<PAGE>
<PAGE>
STATEMENT OF NET ASSETS
DECEMBER 31, 1994 (UNAUDITED) ALLIANCE GOVERNMENT RESERVES
- - --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
(000) SECURITY+ YIELD VALUE
- - --------------------------------------------------------------------------------
<S> <C> <C> <C>
U.S. GOVERNMENT
AND AGENCIES--98.5%
FEDERAL NATIONAL MORTGAGE
ASSOCIATION--29.8%
$ 25,000 3/20/95 ...................... 5.22% $ 24,717,250
49,670 1/23/95 ...................... 5.27 49,510,035
25,000 1/11/95 ...................... 5.32 24,963,056
5,000 4/18/95....................... 5.49 4,918,413
16,830 1/30/95 ...................... 5.50 16,755,434
15,000 4/05/95 ...................... 5.53 14,783,408
9,750 1/23/95....................... 5.60 9,716,633
30,000 1/03/95 ...................... 5.70 29,990,500
30,000 1/12/95 ...................... 5.70 29,947,750
18,300 2/17/95 ...................... 5.70 18,163,817
3,500 1/23/95....................... 5.73 3,487,744
2,000 1/23/95....................... 5.74 1,992,984
36,000 1/20/95 ...................... 5.79 35,889,990
24,000 1/13/95 ...................... 5.83 23,953,360
50,000 1/26/95 ...................... 5.84 49,797,222
100,000 1/24/95 ...................... 5.85 99,626,250
21,300 1/09/95 ...................... 5.91 21,272,026
20,000 1/31/95 ...................... 5.96 19,900,667
9,445 3.79%, 2/24/95................ 6.00 9,411,380
20,000 5.25%, 6/30/95 ............... 5.41 19,984,589
22,000 5.60%, 7/19/95 FRN............ 5.63 21,996,405
25,000 5.80%, 1/25/95 FRN............ 5.80 25,000,000
45,000 5.98%, 10/30/95 FRN........... 6.03 44,972,585
15,000 6.76%, 6/27/95 ............... 6.73 14,996,524
------------
615,748,022
------------
FEDERAL HOME LOAN
MORTGAGE CORP.--26.7%
27,800 1/20/95....................... 5.25 27,722,971
2,035 1/05/95....................... 5.48 2,033,761
15,000 1/06/95....................... 5.48 14,988,583
76,000 2/02/95....................... 5.55 75,625,067
50,000 1/04/95....................... 5.57 49,976,792
15,000 1/05/95....................... 5.58 14,990,700
38,926 1/13/95....................... 5.58 38,853,598
5,000 1/18/95....................... 5.60 4,986,778
21,500 1/23/95....................... 5.63 21,426,028
34,000 2/17/95....................... 5.68 33,747,871
8,400 1/24/95....................... 5.70 8,369,410
3,500 1/23/95....................... 5.73 3,487,744
17,500 1/04/95....................... 5.80 17,491,542
25,000 2/02/95....................... 5.83 24,870,444
10,000 2/02/95....................... 5.85 9,948,000
18,000 1/23/95....................... 5.90 17,935,100
27,300 1/23/95....................... 5.94 27,200,901
30,000 1/17/95....................... 5.95 29,920,667
34,600 3/02/95 ...................... 6.17 34,244,197
7,225 4/04/95....................... 6.34 7,106,666
25,000 5.44%, 8/10/95 FRN............ 5.54 24,984,863
25,000 5.78%, 1/06/95................ 5.80 24,999,882
38,000 5.78%, 1/06/95 FRN............ 5.80 38,000,087
------------
552,911,652
------------
STUDENT LOAN MARKETING
ASSOCIATION--21.4%
50,000 1/06/95 ...................... 5.85 49,959,375
17,000 5.48%, 6/30/95 FRN............ 5.46 17,002,176
50,000 5.83%, 12/01/95 FRN........... 5.95 49,942,402
20,000 5.89%, 11/24/97 FRN........... 5.91 19,986,422
10,000 5.90%, 5/14/96 FRN............ 5.84 10,007,795
98,500 5.94%, 4/16/96 FRN............ 5.89 98,559,351
25,000 6.07%, 8/07/95 FRN............ 5.80 25,039,240
41,050 6.10%, 11/27/96 FRN........... 5.92 41,185,660
40,000 6.12%, 1/23/97 FRN............ 5.93 40,169,006
40,000 6.15%, 2/14/97 FRN............ 5.91 40,198,922
20,000 6.17%, 8/22/96 FRN............ 6.12 20,010,746
21,000 6.30%, 4/24/95 FRN............ 5.84 21,029,979
10,000 6.32%, 3/23/95 FRN............ 5.88 10,009,813
------------
443,100,887
------------
FEDERAL HOME LOAN
BANK--11.4%
4,200 1/03/95....................... 5.58 4,198,698
10,000 1/04/95....................... 5.74 9,995,217
29,200 1/06/95....................... 5.85 29,176,275
20,000 1/09/95....................... 5.88 19,973,867
17,000 1/23/95....................... 5.63 16,941,511
29,200 2/21/95....................... 5.89 28,956,350
37,000 2/28/95....................... 5.98 36,643,525
13,000 3.46%, 2/03/95................ 3.66 12,997,520
10,000 3.81%, 2/28/95................ 4.00 9,996,864
10,000 5.51%, 10/20/95 FRN........... 5.59 9,993,594
47,500 5.81%, 8/05/96 FRN............ 5.96 47,393,663
10,000 6.00%, 10/06/95............... 6.07 9,995,240
------------
236,262,324
------------
</TABLE>
<PAGE>
STATEMENT OF NET ASSETS (CONTINUED) ALLIANCE GOVERNMENT RESERVES
- - --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
(000) SECURITY+ YIELD VALUE
- - --------------------------------------------------------------------------------
<S> <C> <C> <C>
U.S. TREASURY NOTES--4.3%
$16,000 3.88%, 4/30/95................ 4.99% $ 15,943,125
10,000 3.88%, 8/31/95................ 5.67 9,885,596
10,000 4.13%, 5/31/95................ 5.32 9,953,245
30,000 4.25%, 1/31/95................ 3.59 30,015,489
22,000 5.88%, 5/15/95................ 5.38 22,035,837
--------------
87,833,292
--------------
FEDERAL FARM CREDIT
BANK--3.6%
12,375 1/09/95....................... 5.22 12,360,645
2,500 1/23/95....................... 5.70 2,491,292
19,350 1/23/95....................... 5.95 19,279,641
10,000 5.70%, 9/01/95................ 5.87 9,988,169
30,000 5.85%, 5/01/95................ 5.87 29,995,338
--------------
74,115,085
--------------
U.S. TREASURY BILL--0.7%
14,500 2/09/95....................... 3.60 14,444,533
--------------
OVERSEAS PRIVATE INVESTMENT
CORP.--0.6%
10,000 6.39%, 6/15/07 FRN............ 6.39 10,000,000
3,125 6.42%, 6/10/97 FRN............ 6.42 3,125,000
--------------
13,125,000
--------------
Total U.S. Government
and Agencies (amortized
cost $2,037,540,795).......... 2,037,540,795
--------------
VARIABLE RATE NOTES--0.6%
Agency For International
Development Housing
$11,847 6.52%, 1/01/97................ 6.54% $ 11,846,492
All Nippon Airways Co.,
Ltd. (guaranteed by
Export-Import Bank of
U.S. LOC)
500 6.35%, 3/25/95 FRN............ 6.35 500,000
--------------
TOTAL VARIABLE RATE NOTES
(amortized cost
$12,346,492).................. 12,346,492
--------------
TOTAL INVESTMENTS--99.1%
(amortized cost
$2,049,887,287)............... 2,049,887,287
Other assets less
liabilities--0.9%............. 19,090,244
--------------
NET ASSETS--100%
(offering and redemption
price of $1.00 per share;
2,069,923,333 shares
outstanding).................. $2,068,977,531
==============
</TABLE>
- - --------------------------------------------------------------------------------
+ All securities either mature or their interest rate changes in one year or
less.
Glossary of Terms:
FRN Floating Rate Note
LOC Letter of Credit
See notes to financial statements.
2
<PAGE>
STATEMENT OF OPERATIONS
SIX MONTHS ENDED DECEMBER 31, 1994 (UNAUDITED) ALLIANCE GOVERNMENT RESERVES
- - --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C> <C>
INVESTMENT INCOME
Interest...................................................... $50,292,128
EXPENSES
Advisory fee (Note B)......................................... $ 5,139,069
Distribution assistance and administrative service............ 3,384,196
Transfer agency............................................... 1,963,522
Registration fees............................................. 153,928
Custodian fees................................................ 152,450
Audit and legal fees.......................................... 58,996
Printing...................................................... 42,315
Trustees' fees................................................ 16,705
Miscellaneous................................................. 11,808
-----------
Total expenses................................................ 10,922,989
Less: expense reimbursement and fee waiver.................... (463,428) 10,459,561
----------- -----------
Net investment income......................................... 39,832,567
REALIZED LOSS ON INVESTMENTS
Net realized loss on investments.............................. (560,364)
-----------
NET INCREASE IN NET ASSETS FROM OPERATIONS........................ $39,272,203
===========
</TABLE>
STATEMENTS OF CHANGES IN NET ASSETS
- - --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS ENDED
DECEMBER 31, 1994 YEAR ENDED
(UNAUDITED) JUNE 30, 1994
----------------- --------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS
Net investment income.................................... $ 39,832,567 $ 48,029,539
Net realized loss on investments......................... (560,364) (236,674)
-------------- --------------
Net increase in net assets from operations............... 39,272,203 47,792,865
DIVIDENDS TO SHAREHOLDERS FROM:
Net investment income.................................... (39,832,567) (48,029,539)
TRANSACTIONS IN SHARES OF BENEFICIAL INTEREST
Net increase............................................. 8,496,252 278,696,374
-------------- --------------
Total increase........................................... 7,935,888 278,459,700
NET ASSETS
Beginning of period...................................... 2,061,041,643 1,782,581,943
-------------- --------------
End of period............................................ $2,068,977,531 $2,061,041,643
============== ==============
</TABLE>
3
<PAGE>
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1994 (UNAUDITED) ALLIANCE GOVERNMENT RESERVES
- - --------------------------------------------------------------------------------
NOTE A: SIGNIFICANT ACCOUNTING POLICIES
Alliance Government 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 Government Reserves (the "Portfolio") and Alliance
Treasury Reserves. Each portfolio is considered to be a separate entity for
financial reporting and tax purposes. The following is a summary of significant
accounting policies followed by the Fund.
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.
2. TAXES
It is the Portfolio's policy to comply with 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 applicable,
to its shareholders. Therefore, no provisions for federal income or excise taxes
are required.
3. DIVIDENDS
The Portfolio declares dividends daily 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. GENERAL
Interest income is accrued as earned. Security transactions are recorded on a
trade date basis. Security gains and losses are determined on the identified
cost basis. It is the Portfolio's policy to take possession of securities as
collateral under repurchase agreements and to determine on a daily basis that
the value of such securities are sufficient to cover the value of the
repurchase agreements.
- - --------------------------------------------------------------------------------
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 of 1% on the first $1.25 billion of average
daily net assets; .49 of 1% on the next $.25 billion; .48 of 1% on the next
$.25 billion; .47 of 1% on the next $.25 billion; .46 of 1% on the next $1
billion; and .45% in excess of $3 billion. The Adviser has agreed to
reimburse the Portfolio to the extent that its aggregate expenses (excluding
taxes, brokerage, interest and, where permitted, extraordinary expenses)
exceed 1% of its average daily net assets for any fiscal year. For the six
months ended December 31, 1994, the reimbursement amounted to $254,237. The
Portfolio compensates Alliance Fund Services, Inc. (a wholly-owned subsidiary
of the Adviser) for providing personnel and facilities to perform transfer
agency services for the Portfolio. Such compensation amounted to $1,170,312
for the six months ended December 31, 1994.
- - --------------------------------------------------------------------------------
NOTE C: DISTRIBUTION ASSISTANCE AND ADMINISTRATIVE SERVICES PLAN
Under this plan, the Portfolio pays the Adviser a distribution fee at the
annual rate of up to .25 of 1% of the average daily value of the Portfolio's
net assets. The Plan provides that the Adviser will use such payments in
their entirety for distribution assistance and promotional activities. For
the six months ended December 31, 1994, the distribution fee amounted to
$2,614,890 of which $209,191 was waived. In addition, the Portfolio
reimbursed certain broker-dealers for administrative costs incurred in
connection with providing shareholder services, accounting and bookkeeping,
and legal and compliance support. For the six months ended December 31, 1994,
such payments by the Portfolio amounted to $769,306 of which $73,000 was paid
to the Adviser.
- - --------------------------------------------------------------------------------
NOTE D: INVESTMENT TRANSACTIONS
At December 31, 1994, the cost of portfolio securities for federal income tax
purposes was the same as the cost for financial reporting purposes. At June 30,
1994, the fund had a capital loss carryforward of $385,438, of which $148,764
expires in 2001 and $236,674 expires in 2002.
4
<PAGE>
ALLIANCE GOVERNMENT RESERVES
- - --------------------------------------------------------------------------------
NOTE E: TRANSACTIONS IN SHARES OF BENEFICIAL INTEREST
An unlimited number of shares ($.001 par value) are authorized. At December
31, 1994, capital paid-in aggregated $2,068,977,531. Transactions, all at $1.00
per share, were as follows:
<TABLE>
<CAPTION>
SIX MONTHS ENDED
DECEMBER 31, 1994 YEAR ENDED
(UNAUDITED) JUNE 30, 1994
----------------- ---------------
<S> <C> <C>
Shares sold....................................... 4,078,503,817 7,696,239,666
Shares issued on reinvestments of dividends....... 39,297,725 47,809,968
Shares redeemed................................... (4,109,305,290) (7,465,353,260)
-------------- --------------
Net increase...................................... 8,496,252 278,696,374
============== ==============
</TABLE>
- - --------------------------------------------------------------------------------
NOTE F: FINANCIAL HIGHLIGHTS
Per share operating performance for a share outstanding
throughout each period.
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED JUNE 30,
DECEMBER 31, 1994
- - --------------------------------------------------------------
(UNAUDITED) 1994 1993 1992 1991
1990
----------------- ------- ------- ------- -------
- - -------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period.......... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $
1.00
------- ------- ------- ------- -------
- - -------
INCOME FROM INVESTMENT OPERATIONS
- - ---------------------------------
Net investment income......................... .0191 .0244 .0256 .0421 .0640
.0765
Net realized gain on investments.............. -0- -0- .0001 -0- -0-
.0001
------- ------- ------- ------- -------
- - -------
Net increase in net assets from operations.... .0191 .0244 .0257 .0421 .0640
.0766
------- ------- ------- ------- -------
- - -------
LESS: DISTRIBUTIONS
- - -------------------
Dividends from net investment income.......... (.0191) (.0244) (.0256) (.0421) (.0640)
(.0765)
Distributions from net realized gains......... -0- -0- (.0001) -0- -0-
(.0001)
------- ------- ------- ------- -------
- - -------
Total dividends and distributions............. (.0191) (.0244) (.0257) (.0421) (.0640)
(.0766)
------- ------- ------- ------- -------
- - -------
Net asset value, end of period................ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $
1.00
======= ======= ======= ======= =======
=======
TOTAL RETURNS
- - -------------
Total investment return based on:
net asset value (a)......................... 3.83%(b) 2.48% 2.60% 4.30% 6.61%
7.96%
RATIOS/SUPPLEMENTAL DATA
- - ------------------------
Net assets, end of period (in millions)....... $ 2,069 $ 2,061 $ 1,783 $ 1,572 $ 1,070 $
584
Ratio of expenses to average net assets....... 1.00%(b)(c) 1.00%(d) 1.00% .95% .89%
.88%
Ratio of net investment income to
average net assets.......................... 3.81%(b)(c) 2.46%(d) 2.55% 4.17% 6.28%
7.65%
</TABLE>
- - --------------------------------------------------------------------------------
(a) 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.
(b) Annualized.
(c) If the fund had borne all expenses, the expense ratio would have
been 1.04%. The net investment income ratio would have been 3.77%.
(d) If the fund had borne all expenses, the expense ratio would have
been 1.04%. The net investment income ratio would have been 2.42%.
5
<PAGE>
ALLIANCE GOVERNMENT RESERVES
- - --------------------------------------------------------------------------------
TRUSTEES
DAVE H. WILLIAMS, Chairman
JOHN D. CARIFA
SAM Y. CROSS
CHARLES H.P. DUELL
WILLIAM H. FOULK, JR.
ELIZABETH J. MCCORMACK
DAVID K. STORRS
SHELBY WHITE
JOHN WINTHROP
OFFICERS
RONALD M. WHITEHILL, President
JOHN R. BONCZEK, Senior Vice President
ROBERT I. KURZWEIL, Senior Vice President
WAYNE D. LYSKI, Senior Vice President
PATRICIA NETTER, Senior Vice President
RONALD R. VALEGGIA, Senior Vice President
DREW BIEGEL, Vice President
DORIS T. CILIBERTI, Vice President
PAMELA F. RICHARDSON, Vice President
EDMUND P. BERGAN, JR., Secretary
MARK D. GERSTEN, Treasurer & Chief Financial Officer
PATRICK J. FARRELL, Controller
CUSTODIAN
STATE STREET BANK AND TRUST COMPANY
P.O. Box 1912
Boston, MA 02105
LEGAL COUNSEL
SEWARD & KISSEL
One Battery Park Plaza
New York, NY 10004
AUDITORS
MCGLADREY & PULLEN
555 Fifth Avenue
New York, NY 10017
TRANSFER AGENT
ALLIANCE FUND SERVICES, INC.
P.O. Box 1520
Secaucus, NJ 07096-1520
DISTRIBUTOR
ALLIANCE FUND DISTRIBUTORS, INC.
1345 Avenue of the Americas
New York, NY 10105
6
<PAGE>
[THIS PAGE INTENTIONALLY LEFT BLANK]
<PAGE>
ALLIANCE
GOVERNMENT
RESERVES
[LOGO ALLIANCECAPITAL APPEARS HERE]
SEMI-ANNUAL REPORT
DECEMBER 31, 1994
(UNAUDITED)
BULK RATE
U.S. POSTAGE
PAID
NEW YORK, NY
PERMIT NO. 7131
Alliance Government Reserves
1345 Avenue of the Americas, New York, NY 10105
Toll free 1-(800) 221-5672
YIELDS. For current recorded yield information on Alliance Government
Reserves, call on a touch-tone telephone toll-free (800) 251-0539 and press
the following sequence of keys:
[1] [#] [1] [#] [2] [5] [#]
For non-touch-tone telephones, call toll-free (800) 221-9513
- - ------------------------------------------------------------
[LOGO ALLIANCECAPITAL APPEARS HERE]
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.
ALC 501292
GOVSR
<PAGE>
<PAGE>
STATEMENT OF NET ASSETS
DECEMBER 31, 1994 (UNAUDITED) ALLIANCE TREASURY RESERVES
- - --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
(000) SECURITY+ YIELD VALUE
- - --------------------------------------------------------------------------------
<C> <S> <C> <C>
U.S. GOVERNMENT
OBLIGATIONS--73.1%
U.S. TREASURY NOTES--65.0%
$17,000 3.88%, 4/30/95....................... 5.80% $ 16,891,383
5,000 3.88%, 8/31/95....................... 5.62 4,944,583
29,000 4.13%, 5/31/95....................... 6.23 28,745,786
46,000 4.25%, 1/31/95....................... 5.29 45,954,026
45,000 5.50%, 2/15/95....................... 5.52 44,999,313
3,000 5.88%, 5/15/95....................... 5.38 3,004,887
20,000 7.75%, 2/15/95....................... 5.40 20,050,223
20,000 8.63%, 1/15/95....................... 5.05 20,024,508
------------
184,614,709
------------
U.S. TREASURY BILLS--8.1%
3,000 1/12/95.............................. 4.76 2,995,637
20,000 2/09/95.............................. 5.45 19,881,917
------------
22,877,554
------------
Total U.S. Government
Obligations
(amortized cost
$207,492,263)........................ 207,492,263
------------
REPURCHASE
AGREEMENTS--25.3%
BANKERS TRUST REPO
12,000 5.75%, dated 12/27/94,
due 1/03/95 in the amount
of $12,013,417 (cost
$12,000,000; collateralized
by $12,210,000 U.S. Treasury
Note, 4.25%, 7/31/95
value--$12,240,525).................. 5.75 12,000,000
GOLDMAN SACHS GROUP
13,000 5.80%, dated 12/20/94,
due 1/09/95 in the amount
of $13,041,889 (cost
$13,000,000; collateralized
by $13,015,000 U.S. Treasury
Note, 7.875%, 2/15/21
value--$13,268,793).................. 5.80 13,000,000
MERRILL LYNCH
GOVERNMENT SECURITIES, INC.
13,000 5.40%, dated 12/28/94,
due 1/04/95 in the amount
of $13,013,650 (cost
$13,000,000; collateralized
by $12,615,000 U.S. Treasury
Note, 8.25%, 7/15/98
value--$13,261,519).................. 5.40 13,000,000
MORGAN J.P. REPO
13,000 5.65%, dated 12/28/94,
due 1/04/95 in the amount
of $13,014,282 (cost
$13,000,000; collateralized
by $11,645,000 U.S. Treasury
Note, 8.875%, 2/15/19
value--$13,260,744).................. 5.65 13,000,000
MORGAN STANLEY GROUP, INC.
13,000 5.85%, dated 12/28/94,
due 1/04/95 in the amount
of $13,014,788 (cost
$13,000,000; collateralized
by $13,230,000 U.S. Treasury
Note, 6.125%, 7/31/96
value--$13,265,721).................. 5.85 13,000,000
STATE STREET REPO
8,000 5.25%, dated 12/30/94,
due 1/03/95 in the amount
of $8,004,667 (cost
$8,000,000; collateralized
by $7,775,000 U.S. Treasury
Note, 8.25%, 7/15/98
value--$8,162,504)................... 5.25 8,000,000
------------
Total Repurchase
Agreements
(amortized cost
$72,000,000)......................... 72,000,000
------------
TOTAL INVESTMENTS--98.4%
(amortized cost
$279,492,263)........................ 279,492,263
Other assets less
liabilities--1.6%.................... 4,425,637
------------
NET ASSETS--100%
(offering and redemption
price of $1.00 per share;
283,928,727 shares
outstanding)......................... $283,917,900
============
</TABLE>
- - --------------------------------------------------------------------------------
+ All securities either mature or their interest rate changes in one year or
less.
See notes to financial statements.
1
<PAGE>
STATEMENT OF OPERATIONS
SIX MONTHS ENDED DECEMBER 31, 1994 (UNAUDITED) ALLIANCE TREASURY RESERVES
- - --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C> <C>
INVESTMENT INCOME
Interest................................................... $4,341,018
EXPENSES
Advisory fee (Note B)...................................... $443,583
Distribution assistance and administrative service......... 279,529
Transfer agency............................................ 94,479
Registration expense....................................... 57,285
Custodian fees............................................. 34,291
Audit and legal fees....................................... 13,283
Trustees' fees............................................. 10,996
Printing................................................... 6,592
Amortization of organization expense....................... 4,594
Miscellaneous.............................................. 3,617
--------
Total expenses............................................. 948,249
Less: expense reimbursement and fee waiver................. (422,424) 525,825
-------- ----------
Net investment income...................................... 3,815,193
REALIZED LOSS ON INVESTMENTS
Net realized loss on investments........................... (8,239)
----------
NET INCREASE IN NET ASSETS FROM OPERATIONS.................... $3,806,954
==========
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
- - --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS ENDED SEPTEMBER 1, 1993*
DECEMBER 31, 1994 TO
(UNAUDITED) JUNE 30, 1994
----------------- ------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS
Net investment income............................... $3,815,193 $824,423
Net realized loss on investments.................... (8,239) (2,588)
------------ -----------
Net increase in net assets from operations.......... 3,806,954 821,835
DIVIDENDS TO SHAREHOLDERS FROM:
Net investment income............................... (3,815,193) (824,423)
TRANSACTIONS IN SHARES OF BENEFICIAL INTEREST
Net increase........................................ 203,206,313 80,722,414
------------ -----------
Total increase...................................... 203,198,074 80,719,826
NET ASSETS
Beginning of period................................. 80,719,826 -0-
------------ -----------
End of period....................................... $283,917,900 $80,719,826
============ ===========
</TABLE>
- - --------------------------------------------------------------------------------
* Commencement of operations.
See notes to financial statements.
2
<PAGE>
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1994 (UNAUDITED) ALLIANCE TREASURY RESERVES
- - --------------------------------------------------------------------------------
NOTE A: SIGNIFICANT ACCOUNTING POLICIES
Alliance Government 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 Government Reserves and Alliance Treasury Reserves
(the "Portfolio"). Each portfolio is considered to be a separate entity for
financial reporting and tax purposes. The following is a summary of significant
accounting policies followed by the Fund.
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.
2. ORGANIZATION EXPENSES
The organization expenses of the Portfolio are being amortized against income
on a straight-line basis through September, 1998.
3. TAXES
It is the Portfolio's policy to comply with 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
applicable, to its shareholders. Therefore, no provisions for federal income
or excise taxes are required.
4. DIVIDENDS
The Portfolio declares dividends daily 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.
5. GENERAL
Interest income is accrued as earned. Security transactions are recorded on a
trade date basis. Security gains and losses are determined on the identified
cost basis. It is the Portfolio's policy to take possession of securities as
collateral under repurchase agreements and to determine on a daily basis that
the value of such securities are sufficient to cover the value of the
repurchase agreements.
- - --------------------------------------------------------------------------------
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 of 1% on the first $1.25 billion of average
daily net assets; .49 of 1% on the next $.25 billion; .48 of 1% on the next
$.25 billion; .47 of 1% on the next $.25 billion; .46 of 1% on the next $1
billion; and .45 of 1% in excess of $3 billion.
The Adviser has agreed to reimburse the Portfolio to the extent that its
aggregate expenses (excluding taxes, brokerage, interest and, where
permitted, extraordinary expenses) exceed 1% of its average daily net assets
for any fiscal year. The Adviser also voluntarily agreed to reimburse the
Portfolio from July 1, 1994 to July 14, 1994 for expenses exceeding .40 of 1%
of its average daily net assets and from July 15, 1994 to December 31, 1994
for expenses exceeding .60 of 1% of its average daily net assets. For the six
months ended December 31, 1994, the reimbursement amounted to $200,632. The
Portfolio compensates Alliance Fund Services, Inc. (a wholly-owned subsidiary
of the Adviser) for providing personnel and facilities to perform transfer
agency services for the Portfolio. Such compensation amounted to $67,646 for
the six months ended December 31, 1994.
- - --------------------------------------------------------------------------------
NOTE C: DISTRIBUTION ASSISTANCE AND ADMINISTRATIVE SERVICES PLAN
Under this Plan, the Portfolio pays the Adviser a distribution fee at the
annual rate of up to .25% of 1% of the average daily value of the Portfolio's
net assets. The Plan provides that the Adviser will use such payments in
their entirety for distribution assistance and promotional activities. For
the six months ended December 31, 1994, the Portfolio made no payments under
the Plan. In addition, the Portfolio may reimburse certain broker-dealers for
administrative costs incurred in connection with providing shareholder
services, accounting and bookkeeping, and legal and compliance support. For
the six months ended December 31, 1994, such payments by the Portfolio
amounted to $57,737 of which $57,000 was paid to the Adviser.
3
<PAGE>
NOTES TO FINANCIAL STATEMENTS (CONTINUED) ALLIANCE TREASURY RESERVES
- - --------------------------------------------------------------------------------
NOTE D: INVESTMENT TRANSACTIONS
At December 31, 1994, the cost of securities for federal income tax purposes
was the same as the cost for financial reporting purposes. At June 30, 1994
the Portfolio had a capital loss carryforward of $2,588 which expires in 2002.
- - --------------------------------------------------------------------------------
NOTE E: TRANSACTIONS IN SHARES OF BENEFICIAL INTEREST
An unlimited number of shares ($.001 par value) are authorized. At December 31,
1994, capital paid-in aggregated $283,928,727. Transactions, all at $1.00 per
share, were as follows:
<TABLE>
<CAPTION>
SIX MONTHS ENDED SEPTEMBER 1, 1993(A)
DECEMBER 31, 1994 THROUGH
(UNAUDITED) JUNE 30, 1994
----------------- --------------------
<S> <C> <C>
Shares sold......................................... 703,907,766 232,199,197
Shares issued on reinvestments of dividends......... 3,745,080 820,489
Shares redeemed..................................... (504,446,533) (152,297,272)
------------ ------------
Net increase........................................ 203,206,313 80,722,414
============ ============
</TABLE>
- - --------------------------------------------------------------------------------
NOTE F: FINANCIAL HIGHLIGHTS
Selected data for a share outstanding throughout each period.
<TABLE>
<CAPTION>
SIX MONTHS ENDED SEPTEMBER 1, 1993(A)
DECEMBER 31, 1994 THROUGH
(UNAUDITED) JUNE 30, 1994
----------------- --------------------
<S> <C> <C>
Net asset value, beginning of period............................ $1.00 $1.00
-------- -------
INCOME FROM INVESTMENT OPERATIONS
- - ---------------------------------
Net investment income........................................... .0206 .0260
-------- -------
LESS: DISTRIBUTIONS
- - -------------------
Dividends from net investment income............................ (.0206) (.0260)
-------- -------
Net asset value, end of period.................................. $1.00 $1.00
======== =======
TOTAL RETURNS
- - -------------
Total investment return based on: net asset value (b)(c)........ 4.13% 3.18%
RATIOS/SUPPLEMENTAL DATA
- - ------------------------
Net assets, end of period (in thousands)........................ $283,918 $80,720
Ratio of expenses to average net assets (c)..................... .59%(d) .28%(e)
Ratio of net investment income to average net assets (c)........ 4.30%(d) 3.24%(e)
</TABLE>
- - --------------------------------------------------------------------------------
(a) Commencement of operations.
(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 in the last day of the period.
(c) Annualized.
(d) If the fund had borne all expenses, the expense ratio would have been
1.07%. The net investment income ratio would have been 3.82%.
(e) If the fund had borne all expenses, the expense ratio would have been
1.28%. The net investment income ratio would have been 2.24%.
4
<PAGE>
ALLIANCE TREASURY RESERVES
- - --------------------------------------------------------------------------------
TRUSTEES
DAVE H. WILLIAMS, Chairman
JOHN D. CARIFA
SAM Y. CROSS
CHARLES H.P. DUELL
WILLIAM H. FOULK, JR.
ELIZABETH J. MCCORMACK
DAVID K. STORRS
SHELBY WHITE
JOHN WINTHROP
OFFICERS
RONALD M. WHITEHILL, President
JOHN R. BONCZEK, Senior Vice President
ROBERT I. KURZWEIL, Senior Vice President
WAYNE D. LYSKI, Senior Vice President
PATRICIA NETTER, Senior Vice President
RONALD R. VALEGGIA, Senior Vice President
DREW BIEGEL, Vice President
DORIS T. CILIBERTI, Vice President
PAMELA F. RICHARDSON, Vice President
EDMUND P. BERGAN, JR., Secretary
MARK D. GERSTEN, Treasurer & Chief Financial Officer
PATRICK J. FARRELL, Controller
CUSTODIAN
STATE STREET BANK AND TRUST COMPANY
P.O. Box 1912
Boston, MA 02105
LEGAL COUNSEL
SEWARD & KISSEL
One Battery Park Plaza
New York, NY 10004
AUDITORS
MCGLADREY & PULLEN
555 Fifth Avenue
New York, NY 10017
TRANSFER AGENT
ALLIANCE FUND SERVICES, INC.
P.O. Box 1520
Secaucus, NJ 07096-1520
DISTRIBUTOR
ALLIANCE FUND DISTRIBUTORS, INC.
1345 Avenue of the Americas
New York, NY 10105
5
<PAGE>
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<PAGE>
[THIS PAGE INTENTIONALLY LEFT BLANK]
<PAGE>
ALLIANCE
TREASURY
RESERVES
[LOGO OF ALLIANCECAPITAL APPEARS HERE]
SEMI-ANNUAL REPORT
DECEMBER 31, 1994
(UNAUDITED)
Bulk Rate
U.S. Postage Paid
New York, NY
Permit No. 7131
Alliance Treasury Reserves
1345 Avenue of the Americas, New York, NY 10105
Toll free 1-(800) 221-5672
YIELDS. For current recorded yield information on Alliance
Treasury Reserves, call on a touch-tone telephone toll-free
(800) 251-0539 and press the following sequence of keys:
[1] [#] [1] [#] [9] [0] [#]
For non-touch-tone telephones, call toll-free (800) 221-9513
- - ------------------------------------------------------------
[LOGO OF ALLIANCECAPTIAL APPEARS HERE]
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.
ALC501299
TRSSR
