Pricewaterhouse Coopers LLP
Report of Independent Accountants
To the Board of Trustees of:
BT Alex.Brown Cash Reserve Fund, Inc. - Prime Series
BT Alex.Brown Cash Reserve Fund, Inc. - Treasury Series
BT Alex.Brown Cash Reserve Fund, Inc. - Tax Free Series
Flag Investor Emerging Growth Fund, Inc.
Flag Investors Equity Partners Fund, Inc.
Flag Investors Real Estate Securities Fund, Inc.
Flag Investors Communications Fund, Inc.
Flag Investors Value Builder Fund, Inc.
Flag Investors Short Intermediate Income Fund, Inc.
Flag Investors International Fund, Inc.
We have examined management's assertion about BT Alex.Brown Cash Reserve Fund,
Inc.- Prime Series, BT Alex.Brown Cash Reserve Fund, Inc.-Treasury Series, BT
Alex. Brown Cash Reserve Fund, Inc.-Tax Free Series, Flag Investors Emerging
Growth Fund, Inc., Flag Investors Equity Partners Fund, Inc., Flag Investors
Real Estate Securities Fund, Inc., Flag Investors Communications Fund, Inc.,
Flag Investors Value Builder Fund, Inc., Flag Investors Short Intermediate
Income Fund, Inc., and Flag Investors International Fund, Inc. (The "Funds")
compliance with the requirements of subsections (b) and (c) of Rule 17F-2 under
the Investment Company Act of 1940 ("the Act") as of February 26, 1999 included
in its representation letter dated September 13, 1999. Management is responsible
for the Funds' compliance with those requirements. Our responsibility is to
express an opinion o management's assertion about the Funds' compliance based on
our examination.
Our examination was made in accordance with standards established by the
American Institute of Certified Public Accountants, and accordingly, included
examining, on a test basis, evidence about the Fund's compliance with those
requirement and performing such other procedures as we considered necessary in
the circumstances. Included among our procedures were the following tests
performed as of February 26,1999 and with respect to agreement of security
purchases and sales, for the period from October 30, 1998 (the date of our last
examination) through February 26, 1999:
<PAGE>
- - Count and inspection of all securities located in the vault of Bankers
Trust in New York;
- - Confirmation of all securities held by institutions in book entry form-The
Federal Reserve Bank of New York, The Depository Trust COmpany, CREST and
CHESS
- - Confirmed all securities record - kept at banks with whom the Custodian
and the Funds have contracted to provide sub-custodian services without
prior notice to management including Citicorp-Florida, Generale Bank
Belgium, Creditanstalt Bankyerein Austria, Barclays Bank London, Royal
Bank of Canada, Den Danske Bank Denmark, Merita Bank Finland, Banque
Paribas France, Dresdner Bank Germany, National Bank of Greece, Deutsche
Bank India, Standard Charter Bank Indonesia, Allied Irish Bank Ireland,
Standard Charter Bank Hong Kong, Citibank Italy, Sumitomo Bank Tokyo,
Standard Charter Bank Korea, Custodian & Nominees Malaysia, Bancomer
Mexico, ABN AMRO Netherlands, ANZ Nominees Limited, New Zealand, Euroclear
Belgium, Standard Charter Bank Pakistan, Standard Charter Bank Manila,
Banco Espirito Portugal, United Overseas Bank Singapore, Banco Santander
Spain, Svenska Handelsbanken Sweden, Swiss Bank Corp Switzerland, Barclays
Bank Bostwana, Standard Charter Bank Thailand, ABAS Securities, CEDEL,
Citibank Poland, and Citibank Norway;
- - Confirmation of all securities hypothecated, pledged, placed in escrow, or
out for transfer with brokers, pledgees and/or transfer agents;
- - Reconciliation of all such securities to the books and records of the
Funds and the Custodian.
- - Confirmation of all repurchase agreements with brokers/banks and
agreement of underlying collateral with Bankers Trust records; and
- - Agreed selected securities purchased and securities sold or matured
since our last report from the books and records of the Funds to broker
confirms.
We believe that our examination provides a reasonable basis for our opinion. Our
examination does not provide a legal determination on the Funds' compliance with
specified requirements.
In our opinion, management's assertion that the Funds were in compliance with
the requirements of subsections (b) and(c) of Rule 17f-2 of the Investment
Company Act of 1940 as of February 26, 1999 with respect to securities reflected
in the investment accounts of the Funds is fairly stated, in all material
respects.
<PAGE>
This report is intended solely for the information and use of management of the
Funds and the Securities and Exchange Commission and should not be used for any
other purpose.
/s/ PricewaterhouseCoopers LLP
New York, New York
September 13, 1999
<PAGE>
PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
1177 Avenue of the Americas
New York, NY 10036
Telephone (212) 596-8000
Facsimile (212) 596-8910
September 20, 1999
Securities and Exchange Commission
Philadelphia District
Curtis Center, Suite 1105E
601 Walnut Street
Philadelphia, PA 19106
Dear Sirs:
In compliance with Rule 17f-2 promulgated under the Investment Company Act of
1940, enclosed is our report covering our examinations of the securities of the
BT Alex.Brown Cash Reserve Fund, Inc.-Prime Series, BT Alex.Brown Cash Reserve
Fund, Inc.-Treasury Series, BT Alex.Brown Cash Reserve Fund, Inc.-Tax Free
Series, Flag Investor Emerging Growth Fund, Inc., Flag Investors Equity Partners
Fund, Inc., Flag Investors Real Estate Securities Fund, Inc. Flag Investors
Communications Fund, Inc. Flag Investors Value Builder Fund, Inc., Flag
Investors Short Intermediate Income Fund, Inc., and Flag Investors International
Fund, inc. at the close of business on February 26, 1999.
Very truly yours,
/s/ PricewaterhouseCoopers LLP
KJB:mlr
Enclosures
<PAGE>
FORM N-17F-2
Certificate of Accounting of Securities and Similar
Investments in the Custody of
Management Investment Companies
Pursuant to Rule 17f-2 (17 CFR 370.17f-2)
- --------------------------------------------------------------------------------
1. Investment Company Act File Number 811-3196 Date examination
BT Alex Brown Cash Reserve Fund, Inc., 811-3383 completed:
Flag Investors Communications Fund, Inc. 811-4827 February 26, 1999
Flag Investors Income
- --------------------------------------------------------------------------------
2. State Identification Numbers
AL AK AZ AR CA CO
- --------------------------------------------------------------------------------
CT DE DC FL GA HI
- --------------------------------------------------------------------------------
ID IL IN IA KS KY
- --------------------------------------------------------------------------------
LA ME MD MA MI MN
- --------------------------------------------------------------------------------
MS MO MT NE NV NH
- --------------------------------------------------------------------------------
NJ NM NY NC ND OH
- --------------------------------------------------------------------------------
OK OR PA RI SC SD
- --------------------------------------------------------------------------------
TN TX UT VT VA WA
- --------------------------------------------------------------------------------
WV WI WY PUERTO RICO
- --------------------------------------------------------------------------------
3. Exact name of investment company as specified in registrations statement
See 1 above
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
4. Address of principal executive office (number, street, city, state, zip code)
1 South street, Baltimore, Maryland 21202
- --------------------------------------------------------------------------------
INSTRUCTIONS
This Form must be completed by investment companies that have custody of
securities or similar investments
Investment Company
1. All items must be completed by the investment company.
2. Give this Form to the independent public accountant who, in
compliance with Rule 17f-2 under the Act and applicable state law,
examines securities and similar investments in the custody of the
investment company.
Accountant
3. Submit this Form to the Securities and Exchange Commission and
appropriate state securities administrators when filing the
certificate of accounting required by Rule 17f-2 under the Act and
applicable state law. File the original and one copy with the
Securities and Exchange Commission's principal offices in Washington,
D.C., one copy with the regional office for the region in which the
investment company's principal business operations are conducted, and
one copy with the appropriate state administrator(s), if applicable.
THIS FORM MUST BE GIVEN TO YOUR INDEPENDENT PUBLIC ACCOUNTANT
*national Fund, Inc., 811-5320 Flag Investors Emerging Growth Fund, Inc.,
811-6084 Flag Investors Short-Intermediate Income Fund, Inc., 811-6600 Flag
Investors Value Builder Fund, Inc., 811-8500 Flag Investors Real Estate
Securities Fund, Inc., 811-8886 Flag Investors Equity Partners Fund, Inc.
