UNITED
CASH
MANAGEMENT,
INC.
SEMIANNUAL
REPORT
---------------------------------------
For the six months ended December 31, 1994
<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, 1994
Dear Shareholder:
As President of your Fund, I would like to take this opportunity to share
my thoughts on a subject that I believe is very important to all of us; the need
for tax incentives that will help Americans take personal responsibility for
their futures.
Voters all across America sent two clear messages in the elections held in
November 1994. They want their taxes reduced and they want their concern for
financial security addressed without adding new bureaucracies or government
programs. One of the methods to do this is to expand the availability of tax
incentives for individuals to invest in Individual Retirement Accounts. This
could be done in several ways such as:
restoring the universal availability of fully tax-deductible Individual
Retirement Accounts,
allowing non-working spouses to make a full contribution of $2,000 to an
Individual Retirement Account instead of only $250 as currently allowed,
eliminating the taxation on the distribution of earnings from Individual
Retirement Accounts.
All of us recognize that future generations will need to supplement social
security benefits by private savings in order to provide an adequate level of
retirement income. Expanding the benefits of IRA's provides tax incentives to
encourage savings which allows all individuals the opportunity to provide
financial security for themselves and their families. Encouraging savings
through tax incentives has additional indirect benefits. Americans' personal
savings rate has fallen from 8% in the 1960's to just 2% of disposable income
today. Expanding the benefits of IRA's will help reverse this trend, will
increase the amount of U.S. capital available for investment and should make the
U.S. less dependent on capital from foreign sources.
Changes to our current IRA laws, such as the ones I mentioned above, are
being discussed in Congress. I urge you to write to your Members of Congress
and to the President to tell them that you support expanded IRA legislation that
provides incentives and opportunities for all Americans to improve their
financial well being.
Finally, I appreciate your continued confidence in our products and
services.
Respectfully,
Keith A. Tucker
President
<PAGE>
THE INVESTMENTS OF
UNITED CASH MANAGEMENT, INC.
DECEMBER 31, 1994
Principal
Amount in
Thousands Value
BANK OBLIGATIONS
Certificates of Deposit
Domestic - 2.95%
PNC Bank, N.A.:
3.55%, 1-20-95 ........................ $ 5,000 $ 4,999,327
5.7%, 4-20-95 ......................... 5,000 4,994,011
Total ................................. 9,993,338
Eurodollar - 2.95%
NationsBank Corp. Europe,
5.4%, 5-19-95 ......................... 10,000 9,993,094
Yankee - 1.48%
Credit Suisse, New York,
4.03%, 2-17-95......................... 5,000 4,999,270
Total Certificates of Deposit - 7.38% 24,985,702
Notes - 5.16%
Abbey National Treasury Services plc,
7.4%, 12-15-95 ........................ 9,500 9,500,000
Comerica Bank,
5.83%, 10-27-95 ....................... 8,000 7,996,186
Total ................................. 17,496,186
TOTAL BANK OBLIGATIONS - 12.54% $ 42,481,888
(Cost: $42,481,888)
CORPORATE OBLIGATIONS
Commercial Paper
Building - 1.74%
Weyerhaeuser Company,
5.9%, 1-23-95 ......................... 5,900 5,878,727
Consumer Electronics and Appliances - 2.95%
TDK (USA) Corp.,
6.05%, 1-17-95 ........................ 10,000 9,973,111
Financial - 5.44%
Merrill Lynch & Co., Inc.,
5.72%, 1-17-95 ........................ 10,000 9,974,578
Nestle Capital Corp.,
5.9%, 1-31-95 ......................... 8,500 8,458,208
Total ................................. 18,432,786
See Notes to Schedule of Investments on page 8.
<PAGE>
THE INVESTMENTS OF
UNITED CASH MANAGEMENT, INC.
DECEMBER 31, 1994
Principal
Amount in
Thousands Value
CORPORATE OBLIGATIONS (Continued)
Commercial Paper (Continued)
Food and Related - 10.04%
General Mills, Inc.,
Master Note ........................... $13,520 $ 13,520,000
Quaker Oats Co.:
6.18%, 1-4-95 ......................... 2,000 1,998,970
5.75%, 1-17-95 ........................ 4,500 4,488,500
Sara Lee Corporation,
Master Note ........................... 14,005 14,005,000
Total ................................. 34,012,470
Paper - 1.38%
Kimberly-Clark Corp.,
5.9%, 1-23-95 ......................... 4,700 4,683,054
Public Utilities - Electric - 8.60%
Pacific Gas and Electric Co.,
6.0%, 1-13-95 ......................... 10,000 9,980,000
Pacificorp,
5.72%, 1-11-95 ........................ 10,000 9,984,111
Southern California Edison Company,
6.05%, 1-20-95 ........................ 9,200 9,170,624
Total ................................. 29,134,735
Telecommunications - 2.79%
Southwestern Bell Capital Corp.,
6.04%, 2-2-95 ......................... 9,500 9,448,996
Tobacco - 2.95%
Philip Morris, Incorporated,
5.72%, 1-19-95 ........................ 10,000 9,971,400
Total Commercial Paper - 35.89% 121,535,279
See Notes to Schedule of Investments on page 8.
<PAGE>
THE INVESTMENTS OF
UNITED CASH MANAGEMENT, INC.
DECEMBER 31, 1994
Principal
Amount in
Thousands Value
CORPORATE OBLIGATIONS (Continued)
Commercial Paper (backed by irrevocable
bank letter of credit)
Automotive - 3.09%
Hyundai Motor Finance Co. (Bank
of America NT & SA),
6.0%, 1-17-95 ......................... $10,500 $ 10,472,000
Financial - 2.21%
Spiegel Funding Corp. (Dresdner
Bank A.G.),
5.75%, 1-17-95 ........................ 7,500 7,480,834
Total Commercial Paper (backed by irrevocable
bank letter of credit) - 5.30% 17,952,834
Notes
Beverages - 2.96%
PepsiCo, Inc.,
5.845%, 1-3-95 ........................ 10,000 10,000,000
Financial - 5.31%
AVCO Financial Services Inc.,
5.87%, 1-3-95 ......................... 10,000 10,000,000
American Express Credit Corp.,
5.95%, 1-27-95 ........................ 8,000 8,007,438
Total 18,007,438
Public Utilities - Electric - 2.80%
Georgia Power Co.,
5.125%, 9-1-95 ........................ 9,500 9,459,339
Total Notes - 11.07% 37,466,777
TOTAL CORPORATE OBLIGATIONS - 52.26% $176,954,890
(Cost: $176,954,890)
MUNICIPAL OBLIGATIONS
California - 2.69%
City of Anaheim, California, Certificates
of Participation (1993 Arena Financing
Project), Municipal Adjustable Rate
Taxable Securities (Credit Suisse),
5.78%, 2-1-95 ......................... 9,100 9,100,000
See Notes to Schedule of Investments on page 8.
<PAGE>
THE INVESTMENTS OF
UNITED CASH MANAGEMENT, INC.
DECEMBER 31, 1994
Principal
Amount in
Thousands Value
MUNICIPAL OBLIGATIONS (Continued)
Georgia - 3.01%
Development Authority of Richmond
County (Georgia), Taxable Industrial
Revenue Bonds (NutraSweet Project),
Series 1990 (Union Bank of Switzerland),
5.71%, 6-2-95 ......................... $10,200 $ 10,200,000
Michigan - 3.54%
Michigan Underground Storage Tank Financial
Assurance Authority, State of Michigan,
Series 1 (Canadian Imperial Bank of Commerce),
6.4%, 1-11-95 ......................... 12,000 11,978,667
Missouri - 1.28%
Missouri Economic Development, Export
and Infrastructure Board, Taxable
Industrial Development Revenue Bonds
(Heilig-Meyers Company Project),
Series 1992 (AmSouth Bank N.A.),
6.25%, 1-4-95 ......................... 3,000 3,000,000
The Industrial Development Authority
of the County of St. Louis,
Missouri, Series 1991B (Citibank
of New York),
6.6%, 1-5-95 .......................... 1,335 1,335,000
Total ................................. 4,335,000
New Hampshire - 2.66%
The Industrial Development Authority
of the State of New Hampshire,
Pollution Control Revenue Bonds
(Public Service Company of New
Hampshire Project-1991 Taxable
Series D and E) (Barclays Bank),
6.45%, 2-14-95 ........................ 9,000 9,000,000
New York - 5.46%
Health Insurance Plan of Greater New York
(Morgan Guaranty Trust Company of New York),
6.45%, 1-4-95 ......................... 18,500 18,500,000
Texas - 2.94%
Metrocrest Hospital Authority, Series 1989A
(The Bank of New York),
6.118%, 1-20-95 ....................... 10,000 9,967,710
TOTAL MUNICIPAL OBLIGATIONS - 21.58% $ 73,081,377
(Cost: $73,081,377)
See Notes to Schedule of Investments on page 8.
<PAGE>
THE INVESTMENTS OF
UNITED CASH MANAGEMENT, INC.
DECEMBER 31, 1994
Principal
Amount in
Thousands Value
UNITED STATES GOVERNMENT OBLIGATIONS
Federal Home Loan Banks,
5.9%, 1-9-95 .......................... $14,000 $ 14,000,000
Federal Home Loan Mortgage Corporation,
5.95%, 3-7-95 ......................... 10,000 10,000,000
Federal National Mortgage Association,
5.9%, 3-20-95 ......................... 9,500 9,500,000
Student Loan Management Association,
5.94%, 1-3-95 ......................... 13,900 13,900,000
TOTAL UNITED STATES GOVERNMENT
OBLIGATIONS - 14.00% $ 47,400,000
(Cost: $47,400,000)
TOTAL INVESTMENT SECURITIES - 100.38% $339,918,155
(Cost: $339,918,155)
LIABILITIES, NET OF CASH AND OTHER ASSETS - (0.38%) (1,302,774)
NET ASSETS - 100.00% $338,615,381
Notes to Schedule of Investments
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, 1994
Assets
Investment securities - at value (Note 1) ........ $339,918,155
Cash ............................................ 829,456
Receivables:
Interest ........................................ 2,073,421
Fund shares sold ................................ 888,817
Prepaid insurance premium ........................ 21,426
------------
Total assets .................................. 343,731,275
------------
Liabilities
Payable for Fund shares redeemed ................. 4,906,106
Accrued transfer agency and dividend disbursing .. 133,870
Dividends payable ................................ 41,830
Accrued accounting services fee .................. 4,167
Other ............................................ 29,921
------------
Total liabilities ............................. 5,115,894
------------
Total net assets ............................. $338,615,381
============
Net Assets
$0.01 par value capital stock, authorized --
5,000,000,000; shares outstanding -- 338,615,381
Capital stock ................................... $ 3,386,154
Additional paid-in capital ...................... 335,229,227
------------
Net assets applicable to outstanding
units of capital ............................. $338,615,381
============
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, 1994
Investment Income
Interest ......................................... $8,302,803
----------
Expenses (Note 2):
Transfer agency and dividend disbursing ......... 773,522
Investment management fee ....................... 681,473
Custodian fees .................................. 25,865
Accounting services fee ......................... 25,000
Audit fees ...................................... 12,751
Legal fees ...................................... 4,328
Other ........................................... 88,877
----------
Total expenses ................................ 1,611,816
----------
Net investment income ........................ 6,690,987
----------
Net increase in net assets resulting
from operations ........................... $6,690,987
==========
See notes to financial statements.
<PAGE>
UNITED CASH MANAGEMENT, INC.
STATEMENT OF CHANGES IN NET ASSETS
For the For the
six months fiscal year
ended ended
December 31, June 30,
1994 1994
------------ ------------
Increase (Decrease) in Net Assets
Operations:
Net investment income ..............$ 6,690,987 $ 8,253,754
------------ ------------
Net increase in net assets
resulting from operations ....... 6,690,987 8,253,754
------------ ------------
Dividends to shareholders
from net investment income* ........ (6,690,987) (8,253,754)
------------ ------------
Capital share transactions:
Proceeds from sale of shares
(328,331,191 and 421,971,836
shares, respectively) ............ 328,331,191 421,971,836
Proceeds from reinvestment of
dividends (6,603,301 and
8,072,255 shares, respectively) ... 6,603,301 8,072,255
Payments for shares redeemed
(313,238,751 and 463,748,538
shares, respectively) ............(313,238,751) (463,748,538)
------------ ------------
Net increase (decrease) in net
assets resulting from capital
share transactions .............. 21,695,741 (33,704,447)
------------ ------------
Total increase (decrease) ....... 21,695,741 (33,704,447)
Net Assets
Beginning of period ................. 316,919,640 350,624,087
------------ ------------
End of period ....................... 338,615,381 316,919,640
============ ============
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---------------------------------------------
12/31/94 1994 1993 1992 1991 1990
------- ------- ------- ------- ------- -------
Net asset value,
beginning of
period ........... $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
------- ------- ------- ------- ------- -------
Net investment
income ........... 0.0204 0.0252 0.0251 0.0434 0.0665 0.0786
Less dividends
declared ......... (0.0204)(0.0252)(0.0251)(0.0434)(0.0665)(0.0786)
------- ------- ------- ------- ------- -------
Net asset value,
end of period .... $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
======= ======= ======= ======= ======= =======
Total return........ 2.10% 2.55% 2.57% 4.41% 6.89% 8.18%
Net assets, end of
period (000
omitted) .........$338,615$316,920$350,624$448,127$579,944$563,893
Ratio of expenses to
average net
assets ........... 0.99%* 1.04% 1.06% 0.99% 0.95% 0.95%
Ratio of net
investment income
to average net
assets ........... 4.10%* 2.51% 2.56% 4.36% 6.65% 7.86%
*Annualized.
See notes to financial statements.
<PAGE>
UNITED CASH MANAGEMENT, INC.
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1994
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 $11.0
billion of combined net assets at December 31, 1994) 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, 1994.
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 $5,806.
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, 1994, 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, 1994 by correspondence with the
custodian, provide a reasonable basis for the opinion expressed above.
PRICE WATERHOUSE LLP
Kansas City, Missouri
January 31, 1995
<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
Sharon K. Pappas, Vice President and Secretary
Richard K. Poettgen, Vice President
<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(12-94)
printed on recycled paper
