $ 12,584,944 $ 1,009,403
------------ -----------
Net increase in net assets resulting from operations ..... 12,584,944 1,009,403
Distributions to shareholders from net investment income:
Class A Shares ......................................... (12,575,604) (1,009,190)
Class B Shares.......................................... (9,340) (213)
Net increase in net assets from Fund share transactions:
Class A Shares ......................................... 31,522,179 160,533
Class B Shares ......................................... 353,674 9,595
------------ -----------
Net increase in net assets ............................... 31,875,853 170,128

NET ASSETS:
Beginning of year ........................................ 229,472,257 31,976,142
------------ -----------
End of year .............................................. $261,348,110 $32,146,270
============ ===========
</TABLE>

See Notes to Financial Statements.

<PAGE>

STATEMENT of CHANGES in NET assets

WM GROUP OF FUNDS
FOR THE YEAR ENDED JUNE 30, 1998

CALIFORNIA
MONEY
FUND
-----------
Net investment income ................................... $ 1,094,589
-----------
Net increase in net assets resulting
from operations ....................................... 1,094,589
Distributions to shareholders from net
investment income:
Class A Shares ........................................ (1,093,207)
Class B Shares......................................... (1,326)
Class S Shares......................................... (22)
Class I Shares ........................................ (31)
Net increase/(decrease) in net assets from Fund
share transactions:
Class A Shares ........................................ (5,520,424)
Class B Shares ........................................ (4,780)
Class S Shares ........................................ 22
Class I Shares ........................................ 31
-----------
Net decrease in net assets .............................. (5,525,148)

NET ASSETS:
Beginning of year ....................................... 42,993,015
-----------
End of year ............................................. $37,467,867
===========

Undistributed net investment income at end of year ...... $ 2,366
===========

See Notes to Financial Statements.

<PAGE>

STATEMENTS of CHANGES in NET assets -- CAPITAL stock ACTIVITY
WM GROUP OF FUNDS

Since the Funds have sold, issued as reinvestment of dividends and redeemed
shares only at a constant net asset value of $1.00 per share, the number of
shares represented by such sales, reinvestments and redemptions is the same as
the amounts shown below for such transactions.

<TABLE>
<CAPTION>
MONEY MARKET FUND TAX-EXEMPT MONEY MARKET FUND
------------------------------------------------------- -----------------------------------------------
YEAR ENDED PERIOD ENDED YEAR ENDED YEAR ENDED PERIOD ENDED YEAR ENDED
10/31/99 10/31/98(a) 12/31/97 10/31/99 10/31/98(a) 12/31/97
---------- ------------ ---------- ---------- ------------ ----------
<S> <C> <C> <C> <C> <C> <C>
CLASS A:
Sold ................. $ 849,142,559 $ 1,029,291,671 $ 631,834,628 $ 43,233,412 $ 30,837,963 $ 55,194,481
Issued in exchange for
Class A shares of
the Sierra Global
Money Fund.......... -- 86,308,379 -- -- -- --
Issued in exchange for
Class A shares of
the Sierra U.S.
Government Money
Fund ............... -- 21,242,345 -- -- -- --
Issued in exchange for
Class A shares of
the Griffin Money
Market Fund . 227,709,262 -- -- -- -- --
Issued in exchange for
Class A shares of
the Griffin Tax-Free
Money Market Fund .. -- -- -- 21,062,829 -- --
Issued as reinvestment
of dividends........ 20,521,935 13,666,591 12,427,917 838,120 710,706 1,003,218
Redemption in-kind
(Note 10) .............. (31,927,854) -- -- -- -- --
Redeemed ............. (1,008,458,872) (1,007,886,985) (612,740,366) (59,222,493) (38,242,134) (56,037,166)
-------------- ---------------- -------------- ------------- ------------- -------------
Net increase/
(decrease) .......... $ 56,987,030 $ 142,622,001 $ 31,522,179 $ 5,911,868 $ (6,693,465) $ 160,533
============== ================ ============== ============= ============= =============
CLASS B:
Sold ................. $ 28,425,937 $ 15,707,869 $ 916,714 $ 534,633 $ 201,001 $ 12,980
Converted from Class S
shares of Fund ..... 3,673,738 -- -- -- -- --
Issued in exchange for
Class B shares of
the Sierra Global
Money Fund.......... -- 1,089,407 -- -- -- --
Issued in exchange for
Class B shares of
the Sierra U.S.
Government Money
Fund ............... -- 915,101 -- -- -- --
Issued as reinvestment
of dividends........ 330,884 91,008 9,036 1,641 552 188
Redeemed ............. (18,598,141) (11,654,219) (572,076) (394,820) (1,244) (3,573)
-------------- ---------------- -------------- ------------- ------------- -------------
Net increase ......... $ 13,832,418 $ 6,149,166 $ 353,674 $ 141,454 $ 200,309 $ 9,595
============== ================ ============== ============= ============= =============
CLASS S:
Sold ................. $ 322,752 $ 1,846,781 -- -- -- --
Issued in exchange for
Class S shares of
the Sierra Global
Money Fund.......... -- 6,970,804 -- -- -- --
Issued in exchange for
Class S shares of
the Sierra U.S.
Government Money
Fund ............... -- 499,760 -- -- -- --
Issued as reinvestment
of dividends........ 97,701 166,689 -- -- -- --
Converted to Class B
shares of Fund (3,673,738) -- -- -- -- --
Redeemed ............. (3,051,698) (3,179,051) -- -- -- --
-------------- ----------------
Net increase/
(decrease) ............. $ (6,304,983) $ 6,304,983 -- -- -- --
============== ================
CLASS I:
Sold ................. $ 71,638,115 $ 37,068,793 -- -- -- --
Contribution in-kind
(Note 10) .......... 31,927,854 -- -- -- -- --
Issued in exchange for
Class I shares of
the Sierra Global
Money Fund.......... -- 76,706,647 -- -- -- --
Issued in exchange for
Class I shares of
the Sierra U.S.
Government Money
Fund ............... -- 13,331,744 -- -- -- --
Issued as reinvestment
of dividends........ 3,634,675 356,277 -- -- -- --
Redeemed ............. (113,163,946) (18,728,582) -- -- -- --
-------------- ----------------
Net increase/
(decrease) ............. $ (5,963,302) $ 108,734,879 -- -- -- --
============== ================

- --------------
(a) Fiscal year end changed to October 31 from December 31. The amounts reflected are for the period January 1, 1998 through
October 31, 1998.
</TABLE>

See Notes to Financial Statements.

<PAGE>

STATEMENTS of CHANGES in NET assets -- CAPITAL stock ACTIVITY
WM GROUP OF FUNDS

<TABLE>
<CAPTION>
CALIFORNIA MONEY FUND
------------------------------------------------------
YEAR ENDED PERIOD ENDED YEAR ENDED
10/31/99 10/31/98(a) 06/30/98
---------- ------------ ----------
<S> <C> <C> <C>
CLASS A:
Sold ..................................... $ 33,348,665 $ 10,436,305 $ 30,331,723
Issued as reinvestment of dividends ...... 773,933 286,201 1,056,492
Redeemed ................................. (37,074,013) (10,958,199) (36,908,639)
------------- ------------ -------------
Net decrease ............................. $ (2,951,415) $ (235,693) $ (5,520,424)
============= ============ =============
CLASS B:
Sold ..................................... $ 32,072 $ -- $ 70,100
Issued as reinvestment of dividends ...... 685 301 1,322
Redeemed ................................. (37,752) (5,066) (76,202)
------------- ------------ -------------
Net decrease ............................. $ (4,995) $ (4,765) $ (4,780)
============= ============ =============
CLASS S:
Sold ..................................... $ -- $ -- $ --
Issued as reinvestment of dividends ...... 9 6 22
Redeemed ................................. (1,191) -- --
------------- ------------ -------------
Net increase/(decrease) .................. $ (1,182) $ 6 $ 22
============= ============ =============
CLASS I:
Sold ..................................... $ -- $ -- $ --
Issued as reinvestment of dividends ...... 18 8 31
Redeemed ................................. (1,086) -- --
------------- ------------ -------------
Net increase/(decrease) .................. $ (1,068) $ 8 $ 31
============= ============ =============

- --------------
(a) Fiscal year end changed to October 31 from June 30. The amounts reflected are for the period
July 1, 1998 through October 31, 1998.

See Notes to Financial Statements.
</TABLE>

<PAGE>

[THIS PAGE INTENTIONALLY LEFT BLANK]

<PAGE>

FINANCIAL highlights

MONEY MARKET FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD.

<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
------------------------------------ -------------------------------------
NET DIVIDENDS
ASSET VALUE, NET TOTAL FROM FROM NET
BEGINNING INVESTMENT INVESTMENT INVESTMENT TOTAL
OF PERIOD INCOME OPERATIONS INCOME DISTRIBUTIONS
-------------- --------------- --------------- ---------------- ---------------
<S> <C> <C> <C> <C> <C>
CLASS A
10/31/99 $1.00 $0.044 $0.044 $(0.044) $(0.044)
10/31/98(a) 1.00 0.041 0.041 (0.041) (0.041)
12/31/97 1.00 0.049 0.049 (0.049) (0.049)
12/31/96 1.00 0.048 0.048 (0.048) (0.048)
12/31/95 1.00 0.052 0.052 (0.052) (0.052)
12/31/94 1.00 0.034 0.034 (0.034) (0.034)

CLASS B
10/31/99 1.00 0.034 0.034 (0.034) (0.034)
10/31/98(a) 1.00 0.035 0.035 (0.035) (0.035)
12/31/97 1.00 0.041 0.041 (0.041) (0.041)
12/31/96 1.00 0.038 0.038 (0.038) (0.038)
12/31/95 1.00 0.042 0.042 (0.042) (0.042)
12/31/94(c) 1.00 0.018 0.018 (0.018) (0.018)

CLASS I
10/31/99 1.00 0.046 0.046 (0.046) (0.046)
10/31/98(c) 1.00 0.031 0.031 (0.031) (0.031)

<CAPTION>
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
-----------------------------------------------------------------------
RATIO OF OPERATING
EXPENSES TO AVERAGE
NET ASSETS WITHOUT
FEE WAIVERS
RATIO OF RATIO OF AND/OR FEES
OPERATING NET INVESTMENT REDUCED BY
NET NET ASSETS, EXPENSES TO INCOME TO CREDITS ALLOWED
ASSET VALUE, TOTAL END OF PERIOD AVERAGE NET AVERAGE NET BY THE
END OF PERIOD RETURN+ (IN 000'S) ASSETS(b) ASSETS CUSTODIAN
----------- --------- ------------ ----------- ----------- -------------------
<S> <C> <C> <C> <C> <C> <C>
CLASS A
10/31/99 $1.00 4.52% $460,444 0.72% 4.43% 0.73%
10/31/98(a) 1.00 4.19% 403,443 0.66%* 4.94%* 0.67%*
12/31/97 1.00 5.04% 260,877 0.75% 4.93% 0.83%
12/31/96 1.00 4.88% 229,355 0.79% 4.77% 0.89%
12/31/95 1.00 5.33% 171,225 0.92% 5.19% 1.04%
12/31/94 1.00 3.47% 125,651 0.95% 3.39% 1.04%

CLASS B
10/31/99 1.00 3.44% 20,452 1.77% 3.38% 1.78%
10/31/98(a) 1.00 3.52% 6,619 1.64%* 3.96%* 1.65%*
12/31/97 1.00 4.15% 471 1.59% 4.15% 1.80%
12/31/96 1.00 3.91% 117 1.69% 3.87% 1.90%
12/31/95 1.00 4.30% 74 1.94% 4.19% 2.10%
12/31/94(c) 1.00 2.78% 11 1.93%* 3.29%* 2.62%*

CLASS I
10/31/99 1.00 4.66% 102,760 0.62% 4.53% 0.63%
10/31/98(c) 1.00 3.17% 108,720 0.54%* 5.06%* 0.55%*

* Annualized.
+ Total return is not annualized for periods less than one year. Total returns would have been lower if certain fees had not been
waived by the investment advisor or if fees had not been reduced by credits allowed by the custodian.
(a) Fiscal year end changed to October 31 from December 31.
(b) Ratio of operating expenses to average net assets includes expenses paid indirectly beginning in fiscal year 1995.
(c) On May 2, 1994 and March 23, 1998 the Fund commenced selling Class B and Class I shares, respectively.
</TABLE>

See Notes to Financial Statements.

<PAGE>

FINANCIAL highlights

TAX-EXEMPT MONEY MARKET FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD.

<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
---------------------------------------- ----------------------------------------------
NET REALIZED
NET AND DIVIDENDS DISTRIBUTIONS
ASSET VALUE, NET UNREALIZED TOTAL FROM FROM NET FROM
BEGINNING INVESTMENT GAIN ON INVESTMENT INVESTMENT NET REALIZED TOTAL
OF PERIOD INCOME INVESTMENTS OPERATIONS INCOME GAINS DISTRIBUTIONS
----------- ---------- ---------- ---------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
CLASS A
10/31/99 $1.00 $0.026 $ -- $0.026 $(0.026) $ -- $(0.026)
10/31/98(a) 1.00 0.026 -- 0.026 (0.026) -- (0.026)
12/31/97 1.00 0.031 -- 0.031 (0.031) -- (0.031)
12/31/96 1.00 0.030 -- 0.030 (0.030) -- (0.030)
12/31/95 1.00 0.034 0.000# 0.034 (0.034) (0.000)# (0.034)
12/31/94 1.00 0.024 -- 0.024 (0.024) -- (0.024)

CLASS B
10/31/99 1.00 0.016 -- 0.016 (0.016) -- (0.016)
10/31/98(a) 1.00 0.018 -- 0.018 (0.018) -- (0.018)
12/31/97 1.00 0.022 -- 0.022 (0.022) -- (0.022)
12/31/96 1.00 0.020 -- 0.020 (0.020) -- (0.020)
12/31/95 1.00 0.023 0.000# 0.023 (0.023) (0.000)# (0.023)
12/31/94(c) 1.00 0.010 -- 0.010 (0.010) -- (0.010)

<CAPTION>
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
-----------------------------------------------------------------------
RATIO OF OPERATING
EXPENSES TO AVERAGE
NET ASSETS WITHOUT
FEE WAIVERS
RATIO OF RATIO OF AND/OR FEES
OPERATING NET INVESTMENT REDUCED BY
NET NET ASSETS, EXPENSES TO INCOME TO CREDITS ALLOWED
ASSET VALUE, TOTAL END OF PERIOD AVERAGE NET AVERAGE NET BY THE
END OF PERIOD RETURN+ (IN 000'S) ASSETS(b) ASSETS CUSTODIAN
----------- --------- ------------ ----------- ----------- -------------------
<S> <C> <C> <C> <C> <C> <C>
CLASS A $1.00 2.65% $ 31,353 0.57% 2.63% 0.89%
10/31/99 1.00 2.60% 25,441 0.55%* 3.09%* 0.72%*
10/31/98(a) 1.00 3.18% 32,134 0.57% 3.14% 0.71%
12/31/97 1.00 3.05% 31,974 0.57% 3.01% 0.72%
12/31/96 1.00 4.01% 30,988 0.61% 3.39% 0.81%
12/31/95 1.00 2.37% 33,612 0.60% 2.33% 0.76%
12/31/94
1.00 1.57% 354 1.56% 1.64% 1.88%
CLASS B 1.00 1.79% 212 1.63%* 2.01%* 1.80%*
10/31/99 1.00 2.26% 12 1.50% 2.32% 2.27%
10/31/98(a) 1.00 2.01% 2 1.53% 1.99% 4.22%
12/31/97 1.00 2.83% 1 1.73% 2.12% 3.66%
12/31/96 1.00 1.45% 1 1.66%* 1.38%* 3.61%*
12/31/95
12/31/94(c)
----------------

* Annualized.
# Amount represents less than $0.001 per share.
+ Total return is not annualized for periods less than one year. Total returns would have been lower if certain fees had not been
waived by the investment advisor or if fees had not been reduced by credits allowed by the custodian.
(a) Fiscal year end changed to October 31 from December 31.
(b) Ratio of operating expenses to average net assets includes expenses paid indirectly beginning in fiscal year 1995.
(c) On May 2, 1994 the Fund commenced selling Class B shares.
</TABLE>

See Notes to Financial Statements.

<PAGE>
FINANCIAL highlights

CALIFORNIA MONEY FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD.

<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
-------------------------------- ----------------------------------
NET DIVIDENDS
ASSET VALUE, NET TOTAL FROM FROM NET
BEGINNING INVESTMENT INVESTMENT INVESTMENT TOTAL
OF PERIOD INCOME OPERATIONS INCOME DISTRIBUTIONS
------------- ------------- ------------- -------------- --------------
<S> <C> <C> <C> <C> <C>
CLASS A
10/31/99 $1.00 $0.022 $0.022 $(0.022) $(0.022)
10/31/98(a) 1.00 0.008 0.008 (0.008) (0.008)
06/30/98 1.00 0.027 0.027 (0.027) (0.027)
06/30/97 1.00 0.028 0.028 (0.028) (0.028)
06/30/96 1.00 0.029 0.029 (0.029) (0.029)
06/30/95 1.00 0.028 0.028 (0.028) (0.028)

CLASS B
10/31/99 1.00 0.011 0.011 (0.011) (0.011)
10/31/98(a) 1.00 0.005 0.005 (0.005) (0.005)
06/30/98 1.00 0.019 0.019 (0.019) (0.019)
06/30/97 1.00 0.020 0.020 (0.020) (0.020)
06/30/96 1.00 0.022 0.022 (0.022) (0.022)
06/30/95(c) 1.00 0.020 0.020 (0.020) (0.020)

<CAPTION>
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
-----------------------------------------------------------------------
RATIO OF OPERATING
EXPENSES TO AVERAGE
NET ASSETS WITHOUT
FEE WAIVERS
RATIO OF RATIO OF AND/OR FEES
OPERATING NET INVESTMENT REDUCED BY
NET NET ASSETS, EXPENSES TO INCOME TO CREDITS ALLOWED
ASSET VALUE, TOTAL END OF PERIOD AVERAGE NET AVERAGE NET BY THE
END OF PERIOD RETURN+ (IN 000'S) ASSETS(b) ASSETS CUSTODIAN
----------- --------- ------------ ----------- ----------- -------------------
<S> <C> <C> <C> <C> <C> <C>
CLASS A
10/31/99 $1.00 2.24% $ 34,216 0.81% 2.22% 0.81%
10/31/98(a) 1.00 0.99% 37,167 0.73%* 2.31%* 0.87%*
06/30/98 1.00 2.73% 37,403 0.82% 2.71% 0.99%
06/30/97 1.00 2.81% 42,923 0.85% 2.75% 1.14%
06/30/96 1.00 3.00% 51,211 0.85% 2.94% 1.14%
06/30/95 1.00 2.79% 48,836 0.85% 2.73% 1.15%

CLASS B
10/31/99 1.00 1.15% 53 1.93% 1.10% 1.93%
10/31/98(a) 1.00 0.63% 58 1.60%* 1.44%* 2.05%*
06/30/98 1.00 1.96% 63 1.60% 1.88% 1.82%
06/30/97 1.00 2.03% 68 1.60% 2.00% 1.89%
06/30/96 1.00 2.22% 147 1.60% 2.19% 1.89%
06/30/95(c) 1.00 2.04% 79 1.60% 1.98% 1.90%
- ----------------
* Annualized.
+ Total return is not annualized for periods less than one year. Total returns would have been lower if certain fees had not been
waived by the investment advisor or if fees had not been reduced by credits allowed by the custodian.
(a) Fiscal year end changed to October 31 from June 30.
(b) Ratio of operating expenses to average net assets includes expenses paid indirectly beginning in fiscal year 1995.
(c) On July 1, 1994 the Fund commenced selling Class B shares.
</TABLE>

See Notes to Financial Statements.
<PAGE>

PORTFOLIO of INVESTMENTS

<TABLE>
<CAPTION>
MONEY MARKET FUND
OCTOBER 31, 1999

PRINCIPAL
AMOUNT VALUE
------ -----
<C> <S> <C>
COMMERCIAL PAPER (DOMESTIC) - 28.7%
American Express Credit Corporation:
$10,000,000 5.280% due 12/13/1999+++ .............................. $ 9,938,400
10,000,000 5.290% due 12/16/1999+++ .............................. 9,933,875
10,000,000 Associates First Capital Corporation,
5.300% due 12/17/1999+++ .............................. 9,932,278
10,000,000 AT&T Corporation,
5.300% due 12/09/1999+++ .............................. 9,944,056
10,000,000 Chase Manhattan Corporation,
5.310% due 12/15/1999+++ .............................. 9,935,100
10,000,000 Columbia University,
5.320% due 12/10/1999+++ .............................. 9,942,367
10,000,000 Ford Motor Credit Company,
5.940% due 01/18/2000+++ .............................. 9,871,300
10,000,000 Household Finance Corporation,
5.290% due 11/16/1999+++ .............................. 9,977,958
Merrill Lynch & Company Inc.:
10,000,000 5.290% due 11/19/1999+++ .............................. 9,973,550
10,000,000 5.960% due 01/31/2000+++ .............................. 9,849,344
10,000,000 Morgan Stanley Dean Witter Discover,
6.020% due 02/04/2000+++ .............................. 9,841,139
9,400,000 National Rural Utilities Cooperative Finance Corporation,
5.320% due 11/15/1999+++ .............................. 9,380,552
Private Export Funding Corporation:
10,000,000 5.280% due 11/17/1999+++ .............................. 9,976,533
4,000,000 5.850% due 02/25/2000+++ .............................. 3,924,600
5,000,000 5.880% due 02/28/2000+++ .............................. 4,902,817
Windmill Funding Corporation:
10,000,000 5.370% due 11/15/1999+++,# ............................ 9,979,117
10,000,000 5.380% due 11/22/1999+++,# ............................ 9,968,617
10,000,000 Xerox Credit Corporation,
5.280% due 12/10/1999+++ .............................. 9,942,800
----------------
Total Commercial Paper
(Cost $167,214,403) ................................... 167,214,403
----------------
COMMERCIAL PAPER (YANKEE) - 15.3%
Abbey National North America Corporation:
10,000,000 5.350% due 12/15/1999+++ .............................. 9,934,611
10,000,000 5.270% due 12/22/1999+++ .............................. 9,925,342
10,000,000 ANZ (Delaware) Inc.,
5.330% due 12/21/1999+++ .............................. 9,925,972
10,000,000 Bank of Nova Scotia,
5.950% due 01/31/2000+++ .............................. 9,849,597
10,000,000 Barclays U.S. Funding Corporation,
5.260% due 11/24/1999+++ .............................. 9,966,394
10,000,000 Bayerische Landesbank Girozentrale,
5.950% due 01/26/2000+++ .............................. 9,857,861
10,000,000 Toyota Motor Credit Corporation,
5.270% due 11/24/1999+++ .............................. 9,966,331
$10,000,000 UBS Finance Inc.,
5.330% due 12/16/1999+++ .............................. 9,933,375
10,000,000 Xerox Capital (Europe) Plc,
5.950% due 01/25/2000+++ .............................. 9,859,514
----------------
Total Commercial Paper (Yankee)
(Cost $89,218,997) .................................... 89,218,997
----------------
CERTIFICATE OF DEPOSIT (YANKEE) - 1.7%
(Cost $9,995,000)
10,000,000 Bayerische Landesbank, New York,
5.299% due 04/10/2000++ ............................... 9,995,000
----------------
CORPORATE BONDS AND NOTES - 13.2%
10,000,000 American Honda Finance Corporation, Note,
5.340% due 08/07/2000++,# ............................. 9,997,000
5,000,000 Citicorp, Euro Note,
5.713% due 12/09/1999++ ............................... 5,001,380
3,500,000 DBSI First Mortgage 1998, Note,
5.460% due 07/01/2023++ ............................... 3,500,000
Everett Clinic, P.S., Note:
5,600,000 5.460% due 12/01/2018++ ............................... 5,600,000
3,900,000 5.460% due 12/01/2021++ ............................... 3,900,000
10,000,000 First Union National Bank, Note,
5.605% due 09/25/2000++ ............................... 10,000,000
10,000,000 Goldman Sachs Group, Note,
6.299% due 07/14/2000++ ............................... 10,009,328
10,000,000 Illinois Power Company, First Mortgage,
5.625% due 04/15/2000 ................................. 9,987,778
8,000,000 National City Bank, Note,
6.286% due 10/16/2000++ ............................... 8,003,685
5,000,000 NationsBank N.A., Note,
5.515% due 02/04/2000++ ............................... 5,000,000
5,855,000 Presbyterian Homes & Services of New Jersey Obligated
Group, Revenue Bonds, 1998 Series B1, (Taxable),
5.460% due 12/01/2028++ ............................... 5,855,000
----------------
Total Corporate Bonds and Notes
(Cost $76,854,171) .................................... 76,854,171
----------------
MEDIUM TERM NOTES - 17.1%
Bear Stearns Companies Inc., Series B:
5,000,000 5.530% due 01/28/2000++ ............................... 5,000,000
10,000,000 5.344% due 05/05/2000++ ............................... 10,000,000
10,000,000 5.508% due 07/18/2000++ ............................... 9,996,346
5,000,000 Caterpillar Financial Services Corporation,
5.453% due 11/16/1999++ ............................... 4,999,418
4,810,000 Citicorp, Series C, Senior Note,
5.493% due 02/15/2000++ ............................... 4,809,539
General Electric Capital Corporation:
7,000,000 5.760% due 04/24/2000 ................................. 7,020,901
5,000,000 8.660% due 08/08/2000 ................................. 5,095,561
8,000,000 General Motors Acceptance Corporation,
5.470% due 02/03/2000++ ............................... 7,995,600
10,000,000 Household Finance Corporation,
5.650% due 09/14/2000++ ............................... 9,994,787
5,000,000 Merrill Lynch & Company Inc.,
6.256% due 04/17/2000++ ............................... 5,003,163
10,000,000 Morgan Stanley Dean Witter Discover,
6.134% due 04/03/2000++ ............................... 9,997,691
5,000,000 National Rural Utilities Cooperative Finance Corporation,
6.040% due 11/18/1999 ................................. 5,002,349
10,000,000 Wells Fargo Company,
5.225% due 04/10/2000 ................................. 9,998,200
5,000,000 Xerox Credit Corporation,
5.320% due 03/31/2000 ................................. 4,984,815
----------------
Total Medium Term Notes
(Cost $99,898,370) .................................... 99,898,370
----------------

MUNICIPAL BONDS - 7.4%
9,900,000 California Housing Finance Agency Revenue, Home Mortgage,
Series M, Taxable Bonds,
5.410% due 08/01/2019+ ................................ 9,900,000
5,000,000 Cleveland, Ohio, Airport Systems Revenue, Series E,
Taxable Bonds,
5.400% due 01/01/2020+ ................................ 5,000,000
9,920,000 Santa Rosa, California, Wastewater Revenue, Series A,
Taxable Bonds,
5.500% due 09/01/2028+ ................................ 9,920,000
12,475,000 South Fulton, Georgia, Municipal Regional Jail Authority,
Taxable Revenue Bonds, (Union City Justice Center
Project), Series 1999,
5.410% due 11/01/2017+ ................................ 12,475,000
Washington State Housing Finance Community, Multi-family
Revenue, Series B, Taxable Bonds:
2,480,000 (Boardwalk Apartments),
5.450% due 09/01/2028+ ................................ 2,480,000
2,100,000 (Cedar Landing),
5.450% due 12/01/2028+ ................................ 2,100,000
1,400,000 (Oxford Square),
5.450% due 12/01/2028+ ................................ 1,400,000
----------------
Total Municipal Bonds (Cost $43,275,000) ................ 43,275,000
----------------

U.S. GOVERNMENT AGENCY OBLIGATIONS - 15.2%
FEDERAL FARM CREDIT BANK (FFCB) - 6.0%
10,000,000 4.770% due 11/01/1999 ................................... 10,000,000
10,000,000 5.300% due 02/01/2000 ................................... 10,000,000
10,000,000 5.625% due 02/01/2000 ................................... 10,000,000
5,000,000 5.020% due 03/01/2000 ................................... 4,999,669
----------------
Total FFCBs (Cost $34,999,669) .......................... 34,999,669
----------------

FEDERAL HOME LOAN BANK (FHLB) - 7.5%
10,000,000 5.310% due 11/10/1999 ................................... 9,999,927
3,600,000 5.820% due 12/02/1999 ................................... 3,601,008
5,000,000 5.000% due 02/24/2000 ................................... 4,999,772
5,000,000 5.160% due 03/08/2000 ................................... 5,000,087
10,000,000 5.050% due 04/26/2000 ................................... 9,998,602
10,000,000 5.950% due 08/24/2000 ................................... 10,000,000
----------------
Total FHLBs (Cost $43,599,396) .......................... 43,599,396
----------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA) - 1.7%
(Cost $10,007,978)
10,000,000 8.350% due 11/10/1999 ................................... 10,007,978
----------------
Total U.S. Government Agency Obligations
(Cost $88,607,043) .................................... 88,607,043
----------------
REPURCHASE AGREEMENT - 2.8%
(Cost $16,542,000)
16,542,000 Agreement with Goldman Sachs & Company, 5.100%
dated 10/29/1999, to be repurchased at $16,549,030 on
11/01/1999, collaterialized by $16,872,840 U.S.
Treasury Note, 6.500% due 11/15/2026
(Market Value $16,963,607) ............................ 16,542,000
----------------
TOTAL INVESTMENTS (COST $591,604,984*) 101.4% 591,604,984
OTHER ASSETS AND LIABILITIES (NET) .................................. (1.4) (7,949,169)
---- ----------------
NET ASSETS .......................................................... 100.0% $ 583,655,815
===== ================
- --------------
* Aggregate cost for federal tax purposes.
+ Variable rate securities payable upon not more than seven calendar days' notice. The interest
rate shown reflects the rate currently in effect.
++ Floating rate security whose interest rate is reset periodically based on an index.
+++ Rate represents discount rate at the date of purchase (unaudited).
# Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities
may be resold in transactions exempt from registration, normally to qualified institutional buyers.
</TABLE>
See Notes to Financial Statements.
<PAGE>

PORTFOLIO of INVESTMENTS

TAX-EXEMPT MONEY MARKET FUND
OCTOBER 31, 1999

<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
------ -----
<C> <S> <C>
STATE AND MUNICIPAL SECURITIES - 102.6%

ALABAMA - 0.9%
$ 300,000 Mobile, Limited Tax General Obligation Warants,
4.050% due 02/15/2000 ................................... $ 300,465
---------------
ALASKA - 4.4%
700,000 Anchorage, Water Revenue Bonds,
4.500% due 09/01/2000 ................................... 703,829
700,000 Matanuska-Susitna Boro, Unlimited Tax General Obligation
Bonds, Series A,
4.000% due 03/01/2000 ................................... 700,911
---------------
1,404,740
---------------
FLORIDA - 3.5%
600,000 Dade County, Aviation Revenue Bonds, Series A,
3.350% due 10/01/2009+ .................................. 600,000
500,000 Florida, Housing Finance Agency, MFHR, (Oaks), Series A,
3.350% due 07/01/2007+ .................................. 500,000
---------------
1,100,000
---------------
ILLINOIS - 9.3%
200,000 Chicago, School Finance Authority, Unlimited Tax General
Obligation Bonds, Series A,
4.700% due 06/01/2000 ................................... 200,906
1,200,000 Chicago O'Hare International Airport General Airport Second
Lein Revenue Bonds, 1984 Series A,
3.500% due 01/01/2015+ .................................. 1,200,000
Illinois Development Finance Authority Revenue, (Uhlich
Children's Home Project):
700,000 3.500% due 04/01/2007+ .................................. 700,000
455,000 3.500% due 06/01/2015+ .................................. 455,000
400,000 Illinois Health Facilities Authority, Revenue Bonds,
(Swedish Covenant Hospital Project),
3.550% due 08/01/2025+ .................................. 400,000
---------------
2,955,906
---------------
INDIANA - 1.6%
500,000 Indiana Health Facilities Financing Authority Revenue,
(Deaconess Hospital Inc.),
3.500% due 01/01/2022+ .................................. 500,000
---------------
KANSAS - 1.0%
300,000 Shawnee, Industrial Revenue Bonds, (Shawnee Village
Associates LP),
3.550% due 12/01/2009+ .................................. 300,000
---------------
LOUISIANA - 6.0%
900,000 Ascension Parish, Pollution Control Revenue, (Borden Inc.
Project),
3.500% due 12/01/2009+ .................................. 900,000
1,000,000 Louisiana Public Facilities Authority Revenue Bonds, Multi-
family Mortgage Revenue Bonds, (Emberwood),
3.450% due 10/01/2022+ .................................. 1,000,000
---------------
1,900,000
---------------
MASSACHUSETTS - 1.2%
375,000 Dracut, Limited Tax General Obligation Bonds,
5.300% due 11/01/1999 ................................... 375,000
---------------
MICHIGAN - 10.7%
500,000 Anchor Bay, School District, School Building & Site,
Unlimited Tax General Obligation Bonds, Series I,
3.850% due 05/01/2000 ................................... 500,000
500,000 Michigan State Hospital Finance Authority Revenue,
(Hospital Equipment Loan Program), Series A,
3.520% due 12/01/2023+ .................................. 500,000
1,000,000 Michigan State Housing Development Authority, Limited
Obligation Revenue Bonds, (Laurel Valley),
3.500% due 12/01/2007+ .................................. 1,000,000
Michigan State Job Development Authority Revenue:
300,000 (East Lansing Residence),
3.750% due 12/01/2014+ .................................. 300,000
200,000 (Kentwood Residence),
3.750% due 11/01/2014+ .................................. 200,000
620,000 Okemos, Public School District, Unlimited Tax General
Obligation Bonds,
3.600% due 05/01/2000 ................................... 620,000
280,000 Tawas, Area Schools, Unlimited Tax General Obligation
Bonds, Refunding,
3.900% due 05/01/2000 ................................... 280,550
---------------
3,400,550
---------------
MINNESOTA - 1.8%
550,000 Minnesota State, Unlimited Tax General Obligation Bonds,
(Pre-refunded to
08/01/2000 @ 100),
7.000% due 08/01/2006 ................................... 563,077
---------------
MISSOURI - 3.2%
500,000 Columbia, Water & Electric Revenue,
Series B,
3.500% due 12/01/2015+ .................................. 500,000
500,000 Kansas City Industrial Development Authority, Hospital
Revenue Bonds, Baptist Health System, Series A,
3.600% due 08/01/2018+ .................................. 500,000
---------------
1,000,000
---------------
NEVADA - 7.9%
500,000 Clark County, Transportation Improvement, Limited Tax
General Obligation Bonds, (Pre-refunded to 11/01/1999 @
100),
5.500% due 11/01/2002 ................................... 500,000
875,000 Clark County, Sanitation District, Limited Tax General
Obligation Bonds, Refunding,
5.250% due 07/01/2000 ................................... 884,206
1,105,000 Henderson, Local Improvement District, Refunding Special
Assessment Bonds, Series A,
3.600% due 11/01/1999 ................................... 1,105,000
---------------
2,489,206
---------------
NEW YORK - 2.0%
300,000 Jefferson County, Industrial Development Agency Revenue
Bonds, Watertown-Carthage TV,
3.750% due 12/01/2012+ .................................. 300,000
320,000 Long Island Power Authority, Electric Systems Revenue,
Subordinated Revenue Bonds, Series 6,
3.650% due 05/01/2033+ .................................. 320,000
---------------
620,000
---------------
NORTH CAROLINA - 6.4%
North Carolina Educational Facilities Financing Agency,
Revenue Bonds (Elon College):
700,000 3.500% due 09/01/2020+ .................................. 700,000
700,000 3.450% due 01/01/2021+ .................................. 700,000
620,000 Wake County, Industral Facilities & Pollution Control
Financing Authority, (Carolina Power & Light Company),
Series A,
3.450% due 05/01/2015+ .................................. 620,000
---------------
2,020,000
---------------
OHIO - 4.2%
100,000 Mount Vernon Waterworks Revenue, Revenue Bonds,
3.000% due 12/01/1999 ................................... 100,000
240,000 Norwalk City School District, Unlimited Tax General
Obligation Bonds,
3.000% due 12/01/1999 ................................... 240,000
1,000,000 Ohio State Public Facilities Commission, Higher Education
Capital Facilities Revenue Bonds, Series II-A,
4.375% due 11/01/1999 ................................... 1,000,000
---------------
1,340,000
---------------
PENNSYLVANIA - 2.5%
800,000 Philadelphia, Water & Wastewater Revenue Bonds, Series B,
3.450% due 08/01/2027+ .................................. 800,000
---------------
TENNESSEE - 3.6%
250,000 Chattanooga-Hamilton County, Hospital Authority Revenue,
(Erlanger Medical Center),
5.000% due 10/01/2000 ................................... 252,560
500,000 Metropolitan Government Nashville & Davidson County,
Industrial Development Board, MFHR, (Chimneytop II),
3.450% due 09/01/2006+ .................................. 500,000
390,000 Metropolitan Nashville Airport Revenue Authority, Special
Facilities Revenue Bonds, (American Airlines Project),
Series A,
3.650% due 10/01/2012+ .................................. 390,000
---------------
1,142,560
---------------
TEXAS - 15.2%
$ 500,000 Austin County, Industrial Development Corporation, (Justin
Industries, Inc. Project),
3.500% due 12/01/2014+ .................................. $ 500,000
235,000 Brownsville, Independent School District, Unlimited Tax
General Obligation Bonds,
7.250% due 08/15/2000 ................................... 241,207
500,000 Denton, Certificates of Obligation,
5.100% due 02/15/2000 ................................... 501,880
400,000 Grapevine, Industrial Development Corporation Revenue
Bonds, (American Airlines), Series A4,
3.650% due 12/01/2024+ .................................. 400,000
300,000 Harris County, Unlimited Tax General Obligation Bonds, ETM,
8.200% due 05/01/2000 ................................... 300,000
500,000 Lower Neches Valley, Industrial Development Corporation,
Pollution Control Revenue Bonds, (Neches River Treatment
Corporation Project), Series 1994A, (Guaranteed By Mobil
Corporation),
3.500% due 02/01/2004+,++ ............................... 500,000
590,000 McLennan County, Junior College, Limited Tax General
Obligation Bonds,
5.875% due 08/15/2000 ................................... 599,637
375,000 Midwestern State University, University Revenue Refunding,
Public Financing Authority Systems, Revenue Bonds,
3.650% due 12/01/1999 ................................... 375,043
500,000 Richardson, Independent School District, Unlimited Tax
General Obligation Bonds, Series C,
6.000% due 02/15/2000 ................................... 503,153
900,000 Texas State, Veterans Housing Assistance Fund I, Unlimited
Tax General Obligation Bonds,
3.450% due 12/01/2016+ .................................. 900,000
---------------
4,820,920
---------------
WASHINGTON - 11.8%
290,000 Bainbridge Island, Refundable & Improvement, Limited Tax
General Obligation Bonds,
4.000% due 12/01/1999 ................................... 290,186
250,000 Northeast Lake Washington, Sewer District, Sewer Revenue
Bonds, ETM,
6.100% due 03/01/2000 ................................... 250,000
600,000 Richland, Golf Enterprise Revenue Bonds,
3.400% due 12/01/2021+ .................................. 600,000
940,000 Seattle Housing Authority, Low Income Housing Assistance
Revenue Bonds, (Bayview Manor Project), Series B,
3.400% due 05/01/2019+ .................................. 940,000
255,000 Silver Lake, Water District, Water & Sewer Revenue Bonds,
3.000% due 12/01/1999 ................................... 255,000
290,000 Snohomish & Island Counties, School District No. 401
Stanwood, Unlimited Tax General Obligation Bonds,
3.250% due 12/15/1999 ................................... 290,000
500,000 Washington State, Unlimited Tax General Obligation Bonds,
Series 1995C, AT-8 and R-95B,
6.500% due 07/01/2000 ................................... 508,608
620,000 Whatcom County, School District No. 501 Bellingham,
Unlimited Tax General Obligation Bonds, Refunding,
4.000% due 12/01/1999 ................................... 620,448
---------------
3,754,242
---------------
WISCONSIN - 5.4%
1,225,000 Wisconsin State, Health and Educational Facilities
Authority Revenue Bonds, (Wheaton Franciscan Services),
3.550% due 08/15/2016 ................................... 1,225,000
500,000 Wisconsin State, Health Facilities Authority Revenue Bonds,
(Franciscan Health Care), Series A-1,
3.500% due 01/01/2016+ .................................. 500,000
---------------
1,725,000
---------------
Total State and Municipal Securities
(Cost $32,511,666) ...................................... 32,511,666
---------------
SHARES VALUE
------ -----
INVESTMENT COMPANY SECURITY - 0.3%
(Cost $98,439)
98,439 Dreyfus Tax-Exempt Cash Management Fund ................... 98,439
---------------
TOTAL INVESTMENTS (COST $32,610,105*) ................................ 102.9% 32,610,105
OTHER ASSETS AND LIABILITIES (NET) ................................... (2.9) (903,647)
---- ---------------
NET ASSETS ........................................................... 100.0% $ 31,706,458
===== ===============
- --------------

* Aggregate cost for federal tax purposes.
+ Variable rate security that is payable upon not more than seven calendar days' notice. The interest
rate shown reflects the rate currently in effect.
++ Obligations of various corporations and are not supported by other third party credit agreements.
</TABLE>

- --------------------------------------------------------------------------------
GLOSSARY OF TERMS

ETM -- Escrowed to Maturity
MFHR -- Multi-family Housing Revenue
- --------------------------------------------------------------------------------

See Notes to Financial Statements.

<PAGE>

PORTFOLIO of INVESTMENTS

CALIFORNIA MONEY FUND
OCTOBER 31, 1999

<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
------ -----
<C> <S> <C>
MUNICIPAL BONDS AND NOTES - 100.8%
CALIFORNIA - 100.8%
Alameda County, Industrial Development Authority Revenue:
$ 900,000 Heat and Control Inc. Project,
Series 1995A,
3.100% due 11/01/2025+ .................................. $ 900,000
500,000 JMS Family Partnership, Series A,
3.100% due 10/01/2025+ .................................. 500,000
100,000 Transportation Authority Sales Tax Revenue,
5.200% due 11/01/1999 ................................... 100,000
Anaheim, COP:
200,000 1993 Refunding Projects,
3.150% due 08/01/2019+ .................................. 200,000
100,000 Police Facility Refinancing Project,
3.150% due 08/01/2008+ .................................. 100,000
200,000 Big Bear Lake, Industrial Revenue, Southwest Gas
Corporation Project, Series A,
3.250% due 12/01/2028+ .................................. 200,000
California Health Facilities Financing Authority:
1,000,000 Insured Health Facilities Revenue Bonds, (Valleycare
Hospital Corporation), Series A, (Pre-refunded to 05/01/
2000 @ 102),
7.000% due 05/01/2020+ .................................. 1,037,502
800,000 Pooled Loan Program, Revenue Bonds,
Series B,
3.400% due 10/01/2010+ .................................. 800,000
Scripps Health, Insured Revenue Bonds:
200,000 Series A,
3.250% due 10/01/2022+ .................................. 200,000
300,000 Series B,
3.250% due 10/01/2022+ .................................. 300,000
California Pollution Control Financing Authority:
Homestake Mining Company, Revenue Bonds:
100,000 Series 1984A,
2.850% due 05/01/2004+ .................................. 100,000
300,000 Series 1984B,
2.850% due 05/01/2004+ .................................. 300,000
Pacific Gas & Electric Corporation, Pollution Control
Revenue Refunding Bonds:
1,500,000 Series C,
2.950% due 12/01/2016+ .................................. 1,500,000
400,000 Series D,
3.500% due 11/01/2026+ .................................. 400,000
100,000 California State Public Works Board, Lease Revenue,
Department of Corrections, State Prisons, Refunding,
Series A,
4.500% due 12/01/1999 ................................... 100,121
1,500,000 California Statewide Communities Development Corporation,
IDR, Tri-Valley Growers, Series 1995F,
3.550% due 12/01/2010+ .................................. 1,500,000
1,000,000 California Transportation Finance Authority, Revenue Bonds,
3.400% due 10/01/2027+ .................................. 1,000,000
900,000 Chula Vista, Charter City Revenue Bonds, Home Depot Inc.
Project,
3.100% due 12/01/2010+ .................................. 900,000
300,000 Duarte, Redevelopment Agency, Piken Duarte Partners, COP,
Series A,
3.200% due 12/01/2014+ .................................. 300,000
East Bay, Municipal Utility District, Water System
Subordinated Revenue Bonds, (Pre-refunded to 06/01/2000 @
102):
535,000 7.500% due 06/01/2018 ................................... 559,266
580,000 7.600% due 06/01/2020 ................................... 606,637
500,000 El Dorado County, Public Agency, Financing Authority
Revenue Bonds,
4.400% due 02/15/2000 ................................... 501,295
1,500,000 Fremont, Unified High School District, Santa Clara County,
TRAN,
3.250% due 06/30/2000 ................................... 1,498,545
800,000 Irvine Ranch, Water District, Nos. 105, 140, 240 & 250,
Unlimited Tax General Obligation Bonds,
3.500% due 01/01/2021 ................................... 800,000
1,000,000 Livermore, MFHR, Portola Meadows Apartments, Series 1989A,
3.200% due 05/01/2019+ .................................. 1,000,000
700,000 Los Angeles County, Pension Obligation, Refunding Revenue,
Series A,
3.150% due 06/30/2007+ .................................. 700,000
1,000,000 Los Angeles County, Transportation Commission Sales Tax
Refunding Revenue Bonds, Series 1992A,
3.150% due 07/01/2012+ .................................. 1,000,000
880,000 Los Angeles County, Unified School District, COP, Belmont
Learning Complex,
Series 1997A,
3.250% due 12/01/2017+ .................................. 880,000
100,000 Northern California Transmission Revenue, California-Oregon
Transmission Projects, Series A, (Pre-refunded to 05/01/
2000 @ 101.50),
7.000% due 05/01/2024 ................................... 103,320
1,000,000 Oakland, Joint Powers Financing Authority, Lease Revenue,
Series A-1,
2.800% due 08/01/2021 ................................... 1,000,000
1,000,000 Orange County, Apartment Development Revenue, Wood Canyon
Villas,
3.150% due 12/01/2021+ .................................. 1,000,000
1,100,000 Orange County, COP, Florence Crittendoc Services,
3.200% due 03/01/2016+ .................................. 1,100,000
1,500,000 Orange County, Fire Authority, TRAN,
4.500% due 07/12/2000 ................................... 1,510,564
100,000 Orange County, Special Financing Authority, Teeter Plan
Revenue Bonds, Series B, (Remarketed 11/01/1997),
3.350% due 11/01/2014 ................................... 100,000
1,000,000 Rancho Mirage, Joint Powers Financing Authority, COP,
Eisenhower Medical Center, Series 1997B,
3.250% due 07/01/2022+ .................................. 1,000,000
1,200,000 Regional Airports Improvement Corporation, Los Angeles
Terminal Facilities Completion,
3.700% due 12/01/2025+ .................................. 1,200,000
964,000 Riverside County, Public Facilities Authority, COP,
Series B,
2.900% due 12/01/2015+ .................................. 964,000
230,000 Sacramento County, Board of Education, COP, Refunding,
4.000% due 03/01/2000 ................................... 230,758
1,000,000 Sacramento, Municipal Utility District, Commercial Paper
Notes, Series I,
2.900% due 11/10/1999 ................................... 1,000,000
300,000 San Diego, Multi-family Mortgage Revenue Bonds,
2.650% due 08/01/2014+ .................................. 300,000
500,000 San Diego, TAN, Series A,
4.250% due 09/29/2000 ................................... 503,871
730,000 San Diego, Unified School District, 1999-2000 TRAN,
Series A,
4.250% due 09/29/2000 ................................... 734,625
500,000 San Dimas, Redevelopment Agency, Diversified Shopping, COP,
Refunding,
3.100% due 12/01/2005 ................................... 500,000
1,500,000 San Francisco City & County, Redevelopment Agency, MFHR,
Fillmore Center, Series A-1,
3.200% due 12/01/2017+ .................................. 1,500,000
1,000,000 San Jose, Redevelopment Agency Revenue, Merged Area
Redevelopment Project, Series B,
2.850% due 07/01/2026+ .................................. 1,000,000
500,000 South Orange County, Public Financing Authority,
Reassessment Revenue, Special Assessment Bonds,
3.700% due 09/02/2000 ................................... 500,000
Southern California Public Power Authority Revenue:
700,000 Palo Verde Project, Series C,
3.150% due 07/01/2017+ .................................. 700,000
1,200,000 Transmission Project,
3.150% due 07/01/2019+ .................................. 1,200,000
395,000 West Covina, Redevelopment Agency Lease Revenue Bonds,
Lakes Public Parking Project,
2.950% due 08/01/2018+ .................................. 395,000
------------
Total Municipal Bonds and Notes
(Cost $34,525,504) ...................................... 34,525,504
------------
SHARES
------
INVESTMENT COMPANY SECURITY - 0.3%
(Cost $110,843)
110,843 Dreyfus Basic California Municipal Money Market Fund ...... 110,843
------------
TOTAL INVESTMENTS (COST $34,636,347*) ................................ 101.1% 34,636,347
OTHER ASSETS AND LIABILITIES (NET) ................................... (1.1) (367,486)
----- ------------
NET ASSETS ........................................................... 100.0% $ 34,268,861
===== ============
- --------------
* Aggregate cost for federal tax purposes.
+ Variable rate security that is payable on demand or upon a five business days' notice, and secured
by a letter of credit, liquidity agreement or other credit support. The interest rates shown
reflects the rate currently in effect.
</TABLE>

- -------------------------------------------------------------------------------
GLOSSARY OF TERMS
COP -- Certificate of Participation
IDR -- Industrial Development Revenue
MFHR -- Multi-family Housing Revenue
TAN -- Tax Anticipation Notes
TRAN -- Tax and Revenue Anticipation Notes
- -------------------------------------------------------------------------------

See Notes to Financial Statements.

<PAGE>

NOTES to FINANCIAL statements
WM GROUP OF FUNDS

1. ORGANIZATION AND BUSINESS

WM Trust I ("Trust I") and WM Trust II ("Trust II") were organized under the
laws of the Commonwealth of Massachusetts on September 19, 1997 and February
22, 1989, respectively, as business entities commonly known as "Massachusetts
business trusts." Trust I and Trust II are each registered under the
Investment Company Act of 1940, as amended (the "1940 Act"), as open-end
management investment companies. The Trusts consist of 18 funds as follows:

TRUST I TRUST II

EQUITY FUNDS EQUITY FUNDS
Bond & Stock Fund Growth Fund
Growth & Income Fund Emerging Growth Fund
Northwest Fund International Growth Fund

FIXED INCOME FUNDS FIXED INCOME FUNDS
U.S. Government Securities Fund Short Term High Quality Bond Fund
Income Fund Target Maturity 2002 Fund
High Yield Fund
MUNICIPAL FUNDS
MUNICIPAL FUND California Municipal Fund
Tax-Exempt Bond Fund California Insured Intermediate Municipal Fund
Florida Insured Municipal Fund
MONEY MARKET FUNDS
Money Market Fund MONEY MARKET FUND
Tax-Exempt Money Market Fund California Money Fund

Information presented in these financial statements pertains only to the Money
Market Funds, hereafter referred to as the "Funds." The financial statements
for the Equity Funds, Fixed Income Funds and the Municipal Funds are presented
in a separate report.

WM Advisors, Inc. (the "Advisor" or "WM Advisors"), a wholly-owned subsidiary
of Washington Mutual, Inc. ("Washington Mutual"), a publicly owned financial
services company, serves as investment advisor to the Trusts.

The Money Market Fund offers three classes of shares: Class A shares, Class B
shares and Class I shares. The Tax-Exempt Money Market Fund and the California
Money Fund currently offer Class A and Class B shares. Effective July 11,
1999, seed money was withdrawn from the Class I shares of the Tax Exempt Money
Market Fund and California Money Fund, although they are still authorized and
could be issued. Effective as of the close of business on July 16, 1999 the
Money Market Fund's Class S shares were converted into Class B shares and the
California Money Fund's Class S shares were terminated. Class A shares of the
Funds are not subject to an initial or contingent deferred sales charge
("CDSC"). Certain Class A shares purchased by exchange from another Fund
within the Trusts may be subject to a CDSC if redeemed within two years of
purchase. Class B shares are not subject to an initial sales charge although
they are generally subject to a CDSC if redeemed within five years of
purchase. Class I shares are not available for direct purchase by investors
and are not subject to an initial sales charge or CDSC.

2. SIGNIFICANT ACCOUNTING POLICIES

The preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts and disclosures in the financial statements.
Actual results could differ from those estimates. The following is a summary
of significant accounting policies consistently followed by the Funds in the
preparation of their financial statements.

PORTFOLIO VALUATION:

Securities are valued on the basis of amortized cost, which approximates
market value. Amortized cost valuation involves initially valuing an
instrument at its cost and thereafter assuming a constant amortization to
maturity of any discount or premium, as long as the effect of fluctuating
interest rates on the market value of the instrument is not significant.
Restricted securities and certain other assets are valued by the investment
advisor under the supervision of the Board of Trustees.

REPURCHASE AGREEMENTS:

Each Fund may engage in repurchase agreement transactions. A repurchase
agreement is a purchase of an underlying debt obligation subject to an
agreement by the seller to repurchase the obligation at an agreed upon price
and time. The value of the collateral is at all times at least equal to the
total amount of the repurchase obligation. In the event of counterparty
default, the Fund would seek to use the collateral to offset losses incurred.
There is potential loss in the event the Fund is delayed or prevented from
exercising its right to dispose of the collateral securities, including the
risk of a possible decline in the value of the underlying securities during
the period while the Fund seeks to assert its rights. WM Advisors, acting
under the supervision of the Board of Trustees, reviews the value of the
collateral and the creditworthiness of those banks and dealers with whom each
Fund enters into repurchase agreements.

ILLIQUID INVESTMENTS:

Up to 10% of the net assets of the Funds may be invested in securities that
are not readily marketable, including: (1) repurchase agreements with
maturities greater than seven calendar days; (2) time deposits maturing in
more than seven calendar days; (3) to the extent a liquid secondary market
does not exist for the instruments, futures contracts and options thereon; (4)
certain over-the-counter options; (5) certain variable rate demand notes
having a demand period of more than seven days; and (6) securities, the
disposition of which are restricted under Federal securities laws, excluding
certain Rule 144A securities, as defined below.

Illiquid securities generally cannot be sold or disposed of in the ordinary
course of business (within seven days) at approximately the value at which the
Funds have valued the investments. This may have an adverse effect on the
Fund's ability to dispose of particular illiquid securities at fair market
value and may limit the Fund's ability to obtain accurate market quotations
for purposes of valuing the securities and calculating the net asset value of
shares of the Fund. The Funds may also purchase securities that are not
registered under the Securities Act of 1933, as amended (the "Act"), but that
can be sold to qualified institutional buyers in accordance with Rule 144A
under the Act ("Rule 144A Securities"). Rule 144A Securities generally may be
resold only to other qualified institutional buyers. If a particular
investment in Rule 144A Securities is not determined to be liquid under the
guidelines established by the Board of Trustees, that investment will be
included within the 10% limitation, as applicable, on investments in illiquid
securities.

SECURITIES TRANSACTIONS AND INVESTMENT INCOME:

Securities transactions are recorded as of the trade date (the date the order
to buy or sell is executed). Realized gains and losses from securities sold
are recorded on the identified cost basis. Interest income is recorded on the
accrual basis and consists of interest accrued and, if applicable, discount
accreted less premiums amortized. Each Fund's investment income and realized
and unrealized gains and losses are allocated among the classes of that Fund
based upon the relative average net assets of each class.

Securities purchased or sold on a when-issued or delayed-delivery basis may be
settled a month or more after the trade date; interest income is not accrued
until settlement date. Each Fund instructs the custodian to segregate assets
of the Fund with a current value at least equal to the amount of its when-
issued purchase commitments.

DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS:

Dividends from net investment income of the Funds are declared daily and paid
monthly. Distributions of any net capital gains earned by a Fund are
distributed no less frequently than annually at the discretion of the Board of
Trustees. Additional distributions of net investment income and capital gains
for each Fund may be made at the discretion of the Board of Trustees in order
to avoid the application of a 4% non-deductible excise tax on certain
undistributed amounts of ordinary income and capital gains. Income
distributions and capital gain distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles. These differences are primarily due to timing differences and
differing characterizations of distributions made by each Fund as a whole. Net
investment income per share calculations in the financial highlights for the
year ended October 31, 1999 excludes these adjustments:

DECREASE
INCREASE ACCUMULATED
INCREASE/ UNDISTRIBUTED NET
(DECREASE) NET INVESTMENT REALIZED
NAME OF FUND PAID-IN CAPITAL INCOME GAIN
- ------------ --------------- ------ ----
Money Market Fund ........... $(3,347) $3,587 $ (240)
Tax-Exempt Money Market Fund
4,913 -- (4,913)
California Money Fund .......
(1,305) 1,305 --

FEDERAL INCOME TAXES:

It is each Fund's policy to qualify as a regulated investment company by
complying with the requirements of the Internal Revenue Code of 1986, as
amended, applicable to regulated investment companies and by, among other
things, distributing substantially all of its taxable and tax-exempt earnings
to its shareholders. Therefore, no Federal income tax provision is required.

EXPENSES:

General expenses of the Trust are allocated to all the Funds based upon
relative net assets of each Fund except printing and postage expenses, which
are allocated to all the Funds based upon the relative number of shareholder
accounts of each Fund. Operating expenses directly attributable to a class of
shares are charged to the operations of that class of shares. Expenses of each
Fund not directly attributable to the operations of any class of shares are
prorated among the classes to which the expenses relate based on the relative
average net assets of each class of shares.

3. INVESTMENT ADVISORY AND OTHER TRANSACTIONS

WM Advisors serves as investment advisor to the Funds. The Advisor is entitled
to a monthly fee, in arrears, based on a percentage of the average daily net
assets of each Fund at the following rates:

FEES ON NET ASSETS FEES ON NET ASSETS
UP TO EXCEEDING
NAME OF FUND $1 BILLION $1 BILLION
- ------------ ---------- ----------
Money Market Fund ................ .45% .40%
Tax-Exempt Money Market Fund ..... .45% .40%

FEES ON NET ASSETS FEES ON ASSETS
UP TO EXCEEDING
NAME OF FUND $500 MILLION $500 MILLION
- ------------ ------------ ------------
California Money Fund ............ .45% .40%

WM Advisors provides administration services to the Trusts at no additional
fee.

The Advisor has agreed to waive a portion of its management fees. Fees waived
by the Advisor for the year ended October 31, 1999 are as follows:

NAME OF FUND FEES WAIVED
- ------------ -----------
Tax-Exempt Money Market Fund ..... $104,700

WM Shareholder Services, Inc. (the "Transfer Agent") serves as the transfer
and shareholder servicing agent of the Funds. Shareholder servicing fees were
paid to the Transfer Agent for services incidental to issuance and transfer of
shares, maintaining shareholder lists, and issuing and mailing distributions
and reports. Effective as of the close of business on July 16, 1999, there
were no longer any Transfer Agent fees associated with Class S shares. The
authorized monthly shareholder servicing fees are as follows:

CLASS A CLASS B & S
------- -----------
The Money Market Funds:
(11/01/1998 -- 09/30/1999):
First 25,000 accounts .......................... $1.85 $1.95
Each additional account ........................ 1.55 1.65
(10/01/1999 -- 10/31/1999):
All accounts ................................... 1.65 1.65

Class I shares are not subject to shareholder servicing fees.

Custodian fees for certain Funds have been reduced by credits allowed by the
custodian for uninvested cash balances. These Funds could have invested this
cash in income producing investments. Fees reduced by credits allowed by the
custodian for the year ended October 31, 1999 are shown separately in the
Statements of Operations.

4. TRUSTEES' FEES

No director, officer or employee of Washington Mutual or its subsidiaries
receives any compensation from the Trusts for serving as an officer or Trustee
of the Trusts. The Trusts, together with other mutual funds advised by WM
Advisors, Inc., pays each Trustee who is not a director, officer or employee of
Washington Mutual or its subsidiaries, $18,000 per annum plus $3,000 per board
meeting attended and $1,000 per board meeting attended by telephone. Trustees
are also reimbursed for travel and out-of-pocket expenses. The Chairman of each
committee receives an additional $500 per committee meeting attended.

Pursuant to an exemptive order granted by the Securities and Exchange
Commission, the Trust's eligible Trustees may participate in a deferred
compensation plan (the "Plan") which may be terminated at any time. Under the
Plan, Trustees may elect to defer receipt of all or a portion of their fees
which, in accordance with the Plan, are invested in mutual fund shares. Upon
termination of the Plan, Trustees that have deferred accounts under the Plan
will be paid benefits no later than the time the payments would otherwise have
been made without regard to such termination. All benefits provided under these
plans are funded and any payments to Plan participants are paid solely out of
the Trusts' assets

5. DISTRIBUTION PLANS

WM Funds Distributor, Inc. (the "Distributor"), a registered broker-dealer and
indirect wholly-owned subsidiary of Washington Mutual, serves as distributor
for Class A and B shares. Prior to the close of business on July 16, 1999 it
also served as distributor to Class S shares of the Funds. For the year ended
October 31, 1999, the Distributor received $325,218 representing CDSC fees
from Class B and S shares. WM Financial Services, Inc. ("WM Securities) also
serves as a registered broker-dealer for the Funds. For the year ended October
31, 1999, WM Securities received $28,304, representing CDSC fees from Class B
and S shares.

Each of the Funds has adopted two distribution plans, pursuant to Rule 12b-1
under the 1940 Act, applicable to Class A shares and Class B shares of the
Fund (each, a "Rule 12b-1 Plan"), respectively. There is no distribution plan
applicable to the Money Market Fund's Class I shares. Under the applicable
Rule 12b-1 Plans, the Distributor may receive a service fee at an annual rate
of 0.25% of the average daily net assets of both classes. The Trustees have
not authorized, and the Funds do not currently pay, service fees with respect
to Class A shares. In addition, the Distributor is paid a fee as compensation
in connection with the offering and sale of Class B shares at an annual rate
of 0.75% of the average daily net assets of such shares. These fees may be
used to cover the expenses of the Distributor primarily intended to result in
the sale of such shares, including payments to the Distributor's
representatives or others for selling shares. Because the Distributor may
retain any amount of its fee that is not so expended, the Rule 12b-1 Plans are
characterized by the SEC as "compensation-type" plans. The service fee is paid
by the Fund to the Distributor, which in turn, pays a portion of the service
fee to broker/dealers that provide services, such as accepting telephone
inquiries and transaction requests and processing correspondences, new account
applications and subsequent purchases by check for the shareholders. Under
their terms, both the Class A Plan and the Class B Plan shall remain in effect
from year to year, provided such continuance is approved annually by vote of
the Board of Trustees, including a majority of those Trustees who are not
"interested persons" of the Trusts, as defined in the 1940 Act, as those
persons who have no direct or indirect financial interest in the operation of
such distribution plans, or any agreements related to such plans.

Prior to the close of business on July 16, 1999, each of the Funds had adopted
a distribution plan, pursuant to Rule 12b-1 under the 1940 Act, applicable to
Class S shares (a "Class S Rule 12b-1 Plan"). Under the applicable Class S
Rule 12b-1 Plan, the Distributor received a service fee at an annual rate of
0.25% of the average daily net assets of Class S shares. In addition, the
Distributor was paid a fee as compensation in connection with the offering and
sale of Class S shares at an annual rate of 0.75% of the average daily net
assets.

6. SHARES OF BENEFICIAL INTEREST

The Trusts may issue an unlimited number of shares of beneficial interest,
each without par value.

As of October 31, 1999, WM Shareholder Services, Inc. owned greater than five
percent of Class I of the following Fund:

NUMBER OF PERCENTAGE OF
NAME OF FUND FUND SHARES TOTAL FUND SHARES
- ------------ ----------- -----------------
Money Market Fund ........................ 7,569,646 7.37%

7. CAPITAL LOSS CARRYFORWARDS

At October 31, 1999, the following Funds had available for federal income tax
purposes unused capital losses as follows:

<TABLE>
<CAPTION>
EXPIRING EXPIRING EXPIRING EXPIRING EXPIRING EXPIRING EXPIRING EXPIRING
IN 2000 IN 2001 IN 2002 IN 2003 IN 2004 IN 2005 IN 2006 IN 2007
------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Money Market Fund ............... $ -- $ -- $ -- $ -- $109 $ -- $73,698 $--
Tax-Exempt Money Market Fund -- -- -- 4,639 -- -- -- 249
California Money Fund ........... 5,715 7,549 1,294 18,781 -- -- -- 2
</TABLE>

8. GEOGRAPHIC AND INDUSTRY CONCENTRATION AND RISK FACTORS

There are certain risks arising from the concentration of California Money
Fund's investments in California municipal securities. The California Money
Fund is more susceptible to factors adversely affecting issuers of California
municipal securities than a fund that is not concentrated in these issuers to
the same extent. Uncertain economic conditions or governmental developments
may affect the ability of California municipal securities issuers to meet
their financial obligations.

9. REORGANIZATION

On March 8, 1999, each Acquiring Fund, as listed below acquired the assets and
certain liabilities of the Acquired Fund, also listed below, in a tax-free
exchange for shares of the Acquiring Fund, pursuant to a plan of
reorganization approved by the Acquired Fund's shareholders. Total shares
issued by the Acquiring Fund, the value of the shares issued by the Acquiring
Fund, the total net assets of the Acquired Fund and the Acquiring Fund are as
follows:

<TABLE>
<CAPTION>
TOTAL TOTAL TOTAL NET
SHARES VALUE OF TOTAL NET TOTAL NET ASSETS OF
ISSUED BY SHARES ISSUED ASSETS OF ASSETS OF ACQUIRING
ACQUIRING BY ACQUIRING ACQUIRED ACQUIRING FUND AFTER
ACQUIRING FUND ACQUIRED FUND FUND FUND FUND FUND ACQUISITION
- -------------- ------------- ---- ---- ---- ---- -----------
<S> <C> <C> <C> <C> <C> <C>
WM Money Market Fund Griffin Money Market Fund 227,709,262 $227,709,262 $227,709,262 $497,903,478 $725,612,740

WM Tax-Exempt Griffin Tax-Free
Money Market Fund Money Market Fund 21,062,829 21,062,829 21,062,829 24,092,383 45,155,212
</TABLE>

10. CONTRIBUTION IN KIND

Effective as of the close of business on July 16, 1999, the Griffin Portfolio
Builder Accounts (asset allocation accounts that were invested in Class A shares
of certain Funds in the WM Group of Funds) redeemed in kind their investments in
Class A of the Money Market Fund and contributed these assets to the WM
Strategic Asset Management Portfolios (the "Portfolios"). The Portfolios used
these contributed assets to acquire shares in Class I of certain Funds in the WM
Group of Funds.

<PAGE>

INDEPENDENT auditors" REPORT

To the Trustees and Shareholders of
WM Money Market Fund, WM Tax-Exempt Money Market Fund
and WM California Money Fund:

We have audited the accompanying statements of assets and liabilities, including
the portfolios of investments, of WM Money Market Fund, WM Tax- Exempt Money
Market Fund and WM California Money Fund (the "Funds") as of October 31, 1999,
and the related statements of operations for the year then ended and the
statements of changes in net assets and financial highlights for the year then
ended and the periods ended October 31, 1998. 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. The statement of changes in net assets
for WM California Money Fund for the year ended June 30, 1998 and financial
highlights for the period ended June 30, 1998 and prior were audited by other
auditors whose report, dated August 14, 1998, expressed an unqualified opinion
on those statements. The statements of changes in net assets for WM Money Market
Fund and WM Tax-Exempt Money Market Fund for the year ended December 31, 1997
and financial highlights for the period ended December 31, 1997 and prior were
audited by other auditors whose report, dated January 20, 1998, expressed an
unqualified opinion on those statements.

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 and financial highlights. Our procedures included confirmation of
securities owned at October 31, 1999, by correspondence with the custodian and
brokers; where replies were not received from brokers, we performed other
auditing procedures. 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 the aforementioned
Funds at October 31, 1999, the results of their operations for the year then
ended and the changes in their net assets and their financial highlights for the
respective stated periods ended October 31, 1999, and 1998 in conformity with
generally accepted accounting principles.

Deloitte & Touche LLP
San Francisco, California
December 15, 1999

<PAGE>

TAX information (unaudited)
WM GROUP OF FUNDS

YEAR ENDED OCTOBER 31, 1999

The following tax information represents fiscal year end disclosures of various
tax benefits passed through to shareholders at calendar year end.

Of the distributions made from investment income the following percentages are
tax-exempt for regular Federal income tax purposes:

NAME OF FUND
- ------------
Tax-Exempt Money Market Fund .............................. 100%
California Money Fund ..................................... 100%

A portion of this income may be subject to alternative minimum tax.

The above figures may differ from those cited elsewhere in this report due to
differences in the calculation of income and capital gains for Securities and
Exchange Commission (book) purposes and Internal Revenue Service (tax)
purposes.

<PAGE>

This Annual Report is published for the general information of the shareholders
of the WM Group of Funds. It is authorized for distribution to prospective
investors only when preceded or accompanied by a current WM Group of Funds
prospectus. A mutual fund's share price and investment return will vary with
market conditions, and the principal value of an investment when you sell your
shares may be more or less than the original cost.

The WM Group of Funds are not insured by the FDIC. They are not deposits or
obligations of, nor are they guaranteed by, any bank. These securities are
subject to investment risk, including possible loss of principal amount
invested.

Distributed by WM Funds Distributor, Inc.

Member NASD

Bulk Rate
U.S. Postage
paid
No. Reading, MA
Permit #105

[logo] WM
GROUP OF FUNDS

P.O. Box 9757
Providence, RI 02940-9757

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