<PAGE>
UNITED
CASH
MANAGEMENT,
INC.
SEMIANNUAL
REPORT
------------------------------------------
For the six months ended December 31, 1993
<PAGE>
This report is submitted for the general information of the shareholders of
United Cash Management, Inc. It is not authorized for distribution to
prospective investors in the Fund unless accompanied with or preceded by the
United Cash Management, Inc. current prospectus.
<PAGE>
PRESIDENT'S LETTER
- -----------------------------------------------------------------
DECEMBER 31, 1993
Dear Shareholder:
This report covers the investment performance of your Fund for the six
months ended December 31, 1993.
During the past six months, bond and equity markets have benefited from low
interest rates and minimal inflation. These markets will continue to react to
events that affect the economy such as the proposed deficit reduction program
and new taxes.
We are hoping to see improved economies throughout the world over the next
year. We believe this would contribute to a favorable outlook for U.S. and
foreign securities.
Regardless of the rise and decline of markets, we will continue to use the
strengths and abilities we have developed over the past 55 years. These
include:
Professional portfolio management-- As investment professionals, we pay
careful attention to economic trends; we understand the business of each company
in which we invest; and we have the ability to judge the management of such
companies as they adapt to changes in the industries and markets they serve.
A widely diversified approach-- Our extensive experience managing a variety
of securities allows us to see the whole "investment pie." We use this broad
view to consider every investment opportunity available that meets your Fund's
objectives, and to take advantage of these opportunities in an effort to achieve
maximum return.
These are just two of the many attributes that we bring to the table when
making investment decisions. We believe your Fund is designed appropriately to
meet its investment objectives, and can reward the long-term investor. We never
forget that we are managing your money.
The following is a comprehensive look at your Fund's recent performance.
We believe you will find that the information continues to reflect our aim of
meeting the stated objectives of your Fund.
Respectfully,
Keith A. Tucker
President
<PAGE>
THE INVESTMENTS OF
UNITED CASH MANAGEMENT, INC.
DECEMBER 31, 1993
Principal
Amount in
Thousands Value
BANK OBLIGATIONS
Certificates of Deposit
Domestic - 4.66%
PNC Bank, N.A.,
3.75%, 8-2-94 ......................... $ 5,000 $ 5,000,000
Royal Bank of Canada,
3.33%, 3-14-94 ........................ 10,000 10,000,000
Total ................................. 15,000,000
Eurodollar - 6.84%
Harris Trust and Savings Bank London,
3.3%, 4-20-94 ......................... 10,000 10,000,000
NationsBank Corp. Europe,
3.46%, 3-15-94 ........................ 12,000 12,000,000
Total ................................. 22,000,000
Yankee - 5.60%
Bank of Nova Scotia,
3.25%, 1-7-94.......................... 8,000 7,999,999
National Westminster Bank PLC,
3.34%, 1-4-94 ......................... 10,000 10,000,017
Total.................................. 18,000,016
Total Certificates of Deposit - 17.10% 55,000,016
Commercial Paper (backed by irrevocable bank
letter of credit) - 2.49%
Banco Real S.A., Grand Cayman (Barclays Bank PLC,
New York Branch),
3.25%, 1-6-94 ......................... 8,000 7,996,389
TOTAL BANK OBLIGATIONS - 19.59% $ 62,996,405
(Cost: $62,996,405)
CORPORATE OBLIGATIONS
Commercial Paper
Beverages - 1.55%
PepsiCo, Inc.,
3.3%, 1-7-94 .......................... 5,000 4,997,250
Consumer Electronics and Appliances - 2.78%
TDK (USA) Corp.:
3.34%, 1-18-94 ........................ 6,950 6,939,038
3.4%, 1-20-94 ......................... 2,000 1,996,411
Total ................................. 8,935,449
See Notes to Schedule of Investments on page 8.
<PAGE>
THE INVESTMENTS OF
UNITED CASH MANAGEMENT, INC.
DECEMBER 31, 1993
Principal
Amount in
Thousands Value
CORPORATE OBLIGATIONS (Continued)
Commercial Paper (Continued)
Financial - 7.17%
Associates Corporation of North America,
Master Note ........................... $ 105 $ 105,000
Bell Atlantic Financial Services Inc.,
3.37%, 1-18-94 ........................ 1,000 998,409
Block Financial Corp.,
3.25%, 1-21-94 ........................ 4,500 4,491,875
General Electric Capital Corp.,
3.25%, 1-26-94 ........................ 5,000 4,988,715
SAFECO Credit Co., Inc.,
3.2%, 1-12-94 ......................... 2,000 1,998,044
Sony Capital Corp.,
3.32%, 2-7-94 ......................... 2,000 1,993,176
Transamerica Finance Corp.:
3.34%, 1-26-94 ........................ 4,500 4,489,563
3.35%, 1-28-94 ........................ 4,000 3,989,950
Total ................................. 23,054,732
Food and Related - 7.26%
CPC International Inc.,
3.35%, 1-18-94......................... 8,000 7,987,344
Golden Peanut Co.,
3.32%, 2-8-94 ......................... 6,000 5,978,973
Sara Lee Corporation,
Master Note ........................... 9,405 9,405,000
Total ................................. 23,371,317
Metals and Mining - 2.33%
Aluminum Company of America,
3.19%, 1-10-94 ........................ 7,500 7,494,019
Public Utilities - Electric - 6.52%
Pacific Gas and Electric Co.,
3.34%, 1-20-94 ........................ 8,000 7,985,898
Potomac Electric Power Co.,
3.25%, 1-19-94 ........................ 6,000 5,990,250
Public Service Electric & Gas Co.,
3.2%, 1-21-94 ......................... 7,000 6,987,556
Total ................................. 20,963,704
Public Utilities - Gas - 5.37%
Michigan Consolidated Gas Co.,
3.4%, 2-4-94 .......................... 5,000 4,983,944
Northern Illinois Gas Co.,
3.18%, 1-7-94 ......................... 4,500 4,497,615
Questar Corp.:
3.37%, 1-12-94 ........................ 2,000 1,997,940
3.37%, 1-18-94 ........................ 5,800 5,790,770
Total ................................. 17,270,269
See Notes to Schedule of Investments on page 8.
<PAGE>
THE INVESTMENTS OF
UNITED CASH MANAGEMENT, INC.
DECEMBER 31, 1993
Principal
Amount in
Thousands Value
CORPORATE OBLIGATIONS (Continued)
Commercial Paper (Continued)
Retailing - 1.55%
K Mart Corporation,
3.32%, 1-21-94 ........................ $ 5,000 $ 4,990,778
Telecommunications - 5.90%
GTE Florida Inc.,
3.3%, 1-24-94 ......................... 8,000 7,983,133
NYNEX Corp.:
3.38%, 1-3-94 ......................... 3,000 2,999,437
3.2%, 1-12-94 ......................... 5,000 4,995,111
3.19%, 1-19-94 ........................ 3,000 2,995,215
Total ................................. 18,972,896
Total Commercial Paper - 40.43% 130,050,414
Commercial Paper (backed by irrevocable
bank letter of credit)
Automotive - 0.62%
Hyundai Motor Finance Co. (Bank of
America NT & SA),
3.37%, 1-12-94 ........................ 2,000 1,997,941
Electronics - 1.55%
SCI Systems Inc. (ABN-AMRO Bank N.V.),
3.25%, 1-18-94 ........................ 5,000 4,992,326
Financial - 0.84%
Minnetonka Limited Fund L.P., Series B
(Swiss Bank Corp.),
3.28%, 3-14-94 ........................ 2,700 2,682,288
Total Commercial Paper (backed by irrevocable
bank letter of credit) - 3.01% 9,672,555
Notes
Beverages - 1.55%
PepsiCo, Inc.,
7.875%, 1-3-94 ........................ 5,000 5,001,126
See Notes to Schedule of Investments on page 8.
<PAGE>
THE INVESTMENTS OF
UNITED CASH MANAGEMENT, INC.,
DECEMBER 31, 1993
Principal
Amount in
Thousands Value
CORPORATE OBLIGATIONS (Continued)
Notes (Continued)
Financial - 13.72%
American Telephone and Telegraph Capital Corp.,
3.48%, 9-23-94 ........................ $ 9,200 $ 9,200,000
Federal National Mortgage Association,
3.4%, 3-21-94 ......................... 9,500 9,500,000
International Business Machines Credit
Corp.,
3.25%, 2-14-94 ........................ 6,000 6,000,000
Merrill Lynch & Co., Inc.,
3.55%, 1-14-94 ........................ 10,000 10,000,000
Mobil Australia Finance Co.,
3.5%, 7-25-94 ......................... 9,200 9,423,921
Total ................................. 44,123,921
Telecommunications - 2.35%
U.S. West Communications, Inc.,
6.1%, 3-28-94 ......................... 7,500 7,546,386
Total Notes - 17.62% 56,671,433
TOTAL CORPORATE OBLIGATIONS - 61.06% $196,394,402
(Cost: $196,394,402)
MUNICIPAL OBLIGATIONS
City of Anaheim, California, Certificates of
Participation (1993 Arena Financing Project),
Adjustable Rate Taxable Securities,
3.45%, 3-1-94 ......................... 4,200 4,200,000
Development Authority of Richmond
County (Georgia), Taxable
Industrial Revenue Bonds
(NutraSweet Project), Series
1990 (Union Bank of Switzerland),
4.0%, 6-1-94 .......................... 9,500 9,500,000
Health Insurance Plan of Greater New York
(Morgan Guaranty Trust Company of New York),
3.5%, 1-5-94 (A) ...................... 18,500 18,500,000
Missouri Economic Development, Export
and Infrastructure Board, Taxable
Industrial Development Revenue Bonds
(Heilig-Meyers Company Project),
Series 1992 (AmSouth Bank N.A.),
3.55%, 1-5-94 ......................... 3,000 3,000,000
TOTAL MUNICIPAL OBLIGATIONS - 10.94% $ 35,200,000
(Cost: $35,200,000)
See Notes to Schedule of Investments on page 8.
<PAGE>
THE INVESTMENTS OF
UNITED CASH MANAGEMENT, INC.
DECEMBER 31, 1993
Principal
Amount in
Thousands Value
UNITED STATES GOVERNMENT OBLIGATIONS
Federal Home Loan Banks,
3.4%, 1-7-94 .......................... $14,000 $ 14,000,000
Student Loan Management Association,
3.34%, 1-4-94 ......................... 13,900 13,900,000
TOTAL UNITED STATES GOVERNMENT
OBLIGATIONS - 8.68% $ 27,900,000
(Cost: $27,900,000)
TOTAL INVESTMENT SECURITIES - 100.27% $322,490,807
(Cost: $322,490,807)
LIABILITIES, NET OF CASH AND OTHER ASSETS - (0.27%) (874,928)
NET ASSETS - 100.00% $321,615,879
Notes to Schedule of Investments
(A) Security is subject to an irrevocable put option.
Cost of investments owned is the same as that used for Federal income tax
purposes.
See Note 1 to financial statements for security valuation and other significant
accounting policies concerning investments.
<PAGE>
UNITED CASH MANAGEMENT, INC.
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1993
Assets
Investment securities - at value (Note 1) ........ $322,490,807
Cash ............................................ 827,179
Receivables:
Interest ........................................ 1,718,782
Fund shares sold ................................ 443,960
Prepaid insurance premium ........................ 22,252
------------
Total assets .................................. 325,502,980
------------
Liabilities
Payable for Fund shares redeemed ................. 3,730,598
Accrued transfer agency and dividend disbursing .. 131,072
Accrued accounting services fee .................. 4,167
Other ............................................ 21,264
------------
Total liabilities ............................. 3,887,101
------------
Total net assets ............................. $321,615,879
============
Net Assets
$0.01 par value capital stock, authorized --
5,000,000,000; shares outstanding -- 321,615,879
Capital stock ................................... $ 3,216,159
Additional paid-in capital ...................... 318,399,720
------------
Net assets applicable to outstanding
units of capital ............................. $321,615,879
============
Net asset value, redemption and offering price
per share ........................................ $1.00
=====
See notes to financial statements.
<PAGE>
UNITED CASH MANAGEMENT, INC.
STATEMENT OF OPERATIONS
For the Six Months Ended DECEMBER 31, 1993
Investment Income
Interest ......................................... $5,655,263
----------
Expenses (Note 2):
Transfer agency and dividend disbursing ......... 933,185
Investment management fee ....................... 708,361
Custodian fees .................................. 28,369
Accounting services fee ......................... 25,000
Audit fees ...................................... 12,844
Legal fees ...................................... 2,618
Other ........................................... 81,687
----------
Total expenses ................................ 1,792,064
----------
Net investment income ........................ 3,863,199
----------
Net increase in net assets resulting
from operations ........................... $3,863,199
==========
See notes to financial statements.
<PAGE>
UNITED CASH MANAGEMENT, INC.
STATEMENT OF CHANGES IN NET ASSETS
For the For the
six months fiscal year
ended ended
December 31, June 30,
1993 1993
------------ ------------
Decrease in Net Assets
Operations:
Net investment income ..............$ 3,863,199 $ 10,085,867
------------ ------------
Net increase in net assets
resulting from operations ....... 3,863,199 10,085,867
------------ ------------
Dividends to shareholders
from net investment income* ........ (3,863,199) (10,085,867)
------------ ------------
Capital share transactions:
Proceeds from sale of shares
(206,639,302 and 420,866,621
shares, respectively) ............ 206,639,302 420,866,621
Proceeds from reinvestment of
dividends (3,890,739 and
9,862,502 shares, respectively) ... 3,890,739 9,862,502
Payments for shares redeemed
(239,538,249 and 528,231,957
shares, respectively) ............(239,538,249) (528,231,957)
------------ ------------
Net decrease in net assets
resulting from capital
share transactions .............. (29,008,208) (97,502,834)
------------ ------------
Total decrease .................. (29,008,208) (97,502,834)
Net Assets
Beginning of period ................. 350,624,087 448,126,921
------------ ------------
End of period .......................$321,615,879 $350,624,087
============ ============
Undistributed net investment
income ........................... $--- $---
==== ====
*See "Financial Highlights" on page 12.
See notes to financial statements.
<PAGE>
UNITED CASH MANAGEMENT, INC.
FINANCIAL HIGHLIGHTS
For a Share of Capital Stock Outstanding
Throughout Each Period:
For the
six
months For the fiscal year ended June 30,
ended---------------------------------------------
12/31/93 1993 1992 1991 1990 1989
-------- ------- ------- ------- ------- -------
Net asset value,
beginning of period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
------- ------- ------- ------- ------- -------
Net investment income 0.0115 0.0251 0.0434 0.0665 0.0786 0.0805
Less dividends
declared ......... (0.0115)(0.0251)(0.0434)(0.0665)(0.0786)(0.0805)
------- ------- ------- ------- ------- -------
Net asset value,
end of period .... $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
======= ======= ======= ======= ======= =======
Total return........ 2.40%* 2.57% 4.41% 6.89% 8.18% 8.33%
Net assets, end of period
(000 omitted)....$321,616$350,624$448,127$579,944$563,893$445,156
Ratio of expenses to average
net assets ....... 1.06%* 1.06% 0.99% 0.95% 0.95% 1.00%
Ratio of net investment
income to average net
assets ........... 2.28%* 2.56% 4.36% 6.65% 7.86% 8.14%
*Annualized
See notes to financial statements.
<PAGE>
UNITED CASH MANAGEMENT, INC.
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1993
NOTE 1 -- Significant Accounting Policies
United Cash Management, Inc. (the "Fund") is registered under the
Investment Company Act of 1940 as a diversified, open-end management investment
company. The following is a summary of significant accounting policies
consistently followed by the Fund in the preparation of its financial
statements. The policies are in conformity with generally accepted accounting
principles.
A. Security valuation -- The Fund invests only in money market securities with
maturities or irrevocable put options within one year. The Fund uses the
amortized cost method of security valuation which is accomplished by
valuing a security at its cost and thereafter assuming a constant
amortization rate to maturity of any discount or premium.
B. Security transactions and related investment income -- Security
transactions are accounted for on the trade date (date the order to buy or
sell is executed). Securities gains and losses, if any, are calculated on
the identified cost basis. Interest income is recorded on the accrual
basis.
C. Federal income taxes -- It is the Fund's policy to distribute all of its
taxable income and capital gains to its shareholders and otherwise qualify
as a regulated investment company under the Internal Revenue Code.
Accordingly, no provision has been made for Federal income taxes.
D. Dividends to shareholders -- All of the Fund's net income is declared and
recorded by the Fund as dividends on each day to shareholders of record at
the time of the previous determination of net asset value. Dividends are
declared from the total of net investment income, plus or minus realized
gains or losses on portfolio securities. Since the Fund does not expect to
realize any long-term capital gains, it does not expect to pay any capital
gains distributions.
NOTE 2 -- Investment Management and Payments to Affiliated Persons
The Fund pays a fee for investment management services. The fee is
computed daily based on the net asset value at the close of business. The fee
consists of a "Group" fee computed each day on the combined net asset values of
all of the funds in the United Group of mutual funds (approximately $11.1
billion of combined net assets at December 31, 1993) at annual rates of .51% of
the first $750 million of combined net assets, .49% on that amount between $750
million and $1.5 billion, .47% between $1.5 billion and $2.25 billion, .45%
between $2.25 billion and $3 billion, .43% between $3 billion and $3.75 billion,
.40% between $3.75 billion and $7.5 billion, .38% between $7.5 billion and $12
billion, and .36% of that amount over $12 billion. The Fund accrues and pays
this fee daily.
Pursuant to assignment of the Investment Management Agreement between the
Fund and Waddell & Reed, Inc. ("W&R"), Waddell & Reed Investment Management
Company ("WRIMCO"), a wholly-owned subsidiary of W&R, serves as the Fund's
investment manager.
The Fund has an Accounting Services Agreement with Waddell & Reed Services
Company ("WARSCO"), a wholly-owned subsidiary of W&R. Under the agreement,
WARSCO acts as the agent in providing accounting services and assistance to the
Fund and pricing daily the value of shares of the Fund. For these services, the
Fund pays WARSCO a monthly fee of one-twelfth of the annual fee shown in the
following table.
Accounting Services Fee
Average
Net Asset Level Annual Fee
(all dollars in millions) Rate for Each Level
------------------------- -------------------
From $ 0 to $ 10 $ 0
From $ 10 to $ 25 $ 10,000
From $ 25 to $ 50 $ 20,000
From $ 50 to $ 100 $ 30,000
From $ 100 to $ 200 $ 40,000
From $ 200 to $ 350 $ 50,000
From $ 350 to $ 550 $ 60,000
From $ 550 to $ 750 $ 70,000
From $ 750 to $1,000 $ 85,000
$1,000 and Over $100,000
At present, the Fund operates under state expense requirements which limit
the amount of aggregate annual expenses, adjusted for certain excess expenses,
that the Fund may incur during its fiscal year. The Manager will reimburse the
Fund for any expenses in excess of the limitation. No such reimbursement is
required for the period ended December 31, 1993.
The Fund also pays WARSCO a monthly per account charge of $1.75 for each
shareholder account which was in existence at any time during the prior month
and $0.75 for each shareholder check it processed. The Fund also reimburses W&R
and WARSCO for certain out-of-pocket costs.
The Fund paid Directors' fees of $6,733.
W&R is an indirect subsidiary of Torchmark Corporation, a holding company,
and United Investors Management Company, a holding company, and a direct
subsidiary of Waddell & Reed Financial Services, Inc., a holding company.
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors and Shareholders of
United Cash Management, Inc.
In our opinion, the accompanying statement of assets and liabilities, including
the schedule of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of United Cash Management, Inc. (the
"Fund") at December 31, 1993, the results of its operations for the six months
then ended and the changes in its net assets and the financial highlights for
the periods indicated, in conformity with generally accepted accounting
principles. These financial statements and financial highlights (hereafter
referred to as "financial statements") are the responsibility of the Fund's
management; our responsibility is to express an opinion on these financial
statements based on our audits. We conducted our audits of these financial
statements in accordance with generally accepted auditing standards which
require that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits, which included
confirmation of securities at December 31, 1993 by correspondence with the
custodian, provide a reasonable basis for the opinion expressed above.
PRICE WATERHOUSE
Kansas City, Missouri
January 31, 1994
<PAGE>
To all IRA Planholders:
As required by law, income tax will automatically be withheld from any
distribution or withdrawal from an IRA unless you make a written election not to
have taxes withheld. The election may be made by submitting forms provided by
Waddell & Reed, Inc. which can be obtained from your Waddell & Reed
representative or by submitting Internal Revenue Service form W-4P. Once made,
an election can be revoked by providing written notice to Waddell & Reed, Inc.
If you elect not to have tax withheld you may be required to make payments of
estimated tax. Penalties may be imposed by the IRS if withholding and estimated
tax payments are not adequate.
<PAGE>
DIRECTORS
Ronald K. Richey, Birmingham, Alabama, Chairman of the Board
Henry L. Bellmon, Red Rock, Oklahoma
Dodds I. Buchanan, Boulder, Colorado
Jay B. Dillingham, Kansas City, Missouri
John F. Hayes, Hutchinson, Kansas
Glendon E. Johnson, Miami, Florida
William T. Morgan, Los Angeles, California
Doyle Patterson, Kansas City, Missouri
Keith A. Tucker, Overland Park, Kansas
Frederick Vogel, III, Milwaukee, Wisconsin
Paul S. Wise, Carefree, Arizona
Leslie S. Wright, Birmingham, Alabama
OFFICERS
Keith A. Tucker, President
Robert L. Hechler, Vice President
Henry J. Herrmann, Vice President
John M. Holliday, Vice President
Theodore W. Howard, Vice President and Treasurer
Rodney O. McWhinney, Vice President
Sharon K. Pappas, Vice President and Secretary
Richard K. Poettgen, Vice President
This report is submitted for the general information of the shareholders of
United Cash Management, Inc. It is not authorized for distribution to
prospective investors in the Fund unless accompanied with or preceded by the
United Cash Management, Inc. current prospectus.
<PAGE>
The United Group of Mutual Funds
United Cash Management, Inc.
United Government Securities Fund, Inc.
United Bond Fund
United Municipal Bond Fund, Inc.
United Continental Income Fund, Inc.
United Income Fund
United Municipal High Income Fund, Inc.
United High Income Fund, Inc.
United High Income Fund II, Inc.
United Accumulative Fund
United Vanguard Fund, Inc.
United New Concepts Fund, Inc.
United Science and Technology Fund
United International Growth Fund, Inc.
United Gold & Government Fund, Inc.
United Retirement Shares, Inc.
- ------------------------------------
FOR MORE INFORMATION:
Contact your representative, or your
local office as listed on your
Account Statement, or contact:
WADDELL & REED
CUSTOMER SERVICE
6300 Lamar Avenue
P.O. Box 29217
Shawnee Mission, KS 66201-9217
Toll-Free - (800)366-5465
Local - 236-1303
For Yield Information Only
Toll-Free - (800)366-4953
Local - 236-1307
NUR1010SA(12-93)
printed on recycled paper
