EATON VANCE TAX FREE RESERVES, 485B24E, 1995-05-01

EATON VANCE TAX FREE RESERVES
485B24E, 1995-05-01

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<PAGE>

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL , 1995
1933 ACT FILE NO. 2-73244
1940 ACT FILE NO. 811-3226
================================================================================

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM N-1A
REGISTRATION STATEMENT
UNDER
SECURITIES ACT OF 1933 [X]

POST-EFFECTIVE AMENDMENT NO. 13 [X]

REGISTRATION STATEMENT
UNDER
THE INVESTMENT COMPANY ACT OF 1940 [X]

AMENDMENT NO. 16 [X]

EATON VANCE TAX FREE RESERVES
-----------------------------
(EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER)
24 FEDERAL STREET, BOSTON, MASSACHUSETTS 02110
---------------------------------------
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
617-482-8260
---------------------------------
(REGISTRANT'S TELEPHONE NUMBER)
H. DAY BRIGHAM, JR.
24 FEDERAL STREET, BOSTON, MASSACHUSETTS 02110
----------------------------------------------
(NAME AND ADDRESS OF AGENT FOR SERVICE)

It is proposed that this filing will become effective on May 1, 1995
pursuant to paragraph (b) of Rule 485.

The exhibit index required by Rule 483(a) under the Securities Act of 1933
is located on page in the sequential numbering system of the manually signed
copy of this Registration Statement.
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
======================================================================================================
PROPOSED
AMOUNT OF PROPOSED MAXIMUM AGGREGATE AMOUNT OF
TITLE OF SECURITIES SHARES BEING OFFERING PRICE MAXIMUM REGISTRATION
BEING REGISTERED REGISTERED PER SHARE OFFERING PRICE FEE
- ------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares of beneficial interest.... 31,736,923 $1.00<F1> $31,736,923<F2> $100
======================================================================================================
<FN>
<F1>Computed under Rule 457(d) on the basis of the offering price per share at the close of business on
April 25, 1995.
<F2>Registrant elects to calculate the maximum aggregate offering price pursuant to Rule 24e-2.
166,830,592 shares were redeemed during the fiscal year ended December 31, 1994. 135,383,669 shares
were used for reductions pursuant to Paragraph (c) of Rule 24f-2 during such fiscal year.
31,446,923 of the shares redeemed are being used for the reduction of the registration fee in this
Amendment. While no fee is required for the 31,446,923 shares, the Registrant has elected to
register, for $100, an additional 290,000 shares (290,000 shares at $1.00 per share).

Pursuant to Rule 24f-2 under the Investment Company Act of 1940, Registrant has registered an
indefinite number of securities under the Securities Act of 1933. Registrant filed a Rule 24f-2 Notice
for the Registrant with the fiscal year ended December 31, 1994 on February 23, 1995. Registrant
continues its election to register an indefinite number of shares of beneficial interest pursuant to
Rule 24f-2.
=======================================================================================================
</TABLE>
<PAGE>

This Amendment to the registration statement on Form N-1A consists of
the following documents and papers:

Cross Reference Sheet required by Rule 481(a) under Securities Act of
1933

Part A -- The Prospectus

Part B -- Statement of Additional Information

Part C -- Other Information

Signatures

Exhibit Index Required by Rule 483(a) under the Securities Act of 1933

Exhibits
<PAGE>
EATON VANCE TAX FREE RESERVES

CROSS REFERENCE SHEET
ITEMS REQUIRED BY FORM N-1A
---------------------------
PART A
ITEM NO. ITEM CAPTION PROSPECTUS CAPTION
- ---------- ------- ----------------------------

1. .............. Cover Page Cover Page
2. .............. Synopsis Shareholder and Fund
Expenses
3. .............. Condensed Financial The Funds' Financial
Information Highlights;
Yield Information
4. .............. General Description of The Funds' Investment
Registrant Objectives; How the Funds
Invest their Assets;
Organization of the Funds
and the Portfolio
5. .............. Management of the Fund Management of the Funds and
the Portfolio
5a............... Management's Discussion of Not Applicable
Fund Performance
6. .............. Capital Stock and Other Organization of the Funds
Securities and the Portfolio;
Distributions and Taxes
7. .............. Purchase of Securities Being Valuing Fund Shares; How to
Offered Buy Fund Shares; The
Lifetime Investing
Account/Distribution
Options
8. .............. Redemption or Repurchase How to Redeem Fund Shares
9. .............. Pending Legal Proceedings Not Applicable

PART B STATEMENT OF ADDITIONAL
ITEM NO. ITEM CAPTION INFORMATION CAPTION
- ---------- ------- ----------------------------
10. .............. Cover Page Cover Page
11. .............. Table of Contents Table of Contents
12. .............. General Information and General Information and
History History
13. .............. Investment Objectives and Investment Objective,
Policies Policies and
Restrictions
14. .............. Management of the Fund Officers and Trustees of the
Fund
15. .............. Control Persons and Control Persons and
Principal Holders of Principal Holders of
Securities Securities

16. .............. Investment Advisory and Investment Adviser,
Other Custodian and Back Cover
Services
17. .............. Brokerage Allocation and Portfolio Security
Other Transactions
Practices
18. .............. Capital Stock and Other Other Information
Securities
19. .............. Purchase, Redemption and Determination of Net Asset
Pricing of Securities Value; Service for
Being Offered Withdrawal

20. .............. Tax Status Taxes
21. .............. Underwriters Principal Underwriter
22. .............. Calculation of Yield Calculation of Yield
Quotations of Quotations
Money Market Funds
23. .............. Financial Statements Financial Statements
<PAGE>

PART A
INFORMATION REQUIRED IN A PROSPECTUS
EATON VANCE CASH MANAGEMENT FUND
EATON VANCE LIQUID ASSETS FUND
EATON VANCE MONEY MARKET FUND
EATON VANCE TAX FREE RESERVES

EATON VANCE CASH MANAGEMENT FUND ("Cash Fund"), EATON VANCE LIQUID ASSETS
FUND ("Liquid Assets Fund") and EATON VANCE MONEY MARKET FUND ("Money Market
Fund") are diversified money market funds seeking high income consistent with
preservation of capital and maintenance of liquidity. EATON VANCE TAX FREE
RESERVE ("Tax Free Reserves") is a diversified money market fund seeking high
income exempt from regular Federal income tax consistent with preservation of
capital and maintenance of liquidity. The Cash, Liquid Assets and Money Market
Funds invest all of their assets in Cash Management Portfolio (the "Portfolio"),
a separate, diversified investment company with the same investment objective,
rather than investing in and managing its own portfolio of securities as with an
historically structured mutual fund. Tax Free Reserves invests directly in its
own portfolio of money market instruments.

AN INVESTMENT IN A FUND IS NOT GUARANTEED OR FEDERALLY INSURED BY THE U.S.
GOVERNMENT, THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD
OR ANY OTHER GOVERNMENT AGENCY. SHARES OF A FUND ARE NOT OBLIGATIONS OR DEPOSITS
OF, OR GUARANTEED OR ENDORSED BY, ANY BANK OR OTHER INSURED DEPOSITORY
INSTITUTION. THERE IS NO ASSURANCE THAT A FUND WILL BE ABLE TO MAINTAIN A STABLE
NET ASSET VALUE OF $1.00 PER SHARE. SHARES OF EACH FUND INVOLVE INVESTMENT
RISKS, INCLUDING FLUCTUATIONS IN VALUE AND THE POSSIBLE LOSS OF SOME OR ALL OF
THE PRINCIPAL INVESTMENT.

This Prospectus is designed to provide you with information you should know
before investing. Please retain this document for future reference. A Statement
of Additional Information dated May 1, 1995 for each Fund, as supplemented from
time to time, has been filed with the Securities and Exchange Commission and is
incorporated herein by reference. The Statements of Additional Information are
available without charge from the Funds' principal underwriter, Eaton Vance
Distributors, Inc., 24 Federal Street, Boston, MA 02110 (telephone (800)
225-6265). TAX FREE RESERVES IS NOT AVAILABLE FOR PURCHASE IN ALL STATES.
CONTACT THE PRINCIPAL UNDERWRITER OR YOUR BROKER FOR INFORMATION.

- ------------------------------------------------------------------------------
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.
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PAGE PAGE
---- ----
<S> <C> <S> <C>
Shareholder and Fund Expenses ...................... 2 How to Redeem Fund Shares ...................... 17
The Funds' Financial Highlights .................... 4 Reports to Shareholders ........................ 19
The Funds' Investment Objectives ................... 7 The Lifetime Investing Account/Distribution
How the Funds Invest their Assets................... 7 Options ...................................... 19
Organization of the Funds and the Portfolio ........ 9 The Eaton Vance Exchange Privilege ............. 20
Management of the Funds and the Portfolio .......... 12 Eaton Vance Shareholder Services ............... 22
Distribution Plans ................................. 13 Distributions and Taxes ........................ 23
Valuing Fund Shares ................................ 15 Yield Information .............................. 24
How to Buy Fund Shares ............................. 16
- --------------------------------------------------------------------------------
</TABLE>
PROSPECTUS DATED MAY 1, 1995

<PAGE>
SHAREHOLDER AND FUND EXPENSES
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
CASH LIQUID ASSETS MONEY MARKET TAX FREE
SHAREHOLDER TRANSACTION EXPENSES FUND FUND FUND RESERVES
---- ------------- ------------ --------
<S> <C> <C> <C> <C>
Sales Charges Imposed on Purchases of Shares None None None None
Sales Charges Imposed on Reinvested Distributions None None None None
Fees to Exchange Shares None None None None
Range of Declining Contingent Deferred Sales Charges Imposed on Redemption
During the First Seven Years (as a percentage of redemption proceeds
exclusive of all reinvestments and capital appreciation in the
account) None 5.0% - 0% 5.0% - 0% None

ANNUAL FUND (AND ALLOCATED PORTFOLIO) OPERATING EXPENSES
CASH LIQUID ASSETS MONEY MARKET TAX FREE
(as a percentage of average net assets) FUND FUND FUND RESERVES
---- ------------- ------------ --------
Investment Adviser Fee 0.50% 0.50% 0.50% 0.10%*
Rule 12b-1 Distribution (and Service) Fees -- 0.05 0.85 --
Interest Expense -- -- -- 0.07
Other Expenses 0.34 0.39 0.25 0.37
---- ---- ---- ---
Total Operating Expenses 0.84% 0.94% 1.60% 0.54%
==== ==== ==== ---
- ----------
*After reduction by Investment Adviser.

EXAMPLE
An investor would pay the following contingent deferred sales charge and
expenses on a $1,000 investment, assuming 5% annual return and redemption at the
end of each period:
CASH LIQUID ASSETS MONEY MARKET TAX FREE
FUND FUND FUND RESERVES
---- ------------- ------------ --------
1 Year N/A $ 60 $66 N/A
3 Years N/A 70 90 N/A
5 Years N/A 72 N/A N/A
10 Years N/A 115 N/A N/A

An investor would pay the following expenses on the same investment, assuming 5%
annual return and no redemptions:

CASH LIQUID ASSETS MONEY MARKET TAX FREE
FUND FUND FUND RESERVES
---- ------------- ------------ --------
1 Year $ 9 $ 10 $16 $ 10
3 Years 27 30 70 30
5 Years 47 52 N/A 52
10 Years 104 115 N/A 115

Notes:

The tables and Examples are designed to help investors understand the costs
and expenses they will bear, directly or indirectly, by investing in the Funds.
Information for each of the Funds is based on their expenses for the most recent
fiscal year, except that information for the Money Market Fund is estimated for
its current fiscal year, since the Fund was only recently organized. The
Investment Adviser Fee for Tax Free Reserves reflects a partial waiver of the
fee. In the absence of the waiver, the Investment Adviser Fee would be 0.50%,
and Total Operating Expenses would be 0.94%.

The Cash, Liquid Assets, and Money Market Funds invest exclusively in the
Portfolio. Their Trustees believe that, over time, the aggregate per share
expenses of each Fund and the Portfolio should be approximately equal to, or
less than, the per share expense the Fund would incur if the Fund were instead
to retain the services of an investment adviser and its assets were invested
directly in the types of securities being held by the Portfolio.

The Example should not be considered a representation of past or future
expenses and actual expenses may be greater or less than those shown. Federal
regulations require the Examples to assume a 5% annual return, but actual annual
return will vary. A long-term shareholder in a Fund paying Rule 12b-1
Distribution Fees may pay more than the economic equivalent of the maximum
front-end sales charge permitted by the rules of the National Association of
Securities Dealers, Inc.

No contingent deferred sales charge is imposed on (a) shares purchased more
than six years prior to redemption, (b) shares acquired through the reinvestment
of distributions or (c) any appreciation in value of other shares in the
account, and no such charge is imposed on exchanges of Fund shares for shares of
one or more other funds listed under "The Eaton Vance Exchange Privilege". See
"How to Redeem Fund Shares".

Other investment companies and investors with different distribution
arrangements and fees may invest in the Portfolio in the future. See
"Organization of the Funds and the Portfolio".

<PAGE>

THE FUNDS' FINANCIAL HIGHLIGHTS
- ------------------------------------------------------------------------------

The following information should be read in conjunction with the financial
statements included in the Statement of Additional Information, all of which has
been so included in reliance upon the reports of Coopers & Lybrand L.L.P.,
independent accountants, as experts in accounting and auditing. Further
information regarding the performance of the Funds, is contained in their annual
reports to shareholders which may be obtained without charge by contacting the
Principal Underwriter, Eaton Vance Distributors, Inc.

</TABLE>
<TABLE>
<CAPTION>

CASH FUND
-----------------------------------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31,
-----------------------------------------------------------------------------------------------------------
1994 1993 1992 1991<F2> 1990<F2> 1989<F2> 1988<F2> 1987<F2> 1986<F2> 1985<F2>
-------- -------- -------- -------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE --
beginning of year . $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
-------- -------- -------- -------- -------- -------- -------- -------- -------- --------
INCOME FROM INVESTMENT
OPERATIONS:
Net investment
income .......... $ 0.0345 $ 0.0251 $ 0.0306 $ 0.0537 $ 0.0755 $ 0.0846 $ 0.0688 $ 0.0607 $ 0.0610 $ 0.0738
-------- -------- -------- -------- -------- -------- -------- -------- -------- --------
LESS DISTRIBUTIONS:
Dividends from net
investment income .. $(0.0345) $(0.0251) $(0.0306) $(0.0537) $(0.0755) $(0.0846) $(0.0688) $(0.0607) $(0.0610) $(0.0738)
-------- -------- -------- -------- -------- -------- -------- -------- -------- --------
NET ASSET VALUE, end
of year ........... $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
======== ======== ======== ======== ======== ======== ======== ======== ======== ========
TOTAL RETURN<F4> ... 3.49% 2.54% 3.14% 5.51% 7.82% 8.87% 7.12% 6.23% 6.27% 7.66%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of
year (000's
omitted)......... $111,622 $112,200 $161,986 $195,488 $250,658 $246,220 $174,842 $257,607 $212,050 $207,328
Ratio of expenses
to average net
assets .......... 0.844%<F5> 0.674% 0.760% 0.746% 0.710% 0.710% 0.719% 0.664% 0.697% 0.720%
Ratio of net
invesment income
to average net
assets ......... 3.396%<F5> 2.512% 3.088% 5.442% 7.540% 8.460% 6.920% 6.027% 6.130% 7.540%

Note: Certain of the per share amounts have been compiled using average shares
outstanding.
<FN>
<F1> For the nine months ended December 31, 1993.

<F2> Audited by the Funds' previous auditors.
<F3> Computed on an annualized basis.
<F4> Total return is calculated assuming a purchase at the net asset value on
the first day and a sale at the net asset value on the last day of each
period reported. Dividends and distributions, if any, are assumed to be
reinvested at the net asset value on the payable date.
<F5> Includes the Fund's share of Cash Management Portfolio's allocated income
and expenses for the period from May 2, 1994 to December 31, 1994.

</TABLE>

<PAGE>

<TABLE>
THE FUNDS' FINANCIAL HIGHLIGHTS (CONTINUED)
- ----------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
LIQUID ASSETS FUND
-------------------------------------------------------------------------------------------------
YEAR ENDED
DECEMBER 31, YEAR ENDED MARCH 31,
----------------------- --------------------------------------------------------------------
1994 1993<F1> 1993<F2> 1992<F2> 1991<F2> 1990<F2> 1989<F2> 1988<F2>
-------- -------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, beginning
of year $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00

INCOME FROM INVESTMENT OPERATIONS:
Net investment income .... 0.03276 0.01133 0.02175 0.04155 0.06209 0.07265 0.06319 0.04775

LESS DISTRIBUTIONS:
Dividends from net
investment income ...... (0.03276) (0.01133) (0.02175) (0.04155) (0.06209) (0.07265) (0.06319) (0.04775)
-------- -------- -------- -------- -------- -------- -------- --------
NET ASSET VALUE, end of year. $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
======== ======== ======== ======== ======== ======== ======== ========
TOTAL RETURN<F4> ............ 3.29% 1.14% 2.35% 4.38% 6.50% 7.59% 6.37% 4.46%

RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(000's omitted) ........ $118,599 $10,566 $18,553 $9,145 $19,996 $21,601 $10,705 $13,105
Ratio of expenses to
average net assets ..... 0.94%<F5> 1.49%<F3> 0.92% 1.23% 1.68% 2.08% 1.71% 1.42%

Ratio of net investment
income to average net
assets ................. 3.55%<F5> 1.66%<F3> 2.33% 4.30% 6.23% 7.20% 6.24% 5.82%

During each of the periods presented the expenses related to the operation of the Fund were reduced either by a reduction of the
investment advisory fee, an allocation of expenses to the investment adviser, or both. Had such actions not been undertaken, net
investment income per share and the ratios would have been as follows:

</TABLE>
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED MARCH 31,
DECEMBER 31, ---------------------------------------------------------------------
1993<F1> 1993<F2> 1992<F2> 1991<F2> 1990<F2> 1989<F2> 1988<F2>
-------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
NET INVESTMENT INCOME PER SHARE ........... $0.00919 $0.01708 $0.03719 $0.05701 $0.06871 $0.05590 $0.03743
RATIOS (As a percentage of average net assets):
Expenses ................................ 1.80%<F3> 1.42% 1.73% 2.19% 2.47% 2.43% 3.16%
======== ======== ======== ======== ======== ======== ========
Net investment income ................... 1.35%<F3> 1.85% 3.80% 5.72% 6.81% 5.52% 4.08%
======== ======== ======== ======== ======== ======== ========
<FN>
<F1> For the nine months ended December 31, 1993.

</TABLE>
<PAGE>

THE FUNDS' FINANCIAL HIGHLIGHTS (CONTINUED)
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>

TAX FREE RESERVES
---------------------------------------------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31,
---------------------------------------------------------------------------------------------------------------------
1994 1993 1992 1991<F2> 1990<F2> 1989<F2> 1988<F2> 1987<F2> 1986<F2> 1985<F2>
---------- ---------- ---------- --------- ---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
NET ASSET
VALUE --
Beginning
of year ... $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
---------- ---------- ---------- --------- ---------- ---------- ---------- ---------- ---------- ----------
INCOME FROM
OPERATIONS:
Net
investment
income.... $ 0.023548 $ 0.018399 $ 0.023468 $ 0.038797 $ 0.051929 $ 0.055218 $ 0.047113 $ 0.039484 $ 0.042457 $ 0.047214
---------- ---------- ---------- --------- ---------- ---------- ---------- ---------- ---------- ----------
LESS
DISTRIBUTIONS
DECLARED TO
SHAREHOLDERS:
From net
investment
income ... $(0.023548) $(0.018399) $(0.023468) $0.038797) $(0.051929) $(0.055218) $(0.047113) $(0.039484) $(0.042457) $(0.047214)
---------- ---------- ---------- --------- ---------- ---------- ---------- ---------- ---------- ----------
NET ASSET
VALUE, end
of year .... $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
========== ========== ========== =========== =========== =========== =========== =========== ========== ==========
TOTAL
RETURN<F4>.. 2.36% 1.86% 2.36% 3.92% 5.30% 5.67% 4.80% 4.01% 4.35% 4.79%
RATIOS/
SUPPLEMENTAL
DATA:
Net assets,
end of year
(000's
omitted) .. $29,021 $60,247 $44,337 $47,140 $53,753 $26,745 $73,855 $78,369 $77,137 $49,075
Interest
expense to
average net
assets .... 0.07% 0.03% 0.06% 0.09% 0.05% 0.26% 0.08% 0.07% 0.15% -- %
Net other
expenses to
average net
assets .... 0.47% 0.62% 0.53% 0.49% 0.70% 0.82% 0.76% 0.75% 0.61% 0.60%
Net investment
income to
average net
assets .... 2.27% 1.82% 2.34% 3.92% 5.19% 5.60% 4.70% 3.96% 4.14% 4.70%
</TABLE>

During each of the years in the five year period ended December 31, 1994, the
expenses related to the operation of the Fund were reduced either by a reduction
of the investment adviser fee, an allocation of expenses to the investment
adviser, or both. Had such actions not been undertaken, net investment income
per share and the ratios would have been as follows:
<TABLE>
<CAPTION>

YEAR ENDED DECEMBER 31,
----------------------------------------------------------------------------------------------------------
1994 1993 1992 1991<F2> 1990<F2> 1989<F2> 1987<F2> 1986<F2> 1985<F2>
---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
NET INVESTMENT INCOME
PER SHARE ......... $ 0.018948 $ 0.016668 $ 0.020133 $ 0.034647 $ 0.050052 $ 0.054822 $ 0.008966 $ 0.009147 $ 0.007935
========== ========== ========== ========== ========== ========== ========== ========== ==========
RATIOS (As a
percentage of
average net
assets):
Other expenses ... 0.87% 0.82% 0.92% 0.91% 0.85% 0.85% 0.81% 0.72% 0.79%
---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
Net investment
income .......... 1.88% 1.65% 2.01% 3.50% 5.04% 5.57% 3.90% 4.03% 4.51%
========== ========== ========== ========== ========== ========== ========== ========== ==========
</TABLE>

From time to time it has been necessary for Tax Free Reserves to borrow from
banks as a temporary measure to facilitate the orderly sale of portfolio
securities to accommodate redemption requests. The following table summarizes
such temporary borrowings:
<TABLE>
<CAPTION>
AVERAGE DAILY AVERAGE WEEKLY AVERAGE AMOUNT
AMOUNT OF BALANCE OF BALANCE OF OF DEBT
YEAR ENDED DEBT OUTSTANDING DEBT OUTSTANDING SHARES OUTSTANDING PER SHARE
DECEMBER 31, AT END OF YEAR DURING YEAR DURING YEAR DURING YEAR
- ------------ ---------------- ---------------- ------------------ -----------
<S> <C> <C> <C> <C>
1986<F2> ........................... $ -- $1,316,000 66,327,940 $0.020
1987<F2> ........................... -- 1,312,000 68,850,770 0.019
1988<F2> ........................... 166,000 1,401,000 72,897,174 0.019
1989<F2> ........................... 82,000 1,825,000 52,596,221 0.035
1990<F2>............................ -- 192,000 31,243,924 0.006
1991<F2> ........................... -- 379,000 31,686,707 0.012
1992 ............................... -- 367,000 38,904,763 0.009
1993 ............................... 2,428,000 285,000 48,697,998 0.006
1994 ............................... 6,117,000 440,145 40,463,382 0.011

Footnotes:
<FN>
<F1> For the nine months ended December 31, 1993.

<PAGE>

THE FUNDS' INVESTMENT OBJECTIVES
- ------------------------------------------------------------------------------

The investment objective of EATON VANCE CASH MANAGEMENT FUND, EATON VANCE LIQUID
ASSETS FUND and EATON VANCE MONEY MARKET FUND is to provide as high a rate of
income as may be consistent with preservation of capital and maintenance of
liquidity. The investment objective of EATON VANCE TAX FREE RESERVES is to
provide a means whereby investors may earn as high a rate of income exempt from
regular Federal income tax as may be consistent with the preservation of capital
and maintenance of liquidity. The investment objective and policies of each Fund
may be changed by the Trustees without a vote of shareholders; as a matter of
policy, the Trustees would not materially change the investment objective of a
Fund without shareholder approval. Each Fund seeks to maintain a constant net
asset value of $1 per share, although there can be no assurance it will be able
to do so.

The Cash Fund and Tax Free Reserves are offered to shareholders in exchange
for their shares in the Eaton Vance Traditional Group of Funds. The Money Market
Fund offers its shares to shareholders exchanging their shares from the Eaton
Vance Marathon and Eaton Vance Classic Group of Funds. (The Money Market Fund
may not be a suitable investment for investors who do not intend to use it as an
exchange vehicle.) The Liquid Assets Fund is currently closed to new
investments, whether by exchange or initial subscription.

HOW THE FUNDS INVEST THEIR ASSETS
- ------------------------------------------------------------------------------

CASH FUND, LIQUID ASSETS FUND, AND MONEY MARKET FUND

Each of these Funds seeks its objective by investing all of its assets in
the Portfolio, which is itself an open-end investment company. The Portfolio
invests in the following types of high quality, U.S. dollar-denominated money
market instruments of domestic and foreign issuers:

* U.S. GOVERNMENT SECURITIES: marketable securities issued or guaranteed as
to principal or interest by the U.S. Government or by its agencies or
instrumentalities. Some of these securities are backed by the full faith
and credit of the U.S. Government; others are backed only by the credit of
the agency or instrumentality issuing the securities.

* PRIME COMMERCIAL PAPER: high-grade, short-term obligations issued by
banks, corporations, and other issuers.

* CORPORATE OBLIGATIONS: high-grade, short-term obligations other than prime
commercial paper.

* BANK CERTIFICATES OF DEPOSIT (CDS): negotiable certificates issued against
funds deposited in a commercial bank for a definite period of time and
earning a specified return.

* BANKERS' ACCEPTANCES: negotiable drafts or bills of exchange, which have
been "accepted" by a bank, means, in effect, that the bank has
unconditionally agreed to pay the face value of the instrument on
maturity.

Investments are described further below under "All Funds -- Selection of
Investments." The Portfolio may invest without limit in securities of finance
companies or in securities of banks and thrift institutions (and their holding
companies) whenever yield differentials or money market conditions indicate that
such a concentration of the Portfolio's investments may be desirable.

The Portfolio may invest without limit in U.S. dollar-denominated
obligations of foreign issuers, including foreign banks. Such investments
involve special risks. These include future unfavorable political and economic
developments, possible withholding taxes, seizure of foreign deposits, interest
limitations or other governmental restrictions which might affect payment of
principal or interest. Additionally, there may be less public information
available about foreign banks and their branches. Foreign branches of foreign
banks are not regulated by U.S. banking authorities, and generally are not bound
by accounting, auditing and financial reporting standards comparable to U.S.
banks. Although the Portfolio's investment adviser carefully considers these
factors when making investments, the Portfolio does not limit the amount of its
assets which can be invested in one type of instrument or in any foreign
country.

TAX FREE RESERVES
Tax Free Reserves seeks to achieve its objective by investing in a
diversified portfolio of obligations, including bonds, notes and commercial
paper, issued by or on behalf of states, territories and possessions of the
United States and their political subdivisions, agencies and instrumentalities,
and the District of Columbia, the interest from which is exempt from regular
Federal income tax. The Fund may acquire stand-by commitments with respect to
portfolio securities and, with respect to 10% of net assets, may purchase shares
of unaffiliated investment companies with the same objective. Investments are
described further below under "All Funds -- Selection of Investments".

The Fund is designed for those institutional and individual investors who
seek to earn tax-free income and to avoid fluctuation in the value of their
investment while at the same time having the flexibility to liquidate and
withdraw funds at any time. By combining the assets of shareholders, the Fund
can provide yields normally available through investment in tax-free money
market instruments of large denominations, and can obtain the benefits of
diversification and liquidity through investment in the obligations of many
issuers with various maturities.

A portion of the dividends paid by the Fund may be subject to Federal income
tax, and dividends may be subject to state and local taxes. As a matter of
fundamental policy which may not be changed unless authorized by shareholder
vote, the Fund may not purchase any securities which would cause more than 20%
of the value of its total assets to be invested in securities the interest on
which is not exempt from Federal income tax.

Distribution of interest on "public purpose" state and municipal obligations
and on certain "private activity" obligations is exempt from all types of
Federal income taxes applicable to individuals. Interest on certain other
"private activity bonds" issued after August 7, 1986 is exempt from regular
Federal income tax applicable to individuals (and corporations) but is treated
as a tax preference item which could subject the recipient to the Federal
alternative maximum tax. (On December 31, 1994, the Fund did not hold any of
these investments in its portfolio). Interest on municipal obligations (whenever
issued) is included in "adjusted current earnings" for the purposes of the
alternative minimum tax applicable to corporations.

ALL FUNDS -- SELECTION OF INVESTMENTS
The Portfolio and Tax Free Reserves will invest only in U.S.
dollar-denominated high-quality securities and other U.S. dollar-denominated
money market instruments meeting credit criteria which the Trustees believe
present minimal credit risk. "High-quality securities" are (i) short-term
obligations rated in one of the two highest short-term ratings categories by at
least two nationally recognized rating services (or, if only one rating service
has rated the security, by that service), (ii) obligations rated at least AA by
Standard & Poor's Ratings Group or Aa by Moody's Investors Service, Inc. at the
time of investment, and (iii) unrated securities determined by the investment
adviser to be of comparable quality, subject to the overall supervision of the
Trustees. For a description of the instruments and ratings see the "Appendix" in
the Statement of Additional Information. Each of the Portfolio and Tax Free
Reserves will maintain a dollar-weighted average maturity of 90 days or less and
will not invest in securities with remaining maturities of more than 397 days.
The Portfolio and Tax Free Reserves may invest in variable or floating-rate
securities which bear interest at rates subject to periodic adjustment or which
provide for periodic recovery of principal on demand. Under certain conditions,
these securities may be deemed to have remaining maturities equal to the time
remaining until the next interest adjustment date or the date on which principal
can be recovered on demand. The Portfolio will not invest more than 5%
(determined at the time of investment) of its total assets in securities rated
below the highest applicable rating category, nor will it purchase securities of
any issuer if, immediately thereafter, more than 5% of the Portfolio's total
assets would be invested in securities of that issuer. The Portfolio and Tax
Free Reserves follow investment and valuation policies designed to maintain a
stable net asset value of $1 per Fund share, although there is no assurance that
these policies will be successful.

Considerations of liquidity and preservation of capital mean that the
Portfolio or Tax Free Reserves may not necessarily invest in money market
instruments paying the highest available yield at a particular time. Consistent
with their investment objectives, the Portfolio and Tax Free Reserves will
attempt to maximize yields by portfolio trading and by buying and selling
portfolio investments in anticipation of or in response to changing economic and
money market conditions and trends. The Portfolio and Tax Free Reserves may also
invest to take advantage of what their investment advisers believe to be
temporary disparities in yields of different segments of the high-grade money
market or among particular instruments within the same segment of the market.
These policies, as well as the relatively short maturities of obligations
purchased by the Portfolio and Tax Free Reserves, may result in frequent changes
in their portfolios. The Portfolio and Tax Free Reserves will not usually pay
brokerage commissions in connection with the purchase or sale of portfolio
securities.

Securities loans, repurchase agreements, when-issued securities and forward
commitments. The Portfolio and Tax Free Reserves may lend their portfolio
securities to broker-dealers and may enter into repurchase agreements. These
transactions must be fully collateralized at all times, but involve some risk to
the lender if the other party should default on its obligations or if the lender
is delayed or prevented from recovering the collateral. The Portfolio and Tax
Free Reserves may also purchase securities on a when-issued basis and for future
delivery by means of "forward commitments." A segregated account will be
maintained to cover such purchase obligations.

An investment in a Fund is subject to interest rate risk and credit risks of
the issuers of the money market instruments. Each Fund's income will fluctuate
and net asset value under certain circumstances could change. If any changes
were made in a Fund's investment objective, the Fund may no longer be
appropriate to certain investors. Investments and restrictions thereon are
further described in the Statements of Additional Information.

NONE OF THE FUNDS IS A COMPLETE INVESTMENT PROGRAM, AND PROSPECTIVE
INVESTORS SHOULD TAKE INTO ACCOUNT THEIR OBJECTIVES AND OTHER INVESTMENTS
WHEN CONSIDERING THE PURCHASE OF FUND SHARES. THE FUNDS CANNOT ELIMINATE
RISK OF LOSS OR ASSURE y ACHIEVEMENT OF THEIR INVESTMENT OBJECTIVES.

ORGANIZATION OF THE FUNDS AND THE PORTFOLIO
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THE TRUSTEES OF EACH TRUST ARE RESPONSIBLE FOR THE OVERALL MANAGEMENT AND
SUPERVISION OF ITS AFFAIRS. Each trust may issue an unlimited number of shares
of beneficial interest (no par value per share) in one or more series. Each
share represents an equal proportionate beneficial interest in a Fund. When
issued and outstanding, the shares are fully paid and nonassessable by a trust
and redeemable as described under "How to Redeem Fund Shares". Shareholders are
entitled to one vote for each full share held. Fractional shares may be voted
proportionately. Shares have no preemptive or conversion rights and are freely
transferable. In the event of the liquidation of a Fund, shareholders are
entitled to share pro rata in the net assets of that Fund available for
distribution to shareholders.

The Cash Fund is a business trust established under Massachusetts law
pursuant to a Declaration of Trust dated October 16, 1974, as amended. Liquid
Assets Fund and Money Market Fund are series of Eaton Vance Liquid Assets Trust,
a business trust established under Massachusetts law pursuant to a Declaration
of Trust dated May 11, 1987, as amended. Tax Free Reserves is a business trust
established under Massachusetts law pursuant to a Declaration of Trust dated
July 15, 1981, as amended.

Cash Management Portfolio is organized as a trust under the laws of the
State of New York and intends to be treated as a partnership for Federal tax
purposes. The Portfolio, as well as the Funds, intend to comply with all
applicable Federal and state securities laws. The Portfolio's Declaration of
Trust provides that the Cash, Liquid Assets and Money Market Funds and other
entities permitted to invest in the Portfolio (e.g., other U.S. and foreign
investment companies, and common and commingled trust funds) will each be liable
for all obligations of the Portfolio. However, the risk of a Fund incurring
financial loss on account of such liability is limited to circumstances in which
both inadequate insurance exists and the Portfolio itself is unable to meet its
obligations. Accordingly, the Trustees of each trust believe that neither the
Funds nor their shareholders will be adversely affected by reason of the Fund's
investing in the Portfolio.

SPECIAL INFORMATION ON THE FUND/PORTFOLIO INVESTMENT STRUCTURE. An investor in
the Cash, Liquid Assets or Money Market Fund should be aware that each of those
Funds, unlike mutual funds which directly acquire and manage their own
portfolios of securities, seeks to achieve its investment objective by investing
its assets in an interest in the Portfolio (although the Fund may hold a de
minimis amount of cash), which is a separate investment company with an
identical investment objective. Therefore, the Fund's interest in the securities
owned by the Portfolio is indirect. In addition to selling an interest to the
Fund, the Portfolio may sell interests to other affiliated and non-affiliated
mutual funds or institutional investors. Such investors will invest in the
Portfolio on the same terms and conditions and will pay a proportionate share of
the Portfolio's expenses. However, the other investors investing in the
Portfolio are not required to sell their shares at the same public offering
price as the Fund due to variations in sales commissions and other operating
expenses. Therefore, investors in the Fund should be aware that these
differences may result in differences in returns experienced by investors in the
various funds that invest in the Portfolio. Such differences in returns are also
present in other mutual fund structures, including funds that have multiple
classes of shares. For information regarding the investment objective, policies
and restrictions, see "The Funds" Investment Objectives" and "How the Funds
Invest their Assets". Further information regarding investment practices may be
found in the Statements of Additional Information.

The Trustees of each trust have considered the advantages and disadvantages
of investing the assets of the relevant Fund in the Portfolio, as well as the
advantages and disadvantages of the two-tier format. The Trustees believe that
the structure offers opportunities for substantial growth in the assets of the
Portfolio, and affords the potential for economies of scale for the Fund.

Each of the Cash, Liquid Assets and Money Market Funds may withdraw
(completely redeem) all its assets from the Portfolio at any time if the Board
of Trustees of the relevant trust determines that it is in the best interest of
the Fund to do so. The investment objective and the nonfundamental investment
policies of a Fund and the Portfolio may be changed by the Trustees of a trust
and the Portfolio without obtaining the approval of the shareholders of the Fund
or the investors in the Portfolio, as the case may be. Any such change of the
investment objective will be preceded by thirty days' advance written notice to
the shareholders of the Fund or the investors in the Portfolio, as the case may
be. If a shareholder redeems shares because of a change in the nonfundamental
objective or policies of a Fund, those shares may be subject to a contingent
deferred sales charge, as described in "How to Redeem Fund Shares". In the event
a Fund withdraws all of its assets from the Portfolio, or the Board of Trustees
of a trust determines that the investment objective of the Portfolio is no
longer consistent with the investment objective of the Fund, the Trustees would
consider what action might be taken, including investing the assets of the Fund
in another pooled investment entity or retaining an investment adviser to manage
the Fund's assets in accordance with its investment objective. A Fund's
investment performance may be affected by a withdrawal of all its assets from
the Portfolio.

Information regarding other pooled investment entities or funds which invest
in the Portfolio may be obtained by contacting Eaton Vance Distributors, Inc.
(the "Principal Underwriter" or "EVD"), 24 Federal Street, Boston, MA 02110,
(617) 482-8260. Smaller investors in the Portfolio may be adversely affected by
the actions of larger investors in the Portfolio. For example, if a large
investor withdraws from the Portfolio, the remaining investors may experience
higher pro rata operating expenses, thereby producing lower returns.
Additionally, the Portfolio may become less diverse, resulting in increased
portfolio risk, and experience decreasing economies of scale. However, this
possibility exists as well for historically structured funds which have large or
institutional investors.

Until recently, Eaton Vance Management sponsored and advised funds with more
traditional organizational structures. Funds which invest all their assets in
interests in a separate investment company are a relatively new development in
the mutual fund industry and, therefore, the Cash, Liquid Assets and Money
Market Funds may be subject to additional regulations than historically
structured funds.

The Declaration of Trust of the Portfolio provides that the Portfolio will
terminate 120 days after the complete withdrawal of a Fund or any other investor
in the Portfolio, unless either the remaining investors, by unanimous vote at a
meeting of such investors, or a majority of the Trustees of the Portfolio, by
written instrument consented to by all investors, agree to continue the business
of the Portfolio. This provision is consistent with treatment of the Portfolio
as a partnership for Federal income tax purposes. See "Distributions and Taxes"
for further information. Whenever a Fund as an investor in the Portfolio is
requested to vote on matters pertaining to the Portfolio (other than the
termination of the Portfolio's business, which may be determined by the Trustees
of the Portfolio without investor approval), the Fund will hold a meeting of
Fund shareholders and will vote its interest in the Portfolio for or against
such matters proportionately to the instructions to vote for or against such
matters received from Fund shareholders. A Fund shall vote shares for which it
receives no voting instructions in the same proportion as the shares for which
it receives voting instructions. Other investors in the Portfolio may alone or
collectively acquire sufficient voting interests in the Portfolio to control
matters relating to the operation of the Portfolio, which may require the Fund
to withdraw its investment in the Portfolio or take other appropriate action.
Any such withdrawal could result in a distribution "in kind" of portfolio
securities (as opposed to a cash distribution from the Portfolio). If securities
are distributed, a Fund could incur brokerage, tax or other charges in
converting the securities to cash. In addition, the distribution in kind may
result in a less diversified portfolio of investments or adversely affect the
liquidity of the Fund. Notwithstanding the above, there are other means for
meeting shareholder redemption requests, such as borrowing.

The Trustees of each trust, including a majority of the noninterested
Trustees, have approved written procedures designed to identify and address any
potential conflicts of interest arising from the fact that some of the Trustees
of the trust and the Trustees of the Portfolio are the same. Such procedures
require each Board to take action to resolve any conflict of interest between
the Fund and the Portfolio, and it is possible that the creation of separate
Boards may be considered. For further information concerning the Trustees and
officers of a trust and the Portfolio, see the Statements of Additional
Information.

The shareholders of Tax Free Reserves have approved the adoption of an
investment policy for the Fund and the addition of a fundamental investment
provision to permit the Fund to invest its assets in an open-end management
investment company having substantially the same investment policies and
restrictions as the Fund. The Board of Trustees would implement the new
investment policy by investing the assets of the Fund in the Tax Free Reserves
Portfolio. If such action occurs, the foregoing discussion about the two-tier
investment structure would be applicable to Tax Free Reserves.

Although each Fund offers only its own shares of beneficial interest, it is
possible that a Fund might become liable for a misstatement or omission in this
Prospectus regarding another Fund because the Funds use this combined
Prospectus. The Trustees of each trust have considered this factor in approving
the use of a combined Prospectus.

MANAGEMENT OF THE FUNDS AND THE PORTFOLIO
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THE PORTFOLIO ENGAGES BOSTON MANAGEMENT AND RESEARCH ("BMR"), A WHOLLY-OWNED
SUBSIDIARY OF EATON VANCE MANAGEMENT ("EATON VANCE"), AS ITS INVESTMENT ADVISER.
TAX FREE RESERVES ENGAGES EATON VANCE AS ITS INVESTMENT ADVISER. EATON VANCE,
ITS AFFILIATES AND ITS PREDECESSOR COMPANIES HAVE BEEN MANAGING ASSETS OF
INDIVIDUALS AND INSTITUTIONS SINCE 1924 AND MANAGING INVESTMENT COMPANIES SINCE
1931.

Acting under the general supervision of the Board of Trustees of the
Portfolio, BMR manages the Portfolio's investments and affairs. Under its
investment advisory agreement with the Portfolio, BMR receives a monthly
advisory fee of 1/24 of 1% (equivalent to 0.50% annually) of the average daily
net assets of the Portfolio. For the period from the start of business, May 2,
1994, to December 31, 1994, the Portfolio paid BMR advisory fees equivalent to
0.50% (annualized) of the Portfolio's average daily net assets for such period.
BMR also furnishes for the use of the Portfolio office space and all necessary
office facilities, equipment and personnel for servicing the investments of the
Portfolio.

Eaton Vance, acting under the general supervision of the Trustees of Tax
Free Reserves, manages the Fund's investments and affairs. Under its investment
advisory agreement with Tax Free Reserves, Eaton Vance receives a monthly
advisory fee of 1/24 of 1% (equivalent to 0.50% annually) of average monthly net
assets of the Fund. Eaton Vance earned advisory fees of 0.50% of the Fund's
average monthly net assets for the fiscal year ended December 31, 1994. To
enhance the net income of the Fund, Eaton Vance reduced its fee by $162,287.
Eaton Vance also furnishes for the use of Tax Free Reserves office space and all
necessary office facilities, equipment and personnel for servicing the
investments of the Fund.

Money market instruments are often acquired directly from the issuers
thereof or otherwise are normally traded on a net basis (without commission)
through broker-dealers and banks acting for their own account. Such firms
attempt to profit from such transactions by buying at the bid price and selling
at the higher asked price of the market, and the difference is customarily
referred to as the spread. In selecting firms which will execute portfolio
transactions, BMR and Eaton Vance judge such executing firms' professional
ability and quality of service and use their best efforts to obtain execution at
prices which are advantageous and at reasonably competitive spreads. Subject to
the foregoing, BMR and Eaton Vance may consider sales of shares of the Funds or
of other investment companies sponsored by BMR or Eaton Vance as a factor in the
selection of firms to execute portfolio transactions.

Michael B. Terry has acted as the portfolio manager of the Portfolio since
it commenced operations. He has been a Vice President of Eaton Vance since 1984
and of BMR since 1992.

William H. Ahern has been an employee of Eaton Vance and has acted as the
portfolio manager of Tax Free Reserves since 1989. He has been an Assistant Vice
President of Eaton Vance since 1994.

BMR OR EATON VANCE ACTS AS INVESTMENT ADVISER TO INVESTMENT COMPANIES AND
VARIOUS INDIVIDUAL AND INSTITUTIONAL CLIENTS WITH ASSETS UNDER MANAGEMENT OF
APPROXIMATELY $15 BILLION. Eaton Vance is a wholly-owned subsidiary of Eaton
Vance Corp., a publicly-held holding company. Eaton Vance Corp., through its
subsidiaries and affiliates, engages in investment management and marketing
activities, fiduciary and banking services, oil and gas operations, real estate
investment, consulting and management and development of precious metals
properties. EVD is a wholly-owned subsidiary of Eaton Vance.

The Trustees of Cash Fund, Liquid Assets Fund and Money Market Fund have
retained the services of Eaton Vance to act as Administrator of such Funds. Such
Trustees have not retained the services of an investment adviser since each Fund
seeks to achieve its investment objective by investing in the Portfolio. As
Administrator, Eaton Vance provides each such Fund with general office
facilities and supervises the overall administration of the Funds. For these
services, Eaton Vance currently receives no compensation. The Trustees of the
Funds may determine, in the future, to compensate Eaton Vance for such services.

The Portfolio and the Funds, as the case may be, will each be responsible
for all of its respective costs and expenses not expressly stated to be payable
by BMR under the investment advisory agreement, by Eaton Vance under the
investment advisory or administrative services agreements, or by EVD under the
distribution agreements. Such costs and expenses to be borne by the Portfolio
and a Fund, as the case may be, include, without limitation: custody and
transfer agency fees and expenses, including those incurred for determining net
asset value and keeping accounting books and records; expenses of pricing and
valuation services; the cost of share certificates; membership dues in
investment company organizations; expenses of acquiring, holding and disposing
of securities and other investments; fees and expenses of registering under the
securities laws and governmental fees; expenses of reporting to shareholders and
investors; proxy statements and other expenses of shareholders' or investors'
meetings; insurance premiums; printing and mailing expenses; interest, taxes and
corporate fees; legal and accounting expenses; compensation and expenses of
Trustees not affiliated with BMR or Eaton Vance; and investment advisory fees
and, if any, administrative services fees. The Portfolio or a Fund, as the case
may be, will also each bear expenses incurred in connection with litigation in
which the Portfolio or a Fund, as the case may be, is a party and any legal
obligation to indemnify its respective officers and Trustees with respect
thereto.

DISTRIBUTION PLANS
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EATON VANCE MONEY MARKET FUND FINANCES DISTRIBUTION ACTIVITIES AND HAS ADOPTED A
DISTRIBUTION PLAN (THE "PLAN") PURSUANT TO RULE 12B-1 UNDER THE INVESTMENT
COMPANY ACT OF 1940. Rule 12b-1 permits a mutual fund, such as the Money Market
Fund, to finance distribution activities and bear expenses associated with the
distribution of its shares provided that any payments made by the Fund are made
pursuant to a written plan adopted in accordance with the Rule. The Plan is
subject to, and complies with, the sales charge rule of the National Association
of Securities Dealers, Inc. (the "NASD Rule"). The Plan is described further in
the Statement of Additional Information, and the following is a description of
the salient features of the Plan. The Plan provides that the Money Market Fund,
subject to the NASD Rule, will pay sales commissions and distribution fees to
the Principal Underwriter only after and as a result of the sale of shares of
the Fund. On each sale of Money Market Fund shares (excluding reinvestment of
distributions) the Fund will pay the Principal Underwriter amounts representing
(i) sales commissions equal to 6.25% of the amount received by the Fund for each
share sold and (ii) distribution fees calculated by applying the rate of 1% over
the prime rate then reported in The Wall Street Journal to the outstanding
balance of Uncovered Distribution Charges (as described below) of the Principal
Underwriter. The Principal Underwriter currently expects to pay sales
commissions (except on exchange transactions and reinvestments) to a financial
service firm (an "Authorized Firm") at the time of sale equal to 4% of the
purchase price of the shares sold by such Firm. The Principal Underwriter will
use its own funds (which may be borrowed from banks) to pay such commissions.
With respect to Money Market Fund shares acquired as a result of an exchange
from one or more funds in the Eaton Vance Classic Group of Funds, the Principal
Underwriter currently expects to pay monthly sales commissions to an Authorized
Firm approximately equivalent to 1/12 of .75% of the value of such shares sold
by such Firm and remaining outstanding for at least one year from the date of
original purchase of the EV Classic fund shares. Because the payment of the
sales commissions and distribution fees to the Principal Underwriter is subject
to the NASD Rule described below, it will take the Principal Underwriter a
number of years to recoup the sales commissions paid by it to Authorized Firms
from the payments received by it from the Fund pursuant to the Plan.

THE NASD RULE REQUIRES THE MONEY MARKET FUND TO LIMIT ITS ANNUAL PAYMENTS OF
SALES COMMISSIONS AND DISTRIBUTION FEES TO THE PRINCIPAL UNDERWRITER TO AN
AMOUNT NOT EXCEEDING .75% OF THE FUND'S AVERAGE DAILY NET ASSETS FOR EACH FISCAL
YEAR. Accordingly, the Money Market Fund accrues daily an amount at the rate of
1/365 of .75% of the Fund's net assets, and pays such accrued amounts monthly to
the Principal Underwriter. The Plan requires such accruals to be automatically
discontinued during any period in which there are no outstanding Uncovered
Distribution Charges under the Plan. Uncovered Distribution Charges are
calculated daily and, briefly, are equivalent to all unpaid sales commissions
and distribution fees to which the Principal Underwriter is entitled under the
Plan less all contingent deferred sales charges theretofore paid to the
Principal Underwriter. The Eaton Vance organization may be considered to have
realized a profit under the Plan if at any point in time the aggregate amounts
of all payments received by the Principal Underwriter from the Money Market Fund
pursuant to the Plan, including any contingent deferred sales charges, have
exceeded the total expenses theretofore incurred by such organization in
distributing shares of the Fund. Total expenses for this purpose will include an
allocable portion of the overhead costs of such organization and its branch
offices.

Because of the NASD Rule limitation on the amount of sales commissions and
distribution fees paid to the Principal Underwriter during any fiscal year, a
high level of sales of Money Market Fund shares during the initial years of the
Fund's operations would cause a large portion of the sales commissions
attributable to a sale of Fund shares to be accrued and paid by the Fund to the
Principal Underwriter in fiscal years subsequent to the year in which such
shares were sold. This spreading of sales commissions payments under the Plan
over an extended period would result in the incurrence and payment of increased
distribution fees under the Plan.

THE PLAN AUTHORIZES THE MONEY MARKET FUND TO MAKE PAYMENTS OF SERVICE FEES
TO THE PRINCIPAL UNDERWRITER, AUTHORIZED FIRMS AND OTHER PERSONS. THE AGGREGATE
OF SUCH PAYMENTS DURING ANY FISCAL YEAR OF THE MONEY MARKET FUND SHALL NOT
EXCEED .25% OF THE FUND'S AVERAGE DAILY NET ASSETS FOR SUCH YEAR. The Trustees
of Eaton Vance Liquid Assets Trust have initially implemented the Plan by
authorizing the Money Market Fund to pay service fees to the Principal
Underwriter and Authorized Firms in amounts up to .15% per annum of the Fund's
average daily net assets based on the value of Fund shares sold by such persons
and remaining outstanding for at least one year (including in such holding
period the prior holding of any EV Marathon or EV Classic fund shares exchanged
for Fund shares). However, the Plan authorizes the Trustees of such trust on
behalf of the Fund to increase payments to the Principal Underwriter, Authorized
Firms and other persons from time to time without further action by shareholders
of the Fund, provided that the aggregate amount of payments made to such persons
under the Plan in any fiscal year of the Fund does not exceed .25% of the Fund's
average daily net assets. As permitted by the NASD Rule, such payments are made
for personal services and/or the maintenance of shareholder accounts. Service
fees are separate and distinct from the sales commissions and distribution fees
payable by the Fund to the Principal Underwriter, and as such are not subject to
automatic discontinuance when there are no outstanding Uncovered Distribution
Charges of the Principal Underwriter. The Money Market Fund expects to begin
accruing for its service fee payments during the quarter ending June 30, 1995.

EATON VANCE LIQUID ASSETS FUND has also adopted a Distribution Plan pursuant
to Rule 12b-1 under the Investment Company Act of 1940, which is described in
its Statement of Additional Information. The Liquid Assets Plan authorizes
payments of service fees to the Principal Underwriter, Authorized Firms and
other persons. The aggregate of such payments during any fiscal year of the Fund
shall not exceed .25% of the Fund's average daily net assets for such year. The
Trustees have implemented the Plan by authorizing the Fund to pay service fees
to Authorized Firms in amounts up to .25% per annum of the Fund's average daily
net assets based on the value of Fund shares sold by such Firms and remaining
outstanding for at least one year. As permitted by the NASD Rule, such payments
are made for personal services and/or the maintenance of shareholder accounts.
For the fiscal year ended December 31, 1994 the Fund made payments under the
Plan to the Principal Underwriter and Authorized Firms equivalent to 0.05%
(annualized) of the Fund's average daily net assets for such period.

With respect to all Funds, the Principal Underwriter may, from time to time,
at its own expense, provide additional incentives to Authorized Firms which
employ registered representatives who sell a minimum dollar amount of a Fund's
shares and/or shares of other funds distributed by the Principal Underwriter. In
some instances, such additional incentives may be offered only to certain
Authorized Firms whose representatives are expected to sell significant amounts
of shares. In addition, the Principal Underwriter may from time to time increase
or decrease the sales commissions, if any, paid by it to Authorized Firms.

A Fund may, in its absolute discretion, suspend, discontinue or limit the
offering of its shares at any time. In determining whether any such action
should be taken, a Fund's management intends to consider all relevant factors,
including without limitation the size of the Fund, the investment climate and
market conditions, the volume of sales and redemptions of Fund shares. A
distribution plan may continue in effect and payments may be made under the plan
following any such suspension, discontinuance or limitation of the offering of
Fund shares; however, the Fund is not contractually obligated to continue the
plan for any particular period of time. Suspension of the offering of Fund
shares would not, of course, affect a shareholder's ability to redeem shares.

VALUING FUND SHARES
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EACH FUND VALUES ITS SHARES ONCE ON EACH DAY THE NEW YORK STOCK EXCHANGE (THE
"EXCHANGE") IS OPEN FOR TRADING, as of the close of regular trading on the
Exchange (normally 4:00 p.m. New York time). Each Fund's net asset value is
determined by its custodian, Investors Bank & Trust Company ("IBT"), (as agent
for the Fund) in the manner authorized by the Trustees of the relevant trust.
Net asset value per share is computed by dividing the value of a Fund's total
assets, less its liabilities, by the number of shares outstanding. For a Fund
that invests its assets in an interest in the Cash Management Portfolio, the
Fund's net asset value will reflect the value of its interest in the Portfolio
(which, in turn, reflects the underlying value of the Portfolio's assets and
liabilities). The Cash Management Portfolio's net asset value is also determined
as of the close of regular trading on the Exchange by IBT (as custodian and
agent for the Portfolio) in the manner authorized by the Trustees of the
Portfolio. Net asset value is computed by adding the value of all securities and
all other assets and subtracting liabilities. Eaton Vance Corp. owns 77.3% of
the outstanding stock of IBT, each Fund's and the Portfolio's custodian.

The investments of the Portfolio and of the Funds are valued at amortized
cost according to a Securities and Exchange Commission rule. The Portfolio and
the Funds will not normally have unrealized gains or losses so long as they
value their investments by the amortized cost method.

HOW TO BUY FUND SHARES
- ------------------------------------------------------------------------------

INVESTORS MAY PURCHASE SHARES OF A FUND THROUGH AUTHORIZED FIRMS AT THE NET
ASSET VALUE PER SHARE OF THE FUND NEXT DETERMINED AFTER AN ORDER IS EFFECTIVE.
An initial investment in a Fund must be at least $1,000. Once an account has
been established the investor may send investments of $50 or more at any time
directly to the Funds' Transfer Agent (the "Transfer Agent") as follows: The
Shareholder Services Group, Inc. BOS725, P.O. Box 1559, Boston, MA 02104. The
$1,000 minimum initial investment is waived for Bank Automated Investing
accounts, which may be established with an investment of $50 or more. See "Eaton
Vance Shareholder Services" below. Any Fund may suspend the offering of shares
at any time and may refuse an order for the purchase of shares. If you don't
have an Authorized Firm, Eaton Vance can recommend one.

BY MAIL: Initial Purchases -- The Account Application form which
accompanies this prospectus should be completed, signed and mailed with a
check, Federal Reserve Draft, or other negotiable bank draft, drawn on a U.S.
bank and payable in U.S. dollars, to the order of the relevant Fund and mailed
to:

The Shareholder Services Group, Inc.
BOS725
P.O. Box 1559
Boston, MA 02104

Subsequent Purchases -- Additional purchases may be made at any time by
mailing a check, Federal Reserve Draft, or other negotiable draft, drawn on a
U.S. bank and payable in U.S. dollars, to the order of the relevant Fund to the
Transfer Agent at the above address. The account to which the subsequent
purchase is to be credited should be identified as to the name(s) of the
registered owner(s) and by account number.

BY WIRE: Investors may purchase shares by requesting their bank to
transmit immediately available funds (Federal funds) by wire to:

ABA #011001438
Federal Reserve Bank of Boston A/C Investors Bank & Trust Company
Further Credit Eaton Vance [name of] Fund A/C # [Insert your account
number -- see below]

Initial Purchases -- Upon making an initial investment by wire, you must
first telephone the Order Department of the Funds 800-225-6265 (extension 3) to
advise of your action and to be assigned an account number. If you neglect to
make the telephone call, it may not be possible to process your order promptly.
In addition, the Account Application form which accompanies this prospectus
should be promptly forwarded to The Shareholder Services Group, Inc., at the
above address.

Subsequent Purchases -- Additional investments may be made at any time
through the wire procedure described above. The Funds' Order Department must be
immediately advised by telephone 800-225-6265 (extension 3) of each transmission
of funds by wire.

Transactions in money market instruments normally require immediate
settlement in Federal funds. The Funds intend at all times to be as fully
invested as is feasible in order to maximize earnings. Accordingly, purchase
orders will be executed at the net asset value next determined after their
receipt by a Fund only if the Fund has received payment in cash or in Federal
funds. If remitted in other than the foregoing manner, such as by money order or
personal check, purchase orders will be executed as of the close of business on
the second Boston business day after receipt. Information on how to procure a
Federal Reserve Draft or to transmit Federal funds by wire is available at
banks. A bank may charge for these services.

In connection with employee benefit or other continuous group purchase plans
under which the average initial purchase by a participant of the plan is $1,000
or more, the Cash and Money Market Funds may accept initial investments of less
than $1,000 on the part of an individual participant. In the event a shareholder
who is a participant of such a plan terminates participation in the plan, his or
her shares will be transferred to a regular individual account. However, such
account will be subject to the right of redemption by the Fund as described
below under "How to Redeem Fund Shares."

As of the date of this Prospectus, shares of Liquid Assets Fund were not
being offered.

HOW TO REDEEM FUND SHARES
- ------------------------------------------------------------------------------

A SHAREHOLDER MAY REDEEM A FUND'S SHARES BY DELIVERING TO THE SHAREHOLDER
SERVICES GROUP, INC., BOS725, P.O. BOX 1559, BOSTON, MASSACHUSETTS 02104, during
its business hours a written request for redemption in good order, plus any
executed stock powers. The redemption price will be based on the net asset value
per Fund share next computed after such delivery. Good order means that all
relevant documents must be endorsed by the record owner(s) exactly as the shares
are registered and the signature(s) must be guaranteed by a member of either the
Securities Transfer Association's STAMP program or the New York Stock Exchange's
Medallion Signature Program, or certain banks, savings and loan institutions,
credit unions, securities dealers, securities exchanges, clearing agencies and
registered securities associations as required by a regulation of the Securities
and Exchange Commission and acceptable to The Shareholder Services Group, Inc.
In addition, in some cases, good order may require the furnishing of additional
documents such as where shares are registered in the name of a corporation,
partnership or fiduciary.

Within seven days after receipt of a redemption request in good order by The
Shareholder Services Group, Inc., the relevant Fund will make payment in cash
for the net asset value of the redeemed shares as of the date determined above,
reduced by the amount of any applicable contingent deferred sales charges
(described below) and any Federal income tax required to be withheld. Although
each Fund normally expects to make payment in cash for redeemed shares, it has,
subject to compliance with applicable regulations, reserved the right to pay the
redemption price of shares of the Fund, either totally or partially, by a
distribution in kind of readily marketable securities (which for some Funds
would be withdrawn by it from the Portfolio). The securities so distributed
would be valued pursuant to the Portfolio's or Tax Free Reserves' valuation
procedures. If a shareholder received a distribution in kind, the shareholder
could incur brokerage or other charges in converting the securities to cash.

Shareholders who have given specific written authorization in advance (on a
form available from the Principal Underwriter) may request that redemption
proceeds of $1,000 or more be wired to a bank account. See "Eaton Vance
Shareholder Services -- Wire Transfer to a Bank Account" below.

To sell shares at their net asset value through an Authorized Firm (a
repurchase), a shareholder can place a repurchase order with the Authorized
Firm, which may charge a fee. The value of such shares is based upon the net
asset value calculated after EVD, as each Fund's agent, receives the order. It
is the Authorized Firm's responsibility to transmit promptly repurchase orders
to EVD. Throughout this Prospectus, the word "redemption" is generally meant to
include a repurchase.

If shares were recently purchased, the proceeds of redemption will not be
sent until the check (including a certified or cashier's check) received for the
shares purchased has cleared. Payment for shares tendered for redemption may be
delayed up to 15 days from the purchase date when the purchase check has not yet
cleared. If the net asset value of Fund shares is not maintained at $1.00 per
share or if a contingent deferred sales charge (described below) is imposed on
the redemption, a redemption may result in a taxable gain or loss.

Due to the high cost of maintaining small accounts, each Fund reserves the
right to redeem accounts with balances of less than $1,000. Prior to such a
redemption, shareholders will be given 60 days' written notice to make an
additional purchase. Thus, an investor making an initial investment of $1,000
would not be able to redeem shares without being subject to this policy.
However, no such redemption would be required by the Fund if the cause of the
low account balance was a reduction in the net asset value of Fund shares. No
contingent deferred sales charge will be imposed with respect to such
involuntary redemptions.

CONTINGENT DEFERRED SALES CHARGE -- CASH FUND AND TAX FREE RESERVES. Shares of
the Fund acquired in an exchange for shares of an Eaton Vance Traditional Fund
subject to a contingent deferred sales charge will be subject to a 1% charge if
redeemed within 18 months following the original investment unless such
redemption is in connection with another exchange for shares subject to such a
charge.

CONTINGENT DEFERRED SALES CHARGE -- LIQUID ASSETS AND MONEY MARKET FUNDS. Shares
redeemed within the first six years of their purchase (except shares acquired
through the reinvestment of distributions) generally will be subject to a
contingent deferred sales charge. This contingent deferred sales charge is
imposed on any redemption the amount of which exceeds the aggregate value at the
time of redemption of (a) all shares in the account purchased more than six
years prior to the redemption, (b) all shares in the account acquired through
reinvestment of distributions, and (c) the increase, if any, in value of all
other shares in the account (namely those purchased within the six years
preceding the redemption) over the purchase price of such shares. Redemptions
are processed in a manner to maximize the amount of redemption proceeds which
will not be subject to a contingent deferred sales charge. That is, each
redemption will be assumed to have been made first from the exempt amounts
referred to in clauses (a), (b) and (c) above, and second through liquidation of
those shares in the account referred to in clause (c) on a first-in-first-out
basis. Any contingent deferred sales charge which is required to be imposed on
share redemptions will be made in accordance with the following schedule:

YEAR OF CONTINGENT
REDEMPTION DEFERRED SALES
AFTER PURCHASE CHARGE
-------------- --------------
First ............................................... 5%*
Second .............................................. 5%
Third ............................................... 4%
Fourth .............................................. 3%
Fifth ............................................... 2%
Sixth ............................................... 1%
Seventh and following ............................... 0%
*For shares originally purchased prior to August 1, 1994, the contingent
deferred sales charge for redemptions within the first year after purchase
is 6%.

In calculating the contingent deferred sales charge upon the redemption of
Liquid Assets or Money Market Fund shares acquired in an exchange for shares of
a fund in the Eaton Vance Marathon Group of Funds or the Eaton Vance Classic
Group of Funds (see "The Eaton Vance Exchange Privilege" below), the contingent
deferred sales charge schedule applicable to the shares at the time of purchase
will apply and the purchase of Fund shares acquired in the exchange is deemed to
have occurred at the time of the original purchase of the exchanged shares. See
"The Eaton Vance Exchange Privilege" for the contingent deferred sales charge
schedules applicable to Fund shares acquired in an exchange.

No contingent deferred sales charge will be imposed on any Fund's shares
which have been sold to Eaton Vance or its affiliates, or to their respective
employees or clients. The contingent deferred sales charge will also be waived
for shares redeemed (1) pursuant to a Withdrawal Plan (see "Eaton Vance
Shareholder Services"), (2) as part of a required distribution from a
tax-sheltered retirement plan or (3) following the death of all beneficial
owners of such shares, provided the redemption is requested within one year of
death (a death certificate and other applicable documents may be required). The
contingent deferred sales charge will be paid to the Principal Underwriter or
the relevant Fund.

THE FOLLOWING EXAMPLE ILLUSTRATES THE OPERATION OF THE CONTINGENT DEFERRED
SALES CHARGE. ASSUME THAT AN INVESTOR PURCHASES $10,000 OF THE MONEY MARKET
FUND'S SHARES AND THAT 25 MONTHS LATER THE VALUE OF THE ACCOUNT HAS GROWN
THROUGH THE REINVESTMENT OF DIVIDENDS TO $11,000. THE INVESTOR THEN MAY
REDEEM UP TO $1,000 OF SHARES WITHOUT INCURRING A CONTINGENT DEFERRED SALES
CHARGE. IF THE INVESTOR SHOULD REDEEM $2,000 OF SHARES, A CONTINGENT
DEFERRED SALES CHARGE WOULD BE IMPOSED ON $1,000 OF THE REDEMPTION. THE
RATE WOULD BE 4% BECAUSE THE REDEMPTION WAS MADE IN THE THIRD YEAR AFTER
THE PURCHASE WAS MADE AND THE CHARGE WOULD BE $40.

REPORTS TO SHAREHOLDERS
- ------------------------------------------------------------------------------

EACH FUND WILL ISSUE TO ITS SHAREHOLDERS SEMI-ANNUAL AND ANNUAL REPORTS
CONTAINING FINANCIAL STATEMENTS. Financial statements included in annual reports
are audited by the Fund's independent accountants. Shortly after the end of each
calendar year, each Fund will furnish its shareholders with information
necessary for preparing Federal and state tax returns.

THE LIFETIME INVESTING ACCOUNT/DISTRIBUTION OPTIONS
- ------------------------------------------------------------------------------

AFTER AN INVESTOR MAKES AN INITIAL PURCHASE OF FUND SHARES, THE FUNDS' TRANSFER
AGENT, THE SHAREHOLDER SERVICES GROUP, INC., WILL SET UP A LIFETIME INVESTING
ACCOUNT FOR THE INVESTOR ON THE FUND'S RECORDS. This account is a complete
record of all transactions between the investor and the Fund which at all times
shows the balance of shares owned. All shares are held in non-certificate form
by the Funds' Transfer Agent for the account of the shareholder, and the Fund
will not issue share certificates.

At least quarterly, shareholders will receive a statement showing complete
details of any transaction and the current share balance in the account. THE
LIFETIME INVESTING ACCOUNT ALSO PERMITS A SHAREHOLDER TO MAKE ADDITIONAL
INVESTMENTS IN SHARES BY SENDING A CHECK FOR $50 OR MORE to The Shareholder
Services Group, Inc.

Any questions concerning a shareholder's account or services available may
be directed by telephone to EATON VANCE SHAREHOLDER SERVICES at 800-225-6265
extension 2, or in writing to The Shareholder Services Group, Inc., BOS725, P.O.
Box 1559, Boston, MA 02104 (please provide the name of the shareholder, the Fund
and the account number).

THE FOLLOWING DISTRIBUTION OPTIONS WILL BE AVAILABLE TO ALL LIFETIME
INVESTING ACCOUNTS and may be changed as often as desired by written notice to
the Funds' dividend disbursing agent, The Shareholder Services Group. Inc.,
BOS725, P.O. Box 1559, Boston, MA 02104. The currently effective option will
appear on each account statement.

Share Option -- All distributions will be reinvested in additional shares.

Cash Option -- All distributions will be paid in cash.

The Share Option will be assigned if no other option is specified.
Distributions, including those reinvested, will be reduced by any withholding
required under Federal income tax laws.

If the Cash Option has been selected, distribution checks which are returned
by the United States Postal Service as not deliverable or which remain uncashed
for six months or more will be reinvested in the account in shares at the then
current net asset value. Furthermore, the distribution option on the account
will be automatically changed to the Share Option until such time as the
shareholder selects a different option.

DISTRIBUTION INVESTMENT OPTION. In addition to the distribution options set
forth above, distributions may be invested in additional shares of another Eaton
Vance fund. Before selecting this option, a shareholder should obtain a
prospectus of the other Eaton Vance fund and consider its objectives and
policies carefully.

"STREET NAME" ACCOUNTS. If shares of a Fund are held in a "street name" account
with an Authorized Firm, all recordkeeping, transaction processing and payments
of distributions relating to the beneficial owner's account will be performed by
the Authorized Firm, and not by the Fund and its Transfer Agent. Since the Fund
will have no record of the beneficial owner's transactions, a beneficial owner
should contact the Authorized Firm to purchase, redeem or exchange shares, to
make changes in or give instructions concerning the account, or to obtain
information about the account. The transfer of shares in a "street name" account
to an account with another dealer or to an account directly with the Fund
involves special procedures and will require the beneficial owner to obtain
historical purchase information about the shares in the account from the
Authorized Firm. Before establishing a "street name" account with an investment
firm, or transferring the account to another investment firm, an investor
wishing to reinvest distributions should determine whether the firm which will
hold the shares allows reinvestment of distributions in "street name" accounts.

UNDER A LIFETIME INVESTING ACCOUNT A SHAREHOLDER CAN MAKE ADDITIONAL
INVESTMENTS IN SHARES OF A FUND BY SENDING A CHECK FOR $50 OR MORE.

THE EATON VANCE EXCHANGE PRIVILEGE
- ------------------------------------------------------------------------------

Shares of CASH FUND and TAX FREE RESERVES currently may be exchanged for shares
of any fund in the Eaton Vance Traditional Group of Funds and Eaton Vance
Short-Term Treasury Fund. Shares of Cash Fund or Tax Free Reserves acquired
under the exchange privilege which have not previously been subject to payment
of a sales charge may be exchanged for shares of a Fund with a sales charge only
upon payment of the appropriate charge. These offers are available only in
states where shares of the fund being acquired may legally be sold.

LIQUID ASSETS and MONEY MARKET FUND shares currently may be exchanged for
shares of one or more funds in the Eaton Vance Marathon Group of Funds
(currently Eaton Vance Equity-Income Trust and any of the EV Marathon funds)
which are distributed with a contingent deferred sales charge. Only shares
subject to a contingent deferred sales charge schedule equal to that of Eaton
Vance Prime Rate Reserves, EV Marathon Strategic Income Fund or an EV Marathon
Limited Maturity Tax Free Fund (Class I), or shares not subject to such a
charge, may be exchanged from either Fund to Eaton Vance Prime Rate Reserves. If
Fund shares were acquired in exchange for shares of one or more funds in the
Eaton Vance Classic Group of Funds, such shares may be exchanged only for shares
of one or more funds in the Eaton Vance Classic Group of Funds. Exchanges are
made on the basis of the net asset value per share of each fund at the time of
the exchange, provided that such offers are available only in states where
shares of the fund being acquired may be legally sold.

Each exchange must involve shares which have a net asset value of at least
$1,000. The exchange privilege may be changed or discontinued without penalty.
Shareholders will be given sixty (60) days' notice prior to any termination or
material amendment of the exchange privilege. The Funds do not permit the
exchange privilege to be used for "Market Timing" and may terminate the exchange
privilege for any shareholder account engaged in Market Timing activity. Any
shareholder account for which more than two round-trip exchanges are made within
any twelve month period will be deemed to be engaged in Market Timing.
Furthermore, a group of unrelated accounts for which exchanges are entered
contemporaneously by a financial intermediary will be considered to be engaged
in Market Timing.

The Shareholder Services Group, Inc. makes exchanges at the next determined
net asset value after receiving an exchange request in good order (see "How to
Redeem Fund Shares"). The Shareholder Services Group, Inc. may require
additional documentation if shares are registered in the name of a corporation,
partnership or fiduciary. Applications and prospectuses of the other funds are
available from Authorized Firms or the Principal Underwriter. The prospectus for
each fund describes its investment objectives and policies and shareholders
should obtain a prospectus and consider these objectives and policies carefully
before requesting an exchange.

No contingent deferred sales charge is imposed on exchanges. For purposes of
calculating the contingent deferred sales charge upon the redemption of Fund
shares acquired in an exchange, the purchase of shares acquired in one or more
exchanges is deemed to have occurred at the time of the original purchase of the
exchanged shares. Cash Fund or Tax Free Reserves shares acquired in an exchange
for EV Traditional fund shares subject to a contingent deferred sales charge if
redeemed within 18 months following the original investment will remain subject
to such charge. Liquid Assets and Money Market Fund shares acquired as the
result of an exchange from an EV Marathon fund will be subject to the contingent
deferred sales charge schedule set forth under "How to Redeem Fund Shares"
above, except Fund shares acquired as the result of an exchange from an EV
Marathon Limited Maturity Tax Free fund which shares will be subject to a
declining contingent deferred sales charge of 3.0%-0%. Fund shares acquired as
the result of an exchange from an EV Classic fund will be subject to a
contingent deferred sales charge of 1% in the event of redemption within one
year from the date of their original purchase, except those shares purchased
prior to January 30, 1995, which will not be subject to any such charge.

Shares of the funds in the Eaton Vance Marathon and Eaton Vance Classic
Groups of Funds may be exchanged for Money Market Fund shares on the basis of
the net asset value per share of each fund at the time of the exchange, but
subject to any restrictions or qualifications set forth in the current
prospectus of any such fund.

Telephone exchanges are accepted by The Shareholder Services Group, Inc.,
provided the investor has not disclaimed in writing the use of the privilege. To
effect such exchanges, call The Shareholder Services Group, Inc. at 800-
262-1122 or, within Massachusetts, 617-573-9403 Monday through Friday, 9:00 a.m.
to 4:00 p.m. (Eastern Standard Time). Shares acquired by telephone exchange must
be registered in the same name(s) and with the same address as the shares being
exchanged. Neither a Fund, the Principal Underwriter nor The Shareholder
Services Group, Inc. will be responsible for the authenticity of exchange
instructions received by telephone; provided that reasonable procedures to
confirm that instructions communicated are genuine have been followed. Telephone
instructions will be tape recorded. In times of drastic economic or market
changes, a telephone exchange may be difficult to implement. As long as the net
asset value of Fund shares is maintained at $1.00 per share, an exchange will
not result in a taxable gain or loss.

EATON VANCE SHAREHOLDER SERVICES
- ------------------------------------------------------------------------------

THE FUNDS OFFER THE FOLLOWING SERVICES, WHICH ARE VOLUNTARY, INVOLVE NO EXTRA
CHARGE, AND MAY BE CHANGED OR DISCONTINUED WITHOUT PENALTY AT ANY TIME. Full
information on each of the services described below and an application, where
required, are available from Authorized Firms or the Principal Underwriter. The
cost of administering such services for the benefit of shareholders who
participate in them is borne by the Funds as an expense to all shareholders.

INVEST-BY-MAIL -- FOR PERIODIC SHARE ACCUMULATION: Once the $1,000 minimum
investment has been made, checks of $50 or more payable to the order of the same
Fund may be mailed directly to The Shareholder Services Group, Inc., BOS725,
P.O. Box 1559, Boston, MA 02104 at any time -- whether or not distributions are
reinvested. The name of the shareholder, the Fund and the account number should
accompany each investment.

BANK AUTOMATED INVESTING -- FOR REGULAR SHARE ACCUMULATION: Cash investments of
$50 or more may be made automatically each month or quarter from a shareholder's
bank account. The $1,000 minimum initial investment and small account redemption
policy are waived for these accounts.

WITHDRAWAL PLAN: A shareholder may draw on shareholdings systematically with
monthly or quarterly checks in any amount, except for the Liquid Assets and
Money Market Funds which aggregate amount must not exceed annually 12% of the
account balance at the time the Plan is established. (Such amount will not be
subject to a contingent deferred sales charge.) See "How to Redeem Fund Shares".

REINVESTMENT PRIVILEGE -- A SHAREHOLDER WHO HAS REPURCHASED OR REDEEMED SHARES
MAY REINVEST, WITH CREDIT FOR ANY CONTINGENT DEFERRED SALES CHARGES PAID ON THE
REDEEMED OR REPURCHASED SHARES, ANY PORTION OR ALL OF THE REDEMPTION OR
REPURCHASE PROCEEDS (PLUS THAT AMOUNT NECESSARY TO ACQUIRE A FRACTIONAL SHARE TO
ROUND OFF THE PURCHASE TO THE NEAREST FULL SHARE) IN SHARES OF THE SAME FUND,
provided that the reinvestment is effected within 30 days after such redemption
or repurchase. Shares are sold to a reinvesting shareholder at the next
determined net asset value following timely receipt of a written purchase order
by the Principal Underwriter or by the Fund (or by the Funds' Transfer Agent).
To the extent that any shares of the Fund are sold at a loss and the proceeds
are reinvested in Fund shares (or other Fund shares are acquired within the
period beginning 30 days before and ending 30 days after the date of redemption)
some or all of the loss generally will not be allowed as a tax deduction.
Shareholders should consult their tax advisers concerning the tax consequences
of reinvestments.

CHECKWRITING: Shareholders of Cash Fund and Tax Free Reserves may appoint Boston
Safe Deposit and Trust Company ("Boston Safe") their agent and may request on
the appropriate Account Application form that Boston Safe provide them with
special forms of checks drawn on Boston Safe. These checks may be made payable
by the shareholder to the order of any person in any amount of $500 or more.
When a check is presented to Boston Safe for payment, the number of full and
fractional shares required to cover the amount of the check will be redeemed
from the shareholder's account by Boston Safe as the shareholder's agent.
Through this procedure the shareholder will continue to be entitled to
distributions paid on shares up to the time the check is presented to Boston
Safe for payment. If the amount of the check is greater than the value of the
shares held in the shareholder's account for which the Fund has collected
payment, the check will be returned and the shareholder may be subject to extra
charges. The shareholder will be required to execute signature cards and will be
subject to Boston Safe's rules and regulations governing such checking accounts.
There is no charge to shareholders for this service. This service may be
terminated or suspended at any time by a Fund or Boston Safe.

WIRE TRANSFER TO A BANK ACCOUNT: Shareholders who have given specific written
authorization in advance (on a form available from the Principal Underwriter)
may request that redemption proceeds of $1,000 or more be wired directly to
their bank account. The request may be made by letter or telephone to The
Shareholder Services Group, Inc. at 800-262-1122. To use this service a
shareholder must designate a bank and bank account number on the form used to
establish this service. The bank designated may be any bank in the United
States.

Redemption proceeds, less any applicable contingent deferred sales charge
and the amount of any Federal income tax required to be withheld, will be wired
on the next business day following receipt of the redemption request. The
shareholder will be required to pay any costs of such transaction. A Fund may
limit this method of payment to shares purchased with cash, Federal Reserve
Draft or by wire with Federal funds. Each Fund reserves the right at any time to
suspend or terminate this wire transfer procedure. No Fund will be responsible
for the authenticity of redemption instructions received by telephone; provided
that reasonable procedures to confirm that instructions communicated are genuine
have been followed. Telephone instructions will be tape recorded. In times of
drastic economic or market changes, a telephone redemption may be difficult to
implement.

TAX-SHELTERED RETIREMENT PLANS -- Shares of the Cash and Money Market Funds are
available for purchase in connection with the following tax-sheltered retirement
plans:

-- Pension and Profit Sharing Plans for self-employed individuals,
corporations and non-profit organizations;

-- Individual Retirement Account Plans for individuals and their non-
employed spouses; and

-- 403(b) Retirement Plans for employees of public school systems,
hospitals, colleges and other non-profit organizations meeting certain
requirements of the Internal Revenue Code of 1986, as amended (the
"Code").

Detailed information concerning these plans, including certain exceptions to
minimum investment requirements, and copies of the plans are available from the
Principal Underwriter. This information should be read carefully and
consultation with an attorney or tax adviser may be advisable. The information
sets forth the service fee charged for retirement plans and describes the
Federal income tax consequences of establishing a plan. Under all plans,
dividends and distributions will be automatically reinvested in additional
shares.

DISTRIBUTIONS AND TAXES
- ------------------------------------------------------------------------------

EACH FUND DECLARES DIVIDENDS DAILY AND PAYS DIVIDENDS MONTHLY FROM ITS NET
INVESTMENT INCOME. The net investment income of each of Cash, Liquid Assets and
Money Market Fund consists of net investment income allocated to the Fund by the
Portfolio, less the Fund's direct and allocated expenses. Long-term capital
gains, if any, allocated to a Fund will be distributed at least annually.

Each Fund intends to qualify as a regulated investment company under the
Code, and to satisfy all requirements necessary to be relieved of federal taxes
on income and gains it distributes to shareholders. As a partnership for federal
tax purposes, the Portfolio does not pay federal taxes. Each Fund will
distribute substantially all of its ordinary income and capital gain net income
on a current basis.

All distributions from Cash, Liquid Assets and Money Market Fund (and
taxable distributions from Tax Free Reserves, if any) are taxable to
shareholders as ordinary income, except that distributions of net long-term
capital gains, if any, are taxable to shareholders as such regardless of the
length of time the shareholder has held the shares. Distributions will be
taxable as described whether received in cash or as additional shares through
reinvestment in a Fund.

Each Fund will provide its shareholders annually with tax information
notices and Forms 1099 to assist in the preparation of their Federal and state
tax returns for the prior calendar year's distributions, proceeds from the
redemption or exchange of a Fund shares, and Federal income tax (if any)
withheld by the Funds' Transfer Agent. Shareholders should consult their tax
advisers about the effect of Fund distributions on their particular tax status
and any state or local taxes that may apply.

TAX FREE RESERVES. Distributions designated by Tax Free Reserves as "exempt-
interest dividends" may be excluded from shareholders' gross income for federal
income tax purposes. Exempt interest dividends are includable in the tax base
for shareholders who receive social security or railroad retirement benefits and
may affect the taxability of such benefits. In addition, exempt interest
dividends generally constitute a tax preference item under the federal
alternative minimum tax provisions and may be taxable for state and local tax
purposes.

Other distributions from Tax Free Reserves may be taxable to shareholders as
ordinary income or long-term capital gains. Distributions of income from
repurchase agreements, original issue discount and certain market discount will
be taxable to shareholders as ordinary income. However, the Fund's taxable
distributions, if any, will be insubstantial compared to exempt interest
dividends.

Shareholders should consult their own tax advisers to determine the effect
of exempt interest dividends on their particular tax situation, including
liability for state and local taxes. The Fund will report annually to
shareholders with respect to net tax exempt income earned in each state.

AS A REGULATED INVESTMENT COMPANY UNDER THE CODE, A FUND DOES NOT PAY
FEDERAL INCOME OR EXCISE TAXES TO THE EXTENT THAT IT DISTRIBUTES TO
SHAREHOLDERS ITS NET INVESTMENT INCOME AND NET REALIZED CAPITAL GAINS IN
ACCORDANCE WITH THE TIMING REQUIREMENTS IMPOSED BY THE CODE. AS A
PARTNERSHIP UNDER THE CODE, THE PORTFOLIO DOES NOT PAY FEDERAL INCOME OR
EXCISE TAXES.

YIELD INFORMATION
- ------------------------------------------------------------------------------

FROM TIME TO TIME A FUND MAY ADVERTISE ITS "YIELD" AND "EFFECTIVE YIELD." Both
yield figures are based on historical earnings and are not intended to indicate
future performance. The "yield" of a Fund refers to the income generated by an
investment in the Fund over a seven-day period (which period will be stated in
the advertisement). This income is then "annualized." That is, the amount of
income generated by the investment during that week is assumed to be generated
each week over a 52-week 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 the Fund is assumed to be reinvested. The "effective
yield" will be slightly higher than the "yield" because of the compounding
effect of this assumed reinvestment. A taxable-equivalent yield is computed by
using the tax-exempt yield figure and dividing by 1 minus the tax rate.

<PAGE>
INVESTMENT ADVISERS AND
ADMINISTRATOR
Boston Management and Research
Eaton Vance Management
24 Federal Street
Boston, MA 02110

PRINCIPAL UNDERWRITER
Eaton Vance Distributors, Inc.
24 Federal Street
Boston, MA 02110
(800) 225-6265

CUSTODIAN
Investors Bank & Trust Company
24 Federal Street
Boston, MA 02110

TRANSFER AGENT
The Shareholder Services Group, Inc.
BOS725
P.O. Box 1559
Boston, MA 02104
(800) 262-1122

INDEPENDENT ACCOUNTANTS
Coopers & Lybrand L.L.P.
One Post Office Square
Boston, MA 02109

THE EV MONEY MARKET FUNDS
24 FEDERAL STREET
BOSTON, MA 02110

MMFP

THE EV
MONEY MARKET
FUNDS

* Eaton Vance Cash Management Fund
* Eaton Vance Liquid Assets Fund
* Eaton Vance Money Market Fund
* Eaton Vance Tax Free Reserves

PROSPECTUS
MAY 1, 1995
<PAGE>

PART B
INFORMATION REQUIRED IN A STATEMENT OF ADDITIONAL INFORMATION

STATEMENT OF
ADDITIONAL INFORMATION
May 1, 1995

EATON VANCE TAX FREE RESERVES
24 Federal Street
Boston, Massachusetts 02110
(800) 225-6265

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

TABLE OF CONTENTS Page
General Information and History ................................ 2
Investment Objective, Policies and Restrictions ................ 2
Officers and Trustees of the Fund .............................. 4
Control Persons and Principal Holders of Securities ............ 5
Investment Adviser ............................................. 6
Custodian ...................................................... 7
Portfolio Security Transactions ................................ 8
Service for Withdrawal ......................................... 9
Determination of Net Asset Value ............................... 9
Taxes .......................................................... 10
Principal Underwriter .......................................... 11
Other Information .............................................. 11
Calculation of Yield Quotations ................................ 12
Independent Accountants ........................................ 13
Financial Statements ........................................... 13
Appendix ....................................................... 14
- --------------------------------------------------------------------------------

THIS STATEMENT OF ADDITIONAL INFORMATION IS NOT A PROSPECTUS AND IS
AUTHORIZED FOR DISTRIBUTION TO PROSPECTIVE INVESTORS ONLY IF PRECEDED OR
ACCOMPANIED BY THE CURRENT PROSPECTUS OF EATON VANCE TAX FREE RESERVES (THE
"FUND") DATED MAY 1, 1995, AS SUPPLEMENTED FROM TIME TO TIME. THIS STATEMENT OF
ADDITIONAL INFORMATION SHOULD BE READ IN CONJUNCTION WITH SUCH PROSPECTUS, A
COPY OF WHICH MAY BE OBTAINED WITHOUT CHARGE BY CONTACTING THE PRINCIPAL
UNDERWRITER (SEE BACK COVER FOR ADDRESS AND PHONE NUMBER).
<PAGE>
GENERAL INFORMATION AND HISTORY

Eaton Vance Tax Free Reserves (the "Fund") is a Massachusetts business
trust established under Massachusetts law by a Declaration of Trust dated July
15, 1981. The Fund's investment adviser is Eaton Vance Management ("Eaton Vance"
or the "Investment Adviser"), a Massachusetts business trust, Eaton Vance is a
wholly-owned subsidiary of Eaton Vance Corp. ("EVC").

INVESTMENT OBJECTIVE, POLICIES AND RESTRICTIONS

The investment objectives of the Fund are to provide investors with
liquidity and safety of principal and at the same time as high a level of income
exempt from regular Federal income tax as is consistent with such objectives.
The Fund will attempt to safeguard principal through investment emphasis on high
quality securities and through diversification.

The Fund will seek to achieve its objective by investing in a diversified
portfolio of obligations, including bonds, issued by or on behalf of states,
territories and possessions of the United States and their political
subdivisions, agencies and instrumentalities, and the District of Columbia, the
interest from which is exempt from regular Federal income tax. The Fund will
invest only in those obligations determined by the Trustees to present minimal
credit risks and which are at the time of acquisition rated by the requisite
number of nationally recognized statistical rating organizations in one of the
two highest applicable rating categories or, in the case of an instrument not so
rated of comparable quality as determined by the Trustees.

It is contemplated that the Fund's assets will consist principally of the
following:

(1) Floating or variable rate tax-exempt instruments, which provide for
interest rate adjustments at specified intervals. Rate adjustments on such
securities are usually set at the issuer's discretion, in which case the Fund
would normally have the right to resell the security to the issuer or its agent.
Alternatively, rate revisions may be determined in accordance with a prescribed
formula or other contractual procedure. The Fund may also acquire put options in
combination with the purchase of underlying securities. Such put options would
give the Fund the right to require the issuer or some other person to purchase
the underlying security at an agreed upon price. Interest income generated by
certain securities on which the Fund holds a put option may not qualify as
tax-exempt interest.

(2) Tax-exempt notes which are rated at the time of purchase within the
highest grade assigned by Moody's Investors Service, Inc. ("Moody's") (MIG-1),
or within the highest grade assigned by Standard & Poor's Ratings Group ("S&P")
(SP-1), or within the highest grade assigned by Fitch Investors Service, Inc.
("Fitch") (FIN-1).

(3) Project Notes, which are instruments sold by the Department of Housing
and Urban Development but issued by a state or local housing agency, and secured
by the full faith and credit of the United States. Due to changes in the Federal
income tax law enacted in the Deficit Reduction Act of 1984, Project Notes
issued on or after June 19, 1984 must satisfy several new requirements to
maintain their tax-exempt status.

(4) Tax-exempt bonds which are rated at the time of purchase within the two
highest grades assigned by Moody's (Aaa or Aa) or S&P (AAA or AA) or Fitch (AAA
or AA).

(5) Tax-exempt commercial paper rated in the highest grade by such rating
services (Prime-1 or A-1 or F-1+, respectively).

(6) Cash.

For a description of the instruments and ratings listed above, see the
Appendix.

The Fund anticipates being at all times as fully invested as possible in
tax-exempt bonds and notes; however, there may be occasions when, as a result of
maturities of portfolio securities or sales of Fund shares or in order to meet
anticipated redemption requests, or the unavailability of suitable tax-exempt
investments, the Fund may hold cash which is not earning income or invest in
taxable short-term obligations including U.S. Government obligations,
interest-bearing obligations of banks (such as certificates of deposit and
bankers' acceptances), repurchase agreements (see the Appendix for description
of risk), and commercial paper.

With respect to 10% of its net assets, the Fund may also purchase shares of
unaffiliated investment companies consistent with the restrictions of the
Investment Company Act of 1940, as amended. Such investments are subject to
adverse developments affecting the mutual fund industry. In addition, investors
indirectly pay the fees of two investment company service providers.

To facilitate the objective of a stable net asset value, the Fund intends to
limit its portfolio to instruments maturing in 397 calendar days or less from
the date of purchase and to maintain a dollar-weighted average portfolio
maturity of not more than 90 days. For the purpose of complying with these
limitations, the maturity of the Fund's portfolio instruments will be governed
by Rule 2a-7 promulgated under the Investment Company Act of 1940. See "How the
Fund Values Its Shares" in the current prospectus of the Fund.

Some tax-exempt securities may be purchased on a "when-issued" basis. If so,
the Fund generally will not pay for the securities or start earning interest on
them until the securities are received, which may take as long as 45 days. In
order to invest its assets immediately, while awaiting delivery of securities
purchased on a when-issued basis, the Fund will normally attempt to invest in
high-grade short-term debt securities that offer same-day settlement and
earnings. The commitment to purchase a security for which payment is not made at
that time may be deemed a separate security. The value of the when-issued
securities on the delivery date may be less than their cost, effecting an
immediate loss to the Fund. Thus, the purchase of securities on a when-issued
basis may be considered an aggressive investment practice involving some risk.
The Fund does not intend to make such commitments for speculative purposes, but
only to accomplish the goal of the Fund, i.e., to invest in tax-exempt
securities. When the Fund commits to purchase a security on a when-issued
basis, it will set up procedures consistent with the General Statement of Policy
of the Securities and Exchange Commission concerning such purchases. Since the
Policy currently recommends that assets of the Fund equal to the amount of the
purchase be held aside or segregated to be used to pay for the commitment, the
Fund will always have cash or high-grade short-term debt securities sufficient
to cover its commitments. If the Fund determines it is necessary to sell the
when-issued security before delivery, any gain or loss will not be tax-exempt.
The Fund has no specific limit on the amount of securities which may be
purchased on a when-issued basis.

The Fund may acquire "stand-by commitments" with respect to portfolio
obligations. Under a stand-by commitment, the Fund obligates a broker, dealer or
bank to repurchase, at the Fund's option, specified securities at a specified
price and, in this respect, stand-by commitments are comparable to put options.
The exercise of a stand-by commitment therefore is subject to the ability of the
seller to make payment on demand. The Fund will acquire stand-by commitments
solely to facilitate portfolio liquidity and does not intend to exercise its
rights thereunder for trading purposes. The Fund may pay for stand-by
commitments if such action is deemed necessary, thus increasing to a degree the
cost of the underlying obligation and similarly decreasing such security's yield
to investors.

The Fund may purchase securities at a price which would result in a yield to
maturity lower than that generally offered by the seller at the time of purchase
when the Fund can simultaneously acquire the right to sell the securities back
to the issuer or its agent at an agreed-upon price at any time during a
specified period or on a certain date. Such a right is generally known as a
"put."

The following investment restrictions have been adopted by the Fund and may
be changed only by the vote of a majority of the Fund's outstanding voting
securities as defined in the Investment Company Act of 1940.

As a matter of fundamental investment policy, the Fund may not:

(1) With respect to 75% of its total assets, invest more than 5% of the
value of its total assets in the securities of any one issuer, except for
obligations issued or guaranteed by the United States Government, its agencies
or instrumentalities and except securities of other investment companies;

(2) Borrow money or issue senior securities except as permitted by the
Investment Company Act of 1940;

(3) Purchase securities on margin;

(4) Underwrite securities issued by other persons;

(5) Buy or sell real estate, although it may purchase and sell securities
which are secured by real estate and securities of companies which invest or
deal in real estate, physical commodities, or commodity contracts relating to
physical commodities unless acquired as a result of ownership of securities;

(6) Make loans, except by (a) the purchase of debt instruments and making
portfolio investments, (b) entering into repurchase agreements or (c) lending
portfolio securities;

(7) Purchase any securities which would cause more than 25% of the value of
its total assets at the time of such purchase to be invested in the securities
of issuers having their principal business activities in the same industry,
provided that there is no limitation in respect to investments in tax-exempt
notes or bonds or other obligations issued or guaranteed by the U.S. Government
or its agencies or instrumentalities, or in certificates of deposit or bankers'
acceptances; or

(8) Purchase any securities which would cause more than 20% of the value of
its total assets at the time of such purchase to be invested in securities the
interest on which is not exempt from Federal income tax.

Notwithstanding the investment policies and restrictions of the Fund, the
Fund may invest all of its investable assets in an open-end management
investment company with substantially the same investment objective, policies
and restrictions as the Fund.

The Fund has adopted the following nonfundamental investment policies which
may be changed by the Trustees of the Fund without approval by the Fund's
shareholders. As a matter of nonfundamental investment policy, the Fund may not:
(a) purchase or retain securities of any issuer if 5% of the issuer's securities
are owned by those officers and Trustees of the Fund or officers and trustees of
its investment adviser who own individually more than 1/2 of 1% of the issuer's
securities; (b) make short sales except where, because of the ownership of other
securities, it has the right to obtain securities equivalent in kind and amount
to those sold; write or purchase or sell any put or call options or combinations
thereof, except that if may acquire rights to resell tax-exempt securities at an
agreed upon price and at or within an agreed upon time; (c) purchase warrants;
or (d) more than 10% of net assets in investments which are not readily
marketable, including restricted securities and repurchase agreements maturing
in more than seven days. Restricted securities for the purposes of this
limitation do not include securities eligible for resale pursuant to Rule 144A
of the Securities Act of 1933 that the Board of Trustees of the Fund or its
delegate, determine to be liquid, based upon the trading markets for the
specific security.

For the purpose of the Fund's investment restrictions, the issuer of a
tax-exempt security is deemed to be the entity (public or private) ultimately
responsible for the payment of principal and interest on the security.

In order to permit the sale of shares of the Fund in certain states, the
Fund may make commitments more restrictive than the policies described above.
Should the Fund determine that any such commitment is no longer in the best
interests of the Fund and its shareholders, it may revoke the commitment by
terminating sales of its shares in the state(s) involved.

OFFICERS AND TRUSTEES OF THE FUND

The Fund's Trustees and officers are listed below. Except as indicated,
each individual has held the office shown or other offices in the same company
for the last five years. Unless otherwise noted, the business address of each
Trustee and officer is 24 Federal Street, Boston, Massachusetts 02110, which is
also the address of Eaton Vance; Eaton Vance's wholly-owned subsidiary, Boston
Management and Research ("BMR"), Eaton Vance's parent, Eaton Vance Corp. ("EVC")
and of Eaton Vance's and BMR's trustee, Eaton Vance, Inc. ("EV"). Eaton Vance
and EV are both wholly-owned subsidiaries of EVC. Those Trustees and officers
who are "interested persons" of the Fund, Eaton Vance, BMR, EVC or EV as defined
in the Investment Company Act of 1940 (the "1940 Act") by virtue of their
affiliation with any one or more of the Fund, Eaton Vance, BMR, EVC or EV, are
indicated by an asterisk (*).

THOMAS J. FETTER, (51) President*
Vice President of Eaton Vance, BMR and EV. Mr. Fetter was elected President of
the Fund on December 13, 1993. Officer of various investment companies
managed by Eaton Vance or BMR.

H. DAY BRIGHAM, JR., (68) Vice President and Trustee*
Chairman of the Management Committee, Vice President of Eaton Vance, BMR, EVC
and EV and Director of EVC and EV. Director, Trustee and officer of various
investment companies managed by Eaton Vance or BMR.

DONALD R. DWIGHT, (64) Trustee
President of Dwight Partners, Inc. (a corporate relations and communications
company) founded in 1988; Chairman of the Board of Newspapers of New England,
Inc. since 1983. Director or Trustee of various investment companies managed
by Eaton Vance or BMR. Mr. Dwight was elected a Trustee of the Fund on August
20, 1993.
Address: Clover Mill Lane, Lyme, New Hampshire 03768

JAMES B. HAWKES, (53) Trustee*
Executive Vice President of Eaton Vance, BMR, EVC and EV, and a Director of EVC
and EV. Director or Trustee and officer of various investment companies
managed by Eaton Vance or BMR. Mr. Hawkes was elected a Trustee of the Fund on
August 20, 1993.

SAMUEL L. HAYES, III, (60) Trustee
Jacob H. Schiff Professor of Investment Banking, Harvard University Graduate
School of Business Administration. Director or Trustee of various investment
companies managed by Eaton Vance or BMR. Mr. Hayes was elected a Trustee of
the Fund on August 20, 1993.
Address: Harvard Business School, Soldiers Field Road, Boston, Massachusetts
02134.

NORTON H. REAMER, (59) Trustee
President and Director, United Asset Management Corporation, a holding company
owning institutional investment management firms. Chairman, President and
Director, The Regis Fund, Inc. (mutual fund). Director and Trustee of various
investment companies managed by Eaton Vance or BMR.
Address: One International Place, Boston, Massachusetts 02110

JOHN L. THORNDIKE, (68) Trustee
Director, Fiduciary Company Incorporated. Director and Trustee of various
investment companies managed by Eaton Vance or BMR.
Address: 175 Federal Street, Boston, Massachusetts 02110

JACK L. TREYNOR, (65) Trustee
Investment Adviser and Consultant. Director or Trustee of various investment
companies managed by Eaton Vance or BMR.
Address: 504 Via Almar Palos Verdes Estates, California 90274

JAMES L. O'CONNOR, (50) Treasurer*
Vice President of Eaton Vance, BMR and EV. Officer of various investment
companies managed by Eaton Vance or BMR.

THOMAS OTIS, (63) Secretary*
Vice President and Secretary of Eaton Vance, BMR, EVC and EV. Officer of various
investment companies managed by Eaton Vance or BMR.

JANET E. SANDERS, (59) Assistant Treasurer and Assistant Secretary*
Vice President of Eaton Vance, BMR and EV. Officer of various investment
companies managed by Eaton Vance or BMR.

Messrs. Thorndike (Chairman), Hayes and Reamer are members of the Special
Committee of the Board of Trustees of the Fund. The Special Committee's
functions include a continuous review of the Fund's contractual relationship
with the investment adviser, making recommendations to the Trustees regarding
the compensation of those Trustees who are not members of the investment
adviser's organization, and making recommendations to the Trustees regarding
candidates to fill vacancies, as and when they occur, in the ranks of those
Trustees who are not "interested persons" of the Fund or the investment adviser.

Messrs. Treynor (Chairman) and Dwight are members of the Audit Committee of
the Board of Trustees. The Audit Committee's functions include making
recommendations to the Trustees regarding the selection of the independent
certified public accountants, and reviewing with such accountants and the
Treasurer of the Fund matters relative to accounting and auditing practices and
procedures, accounting records, internal accounting controls, and the functions
performed by the custodian, transfer agent and dividend disbursing agent of the
Fund.

The fees and expenses of those Trustees of the Fund who are not members of
the Eaton Vance organization are paid by the Fund. During the fiscal year ended
December 31, 1994, the Trustees of the Fund earned the following compensation in
their capacities as Trustees from the Fund and other funds in the Eaton Vance
fund complex:

<TABLE>
<CAPTION>
AGGREGATE RETIREMENT TOTAL COMPENSATION
COMPENSATION BENEFIT ACCRUED FROM FUND AND
NAME ------------ FROM FUND COMPLEX AND FUND COMPLEX<F1>
- ---- FROM FUND ----------------- -------------------

<S> <C> <C> <C>
Donald R. Dwight ................................. $ 0 $8,750 $135,000
Samuel L. Hayes, III ............................. 0 8,865 142,500
Norton H. Reamer ................................. 761 --0-- 135,000
John L. Thorndike ................................ 786 --0-- 140,000
Jack L. Treynor .................................. 777 --0-- 140,000
- ----------
<FN>
<F1>The Eaton Vance fund complex consists of 201 registered investment companies or series thereof.
</TABLE>

CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES

As at March 31, 1995, the Trustees and officers of the Fund, as a group,
owned in the aggregate less than 1% of the outstanding shares of the Fund. As of
that same date, Saturn & Co., a nominee of Investors Bank & Trust Company, an
affiliate of Eaton Vance, was the record owner of approximately 74.4% of the
outstanding shares of the Fund, which it held on behalf of its custody and trust
clients. To the knowledge of the Fund, no other person beneficially owns more
than 5% of its outstanding shares.

INVESTMENT ADVISER

The Fund engages Eaton Vance as its investment adviser pursuant to an
investment advisory agreement originally made on November 23, 1982 and
reexecuted on November 1, 1990. Eaton Vance or its affiliates act as investment
adviser to investment companies and various individual and institutional clients
with combined assets under management of approximately $15 billion.

Eaton Vance, its affiliates and its predecessor companies have been managing
assets of individuals and institutions since 1924 and managing investment
companies since 1931. It maintains a large staff of experienced fixed-income and
equity investment professionals to service the needs of its clients. The
fixed-income division focuses on all kinds of taxable investment-grade and
high-yield securities, tax-exempt investment-grade and high-yield securities,
and U.S. Government securities. The equity division covers stocks ranging from
blue chip to emerging growth companies.

Under the investment advisory agreement Eaton Vance receives a monthly
advisory fee of 1/24 of 1% (equivalent to 1/2 of 1% annually) of average monthly
net assets of the Fund. As at December 31, 1994, the Fund had net assets of
$29,020,545. For the fiscal years ended December 31, 1994, December 31, 1993 and
December 31, 1992, Eaton Vance earned an advisory fee of $204,513, $243,204 and
$194,526, respectively. To enhance the net income of the Trust, Eaton Vance
reduced its fee for the fiscal years ended December 31, 1994, 1993 and 1992 in
the amount of $162,287, $84,713 and $130,011, respectively.

As investment adviser to the Fund, Eaton Vance manages the Fund's
investments and administers its affairs, subject to the supervision of the Board
of Trustees of the Fund. Pursuant to the investment advisory agreement, Eaton
Vance furnishes for the use of the Fund office space and all necessary office
facilities, equipment and personnel for servicing the investments of the Fund,
and compensates all officers and Trustees of the Fund who are members of the
Eaton Vance organization and all personnel of Eaton Vance performing services
relating to research and investment activities. The Fund has agreed to pay all
expenses not expressly stated to be payable by Eaton Vance under the investment
advisory agreement, which expenses payable by the Fund include, without implied
limitation, expenses of maintaining the Fund and continuing its existence,
registration of the Fund under the Investment Company Act of 1940, commissions,
fees and other expenses connected with the purchase or sale of securities,
auditing, accounting and legal expenses, taxes and interest, governmental fees,
expenses of issue, sale, repurchase and redemption of shares, expenses of
registering and qualifying the Fund and its shares under federal and state
securities laws and of preparing and printing prospectuses for such purposes and
for distributing the same to shareholders, expenses of reports and notices to
shareholders and of meetings of shareholders and proxy solicitations therefor,
expenses of reports to governmental officers and commissions, insurance
expenses, association membership dues, fees, expenses and disbursements of
custodians and subcustodians for all services to the Fund (including without
limitation safekeeping of funds and securities, keeping of books and accounts
and determination of net asset values), fees, expenses and disbursements of
transfer agents, dividend disbursing agents, shareholder servicing agents and
registrars for all services to the Fund, expenses for servicing shareholder
accounts, any direct charges to shareholders approved by the Trustees of the
Fund, compensation and expenses of Trustees of the Fund who are not members of
the Eaton Vance organization, and such non-recurring items as may arise,
including expenses incurred in connection with litigation, proceedings and
claims and the obligation of the Fund to indemnify its Trustees and officers
with respect thereto.

The Fund is responsible for all expenses for servicing shareholder accounts,
and Eaton Vance performs on behalf of the Fund various functions which relate to
the administration and servicing of existing shareholder accounts without being
reimbursed by the Fund for its costs in connection therewith. It is possible
that Eaton Vance may, in the future, request that the Trustees of the Fund take
action to have the Fund reimburse Eaton Vance for its costs in performing these
services. These services include functions which are primarily administrative
and clerical in nature, and include such matters as handling communications from
shareholders with respect to their accounts and the processing of liquidation
and exchange requests received from dealers or shareholders with respect to such
accounts. If any such request for reimbursement is made, the Trustees of the
Fund intend to review the specific nature and costs of these services prior to
approving any such reimbursement.

The investment advisory agreement with Eaton Vance remains in effect until
February 28, 1996; it may be continued indefinitely thereafter so long as such
continuance after February 28, 1996 is approved at least annually (i) by the
vote of a majority of the Trustees who are not interested persons of the Fund or
of Eaton Vance cast in person at a meeting specifically called for the purpose
of voting on such approval and (ii) by the Board of Trustees of the Fund or by
vote of a majority of the outstanding voting securities of the Fund. The
agreement may be terminated at any time without penalty on sixty days written
notice by the Trustees of either party or by vote of the majority of the
outstanding voting securities of the Fund, and the agreement will terminate
automatically in the event of its assignment. The agreement provides that Eaton
Vance may render services to others and may permit other fund clients and other
corporations and organizations to use the words "Eaton Vance" or "Eaton &
Howard" or "Vance, Sanders" in their names. The agreement also provides that, in
the absence of willful misfeasance, bad faith, gross negligence or reckless
disregard of obligations or duties under the agreement on the part of Eaton
Vance, Eaton Vance shall not be liable to the Fund or to any shareholder for any
act or omission in the course of or connected with rendering services or for any
losses sustained in the purchase, holding or sale of any security.

A commitment has been made to a state securities authority that Eaton Vance
will take certain actions, if necessary, so that the Fund's expenses will not
exceed expense limitation requirements of such state. The commitment may be
amended or rescinded by Eaton Vance in response to changes in the requirements
of the state or for other reasons.

Eaton Vance and EV are both wholly-owned subsidiaries of EVC. BMR is a
wholly-owned subsidiary of Eaton Vance. Eaton Vance and BMR are both
Massachusetts business trusts, and EV is the trustee of Eaton Vance and BMR. The
Directors of EV are Landon T. Clay, H. Day Brigham, Jr., M. Dozier Gardner,
James B. Hawkes and Benjamin A. Rowland, Jr. The Directors of EVC consist of the
same persons and John G. L. Cabot and Ralph Z. Sorenson. Mr. Clay is chairman
and Mr. Gardner is president and chief executive officer of EVC, Eaton Vance,
BMR and EV. All of the issued and outstanding shares of Eaton Vance and EV are
owned by EVC. All of the issued and outstanding shares of BMR are owned by Eaton
Vance. All shares of the outstanding Voting Common Stock of EVC are deposited in
a Voting Trust which expires December 31, 1996, the Voting Trustees of which are
Messrs. Brigham, Clay, Gardner, Hawkes and Rowland. The Voting Trustees have
unrestricted voting rights for the election of Directors of EVC. All of the
outstanding voting trust receipts issued under said Voting Trust are owned by
certain of the officers of Eaton Vance and BMR who are also officers and
Directors of EVC and EV. As of March 31, 1995, Messrs. Clay, Gardner and Hawkes
each owned 24% of such voting trust receipts, and Messrs. Rowland and Brigham
owned 15% and 13%, respectively, of such voting trust receipts. Messrs. Brigham,
Hawkes and Otis, who are officers or Trustees of the Fund are members of the
EVC, Eaton Vance, BMR and EV organizations. Messrs. Fetter and O'Connor and Ms.
Sanders, who are officers of the Fund, are also members of the Eaton Vance, BMR
and EV organizations. Eaton Vance will receive the fees paid under the
investment advisory agreement.

Eaton Vance owns all of the stock of Energex Corporation which is engaged in
oil and gas operations. EVC owns all of the stock of Marblehead Energy Corp.
(which engages in oil and gas operations) and owns 77.3% of the stock of
Investors Bank & Trust Company the Fund's custodian, which provides custodial,
trustee and other fiduciary services to investors, including individuals,
employee benefit plans, corporations, investment companies, savings banks and
other institutions. In addition, Eaton Vance owns all the stock of Northeast
Properties, Inc., which is engaged in real estate investment, consulting and
management. EVC owns all of the stock of Fulcrum Management, Inc. and MinVen,
Inc., which are engaged in the development of precious metal properties. Eaton
Vance, BMR, EVC and EV may also enter into other businesses.

EVC and its affiliates and their officers and employees from time to time
have transactions with various banks, including the Fund's custodian, Investors
Bank & Trust Company. It is Eaton Vance's opinion that the terms and conditions
of such transactions were not and will not be influenced by existing or
potential custodial or other relationships between the Fund and such banks.

CUSTODIAN

Investors Bank & Trust Company ("IBT"), 24 Federal Street, Boston,
Massachusetts (a 77.3% owned subsidiary of EVC) acts as custodian for the Fund.
IBT has the custody of all cash and securities of the Fund, maintains the Fund's
general ledger and computes the daily per share net asset value. In such
capacity it attends to details in connection with the sale, exchange,
substitution, transfer or other dealings with the Fund's investments, receives
and disburses all funds and performs various other ministerial duties upon
receipt of proper instructions from the Fund. IBT charges fees which are
competitive within the industry. A portion of the fee relates to custody,
bookkeeping and valuation services and is based upon a percentage of Fund net
assets and a portion of the fee relates to activity charges, primarily the
number of portfolio transactions. These fees are then reduced by a credit for
the Fund's cash balances at the custodian equal to 75% of the 91-day, U.S.
Treasury Bill auction rate applied to the Fund's average daily collected
balances. In view of the ownership of EVC in IBT, the Fund is treated as a
self-custodian pursuant to Rule 17f-2 under the Investment Company Act of 1940,
and the Fund's investments held by IBT as custodian are thus subject to the
additional examinations by the Fund's independent accountants as called for by
such Rule. During the fiscal year ended December 31, 1994, the Fund paid IBT
$45,547 under these arrangements.

PORTFOLIO SECURITY TRANSACTIONS

Decisions concerning the execution of Fund portfolio security transactions,
including the selection of the market and the executing firm, are made by Eaton
Vance. Eaton Vance is also responsible for the execution of transactions for all
other accounts managed by it.

Eaton Vance places the portfolio security transactions of the Fund and of
all other accounts managed by it for execution with many firms. Eaton Vance uses
its best efforts to obtain execution of portfolio security transactions at
prices which are advantageous to the Fund and (when a disclosed commission is
being charged) at reasonably competitive commission rates. In seeking such
execution, Eaton Vance will use its best judgment in evaluating the terms of a
transaction, and will give consideration to various relevant factors, including
without limitation the size and type of the transaction, the general execution
and operational capabilities of the executing firm, the nature and character of
the market for the security, the confidentiality, speed and certainty of
effective execution required for the transaction, the reputation, reliability,
experience and financial condition of the firm, the value and quality of the
services rendered by the firm in other transactions, and the reasonableness of
the spread or commission, if any. Municipal obligations purchased and sold by
the Fund are generally traded in the over-the-counter market on a net basis
(i.e., without commission) through broker-dealers and banks acting for their own
account rather than as brokers, or otherwise involve transactions directly with
the issuer of such obligations. Such firms attempt to profit from such
transactions by buying at the bid price and selling at the higher asked price of
the market for such obligations, and the difference between the bid and asked
price is customarily referred to as the spread. The Fund may also purchase
municipal obligations from underwriters, the cost of which may include
undisclosed fees and concessions to the underwriters. While it is anticipated
that the Fund will not pay significant brokerage commissions in connection with
such portfolio security transactions, on occasion it may be necessary or
appropriate to purchase or sell a security through a broker on an agency basis,
in which case the Fund will incur a brokerage commission. Although spreads or
commissions on portfolio security transactions will, in the judgment of Eaton
Vance, be reasonable in relation to the value of the services provided, spreads
or commissions exceeding those which another firm might charge may be paid to
firms who were selected to execute transactions on behalf of the Fund and Eaton
Vance's other clients for providing brokerage and research services to Eaton
Vance.

As authorized in Section 28(e) of the Securities Exchange Act of 1934, a
broker or dealer who executes a portfolio transaction on behalf of the Fund may
receive a commission which is in excess of the amount of commission another
broker or dealer would have charged for effecting that transaction if Eaton
Vance determines in good faith that such compensation was reasonable in relation
to the value of the brokerage and research services provided. This determination
may be made on the basis of either that particular transaction or on the basis
of overall responsibilities which Eaton Vance and its affiliates have for
accounts over which they exercise investment discretion. In making any such
determination, Eaton Vance will not attempt to place a specific dollar value on
the brokerage and research services provided or to determine what portion of the
commission should be related to such services. Brokerage and research services
may include advice as to the value of securities, the advisability of investing
in, purchasing, or selling securities, and the availability of securities or
purchasers or sellers of securities; furnishing analyses and reports concerning
issuers, industries, securities, economic factors and trends, portfolio strategy
and the performance of accounts; effecting securities transactions and
performing functions incidental thereto (such as clearance and settlement); and
the "Research Services" referred to in the next paragraph.

It is a common practice of the investment advisory industry and of the
advisers of investment companies, institutions and other investors to receive
research, statistical and quotation services, data, information and other
services, products and materials which assist such advisers in the performance
of their investment responsibilities ("Research Services") from broker-dealers
which execute portfolio transactions for the clients of such advisers and from
third parties with which such broker-dealers have arrangements. Consistent with
this practice, Eaton Vance receives Research Services from many firms with which
Eaton Vance places the Fund's portfolio transactions and from third parties with
which these broker-dealers have arrangements. These Research Services include
such matters as general economic and market reviews, industry and company
reviews, evaluations of securities and portfolio strategies and transactions,
and recommendations as to the purchase and sale of securities and other
portfolio transactions, financial, industry and trade publications, news and
information services, pricing and quotation equipment and services, and research
oriented computer hardware, software, data bases and services. Any particular
Research Service obtained through a broker-dealer may be used by Eaton Vance in
connection with client accounts other than those accounts which pay commissions
to such broker-dealer. Any such Research Service may be broadly useful and of
value to Eaton Vance in rendering investment advisory services to all or a
significant portion of its clients, or may be relevant and useful for the
management of only one client's account or of a few clients' accounts, or may be
useful for the management of merely a segment of certain clients' accounts,
regardless of whether any such account or accounts paid commissions to the
broker-dealer through which such Research Service was obtained. The advisory fee
paid by the Fund is not reduced because Eaton Vance receives such Research
Services. Eaton Vance evaluates the nature and quality of the various Research
Services obtained through broker-dealer firms and attempts to allocate
sufficient commissions to such firms to ensure the continued receipt of Research
Services which Eaton Vance believes are useful or of value to it in rendering
investment advisory services to its clients.

Subject to the requirement that Eaton Vance shall use its best efforts to
seek and execute Fund portfolio security transactions at advantageous prices and
at reasonably competitive spreads or commission rates, Eaton Vance is authorized
to consider as a factor in the selection of any firm with whom Fund portfolio
orders may be placed the fact that such firm has sold or is selling shares of
the Fund or of other investment companies sponsored by Eaton Vance. This policy
is not inconsistent with a rule of the National Association of Securities
Dealers, Inc., which rule provides that no firm which is a member of the
Association shall favor or disfavor the distribution of shares of any particular
investment company or group of investment companies on the basis of brokerage
commissions received or expected by such firm from any source.

Municipal obligations considered as investments for the Fund may also be
appropriate for other investment accounts managed by Eaton Vance or its
affiliates. Eaton Vance will attempt to allocate equitably portfolio security
transactions among the Fund and the portfolios of its other investment accounts
purchasing municipal obligations whenever decisions are made to purchase or sell
securities by the Fund and one or more of such other accounts simultaneously. In
making such allocations, the main factors to be considered are the respective
investment objectives of the Fund and such other accounts, the relative size of
portfolio holdings of the same or comparable securities, the availability of
cash for investment by the Fund and such accounts, the size of investment
commitments generally held by the Fund and such accounts and the opinions of the
persons responsible for recommending investments to the Fund and such accounts.
While this procedure could have a detrimental effect on the price or amount of
the securities available to the Fund from time to time, it is the opinion of the
Trustees that the benefits available from the Eaton Vance organization outweigh
any disadvantage that may arise from exposure to simultaneous transactions.

During the fiscal year ended December 31, 1994 the purchases and sales of
portfolio investments were with the issuer or with major dealers in money market
instruments acting as principal. The cost of securities purchased from
underwriters includes a disclosed, fixed underwriting commission or concession,
and the prices for which securities are purchased from and sold to dealers
usually include an undisclosed dealer mark-up or mark-down. The Fund paid no
brokerage commissions during 1994, 1993 or 1992.

SERVICE FOR WITHDRAWAL

By a standard agreement, the Fund's transfer agent will send to the
shareholder regular monthly or quarterly payments of any designated amount based
upon the value of the shares held. Payments from the proceeds of shares redeemed
to make withdrawal payments may exceed the amounts of distributions paid on Fund
shares and, to that extent, will reduce, or even exhaust, a shareholder's
investment.

To use this service, at least $5,000 in cash or shares at current net asset
value must be deposited with the Fund's agent. The Fund will not exercise its
right to redeem accounts of less than $1,000 in amount in connection with
Withdrawal Accounts. Either the shareholder, the Fund or the Principal
Underwriter may terminate the withdrawal plan at any time without penalty.

DETERMINATION OF NET ASSET VALUE

The Fund's use of the amortized cost method to value its portfolio
securities was originally permitted by an exemptive order dated October 6, 1981,
issued by the Securities and Exchange Commission under the Investment Company
Act of 1940. The Fund has ceased to rely on such order and relies on Rule 2a-7
promulgated under said Act as the basis for using the amortized cost method to
value its securities. Rule 2a-7 requires that the Fund limit its investments,
including puts and repurchase agreements, to those U.S. dollar-denominated
instruments which the Trustees determine present minimal credit risks and which
are, at the time of acquisition, rated by the requisite number of nationally
recognized statistical rating organizations in one of the two highest applicable
rating categories or, in the case of any instrument that is not so rated, of
comparable quality as determined by the Trustees. The Rule also requires the
Fund to maintain a dollar-weighted average portfolio maturity (not more than 90
days) appropriate to its objective of enabling the Fund to maintain a stable net
asset value of $1.00 per Fund share. In addition, the Rule precludes the
purchase of any instrument with a remaining maturity of more than 397 calendar
days. Should the disposition of a portfolio security result in a dollar-weighted
average portfolio maturity of more than 90 days, the Fund will invest its
available cash in such a manner as to reduce such maturity to 90 days or less as
soon as reasonably practicable.

The Fund will be closed for business and will not price its shares on the
following business holidays: New Year's Day, Washington's Birthday, Good Friday
(a New York Stock Exchange holiday), Memorial Day, Independence Day, Labor Day,
Thanksgiving Day and Christmas Day.

TAXES

For a general discussion of the federal income tax consequences of
investing in the Fund, see "Distributions and Taxes" in the Fund's current
prospectus.

In order to qualify each year as a regulated investment company under the
Internal Revenue Code of 1986, as amended (the "Code"), the Fund intends to
satisfy certain requirements relating to sources of income, diversification of
assets, and distribution of income and gains. So long as the Fund qualifies as a
regulated investment company for tax purposes, it will not be subject to federal
income tax on income and gains paid to shareholders in the form of dividends. In
the unlikely event that the Fund fails to so qualify, it would be subject to
federal income tax at corporate rates and all distributions from earnings and
profits, including distributions of exempt interest, would be taxable to
shareholders as ordinary income. In order to requalify for taxation as a
regulated investment company, the Fund might be required to recognize unrealized
gains, pay substantial taxes and interest, and make certain distributions.

If the Fund fails to distribute substantially all of its ordinary income
and capital gain net income on a current basis, plus any retained amounts from
the preceding year, the Fund will be subject to a 4% federal excise tax on the
undistributed amounts. The Fund may treat distributions paid in January but
declared in October, November or December of the preceding year as paid by the
Fund on December 31 of that preceding year. As a result, shareholders must
report such distributions on their federal income tax returns for the preceding
year.

The Fund's investment in securities issued at a discount and certain other
obligations will require the Fund to accrue and distribute income not yet
received. In order to generate cash sufficient to make the required
distributions, the Fund may sell securities that it would otherwise have
continued to hold.

The Fund will be qualified to pay exempt-interest dividends so long as, at
the end of each quarter of the Fund's taxable year, at least 50% of the Fund's
assets consists of obligations the interest on which is exempt from federal
income tax. That portion of any indebtedness incurred or continued by a
shareholder in order to purchase or carry shares in the Fund which corresponds
to the portion of total Fund distributions (excluding capital gains dividends)
that are exempt interest dividends is not deductible by the shareholder. Exempt
interest dividends attributable to interest received on certain "private
activity bonds" or industrial development bonds will not be tax exempt to any
shareholders who are "substantial users" (or persons related to "substantial
users") of the facilities financed by such bonds.

If a shareholder sells, redeems or otherwise disposes of Fund shares at a
loss within six months of purchase, the loss will be disallowed for federal
income tax purposes to the extent of any exempt interest dividends received. In
addition, any allowed loss will be treated as long-term capital loss to the
extent of any long-term capital gain dividends received; and all or a portion of
any loss realized will be disallowed if the shareholder purchases other Fund
shares within 30 days of the disposition (before or after).

The Fund may be required by federal law to withhold and remit to the U.S.
Treasury 31% of the taxable dividends and other distributions paid to any
individual shareholder who fails to furnish the Fund with a correct taxpayer
identification number (generally the individual's social security number), who
has underreported dividends or interest income, or who fails to certify to the
Fund that he or she is not subject to such withholding. The Fund is also
generally required to withhold on certain distributions made to non-resident
aliens and foreign entities.

Shareholders should consult their own tax advisers with respect to the
federal, state and local tax consequences of investing in the Fund.

Part or all of any interest on indebtedness incurred or continued by a
shareholder to purchase or carry shares of Tax Free Reserves is not deductible
for federal income tax purposes. Further, entities or persons who are
"substantial users" (or persons related to "substantial users") of facilities
financed by certain private activity obligations and industrial development
bonds should consult their tax advisers before purchasing shares of the Fund.
"Substantial user" is generally a "non-exempt person" who regularly uses in a
trade or business a part of a facility financed from the proceeds of industrial
development bonds or private activity obligations.

Shareholders should consult their own tax advisers with respect to the
state and local consequences of investing in the Fund.

PRINCIPAL UNDERWRITER

Although the Fund generally distributes its own shares, the Fund has entered
into a Distribution Contract with Eaton Vance Distributors, Inc. ("Principal
Underwriter"), a wholly-owned subsidiary of Eaton Vance, to permit the Fund to
distribute its shares through the Principal Underwriter when in the opinion of
the Trustees it will be in the best interest of the Fund to do so. Shares of the
Fund may be purchased directly from the Fund except in those states where they
are distributed through the Principal Underwriter. Shares of the Fund are
currently distributed through the Principal Underwriter in California, Colorado,
District of Columbia, Florida, Illinois, Indiana, Louisiana, Maine, Maryland,
Massachusetts, New Hampshire, New York, Ohio, Rhode Island, South Carolina and
Texas.

Under the Distribution Contract with the Principal Underwriter, the Fund has
agreed to pay all fees and expenses in connection with the registration of its
shares with the Securities and Exchange Commission as well as fees and expenses
in connection with registering and maintaining registrations of the Fund and of
its shares under the various state "blue-sky" laws. The Principal Underwriter
pays all expenses of preparing, printing and distributing advertising and sales
literature and all prospectuses and shareholders' reports used in the
distribution of Fund shares. The Contract provides that the Principal
Underwriter will accept orders at net asset value only, as no sales commission
or load is charged to the investor.

Eaton Vance, the Fund's adviser, makes quarterly distribution assistance
payments to selected broker/dealer firms or institutions who were instrumental
in the acquisition of shareholders for the Fund, or who performed services with
respect to shareholder accounts. Payments by Eaton Vance are made with respect
to accounts aggregating at least $1,000,000 in size only and determined and paid
in arrears by applying a rate of up to 2/10 of 1% per annum on the aggregate
average net asset value of the excess over $1,000,000 in such accounts during
the preceding quarter. The exact rate per annum used in calculating such
payments, the minimum aggregate net asset value required for eligibility for
such payments, and the factors in selecting the broker/dealer firms or
institutions to whom they will be made will be determined from time to time by
Eaton Vance. Such payments are made by Eaton Vance and not the Fund, and do not
constitute a distribution plan subject to Rule 12b-1 under the Investment
Company Act of 1940.

The Fund reserves the right to suspend or limit the offering of shares to
the public at any time.

The Distribution Contract is renewable annually by the Fund's Trustees
(including a majority of its Trustees who are not interested persons of the
Principal Underwriter or the Fund), may be terminated on six months' notice by
either party, and is automatically terminated upon assignment.

OTHER INFORMATION

Eaton Vance, pursuant to its agreement with the Fund, controls the use of
the Fund's name and may use the words "Eaton Vance" in other connections and for
other purposes. EVC may require the Fund to cease using such words in its name
if EVC or Eaton Vance or any other subsidiary or affiliate of EVC ceases to act
as investment manager of the Fund.

The Fund's Amended and Restated Declaration of Trust may be amended by the
Trustees when authorized by vote of a majority of the outstanding voting
securities of the Fund, the financial interests of which are affected by the
amendment. The Trustees may also amend the Declaration of Trust without the vote
or consent of shareholders to change the name of the Fund or to make such other
changes as do not have a materially adverse effect on the financial interests of
shareholders or if they deem it necessary to conform it to applicable Federal or
state laws or regulations. The Fund or class thereof may be terminated by: (1)
the affirmative vote of the holders of not less than two-thirds of the shares
outstanding and entitled to vote at any meeting of shareholders of the Fund or
class thereof, or by an instrument or instruments in writing without a meeting,
consented to by the holders of two-thirds of the shares of the Fund or class
thereof, provided, however, that, if such termination is recommended by the
Trustees, the vote of a majority of the outstanding voting securities of the
Fund or class thereof entitled to vote thereon shall be sufficient
authorization; or (2) by means of an instrument in writing signed by a majority
of the Trustees, to be followed by a written notice to shareholders stating that
a majority of the Trustees has determined that the continuation of the Fund or a
class thereof is not in the best interest of the Fund, or class or of their
respective shareholders.

The Declaration of Trust further provides that the Trustees will not be
liable for errors of judgment or mistakes of fact or law; but nothing in the
Declaration of Trust protects a Trustee against any liability to which he would
otherwise be subject by reason of willful misfeasance, bad faith, gross
negligence, or reckless disregard of the duties involved in the conduct of his
office. In addition, the By-Laws of the Fund provide that no natural person
shall serve as a Trustee of the Fund after the holders of record of not less
than two-thirds of the outstanding shares have declared that he be removed from
office either by declaration in writing filed with the custodian of the assets
of the Fund or by votes cast in person or by proxy at a meeting called for the
purpose. The By-Laws also provide that the Trustees shall promptly call a
meeting of Shareholders for the purpose of voting upon a question of removal of
a Trustee when requested so to do by the record holders of not less than 10 per
centum of the outstanding shares.

As permitted by Massachusetts law, there will normally be no meetings of
shareholders for the purpose of electing Trustees unless and until such time as
less than a majority of the Trustees holding office have been elected by
shareholders. In such an event the Trustees then in office will call a
shareholders' meeting for the election of Trustees. Except for the foregoing
circumstances and unless removed by action of the shareholders in accordance
with the Fund's by-laws, the Trustees shall continue to hold office and may
appoint successor Trustees.

The right to redeem can be suspended and the payment of the redemption price
deferred when the New York Stock Exchange is closed (other than for customary
weekend and holiday closings), during periods when trading on the New York Stock
Exchange is restricted as determined by the Securities and Exchange Commission,
or during any emergency as determined by the Securities and Exchange Commission
which makes it impracticable for the Fund to dispose of its securities or value
its assets, or during any other period permitted by order of the Securities and
Exchange Commission for the protection of investors.

CALCULATION OF YIELD QUOTATIONS

From time to time, the Fund quotes a current yield based on a specific
seven calendar day period which is calculated by first dividing the net change
in the value of an account having a balance of one share at the beginning of the
period by the value of the account at such time to determine the seven day base
period return, and then multiplying such return by 365/7 with the resulting
yield figure carried to at least the nearest hundredth of one percent. The net
change in account value is determined by the value of additional shares
purchased with dividends declared on the original share and dividends declared
on both the original share and any such additional shares, but does not include
any realized gains or losses from the sales of securities or any unrealized
appreciation or depreciation on portfolio securities. In addition to the current
yield, the Fund also quotes an effective yield based on a specific seven day
period carried to at least the nearest hundredth of one percent, computed by
determining the net change, exclusive of capital changes, in the value of a
hypothetical preexisting account having a balance of one share at the beginning
of the period, and dividing the difference by the value of the account at the
end of the base period to obtain the base period return, and then compounding
the base period return by adding 1, raising the sum to a power equal to 365
divided by 7, and subtracting 1 from the result, according to the following
formula:

Effective yield = [(Base period return +1) 365/7]-1: A taxable-equivalent yield
is computed by using the tax-exempt yield figure and dividing by 1 minus the tax
rate.

The Fund's annualized current and effective yields for the seven-day period
ending December 31, 1994 were 3.69% and 3.76%, respectively. The
taxable-equivalent current and effective yields for that same period were 5.35%
and 5.49% (assuming a tax rate of 31%). Yields will fluctuate from time to time
and are not necessarily representative of future results. A shareholder should
remember that yield is a function of the type and quality of the instruments in
the Fund's portfolio.

INDEPENDENT ACCOUNTANTS

Coopers & Lybrand L.L.P., One Post Office Square, Boston, Massachusetts,
are the Fund's independent accountants, providing audit services, tax return
preparations, and assistance and consultation with respect to the preparation of
filings with the Securities and Exchange Commission.

FINANCIAL STATEMENTS

Registrant incorporates by reference the audited financial information for
the Fund contained in the Fund's shareholder report for the fiscal year ended
December 31, 1994 as previously filed electronically with the Securities and
Exchange Commission (Accession No. 0000950156-95-000078).

<PAGE>

APPENDIX

Some of the terms used in this Statement of Additional Information are
described below.

Description of permitted Fund investments:

(1) Project Notes (PNs) are auctioned by the Department of Housing and Urban
Development on behalf of local government authorities to finance urban renewal
and low income housing projects. They are backed by the full faith and credit of
the U.S. Government.

(2) Other Tax-Exempt Notes are issued by or on behalf of states and their
political subdivisions, agencies and instrumentalities for a variety of
short-term needs. These include but are not limited to:

Tax and/or Revenue Anticipation Notes: (TANs, RANs, TRANs) are generally
issued to finance seasonal working capital needs in anticipation of various
taxes or revenues, and payable from these specific future revenues.
Additionally, most TANs, RANs and TRANs are general obligations of the
issuing entity.

Bond Anticipation Notes: (BANs) are issued to provide interim financing
until long-term financing can be arranged. In most cases, the long-term
bonds, then provide the funds to pay off the BANs. Additionally, most BAN's
may be general obligations of the issuing entity.

Construction Loan Notes: (CLNs) are issued primarily by housing agencies to
provide interim construction financing. After completion, most projects
receive permanent financing through the Federal National Mortgage
Association (FNMA) or the Government National Mortgage Association (GNMA);
others are financed by the issuance of long-term bonds. In either case, the
permanent financing provides the "take-out" for the holder of the notes.

Federal Grant Anticipation Notes: (FANs, GANs) are issued to provide interim
financing, most often for water and sewer projects, in anticipation of
matching federal grants. Additionally, most FAN's and GAN's may be general
obligations of the issuing entity.

Temporary Notes: (TNs) are short-term general obligations issued for
various purposes.

(3) Tax-Exempt Bonds are issued by or on behalf of states and their political
subdivisions, agencies and instrumentalities for longer term capital needs and
generally have original maturities of longer than one year. They are usually
classified as either General Obligations or Revenue Bonds.

Revenue Bonds are secured by the revenues derived from a particular facility
or class of facilities or from some other specific revenue source or in the case
of industrial development bonds, by the earnings of the private enterprise whose
facility is being financed.

There are also a variety of hybrid and special types of municipal
obligations. Some tax-exempt bonds are additionally secured by insurance, bank
credit agreements, or escrow accounts.

While most tax-exempt bonds pay a fixed rate of interest, others are
variable rate instruments whose interest rates are adjusted at specified
intervals (weekly, monthly, semi-annually, etc.).

Most tax-exempt bonds have a fixed final maturity date; however, some have
"put" or "'demand" features that allow early redemption by the bondholder.

(4) Tax-Exempt Commercial Paper consists of unsecured obligations of state or
local governments or instrumentalities which are payable from available funds of
the issuer. These obligations are often backed by a bank letter of credit or
supported by a tender agreement permitting the holder to resell the obligation
to the issuer's agent. Maturities range from one day to 270 days.

(5) Taxable Commercial Paper consists of promissory notes of corporations,
usually with a bank line of credit, with maturities ranging from one day to 270
days.

6) U.S. Government, Agency and Instrumentality Obligations are as follows: U.S.
Government obligations are issued by the Treasury and include bills,
certificates of indebtedness, notes, and bonds. Agencies and instrumentalities
of the U.S. Government are established under the authority of an act of Congress
and include, but are not limited to, the Government National Mortgage
Association, the Tennessee Valley Authority, the Bank for Cooperatives, the
Farmers Home Administration, Federal Home Loan Banks, Federal Intermediate
Credit Banks, Federal Land Banks, and the Federal National Mortgage Association.

(7) Floating or Variable Rate Obligations normally provide that the holder can
demand payment of the obligation on short notice at par with accrued interest
and which are frequently secured by letters of credit or other credit support
arrangements provided by banks. To the extent that such letters of credit or
other arrangements constitute an unconditional guarantee of the issuer's
obligations, the banks may be treated as the issuer of a security for the
purpose of complying with the diversification requirements set forth in Section
5(b) of the Investment Company Act and Rule 5b-2 thereunder.

(8) Repurchase Agreements involve purchase of debt securities of the U.S.
Treasury, or a Federal agency, Federal instrumentality or Federally created
corporation. At the same time the Fund purchases the security it resells it to
the vendor (a member bank of the Federal Reserve System or recognized securities
dealer), and is obligated to redeliver the security to the vendor on an
agreed-upon date in the future. The resale price is in excess of the purchase
price and reflects an agreed upon market rate unrelated to the coupon rate on
the purchased security. Such transactions afford an opportunity for the Fund to
earn, at no market risk, a return on cash which is only temporarily available.
The Fund's risk is in the ability of the vendor to pay an agreed-upon sum upon
the delivery date, and the Fund believes the risk is limited to the difference
between the market value of the security and the repurchase price provided for
in the repurchase agreement. However, in the event of bankruptcy or insolvency
proceedings affecting the vendor of the security which is subject to the
repurchase agreement, the Fund's ability to dispose of such underlying security
may be impaired.

The Investment Company Act of 1940 prohibits registered investment companies
from acquiring securities issued by broker-dealers. A transaction whereby the
Fund enters into a repurchase agreement with a broker-dealer might be construed
as a contravention of this prohibition. In the event the law is so interpreted,
the Fund will cease such transactions.

(9) Certificates of Deposit are certificates issued against funds deposited in a
commercial bank, are for a definite period of time, earn a specified rate of
return, and are normally negotiable.

(10) Bankers' Acceptances are short-term credit instruments used to finance the
import, export, transfer or storage of goods. They are termed "accepted" when a
bank guarantees their payment at maturity.

DESCRIPTION OF AVAILABLE QUALITY RATINGS

(1) Moody's Investors Service, Inc.

Ratings of Tax-Exempt Notes

Ratings: Moody's rating for state and municipal short term obligations will
be designated Moody's Investment Grade or (MIG). Such rating recognizes the
differences between short term credit risk and long term risk. Factors affecting
the liquidity of the borrower and short term cyclical elements are critical in
short term ratings, while other factors of major importance in bond risk, long
term secular trends for example, may be less important over the short run.

A short term rating may also be assigned on an issue having a demand
feature, variable rate demand obligation (VRDO). Such ratings will be designated
as VMIG SG or if the demand feature is not rated, NR. A short term rating on
issues with demand features are differentiated by the use of the VMIG symbol to
reflect such characteristics as payment upon periodic demand rather than fixed
maturity dates and payment relying on external liquidity. Additionally,
investors should be alert to the fact that the source of payment may be limited
to the external liquidity with no or limited legal recourse to the issuer in the
event the demand is not met.

Ratings of Commercial Paper

Moody's Commercial Paper ratings are opinions of the ability of issuers to
repay punctually promissory obligations not having an original maturity in
excess of nine months.

Prime-1: Issuers (or supporting institutions) rated Prime-1 (P-1) have a
superior ability for repayment of senior short-term debt obligations.

Ratings of Tax-Exempt Bonds

Aaa: Bonds which are rated Aaa are judged to be of the best quality. They
carry the smallest degree of investment risk and are generally referred to as
"gilt edge". Interest payments are protected by a large or by an exceptionally
stable margin and principal is secure. While the various protective elements are
likely to change, such changes as can be visualized are most unlikely to impair
the fundamentally strong position of such issues.

Aa: Bonds which are rated Aa are judged to be of high quality by all standards.
Together with the Aaa group they comprise what are generally known as high grade
bonds. They are rated lower than the best bonds because margins of protection
may not be as large as in Aaa securities or fluctuation of protective elements
may be of greater amplitude or there may be other elements present which make
the long-term risks somewhat larger than in Aaa securities.

(2) STANDARD & POOR'S RATINGS GROUP

Ratings of Tax-Exempt Bonds

AAA: Debt rated AAA has the highest rating assigned by Standard & Poor's.
Capacity to pay interest and repay principal is extremely strong.

AA: Debt rated AA has a very strong capacity to pay interest and repay principal
and differs from the highest rated issues only in small degree.

Note rating symbols are as follows:

SP-1: Very strong or strong capacity to pay principal and interest. Those issues
determined to possess overwhelming safety characteristics will be given a plus
sign (+) designation.

Ratings of Commercial Paper

Standard & Poor's commercial paper rating is a current assessment of the
likelihood of timely payment of debt having an original maturity of no more than
365 days.

A: Standard & Poor's commercial paper rating is a current assessment of the
likelihood of timely payment of debt having an original maturity of no more than
365 days.

A-1: This highest category indicates that the degree of safety regarding timely
payment is strong. Those issues determined to possess extremely strong safety
characteristics are denoted with a plus sign (+) designation.

(3) FITCH INVESTORS SERVICE, INC.

Investment Grade Bond Ratings

AAA: Bonds considered to be investment grade and of the highest credit quality.
The obligor has an exceptionally strong ability to pay interest and repay
principal, which is unlikely to be affected by reasonably foreseeable events.

AA: Bonds considered to be investment grade and of very high credit quality. The
obligor's ability to pay interest and repay principal is very strong, although
not quite as strong as bonds rated "AAA". Because bonds rated in the "AAA" and
"AA" categories are not significantly vulnerable to foreseeable future
developments, short-term debt of these issuers is generally rated "F-1+".

Plus (+) or Minus (-): The ratings from AA to C may be modified by the addition
of a plus or minus sign to indicate the relative position of a credit within the
rating category,

NR: Indicates that Fitch does not rate the specific issue.

Conditional: A conditional rating is premised on the successful completion of a
project or the occurrence of a specific event.

Investment Grade Short-Term Ratings

Fitch's short-term ratings apply to debt obligations that are payable on demand
or have original maturities of up to three years, including commercial paper,
certificates of deposit, medium-term notes, and municipal and investment notes.

F-1+: Exceptionally Strong Credit Quality. Issues assigned this rating are
regarded as having the strongest degree of assurance for timely payment.

Tax-Exempt Investment Note Ratings

The ratings on tax-exempt notes, with maturities generally up to three years,
reflect Fitch's current appraisal of the degree of assurance of timely payment,
whatever the source.

FIN-1: Notes regarded as having the strongest degree of assurance for timely
payment.

Plus (+): Plus signs may be used in the "FIN-1" category to indicate relative
standing. The note ratings will usually correspond with bond ratings, although
certain security enhancements or market access may mean that notes will not
track bonds.

Demand Bond or Note Ratings

Certain demand securities empower the holder at his option to require the
issuer, usually through a remarketing agent, to repurchase the security upon
notice at par with accrued interest. This is also referred to as a put option.
The ratings of the demand provision may be changed or withdrawn at any time if,
in Fitch's judgment, changing circumstances warrant such action. Fitch demand
provision ratings carry the same symbols and related definitions as its
short-term ratings.

********

Investors should note that the assignment of a rating to a bond by a rating
service may not reflect the effect of recent developments on the issuer's
ability to make interest and principal payments

<PAGE>
INVESTMENT ADVISER
Eaton Vance Management
24 Federal Street
Boston, MA 02110

PRINCIPAL UNDERWRITER
Eaton Vance Distributors, Inc.
24 Federal Street
Boston, MA 02110
(800) 225-6265

CUSTODIAN
Investors Bank & Trust Company
24 Federal Street
Boston, MA 02110

TRANSFER AGENT
The Shareholder Services Group, Inc.
BOS725
P.O. Box 1559
Boston, MA 02104
(800) 262-1122

INDEPENDENT ACCOUNTANTS
Coopers & Lybrand L.L.P.
One Post Office Square
Boston, MA 02109

EATON VANCE TAX FREE RESERVES
24 FEDERAL STREET
BOSTON, MA 02110

TRSAI

EATON VANCE
TAX FREE
RESERVES

STATEMENT OF
ADDITIONAL
INFORMATION

MAY 1, 1995

PART C
OTHER INFORMATION

ITEM 24. FINANCIAL STATEMENTS AND EXHIBITS
(A) FINANCIAL STATEMENTS

INCLUDED IN PART A:
Financial Highlights for each of the ten years ended December 31,
1994.

INCLUDED IN PART B:
INCORPORATED BY REFERENCE TO THE ANNUAL REPORT FOR THE FUND, DATED
DECEMBER 31, 1994, FILED ELECTRONICALLY PURSUANT TO SECTION 30(B)
(2) OF THE INVESTMENT COMPANY ACT OF 1940

FINANCIAL STATEMENTS FOR EATON VANCE TAX FREE RESERVES (ACCESSION NO.
0000950156-95-000078)

Portfolio of Investments as at December 31, 1994
Statement of Assets and Liabilities as at December 31, 1994
Statement of Operations for the year ended December 31, 1994
Statement of Changes in Net Assets for each of the two years ended
December 31, 1994
Financial Highlights for each of the five years ended December 31,
1994
Notes to Financial Statements
Independent Accountants' Report

(B) EXHIBITS:

(1) Amended and Restated Declaration of Trust dated September 27,
1993 filed as Exhibit (b) (1) to Post-Effective Amendment No. 12
and incorporated herein by reference.
(2)(a) By-laws, as amended filed as Exhibit (2) to Pre-Effective
Amendment No. 2 and incorporated herein by reference.
(b) Amendment to By-Laws of Eaton Vance Tax Free Reserves dated
December 13, 1993 filed as Exhibit (b)(2) to Post-Effective
Amendment No. 12 and incorporated herein by reference.

(3) Not applicable.
(4) Not applicable.
(5) Investment Advisory Agreement with Eaton Vance Management dated
November 1, 1990 filed as Exhibit (5) to Post-Effective
Amendment No. 9 and incorporated herein by reference.
(6) Distribution Contract with Eaton Vance Distributors, Inc. dated
November 23, 1982 filed as Exhibit (6) to Post-Effective
Amendment No. 3 and incorporated herein by reference.
(7) Not applicable.
(8) Custodian Agreement with Investors Bank & Trust Company dated
December 17, 1990 filed as Exhibit (8) to Post-Effective
Amendment No. 9 and incorporated herein by reference.
(9) Not applicable.

(10) Opinion of Counsel filed herewith.

(11) Consent of Independent Accountants filed herewith.
(12) Not applicable.
(13) Agreement made in consideration of providing initial capital
dated November 19, 1982 filed as Exhibit (13) to Pre-Effective
Amendment No. 3 and incorporated herein by reference.
(14) Not applicable.
(15) Not applicable.
(16) Schedule for Computation of Yield Quotations filed herewith.

(17) Power of Attorney dated February 22, 1994 filed as Exhibit
(b)(17) to Post-Effective Amendment No. 12 and incorporated
herein by reference.

<PAGE>
ITEM 25. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH REGISTRANT
Not applicable

ITEM 26. NUMBER OF HOLDERS OF SECURITIES
(2)
(1) NUMBER OF
TITLE OF CLASS RECORD HOLDERS
-------------- --------------
Shares of beneficial interest 249
without par value as of March 31, 1995

ITEM 27. INDEMNIFICATION

No change over the original filing has been made.

Registrant's Trustees and officers are insured under a standard mutual fund
errors and omissions insurance policy covering loss incurred by reason of
negligent errors and omissions committed in their capacities as such.

ITEM 28. BUSINESS AND OTHER CONNECTIONS OF THE INVESTMENT ADVISER

Reference is made to the information set forth under the caption "Investment
Advisory and Other Services" in the Statement of Additional Information, which
information is incorporated herein by reference.

ITEM 29. PRINCIPAL UNDERWRITER
(A) Registrant's Principal Underwriter, Eaton Vance Distributors, Inc., a
wholly-owned subsidiary of Eaton Vance Management, is the principal
underwriter for each of the investment companies named below:

EV Classic Alabama Tax Free Fund EV Classic Michigan Tax Free Fund
EV Classic Arizona Tax Free Fund EV Classic Minnesota Tax Free Fund
EV Classic Arkansas Tax Free Fund EV Classic Mississippi Tax Free Fund
EV Classic California Limited Maturity EV Classic Missouri Tax Free Fund
Tax Free Fund EV Classic National Limited Maturity Tax Free Fund
EV Classic California Municipals Fund EV Classic National Municipals Fund
EV Classic Colorado Tax Free Fund EV Classic New Jersey Limited Maturity
EV Classic Connecticut Limited Maturity Tax Free Fund
Tax Free Fund EV Classic New Jersey Tax Free Fund
EV Classic Connecticut Tax Free Fund EV Classic New York Limited Maturity
EV Classic Florida Insured Tax Free Fund Tax Free Fund
EV Classic Florida Limited Maturity EV Classic New York Tax Free Fund
Tax Free Fund EV Classic North Carolina Tax Free Fund
EV Classic Florida Tax Free Fund EV Classic Ohio Limited Maturity Tax Free Fund
EV Classic Georgia Tax Free Fund EV Classic Ohio Tax Free Fund
EV Classic Government Obligations Fund EV Classic Oregon Tax Free Fund
EV Classic Greater China Growth Fund EV Classic Pennsylvania Limited Maturity
EV Classic Growth Fund Tax Free Fund
EV Classic Hawaii Tax Free Fund EV Classic Pennsylvania Tax Free Fund
EV Classic High Income Fund EV Classic Rhode Island Tax Free Fund
EV Classic Investors Fund EV Classic Strategic Income Fund
EV Classic Kansas Tax Free Fund EV Classic South Carolina Tax Free Fund
EV Classic Kentucky Tax Free Fund EV Classic Special Equities Fund
EV Classic Louisiana Tax Free Fund EV Classic Senior Floating-Rate Fund
EV Classic Maryland Tax Free Fund EV Classic Stock Fund
EV Classic Massachusetts Limited Maturity EV Classic Tennessee Tax Free Fund
Tax Free Fund EV Classic Texas Tax Free Fund
EV Classic Massachusetts Tax Free Fund EV Classic Total Return Fund
EV Classic Michigan Limited Maturity EV Classic Virginia Tax Free Fund
Tax Free Fund EV Classic West Virginia Tax Free Fund
<PAGE>
EV Marathon Alabama Tax Free Fund EV Marathon Ohio Limited Maturity Tax Free Fund
EV Marathon Arizona Limited Maturity EV Marathon Ohio Tax Free Fund
Tax Free Fund EV Marathon Oregon Tax Free Fund
EV Marathon Arizona Tax Free Fund EV Marathon Pennsylvania Limited Maturity
EV Marathon Arkansas Tax Free Fund Tax Free Fund
EV Marathon California Limited Maturity EV Marathon Pennsylvania Tax Free Fund
Tax Free Fund EV Marathon Rhode Island Tax Free Fund
EV Marathon California Municipals Fund EV Marathon Strategic Income Fund
EV Marathon Colorado Tax Free Fund EV Marathon South Carolina Tax Free Fund
EV Marathon Connecticut Limited Maturity EV Marathon Special Equities Fund
Tax Free Fund EV Marathon Stock Fund
EV Marathon Connecticut Tax Free Fund EV Marathon Tennessee Tax Free Fund
EV Marathon Emerging Markets Fund EV Marathon Texas Tax Free Fund
Eaton Vance Equity - Income Trust EV Marathon Total Return Fund
EV Marathon Florida Insured Tax Free Fund EV Marathon Virginia Limited Maturity
EV Marathon Florida Limited Maturity Tax Free Fund
Tax Free Fund EV Marathon Virginia Tax Free Fund
EV Marathon Florida Tax Free Fund EV Marathon West Virginia Tax Free Fund
EV Marathon Georgia Tax Free Fund EV Traditional California Municipals Fund
EV Marathon Gold & Natural Resources Fund EV Traditional Connecticut Tax Free Fund
EV Marathon Government Obligations Fund EV Traditional Emerging Markets Fund
EV Marathon Greater China Growth Fund EV Traditional Florida Insured Tax Free Fund
EV Marathon Greater India Fund EV Traditional Florida Limited Maturity
EV Marathon Growth Fund Tax Free Fund
EV Marathon Hawaii Tax Free Fund EV Traditional Florida Tax Free Fund
EV Marathon High Income Fund EV Traditional Government Obligations Fund
EV Marathon Investors Fund EV Traditional Greater China Growth Fund
EV Marathon Kansas Tax Free Fund EV Traditional Greater India Fund
EV Marathon Kentucky Tax Free Fund EV Traditional Growth Fund
EV Marathon Louisiana Tax Free Fund Eaton Vance Income Fund of Boston
EV Marathon Maryland Tax Free Fund EV Traditional Investors Fund
EV Marathon Massachusetts Limited Maturity Eaton Vance Municipal Bond Fund L.P.
Tax Free Fund EV Traditional National Limited Maturity
EV Marathon Massachusetts Tax Free Fund Tax Free Fund
EV Marathon Michigan Limited Maturity Tax Free Fund EV Traditional National Municipals Fund
EV Marathon Michigan Tax Free Fund EV Traditional New Jersey Tax Free Fund
EV Marathon Minnesota Tax Free Fund EV Traditional New York Limited Maturity
EV Marathon Mississippi Tax Free Fund Tax Free Fund
EV Marathon Missouri Tax Free Fund EV Traditional New York Tax Free Fund
EV Marathon National Limited Maturity EV Traditional Pennsylvania Tax Free Fund
Tax Free Fund EV Traditional Special Equities Fund
EV Marathon National Municipals Fund EV Traditional Stock Fund
EV Marathon New Jersey Limited Maturity EV Traditional Total Return Fund
Tax Free Fund Eaton Vance Cash Management Fund
EV Marathon New Jersey Tax Free Fund Eaton Vance Liquid Assets Fund
EV Marathon New York Limited Maturity Eaton Vance Money Market Fund
Tax Free Fund Eaton Vance Prime Rate Reserves
EV Marathon New York Tax Free Fund Eaton Vance Short-Term Treasury Fund
EV Marathon North Carolina Limited Maturity Eaton Vance Tax Free Reserves
Tax Free Fund Massachusetts Municipal Bond Portfolio
EV Marathon North Carolina Tax Free Fund
<PAGE>

</TABLE>
<TABLE>
<CAPTION>
(B)
(1) (2) (3)
NAME AND PRINCIPAL POSITIONS AND OFFICES POSITIONS AND OFFICES
BUSINESS ADDRESS WITH PRINCIPAL UNDERWRITER WITH REGISTRANT
---------- --------------- ----------
<S> <C> <C>
James B. Hawkes<F1> Vice President and Director Trustee
William M. Steul<F1> Vice President and Director None
Wharton P. Whitaker<F1> President and Director None
Howard D. Barr Vice President None
2750 Royal View Court
Oakland, Michigan
Nancy E. Belza Vice President None
463-1 Buena Vista East
San Francisco, California
Chris Berg Vice President None
45 Windsor Lane
Palm Beach Gardens, Florida
H. Day Brigham, Jr.<F1> Vice President None
Susan W. Bukima Vice President None
106 Princess Street
Alexandria, Virginia
Jeffrey W. Butterfield Vice President None
9378 Mirror Road
Columbus, Indiana
Mark A. Carlson<F1> Vice President None
Jeffrey Chernoff Vice President None
115 Concourse West
Bright Waters, New York
William A. Clemmer<F1> Vice President None
James S. Comforti Vice President None
1859 Crest Drive
Encinitas, California
Mark P. Doman Vice President None
107 Pine Street
Philadelphia, Pennsylvania
Michael A. Foster Vice President None
850 Kelsey Court
Centerville, Ohio
William M. Gillen Vice President None
280 Rea Street
North Andover, Massachusetts
Hugh S. Gilmartin Vice President None
1531-184th Avenue, NE
Bellevue, Washington
Richard E. Houghton<F1> Vice President None
Brian Jacobs<F1> Senior Vice President None
Stephen D. Johnson Vice President None
13340 Providence Lake Drive
Alpharetta, Georgia
Thomas J. Marcello Vice President None
553 Belleville Avenue
Glen Ridge, New Jersey
Timothy D. McCarthy Vice President None
9801 Germantown Pike
Lincoln Woods Apt. 416
Lafayette Hill, Pennsylvania
Morgan C. Mohrman<F1> Senior Vice President None
Gregory B. Norris Vice President None
6 Halidon Court
Palm Beach Gardens, Florida
Thomas Otis<F1> Secretary and Clerk Secretary
George D. Owen Vice President None
1911 Wildwood Court
Blue Springs, Missouri
F. Anthony Robinson Vice President None
510 Gravely Hill Road
Wakefield, Rhode Island
Benjamin A. Rowland, Jr.<F1> Vice President, None
Treasurer and Director
John P. Rynne<F1> Vice President None
<PAGE>
(1) (2) (3)
NAME AND PRINCIPAL POSITIONS AND OFFICES POSITIONS AND OFFICES
BUSINESS ADDRESS WITH PRINCIPAL UNDERWRITER WITH REGISTRANT
---------- --------------- ----------
George V.F. Schwab, Jr. Vice President None
9501 Hampton Oaks Lane
Charlotte, North Carolina
Cornelius J. Sullivan<F1> Vice President None
Maureen C. Tallon Vice President None
518 Armistead Drive
Nashville, Tennessee
David M. Thill Vice President None
126 Albert Drive
Lancaster, New York
William T. Toner Vice President None
747 Lilac Drive
Santa Barbara, California
Chris Volf Vice President None
6517 Thoroughbred Loop
Odessa, Florida
Donald E. Webber<F1> Senior Vice President None
Sue Wilder Vice President None
141 East 89th Street
New York, New York
(C) Not applicable.
- ----------
<FN>
<F1>Address is 24 Federal Street, Boston, MA 02110
</TABLE>

ITEM 30. LOCATION OF ACCOUNTS AND RECORDS

All applicable accounts, books and documents required to be maintained by
the Registrant by Section 31(a) of the Investment Company Act of 1940 and the
Rules promulgated thereunder are in the possession and custody of the
Registrant's custodian, Investors Bank & Trust Company, 24 Federal Street,
Boston, MA 02110 and 89 South Street, Boston, Massachusetts 02111, and its
transfer agent, The Shareholder Services Group, Inc., 53 State Street, Boston,
MA 02104, with the exception of certain corporate documents and portfolio
trading documents which are in the possession and custody of Eaton Vance
Management, 24 Federal Street, Boston, MA 02110. The Registrant is informed that
all applicable accounts, books and documents required to be maintained by
registered investment advisers are in the custody and possession of Eaton Vance
Management.

ITEM 31. MANAGEMENT SERVICES
Not applicable

ITEM 32. UNDERTAKINGS
The Registrant undertakes to furnish to each person to whom a prospectus is
delivered a copy of the latest annual report to shareholders, upon request and
without charge.
<PAGE>
SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, and the
Investment Company Act of 1940, the Registrant certifies that it meets all of
the requirements for effectiveness of this Amendment to the Registration
Statement pursuant to Rule 485(b) under the Securities Act of 1933 and has duly
caused this Amendment to the Registration Statement to be signed on its behalf
by the undersigned, thereunto duly authorized, in the City of Boston, and the
Commonwealth of Massachusetts, on the 26th day of April, 1995.

EATON VANCE TAX FREE RESERVES
/s/ THOMAS J. FETTER
----------------------------------------------
THOMAS J. FETTER, President

Pursuant to the requirements of the Securities Act of 1933 this Post-
Effective Amendment to the Registration Statement has been signed below by the
following persons in the capacities and on the dates indicated:

SIGNATURE TITLE DATE
- ------------------- ---------------------- --------------
President (Chief Executive
/s/ THOMAS J. FETTER Officer) April 26, 1995
- ------------------------------
THOMAS J. FETTER

Treasurer and Principal
Financial and Accounting
/s/ JAMES L. O'CONNOR Officer April 26, 1995
- ------------------------------
JAMES L. O'CONNOR

/s/ H. DAY BRIGHAM, JR. Trustee April 26, 1995
- ------------------------------
H. DAY BRIGHAM, JR.

DONALD R. DWIGHT* Trustee April 26, 1995
- ------------------------------
DONALD R. DWIGHT

/s/ JAMES B. HAWKES Trustee April 26, 1995
- ------------------------------
JAMES B. HAWKES

SAMUEL L. HAYES, III* Trustee April 26, 1995
- ------------------------------
SAMUEL L. HAYES, III

NORTON H. REAMER* Trustee April 26, 1995
- ------------------------------
NORTON H. REAMER

JOHN L. THORNDIKE* Trustee April 26, 1995
- ------------------------------
JOHN L. THORNDIKE

JACK L. TREYNOR* Trustee April 26, 1995
- ------------------------------
JACK L. TREYNOR

*BY: /s/ H. DAY BRIGHAM, JR.
- ------------------------------
As Attorney-in-fact
<PAGE>
EXHIBIT INDEX

The following exhibits are filed as a part of this amendment to the
Registration Statement pursuant to General Instructions E of Form N-1A.

PAGE IN SEQUENTIAL
EXHIBIT NO. DESCRIPTION NUMBERING SYSTEM
----------- ----------- ----------------
(10) Opinion of Counsel
(11) Consent of Independent Accountants
(16) Schedule for Computation of Yield Quotations

April 28, 1995

Eaton Vance Tax Free Reserves
24 Federal Street
Boston, MA 02110

Gentlemen:

Eaton Vance Tax Free Reserves (the "Trust") is a Massachusetts business
trust created under a Declaration of Trust dated July 15, 1981 executed and
delivered in Boston, Massachusetts and currently operating under an Amended and
Restated Declaration of Trust dated September 27, 1993 (the "Declaration of
Trust"). I am of the opinion that all legal requirements have been complied with
in the creation of the Trust, and that said Declaration of Trust is legal and
valid.

The Trustees of the Trust have the powers set forth in the Declaration
of Trust, subject to the terms, provisions and conditions therein provided. As
provided in the Declaration of Trust, the interest of shareholders is divided
into shares of beneficial interest without par value, and the number of shares
that may be issued is unlimited. The Trustees may from time to time issue and
sell or cause to be issued and sold shares for cash or for property. All such
shares, when so issued, shall be fully paid and nonassessable by the Trust.

By votes duly adopted, the Trustees of the Trust have authorized the
issuance of shares of beneficial interest, without par value. The Trust intends
to register under the Securities Act of 1933, as amended, 31,736,923 of its
shares of beneficial interest with Post-Effective Amendment No. 13 to its
Registration Statement on Form N-1A (the "Amendment") with the Securities and
Exchange Commission.

I have examined originals, or copies, certified or otherwise identified
to my satisfaction, of such certificates, records and other documents as I have
deemed necessary or appropriate for the purpose of this opinion, including the
Declaration of Trust and votes adopted by the Trustees. Based upon the
foregoing, and with respect to Massachusetts law (other than the Massachusetts
Uniform Securities Act), only to the extent that Massachusetts law may be
applicable and without reference to the laws of the other several states or of
the United States of America, I am of the opinion that under existing law:

1. The Trust is a trust with transferable shares of beneficial interest
organized in compliance with the laws of The Commonwealth of Massachusetts, and
the Declaration of Trust is legal and valid under the laws of The Commonwealth
of Massachusetts.

2. Shares of beneficial interest registered by the Amendment may be
legally and validly issued in accordance with the Declaration of Trust upon
receipt by the Trust of payment in compliance with the Declaration of Trust and,
when so issued and sold, will be fully paid and nonassessable by the Trust.

I am a member of the Massachusetts and New York bars and have acted as
internal legal counsel of the Trust in connection with the Amendment, and I
hereby consent to the filing of this opinion with the Securities and Exchange
Commission as an exhibit thereto.

Very truly yours,

-----------------------------------
/s/ H. Day Brigham, Jr.
H. Day Brigham, Jr., Esq.
Vice President, Eaton Vance Management

HDB/EGW/drb

EXHIBIT 11

CONSENT OF INDEPENDENT ACCOUNTANTS

We consent to the inclusion in Post-Effective Amendment No. 13 to the
Registration Statement on Form N-1A (1933 Act File No. 2-73244) of Eaton Vance
Tax Free Reserves (the "Fund") of our report dated February 3, 1995 on our audit
of the financial statements and financial highlights of the Fund, which report
is included in the Annual Report to Shareholders for the year ended December 31,
1994, which is incorporated by reference in this Registration Statement.

We also consent to the reference to our Firm under the caption "The Fund's
Financial Highlights" in the Prospectus and under the caption "Independent
Accountants" in the Statement of Additional Information of the Registration
Statement.

COOPERS & LYBRAND L.L.P.

Boston, Massachusetts
April 18, 1995

EATON VANCE TAX FREE RESERVES

Quotation of Yield

For the seven day period ending December 31, 1994

The value of an account with a beginning balance of one share equal to $1.00
grew to $1.000707237. The difference of $0.000707237 is the Base Period Return.
Dividing the Base Period Return by the beginning value of $1.00 and multiplying
by (365/7) gives a yield of 3.69%.

Adding 1 to the Base Period Return and taking this to the power of (365/7) and
subtracting 1 gives an effective yield of 3.76%.

Taking the current yield of 3.69% and dividing by 1 minus the tax rate (assuming
a tax rate of 31%) gives a taxable equivalent current yield of 5.35%
(3.69%/.69).

Dividing the taxable equivalent yield by (365/7), adding 1, taking this to the
power of (365/7) and subtracting 1 gives a taxable equivalent effective yield of
5.49%.

<ARTICLE> 6
<CIK> 0000354212
<NAME> EATON VANCE TAX FREE RESERVES FUND
<MULTIPLIER> 1000

<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-END> DEC-31-1994
<INVESTMENTS-AT-COST> 33519
<INVESTMENTS-AT-VALUE> 33519
<RECEIVABLES> 1986
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 324
<TOTAL-ASSETS> 35829
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 6808
<TOTAL-LIABILITIES> 6808
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 29041
<SHARES-COMMON-STOCK> 29021
<SHARES-COMMON-PRIOR> 29032
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (20)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 29021
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 1149
<OTHER-INCOME> 0
<EXPENSES-NET> 220
<NET-INVESTMENT-INCOME> 929
<REALIZED-GAINS-CURRENT> (20)
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 909
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 929
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 4306
<NUMBER-OF-SHARES-REDEEMED> 4318
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> (31226)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 205
<INTEREST-EXPENSE> 27
<GROSS-EXPENSE> 381
<AVERAGE-NET-ASSETS> 40804
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.23
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (.23)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.54
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0

</TABLE>