<PAGE>
<TABLE>
<CAPTION>
<S> <C>
[AIM LOGO APPEARS Dear Shareholder:
HERE]
The Cash Reserve Portfolio of Tax-Free Investments Co. (TFIC) benefited from stable
[PHOTO of economic conditions during the six-month period ended September 30, 1995.
Charles T. Bauer, For most of the reporting period, interest rates remained unchanged, with
LETTER Chairman of the federal funds rate targeted at 6.00%. When economic growth slowed
the Board of during the second quarter of 1995 to an annual rate of just 1.3%, the Federal
TO OUR the Fund, Reserve Board turned recession fighter, easing short-term interest rates
APPEARS HERE] by 0.25% at its July meeting.
SHAREHOLDERS In September testimony before Congress, Federal Reserve Chairman Alan Greenspan
deemed this policy successful and offered the following optimistic assessment of the economy: "The
November 6, 1995 available statistical indicators for the current quarter are consistent with a firmer pace of economic
growth."
YOUR INVESTMENT PORTFOLIO
During the reporting period, the TFIC Cash Reserve Portfolio maintained its strict investment discipline. The
Portfolio continues to hold a AAAm credit quality rating, the highest given by Standard & Poor's Corporation, a
widely known credit rating agency. The AAAm rating is historical and is based on annual analysis of the
Portfolio's credit quality, composition, management, and weekly portfolio review. As with any money market fund,
an investment in the Cash Reserve Portfolio is neither insured nor guaranteed by the U.S. government, and there
can be no assurance the Fund will be able to maintain a stable net asset value of $1.00 per share.
The 1994 bankruptcy of Orange County, California, has had little impact on short-term tax-free money markets,
as issues continue to trade in their normal ranges. At this time, TFIC Cash Reserve Portfolio has chosen not to
invest in the California market. The Fund invests only in securities rated "First Tier" as defined in Rule 2a-7
of the the Investment Company Act of 1940.
Given stable interest rates, portfolio managers lengthened the weighted average maturity of holdings. During
April, the first month of the reporting period, the portfolio's weighted maturity averaged 24.2 days. That
figure was extended to 50.1 days as of September 30. For the Institutional Cash Reserve Shares, this strategy
produced a 30-day average yield in September of 3.67%, out-performing similar funds tracked by IBC/Donoghue's
Money Fund Averages(TM), as shown in the chart on the following page. At the close of the reporting period, net
assets of the Institutional Cash Reserve Shares of Cash Reserve Portfolio were $1.024 billion, up from $1.01
billion six months earlier.
OUTLOOK FOR THE FUTURE
As the reporting period ended, inflation seemed firmly under control and economic signals were generally
encouraging. The Federal Reserve Board prepared a basically upbeat economic review in advance of its September
26 meeting, where it left the federal funds rate unchanged, saying that "sustained expansion at a moderate pace
was seen as the most likely course for the economy." Such a relatively optimistic outlook allows the Cash
Reserve Portfolio to maintain a relatively long weighted average maturity that seeks to maximize available yield
without sacrificing liquidity or exposing the Fund to additional net asset value risk.
We are pleased to send you this report concerning your Fund. AIM is committed to customer service and a money
market investment philosophy that seeks to maximize current income while preserving capital and maintaining
liquidity. As ever, we are ready to respond to your comments and to any questions. Please contact one of our
representatives at 800-659-1005.
Respectfully submitted,
/s/ CHARLES T. BAUER
Charles T. Bauer
Chairman
</TABLE>
1
<PAGE>
AVERAGE MONTHLY YIELD COMPARISON(1)
TFIC INSTITUTIONAL CASH RESERVE SHARES
vs. IBC/Donoghue's Tax-Free Money Fund Averages(TM) (Institutions Only)
vs. IBC/Donoghue's All Tax-Free Money Fund Averages(TM)
<TABLE>
<CAPTION>
TFIC Institutional Cash IBC Donoghue's Tax-Free IBC/Donoghue's
Reserve Shares(1) Money Funds Averages(TM)(2) All-Tax-Free Money Fund Averages (TM)(3)
<S> <C> <C> <C>
4/95 3.95% Yield 3.82% Yield 3.59% Yield
5/95 4.14 3.95 3.74
6/95 3.63 3.54 3.32
7/95 3.41 3.33 3.10
8/95 3.59 3.44 3.22
9/95 3.67 3.51 3.28
</TABLE>
(1) Yields shown above are net of expenses.
(2) Average yield for all Tax-Free Money Funds (Institutions Only) category
compiled by IBC Money Market Insight(TM).
(3) Average yield for all Tax-Free Money Funds category compiled by IBC Money
Market Insight(TM).
TFIC Institutional Cash Reserves Shares' 7-day SEC yield as of
September 30, 1994 was 3.83%.
The monthly yields shown represent past performance. Future yields will
fluctuate. Yields are average 30-day yields for the month-ends shown.
<PAGE>
SCHEDULE OF INVESTMENTS
September 30, 1995
(Unaudited)
<TABLE>
<CAPTION>
RATING(a) PAR
S&P MOODY'S (000) VALUE
<S> <C> <C> <C> <C>
ALABAMA - 2.89%
Birmingham (City of); General
Obligation Series 1994-A Warrants
4.40% 06/01/18(b)(c) A-1+ VMIG-1 $ 9,000 $ 9,000,000
- -------------------------------------------------------------------------------
BMC Special Care Facilities Financing
Authority; Variable Rate Hospital
Series 1985 C RB
4.20% 12/01/30(b)(c) A-1 Aaa 2,175 2,175,000
- -------------------------------------------------------------------------------
Industrial Development Board of the
City of McIntosh (CIBA-GEIGY Corp.
Project); Variable Rate Series 1985 A
PCR
4.40% 12/01/03(b)(c) A-1+ -- 1,500 1,500,000
- -------------------------------------------------------------------------------
Jefferson (County of); Sewer Series
1995-A Revenue Warrants
4.45% 09/01/25(b)(c) A-1+ VMIG-1 15,000 15,000,000
- -------------------------------------------------------------------------------
Marshall (County of); Special
Obligation School Refunding Series
1994 Warrants
4.50% 02/01/12(b)(c) A-1+ -- 2,925 2,925,000
- -------------------------------------------------------------------------------
30,600,000
- -------------------------------------------------------------------------------
ALASKA - 3.10%
Alaska Housing Finance Corp.; General
Mortgage Series 1991 C RB
4.35% 06/01/26(b) A-1+ VMIG-1 32,800 32,800,000
- -------------------------------------------------------------------------------
ARIZONA - 1.45%
Chandler (City of) Industrial
Development Authority (Southpark
Apartment Project); Multifamily
Housing Series 1989 RB
4.35% 12/01/02(b)(c) A-1+ -- 3,775 3,775,000
- -------------------------------------------------------------------------------
Maricopa County Pollution Control
Corp. (Arizona Public Service Co.
Palo Verde Project); Refunding PCR
4.85% Series 1994 C 05/01/09(b)(c) A-1+ P-1 1,000 1,000,000
- -------------------------------------------------------------------------------
4.45% Series 1994 E 05/01/29(b)(c) A-1 P-1 2,900 2,900,000
- -------------------------------------------------------------------------------
Phoenix (City of); Refunding Series
1992 B GO
5.05% 07/01/96 AA+ Aa 1,035 1,045,151
- -------------------------------------------------------------------------------
Phoenix (City of) Industrial
Development Authority (Southwest
Villages Project); Variable Rate
Demand Multifamily Housing Series
1985 A RB
4.35% 12/01/06(b)(c) A-1+ -- 4,400 4,400,000
- -------------------------------------------------------------------------------
Tempe (City of) Industrial Development
Authority (Elliot's Crossing
Apartment Project); Variable Rate
Demand Multifamily Housing Series
1985 RB
4.35% 10/01/08(b)(c) A-1+ -- 2,250 2,250,000
- -------------------------------------------------------------------------------
15,370,151
- -------------------------------------------------------------------------------
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
RATING(a) PAR
S&P MOODY'S (000) VALUE
<S> <C> <C> <C> <C>
ARKANSAS - 1.50%
Arkansas Hospital Equipment Finance
Authority; Equipment Lease Series
1985 RB
4.25% 12/01/05(b)(c) A-1+ -- $ 1,800 $ 1,800,000
- -------------------------------------------------------------------------------
Fayetteville (City of) Public
Facilities Board (Charter Vista
Hospital); Adjustable Refunding
Series 1987 RB
4.60% 03/01/07(b)(c) -- VMIG-1 1,991 1,991,000
- -------------------------------------------------------------------------------
Little Rock (City of) Health
Facilities Board (Southwest
Hospital); Hospital Series 1988 RB
4.05% 10/01/18(b)(c) A-1+ Aaa 9,100 9,100,000
- -------------------------------------------------------------------------------
University of Arkansas Board of
Trustees (UAMS Campus); Various
Facility Series 1994 RB
4.35% 12/01/19(b)(c) -- VMIG-1 3,000 3,000,000
- -------------------------------------------------------------------------------
15,891,000
- -------------------------------------------------------------------------------
COLORADO - 2.55%
Colorado Health Facilities Authority
(Boulder Community Hospital Project);
Variable Rate Demand Hospital RB
4.40% Series 1989 B 10/01/14(b)(c) A-1+ VMIG-1 1,600 1,600,000
- -------------------------------------------------------------------------------
4.40% Series 1989 C 10/01/14(b)(c) A-1+ VMIG-1 1,490 1,490,000
- -------------------------------------------------------------------------------
Colorado Health Facilities Authority
(North Colorado Medical Center);
Variable Rate Demand Hospital Series
1990 RB
4.40% 05/15/20(b)(c) A-1+ VMIG-1 2,500 2,500,000
- -------------------------------------------------------------------------------
Colorado Health Facilities Finance
Authority (Sisters of Charity Health
Facility); RB
4.35% Series 1992 B 05/15/22(b)(d) A-1+ VMIG-1 1,000 1,000,000
- -------------------------------------------------------------------------------
4.35% Series 1992 C 05/15/22(b)(d) A-1+ VMIG-1 4,400 4,400,000
- -------------------------------------------------------------------------------
Denver (City and County of) (Loretto
Heights Apartments Project);
Multifamily Housing Series 1985 RB
4.25% 12/01/98(b)(c) A-1 -- 8,300 8,300,000
- -------------------------------------------------------------------------------
Pitkin (County of) (Centennial-Aspen
Project); Multifamily Housing Series
1984 RB
4.35% 04/01/07(b)(c) -- VMIG-1 7,700 7,700,000
- -------------------------------------------------------------------------------
26,990,000
- -------------------------------------------------------------------------------
DISTRICT OF COLUMBIA - 1.97%
District of Columbia (American
Association for the Advancement of
Science); Series 1995 RB
4.45% 10/01/22(b)(c) A-1 VMIG-1 14,100 14,100,000
- -------------------------------------------------------------------------------
District of Columbia (The American
University Issue); Variable Rate
Weekly Demand Series 1985 RB
4.35% 10/01/15(b)(c) -- VMIG-1 3,800 3,800,000
- -------------------------------------------------------------------------------
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION>
RATING(a) PAR
S&P MOODY'S (000) VALUE
<S> <C> <C> <C> <C>
District of Columbia - (continued)
District of Columbia (Columbia
Hospital For Women); Variable Rate
Demand Hospital Series 1988 A RB
4.60% 07/01/20(b)(c) -- VMIG-1 $ 2,900 $ 2,900,000
- ------------------------------------------------------------------------------
20,800,000
- ------------------------------------------------------------------------------
FLORIDA - 5.54%
Eagle Tax-Exempt Trust; Series
950901 A Certificates of
Participation
4.49% 06/01/21(b)(d)(e) A-1+c -- 12,700 12,700,000
- ------------------------------------------------------------------------------
Florida Local Government Finance
Commission; Pooled Series A
Commercial Paper Notes
3.85% 10/31/95(c) A-1 P-1 4,546 4,546,000
- ------------------------------------------------------------------------------
3.85% 01/12/96(c) A-1 P-1 2,500 2,500,000
- ------------------------------------------------------------------------------
Florida Municipal Power Agency;
Initial Pooled Loan Program
Series A RB
4.00% 10/20/95(c) A-1 P-1 3,815 3,815,000
- ------------------------------------------------------------------------------
Hillsborough County Industrial
Development Authority (Tampa
Electric Co. Project); Refunding
Series 1990 PCR
4.50% 09/01/25(b)(d) AA- VMIG-1 1,900 1,900,000
- ------------------------------------------------------------------------------
Jacksonville (City of); Series A
Commercial Paper Notes
3.70% 10/10/95 A-1 P-1 7,300 7,300,000
- ------------------------------------------------------------------------------
Jacksonville (City of) Health
Facility Authority (Baptist Health
Properties Project); Series 1990 RB
4.65% 06/01/20(b)(c) A-1 -- 2,700 2,700,000
- ------------------------------------------------------------------------------
Jacksonville (City of) Health
Facility Authority (Baptist Medical
Center); Hospital RB
4.60% 06/01/08(b)(c) A-1+ VMIG-1 3,500 3,500,000
- ------------------------------------------------------------------------------
Lee (County of) Industrial
Development Authority (Charter
Glade Hospital Project); Adjustable
Refunding Hospital Series 1988 RB
4.60% 08/01/07(b)(c) -- Aa2 4,775 4,775,000
- ------------------------------------------------------------------------------
Putnam County Development Authority
(Seminole Electric Cooperative,
Inc. Project); National Rural
Utilities Cooperative Finance Corp.
Guaranteed Floating/Fixed Rate PCR
4.35% Pooled Series 1984H-1
03/15/14(b)(c) A-1+ P-1 4,065 4,065,000
- ------------------------------------------------------------------------------
4.35% Pooled Series 1984H-2
03/15/14(b)(c) A-1+ P-1 1,700 1,700,000
- ------------------------------------------------------------------------------
3.40% Series 1984D 12/15/95(c)(f) A-1+ Aa3 4,100 4,100,000
- ------------------------------------------------------------------------------
University Athletic Association Inc.
(University of Florida Stadium
Project); Capital Improvement
Adjustable Series 1990 RB
4.50% 02/01/20(b)(c) -- VMIG-1 5,000 5,000,000
- ------------------------------------------------------------------------------
58,601,000
- ------------------------------------------------------------------------------
</TABLE>
5
<PAGE>
<TABLE>
<CAPTION>
RATING(a) PAR
S&P MOODY'S (000) VALUE
<S> <C> <C> <C> <C>
GEORGIA - 1.91%
Decatur County Bianbridge Industrial
Development Authority (Kaiser
Agriculture Chemical Inc. Project);
Series 1985 IDR
4.40% 12/01/02(b)(c) A-1+ -- $ 3,500 $ 3,500,000
- -------------------------------------------------------------------------------
Development Authority of DeKalb
County (Radiation Sterilizers, Inc.
Project); Variable Rate Demand
Series 1985 IDR
3.85% 03/01/05(b)(c) A-1 -- 4,600 4,600,000
- -------------------------------------------------------------------------------
Housing Authority of Clayton County
(Kimberly Forest Apartments
Project); Multifamily Housing
Refunding Series 1990 B RB
4.30% 01/01/21(b)(c) A-1+ VMIG-1 2,055 2,055,000
- -------------------------------------------------------------------------------
Housing Authority of Cobb County
(Terrell Mill II Associates, Ltd.
Project); Multifamily Housing
Refunding Series 1993 RB
4.55% 12/01/05(b)(c) A-1 -- 10,000 10,000,000
- -------------------------------------------------------------------------------
20,155,000
- -------------------------------------------------------------------------------
IDAHO - 0.95%
Idaho (State of); Series 1995 TAN
4.50% 06/27/96 SP-1+ MIG-1 10,000 10,049,765
- -------------------------------------------------------------------------------
ILLINOIS - 6.61%
Burbank (City of) (Service
Merchandise Co. Inc. Project);
Floating Rate Monthly Demand
Industrial Building Series 1984 RB
3.85% 09/15/24(b)(c) A-1+ -- 3,600 3,600,000
- -------------------------------------------------------------------------------
Cook (County of) Community College;
Lease CTFS Series C RB
6.90% 12/01/95(c) AAA Aaa 3,775 3,791,194
- -------------------------------------------------------------------------------
Cook (County of) (Catholic Charities
Housing Development Corp. Project);
Adjustable Demand Series 1988 A-1 RB
4.35% 01/01/28(b)(c) -- VMIG-1 1,700 1,700,000
- -------------------------------------------------------------------------------
East Peoria (City of) (Radnor/East
Peoria Partnership Project);
Multifamily Housing Series 1983 RB
4.775% 06/01/08(b)(c) -- Aa3 6,345 6,345,000
- -------------------------------------------------------------------------------
Illinois (State of); Series 1986 GO
5.50% 12/01/95 AA- A1 2,000 2,005,629
- -------------------------------------------------------------------------------
Illinois (State of); Series August
1995 RAN
4.50% 05/10/96 SP-1+ MIG-1 5,000 5,020,660
- -------------------------------------------------------------------------------
Illinois (State of) Metropolitan Fair
and Exposition Authority; Series
1996 RB
8.00% 06/01/96(f)(g) AAA -- 1,000 1,047,474
- -------------------------------------------------------------------------------
Illinois Development Finance
Authority (Institutional Gas
Technology Project); Variable Rate
Series 1993 RB
4.45% 09/01/18(b)(c) A-1+ -- 2,700 2,700,000
- -------------------------------------------------------------------------------
</TABLE>
6
<PAGE>
<TABLE>
<CAPTION>
RATING(a) PAR
S&P MOODY'S (000) VALUE
<S> <C> <C> <C> <C>
Illinois - (continued)
Illinois Development Finance Authority
(Jewish Charities Revenue Anticipation
Note Program); Variable Rate Demand
Series 1995-1996 A RAN
4.45% 06/28/96(b)(c) A-1+ -- $ 3,500 $ 3,500,000
- -------------------------------------------------------------------------------
Illinois Development Finance Authority
(Marriott Corp. Deerfield Project);
Adjustable Tender Series 1984 IDR
4.40% 11/01/14(b)(c) -- P-1 1,300 1,300,000
- -------------------------------------------------------------------------------
Illinois Development Finance Authority
(Marriott Corp. Oakbrook Terrace
Project); Adjustable Tender Series 1984
IDR
4.40% 12/01/14(b)(c) -- P-1 2,300 2,300,000
- -------------------------------------------------------------------------------
Illinois Development Finance Authority
(Olin Corp.); Variable Rate Refunding RB
4.55% Series 1993 A 06/01/04(b)(c) A-1+ -- 2,500 2,500,000
- -------------------------------------------------------------------------------
4.55% Series 1993 D 03/01/06(b)(c) A-1+ -- 2,050 2,050,000
- -------------------------------------------------------------------------------
Illinois Educational Facilities Authority
(Aurora University Project);
Variable/Fixed Rate Refunding Series 1989
RB
4.45% 01/01/09(b)(c) A-1+ -- 800 800,000
- -------------------------------------------------------------------------------
Illinois Health Facilities Authority
(Highland Park Hospital); Adjustable Rate
Series 1991 B RB
4.00% 06/01/96(c)(f) A-1+ VMIG-1 8,000 8,000,000
- -------------------------------------------------------------------------------
Illinois Health Facilities Authority
(South Suburban Hospital Project);
Variable Rate Demand Series 1994 RB
4.35% 02/15/14(b)(c) A-1+ -- 12,500 12,500,000
- -------------------------------------------------------------------------------
Marseilles (City of) (Kaiser Agricultural
Chemicals Inc. Project); Variable Rate
Demand Series 1985 IDR
4.40% 01/01/98(b)(c) A-1+ -- 4,650 4,650,000
- -------------------------------------------------------------------------------
University of Illinois (University of
Illinois Natural Gas Purchase Project);
Series 1995 Certificates of Participation
4.30% 04/01/96(c) AAA Aaa 1,085 1,085,892
- -------------------------------------------------------------------------------
Village of Lisle (Four Lakes Project);
Multi-Family Housing
Series 1985 A RB
4.40% 04/01/19(b)(c) A-1 -- 1,400 1,400,000
- -------------------------------------------------------------------------------
Village of Northbrook (Euromarket Designs,
Inc. Project); Variable Rate Demand
Refunding Series 1993 IDR
4.45% 07/01/02(b)(c) A-1+ -- 3,600 3,600,000
- -------------------------------------------------------------------------------
69,895,849
- -------------------------------------------------------------------------------
</TABLE>
7
<PAGE>
<TABLE>
<CAPTION>
RATING(a) PAR
S&P MOODY'S (000) VALUE
<S> <C> <C> <C> <C>
INDIANA - 1.27%
Auburn (City of) (Sealed Power Corp.
Project); Variable Rate Demand
Economic Development Series 1985 RB
3.75% 07/01/10(b)(c) -- VMIG-1 $ 1,200 $ 1,200,000
- -----------------------------------------------------------------------------
Indianapolis (City of); Public
Transportation Series 1995 C Local
Public Improvement Bonds
4.25% 01/11/96 SP-1+ -- 2,675 2,680,483
- -----------------------------------------------------------------------------
Indianapolis (City of) (Jewish
Community Campus Project); Variable
Rate Economic Development RB
4.50% 04/01/05(b)(c) -- VMIG-1 2,600 2,600,000
- -----------------------------------------------------------------------------
Indiana Housing Finance Authority;
Single Family Mortgage
Series 1994 D RB
3.90% 07/01/96(c)(f) -- VMIG-1 3,000 3,000,000
- -----------------------------------------------------------------------------
Jasper (County of) (Northern Indiana
Public Service Co. Project); Variable
Rate Demand Refunding PCR
4.00% Series 1988 C 10/19/95(c)(f) A-1+ VMIG-1 1,000 1,000,000
- -----------------------------------------------------------------------------
4.50% Series 1994 C 04/01/19(b)(c) A-1+ VMIG-1 2,900 2,900,000
- -----------------------------------------------------------------------------
13,380,483
- -----------------------------------------------------------------------------
IOWA - 0.83%
Chariton (City of) (Hy-Vee Food Stores,
Inc. Project); Refunding Series 1984
IDR
3.75% 11/01/04(b)(c) A-1+ -- 1,162 1,162,000
- -----------------------------------------------------------------------------
Iowa (State of) School Corporations;
Series 1995-96 A Warrant Certificates
4.75% 06/28/96(c) SP-1+ MIG-1 7,500 7,548,091
- -----------------------------------------------------------------------------
8,710,091
- -----------------------------------------------------------------------------
KANSAS - 0.12%
Wellington (City of) Electric, Water
and Sewer Utilities System;
Series A RB
9.40% 11/01/95(f)(g) AAA -- 1,200 1,217,052
- -----------------------------------------------------------------------------
KENTUCKY - 2.27%
Jefferson (County of) (Louisville Gas &
Electric Co. Project);
Series 1993 A PCR
3.90% 01/16/96(d)(f) A-1+ VMIG-1 2,000 2,000,000
- -----------------------------------------------------------------------------
Mason County (East Kentucky Power
Cooperative, Inc. Project); National
Rural Utilities Cooperative Finance
Corp. Guaranteed Floating/Fixed Rate
PCR
4.35% Pooled Series 1984 B-1
10/15/14(b)(c) A-1+ Aa3 12,750 12,750,000
- -----------------------------------------------------------------------------
4.35% Pooled Series 1984 B-2
10/15/14(b)(c) A-1+ Aa3 9,300 9,300,000
- -----------------------------------------------------------------------------
24,050,000
- -----------------------------------------------------------------------------
</TABLE>
8
<PAGE>
<TABLE>
<CAPTION>
RATING(a) PAR
S&P MOODY'S (000) VALUE
<S> <C> <C> <C> <C>
LOUISIANA - 4.40%
Ascension (Parish of) (Shell Oil Co.
Project); Refunding
Series 1993 PCR
4.85% 09/01/23(b)(d) A-1+ -- $11,000 $ 11,000,000
- -----------------------------------------------------------------------------
Calcasieu (Parish of) Industrial
Development Authority (Olin Corp.);
Refunding Series 1993 A RB
4.55% 02/01/16(b)(c) A-1+ -- 4,400 4,400,000
- -----------------------------------------------------------------------------
Louisiana Offshore Terminal Authority
(LOOP Inc. Project); Deepwater Port
Refunding RB
4.35% First Stage Series 1991 A
09/01/08(b)(c) A-1+ VMIG-1 13,500 13,500,000
- -----------------------------------------------------------------------------
4.50% Series 1992 A 09/01/08(b)(c) A-1+ VMIG-1 4,000 4,000,000
- -----------------------------------------------------------------------------
Louisiana Public Facilities Authority
(Greenbriar Hospital Inc. Project);
Variable Rate Demand Series 1984 RB
4.40% 11/01/14(b)(c) -- Aa2 2,100 2,100,000
- -----------------------------------------------------------------------------
Louisiana Public Facilities Authority
(Kenner Hotel Limited Partnership
Project); Adjustable Tender Series
1985 IDR
4.60% 12/01/15(b)(c) -- P-1 1,000 1,000,000
- -----------------------------------------------------------------------------
New Orleans International Airport
Aviation Board; Refunding
Series 1995 A RB
4.35% 08/01/15(b)(c) A-1+ VMIG-1 5,000 5,000,000
- -----------------------------------------------------------------------------
Plaquemine Port Harbor & Terminal
Authority (TECO Energy, Inc.); Marine
Terminal Facility Refunding Series
1985 D RB
3.80% 12/06/95(d)(f) -- P-1 5,600 5,600,000
- -----------------------------------------------------------------------------
46,600,000
- -----------------------------------------------------------------------------
MARYLAND - 0.33%
Prince George (County of) Housing
Authority (Laurel-Oxford Associates
Apartment Project); Mortgage Series
1985 RB
4.525% 10/01/07(b)(c) -- VMIG-1 3,500 3,500,000
- -----------------------------------------------------------------------------
MASSACHUSETTS - 0.47%
Commonwealth of Massachusetts; Series
1995 A GO
4.25% 06/12/96 SP-1 MIG-1 5,000 5,012,831
- -----------------------------------------------------------------------------
MICHIGAN - 6.08%
Charter County of Wayne; Downriver
Sewage Disposal System Adjustable Rate
Series 1994 B Limited Tax GO
3.90% 01/24/96(c) A-1 VMIG-1 8,170 8,170,000
- -----------------------------------------------------------------------------
Jackson County Economic Development
Corp. (Sealed Power Corp.); Economic
Development Variable Refunding RB
3.75% 10/01/19(b)(c) -- VMIG-1 1,000 1,000,000
- -----------------------------------------------------------------------------
Michigan Municipal Bond Authority;
Series 1995 B RB
4.50% 07/03/96 SP-1+ -- 4,000 4,020,331
- -----------------------------------------------------------------------------
</TABLE>
9
<PAGE>
<TABLE>
<CAPTION>
RATING(a) PAR
S&P MOODY'S (000) VALUE
<S> <C> <C> <C> <C>
Michigan - (continued)
Michigan State Hospital Finance
Authority
(Hospital Equipment Loan Program);
Hospital RB
4.55% Series 1993 12/01/23(b)(c) -- VMIG-1 $ 2,500 $ 2,500,000
- -----------------------------------------------------------------------------
4.45% Pooled Series 1994 A
12/01/23(b)(c) -- VMIG-1 3,800 3,800,000
- -----------------------------------------------------------------------------
4.45% Pooled Series 1995 A
12/01/23(b)(c) -- VMIG-1 15,000 15,000,000
- -----------------------------------------------------------------------------
Michigan State Hospital Finance
Authority (Mt. Clemens General
Hospital); Refunding Series 1994 RB
4.40% 08/15/15(b)(c) -- VMIG-1 12,100 12,100,000
- -----------------------------------------------------------------------------
Michigan Strategic Fund (260 Brown St.
Associates Project); Convertible
Variable Rate Demand Limited
Obligation
Series 1985 RB
3.75% 10/01/15(b)(c) -- VMIG-1 3,750 3,750,000
- -----------------------------------------------------------------------------
Michigan Strategic Fund (The Detroit
Edison Co. PCB Project); Adjustable
Rate Demand Limited Obligation
Refunding
Series 1995 CC RB
4.30% 09/01/30(b)(c) A-1+ P-1 4,000 4,000,000
- -----------------------------------------------------------------------------
University of Michigan; Adjustable Rate
Demand Hospital Refunding Series 1992
A RB
4.50% 12/01/19(b)(d) -- VMIG-1 2,500 2,500,000
- -----------------------------------------------------------------------------
Wayne County School District; State
School Aid
Series 1995 Limited Tax GO
4.50% 05/01/96 SP-1+ -- 7,500 7,527,577
- -----------------------------------------------------------------------------
64,367,908
- -----------------------------------------------------------------------------
MINNESOTA - 1.46%
Austin (City of) (Hy-Vee Foodstores
Inc. Project); Commercial Development
Series 1984 RB
3.75% 12/01/04(b)(c) A-1+ -- 900 900,000
- -----------------------------------------------------------------------------
Mankato (City of) (Northern States
Power Co. Project); Floating
Collateralized Series 1985 PCR
4.30% 03/01/11(b)(d) AA- A1 2,900 2,900,000
- -----------------------------------------------------------------------------
Red Wing (City of) Industrial
Development Authority (Northern States
Power Co.); Floating Rate
Collateralized Series 1985 PCR
4.30% 03/01/11(b)(d) AA- A1 4,600 4,600,000
- -----------------------------------------------------------------------------
University of Minnesota; Series A RB
7.625% 02/01/96(g) AAA -- 5,815 6,004,392
- -----------------------------------------------------------------------------
Western Minnesota Municipal Power
Agency; Power Supply Refunding Series
1985 A RB
9.50% 01/01/96(g) AAA Aaa 1,000 1,032,526
- -----------------------------------------------------------------------------
15,436,918
- -----------------------------------------------------------------------------
</TABLE>
10
<PAGE>
<TABLE>
<CAPTION>
RATING(a) PAR
S&P MOODY'S (000) VALUE
<S> <C> <C> <C> <C>
MISSISSIPPI - 0.75%
Mississippi (State of); Capital
Improvement Series A GO
5.50% 05/01/96 AA- Aa $ 2,705 $ 2,733,025
- -------------------------------------------------------------------------------
State Environment Improvement & Energy
Resources Authority (Union Electric Co.
Project); Adjustable-Fixed Rate PCR
4.00% Series 1984 A 06/01/96(c)(f) A-1+ P-1 1,000 1,000,000
- -------------------------------------------------------------------------------
4.00% Series 1984 B 06/01/96(c)(f) A-1+ P-1 4,250 4,250,000
- -------------------------------------------------------------------------------
7,983,025
- -------------------------------------------------------------------------------
MISSOURI - 4.00%
Columbia (City of); Special Obligation
Insurance Reserve
Series 1988 A Bonds
4.40% 06/01/08(b)(c) -- VMIG-1 2,800 2,800,000
- -------------------------------------------------------------------------------
Independence (City of) (The Independence
Ridge Apartment Project); Multi-Family
Housing Series 1985 RB
4.35% 12/01/15(b)(c) A-1+ -- 6,000 6,000,000
- -------------------------------------------------------------------------------
Kansas City (City of) Industrial
Development Authority (The Lorcarno
Multifamily Housing Project); Variable
Rate Demand Multifamily Housing Series
1985 RB
4.35% 12/01/15(b)(c) A-1+ -- 4,700 4,700,000
- -------------------------------------------------------------------------------
Missouri Health & Educational Facilities
Authority; School District Advance
Refunding Program Series 1995 Notes
4.50% 08/19/96 SP-1+ -- 6,840 6,871,805
- -------------------------------------------------------------------------------
Missouri Health & Educational Facilities
Authority (SSM Health Care Project);
Health Facililies Tax-Exempt Insured
Variable Rate Demand Series 1995 B RB
4.20% 06/01/22(b)(c) A-1+ Aaa 5,000 5,000,000
- -------------------------------------------------------------------------------
Missouri State Environmental Improvement
& Energy Resource Authority (Associated
Electric Cooperative, Inc. Project);
Pooled Series 1993-M RB
4.35% 12/15/03(b)(c) AA- VMIG-1 3,080 3,080,000
- -------------------------------------------------------------------------------
Saint Louis County Industrial Development
Authority (Bonhomme Village Apartments
Association Project); Variable Rate
Demand Housing Series 1985 RB
3.95% 10/01/07(b)(c) -- VMIG-1 6,900 6,900,000
- -------------------------------------------------------------------------------
Saint Louis County Industrial Development
Authority (Westport Station Project);
Multifamily Housing Series 1991 A RB
4.35% 07/15/06(b)(c) A-1+ -- 2,000 2,000,000
- -------------------------------------------------------------------------------
Saint Louis (City of); Series 1995 TRAN
4.50% 06/20/96 SP-1+ MIG-1 5,000 5,024,234
- -------------------------------------------------------------------------------
42,376,039
- -------------------------------------------------------------------------------
</TABLE>
11
<PAGE>
<TABLE>
<CAPTION>
RATING(a) PAR
S&P MOODY'S (000) VALUE
<S> <C> <C> <C> <C>
NEBRASKA - 0.59%
Buffalo (County of) (Franciscan
Healthcare Corp.-Kearny Hospital);
Hospital Series 1985 Bonds
4.45% 01/01/16(b)(c) -- VMIG-1 $ 1,200 $ 1,200,000
- -------------------------------------------------------------------------------
Nebraska Public Power District; Series B
Commercial Paper Notes
3.85% 11/16/95 A-1 P-1 5,000 5,000,000
- -------------------------------------------------------------------------------
6,200,000
- -------------------------------------------------------------------------------
NEVADA - 0.33%
Director of Nevada State Department of
Commerce (FMC Corp. Project); Series
1985 IDR
4.00% 09/15/96(c)(e) -- VMIG-1 3,500 3,500,000
- -------------------------------------------------------------------------------
NEW HAMPSHIRE - 0.54%
Business Finance Authority for the State
of New Hampshire (Connecticut Power &
Light); Series 1993 A PCR
4.40% 12/01/22(b)(c) -- VMIG-1 1,600 1,600,000
- -------------------------------------------------------------------------------
New Hampshire Higher Educational and
Health Facilities Authority (VHA of New
England Capital Asset Financial
Program); Variable Rate Hospital Series
1985 F RB
4.20% 12/01/25(b)(c) A-1 -- 3,700 3,700,000
- -------------------------------------------------------------------------------
New Hampshire Industrial Development
Authority (Bangor Hydro-Electric Co.
Project); Variable Rate Demand Series
1983 PCR
3.65% 01/01/09(b)(c) A-1+ -- 400 400,000
- -------------------------------------------------------------------------------
5,700,000
- -------------------------------------------------------------------------------
NEW MEXICO - 1.97%
Albuquerque Airport; Adjustable Refunding
Subordinated Lien
Series 1995 RB
4.30% 07/01/14(b)(c) -- VMIG-1 11,000 11,000,000
- -------------------------------------------------------------------------------
Albuquerque (City of) Sisters of Charity
Health Care System
(St. Joseph's Healthcare System
Project); Adjustable Rate Demand Issue
1992 RB
4.35% 05/15/22(b)(d) A-1+ VMIG-1 7,000 7,000,000
- -------------------------------------------------------------------------------
Hurley (Town of) (Kennecott Santa Fe
Corp. Project); Unit Priced Demand
Adjustable Series 1985 PCR
4.45% 12/01/15(b)(d) AA- A1 2,800 2,800,000
- -------------------------------------------------------------------------------
20,800,000
- -------------------------------------------------------------------------------
NEW YORK - 12.70%
Eagle Tax Exempt Trust; Class A
Certificates of Participation(e)
4.49% Series 1993 E 08/01/06(b)(d) A-1+c -- 15,000 15,000,000
- -------------------------------------------------------------------------------
4.49% Series 943802 05/01/07(b)(c) A-1+c -- 17,800 17,800,000
- -------------------------------------------------------------------------------
4.49% Series 943901 06/15/07(b)(c) A-1c -- 14,500 14,500,000
- -------------------------------------------------------------------------------
</TABLE>
12
<PAGE>
<TABLE>
<CAPTION>
RATING(a) PAR
S&P MOODY'S (000) VALUE
<S> <C> <C> <C> <C>
New York - (continued)
Eagle Tax Exempt Trust - (continued)
4.49% Series 1993 F 08/01/07(b)(d) A-1c -- $20,500 $20,500,000
- ------------------------------------------------------------------------------
4.49% Series 94C2102 06/01/14(b)(c) A-1+c -- 12,300 12,300,000
- ------------------------------------------------------------------------------
4.49% Series 1994 C-1 06/15/18(b)(g) A-1+c -- 18,000 18,000,000
- ------------------------------------------------------------------------------
4.49% Series 943207 07/01/29(b)(c) A-1+c -- 14,200 14,200,000
- ------------------------------------------------------------------------------
Merrill Lynch Group - P-Float Program; Power
Supply System
Series 1993 A RB
4.50% 01/01/16(b)(c)(e) -- VMIG-1 5,000 5,000,000
- ------------------------------------------------------------------------------
New York (City of); General Obligation
Fiscal Series 1996 B RAN
4.75% 06/28/96(c) SP-1 MIG-1 5,000 5,028,000
- ------------------------------------------------------------------------------
New York (City of); Variable Rate Demand GO
4.45% Series 1995 F 02/15/16(b)(c) A-1+ VMIG-1 7,500 7,500,000
- ------------------------------------------------------------------------------
New York (City of) Municipal Water Finance
Authority; Water and Sewer Series 1994 C RB
4.60% 06/15/23(b)(c) A-1+ VMIG-1 2,100 2,100,000
- ------------------------------------------------------------------------------
New York State Thruway Authority; Series A
RB
4.20% 04/01/96(c) AAA Aaa 1,000 1,000,845
- ------------------------------------------------------------------------------
Syracuse (City of) Industrial Development
Authority (Syracuse University - Eggars
Hall Project); Civic Facility Series 1993
RB
4.85% 03/01/23(b)(c) A-1+ VMIG-1 1,500 1,500,000
- ------------------------------------------------------------------------------
134,428,845
- ------------------------------------------------------------------------------
NORTH CAROLINA - 0.72%
Alamance Industrial Facilities & Pollution
Control Financing Authority (Science
Manufacturing Inc. Project); Series 1985
IDR
4.85% 04/01/15(b)(c) -- P-1 4,400 4,400,000
- ------------------------------------------------------------------------------
Haywood Industrial Facilities & Pollution
Control Authority (Champion International
Corp. Project); Solid Waste RB
4.35% 03/01/20(b)(c) -- P-1 2,200 2,200,000
- ------------------------------------------------------------------------------
New Hanover County Industrial Facilities and
Pollution Control Financing Authority
(Gang-Nail Systems, Inc. Project);
Series 1984 IDR
4.45% 12/01/99(b)(c) -- P-1 1,000 1,000,000
- ------------------------------------------------------------------------------
7,600,000
- ------------------------------------------------------------------------------
OHIO - 1.86%
Cleveland (City of) Ohio School District;
Series 1995 RAN
4.50% 06/01/96(c) AAA Aaa 5,044 5,030,855
- ------------------------------------------------------------------------------
Cuyahoga (County of) (S&R Playhouse Realty
Co.); Adjustable Rate Demand Series 1984
IDR
3.85% 12/01/09(b)(c) -- MIG-1 670 670,000
- ------------------------------------------------------------------------------
</TABLE>
13
<PAGE>
<TABLE>
<CAPTION>
RATING(a) PAR
S&P MOODY'S (000) VALUE
<S> <C> <C> <C> <C>
Ohio - (continued)
Franklin (County of) (Bricker & Eckler
Building Co. Project); Variable Rate
Demand Series 1984 IDR
4.65% 11/01/14(b)(c) -- P-1 $ 9,000 $ 9,000,000
- -------------------------------------------------------------------------------
Ohio Air Quality Development Authority
(The Cincinnati Gas & Electric Co.
Project); Air Quality Development
Refunding Series 1995 A RB
4.50% 09/01/30(b)(c) -- VMIG-1 4,000 4,000,000
- -------------------------------------------------------------------------------
Ohio Housing Finance Agency (Kenwood
Congregate Retirement Community
Project); Variable Rate Demand
Multifamily Housing Series 1985 RB
3.55% 12/01/15(b)(c) -- VMIG-1 980 980,000
- -------------------------------------------------------------------------------
19,680,855
- -------------------------------------------------------------------------------
OREGON - 2.29%
Klamath Falls (City of) (Salt Caves
Hydroelectric Project); Fixed Adjustable
Rate Electric Series 1986 B RB
4.40% 05/01/96(f)(g) SP-1+ -- 12,050 12,050,000
- -------------------------------------------------------------------------------
Multnomah County School District No. 1J;
Series 1995 TRAN
4.75% 05/30/96 SP-1+ MIG-1 5,000 5,033,623
- -------------------------------------------------------------------------------
Portland (City of) (South Park Block
Project); Multifamily Housing Refunding
Series 1988 A RB
4.40% 12/01/11(b)(c) A-1+ -- 4,900 4,900,000
- -------------------------------------------------------------------------------
Saint Helens (Port of) (Portland General
Electric Co. Project); Refunding Series
1985 B PCR
4.45% 06/01/10(b)(c) A-1+ VMIG-1 2,300 2,300,000
- -------------------------------------------------------------------------------
24,283,623
- -------------------------------------------------------------------------------
PENNSYLVANIA - 1.07%
Beaver County Industrial Development
Authority (Duquesne Light Co. Project);
Refunding Series 1994 PCR
4.50% 10/10/95(g) -- Aa1 2,000 2,000,000
- -------------------------------------------------------------------------------
Beaver County Industrial Development
Authority (Ohio Edison Co.); Series A
PCR
3.45% 10/01/95(c) A-1+ P-1 1,500 1,499,950
- -------------------------------------------------------------------------------
Delaware County Industrial Development
Authority (Henderson-Radnor Joint
Venture Project); Limited Obligation
Series 1985 RB
4.375% 04/01/15(b)(c) -- Aa3 1,000 1,000,000
- -------------------------------------------------------------------------------
Delaware County Industrial Development
Authority (Scott Paper Co. Project);
Variable Rate Demand Solid Waste Series
1984 D RB
4.40% 12/01/18(b)(c) A-1+ -- 400 400,000
- -------------------------------------------------------------------------------
Quakertown Hospital Authority (HPF
Group); Variable Rate
Series 1985 A RB
4.35% 07/01/05(b)(c) -- VMIG-1 1,800 1,800,000
- -------------------------------------------------------------------------------
</TABLE>
14
<PAGE>
<TABLE>
<CAPTION>
RATING(a) PAR
S&P MOODY'S (000) VALUE
<S> <C> <C> <C> <C>
Pennsylvania - (continued)
Schuykill County Industrial Development
Authority (Gilberton Power Project);
Variable Rate Resource Recovery Series
1985 RB
4.45% 12/01/02(b)(c) A-1 -- $ 2,300 $ 2,300,000
- -----------------------------------------------------------------------------
Wilkes-Barre (City of) Industrial
Development Authority (Toys "R"
Us/Penn Inc. Project); Economic
Development Series 1984 RB
4.125% 07/01/14(b)(c) -- A1 2,300 2,300,000
- -----------------------------------------------------------------------------
11,299,950
- -----------------------------------------------------------------------------
SOUTH CAROLINA - 4.31%
Florence (County of) (Stone Container
Corp.); Variable Rate
Series 1984 IDR
4.00% 02/01/07(b)(c) A-1+ -- 15,000 15,000,000
- -----------------------------------------------------------------------------
Goldman Sachs Co., Inc.; Tender Option
Series 1995 F Certificates
4.55% 06/16/14(b)(c)(e) A-1+c -- 12,500 12,500,000
- -----------------------------------------------------------------------------
Horry (County of) (Carolina Treatment
Center); Variable Rate Demand Series
1984 RB
4.40% 12/01/14(b)(c) -- Aa2 600 600,000
- -----------------------------------------------------------------------------
Lexington (County of) (Charter Rivers
Hospital); Adjustable Rate Refinancing
Series 1987 RB
4.60% 06/01/07(b)(c) -- VMIG-1 2,300 2,300,000
- -----------------------------------------------------------------------------
South Carolina (State of); Capital
Improvement Series B GO
6.80% 03/01/96 AA+ Aaa 1,500 1,520,709
- -----------------------------------------------------------------------------
York (County of) (North Carolina
Electric Membership Corp.); PCR
3.75% Pooled Series 1984 N-3
03/15/96(g) A-1+ VMIG-1 6,400 6,400,000
- -----------------------------------------------------------------------------
4.35% Pooled Series 1984 N-2
09/15/14(b)(c) A-1+ P-1 1,750 1,750,000
- -----------------------------------------------------------------------------
York (County of) (Saluda River Electric
Cooperative, Inc. Project); Pooled
Series 1984-E1 RB
3.80% 02/15/96(g) -- MIG-1 5,555 5,555,000
- -----------------------------------------------------------------------------
45,625,709
- -----------------------------------------------------------------------------
TENNESSEE - 8.00%
Health and Educational Board of the
Metropolitan Government of Nashville
and Davidson County (Baptist
Hospital); Hospital
Series 1992 RB
4.15% 10/26/95(d)(g) A-1c VMIG-1 8,000 8,000,000
- -----------------------------------------------------------------------------
Health, Educational and Housing
Facility Board of Shelby County
(Rhodes College); Variable Rate Demand
Educational Facilities Series 1985 RB
3.90% 08/10/10(b)(c) A-1+ -- 2,195 2,195,000
- -----------------------------------------------------------------------------
Industrial Development Board of the
City of Franklin (The Landings
Project); Variable Rate Demand
Multifamily Housing
Series 1985 Class A RB
4.35% 12/01/06(b)(c) A-1+ -- 2,000 2,000,000
- -----------------------------------------------------------------------------
</TABLE>
15
<PAGE>
<TABLE>
<CAPTION>
RATING(a) PAR
S&P MOODY'S (000) VALUE
<S> <C> <C> <C> <C>
Tennessee - (continued)
Industrial Development Board of the City
of Knoxville (Toys "R" Us Inc., Project);
Series 1984 IDR
4.65% 05/01/14(b)(c) -- A1 $ 1,150 $ 1,150,000
- -------------------------------------------------------------------------------
Industrial Development Board of the County
of Bradley (Olin Corp.); Refunding Series
1993 C RB
4.55% 11/01/17(b)(c) A-1+ -- 4,600 4,600,000
- -------------------------------------------------------------------------------
Knox (County of) Industrial Development
Authority (Centre Square II, Ltd.
Project); Floating Rate Monthly Demand
Series 1984 IDR
3.90% 12/01/14(b)(c) A-1+ -- 5,400 5,400,000
- -------------------------------------------------------------------------------
Knox (County of) Industrial Development
Authority (Professional Plaza, Ltd.
Project); Floating Rate Monthly Demand
Series 1984 IDR
3.90% 12/01/14(b)(c) A-1+ -- 2,900 2,900,000
- -------------------------------------------------------------------------------
Knox (County of) Industrial Development
Authority (Old Kingston Properties);
Floating Rate Industrial Series 1984 RB
3.90% 12/01/14(b)(c) A-1+ -- 3,500 3,500,000
- -------------------------------------------------------------------------------
Knox County Industrial Development
Authority (Weisgarber Partners); Floating
Rate Series 1984 IDR
3.90% 12/01/14(b)(c) A-1+ -- 700 700,000
- -------------------------------------------------------------------------------
Metro Nashville Airport Authority;
Adjustable Rate Refunding
Series 1993 RB
4.20% 07/01/19(b)(c) A-1+ VMIG-1 1,900 1,900,000
- -------------------------------------------------------------------------------
Nashville and Davidson (County of)
Industrial Development Board
of Metro Government (Amberwood, Ltd.
Project); Multifamily Housing RB
4.64% Series 1993 A 07/01/13(b)(c) -- VMIG-1 2,450 2,450,000
- -------------------------------------------------------------------------------
4.64% Series 1993 B 07/01/13(b)(c) -- VMIG-1 2,065 2,065,000
- -------------------------------------------------------------------------------
Tennessee (State of); General Obligation
BAN
4.25% Series 1994 A 05/01/96(b) A-1+ VMIG-1 200 200,000
- -------------------------------------------------------------------------------
4.25% Series 1995 A 05/01/96(b) A-1+ VMIG-1 11,000 11,000,000
- -------------------------------------------------------------------------------
4.25% Series 1994 B 05/01/96(b) A-1+ VMIG-1 2,000 2,000,000
- -------------------------------------------------------------------------------
Tennessee Higher Educational Facilities;
Variable Rate
Series 1993 B BAN
4.25% 03/01/98(b)(d) A-1+ VMIG-1 1,400 1,400,000
- -------------------------------------------------------------------------------
</TABLE>
16
<PAGE>
<TABLE>
<CAPTION>
RATING(a) PAR
S&P MOODY'S (000) VALUE
<S> <C> <C> <C> <C>
Tennessee - (continued)
Tennessee Local Development Authority;
State Loan Programs Revenue Series 1995
A BAN
4.75% 05/31/96 SP-1+ MIG-1 $15,000 $ 15,073,731
- ------------------------------------------------------------------------------
Tennessee State School Bond Authority;
Higher Educational Facilities BAN
4.25% Series 1993 A 03/01/98(b)(d) A-1+ VMIG-1 5,875 5,875,000
- ------------------------------------------------------------------------------
4.25% Series 1995 A 03/01/98(b)(d) A-1+ VMIG-1 4,525 4,525,000
- ------------------------------------------------------------------------------
4.25% Series 1995 B 03/01/98(b)(d) A-1+ VMIG-1 7,750 7,750,000
- ------------------------------------------------------------------------------
84,683,731
- ------------------------------------------------------------------------------
TEXAS - 10.07%
Angelina & Neches River Authority
Industrial Development Corp.
(Temple - Inland Marine); Solid Waste
Disposal RB
4.85% Series 1984 B 05/01/14(b)(c) -- P-1 5,200 5,200,000
- ------------------------------------------------------------------------------
4.85% Series 1984 D 05/01/14(b)(c) -- P-1 7,800 7,800,000
- ------------------------------------------------------------------------------
4.85% Series 1984 E 05/01/14(b)(c) -- P-1 2,400 2,400,000
- ------------------------------------------------------------------------------
Brazos River Harbor Navigation District
of Brazoria County
(Hoffman-La Roche Inc. Project); Series
1985 RB
4.25% 04/01/02(b)(c) -- A1 2,750 2,750,000
- ------------------------------------------------------------------------------
Brownsville (City of); Utility System
Series A Commercial Paper Notes
3.70% 11/20/95(c) A-1+ P-1 1,500 1,500,000
- ------------------------------------------------------------------------------
Dallas-Fort Worth International Airport
Board; Commercial Paper Notes
3.85% 10/18/95(c)(f) -- VMIG-1 4,000 4,000,000
- ------------------------------------------------------------------------------
Fort Worth (City of) Water and Sewer
System; Tax Exempt
Series A Commercial Paper
3.90% 12/08/95 A-1+ P-1 5,000 5,000,000
- ------------------------------------------------------------------------------
Galveston, Texas Industrial Development
Corp. (Mitchell Interests Project);
Industrial Refunding Series 1993 RB
4.35% 06/01/09(b)(c) A-1+ -- 2,600 2,600,000
- ------------------------------------------------------------------------------
Harris County Health Development Corp.
(The Methodist Hospital); Hospital
Series 1994 RB
4.85% 12/01/25(b)(d) A-1+ -- 21,900 21,900,000
- ------------------------------------------------------------------------------
Harris County Health Facilities
Development Corp. (Gulf Coast Regional
Blood Center Project); Series 1992 RB
4.50% 04/01/17(b)(c) A-1 -- 3,650 3,650,000
- ------------------------------------------------------------------------------
Harris County Health Facilities
Development Corp. (St. Luke's Episcopal
Hospital Project); Hospital Series 1985
C RB
4.85% 02/15/16(b)(d) A-1+ -- 3,200 3,200,000
- ------------------------------------------------------------------------------
Harris County Health Facilities
Development Corp. (Texas Medical Center
Project); Series 1992 RB
4.80% 02/15/22(b)(c) A-1 VMIG-1 1,300 1,300,000
- ------------------------------------------------------------------------------
Hockley County Industrial Development
Corp. (Amoco Project); Adjustable-Rate
Series 1983 PCR
3.65% 03/01/96(d)(f) A-1+ -- 5,700 5,696,477
- ------------------------------------------------------------------------------
</TABLE>
17
<PAGE>
<TABLE>
<CAPTION>
RATING(a) PAR
S&P MOODY'S (000) VALUE
<S> <C> <C> <C> <C>
Texas - (continued)
Houston (City of); Senior Lien Hotel
Occupancy Tax Refunding
Series 1995 RB
5.00% 07/01/96(c) AAA Aaa $ 650 $ 655,194
- ------------------------------------------------------------------------------
Hunt (County of) Texas Health Facilities
Development Corp. (Universal Health
Services of Greenville); Series 1985 RB
4.40% 10/01/15(b)(c) A-1+ -- 2,000 2,000,000
- ------------------------------------------------------------------------------
Lower Colorado River Authority; Series B
Commercial Paper Notes
3.90% 10/11/95 A-1+ P-1 2,000 2,000,000
- ------------------------------------------------------------------------------
3.80% 11/16/95 A-1+ P-1 7,000 7,000,000
- ------------------------------------------------------------------------------
Lubbock Health Facilities Development
Corp. (St. Joseph's Health System);
Refunding Series 1985 A RB
4.50% 07/01/13(b)(d) A-1+ VMIG-1 1,300 1,300,000
- ------------------------------------------------------------------------------
North Central Texas Health Development
Corp. (Methodist Hospital of Dallas);
Hospital Series 1985 B RB
4.85% 10/01/15(b)(c) A-1 Aaa 2,600 2,600,000
- ------------------------------------------------------------------------------
Nueces County Health Facilities
Development Corp. (Driscoll Childrens
Hospital); Floating Rate Demand
Hospital Series 1985 RB
4.35% 07/01/15(b)(c) -- VMIG-1 2,570 2,570,000
- ------------------------------------------------------------------------------
Tarrant (County of) Texas Housing
Finance Corp. (Amherst Associates
Project); Multifamily Housing Series
1995 RB
4.30% 12/01/07(b)(c) -- VMIG-1 3,220 3,220,000
- ------------------------------------------------------------------------------
Texas (State of); Series 1995 A TRAN
4.75% 08/30/96 SP-1+ MIG-1 15,000 15,095,563
- ------------------------------------------------------------------------------
Texas Public Finance Authority; Series
1994 A GO
5.00% 10/01/95 AA Aa 1,000 1,000,036
- ------------------------------------------------------------------------------
Trinity River Industrial Development
Authority (Radiation Sterilizers, Inc.
Project); Variable Rate Demand IDR
3.85% Series 1985 A 11/01/05(b)(c) A-1 -- 500 500,000
- ------------------------------------------------------------------------------
3.85% Series 1985 B 11/01/05(b)(c) A-1 -- 1,650 1,650,000
- ------------------------------------------------------------------------------
106,587,270
- ------------------------------------------------------------------------------
UTAH - 3.41%
Bountiful (City of) (Bountiful Gateway
Park Project); Adjustable Rate
Refunding Series 1987 IDR
3.95% 12/01/97(b)(c) A-1+ -- 3,885 3,885,000
- ------------------------------------------------------------------------------
Provo (City of) Energy Systems; Series A
RB
9.50% 11/01/95(f)(g)(h) -- -- 1,500 1,551,333
- ------------------------------------------------------------------------------
Salt Lake (County of) Service Station
Holdings; Series 1994 B PCR
4.85% 08/01/07(b)(d) -- P-1 12,315 12,315,000
- ------------------------------------------------------------------------------
</TABLE>
18
<PAGE>
<TABLE>
<CAPTION>
RATING(a) PAR
S&P MOODY'S (000) VALUE
<S> <C> <C> <C> <C>
Utah - (continued)
State Board of Regents of the State of
Utah; Variable Rate Demand Series 1988 B
RB
4.40% 11/01/00(b)(c) A-1+ VMIG-1 $ 1,600 $ 1,600,000
- -------------------------------------------------------------------------------
State Board of Regents of the State of
Utah (University Inn Project); Variable
Rate Demand Series 1985 IDR
4.25% 12/01/15(b)(c) -- P-1 8,935 8,935,000
- -------------------------------------------------------------------------------
Utah State Housing Finance Agency; Single
Family Mortgage Variable Rate Issue 1993
D RB
4.45% 07/01/16(b) -- VMIG-1 7,800 7,800,000
- -------------------------------------------------------------------------------
36,086,333
- -------------------------------------------------------------------------------
VIRGINIA - 1.79%
Fairfax County Redevelopment and Housing
Authority (Chase Commons Project);
Variable Rate Demand Series 1984 A RB
4.525% 12/01/06(b)(c) -- VMIG-1 3,330 3,330,000
- -------------------------------------------------------------------------------
Industrial Development Authority of
Fairfax County (Fairfax Hospital Systems,
Inc.); Variable Rate Demand Obligation
Refunding Series 1985 A RB
4.30% 10/01/16(b)(d) A-1+ VMIG-1 2,300 2,300,000
- -------------------------------------------------------------------------------
Industrial Development Authority of
Fairfax County (Inova Services Inc.);
Variable Rate Demand Obligation Series
1989 A
4.30% 01/15/22(b)(d) A-1+ VMIG-1 2,100 2,100,000
- -------------------------------------------------------------------------------
Peninsula Ports Authority of Virginia
(Dominion Terminal Associates); Coal
Terminal Refunding Series 1987 D RB
4.45% 07/01/16(b)(c) -- P-1 1,000 1,000,000
- -------------------------------------------------------------------------------
Virginia Housing Development Authority
(AHC Service Corp.); Variable Rate Demand
Housing Series 1987 A RB
4.50% 09/01/17(b)(c) -- P-1 10,180 10,180,000
- -------------------------------------------------------------------------------
18,910,000
- -------------------------------------------------------------------------------
WASHINGTON - 0.48%
Industrial Development Corp. of the Port
of Port Townsend (Port Townsend Paper
Corp. Project); Variable Rate Refunding
Series 1988 A RB
4.35% 03/01/09(b)(c) -- VMIG-1 5,100 5,100,000
- -------------------------------------------------------------------------------
WEST VIRGINIA - 1.33%
Kanawha County Building Commission
(Charleston Area Medical Center, Inc.);
Hospital Refunding Series 1989 B RB
4.55% 11/01/13(b)(c) -- VMIG-1 4,375 4,375,000
- -------------------------------------------------------------------------------
Marshall (County of) (Mountaineer Carbon
Co. Project); Series 1985 PCR
4.85% 12/01/20(b)(d) AA- A1 2,700 2,700,000
- -------------------------------------------------------------------------------
</TABLE>
19
<PAGE>
<TABLE>
<CAPTION>
RATING(a) PAR
S&P MOODY'S (000) VALUE
<S> <C> <C> <C> <C>
West Virginia - (continued)
West Virginia Hospital Finance
Authority (VHA Mid-Atlantic States,
Inc. Capital Asset Financing
Program); Variable Rate Demand
Hospital RB
4.20% Series 1985 A 12/01/25(b)(c) A-1 -- $ 600 $ 600,000
- -----------------------------------------------------------------------------
4.20% Series 1985 D 12/01/25(b)(c) A-1 -- 3,800 3,800,000
- -----------------------------------------------------------------------------
4.20% Series 1985 F 12/01/25(b)(c) A-1 -- 1,300 1,300,000
- -----------------------------------------------------------------------------
4.20% Series 1985 G 12/01/25(b)(c) A-1 -- 1,300 1,300,000
- -----------------------------------------------------------------------------
14,075,000
- -----------------------------------------------------------------------------
WISCONSIN - 1.95%
City of Milwaukee Housing Authority
(Yankee Hill Apartments Project);
Multi-Family Housing 1986 Issue
Variable Bonds
4.35% 12/01/09(b)(c) A-1+ -- 5,500 5,500,000
- -----------------------------------------------------------------------------
Wisconsin (State of); General
Obligation Operating Series 1995
Notes
4.50% 06/17/96 SP-1 MIG-1 15,000 15,085,482
- -----------------------------------------------------------------------------
20,585,482
- -----------------------------------------------------------------------------
TOTAL INVESTMENTS - 103.86% 1,098,933,910 (i)
- -----------------------------------------------------------------------------
OTHER ASSETS LESS LIABILITIES -
(3.86%) (40,794,697)
- -----------------------------------------------------------------------------
NET ASSETS - 100.00% $1,058,139,213
=============================================================================
</TABLE>
INVESTMENT ABBREVIATIONS:
BAN Bond Anticipation Notes
GO General Obligation Bonds
IDR Industrial Development Revenue Bonds
PCR Pollution Control Revenue Bonds
RAN Revenue Anticipation Notes
RB Revenue Bonds
TAN Tax Anticipation Notes
TRAN Tax and Revenue Anticipation Notes
NOTES TO SCHEDULE OF INVESTMENTS:
(a) Ratings assigned by Standard & Poor's Corporation ("S&P") and Moody's
Investors Service, Inc. ("Moody's").
(b) Demand security; payable upon demand by the Fund at specified time
intervals no greater than thirteen months. Interest rates are redetermined
periodically. Rates shown are the rates in effect on September 30, 1995.
(c) Security is secured by a letter of credit.
(d) Security is secured by bond insurance.
(e) The Fund may invest in synthetic municipal instruments the value of and
return on which are derived from underlying securities. The types of
synthetic municipal instruments in which the Fund may invest include
variable rate instruments. These instruments involve the deposit into a
trust of one or more long-term tax-exempt bonds or notes ("Underlying
Bonds"), and the sale of certificates evidencing interests in the trust to
investors such as the Fund. The trustee receives the long-term fixed rate
interest payments on the Underlying Bonds, and pays certificate holders
short-term floating or variable interest rates which are reset
periodically. A "variable rate trust certificate" evidences an interest in
a trust entitling the certificate holder to receive variable rate interest
based on prevailing short-term interest rates and also typically providing
the certificate holder with the conditional right to put its certificate at
par value plus accrued interest. Because synthetic municipal instruments
involve a trust and a third party conditional put feature, they involve
complexities and potential risks that may not be present where a municipal
security is owned directly.
(f) Security has an outstanding call or mandatory put by the issuer. Par value
and maturity date reflect such call or put.
(g) Security is secured by an escrow fund.
(h) Unrated security; determined by the directors to be of comparable quality
to the rated determination of quality adopted by the Board of Directors and
followed by the investment advisor.
(i) Cost for federal income tax purposes is $1,098,923,738.
See Notes to Financial Statements.
20
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
September 30, 1995
(Unaudited)
<TABLE>
<S> <C>
ASSETS:
Investments, at value (amortized cost) $1,098,933,910
- ------------------------------------------------------------------------
Cash 375,662
- ------------------------------------------------------------------------
Receivables for:
Investments sold 720,723
- ------------------------------------------------------------------------
Interest 6,312,136
- ------------------------------------------------------------------------
Investment for deferred compensation plan 11,520
- ------------------------------------------------------------------------
Other assets 79,571
- ------------------------------------------------------------------------
Total assets 1,106,433,522
- ------------------------------------------------------------------------
LIABILITIES:
Payables for:
Investments purchased 44,727,243
- ------------------------------------------------------------------------
Dividends 3,254,607
- ------------------------------------------------------------------------
Deferred compensation 11,520
- ------------------------------------------------------------------------
Accrued advisory fees 148,565
- ------------------------------------------------------------------------
Accrued directors' fees 2,707
- ------------------------------------------------------------------------
Accrued accounting service fees 6,173
- ------------------------------------------------------------------------
Accrued transfer agent fees 3,641
- ------------------------------------------------------------------------
Accrued distribution fees 6,756
- ------------------------------------------------------------------------
Accrued operating expenses 133,097
- ------------------------------------------------------------------------
Total liabilities 48,294,309
- ------------------------------------------------------------------------
NET ASSETS $1,058,139,213
========================================================================
NET ASSETS:
Institutional Shares $1,024,141,187
========================================================================
Private Investment Class $ 33,998,026
========================================================================
CAPITAL STOCK, $0.001 PAR VALUE PER SHARE:
Institutional Shares:
Authorized 3,000,000,000
- ------------------------------------------------------------------------
Outstanding 1,024,450,229
========================================================================
Private Investment Class:
Authorized 1,000,000,000
- ------------------------------------------------------------------------
Outstanding 34,008,285
========================================================================
NET ASSET VALUE PER SHARE:
Net asset value, offering and redemption price per share $1.00
========================================================================
</TABLE>
See Notes to Financial Statements.
21
<PAGE>
STATEMENT OF OPERATIONS
For the six months ended September 30, 1995
(Unaudited)
<TABLE>
<CAPTION>
PRIVATE
INSTITUTIONAL INVESTMENT
SHARES CLASS FUND
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest income $21,456,166 $609,369 $22,065,535
- -----------------------------------------------------------------------
EXPENSES:
Advisory fees 1,217,840 34,470 1,252,310
- -----------------------------------------------------------------------
Custodian fees 44,108 1,554 45,662
- -----------------------------------------------------------------------
Transfer agent fees 17,816 6,382 24,198
- -----------------------------------------------------------------------
Registration and filing fees 411 11,489 11,900
- -----------------------------------------------------------------------
Accounting service fees 38,864 1,216 40,080
- -----------------------------------------------------------------------
Directors' fees 6,861 161 7,022
- -----------------------------------------------------------------------
Distribution fees -- 38,288 38,288
- -----------------------------------------------------------------------
Other expenses 90,552 1,308 91,860
- -----------------------------------------------------------------------
Total expenses 1,416,452 94,868 1,511,320
- -----------------------------------------------------------------------
Less expenses assumed by advisor (320,439) (25,070) (345,509)
- -----------------------------------------------------------------------
Net expenses 1,096,013 69,798 1,165,811
- -----------------------------------------------------------------------
Net investment income $20,360,153 $539,571 20,899,724
- -----------------------------------------------------------------------
Net realized gain on sales of investments 54,576
- -----------------------------------------------------------------------
Net unrealized appreciation (depreciation) of investments (26,182)
- -----------------------------------------------------------------------
Net increase in net assets resulting from operations $20,928,118
=======================================================================
</TABLE>
See Notes to Financial Statements.
22
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
For the six months ended September 30, 1995 and the year ended March 31, 1995
(Unaudited)
<TABLE>
<CAPTION>
SEPTEMBER 30, MARCH 31,
1995 1995
<S> <C> <C>
OPERATIONS:
Net investment income $ 20,899,724 $ 33,546,101
- -----------------------------------------------------------------------------
Net realized gain (loss) on sales of
investments 54,576 (430,985)
- -----------------------------------------------------------------------------
Net unrealized appreciation (depreciation)
of investments (26,182) 33,165
- -----------------------------------------------------------------------------
Net increase in net assets resulting from
operations 20,928,118 33,148,281
- -----------------------------------------------------------------------------
Distributions to shareholders from net
investment income:
Institutional Shares (20,360,153) (32,833,365)
- -----------------------------------------------------------------------------
Private Investment Class (539,571) (712,736)
- -----------------------------------------------------------------------------
Share transactions - net:
Institutional Shares 14,221,594 (30,316,694)
- -----------------------------------------------------------------------------
Private Investment Class 4,711,987 12,695,756
- -----------------------------------------------------------------------------
Net increase (decrease) in net assets 18,961,975 (18,018,758)
- -----------------------------------------------------------------------------
NET ASSETS:
Beginning of period 1,039,177,238 1,057,195,996
- -----------------------------------------------------------------------------
End of period $1,058,139,213 $1,039,177,238
=============================================================================
NET ASSETS CONSIST OF:
Capital (par value and additional paid-in):
Institutional Shares $1,024,450,229 $1,010,228,635
- -----------------------------------------------------------------------------
Private Investment Class 34,008,285 29,296,298
- -----------------------------------------------------------------------------
Undistributed net realized gain (loss) on
sales of investments (329,473) (384,049)
- -----------------------------------------------------------------------------
Unrealized appreciation of investments 10,172 36,354
- -----------------------------------------------------------------------------
$1,058,139,213 $1,039,177,238
=============================================================================
</TABLE>
See Notes to Financial Statements.
23
<PAGE>
NOTES TO FINANCIAL STATEMENTS
September 30, 1995
(Unaudited)
NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES
Tax-Free Investments Co. (the "Company") is registered under the Investment
Company Act of 1940, as amended (the "1940 Act"), as a diversified, open-end
management investment company. The Company is organized as a Maryland
corporation consisting of one portfolio, the Cash Reserve Portfolio (the
"Fund"). The Fund consists of two different classes of shares, the
Institutional Cash Reserve Shares ("Institutional Shares") and the Private
Investment Class.
The following is a summary of the significant accounting policies followed by
the Fund in the preparation of its financial statements.
A. Securities Valuations - The Fund uses the amortized cost method of valuing
investment portfolio securities which has been determined by the Board of
Directors of the Company to represent the fair value of the Fund's
investments.
B. Securities Transactions and Investment Income - Securities transactions are
recorded on a trade date basis. Interest income, adjusted for amortization
of premiums and, when appropriate, discounts on investments, is earned from
settlement date and is recorded on the accrual basis. Interest income is
allocated to each class daily, based upon each class' pro rata share of the
total shares of the Fund outstanding. Discounts, other than original issue,
on short-term obligations are amortized to unrealized appreciation for
financial reporting purposes. Realized gains and losses from securities
transactions are computed on the basis of specific identification of the
securities sold.
C. Dividends and Distributions to Shareholders - It is the policy of the Fund
to declare daily dividends from net investment income. Such dividends are
paid monthly. Distributions from net realized capital gains, if any, are
declared and paid annually. Net capital gains cannot be distributed to the
extent they can be offset by any capital loss carryovers of the Fund.
D. Federal Income Taxes - The Fund 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. The Fund has a capital loss
carryforward of $97,086 (which may be carried forward to offset future
taxable gains, if any) which expires, if not previously utilized, through
the year 2003. The Fund cannot distribute capital gains to shareholders
until the tax loss carryforwards have been utilized. In addition, the Fund
intends to invest in sufficient municipal securities to allow it to qualify
to pay "exempt interest dividends," as defined in the Internal Revenue Code,
to shareholders.
E. Expenses - Operating expenses directly attributable to a class are charged
to that class' operations. Expenses which are applicable to both classes,
e.g., advisory fees, are allocated between them.
24
<PAGE>
NOTE 2 - ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES
The Company has entered into a master investment advisory agreement with A I M
Advisors, Inc. ("AIM"). Under the terms of the master investment advisory
agreement, the Fund pays an advisory fee to AIM at the annual rate of 0.25% of
the first $500 million of the Fund's average daily net assets plus 0.20% of the
Fund's average daily net assets in excess of $500 million. AIM will, if
necessary, reduce its fees for any fiscal year to the extent required so that
the amount of ordinary expenses of each class (excluding interest, taxes,
brokerage commissions and extraordinary expenses) paid or incurred by each
class for such fiscal year does not exceed the applicable expense limitations
imposed by securities regulations in any state or jurisdiction in which the
Company's shares are qualified for sale.
AIM has voluntarily agreed to reduce its fee from the Fund to the extent
necessary so that the amount of ordinary expenses of the Institutional Shares
(excluding interest, taxes, brokerage commissions, directors' fees,
extraordinary expenses and federal registration fees) paid or incurred by the
Institutional Shares does not exceed 0.20% of the Institutional Shares' average
daily net assets. As a result, AIM's advisory fee on the Private Investment
Class is reduced in the same proportion as the Institutional Shares. For the
six months ended September 30, 1995, AIM reduced its fees from the Fund by
$329,509. AIM also assumed expenses of $16,000 on the Private Investment Class
during the same period.
The Company has entered into a master distribution agreement with Fund
Management Company ("FMC") for the distribution of shares of the Institutional
Shares and the Private Investment Class. The Company has also adopted a
distribution plan (the "Plan") pursuant to Rule 12b-1 under the 1940 Act with
respect to the Private Investment Class. The Plan provides that the Private
Investment Class may pay up to a 0.50% maximum annual rate of the Private
Investment Class' average daily net assets. Of this amount, the Fund may pay an
asset-based sales charge to FMC and the Fund may pay a service fee of 0.25% of
the average daily net assets of the Private Investment Class to selected
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. 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 Fund with respect to the Private Investment Class. During
the six months ended September 30, 1995, the Private Investment Class paid
$38,288 as compensation under the Plan.
The Fund, pursuant to the Company's master investment advisory agreement with
AIM, has agreed to reimburse AIM for certain costs incurred in providing
accounting services to the Fund. During the six months ended September 30,
1995, the Fund reimbursed AIM $40,080 for such services. Effective July 1,
1995, A I M Institutional Fund Services, Inc. ("AIFS") became the exclusive
transfer agent of the Fund and was paid $702 for transfer agency services
during the three months ended September 30, 1995. Certain officers and
directors of the Company are directors or officers of AIM, AIFS and FMC.
During the six months ended September 30, 1995, the Fund paid legal fees of
$3,287 for services rendered by Kramer, Levin, Naftalis, Nessen, Kamin &
Frankel as counsel to the Board of Directors. A member of that firm is a
director of the Company.
NOTE 3 - DIRECTORS' FEES
Directors' fees represent remuneration paid or accrued to each director who is
not an "interested person" of AIM. The Company may invest directors' fees, if
so elected by a director, in mutual fund shares in accordance with a deferred
compensation plan.
25
<PAGE>
NOTE 4 - CAPITAL STOCK
Changes in capital stock outstanding during the six months ended September 30,
1995 and the year ended March 31, 1995 were as follows:
<TABLE>
<CAPTION>
SEPTEMBER 30, 1995 MARCH 31, 1995
------------------------------- -------------------------------
SHARES AMOUNT SHARES AMOUNT
-------------- --------------- -------------- ---------------
<S> <C> <C> <C> <C>
Sold:
Institutional Shares 2,425,529,004 $ 2,425,529,004 5,223,878,446 $ 5,223,878,446
- -----------------------------------------------------------------------------------------
Private Investment
Class 122,611,772 122,611,772 147,139,503 147,139,503
- -----------------------------------------------------------------------------------------
Issued as reinvestment
of dividends:
Institutional Shares 47,873 47,873 74,376 74,376
- -----------------------------------------------------------------------------------------
Private Investment
Class 478,690 478,690 600,786 600,786
- -----------------------------------------------------------------------------------------
Redeemed:
Institutional Shares (2,411,355,283) (2,411,355,283) (5,254,269,516) (5,254,269,516)
- -----------------------------------------------------------------------------------------
Private Investment
Class (118,378,475) (118,378,475) (135,044,533) (135,044,533)
- -----------------------------------------------------------------------------------------
Net increase
(decrease) 18,933,581 $ 18,933,581 (17,620,938) $ (17,620,938)
=========================================================================================
</TABLE>
NOTE 5 - FINANCIAL HIGHLIGHTS
Shown below are the condensed financial highlights for a share of the
Institutional Shares outstanding during the six months ended September 30,
1995, each of the years in the six-year period ended March 31, 1995, the eleven
months ended March 31, 1989 and each of the years in the two-year period ended
April 30, 1988.
<TABLE>
<CAPTION>
SEPTEMBER 30,
1995
-------------
<S> <C>
Net asset value,
beginning of
period $1.00
- ---------------- ----------
Income from
investment
operations:
Net investment
income 0.02
- ---------------- ----------
Less
distributions:
Dividends from
net investment
income (0.02)
- ---------------- ----------
Net asset value,
end of period $1.00
================ ==========
Total return 3.76%(a)
================ ==========
Ratios/supplemental
data:
Net assets, end
of period (000s
omitted) $1,024,141
================ ==========
Ratio of
expenses to
average net
assets 0.20%(b)(c)
================ ==========
Ratio of net
investment
income to
average net
assets 3.72%(b)(c)
================ ==========
</TABLE>
<TABLE>
<CAPTION>
MARCH 31, APRIL 30,
-------------------------------------------------------------------------------- --------------------
1995 1994 1993 1992 1991 1990 1989 1988 1987
---------- ---------- -------- ---------- ---------- ---------- ---------- ---------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of
period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
- ------------------- ---------- ---------- -------- ---------- ---------- ---------- ---------- ---------- --------
Income from
investment
operations:
Net investment
income 0.03 0.02 0.03 0.04 0.06 0.06 0.05 0.04 0.04
- ------------------- ---------- ---------- -------- ---------- ---------- ---------- ---------- ---------- --------
Less
distributions:
Dividends from
net investment
income (0.03) (0.02) (0.03) (0.04) (0.06) (0.06) (0.05) (0.04) (0.04)
- ------------------- ---------- ---------- -------- ---------- ---------- ---------- ---------- ---------- --------
Net asset value,
end of period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
=================== ========== ========== ======== ========== ========== ========== ========== ========== ========
Total return 3.06% 2.33% 2.66% 4.09% 5.68% 6.22% 5.67%(a) 4.56% 4.24%
=================== ========== ========== ======== ========== ========== ========== ========== ========== ========
Ratios/supplemental
data:
Net assets, end
of period (000s
omitted) $1,009,891 $1,040,595 $994,828 $1,191,209 $1,156,557 $1,114,813 $1,062,479 $1,192,604 $993,392
=================== ========== ========== ======== ========== ========== ========== ========== ========== ========
Ratio of
expenses to
average net
assets 0.20%(b) 0.20%(b) 0.20%(b) 0.20%(b) 0.20%(b) 0.20%(b) 0.20%(a)(b) 0.21%(b) 0.21%(d)
=================== ========== ========== ======== ========== ========== ========== =========== ========== ========
Ratio of net
investment
income to
average net
assets 3.01%(b) 2.30%(b) 2.66%(b) 4.00%(b) 5.52%(b) 6.03%(b) 5.52%(a)(b) 4.47%(b) 4.14%(d)
=================== ========== ========== ======== ========== ========== ========== ========== ========== ========
</TABLE>
(a)Annualized.
(b)After waiver of advisory fees.
(c) Ratios are annualized and based on average net assets of $1,092,951,640.
Annualized ratios of expenses and net investment income to average net
assets prior to waiver of advisory fees are 0.26% and 3.66%, respectively.
(d)After waiver of advisory fees and distribution fees.
26
<PAGE>
This page intentionally left blank
27
<PAGE>
<TABLE>
<S> <C> <C> <C>
DIRECTORS
Charles T. Bauer John F. Kroeger
Bruce L. Crockett Lewis F. Pennock TAX-FREE
Owen Daly II Ian W. Robinson INVESTMENTS CO.
Carl Frischling Louis S. Sklar (TFIC)
Robert H. Graham
OFFICERS
Charles T. Bauer Chairman
Robert H. Graham President
John J. Arthur Sr. Vice President & Treasurer
Gary T. Crum Sr. Vice President
Carol F. Relihan Vice President & Secretary
Stuart W. Coco Vice President
Melville B. Cox Vice President Cash Reserve
Karen Dunn Kelley Vice President Portfolio
J. Abbott Sprague Vice President -------------------------------------------------------
Dana R. Sutton Vice President & Assistant Treasurer Institutional Cash SEMI-
P. Michelle Grace Assistant Secretary Reserve Shares ANNUAL
Nancy L. Martin Assistant Secretary REPORT
Ofelia M. Mayo Assistant Secretary
Kathleen J. Pflueger Assistant Secretary
Samuel D. Sirko Assistant Secretary
Stephen I. Winer Assistant Secretary
INVESTMENT ADVISOR
A I M Advisors, Inc.
11 Greenway Plaza, Suite 1919
Houston, TX 77046
(800) 347-1919
DISTRIBUTOR
Fund Management Company
11 Greenway Plaza, Suite 1919
Houston, TX 77046
(800) 659-1005
CUSTODIAN SEPTEMBER 30, 1995
The Bank of New York
110 Washington Street
New York, NY 10286
LEGAL COUNSEL TO FUND
Ballard Spahr Andrews & Ingersoll
1735 Market Street, 51st Floor
Philadelphia, PA 19103-7599
LEGAL COUNSEL TO DIRECTORS
Kramer, Levin, Naftalis, Nessen, Kamin & Frankel
919 Third Avenue
New York, N.Y. 10022
TRANSFER AGENT
A I M Institutional Fund Services, Inc.
11 Greenway Plaza, Suite 1919
Houston, TX 77046
This report may be distributed only to current shareholders or [LOGO APPEARS HERE]
to persons who have received a current Fund prospectus. Fund Management Company
</TABLE>
