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Alliance
Money
Reserves
Alliance Capital [LOGO](R)
Annual Report
June 30, 1999
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<PAGE>
STATEMENT OF NET ASSETS
June 30, 1999 Alliance Money Reserves
================================================================================
Principal
Amount
(000) Security(a) Yield Value
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CERTIFICATES OF
DEPOSIT -- 33.3%
Barclays Bank Plc
$ 20,000 4.91%, 6/14/00 (b) ..................... 4.96% $ 19,990,752
10,000 5.61%, 6/14/00 ......................... 5.66 9,995,417
Bayerische Landesbank
42,000 4.89%, 3/30/00 (b) ..................... 4.95 41,981,479
Canadian Imperial
Bank
15,000 5.10%, 9/15/99 ......................... 5.10 15,000,000
Cariplo NY
5,000 4.90%, 8/18/99 ......................... 4.89 5,000,066
Credit Communal
De Belgique
20,000 5.29%, 9/30/99 ......................... 5.29 20,000,000
Deutsche Bank
13,000 4.88%, 8/16/99 (b) ..................... 4.95 12,998,910
10,000 5.11%, 2/22/00 ......................... 5.16 9,997,821
20,000 5.44%, 6/01/00 ......................... 5.49 19,991,160
15,000 5.58%, 6/12/00 ......................... 5.63 14,995,897
Hessische Landesbank
15,000 5.22%, 2/29/00 ......................... 5.24 14,997,597
National Westminster
Bank
55,000 4.88%, 4/17/00 (b) ..................... 4.94 54,975,423
15,000 5.67%, 7/05/00 ......................... 5.72 14,994,175
Nordeutsche
Landesbank
15,000 5.05%, 2/14/00 ......................... 5.08 14,997,290
10,000 5.26%, 5/18/00 ......................... 5.30 9,996,605
10,000 5.66%, 7/27/99 ......................... 5.71 9,999,659
Rabo Bank
30,000 5.11%, 2/18/00 ......................... 5.16 29,994,487
18,000 5.65%, 7/26/99 ......................... 5.70 17,999,410
State Street Bank &
Trust Co.
25,000 4.95%, 9/13/99 ......................... 4.95 25,000,000
Toronto Dominion
Bank
25,000 4.81%, 8/09/99 (b) ..................... 4.87 24,998,435
15,000 5.07%, 2/17/00 ......................... 5.10 14,996,797
20,000 5.27%, 3/02/00 ......................... 5.30 19,996,025
UBS Finance Delaware,
Inc.
10,000 5.16%, 2/28/00 ......................... 5.19 9,998,085
10,000 5.22%, 5/10/00 ......................... 5.26 9,996,688
20,000 5.34%, 5/30/00 ......................... 5.39 19,991,207
5,000 5.36%, 5/30/00 ......................... 5.61 4,988,303
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Total Certificates of
Deposit
(amortized cost
$467,871,688) .......................... 467,871,688
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COMMERCIAL PAPER -- 28.4%
Associates Corp. of
North America
10,000 8/25/99 ................................ 5.14 9,921,472
BAA Plc
5,000 9/15/99 ................................ 4.84 4,948,911
Banc One Corp.
10,000 8/16/99 ................................ 5.03 9,935,728
Banco de Santander
P.R.
25,000 7/13/99 ................................ 4.82 24,959,833
12,504 9/14/99 ................................ 5.07 12,371,927
Bil North America, Inc.
5,000 8/10/99 ................................ 4.79 4,973,389
10,000 9/15/99 ................................ 4.82 9,898,244
7,500 7/20/99 ................................ 4.83 7,480,881
4,000 7/23/99 ................................ 4.83 3,988,194
CBA (Finance) Delaware,
Inc.
10,000 9/15/99 ................................ 4.84 9,897,822
CS First Boston,
Guernsey
15,000 9/09/99 (c) ............................ 4.87 14,857,958
10,000 8/20/99 (c) ............................ 5.06 9,929,722
Dresdner Bank
40,000 8/24/99 ................................ 5.14 39,691,600
First Chicago Financial
Corp.
15,000 7/14/99 ................................ 4.99 14,972,971
Ford Motor Credit
Corp.
30,000 7/01/99 ................................ 5.75 30,000,000
GE Capital
International Funding
10,000 8/24/99 ................................ 5.15 9,922,750
20,000 8/25/99 ................................ 5.22 19,840,500
1
<PAGE>
STATEMENT OF NET ASSETS (continued) Alliance Money Reserves
Principal
Amount
(000) Security(a) Yield Value
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Government
Development Bank of
Puerto Rico
$ 11,000 7/01/99 ................................ 5.00% $ 11,000,000
J.P. Morgan & Co., Inc.
15,000 9/15/99 ................................ 5.04 14,840,400
8,000 9/15/99 ................................ 5.05 7,914,711
National City Corp.
20,000 8/11/99 ................................ 5.18 19,882,011
12,000 8/13/99 ................................ 5.20 11,925,467
Park Avenue Receivables
Corp.
20,000 8/25/99 (c) ............................ 5.35 19,836,528
Shell Finance
22,800 8/10/99 ................................ 5.25 22,667,000
Societe Generale N.A.,
Inc.
10,000 8/25/99 ................................ 4.89 9,925,292
Thames Global Asset
Funding
10,000 9/15/99 (c) ............................ 5.10 9,892,333
UNI Funding, Inc.
35,000 7/15/99 ................................ 4.82 34,934,394
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Total Commercial Paper
(amortized cost
$400,410,038) .......................... 400,410,038
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CORPORATE
OBLIGATIONS -- 16.0%
Allstate Life Insurance
Funding Agreement
20,000 4.96%, 9/01/99 FRN (d) ................. 4.96 20,000,000
American General
Annuity Insurance Co.
Funding Agreement
5,000 4.95%, 9/01/99 (d) ..................... 4.95 5,000,000
General American
Funding Corp.
Funding Agreement
60,000 5.12%, 7/09/99 FRN ..................... 5.12 60,000,000
General Electric
Capital Corp.
20,000 4.95%, 4/12/00 FRN ..................... 4.95 20,000,000
J.P. Morgan & Co., Inc.
30,000 4.82%, 7/07/99 FRN ..................... 4.86 29,999,592
Merrill Lynch & Co., Inc.
5,000 5.09%, 2/07/00 MTN ..................... 5.09 5,000,000
10,000 5.33%, 9/30/99 FRN ..................... 5.33 10,000,000
Prudential of America
Insurance Co. Funding
Agreement
11,000 4.94%, 11/30/00 FRN .................... 4.94 11,000,000
Security Benefit Life
Insurance Co. Funding
Agreement
20,000 5.06%, 10/14/99 (d) .................... 5.06 20,000,000
Sigma Finance
15,000 5.00%, 9/15/99 FRN (c) ................. 5.00 15,000,000
20,000 5.20%, 6/30/00 FRN (c) ................. 5.20 20,000,000
Travelers Life
Funding Agreement
10,000 5.05%, 10/21/99 FRN (d) ................ 5.05 10,000,000
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Total Corporate
Obligations
(amortized cost
$225,999,592) .......................... 225,999,592
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BANK OBLIGATIONS -- 6.4%
Abbey National Treasury
Services
15,000 4.80%, 7/15/99 FRN ..................... 4.87 14,999,635
CS First Boston,
Guernsey
15,000 5.00%, 9/23/99 MTN (c) ................. 5.00 15,000,000
First National Bank
15,000 5.60%, 6/14/00 ......................... 5.65 14,993,124
Lasalle National Bank
15,000 4.95%, 8/19/99 ......................... 4.98 14,999,823
Royal Bank of Canada
30,000 5.44%, 8/25/99 FRN ..................... 5.52 29,996,465
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Total Bank Obligations
(amortized cost
$89,989,047) ........................... 89,989,047
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TIME DEPOSITS -- 5.7%
Republic National Bank
50,000 5.88%, 7/01/99 ......................... 5.88 50,000,000
Societe Generale Bank
20,000 6.00%, 7/01/99 ......................... 6.00 20,000,000
Westdeutsche
Landesbank
10,400 5.81%, 7/01/99 ......................... 5.81 10,400,000
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Total Time Deposits
(amortized cost
$80,400,000) ........................... 80,400,000
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2
<PAGE>
Alliance Money Reserves
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Principal
Amount
(000) Security(a) Yield Value
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U.S. GOVERNMENT
AGENCY OBLIGATIONS -- 5.7%
Federal Home Loan
Bank
$ 15,000 5.00%, 2/10/00 ......................... 5.00% $ 15,000,000
Student Loan
Marketing Assn.
10,000 5.56%, 11/24/99 FRN .................... 5.59 9,998,800
30,000 5.59%, 2/04/00 FRN ..................... 5.61 29,996,494
25,000 5.64%, 11/09/99 FRN .................... 5.70 24,994,706
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Total U.S. Government
Agency Obligations
(amortized cost
$79,990,000) ........................... 79,990,000
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PROMISSORY NOTES-5.0%
Goldman Sachs
Group LP
$ 15,000 4.98%, 8/02/99 (c) ..................... 4.98% $15,000,000
32,000 4.98%, 10/12/99 (c) .................... 4.98 32,000,000
23,000 5.03%, 11/19/99 (c) .................... 5.03 23,000,000
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Total Promissory Notes
(amortized cost
$70,000,000) ........................... 70,000,000
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TOTAL INVESTMENTS -- 100.5%
(amortized cost
$1,414,660,365) ........................ 1,414,660,365
Other assets less
liabilities-(0.5%) ..................... (7,271,464)
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NET ASSETS -- 100%
(offering and redemption
price of $1.00 per share;
1,408,575,936 shares
outstanding) ........................... $1,407,388,901
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(a) All securities either mature or their interest rate changes in 397 days or
less.
(b) Variable Rate Security. Stated interest rate in effect at June 30, 1999.
(c) Securities issued in reliance on section 4(2) or Rule 144A of the
Securities and Exchange Act of 1933. Rule 144A securities may be resold in
transactions exempt from registration, normally to qualified institutional
buyers. At June 30, 1999, these securities amounted to $174,516,541,
representing 12.4% of net assets.
(d) Funding Agreements which are illiquid securities and subject to
restrictions as to resale. These securities amounted to $55,000,000,
representing 3.9% of net assets (see Note A).
Glossary of Terms:
FRN Floating Rate Note
MTN Medium Term Note
See notes to financial statements.
3
<PAGE>
STATEMENT OF OPERATIONS
Year Ended June 30, 1999 Alliance Money Reserves
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<TABLE>
<S> <C> <C>
INVESTMENT INCOME
Interest ...................................................... $ 74,347,534
EXPENSES
Advisory fee (Note B) ......................................... $ 7,028,098
Distribution assistance and administrative service (Note C) ... 5,482,962
Transfer agency (Note B) ...................................... 860,826
Registration fees ............................................. 567,269
Custodian fees ................................................ 228,263
Printing ...................................................... 133,380
Audit and legal fees .......................................... 50,447
Trustees' fees ................................................ 10,370
Miscellaneous ................................................. 30,362
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Total expenses ................................................ 14,391,977
Less: expense reimbursement ................................... (304,024)
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Net expenses .................................................. 14,087,953
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Net investment income ......................................... 60,259,581
REALIZED GAIN ON INVESTMENTS
Net realized gain on investment transactions .................. 1,042
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NET INCREASE IN NET ASSETS FROM OPERATIONS ....................... $ 60,260,623
============
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
================================================================================
<TABLE>
<CAPTION>
Year Ended Year Ended
June 30, 1999 June 30, 1998
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<S> <C> <C>
INCREASE IN NET ASSETS FROM OPERATIONS
Net investment income .......................... $ 60,259,581 $ 53,704,005
Net realized gain on investment transactions ... 1,042 1,898
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Net increase in net assets from operations ..... 60,260,623 53,705,903
DIVIDENDS TO SHAREHOLDERS FROM:
Net investment income .......................... (60,259,581) (53,704,005)
TRANSACTIONS IN SHARES OF BENEFICIAL INTEREST
Net increase (Note E) .......................... 241,040,921 155,581,838
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Total increase ................................. 241,041,963 155,583,736
NET ASSETS
Beginning of year .............................. 1,166,346,938 1,010,763,202
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End of year .................................... $ 1,407,388,901 $ 1,166,346,938
=============== ===============
</TABLE>
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See notes to financial statements.
4
<PAGE>
NOTES TO FINANCIAL STATEMENTS
June 30, 1999 Alliance Money Reserves
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NOTE A: Significant Accounting Policies
Alliance Capital Reserves (the "Trust") is an open-end diversified investment
company registered under the Investment Company Act of 1940. The Trust consists
of two portfolios: Alliance Capital Reserves and Alliance Money Reserves (the
"Portfolio"), each of which is considered to be a separate entity for financial
reporting and tax purposes. The Portfolio pursues its objectives by maintaining
a portfolio of high-quality money market securities all of which, at the time of
investment, have remaining maturities of 397 days or less. The financial
statements have been prepared in conformity with generally accepted accounting
principles which require management to make certain estimates and assumptions
that affect the reported amounts of assets and liabilities in the financial
statements and amounts of income and expenses during the reporting period.
Actual results could differ from those estimates. The following is a summary of
significant accounting policies followed by the Portfolio.
1. Valuation of Securities
Securities in which the Portfolio invests are traded primarily in the
over-the-counter market and are valued at amortized cost, under which method a
portfolio instrument is valued at cost and any premium or discount is amortized
on a constant basis to maturity. Certain illiquid securities containing
unconditional puts at par value are also valued at amortized cost.
2. Taxes
It is the Portfolio's policy to meet the requirements of the Internal Revenue
Code applicable to regulated investment companies and to distribute all of its
investment company taxable income and net realized gains, if any, to its
shareholders. Therefore, no provisions for federal income or excise taxes are
required.
3. Dividends
The Portfolio declares dividends daily from net investment income and
automatically reinvests such dividends in additional shares at net asset value.
Net realized capital gains on investments, if any, are expected to be
distributed near year end.
4. Investment Income and Investment Transactions
Interest income is accrued as earned. Investment transactions are recorded on a
trade date basis. Realized gain (loss) from investment transactions is recorded
on the identified cost basis.
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NOTE B: Advisory Fee and Transactions with an Affiliate of the Adviser
The Portfolio pays its Adviser, Alliance Capital Management L.P., an advisory
fee at the annual rate of .50% on the first $1.25 billion of average daily net
assets; .49% on the next $.25 billion; .48% on the next $.25 billion; .47% on
the next $.25 billion; .46% on the next $1 billion; and .45% in excess of $3
billion. The Adviser has agreed, pursuant to the advisory agreement, to
reimburse the Portfolio to the extent that its annual aggregate expenses
(excluding taxes, broker age, interest and, where permitted, extraordinary
expenses) exceed 1% of its average daily net assets for any fiscal year. For the
year ended June 30, 1999, the reimbursement amounted to $304,024.
The Portfolio compensates Alliance Fund Services, Inc., a wholly-owned
subsidiary of the Adviser, under a Transfer Agency Agreement for providing
personnel and facilities to perform transfer agency services for the Portfolio.
Such compensation amounted to $319,210 for the year ended June 30, 1999.
For the year ended June 30, 1999, the Fund's expenses were reduced by $1,568
under an expense offset arrangement with Alliance Fund Services.
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NOTE C: Distribution Assistance and Administrative Services Plan
Under this Plan, the Portfolio pays Alliance Fund Distributors, Inc. (the
"Distributor"), a wholly-owned subsidiary of the Adviser, a distribution fee at
the annual rate of .25% of the average daily value of the Portfolio's net
assets. The Plan provides that the Distributor will use such payments in their
entirety for distribution assistance and promotional activities. For the year
ended June 30, 1999, the distribution fee amounted to $3,521,988. In
5
<PAGE>
NOTES TO FINANCIAL STATEMENTS (continued) Alliance Money Reserves
================================================================================
addition, the Portfolio may reimburse certain broker-dealers for administrative
costs incurred in connection with providing shareholder services, and may
reimburse the Adviser for accounting and book keeping, and legal and compliance
support. For the year ended June 30, 1999, such payments by the Portfolio
amounted to $1,960,974, of which $138,000 was paid to the Adviser.
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NOTE D: Investment Transactions
At June 30, 1999, the cost of investments for federal income tax purposes was
the same as the cost for financial reporting purposes. At June 30, 1999, the
Portfolio had a capital loss carryforward of $617,316, of which $72,812 expires
in 2001, $64,655 expires in 2002 and $479,849 expires in the year 2003.
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NOTE E: Transactions in Shares of Beneficial Interest
An unlimited number of shares ($.001 par value) are authorized. At June 30,
1999, capital paid-in aggregated $1,408,006,217. Transactions, all at $1.00 per
share, were as follows:
<TABLE>
<CAPTION>
Year Ended Year Ended
June 30, June 30,
1999 1998
-------------- --------------
<S> <C> <C>
Shares sold ................................... 2,797,230,722 3,468,843,260
Shares issued on reinvestments of dividends ... 60,259,581 53,704,005
Shares redeemed ............................... (2,616,449,382) (3,366,965,427)
-------------- --------------
Net increase .................................. 241,040,921 155,581,838
============== ==============
</TABLE>
6
<PAGE>
FINANCIAL HIGHLIGHTS Alliance Money Reserves
================================================================================
Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each
Year
<TABLE>
<CAPTION>
Year Ended June 30,
--------------------------------------------------
1999 1998 1997 1996 1995
------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year ..................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------ ------ ------ ------ ------
Income from Investment Operations
Net investment income (a) .............................. .043 .047 .045 .047 .045
------ ------ ------ ------ ------
Less: Dividends
Dividends from net investment income ................... (.043) (.047) (.045) (.047) (.045)
------ ------ ------ ------ ------
Net asset value, end of year ........................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
====== ====== ====== ====== ======
Total Return
Total investment return based on net asset value (b) ... 4.39% 4.83% 4.64% 4.81% 4.50%
Ratios/Supplemental Data
Net assets, end of year (in millions) .................. $1,407 $1,166 $1,011 $ 755 $2,510
Ratios to average net assets of:
Expenses, net of waivers and reimbursements ......... 1.00% 1.00% 1.00% 1.00% 1.00%
Expenses, before waivers and reimbursements ......... 1.02% 1.02% 1.06% 1.00% 1.04%
Net investment income (a) ........................... 4.28% 4.72% 4.55% 4.80% 4.53%
</TABLE>
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(a) Net of expenses reimbursed or waived by the Adviser.
(b) Total investment return is calculated assuming an initial investment made
at the net asset value at the beginning of the period, reinvestment of all
dividends and distributions at net asset value during the period, and
redemption on the last day of the period.
7
<PAGE>
INDEPENDENT AUDITOR'S REPORT Alliance Money Reserves
================================================================================
To the Board of Trustees and Shareholders
Alliance Money Reserves Portfolio
We have audited the accompanying statement of net assets of Alliance Money
Reserves Portfolio as of June 30, 1999 and the related statements of operations,
changes in net assets, and financial highlights for the periods indicated in the
accompanying financial statements. These financial statements and financial
highlights are the responsibility of the Portfolio's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of June
30, 1999, by correspondence with the custodian and brokers.
An audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of
Alliance Money Reserves Portfolio as of June 30, 1999, and the results of its
operations, changes in its net assets, and its financial highlights for the
periods indicated, in conformity with generally accepted accounting principles.
/s/ McGladrey & Pullen, LLP
McGladrey & Pullen, LLP
New York, New York
July 23, 1999
8
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Alliance Money Reserves -----------------
1345 Avenue of the Americas, New York, NY 10105 BULK RATE
Toll free 1 (800) 221-5672 U.S. POSTAGE
PAID
Yields. For current recorded yield information on Alliance New York, NY
Money Reserves, call on a touch-tone telephone toll-free Permit No. 7131
(800) 251-0539 and press the following sequence of keys: -----------------
- - - - - - - -
1 # 1 # 3 6 #
- - - - - - - -
For non-touch-tone telephones, call toll-free (800) 221-9513
- --------------------------------------------------------------------------------
Alliance Capital [LOGO](R)
Distribution of this report other than to shareholders must be preceded or
accompanied by the Fund's current prospectus, which contains further information
about the Fund.
(R) These registered service marks used under license from the owner, Alliance
Capital Management L.P.
