<PAGE>
[AIM LOGO APPEARS HERE] Dear Shareholder:
[PHOTO of Mixed signals from a vigorous economy were
Charles T. Bauer, the chief focus for fixed-income markets
Chairman of the during most of the past year. Although the
LETTER Board of the Fund Federal Reserve Board (the Fed) raised
TO OUR APPEARS HERE] interest rates only once during the fiscal
SHAREHOLDERS year covered by this report, the period was
marked by considerable fluctuation in the money markets.
In March 1997, the Fed raised the key short-term target,
namely the federal funds rate, from 5.25% to 5.50%. That action
was in response to concern about the inflationary potential of
strong economic growth during the last quarter of 1996 and the
first quarter of 1997. Short-term yields rose as markets
anticipated another increase in interest rates at the Fed's next
meeting in May.
But when signs of a slowing economy appeared, the Fed decided
not to raise rates further in May. Money market yields fell
significantly, reflecting changed expectations of near-term
interest rate stability. In fact, the federal funds rate remained
unchanged from March through Short-Term Investments Trust
Treasury Portfolio's August 31 fiscal year-end.
The economy continued to display considerable resilience,
growing at a 3.3% annual rate during the second quarter of 1997.
Though there were no outward signs of inflation, the extension of
a strong growth pattern heightened uncertainty about Fed policy,
and that led to increased volatility in the money markets.
As the fiscal year closed, the yield on Treasury bills had
dropped dramatically. One contributing cause was an inflow of
foreign money seeking safety and liquidity, which pushed up
prices. The yield on a one-year T-bill was less than 50 basis
points higher than the yield on a three-month T-bill.
YOUR INVESTMENT PORTFOLIO
Since there was little reason to extend the maturities to pick up
yield over the cash management portion of the Portfolio's
holdings, Portfolio managers maintained a relatively short
weighted average maturity (WAM) in the 20- to 30-day range.
Employing a barbell structure, the Portfolio was able to take
advantage of the higher-yielding overnight market while looking
for strategic opportunities in longer maturities. The short WAM
was appropriate given the uncertainty about future rate hikes, as
it enables Portfolio managers to react swiftly to changing
interest rates. At the close of the reporting period, the
weighted average maturity of the portfolio was 24 days.
Using this strategy, the Private Investment Class of the
Portfolio outperformed its comparative indexes as of August 31,
1997, as shown in the table.
YIELDS AS OF 8/31/97 Average Seven-Day
Monthly Yield Yield
Treasury Portfolio
Private Investment Class 5.23% 5.27%
IBC Money Fund Averages(TM)
U.S. Treasury &
Repurchase Agreements 4.86% 4.87%
IBC Money Fund Averages(TM)
Government Only/Institutions Only 5.16% 5.18%
(continued)
<PAGE>
The Portfolio also continues to hold the highest credit
quality ratings given by two widely known credit-rating agencies:
AAAm from Standard & Poor's Corporation and Aaa from Moody's
Investors Service, Inc. The ratings are historical and are based
on an analysis of the Portfolio's credit quality, composition,
management, and weekly portfolio reviews.
Net assets of the Private Investment Class stood at $463.44
million as of August 31, 1997, up from $352.54 million as of
August 31, 1996.
The Treasury Portfolio seeks to maximize current income to
the extent consistent with preservation of capital and
maintenance of liquidity. It invests exclusively in direct
obligations of the U.S. Treasury and repurchase agreements
secured by such obligations. Government securities, such as U.S.
Treasury bills and bonds, offer a high degree of safety and are
guaranteed as to the timely payment of principal if held to
maturity. As with any money market fund, an investment in
Treasury Portfolio is neither insured nor guaranteed by the U.S.
government, the FDIC, or a bank, and there can be no assurance
that the Portfolio will be able to maintain a stable net asset
value of $1.00 per share.
OUTLOOK FOR THE FUTURE
As the reporting period closed, the general expectation was that
the economy would continue to grow at a sustainable annual pace
of 2% to 3% and that inflation would remain under control.
However, underlying strength in various economic indicators,
including consumer spending and capital expenditures by
companies, signals the potential for faster growth, which could
trigger higher short-term rates later this year. This uncertainty
could cause interest rates to remain volatile through the close
of 1997.
The Portfolio expects to continue to maintain a relatively
short maturity structure, remaining flexible to take advantage of
any sudden rise in market yields or further rate increases by the
Fed.
We are pleased to send you this report concerning your
investment. AIM remains committed to the primary goals of safety,
liquidity and yield in institutional fund management. We are also
committed to customer service and are ready to respond to your
comments about this report and to any questions you may have.
Please contact one of our representatives at 800-659-1005 if we
may be of service.
Respectfully submitted,
/s/ CHARLES T. BAUER
Charles T. Bauer
Chairman
2
<PAGE>
SCHEDULE OF INVESTMENTS
August 31, 1997
<TABLE>
<CAPTION>
MATURITY PAR (000) VALUE
<S> <C> <C> <C>
U.S. TREASURY SECURITIES - 12.94%
U.S. TREASURY BILLS(a) - 5.80%
5.33% 10/02/97 $ 50,000 $ 49,770,514
- ------------------------------------------------------------------------------
5.325% 01/08/98 25,000 24,522,969
- ------------------------------------------------------------------------------
5.28% 03/05/98 40,000 38,914,667
- ------------------------------------------------------------------------------
5.665% 04/02/98 25,000 24,162,052
- ------------------------------------------------------------------------------
5.53% 04/30/98 50,000 48,148,987
- ------------------------------------------------------------------------------
5.52% 05/28/98 50,000 47,937,667
- ------------------------------------------------------------------------------
5.235% 06/25/98 25,000 23,920,281
- ------------------------------------------------------------------------------
5.215% 07/23/98 25,000 23,823,004
- ------------------------------------------------------------------------------
5.245% 07/23/98 25,000 23,816,233
- ------------------------------------------------------------------------------
305,016,374
- ------------------------------------------------------------------------------
U.S. TREASURY NOTES - 7.14%
5.75% 09/30/97 50,000 50,012,312
- ------------------------------------------------------------------------------
8.75% 10/15/97 50,000 50,197,174
- ------------------------------------------------------------------------------
5.25% 12/31/97 50,000 49,944,119
- ------------------------------------------------------------------------------
7.875% 01/15/98 75,000 75,554,919
- ------------------------------------------------------------------------------
5.125% 03/31/98 50,000 49,757,722
- ------------------------------------------------------------------------------
5.125% 06/30/98 50,000 49,796,720
- ------------------------------------------------------------------------------
6.25% 06/30/98 25,000 25,133,372
- ------------------------------------------------------------------------------
8.25% 07/15/98 25,000 25,549,378
- ------------------------------------------------------------------------------
375,945,716
- ------------------------------------------------------------------------------
Total U.S. Treasury Securities 680,962,090
- ------------------------------------------------------------------------------
Total Investments (excluding Repurchase
Agreements) 680,962,090
- ------------------------------------------------------------------------------
REPURCHASE AGREEMENTS - 87.34%(b)
BT Securities Corp. 5.55%(c) 09/02/97 200,000 200,000,000
- ------------------------------------------------------------------------------
BZW Securities Inc. 5.57%(d) 09/02/97 200,000 200,000,000
- ------------------------------------------------------------------------------
Bear, Stearns & Co. Inc.
5.58%(e) -- 200,000 200,000,000
- ------------------------------------------------------------------------------
5.58%(f) -- 200,000 200,000,000
- ------------------------------------------------------------------------------
CIBC - Wood Gundy Securities Corp. 5.56%(g) 09/02/97 200,000 200,000,000
- ------------------------------------------------------------------------------
CS First Boston Corp. 5.53%(h) 09/02/97 200,000 200,000,000
- ------------------------------------------------------------------------------
Chase Securities, Inc. 5.55%(i) 09/02/97 200,000 200,000,000
- ------------------------------------------------------------------------------
Deutsche Morgan Grenfell/C.J. Lawrence,
Inc. 5.58%(j) -- 560,000 560,000,000
- ------------------------------------------------------------------------------
Goldman, Sachs & Co. 5.56%(k) 09/02/97 434,729 434,728,794
- ------------------------------------------------------------------------------
Greenwich Capital Markets, Inc. 5.57%(l) 09/02/97 200,000 200,000,000
- ------------------------------------------------------------------------------
HSBC Securities, Inc. 5.58%(m) 09/02/97 200,000 200,000,000
- ------------------------------------------------------------------------------
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
MATURITY PAR (000) VALUE
<S> <C> <C> <C>
REPURCHASE AGREEMENTS - (continued)
Merrill Lynch Government Securities Inc.
5.57%(n) 09/02/97 $200,000 $ 200,000,000
- -------------------------------------------------------------------------------
Morgan (J.P.) Securities Inc. 5.56%(o) 09/02/97 300,000 300,000,000
- -------------------------------------------------------------------------------
Morgan Stanley & Co. Inc. 5.58%(p) 09/02/97 200,000 200,000,000
- -------------------------------------------------------------------------------
Nesbitt Burns Securities Inc. 5.57%(q) -- 200,000 200,000,000
- -------------------------------------------------------------------------------
SBC Capital Markets Inc. 5.57%(r) 09/02/97 500,000 500,000,000
- -------------------------------------------------------------------------------
Sanwa Securities (USA) Co., L.P.
5.56%(s) 09/02/97 200,000 200,000,000
- -------------------------------------------------------------------------------
UBS Securities LLC 5.56%(t) -- 200,000 200,000,000
- -------------------------------------------------------------------------------
Total Repurchase Agreements 4,594,728,794
- -------------------------------------------------------------------------------
TOTAL INVESTMENTS - 100.28% 5,275,690,884 (u)
- -------------------------------------------------------------------------------
OTHER ASSETS LESS LIABILITIES - (0.28)% (14,902,379)
- -------------------------------------------------------------------------------
NET ASSETS - 100.00% $5,260,788,505
===============================================================================
</TABLE>
NOTES TO SCHEDULE OF INVESTMENTS:
(a) U.S. Treasury bills are traded on a discount basis. In such cases the
interest rate shown represents the rate of discount paid or received at the
time of purchase by the Portfolio.
(b) Collateral on repurchase agreements, including the Portfolio's pro-rata
interest in joint repurchase agreements, is taken into possession by the
Portfolio upon entering into the repurchase agreement. The collateral is
marked to market daily to ensure its market value as being 102% of the
sales price of the repurchase agreement. The investments in some repurchase
agreements are through participation in joint accounts with other mutual
funds, private accounts and certain non-registered investment companies
managed by the investment advisor or its affiliates.
(c) Entered into 08/29/97 with a maturing value of $200,123,333. Collateralized
by $163,725,000 U.S. Treasury obligations, 8.875% due 02/15/19 with a
market value at 08/31/97 of $204,764,696.
(d) Entered into 08/29/97 with a maturing value of $200,123,778. Collateralized
by $184,335,000 U.S. Treasury obligations, 0% to 11.25% due 12/04/97 to
02/15/15 with an aggregate market value at 08/31/97 of $204,000,005.
(e) Open repurchase agreement. Either party may terminate the agreement upon
demand. Interest rates, par and collateral are redetermined daily.
Collateralized by $821,051,000 U.S. Treasury obligations, 0% to 8.75% due
11/15/99 to 08/15/25 with an aggregate market value at 08/31/97 of
$206,717,583.
(f) Open repurchase agreement. Either party may terminate the agreement upon
demand. Interest rates, par and collateral are redetermined daily.
Collateralized by $500,628,000 U.S. Treasury obligations, 0% due 02/15/06
to 11/15/21 with an aggregate market value at 08/31/97 of $204,356,857.
(g) Entered into 08/29/97 with a maturing value of $200,123,556. Collateralized
by $194,543,000 U.S. Treasury obligations, 5.375% to 11.25% due 08/31/97 to
11/15/26 with an aggregate market value at 08/31/97 of $204,001,930.
(h) Entered into 08/29/97 with a maturing value of $200,122,889. Collateralized
by $208,810,000 U.S. Treasury obligations, 0% to 6.25% due 09/04/97 to
06/30/02 with an aggregate market value at 08/31/97 of $205,012,084.
(i) Entered into 08/29/97 with a maturing value of $200,123,333. Collateralized
by $193,386,000 U.S. Treasury obligations, 5.50% to 8.875% due 02/15/00 to
08/15/27 with an aggregate market value at 08/31/97 of $204,004,690.
(j) Open repurchase agreement. Either party may terminate the agreement upon
demand. Interest rates, par and collateral are redetermined daily.
Collateralized by $537,574,000 U.S. Treasury obligations 5.25% to 7.875%,
due 12/31/97 to 11/15/04 with an aggregate market value at 08/31/97 of
$571,200,459.
(k) Joint repurchase agreement entered into 08/29/97 with a maturing value of
$750,463,333. Collateralized by $698,212,000 U.S. Treasury obligations,
4.75% to 14.00% due 02/28/98 to 08/15/25 with an aggregate market value at
08/31/97 of $765,753,716.
(l) Entered into 08/29/97 with a maturing value of $200,123,778. Collateralized
by $137,530,000 U.S. Treasury obligations, 11.25% due 02/15/15 with a
market value at 08/31/97 of $204,003,754.
(m) Entered into 08/29/97 with a maturing value of $200,124,000. Collateralized
by $209,292,000 U.S. Treasury obligations, 0% due 02/19/98 to 02/26/98 with
an aggregate market value at 08/31/97 of $204,003,111.
(n) Entered into 08/29/97 with a maturing value of $200,123,778. Collateralized
by $534,773,000 U.S. Treasury obligations, 0% to 12.00% due 11/15/97 to
02/15/27 with an aggregate market value at 08/31/97 of $204,002,655.
4
<PAGE>
(o) Entered into 08/29/97 with a maturing value of $300,185,333. Collateralized
by $293,232,000 U.S. Treasury obligations, 5.625% to 13.25% due 11/15/97 to
05/15/14 with an aggregate market value at 08/31/97 of $306,000,820.
(p) Entered into 08/29/97 with a maturing value of $200,124,000. Collateralized
by $192,551,000 U.S. Treasury obligations, 7.00% to 8.75% due 04/15/99 to
02/15/23 with an aggregate market value at 08/31/97 of $204,014,896.
(q) Open repurchase agreement. Either party may terminate the agreement upon
demand. Interest rates, par and collateral are redetermined daily.
Collateralized by $598,149,000 U.S. Treasury obligations, 0% to 6.375% due
11/15/97 to 11/15/26 with an aggregate market value at 08/31/97 of
$204,000,427.
(r) Entered into 08/29/97 with a maturing value of $500,309,444. Collateralized
by $672,387,000 U.S. Treasury obligations, 0% to 6.875% due 11/13/97 to
08/15/20 with an aggregate market value at 08/31/97 of $511,373,725.
(s) Entered into 08/29/97 with a maturing value of $200,123,556. Collateralized
by $195,073,000 U.S. Treasury obligations, 4.75% to 11.875% due 11/30/97 to
11/15/22 with an aggregate market value at 08/31/97 of $204,000,425.
(t) Open repurchase agreement. Either party may terminate the agreement upon
demand. Interest rates, par and collateral are redetermined daily.
Collateralized by $196,654,000 U.S. Treasury obligations, 5.50% to 8.75%
due 08/15/00 to 02/28/01 with an aggregate market value at 08/31/97 of
$204,000,926.
(u) Also represents cost for federal income tax purposes.
See Notes to Financial Statements.
5
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
August 31, 1997
<TABLE>
<S> <C>
ASSETS:
Investments, excluding repurchase agreements, at value
(amortized cost) $ 680,962,090
- ------------------------------------------------------------------------
Repurchase agreements 4,594,728,794
- ------------------------------------------------------------------------
Interest receivable 8,635,412
- ------------------------------------------------------------------------
Investment for deferred compensation plan 62,529
- ------------------------------------------------------------------------
Other assets 139,530
- ------------------------------------------------------------------------
Total assets 5,284,528,355
- ------------------------------------------------------------------------
LIABILITIES:
Payables for:
Dividends 22,897,610
- ------------------------------------------------------------------------
Deferred compensation 62,529
- ------------------------------------------------------------------------
Accrued advisory fees 248,343
- ------------------------------------------------------------------------
Accrued distribution fees 358,768
- ------------------------------------------------------------------------
Accrued transfer agent fees 48,453
- ------------------------------------------------------------------------
Accrued trustees' fees 5,067
- ------------------------------------------------------------------------
Accrued administrative services fees 8,834
- ------------------------------------------------------------------------
Accrued operating expenses 110,246
- ------------------------------------------------------------------------
Total liabilities 23,739,850
- ------------------------------------------------------------------------
NET ASSETS $5,260,788,505
========================================================================
NET ASSETS:
Institutional Class $3,408,009,911
========================================================================
Private Investment Class $ 463,440,813
========================================================================
Personal Investment Class $ 322,971,027
========================================================================
Cash Management Class $ 829,243,407
========================================================================
Resource Class $ 237,123,347
========================================================================
SHARES OF BENEFICIAL INTEREST, $.01 PAR VALUE PER SHARE:
Institutional Class 3,407,493,098
========================================================================
Private Investment Class 463,369,076
========================================================================
Personal Investment Class 322,922,450
========================================================================
Cash Management Class 829,111,747
========================================================================
Resource Class 237,087,410
========================================================================
NET ASSET VALUE PER SHARE:
Net asset value, offering and redemption price per share $ 1.00
========================================================================
</TABLE>
See Notes to Financial Statements.
6
<PAGE>
STATEMENT OF OPERATIONS
For the year ended August 31, 1997
<TABLE>
<S> <C>
INVESTMENT INCOME:
Interest income $244,075,766
- -------------------------------------------------------------------
EXPENSES:
Advisory fees 2,666,379
- -------------------------------------------------------------------
Custodian fees 280,405
- -------------------------------------------------------------------
Administrative services fees 99,273
- -------------------------------------------------------------------
Trustees' fees and expenses 32,668
- -------------------------------------------------------------------
Transfer agent fees 414,190
- -------------------------------------------------------------------
Distribution fees (Note 2) 4,984,471
- -------------------------------------------------------------------
Other 480,366
- -------------------------------------------------------------------
Total expenses 8,957,752
- -------------------------------------------------------------------
Less: Fee waivers and expense reimbursements (1,661,719)
- -------------------------------------------------------------------
Net expenses 7,296,033
- -------------------------------------------------------------------
Net investment income 236,779,733
- -------------------------------------------------------------------
Net realized gain on sales of investments 215,978
- -------------------------------------------------------------------
Net increase in net assets resulting from operations $236,995,711
===================================================================
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
For the years ended August 31, 1997 and 1996
<TABLE>
<CAPTION>
1997 1996
-------------- --------------
<S> <C> <C>
OPERATIONS:
Net investment income $ 236,779,733 $ 193,348,214
- -----------------------------------------------------------------------------
Net realized gain on sales of investments 215,978 490,127
- -----------------------------------------------------------------------------
Net increase in net assets resulting from
operations 236,995,711 193,838,341
- -----------------------------------------------------------------------------
Distributions to shareholders from net
investment income:
Institutional Class (153,610,717) (135,680,200)
- -----------------------------------------------------------------------------
Private Investment Class (20,120,440) (20,937,989)
- -----------------------------------------------------------------------------
Personal Investment Class (11,733,992) (6,998,307)
- -----------------------------------------------------------------------------
Cash Management Class (41,058,376) (28,729,956)
- -----------------------------------------------------------------------------
Resource Class (10,256,208) (1,001,762)
- -----------------------------------------------------------------------------
Distributions to shareholders from net
realized gains (59,575) --
- -----------------------------------------------------------------------------
Share transactions-net 1,556,740,962 443,432,341
- -----------------------------------------------------------------------------
Net increase in net assets 1,556,897,365 443,922,468
- -----------------------------------------------------------------------------
NET ASSETS:
Beginning of period 3,703,891,140 3,259,968,672
- -----------------------------------------------------------------------------
End of period $5,260,788,505 $3,703,891,140
=============================================================================
NET ASSETS CONSIST OF:
Shares of beneficial interest $5,259,983,781 $3,703,242,819
- -----------------------------------------------------------------------------
Undistributed net realized gain on sales of
investments 804,724 648,321
- -----------------------------------------------------------------------------
$5,260,788,505 $3,703,891,140
=============================================================================
</TABLE>
See Notes to Financial Statements.
7
<PAGE>
NOTES TO FINANCIAL STATEMENTS
August 31, 1997
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES
Short-Term Investments Trust (the "Fund") is registered under the Investment
Company Act of 1940, as amended, as an open-end series, diversified management
investment company. The Fund is organized as a Delaware business trust
consisting of two different portfolios, each of which offers separate series of
shares: the Treasury Portfolio and the Treasury TaxAdvantage Portfolio.
Information presented in these financial statements pertains only to the
Treasury Portfolio (the "Portfolio"), with assets, liabilities and operations
of each portfolio being accounted for separately. The Portfolio consists of
five different classes of shares: the Institutional Class, the Private
Investment Class, the Personal Investment Class, the Cash Management Class and
the Resource Class. Matters affecting each class are voted on exclusively by
the shareholders of each class. The Portfolio is a money market fund whose
investment objective is the maximization of current income to the extent
consistent with the preservation of capital and the maintenance of liquidity.
The following is a summary of significant accounting policies followed by the
Portfolio in the preparation of its financial statements. The preparation of
financial statements in conformity with generally accepted accounting
principles requires management to make estimates and assumptions that affect
the reported amounts of assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
A. Security Valuations - The Portfolio invests only in securities which have
maturities of 397 days or less. The securities are valued on the basis of
amortized cost which approximates market value. This method values a
security at its cost on the date of purchase and thereafter assumes a
constant amortization to maturity of any discount or premium.
B. Securities Transactions, Investment Income and Distributions - Securities
transactions are accounted for on a trade date basis. Realized gains or
losses are computed on the basis of specific identification of the
securities sold. Interest income, adjusted for amortization of premiums and
discounts on investments, is accrued daily. Dividends to shareholders are
declared daily and are paid on the first business day of the following
month.
C. Federal Income Taxes - The Portfolio intends to comply with the requirements
of the Internal Revenue Code necessary to qualify as a regulated investment
company and, as such, will not be subject to federal income taxes on
otherwise taxable income (including net realized capital gains) which is
distributed to shareholders. Therefore, no provision for federal income
taxes is recorded in the financial statements.
D. Expenses - Distribution and transfer agency expenses directly attributable
to a class of shares are charged to that class' operations. All other
expenses are allocated among the classes.
NOTE 2-ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES
The Fund has entered into a master investment advisory agreement with A I M
Advisors, Inc. ("AIM"). Under the terms of the master advisory agreement, AIM
receives a monthly fee with respect to the Portfolio calculated by applying a
monthly rate, based upon the following annual rates, to the average daily net
assets of the Portfolio:
<TABLE>
<CAPTION>
Net Assets RATE
- ----------------------------------------
<S> <C>
First $300 million 0.15%
- ----------------------------------------
Over $300 million to $1.5 billion 0.06%
- ----------------------------------------
Over $1.5 billion 0.05%
- ----------------------------------------
</TABLE>
During the year ended August 31, 1997, AIM voluntarily reimbursed expenses of
$24,200.
8
<PAGE>
The Portfolio, pursuant to a master administrative services agreement with
AIM, has agreed to reimburse AIM for certain costs incurred in providing
accounting services to the Portfolio. During the year ended August 31, 1997,
the Fund reimbursed AIM $99,273 for such services.
The Portfolio, pursuant to a transfer agency and service agreement, has agreed
to pay A I M Institutional Fund Services, Inc. ("AIFS") a fee for providing
transfer agent and shareholder services to the Portfolio. During the year ended
August 31, 1997, the Portfolio paid AIFS $414,190 for such services. On
September 19, 1997, the Board of Trustees of the Fund approved the appointment
of A I M Fund Services, Inc. ("AFS") as transfer agent of the Fund to be
effective in late 1997 or early 1998.
Under the terms of a master distribution agreement between Fund Management
Company ("FMC") and the Fund, FMC acts as the exclusive distributor of the
Fund's shares. The Fund has adopted a master distribution plan (the "Plan")
pursuant to Rule 12b-1 under the 1940 Act with respect to the Private
Investment Class, the Personal Investment Class, the Cash Management Class and
the Resource Class of the Portfolio. The Plan provides that the Private
Investment Class, the Personal Investment Class, the Cash Management Class and
the Resource Class pay up to a 0.50%, 0.75%, 0.10%, and 0.20%, respectively,
maximum annual rate of the average daily net assets attributable to such class.
Of this amount, the Fund may pay an asset-based sales charge to FMC and the
Fund may pay a service fee of (a) 0.25% of the average daily net assets of each
of the Private Investment Class and the Personal Investment Class, (b) 0.10% of
the average daily net assets of the Cash Management Class and (c) 0.20% of the
average daily net assets of the Resource Class, to selected banks, broker-
dealers and other financial institutions who offer continuing personal
shareholder services to their customers who purchase and own shares of the
Private Investment Class, the Personal Investment Class, the Cash Management
Class or the Resource Class. Any amounts not paid as a service fee under such
Plan would constitute an asset-based sales charge. The plan also imposes a cap
on the total amount of sales charges, including asset-based sales charges, that
may be paid by the Portfolio with respect to each class. During the year ended
August 31, 1997, the Private Investment Class, the Personal Investment Class,
the Cash Management Class and the Resource Class paid $1,195,700, $1,210,290,
$625,057, and $315,905, respectively, as compensation under the Plan. FMC
waived fees of $1,637,519 for the same period. Certain officers and trustees of
the Trust are officers of AIM, FMC, AIFS and AFS.
During the year ended August 31, 1997, the Portfolio paid legal fees of
$13,565 for services rendered by Kramer, Levin, Naftalis & Frankel as counsel
to the Board of Trustees. A member of that firm is a trustee of the Fund.
NOTE 3-TRUSTEES' FEES
Trustees' fees represent remuneration paid or accrued to each trustee who is
not an "interested person" of AIM. The Fund may invest trustees' fees, if so
elected by a trustee, in mutual fund shares in accordance with a deferred
compensation plan.
9
<PAGE>
NOTE 4-SHARE INFORMATION
Changes in shares outstanding during the years ended August 31, 1997 and 1996
were as follows:
<TABLE>
<CAPTION>
1997 1996
--------------------------------- ---------------------------------
SHARES AMOUNT SHARES AMOUNT
--------------- ---------------- --------------- ----------------
<S> <C> <C> <C> <C>
Sold:
Institutional Class 15,820,439,672 $ 15,820,439,672 15,527,980,642 $ 15,527,980,642
- ---------------------------------------------------------------------------------------------
Private Investment
Class 2,377,066,232 2,377,066,232 2,472,141,697 2,472,141,697
- ---------------------------------------------------------------------------------------------
Personal Investment
Class 2,585,293,225 2,585,293,225 1,088,591,830 1,088,591,830
- ---------------------------------------------------------------------------------------------
Cash Management Class 4,354,698,981 4,354,698,981 4,232,083,227 4,232,083,227
- ---------------------------------------------------------------------------------------------
Resource Class* 2,558,140,941 2,558,140,941 157,958,663 157,958,663
- ---------------------------------------------------------------------------------------------
Issued as reinvestment
of dividends:
Institutional Class 15,531,436 15,531,436 9,763,491 9,763,491
- ---------------------------------------------------------------------------------------------
Private Investment
Class 3,858,592 3,858,592 3,211,766 3,211,766
- ---------------------------------------------------------------------------------------------
Personal Investment
Class 9,897,559 9,897,559 4,455,140 4,455,140
- ---------------------------------------------------------------------------------------------
Cash Management Class 12,944,226 12,944,226 8,200,664 8,200,664
- ---------------------------------------------------------------------------------------------
Resource Class* 9,274,277 9,274,277 789,507 789,507
- ---------------------------------------------------------------------------------------------
Reacquired:
Institutional Class (14,763,510,184) (14,763,510,184) (15,872,219,385) (15,872,219,385)
- ---------------------------------------------------------------------------------------------
Private Investment
Class (2,270,031,466) (2,270,031,466) (2,517,444,015) (2,517,444,015)
- ---------------------------------------------------------------------------------------------
Personal Investment
Class (2,465,181,087) (2,465,181,087) (1,014,656,105) (1,014,656,105)
- ---------------------------------------------------------------------------------------------
Cash Management Class (4,328,020,236) (4,328,020,236) (3,532,010,008) (3,532,010,008)
- ---------------------------------------------------------------------------------------------
Resource Class* (2,363,661,206) (2,363,661,206) (125,414,773) (125,414,773)
- ---------------------------------------------------------------------------------------------
Net increase 1,556,740,962 $ 1,556,740,962 443,432,341 $ 443,432,341
=============================================================================================
</TABLE>
* The Resource Class commenced operations on March 12, 1996.
NOTE 5-FINANCIAL HIGHLIGHTS
Shown below are the financial highlights for a share outstanding of the Private
Investment Class during each of the years in the five-year period ended August
31, 1997.
<TABLE>
<CAPTION>
1997 1996 1995 1994 1993
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Net asset value,
beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ------------------------- -------- -------- -------- -------- --------
Income from investment
operations:
Net investment income 0.05 0.05 0.05 0.03 0.03
- ------------------------- -------- -------- -------- -------- --------
Less distributions:
Dividends from net
investment income (0.05) (0.05) (0.05) (0.03) (0.03)
- ------------------------- -------- -------- -------- -------- --------
Net asset value, end of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
========================= ======== ======== ======== ======== ========
Total return 5.16% 5.25% 5.34% 3.22% 2.91%
========================= ======== ======== ======== ======== ========
Ratios/supplemental data:
Net assets, end of period
(000s omitted) $463,441 $352,537 $394,585 $412,716 $204,281
========================= ======== ======== ======== ======== ========
Ratio of expenses to
average net assets(a) 0.39%(b) 0.39% 0.40% 0.38% 0.38%
========================= ======== ======== ======== ======== ========
Ratio of net investment
income to average net
assets(c) 5.05%(b) 5.14% 5.23% 3.26% 2.81%
========================= ======== ======== ======== ======== ========
</TABLE>
(a) After fee waivers and/or expense reimbursements. Ratios of expenses to
average net assets prior to fee waivers and/or expense reimbursements were
0.59%, 0.59%, 0.60%, 0.60%, and 0.67% for the periods 1997-1993,
respectively.
(b) Ratios are based on average net assets of $398,566,784.
(c) After fee waivers and/or expense reimbursements. Ratios of net investment
income to average net assets prior to fee waivers and/or expense
reimbursements were 4.85%, 4.94%, 5.03%, 3.05%, and 2.52% for the periods
1997-1993, respectively.
10
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Board of Trustees and Shareholders
Short-Term Investments Trust:
We have audited the accompanying statement of assets and liabilities of the
Treasury Portfolio (a series portfolio of Short-Term Investments Trust),
including the schedule of investments, as of August 31, 1997, and the related
statement of operations for the year then ended, the statements of changes in
net assets for each of the years in the two-year period then ended, and the
financial highlights for each of the years in the five-year period then ended.
These financial statements and financial highlights are the responsibility of
the Fund's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
August 31, 1997 by correspondence with the custodian. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of the
Treasury Portfolio as of August 31, 1997, the results of its operations for the
year then ended, the changes in its net assets for each of the years in the
two-year period then ended, and the financial highlights for each of the years
in the five-year period then ended, in conformity with generally accepted
accounting principles.
KPMG Peat Marwick LLP
Houston, Texas
October 3, 1997
- --------------------------------------------------------------------------------
SUPPLEMENTAL PROXY INFORMATION -- SHAREHOLDER MEETING
- --------------------------------------------------------------------------------
The Annual Meeting of Shareholders of the Fund was held on February 7, 1997.
The meeting was held for the following purposes:
(1) To elect trustees as follows: Charles T. Bauer, Bruce L. Crockett, Owen
Daly II, Carl Frischling, Robert H. Graham, John F. Kroeger, Lewis F.
Pennock, Ian W. Robinson, and Louis S. Sklar.
(2) To approve a new Investment Advisory Agreement between the Fund and AIM.
(3) To approve the elimination of the fundamental investment policy prohibiting
or restricting investments in other investment companies and/or the
amendment of certain related fundamental investment policies.
(4) Ratification of KPMG Peat Marwick LLP as independent accountants for the
Fund's fiscal year ending August 31, 1997.
The following votes were cast with respect to each item:
<TABLE>
<CAPTION>
VOTES WITHHOLD/
TRUSTEE/MATTER VOTES FOR AGAINST ABSTENTIONS
-------------- ------------- --------- -----------
<C> <S> <C> <C> <C>
(1) Charles T. Bauer..................... 3,503,994,903 N/A N/A
Bruce L. Crockett.................... 3,503,994,903 N/A N/A
Owen Daly II......................... 3,503,994,903 N/A N/A
Carl Frischling...................... 3,503,994,903 N/A N/A
Robert H. Graham..................... 3,503,994,903 N/A N/A
John F. Kroeger...................... 3,503,994,903 N/A N/A
Lewis F. Pennock..................... 3,503,994,903 N/A N/A
Ian W. Robinson...................... 3,503,994,903 N/A N/A
Louis S. Sklar....................... 3,503,994,903 N/A N/A
(2) Approval of new Investment Advisory
Agreement (Portfolio only)........... 3,241,894,841 1,250,000 9,500
(3) Elimination of policy restricting in-
vestments in other investment compa-
nies (Portfolio only)................ 3,219,075,791 1,250,000 71,329
(4) KPMG Peat Marwick LLP................ 3,503,994,903 N/A N/A
</TABLE>
11
<PAGE>
<TABLE>
<S> <C>
TRUSTEES
Charles T. Bauer Robert H. Graham Short-Term
Bruce L. Crockett John F. Kroeger Investments Trust
Owen Daly II Lewis F. Pennock (STIT)
Jack Fields Ian W. Robinson
Carl Frischling Louis S. Sklar
OFFICERS
Charles T. Bauer Chairman
Robert H. Graham President
John J. Arthur Sr. Vice President & Treasurer
Gary T. Crum Sr. Vice President Treasury Portfolio
Carol F. Relihan Sr. Vice President & Secretary ----------------------------------------
Dana R. Sutton Vice President & Assistant Treasurer Private ANNUAL
Melville B. Cox Vice President Investment REPORT
Karen Dunn Kelley Vice President Class
J. Abbott Sprague Vice President
P. Michelle Grace Assistant Secretary
Nancy L. Martin Assistant Secretary AUGUST 31, 1997
Ofelia M. Mayo Assistant Secretary
Kathleen J. Pflueger Assistant Secretary
Samuel D. Sirko Assistant Secretary
Stephen I. Winer Assistant Secretary
Mary J. Benson Assistant Treasurer
INVESTMENT ADVISOR
A I M Advisors, Inc.
11 Greenway Plaza, Suite 100
Houston, TX 77046
(800) 347-1919
DISTRIBUTOR
Fund Management Company
11 Greenway Plaza, Suite 100
Houston, TX 77046
(800) 659-1005
CUSTODIAN
The Bank of New York
90 Washington Street, 11th Floor
New York, NY 10286
LEGAL COUNSEL TO FUND
Ballard Spahr Andrews & Ingersoll
1735 Market Street, 51st Floor
Philadelphia, PA 19103-7599
LEGAL COUNSEL TO TRUSTEES
Kramer, Levin, Naftalis & Frankel
919 Third Avenue
New York, NY 10022
TRANSFER AGENT
A I M Institutional Fund Services, Inc.
11 Greenway Plaza, Suite 100
Houston, TX 77046-1173
AUDITORS
KPMG Peat Marwick LLP
700 Louisiana
NationsBank Building
Houston, TX 77002
This report may be distributed only to current shareholders or [LOGO APPEARS HERE]
to persons who have received a current prospectus. FUND MANAGEMENT COMPANY
</TABLE>
