The Corporate Fund Accumulation Program, Inc.
Annual Report
December 31, 1993
This report is not authorized for use as an offer of sale or a
solicitation of an offer to buy shares of the Program unless
accompanied or preceded by the Program's current prospectus.
Past performance results shown in this report should not be
considered a representation of future performance. Investment
return and principal value of shares will fluctuate so that
shares, when redeemed, may be worth more or less than their
original cost.
The Corporate Fund
Accumulation Program, Inc.
Box 9011
Princeton, NJ 08543-9011
To Our Shareholders:
For the year ended December 31, 1993, The Corporate Fund
Accumulation Program, Inc. provided a total investment return of
+12.20%, based on a change in per share net asset value from
$21.22 to $21.55, and assuming reinvestment of $1.688 per share
income dividends and $0.528 per share capital gains
distributions.
For the six-month period ended December 31, 1993, The Corporate
Fund Accumulation Program, Inc. provided a total investment
return of +3.37%, based on a change in per share net asset value
from $22.37 to $21.55, and assuming reinvestment of $1.076 per
share income dividends and $0.498 per share capital gains
distributions.
<PAGE>
The Environment
After a disappointing start in the first quarter of 1993, the
domestic economy began to show signs of increasing activity for
the balance of the year. This could be measured in the pattern of
increases in gross domestic product from 0.80% in the first
quarter, 1.90% in the second quarter, to 2.90% in the third
quarter. The fourth quarter results climbed to 5.90%. This
decidedly upbeat tone was evidenced by a jump in new home sales
and an increase in automobile sales and durable goods orders. The
lowest mortgage rates in well over a decade encouraged new buyers
into the market as affordability improved. The pent-up demand of
buyers who were shut out of the housing market by rapid price
increases in the 1980s helped boost demand. Auto sales continued
to improve, based on many factors, including the low interest
rates, improved consumer confidence and the yen/dollar exchange
rate.
Generally a pickup in economic growth is accompanied by a
commensurate increase in the rate of inflation. This expectation
led to an uptick in interest rates in the fourth quarter.
Inflation did not keep pace with the economy, however. The
underlying rate of inflation was 3.2%, the smallest annual
increase in 20 years. Faster economic growth translates into
higher inflation only when the economy is operating at close to
potential output, and these conditions are not currently being
met.
Fiscal Year in Review
During the second quarter of 1993, we extended the average
maturity of the portfolio from 9.8 years to 10.4 years. This
enabled us to participate in the bond rally which occurred during
the period. In anticipation of the rise in interest rates which
began in the fourth quarter, we assumed a more defensive posture
in our investment strategy. At year-end we shortened the average
portfolio maturity from 10.4 years to 9.4 years and built the
cash position up from a low of 2.5% to 7.6%. We believe that the
change in regulations in the electric utility industry will
result in increased competition and difficulty for a number of
companies. We reduced our exposure to this industry as well as
that of the telephone industry. Because we believed that the low
interest rate environment would help companies in the banking and
brokerage industries, we added to these sectors. We also
increased holdings in US dollar-denominated foreign securities
and in supranational issues. The unmanaged Merrill Lynch
Corporate Master Index showed a return of +12.43% for the year.
The Corporate Fund Accumulation Program, Inc. had a total return
of +12.20% for the same period.
<PAGE>
We appreciate your ongoing interest in The Corporate Fund
Accumulation Program, Inc., and we look forward to sharing our
investment strategy with you in our upcoming semi-annual report
to shareholders.
Sincerely,
(Arthur Zeikel)
Arthur Zeikel
President
(Jay C. Harbeck)
Jay C. Harbeck
Vice President and Portfolio Manager
February 4, 1994
Important Tax Information
The Corporate Fund Accumulation Program, Inc. declared the
following long-term capital gains distributions during the
taxable year ended December 31, 1993:
Long-Term Capital
Gains Distributions
Record Date Payable Date Per Share
04/14/93 04/15/93 $.029878
12/30/93 12/31/93 $.497941
Please retain this information for your records.
The Corporate Fund Accumulation Program, Inc.
Total Return Based on a $10,000 Investment
GRAPHIC MATERIAL APPEARS HERE. SEE APPENDIX: ITEM 1.
<TABLE>
The Corporate Fund Accumulation Program, Inc.
Schedule of Investments December 31, 1993
<CAPTION>
S&P Moody's Face Value
Rating Rating Amount Issue Cost (Note 1a)
<S> <S> <C> <S> <C> <C>
US Government Obligations
US Government Obligations--7.7%
US Treasury Notes:
NR Aaa $1,500,000 8.25% due 7/15/1998 $ 1,687,080 $ 1,687,965
NR Aaa 1,000,000 5.125% due 11/30/1998 1,004,521 996,870
NR Aaa 3,500,000 8.75% due 8/15/2000 4,151,436 4,131,085
NR Aaa 1,000,000 5.75% due 8/15/2003 995,843 996,560
NR Aaa 1,000,000 7.125% due 2/15/2023 1,128,449 1,082,180
------------ ------------
8,967,329 8,894,660
Total US Government Obligations--7.7% 8,967,329 8,894,660
<PAGE>
Industry Corporate Bonds & Notes
Banks & Thrifts--14.9%
A- A3 1,000,000 Boatmen's Bancshares, 6.75% due 3/15/2003 1,005,479 1,016,480
First Union Corporation:
A- A3 1,000,000 6.75% due 1/15/1998 997,632 1,039,425
A- A3 465,000 8.125% due 6/24/2002 522,876 515,898
A- A3 3,000,000 Huntington Bancshares, 7.625% due 1/15/2003 3,058,943 3,225,483
BBB+ A3 2,000,000 Meridian Bancorp, 6.625% due 3/15/2003 1,968,761 2,012,046
A- A3 3,000,000 Nationsbank Corp., 6.875% due 2/15/2005 3,159,472 3,057,783
A A2 3,000,000 Norwest Corp., 6.625% due 3/15/2003 3,016,120 3,053,286
A- Baa1 2,000,000 U.S.Bancorp, 7.00% due 3/15/2003 1,995,397 2,068,048
A A2 1,000,000 World Savings & Loan Association, 9.90% due 7/01/2000 1,028,795 1,175,305
------------ ------------
16,753,475 17,163,754
Financial--Other--6.5%
A A2 3,000,000 Bear Stearns, 6.70% due 8/01/2003 2,985,929 3,002,874
A A3 1,000,000 Dean Witter & Discover, 6.875% due 3/01/2003 1,021,981 1,022,468
BBB+ A3 2,000,000 PaineWebber, 9.25% due 12/15/2001 2,324,501 2,310,640
A+ A3 1,000,000 Torchmark Corp., 9.625% due 5/01/1998 989,782 1,149,771
------------ ------------
7,322,193 7,485,753
Financial Services--2.8%
A+ A1 2,000,000 American General Finance Corp., 7.45% due 7/01/2002 2,044,003 2,143,340
AA- A1 1,000,000 Associates Corp. of North America, 8.80% due 8/01/1998 1,126,319 1,127,835
------------ ------------
3,170,322 3,271,175
Financial Services--Captive--0.9%
A A2 1,000,000 Ford Motor Credit Co., 7.75% due 11/15/2002 996,668 1,092,128
Foreign*--3.5%
A+ A1 1,000,000 Hydro-Quebec (Canada), 8.40% due 1/15/2022 (a) 1,117,704 1,116,178
A+ A1 1,000,000 Korea Development Bank, 7.90% due 2/01/2002 (b) 1,090,205 1,077,001
A+ A1 750,000 Korea Electric Power, 7.75% due 4/01/2013 (c) 767,567 767,260
AA- Aa2 1,000,000 Province of Ontario (Canada), 8.00% due 10/17/2001 (d) 1,074,585 1,101,830
------------ ------------
4,050,061 4,062,269
</TABLE>
<PAGE>
<TABLE>
The Corporate Fund Accumulation Program, Inc.
Schedule of Investments (continued) December 31, 1993
<CAPTION>
S&P Moody's Face Value
Rating Rating Amount Issue Cost (Note 1a)
<S> <S> <C> <S> <C> <C>
Corporate Bonds & Notes (continued)
Industrial--Consumer--8.2%
A+ A1 $2,000,000 Bass America Inc., 8.125% due 3/31/2002 $ 2,068,822 $ 2,212,132
Dillard Department Stores, Inc.:
A+ A2 1,000,000 7.375% due 6/15/1999 1,027,035 1,074,679
A+ A2 1,000,000 7.85% due 10/01/2012 1,033,359 1,080,109
Grand Metropolitan Investment Corp.:
A+ A2 2,000,000 8.625% due 8/15/2001 2,066,097 2,297,066
A+ A2 1,000,000 9.00% due 8/15/2011 1,028,110 1,188,715
Philip Morris Companies, Inc.:
A A2 500,000 9.00% due 1/01/2001 504,319 576,517
A A2 1,000,000 7.25% due 1/15/2003 995,235 1,051,137
------------ ------------
8,722,977 9,480,355
Industrial--Energy--4.9%
A+ A1 1,000,000 Atlantic Richfield Co., 10.375% due 7/15/1995 1,004,722 1,089,014
AA- A1 1,000,000 BP America Inc., 7.875% due 5/15/2002 1,050,043 1,103,545
A- A3 2,000,000 Burlington Resources, Inc., 9.625% due 6/15/2000 2,343,664 2,384,948
A+ A1 1,000,000 Texaco Capital, 8.00% due 8/01/2032 970,801 1,098,391
------------ ------------
5,369,230 5,675,898
Industrial--Other--15.2%
AA- Aa2 2,000,000 Archer-Daniels-Midland Co., 6.25% due 5/15/2003 1,989,696 2,018,972
A- A3 1,000,000 Baxter International Inc., 8.125% due 11/15/2001 993,788 1,108,899
A+ A1 3,000,000 Capital Cities/ABC Inc., 8.875% due 12/15/2000 3,171,850 3,504,432
A A2 1,000,000 Communication Satellite, 8.125% due 4/01/2004 1,021,030 1,120,786
A A3 3,000,000 First Data Corp., 6.625% due 4/01/2003 2,994,743 3,040,752
A A2 1,000,000 Ford Capital B.V., 9.875% due 5/15/2002 1,021,129 1,217,962
AAA Aaa 2,000,000 United Parcel Service of America, Inc.,
8.375% due 4/01/2020 1,917,142 2,366,062
A A2 3,000,000 Weyerhaeuser Corp., 7.50% due 3/01/2013 3,170,223 3,151,764
------------ ------------
16,279,601 17,529,629
Supranational--2.5%
AAA Aaa 2,000,000 International Bank for Reconstruction & Development,
12.375% due 10/15/2002 2,018,251 2,824,686
Transportation--3.5%
Southwest Airlines Co.:
A- Baa1 2,500,000 9.40% due 7/01/2001 2,999,481 2,938,075
A- Baa1 1,000,000 7.875% due 9/01/2007 993,247 1,084,569
------------ ------------
3,992,728 4,022,644
<PAGE>
Utilities--Communications--5.9%
BBB+ A3 500,000 GTE Corporation, 9.10% due 6/01/2003 565,820 590,020
Pacific Bell, Inc.:
AA- Aa3 1,000,000 8.70% due 6/15/2001 992,172 1,156,801
AA- Aa3 1,000,000 7.25% due 7/01/2002 1,051,180 1,068,719
AA- Aa3 1,000,000 7.125% due 3/15/2026 1,021,789 999,892
Southwestern Bell Telecommunications, Inc.:
A+ A1 2,000,000 6.125% due 3/01/2000 2,009,015 2,030,544
A+ A1 1,000,000 7.00% due 7/01/2015 987,785 1,006,824
------------ ------------
6,627,761 6,852,800
</TABLE>
<TABLE>
The Corporate Fund Accumulation Program, Inc.
Schedule of Investments (concluded) December 31, 1993
<CAPTION>
S&P Moody's Face Value
Rating Rating Amount Issue Cost (Note 1a)
<S> <S> <C> <S> <C> <C>
Corporate Bonds & Notes (concluded)
Utilities--Electric--10.7%
A- A3 $3,000,000 Georgia Power Co., 6.125% due 9/01/1999 $ 2,967,235 $ 3,044,517
Pacific Gas & Electric Co.:
A A1 1,000,000 7.875% due 3/01/2002 998,303 1,101,170
A A1 2,000,000 6.25% due 8/01/2003 1,997,937 1,980,616
A A1 1,000,000 7.25% due 8/01/2026 1,011,246 986,934
Pennsylvania Power & Light Co.:
A A2 1,000,000 7.75% due 5/01/2002 1,039,328 1,092,055
A A2 2,000,000 6.875% due 2/01/2003 1,990,276 2,066,574
A A2 2,000,000 Virginia Electric & Power Co., 6.625% due 4/01/2003 2,008,726 2,047,952
------------ ------------
12,013,051 12,319,818
Utilities--Gas--1.7%
AA- A1 2,000,000 Consolidated Natural Gas Co., 5.75% due 8/01/2003 1,982,578 1,931,294
Total Corporate Bonds & Notes--81.2% 89,298,896 93,712,203
<CAPTION>
Short-Term Securities
<S> <C> <S> <C> <C>
Commercial Paper**--3.1%
General Electric Capital Corp.:
1,000,000 3.40% due 1/04/1994 999,717 999,717
2,527,000 3.20% due 1/07/1994 2,525,652 2,525,652
------------ ------------
3,525,369 3,525,369
Repurchase Agreements***--6.8%
3,856,000 Bankers Trust, purchased on 12/31/1993 to yield 3.25% to 1/03/1994 3,856,000 3,856,000
4,000,000 Goldman Sachs & Co., purchased on 12/31/1993 to yield
2.75% to 1/03/1994 4,000,000 4,000,000
------------ ------------
7,856,000 7,856,000
Total Short-Term Securities--9.9% 11,381,369 11,381,369
Total Investments--98.8% $109,647,594 113,988,232
============
Other Assets Less Liabilities--1.2% 1,378,883
------------
Net Assets--100.0% $115,367,115
============
<FN>
*Corresponding industry groups for foreign bonds which are denominated in US dollars:
(a) Utility--Electric; Owned & Guaranteed by the Province.
(b) Financial Institution; Government-Owned & Guaranteed by Korea.
(c) Utility--Electric; Majority-owned, not guaranteed by the Republic of Korea.
(d) Government entity.
**Commercial Paper is traded on a discount basis; the interest rates shown are the
discount rates paid at the time of purchase by the Program.
***Repurchase Agreements are fully collateralized by US Government Obligations.
Ratings of issues shown have not been audited by Deloitte & Touche.
See Notes to Financial Statements.
</TABLE>
<TABLE>
The Corporate Fund Accumulation Program, Inc.
Statement of Assets and Liabilities as of December 31, 1993
<CAPTION>
<S> <C> <C>
Assets:
Investments, at value (identified cost--$109,647,594) (Note 1a) $113,988,232
Cash 1,333
Receivables:
Interest $ 2,134,546
Capital shares sold 13,722 2,148,268
------------
Prepaid registration fees and other assets (Note 1d) 17,815
------------
Total assets 116,155,648
------------
<PAGE>
Liabilities:
Payables:
Dividends to shareholders (Note 1e) 384,191
Capital shares redeemed 206,065
Investment adviser (Note 2) 46,466 636,722
------------
Accrued expenses and other liabilities 151,811
------------
Total liabilities 788,533
------------
Net Assets $115,367,115
============
Net Assets Consist of:
Common Stock, $.01 par value, 50,000,000 shares authorized $ 53,529
Paid-in capital in excess of par 110,956,139
Undistributed investment income--net 17,696
Accumulated realized capital losses--net (887)
Unrealized appreciation on investments--net 4,340,638
------------
Net Assets--Equivalent to $21.55 net asset value per share based on 5,352,963 shares outstanding $115,367,115
============
</TABLE>
<TABLE>
The Corporate Fund Accumulation Program, Inc.
Statement of Operations for the Year Ended December 31, 1993
<CAPTION>
<S> <C> <C>
Investment Income (Note 1c):
Interest and premium and discount earned $ 7,036,061
Expenses:
Investment advisory fees (Note 2) $ 515,901
Transfer agent fees 337,249
Printing and shareholder reports 73,738
Professional fees 46,975
Registration fees (Note 1d) 43,736
Accounting services (Note 2) 35,280
Pricing fees 24,269
Custodian fees 19,849
Directors' fees and expenses 12,920
Other 3,654
------------
Total expenses 1,113,571
------------
Investment income--net 5,922,490
Realized & Unrealized Gain on Investments--Net (Notes 1c & 3):
Realized gain on investments--net 4,633,533
Change in unrealized appreciation on investments--net 915,986
------------
Net Increase in Net Assets Resulting from Operations $ 11,472,009
============
See Notes to Financial Statements.
</TABLE>
<PAGE>
<TABLE>
The Corporate Fund Accumulation Program, Inc.
Statements of Changes in Net Assets
<CAPTION>
For the Year Ended December 31,
Increase (Decrease) in Net Assets: 1993 1992
<S> <C> <C>
Operations:
Investment income--net $ 5,922,490 $ 5,784,730
Realized gain on investments--net 4,633,533 2,082,581
Change in unrealized appreciation/depreciation on investments--net 915,986 (2,058,824)
------------ ------------
Net increase in net assets resulting from operations 11,472,009 5,808,487
------------ ------------
Dividends & Distributions to Shareholders (Note 1e):
Investment income--net (5,905,595) (5,808,866)
Realized gain on investments--net (4,763,714) (2,088,612)
------------ ------------
Net decrease in net assets resulting from dividends and distributions to shareholders (10,669,309) (7,897,478)
------------ ------------
Capital Share Transactions (Note 4):
Net increase in net assets derived from capital share transactions 23,672,843 10,317,708
------------ ------------
Net Assets:
Total increase in net assets 24,475,543 8,228,717
Beginning of year 90,891,572 82,662,855
------------ ------------
End of year* $115,367,115 $ 90,891,572
============ ============
<FN>
*Undistributed investment income--net $ 17,696 $ 801
============ ============
</TABLE>
<TABLE>
The Corporate Fund Accumulation Program, Inc.
Financial Highlights
<CAPTION>
The following per share data and ratios have been derived For the Year Ended December 31,
from information provided in the financial statements. 1993 1992 1991 1990 1989
<S> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of year $ 21.22 $ 21.76 $ 20.24 $ 20.54 $ 19.75
-------- -------- -------- -------- --------
Investment income--net 1.31 1.46 1.52 1.67 1.64
Realized and unrealized gain (loss) on investments--net 1.24 (.03) 1.51 (.28) .81
-------- -------- -------- -------- --------
Total from investment operations 2.55 1.43 3.03 1.39 2.45
-------- -------- -------- -------- --------
Less dividends and distributions:
Investment income--net (1.29) (1.47) (1.51) (1.69) (1.66)
Realized gain on investments--net (.93) (.50) -- -- --
-------- -------- -------- -------- --------
Total dividends and distributions (2.22) (1.97) (1.51) (1.69) (1.66)
-------- -------- -------- -------- --------
Net asset value, end of year $ 21.55 $ 21.22 $ 21.76 $ 20.24 $ 20.54
======== ======== ======== ======== ========
Total Investment Return:
Based on net asset value per share 12.20% 6.88% 15.60% 7.19% 12.87%
======== ======== ======== ======== ========
Ratios to Average Net Assets:
Expenses 1.08% 1.12% 1.16% 1.29% 1.26%
======== ======== ======== ======== ========
Investment income--net 5.74% 6.72% 7.25% 8.18% 8.27%
======== ======== ======== ======== ========
Supplemental Data:
Net assets, end of year (in thousands) $115,367 $ 90,892 $ 82,663 $ 76,298 $ 82,738
======== ======== ======== ======== ========
Portfolio turnover 132% 65% 87% 107% 126%
======== ======== ======== ======== ========
See Notes to Financial Statements.
</TABLE>
<PAGE>
The Corporate Fund Accumulation Program, Inc.
Notes to Financial Statements
1. Significant Accounting Policies:
The Corporate Fund Accumulation Program, Inc. (the "Program") is
registered under the Investment Company Act of 1940 as a
diversified, open-end investment management company. The
following is a summary of significant accounting policies
followed by the Program.
(a) Valuation of securities--Portfolio securities are valued by
the Program's pricing agent, Interactive Data Services, Inc.
These values are not bids or actual last sale prices but are
estimates of the price at which the pricing agent believes the
Program could sell such portfolio securities. The Board of
Directors has examined the methods to be used by the Program's
pricing agent in estimating the value of portfolio securities and
believes that such methods will reasonably and fairly approximate
the price at which portfolio securities may be sold and will
result in a good faith determination of the fair value of such
securities. Short-term securities are valued at amortized cost,
which approximates market.
(b) Income taxes--It is the Program's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute substantially all of its
taxable income to its shareholders. Therefore, no Federal income
tax provision is required.
(c) Security transactions and investment income--Security
transactions are recorded on the dates the transactions are
entered into (the trade dates). Interest income (including
amortization of premium and discount) is recognized on the
accrual basis. Realized gains and losses on security transactions
are determined on the identified cost basis.
(d) Prepaid registration fees--Prepaid registration fees are
charged to expense as the related shares are issued.
(e) Dividends to shareholders--Dividends from net investment
income are declared and paid monthly. Distributions of capital
gains are recorded on the ex-dividend dates.
2. Investment Advisory Agreement and Transactions with
Affiliates:
The Program has entered into an Investment Advisory Agreement
with Fund Asset Management, Inc. ("FAMI"), a wholly-owned
subsidiary of Merrill Lynch Investment Management, Inc. ("MLIM"),
which is an indirect, wholly-owned subsidiary of Merrill Lynch &
Co., Inc.
<PAGE>
Effective January 1, 1994, the investment advisory business of
FAMI reorganized from a corporation to a limited partnership. The
general partner of FAMI is Princeton Services, Inc., an indirect
wholly-owned subsidiary of Merrill Lynch & Co.
FAMI is responsible for the management of the Program's portfolio
and provides the necessary personnel, facilities, equipment and
certain other services necessary to the operations of the
Program. For such services, the Program pays a monthly fee of
0.50%, on an annual basis, of the value of the Program's average
daily net assets. The Investment Advisory Agreement obligates
FAMI to reimburse the Program to the extent the Program's
expenses (excluding interest, taxes, brokerage fees and
extraordinary items) exceed 2.5% of the Program's first $30
million of average daily net assets, 2.0% in excess of $30
million but not exceeding $100 million average daily net assets,
and 1.5% of the average daily net assets above $100 million. No
fee payment will be made to the Adviser during any fiscal year
which would cause such expenses to exceed the foregoing expense
limitations applicable at the time of such payment.
FAMI has entered into an Administrative Agreement with Merrill
Lynch, Pierce, Fenner & Smith Inc. ("MLPF&S"), Prudential
Securities, Inc., Dean Witter Reynolds Inc., and Shearson Lehman
Brothers Inc. (the "Administrators"), whereby the Administrators
perform certain administrative duties on behalf of FAMI.
The Administrators receive a monthly fee from FAMI equal to
0.20%, on an annual basis, of the Program's average daily net
assets and have agreed to reimburse FAMI for a portion of the
reimbursement of expenses to the Program as described above,
required to be made by FAMI.
Accounting services are provided to the Program by FAMI at cost.
Certain officers and/or directors of the Program are officers
and/or directors of FAMI, MLIM, MLPF&S, and/or Merrill Lynch &
Co., Inc.
3. Investments:
Purchases and sales of investments, excluding short-term
securities, for the year ended December 31, 1993 were
$144,268,311 and $129,547,172, respectively.
Net realized and unrealized gains (losses) as of December 31,
1993 were as follows:
Realized
Gains Unrealized
(Losses) Gains
Corporate & Government Bonds $ 4,633,650 $ 4,340,638
Short-Term Securities (117) --
----------- -----------
Total $ 4,633,533 $ 4,340,638
=========== ===========
<PAGE>
As of December 31, 1993, net unrealized appreciation for Federal
income tax purposes aggregated $4,340,638, of which $4,747,154
related to appreciated securities and $406,516 related to
depreciated securities. The aggregate cost of investments at
December 31, 1993 for Federal income tax purposes was
$109,647,594.
4. Capital Share Transactions:
Transactions in capital shares were as follows:
For the Year Ended Dollar
December 31, 1993 Shares Amount
Shares sold 3,558,780 $79,734,098
Shares issued to shareholders
in reinvestment of dividends and
distributions 458,843 10,088,643
----------- -----------
Total issued 4,017,624 89,822,741
Shares redeemed (2,948,852) (66,149,898)
----------- -----------
Net increase 1,068,771 $23,672,843
=========== ===========
For the Year Ended Dollar
December 31, 1992 Shares Amount
Shares sold 1,792,821 $38,606,717
Shares issued to shareholders
in reinvestment of dividends and
distributions 356,943 7,652,995
----------- -----------
Total issued 2,149,764 46,259,712
Shares redeemed (1,663,828) (35,942,004)
----------- -----------
Net increase 485,936 $10,317,708
=========== ===========
Paid-in capital was decreased by $74,402 as a result of prior
years' permanent tax differences.
<PAGE>
<AUDIT-REPORT>
The Corporate Fund Accumulation Program, Inc.
Independent Auditors' Report
The Board of Directors and Shareholders, The Corporate Fund
Accumulation Program, Inc.:
We have audited the accompanying statement of assets and
liabilities, including the schedule of investments, of The
Corporate Fund Accumulation Program, Inc. as of December 31,
1993, the related statements of operations for the year then
ended and changes in net assets for each of the years in the
two-year period then ended, and financial highlights for each
of the years in the five-year period then ended. These financial
statements and the financial highlights are the responsibility
of the Program's management. Our responsibility is to express
an opinion on these financial statements and the 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 the 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 at December 31, 1993 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, such financial statements and financial
highlights present fairly, in all material respects, the
financial position of The Corporate Fund Accumulation Program,
Inc. as of December 31, 1993, the results of its operations, the
changes in its net assets, and the financial highlights for the
respective stated periods in conformity with generally accepted
accounting principles.
Deloitte & Touche
Princeton, New Jersey
February 4, 1994
</AUDIT-REPORT>
Officers and Directors
Arthur Zeikel--President and Director
Ronald W. Forbes--Director
Charles C. Reilly--Director
Kevin A. Ryan--Director
Richard R. West--Director
Marc A. White--Director
Terry K. Glenn--Executive Vice President
N. John Hewitt--Senior Vice President
Donald C. Burke--Vice President
Jay C. Harbeck--Vice President
Gerald M. Richard--Treasurer
Susan B. Baker--Secretary
<PAGE>
Custodian and Transfer Agent
The Bank of New York
110 Washington Street
New York, New York 10286
APPENDIX GRAPHIC AND IMAGE MATERIAL. ITEM 1.
The Corporate Fund Accumulation Program, Inc.
Total Return Based on a $10,000 Investment
A line graph depicting the growth of an investment in the Program
compared to growth of an investment in the ML COAO Corporate
Master Bond Index. Beginning and ending values are:
12/83 12/31/93
The Corporate Fund Accumulation
Program, Inc.*++ $10,000 $28,489
ML COAO Corporate Master
Bond Index++++ $10,000 $33,658
[FN]
*Assuming transaction costs and other operating expenses,
including advisory fees.
++The Corporate Fund Investment Accumulation Program, Inc.
invests in long- and intermediate-term fixed-interest bearing
debt obligations issued primarily by corporations.
++++This unmanaged Index is comprised of all industrial bonds
rated BBB3 or higher, of all maturities.
Past performance is not predictive of future performance.
