TRUST FOR FEDERAL SECURITIES, 497, 1995-03-08

TRUST FOR FEDERAL SECURITIES
497, 1995-03-08

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<PAGE> 1

FedFund
An Investment Portfolio Offered By
Trust for Federal Securities

<TABLE>
<S> <C>
Bellevue Park Corporate Center For purchase and redemption orders only call:
400 Bellevue Parkway 800-441-7450 (in Delaware: 302-791-5350).
Suite 100 For yield information call: 800-821-6006
Wilmington, DE 19809 (FedFund shares code: 30; FedFund Dollar
shares code: 31).
For other information call: 800-821-7432.
</TABLE>

The Fund's investment objective is to seek current income with liquidity
and security of principal. The Fund invests in a portfolio consisting of U.S.
Treasury bills, notes and other obligations issued or guaranteed by the U.S.
Government, its agencies or instrumentalities and repurchase agreements relating
to such obligations.

Fund shares may not be purchased by individuals directly, but institutional
investors may purchase shares for accounts maintained by individuals. In
addition to FedFund shares, investors may purchase FedFund "Dollar" shares which
accrue daily dividends in the same manner as FedFund shares but bear all fees
payable by the Fund to institutional investors for certain services they provide
to the beneficial owners of such shares. (See "Management of the Fund-Service
Organizations.")

PNC Institutional Management Corporation ("PIMC") and PNC Bank, National
Association ("PNC Bank") serve as the Fund's adviser and sub-adviser,
respectively. PFPC Inc. ("PFPC") and Provident Distributors, Inc. ("PDI") serve
as the Fund's administrators. PDI also serves as the Fund's distributor.
------------------------
SHARES OF THE FUND ARE NOT DEPOSITS OR OBLIGATIONS OF OR GUARANTEED, ENDORSED,
OR OTHERWISE SUPPORTED BY PNC BANK CORP. OR ITS AFFILIATES, OR THE U.S.
GOVERNMENT, AND ARE NOT FEDERALLY INSURED BY THE FEDERAL DEPOSIT
INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD OR ANY OTHER
AGENCY. AN INVESTMENT IN THE FUND INVOLVES INVESTMENT RISKS,
INCLUDING THE POSSIBLE LOSS OF PRINCIPAL. THERE CAN BE NO
ASSURANCE THAT IT WILL BE ABLE TO MAINTAIN ITS NET ASSET
VALUE OF $1.00 PER SHARE.
------------------------

This Prospectus briefly sets forth certain information about the Fund that
investors should know before investing. Investors are advised to read this
Prospectus and retain it for future reference. Additional information about the
Fund, contained in a Statement of Additional Information currently dated
February 28, 1995, has been filed with the Securities and Exchange Commission
and is available to investors without charge by calling the Fund at
800-821-7432. The Statement of Additional Information, as amended from time to
time, is incorporated in its entirety by reference into this Prospectus.
------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
------------------------
February 28, 1995
<PAGE> 2

BACKGROUND AND EXPENSE INFORMATION

Two classes of shares are offered by this Prospectus: FedFund shares and
FedFund Dollar shares. Shares of each class represent equal, pro rata interests
in the Fund and accrue daily dividends in the same manner except that the Dollar
shares bear fees payable by the Fund (at the rate of .25% per annum) to
institutional investors for services they provide to the beneficial owners of
such shares. (See "Management of the Fund--Service Organizations.")

EXPENSE SUMMARY

<TABLE>
<CAPTION>
FEDFUND
FEDFUND DOLLAR
SHARES SHARES
---------- ----------
<S> <C> <C> <C> <C>
ESTIMATED ANNUAL FUND OPERATING EXPENSES
(as a percentage of average net assets)
Management Fees (net of waivers)................................. .07% .07%
Other Expenses................................................... .11% .36%
Administration Fees (net of waivers)........................ .07% .07%
Shareholder Servicing Fees.................................. 0% .25%
Miscellaneous............................................... .04% .04%
--- ---
Total Fund Operating Expenses (net of waivers)................... .18% .43%
=== ===
</TABLE>

- ------------

<TABLE>
<CAPTION>
EXAMPLE 1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C> <C>
You would pay the following expenses on a $1,000 investment,
assuming (1) a 5% annual return and (2) redemption at the
end of each time period with respect to the following
shares:
FedFund shares: $2 $ 6 $10 $ 23
FedFund Dollar shares: $4 $14 $24 $ 54
</TABLE>

THE FOREGOING SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE
EXPENSES OR RATE OF RETURN. ACTUAL EXPENSES AND RATE OF RETURN MAY BE GREATER OR
LESSER THAN THOSE SHOWN.

The purpose of the foregoing table is to assist an investor in
understanding the various costs and expenses that an investor in the Fund will
bear directly or indirectly. In addition, institutional investors may charge
fees for providing shareholder administrative services in connection with their
customers' investment in FedFund Dollar shares. (For more complete descriptions
of the various costs and expenses, see "Management of the Fund" in this
Prospectus and the Statement of Additional Information and the financial
statements and related notes contained in the Statement of Additional
Information.) The investment adviser and administrators have waived advisory and
administration fees or have reimbursed the Fund for some or all of its operating
expenses pursuant to an agreement that extends to January 18, 1996. The
foregoing table gives effect to this agreement. It is anticipated that they may
continue to do so on a voluntary basis thereafter. Absent fee waivers for the
fiscal year ended October 31, 1994, the estimated "Total Fund Operating
Expenses" for FedFund Shares and FedFund Dollar Shares would have been .30% and
.55%, respectively, of the average net assets of the FedFund portfolio. The
foregoing table has not been audited by the Fund's independent accountants.

2
<PAGE> 3

FINANCIAL HIGHLIGHTS

The following financial highlights for FedFund Shares have been derived
from the financial statements of the Fund for the fiscal year ended October 31,
1994, and for each of the nine preceding fiscal years, and for FedFund Dollar
Shares for the fiscal year ended October 31, 1994 and for each of the nine
preceding fiscal years. The financial highlights for the fiscal years set forth
below have been audited by Coopers & Lybrand L.L.P. independent accountants
whose report on the financial statements and financial highlights (for the most
recent five years) of the Fund is included in the Statement of Additional
Information. The tables should be read in conjunction with the financial
statements and related notes included in the Statement of Additional
Information. Further information about the performance of the Fund is available
in the annual report to shareholders, which may be obtained without charge by
calling 800-821-7432.

TRUST FOR FEDERAL SECURITIES

FINANCIAL HIGHLIGHTS

(For a Share Outstanding Throughout Each Period)

FEDFUND SHARES
<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31,
----------------------------------------------------------------------------------------
1994 1993 1992 1991 1990 1989 1988
---------- ---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period.... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- ---------- ---------- ---------- ---------- ---------- ----------
Income From Investment Operations:
Net Investment Income................. .0377 .0308 .0397 .0637 .0800 .0891 .0703
Net Capital Gains..................... -- .0001 .0010 -- -- -- --
---------- ---------- ---------- ---------- ---------- ---------- ----------
Total From Investment Operations...... .0377 .0309 .0407 .0637 .0800 .0891 .0703
---------- ---------- ---------- ---------- ---------- ---------- ----------
Less Distributions:
Dividends to Shareholders from:
Net Investment Income................. (.0377) (.0308) (.0397) (.0637) (.0800) (.0891) (.0703)
Net Capital Gains..................... -- (.0001) (.0010) -- -- -- --
---------- ---------- ---------- ---------- ---------- ---------- ----------
Total Distributions................... (.0377) (.0309) (.0407) (.0637) (.0800) (.0891) (.0703)
---------- ---------- ---------- ---------- ---------- ---------- ----------
Net Asset Value, End of Period.......... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
========= ========= ========= ========= ========= ========= =========
Total Return.......................... 3.84% 3.12% 4.15% 6.56% 8.29% 9.29% 7.28%
Ratios/Supplemental Data
Net Assets, End of Period (in 000s)... $1,557,562 $1,290,971 $2,976,954 $1,918,966 $1,488,141 $1,786,196 $1,772,390
Ratio of Expenses to Average Net
Assets.............................. .18%(1) .20%(1) .27% .30% .30%(1) .30%(1) .30%(1)
Ratio of Net Investment Income to
Average Net Assets.................. 3.78% 3.08% 3.91% 6.36% 8.00% 8.91% 7.02%

1987 1986 1985
---------- ---------- ----------
<S> <C> <C> <C>
Net Asset Value, Beginning of Period....$ 1.00 $ 1.00 $ 1.00
---------- ---------- ----------
Income From Investment Operations:
Net Investment Income................. .0614 .0676 .0813
Net Capital Gains..................... -- -- --
---------- ---------- ----------
Total From Investment Operations...... .0614 .0676 .0813
---------- ---------- ----------
Less Distributions:
Dividends to Shareholders from:
Net Investment Income................. (.0614) (.0676) (.0813)
Net Capital Gains..................... -- -- --
---------- ---------- ----------
Total Distributions................... (.0614) (.0676) (.0813)
---------- ---------- ----------
Net Asset Value, End of Period..........$ 1.00 $ 1.00 $ 1.00
========= ========= =========
Total Return.......................... 6.32% 6.98% 8.44%
Ratios/Supplemental Data
Net Assets, End of Period (in 000s)...$2,108,838 $2,135,060 $1,644,635
Ratio of Expenses to Average Net
Assets.............................. .30%(1) .33% .35%(1)
Ratio of Net Investment Income to
Average Net Assets.................. 6.12% 6.70% 8.11%
</TABLE>

- ------------
(1) Without the waiver of advisory and administration fees, the ratios of
expenses to average daily net assets would have been .30%, .27%, .34%, .35%,
.32%, .32%, .42% and .39% respectively, for each of the years ended October
31, 1994, 1993, 1990, 1989, 1988, 1987, 1985 and 1984, respectively, for
FedFund shares.

3
<PAGE> 4

TRUST FOR FEDERAL SECURITIES
FINANCIAL HIGHLIGHTS
(For a Share Outstanding Throughout Each Period)
FEDFUND DOLLAR SHARES
<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31,
----------------------------------------------------------------------------
1994 1993 1992 1991 1990 1989 1988
-------- -------- -------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period.............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- ------- ------- ------- -------
Income From Investment Operations:
Net Investment Income........................... .0352 .0283 .0372 .0612 .0775 .0866 .0678
Net Capital Gains............................... -- .0001 .0010 -- -- -- --
-------- -------- -------- ------- ------- ------- -------
Total From Investment Operations................ .0352 .0284 .0382 .0612 .0775 .0866 .0678
-------- -------- -------- ------- ------- ------- -------
Less Distributions:
Dividends to Shareholders from:
Net Investment Income........................... (.0352) (.0283) (.0372) (.0612) (.0775) (.0866) (.0678)
Net Capital Gains............................... -- (.0001) (.0010) -- -- -- --
-------- -------- -------- ------- ------- ------- -------
Total Distributions............................. (.0352) (.0284) (.0382) (.0612) (.0775) (.0866) (.0678)
-------- -------- -------- ------- ------- ------- -------
Net Asset Value, End of Period.................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======== ======== ======== ======= ======= ======= =======
Total Return.................................... 3.59% 2.87% 3.90% 6.31% 8.04% 9.04% 7.02%
Ratios/Supplemental Data
Net Assets, End of Period (in 000s)............. $135,769 $169,877 $148,363 $62,842 $19,815 $15,473 $35,741
Ratio of Expenses to Average Net Assets......... .43%(1) .45%(1) .52% .55% .55%(1) .55%(1) .55%(1)
Ratio of Net Investment Income to Average Net
Assets........................................ 3.51% 2.83% 3.66% 6.11% 7.75% 8.66% 6.77%

1987 1986 1985
------- ------- -------
<S> <C<C> <C> <C>
Net Asset Value, Beginning of Period.............. $ 1.00 $ 1.00 $ 1.00
------- ------- -------
Income From Investment Operations:
Net Investment Income........................... .0589 .0651 .0797
Net Capital Gains............................... -- -- --
------- ------- -------
Total From Investment Operations................ .0589 .0651 .0797
------- ------- -------
Less Distributions:
Dividends to Shareholders from:
Net Investment Income........................... (.0589) (.0651) (.0797)
Net Capital Gains............................... -- -- --
------- ------- -------
Total Distributions............................. (.0589) (.0651) (.0797)
------- ------- -------
Net Asset Value, End of Period.................... $ 1.00 $ 1.00 $ 1.00
======= ======= =======
Total Return.................................... 6.05% 6.71% 8.26%
Ratios/Supplemental Data
Net Assets, End of Period (in 000s)............. $29,372 $37,131 $44,736
Ratio of Expenses to Average Net Assets......... .55%(1) .58%(1) .41%(1)
Ratio of Net Investment Income to Average Net
Assets........................................ 5.87% 6.45% 7.91%
</TABLE>

- ------------
(1) Without the waiver of advisory and administration fees, the ratio of
expenses to average daily net assets would have been .55%, .52%, .59%, .60%,
.57%, .57%, 67% and .64% (annualized), respectively, for each of the years
ended October 31, 1994, 1993, 1990, 1989, 1988, 1987 and 1985, and the
period ended October 31, 1984, respectively, for FedFund Dollar shares.

4
<PAGE> 5

INVESTMENT OBJECTIVE AND POLICIES

The Fund's investment objective is to seek current income with liquidity
and security of principal. The Fund invests in obligations issued or guaranteed
by the U.S. Government, its agencies or instrumentalities (in addition to direct
Treasury obligations) and repurchase agreements relating to such obligations.
Portfolio securities held by the Fund have remaining maturities of 397 days
(thirteen months) or less (with certain exceptions), subject to the quality,
diversification, and other requirements of Rule 2a-7 under the Investment
Company Act of 1940, as amended (the "1940 Act") and other rules of the
Securities and Exchange Commission (the "SEC").

The "instrumentalities" or "agencies" of the U.S. Government the
obligations of which may be purchased by FedFund include: the Central Bank for
Cooperatives, Export-Import Bank of the United States, Farmers Home
Administration, Federal Farm Credit Banks, Federal Financing Bank, Federal Home
Loan Banks, Federal Home Loan Mortgage Corporation, Federal Housing
Administration, Federal Intermediate Credit Banks, Federal Land Banks, Federal
National Mortgage Association, Financing Corporation, General Services
Administration, Government National Mortgage Association, International Bank for
Reconstruction and Development, Maritime Administration, Private Export Funding
Corp., Resolution Trust Company, Small Business Administration, Student Loan
Marketing Association, Tennessee Valley Authority and Washington D.C. Armory
Board. Some obligations issued or guaranteed by agencies or instrumentalities of
the U.S. Government are backed by the full faith and credit of the United
States; others are backed by the right of the issuer to borrow from the U.S.
Treasury or are backed only by the credit of the agency or instrumentality
issuing the obligation.

Securities issued or guaranteed by the U.S. Government, its agencies and
instrumentalities have historically involved little risk of loss of principal if
held to maturity. However, due to fluctuations in interest rates, the market
value of such securities may vary during the period a shareholder owns shares of
the Fund. Certain government securities held by the Fund may have remaining
maturities exceeding thirteen months if such securities provide for adjustments
in their interest rates not less frequently than every thirteen months. To the
extent consistent with its investment objectives, the Fund may invest in
Treasury receipts and other "stripped" securities issued or guaranteed by the
U.S. Government, where the principal and interest components are traded
independently under the Separate Trading of Registered Interest and Principal of
Securities program ("STRIPS"). Under the STRIPS program, the principal and
interest components are individually numbered and separately issued by the U.S.
Treasury at the request of depository financial institutions, which then trade
the component parts independently. Currently, the Fund only invests in
"stripped" securities issued or guaranteed by the U.S. Government which are
registered under the STRIPS program.

The Fund may purchase government securities from financial institutions,
such as banks and broker-dealers, subject to the seller's agreement to
repurchase them at an agreed upon time and price ("repurchase agreements"). The
securities subject to a repurchase agreement may bear maturities exceeding
thirteen months, provided the repurchase agreement itself matures in one year or
less. The Fund will not invest more than 10% of the value of its net assets in
repurchase agreements which do not provide for settlement within seven days. The
seller under a repurchase agreement will be required to maintain the value of
the securities subject to the agreement at not less than the repurchase price
(including accrued interest). Default by or bankruptcy of the seller

5
<PAGE> 6

would, however, expose the Fund to possible loss because of adverse market
action or delay in connection with the disposition of the underlying
obligations.

The Fund may borrow funds for temporary purposes by entering into reverse
repurchase agreements in accordance with the investment restrictions described
below. Pursuant to such agreements, the Fund would sell portfolio securities to
financial institutions and agree to repurchase them at an agreed upon date and
price. The Fund would consider entering into reverse repurchase agreements to
avoid otherwise selling securities during unfavorable market conditions to meet
redemptions. Reverse repurchase agreements involve the risk that the market
value of the portfolio securities sold by the Fund may decline below the price
of the securities the Fund is obligated to repurchase.

The Fund may purchase securities on a "when-issued" basis. When-issued
securities are securities purchased for delivery beyond the normal settlement
date at a stated price and yield. The Fund will generally not pay for such
securities or start earning interest on them until they are received. Securities
purchased on a when-issued basis are recorded as an asset and are subject to
changes in value based upon changes in the general level of interest rates. The
Fund expects that commitments to purchase when-issued securities will not exceed
25% of the value of its total assets absent unusual market conditions. The Fund
does not intend to purchase when-issued securities for speculative purposes but
only in furtherance of its investment objective.

The Fund may also lend its portfolio securities to financial institutions
in accordance with the investment restrictions described below. Such loans would
involve risks of delay in receiving additional collateral or in recovering the
securities loaned or even loss of rights in the collateral should the borrower
of the securities fail financially. However, loans will be made only to
borrowers deemed by the Fund's investment adviser to be of good standing and
only when, in the adviser's judgment, the income to be earned from the loans
justifies the attendant risks.

INVESTMENT LIMITATIONS

The Fund's investment objective and policies described above are not
fundamental and may be changed by the Company's Board of Trustees without a vote
of shareholders. If there is a change in the investment objective, shareholders
should consider whether the Fund remains an appropriate investment in light of
their then current financial position and needs. The Fund's investment
limitations summarized below may not be changed without the affirmative vote of
the holders of a majority of its outstanding shares. (A complete list of the
investment limitations that cannot be changed without a vote of shareholders is
contained in the Statement of Additional Information under "Investment
Objectives and Policies.")

The Fund may not:

1. Purchase securities other than U.S. Treasury bills, notes and
other obligations issued or guaranteed by the U.S. Government, its agencies
or instrumentalities, some of which may be subject to repurchase
agreements.

2. Borrow money except from banks for temporary purposes and then in
an amount not exceeding 10% of the value of the Fund's total assets, or
mortgage, pledge or hypothecate its assets except in connection with any
such borrowing and in amounts not in excess of the lesser of the dollar
amounts borrowed or 10% of the value of the Fund's total assets at the time
of such borrowing.

6
<PAGE> 7

3. Make loans except that the Fund may purchase or hold debt
obligations in accordance with its investment objective and policies, may
enter into repurchase agreements for securities and may lend portfolio
securities against collateral consisting of cash or securities which are
consistent with the Fund's permitted investments, which is equal at all
times to at least 100% of the value of the securities loaned. There is no
investment restriction on the amount of securities that may be loaned,
except that payments received on such loans, including amounts received
during the loan on account of interest on the securities loaned, may not
(together with all non-qualifying income) exceed 10% of the Fund's annual
gross income (without offset for realized capital gains) unless, in the
opinion of counsel to the Company, such amounts are qualifying income under
federal income tax provisions applicable to regulated investment companies.

PURCHASE AND REDEMPTION OF SHARES

PURCHASE PROCEDURES

Fund shares are sold at the net asset value per share next determined after
receipt of a purchase order by PFPC, the Fund's transfer agent. Purchase orders
for shares are accepted by the Fund only on days on which both New York Stock
Exchange and the Federal Reserve Bank of Philadelphia are open for business (a
"Business Day") and must be transmitted to PFPC in Wilmington, Delaware, by
telephone (800-441-7450; in Delaware: 302-791-5350); or through the Fund's
computer access program. Orders received before 12:00 noon, Eastern time, for
which payment has been received by PNC Bank, the Fund's custodian, will be
executed at 12:00 noon. Orders received after 12:00 noon and before 2:30 P.M.,
Eastern time, (or orders received earlier in the same day for which payment has
not been received by 12:00 noon) will be executed at 4:00 P.M., Eastern time, if
payment has been received by PNC Bank by that time. Orders received at other
times, and orders for which payment has not been received by 4:00 P.M., Eastern
time, will not be accepted, and notice thereof will be given to the institution
placing the order. (Payment for orders which are not received or accepted will
be returned after prompt inquiry to the sending institution.) The Fund may in
its discretion reject any order for shares.

Payment for Fund shares may be made only in federal funds or other funds
immediately available to PNC Bank. The minimum initial investment by an
institution is $5,000; however, broker-dealers and other institutional investors
may set a higher minimum for their customers. There is no minimum subsequent
investment.

Conflict of interest restrictions may apply to an institution's receipt of
compensation paid by the Fund on fiduciary funds that are invested in Dollar
shares. (See also "Management of the Fund--Service Organizations.")
Institutions, including banks regulated by the Comptroller of the Currency and
investment advisers and other money managers subject to the jurisdiction of the
SEC, the Department of Labor or state securities commissions, should consult
their legal advisors before investing fiduciary funds in Dollar shares. (See
also "Management of the Fund--Banking Laws.")

REDEMPTION PROCEDURES

7
<PAGE> 8

best efforts to maintain its net asset value per share at $1.00, the proceeds
paid to a shareholder upon redemption may be more or less than the amount
invested depending upon a share's net asset value at the time of redemption.

Payment for redeemed shares for which a redemption order is received by
PFPC before 12:00 noon, Eastern time, on a Business Day is normally made in
federal funds wired to the redeeming shareholder on the same day. A shareholder
of record located in the Pacific Time Zone or Mountain Time Zone may receive
redemption proceeds wired the same day in federal funds to a destination within
such time zone if its redemption order is received before 2:30 P.M., Eastern
time, or 1:30 P.M., Eastern time, respectively. Payment for other redemption
orders which are received between 12:00 noon and 4:00 P.M., Eastern time, or on
a day when PNC Bank is closed, is normally wired in federal funds on the next
day following redemption that PNC Bank is open for business.

The Fund shall have the right to redeem shares in any account if the value
of the account is less than $1,000 after sixty-days' prior written notice to the
shareholder. Any such redemption shall be effected at the net asset value per
share next determined after the redemption order is entered. If during the sixty
day period the shareholder increases the value of its account to $1,000 or more,
no such redemption shall take place. In addition, the Fund may redeem shares
involuntarily or suspend the right of redemption under certain special
circumstances described in the Statement of Additional Information under
"Additional Purchase and Redemption Information."

OTHER MATTERS

The Fund's net asset value per share for purposes of pricing purchase and
redemption orders is determined by PIMC as of 12:00 noon and 4:00 P.M., Eastern
time, on each day on which both the Federal Reserve Bank of Philadelphia and the
New York Stock Exchange are open for business. Currently, one or both of these
institutions are closed on New Year's Day, Martin Luther King, Jr. Day,
Presidents' Day, Good Friday, Memorial Day (observed), Independence Day
(observed), Labor Day, Columbus Day, Veterans Day, Thanksgiving Day and
Christmas Day (observed). The net asset value per share of each class of the
Fund is calculated by adding the value of all securities and other assets
belonging to the Fund, subtracting liabilities attributable to each class, and
dividing the result by the total number of the outstanding shares of each class.
In computing net asset value, the Fund uses the amortized cost method of
valuation as described in the Statement of Additional Information under
"Additional Purchase and Redemption Information." The Fund's net asset value per
share for purposes of pricing purchase and redemption orders is determined
independently of the net asset values of the shares of the Company's other
investment portfolios.

Fund shares are sold and redeemed without charge by the Fund. Institutional
investors purchasing or holding Fund shares for their customer accounts may
charge customers fees for cash management and other services provided in
connection with their accounts. A customer should, therefore, consider the terms
of its account with an institution before purchasing Fund shares. An institution
purchasing or redeeming shares on behalf of its customers is responsible for
transmitting orders to the Fund in accordance with its customer agreements.

8
<PAGE> 9

MANAGEMENT OF THE FUND

BOARD OF TRUSTEES

The business and affairs of the Fund are managed under the direction of the
Company's Board of Trustees. The trustees of the Company are as follows:

Philip E. Coldwell is an economic consultant and a former Member of
the Board of Governors of the Federal Reserve System.

Robert R. Fortune is a financial consultant and former Chairman,
President and Chief Executive Officer of Associated Electric & Gas
Insurance Services Limited.

Rodney D. Johnson is President of Fairmount Capital Advisors, Inc.

G. Willing Pepper, Chairman of the Board and President of the Company,
is a retired President of Scott Paper Company.

Anthony M. Santomero is the Richard K. Mellon Professor of Finance at
The Wharton School, University of Pennsylvania.

David R. Wilmerding, Jr., Vice Chairman of the Board of the Company,
is President and Chief Executive Officer of Gates, Wilmerding, Carper &
Rawlings, Inc.

Mr. Pepper is considered by the Company to be an "interested person" of the
Company as defined in the 1940 Act.

The other officers of the Company are as follows:

Edward J. Roach is Vice President and Treasurer of the Company.

W. Bruce McConnel, III, Secretary of the Company, is a partner of the
law firm of Drinker Biddle & Reath, Philadelphia, Pennsylvania.

INVESTMENT ADVISER AND SUB-ADVISER

PIMC, a wholly owned subsidiary of PNC Asset Management Group, Inc., which
is in turn a wholly owned subsidiary of PNC Bank, serves as the Fund's
investment adviser. PIMC was organized in 1977 by PNC Bank to perform advisory
services for investment companies and has its principal offices at 400 Bellevue
Parkway, Wilmington, Delaware 19809. PNC Asset Management Group, Inc.'s
principal business address is 1835 Market Street, Philadelphia, Pennsylvania
19102. PNC Bank serves as the Fund's sub-adviser. PNC Bank is a wholly owned,
indirect subsidiary of PNC Bank Corp., and its principal business address is
Broad and Chestnut Streets, Philadelphia, Pennsylvania 19102. PNC Bank Corp. is
a multi-bank holding company. PIMC and PNC Bank also serve as adviser and
sub-adviser, respectively, to the Company's T-Fund, FedCash, T-Cash, Federal
Trust Fund, Treasury Trust Fund and Short Government Fund portfolios.

PNC Bank Corp., headquartered in Pittsburgh, Pennsylvania, is the eleventh
largest bank holding company in the United States. Categorized as a super
regional bank holding company, PNC Bank Corp. operates over 500 branch offices
in six U.S. states.

PNC Bank's Investment Management and Trust Division, headquartered in
Philadelphia, Pennsylvania, traces its money management services to individuals
and institutions to the year 1847, and is the second largest bank manager of
investments for individuals in the U.S. with $28 billion in discretionary trust
assets under management.

9
<PAGE> 10

PNC Financial Services Group is PNC Bank Corp.'s mutual fund complex,
headquartered in Wilmington, Delaware. This group includes PIMC, PFPC, and PNC
Bank. In 1973, Provident National Bank (predecessor to PNC Bank) commenced
advising the first institutional money market mutual fund -- a U.S.
dollar-denominated constant net asset value fund -- offered in the United
States.

The PNC Financial Services Group is one of the largest U.S. bank managers
of mutual funds with assets currently under management in excess of $30 billion.
This group, through PFPC and PFPC International Ltd, is also a leading mutual
fund service provider having contractual relationships with approximately 400
mutual funds with 3.5 million shareholders and in excess of $106 billion in
assets. This group, through its PNC Institutional Investment Service, provides
investment research to some 250 financial institutions located in the United
States and abroad. PNC Bank provides custodial services for approximately $217
billion in assets, including $106 billion in mutual fund assets.

As adviser, PIMC manages the Fund's portfolio and is responsible for all
purchases and sales of the Fund's portfolio securities. PIMC also maintains the
Fund's financial accounts and records and computes the Fund's net asset value
and net income. For the advisory services provided and expenses assumed by it,
PIMC is entitled to receive a fee, computed daily and payable monthly, based on
the combined average net assets of the Fund, T-Fund, FedCash, T-Cash, Federal
Trust Fund and Treasury Trust Fund. The advisory fee is allocated among these
Funds in proportion to their relative net assets. In addition, PIMC and the
administrators have agreed to reduce the advisory and administration fees
otherwise payable to them and to reimburse the Fund for its operating expenses
to the extent necessary to ensure that its operating expense ratio (excluding
fees paid to Service Organizations pursuant to Servicing Agreements) does not
exceed .18% of the Fund's average net assets. After January 18, 1996, PIMC and
the administrators may terminate this agreement to reduce fees and limit
expenses on 120-days' written notice to the Fund. Any fees waived or expenses
reimbursed by PIMC and the administrators with respect to a particular fiscal
year are not recoverable. For the fiscal year ended October 31, 1994, the Fund
paid investment advisory fees aggregating .07% of its average net assets. Absent
fee waivers, advisory fees would have been .13% of the Fund's average daily net
assets.

As sub-adviser, PNC Bank provides research, credit analysis and
recommendations with respect to the Fund's investments, and supplies PIMC with
certain computer facilities, personnel and other services. For its sub-advisory
and other services, PNC Bank is entitled to receive from PIMC an amount equal to
75% of the advisory fee paid by the Fund to PIMC (subject to adjustment in
certain circumstances). The sub-advisory fees paid by PIMC to PNC Bank have no
effect on the advisory fees payable by the Fund to PIMC. PNC Bank also serves as
the Fund's custodian. The services provided by PNC Bank and PIMC and the fees
payable by the Fund for these services are described in the Statement of
Additional Information under "Management of the Funds."

ADMINISTRATORS

10
<PAGE> 11

Statement of Additional Information under "Management of the Funds," include
providing and supervising the operation of an automated data processing system
to process purchase and redemption orders; assisting in maintaining the Fund's
Wilmington, Delaware office; performing administrative services in connection
with the Fund's computer access program maintained to facilitate shareholder
access to the Fund; accumulating information for and coordinating the
preparation of reports to the Fund's shareholders and the SEC; and maintaining
the registration or qualification of the Fund's shares for sale under state
securities laws.

For their administrative services, the administrators are entitled jointly
to receive a fee computed daily and payable monthly, determined in the same
manner as PIMC's advisory fee described above. (For information regarding the
administrators' obligations to waive administrative fees otherwise payable to
them and to reimburse the Fund for operating expenses, see "Investment Adviser
and Sub-Adviser" above.) The Fund also reimburses each administrator for its
reasonable out-of-pocket expenses incurred in connection with the Funds'
computer access program. For the fiscal year ended October 31, 1994, the Fund
paid PFPC and PDI administration fees aggregating .07% of its average net
assets. Absent fee waivers, administration fees would have been .13% of the
Fund's average net assets.

PFPC also serves as transfer agent, registrar and dividend disbursing
agent. The transfer agent's address is P.O. Box 8950, Wilmington, Delaware
19885-9628. The services provided by PFPC and PDI and the fees payable by the
Fund for these services are described in the Statement of Additional Information
under "Management of the Funds."

DISTRIBUTOR

PDI serves as distributor of the Fund's shares. Its principal offices are
located at 259 Radnor-Chester Road, Suite 120, Radnor, Pennsylvania 19087. Fund
shares are sold on a continuous basis by the distributor as agent. The
distributor pays the cost of printing and distributing prospectuses to persons
who are not shareholders of the Fund (excluding preparation and printing
expenses necessary for continued registration of the Fund's shares) and of
printing and distributing all sales literature. No compensation is payable by
the Fund to the distributor for its distribution services.

SERVICE ORGANIZATIONS

Institutional investors, such as banks, savings and loan associations and
other financial institutions, including affiliates of PNC Bank Corp. ("Service
Organizations"), may purchase Dollar shares. FedFund Dollar shares are identical
in all respects to the Company's FedFund shares except that they bear the
service fees described below and enjoy certain exclusive voting rights on
matters relating to these fees. The Fund will enter into an agreement with each
Service Organization which purchases Dollar shares requiring it to provide
support services to its customers who are the beneficial owners of Dollar shares
in consideration of the Fund's payment of .25% (on an annualized basis) of the
average daily net assets of the Dollar shares held by the Service Organization
for the benefit of customers. Such services, which are described more fully in
the Statement of Additional Information under "Management of the Funds--Service
Organizations," include aggregating and processing purchase and redemption
requests from customers and placing net purchase and redemption orders with
PFPC; processing dividend payments from the Fund on behalf of customers;
providing information periodically to customers showing their positions in
Dollar shares; and providing sub-accounting or the information

11
<PAGE> 12

necessary for sub-accounting with respect to Dollar shares beneficially owned by
customers. Under the terms of the agreements, Service Organizations are required
to provide to their customers a schedule of any fees that they may charge to the
customers relating to the investment of the customers' assets in Dollar shares.
FedFund shares are sold to institutions that have not entered into servicing
agreements with the Fund in connection with their investments.

EXPENSES

Except as noted above and in the Statement of Additional Information under
"Management of the Funds--Custodian and Transfer Agent," the Fund's service
contractors bear all expenses in connection with the performance of their
services. Similarly, the Fund bears the expenses incurred in its operations. For
the fiscal year ended October 31, 1994, the Fund's total expenses with respect
to FedFund shares and FedFund Dollar shares were .18% and .43% (net of fee
waivers of .12% and .12%, respectively) of the average net assets of the FedFund
shares and the FedFund Dollar shares, respectively. With regard to fees paid
exclusively by Dollar shares, see "Service Organizations" above.

BANKING LAWS

Banking laws and regulations presently prohibit a bank holding company
registered under the Federal Bank Holding Company Act of 1956 or any bank or
non-bank affiliate thereof from sponsoring, organizing or controlling a
registered, open-end investment company engaged continuously in the issuance of
its shares, and prohibit banks generally from issuing, underwriting, selling or
distributing securities such as Fund shares. Such banking laws and regulations
do not prohibit such a holding company or affiliate or banks generally from
acting as investment adviser, transfer agent or custodian to such an investment
company, or from purchasing shares of such a company for or upon the order of
customers. PNC Bank, PIMC and PFPC, as well as some Service Organizations, are
subject to such banking laws and regulations, but believe they may perform the
services for the Fund contemplated by their respective agreements, this
Prospectus and Statement of Additional Information without violating applicable
banking laws or regulations.

Should future legislative, judicial or administrative action prohibit or
restrict the activities of bank Service Organizations in connection with the
provision of support services to their customers, the Fund might be required to
alter or discontinue its arrangements with Service Organizations and change its
method of operations with respect to Dollar shares. It is not anticipated,
however, that any change in the Fund's method of operations would affect its net
asset value per share or result in a financial loss to any customer.

DIVIDENDS

12
<PAGE> 13

Dividends are determined in the same manner for each share of the Fund.
Dollar shares bear all the expense of fees paid to Service Organizations. As a
result, at any given time, the net yield on FedFund Dollar shares is
approximately .25% lower than the net yield on FedFund shares.

Institutional shareholders may elect to have their dividends reinvested in
additional full and fractional shares of the same class of shares with respect
to which such dividends are declared at the net asset value of such shares on
the payment date. Reinvested dividends receive the same tax treatment as
dividends paid in cash. Such election, or any revocation thereof, must be made
in writing to PFPC at P.O. Box 8950, Wilmington, Delaware 19885-9628, and will
become effective after its receipt by PFPC with respect to dividends paid.

PFPC, as transfer agent, will send each Fund shareholder or its authorized
representative an annual statement designating the amount, if any, of any
dividends and distributions made during each year and their federal tax
qualification.

TAXES

The Fund qualified in its last taxable year and intends to qualify in
future years as a "regulated investment company" under the Internal Revenue Code
of 1986, as amended (the "Code"). A regulated investment company is generally
exempt from federal income tax on amounts distributed to its shareholders.

Qualification as a regulated investment company under the Code for a
taxable year requires, among other things, that the Fund distribute to its
shareholders at least 90% of its investment company taxable income for such
year. In general, the Fund's investment company taxable income will be its
taxable income (including interest and short-term capital gains, if any),
subject to certain adjustments and excluding the excess of any net long-term
capital gain for the taxable year over the net short-term capital loss, if any,
for such year. The Fund intends to distribute substantially all of its
investment company taxable income each year. Such distributions will be taxable
as ordinary income to the Fund's shareholders that are not currently exempt from
federal income taxes, whether such income is received in cash or reinvested in
additional shares. (Federal income taxes for distributions to an IRA or a
qualified retirement plan are deferred under the Code.) It is anticipated that
none of the Fund's distributions will be eligible for the dividends received
deduction for corporations. The Fund does not expect to realize long-term
capital gains and therefore does not expect to distribute any "capital gain
dividends," as described in the Code.

Dividends declared in October, November or December of any year payable to
shareholders of record on a specified date in such months will be deemed to have
been received by the shareholders and paid by the Fund on December 31 of such
year, in the event such dividends are actually paid during January of the
following year.

The foregoing is only a brief summary of some of the important federal tax
considerations generally affecting the Fund and its shareholders. As indicated
above, IRAs receive special tax treatment. No attempt is made to present a
detailed explanation of the federal, state or local income tax treatment of the
Fund or its shareholders, and this discussion is not intended as a substitute
for careful tax planning. Accordingly, potential investors in the Fund should
consult their tax advisors with specific reference to their own tax situations.

13
<PAGE> 14

YIELDS

From time to time, in advertisements or in reports to shareholders,
"yields" and "effective yields" for FedFund shares and FedFund Dollar shares may
be quoted. Yield quotations are computed separately for FedFund shares and
FedFund Dollar shares. The "yield" quoted in advertisements for a particular
class or sub-class of Fund shares refers to the income generated by an
investment in such shares over a specified period (such as a seven-day period)
identified in the advertisement. This income is then "annualized." That is, the
amount of income generated by the investment during that period is assumed to be
generated for each such period over a 52-week or one-year period and is shown as
a percentage of the investment. The "effective-yield" is calculated similarly
but, when annualized, the income earned by an investment in a particular class
or sub-class is assumed to be reinvested. The "effective yield" will be slightly
higher than the "yield" because of the compounding effect of this assumed
reinvestment.

The Fund's yields may be compared to those of other mutual funds with
similar objectives, to stock or other relevant indices, or to rankings prepared
by independent services or other financial or industry publications that monitor
the performance of mutual funds. For example, such data are reported in national
financial publications such as IBC/Donoghue's Money Fund Report(R), The Wall
Street Journal, and The New York Times, reports prepared by Lipper Analytical
Services, Inc., and publications of a local or regional nature.

The Fund's yield figures for FedFund shares and FedFund Dollar shares
represent the Fund's past performance, will fluctuate, and should not be
considered as representative of future results. The yield of any investment is
generally a function of portfolio quality and maturity, type of investment and
operating expenses. Any fees charged by Service Organizations or other
institutional investors directly to their customers in connection with
investments in Fund shares are not reflected in the Fund's yield calculations;
and, such fees, if charged, would reduce the actual return received by customers
on their investments. The methods used to compute the Fund's yields are
described in more detail in the Statement of Additional Information. Investors
may call 800-821-6006 (FedFund shares code: 30; FedFund Dollar shares code: 31)
to obtain current-yield information.

DESCRIPTION OF SHARES AND MISCELLANEOUS

The Company is a Pennsylvania business trust established on May 14, 1975.
Effective March 2, 1987, the Company's name was changed from Trust for
Short-Term Federal Securities to Trust for Federal Securities. The Company
commenced operations of the Fund in October, 1975.

The Company's Declaration of Trust authorizes the Board of Trustees to
issue an unlimited number of full and fractional shares of beneficial interest
in the Company and to classify or reclassify any unissued shares into one or
more additional classes of shares. Pursuant to such authority, the Board of
Trustees has authorized the issuance of fourteen classes of shares designated as
FedFund, FedFund Dollar, T-Fund, T-Fund Dollar, FedCash, FedCash Dollar, T-Cash,
T-Cash Dollar, Federal Trust, Federal Trust Dollar, Treasury Trust, Treasury
Trust Dollar, Short Government and Short Government Dollar. The Declaration of
Trust further authorizes the trustees to classify or reclassify any class of
shares into one or more sub-classes.

14
<PAGE> 15

THIS PROSPECTUS AND THE STATEMENT OF ADDITIONAL INFORMATION INCORPORATED
HEREIN RELATE PRIMARILY TO THE FUND AND DESCRIBE ONLY THE INVESTMENT OBJECTIVE
AND POLICIES, OPERATIONS, CONTRACTS AND OTHER MATTERS RELATING TO THE FUND.
INVESTORS WISHING TO OBTAIN SIMILAR INFORMATION REGARDING THE COMPANY'S T-FUND,
FEDCASH, T-CASH, FEDERAL TRUST FUND, TREASURY TRUST FUND, AND SHORT GOVERNMENT
FUND PORTFOLIOS MAY OBTAIN SEPARATE PROSPECTUSES DESCRIBING THOSE PORTFOLIOS BY
CALLING THE DISTRIBUTOR AT 800-998-7633.

The Company does not presently intend to hold annual meetings of
shareholders except as required by the 1940 Act or other applicable law. The
Company will call a meeting of shareholders for the purpose of voting upon the
question of removal of a member of the Board of Trustees upon written request of
shareholders owning at least 10% of the outstanding shares of the Company
entitled to vote.

Each FedFund share and FedFund Dollar share represents an equal
proportionate interest in the assets belonging to the Fund. Each share is
without par value and has no preemptive or conversion rights. When issued for
payment as described in this Prospectus, shares will be fully paid and
non-assessable.

Holders of the Company's FedFund shares and FedFund Dollar shares will vote
in the aggregate and not by class or sub-class on all matters, except where
otherwise required by law and except that only Dollar shares will be entitled to
vote on matters submitted to a vote of shareholders pertaining to the Fund's
arrangements with Service Organizations. Further, shareholders of all of the
Company's portfolios will vote in the aggregate and not by portfolio except as
otherwise required by law or when the Board of Trustees determines that the
matter to be voted upon affects only the interests of the shareholders of a
particular portfolio. (See the Statement of Additional Information under
"Additional Description Concerning Fund Shares" for examples where the 1940 Act
requires voting by portfolio.) Shareholders of the Company are entitled to one
vote for each full share held (irrespective of class, sub-class, or portfolio)
and fractional votes for fractional shares held. Voting rights are not
cumulative and, accordingly, the holders of more than 50% of the aggregate
shares of the Company may elect all of the trustees.

For information concerning the redemption of Fund shares and possible
restrictions on their transferability, see "Purchase and Redemption of Shares."

As stated above, the Company is organized as a trust under the laws of the
Commonwealth of Pennsylvania. Shareholders of such a trust may, under certain
circumstances, be held personally liable (as if they were partners) for the
obligations of the trust. The Company's Declaration of Trust provides for
indemnification out of the trust property of any shareholder of the Fund held
personally liable solely by reason of being or having been a shareholder and not
because of any acts or omissions or some other reason.

15
<PAGE> 16

- ---------------------------------------------------------

NO PERSON HAS BEEN AUTHORIZED TO GIVE
ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS NOT CONTAINED IN THIS
PROSPECTUS, OR IN THE FUND'S STATEMENT
OF ADDITIONAL INFORMATION INCORPORATED
HEREIN BY REFERENCE, IN CONNECTION WITH
THE OFFERING MADE BY THIS PROSPECTUS
AND, IF GIVEN OR MADE, SUCH INFORMATION
OR REPRESENTATIONS MUST NOT BE RELIED
UPON AS HAVING BEEN AUTHORIZED BY THE
COMPANY OR ITS DISTRIBUTOR. THIS
PROSPECTUS DOES NOT CONSTITUTE AN
OFFERING BY THE COMPANY OR BY THE
DISTRIBUTOR IN ANY JURISDICTION IN WHICH
SUCH OFFERING MAY NOT LAWFULLY BE MADE.

----------------------

TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
------
<S> <C>
Background and Expense
Information.................. 2
Financial Highlights........... 3
Investment Objective and
Policies..................... 5
Purchase and Redemption of
Shares....................... 7
Management of the Fund......... 9
Dividends...................... 12
Taxes.......................... 13
Yields......................... 14
Description of Shares and
Miscellaneous................ 14
</TABLE>

PIF-P-003

FEDFUND

AN INVESTMENT PORTFOLIO
OFFERED BY
TRUST FOR FEDERAL SECURITIES

[LOGO]

Prospectus

February 28, 1995

- ---------------------------------------------------------
<PAGE> 17

T-Fund
An Investment Portfolio Offered By
Trust for Federal Securities

<TABLE>
<S> <C>
Bellevue Park Corporate Center For purchase and redemption orders only call:
400 Bellevue Parkway 800-441-7450 (in Delaware: 302-791-5350).
Suite 100 For yield information call: 800-821-6006
Wilmington, DE 19809 (T-Fund shares code: 60; T-Fund Dollar shares
code: 61).
For other information call: 800-821-7432.
</TABLE>

The Fund's investment objective is to seek current income with liquidity
and security of principal. The Fund invests in a portfolio consisting of U.S.
Treasury bills, notes and direct obligations of the U.S. Treasury and repurchase
agreements relating to direct Treasury obligations.

Fund shares may not be purchased by individuals directly, but institutional
investors may purchase shares for accounts maintained by individuals. In
addition to T-Fund shares, investors may purchase T-Fund "Dollar" shares which
accrue daily dividends in the same manner as T-Fund shares but bear all fees
payable by the Fund to institutional investors for certain services they provide
to the beneficial owners of such shares. (See "Management of the Fund--Service
Organizations.")

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE
SECURITIES COMMISSION PASSED UPON THE ACCURACY
OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.

------------------------
February 28, 1995
<PAGE> 18

BACKGROUND AND EXPENSE INFORMATION

Two classes of shares are offered by this Prospectus: T-Fund shares and
T-Fund Dollar shares. Shares of each class represent equal, pro rata interests
in the Fund and accrue daily dividends in the same manner except that the Dollar
shares bear fees payable by the Fund (at the rate of .25% per annum) to
institutional investors for services they provide to the beneficial owners of
such shares. (See "Management of the Fund -- Service Organizations.")

EXPENSE SUMMARY

<TABLE>
<CAPTION>
T-FUND
T-FUND DOLLAR
SHARES SHARES
------------ ------------
<S> <C> <C> <C> <C>
ESTIMATED ANNUAL FUND OPERATING EXPENSES
- ----------------------------------------------------------------
(as a percentage of average net assets)
Management Fees (net of waivers)........................... .07 % .07 %
Other Expenses............................................. .11 % .36 %
Administration Fees (net of waivers).................. .07 % .07 %
Shareholder Servicing Fees............................ 0 % .25 %
Miscellaneous......................................... .04 % .04 %
---- ----
Total Fund Operating Expenses (net of waivers)............. .18 % .43 %
=== ===
</TABLE>

- ------------

<TABLE>
<CAPTION>
EXAMPLE 1 YEAR 3 YEARS 5 YEARS 10 YEARS
- ---------------------------------------------------- ------ ------- ------- --------
<S> <C> <C> <C> <C>
You would pay the following expenses on a $1,000
investment, assuming (1) a 5% annual return and
(2) redemption at the end of each time period with
respect to the following shares:
T-Fund shares: $2 $ 6 $10 $ 23
T-Fund Dollar shares: $4 $14 $24 $ 54
</TABLE>

THE FOREGOING SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE
EXPENSES OR RATE OF RETURN. ACTUAL EXPENSES AND RATE OF RETURN MAY BE GREATER OR
LESSER THAN THOSE SHOWN.

The purpose of the foregoing table is to assist an investor in
understanding the various costs and expenses that an investor in the Fund will
bear directly or indirectly. In addition, institutional investors may charge
fees for providing shareholder administrative services in connection with their
customers' investment in T-Fund Dollar shares. (For more complete descriptions
of the various costs and expenses, see "Management of the Fund" in this
Prospectus and the Statement of Additional Information and the financial
statements and related notes contained in the Statement of Additional
Information.) The investment adviser and administrators have waived advisory and
administration fees or have reimbursed the Fund for some or all of its operating
expenses pursuant to an agreement that extends to January 18, 1996. The
foregoing table gives effect to this agreement. It is anticipated that they may
continue to do so on a voluntary basis thereafter. Absent fee waivers for the
fiscal year ended October 31, 1994, the estimated "Total Fund Operating
Expenses" for T-Fund Shares and T-Fund Dollar Shares would have been .29% and
.54%, respectively, of the average net assets of the T-Fund portfolio. The
foregoing table has not been audited by the Fund's independent accountants.

2
<PAGE> 19

FINANCIAL HIGHLIGHTS

The following financial highlights for T-Fund Shares have been derived from
the financial statements of the Fund for the fiscal year ended October 31, 1994,
and for each of the nine preceding fiscal years, and for T-Fund Dollar Shares
for the fiscal year ended October 31, 1994 and for each of the eight preceding
fiscal years and the fiscal period ended October 31, 1986 (commencement of Fund
operations). The financial highlights for the fiscal years set forth below have
been audited by Coopers & Lybrand L.L.P. independent accountants whose report on
the financial statements and financial highlights (for the most recent five
years) of the Fund is included in the Statement of Additional Information. The
tables should be read in conjunction with the financial statements and related
notes included in the Statement of Additional Information. Further information
about the performance of the Fund is available in the annual report to
shareholders, which may be obtained without charge by calling 800-821-7432.

TRUST FOR FEDERAL SECURITIES
Financial Highlights
(For a Share Outstanding Throughout Each Period)

T-FUND SHARES
<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31,
----------------------------------------------------------------------------------------
1994 1993 1992 1991 1990 1989 1988
---------- ---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period.... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- ---------- ---------- ---------- ---------- ---------- ----------
Income From Investment Operations:
Net Investment Income................. .0368 .0303 .0392 .0626 .0799 .0880 .0692
---------- ---------- ---------- ---------- ---------- ---------- ----------
Total From Investment Operations...... .0368 .0303 .0392 .0626 .0799 .0880 .0692
---------- ---------- ---------- ---------- ---------- ---------- ----------
Less Distributions:
Dividends to Shareholders from:
Net Investment Income............... (.0368) (.0303) (.0392) (.0626) (.0799) (.0880) (.0692)
---------- ---------- ---------- ---------- ---------- ---------- ----------
Total Distributions................. (.0368) (.0303) (.0392) (.0626) (.0799) (.0880) (.0692)
---------- ---------- ---------- ---------- ---------- ---------- ----------
Net Asset Value, End of Period.......... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
========= ========= ========= ========= ========= ========= =========
Total Return............................ 3.75% 3.07% 3.99% 6.44% 8.29% 9.17% 7.14%
Ratios/Supplemental Data
Net Assets, End of Period (in 000s)... $1,035,172 $1,361,624 $1,327,743 $1,592,750 $1,497,476 $1,422,788 $1,793,479
Ratio of Expenses to Average Net
Assets.............................. .18%(1) .20%(1) .28% .30% .30%(1) .30%(1) .30%(1)
Ratio of Net Investment Income to
Average Net Assets.................. 3.65% 3.03% 3.93% 6.26% 7.99% 8.80% 6.91%

1987 1986 1985
---------- ---------- ----------
<S> <C> <C> <C>
Net Asset Value, Beginning of Period....$ 1.00 $ 1.00 $ 1.00
---------- ---------- ----------
Income From Investment Operations:
Net Investment Income................. .0606 .0676 .0807
---------- ---------- ----------
Total From Investment Operations...... .0606 .0676 .0807
---------- ---------- ----------
Less Distributions:
Dividends to Shareholders from:
Net Investment Income............... (.0606) (.0676) (.0807)
---------- ---------- ----------
Total Distributions................. (.0606) (.0676) (.0807)
---------- ---------- ----------
Net Asset Value, End of Period..........$ 1.00 $ 1.00 $ 1.00
========= ========= =========
Total Return............................ 6.23% 6.97% 8.38%
Ratios/Supplemental Data
Net Assets, End of Period (in 000s)...$1,737,258 $1,680,120 $1,302,428
Ratio of Expenses to Average Net
Assets.............................. .30%(1) .33% .35%
Ratio of Net Investment Income to
Average Net Assets.................. 6.05% 6.72% 8.06%
</TABLE>

- ------------
(1) Without the waiver of advisory and administration fees, the ratio of
expenses to average daily net assets would have been .29%, .28%, .34%, .35%,
.33%, and .33%, respectively, for each of the years ended October 31, 1994,
1993, 1990, 1989, 1988 and 1987, respectively, for T-Fund shares.

3
<PAGE> 20

TRUST FOR FEDERAL SECURITIES

Financial Highlights
(For a Share Outstanding Throughout Each Period)

T-FUND DOLLAR SHARES
<TABLE>
<CAPTION>
T-FUND DOLLAR SHARES
YEAR ENDED OCTOBER 31,
--------------------------------------------------------------
1994 1993 1992 1991 1990 1989
------- ------- ------- ------- ------- -------
<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....................................... .0343 .0278 .0367 .0601 .0774 .0855
------- ------- ------- ------- ------- -------
Total From Investment Operations............................ .0343 .0278 .0367 .0601 .0774 .0855
------- ------- ------- ------- ------- -------
Less Distributions:
Dividends to Shareholders from:
Net Investment Income....................................... (.0343) (.0278) (.0367) (.0601) (.0774) (.0855)
------- ------- ------- ------- ------- -------
Total Distributions......................................... (.0343) (.0278) (.0367) (.0601) (.0774) (.0855)
------- ------- ------- ------- ------- -------
Net Asset Value, End of Period............................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======== ======== ======== ======== ======== ========
Total Return................................................ 3.50% 2.82% 3.74% 6.19% 8.04% 8.92%
Ratios/Supplemental Data
Net Assets, End of Period
(in 000s)................................................. $22,195 $13,328 $ 4,915 $40,372 $27,116 $42,439
Ratio of Expenses to Average Net Assets..................... .43%(1) .45% .53% .55% .55%(1) .55%(1)
Ratio of Net Investment Income to Average Net Assets........ 3.40% 2.78% 3.68% 6.01% 7.74% 8.55%

JANUARY 6, 1986
TO
1988 1987 OCTOBER 31, 1986
------- ------- -----------------
<S> <C<C> <C> <C>
Net Asset Value, Beginning of Period......................... $ 1.00 $ 1.00 $ 1.00
------- ------- -------
Income From Investment Operations:
Net Investment Income....................................... .0667 .0581 .0520
------- ------- -------
Total From Investment Operations............................ .0667 .0581 .0520
------- ------- -------
Less Distributions:
Dividends to Shareholders from:
Net Investment Income....................................... (.0667) (.0581) (.0520)
------- ------- -------
Total Distributions......................................... (.0667) (.0581) (.0520)
------- ------- -------
Net Asset Value, End of Period............................... $ 1.00 $ 1.00 $ 1.00
======== ======== ==================
Total Return................................................ 6.89% 5.98% 5.32%
Ratios/Supplemental Data
Net Assets, End of Period
(in 000s)................................................. $52,083 $30,686 $ 4,259
Ratio of Expenses to Average Net Assets..................... .55%(1) .55%(1) .58%(2)
Ratio of Net Investment Income to Average Net Assets........ 6.66% 5.80% 6.27%(2)
</TABLE>

- ---------------

1 Without the waiver of advisory and administration fees, the ratios of expenses
to average daily net assets would have been .54%, .53%, .59%, .60%, .58% and
.58%, respectively, for each of the years ended October 31, 1994, 1993, 1990,
1989, 1988 and 1987 for T-Fund Dollar shares.

2 Annualized.

4
<PAGE> 21

INVESTMENT OBJECTIVE AND POLICIES

The Fund's investment objective is to seek current income with liquidity
and security of principal. The Fund invests solely in direct obligations of the
U.S. Treasury, such as Treasury bills and notes and repurchase agreements
relating to direct Treasury obligations. Portfolio securities held by the Fund
have remaining maturities of 397 days (thirteen months) or less (with certain
exceptions), subject to the quality, diversification, and other requirements of
Rule 2a-7 under the Investment Company Act of 1940, as amended (the "1940 Act")
and other rules of the Securities and Exchange Commission (the "SEC").

Securities issued or guaranteed by the U.S. Government have historically
involved little risk of loss of principal if held to maturity. However, due to
fluctuations in interest rates, the market value of such securities may vary
during the period a shareholder owns shares of the Fund. Certain government
securities held by the Fund may have remaining maturities exceeding thirteen
months if such securities provide for adjustments in their interest rates not
less frequently than every thirteen months. To the extent consistent with its
investment objectives, the Fund may invest in Treasury receipts and other
"stripped" securities issued or guaranteed by the U.S. Government, where the
principal and interest components are traded independently under the Separate
Trading of Registered Interest and Principal of Securities program ("STRIPS").
Under the STRIPS program, the principal and interest components are individually
numbered and separately issued by the U.S. Treasury at the request of depository
financial institutions, which then trade the component parts independently.
Currently, the Fund only invests in "stripped" securities issued or guaranteed
by the U.S. Government which are registered under the STRIPS program.

5
<PAGE> 22

changes in value based upon changes in the general level of interest rates. The
Fund expects that commitments to purchase when-issued securities will not exceed
25% of the value of its total assets absent unusual market conditions. The Fund
does not intend to purchase when-issued securities for speculative purposes but
only in furtherance of its investment objective.

INVESTMENT LIMITATIONS

The Fund may not:

1. Purchase securities other than direct obligations of the U.S. Treasury
such as Treasury bills and notes, some of which may be subject to repurchase
agreements.

2. Borrow money except from banks for temporary purposes and then in an
amount not exceeding 10% of the value of the Fund's total assets, or mortgage,
pledge or hypothecate its assets except in connection with any such borrowing
and in amounts not in excess of the lesser of the dollar amounts borrowed or 10%
of the value of the Fund's total assets at the time of such borrowing.

3. Make loans except that the Fund may purchase or hold debt obligations in
accordance with its investment objective and policies, may enter into repurchase
agreements for securities and may lend portfolio securities against collateral
consisting of cash or securities which are consistent with the Fund's permitted
investments, which is equal at all times to at least 100% of the value of the
securities loaned. There is no investment restriction on the amount of
securities that may be loaned, except that payments received on such loans,
including amounts received during the loan on account of interest on the
securities loaned, may not (together with all non-qualifying income) exceed 10%
of the Fund's annual gross income (without offset for realized capital gains)
unless, in the opinion of counsel to the Company, such amounts are qualifying
income under federal income tax provisions applicable to regulated investment
companies.

6
<PAGE> 23

PURCHASE AND REDEMPTION OF SHARES

PURCHASE PROCEDURES

Fund shares are sold at the net asset value per share next determined after
receipt of a purchase order by PFPC, the Fund's transfer agent. Purchase orders
for shares are accepted by the Fund only on days on which both the New York
Stock Exchange and the Federal Reserve Bank of Philadelphia, are open for
business (a "Business Day") and must be transmitted to PFPC in Wilmington,
Delaware, by telephone (800-441-7450; in Delaware: 302-791-5350); or through the
Fund's computer access program. Orders received before 12:00 noon, Eastern time,
for which payment has been received by PNC Bank the Fund's custodian will be
executed at 12:00 noon. Orders received after 12:00 noon and before 2:30 P.M.,
Eastern time, (or orders received earlier in the same day for which payment has
not been received by 12:00 noon) will be executed at 4:00 P.M., Eastern time, if
payment has been received by PNC Bank by that time. Orders received at other
times, and orders for which payment has not been received by 4:00 P.M., Eastern
time, will not be accepted, and notice thereof will be given to the institution
placing the order. (Payment for orders which are not received or accepted will
be returned after prompt inquiry to the sending institution.) The Fund may in
its discretion reject any order for shares.

Conflict of interest restrictions may apply to an institution's receipt of
compensation paid by the Fund on fiduciary funds that are invested in Dollar
shares. (See also "Management of the Fund -- Service Organizations.")
Institutions, including banks regulated by the Comptroller of the Currency and
investment advisers and other money managers subject to the jurisdiction of the
SEC, the Department of Labor or state securities commissions, should consult
their legal advisors before investing fiduciary funds in Dollar shares. (See
also "Management of the Fund -- Banking Laws.")

REDEMPTION PROCEDURES

Redemption orders must be transmitted to PFPC in Wilmington, Delaware, in
the manner described under "Purchase Procedures." Shares are redeemed at the net
asset value per share next determined after PFPC's receipt of the redemption
order. While the Fund intends to use its best efforts to maintain its net asset
value per share at $1.00, the proceeds paid to a shareholder upon redemption may
be more or less than the amount invested depending upon a share's net asset
value at the time of redemption.

Payment for redeemed shares for which a redemption order is received by
PFPC before 12:00 noon, Eastern time, on a Business Day is normally made in
federal funds wired to the redeeming shareholder on the same business day. A
shareholder of record located in the Pacific Time Zone or Mountain Time Zone may
receive redemption proceeds wired the same day in federal funds to a destination
within such time zone if its redemption order is received before 2:30 P.M.,
Eastern time, or 1:30 P.M., Eastern time, respectively. Payment for other
redemption orders which are received between 12:00 noon and 4:00 P.M., Eastern
time, or on a day when PNC

7
<PAGE> 24

Bank is closed, is normally wired in federal funds on the next day following
redemption that PNC Bank is open for business.

OTHER MATTERS

MANAGEMENT OF THE FUND

BOARD OF TRUSTEES

The business and affairs of the Fund are managed under the direction of the
Company's Board of Trustees. The trustees of the Company are as follows:

Philip E. Coldwell is an economic consultant and a former Member of
the Board of Governors of the Federal Reserve System.

Robert R. Fortune is a financial consultant and former Chairman,
President and Chief Executive Officer of Associated Electric & Gas
Insurance Services Limited.

8
<PAGE> 25

Rodney D. Johnson is President of Fairmount Capital Advisors, Inc.

G. Willing Pepper, Chairman of the Board and President of the Company,
is a retired President of Scott Paper Company.

Anthony M. Santomero is the Richard K. Mellon Professor of Finance at
The Wharton School, University of Pennsylvania.

David R. Wilmerding, Jr., Vice Chairman of the Board of the Company,
is President and Chief Executive Officer of Gates, Wilmerding, Carper &
Rawlings, Inc.

Mr. Pepper is considered by the Company to be an "interested person" of the
Company as defined in the 1940 Act.

The other officers of the Company are as follows:

Edward J. Roach is Vice President and Treasurer of the Company.

W. Bruce McConnel, III, Secretary of the Company, is a partner of the
law firm of Drinker Biddle & Reath, Philadelphia, Pennsylvania.

INVESTMENT ADVISER AND SUB-ADVISER

PIMC, a wholly owned subsidiary of PNC Asset Management Group, Inc., which
is in turn a wholly owned subsidiary of PNC Bank, serves as the Fund's
investment adviser. PIMC was organized in 1977 by PNC Bank to perform advisory
services for investment companies and has its principal offices at 400 Bellevue
Parkway, Wilmington, Delaware 19809. PNC Asset Management Group, Inc.'s
principal business address is 1835 Market Street, Philadelphia, Pennsylvania
19102. PNC Bank serves as the Fund's sub-adviser. PNC Bank is a wholly owned,
indirect subsidiary of PNC Bank Corp. and its principal business address is
Broad and Chestnut Streets, Philadelphia, Pennsylvania 19102. PNC Bank Corp. is
a multi-bank holding company. PIMC and PNC Bank also serve as adviser and
sub-adviser, respectively, to the Company's FedFund, FedCash, T-Cash, Federal
Trust Fund, Treasury Trust Fund and Short Government Fund portfolios.

PNC Financial Services Group is PNC Bank Corp.'s mutual fund complex,
headquartered in Wilmington, Delaware. This group includes PIMC, PFPC and PNC
Bank. In 1973, Provident National Bank (predecessor to PNC Bank) commenced
advising the first institutional money market mutual fund -- a U.S.
dollar-denominated constant net asset value fund -- offered in the United
States.

9
<PAGE> 26

relationships with approximately 400 mutual funds with 3.5 million shareholders
and in excess of $106 billion in assets. This group, through its PNC
Institutional Investment Service, provides investment research to some 250
financial institutions located in the United States and abroad. PNC Bank
provides custodial services for approximately $217 billion in assets, including
$106 billion in mutual fund assets.

As adviser, PIMC manages the Fund's portfolio and is responsible for all
purchases and sales of the Fund's portfolio securities. PIMC also maintains the
Fund's financial accounts and records and computes the Fund's net asset value
and net income. For the advisory services provided and expenses assumed by it,
PIMC is entitled to receive a fee, computed daily and payable monthly, based on
the combined average net assets of the Fund, FedFund, FedCash, T-Cash, Federal
Trust Fund and Treasury Trust Fund. The advisory fee is allocated among these
funds in proportion to their relative net assets. In addition, PIMC and the
administrators have agreed to reduce the advisory and administration fees
otherwise payable to them and to reimburse the Fund for its operating expenses
to the extent necessary to ensure that its operating expense ratio (excluding
fees paid to Service Organizations pursuant to Servicing Agreements) does not
exceed .18% of the Fund's average net assets. After January 18, 1996, PIMC and
the administrators may terminate this agreement to reduce fees and limit
expenses on 120-days' written notice to the Fund. Any fees waived by PIMC with
respect to a particular fiscal year are not recoverable. For the fiscal year
ended October 31, 1994, the Fund paid investment advisory fees aggregating .07%
of its average net assets. Absent fee waivers, the advisory fees would have been
.13% of the Fund's average daily net assets.

ADMINISTRATOR

PFPC, whose principal business address is 400 Bellevue Parkway, Wilmington,
Delaware 19809, and PDI whose principal business address is 259 Radnor-Chester
Road, Suite 120, Radnor, Pennsylvania 19087, serve as co-administrators. PFPC is
an indirect wholly-owned subsidiary of PNC Bank Corp. A majority of the
outstanding stock of PDI is owned by its officers. The administrative services
provided by the administrators, which are described more fully in the Statement
of Additional Information under "Management of the Funds," include providing and
supervising the operation of an automated data processing system to process
purchase and redemption orders; assisting in maintaining the Fund's Wilmington,
Delaware office; performing administrative services in connection with the
Fund's computer access program maintained to facilitate shareholder access to
the Fund; accumulating information for and coordinating the preparation of
reports to the Fund's shareholders and the SEC; and maintaining the registration
or qualification of the Fund's shares for sale under state securities laws.

10
<PAGE> 27

DISTRIBUTOR

PDI serves as distributor of the Fund's shares. Its principal offices are
located at 259 Radnor-Chester Road, Suite 120, Radnor, Pennsylvania 19087. Fund
shares are sold on a continuous basis by the distributor as agent. The
distributor pays the cost of printing and distributing prospectuses to persons
who are not shareholders of the Fund (excluding preparation and printing
expenses necessary for the continued registration of the Fund's shares) and of
printing and distributing all sales literature. No compensation is payable by
the Fund to the distributor for its distribution services.

SERVICE ORGANIZATIONS

Institutional investors, such as banks, savings and loan associations and
other financial institutions, including affiliates of PNC Bank Corp. ("Service
Organizations"), may purchase Dollar shares. T-Fund Dollar shares are identical
in all respects to the Company's T-Fund shares except that they bear the service
fees described below and enjoy certain exclusive voting rights on matters
relating to these fees. The Fund will enter into an agreement with each Service
Organization which purchases Dollar shares requiring it to provide support
services to its customers who are the beneficial owners of Dollar shares in
consideration of the Fund's payment of .25% (on an annualized basis) of the
average daily net assets of the Dollar shares held by the Service Organization
for the benefit of customers. Such services, which are described more fully in
the Statement of Additional Information under "Management of the Funds--Service
Organizations," include aggregating and processing purchase and redemption
requests from customers and placing net purchase and redemption orders with
PFPC; processing dividend payments from the Fund on behalf of customers;
providing information periodically to customers showing their positions in
Dollar shares; and providing sub-accounting or the information necessary for
sub-accounting with respect to Dollar shares beneficially owned by customers.
Under the terms of the agreements, Service Organizations are required to provide
to their customers a schedule of any fees that they may charge to the customers
relating to the investment of the customers' assets in Dollar shares. T-Fund
shares are sold to institutions that have not entered into servicing agreements
with the Fund in connection with their investments.

11
<PAGE> 28

EXPENSES

Except as noted above and in the Statement of Additional Information under
"Management of the Funds--Custodian and Transfer Agent," the Fund's service
contractors bear all expenses in connection with the performance of their
services. Similarly, the Fund bears the expenses incurred in its operations. For
the fiscal year ended October 31, 1994, the Fund's total expenses with respect
to T-Fund shares and T-Fund Dollar shares were .18% and .43% net of waivers of
.12% and .12%, respectively of the average net assets of the T-Fund shares and
the T-Fund Dollar shares respectively. With regard to fees paid exclusively by
Dollar shares, see "Service Organizations" above.

BANKING LAWS

DIVIDENDS

Dividends are determined in the same manner for each share of the Fund.
Dollar shares bear all the expense of fees paid to Service Organizations. As a
result, at any given time, the net yield on T-Fund Dollar shares is
approximately .25% lower than the net yield on T-Fund shares.

12
<PAGE> 29

TAXES

YIELDS

From time to time, in advertisements or reports to Shareholders, "yields"
and "effective yields" for T-Fund shares and T-Fund Dollar shares may be quoted.
Yield quotations are

13
<PAGE> 30

computed separately for T-Fund and T-Fund Dollar Shares. The "yield" quoted in
advertisements for a particular class or sub-class of Fund shares refers to the
income generated by an investment in such shares over a specified period (such
as a seven-day period) identified in the advertisement. This income is then
"annualized." That is, the amount of income generated by the investment during
that period is assumed to be generated for each such period over a 52-week or
one year period and is shown as a percentage of the investment. The "effective
yield" is calculated similarly but, when annualized, the income earned by an
investment in a particular class or sub-class of Fund shares is assumed to be
reinvested. The "effective yield" will be slightly higher than the "yield"
because of the compounding effect of this assumed reinvestment.

The Fund's yield figures for T-Fund shares and T-Fund Dollar shares
represent the Fund's past performance, will fluctuate, and should not be
considered as representative of future results. The yield of any investment is
generally a function of portfolio quality and maturity, type of investment and
operating expenses. Any fees charged by Service Organizations or other
institutional investors directly to their customers in connection with
investments in Fund shares are not reflected in the Fund's yield calculations;
and, such fees, if charged, would reduce the actual return received by customers
on their investments. The methods used to compute the Fund's yields are
described in more detail in the Statement of Additional Information. Investors
may call 800-821-6006 (T-Fund shares code 60: T-Fund Dollar shares code: 61) to
obtain current-yield information.

DESCRIPTION OF SHARES AND MISCELLANEOUS

14
<PAGE> 31

TRUST FUND, TREASURY TRUST FUND, AND SHORT GOVERNMENT FUND PORTFOLIOS MAY OBTAIN
SEPARATE PROSPECTUSES DESCRIBING THOSE PORTFOLIOS BY CALLING THE DISTRIBUTOR AT
800-998-7633.

Each T-Fund share and T-Fund Dollar share represents an equal proportionate
interest in the assets belonging to the Fund. Each share is without par value
and has no preemptive or conversion rights. When issued for payment as described
in this Prospectus, shares will be fully paid and non-assessable.

Holders of the Company's T-Fund shares and T-Fund Dollar shares will vote
in the aggregate and not by class or sub-class on all matters, except where
otherwise required by law and except that only Dollar shares will be entitled to
vote on matters submitted to a vote of shareholders pertaining to the Fund's
arrangements with Service Organizations. Further, shareholders of all of the
Company's portfolios will vote in the aggregate and not by portfolio except as
otherwise required by law or when the Board of Trustees determines that the
matter to be voted upon affects only the interests of the shareholders of a
particular portfolio. (See the Statement of Additional Information under
"Additional Description Concerning Fund Shares" for examples where the 1940 Act
requires voting by portfolio.) Shareholders of the Company are entitled to one
vote for each full share held (irrespective of class, sub-class, or portfolio)
and fractional votes for fractional shares held. Voting rights are not
cumulative and, accordingly, the holders of more than 50% of the aggregate
shares of the Company may elect all of the trustees.

For information concerning the redemption of Fund shares and possible
restrictions on their transferability, see "Purchase and Redemption of Shares."

15
<PAGE> 32
- ---------------------------------------------------

NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS NOT
CONTAINED IN THIS PROSPECTUS, OR IN THE FUND'S
STATEMENT OF ADDITIONAL INFORMATION
INCORPORATED HEREIN BY REFERENCE, IN
CONNECTION WITH THE OFFERING MADE BY THIS
PROSPECTUS AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATIONS MUST NOT BE
RELIED UPON AS HAVING BEEN AUTHORIZED BY THE
COMPANY OR ITS DISTRIBUTOR. THIS PROSPECTUS
DOES NOT CONSTITUTE AN OFFERING BY THE COMPANY
OR BY THE DISTRIBUTOR IN ANY JURISDICTION IN
WHICH SUCH OFFERING MAY NOT LAWFULLY
BE MADE.

-----------------
TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
------
<S> <C>
Background and Expense
Information.................. 2
Financial Highlights........... 3
Investment Objective and
Policies..................... 5
Purchase and Redemption of
Shares....................... 7
Management of the Fund......... 8
Dividends...................... 12
Taxes.......................... 13
Yields......................... 13
Description of Shares and
Miscellaneous................ 14
</TABLE>

PIF-P-006

T-FUND

AN INVESTMENT PORTFOLIO
OFFERED BY
TRUST FOR FEDERAL SECURITIES

[LOGO]

Prospectus

February 28, 1995

- ---------------------------------------------------
<PAGE> 33

FEDFUND AND T-FUND

Investment Portfolios Offered By
Trust for Federal Securities

Statement of Additional Information
February 28, 1995

TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S> <C>
Page
----

THE COMPANY . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . 2

INVESTMENT OBJECTIVES AND POLICIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

ADDITIONAL PURCHASE AND REDEMPTION INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

MANAGEMENT OF THE FUNDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

DIVIDENDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

ADDITIONAL YIELD INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

ADDITIONAL DESCRIPTION CONCERNING FUND SHARES . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

COUNSEL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

AUDITORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26

FINANCIAL STATEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . FS-1
</TABLE>

This Statement of Additional Information is meant
to be read in conjunction with the Prospectuses for FedFund and
T-Fund dated February 28, 1995 and is incorporated by reference in
its entirety into those Prospectuses. Because this Statement of
Additional Information is not itself a prospectus, no investment in
shares of FedFund or T-Fund should be made solely upon the
information contained herein. Copies of the Prospectuses for FedFund
and T-Fund may be obtained by calling 800-821-7432. Capitalized
terms used but not defined herein have the same meanings as in the
Prospectuses.

<PAGE> 34

THE COMPANY

Trust for Federal Securities (Trust for Short-Term
Federal Securities prior to March 2, 1987) is a no-load, diversified,
open-end investment company designed primarily as a vehicle by which
institutional investors can invest cash reserves in a choice of
portfolios consisting of government securities. Trust for Federal
Securities (the "Company") consists of seven separate investment
portfolios--FedFund, T-Fund, FedCash, T-Cash, Federal Trust Fund,
Treasury Trust Fund and Short Government Fund. This Statement of
Additional Information relates primarily to the Company's FedFund and
T-Fund portfolios (the "Funds").

The securities held by FedFund consist of
obligations issued or guaranteed by the U.S. Government, its agencies
or instrumentalities and repurchase agreements relating to such
obligations. Securities held by T-Fund are limited to U.S. Treasury
bills, notes and other direct obligations of the U.S. Treasury and
repurchase agreements relating to direct Treasury obligations.
Although both Funds have the same investment adviser and have
comparable investment objectives, their yields normally will differ
due to their differing cash flows and differences in the specific
portfolio securities held.

THIS STATEMENT OF ADDITIONAL INFORMATION AND THE
FUNDS' PROSPECTUSES RELATE PRIMARILY TO THE FUNDS AND DESCRIBE ONLY
THE INVESTMENT OBJECTIVE AND POLICIES, OPERATIONS, CONTRACTS, AND
OTHER MATTERS RELATING TO THE FUNDS. INVESTORS WISHING TO OBTAIN
SIMILAR INFORMATION REGARDING THE COMPANY'S FEDCASH, T-CASH, FEDERAL
TRUST FUND, TREASURY TRUST FUND OR SHORT GOVERNMENT FUND PORTFOLIOS
MAY OBTAIN SEPARATE PROSPECTUSES DESCRIBING THOSE PORTFOLIOS BY
CALLING THE DISTRIBUTOR AT 800-998-7633.

INVESTMENT OBJECTIVES AND POLICIES

As stated in the Funds' Prospectuses, the
investment objective of each Fund is to seek current income with
liquidity and security of principal. The following policies
supplement the description in the Prospectuses of the investment
objectives and policies of the Funds.

PORTFOLIO TRANSACTIONS

-2-
<PAGE> 35

sales of portfolio securities for the Funds. Purchases and
sales of portfolio securities are usually principal transactions
without brokerage commissions. In making portfolio investments, PIMC
seeks to obtain the best net price and the most favorable execution of
orders. To the extent that the execution and price offered by more
than one dealer are comparable, PIMC may, in its discretion, effect
transactions in portfolio securities with dealers who provide the
Company with research advice or other services. Although the Funds
will not seek profits through short-term trading, PIMC may, on behalf
of the Funds, dispose of any portfolio security prior to its maturity
if it believes such disposition is advisable.

Investment decisions for the Funds are made
independently from those for other investment company portfolios or
accounts advised or managed by PIMC. Such other portfolios may
invest in the same securities as the Funds. When purchases or sales
of the same security are made at substantially the same time on
behalf of such other portfolios, transactions are averaged as to
price, and available investments allocated as to amount, in a manner
which PIMC believes to be equitable to each portfolio, including
either Fund. In some instances, this investment procedure may
adversely affect the price paid or received by a Fund or the size of
the position obtained for a Fund. To the extent permitted by law,
PIMC may aggregate the securities to be sold or purchased for a Fund
with those to be sold or purchased for such other investment company
portfolios in order to obtain best execution.

Portfolio securities will not be purchased from or
sold to and the Funds will not enter into repurchase agreements or
reverse repurchase agreements with PIMC, PNC Bank, National
Association ("PNC Bank"), PFPC Inc. ("PFPC"), Provident Distributors,
Inc. ("PDI") or any affiliated person (as such term is defined in the
1940 Act) of any of them, except to the extent permitted by the
Securities and Exchange Commission (the "SEC"). Furthermore, with
respect to such transactions, securities, deposits and repurchase
agreements, the Funds will not give preference to Service
Organizations with whom the Funds enter into agreements concerning
the provision of support services to customers who beneficially own
FedFund Dollar shares or T-Fund Dollar shares ("Dollar shares").
(See the Prospectuses, "Management of the Fund--Service
Organizations.")

The Funds do not intend to seek profits through
short-term trading. The Funds' annual portfolio turnover rates will
be relatively high but the Funds' portfolio turnover is not expected
to have a material effect on its net incomes. The portfolio

-3-
<PAGE> 36

turnover rate for each of the Funds is expected to be zero for
regulatory reporting purposes.

ADDITIONAL INFORMATION ON INVESTMENT PRACTICES

The repurchase price under the repurchase
agreements described in the Funds' Prospectuses generally equals the
price paid by a Fund plus interest negotiated on the basis of current
short-term rates (which may be more or less than the rate on the
securities underlying the repurchase agreement). Securities subject
to repurchase agreements will be held by the Funds' custodian,
sub-custodian or in the Federal Reserve/Treasury book-entry system.
Repurchase agreements are considered to be loans by the Funds under
the 1940 Act.

Whenever the Funds enter into reverse repurchase
agreements as described in their Prospectuses, they will place in a
segregated custodial account liquid assets having a value equal to
the repurchase price (including accrued interest) and will
subsequently monitor the account to ensure such equivalent value is
maintained. Reverse repurchase agreements are considered to be
borrowings by the Funds under the 1940 Act.

As stated in the Funds' Prospectuses, the Funds may
purchase securities on a "when-issued" basis (i.e., for delivery
beyond the normal settlement date at a stated price and yield). When
a Fund agrees to purchase when-issued securities, its custodian will
set aside cash or liquid portfolio securities equal to the amount of
the commitment in a separate account. Normally, the custodian will
set aside portfolio securities to satisfy a purchase commitment, and
in such a case such Fund may be required subsequently to place
additional assets in the separate account in order to ensure that the
value of the account remains equal to the amount of such Fund's
commitment. It may be expected that a Fund's net assets will
fluctuate to a greater degree when it sets aside portfolio securities
to cover such purchase commitments than when it sets aside cash.
Because the Funds will set aside cash or liquid assets to satisfy
their respective purchase commitments in the manner described, such
a Fund's liquidity and ability to manage its portfolio might be
affected in the event its commitments to purchase when-issued
securities ever exceeded 25% of the value of its assets. Neither
Fund intends to purchase when-issued securities for speculative
purposes but only in furtherance of its investment objectives. The
Funds reserve the right to sell the securities before the settlement
date if it is deemed advisable.

When a Fund engages in when-issued transactions, it
relies on the seller to consummate the trade. Failure of the

-4-
<PAGE> 37

seller to do so may result in a Fund's incurring a loss or missing an
opportunity to obtain a price considered to be advantageous.

With respect to loans by the Funds of their
portfolio securities as described in their Prospectuses, the Funds
would continue to accrue interest on loaned securities and would also
earn income on loans. Any cash collateral received by the Funds in
connection with such loans would be invested in short-term U.S.
government obligations.

Neither Fund will invest more than 10% of the value
of its assets in investments which are not readily marketable at the
time of purchase or subsequent valuation. Securities for purposes of
this limitation do not include securities which have been determined
to be liquid by the Fund's Board of Trustees based upon the trading
markets for such securities.

INVESTMENT LIMITATIONS

The Funds' Prospectuses summarize certain
investment limitations that may not be changed without the
affirmative vote of the holders of a "majority of the outstanding
shares" of the respective Fund (as defined below under
"Miscellaneous"). Below is a complete list of the Funds' investment
limitations that may not be changed without such a vote of
shareholders.

1. FedFund may not purchase securities other than
U.S. Treasury bills, notes and other obligations issued or guaranteed
by the U.S. Government, its agencies or instrumentalities, some of
which may be subject to repurchase agreements. There is no limit on
the amount of FedFund's assets which may be invested in the
securities of any one issuer of such obligations.

2. T-Fund may not purchase securities other than
direct obligations of the U.S. Treasury such as Treasury bills and
notes, some of which may be subject to repurchase agreements. There
is no limit on the amount of T-Fund's assets which may be invested in
securities of any one issuer of such obligations.

FedFund and T-Fund may not:

-5-
<PAGE> 38

borrowing provision is not for investment leverage, but solely
to facilitate management of each Fund by enabling the Company to meet
redemption requests where the liquidation of portfolio securities is
deemed to be inconvenient or disadvantageous.) Borrowing may take the
form of a sale of portfolio securities accompanied by a simultaneous
agreement as to their repurchase. Interest paid on borrowed funds will
not be available for investment.

4. Act as an underwriter.

5. Make loans except that the Funds may purchase
or hold debt obligations in accordance with their respective
investment objective and policies, may enter into repurchase
agreements for securities, and may lend portfolio securities against
collateral consisting of cash or securities which are consistent with
the lending Fund's permitted investments, which is equal at all times
to at least 100% of the value of the securities loaned. There is no
investment restriction on the amount of securities that may be loaned,
except that payments received on such loans, including amounts
received during the loan on account of interest on the securities
loaned, may not (together with all non-qualifying income) exceed 10%
of the Fund's annual gross income (without offset for realized
capital gains) unless, in the opinion of counsel to the Company, such
amounts are qualifying income under federal income tax provisions
applicable to regulated investment companies.

ADDITIONAL PURCHASE AND REDEMPTION INFORMATION

IN GENERAL

Information on how to purchase and redeem a Fund's
shares is included in its Prospectus. The issuance of shares is
recorded on the books of the Funds, and share certificates are not
issued unless expressly requested in writing. Certificates are not
issued for fractional shares.

The regulations of the Comptroller of the Currency
provide that funds held in a fiduciary capacity by a national bank
approved by the Comptroller to exercise fiduciary powers must be
invested in accordance with the instrument establishing the
fiduciary relationship and local law. The Company believes that the
purchase of FedFund shares and T-Fund shares by such national banks
acting on behalf of their fiduciary accounts is not contrary to
applicable regulations if consistent with the particular account and
proper under the law governing the administration of the account.

-6-
<PAGE> 39

Conflict of interest restrictions may apply to an
institution's receipt of compensation paid by the Funds on fiduciary
funds that are invested in Dollar shares. Institutions, including
banks regulated by the Comptroller of the Currency and investment
advisers and other money managers subject to the jurisdiction of the
SEC, the Department of Labor or state securities commissions, should
consult their legal advisors before investing fiduciary funds in
Dollar shares.

Prior to effecting a redemption of shares
represented by certificates, PFPC, the Funds' transfer agent, must
have received such certificates at its principal office. All such
certificates must be endorsed by the redeeming shareholder or
accompanied by a signed stock power, in each instance with the
signature guaranteed by a commercial bank, a member of a major stock
exchange or other eligible guarantor institution, unless other
arrangements satisfactory to the Funds have previously been made.
The Funds may require any additional information reasonably necessary
to evidence that a redemption has been duly authorized.

Under the 1940 Act, the Funds may suspend the right
of redemption or postpone the date of payment upon redemption for any
period during which the New York Stock Exchange is closed, other than
customary weekend and holiday closings, or during which trading on said
Exchange is restricted, or during which (as determined by the SEC by
rule or regulation) an emergency exists as a result of which disposal
or valuation of portfolio securities is not reasonably practicable, or
for such other periods as the SEC may permit. (The Funds may also
suspend or postpone the recordation of the transfer of their shares
upon the occurrence of any of the foregoing conditions.)

In addition, the Funds may redeem shares
involuntarily in certain other instances if the Board of Trustees
determines that failure to redeem may have material adverse
consequences to a Fund's shareholders in general. Each Fund is
obligated to redeem shares solely in cash up to $250,000 or 1% of the
Fund's net asset value, whichever is less, for any one shareholder
within a 90-day period. Any redemption beyond this amount will also
be in cash unless the Board of Trustees determines that conditions
exist which make payment of redemption proceeds wholly in cash unwise
or undesirable. In such a case, the Fund may make payment wholly or
partly in securities or other property, valued in the same way as the
Fund determines net asset value. (See "Net Asset Value" below for an
example of when such redemption or form of payment might be
appropriate.) Redemption in kind is not as liquid as a cash
redemption. Shareholders who receive a redemption in kind may incur
transaction costs if they sell such

-7-
<PAGE> 40

securities or property, and may receive less than the redemption value
of such securities or property upon sale, particularly where such
securities are sold prior to maturity.

Any institution purchasing shares on behalf of
separate accounts will be required to hold the shares in a single
nominee name (a "Master Account"). Institutions investing in more
than one of the Company's portfolios or classes of shares must
maintain a separate Master Account for each portfolio and class of
shares. Sub-accounts may be established by name or number either
when the Master Account is opened or later.

NET ASSET VALUE

As stated in each Fund's Prospectus, each Fund's
net asset value per share is calculated by adding the value of all
of the Fund's portfolio securities and other assets belonging to
that Fund, subtracting the liabilities charged to that Fund, and
dividing the result by the total number of that Fund's shares
outstanding (by class). "Assets belonging to" a Fund consist of the
consideration received upon the issuance of shares together with all
income, earnings, profits and proceeds derived from the investment
thereof, including any proceeds from the sale, exchange or
liquidation of such investments, any funds or payments derived from
any reinvestment of such proceeds, and a portion of any general
assets of the Company not belonging to a particular portfolio.
Assets belonging to a particular Fund are charged with the direct
liabilities of that Fund and with a share of the general liabilities
of the Company allocated in proportion to the relative net assets of
such Fund and the Company's other portfolios. Determinations made in
good faith and in accordance with generally accepted accounting
principles by the Board of Trustees as to the allocations of any
assets or liabilities with respect to a Fund are conclusive.

As stated in the Funds' Prospectuses, in computing
the net asset value of shares of the Funds for purposes of sales and
redemptions, the Funds use the amortized cost method of valuation.
Under this method, the Funds value each of their portfolio securities
at cost on the date of purchase and thereafter assume a constant
proportionate amortization of any discount or premium until maturity
of the security. As a result, the value of a portfolio security for
purposes of determining net asset value normally does not change in
response to fluctuating interest rates. While the amortized cost
method provides certainty in portfolio valuation, it may result in
valuations for the Funds' securities which are higher or lower than
the market value of such securities.

-8-
<PAGE> 41

In connection with their use of amortized cost
valuation, each of the Funds limits the dollar-weighted average
maturity of its portfolio to not more than 90 days and does not
purchase any instrument with a remaining maturity of more than
thirteen months (with certain exceptions). In determining the
average weighted portfolio maturity of each Fund, a variable rate
obligation that is issued or guaranteed by the U.S. Government, or
an agency or instrumentality thereof, is deemed to have a maturity
equal to the period remaining until the obligation's next interest
rate adjustment. The Company's Board of Trustees has also
established procedures, pursuant to rules promulgated by the SEC,
that are intended to stabilize the net asset value per share of each
Fund for purposes of sales and redemptions at $1.00. Such procedures
include the determination at such intervals as the Board deems
appropriate, of the extent, if any, to which each Fund's net asset
value per share calculated by using available market quotations or a
matrix believed to provide reliable values deviates from $1.00 per
share. In the event such deviation exceeds 1/2 of 1% with respect to
either Fund, the Board will promptly consider what action, if any,
should be initiated. If the Board believes that the amount of any
deviation from the $1.00 amortized cost price per share of a Fund may
result in material dilution or other unfair results to investors or
existing shareholders, it will take such steps as it considers
appropriate to eliminate or reduce to the extent reasonably practicable
any such dilution or unfair results. These steps may include selling
portfolio instruments prior to maturity; shortening the Fund's average
portfolio maturity; withholding or reducing dividends; redeeming shares
in kind; or utilizing a net asset value per share determined by using
available market quotations.

MANAGEMENT OF THE FUNDS

TRUSTEES AND OFFICERS

The Company's trustees and executive officers,
their addresses, principal occupations during the past five years
and other affiliations are provided below. In addition to the
information set forth below, the trustees serve in the following
capacities:

-9-
<PAGE> 42

("Chestnut"); Messrs. Pepper, Johnson and Santomero are directors of
Municipal Fund for California Investors, Inc. ("Cal Muni"); and Mr.
Johnson is a director of Municipal Fund for New York Investors, Inc.
("New York Muni") and a director of the International Dollar
Reserve Fund.

Each of the Company's officers, with the exception
of Mr. McConnel, holds like offices with Temp, PDI Fund and Muni. In
addition, Mr. McConnel is Secretary of PDI Fund and Temp; Mr. Roach is
Treasurer of Chestnut and PNC Fund, President and Treasurer of The RBB
Fund, Inc. and Vice President and Treasurer of ISIS, Cal Muni and New
York Muni; Mr. Pepper is President and Chairman of the Board of Muni,
President and Chairman of the Cal Muni and PNC Fund; and Mr. Fortune is
President and Chairman of the Board of ISIS and Managing General
Partners of Chestnut.

<TABLE>
<CAPTION>
Principal Occupations
Position with the During Past 5 Years
Name and Address Company and Other Affiliations
---------------- ----------------- ----------------------
<S> <C> <C>
PHILIP E. COLDWELL(3)(4) Trustee Economic Consultant;
Coldwell Financial Chairman, Coldwell Financial
Consultants Consultants, Member of the Board of
3330 Southwestern Blvd. Governors of the Federal Reserve
Dallas, Texas 75225 System, 1974 to 1980; President,
Federal Reserve Bank of Dallas, 1968
to 1974; Director, Maxus Energy
Corporation (energy products) (1989 -
1993); Director, Diamond Shamrock
Corp. (energy and chemical products)
until 1987.

ROBERT R. FORTUNE(2)(3)(4) Trustee Financial Consultant; Chairman,
2920 Ritter Lane President and Chief Executive Officer
Allentown, PA 18104 of Associated Electric & Gas
Insurance Services Limited, 1984-
1993; Member of the Financial
Executives Institute and American
Institute of Certified Public
Accountants; Director, Prudential
Utility Fund, Inc., Prudential
IncomeVertible Fund, Inc., and
Prudential Structured Maturity Fund,
Inc.
</TABLE>

-10-
<PAGE> 43
<TABLE>
<CAPTION>
Principal Occupations
Position with the During the Past 5 Years
Name and Address Company and Other Affiliations
---------------- ----------------- ----------------------
<S> <C> <C>
RODNEY D. JOHNSON Trustee President, Fairmount
Fairmount Capital Capital Advisors, Inc. (financial
Advisors, Inc. advising) since 1987; Treasurer,
1435 Walnut Street North Philadelphia Health System
Drexel Building (formerly Girard Medical Center),
Philadelphia, PA 19102 1988 to 1992; Member, Board of
Education, School District of
Philadelphia, 1983 to 1988;
Treasurer, Cascade Aphasia Center,
1984 to 1988.

G. WILLING PEPPER(1)(2) Chairman of the Board, Retired; Chairman of
128 Springton Lake Road President and Trustee the Board, The Institute for Cancer
Media, PA 19063 Research until 1979; Director,
Philadelphia National Bank until
1978; President, Scott Paper Company,
1971 to 1973; Chairman of the Board,
Specialty Composites Corp. until May
1984.

ANTHONY M. SANTOMERO Trustee Richard K. Mellon
310 Keithwood Road Professor of Finance since April
Wynnewood, PA 19096 1984, and Dean's Advisory Council
Member since July 1984, The Wharton
School, University of Pennsylvania;
Associate Editor, Journal of Banking
and Finance since June 1978;
Associate Editor, Journal of
Economics and Business since October
1979; Associate Editor, Journal of
Money, Credit and Banking since
January 1980; Research Associate, New
York University Center for Japan-US
Business and Economic Studies since
July 1989; Editorial Advisory Board,
Open Economics Review since November
1990; Director, The Zweig Fund and
The Zweig Total Return Fund.
</TABLE>

-11-
<PAGE> 44
<TABLE>
<CAPTION>
Principal Occupations
Position with the During the Past 5 Years
Name and Address Company and Other Affiliations
---------------- ----------------- ----------------------
<S> <C> <C>
DAVID R. WILMERDING, JR.(2) Vice Chairman of the President, Wilmerding &
Gates, Wilmerding, Carper Board and Trustee Co., Inc., Gates, Wilmerding, Carper
& Rawlings, Inc. & Rawlings, Inc. (investment
One Aldwyn Center advisers) since February l989;
Villanova, PA 19085 Director, Beaver Management
Corporation.

EDWARD J. ROACH Vice President Certified Public
Bellevue Park Corporate and Treasurer Accountant; Partner of the accounting
Center firm of Main Hurdman until 1981; Vice
400 Bellevue Parkway Chairman of the Board, Fox Chase
Suite 100 Cancer Center; Trustee Emeritus,
Wilmington, DE 19809 Pennsylvania School for the Deaf;
Trustee Emeritus, Immaculata College.

W. BRUCE McCONNEL, III Secretary Partner of the law
PNB Building firm of Drinker Biddle & Reath
1345 Chestnut Street Philadelphia, Pennsylvania.
Philadelphia, PA
19107-3496
</TABLE>

-------------------------

(1) This trustee is considered by the Company to be an
"interested person" of the Company as defined in the 1940 Act.

(2) Executive Committee Member.

(3) Audit Committee Member.

(4) Nominating Committee Member.

During intervals between meetings of the Board, the
Executive Committee may exercise the authority of the Board of
Trustees in the management of the Company's business to the extent
permitted by law.

Each of the investment companies named above
receives various advisory and other services from PIMC and PNC. Of
the above-mentioned funds, PDI provides distribution services to Temp,
Muni, PDI Fund, PNC Fund, Cal Muni and New York Muni. Of the
above-mentioned funds, the administrators provide administration
services to Temp, Muni, PDI Fund, PNC Fund, Cal Muni and New York Muni.

-12-
<PAGE> 45
For the fiscal year ended October 31, 1994, the
Company paid a total of $99,478 to its officers and trustees in all
capacities of which $47,633 was allocated to the Funds. In addition,
the Company contributed $2,678 during its last fiscal year to its
retirement plan for employees (which included Mr. Roach) of which
$1,289 was allocated to the Funds. Drinker Biddle & Reath, of which
Mr. McConnel is a partner, receives legal fees as counsel to the
Company. No employee of PDI, PIMC, PFPC or PNC Bank receives any
compensation from the Company for acting as an officer or trustee of
the Company. The trustees and officers of the Company as a group
beneficially own less than 1% of the shares of the Company's FedFund,
T-Fund, FedCash, T-Cash, Federal Trust Fund, Treasury Trust Fund and
Short Government Fund portfolios.

By virtue of the responsibilities assumed by PDI,
PIMC, PFPC and PNC Bank under their respective agreements with the
Company, the Company itself requires only one part-time employee in
addition to its officers.

The table below sets forth the compensation actually
received from the Fund Complex of which the Fund is a part by the
trustees for the fiscal year ended October 31, 1994:
<TABLE>
<CAPTION>
Total
Pension or Compensation
Retirement from Registrant
Aggregate Benefits Accrued Estimated Annual and Fund
Name of Person, Compensation as Part of Fund Benefits Upon Complex(1) Paid to
Position from Registrant Expenses Retirement Trustees
<S> <C> <C> <C> <C>
Philip E. Coldwell, $ 11,500.00 0 N/A (3)(2) $ 44,025.00
Trustee

Robert R. Fortune, 11,500.00 0 N/A (5)(2) 56,325.00
Trustee

Rodney D. Johnson, 11,500.00 0 N/A (5)(2) 54,775.00
Trustee

G. Willing Pepper, 20,500.00 0 N/A (6)(2) 98,275.00
Trustee and Chairman

Henry M. Watts, Jr.(3), 4,000.00 0 N/A (7)(2) 54,775.00
Trustee
</TABLE>

---------------------------------

1. A Fund Complex means two or more investment companies that
hold themselves out to investors as related companies for
purposes of investment and investor services, or have a
common investment adviser or have an investment adviser that
is an affiliated person of the investment adviser of any of
the other investment companies.

2. Total number of such other investment companies trustee
serves on within the Fund Complex.

3. Mr. Watts resigned as trustee of the Company on May 4, 1994.

-13-
<PAGE> 46
<TABLE>
<S> <C> <C> <C> <C>
David R. Wilmerding, 13,166.68 0 N/A (5)(2) 61,025.04
Jr., Trustee

Anthony M. Santomero, 11,500.00 0 N/A (4)(2) 44,025.00
---------- ---------
Trustee
$83,666.68 $413,225.04
</TABLE>

INVESTMENT ADVISER AND SUB-ADVISER

The advisory and sub-advisory services provided by
PIMC and PNC Bank are described in the Funds' Prospectuses. For the
advisory services provided and expenses assumed by it, PIMC is
entitled to receive a fee, computed daily and payable monthly, based
on the combined average net assets of the Funds, FedCash, T-Cash,
Federal Trust Fund and Treasury Trust Fund, as follows:

Annual Fee The Funds' Combined
---------- Average Net Assets
--------------------
<S> <C>
.175% . . . . . . . . . . . . . . . . of the first $1 billion
.150% . . . . . . . . . . . . . . . . of the next $1 billion
.125% . . . . . . . . . . . . . . . . of the next $1 billion
.100% . . . . . . . . . . . . . . . . of the next $1 billion
.095% . . . . . . . . . . . . . . . . of the next $1 billion
.090% . . . . . . . . . . . . . . . . of the next $1 billion
.085% . . . . . . . . . . . . . . . . of the next $1 billion
.080% . . . . . . . . . . . . . . . of amounts in excess of $7 billion.
</TABLE>

The advisory fee is allocated between these Funds in proportion to
their relative net assets.

PIMC and the administrators have each agreed that
if, in any fiscal year, the expenses borne by a Fund exceed the
applicable expense limitations imposed by the securities regulations
of any state in which shares of the particular Fund are registered
or qualified for sale to the public, they will each reimburse such
Fund for one-half of any excess to the extent required by such
regulations. Unless otherwise required by law, such reimbursement
would be accrued and paid on the same basis that the advisory and
administration fees are accrued and paid by such Fund. To the Funds'
knowledge, of the expense limitations in effect on the date of this
Statement of Additional Information, none is more restrictive than
two and one-half percent (2-1/2%) of the first $30 million of a
Fund's average annual net assets, two percent (2%) of the next
$70 million of the average annual net assets and one and one-half
percent (1-1/2%) of the remaining average annual net assets.

For the fiscal years ended October 31, 1992, 1993
and 1994, the Company paid fees (net of waivers) for advisory services
aggregating $3,233,661, $1,488,938 and $924,760 with respect to
FedFund, and $1,655,342, $1,081,025 and $819,525 with respect to
T-Fund, respectively. For the same fiscal years, PIMC

-14-
<PAGE> 47
voluntarily waived advisory fees aggregating $0, $630,847 and
$807,814 with respect to FedFund, and, $0 and $526,120 and $655,034
with respect to T-Fund, respectively. Any fees waived by PIMC are not
recoverable. PIMC and PNC Bank also serve as the adviser and
sub-adviser, respectively, to the Company's FedCash, T-Cash, Federal
Trust Fund, Treasury Trust Fund and Short Government Fund portfolios.

BANKING LAWS

Certain banking laws and regulations with respect to investment
companies are discussed in the Funds' Prospectuses. PIMC, PNC Bank
and PFPC believe that they may perform the services for the Funds
contemplated by their respective agreements, Prospectuses and this
Statement of Additional Information without violation of applicable
banking laws or regulations. It should be noted, however, that future
changes in legal requirements relating to the permissible activities
of banks and their affiliates, as well as further interpretations of
present requirements, could prevent PIMC and PFPC from continuing to
perform such services for the Funds and PNC Bank from continuing to
perform such services for PIMC and the Funds. If PIMC, PFPC, or PNC
Bank were prohibited from continuing to perform such services, it is
expected that the Company's Board of Trustees would recommend that the
Funds enter into new agreements with other qualified firms. Any new
advisory agreement would be subject to shareholder approval.

In addition, state securities laws on this issue may differ
from the interpretations of federal law expressed herein and banks and
financial institutions may be required to register as dealers pursuant
to State law.

ADMINISTRATOR

As the Funds' administrators, PFPC and PDI have agreed to
provide the following services: (i) assist generally in supervising
the Funds' operations, including providing a Wilmington, Delaware
order-taking facility with toll-free IN-WATS telephone lines,
providing for the preparing, supervising and mailing of purchase and
redemption order confirmations to shareholders of record, providing
and supervising the operation of an automated data processing system
to process purchase and redemption orders, maintaining a back-up
procedure to reconstruct lost purchase and redemption data, providing
information concerning the Funds to their shareholders of record,
handling shareholder problems, supervising the services of employees,
provided by PDI, whose principal responsibility and function is to
preserve and strengthen shareholder relations, and monitoring the
arrangements pertaining to the Funds' agreements with Service
Organizations; (ii) assure that persons are available to receive

-15-
<PAGE> 48
and transmit purchase and redemption orders; (iii) participate in the
periodic updating of the Funds' Prospectuses and Registration
Statements; (iv) assist in maintaining the Funds' Wilmington, Delaware
office; (v) perform administrative services in connection with the
Fund's computer access program maintained to facilitate shareholder
access to the Funds; (vi) accumulate information for and coordinate the
preparation of reports to the Funds' shareholders and the SEC; (vii)
maintain the registration or qualification of the Funds' shares for
sale under state securities laws; (viii) prepare or review, and provide
advice with respect to, all sales literature (advertisements, brochures
and shareholder communications) for each of the Funds and any class or
sub-class thereof; and (ix) assist in the monitoring of regulatory and
legislative developments which may affect the Company, participate in
counseling and assisting the Company in relation to routine regulatory
examinations and investigations, and work with the Company's counsel in
connection with regulatory matters and litigation.

For their administrative services, the
administrators are entitled jointly to receive fees from the six
Funds referred to above determined and allocated in the same manner
as PIMC's advisory fee set forth above. As stated in their
Prospectuses, each administrator is also reimbursed for its
reasonable out-of-pocket expenses incurred in connection with the
Fund's computer access program. For the fiscal year ended October 31,
1992, the Company paid fees (net of waivers) for administrative
services to its former administrator, The Boston Company Advisors,
Inc. ("Boston Advisors"), aggregating $3,233,661 with respect
to FedFund, and $1,655,342 with respect to T-Fund, respectively.
Boston Advisors did not waive administration fees for either Fund
during the fiscal year 1992. For the period from October 1, 1992
through January 17, 1993 the Company paid fees (net of waivers) to its
former administrator, The Boston Company Advisors totalling $99,699
with respect to FedFund and $65,982 with respect to T-Fund.
Administration fees payable by FedFund and T-Fund of $2,554 and $494,
respectively, were voluntarily waived by Boston Advisors during this
period. For the period from January 18, 1993 through October 31, 1993,
the Company paid fees (net of waivers) for administrative services to
PFPC and PDI (formerly called MFD Group, Inc.), its administrators,
aggregating $1,488,938 with respect to FedFund and $1,081,025 with
respect to T-Fund. For the same period, administration fees of
$630,847 with respect to FedFund and $526,120 with respect to T-Fund
were voluntarily waived. For the fiscal year ended October 31, 1994,
the Company paid fees (net of waivers) for administration fees
aggregating $924,760 with respect to FedFund and $807,814 with respect
to T-Fund, respectively. For the same fiscal year, PFPC and PDI
voluntarily waived administration fees aggregating $819,525 with
respect to FedFund and $655,034 with respect to T-Fund, respectively.

-16-
<PAGE> 49
PFPC, a wholly owned, indirect subsidiary of PNC
Bank provides administrative or and/or sub-administrative services to
investment companies which are distributed by PDI. PFPC and PDI also
serve as co-administrators of the Company's FedCash, T- Cash, Federal
Trust Fund, Treasury Trust Fund and Short Government Fund portfolios.

DISTRIBUTOR

PDI acts as the distributor of the Funds' shares.
Each Fund's shares are sold on a continuous basis by the distributor
as agent, although it is not obliged to sell any particular amount of
shares. PDI will prepare or review, provide advice with respect to,
and file with the federal and state agencies or other organization as
required by federal, state, or other applicable laws and regulations,
all sales literature (advertisements, brochures and shareholder
communications) for each of the Funds and any class or sub-class
thereof. The distributor pays the cost of printing and distributing
prospectuses to persons who are not shareholders of the Funds
(excluding preparation and printing expenses necessary for the
continued registration of Fund shares) and of preparing, printing and
distributing all sales literature. No compensation is payable by the
Funds to the distributor for its distribution services. PDI also
serves as the distributor for the Company's FedCash, T-Cash, Federal
Trust Fund, Treasury Trust Fund and Short Government Fund portfolios.
PDI is a Delaware corporation, with its principal place of business
located at 259 Radnor-Chester Road, Suite 120, Radnor, Pennsylvania
19087.

CUSTODIAN AND TRANSFER AGENT

Pursuant to a Custodian Agreement, PNC Bank serves
as the Funds' custodian. Under the Agreement, PNC Bank has agreed to
provide the following services: (i) maintain a separate account or
accounts in the name of the Funds; (ii) hold and disburse portfolio
securities on account of the Funds; (iii) collect and make
disbursements of money on behalf of the Funds; (iv) collect and
receive all income and other payments and distributions on account of
the Funds' portfolio securities; and (v) make periodic reports to the
Board of Trustees concerning the Funds' operations. The Custodian
Agreement permits PNC Bank, on 30 days' notice, to assign its rights
and delegate its duties thereunder to any other affiliate of PNC Bank
or PNC Bank Corp., provided that PNC Bank remains responsible for the
performance of the delegate under the Custodian Agreement.

The Funds reimburse PNC Bank for its direct and
indirect costs and expenses incurred in rendering custodial

-17-
<PAGE> 50
services. Under the Custodian Agreement, each Fund pays PNC Bank an
annual fee equal to $.25 for each $1,000 of such Fund's average daily
gross assets, which fee declines as such Fund's average daily gross
assets increase. In addition, each Fund pays the custodian a fee for
each purchase, sale or delivery of a security, interest collection or
claim item, and reimburses PFPC for out- of-pocket expenses incurred on
behalf of the Fund. For the fiscal years ended October 31, 1992, 1993
and 1994, FedFund paid fees for custodian services aggregating,
$349,147, $254,450 and $220,443, respectively. For the same fiscal
years, T-Fund paid fees for custodian services aggregating, $226,417,
$216,000, and $202,087, respectively. PNC Bank also serves as
custodian for the Company's FedCash, T-Cash, Federal Trust Fund,
Treasury Trust Fund and Short Government Fund portfolios. PNC Bank's
principal business address is Broad and Chestnut Streets,
Philadelphia, Pennsylvania 19102.

PFPC also serves as the Funds' transfer agent,
registrar and dividend disbursing agent pursuant to a Transfer Agency
Agreement. Under the Agreement, PFPC has agreed to provide the
following services: (i) maintain a separate account or accounts in
the name of the Funds; (ii) issue, transfer and redeem shares of the
Funds; (iii) disburse dividends and distributions, in the manner
described in each Fund's Prospectus, to shareholders of the Fund;
(iv) transmit all communications by the Funds to their shareholders
or their authorized representatives, including reports to
shareholders, distribution and dividend notices and proxy materials
for meetings of shareholders; (v) prepare and file with the
appropriate taxing authorities reports or notices relating to
dividends and distributions made by the Funds; (vi) respond to
correspondence by shareholders, security brokers and others relating
to its duties; (vii) maintain shareholder accounts; and (viii)
make periodic reports to the Company's Board of Trustees concerning the
Funds' operations. The Transfer Agency Agreement permits PFPC, on
30-days' notice, to assign its rights and duties thereunder to any
other affiliate of PNC Bank or PNC Bank Corp., provided that PFPC
remains responsible for the performance of the delegate under
the Transfer Agency Agreement.

Under the Transfer Agency Agreement, each Fund pays
PFPC fees at an annual rate of $12.00 per account and sub- account
maintained by PFPC plus $1.00 for each purchase or redemption
transaction by an account (other than a purchase transaction made
in connection with the automatic reinvestment of dividends).
Payments to PFPC for sub-accounting services provided by others are
limited to the amount which PFPC pays to others for such services.
In addition, the Funds reimburse PFPC for out-of-pocket expenses
related to such services. For the fiscal years ended October 31, 1992,
1993 and 1994, FedFund paid fees for transfer agency services
aggregating, $159,340, $147,259 and

-18-
<PAGE> 51
$189,439, respectively. For the same fiscal years, T-Fund paid fees
for transfer agency services aggregating, $123,706, $98,116 and
$81,291, respectively. PFPC also serves as transfer agent, registrar
and dividend disbursing agent for the Company's FedCash, T- Cash,
Federal Trust Fund, Treasury Trust Fund and Short Government Fund.

SERVICE ORGANIZATIONS

As stated in the Funds' Prospectuses, the Funds
will enter into an agreement with each Service Organization which
purchases Dollar shares requiring it to provide support services to
its customers who beneficially own Dollar shares in consideration of
the Funds' payment of .25% (on an annualized basis) of the average
daily net asset value of the Dollar shares held by the Service
Organization for the benefit of customers. Such services include:
(i) aggregating and processing purchase and redemption requests from
customers and placing net purchase and redemption orders with the
transfer agent; (ii) providing customers with a service that invests
the assets of their accounts in Dollar shares; (iii) processing
dividend payments from the Funds on behalf of customers; (iv)
providing information periodically to customers showing their
positions in Dollar shares; (v) arranging for bank wires; (vi)
responding to customer inquiries relating to the
services performed by the Service Organization; (vii) providing
sub-accounting with respect to Dollar shares beneficially owned by
customers or the information necessary for sub- accounting; (viii)
forwarding shareholder communications from the Funds (such as proxies,
shareholder reports, annual and semi- annual financial statements and
dividend, distribution and tax notices) to customers, if required by
law; and (ix) other similar services if requested by the Funds. For
the fiscal year ended October 31, 1994, the Company paid $145,430 in
servicing fees to an affiliate of the Company's adviser (representing
12.0% of the aggregate servicing fees) of which $101,779 and $43,651
was allocated to FedFund and T-Fund, respectively, pursuant to service
agreements in effect during such period.

Each Fund's agreements with Service Organizations
are governed by a Shareholder Services Plan (the "Plan") that has
been adopted by the Company's Board of Trustees pursuant to an
exemptive order granted by the SEC in connection with the creation of
the Dollar shares. Pursuant to each Plan, the Board of Trustees
reviews, at least quarterly, a written report of the amounts expended
under the Fund's agreements with Service Organizations and the
purposes for which the expenditures were made. In addition, the
Funds' arrangements with Service Organizations must be approved
annually by a majority of the Company's trustees, including a
majority of the trustees who are not "interested persons"
of the Company as defined in the 1940

-19-
<PAGE> 52
Act and have no direct or indirect financial interest in such
arrangements (the "Disinterested Trustees").

The Board of Trustees has approved the Funds'
arrangements with Service Organizations based on information provided
by the Funds' service contractors that there is a reasonable
likelihood that the arrangements will benefit the Funds and their
shareholders by affording the Funds greater flexibility in connection
with the servicing of the accounts of the beneficial owners of
their shares in an efficient manner. Any material amendment to the
Funds' arrangements with Service Organizations must be approved by a
majority of the Company's Board of Trustees (including a majority of
the Disinterested Trustees). So long as the Funds' arrangements with
Service Organizations are in effect, the selection and nomination of
the members of the Company's Board of Trustees who are not
"interested persons" (as defined in the 1940 Act)
of the Company will be committed to the discretion of such
non-interested trustees.

EXPENSES

The Funds' expenses include taxes, interest, fees
and salaries of the Company's trustees and officers, SEC fees, state
securities qualification fees, Standard & Poor's rating fees
(cost incurred by T-Fund only), Moody's rating fees (cost incurred by
T-Fund only), costs of preparing and printing prospectuses for
regulatory purposes and for distribution to shareholders, advisory
and administration fees, charges of the custodian, transfer agent
and dividend disbursing agent, Service Organization fees, certain
insurance premiums, outside auditing and legal expenses, costs of the
Funds' computer access program, costs of shareholder reports and
shareholder meetings and any extraordinary expenses. The Funds also
pay for brokerage fees and commissions (if any) in connection with
the purchase of portfolio securities.

ADDITIONAL INFORMATION CONCERNING TAXES

The following summarizes certain additional tax
considerations generally affecting each Fund and its shareholders
that are not described in each Fund's Prospectus. No attempt is
made to present a detailed explanation of the tax treatment of the
Funds or their shareholders or possible legislative changes, and the
discussion here and in each Fund's Prospectus is not intended as a
substitute for careful tax planning. Investors should consult their
tax advisors with specific reference to their own tax situations.

-20-
<PAGE> 53
Each Fund of the Company is treated as a separate
corporate entity under the Code and intends to qualify each year as a
regulated investment company under the Code. In order to so qualify
for a taxable year, each Fund must satisfy the distribution requirement
described in its Prospectus, derive at least 90% of its gross income
for the year from certain qualifying sources, comply with certain
diversification requirements and derive less than 30% of its gross
income from the sale or other disposition of securities and certain
other investments held for less than three months. Interest (including
original issue discount and accrued market discount) received by a Fund
upon maturity or disposition of a security held for less than three
months will not be treated as gross income derived from the sale or
other disposition of such security within the meaning of this
requirement. However, any other income that is attributable to realized
market appreciation will be treated as gross income from the sale or
other disposition of securities for this purpose.

A 4% nondeductible excise tax is imposed on
regulated investment companies that fail to distribute currently an
amount equal to specified percentages of their ordinary taxable
income and capital gain net income (excess of capital gains over
capital losses). Each Fund intends to make sufficient distributions
or deemed distributions of its ordinary taxable income and any
capital gain net income each calendar year to avoid liability
for this excise tax.

If for any taxable year a Fund does not qualify for
tax treatment as a regulated investment company, all of its taxable
income will be subject to federal income tax at regular corporate
rates, without any deduction for distributions to Fund shareholders.
In such event, dividend distributions would be taxable as ordinary
income to Fund shareholders to the extent of that Fund's current and
accumulated earnings and profits and would be eligible for the
dividends received deduction in the case of corporate shareholders.

Each Fund will be required in certain cases to
withhold and remit to the U.S. Treasury 31% of taxable dividends or
gross sale proceeds paid to any shareholder who has failed to
provide a correct tax identification number in the manner required,
who is subject to withholding by the Internal Revenue Service for
failure to properly include on his return payments of taxable
interest or dividends, or who has failed to certify to the Fund when
required to do so that he is not subject to backup withholding or
that he is an "exempt recipient."

Depending upon the extent of the Funds' activities
in states and localities in which their offices are maintained, in
which their agents or independent contractors are located or in

-21-
<PAGE> 54
which they are otherwise deemed to be conducting business, the Funds
may be subject to the tax laws of such states or localities. In
addition, in those states and localities which have income tax laws,
the treatment of the Funds and their shareholders under such laws may
differ from their treatment under federal income tax laws.
Shareholders are advised to consult their tax advisors concerning the
application of state and local taxes.

The foregoing discussion is based on federal tax
laws and regulations which are in effect on the date of this
Statement of Additional Information; such laws and regulations may be
changed by legislative or administrative action.

DIVIDENDS

Net income of each of the Funds for dividend
purposes consists of (i) interest accrued and original issue discount
earned on the Fund's assets, (ii) plus the amortization of market
discount and minus the amortization of market premium on such assets,
(iii) less accrued expenses directly attributable to the Fund and the
general expenses (e.g., legal, accounting and trustees' fees) of the
Company prorated to the Fund on the basis of its relative net assets.
In addition, Dollar shares bear exclusively the expense of fees paid
to Service Organizations. (See "Management of the Funds--Service
Organizations.")

As stated, the Company uses its best efforts to
maintain the net asset value per share of FedFund and T-Fund at
$1.00. As a result of a significant expense or realized or
unrealized loss incurred by either Fund, it is possible that the
Fund's net asset value per share may fall below $1.00.

ADDITIONAL YIELD INFORMATION

The "yields" and "effective yields" are calculated
separately for each class of shares of each Fund and in accordance
with the formulas prescribed by the SEC. The seven-day yield for
each class of shares is calculated by determining the net change in
the value of a hypothetical pre-existing account in the particular
Fund which has a balance of one share of the class involved at the
beginning of the period, dividing the net change by the value of the
account at the beginning of the period to obtain the base period
return, and multiplying the base period return by 365/7. The net
change in the value of an account in a Fund includes the value of
additional shares purchased with dividends from the original share
and dividends declared on the original share and any such additional
shares, net of all fees charged to all shareholder accounts in
proportion

-22-
<PAGE> 55
to the length of the base period and the Fund's average account size,
but does not include gains and losses or unrealized appreciation and
depreciation. In addition, an effective annualized yield quotation
may be computed on a compounded basis with respect to each class of
its shares by adding 1 to the base period return for the class
involved (calculated as described above), raising that sum to a power
equal to 365/7, and subtracting 1 from the result. Similarly, based on
the calculations described above, the Funds' 30-day (or
one-month) yields and effective yields may also be calculated.

For the seven-day period ended October 31, 1994,
the yields on FedFund shares and T-Fund shares were 4.86% and 4.70%,
respectively, and the compounded effective yields on FedFund shares
and T-Fund shares were 4.98% and 4.81%, respectively; the yields on
FedFund Dollar shares and T-Fund Dollar shares were 4.61% and 4.45%,
respectively, and the compounded effective yields on FedFund Dollar
shares and T-Fund Dollar shares were 4.72% and 4.55%, respectively.
During this seven-day period, the Funds' adviser and administrator
voluntarily waived a portion of its advisory and administration fees
payable by the Funds. Without these waivers, for the same period the
yields on FedFund shares and T-Fund shares would have been 4.74% and
4.59%, respectively, and the compounded effective yields on FedFund
shares and T-Fund shares would have been 4.85% and 4.69%,
respectively, the yield on FedFund Dollar Shares and T-Fund Dollar
Shares would have been 4.49% and 4.34%, respectively, and the
compounded effective yields on FedFund Dollar Shares and T-Fund
Dollar Shares would have been 4.59% and 4.43%, respectively.

For the 30-day period ended October 31, 1994, the
yields on FedFund shares and T-Fund shares were 4.81% and 4.68%,
respectively, and the compounded effective yields on FedFund shares
and T-Fund shares were 4.93% and 4.79%, respectively; the yields on
FedFund Dollar shares and T-Fund Dollar shares were 4.56% and 4.43%,
respectively, and the compounded effective yields on FedFund Dollar
shares and T-Fund Dollar shares were 4.66% and 4.53%, respectively.
During this 30-day period, the Funds' adviser and administrator
voluntarily waived a portion of the advisory and administration fees
payable by the Funds. Without these waivers, for the same period the
yields on FedFund shares and T-Fund shares would have been 4.69% and
4.57%, respectively, and the compounded effective yields on FedFund
shares and T-Fund shares would have been 4.80% and 4.67%,
respectively, the yield on FedFund Dollar Shares and T-Fund Dollar
Shares would have been 4.44% and 4.32%, respectively, and the
compounded effective yields on FedFund Dollar Shares and T-Fund
Dollar Shares would have been 4.54% and 4.41%, respectively.

-23-
<PAGE> 56
From time to time, in advertisements or in reports
to shareholders, the performance of the Funds may be quoted and
compared to that of other money market funds or accounts with
similar investment objectives and to stock or other relevant indices.
For example, the yields of the Funds may be compared to the
Donoghue's Money Fund Average, which is an average compiled by
IBC/Donoghue's MONEY FUND REPORT(R) of Holliston, MA 01746, a widely
recognized independent publication that monitors the performance of
money market funds, or to the average yields reported by the Bank
Rate Monitor from money market deposit accounts offered by the 50
leading banks and thrift institutions in the top five standard
metropolitan statistical areas.

THE FUNDS' YIELDS WILL FLUCTUATE, AND ANY QUOTATION
OF YIELD SHOULD NOT BE CONSIDERED AS REPRESENTATIVE OF THE FUTURE
PERFORMANCE OF THE FUNDS. Since yields fluctuate, yield data cannot
necessarily be used to compare an investment in the Funds' shares
with bank deposits, savings accounts, and similar investment
alternatives which often provide an agreed or guaranteed fixed yield
for a stated period of time. Shareholders should remember that
performance and yield are generally functions of kind and quality of
the investments held in a portfolio, portfolio maturity, operating
expenses net of waivers and expense reimbursements, and market
conditions. Any fees charged by Service Organizations or other
institutional investors with respect to customer accounts in
investing in shares of the Funds will not be included in calculations
of yield and performance; such fees, if charged, would reduce
the actual performance and yield from that quoted.

ADDITIONAL DESCRIPTION CONCERNING FUND SHARES

The Company does not presently intend to hold
annual meetings of shareholders except as required by the 1940 Act
or other applicable law. Upon the written request of shareholders
owning at least twenty percent of the Company's shares, the Company
will call for a meeting of shareholders to consider the removal of
one or more trustees and other certain matters. To the extent
required by law, the Company will assist in shareholder communication
in such matters.

As stated in the Prospectuses for the Funds,
holders of the Company's FedFund and FedFund Dollar shares will vote
in the aggregate and not by class on all matters, except where
otherwise required by law and except that only FedFund Dollar shares
will be entitled to vote on matters submitted to a vote of
shareholders pertaining to the Fund's arrangements with Service
Organizations. (See "Management of the Funds--Service
Organizations.") Holders of the Company's T-Fund and
T-Fund Dollar shares will also vote in the aggregate and not by
class

-24-
<PAGE> 57
except as described above. Further, shareholders of all of the
Company's portfolios will vote in the aggregate and not by portfolio
except as otherwise required by law or when the Board of Trustees
determines that the matter to be voted upon affects only the interests
of the shareholders of a particular portfolio. Rule 18f-2 under the
1940 Act provides that any matter required to be submitted by the
provisions of such Act or applicable state law, or otherwise, to the
holders of the outstanding securities of an investment company such as
the Company shall not be deemed to have been effectively acted upon
unless approved by the holders of a majority of the outstanding shares
of each portfolio affected by the matter. Rule 18f-2 further provides
that a portfolio shall be deemed to be affected by a matter unless it
is clear that the interests of each portfolio in the matter are
identical or that the matter does not affect any interest of the
portfolio. Under the Rule the approval of an investment advisory
agreement or any change in a fundamental investment policy would be
effectively acted upon with respect to a portfolio only if approved by
the holders of a majority of the outstanding voting securities of such
portfolio. However, the Rule also provides that the ratification of
the selection of independent accountants, the approval of principal
underwriting contracts and the election of trustees are not subject to
the separate voting requirements and may be effectively acted upon by
shareholders of the investment company voting without regard to
portfolio.

COUNSEL

Drinker Biddle & Reath, Philadelphia National Bank
Building, 1345 Chestnut Street, Philadelphia, Pennsylvania 19107-3496,
of which W. Bruce McConnel, III, Secretary of the Company, is a
partner, serves as counsel to the Company and will pass upon the
legality of the shares offered hereby.

AUDITORS

The financial statements of the Funds which appear
in this Statement of Additional Information and the information
included in the Financial Highlights section which appears in the
Funds' Prospectuses have been audited by Coopers & Lybrand L.L.P.,
independent accountants, whose report thereon appears elsewhere
herein, and have been included herein and in the Funds' Prospectuses
in reliance upon the report of said firm of accountants given upon
their authority as experts in accounting and auditing. Coopers &
Lybrand L.L.P. has offices at 2400 Eleven Penn Center,
Philadelphia, Pennsylvania 19103.

-25-
<PAGE> 58
MISCELLANEOUS

SHAREHOLDER VOTE

As used in this Statement of Additional Information
and the Prospectuses for the Funds, a "majority of the outstanding
shares" of a Fund or of any other portfolio means the lesser of (1)
67% of the shares of such Fund (irrespective of class) or of the
portfolio represented at a meeting at which the holders of more than
50% of the outstanding shares of such Fund or portfolio are present
in person or by proxy, or (2) more than 50% of the outstanding shares
of such Fund (irrespective of class) or of the portfolio.

CERTAIN RECORD HOLDERS

On January 31, 1995, the name, address and
percentage of ownership of each institutional investor that owned of
record 5% or more of the outstanding shares of the Company's FedFund
and T-Fund portfolio were as follows:

<TABLE>
<CAPTION>
FedFund
-------
<S> <C>
U S Trust Company of New York 5.02%
Attn: Trading Operations
114 West 47th Street, 5th Floor
New York, NY 10036

Mercantile Bank N.A. 5.60%
Trust Securities Unit 17-1
Attn: Koleen (Dede) Clark
P.O. Box 387 Main Post Office
St. Louis, MO 63166

Saxon & Company/Custody 5.87%
PNC Bank
Income Collections 76-A-260
Airport Bus Ctr/Intl Court 2
200 Stevens Drive
Lester, PA 19113

Bank of America NT & SA 6.90%
The Private Bank #8329
Attn: ACI Unit
701 S. Western Avenue
Glendale, CA 91201

Securities Lending 13.45%
State Street Bank & Trust Co.
Global Securities Lending
Kerry Reardon/Mgmt Accountant
2 International Place, 31st Floor
Boston, MA 02110
</TABLE>

-26-
<PAGE> 59
<TABLE>
<S> <C>
Reinvested Earnings 5.63%
State Street Bank & Trust Co.
Kerry Reardon/Mgmt Accountant
2 International Place, 31st Floor
Boston, MA 02110

T-Fund
------

AKPAC & Co. 16.21%
Society/Key
Attn: Robyn Kudley
900 Euclid Avenue, 5th Floor
Cleveland, OH 44101

U S Trust Company of New York 5.90%
Attn: Trading Operations
114 West 47th Street, 5th Floor
New York, NY 10036

Integon Life Insurance Corp 14.30%
Head Asset Management
Attn: Dirk Russell
545 Madison Avenue, 6th Floor
New York, NY 10022

PNC Mortgage Securities Corp 6.29%
Attn: Trust Cash
700 Deerpath Drive
Vernon Hills, IL 60061
</TABLE>

SHAREHOLDER AND TRUSTEE LIABILITY

The Company is organized as a "business trust"
under the laws of the Commonwealth of Pennsylvania. Shareholders of
such a trust may, under certain circumstances, be held personally
liable (as if they were partners) for the obligations of the trust.
The Declaration of Trust of the Company provides that shareholders of
the Funds shall not be subject to any personal liability for the acts
or obligations of the Company and that every note, bond, contract,
order or other undertaking made by the Company shall contain a
provision to the effect that the shareholders are not personally
liable thereunder. The Declaration of Trust provides for
indemnification out of the trust property of any shareholder held
personally liable solely by reason of being or having been a
shareholder and not because of any acts or omissions or some
other reason. The Declaration of Trust also provides that the Company
shall, upon request, assume the defense of any claim made against any
shareholder for any act or obligation of the Company and satisfy any
judgment thereon. Thus, the risk of a shareholder's incurring
financial loss beyond its investment on account of shareholder
liability is limited to circumstances in which the Company itself
would be unable to meet its obligations.

-27-
<PAGE> 60
The Company's Declaration of Trust provides further
that no trustee, officer or agent of the Company shall be personally
liable for or on account of any contract, debt, tort, claim, damage,
judgment or decree arising out of or connected with the
administration or preservation of the trust estate or the conduct of
any business of the Company, nor shall any trustee be personally
liable to any person for any action or failure to act except by
reason of bad faith, willful misfeasance, gross negligence in the
performance of any duties or by reason of reckless disregard of the
obligations and duties as trustee. It also provides that all persons
having any claim against the trustees or the Company shall look solely
to the trust property for payment. With the exceptions stated, the
Declaration of Trust provides that a trustee is entitled to be
indemnified against all liabilities and expenses reasonably incurred
by him or her in connection with the defense or disposition of any
proceeding in which the trustee may be involved or with which the
trustee may be threatened by reason of being or having been a trustee,
and that the trustees have the power, but not the duty,
to indemnify officers and employees of the Company unless such person
would not be entitled to indemnification had he or she been a
trustee.

-28-
<PAGE> 61

REPORT OF INDEPENDENT ACCOUNTANTS

To the Shareholders and Board of Trustees of Trust for Federal Securities:

We have audited the accompanying statements of net assets of the FedFund,
T-Fund, FedCash, T-Cash, Federal Trust Fund, Treasury Trust Fund and Short
Government Fund Portfolios of Trust for Federal Securities (the "Fund") as of
October 31, 1994 and the related statements of operations for the year then
ended, the statements of changes in net assets for each of the two years in the
period then ended, and the financial highlights for each of the periods
presented. These financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
October 31, 1994, by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.

In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of the
FedFund, T-Fund, FedCash, T-Cash, Federal Trust Fund, Treasury Trust Fund and
Short Government Fund Portfolios of Trust for Federal Securities, as of October
31, 1994, the results of their operations for the year then ended, the changes
in their net assets for each of the two years in the period then ended, and the
financial highlights for each of the periods presented, in conformity with
generally accepted accounting principles.

COOPERS & LYBRAND L.L.P.

2400 Eleven Penn Center
Philadelphia, Pennsylvania
December 15, 1994

FS-1
<PAGE> 62

FEDFUND PORTFOLIO
Trust for Federal Securities
Statement of Net Assets

October 31, 1994
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
DISCOUNT RATE
OR PAR
COUPON RATE (000) VALUE
------------- -------- --------------
<S> <C> <C>
U.S. GOVERNMENT
SECURITIES-- 0.6%
U.S. Treasury Notes
12/31/94...... 4.625% $ 10,000 $ 10,017,084
--------------
Total.................... 10,017,084
--------------
AGENCY AND
INSTRUMENTALITY
OBLIGATIONS--57.3%
Federal Farm Credit
Bank Bonds
11/01/94...... 4.750 4,500 4,500,000
01/03/95...... 5.000 15,000 15,000,000
--------------
19,500,000
--------------
Federal Farm Credit
Bank Discount Notes
11/01/94...... 4.600 1,500 1,500,000
06/26/95...... 5.200 14,000 13,520,733
--------------
15,020,733
--------------
Federal Home Loan
Bank Bonds
03/27/95...... 6.450 14,835 14,909,268
06/13/95...... 5.190 15,000 14,991,807
--------------
29,901,075
--------------
Federal Home Loan Bank Discount
Notes
11/04/94...... 4.620 15,000 14,994,225
11/07/94...... 4.640 20,000 19,984,533
02/28/95...... 5.400 25,000 24,553,750
03/28/95...... 5.310 15,000 14,674,763
04/17/95...... 5.580 20,000 19,482,300
05/08/95...... 5.500 25,000 24,281,944
--------------
117,971,515
--------------
Federal Home Loan Bank Variable
Rate Notes+
11/02/94...... 5.360 17,000 17,000,000
10/03/95...... 5.2175 30,000 29,986,192
10/20/95...... 4.780 20,000 19,984,894
--------------
66,971,086
--------------
Federal Home Loan Mortgage
Corporation
Discount Notes
02/15/95...... 5.250 24,000 23,629,000
02/23/95...... 5.420 20,000 19,656,733
--------------
43,285,733
--------------

<CAPTION>
DISCOUNT RATE
OR PAR
COUPON RATE (000) VALUE
------------- -------- --------------
<S> <C> <C>
Federal National
Mortgage Association
Discount Notes
11/04/94...... 4.600% $ 5,000 $ 4,998,083
11/07/94...... 4.890 10,000 9,991,850
11/10/94...... 4.650 25,000 24,970,938
11/17/94...... 4.880 50,000 49,891,556
11/29/94...... 4.690 15,000 14,945,283
11/29/94...... 4.750 25,000 24,907,639
12/16/94...... 4.660 25,000 24,854,375
12/23/94...... 4.800 20,000 19,861,333
12/29/94...... 4.770 20,000 19,846,300
02/17/95...... 5.090 20,000 19,694,600
03/22/95...... 5.330 40,000 39,164,966
03/31/95...... 5.370 20,000 19,552,500
06/30/95...... 5.500 10,000 9,631,806
--------------
282,311,229
--------------
Federal National Mortgage
Association Variable Rate
Notes+
11/01/94...... 4.820 75,000 75,000,000
11/01/94...... 5.750 40,000 40,000,000
--------------
115,000,000
--------------
Student Loan
Marketing
Association
Bonds
06/30/95...... 5.315 10,000 10,000,000
--------------
Student Loan
Marketing
Association
Variable Rate Notes+
11/01/94...... 5.360 4,000 4,002,120
11/01/94...... 5.380 47,850 47,837,160
11/01/94...... 5.400 22,000 21,999,492
11/01/94...... 5.410 10,000 10,000,000
11/01/94...... 5.420 10,000 10,007,604
11/01/94...... 5.510 55,000 55,031,260
11/01/94...... 5.540 11,600 11,606,064
11/01/94...... 5.560 20,000 20,022,047
11/01/94...... 5.585 71,520 71,699,582
11/01/94...... 5.610 18,700 18,779,062
--------------
270,984,391
--------------
Total.................... 970,945,762
--------------
</TABLE>

FS-2
<PAGE> 63

FEDFUND PORTFOLIO
Statement of Net Assets (Continued)

- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
DISCOUNT RATE
OR PAR
COUPON RATE (000) VALUE
------------- -------- --------------
<S> <C> <C>
REPURCHASE AGREEMENTS--42.2%
Donaldson Lufkin & Jenrette
Securities Corp.
11/01/94...... 4.900% $ 75,000 $ 75,000,000
(Agreement dated 10/31/94
to be repurchased at
$75,010,208,
collateralized by
$34,340,000 Federal Home
Loan Mortgage Corporation
Bonds 6.000% to 7.500%
due from 03/01/23 to
03/01/24; $132,735,000
Federal National Mortgage
Association Strips 8.000%
due from 01/01/24 to
07/01/24 and $50,434,000
Federal National Mortgage
Association Bonds 9.000%
to 10.000% due from
02/15/20 to 08/01/21. The
market value is
$77,250,462.)
First (The) Boston Corp.
11/10/94...... 4.800 30,000 30,000,000
(Agreement dated 08/15/94
to be repurchased at
$30,348,000,
collateralized by
$37,300,572, Federal Home
Loan Mortgage Corporation
Adjustable Rate Mortgage
Bonds 5.466% to 5.648%
due from 06/01/22 to
07/01/23. The market
value is $36,845,222.)
<CAPTION>
DISCOUNT RATE
OR PAR
COUPON RATE (000) VALUE
------------- -------- --------------
<S> <C> <C>
11/10/94...... 4.950% $ 40,000 $ 40,000,000
(Agreement dated 10/12/94
to be repurchased at
$40,159,500,
collateralized by
$45,880,580, Federal Home
Loan Mortgage Corporation
Adjustable Rate Mortgage
Bonds 4.025% to 6.031%
due from 08/01/23 to
06/01/24. The market
value is $45,785,289.)
11/17/94...... 4.800 40,000 40,000,000
(Agreement dated 10/19/94
to be repurchased at
$40,154,667,
collateralized by
$44,880,000, Federal Home
Loan Mortgage Corporation
Adjustable Rate Mortgage
Bonds 6.254% due from
11/17/94 to 04/01/24. The
market value is
$45,216,600.)
Greenwich Capital Markets, Inc.
11/01/94...... 4.900 70,000 70,000,000
(Agreement dated 10/31/94
to be repurchased at
$70,009,528,
collateralized by
$146,068,000, Resolution
Funding Corporation
Adjustable Rate Mortgage
Bonds 8.625% to 9.375%
due from 07/01/14 to
04/15/30 and $1,000,000
Student Loan Marketing
Association Floating Rate
Notes 3.510% due
07/01/96. The market
value is $71,502,581.)
</TABLE>

FS-3
<PAGE> 64

FEDFUND PORTFOLIO
Statement of Net Assets (Continued)

- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
DISCOUNT RATE
OR PAR
COUPON RATE (000) VALUE
------------- -------- -------------
<S> <C> <C>
REPURCHASE AGREEMENTS (CONTINUED)
Kidder, Peabody & Co., Inc.
11/01/94....... 4.890% $170,000 $ 170,000,000
(Agreement dated 10/31/94 to
be repurchased at
$170,023,092,
collateralized
by $228,684,284,
Government National
Mortgage Association Bonds
6.000% to 9.750% due from
08/15/08 to 11/15/30. The
market value is
$175,734,665.)
Lehman Government Securities,
Inc.
11/01/94....... 4.900 150,000 150,000,000
(Agreement dated 10/31/94 to
be repurchased at
$150,020,417,
collateralized by
$154,047,000, U.S.
Treasury Notes 4.375%
to 7.875% due from
07/31/96 to 08/15/04. The
market value is
$152,955,550.)
Merrill Lynch & Co., Inc.
11/17/94....... 4.850 40,000 40,000,000
(Agreement dated 10/19/94 to
be repurchased at
$40,156,277,
collateralized by
$41,400,000, Federal
National Mortgage
Association Notes 5.290%
due 07/28/97. The market
value is $40,882,500.)
<CAPTION>
DISCOUNT RATE
OR PAR
COUPON RATE (000) VALUE
------------- -------- --------------
<S> <C> <C>
PaineWebber Inc.
11/01/94...... 4.820% $ 98,800 $ 98,800,000
(Agreement dated 10/31/94
to be repurchased at
$98,813,228,
collateralized by
$8,411,100 Federal Farm
Credit Bank Strips,
5.375% to 5.470% due from
06/01/95 to 08/01/95;
$25,000,000 Federal Farm
Credit Bank Bonds 5.300%
due 07/05/95; $14,705,000
Federal National Mortgage
Association Discount
Notes 5.350% due
11/30/94; $6,993,000
Federal National Mortgage
Association Bonds 6.900%
to 8.050% due from
08/11/99 to 07/14/04;
$207,000 Federal Home
Loan Bank Floating Rate
Notes 6.500% to 7.000%
due 03/01/97; $43,014,900
Federal National Mortgage
Association Medium Term
Notes 6.150% to 6.870%
due 04/01/97 to 04/01/99
and $3,225,000 Student
Loan Marketing
Association Floating Rate
Notes 4.300% due
01/01/99. The market
value is $101,153,443.)
--------------
Total.................. 713,800,000
--------------
</TABLE>

FS-4
<PAGE> 65

FEDFUND PORTFOLIO
Statement of Net Assets (Concluded)

- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
VALUE
--------------
<S> <C> <C>
TOTAL INVESTMENT IN SECURITIES
(Cost $1,694,762,846*)....... 100.1% $1,694,762,846
LIABILITIES IN EXCESS OF OTHER
ASSETS....................... (0.1) (1,431,349)
------ --------------
NET ASSETS (equivalent to $1.00
per share based on
1,557,712,604 FedFund and
135,782,689 FedFund Dollar
shares of beneficial interest
outstanding)................. 100.0% $1,693,331,497
------ --------------
------ --------------
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE
($1,693,331,497 / 1,693,495,293)........ $1.00
-----
-----
</TABLE>

- ---------------
* Cost for federal income tax purposes.
+ Variable rate obligations--the rate shown is the rate as of October 31, 1994,
and the maturity date shown is the date the principal amount can be recovered
upon demand or put.

FEDFUND
Maturity Schedule of Portfolio
October 31, 1994

<TABLE>
<CAPTION>
MATURITY
PERIOD PAR PERCENTAGE
------------- -------------- ----------
<S> <C> <C>
1- 30 Days $1,287,470,000 75.7%
31- 60 Days 65,000,000 3.8
61- 90 Days 25,000,000 1.5
91-120 Days 89,000,000 5.2
Over 120 Days 233,835,000 13.8
</TABLE>

Average Weighted Maturity--41 Days

See accompanying notes to financial statements.

FS-5
<PAGE> 66

T-FUND PORTFOLIO
Trust for Federal Securities
Statement of Net Assets

October 31, 1994
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
DISCOUNT RATE
OR PAR
COUPON RATE (000) VALUE
------------- -------- --------------
<S> <C> <C>
U.S. GOVERNMENT
SECURITIES--23.7%
U.S. Treasury Bills
11/25/94...... 4.625% $ 30,000 $ 29,907,500
12/22/94...... 4.630 15,000 14,901,613
02/02/95...... 4.880 15,000 14,810,900
02/09/95...... 4.905 40,000 39,455,000
03/23/95...... 5.170 50,000 48,980,361
05/04/95...... 4.890 15,000 14,625,100
05/04/95...... 5.105 50,000 48,695,389
06/01/95...... 4.870 10,000 9,713,211
06/01/95...... 4.905 10,000 9,711,150
--------------
230,800,224
--------------
U.S. Treasury Notes
11/15/94...... 6.000 15,000 15,005,693
--------------
Total............................... 245,805,917
--------------
</TABLE>

<TABLE>
<S> <C> <C>
REPURCHASE AGREEMENTS--76.5%
Barclay De Zoete Wedd Limited
11/01/94...... 4.750 50,000 50,000,000
(Agreement dated 10/31/94
to be repurchased at
$50,006,597,
collateralized by
$44,935,000 U.S. Treasury
Notes 7.250% to 11.625%
due from 08/15/03 to
05/15/16. The market
value is $50,941,469.)
B.T. Securities Corp.
11/01/94...... 4.770 25,000 25,000,000
(Agreement dated 10/31/94
to be repurchased at
$25,003,313,
collateralized by
$25,760,000 U.S. Treasury
Bills due 01/12/95. The
market value is
$25,000,080.)
Daiwa Securities America, Inc.
11/01/94...... 4.750 50,000 50,000,000
(Agreement dated 10/31/94
to be repurchased at
$50,006,597,
collateralized by
$54,040,000 U.S. Treasury
Notes 7.250% due
05/15/16. The market
value is $51,056,992.)

<CAPTION>
DISCOUNT RATE
OR PAR
COUPON RATE (000) VALUE
------------- -------- --------------
<S> <C> <C>
Donaldson Lufkin & Jenrette
Securities Corp.
11/01/94...... 4.750% $ 50,000 $ 50,000,000
(Agreement dated 10/31/94
to be repurchased at
$50,006,597,
collateralized by
$50,670,000 U.S. Treasury
Notes 4.250% to 7.875%
due from 12/31/95 to
07/15/96. The market
value is $51,015,589.)
First (The) Boston Corp.
11/15/94...... 4.820 40,000 40,000,000
(Agreement dated 08/22/94
to be repurchased at
$40,455,222,
collateralized by
$38,955,000 U.S. Treasury
Notes 8.125% due
08/15/21. The market
value is $40,820,945.)
11/23/94...... 4.770 40,000 40,000,000
(Agreement dated 08/25/94
to be repurchased at
$40,477,000,
collateralized by
$40,530,000 U.S. Treasury
Notes 6.250% due
04/30/99. The market
value is $40,801,551.)
Kidder, Peabody & Co., Inc.
11/01/94...... 4.780 100,000 100,000,000
(Agreement dated 10/31/94
to be repurchased at
$100,013,278
collateralized by
$99,290,000 U.S. Treasury
Bonds 8.00% due 11/15/21.
The market value is
$102,000,889.)
Lehman Government Securities, Inc.
11/01/94...... 4.750 50,000 50,000,000
(Agreement dated 10/31/94
to be repurchased at
$50,006,597,
collateralized by
$50,955,000 U.S. Treasury
Notes 6.875% due
10/31/96. The market
value is $51,002,896.)
Merrill Lynch & Co., Inc.
11/01/94...... 4.800 50,000 50,000,000
(Agreement dated 10/31/94
to be repurchased at
$50,006,667,
collateralized by
$51,000,000 U.S. Treasury
Notes 4.625% due
02/29/96. The market
value is $51,003,871.)
</TABLE>

FS-6
<PAGE> 67

T-FUND PORTFOLIO
Statement of Net Assets (Concluded)

- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
DISCOUNT RATE
OR PAR
COUPON RATE (000) VALUE
------------- -------- --------------
<S> <C> <C>
REPURCHASE AGREEMENTS (CONTINUED)
Morgan (J.P.) Securities, Inc.
11/04/94...... 4.800% $ 45,000 $ 45,000,000
(Agreement dated 10/04/94
to be repurchased at
$45,186,000,
collateralized by
$47,110,000 U.S. Treasury
Notes 4.250% to 7.500%
due from 07/31/95 to
11/15/16. The market
value is $45,901,700.)
Morgan Stanley & Co.
11/01/94...... 4.8125 109,608 109,608,000
(Agreement dated 10/31/94
to be repurchased at
$109,622,652
collateralized by
$112,343,000 U.S.
Treasury Notes 5.125% to
6.125% due from 03/31/96
to 07/31/96. The market
value is $111,835,639.)
Nikko Securities, Inc.
11/01/94...... 4.770 50,000 50,000,000
(Agreement dated 10/31/94
to be repurchased at
$50,006,625,
collateralized by
$49,755,000 U.S. Treasury
Notes 7.500% due
11/15/01. The market
value is $51,008,826.)
Sanwa Bank BGK Securities
11/01/94...... 4.750 50,000 50,000,000
(Agreement dated 10/31/94
to be repurchased at
$50,006,597,
collateralized by
$49,830,000 U.S. Treasury
Notes 6.375% to 10.750%
due from 06/30/99 to
02/15/03. The market
value is $50,911,154.)
Smith Barney Inc.
12/30/94...... 5.200 60,000 60,000,000
(Agreement dated 10/06/94
to be repurchased at
$60,736,667,
collateralized by
$59,750,000 U.S. Treasury
Notes 7.500% to 8.875%
due from 11/15/01 to
08/15/17. The market
value is $61,723,125.)

<CAPTION>
DISCOUNT RATE
OR PAR
COUPON RATE (000) VALUE
------------- -------- --------------
<S> <C> <C>
Swiss Bank Corp.
11/01/94...... 4.800% $ 22,000 $ 22,000,000
(Agreement dated 10/31/94
to be repurchased at
$22,002,933,
collateralized by
$23,905,000 U.S. Treasury
Notes 6.375% to 7.500%
due from 05/15/02 to
08/15/02. The market
value is $22,502,714.)
--------------
Total............................. 791,608,000
--------------
TOTAL INVESTMENTS IN SECURITIES
(Cost $1,037,413,917*)....... 100.2% 1,037,413,917
LIABILITIES IN EXCESS OF OTHER
ASSETS....................... (0.2) (2,242,255)
------ --------------
NET ASSETS (equivalent to $1.00
per share based on
1,013,033,991 T-Fund and
22,194,581 T-Fund Dollar
shares of beneficial interest
outstanding)................. 100.0% $1,035,171,662
------ --------------
------ --------------
NET ASSET VALUE, OFFERING AND
REDEMPTION
PRICE PER SHARE
($1,035,171,662 / 1,035,228,572)........ $1.00
-----
-----
</TABLE>

- ---------------
* Cost for federal income tax purposes.

T-FUND
Maturity Schedule of Portfolio
October 31, 1994

<TABLE>
<CAPTION>
MATURITY
PERIOD PAR PERCENTAGE
------------- ------------ ----------
<S> <C> <C>
1- 30 Days $776,608,000 74.6%
31- 60 Days 75,000,000 7.2
91-120 Days 55,000,000 5.3
Over 120 Days 135,000,000 12.9
</TABLE>

Average Weighted Maturity--34 days

See accompanying notes to financial statements.

FS-7
<PAGE> 68

FEDCASH PORTFOLIO
Trust for Federal Securities
Statement of Net Assets

October 31, 1994
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
DISCOUNT RATE
OR PAR
COUPON RATE (000) VALUE
------------- ------- ------------
<S> <C> <C>
U.S. TREASURY NOTES--0.8%
12/31/94........ 4.625% $ 5,000 $ 5,008,540
------------
Total................................. 5,008,540
------------
AGENCY & INSTRUMENTALITY
OBLIGATIONS--62.2%
Federal Farm Credit
Bank Discount
Notes
01/13/95........ 5.030 10,000 9,898,003
03/06/95........ 4.950 10,000 9,828,125
04/25/95........ 5.600 10,000 9,727,778
------------
29,453,906
------------
Federal Home Loan
Bank Discount Notes
01/03/95........ 4.720 15,000 14,876,100
01/30/95........ 4.830 15,000 14,818,875
01/30/95........ 4.860 15,000 14,817,750
05/08/95........ 5.610 5,000 4,853,517
------------
49,366,242
------------
Federal Home Loan
Bank Variable Rate Notes+
11/01/94........ 4.800 10,000 9,996,396
10/20/95........ 4.780 10,000 9,992,447
------------
19,988,843
------------
Federal Home Loan
Mortgage Corporation
Discount Notes
12/30/94........ 4.800 10,000 9,921,333
------------
Federal National
Mortgage Association
Discount Notes
11/18/94........ 4.750 20,000 19,955,139
11/25/94........ 3.360 14,000 13,968,640
11/28/94........ 4.910 15,000 14,944,763
02/17/95........ 5.090 10,000 9,847,300
03/02/95........ 5.360 15,000 14,729,767
03/22/95........ 5.330 10,000 9,791,242
03/22/95........ 5.370 30,000 29,369,025
06/30/95........ 5.360 8,000 7,712,942
------------
120,318,818
------------
Federal National
Mortgage Association
Variable Rate Notes+
11/01/94........ 5.750 18,000 18,000,000
------------
Student Loan Marketing
Association
Discount Notes
12/02/94........ 4.740 15,000 14,938,775
------------

<CAPTION>
DISCOUNT RATE
OR PAR
COUPON RATE (000) VALUE
------------- ------- ------------
<S> <C> <C>
Student Loan Marketing
Association
Variable Rate Notes+
11/01/94........ 5.380% $25,000 $ 25,009,882
11/01/94........ 5.390 10,000 10,008,807
11/01/94........ 5.400 10,000 10,000,000
11/01/94........ 5.420 10,000 10,000,000
11/01/94........ 5.430 7,545 7,551,516
11/01/94........ 5.510 30,000 30,017,051
11/01/94........ 5.560 28,450 28,521,557
11/01/94........ 5.585 17,000 17,052,394
11/01/94........ 5.610 5,000 5,011,468
------------
143,172,675
------------
Total................................. 405,160,592
------------
REPURCHASE AGREEMENTS--37.2%
Donaldson, Lufkin & Jenrette Securities Corp.
11/01/94........ 4.900 75,000 75,000,000
(Agreement dated 10/31/94 to
be repurchased at
$75,010,208, collateralized
by $187,787,778 Federal
National Mortgage
Association Strips due
12/01/21 to 10/01/24. The
market value is
$77,250,717.)
First (The) Boston Corp.
11/10/94........ 4.950 20,000 20,000,000
(Agreement dated 10/12/94 to
be repurchased at
$20,079,750, collateralized
by $21,935,000 Federal Home
Loan Mortgage Corporation
Adjustable Rate Mortgage
Bonds 4.117% due 06/01/24.
The market value is
$21,441,463.)
Greenwich Capital Markets, Inc.
11/01/94........ 4.900 30,000 30,000,000
(Agreement dated 10/31/94 to
be repurchased at
$30,004,083, collateralized
by $29,965,000 U.S. Treasury
Bonds 8.125% to 8.875% due
from 02/15/19 to 08/15/19.
The market value is
$30,600,932.)
</TABLE>

FS-8
<PAGE> 69

FEDCASH PORTFOLIO
Statement of Net Assets (Concluded)

<CAPTION>
DISCOUNT RATE
OR PAR
COUPON RATE (000) VALUE
------------- ------- ------------
<S> <C> <C>
PaineWebber, Inc.
11/01/94........ 4.820% $17,800 $ 17,800,000
(Agreement dated 10/31/94
to be repurchased at
$17,802,383, collateralized
by $18,420,000 Federal
National Mortgage
Association Discount Notes
5.350% due 11/30/94. The
market value is
$18,337,111.)
------------
Total............................... 242,800,000
------------
TOTAL INVESTMENTS IN SECURITIES
(Cost $652,969,132*)............ 100.2% 652,969,132
LIABILITIES IN EXCESS OF
OTHER ASSETS.................... (0.2) (1,022,965)
------ ------------
NET ASSETS (Equivalent to $1.00
per share based on 629,261,242
FedCash and 22,742,508 FedCash
Dollar shares of beneficial
interest outstanding)........... 100.0% $651,946,167
------ ------------
------ ------------
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE
($651,946,167 / 652,003,750).............. $1.00
-----
-----
</TABLE>

- ---------------
* Cost for federal income tax purposes.
+ Variable Rate Obligations--The rate shown is the rate as
of October 31, 1994, and the maturity date is the date
the principal amount can be received upon demand or put.

FEDCASH
Maturity Schedule of Portfolio
October 31, 1994

<TABLE>
<CAPTION>
MATURITY
PERIOD PAR PERCENTAGE
------------- ------------ ----------
<S> <C> <C>
1- 30 Days $462,795,000 70.6%
31- 60 Days 25,000,000 3.8
61- 90 Days 30,000,000 4.6
91-120 Days 40,000,000 6.1
Over 120 Days 98,000,000 14.9
</TABLE>

Average Weighted Maturity--39 days

See accompanying notes to financial statements.

FS-9
<PAGE> 70

T-CASH PORTFOLIO
Trust for Federal Securities
Statement of Net Assets

October 31, 1994
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
DISCOUNT RATE
OR PAR
COUPON RATE (000) VALUE
------------- -------- ------------
<S> <C> <C>
U.S. GOVERNMENT SECURITIES--23.5%
U.S. Treasury Bills
11/17/94....... 4.770% $ 5,000 $ 4,989,400
11/17/94....... 4.810 5,000 4,989,311
11/25/94....... 4.625 10,000 9,969,167
02/09/95....... 4.905 15,000 14,795,625
02/09/95....... 4.950 10,000 9,862,500
06/01/95....... 4.905 3,000 2,913,345
08/24/95....... 5.355 10,000 9,559,700
------------
57,079,048
------------
U.S. Treasury Notes
11/15/94....... 6.000 10,000 10,003,795
02/28/95....... 3.875 5,000 4,981,674
------------
14,985,469
------------
Total................................. 72,064,517
------------
REPURCHASE AGREEMENTS--76.7%
B.T. Securities Corp.
11/01/94....... 4.770 8,000 8,000,000
(Agreement dated 10/31/94 to
be repurchased at
$8,001,060, collateralized
by $8,245,000 U.S. Treasury
Bills 8.500% due 01/12/95.
The market value is
$8,001,773.)
Barclay De Zoete Wedd Limited
11/01/94....... 4.750 16,000 16,000,000
(Agreement dated 10/31/94 to
be repurchased at
$16,002,111, collateralized
by $13,285,000 U.S.
Treasury Notes 10.375% due
11/15/12. The market value
is $16,331,251.)
Daiwa Securities America, Inc.
11/01/94....... 4.750 16,000 16,000,000
(Agreement dated 10/31/94 to
be repurchased at
$16,002,111, collateralized
by $17,740,000 U.S.
Treasury Notes 7.250% due
08/15/22. The market value
is $16,350,958.)

<CAPTION>
DISCOUNT RATE
OR PAR
COUPON RATE (000) VALUE
------------- -------- ------------
<S> <C> <C>
Donaldson, Lufkin & Jenrette
Securities, Inc.
11/01/94....... 4.750% $ 16,000 $ 16,000,000
(Agreement dated 10/31/94 to
be repurchased at
$16,002,111, collateralized
by $16,299,000 U.S.
Treasury Notes 3.875% due
02/28/95. The market value
is $16,326,708.)
First (The) Boston Corp.
11/15/94....... 4.820 15,000 15,000,000
(Agreement dated 08/22/94 to
be repurchased at
$15,170,708, collateralized
by $13,205,000 U.S.
Treasury Notes 9.250% due
02/15/16. The market value
is $15,309,877.)
11/23/94....... 4.770 15,000 15,000,000
(Agreement dated 08/25/94 to
be repurchased at
$15,178,875, collateralized
by $15,200,000 U.S.
Treasury Notes 6.500% due
04/30/99. The market value
is $15,301,840.)
J.P. Morgan Securities
11/04/94....... 4.800 20,000 20,000,000
(Agreement dated 10/04/94 to
be repurchased at
$20,082,667, collateralized
by $20,529,000 U.S.
Treasury Notes 4.250% due
07/31/95. The market value
is $20,399,667.)
Kidder, Peabody & Co., Inc.
11/01/94....... 4.780 30,000 30,000,000
(Agreement dated 10/31/94 to
be repurchased at
$30,003,983, collateralized
by $24,815,000 U. S.
Treasury Bonds 10.750% due
05/15/03. The market value
is $30,600,346.)
</TABLE>

FS-10
<PAGE> 71

T-CASH PORTFOLIO
Statement of Net Assets (Concluded)

<CAPTION>
VALUE
------------
<S> <C> <C>
TOTAL INVESTMENTS IN SECURITIES
(Cost $307,769,517*)........... 100.2% $307,769,517
LIABILITIES IN EXCESS OF OTHER
ASSETS......................... (0.2) (566,353)
------ ------------
NET ASSETS (equivalent to $1.00
per share based on 217,915,135
T-Cash and 89,291,139 T-Cash
Dollar shares of beneficial
interest outstanding).......... 100.0% $307,203,164
------ ------------
------ ------------
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE
($307,203,164 / 307,206,274).............. $1.00
</TABLE>

- ---------------
* Cost for federal income tax purposes.

T-CASH
Maturity Schedule of Portfolio
October 31, 1994

<TABLE>
<CAPTION>
MATURITY
PERIOD PAR PERCENTAGE
------------- ------------ ----------
<S> <C> <C>
1- 30 Days $245,705,000 79.6%
31- 60 Days 20,000,000 6.5
91-120 Days 30,000,000 9.7
Over 120 Days 13,000,000 4.2

</TABLE>
Average Weighted Maturity--29 days

See accompanying notes to financial statements.

FS-11
<PAGE> 72

FEDERAL TRUST FUND PORTFOLIO
Trust for Federal Securities
Statement of Net Assets

October 31, 1994
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
DISCOUNT RATE
OR PAR
COUPON RATE (000) VALUE
------------- -------- ------------
<S> <C> <C>
U.S. GOVERNMENT SECURITIES-- 0.2%
U.S. Treasury Bills
11/03/94...... 4.440% $ 68 $ 67,983
11/10/94...... 4.510 677 676,237
------------
Total................................ 744,220
------------
AGENCY AND INSTRUMENTALITY
OBLIGATIONS -- 100.0%
Federal Farm Credit Bank
Discount Notes
11/01/94...... 4.800 440 440,000
11/03/94...... 4.830 900 899,759
11/03/94...... 4.870 2,100 2,099,432
11/04/94...... 4.900 1,875 1,874,234
11/07/94...... 4.830 660 659,469
11/09/94...... 4.800 5,000 4,994,667
11/18/94...... 4.780 4,000 3,990,971
11/22/94...... 4.740 1,350 1,346,267
11/22/94...... 4.750 1,650 1,645,428
11/28/94...... 4.780 5,000 4,982,075
11/30/94...... 4.780 2,975 2,963,545
12/02/94...... 4.950 10,000 9,957,375
12/05/94...... 4.900 10,000 9,953,722
12/12/94...... 4.740 4,125 4,102,732
12/12/94...... 4.760 4,650 4,624,792
12/14/94...... 4.740 555 551,858
12/19/94...... 4.600 6,480 6,440,256
12/20/94...... 4.600 5,000 4,968,694
12/20/94...... 4.630 5,000 4,968,490
12/29/94...... 4.700 2,350 2,332,205
01/09/95...... 5.100 5,000 4,951,125
01/19/95...... 5.140 8,000 7,909,764
02/15/95...... 4.980 5,000 4,926,683
------------
91,583,543
------------
Federal Home Loan Bank
Discount Notes
11/07/94...... 4.940% 5,000 4,995,883
11/10/94...... 4.700 2,320 2,317,274
11/18/94...... 4.740 4,220 4,210,554
11/21/94...... 4.710 5,900 5,884,562
11/25/94...... 4.730 7,000 6,977,927
11/25/94...... 4.880 4,215 4,201,287
11/28/94...... 4.790 5,000 4,982,038

<CAPTION>
DISCOUNT RATE
OR PAR
COUPON RATE (000) VALUE
------------- -------- ------------
<S> <C> <C>
12/09/94...... 4.720% $ 4,280 $ 4,258,676
12/09/94...... 4.730 7,335 7,298,378
12/12/94...... 4.740 5,000 4,973,008
12/15/94...... 4.800 10,000 9,941,333
12/15/94...... 4.920 5,000 4,969,933
12/29/94...... 4.780 6,000 5,953,793
01/23/95...... 4.810 5,000 4,944,551
02/10/95...... 4.970 5,000 4,930,282
------------
80,839,479
------------
Federal Home Loan Bank Variable
Rate Notes+
11/01/94...... 4.800 25,000 24,990,991
------------
Student Loan Marketing
Association
Discount Notes
12/14/94...... 4.800 5,000 4,971,333
12/15/94...... 4.870 4,000 3,976,191
------------
8,947,524
------------
Student Loan Marketing
Association
Variable Rate Notes+
11/01/94...... 5.610 5,000 5,021,140
11/01/94...... 5.380 5,000 4,997,169
11/01/94...... 5.390 16,360 16,383,404
11/01/94...... 5.410 30,000 30,000,000
11/01/94...... 5.510 6,640 6,649,916
11/01/94...... 5.585 5,000 5,011,252
11/01/94...... 5.810 6,060 6,067,859
------------
74,130,740
------------
Tennessee Valley Authority
Notes
11/01/94...... 4.690 3,420 3,420,000
11/01/94...... 4.700 280 280,000
11/02/94...... 4.800 2,000 1,999,733
11/02/94...... 4.900 9,850 9,848,659
11/28/94...... 4.790 5,000 4,982,038
12/02/94...... 4.900 10,000 9,957,806
12/06/94...... 5.000 5,000 4,975,695
12/09/94...... 4.920 10,000 9,948,067
------------
45,411,998
------------
Total................................ 325,904,275
------------
</TABLE>

FS-12
<PAGE> 73

FEDERAL TRUST FUND PORTFOLIO
Statement of Net Assets (Concluded)

- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
VALUE
------------
<S> <C> <C>
TOTAL INVESTMENTS IN SECURITIES
(Cost $326,648,495*).......... 100.2% $326,648,495
LIABILITIES IN EXCESS OF
OTHER ASSETS.................. (0.2) (601,060)
------ ------------
NET ASSETS (Equivalent to $1.00
per share based on 317,928,045
Federal Trust and 8,279,970
Federal Trust Dollar shares of
beneficial interest
outstanding).................. 100.0% $326,047,435
NET ASSET VALUE, OFFERING
AND REDEMPTION PRICE PER
SHARE
($326,047,435 / 326,208,015)............. $1.00
</TABLE>

- ---------------
* Cost for federal income tax purposes is $326,655,858.
+ Variable Rate Obligations--the rate shown is the rate as
of October 31, 1994, and the maturity date is the date
the principal amount can be recovered upon demand or put.

FEDERAL TRUST FUND
Maturity Schedule of Portfolio
October 31, 1994
<TABLE>
<CAPTION>
MATURITY
PERIOD PAR PERCENTAGE
------------- ------------ ----------
<S> <C> <C>
1- 30 Days $179,960,000 54.9%
31- 60 Days 119,775,000 36.5%
61- 90 Days 18,000,000 5.5%
Over 90 Days 10,000,000 3.1%
</TABLE>

Average Weighted Maturity--27 days

See accompanying notes to financial statements.

FS-13
<PAGE> 74

TREASURY TRUST FUND PORTFOLIO
Trust for Federal Securities
Statement of Net Assets

October 31, 1994
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
DISCOUNT RATE
OR PAR
COUPON RATE (000) VALUE
------------- -------- --------------
<S> <C> <C>
U.S. GOVERNMENT
SECURITIES--98.6%
U.S. Treasury Bills
11/10/94..... 4.470% $ 2,739 $ 2,735,939
11/10/94..... 4.500 10,000 9,988,750
11/17/94..... 4.550 35,000 34,929,222
12/08/94..... 4.475 9,095 9,053,169
12/08/94..... 4.625 38,086 37,904,959
12/22/94..... 4.715 10,585 10,514,297
12/22/94..... 4.770 50,000 49,662,126
12/22/94..... 4.785 15,000 14,898,319
12/22/94..... 4.790 50,000 49,660,708
12/22/94..... 4.800 40,000 39,728,000
12/22/94..... 4.835 75,000 74,486,281
12/22/94..... 4.870 2,358 2,341,732
01/19/95..... 4.760 50,000 49,477,722
01/19/95..... 5.005 50,000 49,450,840
01/26/95..... 4.975 50,000 49,405,764
--------------
484,237,828
--------------
U.S. Treasury Notes
11/15/94..... 6.000 129,500 129,559,963
11/15/94..... 8.250 94,125 94,248,774
11/15/94..... 10.125 131,060 131,319,804
11/15/94..... 11.625 117,600 117,900,682
11/30/94..... 4.625 50,000 49,993,293
12/31/94..... 4.625 124,530 124,424,534
12/31/94..... 7.625 50,000 50,194,530
--------------
697,641,580
--------------

<CAPTION>
VALUE
--------------
<S> <C> <C>
TOTAL INVESTMENTS IN SECURITIES
(Cost $1,181,879,408*)....... 98.6% $1,181,879,408
OTHER ASSETS IN EXCESS OF
LIABILITIES.................. 1.4 16,689,474
NET ASSETS (equivalent to $1.00
per share based on
1,016,866,555 Treasury Trust
and 181,971,046 Treasury
Trust Dollar shares of
beneficial interest
outstanding)................. 100.0% $1,198,568,882
NET ASSET VALUE, OFFERING
AND REDEMPTION
PRICE PER SHARE
($1,198,568,882 /
1,198,837,601).......................... $1.00
</TABLE>

- ---------------
* Cost for federal income tax purposes.

TREASURY TRUST FUND
Maturity Schedule of Portfolio
October 31, 1994

<TABLE>
<CAPTION>
MATURITY
PERIOD PAR PERCENTAGE
------------- ------------ ----------
<S> <C> <C>
1-30 Days $570,024,000 48.1%
31-60 Days 290,124,000 24.5
61-90 Days 324,530,000 27.4
</TABLE>

Average Weighted Maturity--39 days

See accompanying notes to financial statements.

FS-14
<PAGE> 75

SHORT GOVERNMENT FUND PORTFOLIO
Trust for Federal Securities
Statement of Net Assets

October 31, 1994
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
DISCOUNT RATE
OR PAR
COUPON RATE (000) VALUE
------------- ------ ----------
<S> <C> <C>
U.S. TREASURY NOTES--45.3%
01/15/95............ 8.625% $ 500 $ 503,430
11/15/95............ 8.500 450 460,147
03/31/96............ 7.750 1,000 1,016,840
10/15/98............ 7.125 250 248,675
----------
Total (Cost $2,232,735)......... 2,229,092
----------
AGENCY & INSTRUMENTALITY
OBLIGATIONS--50.7%
Federal Home Loan Bank Notes
03/27/95............ 7.875 500 504,145
05/24/99............ 7.040 500 489,145
----------
993,290
----------
Federal Home Loan Mortgage
Corporation Bonds
04/15/99............ 7.500 500 498,781
----------
Federal National Mortgage Association
Discount Notes
11/01/94............ 4.690 500 500,000
----------
Federal National Mortgage
Association Notes
06/17/99............ 6.310 500 499,256
----------
Total (Cost $2,507,467)......... 2,491,327
----------
TOTAL INVESTMENTS IN SECURITIES
(Cost $4,740,202*).................. 96.0% $4,720,419
OTHER ASSETS IN EXCESS OF
LIABILITIES......................... 4.0 197,179
NET ASSETS (Equivalent to $9.28 per
share based on 89,311 Short
Government and 440,438 Short
Government Dollar shares of
beneficial interest outstanding).... 100.0% $4,917,598
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE
($4,917,598 / 529,749).............. $9.28
</TABLE>

- ---------------
* Cost for federal income tax purposes is $4,742,541. The
aggregate unrealized depreciation for all securities is as
follows.
Excess of tax cost over value................ $(22,122)

SHORT GOVERNMENT FUND
Maturity of Portfolio
October 31, 1994

Average Weighted Maturity--2.11 years

See accompanying notes to financial statements.

FS-15
<PAGE> 76

TRUST FOR FEDERAL SECURITIES
Statements of Operations
Year Ended October 31, 1994

<TABLE>
<CAPTION>
FEDERAL TREASURY
TRUST TRUST
FEDFUND T-FUND FEDCASH T-CASH FUND FUND
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------- ----------- ----------- ----------- ----------- -----------
Investment Income:
<S> <C> <C> <C> <C> <C> <C>
Interest income......................... $53,696,867 $44,393,192 $24,458,141 $16,309,460 $11,831,680 $51,213,480
----------- ----------- ----------- ----------- ----------- -----------
Expenses:
Investment advisory fee................. 1,732,574 1,474,559 790,883 559,416 373,008 1,740,663
Administration fee...................... 1,732,574 1,474,559 790,883 559,416 373,008 1,740,663
Trustees' fees and officer's salary..... 25,608 22,025 11,807 8,384 5,505 25,983
Transfer agent fee...................... 189,439 81,291 23,192 25,305 36,244 133,142
Custodian fee........................... 220,443 202,087 130,951 100,276 71,103 220,900
Shareholder computer access program..... 37,698 32,701 6,866 5,753 3,368 36,447
Legal and audit......................... 47,627 40,760 21,841 15,461 10,272 48,086
Organization expense.................... 0 0 5,161 5,209 9,158 5,366
Registration fees and expenses.......... 21,150 10,520 19,760 19,174 20,177 20,007
Printing................................ 12,482 10,946 6,454 6,252 4,247 14,876
Other................................... 50,081 48,157 11,511 15,278 15,511 47,056
----------- ----------- ----------- ----------- ----------- -----------
4,069,676 3,397,605 1,819,309 1,319,924 921,601 4,033,189
Service Organization fees--Dollar
shares................................ 308,757 45,095 100,915 265,700 7,882 465,117
----------- ----------- ----------- ----------- ----------- -----------
4,378,433 3,442,700 1,920,224 1,585,624 929,483 4,498,306
Less fees waived........................ (1,615,628) (1,310,068) (1,093,063) (819,786) (394,224) (1,569,441)
----------- ----------- ----------- ----------- ----------- -----------
Total expenses........................ 2,762,805 2,132,632 827,161 765,838 535,259 2,928,865
----------- ----------- ----------- ----------- ----------- -----------
Net investment income................... 50,934,062 42,260,560 23,630,980 15,543,622 11,296,421 48,284,615
----------- ----------- ----------- ----------- ----------- -----------
Realized gain (loss) on investments:
Net realized gain (loss) from security
transactions.......................... (69,818) 24,931 (6,709) 10,453 (71,784) (184,663)
----------- ----------- ----------- ----------- ----------- -----------
Net increase in net assets resulting
from operations....................... $50,864,244 $42,285,491 $23,624,271 $15,554,075 $11,224,637 $48,099,952
=========== =========== =========== =========== =========== ===========
</TABLE>

See accompanying notes to financial statements.

FS-16
<PAGE> 77

TRUST FOR FEDERAL SECURITIES
Statements of Operations
Year Ended October 31, 1994

<TABLE>
<CAPTION>
SHORT
GOVERNMENT
FUND
PORTFOLIO
----------
<S> <C>
Investment Income:
Interest income....................................................................... $372,234
--------
Expenses:
Investment advisory fee............................................................... 13,299
Administration fee.................................................................... 13,299
Trustees' fees and officer's salary................................................... 166
Transfer agent fee.................................................................... 2,077
Custodian fee......................................................................... 4,376
Legal and audit....................................................................... 284
Registration fees and expenses........................................................ 17,240
Printing.............................................................................. 5,435
Other................................................................................. 726
--------
56,902
Service Organization fees--Dollar shares.............................................. 13,989
--------
70,891
Less fees waived and expenses reimbursed.............................................. (30,305)
--------
Total expenses...................................................................... 40,586
--------
Net investment income................................................................. 331,648
--------
Realized and unrealized gain (loss) on investments:
Net realized loss from security transactions.......................................... (132,747)
Change in unrealized appreciation of investments...................................... (226,735)
--------
Net loss on investments............................................................... (359,482)
--------
Net decrease in net assets resulting from operations.................................. $(27,834)
========
</TABLE>

See accompanying notes to financial statements.

FS-17
<PAGE> 78

TRUST FOR FEDERAL SECURITIES
Statements of Changes in Net Assets

<TABLE>
<CAPTION>
FEDFUND PORTFOLIO T-FUND PORTFOLIO
----------------------------------- -----------------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
OCTOBER 31, 1994 OCTOBER 31, 1993 OCTOBER 31, 1994 OCTOBER 31, 1993
---------------- ---------------- ---------------- ----------------
<S> <C> <C> <C> <C>
Increase (decrease) in net assets:
Operations:
Net investment income............................ $ 50,934,062 $ 53,299,898 $ 42,260,560 $ 39,730,518
Net gain (loss) on investments................... (69,818) (93,978) 24,931 (81,841)
---------------- ---------------- ---------------- ----------------
Net increase in net assets resulting from
operations..................................... 50,864,244 53,205,920 42,285,491 39,648,677
---------------- ---------------- ---------------- ----------------
Distributions to shareholders:
From net investment income:
FedFund shares................................. (46,624,473) (49,659,695) -- --
FedFund Dollar shares.......................... (4,309,589) (3,640,203) -- --
T-Fund shares.................................. -- -- (41,643,869) (39,458,611)
T-Fund Dollar shares........................... -- -- (616,691) (271,907)
From net realized gains:
FedFund shares................................. -- (108,308) -- --
FedFund Dollar shares.......................... -- (5,798) -- --
---------------- ---------------- ---------------- ----------------
Total distributions to shareholders.......... (50,934,062) (53,414,004) (42,260,560) (39,730,518)
---------------- ---------------- ---------------- ----------------
Capital share transactions (at $1 per share):
Sale of shares................................... 20,324,163,439 23,526,843,983 10,514,363,640 11,562,455,722
Reinvestment of dividends........................ 9,062,973 9,248,522 8,945,390 7,831,656
Repurchase of shares............................. (20,100,673,406) (25,200,353,376) (10,863,024,585) (11,528,001,611)
---------------- ---------------- ---------------- ----------------
Increase (decrease) in net assets derived from
capital share transactions..................... 232,553,006 (1,664,260,871) (339,715,555) 42,285,767
---------------- ---------------- ---------------- ----------------
Total increase (decrease) in net assets...... 232,483,188 (1,664,468,955) (339,690,624) 42,203,926
Net assets:
Beginning of period................................ 1,460,848,309 3,125,317,264 1,374,862,286 1,332,658,360
---------------- ---------------- ---------------- ----------------
End of period...................................... $ 1,693,331,497 $ 1,460,848,309 $ 1,035,171,662 $ 1,374,862,286
================ ================ ================ ================
</TABLE>

See accompanying notes to financial statements.

FS-18

<PAGE> 79

TRUST FOR FEDERAL SECURITIES
Statements of Changes in Net Assets

<TABLE>
<CAPTION>
FEDCASH T-CASH
PORTFOLIO PORTFOLIO
----------------------------------- -----------------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
OCTOBER 31, 1994 OCTOBER 31, 1993 OCTOBER 31, 1994 OCTOBER 31, 1993
---------------- ---------------- ---------------- ----------------
Increase (decrease) in net assets:
<S> <C> <C> <C> <C>
Operations:
Net investment income............................ $ 23,630,980 $ 16,488,878 $ 15,543,622 16,927,589
Net gain (loss) on investments................... (6,709) (50,874) 10,453 (13,563)
--------------- --------------- --------------- ---------------
Net increase in net assets resulting from
operations..................................... 23,624,271 16,438,004 15,554,075 16,914,026
--------------- --------------- --------------- ---------------
Distributions to shareholders:
From net investment income:
FedCash shares................................. (22,236,307) (14,559,669) -- --
FedCash Dollar shares.......................... (1,394,673) (1,929,209) -- --
T-Cash shares.................................. -- -- (11,980,470) (15,024,913)
T-Cash Dollar shares........................... -- -- (3,563,152) (1,902,676)
From net realized gains:
FedCash shares................................. -- (11,761) -- --
FedCash Dollar shares.......................... -- (1,386) -- --
--------------- --------------- --------------- ---------------
Total distributions to shareholders.......... (23,630,980) (16,502,025) (15,543,622) (16,927,589)
--------------- --------------- --------------- ---------------
Capital share transactions (at $1 per share):
Sale of shares................................... 6,586,200,619 6,515,247,570 3,494,135,508 4,034,594,005
Reinvestment of dividends........................ 8,312,109 4,679,113 3,229,181 3,036,140
Repurchase of shares............................. (6,449,348,793) (6,784,877,551) (3,775,988,923) (3,953,659,674)
--------------- --------------- --------------- ---------------
Increase (decrease) in net assets derived from
capital share transactions..................... 145,163,935 (264,950,868) (278,624,234) 83,970,471
--------------- --------------- --------------- ---------------
Total increase (decrease) in net assets...... 145,157,226 (265,014,889) (278,613,781) 83,956,908
Net assets:
Beginning of period................................ 506,788,941 771,803,830 585,816,945 501,860,037
--------------- --------------- --------------- ---------------
End of period...................................... $ 651,946,167 $ 506,788,941 $ 307,203,164 $ 585,816,945
=============== =============== =============== ===============
</TABLE>

See accompanying notes to financial statements.

FS-19
<PAGE> 80

TRUST FOR FEDERAL SECURITIES
Statements of Changes in Net Assets

<TABLE>
<CAPTION>
FEDERAL TRUST TREASURY TRUST
FUND PORTFOLIO FUND PORTFOLIO
----------------------------------- -----------------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
OCTOBER 31, 1994 OCTOBER 31, 1993 OCTOBER 31, 1994 OCTOBER 31, 1993
---------------- ---------------- ---------------- ----------------
Increase (decrease) in net assets:
<S> <C> <C> <C> <C>
Operations:
Net investment income............................ $ 11,296,421 $ 11,083,277 $ 48,284,615 $ 45,181,276
Net loss on investments.......................... (71,784) (63,460) (184,663) (52,959)
---------------- ---------------- ---------------- ----------------
Net increase in net assets resulting from
operations..................................... 11,224,637 11,019,817 48,099,952 45,128,317
---------------- ---------------- ---------------- ----------------
Distributions to shareholders:
From net investment income:
Federal Trust shares........................... (11,168,689) (11,005,479) -- --
Federal Trust Dollar shares.................... (127,732) (77,798) -- --
Treasury Trust shares.......................... -- -- (42,229,885) (40,045,868)
Treasury Trust Dollar shares................... -- -- (6,054,730) (5,135,408)
From net realized gains:
Federal Trust shares........................... -- (27,793) -- --
Federal Trust Dollar shares.................... -- (161) -- --
Treasury Trust shares.......................... -- -- (6,557) (3,989)
Treasury Trust Dollar shares................... -- -- (1,220) (515)
---------------- ---------------- ---------------- ----------------
Total distributions to shareholders.......... (11,296,421) (11,111,231) (48,292,392) (45,185,780)
---------------- ---------------- ---------------- ----------------
Capital share transactions (at $1 per share):
Sale of shares................................... 3,224,796,906 3,003,073,377 7,688,786,462 9,302,817,012
Reinvestment of dividends........................ 2,840,411 1,433,506 11,595,449 12,237,109
Repurchase of shares............................. (3,159,667,718) (3,177,072,598) (7,948,238,689) (9,638,888,666)
---------------- ---------------- ---------------- ----------------
Increase (decrease) in net assets derived from
capital share transactions..................... 67,969,599 (172,565,715) (247,856,778) (323,834,545)
---------------- ---------------- ---------------- ----------------
Total increase (decrease) in net assets...... 67,897,815 (172,657,129) (248,049,218) (323,892,008)
Net assets:
Beginning of period.............................. 258,149,620 430,806,749 1,446,618,100 1,770,510,108
---------------- ---------------- ---------------- ----------------
End of period.................................... $ 326,047,435 $ 258,149,620 $ 1,198,568,882 $ 1,446,618,100
================ ================ ================ ================
</TABLE>

See accompanying notes to financial statements.

FS-20
<PAGE> 81

TRUST FOR FEDERAL SECURITIES
Statements of Changes in Net Assets

<TABLE>
<CAPTION>
SHORT
GOVERNMENT
FUND PORTFOLIO
-----------------------------------
YEAR ENDED YEAR ENDED
OCTOBER 31, 1994 OCTOBER 31, 1993
---------------- ----------------
<S> <C> <C>
Increase (decrease) in net assets:
Operations:
Net investment income................................................................... $ 331,648 $ 459,809
Net gain (loss) on investments.......................................................... (359,482) 122,130
---------------- ----------------
Net increase (decrease) in net assets resulting from operations......................... (27,834) 581,939
---------------- ----------------
Distributions to shareholders:
From net investment income:
Short Government shares............................................................... (55,662) (243,699)
Short Government Dollar shares........................................................ (275,986) (216,110)
From net realized gains:
Short Government shares............................................................... (67,302) --
Short Government Dollar shares........................................................ (359,354) --
---------------- ----------------
Total distributions to shareholders................................................. (758,304) (459,809)
---------------- ----------------
Capital share transactions:
Sale of shares.......................................................................... 22,233,001 17,945,163
Reinvestment of dividends............................................................... 70,596 302
Repurchase of shares.................................................................... (22,716,105) (25,605,174)
---------------- ----------------
Decrease in net assets derived from capital share transactions.......................... (412,508) (7,659,709)
---------------- ----------------
Total decrease in net assets........................................................ (1,198,646) (7,537,579)
Net assets:
Beginning of period....................................................................... 6,116,244 13,653,823
---------------- ----------------
End of period............................................................................. $ 4,917,598 $ 6,116,244
================ ================
</TABLE>

See accompanying notes to financial statements.

FS-21
<PAGE> 82

TRUST FOR FEDERAL SECURITIES
Financial Highlights
(For a Share Outstanding Throughout Each Period)

<TABLE>
<CAPTION>
FEDFUND SHARES
--------------------------------------------------------------
YEAR ENDED OCTOBER 31,
--------------------------------------------------------------
1994 1993 1992 1991 1990
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period............... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- ---------- ---------- ---------- ----------
Income From Investment Operations:
Net Investment Income............................ .0377 .0308 .0397 .0637 .0800
Net Capital Gains................................ -- .0001 .0010 -- --
---------- ---------- ---------- ---------- ----------
Total From Investment Operations............... .0377 .0309 .0407 .0637 .0800
---------- ---------- ---------- ---------- ----------
Less Distributions:
Dividends to Shareholders from:
Net Investment Income............................ (.0377) (.0308) (.0397) (.0637) (.0800)
Net Capital Gains................................ -- (.0001) (.0010) -- --
---------- ---------- ---------- ---------- ----------
Total Distributions............................ (.0377) (.0309) (.0407) (.0637) (.0800)
---------- ---------- ---------- ---------- ----------
Net Asset Value, End of Period..................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
========== ========== ========== ========== ==========
Total Return....................................... 3.84% 3.12% 4.15% 6.56% 8.29%
Ratios/Supplemental Data:
Net Assets, End of Period $(000)................... $1,557,562 $1,290,971 $2,976,954 $1,918,966 $1,488,141
Ratios of Expenses to Average Net Assets........... .18%(1) .20%(1) .27% .30% .30%(1)
Ratios of Net Investment Income to
Average Net Assets............................... 3.76% 3.08% 3.91% 6.36% 8.00%
</TABLE>

<TABLE>
<CAPTION>
FEDFUND DOLLAR SHARES
--------------------------------------------------
YEAR ENDED OCTOBER 31,
--------------------------------------------------
1994 1993 1992 1991 1990
-------- -------- -------- ------- -------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period............... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- ------- -------
Income From Investment Operations:
Net Investment Income............................ .0352 .0283 .0372 .0612 .0775
Net Capital Gains................................ -- .0001 .0010 -- --
-------- -------- -------- ------- -------
Total From Investment Operations............... .0352 .0284 .0382 .0612 .0775
-------- -------- -------- ------- -------
Less Distributions:
Dividends to Shareholders from:
Net Investment Income............................ (.0352) (.0283) (.0372) (.0612) (.0775)
Net Capital Gains................................ -- (.0001) (.0010) -- --
-------- -------- -------- ------- -------
Total Distributions............................ (.0352) (.0284) (.0382) (.0612) (.0775)
-------- -------- -------- ------- -------
Net Asset Value, End of Period..................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
========= ========= ========= ======== ========
Total Return....................................... 3.59% 2.87% 3.90% 6.31% 8.04%
Ratios/Supplemental Data:
Net Assets, End of Period $(000)................... $135,769 $169,877 $148,363 $62,842 $19,815
Ratios of Expenses to Average Net Assets........... .43%(1) .45%(1) .52% .55% .55%(1)
Ratios of Net Investment Income to
Average Net Assets............................... 3.51% 2.83% 3.66% 6.11% 7.75%
</TABLE>

- ---------------
(1) Without the waiver of advisory and administration fees, the ratio of
expenses to average daily net assets would have been .30%, .27% and .34%
for the years ended October 31, 1994, 1993 and 1990, respectively, for
FedFund shares and .55%, .52% and .59%, for the years ended October 31,
1994, 1993 and 1990, respectively, for FedFund Dollar shares.

See accompanying notes to financial statements.

FS-22
<PAGE> 83

TRUST FOR FEDERAL SECURITIES
Financial Highlights
(For a Share Outstanding Throughout Each Period)

<TABLE>
<CAPTION>
T-FUND SHARES
--------------------------------------------------------------
YEAR ENDED OCTOBER 31,
--------------------------------------------------------------
1994 1993 1992 1991 1990
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period.................. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- ---------- ---------- ---------- ----------
Income From Investment Operations:
Net Investment Income............................... .0368 .0303 .0392 .0626 .0799
---------- ---------- ---------- ---------- ----------
Total From Investment Operations.................. .0368 .0303 .0392 .0626 .0799
---------- ---------- ---------- ---------- ----------
Less Distributions:
Dividends to Shareholders from:
Net Investment Income............................... (.0368) (.0303) (.0392) (.0626) (.0799)
---------- ---------- ---------- ---------- ----------
Total Distributions............................... (.0368) (.0303) (.0392) (.0626) (.0799)
---------- ---------- ---------- ---------- ----------
Net Asset Value, End of Period........................ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
========== ========== ========== ========== ==========
Total Return.......................................... 3.75% 3.07% 3.99% 6.44% 8.29%
Ratios/Supplemental Data:
Net Assets, End of Period $(000)...................... $1,035,172 $1,361,624 $1,327,743 $1,592,750 $1,497,476
Ratios of Expenses to Average Net Assets.............. .18%(1) .20%(1) .28% .30% .30%(1)
Ratios of Net Investment Income to
Average Net Assets.................................. 3.65% 3.03% 3.93% 6.26% 7.99%
</TABLE>

<TABLE>
<CAPTION>
T-FUND DOLLAR SHARES
-------------------------------------------------
YEAR ENDED OCTOBER 31,
-------------------------------------------------
1994 1993 1992 1991 1990
-------- -------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period.................. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- ------- ------- -------
Income From Investment Operations:
Net Investment Income............................... .0343 .0278 .0367 .0601 .0774
-------- -------- ------- ------- -------
Total From Investment Operations.................. .0343 .0278 .0367 .0601 .0774
-------- -------- ------- ------- -------
Less Distributions:
Dividends to Shareholders from:
Net Investment Income............................... (.0343) (.0278) (.0367) (.0601) (.0774)
-------- -------- ------- ------- -------
Total Distributions............................... (.0343) (.0278) (.0367) (.0601) (.0774)
-------- -------- ------- ------- -------
Net Asset Value, End of Period........................ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
========= ========= ======== ======== ========
Total Return.......................................... 3.50% 2.82% 3.74% 6.19% 8.04%
Ratios/Supplemental Data:
Net Assets, End of Period $(000)...................... $22,195 $13,328 $ 4,915 $40,372 $27,116
Ratios of Expenses to Average Net Assets.............. .43%(1) .45%(1) .53% .55% .55%(1)
Ratios of Net Investment Income to
Average Net Assets.................................. 3.40% 2.78% 3.68% 6.01% 7.74%
</TABLE>

- ---------------
(1) Without the waiver of advisory and administration fees, the ratios of
expenses to average daily net assets would have been .29%, .28% and .34%,
respectively, for each of the years ended October 31, 1994, 1993 and 1990
for T-Fund Shares and .54%, .53% and .59%, respectively, for each of the
years ended October 31, 1994, 1993 and 1990 for T-Fund Dollar shares.

See accompanying notes to financial statements.

FS-23
<PAGE> 84

TRUST FOR FEDERAL SECURITIES
Financial Highlights
(For a Share Outstanding Throughout Each Period)
<TABLE>
<CAPTION>
FEDCASH DOLLAR
FEDCASH SHARES SHARES
------------------------------------------------------ --------------
MAY 21,
1991(3)
YEAR ENDED YEAR ENDED YEAR ENDED TO YEAR ENDED
OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31,
1994 1993 1992 1991 1994
------------ ------------ ------------ ------------ --------------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period....... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------------ ------------ ------------ ------------ -------
Income From Investment Operations:
Net Investment Income..................... .0382 .0316 .0433 .0266 .0357
Net Capital Gains......................... -- -- .0012 -- --
------------ ------------ ------------ ------------ -------
Total From Investment Operations........ .0382 .0316 .0445 .0266 .0357
------------ ------------ ------------ ------------ -------
Less Distributions:
Dividends to Shareholders from:
Net Investment Income..................... (.0382) (.0316) (.0433) (.0266) (.0357)
Net Capital Gains......................... -- -- (.0012) -- --
------------ ------------ ------------ ------------ -------
Total Distributions..................... (.0382) (.0316) (.0445) (.0266) (.0357)
------------ ------------ ------------ ------------ -------
Net Asset Value, End of Period............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
============ ============ ============ ============ =============
Total Return............................... 3.89% 3.20% 4.54% 2.69% 3.64%
Ratios/Supplemental Data:
Net Assets, End of Period $(000)........... $629,209 $447,942 $717,978 $290,558 $ 22,737
Ratios of Expenses to Average Net
Assets(1)................................. .12% .10% .07% .00%(2) .37%
Ratios of Net Investment Income to
Average Net Assets........................ 3.80% 3.16% 3.99% 5.80%(2) 3.55%

FEDCASH DOLLAR
SHARES
----------------------------------
DECEMBER 13,
1991(4)
YEAR ENDED TO
OCTOBER 31, OCTOBER 31,
1993 1992
-------------- ------------------
<S> <C> <C>
Net Asset Value, Beginning of Period....... $ 1.00 $ 1.00
------- -------
Income From Investment Operations:
Net Investment Income..................... .0291 .0349
Net Capital Gains......................... -- .0012
------- -------
Total From Investment Operations........ .0291 .0361
------- -------
Less Distributions:
Dividends to Shareholders from:
Net Investment Income..................... (.0291) (.0349)
Net Capital Gains......................... -- (.0012)
------- -------
Total Distributions..................... (.0291) (.0361)
------- -------
Net Asset Value, End of Period............. $ 1.00 $ 1.00
========= =========
Total Return............................... 2.95% 3.67%
Ratios/Supplemental Data:
Net Assets, End of Period $(000)........... $ 58,847 $ 53,813
Ratios of Expenses to Average Net
Assets(1)................................. .35% .32%(2)
Ratios of Net Investment Income to
Average Net Assets........................ 2.91% 3.66%(2)
</TABLE>

- ---------------
(1) Without the waiver of advisory and administration fees and without expense
reimbursements, the ratio of expenses to average daily net assets for
FedCash shares would have been .29%, .28% and .29%, respectively, for each
of the years ended October 31, 1994, 1993 and 1992, and .39% (annualized)
for the period ended October 31, 1991, and for FedCash Dollar shares would
have been .54% and .53%, respectively for each of years ended October 31,
1994, 1993 and .54% (annualized) for the period ended October 31, 1992.
(2) Annualized.
(3) Commencement of operations.
(4) First issuance of shares.

See accompanying notes to financial statements.

FS-24
<PAGE> 85

TRUST FOR FEDERAL SECURITIES
Financial Highlights
(For a Share Outstanding Throughout Each Period)
<TABLE>
<CAPTION>
T-CASH DOLLAR
T-CASH SHARES SHARES
----------------------------------------------------------- --------------
JUNE 5,
1991(3)
YEAR ENDED YEAR ENDED YEAR ENDED TO YEAR ENDED
OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31,
1994 1993 1992 1991 1994
------------- ------------- ------------- ------------- --------------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period....... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------------- ------------- ------------- ------------- -------
Income From Investment Operations:
Net Investment Income..................... .0371 .0311 .0406 .0235 .0346
------------- ------------- ------------- ------------- -------
Total From Investment Operations........ .0371 .0311 .0406 .0235 .0346
------------- ------------- ------------- ------------- -------
Less Distributions:
Dividends to Shareholders from:
Net Investment Income..................... (.0371) (.0311) (.0406) (.0235) (.0346)
------------- ------------- ------------- ------------- -------
Total Distributions..................... (.0371) (.0311) (.0406) (.0235) (.0346)
------------- ------------- ------------- ------------- -------
Net Asset Value, End of Period............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
============= ============= ============= ============= ============
Total Return............................... 3.77% 3.15% 4.13% 2.38% 3.52%
Ratios/Supplemental Data:
Net Assets, End of Period $(000)........... $217,910 $424,641 $477,599 $301,526 $ 82,293
Ratios of Expenses to Average Net
Assets(1)................................. .11% .10% .06% .00%(2) .36%
Ratios of Net Investment Income to
Average Net Assets........................ 3.58% 3.11% 3.99% 5.70%(2) 3.33%

T-CASH DOLLAR
SHARES
----------------------------------
AUGUST 4,
1992(4)
YEAR ENDED TO
OCTOBER 31, OCTOBER 31,
1993 1992
-------------- ------------------
<S> <C> <C>
Net Asset Value, Beginning of Period....... $ 1.00 $ 1.00
------------- -------
Income From Investment Operations:
Net Investment Income..................... .0286 .0080
------------- -------
Total From Investment Operations........ .0286 .0080
------------- -------
Less Distributions:
Dividends to Shareholders from:
Net Investment Income..................... (.0286) (.0080)
------------- -------
Total Distributions..................... (.0286) (.0080)
------------- -------
Net Asset Value, End of Period............. $ 1.00 $ 1.00
============= ===============
Total Return............................... 2.90% .76%
Ratios/Supplemental Data:
Net Assets, End of Period $(000)........... $161,176 $ 24,261
Ratios of Expenses to Average Net
Assets(1)................................... .35% .35%(2)
Ratios of Net Investment Income to
Average Net Assets........................ 2.86% 3.03%(2)
</TABLE>

- ---------------
(1) Without the waiver of advisory and administration fees and without expense
reimbursements, the ratio of expenses to average daily net assets for T-Cash
shares would have been .30%, .29% and .29%, respectively, for each of the
years ended October 31, 1994, 1993 and 1992, and .37% (annualized) for the
period ended October 31, 1991, and for T-Cash Dollar shares would have been
.55% and .54% for the years ended October 31, 1994, 1993 and .58%
(annualized) for the period ended October 31, 1992.
(2) Annualized.
(3) Commencement of operations.
(4) First issuance of shares.

See accompanying notes to financial statements.

FS-25
<PAGE> 86

TRUST FOR FEDERAL SECURITIES
Financial Highlights
(For a Share Outstanding Throughout Each Period)

<TABLE>
<CAPTION>
FEDERAL TRUST SHARES FEDERAL TRUST DOLLAR SHARES
-------------------------------------------------- ---------------------------------------------------
DECEMBER 3, DECEMBER 31,
1990(3) 1990(4)
YEAR ENDED YEAR ENDED YEAR ENDED TO YEAR ENDED YEAR ENDED YEAR ENDED TO
OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31,
1994 1993 1992 1991 1994 1993 1992 1991
----------- ----------- ----------- ----------- ----------- ----------- ----------- ------------
Net Asset Value,
Beginning of
Period............... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
<S> <C> <C> <C> <C> <C> <C> <C> <C>
----------- ----------- ----------- ----------- ----------- ----------- ----------- ------------
Income From Investment
Operations:
Net Investment
Income............. .0380 .0302 .0389 .0564 .0355 .0277 .0364 .0487
Net Capital Gains.... -- .0001 .0018 -- -- .0001 .0018 --
----------- ----------- ----------- ----------- ----------- ----------- ----------- ------------
Total From Investment
Operations......... .0380 .0303 .0407 .0564 .0355 .0278 .0382 .0487
----------- ----------- ----------- ----------- ----------- ----------- ----------- ------------
Less Distributions:
Dividends to
Shareholders from:
Net Investment
Income............... (.0380) (.0302) (.0389) (.0564) (.0355) (.0277) (.0364) (.0487)
Net Capital Gains.... -- (.0001) (.0018) -- -- (.0001) (.0018) --
----------- ----------- ----------- ----------- ----------- ----------- ----------- ------------
Total
Distributions.... (.0380) (.0303) (.0407) (.0564) (.0355) (.0278) (.0382) (.0487)
----------- ----------- ----------- ----------- ----------- ----------- ----------- ------------
Net Asset Value, End
of Period............ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
=========== =========== =========== ============ =========== =========== =========== =============
Total Return.......... 3.87% 3.06% 4.15% 5.79% 3.62% 2.81% 3.90% 4.98%
Ratios/Supplemental
Data:
Net Assets, End of
Period $(000)........ $ 317,769 $ 257,125 $ 428,365 $ 184,063 $ 8,278 $ 1,025 $ 2,442 $ 1,681
Ratios of Expenses to
Average Net
Assets(1)............ .18% .18% .20% .12%(2) .43% .43% .45% .37%(2)
Ratios of Net
Investment Income to
Average Net Assets... 3.85% 3.02% 3.75% 5.93%(2) 3.60% 2.77% 3.50% 5.86%(2)
</TABLE>

- ---------------
(1) Without the waiver of advisory and administration fees and without expense
reimbursements, the ratios of expenses to average daily net assets would
have been .31%, .29% and .30%, respectively, for each of the years ended
October 31, 1994, 1993 and 1992 and .39% (annualized) for the period ended
October 31, 1991 for Federal Trust shares, and .56%, .54% and .55%,
respectively, for each of the years ended October 31, 1994, 1993 and 1992,
and .64% (annualized) for the period ended October 31, 1991 fo Federal
Trust Dollar shares.
(2) Annualized.
(3) Commencement of operations.
(4) First issuance of shares.

See accompanying notes to financial statements.

FS-26
<PAGE> 87

TRUST FOR FEDERAL SECURITIES
Financial Highlights
(For a Share Outstanding Throughout Each Period)
<TABLE>
<CAPTION>
TREASURY
TRUST
DOLLAR
SHARES
--------
TREASURY TRUST SHARES YEAR
---------------------------------------------------------------- ENDED
OCTOBER
YEAR ENDED OCTOBER 31, 31,
---------------------------------------------------------------- --------
1994 1993 1992 1991 1990 1994
---------- ---------- ---------- ---------- -------- --------
Net Asset Value, Beginning of Period........ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
<S> <C> <C> <C> <C> <C> <C>
---------- ---------- ---------- ---------- -------- --------
Income From Investment Operations:
Net Investment Income...................... .0359 .0292 .0380 .0612 .0777 .0334
---------- ---------- ---------- ---------- -------- --------
Total From Investment Operations......... .0359 .0292 .0380 .0612 .0777 .0334
---------- ---------- ---------- ---------- -------- --------
Less Distributions:
Dividends to Shareholders from:
Net Investment Income...................... (.0359) (.0292) (.0380) (.0612) (.0777) (.0334)
---------- ---------- ---------- ---------- -------- --------
Total Distributions...................... (.0359) (.0292) (.0380) (.0612) (.0777) (.0334)
---------- ---------- ---------- ---------- -------- --------
Net Asset Value, End of Period.............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
========== ========== ========== ========== ======== ========
Total Return................................ 3.65% 2.96% 3.85% 6.30% 8.05% 3.40%
Ratios/Supplemental Data:
Net Assets, End of Period $(000)............ $1,016,635 $1,188,412 $1,552,207 $1,275,545 $692,404 $181,934
Ratios of Expenses to
Average Net Assets(1)...................... .18% .18% .20% .20% .20% .43%
Ratios of Net Investment Income to
Average Net Assets......................... 3.57% 2.92% 3.78% 6.00% 7.74% 3.32%

<CAPTION>
TREASURY TRUST DOLLAR SHARES
------------------------------------------
YEAR ENDED OCTOBER 31,
------------------------------------------
1993 1992 1991 1990
-------- -------- ------- -------
<S> <C> <C> <C> <C>
Net Asset Value, Beginning of Period........ $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- ------- -------
Income From Investment Operations:
Net Investment Income...................... .0267 .0355 .0587 .0752
-------- -------- ------- -------
Total From Investment Operations......... .0267 .0355 .0587 .0752
-------- -------- ------- -------
Less Distributions:
Dividends to Shareholders from:
Net Investment Income...................... (.0267) (.0355) (.0587) (.0752)
-------- -------- ------- -------
Total Distributions...................... (.0267) (.0355) (.0587) (.0752)
-------- -------- ------- -------
Net Asset Value, End of Period.............. $ 1.00 $ 1.00 $ 1.00 $ 1.00
======== ======== ======= =======
Total Return................................ 2.71% 3.60% 6.05% 7.80%
Ratios/Supplemental Data:
Net Assets, End of Period $(000)............ $258,206 $218,320 $50,729 $61,270
Ratios of Expenses to
Average Net Assets(1)...................... .43% .45% .45% .45%
Ratios of Net Investment Income to
Average Net Assets......................... 2.67% 3.53% 5.75% 7.49%
</TABLE>

- ---------------
(1) Without the waiver of advisory and administration fees, the ratio of
expenses to average daily net assets would have been .29%, .28%, .27%,
.32% and .37%, respectively, for each of the years ended October 31, 1994,
1993, 1992, 1991 and 1990, for Treasury Trust shares, and .54%, .53%, .52%,
.57% and .62%, respectively, for each of the years ended October 31, 1994,
1993, 1992, 1991 and 1990 for Treasury Trust Dollar shares.

See accompanying notes to financial statements.

FS-27
<PAGE> 88

TRUST FOR FEDERAL SECURITIES
Financial Highlights
(For a Share Outstanding Throughout Each Period)
<TABLE>
<CAPTION>
SHORT
GOVERNMENT
DOLLAR
SHARES
YEAR
ENDED
SHORT GOVERNMENT SHARES OCTOBER
YEAR ENDED OCTOBER 31, 31,
------------------------------------------------------- --------
1994 1993 1992 1991 1990 1994
------- ------- ------- ------- ------- --------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period............. $ 10.47 $ 10.39 $ 10.24 $ 9.99 $ 9.92 $ 10.47
------- ------- ------- ------- ------- --------
Income From Investment Operations:
Net Investment Income........................... .5032 .0575 .6669 .7597 .7618 .4791
Net Realized and Unrealized Gain (Loss) on
Investments................................... (1.0813) .0800 .1500 .2500 .0700 (.6096)
------- ------- ------- ------- ------- --------
Total From Investment Operations.............. (.5781) .1375 .8169 1.0097 .8318 (.1305)
------- ------- ------- ------- ------- --------
Less Distributions:
Dividends to Shareholders from:
Net Investment Income........................... (.5032) (.0575) (.6669) (.7597) (.7618) (.4791)
Net Capital Gains............................... (.1087) -- -- -- -- (.5804)
------- ------- ------- ------- ------- --------
Total Distributions........................... (.6119) (.0575) (.6669) (.7597) (.7618) (1.0595)
------- ------- ------- ------- ------- --------
Net Asset Value, End of Period................... $ 9.28 $ 10.47 $ 10.39 $ 10.24 $ 9.99 $ 9.28
======= ======= ======= ======= ======= ========
Total Return..................................... .04% 6.46% 8.20% 10.49% 8.71% (.21%)
Ratios/Supplemental Data:
Net Assets, End of Period
$(000).......................................... $ 829 $ 1,061 $10,874 $10,530 $10,114 $ 4,089
Ratios of Expenses to Average Net Assets(1)...... .40% .40% .40% .40% .40% .65%
Ratios of Net Investment Income to
Average Net Assets.............................. 5.19% 5.65% 6.44% 7.54% 7.68% 4.94%
Portfolio turnover rate.......................... 362% 66% 27% 31% 60% 362%

<CAPTION>
SHORT GOVERNMENT DOLLAR SHARES
YEAR ENDED OCTOBER 31,
-------------------------------------------
1993 1992 1991 1990
------- ------- ------- -------
<S> <C> <C> <C> <C>
Net Asset Value, Beginning of Period............. $ 10.39 $ 10.24 $ 9.99 $ 9.92
------- ------- ------- -------
Income From Investment Operations:
Net Investment Income........................... .0549 .6410 .7387 .6521
Net Realized and Unrealized Gain (Loss) on
Investments................................... .0800 .1500 .2500 .0700
------- ------- ------- -------
Total From Investment Operations.............. .1349 .7910 .9887 .7221
------- ------- ------- -------
Less Distributions:
Dividends to Shareholders from:
Net Investment Income........................... (.0549) (.6410) (.7387) (.6521)
Net Capital Gains............................... -- -- -- --
------- ------- ------- -------
Total Distributions........................... (.0549) (.6410) (.7387) (.6521)
------- ------- ------- -------
Net Asset Value, End of Period................... $ 10.47 $ 10.39 $ 10.24 $ 9.99
======= ======= ======= =======
Total Return..................................... 6.21% 7.95% 10.24% 7.53%
Ratios/Supplemental Data:
Net Assets, End of Period
$(000).......................................... $ 5,055 $ 2,780 $ 295 $ 1
Ratios of Expenses to Average Net Assets(1)...... .65% .65% .65% .65%
Ratios of Net Investment Income to
Average Net Assets.............................. 5.40% 5.98% 7.29% 7.43%
Portfolio turnover rate.......................... 66% 27% 31% 60%
</TABLE>

- ---------------
(1) Without the waiver of advisory and administration fees and without expense
reimbursements, the ratio of expenses to average daily net assets for Short
Government shares would have been .86%, .75%, .67%, .68% and .67%
respectively, for each of the years ended October 31, 1994, 1993, 1992, 1991
and 1990. For Short Government Dollar shares, the ratio of expenses to
average daily net assets would have been 1.11%, 1.00%, .92%, .93% and .92%
respectively, for each of the years ended October 31, 1994, 1993, 1992, 1991
and 1990.

See accompanying notes to financial statements.

FS-28
<PAGE> 89

Notes to Financial Statements

A. Trust for Federal Securities (the Company) was established as a Pennsylvania
business trust under a Declaration of Trust originally dated as of May 14, 1975,
and is registered under the Investment Company Act of 1940, as amended, as a
diversified open-end management investment company. The Company consists of
seven separate portfolios, FedFund, T-Fund, FedCash, T-Cash, Federal Trust Fund,
Treasury Trust Fund and Short Government Fund. The Intermediate Government Fund
Portfolio was liquidated on October 31, 1994.

Each portfolio has two classes of shares, one class being referred to as
Dollar shares. Dollar shares and the other class of shares of each portfolio are
identical in all respects, except that Dollar shares are sold to institutions
(Service Organizations) which provide support services to their customers who
beneficially own such shares, in consideration of the Company's payment of 0.25%
(on an annualized basis) of the average daily net asset value of the Dollar
shares held by the institutions for the benefit of their customers. The Service
Organization fee is applicable only to the earnings of the respective Dollar
shares.

B. Significant accounting policies are as follows:

Security Valuation--FedFund, T-Fund, FedCash, T-Cash, Federal Trust Fund and
Treasury Trust Fund:

Portfolio securities are valued under the amortized cost method which
approximates current market value. Under this method, securities are valued at
cost when purchased and thereafter a constant proportionate amortization of any
discount or premium is recorded until maturity of the security. Regular review
and monitoring of the valuation is performed in an attempt to avoid dilution or
other unfair results to shareholders. The Company seeks to maintain the net
asset value per share of each portfolio at $1.00.

Security Valuation--Short Government Fund:

Portfolio securities for which market quotations are readily available (other
than debt securities with remaining maturities of 60 days or less) are valued at
the mean between the most recent quoted bid and asked prices provided by
investment dealers. Other securities and assets for which market quotations are
not readily available are valued at their fair value in the best judgment of PNC
Institutional Management Corporation under procedures established by and under
the supervision of the Company's Board of Trustees. Debt securities with
remaining maturities of 60 days or less are valued on an amortized cost basis
(unless the Board determines that such basis does not represent fair value at
the time).

Repurchase Agreements--The Company may purchase, for any portfolio except
Federal Trust Fund and Treasury Trust Fund, money market instruments from
financial institutions, such as banks and non-bank dealers, subject to the
seller's agreement to repurchase them at an agreed upon date and price.
Collateral for repurchase agreements may have longer maturities than the maximum
permissible remaining maturity of portfolio investments, provided the repurchase
agreements themselves mature in one year or less. The seller will be required on
a daily basis to maintain the value of the securities subject to the agreement
at no less than the repurchase price. Repurchase agreements with maturities in
excess of seven days are subject to a seven day put feature.

Dividends to Shareholders--Dividends are declared daily and paid monthly.
Dividends payable are recorded on the dividend record date. Net income for
dividend purposes includes interest accrued and discount earned, less the
amortization of market premium and applicable expenses and, for the Money Market
Portfolios, includes net realized gains on portfolio securities. Short
Government Fund will distribute net realized capital gains, if any, at least
once a year.

FS-29
<PAGE> 90

Notes to Financial Statements (Continued)

Federal Taxes--No provision is made for federal taxes as it is the Company's
intention to have each portfolio continue to qualify as a regulated investment
company and to make the requisite distributions to its shareholders which will
be sufficient to relieve it from federal income and excise taxes.

Other--Investment transactions are accounted for on the trade date and the
cost of investments sold is determined by use of the specific identification
method for both financial reporting and income tax purposes. Expenses not
directly attributable to a specific portfolio are allocated among the portfolios
based on their relative net assets.

Costs incurred by FedCash, T-Cash, Federal Trust Fund and Treasury Trust Fund
in connection with their organization, registration and the initial public
offering of shares have been deferred and are being amortized using the
straight-line method over a five-year period beginning on the date on which the
portfolios commenced their investment activities.

C. Under agreements among the Company, PNC Bank, National Association (PNC Bank)
and PNC Institutional Management Corporation (PIMC), a wholly owned subsidiary
of PNC Bank, PIMC manages the Company's portfolios and maintains their financial
accounts. PNC Bank is the Company's sub-advisor and custodian and PFPC Inc.
(PFPC) is the Company's transfer agent.

As of January 31, 1994, Provident Distributors, Inc. (PDI) became the
Company's Distributor succeeding Pennsylvania Merchant Group Ltd. No
compensation is payable by the Company to PDI for its distribution services.

The Company has entered into an Administration Agreement with PFPC and PDI for
certain administrative services.

In return for their advisory and administrative services, the Company pays
PIMC and the administrators each a fee, computed daily and payable monthly,
based upon an annualized percentage of the average net assets of each portfolio
as follows:

FedFund, T-Fund, FedCash, T-Cash, Federal Trust Fund and Treasury Trust Fund
(on a combined basis)--.175% of the first $1 billion, .15% of the next $1
billion, .125% of the next $1 billion, .10% of the next $1 billion, .095% of the
next $1 billion, .09% of the next $1 billion, .085% of the next $1 billion and
.08% of net assets in excess of $7 billion.

Short Government Fund--.20% of average net assets.

If expenses borne by any portfolio in any fiscal year exceed the applicable
expense limitation imposed by state securities regulations, the administrators
and PIMC will each reimburse the portfolio for one-half of any excess expense up
to the amount of fees payable to it (except where such regulations require
reimbursement regardless of the fees payable to it).

The administrators and PIMC have also agreed to reduce their fees, on an equal
basis, to the extent necessary to ensure that the total operating expenses
(excluding Service Organization fees) of FedFund, T-Fund, Federal Trust Fund,
and Treasury Trust Fund do not exceed .18% of their respective average net
assets for the 36-month period ending January 18, 1996, and with respect to
FedCash and T-Cash, .16%. For the year ended October 31, 1994, the
administrators and PIMC voluntarily agreed to reimburse, on an equal basis, for
expenses in the amount of $4,592 with respect to Short Government Fund. For the
year ended October 31, 1994, the administrators (or former administrator) and
PIMC waived, on an equal basis, a total of $1,615,628 of the administration and
advisory fees payable to them with respect to FedFund, $1,310,068 with respect
to T-Fund, $1,093,063 with respect to FedCash, $819,786 with respect to T-Cash,
$394,224 with

FS-30
<PAGE> 91

Notes to Financial Statements (Continued)

respect to Federal Trust Fund, $1,569,441 with respect to Treasury Trust Fund
and $25,713 with respect to Short Government Fund.

D. The Company's Declaration of Trust permits the Trustees to authorize the
issuance of an unlimited number of full and fractional shares of beneficial
interest (shares) in the Company and to classify or reclassify any unissued
shares into one or more additional classes of shares.

Transactions in shares of the Company are summarized as follows:

<TABLE>
<CAPTION>
FEDFUND PORTFOLIO
------------------------------------
YEAR ENDED YEAR ENDED
OCTOBER 31, 1994 OCTOBER 31, 1993
---------------- ----------------
<S> <C> <C>
Shares sold:
FedFund...................................................... 13,216,424,487 17,262,796,478
FedFund Dollar............................................... 7,107,738,952 6,264,047,505
Shares issued in reinvestment of dividends:
FedFund...................................................... 6,637,408 7,117,459
FedFund Dollar............................................... 2,425,565 2,131,063
Shares repurchased:
FedFund...................................................... (12,956,407,780) (18,955,700,485)
FedFund Dollar............................................... (7,144,265,626) (6,244,652,891)
---------------- ----------------
Net increase (decrease) in shares......................... 232,553,006 (1,664,260,871)
Shares outstanding:
Beginning of period.......................................... 1,460,942,287 3,125,203,158
---------------- ----------------
End of period................................................ 1,693,495,293 1,460,942,287
================ ================
</TABLE>

<TABLE>
<CAPTION>
T-FUND PORTFOLIO
------------------------------------
YEAR ENDED YEAR ENDED
OCTOBER 31, 1994 OCTOBER 31, 1993
---------------- ----------------
<S> <C> <C>
Shares sold:
T-Fund....................................................... 10,373,466,042 11,464,012,656
T-Fund Dollar................................................ 140,897,598 98,443,066
Shares issued in reinvestment of dividends:
T-Fund....................................................... 8,928,181 7,800,781
T-Fund Dollar................................................ 17,209 30,875
Shares repurchased:
T-Fund....................................................... (10,731,065,139) (11,437,851,421)
T-Fund Dollar................................................ (131,959,446) (90,150,190)
---------------- ----------------
Net increase (decrease) in shares......................... (339,715,555) 42,285,767
Shares outstanding:
Beginning of period.......................................... 1,374,944,127 1,332,658,360
---------------- ----------------
End of period................................................ 1,035,228,572 1,374,944,127
================ ================
</TABLE>

FS-31
<PAGE> 92

Notes to Financial Statements (Continued)

<TABLE>
<CAPTION>
FEDCASH PORTFOLIO
-----------------------------------
YEAR ENDED
YEAR ENDED OCTOBER 31,
OCTOBER 31, 1994 1993
---------------- ---------------
<S> <C> <C>
Shares sold:
FedCash........................................................ 6,271,269,784 5,028,403,933
FedCash Dollar................................................. 314,930,835 1,486,843,637
Shares issued in reinvestment of dividends:
FedCash........................................................ 8,312,109 4,679,113
FedCash Dollar................................................. -- --
Shares repurchased:
FedCash........................................................ (6,098,307,231) (5,303,074,017)
FedCash Dollar................................................. (351,041,562) (1,481,803,534)
---------------- ---------------
Net increase (decrease) in shares........................... 145,163,935 (264,950,868)
Shares outstanding:
Beginning of period............................................ 506,839,815 771,790,683
---------------- ---------------
End of period.................................................. 652,003,750 506,839,815
=============== ===============
</TABLE>

<TABLE>
<CAPTION>
T-CASH PORTFOLIO
-----------------------------------
YEAR ENDED
YEAR ENDED OCTOBER 31,
OCTOBER 31, 1994 1993
---------------- ---------------
<S> <C> <C>
Shares sold:
T-Cash......................................................... 3,078,794,751 3,409,340,772
T-Cash Dollar.................................................. 415,340,757 625,253,233
Shares issued in reinvestment of dividends:
T-Cash......................................................... 2,866,836 2,974,150
T-Cash Dollar.................................................. 362,345 61,990
Shares repurchased:
T-Cash......................................................... (3,288,400,674) (3,465,260,073)
T-Cash Dollar.................................................. (487,588,249) (488,399,601)
---------------- ---------------
Net increase (decrease) in shares........................... (278,624,234) 83,970,471
Shares outstanding:
Beginning of period............................................ 585,830,508 501,860,037
---------------- ---------------
End of period.................................................. 307,206,274 585,830,508
=============== ===============
</TABLE>

FS-32
<PAGE> 93

Notes to Financial Statements (Continued)

<TABLE>
<CAPTION>
FEDERAL TRUST FUND PORTFOLIO
------------------------------------
YEAR ENDED YEAR ENDED
OCTOBER 31, 1994 OCTOBER 31, 1993
---------------- ----------------
<S> <C> <C>
Shares sold:
Federal Trust.................................................. 3,188,210,343 3,002,371,176
Federal Trust Dollar........................................... 36,586,563 702,201
Shares issued in reinvestment of dividends:
Federal Trust.................................................. 2,838,942 1,427,201
Federal Trust Dollar........................................... 1,469 6,305
Shares repurchased:
Federal Trust.................................................. (3,130,334,569) (3,174,947,516)
Federal Trust Dollar........................................... (29,333,149) (2,125,082)
---------------- ----------------
Net increase (decrease) in shares........................... 67,969,599 (172,565,715)
Shares outstanding:
Beginning of period............................................ 258,238,416 430,804,131
---------------- ----------------
End of period.................................................. 326,208,015 258,238,416
=============== ===============
</TABLE>

<TABLE>
<CAPTION>
TREASURY TRUST FUND PORTFOLIO
------------------------------------
YEAR ENDED YEAR ENDED
OCTOBER 31, 1994 OCTOBER 31, 1993
---------------- ----------------
<S> <C> <C>
Shares sold:
Treasury Trust................................................. 7,214,439,647 8,777,768,209
Treasury Trust Dollar.......................................... 474,346,815 525,048,803
Shares issued in reinvestment of dividends:
Treasury Trust................................................. 7,153,403 7,969,643
Treasury Trust Dollar.......................................... 4,442,046 4,267,466
Shares repurchased:
Treasury Trust................................................. (7,393,205,005) (9,149,466,425)
Treasury Trust Dollar.......................................... (555,033,684) (489,422,241)
---------------- ----------------
Net decrease in shares...................................... (247,856,778) (323,834,545)
Shares outstanding:
Beginning of period............................................ 1,446,694,379 1,770,528,924
---------------- ----------------
End of period.................................................. 1,198,837,601 1,446,694,379
=============== ===============
</TABLE>

FS-33
<PAGE> 94

Notes to Financial Statements (Continued)

<TABLE>
<CAPTION>
SHORT GOVERNMENT
FUND PORTFOLIO
------------------------------------
YEAR ENDED YEAR ENDED
OCTOBER 31, 1994 OCTOBER 31, 1993
---------------- ----------------
<S> <C> <C>
Shares sold:
Short Government................................................. 97,814 131,705
Short Government Dollar.......................................... 2,220,216 1,583,584
Shares issued in reinvestment of dividends:
Short Government................................................. 7,288 29
Short Government Dollar.......................................... -- --
Shares repurchased:
Short Government................................................. (117,136) (1,076,751)
Short Government Dollar.......................................... (2,262,460) (1,368,453)
--------------- ---------------
Net decrease in shares........................................ (54,278) (729,886)
Shares outstanding:
Beginning of period.............................................. 584,027 1,313,913
--------------- ---------------
End of period.................................................... 529,749 584,027
============== ==============
</TABLE>

FS-34
<PAGE> 95

Notes to Financial Statements (Concluded)

E. At October 31, 1994, net assets consisted of:

<TABLE>
<CAPTION>
FEDERAL TREASURY
TRUST TRUST SHORT
FEDFUND T-FUND FEDCASH T-CASH FUND FUND GOVERNMENT
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO FUND PORTFOLIO
-------------- -------------- ------------ ------------ ------------ -------------- --------------
<S> <C> <C> <C> <C> <C> <C> <C>
Paid-in Capital... $1,693,495,293 $1,035,228,572 $652,003,750 $307,206,274 $326,208,015 $1,198,837,601 $5,070,128
Accumulated net
realized gain
(loss) on
security
transactions.... (163,796) (56,910) (57,583) (3,110) (160,580) (268,719) (132,747)
Net unrealized
depreciation of
investments..... -- -- -- -- -- -- (19,783)
-------------- -------------- ------------ ------------ ------------ -------------- --------------
$1,693,331,497 $1,035,171,662 $651,946,167 $307,203,164 $326,047,435 $1,198,568,882 $4,917,598
============== ============== ============= ============= ============= ============== ================
</TABLE>

F. At October 31, 1994, FedFund, T-Fund, FedCash, T-Cash, Federal Trust,
Treasury Trust and Short Government Fund had capital loss carryovers amounting
to $163,796, $56,910, $57,583, $3,110, $153,217, $268,719 and $130,408
respectively, which expire in 2002. The capital loss carryovers are available to
offset possible future capital gains of the related portfolios.

FS-35
<PAGE> 96

FedCash
An Investment Portfolio Offered By
Trust for Federal Securities

<TABLE>
<S> <C>
Bellevue Park Corporate Center For purchase and redemption orders only call:
400 Bellevue Parkway 800-441-7450 (in Delaware: 302-791-5350).
Suite 100 For yield information call: 800-821-6006
Wilmington, DE 19809 (FedCash shares code: 70; FedCash Dollar
shares code: 71).
For other information call: 800-821-7432.
</TABLE>

Fund shares may not be purchased by individuals directly, but institutional
investors may purchase shares for accounts maintained by individuals. In
addition to FedCash shares, investors may purchase FedCash "Dollar" shares which
accrue daily dividends in the same manner as FedCash shares but bear all fees
payable by the Fund to institutional investors for certain services they provide
to the beneficial owners of such shares. (See "Management of the Fund--Service
Organizations.")

------------------------

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.

------------------------
February 28, 1995
<PAGE> 97

BACKGROUND AND EXPENSE INFORMATION

Two classes of shares are offered by this Prospectus: FedCash shares and
FedCash Dollar shares. Shares of each class represent equal, pro rata interests
in the Fund and accrue daily dividends in the same manner except that the Dollar
shares bear fees payable by the Fund (at the rate of .25% per annum) to
institutional investors for services they provide to the beneficial owners of
such shares. (See "Management of the Fund--Service Organizations.")

EXPENSE SUMMARY

<TABLE>
<CAPTION>
FEDCASH
FEDCASH DOLLAR
SHARES SHARES
---------- ----------
<S> <C> <C> <C> <C>
ESTIMATED ANNUAL FUND OPERATING EXPENSES
- ------------------------------------------------------------------
(as a percentage of average net assets)
Management Fees (net of waivers)............................. .04% .04%
Other Expenses............................................... .14% .39%
Administration Fees (net of waivers).................... .04% .04%
Shareholder Servicing Fees.............................. 0% .25%
Miscellaneous........................................... .10% .10%
--- ---
Total Fund Operating Expenses (net of waivers)............... .18% .43%
=== ===
</TABLE>

- ------------

<TABLE>
<CAPTION>
EXAMPLE 1 YEAR 3 YEARS 5 YEARS 10 YEARS
- -------------------------------------------------------- ------- -------- -------- ---------
<S> <C> <C> <C> <C>
You would pay the following expenses on a $1,000
investment, assuming (1) a 5% annual return and (2)
redemption at the end of each time period with respect
to the following shares:
FedCash shares: $ 2 $ 6 $ 10 $23
FedCash Dollar shares: $ 4 $ 14 $ 24 $54
</TABLE>

THE FOREGOING SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE
EXPENSES OR RATE OF RETURN. ACTUAL EXPENSES AND RATE OF RETURN MAY BE GREATER OR
LESSER THAN THOSE SHOWN.

The purpose of the foregoing table is to assist an investor in
understanding the various costs and expenses that an investor in the Fund will
bear directly or indirectly. In addition, institutional investors may charge
fees for providing shareholder administrative services in connection with their
customers' investment in FedCash Dollar shares. (For more complete descriptions
of the various costs and expenses, see "Management of the Fund" in this
Prospectus and the Statement of Additional Information and the financial
statements and related notes contained in the Statement of Additional
Information.) Absent fee waivers for the fiscal year ended October 31, 1994, the
"Total Fund Operating Expenses" for FedCash shares and FedCash Dollar shares
would have been .29% and .54%, respectively, of the average net assets of the
FedCash portfolio. The investment adviser and administrators may from time to
time waive the advisory and administration fees otherwise payable to them or may
reimburse the Fund for its operating expenses. The foregoing table reflects
expenses (net of waivers) incurred by the Fund during the fiscal year ended
October 31, 1994. These waivers may continue. The foregoing table has not been
audited by the Fund's independent accountants.

2
<PAGE> 98

FINANCIAL HIGHLIGHTS

The following financial highlights for FedCash Shares have been derived
from the financial statements of the Fund for the fiscal year ended October 31,
1994 and for each of the two preceding fiscal years, and for the fiscal period
ended October 31, 1991 (commencement of operations), and for FedCash Dollar
Shares for the fiscal years ended October 31, 1994 and 1993 and the fiscal
period ended October 31, 1992 (commencement of operations). The financial
highlights for the fiscal years set forth below have been audited by Coopers &
Lybrand L.L.P. independent accountants whose report on the financial statements
and financial highlights of the Fund is included in the Statement of Additional
Information. The tables should be read in conjunction with the financial
statements and related notes included in the Statement of Additional
Information. Further information about the performance of the Fund is available
in the annual report to shareholders, which may be obtained without charge by
calling 800-821-7432.

TRUST FOR FEDERAL SECURITIES
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)

FEDCASH SHARES

<TABLE>
<CAPTION>
MAY 21, 1991(3)
YEAR ENDED YEAR ENDED YEAR ENDED TO
OCTOBER 31, 1994 OCTOBER 31, 1993 OCTOBER 31, 1992 OCTOBER 31, 1991
---------------- ---------------- ---------------- ----------------
<S> <C> <C> <C> <C>
Net Asset Value, Beginning of Period.... $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------------- ---------------- ---------------- ----------------
Income From Investment Operations:
Net Investment Income................. .0382 .0316 .0433 .0266
Net Realized Gains on Investments..... -- -- .0012 --
---------------- ---------------- ---------------- ----------------
Total From Investment Operations...... .0382 .0316 .0445 .0266
---------------- ---------------- ---------------- ----------------
Less Distributions:
Dividends (From Net Investment
Income)............................. (.0382) (.0316) (.0433) (.0266)
Distributions (From Capital Gains).... -- -- (.0012) --
---------------- ---------------- ---------------- ----------------
Total Distributions................... (.0382) (.0316) (.0445) (.0266)
---------------- ---------------- ---------------- ----------------
Net Asset Value, End of Period.......... $ 1.00 $ 1.00 $ 1.00 $ 1.00
================ ================ ================ ================
Total Return............................ 3.89% 3.20% 4.54% 2.69%(4)
Ratios/Supplemental Data:
Net Assets, End of Period (in 000s)... $629,209 $447,942 $717,978 $290,558
Ratio of Expenses to Average
Net Assets(1)....................... .12% .10% .07% .00%(2)
Ratio of Net Investment Income to
Average Net Assets.................. 3.80% 3.16% 3.99% 5.80%(2)
</TABLE>

- ------------
(1) Without the waiver of advisory and administration fees and without expense
reimbursements, the ratio of expenses to average daily net assets for
FedCash shares would have been .29%, .28% and .29%, respectively, for each
of the years ended October 31, 1994, 1993 and 1992, and .39% (annualized)
for the period ended October 31, 1991.

(2) Annualized.

(3) Commencement of operations.

(4) Total returns are not annualized for periods of less than one year.

3
<PAGE> 99

TRUST FOR FEDERAL SECURITIES
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)

FEDCASH DOLLAR SHARES

<TABLE>
<CAPTION>
MAY 21, 1991(3)
YEAR ENDED YEAR ENDED TO
OCTOBER 31, 1994 OCTOBER 31, 1993 OCTOBER 31, 1992
---------------- ---------------- ----------------
<S> <C> <C> <C>
Net Asset Value, Beginning of Period................ $ 1.00 $ 1.00 $ 1.00
-------- -------- --------
Income From Investment Operations:
Net Investment Income............................. .0357 .0291 .0349
Net Realized Gains on Investments................. -- -- .0012
-------- -------- --------
Total From Investment Operations.................. .0357 .0291 .0361
-------- -------- --------
Less Distributions:
Dividends (From Net Investment Income)............ (.0357) (.0291) (.0349)
Distributions (From Capital Gains)................ -- -- (.0012)
-------- -------- --------
Total Distributions............................... (0.357) (.0291) (.0361)
-------- -------- --------
Net Asset Value, End of Period...................... $ 1.00 $ 1.00 $ 1.00
================ ================ ================
Total Returns....................................... 3.64% 2.95% 3.67%(4)
Ratios/Supplemental Data:
Net Assets, End of Period (in 000s)............... $ 22,737 $ 58,847 $ 53,813
Ratio of Expenses to Average Daily Net Assets1.... .37% .35% .32%2
Ratio of Net Investment Income to Average Net
Assets.......................................... 3.55% 2.91% 3.66%(2)
</TABLE>

- ------------
(1) Without the waiver of advisory and administration fees and without expense
reimbursements, the ratio of expenses to average daily net assets for
FedCash Dollar shares would have been .54% and .53%, respectively, for each
of the years ended October 31, 1994 and 1993, and .54% (annualized) for the
period ended October 31, 1992.

(2) Annualized.

(3) First issuance of shares.

(4) Total returns are not annualized for periods of less than one year.

INVESTMENT OBJECTIVE AND POLICIES

The "agencies" or "instrumentalities" of the U.S. Government the
obligations of which may be purchased by FedCash are limited to those
obligations which national banks may invest directly without limitation. The
agencies or instrumentalities which currently qualify include the Central Bank
for Cooperatives, Export-Import Bank of the United States, Federal Financing
Bank,

4
<PAGE> 100

Federal Home Loan Banks, Federal Home Loan Mortgage Corporation, Federal
National Mortgage Association, General Services Administration, Government
National Mortgage Association, Maritime Administration, Small Business
Administration and Student Loan Marketing Association. The Fund's investment
procedures set forth above are designed to permit national banks to invest in
shares of the Fund without limitation under applicable law and regulations.

5
<PAGE> 101

INVESTMENT LIMITATIONS

The Fund may not:

1. Purchase securities other than U.S. Treasury bills, notes and other
obligations issued or guaranteed by the U.S. Government, its agencies or
instrumentalities, some of which may be subject to repurchase agreements.

PURCHASE AND REDEMPTION OF SHARES

PURCHASE PROCEDURES

6
<PAGE> 102

the Fund's computer access program. Orders received before 12:00 noon, Eastern
time, for which payment has been received by PNC Bank, the Fund's custodian,
will be executed at 12:00 noon. Orders received after 12:00 noon and before 2:30
P.M., Eastern time, (or orders received earlier in the same day for which
payment has not been received by 12:00 noon) will be executed at 4:00 P.M.,
Eastern time, if payment has been received by PNC Bank by that time. Orders
received at other times, and orders for which payment has not been received by
4:00 P.M., Eastern time, will not be accepted, and notice thereof will be given
to the institution placing the order. (Payment for orders which are not received
or accepted will be returned after prompt inquiry to the sending institution.)
The Fund may in its discretion reject any order for shares.

Payment for Fund shares may be made only in federal funds or other funds
immediately available to PNC Bank. The minimum initial investment is $5,000.
Broker-dealers and other institutional investors may set a higher minimum for
their customers. There is no minimum subsequent investment.

REDEMPTION PROCEDURES

7
<PAGE> 103