SCUDDER
INVESTMENTS
[LOGO]
Money Market
Scudder U.S. Treasury
Money Fund
Fund #059
Semiannual Report
November 30, 1999
The fund seeks current income consistent with safety, liquidity, and stability
of capital.
A no-load fund with no commissions to buy, sell, or exchange shares.
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Contents
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4 Letter from the Fund's President
6 Portfolio Management Discussion
10 Glossary of Investment Terms
11 Investment Portfolio
12 Financial Statements
15 Financial Highlights
16 Notes to Financial Statements
19 Officers and Trustees
20 Investment Products and Services
22 Scudder Solutions
2 | Scudder U.S. Treasury Money Fund
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Scudder U.S. Treasury Money Fund
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ticker symbol SCGXX fund number 059
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Date of o Reflecting the rising interest rate environment, the
Inception: total return of Scudder U.S. Treasury Money Fund
11/23/81 exceeded the total return of the average U.S. Treasury
money market fund for the six- and 12-month periods
Total Net ended November 30, 1999 according to Lipper Analytical
Assets as of Services, Inc.
11/30/99:
$419.2 million o As of the close of the six-month fiscal period, the
fund was providing a 4.84% 7-day yield and a 4.96%
7-day compounded effective yield.
o Management pursued a defensive investment strategy by
keeping a relatively short portfolio maturity for the
fund in anticipation of rising interest rates.
o The fund continued to hold the majority of assets in
repurchase agreements, which, due to their short
maturities, tended to reflect the rising rate
environment more quickly than longer-term money
market instruments.
3 | Scudder U.S. Treasury Money Fund
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Letter from the Fund's President
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Dear Shareholders,
In 1999 we witnessed another year of strong performance for the equity markets
as large-cap growth, especially technology stocks, recorded impressive returns.
Against the current backdrop of high consumer confidence, robust economic
growth, and low inflation, these generous returns have had the potential to make
other asset classes seem less important to an investor's overall portfolio.
However, we believe the role of a highly liquid and high quality holding has, in
fact, taken on renewed importance after such a prolonged rise for selected
equities. While we believe that the economy remains healthy overall, strong
gains in certain sectors can have the effect of unintentionally increasing one's
exposure to a particular asset class or industry sector. Given this potential,
we encourage shareholders to carefully review their holdings to ensure
appropriate allocations.
As a shareholder in Scudder U.S. Treasury Money Fund we believe that you already
hold a key element of a well-diversified portfolio. The fund's conservative,
high quality, and very liquid investments can provide relative stability,
current income, and a short-term parking place for a portion of your investment
portfolio. With short-term interest rates rising and inflation still relatively
low, investors are seeing some of the best real yields for money market funds in
years. For a detailed discussion of the fund's investment strategy and portfolio
positioning, I encourage
4 | Scudder U.S. Treasury Money Fund
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you to read the Portfolio Management Discussion with Frank Rachwalski, Dean
Meddaugh, and Christopher Proctor beginning on page 6.
For current information on the fund and your account, visit our Internet Web
site at www.scudder.com. There you'll find a wealth of information, including
the most recent performance of the fund, the latest news on Scudder products and
services, and the opportunity to perform account transactions. You can also
speak with one of our representatives by calling 1-800-SCUDDER (1-800-728-3337).
In closing, I would like to inform you that Daniel Pierce, president of the
fund, retired in June. At that time I assumed his role and responsibilities. We
are fortunate that Dan's long-standing affiliation with Scudder is ongoing, and
that we will continue to benefit from his counsel. I am pleased to join the
fund's team in this capacity, and look forward to serving your interests.
Thank you for your continued investment in Scudder U.S. Treasury Money Fund.
Sincerely,
/s/Lynn S. Birdsong
Lynn S. Birdsong
President,
Scudder U.S. Treasury Money Fund
5 | Scudder U.S. Treasury Money Fund
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Portfolio Management Discussion
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November 30, 1999
In the following interview, portfolio managers Frank Rachwalski, Dean Meddaugh,
and Christopher Proctor discuss the market environment and their approach to
managing the fund.
Q: The Federal Open Market Committee (FOMC), the Federal Reserve Bank's
implementer of economic policy, raised interest rates three times over the
six-month fiscal period. How did this affect money market securities?
A: The Fed's rate hikes have resulted in significant increases in the yields for
money market securities, and have contributed to the rise of the fund's yield.
Over the last six months the Fed effectively reversed its three rate cuts of
1998 with three quarter-point rate hikes (see "Changes in the Federal Funds
Rate" below). The reversal primarily reflects the effectiveness of the original
rate cuts, which were intended to stabilize the financial markets in the wake of
the Asian financial market crisis in the third quarter of 1998.
With U.S. economic growth continually exceeding expectations throughout most of
1999 and the financial markets rebounding strongly, Fed policy appeared
successful -- perhaps more successful than anticipated. Gross domestic product,
a measure of U.S. economic growth, grew a strong 4.27% for the 12-month period
ended September 30, 1999. Such strong growth can spark inflation but,
impressively, inflation has remained benign, increasing only 2.32% for the same
12-month period. However, there have been signs that inflationary pressures are
building, including the low levels of unemployment, rising oil prices, and
rising asset prices for real estate and selected stocks. As of the end of the
period, interest rates have returned to -- and exceeded -- levels existing prior
to the Asian crisis.
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Changes in the Federal Funds Rate
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Federal Funds Old rate New rate Change
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June 30 4.75% 5.00% +0.25%
August 24 5.00% 5.25% +0.25%
November 16 5.25% 5.50% +0.25%
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6 | Scudder U.S. Treasury Money Fund
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Q: How did you manage the fund in this environment?
A: Our primary focus has been on maintaining a sufficient level of liquidity
while taking advantage of what the market is offering. As a result, we
maintained a shorter average portfolio maturity for the fund than our average
peer fund. For example, at the end of the period the portfolio's average
maturity was 40 days versus 46 days for the average U.S. Treasury and repo money
market fund. Compared to the portfolio's average maturity of 47 days at the
beginning of the period, it remained little changed. By maintaining a shorter
maturity in the rising rate environment, our existing holdings matured more
quickly, which enabled us to invest in higher yielding securities sooner than if
we had maintained a longer average maturity. A limitation of this strategy is
that we gave up a small amount of current yield by maintaining a shorter
maturity.
Q: How did the fund perform?
A: Reflecting the rising interest rate environment, the Scudder U.S. Treasury
Money Fund's 7-day yield rose over the period from 4.17% to 4.84%, which
translate into compound effective yields of 4.26% and 4.96%, respectively. From
a total return standpoint, the fund exceeded the average return of U.S. Treasury
money market funds for both the six- and 12-month periods according to Lipper
Analytical Services, Inc.1 The fund returned 2.22% for the six months and 4.36%
for the 12 months, which compares to average U.S. Treasury money market fund
returns of 2.13% for 93 funds and 4.19% for 91 funds for the same periods,
respectively.
Q: In what kinds of securities can the fund invest?
A: The fund invests exclusively in short-term securities unconditionally
guaranteed by the U.S. government (as to payment of principal and interest) and
repurchase agreements backed fully by U.S. Treasury securities. While
1 Lipper is an independent analyst of investment performance. Performance
includes reinvestment of dividends and capital gains. Past performance
is no guarantee of future results.
7 | Scudder U.S. Treasury Money Fund
<PAGE>
an investment in the fund itself is not insured by the FDIC or guaranteed, these
securities are considered among the safest available due to the government
guarantee and relatively short maturities.
From a tax standpoint the fund offers an important benefit: income earned from
direct obligations of the U.S. government (primarily U.S. Treasuries) is
typically exempt from state and local income taxes. Most, but not all, states
allow this tax-exempt character of the fund's income to pass through to
shareholders so that distributions from the fund (to the extent derived from
interest that is exempt from state and local income taxes) are exempt from such
taxes. For the 1998 calendar year, 37.68% of income was derived from U.S.
Treasury obligations. The percentage for 1999 will be mailed to shareholders by
the end of January 2000. (Shareholders should consult their own tax advisers for
additional information about the tax treatment of interest from U.S. government
securities.)
Q: You are able to allocate the portfolio's assets across a variety of money
market instruments. How did you manage diversification?
A: The fund's allocation of investments remained essentially unchanged from six
months ago. The portfolio continues to be comprised of a selection of U.S.
government guaranteed short-term securities, including U.S. Treasury
obligations, U.S. government-backed securities, and repurchase agreements
collateralized by U.S. Treasury securities.
We continued to emphasize repurchase agreements (repos) in the portfolio, which
constituted 58% of net assets. These very short-term loans (usually seven days
or less) provide a private sector yield, or a yield that is comparable to
non-government issued money market securities. These securities tend to trade
more cheaply than comparable Treasury bills and often represent good value from
our standpoint. Because these securities are collateralized by Treasuries and
have relatively short maturities, repos tend to react quickly when interest
rates change. Our holdings
8 | Scudder U.S. Treasury Money Fund
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of repos benefited the portfolio as rates rose over the period.
Q: What is your outlook for interest rates?
A: While we did not expect the Fed to raise interest rates again in 1999 (the
Fed left rates unchanged at its December 21 meeting), we are expecting the trend
toward higher short-term rates to continue in early 2000. We think the Fed and
many investors remain concerned about the strong growth of the U.S. economy.
With an acceleration of growth in selected foreign countries and the Fed poised
to snuff out the first hint of higher inflation, we think there is a greater
likelihood of rate increases than not. In this environment, Treasury bill yields
are proportional to longer maturity securities and the market appears to be very
liquid. Based on this outlook, we expect to maintain the portfolio's slightly
defensive positioning while seeking to capitalize on attractive opportunities as
they arise.
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Fund Yields
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7-day 7-day
average compounded
yield effective yield
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May 31, 1999 4.17% 4.26%
November 30, 1999 4.84% 4.96%
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9 | Scudder U.S. Treasury Money Fund
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Glossary of Investment Terms
Federal Open The committee that sets interest rate and credit policies
Market for the Federal Reserve System. The committee decides
Committee whether to increase or decrease interest rates through
(FOMC) closely open-market operations. The committee's actions
watched and interpreted by economists and stock and bond
are market analysts, who try to predict whether the Fed is
seeking to tighten credit to reduce inflation or to loosen
credit to stimulate the economy.
Gross Gross domestic product is a commonly referenced measure of
Domestic the health of the U.S. economy and refers to the market
Product (GDP) value of the goods and services produced by labor
and property in the United States. Economic growth that is
overly strong can lead to accelerating inflation;
weakening growth can lead to a recession.
Inflation An overall increase in prices usually measured by the
Consumer Price Index (CPI) and the Producer Price Index
(PPI). CPI is calculated by the U.S. Bureau of Labor
Statistics and measures the cost of a basket of goods and
services over time. The PPI is calculated by the U.S.
Department of Labor and measures the wholesale cost of
goods over a specified period.
Repurchase An agreement between a seller and a buyer, usually of U.S.
Agreements government securities, whereby the seller agrees to
("Repo") repurchase the securities at an agreed-upon price and,
usually, at a stated time.
Treasuries Negotiable debt obligations of the U.S. government secured
by its full faith and credit and issued at various
schedules and maturities. These include Treasury bills,
notes, and bonds. The income from Treasury securities is
exempt from state and local, but not federal taxes.
(Source: Scudder Kemper Investments, Inc.; Barron's Dictionary of Finance and
Investment Terms)
Additional glossary terms are available at our Internet Web site --
www.scudder.com.
10 | Scudder U.S. Treasury Money Fund
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Investment Portfolio as of November 30, 1999 (Unaudited)
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Principal
Amount ($) Value ($)
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Repurchase Agreements 58.8%
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Goldman Sachs, Inc., 5.5%, to be repurchased
at $80,586,090 on 12/6/1999** .................. 80,500,000 80,500,000
Merrill Lynch, Inc., 5.46%, to be repurchased
at $70,010,617 on 12/1/1999** .................. 70,000,000 70,000,000
Morgan Stanley, Inc. 5.5%, to be repurchased
at $20,503,132 on 12/1/1999** .................. 20,500,000 20,500,000
Salomon Brothers, Inc., 5.45%, to be
repurchased at $60,445,083 on 1/18/2000** ...... 60,000,000 60,000,000
State Street Bank and Trust Company, 5.63%,
to be repurchased at $12,001,877 on 12/1/1999** 12,000,000 12,000,000
Total Repurchase Agreements (Cost $243,000,000) 243,000,000
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U.S. Treasury Obligations 23.1%
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U.S. Treasury Note, 5.375%, 1/31/2000 ............. 20,000,000 20,010,249
U.S. Treasury Notes, 5.625%, 4/30/2000 ............ 20,000,000 20,007,193
U.S. Treasury Note, 5.875%, 2/15/2000 ............. 30,000,000 30,044,300
U.S. Treasury Note, 6.75%, 4/30/2000 .............. 25,000,000 25,139,860
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Total U.S. Treasury Obligations (Cost $95,201,602) 95,201,602
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U.S. Government Backed Securities 18.1%
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Overseas Private Invest Corp.*, 5.6%, 4/2/2007
(Cost $74,500,000) ............................. 74,500,000 74,500,000
Total Investment Portfolio -- 100.0% (Cost $412,701,602) (a) 412,701,602
(a) The cost for federal income tax purposes was $412,701,602.
* Floating rate notes are securities whose yields vary with a designated
market index or market rate, such as the coupon-equivalent of the
Treasury bill rate. These securities are shown at their rate as of
November 30, 1999.
** Repurchase agreements are fully collateralized by U.S. Treasury or
Government agency securities.
The accompanying notes are an integral part of the financial statements.
11 | Scudder U.S. Treasury Money Fund
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Financial Statements
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Statement of Assets and Liabilities as of November 30, 1999
(Unaudited)
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Assets
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Investments in securities, at value (including repurchase
agreements of $243,000,000) (cost $412,701,602) ............ $412,701,602
Cash .......................................................... 5,261,750
Receivable for Fund shares sold ............................... 1,302,951
Interest receivable ........................................... 1,848,721
Other assets .................................................. 3,985
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Total assets .................................................. 421,119,009
Liabilities
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Payable for Fund shares redeemed .............................. 1,211,029
Dividends payable ............................................. 55,396
Accrued management fee ........................................ 155,843
Other accrued expenses ........................................ 460,314
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Total liabilities ............................................. 1,882,582
Net assets, at valu $419,236,427
Net Assets
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Net assets consist of:
Paid-in capital ............................................... 419,236,427
Net assets, at value $419,236,427
Net Asset Value
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NetAsset Value, offering and redemption price per share
($419,236,427 / 419,234,497 outstanding shares of
beneficial interest, $.01 par value, unlimited number
of shares authorized) ...................................... $ 1.00
The accompanying notes are an integral part of the financial statements.
12 | Scudder U.S. Treasury Money Fund
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Statement of Operations for the six months ended November 30, 1999
(Unaudited)
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Investment Income
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Interest ....................................................... $ 10,725,577
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Expenses:
Management fee ................................................. 1,062,303
Services to shareholders ....................................... 978,839
Custodian and accounting fees .................................. 42,709
Trustees' fees and expenses .................................... 20,975
Reports to shareholders ........................................ 37,656
Registration fees .............................................. 15,220
Auditing ....................................................... 15,342
Legal .......................................................... 6,418
Other .......................................................... 13,429
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Total expenses, before expense reductions ...................... 2,192,891
Expense reductions ............................................. (816,694)
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Total expenses, after expense reductions ....................... 1,376,197
Net investment income 9,349,380
Net increase (decrease) in net assets resulting from operations $ 9,349,380
The accompanying notes are an integral part of the financial statements.
13 | Scudder U.S. Treasury Money Fund
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Statements of Changes in Net Assets
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<TABLE>
<CAPTION>
Six Months
Ended
November 30, Eleven Months
Increase (Decrease) in Net 1999 Ended May 31, Year Ended
Assets (Unaudited) 1999 June 30, 1998
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Operations:
<S> <C> <C> <C>
Net investment income ........................................ $ 9,349,380 $ 16,657,996 $ 18,831,772
Net realized gain (loss) ..................................... -- 14,161 15,357
Net unrealized appreciation
(depreciation) on investments
during the period.......................................... -- (11,769) (15,067)
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Net increase (decrease) in net
assets resulting from
operations ................................................ 9,349,380 16,660,388 18,832,062
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Distributions to shareholders:
From net investment income ................................... (9,349,380) (16,657,996) (18,831,772)
------------- ------------- -------------
From net realized gains ...................................... -- (14,161) (15,357)
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Fund share transactions at net asset value of $1.00 per share:
Proceeds from shares sold .................................... 287,842,394 712,989,234 865,115,721
Reinvestment of distributions ................................ 8,909,174 15,776,229 17,248,372
Cost of shares redeemed ...................................... (304,143,255) (690,653,783) (892,417,877)
------------- ------------- -------------
Net increase (decrease) in net
assets from Fund share transactions ....................... (7,391,687) 38,111,680 (10,053,784)
------------- ------------- -------------
Increase (decrease) in net assets ............................ (7,391,687) 38,099,911 (10,068,851)
Net assets at beginning of period ............................ 426,628,114 388,528,203 398,597,054
Net assets at end of period .................................. $ 419,236,427 $ 426,628,114 $ 388,528,203
</TABLE>
The accompanying notes are an integral part of the financial statements.
14 | Scudder U.S. Treasury Money Fund
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Financial Highlights
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The following table includes selected data for a share outstanding throughout
each period and other performance information derived from the financial
statements.
<TABLE>
<CAPTION>
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1999(a) 1998(b) 1998(c) 1997(c) 1996(c) 1995(c) 1994(c)
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<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of period $1.000 $1.000 $1.000 $1.000 $1.000 $1.000 $1.000
-----------------------------------------------------------
Income from investment
operations:
Net investment income 022 .040 .047 .045 .048 .046 .027
Less distributions from:
Net investment income
and net realized gains
on investment
transactions (d) (.022) (.040) (.047) (.045) (.048) (.046) (.027)
Net asset value, end
of period $1.000 $1.000 $1.000 $1.000 $1.000 $1.000 $1.000
-----------------------------------------------------------
Total Return (%) (e) 2.22** 4.09** 4.83 4.58 4.91 4.70 2.74
Ratios to Average Net Assets and Supplemental Data
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Net assets, end of
period ($ millions) 419 427 389 399 396 383 383
Ratio of expenses before
expense reductions (%) 1.03* 1.08* 1.00 .94 .92 .90 .90
Ratio of expenses after
expense reductions (%) .65* .65* .65 .65 .65 .65 .65
Ratio of net investment
income (%) 4.40* 4.37* 4.72 4.49 4.80 4.61 2.75
</TABLE>
(a) For the six months ended November 30, 1999 (Unaudited).
(b) For the eleven months ended May 31, 1999. On August 10, 1998, the Board
of Trustees of the Fund changed the fiscal year end from June 30 to May
31.
(c) For the year ended June 30.
(d) Net realized capital gains were less than 6/10 of 1(cent) per share.
(e) Total returns would have been lower had certain expenses not been
reduced.
* Annualized
** Not annualized
15 | Scudder U.S. Treasury Money Fund
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Notes to Financial Statements
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A. Significant Accounting Policies
Scudder U.S. Treasury Money Fund (the "Fund") is registered under the Investment
Company Act of 1940, as amended (the "1940 Act"), as an open-end, diversified
management investment company organized as a Massachusetts business trust. On
August 10, 1998, the Fund changed its fiscal year end for financial reporting
and federal income tax purposes to May 31 from June 30.
The Fund's financial statements are prepared in accordance with generally
accepted accounting principles which require the use of management estimates.
The policies described below are followed consistently by the Fund in the
preparation of its financial statements.
Security Valuation. The Fund values all portfolio securities utilizing the
amortized cost method permitted in accordance with Rule 2a-7 under the 1940 Act
and pursuant to which the Fund must adhere to certain conditions. Under this
method, which does not take into account unrealized gains or losses on
securities, an instrument is initially valued at its cost and thereafter assumes
a constant accretion/amortization to maturity of any discount/premium.
All other securities are valued at their fair value as determined in good faith
by the Valuation Committee of the Board of Trustees.
Repurchase Agreements. The Fund may enter into repurchase agreements with
certain banks and broker/dealers whereby the Fund, through its custodian or
sub-custodian bank, receives delivery of the underlying securities, the amount
of which at the time of purchase and each subsequent business day is required to
be maintained at such a level that the market value is equal to at least the
principal amount of the repurchase price plus accrued interest.
Federal Income Taxes. The Fund's policy is to comply with the requirements of
the Internal Revenue Code, as amended, which are applicable to regulated
investment companies and to distribute all of its taxable income to its
shareholders. Accordingly, the Fund paid no federal income taxes and no federal
income tax provision was required.
Distribution of Income and Gains. All of the net investment income of the Fund
is declared as a daily dividend and is distributed to shareholders monthly. Net
realized gains from investment transactions, in excess of available capital loss
carryforwards, would be taxable to the Fund if not
16 | Scudder U.S. Treasury Money Fund
<PAGE>
distributed, and, therefore, will be distributed to shareholders at least
annually.
The timing and characterization of certain income and capital gains
distributions are determined annually in accordance with federal tax regulations
which may differ from generally accepted accounting principles. As a result, net
investment income (loss) and net realized gain (loss) on investment transactions
for a reporting period may differ significantly from distributions during such
period. Accordingly, the Fund may periodically make reclassifications among
certain of its capital accounts without impacting the net asset value of the
Fund.
Investment Transactions and Investment Income. Investment transactions are
accounted for on the trade date. Interest income is recorded on the accrual
basis. Realized gains and losses from investment transactions are recorded on an
identified cost basis. All discounts and premiums are accreted/amortized for
both tax and financial reporting purposes.
B. Related Parties
Under the Management Agreement (the "Agreement") with Scudder Kemper
Investments, Inc. ("Scudder Kemper" or the "Adviser"), the Adviser directs the
investments of the Fund in accordance with its investment objectives, policies,
and restrictions. The Adviser determines the securities, instruments, and other
contracts relating to investments to be purchased, sold, or entered into by the
Fund. In addition to portfolio management services, the Adviser provides certain
administrative services in accordance with the Agreement. The management fee
payable under the Agreement is equal to an annual rate of 0.50% of its average
daily net assets computed and accrued daily and payable monthly. In addition,
the Adviser has agreed to maintain the annualized expenses of the Fund at not
more than 0.65% of average daily net assets until September 30, 2000. For the
six months ended November 30, 1999, the Adviser did not impose a portion of its
fee amounting to $812,964, and the portion imposed amounted to $249,339.
Scudder Service Corporation ("SSC"), a subsidiary of the Adviser, is the
transfer, dividend paying and shareholder service agent for the Fund. For the
six months ended November 30, 1999, the amount charged to the Fund by SSC
aggregated $359,939, of which $58,064 is unpaid at November 30, 1999.
Scudder Trust Company ("STC"), a subsidiary of the Adviser, provides
recordkeeping and other services in connection with certain retirement and
17 | Scudder U.S. Treasury Money Fund
<PAGE>
employee benefit plans invested in the Fund. For the six months ended November
30, 1999, the amount charged to the Fund by STC aggregated $37,656, of which
$33,447 is unpaid at November 30, 1999.
Scudder Fund Accounting Corporation ("SFAC"), a subsidiary of the Adviser, is
responsible for determining the daily net asset value per share and maintaining
the portfolio and general accounting records of the Fund. For the six months
ended November 30, 1999, the amount charged to the Fund by SFAC aggregated
$26,317, of which $4,435 is unpaid at November 30, 1999.
The Fund pays each Trustee not affiliated with the Adviser an annual retainer
plus specified amounts for attended board and committee meetings. For the six
months ended November 30, 1999, Trustees' fees and expenses aggregated $20,975.
C. Expense Off-Set Arrangements
The Fund has entered into arrangements with its custodian and transfer agent
whereby credits realized as a result of uninvested cash balances were used to
reduce a portion of the Fund's expenses. During the period, the Fund's custodian
and transfer agent fees were reduced by $341 and $3,389, respectively, under
these arrangements.
D. Line of Credit
The Fund and several Scudder Funds (the "Participants") share in a $1 billion
revolving credit facility for temporary or emergency purposes, including the
meeting of redemption requests that otherwise might require the untimely
disposition of securities. The Participants are charged an annual commitment fee
which is allocated pro rata among each of the Participants. Interest is
calculated based on the market rates at the time of the borrowing. The Fund may
borrow up to a maximum of 33 percent of its net assets under the agreement.
18 | Scudder U.S. Treasury Money Fund
<PAGE>
Officers and Trustees
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Lynn S. Birdsong* Kathryn L. Quirk*
o President and Trustee o Trustee, Vice President and
Assistant Secretary
Henry P. Becton, Jr.
o Trustee; President and General Jean C. Tempel
Manager, WGBH Educational o Trustee; Venture Partner,
Foundation Internet Capital Group
Dawn-Marie Driscoll Ann M. McCreary*
o Trustee; Executive Fellow, Center o Vice President
for Business Ethics, Bentley
College; President, Driscoll Frank J. Rachwalski, Jr.*
Associates o Vice President
Peter B. Freeman John Millette*
o Trustee; Corporate Director o Vice President and Secretary
and Trustee
John R. Hebble*
George M. Lovejoy, Jr. o Treasurer
o Trustee; President and Director,
Fifty Associates; Chairman Caroline Pearson*
Emeritus, Meredith and Grew, Inc. o Assistant Secretary
Wesley W. Marple, Jr.
o Trustee; Professor of Business *Scudder Kemper Investments, Inc.
Administration, Northeastern
University, College of Business
Administration
19 | Scudder U.S. Treasury Money Fund
<PAGE>
Investment Products and Services
- --------------------------------------------------------------------------------
1-800-SCUDDER www.scudder.com
<TABLE>
<CAPTION>
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The Scudder Family of Funds+++
- --------------------------------------------------------------------------------
<S> <C>
Money Market U.S. Growth and Income
Scudder U.S. Treasury Money Fund Scudder Balanced Fund
Scudder Cash Investment Trust Scudder Dividend & Growth Fund
Scudder Money Market Series -- Scudder Growth and Income Fund
Prime Reserve Shares* Scudder Select 500 Fund
Premium Shares* Scudder S&P 500 Index Fund
Managed Shares* Scudder Real Estate Investment Fund
Scudder Government Money Market
Series -- Managed Shares* U.S. Growth
Value
Tax Free Money Market+ Scudder Large Company Value Fund
Scudder Tax Free Money Fund Scudder Value Fund***
Scudder Tax Free Money Market Scudder Small Company Value Fund
Series -- Managed Shares* Scudder Micro Cap Fund
Scudder California Tax Free Money Fund** Growth
Scudder New York Tax Free Money Fund** Scudder Classic Growth Fund***
Scudder Large Company Growth Fund
Tax Free+ Scudder Select 1000 Growth Fund
Scudder Limited Term Tax Free Fund Scudder Development Fund
Scudder Medium Term Tax Free Fund Scudder 21st Century Growth Fund
Scudder Managed Municipal Bonds
Scudder High Yield Tax Free Fund Global Equity
Scudder California Tax Free Fund** Worldwide
Scudder Massachusetts Limited Term Scudder Global Fund
Tax Free Fund** Scudder International Value Fund
Scudder Massachusetts Tax Free Fund** Scudder International Growth and
Scudder New York Tax Free Fund** Income Fund
Scudder Ohio Tax Free Fund** Scudder International Fund++
Scudder International Growth Fund
U.S. Income Scudder Global Discovery Fund***
Scudder Short Term Bond Fund Scudder Emerging Markets Growth Fund
Scudder GNMA Fund Scudder Gold Fund
Scudder Income Fund Regional
Scudder Corporate Bond Fund Scudder Greater Europe Growth Fund
Scudder High Yield Bond Fund Scudder Pacific Opportunities Fund
Scudder Latin America Fund
Global Income The Japan Fund, Inc.
Scudder Global Bond Fund
Scudder International Bond Fund Industry Sector Funds
Scudder Emerging Markets Income Fund Choice Series
Scudder Financial Services Fund
Asset Allocation Scudder Heath Care Fund
Scudder Pathway Conservative Portfolio Scudder Technology Fund
Scudder Pathway Balanced Portfolio
Scudder Pathway Growth Portfolio Preferred Series
Scudder Tax Managed Growth Fund
Scudder Tax Managed Small Company Fund
</TABLE>
20 | Scudder U.S. Treasury Money Fund
<PAGE>
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1-800-SCUDDER www.scudder.com
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Retirement Programs and Education Accounts
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Retirement Programs Education Accounts
Traditional IRA Education IRA
Roth IRA UGMA/UTMA
SEP-IRA
Keogh Plan
401(k), 403(b) Plans
Variable Annuities
Scudder Horizon Plan**+++ +++
Scudder Horizon Advantage**+++ +++ +++
<TABLE>
<CAPTION>
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Closed-End Funds#
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<S> <C>
The Argentina Fund, Inc. Montgomery Street Income Securities, Inc.
The Brazil Fund, Inc. Scudder Global High Income Fund, Inc.
The Korea Fund, Inc. Scudder New Asia Fund, Inc.
</TABLE>
For complete information on any of the above Scudder funds, including management
fees and expenses, call or write for a free prospectus. Read it carefully before
you invest or send money.
+++ Funds within categories are listed in order from expected least
risk to most risk. Certain Scudder funds or classes thereof may
not be available for purchase or exchange.
+ A portion of the income from the tax-free funds may be subject to
federal, state, and local taxes.
* A class of shares of the fund.
** Not available in all states.
*** Only the Scudder Shares of the fund are part of the Scudder Family
of Funds.
++ Only the International Shares of the fund are part of the Scudder
Family of Funds.
+++ +++ A no-load variable annuity contract provided by Charter National
Life Insurance Company and its affiliate, offered by Scudder's
insurance agencies, 1-800-225-2470.
+++ +++ +++ A no-load variable annuity contract issued by Glenbrook Life and
Annuity Company and underwritten by Allstate Financial Services,
Inc., sold by Scudder's insurance agencies, 1-800-225-2470.
# These funds, advised by Scudder Kemper Investments, Inc., are
traded on the New York Stock Exchange and, in some cases, on
various other stock exchanges.
21 | Scudder U.S. Treasury Money Fund
<PAGE>
<PAGE>
Scudder Solutions
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1-800-SCUDDER www.scudder.com
Convenient Automatic Investment Plan
ways to invest,
quickly and A convenient investment program in which money is
reliably electronically debited from your bank account monthly to
regularly purchase fund shares and "dollar cost average" --
buy more shares when the fund's price is lower and fewer
when it's higher, which can reduce your average purchase
price over time.*
Automatic Dividend Transfer
The most timely, reliable, and convenient way to purchase
shares -- use distributions from one Scudder fund to
purchase shares in another, automatically (accounts with
identical registrations or the same social security or tax
identification number).
QuickBuy
Lets you purchase Scudder fund shares electronically,
avoiding potential mailing delays; money for each of your
transactions is electronically debited from a previously
designated bank account.
Payroll Deduction and Direct Deposit
Have all or part of your paycheck -- even government checks
-- invested in up to four Scudder funds at one time.
* Dollar cost averaging involves continuous investment in
securities regardless of price fluctuations and does not
assure a profit or protect against loss in declining
markets. Investors should consider their ability to
continue such a plan through periods of low price
levels.
Around-the- Scudder Automated Information Line: SAIL(TM) --
clock electronic 1-800-343-2890
account
service and Personalized account information, the ability to exchange
information, or redeem shares, and information on other Scudder funds
including some and services via touchtone telephone.
transactions
Scudder's Web Site -- www.scudder.com
Personal Investment Organizer: Offering account information
and transactions, interactive worksheets, prospectuses and
applications for all Scudder funds, plus your current asset
allocation, whenever your need them. Scudder's site also
provides news about Scudder funds, retirement planning
information, and more.
22 | Scudder U.S. Treasury Money Fund
<PAGE>
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1-800-SCUDDER www.scudder.com
Retirees and Automatic Withdrawal Plan
those who depend
on investment You designate the bank account, determine the schedule (as
proceeds for frequently as once a month) and amount of the redemptions,
living expenses and Scudder does the rest.
can enjoy these
convenient, Distributions Direct
timely, and
reliable Automatically deposits your fund distributions into the
automated bank account you designate within three business days after
withdrawal each distribution is paid.
programs
QuickSell
Provides speedy access to your money by electronically
crediting your redemption proceeds to the bank account you
previously designated.
For more Call a Scudder representative at
information about 1-800-SCUDDER
these services
Or visit our Web site at
www.scudder.com
Please address The Scudder Funds
all written PO Box 2291
correspondence Boston, Massachusetts
to 02107-2291
23 | Scudder U.S. Treasury Money Fund
<PAGE>
About the Fund's Adviser
Scudder Kemper Investments, Inc. is one of the largest and most experienced
investment management organizations worldwide, managing more than $290 billion
in assets globally for mutual fund investors, retirement and pension plans,
institutional and corporate clients, insurance companies, and private family
and individual accounts.
Scudder Kemper Investments has a rich heritage of innovation, integrity, and
client-focused service. In 1997, Scudder, Stevens & Clark, Inc., founded over
80 years ago as one of the nation's first investment counsel organizations,
joined the Zurich Financial Services Group. As a result, Zurich's subsidiary,
Zurich Kemper Investments, Inc., with 50 years of mutual fund and investment
management experience, was combined with Scudder. Headquartered in New York,
Scudder Kemper Investments offers a full range of investment counsel and asset
management capabilities, based on a combination of proprietary research and
disciplined, long-term investment strategies. With its global investment
resources and perspective, the firm seeks opportunities in markets throughout
the world to meet the needs of investors.
Scudder Kemper Investments, Inc., the global asset management firm, is a member
of the Zurich Financial Services Group. The Zurich Financial Services Group is
an internationally recognized leader in financial services, including
property/casualty and life insurance, reinsurance, and asset management.
This information must be preceded or accompanied by a current prospectus.
Portfolio changes should not be considered recommendations for action by
individual investors.
SCUDDER
INVESTMENTS
[LOGO]
PO Box 2291
Boston, MA 02107-2291
1-800-SCUDDER
www.scudder.com
