CONTENTS
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FEE TABLE
............................................................................ 2
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FINANCIAL HIGHLIGHTS
............................................................................ 3
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INVESTMENT OBJECTIVES,
POLICIES AND TECHNIQUES
............................................................................ 3
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INVESTMENT ADVISER AND ADMINISTRATOR
............................................................................ 6
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DISTRIBUTIONS AND TAXES
............................................................................ 7
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PERFORMANCE
............................................................................ 8
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MISCELLANEOUS INFORMATION
............................................................................ 9
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SHAREHOLDER'S GUIDE
Purchases ................................................................... 10
Redemptions ................................................................. 10
Shareholder Communications .................................................. 10
SUBJECT TO COMPLETION
PRELIMINARY PROSPECTUS DATED SEPTEMBER 24, 1996
[LOGO]
JANUS MONEY MARKET FUND
JANUS GOVERNMENT MONEY MARKET FUND
JANUS TAX-EXEMPT MONEY MARKET FUND
Service Shares
100 Fillmore Street
Denver, CO 80206-4923
____________, 1996
Janus Money Market Fund, Janus Government Money Market Fund, and Janus
Tax-Exempt Money Market Fund (individually, a "Fund" and, collectively, the
"Funds") are designed for investors who seek maximum current income consistent
with stability of capital. This prospectus offers a separate class of shares of
each Fund (collectively, the "Shares") exclusively through banks and other
financial institutions ("Financial Institutions") in connection with trust
accounts, cash management programs and similar programs provided to their
customers. Each Fund is a separate series of Janus Investment Fund (the
"Trust"), an open-end management investment company.
Each Fund invests exclusively in high quality money market instruments. AN
INVESTMENT IN A FUND IS NEITHER INSURED NOR GUARANTEED BY THE U.S. GOVERNMENT.
THERE IS NO ASSURANCE THAT A FUND WILL BE ABLE TO MAINTAIN A STABLE NET ASSET
VALUE OF $1.00 PER SHARE.
The Shares are offered with no sales charges, commissions, redemption fees, Rule
12b-1 fees or deferred sales charges. There is a $250,000 initial investment
minimum by each Financial Institution. The Financial Institution may aggregate
investments by all of its customers to achieve this minimum. There is no minimum
amount required for subsequent investments. For complete details on how to
purchase, redeem and exchange Shares, please see the Shareholder's Guide
beginning at page 10.
This prospectus contains information about the Shares that prospective investors
should consider before investing and should be read carefully and retained for
future reference. Additional information about the Shares is contained in the
Statement of Additional Information ("SAI") dated November 22, 1996, which is
filed with the Securities and Exchange Commission ("SEC") and is incorporated by
reference into this Prospectus. The SAI is available upon request and without
charge by writing or calling your Financial Institution.
THE SHARES OFFERED BY THIS PROSPECTUS ARE NOT DEPOSITS OR OBLIGATIONS OF ANY
BANK, ARE NOT ENDORSED OR GUARANTEED BY ANY BANK, AND ARE NOT INSURED BY THE
FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD, OR ANY OTHER
GOVERNMENT AGENCY.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SEC OR ANY STATE
SECURITIES COMMISSION NOR HAS THE SEC OR ANY STATE SECURITIES COMMISSION PASSED
UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL SECURITIES IN ANY STATE OR
OTHER JURISDICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH AN OFFER IN
SUCH STATE OR OTHER JURISDICTION.
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
JANUS MONEY MARKET FUNDS - SERVICE SHARES PROSPECTUS 1
<PAGE>
FEE TABLE
SHAREHOLDER TRANSACTION EXPENSES (Applicable to each Fund)
Sales Load Imposed on Purchases None
Sales Load Imposed on Reinvested Dividends None
Deferred Sales Load None
Redemption Fees None
Exchange Fee None
ANNUAL OPERATING EXPENSES*
(Expressed as a percentage of average net assets)
<TABLE>
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Management Other Total Operating
Fee Expenses Expenses
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<S> <C> <C> <C>
Janus Money Market Fund - Service Shares 0.10% 0.30% 0.40%
Janus Government Money Market Fund - Service Shares 0.10% 0.30% 0.40%
Janus Tax-Exempt Money Market Fund - Service Shares 0.10% 0.30% 0.40%
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</TABLE>
*The fees and expenses in the table above are based on the estimated fees and
expenses that the Service Shares of the Funds expect to incur in their initial
fiscal year, net of fee waivers from the investment adviser. Without such
waivers, the Management Fee, Other Expenses and Total Operating Expenses for
Service Shares are estimated to be 0.20%, 0.40% and 0.60%, respectively. Janus
Capital may modify or terminate the waivers at any time upon 90 days' notice to
the Trustees. See "Investment Adviser and Administrator" for a more detailed
discussion of the fees.
EXAMPLE
You would indirectly pay the following expenses on a $1,000 investment, assuming
expense ratios remain as listed above and assuming a 5% annual return, with or
without redemption at the end of each period:
<TABLE>
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1 Year 3 Years
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<S> <C> <C>
Janus Money Market Fund - Service Shares $4 $13
Janus Government Money Market Fund - Service Shares $4 $13
Janus Tax-Exempt Money Market Fund - Service Shares $4 $13
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</TABLE>
THE EXPENSES IN THE EXAMPLE ABOVE SHOULD NOT BE CONSIDERED A REPRESENTATION OF
PAST OR FUTURE EXPENSES AND ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE
SHOWN. THE ASSUMED 5% ANNUAL RETURN IS HYPOTHETICAL AND SHOULD NOT BE CONSIDERED
A REPRESENTATION OF PAST OR FUTURE ANNUAL RETURNS, WHICH MAY BE GREATER OR LESS
THAN THE ASSUMED AMOUNT.
The purpose of the preceding table and example is to assist the investor in
understanding the various costs and expenses that an investor in each Fund will
bear directly or indirectly. These expenses are described in greater detail
under "Investment Adviser and Administrator."
JANUS MONEY MARKET FUNDS - SERVICE SHARES PROSPECTUS 2
<PAGE>
FINANCIAL HIGHLIGHTS
No Financial Highlights are presented for the Shares because the Shares did not
commence operations until November 22, 1996.
INVESTMENT OBJECTIVES, POLICIES AND TECHNIQUES
Unless otherwise stated, the investment objectives and policies set forth in
this Prospectus are not fundamental and may be changed by the Trustees of the
Trust (the "Trustees") without shareholder approval. Shareholders will be
notified of material changes in investment objectives or policies. If there is a
change in the investment objective or policies of any Fund, shareholders should
consider whether that Fund remains an appropriate investment in light of their
then current financial position and needs. The Funds are subject to additional
investment policies and restrictions described in the SAI, some of which are
fundamental and may not be changed without shareholder approval.
INVESTMENT OBJECTIVES
The investment objective of Janus Money Market Fund and Janus Government Money
Market Fund is to seek maximum current income to the extent consistent with
stability of capital. The investment objective of Janus Tax-Exempt Money Market
Fund is to seek maximum current income that is exempt from federal income taxes
to the extent consistent with stability of capital. There can be no assurance
that a Fund will achieve its investment objective or that the Shares will be
able to maintain a stable net asset value of $1.00 per share.
COMMON INVESTMENT POLICIES
The Funds will invest only in eligible high quality, short-term money market
instruments that present minimal credit risks, as determined by Janus Capital
Corporation, the Funds' investment adviser ("Janus Capital"), pursuant to
procedures adopted by the Trustees. Each Fund may invest only in U.S.
dollar-denominated instruments that have a remaining maturity of 397 days or
less (as calculated pursuant to Rule 2a-7 under the Investment Company Act of
1940 ("1940 Act")) and will maintain a dollar-weighted average portfolio
maturity of 90 days or less.
Except to the limited extent permitted by Rule 2a-7 and except for U.S.
Government Securities (as defined below), each Fund will not invest more than 5%
of its total assets in the securities of any one issuer. A guarantor is not
considered an issuer for the purpose of this limit, provided that the value of
all securities held by a Fund that are issued or guaranteed by that institution
does not exceed 10% of the Fund's total assets. Until the amendments to Rule
2a-7 become effective, up to 25% of Janus Tax-Exempt Money Market Fund's assets
may be invested without regard to the foregoing limitations. To ensure adequate
liquidity, no Fund may invest more than 10% of its net assets in illiquid
investments, including repurchase agreements maturing in more than seven days
(unless subject to a demand feature) and certain time deposits that are subject
to early withdrawal penalties and mature in more than seven days. Because the
Funds are typically used as a cash management vehicle, they intend to maintain a
high degree of liquidity. Janus Capital determines and monitors the liquidity of
portfolio securities under the supervision of the Trustees.
Ratings.
High quality money market instruments include those that (i) are rated (or, if
unrated, are issued by an issuer with comparable outstanding short-term debt
that is rated) in one of the two highest rating categories for short-term debt
by any two nationally recognized statistical rating organizations ("NRSROs") or,
if only one NRSRO has issued a rating, by that NRSRO or (ii) are otherwise
unrated and determined by Janus Capital to be of comparable quality. Each Fund,
except Janus Tax-Exempt Money Market Fund, will invest at least 95% of its total
assets in securities in the highest rating category (as determined pursuant to
Rule 2a-7). Descriptions of the rating categories of Standard & Poor's Ratings
Services, Moody's Investors Service, Inc., and certain other NRSROs are
contained in the SAI, as is a further description of the Funds' investment
policies.
Although each Fund only invests in high quality money market instruments, an
investment in a Fund is subject to risk even if all securities in its portfolio
are paid in full at maturity. All money market instruments, including U.S.
Government Securities, can change in value as a result of changes in interest
rates, the issuer's actual or perceived creditworthiness or the issuer's ability
to meet its obligations.
TYPES OF INVESTMENTS
Janus Money Market Fund
Janus Money Market Fund pursues its objective by investing primarily in high
quality commercial paper and obligations of financial institutions. The Fund may
also invest in U.S. Government Securities (as defined below) and municipal
securities, although the Fund expects to invest in such securities to a lesser
degree.
Debt Obligations.
The Fund may invest in debt obligations of domestic issuers, including
commercial paper (short-term promissory notes issued by companies to finance
their, or their affiliates', current obligations), notes and bonds, and variable
amount master demand notes. The payment obligations on these instruments may be
backed by securities, swap agreements or other assets, by the guarantee of a
third party or solely by the unsecured promise of the issuer to make payments
when due. The Fund may invest in privately issued commercial paper or other
securities that are restricted as to disposition under the federal securities
laws. In general, sales of these securities may not be made absent registration
under the Securities Act of 1933 (the "1933 Act") or the availability of an
appropriate exemption therefrom. Pursuant to Section 4(2) of the 1933 Act or
Rule 144A adopted under the 1933 Act, however, some of these securities are
eligible for resale to institutional investors, and accordingly, Janus Capital
may determine that a liquid market exists for such a security pursuant to
guidelines adopted by the Trustees.
JANUS MONEY MARKET FUNDS - SERVICE SHARES PROSPECTUS 3
<PAGE>
Obligations of Financial Institutions.
The Fund may invest in obligations of financial institutions. Examples of
obligations in which the Fund may invest include negotiable certificates of
deposit, bankers' acceptances and time deposits of U.S. banks (including savings
and loan associations) having total assets in excess of one billion dollars and
U.S. branches of foreign banks having total assets in excess of ten billion
dollars. The Fund may also invest in Eurodollar and Yankee bank obligations as
discussed below.
Certificates of deposit represent an institution's obligation to repay funds
deposited with it that earn a specified interest rate over a given period.
Bankers' acceptances are negotiable obligations of a bank to pay a draft which
has been drawn by a customer and are usually backed by goods in international
trade. Time deposits are non-negotiable deposits with a banking institution that
earn a specified interest rate over a given period. Fixed time deposits, which
are payable at a stated maturity date and bear a fixed rate of interest,
generally may be withdrawn on demand by the Fund but may be subject to early
withdrawal penalties that could reduce the Fund's yield. Unless there is a
readily available market for them, time deposits that are subject to early
withdrawal penalties and that mature in more than seven days will be treated as
illiquid securities.
Eurodollar or Yankee Obligations.
The Fund may invest in Eurodollar and Yankee bank obligations. Eurodollar bank
obligations are dollar-denominated certificates of deposit or time deposits
issued outside the U.S. capital markets by foreign branches of U.S. banks and by
foreign banks. Yankee bank obligations are dollar-denominated obligations issued
in the U.S. capital markets by foreign banks.
Eurodollar (and to a limited extent, Yankee) bank obligations are subject to
certain sovereign risks. One such risk is the possibility that a foreign
government might prevent dollar-denominated funds from flowing across its
borders. Other risks include: adverse political and economic developments in a
foreign country; the extent and quality of government regulation of financial
markets and institutions; the imposition of foreign withholding taxes; and
expropriation or nationalization of foreign issuers.
U.S. Government Securities.
The Fund may invest without limit in U.S. Government Securities as described
below under "Janus Government Money Market Fund."
Municipal Securities.
The Fund may invest in obligations of states, territories or possessions of the
United States and their subdivisions, authorities and corporations as described
below under "Janus Tax-Exempt Money Market Fund." These obligations may pay
interest that is exempt from federal income taxation.
JANUS GOVERNMENT MONEY MARKET FUND
Janus Government Money Market Fund pursues its objective by investing
exclusively in obligations issued and/or guaranteed as to principal and interest
by the United States government or by its agencies and instrumentalities and
repurchase agreements secured by such obligations.
U.S. Government Securities.
U.S. Government Securities shall have the meaning set forth in the 1940 Act. The
1940 Act defines U.S. Government Securities to include securities issued or
guaranteed by the U.S. government, its agencies and instrumentalities. U.S.
Government Securities may also include repurchase agreements collateralized by
and municipal securities escrowed with or refunded with U.S. government
securities. U.S. Government Securities in which the Fund may invest include U.S.
Treasury securities and obligations issued or guaranteed by U.S. government
agencies and instrumentalities that are backed by the full faith and credit of
the U.S. government, such as those guaranteed by the Small Business
Administration or issued by the Government National Mortgage Association. In
addition, U.S. Government Securities in which the Fund may invest include
securities supported primarily or solely by the creditworthiness of the issuer,
such as securities of the Federal National Mortgage Association, the Federal
Home Loan Mortgage Corporation and the Tennessee Valley Authority. There is no
guarantee that the U.S. government will support securities not backed by its
full faith and credit. Accordingly, although these securities have historically
involved little risk of loss of principal if held to maturity, they may involve
more risk than securities backed by the full faith and credit of the U.S.
government.
Janus Tax-Exempt Money Market Fund
Janus Tax-Exempt Money Market Fund pursues its objective by investing primarily
in municipal securities whose interest is exempt from federal income taxes,
including the federal alternative minimum tax. Although the Fund will attempt to
invest substantially all of its assets in municipal securities whose interest is
exempt from federal income taxes, the Fund reserves the right to invest up to
20% of the value of its net assets in securities whose interest is federally
taxable. Additionally, when its portfolio manager is unable to locate investment
opportunities with desirable risk/reward characteristics, the Fund may invest
without limit in cash and cash equivalents, including obligations that may be
federally taxable (see "Taxable Investments").
Municipal Securities.
The municipal securities in which the Fund may invest include municipal notes
and short-term municipal bonds. Municipal notes are generally used to provide
for the issuer's short-term capital needs and generally have maturities of 397
days or less. Examples include tax anticipation and revenue anticipation notes,
which generally are issued in anticipation of various seasonal revenues, bond
anticipation notes, construction loan notes and tax-exempt commercial paper.
Short-term municipal bonds may include "general obligation bonds," which are
secured by the issuer's pledge of its faith, credit and taxing power for payment
of principal and interest; "revenue bonds," which are generally paid from the
revenues of a particular facility or a specific excise tax or other source; and
"industrial development bonds," which are issued by or on behalf of public
authorities
JANUS MONEY MARKET FUNDS - SERVICE SHARES PROSPECTUS 4
<PAGE>
to provide funding for various privately operated industrial and commercial
facilities. The Fund may also invest in high quality participation interests in
municipal securities. A more detailed description of various types of municipal
securities is contained in Appendix B in the SAI.
When the assets and revenues of an agency, authority, instrumentality or other
political subdivision are separate from those of the government creating the
issuing entity and a security is backed only by the assets and revenues of the
issuing entity, that entity will be deemed to be the sole issuer of the
security. Similarly, in the case of an industrial development bond backed only
by the assets and revenues of the non-governmental issuer, the non-governmental
issuer will be deemed to be the sole issuer of the bond.
At times, the Fund may invest more than 25% of the value of its total assets in
tax-exempt securities that are related in such a way that an economic, business,
or political development or change affecting one such security could similarly
affect the other securities; for example, securities whose issuers are located
in the same state, or securities whose interest is derived from revenues of
similar type projects. The Fund may also invest more than 25% of its assets in
industrial development bonds or participation interests therein.
Yields on municipal securities are dependent on a variety of factors, including
the general conditions of the money market and of the municipal bond and
municipal note markets, the size of a particular offering, the maturity of the
obligation and the rating of the issue. The achievement of the Fund's investment
objective is dependent in part on the continuing ability of the issuers of
municipal securities in which the Fund invests to meet their obligations for the
payment of principal and interest when due. Obligations of issuers of municipal
securities are subject to the provisions of bankruptcy, insolvency and other
laws affecting the rights and remedies of creditors, such as the Bankruptcy
Reform Act of 1978, as amended. Therefore, the possibility exists that, as a
result of litigation or other conditions, the ability of any issuer to pay, when
due, the principal of and interest on its municipal securities may be materially
affected.
Municipal Leases.
The Fund may invest in municipal leases or participation interests therein.
Municipal leases are municipal securities which may take the form of a lease or
an installment purchase or conditional sales contract. Municipal leases are
issued by state and local governments and authorities to acquire a wide variety
of equipment and facilities. Lease obligations may not be backed by the issuing
municipality's credit and may involve risks not normally associated with general
obligation bonds and other revenue bonds. For example, their interest may become
taxable if the lease is assigned and the holders may incur losses if the issuer
does not appropriate funds for the lease payment on an annual basis, which may
result in termination of the lease and possible default. Janus Capital may
determine that a liquid market exists for municipal lease obligations pursuant
to guidelines established by the Trustees.
Taxable Investments.
As discussed above, although the Fund will attempt to invest substantially all
of its assets in municipal securities whose interest is exempt from federal
income tax, the Fund may under certain circumstances invest in certain
securities whose interest is subject to such taxation. These securities include:
(i) short-term obligations of the U.S. government, its agencies or
instrumentalities, (ii) certificates of deposit, bankers' acceptances and
interest-bearing savings deposits of banks having total assets of more than one
billion dollars and whose deposits are insured by the Federal Deposit Insurance
Corporation, (iii) commercial paper and (iv) repurchase agreements as described
below covering any of the securities described in items (i)-(iii) above or any
other obligations of the U.S. government, its agencies or instrumentalities.
COMMON INVESTMENT TECHNIQUES
Participation Interests.
The Funds may invest in participation interests in any type of security in which
the Funds may invest. A participation interest gives a Fund an undivided
interest in the underlying securities in the proportion that the Fund's
participation interest bears to the total principal amount of the underlying
securities. Participation interests usually carry a demand feature, as described
below, backed by a letter of credit or guarantee of the institution that issued
the interests permitting the holder to tender them back to the institution.
Demand Features.
The Funds may invest in securities that are subject to puts and stand-by
commitments ("demand features"). Demand features give the Fund the right to
resell securities at specified periods prior to their maturity dates to the
seller or to some third party at an agreed-upon price or yield. Securities with
demand features may involve certain expenses and risks, including the inability
of the issuer of the instrument to pay for the securities at the time the
instrument is exercised, non-marketability of the instrument and differences
between the maturity of the underlying security and the maturity of the
instrument. Securities may cost more with demand features than without them.
Demand features can serve three purposes: to shorten the maturity of a variable
or floating rate security, to enhance the instrument's credit quality and to
provide a source of liquidity. Demand features are often issued by third party
financial institutions, generally domestic and foreign banks. Accordingly, the
credit quality and liquidity of the Funds' investments may be dependent in part
on the credit quality of the banks supporting the Funds' investments. This will
result in exposure to risks pertaining to the banking industry, including the
foreign banking industry. Brokerage firms and insurance companies also provide
certain liquidity and credit support. A substantial portion of the Janus
Tax-Exempt Money Market Fund's portfolio in particular may consist of securities
backed by banks and other financial institutions, and thus adverse changes in
the credit quality of these institutions could cause losses to the Fund and
affect its share price.
Variable and Floating Rate Securities.
The securities in which the Funds invest may have variable or floating rates of
interest. These securities pay interest
JANUS MONEY MARKET FUNDS - SERVICE SHARES PROSPECTUS 5
<PAGE>
at rates that are adjusted periodically according to a specified formula,
usually with reference to some interest rate index or market interest rate.
Securities with ultimate maturities of greater than 397 days may be purchased
only pursuant to Rule 2a-7. Under that Rule, only those long-term instruments
that have demand features which comply with certain requirements and certain
variable rate U.S. Government Securities may be purchased. Similar to fixed rate
debt instruments, variable and floating rate instruments are subject to changes
in value based on changes in market interest rates or changes in the issuer's or
guarantor's creditworthiness. The rate of interest on securities purchased by a
Fund may be tied to short-term Treasury or other government securities or
indices on securities that are permissible investments of the Funds, as well as
other money market rates of interest. The Funds will not purchase securities
whose values are tied to interest rates or indices that are not appropriate for
the duration and volatility standards of a money market fund.
Mortgage- and
Asset-Backed Securities.
Janus Money Market Fund and Janus Government Money Market Fund may purchase
fixed or adjustable rate mortgage-backed securities issued by the Government
National Mortgage Association, Federal National Mortgage Association, the
Federal Home Loan Mortgage Corporation, or other governmental or
government-related entities. In addition, Janus Money Market Fund may purchase
other asset-backed securities, including securities backed by automobile loans,
equipment leases or credit card receivables. These securities directly or
indirectly represent a participation in, or are secured by and payable from,
fixed or adjustable rate mortgage or other loans which may be secured by real
estate or other assets. Unlike traditional debt instruments, payments on these
securities include both interest and a partial payment of principal. Prepayments
of the principal of underlying loans may shorten the effective maturities of
these securities and may result in a Fund having to reinvest proceeds at a lower
interest rate.
Repurchase Agreements.
Each Fund may seek additional income by entering into collateralized repurchase
agreements. Repurchase agreements are transactions in which a Fund purchases
securities and simultaneously commits to resell those securities to the seller
at an agreed-upon price on an agreed-upon future date. The resale price reflects
a market rate of interest that is not related to the coupon rate or maturity of
the purchased securities. If the seller of the securities underlying a
repurchase agreement fails to pay the agreed resale price on the agreed delivery
date, a Fund may incur costs in disposing of the collateral and may experience
losses if there is any delay in its ability to do so.
Reverse Repurchase Agreements.
Each Fund may enter into reverse repurchase agreements. Reverse repurchase
agreements are transactions in which a Fund sells a security and simultaneously
commits to repurchase that security from the buyer at an agreed upon price on an
agreed upon future date. This technique will be used only for temporary or
emergency purposes, such as meeting redemption requests, or to earn additional
income on portfolio securities.
Delayed Delivery Securities.
Each Fund may purchase securities on a when-issued or delayed delivery basis.
Securities so purchased are subject to market price fluctuation from the time of
purchase but no interest on the securities accrues to a Fund until delivery and
payment for the securities take place. Accordingly, the value of the securities
on the delivery date may be more or less than the purchase price. Forward
commitments will be entered into only when a Fund has the intention of taking
possession of the securities, but a Fund may sell the securities before the
settlement date if deemed advisable.
Borrowing and Lending.
Each Fund may borrow money for temporary or emergency purposes in amounts up to
25% of its total assets. A Fund may not mortgage or pledge securities except to
secure permitted borrowings. As a fundamental policy, a Fund will not lend
securities or other assets if, as a result, more than 25% of its total assets
would be lent to other parties; however, the Funds do not currently intend to
engage in securities lending. Each Fund intends to seek permission from the SEC
to borrow money from or lend money to other funds that permit such transactions
and are advised by Janus Capital. There is no assurance that such permission
will be granted.
INVESTMENT ADVISER AND ADMINISTRATOR
INVESTMENT ADVISER
Each Fund has a separate Investment Advisory Agreement with Janus Capital, 100
Fillmore Street, Denver, Colorado 80206-4923. Janus Capital has served as
investment adviser to Janus Fund since 1970 and currently serves as investment
adviser to all of the Janus funds, as well as adviser or subadviser to other
mutual funds and individual, corporate, charitable and retirement accounts.
Kansas City Southern Industries, Inc., a publicly traded holding company whose
primary subsidiaries are engaged in transportation, information processing and
financial services ("KCSI"), owns approximately 83% of the outstanding voting
stock of Janus Capital. Thomas H. Bailey, the President and Chairman of the
Board of Janus Capital, owns approximately 12% of its voting stock and, by
agreement with KCSI, selects a majority of Janus Capital's Board.
JANUS MONEY MARKET FUNDS - SERVICE SHARES PROSPECTUS 6
<PAGE>
Pursuant to the Investment Advisory Agreements, Janus Capital furnishes
continuous advice and recommendations concerning each Fund's investments. Each
of the Funds has agreed to compensate Janus Capital for its advisory services by
the monthly payment of a fee at the annual rate of 0.20% of the value of the
average daily net assets of each Fund. Janus Capital has agreed to waive a
portion of its fee and accordingly, the advisory fee of each Fund will be
calculated at the annual rate of 0.10% of the value of each Fund's average daily
net assets. Janus Capital may modify or terminate the waiver at any time upon 90
days' notice to the Trustees.
ADMINISTRATOR
Each of the Funds has also entered into an Administration Agreement with Janus
Capital, pursuant to which Janus Capital furnishes certain administrative,
compliance and accounting services for the Funds, pays the costs of printing
reports and prospectuses for existing shareholders, provides office space for
the Funds and pays the salaries, fees and expenses of all Fund officers and of
those Trustees who are affiliated with Janus Capital. Administrative services
provided by Janus Capital under the Administration Agreements include custody
and transfer agency services. Janus Capital is paid an administration fee,
calculated daily and paid monthly, at the annual rate of 0.40% of the value of
the average daily net assets of each Fund attributable to Shares for services
rendered pursuant to the Administration Agreements. Janus Capital has agreed to
waive a portion of its fee and accordingly, the administration fee paid by the
Shares will be calculated at the annual rate of 0.30% of the value of each
Fund's average daily net assets attributable to the Shares. Janus Capital may
modify or terminate this waiver at any time upon 90 days' notice to the
Trustees.
Each Fund pays all of its expenses not assumed by Janus Capital, including
auditing fees and independent Trustees' fees and expenses.
Janus Capital may use all or a portion of its administration fee to compensate
Financial Institutions for providing administrative services to their customers
who invest in the Shares. The types of services that the Financial Institutions
would provide include serving as the sole shareholder of record, shareholder
recordkeeping, processing and aggregating purchase and redemption transactions,
providing periodic statements, forwarding shareholder reports and other
materials, providing tax information, and providing other similar services that
the Funds would have to perform if they were dealing directly with the
beneficial owners, rather than the Financial Institutions, as shareholders of
record.
The Glass-Steagall Act prohibits a depository institution (such as a commercial
bank or a savings and loan association) from being an underwriter or distributor
of most securities. In the event the Glass-Steagall Act is deemed to prohibit
depository institutions from acting in the administrative capacities described
above or should Congress relax current restrictions on depository institutions,
the Trustees will consider appropriate changes in the services.
PORTFOLIO TRANSACTIONS
Purchases and sales of securities on behalf of each Fund are executed by brokers
and dealers selected by Janus Capital. Broker-dealers are selected on the basis
of their ability to obtain best price and execution for the Funds' transactions
and recognizing brokerage, research and other services provided to the Fund and
to Janus Capital. Janus Capital may also consider payments made by brokers
effecting transactions for a Fund i) to the Fund or ii) to other persons on
behalf of the Fund for services provided to the Fund for which it would be
obligated to pay. The Funds' Trustees have also authorized the Funds to place
portfolio transactions on an agency basis with a broker-dealer that is
affiliated with Janus Capital. Agency trades, if any, that are placed with such
affiliated party serve to reduce certain expenses of the Funds. The SAI further
explains the selection of broker-dealers.
PERSONAL INVESTING
Janus Capital does not permit portfolio managers to purchase and sell securities
for their own accounts subject to Janus Capital's policy governing personal
investing. Janus Capital's policy requires investment and other personnel to
conduct their personal investment activities in a manner that Janus Capital
believes is not detrimental to the Funds and Janus Capital's other advisory
clients. See the SAI for more detailed information.
DISTRIBUTIONS AND TAXES
Dividends representing substantially all of the net investment income and any
net realized gains on sales of securities are declared daily, Saturdays, Sundays
and holidays included, and distributed on the last business day of each month.
If a month begins on a Saturday, Sunday or holiday, dividends for those days are
declared at the end of the preceding month and distributed on the first business
day of the month. Distributions will be reinvested in Shares of a Fund unless
otherwise elected by the shareholder pursuant to the options offered by the
Financial Institution.
Distributions for all of the Funds (except Janus Tax-Exempt Money Market Fund)
are taxable income and are subject to federal income tax (except for
shareholders exempt from income tax), whether such distributions are received in
cash or are reinvested in additional Shares. Full
JANUS MONEY MARKET FUNDS - SERVICE SHARES PROSPECTUS 7
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information regarding the tax status of income dividends and any capital gains
distributions will be mailed to Financial Institutions who will forward the
information to their customers for tax purposes on or before January 31st of
each year. Because the Funds are money market funds, they do not anticipate
making any capital gains distributions.
Janus Tax-Exempt Money Market Fund anticipates that substantially all income
dividends it pays will be exempt from federal income tax. However, dividends
attributable to interest on taxable investments, together with distributions
from any net realized capital gains, are taxable. In addition, interest on
certain private activity bonds is a preference item for purposes of the
individual and corporate alternative minimum taxes. To the extent that the Fund
earns such income, shareholders who are subject to the alternative minimum tax
must include such income as a preference item. The Fund will advise shareholders
of the percentage of dividends, if any, subject to the alternative minimum tax.
Dividends and capital gains distributions may also be subject to state and local
taxes. In certain states some portion of dividends and distributions (depending
on the sources of the Fund's net income) of Janus Tax-Exempt Money Market Fund
may be exempt from state and local taxes. Shareholders should consult their own
tax advisor regarding exemption from any applicable state and local tax, as well
as the tax treatment of any dividends or distributions from the Shares.
The Funds intend to comply with provisions of the Internal Revenue Code
applicable to investment companies, and thus it is not expected that any of the
Funds will be required to pay any federal income or excise taxes. The SAI
further explains the Funds' tax status.
PERFORMANCE
The Shares may measure performance in several ways, including "yield,"
"effective yield," and "tax equivalent yield" (for Janus Tax-Exempt Money Market
Fund only). Yield is a way of showing the rate of income the Shares earn on
investments as a percentage of the Share price. Yield represents the income,
less expenses generated by an investment, in the Shares over a seven-day period
expressed as an annual percentage rate. Effective yield is similar in that it is
calculated over the same time frame, but instead the net investment income is
compounded and then annualized. Due to the compounding effect, the effective
yield will normally be higher than the yield.
Shares of Janus Tax-Exempt Money Market Fund may also quote tax-equivalent
yield, which shows the taxable yield an investor would have to earn before taxes
to equal such Shares' tax-free yield. A tax-equivalent yield is calculated by
dividing such Shares' tax-exempt yield by the result of one minus a stated
federal tax rate. Only that portion of the Fund's income that is tax-exempt is
adjusted in this calculation.
Performance figures are based upon historical results and are not intended to
indicate future performance.
JANUS MONEY MARKET FUNDS - SERVICE SHARES PROSPECTUS 8
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MISCELLANEOUS INFORMATION
ORGANIZATION
Each Fund is an open-end management investment company registered under the 1940
Act as a series of the Trust, which was created on February 11, 1986. Each Fund
currently offers three classes of shares by separate prospectuses. The Shares
offered by this Prospectus are available only through Financial Institutions
that meet minimum investment requirements in connection with trust accounts,
cash management programs and similar programs provided to their customers. A
second class of shares, Institutional Shares of each Fund, are available only to
institutional clients, including corporations, foundations and trusts, and
individuals meeting certain initial investment requirements. A third class of
shares, Investor Shares of each Fund, are available to the general public.
Because the expenses of each class may differ, the performance of each class is
expected to differ. If you would like additional information, please call
1-800-29JANUS.
TRUSTEES
The Trustees oversee the business affairs of the Trust and are responsible for
major decisions relating to each Fund's investment objective and policies. The
Trustees delegate the day-to-day management of the Funds to the officers of the
Trust and meet at least quarterly to review the Funds' investment policies,
performance, expenses and other business affairs.
VOTING RIGHTS
The Trust is not required to hold annual shareholder meetings. However, special
meetings may be called for a specific class of shares, a specific Fund, or for
the Trust as a whole, for purposes such as electing or removing Trustees,
terminating or reorganizing the Trust, changing fundamental policies or voting
on matters when required by the 1940 Act. Separate votes are taken by a separate
Fund (or a separate class of shares) only if a matter affects or requires the
vote of just that Fund (or those shares). Shareholders are entitled to cast one
vote for each Share they own.
CUSTODIAN, TRANSFER AGENT
AND DISTRIBUTOR
United Missouri Bank, N.A., P.O. Box 419226, Kansas City, Missouri 64141-6226,
is the custodian of the Funds' assets. The custodian holds each Fund's assets in
safekeeping and collects and remits the income thereon subject to the
instructions of each Fund.
Janus Service Corporation, P.O. Box 173375, Denver, Colorado 80217-3375, a
wholly-owned subsidiary of Janus Capital, provides transfer agency and
shareholder services for the Funds.
Janus Distributors, Inc., 100 Fillmore Street, Denver, Colorado 80206-4923, a
wholly-owned subsidiary of Janus Capital, is a distributor of the Shares.
JANUS MONEY MARKET FUNDS - SERVICE SHARES PROSPECTUS 9
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SHAREHOLDER'S GUIDE
INVESTORS MAY NOT PURCHASE OR REDEEM SHARES OF THE FUNDS DIRECTLY. SHARES MAY BE
PURCHASED OR REDEEMED ONLY THROUGH FINANCIAL INSTITUTIONS IN CONNECTION WITH
TRUST ACCOUNTS, CASH MANAGEMENT PROGRAMS AND SIMILAR PROGRAMS. YOUR FINANCIAL
INSTITUTION WILL PROVIDE YOU WITH INSTRUCTIONS ON PURCHASING OR REDEEMING
SHARES.
PURCHASES
Purchases of Fund Shares may be made only through omnibus accounts of Financial
Institutions in connection with trust accounts, cash management programs and
similar programs. Your Financial Institution will provide you with instructions
on purchasing Shares.
All investments in the Funds are credited to a participating Financial
Institution's omnibus account upon acceptance of the investment by a Fund.
Investments will be processed at the NAV next determined after an order is
received and accepted by a Fund.
Each Fund reserves the right to reject any specific purchase order. Purchase
orders may be refused if, in Janus Capital's opinion, they are of a size that
would disrupt the management of a Fund. Any Fund may discontinue sales of its
Shares if management believes that a substantial further increase may adversely
affect that Fund's ability to achieve its investment objective. In such event,
however, it is anticipated that existing Financial Institution customers in that
Fund would be permitted to continue to authorize investment in such Fund and to
reinvest any dividends or capital gains distributions.
MINIMUM INVESTMENT
There is a $250,000 initial aggregate investment minimum by each Financial
Institution. The Funds may, in their discretion, waive this minimum under
certain circumstances but, in such event, the minimum must be reached within 90
days of opening the account. Financial Institutions who do not maintain the
$250,000 minimum will be given the option of requesting their customers to
exchange into Investor Shares if the required minimum investment for Investor
Shares is met or having their customers' Shares redeemed.
NET ASSET VALUE
The net asset value ("NAV") of the Shares is determined at the close of the
regular trading session of the New York Stock Exchange (normally 4:00 p.m., New
York time) each day that both the Exchange and the New York Federal Reserve Bank
are open. NAV per share is determined by dividing the total value of the
securities and other assets, less liabilities, by the total number of Shares
outstanding. Portfolio securities are valued at their amortized cost. Amortized
cost valuation involves valuing an instrument at its cost and thereafter
assuming a constant amortization to maturity (or such other date as permitted by
Rule 2a-7) of any discount or premium. If fluctuating interest rates cause the
market value of a portfolio to deviate more than 1/2 of 1% from the value
determined on the basis of amortized cost, the Trustees will consider whether
any action, such as adjusting the Share's NAV to reflect current market
conditions, should be initiated to prevent any material dilutive effect on
shareholders.
SHARE CERTIFICATES
Share certificates are not available for the Shares in order to maintain the
general liquidity that is representative of a money market fund and to help
facilitate transactions in shareholder accounts.
REDEMPTIONS
Redemptions, like purchases, may be effected only through the accounts of
participating Financial Institutions. Your Financial Institution will provide
you with instructions on redeeming shares.
Shares of any Fund may be redeemed on any business day. Redemptions are
processed at the NAV next calculated after receipt and acceptance of the
redemption order by the Fund. Redemption proceeds will normally be wired to the
participating Financial Institution the business day following receipt of the
redemption order, but in no event later than seven days after receipt of such
order.
SHAREHOLDER COMMUNICATIONS
Shareholders will receive annual and semiannual reports including the financial
statements of the Funds that they have authorized for investment from their
Financial Institution. Each report will show the investments owned by each Fund
and the market values thereof, as well as other information about the Funds and
their operations. The Trust's fiscal year ends October 31.
JANUS MONEY MARKET FUNDS - SERVICE SHARES PROSPECTUS 10
