FIDELITY INSTITUTIONAL CASH PORTFOLIOS - CLASS A
U.S. Treasury Portfolio
U.S. Treasury Portfolio II
U.S. Government Portfolio
Domestic Money Market Portfolio
82 DEVONSHIRE STREET
BOSTON, MASSACHUSETTS 02109
Money Market Portfolio
PROSPECTUS AND STATEMENT OF ADDITIONAL INFORMATION
Fidelity Institutional Cash Portfolios (the Fund) offers investors a
convenient and economical way to invest in professionally managed money
market portfolios (the Portfolios). Each Portfolio's investment
objective is to obtain as high a level of current income as is
consistent with the preservation of principal and liquidity within the
limitations prescribed for the Portfolio.
Each Portfolio is comprised of two classes of shares, Class A and Class B.
Both Classes share a common investment objective and investment portfolio.
Class A shares are offered through this Prospectus and Statement of
Additional Information to institutional and corporate investors. Class B
shares are offered through a separate prospectus.
AN INVESTMENT IN THE PORTFOLIOS IS NEITHER INSURED NOR GUARANTEED BY THE
U.S. GOVERNMENT AND THERE CAN BE NO ASSURANCE THAT THE PORTFOLIOS WILL
MAINTAIN A STABLE $1.00 SHARE PRICE.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS O F, OR GUARANTEED BY,
ANY DEPOSITORY INSTITUTION, NOR ARE THEY INSURED BY THE FDIC. INVESTMENT IN
THE PORTFOLIO(S) INVOLVES INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF
PRINCIPAL.
This Prospectus and Statement of Additional Information is designed to
provide investors with information that they should know before investing.
Please read and retain this document for future reference. The Annual
Report to Shareholders of the Fund is incorporated herein. To obtain
additional copies of this document, please call the number below.
For further information, or assistance in opening a new account, please
call:
NATIONWIDE 800-843-3001
TABLE OF CONTENTS
Summary of Expenses
Fund Summary
Financial Highlights
Investment Objective
Investment Policies, Risks and Limitations
How to Invest, Exchange and Redeem
Distributions and Taxes
Portfolio Transactions
Performance
Management Contracts, Distribution Plans
and Service Agreements
Description of the Fund
Appendix A
Appendix B
Financial Statements 33
LIKE ALL MUTUAL FUNDS, 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.
SUMMARY OF EXPENSES
The purpose of the table below is to assist investors in understanding the
various costs and expenses that an investor in Class A shares would bear
directly or indirectly. The expense summary format below was developed for
use by all mutual funds to help investors make their investment decisions.
T his expense information should be considered along with
other important information such as each Portfolio's investment objective
and past performance. There are no transaction expenses associated with
purchases, exchanges and redemptions of Class A shares.
A. ANNUAL OPERATING EXPENSES (AS A PERCENTAGE OF AVERAGE NET ASSETS)
FOR CLASS A SHARES OF EACH OF THE PORTFOLIOS:
DOMESTIC
U.S. U.S. U.S. MONEY MONEY
TREASURY TREASURY GOVERNMENT MARKET MARKET
PORTFOLIO PORTFOLIO II PORTFOLIO PORTFOLIO PORTFOLIO
Management Fee .15* .14* .14* .12* .15*
Other Expenses .03 .04 .04 .06 .03
Total Operating
Expenses .18% .18% .18% .18% .18%
* NET OF REIMBURSEMENT
B. EXAMPLE: An investor would pay the following expenses on a $1,000
investment in C lass A Shares of each Portfolio, assuming (1) a
5% annual return and (2) full redemption at the end of each time
period:
1 YEAR 3 YEARS 5 YEARS 10 YEARS
$2 $6 $10 $23
EXPLANATION OF TABLE:
A. ANNUAL OPERATING EXPENSES. Management fees are based on the Portfolios'
historical expenses after reimbursement. Management fees are paid by each
Portfolio to Fidelity Management & Research Company ("FMR" or the
"Adviser") for managing its investments and business affairs. The
Portfolios incur other expenses for maintaining shareholder records,
furnishing shareholder statements and reports, and other services. Subject
to revision upon 90 days' notice to shareholders, FMR has agreed to
r e imburse Class A of each Portfolio if and to the ex te nt that
total operating expenses (excluding interest, taxes, brokerage commissions,
and extraordinary expenses ) exceed an annual rate of .18% of
the average net assets of the Po rtfolio's Class A shares. If FMR had
not reimbursed Class A of each Portfolio, the respective Management Fees
and Total Operating Expenses for Class A shares of the Portfolios
would have been: .20 % and .23 % for U.S. Treasury Portfolio;
.20 % and .24 % for U.S. Treasury Portfolio II; .20 % and
.24 % for U.S. Government Portfolio; .20 % and .26 % for
Domestic Money Market Portfolio; and .20 % and .23 % for Money
Market Portfolio. Please refer to the section: "Management Contracts,
Distribution Plans and Service Agreements" on page for further
information.
B. EXAMPLE OF EXPENSES. The hypothetical example illustrates the expenses
associated with a $1,000 investment in Class A shares over periods
of 1, 3, 5 and 10 years, based on the expenses in the table and an assumed
annual rate of return of 5%. These figures reflect FMR's voluntary
reimbursement of expenses for Class A of each Portfolio. THE RETURN OF
5% AND EXPENSES SHOULD NOT BE CONSIDERED INDICATIONS OF ACTUAL OR EXPECTED
CLASS A PERFORMANCE OR EXPENSES, BOTH OF WHICH MAY VARY.
FUND SUMMARY
INVESTMENT OBJECTIVE AND POLICIES. Fidelity Institutional Cash Portfolios,
an open-end management investment company, offers institutional and
corporate investors a convenient and economical way to invest in a choice
of five professionally managed money market portfolios. Each Portfolio's
investment objective is to obtain as high a level of current income
as is consistent with the preservation of principal and liquidity within
the limitations prescribed for the Portfolio.
U.S. TREASURY PORTFOLIO AND U.S. TREASURY PORTFOLIO II. Comprised of
obligations which are issued or guaranteed as to principal and interest by
the U.S. government and thus constitute direct obligations of the United
States of America.
U.S. GOVERNMENT PORTFOLIO. Comprised of obligations issued or guaranteed as
to principal and interest by the U.S. government, its agencies or
instrumentalities (U.S. government obligations).
DOMESTIC MONEY MARKET PORTFOLIO. Comprised of highest quality, U.S.
dollar-denominated money market obligations of domestic issuers only. Under
normal conditions more than 25% of the Portfolio's total assets will be
invested in obligations of companies in the financial services industry.
MONEY MARKET PORTFOLIO. Comprised of a broad range of high quality ,
U.S. dollar-denominated money market obligations of domestic and foreign
issuers. Under normal conditions , more than 25% of the Portfolio's
total assets will be invested in obligations of companies in the financial
services industry.
Each Portfolio may engage in repurchase agreements and reverse repurchase
agreements; however, U.S. Treasury Portfolio II does not currently intend
to engage in reverse repurchase agreements. Domestic Money Market Portfolio
and Money Market Portfolio may purchase restricted securities. Other
permitted investments of these two Portfolios include bankers' acceptances,
certificates of deposit, time deposits and commercial paper . All five
Portfolio s may invest in variable rate obligations. See
"Investment Policies , Risks and Limitations, " page ,
for further information on each Portfolio's permitted investments.
INVESTING IN THE FUND. The Portfolios' Class A shares may be
purchased at the next determined net asset value per Class A share
(NAV). Each Portfolio requires a minimum initial investment of $5
million. Additional investments may be made in any amount. For
immediate acceptance of purchase orders, federal funds must be transmitted.
See "How to Invest," page .
REDEMPTION OF INVESTMENT. Investors may redeem all or any part of the value
of their accounts by instructing a Portfolio to redeem Class A
shares as described under "How to Redeem" on page . Redemptions may be
requested by telephone and are effected at the NAV next determined after
receipt and acceptance of the request. Amounts will be redeemed by
wire to the investor's designated bank account.
INVESTMENT ADVISER. F M R is the investment adviser to each
Portfolio . FMR, one of the largest investment management organizations
in the U nited S tates , serves as investment adviser to
investment companies which had aggregate net assets of more than $225
billion and approximately 15 million shareholder accounts as of April 30,
1994. FMR has entered into a sub-advisory agreement with FMR Texas Inc.
(FMR Texas), a subsidiary of FMR, pursuant to which FMR Texas has primary
responsibility for providing investment management services to each
Portfolio. See "Management Contracts, Distribution Plans and Service
Agreements," page .
FINANCIAL HIGHLIGHTS
The following tables give information about each Portfolio's
financial history. They use the Portfolios' fiscal year (which ends March
31) and express the information in terms of a single share outstanding
throughout the periods shown. The per-share data and ratios have been
audited by Price Waterhouse, independent accountants. Their unqualified
report is included on page 57 .
U.S. TREASURY PORTFOLIO**
<TABLE>
<CAPTION>
<S>
<C> <C> <C> <C> <C> <C> <C> <C> <C>
Years Ended March 31, November 9,
1985
(Commencement
of Operations) to
March 31,
1994 1993 1992 1991 1990 1989 1988 1987 1986
SELECTED PER-SHARE DATA
Net asset value, beginning
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
of period
Income from Investment
.030 .035 .053 .076 .088 .079 .065 .062 .030
Operations
Net interest income
Less Distributions
(.030) (.035) (.053) (.076) (.088) (.079) (.065) (.062) (.030)
From net interest income
Net asset value, end of period
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN (dagger)
3.08% 3.51% 5.48% 7.89% 9.15% 8.17% 6.65% 6.36% 3.02%
RATIOS AND SUPPLEMENTAL
DATA
Net assets, end of period (000
$ 1,611,877 $ 2,036,806 $ 2,629,072 $ 1,782,957 $ 1,721,126 $ 1,179,620 $ 650,114 $ 637,115 $ 239,945
omitted)
Ratio of expenses to average
.18% .18% .18% .18% .20% .20% .20% .20% .20%*
net assets (dagger)(dagger)
Ratio of expenses to average
.23% .23% .25% .24% .25% .26% .23% .25% .34%*
net assets before expense
reductions (dagger)(dagger)
Ratio of net interest income
3.03% 3.46% 5.29% 7.57% 8.72% 8.06% 6.45% 6.13% 7.56%*
to average net assets
</TABLE>
* ANNUALIZED
** AS OF MARCH 31, 1994, CLASS B SHARES FOR U.S. TREASURY PORTFOLIO, U.S.
GOVERNMENT PORTFOLIO, AND DOMESTIC MONEY MARKET PORTFOLIO WERE NOT
OPERATIONAL.
(dagger) TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT
ANNUALIZED AND WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
(dagger)(dagger) SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS.
<TABLE>
<CAPTION>
<S>
<C> <C> <C> <C> <C> <C> <C> <C>
U.S. TREASURY PORTFOLIO II - CLASS A February 2, 1987
(Commencement
Years Ended March 31, of
Operations) to
March 31,
1994 1993 1992 1991 1990 1989 1988 1987
SELECTED PER-SHARE DATA
Net asset value, beginning of
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
period
Income from
Investment Operations
Net interest income
.030 .034 .053 .076 .088 .078 .064 .009
Less Distributions
From net interest income
(.030) (.034) (.053) (.076) (.088) (.078) (.064) (.009)
Net asset value, end of period
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN (dagger)
3.06% 3.46% 5.41% 7.87% 9.13% 8.11% 6.60% .93%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period
$ 4,551,918 $ 5,589,663 $ 5,476,852 $ 3,281,686 $ 1,481,324 $ 658,068 $ 379,501 $ 26,314
(000 omitted)
Ratio of expenses to average
.18% .18% .18% .18% .19% .20% .20% .20%*
net assets (dagger)(dagger)
Ratio of expenses to average net
.24% .23% .25% .25% .27% .26% .32% .99%*
assets before expense
reductions (dagger)(dagger)
Ratio of net interest income to
3.01% 3.38% 5.12% 7.50% 8.63% 7.92% 6.46% 6.11%*
average net assets
</TABLE>
* ANNUALIZED
(dagger) TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT
ANNUALIZED AND WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
(dagger)(dagger) SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS.
U.S. TREASURY PORTFOLIO II - CLASS B
<TABLE>
<CAPTION>
<S> <C>
October 22,
1993
(Commencement
of
Operations) to
March 31, 1994
SELECTED PER-SHARE DATA
Net asset value, beginning of period $ 1.000
Income from Investment Operations
Net interest income .012
Less Distributions
From net interest income (.012)
Net asset value, end of period $ 1.000
TOTAL RETURN (dagger) 1.21%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted) $ 5,175
Ratio of expenses to average net assets (dagger)(dagger) .50%*
Ratio of expenses to average net assets before expense reductions (dagger)(dagger) .56%*
Ratio of net interest income to average net assets 2.69%*
</TABLE>
* ANNUALIZED
(dagger) TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT
ANNUALIZED AND WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED
DURING THE PERIOD SHOWN.
(dagger)(dagger) SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS.
<TABLE>
<CAPTION>
<S>
<c <C> <C> <C> <C> <C> <C> <C> <C>
U.S. GOVERNMENT PORTFOLIO** July 25, 1985
(Commencement
Years Ended March 31, of
Operations) to
March 31,
1994 1993 1992 1991 1990 1989 1988 1987 1986
SELECTED PER-SHARE DATA
Net asset value, beginning of
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
period
Income from Investment
.031 .035 .054 .077 .088 .079 .068 .063 .053
Operations
Net interest income
Less Distributions
(.031) (.035) (.054) (.077) (.088) (.079) (.068) (.063) (.053)
From net interest income
Net asset value, end of period
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN (dagger)
3.13 3.56 5.55 7.94 9.15 8.19 6.98 6.51 5.47%
% % % % % % % %
RATIOS AND SUPPLEMENTAL
DATA
Net assets, end of period (000
$ 3,764,544 $ 5,686,166 $ 4,603,781 $ 3,613,838 $ 2,815,622 $ 1,918,342 $ 1,878,786 $ 1,358,659 $ 511,720
omitted)
Ratio of expenses to average
.18 .18 .18 .18 .20 .20 .20 .20 .20%*
net
% % % % % % % %
assets (dagger)(dagger)
Ratio of expenses to average
.24 .24 .25 .25 .25 .24 .23 .25 .30%*
net assets before expense
% % % % % % % %
reductions (dagger)(dagger)
Ratio of net interest income to
3.07 3.50 5.33 7.62 8.74 7.90 6.78 6.28 7.81%*
average net assets
% % % % % % % %
</TABLE>
* ANNUALIZED
** AS OF MARCH 31, 1994, CLASS B SHARES FOR U.S. TREASURY PORTFOLIO, U.S.
GOVERNMENT PORTFOLIO, AND DOMESTIC MONEY MARKET PORTFOLIO WERE NOT
OPERATIONAL.
(dagger) TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT
ANNUALIZED AND WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
(dagger)(dagger) SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS.
<TABLE>
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<S>
<C> <C> <C> <C> <C>
DOMESTIC MONEY MARKET PORTFOLIO**
Years Ended March 31 November 3,
1989
(Commencement
of
Operations) to
March 31,
1994 1993 1992 1991 1990
SELECTED PER-SHARE DATA
Net asset value, beginning of period
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
Income from Investment Operations
.031 .034 .054 .078 .035
Net interest income
Less Distributions
(.031) (.034) (.054) (.078) (.035)
From net interest income
Net asset value, end of period
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN (dagger)
3.14% 3.50% 5.50% 8.11% 3.52%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted)
$ 656,976 $ 804,354 $ 558,727 $ 355,369 $ 330,974
Ratio of expenses to average net assets (dagger)(dagger)
.18% .18% .18% .18% .06%*
Ratio of expenses to average net assets before expense reductions (dagger)(dagger)
.26% .26% .29% .30% .43%*
Ratio of net interest income to average net assets
3.09% 3.43% 5.24% 7.79% 8.44%*
</TABLE>
* ANNUALIZED
** AS OF MARCH 31, 1994, CLASS B SHARES FOR U.S. TREASURY PORTFOLIO, U.S.
GOVERNMENT PORTFOLIO, AND DOMESTIC MONEY MARKET PORTFOLIO WERE NOT
OPERATIONAL.
(dagger) TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT
ANNUALIZED AND WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
(dagger)(dagger) SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS.
<TABLE>
<CAPTION>
<S>
<C> <C> <C> <C> <C> <C> <C> <C> <C>
MONEY MARKET PORTFOLIO - CLASS A July 5, 1985
(Commencemen
Years Ended March 31, t of
Operations) to
March 31,
1994 1993 1992 1991 1990 1989 1988 1987 1986
SELECTED PER-SHARE DATA
Net asset value, beginning of
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
period
Income from Investment
Operations
Net interest income
.032 .035 .055 .078 .089 .080 .069 .064 .059
Less Distributions
From net interest income
(.032) (.035) (.055) (.078) (.089) (.080) (.069) (.064) (.059)
Net asset value, end of period
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN (dagger)
3.20 3.58 5.59 8.13 9.25 8.35 7.14 6.57 6.01%
% % % % % % % %
RATIOS AND SUPPLEMENTAL
DATA
Net assets, end of period (000
$ 3,200,277 $ 4,332,995 $ 3,990,395 $ 4,706,936 $ 4,127,879 $ 2,627,450 $ 2,524,767 $ 1,569,199 $ 960,784
omitted)
Ratio of expenses to average
.18 .18 .18 .18 .20 .20 .20 .20 .19%*
net
% % % % % % % %
assets (dagger)(dagger)
Ratio of expenses to average
.23 .23 .24 .25 .24 .24 .23 .23 .28%*
net assets before
% % % % % % % %
expense reductions (dagger)(dagger)
Ratio of net interest income to
3.15 3.50 5.42 7.80 8.82 8.11 6.95 6.33 7.97%*
average net assets
% % % % % % % %
</TABLE>
* ANNUALIZED
(dagger) TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT
ANNUALIZED AND WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
(dagger)(dagger) SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS.
MONEY MARKET PORTFOLIO - CLASS B
<TABLE>
<CAPTION>
<S> <C>
November 17,
1993
(Commencement
of
Operations) to
March 31, 1994
SELECTED PER-SHARE DATA
Net asset value, beginning of period $ 1.000
Income from Investment Operations
Net interest income .011
Less Distributions
From net interest income (.011)
Net asset value, end of period $ 1.000
TOTAL RETURN (dagger) 1.08%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted) $ 89,463
Ratio of expenses to average net assets (dagger)(dagger) .50%*
Ratio of expenses to average net assets before expense reductions (dagger)(dagger) .55%*
Ratio of net interest income to average net assets 2.83%*
</TABLE>
* ANNUALIZED
(dagger) TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT
ANNUALIZED AND WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED
DURING THE PERIOD SHOWN.
(dagger)(dagger) SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS.
INVESTMENT OBJECTIVE
The investment objective of each Portfolio is to obtain as high a level of
current income as is consistent with the preservation of principal and
liquidity within the standards prescribed for the Portfolio. There is no
assurance that a Portfolio will achieve its investment objective.
INVESTMENT POLICIES, RISKS AND LIMITATIONS
The Fund consists of five individual Portfolios, differentiated in terms of
their permitted investments or investment techniques. Each Portfolio seeks
to maintain a $1.00 share price at all times. The permitted investments of
the Portfolios are as follows:
U.S. TREASURY PORTFOLIO (TREASURY PORTFOLIO) currently maintains an
operating policy of investing at least 65% of its total assets in U.S.
Treasury bills, notes and bonds and repurchase agreements backed by those
obligations. The balance of its assets may be invested in other direct
obligations of the United States.
U.S. TREASURY PORTFOLIO II (TREASURY PORTFOLIO II) currently
maintains an operating policy of investing 100% of its total assets in U.S.
Treasury bills, notes and bonds and other direct obligations of the U.S.
Treasury. The Portfolio may also engage in repurchase agreements backed by
those obligations.
(bullet) Each of the above operating policies for Treasury Portfolio and
Treasury Portfolio II may be changed upon 90 days' notice to
shareholders. In the case of such notification, each Portfolio would be
permitted to invest in instruments which are issued or guaranteed as to
principal and interest by the U.S. government and thus constitute direct
obligations of the United States. Direct U.S. government obligations
include such instruments as U.S. Treasury bills, notes and bonds and
instruments issued by such Federal agencies as the Export-Import Bank of
the U nited States , the General Services Administration, the
Government National Mortgage Association, the Small Business Administration
and the Washington Metropolitan Area Transit Authority. The Portfolios will
not invest in securities issued or guaranteed by U.S. government agencies,
instrumentalities, or government-sponsored enterprises that are not backed
by the full faith and credit of the United States .
U.S. GOVERNMENT PORTFOLIO (GOVERNMENT PORTFOLIO) invests in U.S. government
obligations issued or guaranteed as to principal and interest by the U.S.
government, including bills, notes, bonds and other U.S. Treasury debt
securities; and instruments issued by U.S. government instrumentalities or
agencies (agency obligations). These instruments include:
(bullet) obligations of the Federal Home Loan Banks, Federal Farm Credit
Banks, and Federal National Mortgage Association, which are backed only by
the right of the issuer to borrow from the U.S. Treasury under certain
circumstances or are backed by the credit of the agency or instrumentality
issuing the obligation. Such agency obligations are not deemed direct
obligations of the United States, and therefore involve more risk.
DOMESTIC MONEY MARKET PORTFOLIO (DOMESTIC PORTFOLIO) invests in U.S.
dollar-denominated money market instruments of domestic issuers rated in
the highest rating category by at least two nationally recognized rating
services, or by one if only one rating service has rated an obligation. The
Portfolio may purchase unrated obligations determined to be of equivalent
quality pursuant to procedures adopted by the Board of Trustees. The
Portfolio's investments include:
(bullet) obligations of companies in the financial services industry,
including domestic banks, savings and loan associations, consumer and
industrial finance companies, securities brokerage companies and a variety
of firms in the insurance field. (These obligations include time deposits,
certificates of deposit, bankers' acceptances and commercial paper.) Under
normal conditions, the Portfolio will invest more than 25% of its total
assets in obligations of companies in the financial services
industry ;
(bullet) obligations of governments and their agencies and
instrumentalities ;
(bullet) short-term corporate obligations, including commercial paper,
notes and bonds ; and
(bullet) other short-term debt obligations.
MONEY MARKET PORTFOLIO invests in high quality, U.S. dollar-denominated
money market instruments of domestic and foreign issuers, such as:
(bullet) obligations of companies in the financial services industry,
including U.S. branches of both foreign and domestic banks, savings and
loan associations, consumer and industrial finance companies, securities
brokerage companies and a variety of firms in the insurance field. (These
obligations include time deposits, certificates of deposit, bankers'
acceptances and commercial paper.) Under normal conditions, the Portfolio
will invest more than 25% of its total assets in obligations of companies
in the financial services industry ;
(bullet) obligations of governments and their agencies and
instrumentalities ;
(bullet) short-term corporate obligations, including commercial paper,
notes and bonds ; and
(bullet) other short-term debt obligations.
To the extent that either Domestic Portfolio or Money Market Portfolio
invests more than 25% of its assets in obligations of companies in the
financial services industry, it will be exposed to greater risks associated
with that industry as a whole. Domestic Portfolio and Money Market
Portfolio may invest in restricted securities. In addition, Money Market
Portfolio may invest in obligations of U.S. banks, foreign branches of U.S.
and foreign banks (Eurodollars), and U.S. branches and agencies of
foreign banks (Yankee dollars). Eurodollar and Yankee dollar investments
involve risks that are different from investments in securities of U.S.
banks. (See Appendix A. )
REGULATORY REQUIREMENTS. The following is a brief summary of regulatory
requirements applicable to all money market funds which limit certain of
the Portfolios' investment policies, though some of the Portfolios may
follow more restrictive policies as described above.
(bullet) QUALITY. Pursuant to procedures adopted by the Board of Trustees,
each Portfolio may purchase only high quality securities that FMR believes
present minimal credit risks. To be considered high quality, a security
must be: a U.S. government security; rated in accordance with applicable
rules in one of the two highest categories for short-term securities by at
least two nationally recognized rating services (or by one, if only one
rating service has rated the security); or, if unrated, judged to be of
equivalent quality by FMR.
High quality securities are divided into "first tier" and "second tier"
securities. First tier securities have received the highest rating (e.g.,
S&P A-1 rating) from at least two rating services (or one, if only one
has rated the security). Second tier securities have received ratings
within the two highest categories (e.g., S&P A-1 or A-2) from at least
two rating services (or one, if only one has rated the security), but do
not qualify as first tier securities. If a security has been assigned
different ratings by different rating services, at least two rating
services must have assigned the higher rating in order for FMR to determine
eligibility on the basis of that higher rating. Based on procedures adopted
by the Board of Trustees, FMR may determine that an unrated security is of
equivalent quality to a security rated first or second tier.
Money Market Portfolio may not invest more than 5% of its total assets in
second tier securities. In addition, Money Market Portfolio may not invest
more than 1% of its total assets or $1 million (whichever is greater) in
the second tier securities of a single issuer.
(bullet) MATURITY. Each Portfolio must limit its investments to securities
with remaining maturities of 397 days or less and must maintain a
dollar-weighted average maturity of 90 days or less.
(bullet) DIVERSIFICATION. Neither Domestic Money Market Portfolio,
nor Money Market Portfolio may invest more than 5% of its total
assets in the securities (other than U.S. government securities) of any
single issuer. Under certain conditions, however, each Portfolio may invest
up to 10% of its total assets in the first tier securities of a single
issuer for up to three days.
INVESTMENT TECHNIQUES. Each Portfolio may engage in repurchase agreements
with respect to any category of securities in which it is entitled to
invest, even if the maturity of these securities is greater than 397
days . Each Portfolio, except Treasury Portfolio II, also may engage in
reverse repurchase agreements to raise cash temporarily or to attempt to
increase income. Shareholders of Treasury Portfolio II will be notified
should the Portfolio change its policies concerning reverse repurchase
agreements.
See Appendix A on page 28 for further information on the
Portfolios' investment techniques, including repurchase and reverse
repurchase agreements, and Appendix B on page for a description of
rating categories.
The investment objective and policies set forth above are supplemented by
each Portfolio's investment limitations beginning below . Each
Portfolio's objective is fundamental; however, its investment policies and
limitations, unless otherwise indicated, are not fundamental, and may be
changed without shareholder approval.
SUITABILITY
The Fund is designed as an economical and convenient vehicle for those
institutional and corporate investors with cash balances or cash reserves
seeking to obtain the yields available from money market instruments while
maintaining liquidity. The ability to select from among the Portfolios
allows investors to choose that Portfolio, or combination of Portfolios,
which best suits their particular investment goals.
Each Portfolio's ability to achieve its investment objective depends on the
quality and maturity of its investments. Although the Portfolios'
investment policies are designed to maintain a stable $1.00 share
price, all money market instruments can change in value when interest rates
or issuers' creditworthiness change, or if an issuer or a guarantor of a
security fails to pay interest or principal when due. If these changes in
value were large enough, a Portfolio's share price could fall below $1.00.
In general, securities with longer maturities are more vulnerable to price
changes, although they may provide higher yields.
The Portfolios offer the advantages of large purchasing power and
diversification. Generally, in purchasing money market instruments from
dealers, the percentage difference between the bid and asked prices tends
to decrease as the size of the transaction increases. The Portfolios
also offer investors the opportunity to participate in a portfolio of money
market instruments which is more diversified in terms of issuers and
maturities than the size the investor's investment might otherwise permit.
Investment in a Portfolio relieves the investor of many management
and administrative burdens usually associated with the direct purchase and
sale of money market instruments. These include selection of portfolio
investments; surveying the market for the best terms at which to buy and
sell; scheduling and monitoring maturities and reinvestments; receipt,
delivery and safekeeping of securities; and portfolio recordkeeping.
INVESTMENT LIMITATIONS
Unless otherwise noted, whenever an investment policy or limitation
states a maximum percentage of a Portfolio's assets that may be invested in
any security or other asset or sets forth a policy regarding quality
standards, such standard or percentage limitation shall be determined
immediately after and as a result of a Portfolio's acquisition of such
security or other asset. Accordingly, any subsequent change in values, net
assets or other circumstances will not be considered when determining
whether the investment complies with a Portfolio's investment policies and
limitations.
The Portfolios' fundamental investment policies and limitations may not
be changed without approval by a "majority of the outstanding voting
securities" (as defined in the Investment Company Act of 1940) of the
Portfolios. However, except for the fundamental investment limitations set
forth below, the investment policies and limitations described in this
combined Prospectus and Statement of Additional Information are not
fundamental and may be changed without shareholder approval. THE
FOLLOWING ARE THE PORTFOLIOS' FUNDAMENTAL INVESTMENT LIMITATIONS SET FORTH
IN THEIR ENTIRETY. EACH PORTFOLIO MAY NOT:
(1) purchase the securities of any issuer (other than obligations issued
or guaranteed as to principal and interest by the government of the United
States, its agencies or instrumentalities) if, as a result, more than 5% of
its total assets would be invested in the securities of such issuer,
provided, however, that with respect to 25% of its total assets, 10% of its
assets may be invested in the securities of an issuer;
(2) issue senior securities, except as permitted under the Investment
Company Act of 1940;
(3) borrow money, except that the Portfolio may (i) borrow money for
temporary or emergency purposes (not for leveraging or investment) and (ii)
engage in reverse repurchase agreements for any purpose; provided that (i)
and (ii) in combination do not exceed 33 1/3% of the value of the
Portfolio's total assets (including the amount borrowed) less liabilities
(other than borrowings). Any borrowings that come to exceed this amount
will be reduced within three days (not including Sundays and holidays) to
the extent necessary to comply with the 33 1/3% limitation;
(4) underwrite securities issued by others, except to the extent that
the Portfolio may be considered an underwriter within the meaning of the
Securities Act of 1933 in the disposition of restricted securities;
(5) purchase the securities of any issuer (other than securities issued
or guaranteed by the U.S. government or any of its agencies or
instrumentalities) if, as a result, more than 25% of the Portfolio's total
assets would be invested in the securities of companies whose principal
business activities are in the same industry, except that Domestic
Portfolio and Money Market Portfolio will invest more than 25% of its total
assets in the financial services industry;
(6) buy or sell real estate;
(7) lend any security or make any other loan if, as a result, more than
33 1/3% of its total assets would be lent to other parties, but this
limitation does not apply to purchases of debt securities or to repurchase
agreements;
(8) invest in oil, gas, or other mineral exploration or development
programs; or
(9) invest in companies for the purpose of exercising control or
management.
(10) Each Portfolio may, notwithstanding any other fundamental
investment policy or limitation, invest all of its assets in the securities
of a single open-end management investment company with substantially the
same fundamental investment objectives, policies and limitations as the
Portfolio.
THE FOLLOWING LIMITATIONS ARE NOT FUNDAMENTAL, AND MAY BE CHANGED
WITHOUT SHAREHOLDER APPROVAL:
(i) Domestic Portfolio and Money Market Portfolio each do not currently
intend to purchase a security (other than a security issued or guaranteed
by the U.S. government or any of its agencies or instrumentalities) if, as
a result, more than 5% of its total assets would be invested in the
securities of a single issuer; provided that the Portfolio may invest up to
10% of its total assets in the first tier securities of a single issuer for
up to three business days.
(ii) Each Portfolio does not currently intend to sell securities short,
unless it owns or has the right to obtain securities equivalent in kind and
amount to the securities sold short, and provided that transactions in
futures contracts and options are not deemed to constitute selling
securities short.
(iii) Each Portfolio does not currently intend to purchase securities on
margin, except that the Portfolio may obtain such short-term credits as are
necessary for the clearance of transactions, and provided that margin
payments in connection with futures contracts and options on futures
contracts shall not constitute purchasing securities on margin.
(iv) Each Portfolio may borrow money only (a) from a bank or from a
registered investment company or portfolio for which FMR or an affiliate
serves as investment adviser or (b) by engaging in reverse repurchase
agreements with any party. Each Portfolio will not purchase any security
while borrowings (excluding reverse repurchase agreements) representing
more than 5% of its total assets are outstanding. Each Portfolio will not
borrow from other funds advised by FMR or its affiliates if total
outstanding borrowings immediately after such borrowing would exceed 15% of
the Portfolio's total assets. Treasury Portfolio II does not currently
intend to engage in reverse repurchase agreements.
(v) Each Portfolio does not currently intend to purchase any security
if, as a result, more than 10% of its net assets would be invested in
securities that are deemed to be illiquid because they are subject to legal
or contractual restrictions on resale or because they cannot be sold or
disposed of in the ordinary course of business at approximately the prices
at which they are valued.
(vi) Subject to 60 days' notice to its shareholders, each Portfolio does
not currently intend to purchase or sell futures contracts or call options.
This limitation does not apply to options attached to, or acquired or
traded together with, their underlying securities and does not apply to
securities that incorporate features similar to options or futures
contracts.
(vii) Domestic Portfolio and Money Market Portfolio do not currently
intend to lend assets other than securities to other parties, except by
lending money (up to 10% of each Portfolio's net assets) to a registered
investment company or portfolio for which FMR or an affiliate serves as
investment adviser. (This limitation does not apply to purchases of debt
securities or to repurchase agreements.)
(viii) Each Portfolio does not currently intend to (a) purchase
securities of other investment companies, except in the open market where
no commission except the ordinary broker's commission is paid, or (b)
purchase or retain securities issued by other open-end investment
companies. Limitations (a) and (b) do not apply to securities received as
dividends, through offers of exchange, or as a result of a reorganization,
consolidation, or merger.
(ix) Treasury Portfolio, Treasury Portfolio II and Government Portfolio
do not currently intend to make loans, but this limitation does not apply
to purchases of debt securities or to repurchase agreements.
(x) Each Portfolio does not currently intend to invest in securities of
real estate investment trusts that are not readily marketable, or to invest
in securities of real estate limited partnerships that are not listed on
the New York Stock Exchange or the American Stock Exchange or traded on the
NASDAQ National Market System.
(xi) Each Portfolio does not currently intend to purchase the securities
of any issuer if those officers and Trustees of the Fund and those officers
and directors of FMR who individually own more than 1/2 of 1% of the
securities of such issuer together own more than 5% of such issuer's
securities.
(xii) Each Portfolio does not currently intend to invest in oil, gas, or
other mineral exploration or development programs or leases.
(xiii) Each Portfolio does not currently intend to invest all of its
assets in the securities of a single open-end management investment company
with substantially the same fundamental investment objectives, policies,
and limitations as the Portfolio.
HOW TO INVEST, EXCHANGE AND REDEEM
Class A s hares of each Portfolio are offered continuously and may be
purchased at the NAV next determined after an order is received and
accepted. The Portfolios do not impose any sales charges in connection with
purchases of their Class A shares, although institutions may charge
their clients fees in connection with purchases and sales for the accounts
of their clients. Investments in the Portfolios must be made using the
Federal Reserve Wire System. Checks will not be accepted as a means of
investment.
SHARE PRICE AND DIVIDENDS. The NAV for Class A shares of Treasury
Portfolio, Government Portfolio, Domestic Money Market Portfolio, and Money
Market Portfolio is determined by Fidelity Service Co. (Service), 82
Devonshire Street, Boston, MA 02109 as of 3:00 p.m . Eastern time,
each day the Portfolios are open for business. (See "Holiday Schedule" on
page .) The NAV for Class A shares of Treasury Portfolio II will be
determined at 3:00 p.m. and 5:00 p.m. Eastern time. Shareholders of record
as of 3:00 p.m. (5:00 p.m. for Treasury Portfolio II) will be entitled to
that day's dividend. The NAV is determined by adding the value of all
securities and other assets of Class A of the Portfolio, deducting
the actual and accrued liabilities allocated to Class A
shares , and dividing by the number of Class A shares
outstanding. (See "How Net Asset Value is Determined" on page ).
Class A's net interest income for dividend purposes is determined by
Service on a daily basis and shall be declared to shareholders of record at
the time of its declaration (including, for this purpose, holders of shares
purchased, but excluding holders of shares redeemed on that day). The
dividend declared for Treasury Portfolio II is based on estimates of net
interest income for the Portfolio. Actual income may differ from estimates
and differences, if any, will be included in the calculation of subsequent
dividends. Income dividends declared are accrued daily throughout the
month and are distributed in the form of full and fractional Class A
shares on the first business day of the following month. Based on prior
approval of the Fund, dividends relating to Class A shares redeemed
during the month can be distributed in the form of full and fractional
Class A shares on the day of redemption. The Fund reserves the right
to limit this service. The shareholder may elect to receive monthly
dividends in cash.
MINIMUM INVESTMENT AND ACCOUNT BALANCE. The minimum initial investment to
establish a new account in Class A shares of each Portfolio is $ 5
million . Subsequent investments may be made in any amount. To keep an
account open, please leave $5 million in it. If an account balance
falls below $5 million due to redemption, the account may be closed
and the proceeds wired to the bank account of record. An investor will be
given 30 days' notice that the account will be closed unless an additional
investment is made to increase the account balance to the $5 million
minimum.
HOW TO INVEST. An initial investment in Class A of a Portfolio must
be preceded or accompanied by a completed, signed application. Unless you
already have a Fidelity mutual fund account, you must complete and sign the
application. The application should be forwarded to:
Fidelity Client Services
c/o Fidelity Institutional Cash Portfolios
FIIOC, ZR5
P.O. Box 1182
Boston, MA 02103-1182
An investor must purchase Class A shares of each Portfolio by wire.
For wiring information and instructions, investors should call the
institution through which they trade or Fidelity Client Services. There is
no charge imposed by the Fund for the wire; however, banks may charge a fee
for this service.
In order to receive same day acceptance of the investment, investors must
telephone Institutional Trading before 3:00 p.m., Eastern time, on days the
Portfolios are open for business, to advise them of the wire and to place
the trade.
In order to receive same day acceptance of investment in Treasury
Portfolio II after 3:00 p.m., investors must telephone Institutional
Trading before 5:00 p.m. Eastern time to place the trade and must obtain a
wire reference number for each trade. It is necessary to obtain a new wire
reference number for each purchase placed in the Portfolio after 3:00 p.m.
Eastern time. Wire reference numbers are assigned exclusively by means of
telephone communication and are effective for one transaction only and may
not be used more than once. WIRED MONEY FOR PURCHASES PLACED AFTER 3:00
P.M. THAT IS NOT PROPERLY IDENTIFIED WITH A CURRENTLY EFFECTIVE WIRE
REFERENCE NUMBER WILL BE RETURNED TO THE BANK FROM WHICH IT WAS WIRED AND
WILL NOT BE CREDITED TO THE SHAREHOLDER'S ACCOUNT.
FIDELITY CLIENT SERVICES:
NATIONWIDE 800-843-3001
INSTITUTIONAL TRADING:
NATIONWIDE 800-343-6310
IN MASSACHUSETTS 800-462-2603
Investors will be entitled to the dividend declared on Class A shares
by a Portfolio provided the Portfolio's custodian bank receives the
wire by the close of the Federal Reserve Wire System on the day the
purchase order is accepted. Investors are advised to wire funds as early in
the day as possible, and to provide advance notice to Institutional Trading
for large transactions.
HOW TO EXCHANGE. Each Portfolio's Class A shares may be exchanged
(subject to the minimum initial investment requirement) at no charge for
Class A shares of any other Portfolio of the Fund or for shares of Fidelity
Institutional Tax-Exempt Cash Portfolios, provided the portfolio to be
acquired is registered in an investor's state. Investors whose orders to
exchange out of Treasury Portfolio II are received between 3:00 and 5:00
p.m. may not be invested for one day, depending on the time at which orders
are accepted by the portfolio into which they are exchanging. You may
only exchange between accounts that are registered in the same name,
address, and taxpayer identification number. Exchanges will not be
permitted until a completed and signed mutual fund application is on file.
Investors should consult the prospectus of the portfolio to be acquired to
determine eligibility and suitability.
TO EXCHANGE BY TELEPHONE. Exchanges may be requested on any day the
Portfolios are open for business by calling Institutional Trading before
3:00 p.m. Eastern time (5:00 p.m. for Treasury Portfolio II) at the
numbers listed above .
TO EXCHANGE BY MAIL. Written requests for exchanges should contain the
Portfolio name, account number, and number of Class A shares to be
redeemed, and the name of the portfolio to be purchased. The letter
must be signed by a person authorized to act on the account and must
include a signature guarantee. Signature guarantees will be accepted from
banks, brokers, dealers, municipal securities dealers, municipal securities
brokers, government securities dealers, government securities brokers,
credit unions (if authorized under state law), national securities
associations, clearing agencies and savings associations. Letters should be
sent to Fidelity Client Services at the address shown above .
An exchange involves the redemption of all or a portion of the shares of
one portfolio and the purchase of shares of another portfolio.
Class A s hares will be redeemed at the next determined NAV following
receipt of the exchange order. S hares of the portfolio to be
acquired will be purchased at their next determined NAV after
redemption proceeds are made available. Investors will earn dividends in
the acquired portfolio in accordance with the portfolio's customary policy,
normally on the day the exchange request is received. Investors should note
that under certain circumstances, a Portfolio may take up to seven days to
make redemption proceeds available for the exchange purchase of another
p ortfolio.
Pursuant to Rule 11a-3 under the 1940 Act, each Portfolio is required to
give shareholders at least 60 days' notice prior to terminating or
modifying a Portfolio's exchange privilege. Under Rule 11a-3, the 60-day
notification requirement may be waived if (i) the only effect of a
modification would be to reduce or eliminate an administrative fee,
redemption fee or deferred sales charge ordinarily payable at the time of
exchange, or (ii) a p ortfolio suspends the redemption of the shares
to be exchanged as permitted under the 1940 Act or the rules and
regulations thereunder, or the p ortfolio to be acquired suspends
sale of its shares because it is unable to invest amounts effectively in
accordance with its investment objective and policies.
E ach Portfolio reserves the right at any time without prior notice
to refuse exchange purchases by any person or group, if, in FMR's judgment,
the Portfolio would be unable to invest effectively in accordance with its
investment objective and policies or might otherwise be adversely affected.
The exchange privilege may be modified or terminated in the future.
HOW TO REDEEM. Shareholders may redeem all or any part of the value of
their account(s) on any business day. Redemptions may be requested by
telephone and are effected at the NAV next determined after receipt of the
redemption request.
Shareholders must designate on their applications their U.S. commercial
bank account(s) into which they wish the proceeds of redemptions to be
deposited. A shareholder may change the bank account(s) designated to
receive amounts redeemed at any time prior to making a redemption request.
A letter of instruction, including a signature guarantee, should be sent to
Fidelity Client Services at the address shown above .
Redemption proceeds will be wired via the Federal Reserve Wire System to a
bank account of record on the same day a redemption request is received,
provided it is made before 3:00 p.m. Eastern time. In the case of
Treasury Portfolio II, redemption proceeds will be wired via the Federal
Reserve Wire System to a bank account of record on the same day a
redemption request is received, provided it is received before 5:00 p.m.
Eastern time. Class A s hares redeemed will not receive the dividend
declared on the day of redemption. Redemption requests can be made by
calling Institutional Trading . There is no charge imposed for wiring of
redemption proceeds.
If Class A shares redeemed represent an investment made via clearing
house funds, each Portfolio reserves the right to withhold the redemption
proceeds until it is reasonably assured of the crediting of such funds to
its account.
Under the 1940 Act, the right of redemption may be suspended or the date of
payment postponed for more than seven days at times when the New York Stock
Exchange (NYSE) is closed, other than customary weekend or holiday
closings, or when trading on the NYSE is restricted, or under certain
emergency circumstances as determined by the S ecurities and Exchange
Commission (SEC) . If investors are unable to execute a transaction by
telephone (for example, during time of unusual market activity) they may
consider placing their orders by mail. In case of the suspension of the
right of redemption, investors may either withdraw their requests for
redemption or receive payment based on the NAV next determined after
termination of the suspension.
ADDITIONAL INFORMATION. Investors may initiate many transactions by
telephone. Note that Fidelity will not be responsible for any losses
resulting from unauthorized transactions if it follows reasonable
procedures designed to verify the identity of the caller. Fidelity will
request personal information for security purposes , and may also record
calls. Investors should verify the accuracy of their confirmation
statements immediately after receiving them. Investors that do not
want the ability to redeem and exchange by telephone should call
Fidelity for instructions.
To allow the Adviser to manage the Portfolios most effectively, investors
are strongly urged to initiate all trades (investments in , or
exchanges or redemptions of Class A shares) as early in the day
as possible and to notify Fidelity Client Services at least one day in
advance of transactions in excess of $5 million. In making these trade
requests, the name of the registered shareholder and the account number
must be supplied for each transaction. To protect each Portfolio's
performance and shareholders, the Adviser discourages frequent trading in
response to short-term market fluctuations.
In order to invest or redeem from Treasury Portfolio II after 3:00 p.m.,
investors must contact their client service representative one week in
advance to establish the requisite operational requirements for late
trading. Even after these procedures are in place, investors are encouraged
to execute as many trades as possible prior to 3:00 p.m. The Portfolio
reserves the right to refuse any investment that would, in its sole
discretion, be disruptive of the Portfolio's management.
If the Trustees determine that existing conditions make cash payments
undesirable, redemption payments may be made in whole or in part in
securities or other property, valued for this purpose as they are valued in
computing the NAV for each Portfolio's Class A shares .
Shareholders receiving securities or other property on redemption may
realize a gain or loss for tax purposes, and will incur any costs of sale,
as well as the associated inconveniences.
Each Portfolio reserves the right to suspend the offering of Class A
shares for a period of time, and each Portfolio reserves the right to
reject any specific purchase order including certain purchases by exchange.
Purchase orders may be refused if, in FMR's opinion, they are of a size
that would disrupt management of the Portfolios. Each Portfolio may
discontinue offering its shares at any time or in any particular state
without notice to shareholders.
INVESTOR ACCOUNTS. Fidelity Investments Institutional Operations Company
(FIIOC) is the transfer, dividend disbursing and shareholder servicing
agent for the Fund and maintains an account for each investor expressed in
terms of full and fractional Class A shares of each Portfolio
rounded to the nearest 1/1000th of a share.
The Fund does not issue share certificates, but FIIOC will send investors a
confirmation statement after every transaction (except a reinvestment of
dividends or capital gains) that affects the Class A share balance
or the account registration. After the end of each month, FIIOC will send
each investor a statement setting forth the transactions in their account
for the month and the month-end balance of full and fractional Class A
shares held in the account.
SUBACCOUNTING AND SPECIAL SERVICES. Special processing has been arranged
with FIIOC for banks, corporations and other institutions that wish to open
multiple accounts (a master account and subaccounts). An investor wishing
to utilize FIIOC's subaccounting facilities or other special services for
individual or multiple accounts will be required to enter into a separate
agreement with FIIOC. Charges for these services, if any, will be
determined on the basis of the level of services to be rendered.
Subaccounts may be opened with the initial investment or at a later date.
HOLIDAY SCHEDULE. Each Portfolio is open for business and its Class A
NAV is calculated every day that both the Federal Reserve Bank of
New York ( New York Fed) and the NYSE are open for trading.
The following holiday closings have been scheduled for 1994: Dr. Martin
Luther King, Jr. Day (observed), Presidents' Day, Good Friday, Memorial
Day, Independence Day (observed), Labor Day, Columbus Day, Veterans' Day,
Thanksgiving Day and Christmas Day (observed). Although FMR expects the
same holiday schedule, with the addition of New Year's Day, to be observed
in the future, the New York Fed or the NYSE may modify its holiday
schedule at any time. The right is reserved to advance the time on that day
by which purchase and redemption orders must be received on any day that:
(1) the New York Fed or the NYSE closes early or, in the case of
Treasury Portfolio II, the principal government securities markets close
early, such as on days in advance of holidays generally observed by
participants in such markets; (2) if , in FMR's judgment, early
closing is deemed to be in the best interest of each Portfolio's
shareholders; or, (3) as permitted by the SEC. To the extent that each
Portfolio's securities are traded in other markets on days the New
York Fed or the NYSE is closed, each Portfolio's Class A NAV may
be affected when investors do not have access to the Portfolio to purchase
or redeem Class A shares. Certain Fidelity funds may follow
different holiday closing schedules.
HOW NET ASSET VALUE IS DETERMINED. Each Portfolio values its investments on
the basis of amortized cost. This technique involves valuing an instrument
at its cost as adjusted for amortization of premium or accretion of
discount rather than its value based on current market quotations or
appropriate substitutes which reflect current market conditions. The
amortized cost value of an instrument may be higher or lower than the price
a Portfolio would receive if it sold the instrument.
Valuing a Portfolio's instruments on the basis of amortized cost and use of
the term "money market fund" are permitted by Rule 2a-7 under the 1940 Act.
The Portfolios must adhere to certain conditions under Rule 2a-7; these
conditions are summarized under "Regulatory Requirements" on page 9 .
The Board of Trustees of the Fund oversees FMR's adherence to SEC rules
concerning money market funds, and has established procedures designed to
stabilize each Portfolio's NAV for each class at $1.00. At such intervals
as they may deem appropriate, the Trustees consider the extent to which NAV
calculated by using market valuations would deviate from $1.00. If the
Trustees believe that a deviation from a Portfolio's amortized cost per
share may result in material dilution or other unfair results to
shareholders, the Trustees have agreed to take such corrective action, if
any, as they deem appropriate to eliminate or reduce, to the extent
reasonably practicable, the dilution or unfair results. Such corrective
action could include selling portfolio instruments prior to maturity to
realize capital gains or losses or to shorten average portfolio maturity;
withholding dividends; redeeming shares in kind; establishing NAV by using
available market quotations; and such other measures as the Trustees may
deem appropriate.
During periods of declining interest rates, a Portfolio's yield based on
amortized cost may be higher than such Portfolio's yield based on
market valuations. Under these circumstances, a shareholder in a Portfolio
would be able to obtain a somewhat higher yield than would result if the
Portfolio utilized market valuations to determine its NAV. The converse
would apply in a period of rising interest rates.
DISTRIBUTIONS AND TAXES
DIVIDENDS. Each Portfolio ordinarily declares dividends from net investment
income daily and pays such dividends monthly. Each Portfolio intends to
distribute substantially all of its net investment income and capital
gains, if any, to shareholders within each calendar year as well as on a
fiscal year basis.
Dividends from the Portfolios will not normally qualify for the
dividends-received deduction available to corporations, since a Portfolio's
income is primarily derived from interest income and short-term capital
gains. Depending upon state law, a portion of each Portfolio's dividends
attributable to interest income derived from U.S. government securities may
be exempt from state and local taxation. The Portfolios will provide
information on the portion of each Portfolio's dividends, if any, that
qualify for this exemption.
CAPITAL GAIN DISTRIBUTIONS. The Portfolios may distribute short-term
capital gains once a year or more often as necessary to maintain their NAV
at $1.00 per share or to comply with distribution requirements under
federal tax law. The Portfolios do not anticipate earning long-term capital
gains on securities held by the Portfolios.
FEDERAL TAXES. Dividends derived from net investment income and short-term
capital gains are taxable as ordinary income. Distributions are taxable
when paid, whether investors receive distributions in cash or reinvest them
in additional shares, except that distributions declared in December and
paid in January are taxable as if paid on December 31st. The Portfolios
will send investors an IRS Form 1099-DIV by January 31st showing their
taxable distributions for the past calendar year.
STATE AND LOCAL TAX ISSUES. For mutual funds organized as business trusts,
state law provide s for a pass-through of the state and local income
tax exemption afforded to direct owners of U.S. government securities.
Some states limit this pass-through to mutual funds that invest a
certain amount in U.S. government securities, and some types of securities,
such as repurchase agreements and some agency backed securities, may not
qualify for this pass-through benefit. The tax treatment of your dividend
distributions from the fund will be the same as if you directly owned your
proportionate share of the U.S. government securities in the fund's
portfolio. Because the income earned on most U.S. government securities in
which the fund invests is exempt from state and local income taxes, the
portion of your dividend from the fund attributable to these securities
will also be free from income taxes. The exemption from state and local
income taxation does not preclude states from assessing other taxes on the
ownership of U.S. government securities.
TAX STATUS OF THE FUND. Each Portfolio has qualified and intends to
continue to qualify as a "regulated investment company" under the Internal
Revenue Code of 1986 (the Code), as amended , so that a
Portfolio will not be liable for federal income or excise taxes on net
investment income or capital gains to the extent that these are distributed
to shareholders in accordance with applicable provisions of the Code.
OTHER TAX INFORMATION. The information above is only a summary of some of
the federal tax consequences generally affecting a Portfolio and its
shareholders, and no attempt has been made to discuss individual tax
consequences. In addition to federal tax es , investors may be subject
to state or local taxes on their investment. Investors should consult their
tax advisors to determine whether a Portfolio is suitable to their
particular tax situation.
When investors sign their account application, they will be asked to
certify that their social security or taxpayer identification number is
correct and that they are not subject to 31% backup withholding for failing
to report income to the IRS. If investors violate IRS regulations, the IRS
can require a Portfolio to withhold 31% of taxable distributions and
redemptions.
Issuers of tax-exempt bonds should note that, although the U.S. Treasury
has adopted rules which allow certain issuers of tax-exempt bonds to take
into account qualified administrative costs in determining payments and
receipts on non-purpose investments, there is no assurance that expenses of
a Portfolio will meet this standard. Such issuers should consult their own
tax counsel before investing.
PORTFOLIO TRANSACTIONS
Money market obligations generally are traded in the over-the-counter
market through broker-dealers. A broker-dealer is a securities firm or bank
which makes a market for securities by offering to buy at one price and
sell at a slightly higher price. The difference between the prices is known
as a spread. Since FMR trades, directly or through affiliated sub-advisers,
a large number of securities, including those of Fidelity's other funds,
broker-dealers are willing to work with the Portfolios on a more
favorable spread than would be possible for most individual investors.
All orders for the purchase or sale of portfolio securities are placed on
behalf of each Portfolio by FMR (either directly or through affiliated
sub-advisers) pursuant to authority contained in each Portfolio's
Management Contract. FMR is also responsible for the placement of
transaction orders for other investment companies and accounts for which it
or its affiliates act as investment adviser. Securities purchased and sold
by the Portfolios will be traded on a net basis (i.e., without commission).
In selecting broker-dealers, subject to applicable limitations of the
federal securities laws, FMR will consider various relevant factors,
including, but not limited to, the size and type of the transaction; the
nature and character of the markets for the security to be purchased or
sold; the execution efficiency, settlement capability, and financial
condition of the broker-dealer firm; the broker-dealer's execution services
rendered on a continuing basis; and the reasonableness of any commissions.
The Portfolios may execute portfolio transactions with broker-dealers who
provide research and execution services to the Portfolios and other
accounts over which FMR or its affiliates exercise investment discretion.
Such services may include advice concerning the value of securities; the
advisability of investing in, purchasing or selling securities; the
availability of securities or the purchasers or sellers of securities;
furnishing analyses and reports concerning issuers, industries, securities,
economic factors and trends, portfolio strategy, and performance of
accounts; and effecting securities transactions and performing functions
incidental thereto (such as clearance and settlement). FMR maintains a
listing of broker-dealers who provide such services on a regular basis.
However, as many transactions on behalf of the Portfolios are placed with
dealers (including broker-dealers on the list) without regard to the
furnishing of such services, it is not possible to estimate the proportion
of such transactions directed to such broker-dealers solely because such
services were provided. The selection of such broker-dealers is generally
made by FMR (to the extent possible consistent with execution
considerations) based upon the quality of research and execution services
provided.
The receipt of research from broker-dealers that execute transactions on
behalf of the Portfolios may be useful to FMR in rendering investment
management services to the Portfolios and/or its other clients, and
conversely, such research provided by broker-dealers who have executed
transaction orders on behalf of other FMR clients may be useful to FMR in
carrying out its obligations to the Portfolios. The receipt of such
research has not reduced FMR's normal independent research activities;
however, it enables FMR to avoid the additional expenses that could be
incurred if FMR tried to develop comparable information through its own
efforts.
Subject to applicable limitations of the federal securities laws,
broker-dealers may receive commissions for agency transactions that are in
excess of the amount of commissions charged by other broker-dealers in
recognition of their research and execution services. In order to cause the
Portfolios to pay such higher commissions, FMR must determine in good faith
that such commissions are reasonable in relation to the value of the
brokerage and research services provided by such executing broker-dealers,
viewed in terms of a particular transaction or FMR's overall
responsibilities to the Portfolios and its other clients. In reaching this
determination, FMR will not attempt to place a specific dollar value on the
brokerage and research services provided, or to determine what portion of
the compensation should be related to those services.
FMR is authorized to use research services provided by and to place
portfolio transactions with brokerage firms that have provided assistance
in the distribution of shares of the Portfolios or shares of other Fidelity
funds to the extent permitted by law. FMR may use research services
provided by and place agency transactions with Fidelity Brokerage Services,
Inc. (FBSI), a member of the New York Stock Exchange and a subsidiary of
FMR Corp., if the commissions are fair and reasonable and comparable to
commissions charged by non-affiliated, qualified brokerage firms for
similar services. Section 11(a) of the Securities Exchange Act of 1934
prohibits members of national securities exchanges from executing exchange
transactions for accounts which they or their affiliates manage, unless
certain requirements are satisfied. Pursuant to such requirements, the
Board of Trustees has authorized FBSI to execute portfolio transactions on
national securities exchanges in accordance with approved procedures and
applicable SEC rules.
The Board of Trustees periodically review s FMR's performance
of its responsibilities in connection with the placement of portfolio
transactions on behalf of the Portfolios and review s the commissions
paid by the Portfolios over representative periods of time to determine if
they are reasonable in relation to the benefits to the Portfolios.
From time to time the Board of Trustees will review whether the
recapture for the benefit of the Portfolios of some portion of the
brokerage commissions or similar fees paid by the Portfolios on portfolio
transactions is legally permissible and advisable. The Portfolios seek to
recapture soliciting broker-dealer fees on the tender of portfolio
securities, but at present no other recapture arrangements are in effect.
The Trustees intend to continue to review whether recapture opportunities
are available and are legally permissible and, if so, to determine, in the
exercise of their business judgment, whether it would be advisable for the
Portfolios to seek such recapture.
Although the Trustees and officers of the Fund are substantially the
same as those of other funds managed by FMR, investment decisions for the
Portfolios are made independently from those of other funds managed by FMR
or accounts managed by FMR affiliates. It sometimes happens that the same
security is held in the portfolio of more than one of these funds or
accounts. Simultaneous transactions are inevitable when several funds are
managed by the same investment adviser, particularly when the same security
is suitable for the investment objective of more than one fund.
When two or more funds are simultaneously engaged in the purchase or sale
of the same security, the prices and amounts are allocated in accordance
with a formula considered by the officers of the funds involved to be
equitable to each fund. In some cases this system could have a detrimental
effect on the price or value of the security as far as the Portfolios are
concerned. In other cases, however, the ability of the Portfolios to
participate in volume transactions will produce better executions and
prices for the Portfolios. It is the current opinion of the Trustees that
the desirability of retaining FMR as investment adviser to the Portfolios
outweighs any disadvantages that may be said to exist from exposure to
simultaneous transactions.
PERFORMANCE
From time to time each Portfolio advertises its YIELD and EFFECTIVE YIELD
in advertisements or in reports or other communications with shareholders.
(Yield and total return figures will differ among each class of a
Portfolio's shares.) Both yield figures are based on historical earnings
and are not intended to indicate future performance. The CURRENT YIELD
refers to the income generated by an investment in a Portfolio over a
seven-day period (which will be stated in the advertisement). The net
change in value of a hypothetical account containing one share reflects the
value of additional shares purchased with dividends from the one original
share and dividends declared on both the original share and any additional
shares. 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 each Portfolio is assumed
to be reinvested. The effective yield will be slightly higher than the
current yield because of the compounding effect of this assumed
reinvestment. In addition to the current yield, a Portfolio may quote
yields in advertising based on any historical seven - day period.
The yield and effective yield figures are illustrated below for the
seven-day period ended March 31, 1994.
Class A Class B
Effective Effective
Yield Yield Yield Yield
Treasury Portfolio * 3.32 % 3.38 % - -
Treasury Portfolio II 3.32 % 3.38 % 3.00% 3.04%
Government Portfolio * 3.39 % 3.45 % - -
Domestic Portfolio* 3.39 % 3.45 % - -
Money Market Portfolio 3.48 % 3.54 % 3.16% 3.21%
*Class B not operational during this period.
Yield information may be useful in reviewing each Portfolio's performance
and for providing a basis for comparison with other investment
alternatives. Each Portfolio's yield will fluctuate, unlike investments
which pay a fixed yield for a stated period of time. Investors should give
consideration to the quality and maturity of portfolio securities of the
respective investment companies when comparing investments.
Each Portfolio's TOTAL RETURN is based on the overall dollar or percentage
change in value of a hypothetical investment in a Portfolio, assuming
dividends are reinvested. A CUMULATIVE TOTAL RETURN reflects a Portfolio's
performance over a stated period of time. An AVERAGE ANNUAL TOTAL RETURN
reflects the hypothetical annually compounded return that would have
produced the same cumulative total return if performance had been constant
over the entire period. Because average annual returns tend to smooth out
variations in a Portfolio's performance, investors should recognize that
they are not the same as actual year-by-year results.
The Portfolios' performance, or the performance of securities in which they
may invest, may be compared to:
(bullet) IBC/Donoghue's MONEY FUND AVERAGES (trademark) , which are
average yields of various types of money market funds that include the
effect of compounding distributions, assume reinvestment of distributions,
are reported in IBC/Donoghue's MONEY FUND REPORT (registered
trademark) , and are published by IBC USA (Publications), Inc. of
Ashland, Massachusetts;
(bullet) Other mutual funds in general, or to the performance of specific
types of mutual funds. These comparisons may be expressed as mutual fund
rankings prepared by Lipper Analytical Services, Inc. (Lipper), an
independent service located in Summit, New Jersey that monitors the
performance of mutual funds. Lipper generally ranks funds on the basis of
total return, assuming reinvestment of distributions, but does not take
sales charges or redemption fees into consideration, and is prepared
without regard to tax consequences. Lipper may also rank the funds based on
yield. In addition to the mutual fund rankings, a Portfolio's performance
may be compared to mutual fund performance indices prepared by Lipper;
(bullet) Yields on other money market securities or averages of other money
market securities as reported by the Federal Reserve Bulletin; by TeleRate,
a financial information network; or by Salomon Brothers Inc., a
broker-dealer firm; and
(bullet) Fixed-income investments such as Certificates of Deposit (CDs).
The principal value and interest rate of CDs and certain other money market
securities are fixed generally at the time of purchase, whereas each
Portfolio's yield will fluctuate. Unlike some CDs and certain other money
market securities, money market mutual funds are not insured by the FDIC.
Investors should give consideration to the quality and maturity of the
portfolio securities of the respective investment companies when comparing
investment alternatives. The Portfolios also may reference the growth and
variety of money market mutual funds and the Adviser's innovation and
participation in the industry.
Each Portfolio may discuss its fund number, Quotron (trademark)
number, CUSIP number, and current portfolio manager .
From time to time, in reports and promotional literature, each Portfolio's
performance also may be compared to other mutual funds tracked by financial
or business publications and periodicals. For example, each Portfolio may
quote Morningstar, Inc. in its advertising materials. Morningstar, Inc. is
a mutual fund rating service that rates mutual funds on the basis of
risk-adjusted performance. In addition, each Portfolio may quote financial
or business publications and periodicals as they relate to fund management,
investment philosophy, and investment techniques. Rankings that compare the
performance of Fidelity funds to one another in appropriate categories over
specific periods of time may also be quoted in advertising.
MANAGEMENT CONTRACTS, DISTRIBUTION PLANS AND SERVICE AGREEMENTS
MANAGEMENT CONTRACTS. Each Portfolio employs FMR to furnish investment
advisory and other services to the Portfolio. Under FMR's Management
Contract with each Portfolio, FMR acts as investment adviser and, subject
to the supervision of the Board of Trustees, directs the investments of
each Portfolio in accordance with its investment objective, policies and
limitations. FMR also provides each Portfolio with all necessary office
facilities, equipment and personnel for servicing the Portfolio's
investments, and compensates all officers of the Fund, all Trustees who are
"interested persons" of the Fund or of FMR, and all personnel of the Fund
or FMR performing services relating to research, statistical and investment
activities.
In addition, FMR or its affiliates, subject to the supervision of the Board
of Trustees, provides the management and administrative services necessary
for the operation of each Portfolio. These services include providing
facilities for maintaining each Portfolio's organization; supervising
relations with the custodians, transfer and pricing agents, accountants,
underwriters and other persons dealing with the Portfolios; preparing all
general shareholder communications and conducting shareholder relations;
maintaining the Fund's records and the registration of each Portfolio's
shares under federal and state securities laws; developing management and
shareholder services for each Portfolio and furnishing reports, evaluations
and analyses on a variety of subjects to the Trustees. As described
below, FMR has agreed to limit each Portfolio's expenses.
For these services each Portfolio pays a monthly fee to FMR at the annual
rate of .20% of the average net assets of the Portfolio as determined as of
the close of business on each day throughout the month.
For the fiscal years ended March 31, 1994, 1993, and 1992 , management fees
before reimbursement of expenses were $ 3,796,042 , $5,351,14 5
and $4,236,988 for Treasury Portfolio, $ 9,834,015 , $14,029,197 and
$8,506,023 for Treasury Portfolio II, $ 9,660,519 , $12,610,880 and
$8,576,656 for Government Portfolio, $ 1,525,574 , $1,536,740 and
$1,095,503 for Domestic Portfolio, and $ 10,551,990 , $10,066,276 and
$9,604,202 for Money Market Portfolio, respectively.
In addition to the management fee payable to FMR and the fees payable to
Service and FIIOC, and subject to the reimbursement provisions described
below, each Portfolio pays all its expenses, without limitation, that are
not assumed by those parties. Each Portfolio pays for the typesetting,
printing and mailing of its proxy material to shareholders, and for legal
expenses and the fees of the custodian, auditor and non-interested
Trustees. Other charges paid by each Portfolio include: interest, taxes,
brokerage commissions, the Portfolio's proportionate share of insurance
premiums and Investment Company Institute dues, and the costs of
registering shares under federal and state securities laws. Each Portfolio
also is liable for such nonrecurring expenses as may arise, including costs
of litigation to which the Portfolio is a party and any obligation it may
have to indemnify officers and Trustees with respect to such litigation.
Although each Portfolio's current Management Contract provides that the
Portfolio will pay for typesetting, printing and mailing of Prospectuses,
Statements of Additional Information and reports to existing shareholders,
the Portfolios entered into a revised transfer agent agreement with FIIOC
effective June 1, 1989, pursuant to which FIIOC bears the cost of providing
these services.
FMR has voluntarily agreed to reimburse Class A of each of the
Portfolios if and to the extent that the aggregate operating
expenses of Class A (excluding interest, taxes, brokerage
commissions, and extraordinary expenses) exceed an annual rate of
.18% of the average net assets of Class A for any fiscal year or for
a portion of such year if FMR's agreement is terminated or revised. FMR
retains the ability to be repaid b y Class A of the Portfolios for
these expense reimbursements in the amount that expenses fall below the
limit prior to the end of the fiscal year. FMR will continue this
reimbursement arrangement subject to revision upon 90 days' notice to
shareholders. Such reimbursements have the effect of artificially
decreasing a Portfolio's Class A expenses, thereby increasing
the yield of such Portfolio's Class A shares .
For the fiscal years ended March 31, 1994, 1993, and 1992, aggregate
Class A operating expenses reimbursed by FMR were $ 903,610 ,
$1,246,151, and $1,470,637 for Treasury Portfolio, $ 2,956,232 ,
$3,246,298 and $3,143,538 for Treasury Portfolio II, $ 2,665,587 ,
$3,508,338 and $2,804,357 for Government Portfolio, $ 638,552 ,
$645,507 and $579,020 for Domestic Portfolio, and $ 2,437,428 ,
$2,697,402 and $2,735,714 for Money Market Portfolio, respectively.
SUB-ADVISORY AGREEMENTS. With respect to each Portfolio, FMR has entered
into a sub-advisory agreement with FMR Texas, a Texas corporation with
principal offices at 400 East Las Colinas Boulevard in Irving, Texas.
Pursuant to the agreement, FMR Texas has primary responsibility for
providing portfolio investment management services to each Portfolio, while
FMR retains responsibility for providing other portfolio management
services.
Under each sub-advisory agreement, FMR pays FMR Texas fees equal to 50% of
the management fees payable to FMR under its current Management Contract
with each Portfolio. The fees paid to FMR Texas are not reduced by any
voluntary or mandatory expense reimbursements that may be in effect from
time to time.
For the fiscal years ended March 31, 1994, 1993, and 1992, fees paid to FMR
Texas by FMR were $ 1,898,021 , $2,675,57 4 and $2,118,494 for
the Treasury Portfolio, $4,917,008 , $7,014,599 and $4,253,012 for
Treasury Portfolio II, $ 4,830,260 , $6,305,440 and $4,288,328 for
Government Portfolio, $ 762,787 , $768,370 and $547,752 for Domestic
Portfolio and $ 5,275,995 , $5,033,138 and $4,802,101 for Money Market
Portfolio, respectively.
CONTRACTS WITH COMPANIES AFFILIATED WITH FMR. FIIOC , 82 Devonshire
Street, Boston, Massachusetts 02109, an affiliate of FMR, is transfer,
dividend-paying and shareholder servicing agent for each Portfolio and
maintains shareholder records.
For institutional client master accounts effective June 1, 1990, FIIOC
receives a per account fee and a monetary transaction fee of $65 and $14,
respectively, or $60 and $12, respectively, depending on the nature of
services provided. Effective January 1, 1993, FIIOC is paid a per account
fee of $95 and a monetary transaction fee of $20 or $17.50 depending on the
nature of the services provided. Fees for institutional retirement plan
accounts, if any, would be based on the NAV of all such accounts in a
Portfolio. In addition, FIIOC pays out-of-pocket expenses associated with
providing transfer agent services and bears the expense of typesetting,
printing and mailing Prospectuses, Statements of Additional Information,
reports, notices and statements to shareholders.
For the fiscal years ended March 31, 1994, 1993, and 1992, transfer agent
fees and expenses were $ 150,635 , $198,961 and $259,235 for Treasury
Portfolio, $ 1,101,750 , $786,114 and $723,978 for Treasury Portfolio
II, $ 878,411 , $889,140 and $726,802 for Government Portfolio,
$ 262,203 , $162,165 and $118,032 for Domestic Portfolio and
$ 515,041 , $591,793 and $680,128 for Money Market Portfolio,
respectively.
The Portfolios' contracts with Service, an affiliate of FMR, provides that
Service will perform the calculations necessary to determine each
Portfolio ' s net asset value per share and dividends and maintain
general accounting records. Prior to July 1, 1991, the annual fee for these
pricing and bookkeeping services was based on two schedules, one pertaining
to each Portfolio's average net assets and one pertaining to the type and
number of transactions a Portfolio made. The fee rates in effect as of July
1, 1991 are based on each Portfolio's average net assets, specifically
.0175% for the first $500 million of average net assets and .0075% for
average net assets in excess of $500 million. The fee is limited to a
minimum of $20,000 and a maximum of $750,000 per year for each Portfolio.
For the fiscal years ended March 31, 1994, 1993, and 1992, fees paid to
Service for pricing and bookkeeping services (including related
out-of-pocket expenses) were $ 192,236 , $251,607 and $210,011 for
Treasury Portfolio, $ 419,147 , $57 6 ,072 and $354,383 for
Treasury Portfolio II, $ 412,411 , $523,696 and $346,477 for
Government Portfolio, $ 107,464 , $108,548 and $95,756 for Domestic
Portfolio and $ 445,362 , $429,428 and $376,076 for Money Market
Portfolio, respectively.
Service also receives fees for administering the Portfolios' securities
lending programs where applicable. Securities lending fees are based on the
number and duration of individual securities loans.
Each Portfolio has a Distribution Agreement with Fidelity Distributors
Corporation (Distributors), an affiliate of FMR. Distributors, a
Massachusetts corporation organized July 18, 1960, is a broker-dealer
registered under the Securities Exchange Act of 1934 and is a member of the
National Association of Securities Dealers, Inc (NASD) . The
Distribution Agreement calls for Distributors to use all reasonable
efforts, consistent with its other business, to secure purchasers for
shares of each Portfolio. Promotional and administrative expenses in
connection with the offer and sale of shares are paid by FMR. Distributors
also acts as general distributor for other publicly offered Fidelity funds.
DISTRIBUTION AND SERVICE PLANS. The Board of Trustees has adopted, on
behalf of Class A of each Portfolio , a Distribution and Service
Plan (each Plan) pursuant to Rule 12b-1 of the 1940 Act (the Rule). The
Rule provides in substance that a mutual fund may not engage directly or
indirectly in financing any activity that is intended primarily to
result in the sale of shares of the fund except pursuant to a plan adopted
by the fund under the Rule. The Fund's Board of Trustees adopted the Plans
to assure that Class A of each Portfolio and FMR may incur certain
expenses that might be considered to constitute indirect payment by
Class A of the Portfolio of distribution expenses.
Each Plan specifically recognizes that FMR, either directly or through
Distributors, may use its management fee revenue, past profits or other
resources, without limitation, to pay promotional and administrative
expenses in connection with the offer and sale of Class A shares of
the Portfolios. In addition, each Plan provides that FMR may use its
resources, including its management fee revenues, to make payments to banks
and other financial intermediaries that provide Class A sales and/or
shareholder support services. The Trustees have not authorized any such
payments.
As required by the Rule, the Trustees carefully considered all pertinent
factors relating to the implementation of each Plan prior to its approval,
and have determined that there is a reasonable likelihood that each Plan
will benefit the Class A shares of the relevant Portfolios and their
shareholders. In particular, the Trustees noted that each Plan does not
authorize payments by Class A shares of a Portfolio other than those
made to FMR under its Management Contract with the Portfolio. To the extent
that the Plans give FMR and Distributors greater flexibility in connection
with the distribution of Class A shares of the Portfolios,
additional sales of each Portfolio's Class A shares may
result. Additionally, certain shareholder support services may be provided
more effectively under the Plans by local entities with whom shareholders
have other relationships.
The Glass-Steagall Act generally prohibits federally and state chartered or
supervised banks from engaging in the business of underwriting, selling or
distributing securities. Although the scope of this prohibition under the
Glass-Steagall Act has not been clearly defined, in Distributors' opinion
it should not prohibit banks from being paid for shareholder servicing and
recordkeeping functions. Distributors intends to engage banks only for the
purpose of performing such functions. However, changes in federal or state
statutes and regulations pertaining to the permissible activities of banks
and their affiliates or subsidiaries, as well as further judicial or
administrative decisions or interpretations, could prevent a bank from
continuing to perform all or a part of the contemplated services. If a bank
were prohibited from so acting, the Trustees would consider what actions,
if any, should be taken to continue to provide efficient and effective
shareholder services. In such event, changes in the operation of the
Portfolios might occur, including possible termination of any automatic
investment or redemption or other services then being provided by the bank.
It is not expected that shareholders would suffer any adverse financial
consequences as a result of any of these occurrences. In addition, state
securities laws on this issue may differ from the interpretations of
federal law expressed herein, and banks and financial institutions may be
required to register as dealers pursuant to state law. The Portfolios may
execute portfolio transactions with and purchase securities issued by
depository institutions that receive payments under the Plans. No
preference for the instruments of depository institutions will be
shown in the selection of investments.
DESCRIPTION OF THE FUND
FUND ORGANIZATION. Treasury Portfolio , Treasury Portfolio II ,
Government Portfolio , Domestic Portfolio and Money Market
Portfolio are series of Fidelity Institutional Cash Portfolios,
which is an open-end management investment company organized as a Delaware
b usiness trust on May 30, 1993. The Portfolios acquired all of the
assets of the series of a Massachusetts business t rust,
Fidelity Institutional Cash Portfolios , on May 30, 1993. Currently
there are five Portfolios in the Fund . Each Portfolio currently
offers two c lasses of shares, Class A and Class B. The Trust
Instrument permits the Trustees to create additional series .
Class B shares of each Portfolio are offered to institutional and corporate
investors that invest through a bank or other financial intermediary. Each
Portfolio's Class B has a Distribution and Service Plan pursuant to Rule
12b-1 ( the Class B Plan s ). Under each Class B Plan,
Class B is authorized to pay Distributors a monthly distribution fee
at an annual rate of up to .32% of its average net assets ( except
Government Portfolio which is .25%). All or a portion of the
distribution fee is paid by Distributors to banks or other financial
intermediaries as compensation for providing Class B sales and/or
shareholder support services. Class B shares of one Portfolio may be
exchanged (subject to the minimum initial investment requirement) at
no charge for Class B shares of any other Portfolio of the Fund .
In the event that FMR ceases to be the investment adviser to the Fund
or a Portfolio, the right of the Fund or Portfolio to use the
identifying name "Fidelity" may be withdrawn. There is a remote possibility
that one Portfolio might become liable for any misstatement in its
Prospectus and Statement of Additional Information about another Portfolio.
The assets of the Fund received for the issue or sale of shares of each of
its Portfolios and all income, earnings, profits, and proceeds thereof,
subject only to the rights of creditors, are especially allocated to such
Portfolio, and constitute the underlying assets of such Portfolio. The
underlying assets of each Portfolio are segregated on the books of account,
and are to be charged with the liabilities with respect to such Portfolio
and with a share of the general expenses of the Fund. Expenses with respect
to the Fund are to be allocated in proportion to the asset value of the
respective Portfolios or classes except where allocations of direct
expense can otherwise be fairly made. The officers of the Fund, subject to
the general supervision of the Board of Trustees, have the power to
determine which expenses are allocable to a given Portfolio or
class , or which are general or allocable to all of the Portfolios. In
the event of the dissolution or liquidation of the Fund, shareholders of
each Portfolio are entitled to receive as a class the underlying assets of
such Portfolio available for distribution.
SHAREHOLDER AND TRUSTEE LIABILITY. The Fund is a business trust organized
under Delaware law. Delaware law provides that shareholders shall be
entitled to the same limitations of personal liability extended to
stockholders of private corporations for profit. The courts of some states,
however, may decline to apply Delaware law on this point. The Trust
Instrument contains an express disclaimer of shareholder liability for the
debts, liabilities, obligations, and expenses of the Fund and requires that
a disclaimer be given in each contract entered into or executed by the Fund
or the Trustees. The Trust Instrument provides for indemnification out of
each Portfolio's property of any shareholder or former shareholder held
personally liable for the obligations of the Portfolio. The Trust
Instrument also provides that each Portfolio shall, upon request,
assume the defense of any claim made against any shareholder for any act or
obligation of the Portfolio and satisfy any judgment thereon. Thus, the
risk of a shareholder incurring financial loss on account of shareholder
liability is limited to circumstances in which Delaware law does not apply,
no contractual limitation of liability was in effect, and the
P ortfolio is unable to meet its obligations. FMR believes that, in view
of the above, the risk of personal liability to shareholders is extremely
remote.
The Trust Instrument further provides that the Trustees, if they have
exercised reasonable care, shall not be personally liable to any person
other than the Fund or its shareholders; moreover, the Trustees shall not
be liable for any conduct whatsoever, provided that Trustees are not
protected against any liability to which they would otherwise be subject by
reason of willful misfeasance, bad faith, gross negligence, or reckless
disregard of the duties involved in the conduct of their office.
VOTING RIGHTS. Each class of each Portfolio's capital consists of shares of
beneficial interest. The shares have no preemptive or conversion rights;
the voting and dividend rights, the right of redemption, and the privilege
of exchange are described in this Prospectus and Statement of Additional
Information. Shares are fully paid and nonassessable, except as set forth
under the heading "Shareholder and Trustee Liability" above. Shareholders
representing 10% or more of the Fund, a Portfolio or a c lass may, as
set forth in the Trust Instrument, call meetings of the Fund ,
Portfolio or class for any purpose related to the Fund, Portfolio or
class, as the case may be, including, in the case of a meeting of
the entire Fund, the purpose of voting on removal of one or more Trustees.
The Fund or a Portfolio may be terminated upon the sale of its
assets to another open-end management investment company, or upon
liquidation and distribution of its assets. Generally such terminations
must be approved by vote of the holders of a majority of the outstanding
shares of the Fund or Portfolio; however, the Trustees may, without
prior shareholder approval, change the form or organization of the Fund by
merger, consolidation, or incorporation. If not so terminated, the Fund
and the Portfolios will continue indefinitely.
Under the Trust Instrument, the Trustees may, without shareholder vote,
cause the Fund to merge or consolidate into one or more trusts,
partnerships, or corporations, or cause the Fund to be incorporated under
Delaware law, so long as the surviving entity is an open-end management
investment company that will succeed to or assume the Fund 's
registration statement.
As of March 3 1 , 1994, the following owned of record or
beneficially 5% or more of the outstanding Class A shares of:
Treasury Portfolio
Michigan National Bank, Farmington Hills, MI 22.11%
Wachovia Bank & Trust, Winston-Salem, NC 7.18%
First Bank Systems, Minneapolis, MN 7.03%
Bank of America, San Francisco, CA 5.99%
Treasury Portfolio II
First Union Bank of Charlotte, Charlotte, NC 13.97%
Bank of America, San Francisco, CA 13.22%
First Tennesee Bank, Memphis, TN 9.20%
Texas Commerce Bank, N.A., Houston, TX 5.15%
Government Portfolio
First Tennessee Bank, Memphis, TN 8.71%
First Trust of St. Paul, St. Paul, MN 8.31%
Mass General Hospital, Boston, MA 7.70%
Mass Water Resource Authority, Boston, MA 7.54%
Texas Commerce Bank, N.A., Houston, TX 5.45%
Domestic Portfolio
First Union Bank of Charlotte, Charlotte, NC 34.74%
Texas Commerce Bank, N.A., Houston, TX 10.61%
Union Trust Company, New Haven, CT 10.25%
Money Market Portfolio
Shawmut Bank N.A., Boston, MA 11.80%
First Bank System, Minneapolis, MN 6.45%
A shareholder owning more than 25% of the Portfolio's shares may be
considered a "controlling person" of the Portfolio. Accordingly, its vote
could have a more significant effect on matters presented at a
shareholders' meeting than the other shareholders of the Portfolio.
CUSTODIAN. Morgan Guaranty Trust Company of New York, 60 Wall Street, New
York, NY 10260 is custodian of the assets of all Portfolios
except Treasury Portfolio II. As of September 15, 1993, the custodian for
Treasury Portfolio II is the Bank of New York, 48 Wall Street, New York,
NY . The custodian is responsible for the safekeeping of the Portfolios'
assets and the appointment of subcustodian banks and clearing agencies. The
custodian takes no part in determining the investment policies of the
Portfolio or in deciding which securities are purchased or sold by the
Portfolio . The Portfolios, however, may invest in obligations of the
custodian and may purchase securities from or sell securities to the
custodian.
FMR, its officers and directors , its affiliated companies and the
Fund's Trustees may, from time to time, have transactions with various
banks, including banks serving as custodians for certain of the other
funds advised by FMR. Transactions that have occurred to date include
mortgages and personal and general business loans. In the judgment of FMR,
the terms and conditions of those transactions were not influenced by
existing or potential custodial or other Fund relationships.
AUDITOR. Price Waterhouse , 1700 Pacific Avenue, Dallas, TX 75201
serves as the Fund's independent accountants. The auditor examines
financial statements for the Fund and provides other audit, tax, and
related services.
FMR. FMR, 82 Devonshire Street, Boston, Massachusetts 02109, is a wholly
owned subsidiary of FMR Corp., a parent company organized in 1972. At
present, the principal operating activities of FMR Corp. are those
conducted by three of its divisions as follows: Fidelity Service Co., which
is the transfer and shareholder servicing agent for certain of the funds
advised by FMR; Fidelity Investments Institutional Operations Company,
which performs shareholder servicing functions for certain institutional
customers; and Fidelity Investments Retail Services Marketing Company,
which provides marketing services to various companies within the Fidelity
organization. Through ownership of voting common stock, Edward C. Johnson
3rd (President and a Trustee of the Fund), Johnson family members, and
various trusts for the benefit of Johnson family members form a controlling
group with respect to FMR Corp.
Several affiliates of FMR also are engaged in the investment advisory
business. Fidelity Management Trust Company provides trustee, investment
advisory and administrative services to retirement plans and corporate
employee benefit accounts. Fidelity Management & Research (U.K.) Inc.
(FMR U.K.) and Fidelity Management & Research (Far East) Inc. (FMR Far
East), both wholly owned subsidiaries of FMR formed in 1986, supply
investment research, and may supply portfolio management services, to FMR
in connection with certain funds advised by FMR. Analysts employed by FMR,
FMR U.K., and FMR Far East research and visit thousands of domestic
companies each year. FMR Texas, a wholly owned subsidiary of FMR formed in
1989, supplies portfolio management and research services in connection
with certain money market funds advised by FMR.
TRUSTEES AND OFFICERS. The Trustees and executive officers of the
Fund 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. Trustees and officers elected or appointed prior to the
Fund's conversion to a Delaware business trust served the
Massachusetts business trust in identical capacities. All persons named as
Trustees serve in similar capacities for other funds advised by FMR. Unless
otherwise noted, the business address of each Trustee and officer is 82
Devonshire Street, Boston, Massachusetts 02109, which is also the address
of FMR. Those Trustees who are "interested persons" (as defined in the
1940 Act ) by virtue of their affiliation with either the Fund
or FMR, are indicated by an asterisk (*).
*EDWARD C. JOHNSON 3d, Trustee and President, is Chairman, Chief
Executive Officer and a Director of FMR Corp.; a Director and Chairman of
the Board and of the Executive Committee of FMR; Chairman and a Director of
FMR Texas Inc. (1989), Fidelity Management & Research (U.K.) Inc., and
Fidelity Management & Research (Far East) Inc.
*J. GARY BURKHEAD, Trustee and Senior Vice President, is President of
FMR; and President and a Director of FMR Texas Inc. (1989), Fidelity
Management & Research (U.K.) Inc., and Fidelity Management &
Research (Far East) Inc.
RALPH F. COX, 200 Rivercrest Drive, Fort Worth, TX, Trustee (1991), is a
consultant to Western Mining Corporation (1994). Prior to February 1994, he
was President of Greenhill Petroleum Corporation (petroleum exploration and
production, 1990). Until March 1990, Mr. Cox was President and Chief
Operating Officer of Union Pacific Resources Company (exploration and
production). He is a Director of Sanifill Corporation (non-hazardous
waste, 1993) and CH2M Hill Companies (engineering). In addition, he served
on the Board of Directors of the Norton Company (manufacturer of industrial
devices, 1983-1990) and continues to serve on the Board of Directors of the
Texas State Chamber of Commerce, and is a member of advisory boards of
Texas A&M University and the University of Texas at Austin.
PHYLLIS BURKE DAVIS, P.O. Box 264, Bridgehampton, NY, Trustee (1992).
Prior to her retirement in September 1991, Mrs. Davis was the Senior Vice
President of Corporate Affairs of Avon Products, Inc. She is currently a
Director of BellSouth Corporation (telecommunications), Eaton Corporation
(manufacturing, 1991), and the TJX Companies, Inc. (retail stores, 1990),
and previously served as a Director of Hallmark Cards, Inc. (1985-1991) and
Nabisco Brands, Inc. In addition, she serves as a Director of the New York
City Chapter of the National Multiple Sclerosis Society, and is a member of
the Advisory Council of the International Executive Service Corps. and the
President's Advisory Council of The University of Vermont School of
Business Administration.
RICHARD J. FLYNN, 77 Fiske Hill, Sturbridge, MA, Trustee, is a financial
consultant. Prior to September 1986, Mr. Flynn was Vice Chairman and a
Director of the Norton Company (manufacturer of industrial devices). He is
currently a Director of Mechanics Bank and a Trustee of College of the Holy
Cross and Old Sturbridge Village, Inc.
E. BRADLEY JONES, 3881-2 Lander Road, Chagrin Falls, OH, Trustee (1990).
Prior to his retirement in 1984, Mr. Jones was Chairman and Chief Executive
Officer of LTV Steel Company. Prior to May 1990, he was Director of
National City Corporation (a bank holding company) and National City Bank
of Cleveland. He is a Director of TRW Inc. (original equipment and
replacement products), Cleveland-Cliffs Inc (mining), NACCO Industries,
Inc. (mining and marketing), Consolidated Rail Corporation, Birmingham
Steel Corporation, Hyster-Yale Materials Handling, Inc. (1989), and RPM,
Inc. (manufacturer of chemical products, 1990). In addition, he serves as
a Trustee of First Union Real Estate Investments, Chairman of the Board of
Trustees and a member of the Executive Committee of the Cleveland Clinic
Foundation, a Trustee and a member of the Executive Committee of University
School (Cleveland), and a Trustee of Cleveland Clinic Florida.
DONALD J. KIRK, 680 Steamboat Road, Apartment #1-North, Greenwich, CT,
Trustee, is a Professor at Columbia University Graduate School of Business
and a financial consultant. Prior to 1987, he was Chairman of the
Financial Accounting Standards Board. Mr. Kirk is a Director of General Re
Corporation (reinsurance) and Valuation Research Corp. (appraisals and
valuations, 1993). In addition, he serves as Vice Chairman of the Board of
Directors of the National Arts Stabilization Fund and Vice Chairman of the
Board of Trustees of the Greenwich Hospital Association.
*PETER S. LYNCH, Trustee (1990) is Vice Chairman of FMR (1992). Prior
to his retirement on May 31, 1990, he was a Director of FMR (1989) and
Executive Vice President of FMR (a position he held until March 31, 1991);
Vice President of Fidelity Magellan Fund and FMR Growth Group Leader; and
Managing Director of FMR Corp. Mr. Lynch was also Vice President of
Fidelity Investments Corporate Services (1991-1992). He is a Director of
W.R. Grace & Co. (chemicals, 1989) and Morrison Knudsen Corporation
(engineering and construction). In addition, he serves as a Trustee of
Boston College, Massachusetts Eye & Ear Infirmary, Historic Deerfield
(1989) and Society for the Preservation of New England Antiquities, and as
an Overseer of the Museum of Fine Arts of Boston (1990).
GERALD C. McDONOUGH, 135 Aspenwood Drive, Cleveland, OH, Trustee (1989),
is Chairman of G.M. Management Group (strategic advisory services). Prior
to his retirement in July 1988, he was Chairman and Chief Executive Officer
of Leaseway Transportation Corp. (physical distribution services). Mr.
McDonough is a Director of ACME-Cleveland Corp. (metal working,
telecommunications and electronic products), Brush-Wellman Inc. (metal
refining), York International Corp. (air conditioning and refrigeration,
1989), Commercial Intertech Corp. (water treatment equipment, 1992), and
Associated Estates Realty Corporation (a real estate investment trust,
1993).
EDWARD H. MALONE, 5601 Turtle Bay Drive #2104, Naples, FL, Trustee
(1988). Prior to his retirement in 1985, Mr. Malone was Chairman, General
Electric Investment Corporation and a Vice President of General Electric
Company. He is a Director of Allegheny Power Systems, Inc. (electric
utility), General Re Corporation (reinsurance) and Mattel Inc. (toy
manufacturer). In addition, he serves as a Trustee of Corporate Property
Investors, the EPS Foundation at Trinity College, the Naples Philharmonic
Center for the Arts, and Rensellaer Polytechnic Institute, and he is a
member of the Advisory Boards of Butler Capital Corporation Funds and
Warburg, Pincus Partnership Funds.
MARVIN L. MANN, 55 Railroad Avenue, Greenwich, CT, Trustee (1993) is
Chairman of the Board, President, and Chief Executive Officer of Lexmark
International, Inc. (office machines, 1991). Prior to 1991, he held the
positions of Vice President of International Business Machines Corporation
("IBM") and President and General Manager of various IBM divisions and
subsidiaries. Mr. Mann is a Director of M.A. Hanna Company (chemicals,
1993) and Infomart (marketing services, 1991), a Trammell Crow Co. In
addition, he serves as the Campaign Vice Chairman of the Tri-State United
Way (1993) and is a member of the University of Alabama President's Cabinet
(1990).
THOMAS R. WILLIAMS, 21st Floor, 191 Peachtree Street, N.E., Atlanta, GA,
Trustee (1988), is President of The Wales Group, Inc. (management and
financial advisory services). Prior to retiring in 1987, Mr. Williams
served as Chairman of the Board of First Wachovia Corporation (bank holding
company), and Chairman and Chief Executive Officer of The First National
Bank of Atlanta and First Atlanta Corporation (bank holding company). He
is currently a Director of BellSouth Corporation (telecommunications),
ConAgra, Inc. (agricultural products), Fisher Business Systems, Inc.
(computer software), Georgia Power Company (electric utility), Gerber Alley
& Associates, Inc. (computer software), National Life Insurance Company
of Vermont, American Software, Inc. (1989), and AppleSouth, Inc.
(restaurants, 1992).
GARY L. FRENCH, Treasurer (1991). Prior to becoming Treasurer of the
Fidelity funds, Mr. French was Senior Vice President, Fund Accounting -
Fidelity Accounting & Custody Services Co. (1991); Vice President, Fund
Accounting - Fidelity Accounting & Custody Services Co. (1990); and
Senior Vice President, Chief Financial and Operations Officer - Huntington
Advisers, Inc. (1985-1990).
ARTHUR S. LORING, Secretary, is Senior Vice President and General
Counsel of FMR, Vice President - Legal of FMR Corp., and Vice President and
Clerk of FDC.
ROBERT H. MORRISON, Manager, Security Transactions, is an employee of
FMR.
LELAND BARRON Vice President (1989), is also Vice President of other funds
advised by FMR and an employee of FMR Texas Inc.
BURNELL STEHMAN Vice President (1992), is also Vice President of other
funds advised by FMR and an employee of FMR Texas Inc.
JOHN TODD Vice President (1992), is also Vice President of other funds
advised by FMR and an employee of FMR Texas Inc.
THOMAS D. MAHER, Assistant Vice President (1990), is Assistant Vice
President of Fidelity's money market funds and Vice President and Associate
General Counsel of FMR Texas Inc. (1990).
Under a retirement program which became effective on November 1, 1989, a
Trustee, upon reaching age 72, becomes eligible to participate in a defined
benefit retirement program under which he receives payments during his
lifetime from the Portfolios based on his final year's basic trustee fees
and length of service. Currently, Messrs. Robert L. Johnson, William R.
Spaulding, Bertram H. Witham, and David L. Yunich participate in the
program. The Trustees receive additional payments for serving in similar
capacities for other funds advised by FMR. The Trustees and officers of the
Fund as a group own less than 1% of each Portfolio's outstanding shares.
APPENDIX A
The following paragraphs provide a brief description of securities in
which the Portfolios may invest and transactions they may make. The
Portfolios are not limited by this discussion, however, and may purchase
other types of securities and enter into other types of transactions if
they are consistent with the Portfolios' respective investment objectives
and policies.
AFFILIATED BANK TRANSACTIONS. A Portfolio may engage in
transactions with financial institutions that are, or may be considered to
be, "affiliated persons" of the Portfolio under the 1940 Act. These
transactions may include repurchase agreements with custodian banks;
short-term obligations of, and repurchase agreements with, the 50 largest
U.S. banks (measured by deposits); municipal securities; U.S. government
securities with affiliated financial institutions that are primary dealers
in these securities; short-term currency transactions; and short-term
borrowings. In accordance with exemptive orders issued by the SEC, the
Board of Trustees has established and periodically reviews procedures
applicable to transactions involving affiliated financial institutions.
ASSET-BACKED SECURITIES may include pools of mortgages, loans,
receivables or other assets. Payment of principal and interest may be
largely dependent upon the cash flows generated by the assets backing the
securities, and, in certain cases, supported by letters of credit, surety
bonds, or other credit enhancements. The value of asset-backed securities
may also be affected by the creditworthiness of the servicing agent for the
pool, the originator of the loans or receivables, or the financial
institution(s) providing the credit support.
BANKERS' ACCEPTANCES. Negotiable obligations of a bank to pay a
draft which has been drawn on it by a customer. These obligations are
backed by large banks and usually are backed by goods in international
trade.
CERTIFICATES OF DEPOSIT. Negotiable certificates representing a
commercial bank's obligations to repay funds deposited with it, earning
specified rates of interest over a given period of time.
COMMERCIAL PAPER. Short-term obligations issued by banks,
broker-dealers, corporations and other entities for purposes such as
financing their current operations.
CORPORATE OBLIGATIONS. Bonds and notes issued by corporations and
other business organizations in order to finance their long-term credit
needs.
DELAYED DELIVERY TRANSACTIONS. Each Portfolio may buy and sell
securities on a delayed delivery or when-issued basis. These transactions
involve a commitment by a Portfolio to purchase or sell specific securities
at a predetermined price and/or yield with payment and delivery taking
place after the customary settlement period for that type of security (and
more than seven days in the future). Typically, no interest accrues to the
purchaser until the security is delivered.
When purchasing securities on a delayed delivery basis, each Portfolio
assumes the rights and risks of ownership, including the risk of price and
yield fluctuations. Because a Portfolio is not required to pay for
securities until the delivery date, these risks are in addition to the
risks associated with the Portfolio's other investments. If a Portfolio
remains substantially fully invested at a time when delayed delivery
purchases are outstanding, the delayed delivery purchases may result in a
form of leverage. When delayed delivery purchases are outstanding, the
Portfolio will set aside appropriate liquid assets in a segregated
custodial account to cover its purchase obligations. When a Portfolio has
sold a security on a delayed delivery basis, the Portfolio does not
participate in further gains or losses with respect to the security. If the
other party to a delayed delivery transaction fails to deliver or pay for
the securities, the Portfolio could miss a favorable price or yield
opportunity, or could suffer a loss.
Each Portfolio may renegotiate delayed delivery transactions after they
are entered into, and may sell underlying securities before they are
delivered, which may result in capital gains or losses.
FINANCIAL SERVICES INDUSTRY. Because Domestic Portfolio and Money
Market Portfolio concentrate more than 25% of their respective total assets
in the financial services industry, their performance may be affected by
conditions affecting banks and other financial services companies.
Companies in the financial services industry are subject to various risks
related to that industry, such as governmental regulation, changes in
interest rates, and exposure on loans, including loans to foreign
borrowers. Investments in the financial services industry may include
obligations of U.S. branches of both foreign and domestic banks, savings
and loan associations, consumer and industrial finance companies,
securities brokerage companies, leasing companies, and a variety of firms
in the insurance field. These obligations include time deposits,
certificates of deposit, bankers' acceptances, and commercial paper.
FOREIGN SECURITIES. Eurodollar and Yankee dollar investments of
Money Market Portfolio risks include future unfavorable political and
economic developments, possible withholding taxes, seizure of foreign
deposits, currency controls, 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 than is available with respect to domestic banks.
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
Adviser carefully considers these factors when making investments, the
Money Market Portfolio does not limit the amount of its assets which can be
invested in any one type of instrument or in any foreign country.
ILLIQUID INVESTMENTS. Illiquid Investments are investments that
cannot be sold or disposed of in the ordinary course of business at
approximately the prices at which they are valued. Under the supervision of
the Board of Trustees, FMR determines the liquidity of a Portfolio's
investments and, through reports from FMR, the Board monitors investments
in illiquid instruments. In determining the liquidity of each Portfolio's
investments, FMR may consider various factors including (1) the frequency
of trades and quotations,(2) the number of dealers and prospective
purchasers in the marketplace, (3) dealer undertakings to make a market,
(4) the nature of the security (including any demand or tender features)
and (5) the nature of the marketplace for trades (including the ability to
assign or offset the Portfolio's rights and obligations relating to the
investment). Investments currently considered by the Portfolios to be
illiquid include repurchase agreements not entitling the holder to payment
of principal and interest within seven days. Also, for Domestic Money
Market Portfolio and Money Market Portfolio FMR may determine some
restricted securities and time deposits to be illiquid. In the absence of
market quotations illiquid investments are priced at fair value as
determined in good faith by a committee appointed by the Board of Trustees.
If through a change in values, net assets or other circumstances, a
Portfolio were in a position where more than 10% of its net assets were
invested in illiquid securities, it would seek to take appropriate steps to
protect liquidity.
INTERFUND BORROWING PROGRAM. The Portfolios have received
permission from the SEC to lend money to and borrow money from other funds
advised by FMR or its affiliates. Interfund loans and borrowings normally
will extend overnight, but can have a maximum duration of seven days.
Treasury Portfolio, Treasury Portfolio II and Government Portfolio will
participate in this interfund lending program only as borrowers. Each
Portfolio will borrow through the program only when costs are equal to or
lower than the cost of bank loans. Domestic Money Market and Money Market
Portfolio will lend through the program only when the returns are higher
than those available at the same time from other short-term instruments
(such as repurchase agreements). Each Portfolio that may lend will not lend
more than 10% of its net assets to other funds and no Portfolio will borrow
through the program if, after doing so, its total outstanding borrowings
would exceed 15% of total assets. Loans may be called on one day's notice
and a Portfolio may have to borrow from a bank at a higher interest rate if
an interfund loan is called or not renewed. Any delay in repayment to a
lending fund could result in a lost investment opportunity or additional
borrowing costs.
MONEY MARKET refers to the marketplace where short-term, high
quality debt securities are traded, including U.S. government obligations,
commercial paper, certificates of deposit, bankers' acceptances, time
deposits and short-term corporate obligations. Money market instruments may
carry fixed rates of return or have variable or floating interest
rates.
MUNICIPAL OBLIGATIONS are issued to raise money for various
public purposes, including general purpose financing for state and local
governments as well as financing for specific projects or public
facilities. Municipal obligations may be backed by the full taxing power of
a municipality or by the revenues from a specific project or the credit of
a private organization.
REPURCHASE AGREEMENTS are transactions by which a Portfolio
purchases a security and simultaneously commits to resell that security to
the seller at an agreed upon price on an agreed upon date within a number
of days from the date of purchase. The resale price reflects the purchase
price plus an agreed upon incremental amount which is unrelated to the
coupon rate or maturity of the purchased security. A repurchase agreement
involves the obligation of the seller to pay the agreed upon price, which
obligation is in effect secured by the value (at least equal to the amount
of the agreed upon resale price and marked to market daily) of the
underlying security. Each Portfolio may engage in a repurchase agreement
with respect to any type of security in which that Portfolio is authorized
to invest, regardless of length of time to maturity. While it does not
presently appear possible to eliminate all risks from these transactions
(particularly the possibility of a decline in the market value of the
underlying securities, as well as delays and costs to the Portfolios in
connection with bankruptcy proceedings), it is the policy of each Portfolio
to limit repurchase agreements to parties whose creditworthiness has been
reviewed and found satisfactory by FMR.
RESTRICTED SECURITIES. Restricted securities are not registered
for sale to the general public. Restricted securities generally can be sold
in privately negotiated transactions, pursuant to an exemption from
registration under the Securities Act of 1933, or in a registered public
offering. Where registration is required, a Portfolio may be obligated to
pay all or part of the registration expense and a considerable period may
elapse between the time it decides to seek registration and the time the
fund may be permitted to sell a security under an effective registration
statement. If, during such a period, adverse market conditions were to
develop, the Portfolio might obtain a less favorable price than prevailed
when it decided to seek registration of the security.
REVERSE REPURCHASE AGREEMENTS. Each Portfolio, other than
Treasury Portfolio II, may engage in reverse repurchase agreements. Reverse
repurchase agreements are transactions whereby a Portfolio temporarily
transfers possession of a portfolio instrument to another party, such as a
bank or broker-dealer, in return for cash. At the same time, the Portfolio
agrees to repurchase the instrument at an agreed-upon price and time. A
Portfolio expects that it will engage in reverse repurchase agreements for
temporary purposes such as to fund redemptions or when it is able to invest
cash so acquired at a rate higher than the cost of the agreement, which
would increase the income earned by a Portfolio. While a reverse repurchase
agreement is outstanding, the Portfolio will maintain appropriate liquid
assets in a segregated custodial account to cover its obligation under the
agreement. Reverse repurchase agreements may increase the risk of
fluctuation in the market value of a Portfolio's assets or in its yield.
Such transactions may increase fluctuations in the market value of a
Portfolio's assets and may be viewed as a form of leverage. A Portfolio
will enter into reverse repurchase agreements only with parties whose
creditworthiness has been found satisfactory by FMR.
SHORT SALES "AGAINST THE BOX." A Portfolio may sell securities
short when it owns or has the right to obtain securities equivalent in kind
or amount to the securities sold short. Short sales could be used to
protect the net asset value per share of the Portfolio in anticipation of
increased interest rates, without sacrificing the current yield of the
securities sold short. If a Portfolio enters into a short sale against the
box, it will be required to set aside securities equivalent in kind and
amount to the securities sold short (or securities convertible or
exchangeable into such securities) and will be required to hold such
securities while the short sale is outstanding. The Portfolio will incur
transaction costs, including interest expense, in connection with opening,
maintaining, and closing short sales against the box.
STRIPPED GOVERNMENT SECURITIES. Each Portfolio may purchase U.S.
Treasury STRIPS (Separate Trading of Registered Interest and Principal of
Securities), that are created when the coupon payments and the principal
payment are stripped from an outstanding Treasury bond by the Federal
Reserve Bank of New York and sold separately.
TIME DEPOSITS are non-negotiable deposits in a banking
institution earning a specified interest rate over a given period of
time.
VARIABLE OR FLOATING RATE INSTRUMENTS bear variable or floating
interest rates and carry rights that permit holders to demand payment of
the unpaid principal balance plus accrued interest from the issuers or
certain financial intermediaries. Floating rate instruments have interest
rates that change whenever there is a change in a designated base rate,
while variable rate instruments provide for a specified periodic adjustment
in the interest rate. These formulas are designed to result in a market
value for the instrument that approximates its par value.
A Portfolio may invest in variable or floating rate instruments that
ultimately mature in more than 397 days if the Portfolio acquires a right
to sell securities that meet certain requirements set forth in Rule 2a-7.
Variable rate instruments (including instruments subject to a demand
feature) that mature in 397 days or less and U.S. government obligations
with a variable rate of interest reset no less frequently than every 762
days may be deemed to have maturities equal to the period remaining until
the next readjustment of the interest rate. Other variable rate instruments
with demand features may be deemed to have a maturity equal to the longer
of the period remaining until the next readjustment of the interest rate or
the period remaining until the principal amount can be recovered through
demand. A floating rate instrument subject to a demand feature may be
deemed to have a maturity equal to the period remaining until the principal
amount can be recovered through demand.
APPENDIX B
RATINGS
The descriptions that follow are examples of eligible ratings for the
Portfolios. The Portfolios may, however, consider the ratings for other
types of investments and the ratings assigned by other rating organizations
when determining the eligibility of a particular investment
DESCRIPTION OF MOODY'S INVESTORS SERVICE, INC.'S COMMERCIAL PAPER RATINGS:
PRIME-1 - issuers (or related institutions) have a superior capacity for
repayment of short-term promissory obligations. Prime-1 repayment capacity
will normally be evidenced by the following characteristics:
(bullet) Leading market positions in well established industries.
(bullet) High rates of return on funds employed.
(bullet) Conservative capitalization structures with moderate reliance on
debt and ample asset protection.
(bullet) Broad margins in earnings coverage of fixed financial charges with
high internal cash generation.
(bullet) Well-established access to a range of financial markets and
assured sources of alternate liquidity.
PRIME-2 - issuers (or related supporting institutions) have a strong
capacity for repayment of short-term promissory obligations. This will
normally be evidenced by many of the characteristics cited above but to a
lesser degree. Earnings trends and coverage ratios, while sound, will be
more subject to variation. Capitalization characteristics, while still
appropriate, may be more affected by external conditions. Ample alternate
liquidity is maintained.
DESCRIPTION OF MOODY'S INVESTORS SERVICE, INC.'S CORPORATE BOND RATINGS:
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
issuers.
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 appear somewhat
larger than in Aaa securities.
DESCRIPTION OF STANDARD & POOR'S CORPORATION'S COMMERCIAL PAPER
RATINGS:
A-1 - This designation indicates that the degree of safety regarding timely
payment is either overwhelming or very strong. Those issues determined to
possess overwhelming safety characteristics will be denoted with a plus (+)
sign designation.
A-2 - Capacity for timely payment on issues with this designation is
strong. However, the relative degree of safety is not as high as for issues
designated A-1.
DESCRIPTION OF STANDARD & POOR'S CORPORATION'S CORPORATE BOND RATINGS:
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 debt issues
FIDELITY INSTITUTIONAL CASH PORTFOLIOS: U.S. TREASURY PORTFOLIO
INVESTMENTS/MARCH 31, 1994
(SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENTS)
ANNUALIZED
YIELD AT
DUE TIME OF PRINCIPAL VALUE MATURITY VALUE
DATE PURCHASE AMOUNT (NOTE 1) AMOUNT (NOTE 1)
Federal Agencies - 1.2%
EXPORT-IMPORT BANK, U.S. - AGENCY COUPONS
4/15/94 3.81% (a) $ 19,000,000 $ 19,000,000
U.S. Treasury Obligations - 48.4%
U.S. TREASURY BILLS - 25.1%
4/7/94 3.35 25,000,000 24,986,500
5/5/94 3.27 20,000,000 19,940,122
5/5/94 3.30 14,000,000 13,957,501
5/5/94 3.31 56,000,000 55,827,847
5/5/94 3.35 18,000,000 17,944,920
5/26/94 3.30 32,000,000 31,841,111
5/26/94 3.35 50,000,000 49,747,942
6/2/94 3.36 35,000,000 34,801,083
6/30/94 3.30 68,000,000 67,456,000
9/29/94 3.92 70,000,000 68,645,285
10/20/94 3.36 20,000,000 19,631,911
404,780,222
U.S. TREASURY NOTES - 23.3%
4/30/94 3.23 18,000,000 18,028,531
5/15/94 3.16 58,000,000 58,255,988
5/15/94 3.22 62,000,000 62,276,139
7/31/94 3.20 30,000,000 30,093,121
8/15/94 3.07 65,000,000 67,242,805
8/15/94 3.15 10,000,000 10,132,684
8/15/94 3.21 20,000,000 20,260,945
8/15/94 3.81 10,000,000 10,323,870
8/15/94 3.85 27,000,000 27,297,769
8/15/94 3.89 25,000,000 25,432,801
8/31/94 3.18 25,000,000 25,096,248
9/30/94 3.22 5,000,000 5,016,762
1/31/95 3.63 15,000,000 15,068,888
374,526,551
TOTAL U.S. TREASURY OBLIGATIONS 779,306,773
MATURITY
AMOUNT
Repurchase Agreements - 50.4%
With Bear Stearns & Co., Inc.:
At 3.58%, dated 3/25/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $153,285,000)
5.125%, 2/28/98 to 3/31/98 $ 145,554,602 145,410,000
With BT Securities Corp.:
At 3.55%, dated 3/31/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $58,600,000)
10.75%, 8/15/05 $ 75,029,583 $ 75,000,000
With Chemical Securities, Inc.:
At 3.55%, dated 3/31/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $77,275,000)
7.125%, 2/15/23 75,029,583 75,000,000
With Deutsche Bank Government Securities, Inc.:
At 3.55%, dated 3/31/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $205,820,000)
6/30/94 200,078,889 200,000,000
With Goldman, Sachs & Co.:
At 3.82%, dated 3/22/94 due 6/20/94:
U.S. Treasury Obligations
(principal amount $73,906,000)
0% to 8.75%,
7/28/94 to 5/15/16 73,697,150 73,000,000
With Morgan Stanley & Co., Inc.:
At 3.70%, dated 3/31/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $52,956,000)
3.875% to 5.125%,
5/31/94 to 2/28/95 52,021,378 52,000,000
With Nikko Securities Co. International, Inc.:
At 3.75%, dated 3/31/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $73,555,000)
4.625%, 12/31/94 73,030,417 73,000,000
In a joint trading account
(U.S. Treasury Obligations)
dated 3/31/94, due 4/4/94
(Note 2) At 3.58% 116,552,373 116,506,000
TOTAL REPURCHASE AGREEMENTS 809,916,000
TOTAL INVESTMENTS - 100% $ 1,608,222,773
Total Cost for Income Tax Purposes - $1,608,222,773
LEGEND:
(a) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
INCOME TAX INFORMATION:
At March 31,1994, the fund had a capital loss carryforward of approximately
$355,000 of which $29,000, $109,000, $122,000 and $95,000 will expire on
March 31, 1996, 1997, 1999 and 2002, respectively.
For the period ended March 31, 1994, approximately 40% of the fund's
dividends to shareholders was derived from interest on U.S. Government
obligations.
Statement of Assets and Liabilities
March 31, 1994
ASSETS
Investment in securities, at value $ 1,608,222,773
(including repurchase
agreements of $809,916,000)
(Notes 1 and 2) - See
accompanying schedule
Interest receivable 6,229,552
Receivable from investment 67,354
adviser for expense reductions
(Note 5)
TOTAL ASSETS 1,614,519,679
LIABILITIES
Dividends payable $ 2,245,296
Accrued management fee 305,551
Other payables and accrued 91,575
expenses
TOTAL LIABILITIES 2,642,422
NET ASSETS $ 1,611,877,257
Net Assets consist of (Note 1):
Paid in capital $ 1,612,231,931
Accumulated net realized gain (354,674)
(loss) on investments
NET ASSETS, for 1,612,224,343 $ 1,611,877,257
shares outstanding
NET ASSET VALUE, offering price $1.00
and redemption price per share
($1,611,877,257(divided by)
1,612,224,343 shares)
Statement of Operations
Year Ended March 31, 1994
INTEREST INCOME (Note 2) $ 60,917,710
EXPENSES
Management fee (Note 4) $ 3,796,042
Transfer agent fees (Note 4) 150,635
Accounting fees and expenses 192,236
(Note 4)
Non-interested trustees' 10,775
compensation
Custodian fees and expenses 79,762
Registration fees 6,659
Audit 36,377
Legal 22,135
Miscellaneous 25,426
Total expenses before 4,320,047
reductions
Expense reductions (Note 5) (903,610) 3,416,437
NET INTEREST INCOME 57,501,273
NET REALIZED GAIN (LOSS) ON (94,848)
INVESTMENTS (NOTE 1)
NET INCREASE IN NET ASSETS $ 57,406,425
RESULTING FROM OPERATIONS
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
<S> <C> <C>
YEARS ENDED MARCH 31,
1994 1993
INCREASE (DECREASE) IN NET ASSETS
Operations $ 57,501,273 $ 92,723,217
Net interest income
Net realized gain (loss) on investments (94,848) 86,794
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS 57,406,425 92,810,011
Dividends to shareholders from net interest income (57,501,273) (92,723,217)
Share transactions at net asset value of $1.00 per share 11,024,606,904 12,988,431,736
Proceeds from sales of shares
Reinvestment of dividends from net interest income 29,704,546 43,620,453
Cost of shares redeemed (11,479,144,890) (13,624,405,282)
Net increase (decrease) in net assets and shares
resulting from share transactions (424,833,440) (592,353,093)
TOTAL INCREASE (DECREASE) IN NET ASSETS (424,928,288) (592,266,299)
NET ASSETS
Beginning of period 2,036,805,545 2,629,071,844
End of period $ 1,611,877,257 $ 2,036,805,545
</TABLE>
FIDELITY INSTITUTIONAL CASH PORTFOLIOS: U.S. TREASURY PORTFOLIO II
INVESTMENTS/MARCH 31, 1994
(SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENTS)
ANNUALIZED
YIELD AT
DUE TIME OF PRINCIPAL VALUE MATURITY VALUE
DATE PURCHASE AMOUNT (NOTE 1) AMOUNT (NOTE 1)
U.S. Treasury Obligations - 35.1%
U.S. TREASURY BILLS - 18.5%
4/7/94 3.35% $ 55,000,000 $ 54,970,300
5/5/94 3.27 40,000,000 39,880,244
5/5/94 3.30 135,000,000 134,588,080
5/19/94 3.32 32,500,000 32,358,314
5/26/94 3.35 34,000,000 33,828,601
5/26/94 3.30 169,000,000 168,160,868
6/2/94 3.36 125,000,000 124,289,583
6/30/94 3.30 165,000,000 163,680,000
9/29/94 3.92 40,000,000 39,225,878
10/20/94 3.36 53,000,000 52,024,564
843,006,432
U.S. TREASURY NOTES - 16.6%
4/30/94 3.23 42,280,000 42,347,017
5/15/94 3.21 50,000,000 50,222,838
5/15/94 3.37 100,000,000 100,429,191
5/31/94 3.23 23,605,000 23,673,568
7/31/94 3.20 40,000,000 40,124,161
8/15/94 3.07 135,000,000 139,658,133
8/15/94 3.08 108,000,000 111,722,446
8/15/94 3.15 53,500,000 54,209,860
8/15/94 3.78 58,000,000 59,029,588
8/15/94 3.82 5,388,000 5,447,944
8/15/94 3.85 63,000,000 63,694,794
1/31/95 3.63 65,500,000 65,800,814
756,360,354
TOTAL U.S. TREASURY OBLIGATIONS 1,599,366,786
MATURITY
AMOUNT
Repurchase Agreements - 64.9%
With Barclays de Zoete Wedd Government Securities, Inc.:
At 3.65%, dated 3/31/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $78,140,000)
7.875% to 12.375%,
4/15/98 to 5/15/04 $ 100,040,556 100,000,000
With Chemical Securities, Inc.:
At 3.55%, dated 3/31/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $200,055,000)
7% to 7.125%,
9/30/96 to 2/15/23 200,078,889 200,000,000
With Daiwa Securities Co., Ltd.:
At 3.65%, dated 3/31/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $100,625,000)
0% to 10.75%,
6/2/94 to 8/15/05 $ 100,040,556 $ 100,000,000
With Deutsche Bank Government Securities, Inc.:
At 3.55%, dated 3/31/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $205,820,000)
6/30/94 200,078,889 200,000,000
With Donaldson, Lufkin & Jenrette Securities Corp.:
At 3.62%, dated 3/31/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $95,183,000)
0% to 10.75%,
6/2/94 to 5/15/21 100,040,222 100,000,000
With Goldman, Sachs & Co.:
At 3.52%, dated 3/31/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $97,344,000)
5.125% to 7.875%,
11/15/96 to 7/31/96 100,039,111 100,000,000
At 3.82%, dated 3/22/94 due 6/20/94:
U.S. Treasury Obligations
(principal amount $195,360,000)
0% to 12.75%,
7/14/94 to 5/15/21 213,015,050 211,000,000
With Kidder Peabody & Co., Inc.
At 3.60%, dated 3/31/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $95,102,000)
7.50% to 8.50%,
1/31/96 to 7/15/97 100,040,000 100,000,000
With Morgan Stanley & Co., Inc.:
At 3.48%, dated 3/31/94 due 4/1/94:
U.S. Treasury Obligations
(principal amount $10,260,000)
0% to 8%,
9/22/94 to 10/15/96 10,003,867 10,000,000
At 3.70%, dated 3/31/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $128,205,000)
4.25% to 5.125%,
5/31/94 to 11/30/94 128,052,622 128,000,000
MATURITY VALUE
AMOUNT (NOTE 1)
REPURCHASE AGREEMENTS - CONTINUED
With Nikko Securities Co. International, Inc.:
At 3.75%, dated 3/31/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $183,465,000)
6% to 7.875%,
12/31/97 to 5/15/01 $ 193,080,417 $ 193,000,000
With Nomura Securities International, Inc.:
At 3.625%, dated 3/31/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $95,959,000)
0% to 13.875%,
6/2/94 to 2/15/23 100,040,278 100,000,000
With Prudential Securities, Inc.:
At 3.55%, dated 3/31/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $203,425,000)
5.125% to 7.875%,
1/15/98 to 5/31/98 200,078,889 200,000,000
In a joint trading account
(U.S. Treasury Obligations)
dated 3/31/94, due 4/4/94
(Notes 2 and 3)
At 3.55% 831,328,132 831,000,000
At 3.63% 381,338,745 381,185,000
TOTAL REPURCHASE AGREEMENTS 2,954,185,000
TOTAL INVESTMENTS - 100% $ 4,553,551,786
Total Cost for Income Tax Purposes - $4,553,551,786
INCOME TAX INFORMATION:
At March 31, 1994, the fund had a capital loss carryforward of
approximately $235,000 of which $21,000 and $214,000 will expire on March
31, 1999 and 2002, respectively.
For the period ended March 31, 1994, approximately 39% of the fund's
dividends to shareholders was derived from interest on U.S. Government
obligations.
Statement of Assets and Liabilities
<TABLE>
<CAPTION>
<S> <C> <C>
March 31, 1994
ASSETS
Investment in securities, at value (including repurchase agreements of $2,954,185,000) (Notes 1 and 2) $ 4,553,551,786
- - - See accompanying schedule
Cash 28,835
Interest receivable 12,051,981
Receivable from investment adviser for expense reductions (Note 5) 194,398
TOTAL ASSETS 4,565,827,000
LIABILITIES
Dividends payable $ 7,794,463
Accrued management fee 721,085
Other payables and accrued expenses 217,935
TOTAL LIABILITIES 8,733,483
NET ASSETS $ 4,557,093,517
Net Assets consist of (Note 1):
Paid in capital $ 4,557,328,499
Accumulated net realized gain (loss) on investments (234,982)
NET ASSETS $ 4,557,093,517
CALCULATION OF MAXIMUM $1.00
OFFERING PRICE
CLASS A:
NET ASSET VALUE, offering price
and redemption price per share
($4,551,918,095 (divided by)
4,552,015,940 shares)
CLASS B: $1.00
NET ASSET VALUE, offering price
and redemption price per share
($5,175,422 (divided by) 5,175,534
shares)
</TABLE>
Statement of Operations
<TABLE>
<CAPTION>
<S> <C> <C>
Year Ended March 31, 1994
INTEREST INCOME $ 157,072,117
EXPENSES
Management fee (Note 4) $ 9,834,015
Transfer agent fees (Note 4) 1,101,750
Class A
Class B 113
Distribution fees - 2,065
Class B (Note 4)
Accounting fees and expenses (Note 4) 419,147
Non-interested trustees' compensation 39,797
Custodian fees and expenses 173,073
Registration fees - Class A 31,761
Registration fees - Class B 125
Audit 78,302
Legal 58,636
Miscellaneous 70,918
Total expenses before 11,809,702
reductions
Expense reductions (2,956,802) 8,852,900
(Note 5)
NET INTEREST INCOME 148,219,217
NET REALIZED GAIN (LOSS) ON (214,389)
INVESTMENTS (NOTE 1)
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 148,004,828
</TABLE>
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
<S> <C> <C>
YEARS ENDED MARCH 31,
1994 1993
INCREASE (DECREASE) IN NET ASSETS
Operations $ 148,219,217 $ 237,410,019
Net interest income
Net realized gain (loss) on investments (214,389) 7,178
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 148,004,828 237,417,197
Distributions to shareholders from:
Net interest income
Class A (148,201,826) (237,410,019)
Class B (17,391) -
Share transactions - net increase (decrease) at net asset
value of $1.00 per share (Note 6) (1,032,355,168) 112,804,252
TOTAL INCREASE (DECREASE) IN NET ASSETS (1,032,569,557) 112,811,430
NET ASSETS
Beginning of period 5,589,663,074 5,476,851,644
End of period $ 4,557,093,517 $ 5,589,663,074
</TABLE>
FIDELITY INSTITUTIONAL CASH PORTFOLIOS: U.S. GOVERNMENT PORTFOLIO
INVESTMENTS/MARCH 31, 1994
(SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENTS)
ANNUALIZED
YIELD AT
DUE TIME OF PRINCIPAL VALUE MATURITY VALUE
DATE PURCHASE AMOUNT (NOTE 1) AMOUNT (NOTE 1)
Federal Agencies - 53.0%
EXPORT-IMPORT BANK, U.S. - AGENCY COUPONS - 1.1%
4/15/94 3.81% (a) $ 43,204,550 $ 43,204,550
FEDERAL FARM CREDIT BANK - AGENCY COUPONS - 2.8%
10/3/94 3.36 58,000,000 58,006,846
10/3/94 4.13 (b) 48,000,000 47,970,000
105,976,846
FEDERAL HOME LOAN BANK - DISCOUNT NOTES - 1.2%
6/16/94 3.37 45,000,000 44,992,483
FEDERAL HOME LOAN MORTGAGE CORP. - DISCOUNT NOTES - 1.5%
11/28/94 4.18 60,000,000 58,373,250
FEDERAL NATIONAL MORTGAGE ASSOC. - AGENCY COUPONS - 5.6%
4/4/94 3.60 (a) 190,000,000 190,000,000
5/10/94 3.32 10,365,000 10,428,512
6/30/94 3.29 15,000,000 15,004,305
215,432,817
FEDERAL NATIONAL MORTGAGE ASSOC. - DISCOUNT NOTES - 31.8%
4/4/94 3.47 285,000,000 284,917,588
6/7/94 3.37 200,000,000 198,767,944
6/27/94 3.34 214,000,000 212,303,693
6/30/94 3.31 40,000,000 39,678,000
8/1/94 3.20 150,000,000 148,398,750
9/8/94 3.30 2,000,000 1,971,288
9/22/94 3.33 68,490,000 67,410,826
9/23/94 4.01 40,000,000 39,237,777
9/26/94 3.30 100,000,000 98,402,944
9/30/94 4.04 21,835,000 21,398,968
10/25/94 3.40 103,015,000 101,054,367
1,213,542,145
STUDENT LOAN MARKETING ASSOCIATION - AGENCY COUPONS - 9.0%
4/5/94 3.88 (a) 51,000,000 51,060,157
4/5/94 3.90 (a) 170,000,000 170,000,000
6/30/94 3.16 21,000,000 21,007,840
7/1/94 3.74 (a) 100,000,000 100,000,000
342,067,997
TOTAL FEDERAL AGENCIES 2,023,590,088
U.S. Treasury Obligations - 10.2%
U.S. TREASURY BILLS
4/7/94 3.35 115,500,000 115,437,630
5/5/94 3.35 88,000,000 87,730,720
6/2/94 3.36 84,000,000 83,522,600
6/2/94 3.47 52,000,000 51,699,989
10/20/94 3.36 50,000,000 49,079,778
TOTAL U.S. TREASURY OBLIGATIONS 387,470,717
Repurchase Agreements - 36.8%
With Bear Stearns & Co., Inc.:
At 3.58%, dated 3/25/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $251,255,000)
0% to 7.75%,
12/15/94 to 2/28/98 $ 246,269,658 $ 246,025,000
With First Boston Corporation:
At 3.65%, dated 3/25/94 due 4/4/94:
U.S. Government Obligations
(principal amount $354,619,483)
3.856% to 10%,
4/1/99 to 9/1/23 176,178,444 176,000,000
With Goldman, Sachs & Co.:
At 3.82%, dated 3/22/94 due 6/20/94:
U.S. Treasury Obligations
(principal amount $169,531,000)
0% to 14%,
8/18/94 to 8/15/15 179,699,900 178,000,000
With Kidder Peabody & Co., Inc.
At 3.72%, dated 3/28/94 due 4/4/94:
U.S. Government Obligations
(principal amount $163,962,898)
7.05% to 9.461%,
12/1/27 to 1/1/29 160,115,733 160,000,000
With Merrill Lynch Government Securities, Inc.:
At 3.625%, dated 3/28/94 due 4/4/94:
U.S. Government Obligations
(principal amount $81,329,747)
5.625%, 12/1/30 80,056,389 80,000,000
With Paine Webber, Inc.:
At 3.75%, dated 3/28/94 due 4/4/94:
U.S. Government Obligations
(principal amount $80,028,760)
3.793% to 4.457%,
12/1/23 to 1/1/24 80,058,333 80,000,000
In a joint trading account (Note 2)
(U.S. Treasury Obligations)
dated 3/31/94, due 4/4/94
At 3.58% 56,516,486 56,494,000
At 3.61% 52,261,956 52,241,000
(U.S. Government Obligations)
dated 3/31/94, due 4/4/94
At 3.74% 375,155,777 375,000,000
TOTAL REPURCHASE AGREEMENTS 1,403,760,000
TOTAL INVESTMENTS - 100% $ 3,814,820,805
Total Cost for Income Tax Purposes - $3,814,820,805
LEGEND:
(b) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
(b) Security purchased on a delayed delivery basis.
INCOME TAX INFORMATION:
At March 31,1994, the fund had a capital loss carryforward of approximately
$283,000 of which $40,000 and $243,000 will expire on March 31, 2001 and
2002, respectively.
For the period ended March 31, 1994, approximately 36% of the fund's
dividends to shareholders was derived from interest on U.S. Government
obligations.
Statement of Assets and Liabilities
<TABLE>
<CAPTION>
<S> <C> <C>
March 31, 1994
ASSETS
Investment in securities, at value (including repurchase agreements of $1,403,760,000) (Notes 1 and 2) $ 3,814,820,805
- - - See accompanying schedule
Interest receivable 5,461,499
Receivable from investment adviser for expense reductions (Note 5) 236,051
TOTAL ASSETS 3,820,518,355
LIABILITIES
Payable for investments $ 47,970,000
purchased
Share transactions in process 19,997
Dividends payable 7,056,366
Accrued management fee 719,971
Other payables and accrued expenses 207,811
TOTAL LIABILITIES 55,974,145
NET ASSETS $ 3,764,544,210
Net Assets consist of (Note 1):
Paid in capital $ 3,764,827,389
Accumulated net realized gain (loss) on investments (283,179)
NET ASSETS, for 3,764,323,957 shares outstanding $ 3,764,544,210
NET ASSET VALUE, offering price and redemption price per share ($3,764,544,210 (divided by) 3,764,323,957 $1.00
shares)
</TABLE>
Statement of Operations
<TABLE>
<CAPTION>
<S> <C> <C>
Year Ended March 31, 1994
INTEREST INCOME (Note 2) $ 157,127,358
EXPENSES
Management fee (Note 4) $ 9,660,519
Transfer agent fees (Note 4) 878,411
Accounting fees and expenses (Note 4) 412,411
Non-interested trustees' compensation 32,776
Custodian fees and expenses 148,118
Registration fees 43,916
Audit 65,400
Legal 54,891
Miscellaneous 63,612
Total expenses before 11,360,054
reductions
Expense reductions (2,665,587) 8,694,467
(Note 5)
NET INTEREST INCOME 148,432,891
NET REALIZED GAIN (LOSS) ON (243,492)
INVESTMENTS (NOTE 1)
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 148,189,399
</TABLE>
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
<S> <C> <C>
YEARS ENDED MARCH 31,
1994 1993
INCREASE (DECREASE) IN NET ASSETS
Operations $ 148,432,891 $ 220,852,069
Net interest income
Net realized gain (loss) on investments (243,492) (39,687)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS 148,189,399 220,812,382
Dividends to shareholders from net interest income (148,432,891) (220,852,069)
Share transactions at net asset value of $1.00 per share 33,376,241,019 43,021,000,441
Proceeds from sales of shares
Reinvestment of dividends from net interest income 54,284,929 69,113,643
Cost of shares redeemed (35,351,904,003) (42,007,689,675)
Net increase (decrease) in net assets and shares resulting
from share transactions (1,921,378,055) 1,082,424,409
TOTAL INCREASE (DECREASE) IN NET ASSETS (1,921,621,547) 1,082,384,722
NET ASSETS
Beginning of period 5,686,165,757 4,603,781,035
End of period $ 3,764,544,210 $ 5,686,165,757
</TABLE>
FIDELITY INSTITUTIONAL CASH PORTFOLIOS: DOMESTIC MONEY MARKET PORTFOLIO
INVESTMENTS/MARCH 31, 1994
(SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENTS)
ANNUALIZED ANNUALIZED
YIELD AT YIELD AT
DUE TIME OF PRINCIPAL VALUE DUE TIME OF PRINCIPAL VALUE
DATE PURCHASE AMOUNT (NOTE 1) DATE PURCHASE AMOUNT (NOTE 1)
Bankers' Acceptances - 6.6%
Bank of New York
4/28/94 3.44% $ 8,000,000 $ 7,979,480
Chase Manhattan Bank
4/21/94 3.12 6,500,000 6,488,806
5/2/94 3.69 3,897,671 3,885,321
5/3/94 3.69 4,718,760 4,703,325
5/10/94 3.72 5,154,654 5,133,993
Trust Company Bank
4/11/94 3.13 10,000,000 9,991,361
U.S. Bank of Washington
7/11/94 3.27 5,000,000 4,954,830
TOTAL BANKERS' ACCEPTANCES 43,137,116
Certificates of Deposit - 6.1%
Harris Trust & Savings Bank
6/3/94 3.75 10,000,000 10,000,000
Old Kent Bank & Trust Company
4/19/94 3.57 15,000,000 15,000,000
5/31/94 3.75 10,000,000 10,000,000
Old Kent Bank - Southwest
7/25/94 3.28 5,000,000 5,000,000
TOTAL CERTIFICATES OF DEPOSIT 40,000,000
Commercial Paper - 49.4%
American General Finance Corporation
5/16/94 3.67 5,000,000 4,977,187
Bear Stearns Companies Inc.
4/22/94 3.47 10,000,000 9,979,875
4/25/94 3.47 15,000,000 14,965,501
Beneficial Corporation
5/4/94 3.20 10,000,000 9,970,850
5/6/94 3.21 10,000,000 9,969,083
CIESCO, L.P.
5/20/94 3.53 5,000,000 4,976,181
CIT Group Holdings, Inc.
4/21/94 3.29 5,000,000 4,990,945
4/27/94 3.12 5,000,000 4,988,805
Commercial Credit Company
4/18/94 3.43 5,000,000 4,991,948
5/13/94 3.68 5,000,000 4,978,650
CoreStates Capital Corp.
4/8/94 3.62 (a) 5,000,000 5,000,000
Corporate Asset Funding Company, Inc.
4/8/94 3.12 7,700,000 7,695,359
5/5/94 3.13 4,300,000 4,287,410
Corporate Receivables Corp.
4/7/94 3.46% $ 6,000,000 $ 5,996,550
Dean Witter, Discover & Co.
4/15/94 3.15 5,000,000 4,993,914
5/24/94 3.76 6,000,000 5,966,963
Deere & Company
5/11/94 3.67 5,000,000 4,979,722
Ford Motor Credit Corporation
4/4/94 3.22 4,000,000 3,998,933
4/12/94 3.53 10,000,000 9,989,245
General Electric Capital Services Inc.
7/22/94 3.30 5,000,000 4,949,445
General Motors Acceptance Corporation
5/11/94 3.80 2,000,000 1,991,600
5/17/94 3.80 10,000,000 9,951,700
5/23/94 3.82 10,000,000 9,945,111
6/27/94 4.00 6,000,000 5,942,580
Goldman Sachs Group, L.P. (The)
4/26/94 3.12 5,000,000 4,989,236
5/20/94 3.19 10,000,000 9,957,125
Hewlett-Packard Company
4/13/94 3.46 10,000,000 9,988,500
IBM Credit Corporation
5/16/94 3.74 5,000,000 4,976,750
J.C. Penney Funding Corporation
4/18/94 3.52 5,000,000 4,991,736
Merck & Company, Inc.
5/27/94 3.40 5,000,000 4,973,944
Merrill Lynch & Co., Inc.
4/14/94 3.14 10,000,000 9,988,733
4/20/94 3.14 5,000,000 4,991,767
Morgan Stanley Group, Inc.
4/29/94 3.52 5,000,000 4,986,389
New Center Asset Trust
4/29/94 3.62 5,000,000 4,986,000
5/9/94 3.77 6,000,000 5,976,250
Norfolk Funding Corp.
4/19/94 3.12 1,737,000 1,734,307
PHH Corporation
4/18/94 3.63 10,000,000 9,982,905
Preferred Receivables Funding Corporation
4/6/94 3.54 10,000,000 9,995,097
4/7/94 3.54 10,000,000 9,994,116
4/21/94 3.61 5,000,000 4,990,000
ANNUALIZED ANNUALIZED
YIELD AT YIELD AT
DUE TIME OF PRINCIPAL VALUE DUE TIME OF PRINCIPAL VALUE
DATE PURCHASE AMOUNT (NOTE 1) DATE PURCHASE AMOUNT (NOTE 1)
Commercial Paper - CONTINUED
Texaco Inc.
4/11/94 3.61% $ 8,000,000 $ 7,992,000
U.S. Leasing International, Inc.
4/25/94 3.58 7,000,000 6,983,341
4/26/94 3.70 10,000,000 9,974,444
5/23/94 3.72 15,000,000 14,919,833
Weyerhaeuser Company
4/12/94 3.54 7,108,000 7,100,333
Whirlpool Financial Corporation
4/5/94 3.61 5,000,000 4,998,000
4/20/94 3.63 5,000,000 4,990,448
TOTAL COMMERCIAL PAPER 324,938,811
Federal Agencies - 8.8%
FEDERAL FARM CREDIT BANK - DISCOUNT NOTES - 3.3%
4/5/94 3.12 13,970,000 13,965,188
5/6/94 3.41 6,000,000 5,980,225
5/10/94 3.42 1,900,000 1,893,022
21,838,435
FEDERAL HOME LOAN BANK - DISCOUNT NOTES - 2.3%
6/16/94 3.37 7,000,000 6,998,831
8/29/94 3.97 8,000,000 7,870,000
14,868,831
FEDERAL NATIONAL MORTGAGE ASSOC. - DISCOUNT NOTES - 1.7%
5/12/94 3.42 1,370,000 1,364,712
6/30/94 3.23 10,000,000 9,920,250
11,284,962
STUDENT LOAN MARKETING ASSOCIATION - AGENCY COUPONS - 1.5%
4/5/94 3.83 (a) 10,000,000 10,000,000
TOTAL FEDERAL AGENCIES 57,992,228
Bank Notes (a) - 1.5%
Bank of New York
6/6/94 3.80 10,000,000 10,000,000
Medium-Term Notes (a) - 6.6%
Bank One, Milwaukee, N.A.
4/4/94 3.55 5,000,000 4,995,397
CIESCO, L.P.
6/24/94 3.66 10,000,000 10,000,000
General Motors Acceptance Corporation
5/7/94 3.48 6,000,000 6,000,000
Goldman Sachs Group, L.P. (The) (b)
6/16/94 3.46% $ 7,500,000 $ 7,500,000
9/1/94 3.46 8,000,000 8,000,000
Norwest Corporation
9/15/94 3.89 7,000,000 7,000,000
TOTAL MEDIUM-TERM NOTES 43,495,397
Short-Term Notes (a) - 11.8%
CSA Funding (C)
4/8/94 3.90 10,000,000 10,000,000
J.P. Morgan Securities
4/4/94 3.94 14,000,000 14,000,000
4/4/94 3.96 8,000,000 8,000,000
Morgan Stanley Group, Inc.
4/4/94 3.89 10,000,000 10,000,000
Norwest Corporation
4/4/94 3.69 9,000,000 9,000,000
SMM Trust Company (1993-E) (c)
4/13/94 3.30 5,000,000 5,000,000
SMM Trust Company (1993-F) (c)
5/15/94 3.60 2,000,000 2,000,000
SMM Trust Company (1994-A) (c)
6/18/94 3.92 20,000,000 20,000,000
TOTAL SHORT-TERM NOTES 78,000,000
MATURITY
AMOUNT
Repurchase Agreements - 9.2%
With Goldman, Sachs & Co.
At 3.70%, dated 3/29/94 due 4/4/94
(U.S. Treasury Obligations)
(principal amount $20,107,489)
5% to 9.75%,
11/1/00 to 11/1/26 $ 10,006,167 10,000,000
In a joint trading account
(U.S. Treasury Obligations)
dated 3/31/94, due 4/4/94
(Note 2) At 3.61% 50,345,187 50,325,000
TOTAL REPURCHASE AGREEMENTS 60,325,000
TOTAL INVESTMENTS - 100% $ 657,888,552
Total Cost for Income Tax Purposes - $657,888,552
LEGEND:
(a) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
(b) Security exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At the period
end, the value of these securities amounted to $15,500,000 or 2.4% of net
assets.
(c) Restricted securities - Investment in securities not registered under
the Securities Act of 1933 (see Note 2 of Notes to Financial Statements).
Additional information on each holding is as follows:
ACQUISITION ACQUISITION
SECURITY DATE COST
SMM Trust Company:
(1993-E), 3.30% 4/13/94 1/13/94 $ 5,000,000
(1993-F), 3.60% 5/15/94 11/15/93 $ 2,000,000
(1994-A), 3.92% 6/18/94 3/17/94 $ 20,000,000
INCOME TAX INFORMATION:
At March 31, 1994, the fund had a capital loss carryforward of
approximately $49,000 which will expire on March 31, 2001.
For the period ended March 31, 1994, approximately 4% of the fund's
dividends to shareholders was derived from interest on U.S. Government
obligations.
Statement of Assets and Liabilities
<TABLE>
<CAPTION>
<S> <C> <C>
March 31, 1994
ASSETS
Investment in securities, at value (including repurchase agreements of $60,325,000) (Notes 1 and 2) - $ 657,888,552
See accompanying schedule
Cash 32,268
Interest receivable 667,429
Receivable from investment adviser for expense reductions (Note 5) 55,471
TOTAL ASSETS 658,643,720
LIABILITIES
Dividends payable $ 1,485,693
Accrued management fee 116,830
Other payables and accrued expenses 65,150
TOTAL LIABILITIES 1,667,673
NET ASSETS $ 656,976,047
Net Assets consist of (Note 1):
Paid in capital $ 657,025,071
Accumulated net realized gain (loss) on investments (49,024)
NET ASSETS, for 657,009,441 shares outstanding $ 656,976,047
NET ASSET VALUE, offering price and redemption price per share ($656,976,047 (divided by) 657,009,441 shares) $1.00
</TABLE>
Statement of Operations
<TABLE>
<CAPTION>
<S> <C> <C>
Year Ended March 31, 1994
INTEREST INCOME $ 24,916,686
EXPENSES
Management fee (Note 4) $ 1,525,574
Transfer agent fees (Note 4) 262,203
Accounting fees and expenses (Note 4) 107,464
Non-interested trustees' compensation 4,626
Custodian fees and expenses 76,513
Registration fees 2,355
Audit 14,434
Legal 8,715
Miscellaneous 9,683
Total expenses before 2,011,567
reductions
Expense reductions (638,552) 1,373,015
(Note 5)
NET INTEREST INCOME 23,543,671
NET REALIZED GAIN (LOSS) ON 1,208
INVESTMENTS (NOTE 1)
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 23,544,879
</TABLE>
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
<S> <C> <C>
YEARS ENDED MARCH 31,
1994 1993
INCREASE (DECREASE) IN NET ASSETS
Operations $ 23,543,671 $ 26,374,938
Net interest income
Net realized gain (loss) on investments 1,208 (50,232)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS 23,544,879 26,324,706
Dividends to shareholders from net interest income (23,543,671) (26,374,938)
Share transactions at net asset value of $1.00 per share 6,042,925,540 4,699,841,350
Proceeds from sales of shares
Reinvestment of dividends from net interest income 6,177,168 7,989,482
Cost of shares redeemed (6,196,482,006) (4,462,153,962)
Net increase (decrease) in net assets and shares resulting
from share transactions (147,379,298) 245,676,870
TOTAL INCREASE (DECREASE) IN NET ASSETS (147,378,090) 245,626,638
NET ASSETS
Beginning of period 804,354,137 558,727,499
End of period $ 656,976,047 $ 804,354,137
</TABLE>
FIDELITY INSTITUTIONAL CASH PORTFOLIOS: MONEY MARKET PORTFOLIO
INVESTMENTS/MARCH 31, 1994
(SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENTS)
ANNUALIZED ANNUALIZED
YIELD AT YIELD AT
DUE TIME OF PRINCIPAL VALUE DUE TIME OF PRINCIPAL VALUE
DATE PURCHASE AMOUNT (NOTE 1) DATE PURCHASE AMOUNT (NOTE 1)
Certificates of Deposit - 11.2%
NEW YORK BRANCH, YANKEE DOLLAR, FOREIGN BANKS - 8.2%
Fuji Bank, Ltd.
5/3/94 3.77% $ 25,000,000 $ 24,997,324
5/9/94 3.75 40,000,000 40,000,000
Mitsubishi Bank, Ltd.
4/4/94 3.25 25,000,000 25,000,000
National Bank of Canada
5/5/94 3.30 40,000,000 40,000,000
Societe Generale
4/25/94 3.43 50,000,000 50,000,000
6/1/94 3.75 75,000,000 75,000,000
6/9/94 3.73 15,000,000 14,994,144
269,991,468
LONDON BRANCH, EURODOLLAR, FOREIGN BANKS - 3.0%
Banco Bilbao Vizcaya, S.A.
8/11/94 3.90 4,000,000 3,995,857
8/11/94 3.91 4,000,000 3,995,713
Bank of Tokyo
4/29/94 3.25 50,000,000 49,997,254
Sumitomo Bank, Ltd.
4/27/94 3.43 25,000,000 24,998,924
4/27/94 3.50 15,000,000 14,998,781
97,986,529
TOTAL CERTIFICATES OF DEPOSIT 367,977,997
Commercial Paper - 29.8%
ABN-AMRO North America, N.V.
6/3/94 3.54 40,000,000 39,755,000
6/8/94 3.54 30,000,000 29,801,667
Budget Funding Corporation
4/27/94 3.68 30,000,000 29,920,483
Concord Leasing, Inc. (LOC Hong Kong & Shanghai Banking Corp.)
5/3/94 3.48 21,500,000 21,434,641
Den Danske Corporation, Inc.
4/4/94 3.36 50,000,000 49,986,125
5/12/94 3.70 8,000,000 7,966,562
6/30/94 3.79 25,000,000 24,766,250
Dresdner U.S. Finance Inc.
8/24/94 3.85 50,000,000 49,238,750
8/29/94 3.82 25,000,000 24,609,376
Ford Motor Credit Corporation
9/6/94 4.08 25,000,000 24,561,111
GTE Corporation
4/6/94 3.66 31,000,000 30,984,285
General Electric Capital Corporation
4/18/94 3.52% $ 25,000,000 $ 24,958,680
General Motors Acceptance Corporation
5/16/94 3.80 65,000,000 64,692,875
6/1/94 3.75 75,000,000 74,527,250
Goldman Sachs Group, L.P. (The)
7/6/94 4.00 35,000,000 34,631,333
HYPO U.S. Finance
4/14/94 3.38 20,000,000 19,975,877
Hanson Finance (UK) PLC
6/6/94 3.85 30,000,000 29,790,450
Household Finance Corporation
4/27/94 3.62 18,000,000 17,953,200
IBM Credit Corporation
5/16/94 3.74 30,000,000 29,860,500
Leeds Permanent Building Society
4/26/94 3.36 50,000,000 49,884,723
Morgan Stanley Group, Inc.
4/25/94 3.52 30,000,000 29,930,000
New Center Asset Trust
5/9/94 3.77 30,000,000 29,881,250
5/10/94 3.77 80,000,000 79,675,000
Republic New York Corp.
4/6/94 3.44 35,000,000 34,983,375
Ridge Capital II (LOC Dai-Ichi Kangyo Bank)
4/11/94 3.65 5,000,000 4,994,944
Sears Credit Corp. (A)
4/11/94 3.64 15,000,000 14,984,876
Sears Credit Corp. (B)
4/12/94 3.64 7,000,000 6,992,235
4/27/94 3.71 50,000,000 49,866,389
Toronto Dominion Holdings USA, Inc.
4/8/94 3.51 25,000,000 24,982,986
Union Bank of Switzerland
4/6/94 3.65 25,000,000 24,987,327
TOTAL COMMERCIAL PAPER 980,577,520
Federal Agencies - 4.9%
FEDERAL NATIONAL MORTGAGE ASSOC. - DISCOUNT NOTES - 4.6%
9/1/94 4.02 25,000,000 24,580,313
9/26/94 3.32 68,000,000 66,907,277
9/30/94 3.33 42,000,000 41,309,917
11/21/94 3.60 20,000,000 19,545,000
152,342,507
ANNUALIZED
YIELD AT
DUE TIME OF PRINCIPAL VALUE MATURITY VALUE
DATE PURCHASE AMOUNT (NOTE 1) AMOUNT (NOTE 1)
FEDERAL AGENCIES - CONTINUED
INTERNATIONAL BANK OF RECONSTRUCTION AND DEVELOPMENT -
DISCOUNT NOTES - 0.3%
12/23/94 3.52% $ 10,000,000 $ 9,748,039
TOTAL FEDERAL AGENCIES 162,090,546
Medium-Term Notes (a) - 17.9%
Abbey National PLC, UK
6/24/94 3.74 30,000,000 30,000,000
Abbey National Treasury Service
9/30/94 3.87 247,000,000 247,000,000
Bank One, Milwaukee, N.A.
4/4/94 3.55 35,000,000 34,967,781
General Motors Acceptance Corporation
5/7/94 3.48 50,000,000 50,000,000
Goldman Sachs Group, L.P. (The) (b)
6/16/94 3.50 56,000,000 56,000,000
9/1/94 3.50 53,000,000 53,000,000
Norwest Corporation
9/15/94 3.89 65,000,000 65,000,000
PHH Corporation
4/4/94 4.00 54,000,000 54,000,000
TOTAL MEDIUM-TERM NOTES 589,967,781
Short-Term Notes (a) - 19.2%
J.P. Morgan Securities
4/4/94 3.94 105,000,000 105,000,000
4/4/94 3.96 63,000,000 63,000,000
Kingdom of Sweden
4/20/94 3.62 40,000,000 40,000,000
6/23/94 3.81 40,000,000 40,000,000
6/23/94 3.94 39,500,000 39,500,000
Morgan Stanley Group, Inc.
4/4/94 3.89 50,000,000 50,000,000
Norwest Corporation
4/4/94 3.69 32,000,000 32,000,000
SMM Trust Company (1993-D) (c)
4/28/94 3.30 23,000,000 23,000,000
SMM Trust Company (1993-E) (c)
4/13/94 3.30 30,000,000 30,000,000
SMM Trust Company (1994-A) (c)
6/18/94 3.92 154,000,000 154,000,000
Swedish National Housing Finance Corp.
5/23/94 3.64 54,000,000 54,000,000
TOTAL SHORT-TERM NOTES 630,500,000
Repurchase Agreements - 17.0%
With Goldman, Sachs & Co.:
At 3.70% dated 3/31/94 due 4/5/94
(U.S. Treasury Obligations)
(principal amount $387,256,546)
5.07% to 9.50%,
1/1/97 to 10/1/23 $ 150,077,083 $ 150,000,000
In a joint trading account
(U.S. Treasury Obligations)
dated 3/31/94, due 4/4/94
(Note 2)
At 3.58% 160,375,809 160,312,000
At 3.61% 150,933,521 150,873,000
At 3.63% 19,871,011 19,863,000
(U.S. Government Obligations)
dated 3/31/94, due 4/4/94
At 3.70% 79,700,752 79,668,000
TOTAL REPURCHASE AGREEMENTS 560,716,000
TOTAL INVESTMENTS - 100% $ 3,291,829,844
Total Cost for Income Tax Purposes - $3,291,829,844
LEGEND:
(a) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
(b) Security exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At the period
end, the value of these securities amounted to $109,000,000 or 3.3% of net
assets.
(d) Restricted securities - Investment in securities not registered under
the Securities Act of 1933 (see Note 2 of Notes to Financial Statements).
Additional information on each holding is as follows:
ACQUISITION ACQUISITION
SECURITY DATE COST
SMM Trust Company:
(1993-D), 3.30% 4/28/94 1/28/94 $ 23,000,000
(1993-E), 3.30% 4/13/94 1/13/93 $ 30,000,000
(1994-A), 3.92% 6/18/94 3/17/94 $ 154,000,000
INCOME TAX INFORMATION:
At March 31, 1994, the fund had a capital loss carryforward of
approximately $1,234,000 of which $336,000 and $898,000 will expire on
March 31, 2001 and 2002, respectively.
Statement of Assets and Liabilities
<TABLE>
<CAPTION>
<S> <C> <C>
March 31, 1994
ASSETS
Investment in securities, at value (including repurchase agreements of $560,716,000) (Notes 1 and 2) - $ 3,291,829,844
See accompanying schedule
Cash 16,429
Interest receivable 6,010,984
Receivable from investment adviser for expense reductions (Note 5) 147,301
TOTAL ASSETS 3,298,004,558
LIABILITIES
Dividends payable $ 7,332,351
Accrued management fee 691,645
Other payables and accrued expenses 240,534
TOTAL LIABILITIES 8,264,530
NET ASSETS $ 3,289,740,028
Net Assets consist of (Note 1):
Paid in capital $ 3,290,974,257
Accumulated net realized gain (loss) on investments (1,234,229)
NET ASSETS $ 3,289,740,028
CALCULATION OF MAXIMUM $1.00
OFFERING PRICE
CLASS A:
NET ASSET VALUE, offering price
and redemption price per share
($3,200,277,483 (divided by)
3,201,455,124 shares)
CLASS B: $1.00
NET ASSET VALUE, offering price
and redemption price per share
($89,462,545 (divided by) 89,495,467
shares)
</TABLE>
Statement of Operations
<TABLE>
<CAPTION>
<S> <C> <C>
Year Ended March 31, 1994
INTEREST INCOME $ 175,572,240
EXPENSES
Management fee (Note 4) $ 10,551,990
Transfer agent fees (Note 4) 515,041
Class A
Class B 1,860
Distribution fees - 40,685
Class B (Note 4)
Accounting fees and expenses (Note 4) 445,362
Non-interested trustees' compensation 60,010
Custodian fees and expenses 225,706
Registration fees - Class B 125
Audit 66,002
Legal 59,016
Miscellaneous 16,363
Total expenses before 11,982,160
reductions
Expense reductions (2,444,993) 9,537,167
(Note 5)
NET INTEREST INCOME 166,035,073
NET REALIZED GAIN (LOSS) ON (897,770)
INVESTMENTS (NOTE 1)
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 165,137,303
</TABLE>
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
<S> <C> <C>
YEARS ENDED MARCH 31,
1994 1993
INCREASE (DECREASE) IN NET ASSETS
Operations $ 166,035,073 $ 176,149,858
Net interest income
Net realized gain (loss) on investments (897,770) 4,613,541
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS 165,137,303 180,763,399
Distributions to shareholders from:
Net interest income
Class A (165,655,489) (176,149,858)
Class B (379,584) -
Share transactions - net increase (decrease) at net asset
value of $1.00 per share (Note 6) (1,042,357,311) 337,986,473
TOTAL INCREASE (DECREASE) IN NET ASSETS (1,043,255,081) 342,600,014
NET ASSETS
Beginning of period 4,332,995,109 3,990,395,095
End of period $ 3,289,740,028 $ 4,332,995,109
</TABLE>
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD ENDED MARCH 31, 1994
1. SIGNIFICANT ACCOUNTING POLICIES.
U.S. Treasury, U.S. Treasury II, U.S. Government, Domestic Money Market and
Money Market Portfolios (the funds) are funds of Fidelity Institutional
Cash Portfolios (the trust) and each fund is authorized to issue an
unlimited number of shares. The trust is registered under the Investment
Company Act of 1940, as amended (the 1940 Act), as an open-end management
investment company organized as a Delaware business trust.
Each fund currently offers two classes of shares, Class A and Class B, each
of which has equal rights as to earnings, assets and voting privileges
except that each class bears different distribution and transfer agent
expenses and certain registration fees. Each class has exclusive voting
rights with respect to its distribution plans. U.S. Treasury Portfolio II
and Money Market Portfolio commenced sale of Class B shares on October 22,
1993 and November 17, 1993, respectively.
The following summarizes the significant accounting policies of the funds:
SECURITY VALUATION. As permitted under Rule 2a-7 of the 1940 Act, and
certain conditions therein, securities are valued initially at cost and
thereafter assume a constant amortization to maturity of any discount or
premium.
INCOME TAXES. As a qualified regulated investment company under Subchapter
M of the Internal Revenue Code, each fund is not subject to income taxes to
the extent that it distributes all of its taxable income for the fiscal
year. The schedules of investments include information regarding income
taxes under the caption "Income Tax Information."
INTEREST INCOME. Interest income, which includes amortization of premium
and accretion of original issue discount, is accrued as earned.
ALLOCATED EARNINGS AND EXPENSES. Investment income, expenses (other than
expenses incurred under each class' Distribution and Service Plans,Transfer
Agent Agreements and certain registration fees) and realized and unrealized
gains or losses on investments are allocated to each class of shares based
upon their relative net assets.
DISTRIBUTIONS TO SHAREHOLDERS. Dividends are declared daily and paid
monthly from net interest income.
Income and capital gain distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles.
CHANGE IN ACCOUNTING FOR DISTRIBUTIONS TO SHAREHOLDERS. Effective April 1,
1993, the funds adopted Statement of Position 93-2: Determination,
Disclosure, and Financial Statement Presentation of Income, Capital Gain,
and Return of Capital Distributions by Investment Companies. As a result,
the funds changed the classification of distributions to shareholders to
better disclose the differences between financial statement amounts and
distributions determined in accordance with income tax regulations.
Accordingly, amounts as of March 31, 1993 have been reclassified as
follows:
INCREASE (DECREASE) INCREASE (DECREASE) (INCREASE) DECREASE
FUND IN PAID IN CAPITAL IN ACCUMULATED NET REALIZED GAIN IN ACCUMULATED NET
REALIZED LOSS
U.S. Treasury $ 7,588 - $ (7,588)
U.S. Treasury II $ 137,025 $ (137,025) -
U.S. Government $ 503,432 $ (503,432) -
Domestic Money Market $ 15,630 - $ (15,630)
Money Market $ 23,666 - $ (23,666)
SECURITY TRANSACTIONS. Security transactions are accounted for as of trade
date. Gains and losses on securities sold are determined on the basis of
identified cost.
2. OPERATING POLICIES.
REPURCHASE AGREEMENTS. The funds, through their custodian, receive delivery
of the underlying securities, whose market value is required to be at least
102% of the resale price at the time of purchase. The funds' investment
adviser, Fidelity Management & Research Company (FMR), is responsible
for determining that the value of these underlying securities remains at
least equal to the resale price.
2. OPERATING POLICIES - CONTINUED
JOINT TRADING ACCOUNT. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the funds, along with other registered
investment companies having management contracts with FMR, may transfer
uninvested cash balances into a joint trading account. These balances are
invested in one or more repurchase agreements that are collateralized by
U.S. Treasury or Federal Agency obligations.
REVERSE REPURCHASE AGREEMENTS. Each fund, other than U.S. Treasury
Portfolio II, is permitted to engage in reverse repurchase agreements for
temporary purposes when it is able to invest the cash so acquired at a rate
higher than the cost related to the agreement. Both the U.S. Treasury and
U.S. Government funds engaged in reverse repurchase agreements during the
period earning net interest income of $105,254 and $195,391, respectively,
which is included in Interest Income on the Statement of Operations.
RESTRICTED SECURITIES. The Domestic Money Market and Money Market funds are
permitted to invest in privately placed restricted securities. These
securities may be resold in transactions exempt from registration or to the
public if the securities are registered. Disposal of these securities may
involve time-consuming negotiations and expense, and prompt sale at an
acceptable price may be difficult. At the end of the period, restricted
securities (excluding 144A issues) amounted to $27,000,000 or 4.1% of net
assets for the Domestic Money Market fund and $207,000,000 or 6.3% of net
assets for the Money Market fund.
3. JOINT TRADING ACCOUNT.
At the end of the period, the U.S. Treasury II fund had 20% or more of its
total investments in repurchase agreements through a joint trading account.
These repurchase agreements were with entities whose creditworthiness has
been reviewed and found satisfactory by FMR. The repurchase agreements were
dated March 31, 1994 and due April 4, 1994. The maturity values of the
joint trading account investments were $831,328,132 at 3.55% and
$381,338,745 at 3.63%. The investments in repurchase agreements through the
joint trading account are summarized as follows:
SUMMARY OF JOINT TRADING ACCOUNT
MAXIMUM
AMOUNT AGGREGATE AGGREGATE AGGREGATE
NO. OF WITH ONE PRINCIPAL MATURITY MARKET COUPON MATURITY
DEALERS DEALER AMOUNT OF AMOUNT OF VALUE OF RATES OF DATES OF
OR BANKS OR BANK AGREEMENTS AGREEMENTS COLLATERAL COLLATERAL COLLATERAL
At 3.55% 11 18.4% $2,169,000,000 $2,169,856,460 $2,508,414,191 0%-13.375%
4/28/94-8/15/21
At 3.63% 6 38.5 520,000,000 520,209,733 530,945,427 0%-13.375%
4/28/94-8/15/21
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As each fund's investment adviser, FMR receives a fee that
is computed daily at an annual rate of .20% of the funds' average net
assets.
SUB-ADVISER FEE. As each fund's investment sub-adviser, FMR Texas Inc., a
wholly owned subsidiary of FMR, receives a fee from FMR of 50% of the
management fee payable to FMR. The fees are paid prior to any voluntary
expense reimbursements which may be in effect, and after reducing the fee
for any payments by FMR pursuant to each fund's Distribution and Service
Plan.
DISTRIBUTION AND SERVICE PLAN. Pursuant to the Distribution and Service
Plans of Class B, (the Plan), and in accordance with Rule 12b-1 of the 1940
Act, each Class B fund pays Fidelity Distributors Corporation (FDC), an
affiliate of FMR, a distribution and service fee that is based on an annual
rate of .32% of its average net assets. For the period, Class B of the U.S.
Treasury II and Money Market funds paid FDC $2,065 and $40,685,
respectively, of which $1,433 and $2,583, respectively, was paid to
securities dealers, banks and other financial institutions for selling
shares and providing shareholder support services.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED
TRANSFER AGENT FEE. Fidelity Investments Institutional Operations Company
(FIIOC), an affiliate of FMR, is the funds' transfer, dividend disbursing
and shareholder servicing agent. FIIOC receives fees based on the type,
size, number of accounts and the number of transactions made by
shareholders. FIIOC pays for typesetting, printing and mailing of all
shareholder reports, except proxy statements.
ACCOUNTING FEE. Fidelity Service Co. an affiliate of FMR, maintains the
funds' accounting records. The fee is based on the level of average net
assets for the month plus out-of-pocket expenses.
5. EXPENSE REDUCTIONS.
FMR voluntarily agreed to reimburse the funds' operating expenses
(excluding interest, taxes, brokerage commissions, extraordinary expenses
and 12b-1 fees payable by Class B of each fund's shares) above an annual
rate of .18% of average net assets. For the period, the reimbursement
reduced expenses by $903,610, $2,956,232 and $570, $2,665,587, $638,552
and, $2,437,428 and $7,565 for U.S. Treasury, U.S. Treasury II and U.S.
Treasury II Class B, U.S. Government, Domestic Money Market and, Money
Market and Money Market Class B funds, respectively.
6. SHARE TRANSACTIONS.
Share transactions for both classes of the U.S. Treasury II and Money
Market funds, at net asset value of $1.00 per share, were as follows:
YEARS ENDED MARCH 31,
1994 1993
U.S. TREASURY II CLASS A
Proceeds from sales of shares $ 37,652,306,847 $ 52,467,399,178
Reinvestment of dividends from net interest income 53,681,583
82,378,656
Cost of shares redeemed (38,743,519,132) (52,436,973,582)
Net increase (decrease) in net assets and shares resulting from share
transactions $ (1,037,530,702) $ 112,804,252
U.S. TREASURY II CLASS B *
Proceeds from sales of shares $ 11,853,621 $ -
Reinvestment of dividends from net interest income 14,790 -
Cost of shares redeemed (6,692,877) -
Net increase (decrease) in net assets and shares resulting from share
transactions $ 5,175,534 $ -
(*) Share transactions for U.S. Treasury II Class B are for the period
October 22, 1993 (commencement of sale of shares) to March 31, 1994.
MONEY MARKET CLASS A
Proceeds from sales of shares $ 48,632,985,539 $ 38,749,029,940
Reinvestment of dividends from net interest income 59,354,442
66,490,395
Cost of shares redeemed (49,824,192,759) (38,477,533,862)
Net increase (decrease) in net assets and shares resulting from share
transactions $ (1,131,852,778) $ 337,986,473
MONEY MARKET CLASS B *
Proceeds from sales of shares $ 112,664,085 $ -
Reinvestment of dividends from net interest income 379,584 -
Cost of shares redeemed (23,548,202) -
Net increase (decrease) in net assets and shares resulting from share
transactions $ 89,495,467 $ -
(*) Share transactions for Money Market Class B are for the period November
17, 1993 (commencement of sale of shares) to March 31, 1994.
NEITHER THE TRUST NOR FIDELITY DISTRIBUTORS CORPORATION IS A BANK AND FUND
SHARES ARE NOT BACKED OR GUARANTEED BY
ANY BANK OR INSURED BY THE FDIC.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees and Shareholders of Fidelity Institutional Cash Portfolios:
U.S. Treasury Portfolio, U.S. Treasury Portfolio II, U.S. Government
Portfolio,
Money Market Portfolio and Domestic Money Market Portfolio
In our opinion, the accompanying statements of assets and liabilities,
including the schedules of investments, and the related statements of
operations and of changes in net assets and the per-share data and ratios
(included on pages 4 through 7 of this Prospectus and Statement of
Additional Information) present fairly, in all material respects, the
financial position of Fidelity Institutional Cash Portfolios: U.S. Treasury
Portfolio, U.S. Treasury Portfolio II, U.S. Government Portfolio, Money
Market Portfolio and Domestic Money Market Portfolio at March 31, 1994, and
the results of their operations for the year then ended, the changes in
their net assets for each of the two years then ended, and their per-share
data and ratios for the periods indicated, in conformity with generally
accepted accounting principles. These financial statements and per-share
data and ratios (hereafter referred to as "financial statements") are the
responsibility of the Trust's management; our responsibility is to express
an opinion on these financial statements based on our audits. We conducted
our audits in accordance with generally accepted auditing standards, which
require that we plan and perform the audits to obtain reasonable assurance
about whether the financial statements are free of material misstatement.
An audit includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management,
and evaluating the overall financial statement presentation. We believe
that our audits, which included confirmation of securities owned at March
31, 1994 by correspondence with the custodian and brokers, provide a
reasonable basis for the opinion expressed above.
PRICE WATERHOUSE
Dallas, Texas
May 13, 1994
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FIDELITY INSTITUTIONAL CASH PORTFOLIOS - CLASS B
U.S. Treasury Portfolio
U.S. Treasury Portfolio II
U.S. Government Portfolio
Domestic Money Market Portfolio
82 DEVONSHIRE STREET
BOSTON, MASSACHUSETTS 02109
Money Market Portfolio
PROSPECTUS AND STATEMENT OF ADDITIONAL INFORMATION
Fidelity Institutional Cash Portfolios (the Fund) offers investors a
convenient and economical way to invest in professionally managed money
market portfolios (the Portfolios). Each Portfolio's investment
objective is to obtain as high a level of current income as is consistent
with the preservation of principal and liquidity within the standards
prescribed for the Portfolio.
Each Portfolio is comprised of two classes of shares, Class A and Class B.
Both Classes share a common investment objective and investment portfolio.
Class B shares are offered through this Prospectus and Statement of
Additional Information to institutional and corporate investors that invest
through a bank or other financial intermediary. Class A shares are offered
by a separate prospectus.
AN INVESTMENT IN THE PORTFOLIOS IS NEITHER INSURED NOR GUARANTEED BY THE
U.S. GOVERNMENT AND THERE CAN BE NO ASSURANCE THAT THE PORTFOLIOS WILL
MAINTAIN A STABLE $1.00 SHARE PRICE.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED BY,
ANY DEPOSITORY INSTITUTION, NOR ARE THEY INSURED BY THE FDIC. INVESTMENT IN
THE PORTFOLIO(S) INVOLVES INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF
PRINCIPLE.
This Prospectus and Statement of Additional Information is designed to
provide investors with information that they should know before investing.
Please read and retain this document for future reference. The Annual
Report to Shareholders of the Fund is incorporated herein. To obtain
additional copies of this document, please call the number below.
For further information, or assistance in opening a new account, please
call:
NATIONWIDE 800-843-3001
TABLE OF CONTENTS
Summary of Expenses
Fund Summary
Financial Highlights
Investment Objective
Investment Policies, Risks and Limitations
How to Invest, Exchange and Redeem
Distributions and Taxes
Portfolio Transactions
Performance
Management Contracts, Distribution Plans
and Service Agreements
Description of the Fund
Appendix A
Appendix B
Financial Statements 33
LIKE ALL MUTUAL FUNDS, 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.
SUMMARY OF EXPENSES
The purpose of the table below is to assist investors in understanding the
various costs and expenses that an investor in Class B shares would bear
directly or indirectly. The expense summary format below was developed for
use by all mutual funds to help investors make their investment decisions.
T his expense information should be considered along with
other important information such as each Portfolio's investment objective
and its past performance. There are no transaction expenses associated with
purchases, exchanges and redemptions of Class B shares.
A. ANNUAL OPERATING EXPENSES (AS A PERCENTAGE OF AVERAGE NET ASSETS) FOR
CLASS B SHARES OF EACH OF THE PORTFOLIOS:
DOMESTIC
U.S. U.S. U.S. MONEY MONEY
TREASURY TREASURY GOVERNMENT MARKET MARKET
PORTFOLIO PORTFOLIO II PORTFOLIO PORTFOLIO PORTFOLIO
Management Fee .15%* .14%* .14%* .12%* 15%*
12b-1 Fee .32% .32% .25% .32% .32%
Other Expenses .03% .04% .04% .06% .03%
Total Operating
Expenses .50% .50% .43% .50% .50%
* NET OF REIMBURSEMENT
B. EXAMPLE: An investor would pay the following expenses on a $1,000
investment in Class B shares of each Portfolio , assuming (1) a
5% annual return and (2) full redemption at the end of each time
period for U.S. Treasury, U.S. Treasury II, Domestic Money Market
a nd Money Market P ortfolio s :
1 YEAR 3 YEARS 5 YEARS 10 YEARS
$5 $16 $28 $63
for U.S. Government Portfolio:
1 YEAR 3 YEARS 5 YEARS 10 YEARS
$4 $14 $25 $54
EXPLANATION OF TABLE:
A. ANNUAL OPERATING EXPENSES. Management fees are based on the Portfolios'
historical expenses after reimbursement. Management fees are paid by each
Portfolio to Fidelity Management & Research Company ("FMR" or the
"Adviser") for managing its investments and business affairs. 12b-1 Fees
are paid by Class B to Fidelity Distributors Corporation (Distributors) for
services and expenses in connection with the distribution of Class B
shares. Long-term shareholders may pay more than the economic
equivalent of the maximum front-end sales charges permitted by the
N ational Association of Securities Dealers ( NASD) due to
12b-1 fees . The Portfolios incur other expenses for maintaining
shareholder records, furnishing shareholder statements and reports, and
other services. Subject to revision upon 90 days' notice to shareholders,
FMR has agreed to reimburse Class B of each Portfolio if and to the
extent that total operating expenses (excluding interest, taxes, brokerage
commissions, extraordinary expenses, and 12b-1 fees payable by Class B of
each shares) exceed an annual rate of .18% of the average net assets of
the Portfolio's Class A shares . If FMR were not reimbursing Class B
of each Portfolio, the respective Management Fees and Total Operating
Expenses for Class B shares of the Portfolios would be: .20% and
.55% for U.S. Treasury Portfolio; .20% and .56% for U.S. Treasury Portfolio
II; .20% and .49% for U.S. Government Portfolio; .20% and .58% for Domestic
Money Market Portfolio; and .20% and .55% for Money Market Portfolio.
Please refer to the section "Management Contracts, Distribution Plans and
Service Agreements" on page for further information.
B. EXAMPLE OF EXPENSES. The hypothetical example illustrates the expenses
associated with a $1,000 investment i n Class B Shares o ver
periods of 1, 3, 5 and 10 years, based on the expenses in the table and an
assumed annual rate of return of 5%. These figures reflect FMR's voluntary
reimbursement of expenses fo r Class B of each Portfolio. THE RETURN
OF 5% AND EXPENSES SHOULD NOT BE CONSIDERED INDICATIONS OF ACTUAL OR
EXPECTED CLASS B PERFORMANCE OR EXPENSES, BOTH OF WHICH MAY VARY.
FUND SUMMARY
INVESTMENT OBJECTIVE AND POLICIES. Fidelity Institutional Cash Portfolios,
an open-end management investment company, offers institutional and
corporate investors a convenient and economical way to invest in a choice
of five professionally managed money market portfolios. Each Portfolio's
investment objective is to obtain as high a level of current income as
is consistent with the preservation of principal and liquidity within
the limitations prescribed for the Portfolio.
U.S. TREASURY PORTFOLIO AND U.S. TREASURY PORTFOLIO II. Comprised of
obligations which are issued or guaranteed as to principal and interest by
the U.S. government and thus constitute direct obligations of the United
States of America.
U.S. GOVERNMENT PORTFOLIO. Comprised of obligations issued or guaranteed as
to principal and interest by the U.S. government, its agencies or
instrumentalities (U.S. government obligations).
DOMESTIC MONEY MARKET PORTFOLIO. Comprised of highest quality, U.S.
dollar- denominated money market obligations of domestic issuers only.
Under normal conditions , more than 25% of the Portfolio's total
assets will be invested in obligations of companies in the financial
services industry.
MONEY MARKET PORTFOLIO. Comprised of a broad range of high quality ,
U.S. dollar-denominated money market obligations of domestic and foreign
issuers. Under normal conditions more than 25% of the Portfolio's total
assets will be invested in obligations of companies in the financial
services industry.
Each Portfolio may engage in repurchase agreements and reverse repurchase
agreements; however, U.S. Treasury Portfolio II does not currently intend
to engage in reverse repurchase agreements. Domestic Money Market Portfolio
and Money Market Portfolio may purchase restricted securities. Other
permitted investments of these two Portfolios include bankers' acceptances,
certificates of deposit, time deposits and commercial paper. All five
Portfolios may invest in variable rate obligations. See "Investment
Policies, Risks and Limitations," page , for further information on each
Portfolio's permitted investments.
INVESTING IN THE FUND. The Portfolios' Cl a ss B shares may be
purchased at the next determined net asset value per Class B share
(NAV). Each Portfolio requires a minimum initial investment of $5
million. Additional investments may be made in any amount. For
immediate acceptance of purchase orders, federal funds must be transmitted.
See "How to Invest," page .
REDEMPTION OF INVESTMENT. Investors may redeem all or any part of the value
of their accounts by instructing a Portfolio to redeem Class B
shares as described under "How to Redeem" on page . Redemptions may be
requested by telephone and are effected at the NAV next determined after
receipt and acceptance of the request. Amounts will be redeemed by
wire to the investor's designated bank account.
INVESTMENT ADVISER. FM R is the investment adviser to each
Portfol io . FMR, one of the largest investment management
organizations in the United States, serves as investment adviser to
investment companies which had aggregate net assets of more than
$ 225 billion and approximately 15 million shareholder
accounts as of April 30, 1994. FMR has entered into a sub-advisory
agreement with FMR Texas Inc. (FMR Texas), a subsidiary of FMR, pursuant to
which FMR Texas has primary responsibility for providing investment
management services to each Portfolio. See "Management Contracts,
Distribution Plans and Service Agreements," page .
FINANCIAL HIGHLIG H TS
The following tables give information about each Portfolio's financial
history. They use the Portfolios' fiscal year (which ends March 31) and
express the information in terms of a single share outstanding throughout
the periods shown. The per-share data and ratios have been audited by Price
Waterhouse, independent accountants. Their unqualified report is included
on page 57.
U.S. TREASURY PORTFOLIO**
<TABLE>
<CAPTION>
<S>
<C> <C> <C> <C> <C> <C> <C> <C> <C>
Years Ended March 31, November 9,
1985
(Commencement
of Operations) to
March 31,
1994 1993 1992 1991 1990 1989 1988 1987 1986
SELECTED PER-SHARE DATA
Net asset value, beginning
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
of period
Income from Investment
.030 .035 .053 .076 .088 .079 .065 .062 .030
Operations Net interest
income
Less Distributions
(.030) (.035) (.053) (.076) (.088) (.079) (.065) (.062) (.030)
From net interest income
Net asset value, end of period
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN (dagger)
3.08% 3.51% 5.48% 7.89% 9.15% 8.17% 6.65% 6.36% 3.02%
RATIOS AND SUPPLEMENTAL
DATA
Net assets, end of period (000
$ 1,611,877 $ 2,036,806 $ 2,629,072 $ 1,782,957 $ 1,721,126 $ 1,179,620 $ 650,114 $ 637,115 $ 239,945
omitted)
Ratio of expenses to average
.18% .18% .18% .18% .20% .20% .20% .20% .20%*
net assets (dagger)(dagger)
Ratio of expenses to average
.23% .23% .25% .24% .25% .26% .23% .25% .34%*
net assets before expense
reductions (dagger)(dagger)
Ratio of net interest income
3.03% 3.46% 5.29% 7.57% 8.72% 8.06% 6.45% 6.13% 7.56%*
to
average net assets
</TABLE>
* ANNUALIZED
** AS OF MARCH 31, 1994, CLASS B SHARES FOR U.S. TREASURY PORTFOLIO, U.S.
GOVERNMENT PORTFOLIO, AND DOMESTIC MONEY MARKET PORTFOLIO WERE NOT
OPERATIONAL.
(dagger) TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT
ANNUALIZED AND WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
(dagger)(dagger) SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS.
<TABLE>
<CAPTION>
<S>
<C> <C> <C> <C> <C> <C> <C> <C>
U.S. TREASURY PORTFOLIO II - CLASS A February 2, 1987
(Commencement
Years Ended March 31, of
Operations) to
March 31,
1994 1993 1992 1991 1990 1989 1988 1987
SELECTED PER-SHARE DATA
Net asset value, beginning of
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
period
Income from
Investment Operations
Net interest income
.030 .034 .053 .076 .088 .078 .064 .009
Less Distributions
From net interest income
(.030) (.034) (.053) (.076) (.088) (.078) (.064) (.009)
Net asset value, end of period
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN (dagger)
3.06% 3.46% 5.41% 7.87% 9.13% 8.11% 6.60% .93%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period
$ 4,551,918 $ 5,589,663 $ 5,476,852 $ 3,281,686 $ 1,481,324 $ 658,068 $ 379,501 $ 26,314
(000 omitted)
Ratio of expenses to average
.18% .18% .18% .18% .19% .20% .20% .20%*
net assets (dagger)(dagger)
Ratio of expenses to average net
.24% .23% .25% .25% .27% .26% .32% .99%*
assets before expense
reductions (dagger)(dagger)
Ratio of net interest income to
3.01% 3.38% 5.12% 7.50% 8.63% 7.92% 6.46% 6.11%*
average net assets
</TABLE>
* ANNUALIZED
(dagger) TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT
ANNUALIZED AND WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
(dagger)(dagger) SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS.
U.S. TREASURY PORTFOLIO II - CLASS B
<TABLE>
<CAPTION>
<S> <C>
October 22,
1993
(Commencement
of
Operations) to
March 31, 1994
SELECTED PER-SHARE DATA
Net asset value, beginning of period $ 1.000
Income from Investment Operations
Net interest income .012
Less Distributions
From net interest income (.012)
Net asset value, end of period $ 1.000
TOTAL RETURN (dagger) 1.21%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted) $ 5,175
Ratio of expenses to average net assets (dagger)(dagger) .50%*
Ratio of expenses to average net assets before expense reductions (dagger)(dagger) .56%*
Ratio of net interest income to average net assets 2.69%*
</TABLE>
* ANNUALIZED
(dagger) TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT
ANNUALIZED AND WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED
DURING THE PERIOD SHOWN.
(dagger)(dagger) SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS.
<TABLE>
<CAPTION>
<S>
<C> <C> <C> <C> <C> <C> <C> <C> <C>
U.S. GOVERNMENT PORTFOLIO** July 25, 1985
(Commencement
Years Ended March 31, of
Operations) to
March 31,
1994 1993 1992 1991 1990 1989 1988 1987 1986
SELECTED PER-SHARE DATA
Net asset value, beginning of
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
period
Income from Investment
.031 .035 .054 .077 .088 .079 .068 .063 .053
Operations
Net interest income
Less Distributions
(.031) (.035) (.054) (.077) (.088) (.079) (.068) (.063) (.053)
From net interest income
Net asset value, end of period
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN (dagger)
3.13 3.56 5.55 7.94 9.15 8.19 6.98 6.51 5.47%
% % % % % % % %
RATIOS AND SUPPLEMENTAL
DATA
Net assets, end of period (000
$ 3,764,544 $ 5,686,166 $ 4,603,781 $ 3,613,838 $ 2,815,622 $ 1,918,342 $ 1,878,786 $ 1,358,659 $ 511,720
omitted)
Ratio of expenses to average
.18 .18 .18 .18 .20 .20 .20 .20 .20%*
net
% % % % % % % %
assets (dagger)(dagger)
Ratio of expenses to average
.24 .24 .25 .25 .25 .24 .23 .25 .30%*
net assets before expense
% % % % % % % %
reductions (dagger)(dagger)
Ratio of net interest income to
3.07 3.50 5.33 7.62 8.74 7.90 6.78 6.28 7.81%*
average net assets
% % % % % % % %
</TABLE>
* ANNUALIZED
** AS OF MARCH 31, 1994, CLASS B SHARES FOR U.S. TREASURY PORTFOLIO, U.S.
GOVERNMENT PORTFOLIO, AND DOMESTIC MONEY MARKET PORTFOLIO WERE NOT
OPERATIONAL.
(dagger) TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT
ANNUALIZED AND WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
(dagger)(dagger) SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS.
<TABLE>
<CAPTION>
<S>
<C> <C> <C> <C> <C>
DOMESTIC MONEY MARKET PORTFOLIO**
Years Ended March 31 November 3,
1989
(Commencement
of
Operations) to
March 31,
1994 1993 1992 1991 1990
SELECTED PER-SHARE DATA
Net asset value, beginning of period
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
Income from Investment Operations
.031 .034 .054 .078 .035
Net interest income
Less Distributions
(.031) (.034) (.054) (.078) (.035)
From net interest income
Net asset value, end of period
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN (dagger)
3.14% 3.50% 5.50% 8.11% 3.52%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted)
$ 656,976 $ 804,354 $ 558,727 $ 355,369 $ 330,974
Ratio of expenses to average net assets (dagger)(dagger)
.18% .18% .18% .18% .06%*
Ratio of expenses to average net assets before expense reductions (dagger)(dagger)
.26% .26% .29% .30% .43%*
Ratio of net interest income to average net assets
3.09% 3.43% 5.24% 7.79% 8.44%*
</TABLE>
* ANNUALIZED
** AS OF MARCH 31, 1994, CLASS B SHARES FOR U.S. TREASURY PORTFOLIO, U.S.
GOVERNMENT PORTFOLIO, AND DOMESTIC MONEY MARKET PORTFOLIO WERE NOT
OPERATIONAL.
(dagger) TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT
ANNUALIZED AND WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
(dagger)(dagger) SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS.
<TABLE>
<CAPTION>
<S>
<C> <C> <C> <C> <C> <C> <C> <C> <C>
MONEY MARKET PORTFOLIO - CLASS A July 5, 1985
(Commencemen
Years Ended March 31, t of
Operations) to
March 31,
1994 1993 1992 1991 1990 1989 1988 1987 1986
SELECTED PER-SHARE DATA
Net asset value, beginning of
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
period
Income from Investment
Operations
Net interest income
.032 .035 .055 .078 .089 .080 .069 .064 .059
Less Distributions
From net interest income
(.032) (.035) (.055) (.078) (.089) (.080) (.069) (.064) (.059)
Net asset value, end of period
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN (dagger)
3.20 3.58 5.59 8.13 9.25 8.35 7.14 6.57 6.01%
% % % % % % % %
RATIOS AND SUPPLEMENTAL
DATA
Net assets, end of period (000
$ 3,200,277 $ 4,332,995 $ 3,990,395 $ 4,706,936 $ 4,127,879 $ 2,627,450 $ 2,524,767 $ 1,569,199 $ 960,784
omitted)
Ratio of expenses to average
.18 .18 .18 .18 .20 .20 .20 .20 .19%*
net
% % % % % % % %
assets (dagger)(dagger)
Ratio of expenses to average
.23 .23 .24 .25 .24 .24 .23 .23 .28%*
net assets before
% % % % % % % %
expense reductions (dagger)(dagger)
Ratio of net interest income to
3.15 3.50 5.42 7.80 8.82 8.11 6.95 6.33 7.97%*
average net assets
% % % % % % % %
</TABLE>
* ANNUALIZED
(dagger) TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT
ANNUALIZED AND WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
(dagger)(dagger) SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS.
MONEY MARKET PORTFOLIO - CLASS B
<TABLE>
<CAPTION>
<S> <C>
November 17,
1993
(Commencement
of
Operations) to
March 31, 1994
SELECTED PER-SHARE DATA
Net asset value, beginning of period $ 1.000
Income from Investment Operations
Net interest income .011
Less Distributions
From net interest income (.011)
Net asset value, end of period $ 1.000
TOTAL RETURN (dagger) 1.08%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted) $ 89,463
Ratio of expenses to average net assets (dagger)(dagger) .50%*
Ratio of expenses to average net assets before expense reductions (dagger)(dagger) .55%*
Ratio of net interest income to average net assets 2.83%*
</TABLE>
* ANNUALIZED
(dagger) TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT
ANNUALIZED AND WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED
DURING THE PERIOD SHOWN.
(dagger)(dagger) SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS.
INVESTMENT O BJECTIVE
The investment objective of each Portfolio is to obtain as high a level of
current income as is consistent with the preservation of principal and
liquidity within the standards prescribed for the Portfolio. There is no
assurance that a Portfolio will achieve its investment objective.
INVESTMENT POL I CIES, RISKS AND LIMITATIONS
The Fund consists of five individual Portfolios, differentiated in terms of
their permitted investments or investment techniques. Each Portfolio seeks
to maintain a $1.00 share price at all times. The permitted investments of
the Portfolios are as follows:
U.S. TREASURY PORTFOLIO (TREASURY PORTFOLIO) currently maintains
an operating policy of investing at least 65% of its total assets in U.S.
Treasury bills, notes and bonds and repurchase agreements backed by those
obligations. The balance of its assets may be invested in other direct
obligations of the United States.
U.S. TREASURY PORTFOLIO II (TREASURY PORTFOLIO II) currently
maintains an operating policy of investing 100% of its total assets in U.S.
Treasury bills, notes and bonds and other direct obligations of the U.S.
Treasury. The Portfolio may also engage in repurchase agreements backed by
those obligations.
(bullet) Each of the above operating policies for Treasury Portfolio and
Treasury Portfolio II may be changed upon 90 days' notice to
shareholders. In the case of such notification, each Portfolio would be
permitted to invest in instruments which are issued or guaranteed as to
principal and interest by the U.S. government and thus constitute direct
obligations of the United States. D irect U.S. government
obligations include such instruments as U.S. Treasury bills, notes and
bonds and instruments issued by such Federal agencies as the Export-Import
Bank of the U nited States, the General Services Administration, the
Government National Mortgage Association, the Small Business Administration
and the Washington Metropolitan Area Transit Authority. The Portfolios will
not invest in securities issued or guaranteed by U.S. government agencies,
instrumentalities, or government-sponsored enterprises that are not backed
by the full faith and credit of the United States.
U.S. GOVERNMENT PORTFOLIO (GOVERNMENT PORTFOLIO) invests in U.S. government
obligations, issued or guaranteed as to principal and interest by the U.S.
government, including bills, notes, bonds and other U.S. Treasury debt
securities; and instruments issued by U.S. government instrumentalities or
agencies(agency obligations). These instruments include:
(bullet) obligations of the Federal Home Loan Banks, Federal Farm Credit
Banks, and Federal National Mortgage Association, which are backed only by
the right of the issuer to borrow from the U.S. Treasury under certain
circumstances or are backed by the credit of the agency or instrumentality
issuing the obligation. Such agency obligations are not deemed direct
obligations of the United States, and therefore involve more risk.
DOMESTIC MONEY MARKET PORTFOLIO (DOMESTIC PORTFOLIO) invests in U.S.
dollar-denominated money market instruments of domestic issuers rated in
the highest rating category by at least two nationally recognized rating
services, or by one if only one rating service has rated an obligation. The
Portfolio may purchase unrated obligations determined to be of equivalent
quality pursuant to procedures adopted by the Board of Trustees. The
Portfolio's investments include:
(bullet) obligations of companies in the financial services industry,
including domestic banks, savings and loan associations, consumer and
industrial finance companies, securities brokerage companies and a variety
of firms in the insurance field. (These obligations include time deposits,
certificates of deposit, bankers' acceptances and commercial paper.) Under
normal conditions, the Portfolio will invest more than 25% of its total
assets in obligations of companies in the financial services
industry ;
(bullet) obligations of governments and their agencies and
instrumentalities ;
(bullet) short-term corporate obligations, including commercial paper,
notes and bonds; a nd
(bullet) other short-term debt obligations.
MONEY MARKET PORTFOLIO invests in high quality, U.S. dollar-denominated
money market instruments of domestic and foreign issuers, such as:
(bullet) obligations of companies in the financial services industry,
including obligations of U.S. branches of both foreign and domestic banks,
savings and loan associations, consumer and industrial finance companies,
securities brokerage companies and a variety of firms in the insurance
field. (These obligations include time deposits, certificates of deposit,
bankers' acceptances and commercial paper.) Under normal conditions, the
Portfolio will invest more than 25% of its total assets in obligations of
companies in the financial services industry ;
(bullet) obligations of governments and their agencies and
instrumentalities ;
(bullet) short-term corporate obligations, including commercial paper,
notes and bonds ; and
(bullet) other short-term debt obligations.
To the extent that either Domestic Portfolio or Money Market Portfolio
invests more than 25% of its assets in obligations of companies in the
financial services industry, it will be exposed to the greater risks
associated with that industry as a whole. Domestic Portfolio and Money
Market Portfolio may invest in restricted securities. In addition, Money
Market Portfolio may invest in obligations of U.S. banks, foreign branches
of U.S. and foreign banks (Eurodollars), and U.S. branches and
agencies of foreign banks (Yankee dollars). Eurodollar and Yankee dollar
investments involve risks that are different from investments in securities
of U.S. banks. (See Appen dix A.)
REGULATORY REQUIREMENTS. The following is a brief summary of regulatory
requirements applicable to all money market funds which limit certain of
the Portfolios' investment policies, though some of the Portfolios may
follow more restrictive policies as described above.
(bullet) QUALITY. Pursuant to procedures adopted by the Board of Trustees,
each Portfolio may purchase only high quality securities that FMR believes
present minimal credit risks. To be considered high quality, a security
must be: a U.S. government security; rated in accordance with applicable
rules in one of the two highest categories for short-term securities by at
least two nationally recognized rating services (or by one, if only one
rating service has rated the security); or, if unrated, judged to be of
equivalent quality by FMR.
High quality securities are divided into "first tier" and "second
tier" securities. First tier securities have received the highest rating
(e.g., S&P A-1 rating) from at least two rating services (or one, if
only one has rated the security). Second tier securities have received
ratings within the two highest categories (e.g., S&P A-1 or A-2) from
at least two rating services (or one, if only one has rated the security),
but do not qualify as first tier securities. If a security has been
assigned different ratings by different rating services, at least two
rating services must have assigned the higher rating in order for FMR to
determine eligibility on the basis of that higher rating. Based on
procedures adopted by the Board of Trustees, FMR may determine that an
unrated security is of equivalent quality to a security rated first or
second tier.
Money Market Portfolio may not invest more than 5% of its total
assets in second tier securities. In addition, Money Market Portfolio may
not invest more than 1% of its total assets or $1 million (whichever is
greater) in the second tier securities of a single issuer.
(bullet) MATURITY. Each Portfolio must limit its investments to securities
with remaining maturities of 397 days or less and must maintain a
dollar-weighted average maturity of 90 days or less.
(bullet) DIVERSIFICATION. Neither Domestic Money Market
Portfolio , n o r Money Market Portfolio may invest
more than 5% of its total assets in the securities (other than U.S.
government securities) of any single issuer. Under certain conditions,
however, each Portfolio may invest up to 10% of its total assets in the
first tier securities of a single issuer for up to three days.
INVESTMENT TECHNIQUES. Each Portfolio may engage in repurchase agreements
with respect to any ca t egory of securities in which it is
entitle d to invest, even if the maturity of these securities
is greater than 3 9 7 days. Each Portfolio, except Treasury Portfolio
II, also may engage in reverse repurchase agreements to raise cash
temporarily or to attempt to increase income. Shareholders of Treasury
Portfolio II will be notified should the Portfolio change its policies
concerning reverse repurchase agreements.
See Appendix A on page for further information on the
Portfolios' investment techniques, including repurchase and reverse
repurchase agreements, and Appendix B on page for a description of
rating categories.
The investment objective and policies set forth above are supplemented by
each P ortfolio's investment limitations beginning below . Each
Portfolio's objective is fundamental; however, its investment policies and
limitations, unless otherwise indicated, are not fundamental, and may be
changed without shareholder approval.
SUITABILITY
The Fund is designed as an economical and convenient vehicle for those
institutional and corporate investors with cash balances or cash reserves
seeking to obtain the yields available from money market instruments while
maintaining liquidity. The ability to select from among the Portfolios
allows investors to choose that Portfolio, or combination of Portfolios,
which best suits their particular investment goals.
Each Portfolio's ability to achieve its investment objective depends on the
quality and maturity of its investments. Although the Portfolios'
investment policies are designed to maintain a stable $1.00 share
price, all money market instruments can change in value when interest rates
or issuers' creditworthiness change, or if an issuer or a guarantor of a
security fails to pay interest or principal when due. If these changes in
value were large enough, a Portfolio's share price could fall below $1.00.
In general, securities with longer maturities are more vulnerable to price
changes, although they may provide higher yields.
The Portfolios offer the advantages of large purchasing power and
diversification. Generally, in purchasing money market instruments from
dealers, the percentage difference between the bid and asked prices tends
to decrease as the size of the transaction increases. The Portfolios
also offer investors the opportunity to participate in a portfolio of money
market instruments which is more diversified in terms of issuers and
maturities than the size the investor's investment might otherwise permit.
Investment in a Portfolio relieves the investor of many
management and administrative burdens usually associated with the direct
purchase and sale of money market instruments. These include selection of
portfolio investments; surveying the market for the best terms at which to
buy and sell; scheduling and monitoring maturities and reinvestments;
receipt, delivery and safekeeping of securities; and portfolio
recordkeeping.
INVESTMENT LIMITATIONS
Unless otherwise noted, whenever an investment policy or limitation
states a maximum percentage of a Portfolio's assets that may be invested in
any security or other asset or sets forth a policy regarding quality
standards, such standard or percentage limitation shall be determined
immediately after and as a result of a Portfolio's acquisition of such
security or other asset. Accordingly, any subsequent change in values, net
assets or other circumstances will not be considered when determining
whether the investment complies with a Portfolio's investment policies and
limitations.
The Portfolios' fundamental investment policies and limitations may not
be changed without approval by a "majority of the outstanding voting
securities" (as defined in the Investment Company Act of 1940) of the
Portfolios. However, except for the fundamental investment limitations set
forth below, the investment policies and limitations described in this
combined Prospectus and Statement of Additional Information are not
fundamental and may be changed without shareholder approval. THE
FOLLOWING ARE THE PORTFOLIOS' FUNDAMENTAL INVESTMENT LIMITATIONS SET FORTH
IN THEIR ENTIRETY. EACH PORTFOLIO MAY NOT:
(1) purchase the securities of any issuer (other than obligations issued
or guaranteed as to principal and interest by the government of the United
States, its agencies or instrumentalities) if, as a result, more than 5% of
its total assets would be invested in the securities of such issuer,
provided, however, that with respect to 25% of its total assets, 10% of its
assets may be invested in the securities of an issuer;
(2) issue senior securities, except as permitted under the Investment
Company Act of 1940;
(3) borrow money, except that the Portfolio may (i) borrow money for
temporary or emergency purposes (not for leveraging or investment) and (ii)
engage in reverse repurchase agreements for any purpose; provided that (i)
and (ii) in combination do not exceed 33 1/3% of the value of the
Portfolio's total assets (including the amount borrowed) less liabilities
(other than borrowings). Any borrowings that come to exceed this amount
will be reduced within three days (not including Sundays and holidays) to
the extent necessary to comply with the 33 1/3% limitation;
(4) underwrite securities issued by others, except to the extent that
the Portfolio may be considered an underwriter within the meaning of the
Securities Act of 1933 in the disposition of restricted securities;
(5) purchase the securities of any issuer (other than securities issued
or guaranteed by the U.S. government or any of its agencies or
instrumentalities) if, as a result, more than 25% of the Portfolio's total
assets would be invested in the securities of companies whose principal
business activities are in the same industry, except that Domestic
Portfolio and Money Market Portfolio will invest more than 25% of its total
assets in the financial services industry;
(6) buy or sell real estate;
(7) lend any security or make any other loan if, as a result, more than
33 1/3% of its total assets would be lent to other parties, but this
limitation does not apply to purchases of debt securities or to repurchase
agreements;
(8) invest in oil, gas, or other mineral exploration or development
programs; or
(9) invest in companies for the purpose of exercising control or
management.
(10) Each Portfolio may, notwithstanding any other fundamental
investment policy or limitation, invest all of its assets in the securities
of a single open-end management investment company with substantially the
same fundamental investment objectives, policies and limitations as the
Portfolio.
THE FOLLOWING LIMITATIONS ARE NOT FUNDAMENTAL, AND MAY BE CHANGED
WITHOUT SHAREHOLDER APPROVAL:
(i) Domestic Portfolio and Money Market Portfolio each do not currently
intend to purchase a security (other than a security issued or guaranteed
by the U.S. government or any of its agencies or instrumentalities) if, as
a result, more than 5% of its total assets would be invested in the
securities of a single issuer; provided that the Portfolio may invest up to
10% of its total assets in the first tier securities of a single issuer for
up to three business days.
(ii) Each Portfolio does not currently intend to sell securities short,
unless it owns or has the right to obtain securities equivalent in kind and
amount to the securities sold short, and provided that transactions in
futures contracts and options are not deemed to constitute selling
securities short.
(iii) Each Portfolio does not currently intend to purchase securities on
margin, except that the Portfolio may obtain such short-term credits as are
necessary for the clearance of transactions, and provided that margin
payments in connection with futures contracts and options on futures
contracts shall not constitute purchasing securities on margin.
(iv) Each Portfolio may borrow money only (a) from a bank or from a
registered investment company or portfolio for which FMR or an affiliate
serves as investment adviser or (b) by engaging in reverse repurchase
agreements with any party. Each Portfolio will not purchase any security
while borrowings (excluding reverse repurchase agreements) representing
more than 5% of its total assets are outstanding. Each Portfolio will not
borrow from other funds advised by FMR or its affiliates if total
outstanding borrowings immediately after such borrowing would exceed 15% of
the Portfolio's total assets. Treasury Portfolio II does not currently
intend to engage in reverse repurchase agreements.
(v) Each Portfolio does not currently intend to purchase any security
if, as a result, more than 10% of its net assets would be invested in
securities that are deemed to be illiquid because they are subject to legal
or contractual restrictions on resale or because they cannot be sold or
disposed of in the ordinary course of business at approximately the prices
at which they are valued.
(vi) Subject to 60 days' notification to its shareholders, each
Portfolio does not currently intend to purchase or sell futures contracts
or call options. This limitation does not apply to options attached to, or
acquired or traded together with, their underlying securities and does not
apply to securities that incorporate features similar to options or futures
contracts.
(vii) Domestic Portfolio and Money Market Portfolio do not currently
intend to lend assets other than securities to other parties, except by
lending money (up to 10% of each Portfolio's net assets) to a registered
investment company or portfolio for which FMR or an affiliate serves as
investment adviser. (This limitation does not apply to purchases of debt
securities or to repurchase agreements.)
(viii) Each Portfolio does not currently intend to (a) purchase
securities of other investment companies, except in the open market where
no commission except the ordinary broker's commission is paid, or (b)
purchase or retain securities issued by other open-end investment
companies. Limitations (a) and (b) do not apply to securities received as
dividends, through offers of exchange, or as a result of a reorganization,
consolidation, or merger.
(ix) Treasury Portfolio, Treasury Portfolio II and Government Portfolio
do not currently intend to make loans, but this limitation does not apply
to purchases of debt securities or to repurchase agreements.
(x) Each Portfolio does not currently intend to invest in securities of
real estate investment trusts that are not readily marketable, or to invest
in securities of real estate limited partnerships that are not listed on
the New York Stock Exchange or the American Stock Exchange or traded on the
NASDAQ National Market System.
(xi) Each Portfolio does not currently intend to purchase the securities
of any issuer if those officers and Trustees of the Fund and those officers
and directors of FMR who individually own more than 1/2 of 1% of the
securities of such issuer together own more than 5% of such issuer's
securities.
(xii) Each Portfolio does not currently intend to invest in oil, gas, or
other mineral exploration or development programs or leases.
(xiii) Each Portfolio does not currently intend to invest all of its
assets in the securities of a single open-end management investment company
with substantially the same fundamental investment objectives, policies,
and limitations as the Portfolio.
HOW TO INVEST, EXCHANGE AND REDEEM
Class B s hares of each Portfolio are offered continuously and may be
purchased at the NAV next determined after an order is received and
accepted. T he Portfolios to not impose any sales charges in
connection with purchases of their Class B shares, although institutions
may charge their clients fees in connection with purchases and sales for
the accounts of their clients. Investments in the Portfolios must be made
using the Federal Reserve Wire System. Checks will not be accepted as a
means of investment.
SHARE PRICE AND DIVIDENDS. The NAV f or Class B shares of Treasury
Portfolio , Government P ortfolio , Domestic Money Market
Portfolio , and Money Ma r ket Portfolio determined by Fidelity
Service Co. (Service) , 82 Devonshire Street, Boston, MA 02109 as of
3:00 p.m. Eastern time, each day the Portfolios are open for business. (See
"Holiday Schedule" on page .) The NAV for Class B shares of T reasury
Portfolio II will be determine d at 3:00 p.m. and 5:00
p .m. Eastern time. Shareholders of record as of 3:00 p.m. (5:00
p.m. for Treasury Portfolio II) will be entitled to that day's dividend.
The NAV is determined by adding the value of all securities and other
assets of Class B of the Portfolio, deducting the actual and accrued
liabilities allocated to Class B shares, and dividing by the number of
Class B shares outstanding. (See "How Net Asset Value is Determined" on
page .)
Class B's net interest income for dividend purposes is
deter m ined by Service on a daily basis and shall be declared to
s h areholders of record at the time of its declaration
(includin g , for this purpose, holders of shares purchased, but
excluding holders of shares redeemed on that day). The dividend
declared f or Treasury Portfolio II is based on estimates of net
interest i ncome for the Portfolio. Actual income may differ from
e s timates and differences, if any, will be included in the
calculation of subsequent dividends . Income dividends declared
are accrued daily throughout the month and are distributed in the form
of full and fractiona l Class B shares on the first business day of
the f ollowing month. Based on prior approval of the Fund, dividends
relating to Class B shares redeemed during the month can be distributed in
the form of full and fractional Class B s hares on the day of
redemption. The Fund reserves the right to limit this service. The
shareholder may elect to receive monthly dividends in cash.
MINIMUM INVESTMENT AND ACCOUNT BALANCE. The minimum initial investment to
establish a new account i n Class B shares of each Portfolio is $5
mill i on. Subsequent investments may be made in any amount. To keep
an account open, please leave $5 million in i t. If an account
balance falls below $5 million due to redemption, the account may be closed
and the proceeds wired to the bank account of record. An investor will be
given 30 days' notice that the account will be closed unless an additional
investment is made to increase the account balance to the $5 million
m inimum.
HOW TO INVEST. An initial investment in Class B of a Portfolio must
be preceded or accompanied by a completed, signed application. Unless you
already have a Fidelity mutual fund account, you must complete and sign the
application. The application should be forwarded to:
Fidelity Client Services
c/o Fidelity Institutional Cash Portfolios
FIIOC, ZR5
P.O. Box 1182
Boston, MA 02103-1182
An invest o r must purchase Class B shares of each Portfolio by wire.
For wiring information and instructions, investors should call the
institution through which they trade or Fidelity Client Services. There is
no charge imposed by the Fund for the wire; however, banks may charge a fee
for this service.
In order to receive same day acceptance of the investment, investors must
telephone Institutional Trading before 3:00 p.m., Eastern time, on days the
Portfolios are open for business, to advise them of the wire and to place
the trade.
In order to receive same day acceptance of investment in Treasury
Portfolio II after 3:00 p.m., investors must telephone Institutional
Trading before 5:00 p.m. Eastern time to place the trade and must obtain a
wire reference number for each trade. It is necessary to obtain a new wire
reference number for each purchase placed in the Portfolio after 3:00 p.m.
Eastern time. Wire reference numbers are assigned exclusively by means of
telephone communication and are effective for one transaction only and may
not be used more than once. WIRED MONEY FOR PURCHASES PLACED AFTER
3:00 P.M. THAT IS NOT PROPERLY IDENTIFIED WITH A CURRENTLY EFFECTIVE WIRE
REFERENCE NUMBER WILL BE RETURNED TO THE BANK FROM WHICH IT WAS WIRED AND
WILL NOT BE CREDITED TO THE SHAREHOLDER'S ACCOUNT.
FIDELITY CLIENT SERVICES:
NATIONWIDE 800-843-3001
INSTITUTIONAL TRADING:
NATIONWIDE 800-343-6310
IN MASSACHUSETTS 800-462-2603
Investors will be entitled to the dividend declared on C lass B
shares by a Portfolio provided the Portfolio's custodian bank receives the
wire by the close of the Federal Reserve Wire System on the day the
purchase order is accepted. Investors are advised to wire funds as early in
the day as possible, and to provide advance notice to Institutional Trading
for large transactions.
HOW TO EXCHANGE. Each Portfolio's Class B shares may be exchanged
(subject to the minimum initial investment requirement) at no charge for
Class B shares of any other Portfolio of the Fund, provided the portfolio
to be acquired is registered in an investor's state. In vestors whose
orders to exchange out of Trea s ury Portfolio II are received between
3:00 and 5:00 p.m. may not b e invested for one day, depending
on the time at which orders a r e accepted by the p ortfolio
into which they are exchanging. You may only exchange between
accounts that are registered in the same name, address, and taxpayer
identification number. Exchanges will not be permitted until a completed
and signed mutual fund application is on file. Investors should consult the
prospectus of the portfolio to be acquired to determine eligibility and
suitability.
TO EXCHANGE BY TELEPHONE. Exchanges may be requested on any day the
Portfolios are open for business by calling Institutional Trading before
3:00 p.m. Eastern tim e (5:00 p.m. for Treasury Portfolio II) at the
numbers listed above .
TO EXCHANGE BY MAIL. Written requests for exchanges should contain the
Portfolio name, account number, and number of Class B s h ares to be
redeemed, and the name of the portfolio to be purchased. The letter
must be signed by a person authorized to act on the account and must
include a signature guarantee. Signature guarantees will be accepted from
banks, brokers, dealers, municipal securities dealers, municipal securities
brokers, government securities dealers, government securities brokers,
credit unions (if authorized under state law), national securities
associations, clearing agencies and savings associations. Letters should be
sent to Fidelity Client Services at the address shown above.
An exchange involves the redemption of all or a portion of the shares of
one portfolio and the purchase of shares of another portfolio.
Class B shares will be redeemed at the next determined NAV following
receipt of the exchange order. S hares of the portfolio to be
acquired will be purchased a t their next determined NAV after
redemption proceeds are made available. Investors will earn dividends in
the acquired portfolio in accordance with the portfolio's customary policy,
normally on the day the exchange request is received. Investors should note
that under certain circumstances, a Portfolio may take up to seven days to
make redemption proceeds available for the exchange purchase of another
p ortfolio.
Pursuant to Rule 11a-3 un der the 1940 Act, each Portfolio is
required to give shareholders at least 60 days' notice prior to terminating
or modifying a Portfolio's exchange privilege. Under Rule 11a-3, the 60-day
notification requirement may be waived if (i) the only effect of a
modification would be to reduce or eliminate an administrative fee,
redemption fee or deferred sales charge ordinarily payable at the time of
exchange, or (ii) a p ortfolio suspends the redemption of the shares
to be exchanged as permitted under the 1940 Act orthe rules and
regulations thereunder,or the p ortfolio to be acquired suspends sale
of its shares because it is unable to invest amounts effectively in
accordance with its investment objective and policies.
E ach Portfolio reserves the right at any time without prior notice
to refuse exchange purchases by any person or group, if, in FMR's judgment,
the Portfolio would be unable to invest effectively in accordance with its
investment objective and policies or might otherwise be adversely affected.
The exchange privilege may be modified or terminated in the future.
HOW TO REDEEM. Shareholders may redeem all or any part of the value of
their account(s) on any business day. Redemptions may be requested by
telephone and are effected at the NAV next determined after receipt of the
redemption request.
Shareholders must designate on their applications their U.S. commercial
bank account(s) into which they wish the proceeds of redemptions to be
deposited. A shareholder may change the bank account(s) designated to
receive amounts redeemed at any time prior to making a redemption request.
A letter of instruction, including a signature guarantee, should be sent to
Fidelity Client Services at th e address shown above .
Redemption proceeds will be wired via the Federal Reserve Wire System to a
bank account of record on the same day a redemption request is received,
provided it is made before 3:00 p.m. Eastern time. In the case of Treasury
Portfolio II, redemption proceeds will be wired via the Federal Reserve
Wire System to a bank account of record on the same day a redemption
request is received, provided it is received before 5:00 p.m. Eastern time.
Class B Shar e s redeemed will not receive the dividend declared on
the day of redemption. Redemption requests can be made by calling
Institutional Trading . There is no charge imposed for wiring of
redemption proceeds .
If Class B shares redeemed represent an investment made via clearing
house funds, each Portfolio reserves the right to withhold the redemption
proceeds until it is reasonably assured of the crediting of such funds to
its account.
Under the 1940 Act, the right of redemption may be suspended or the date of
payment postponed for more than seven days at times when the New York Stock
Exchange (NYSE) is closed, other than customary weekend or holiday
closings, or when trading on the NYSE is restricted, or under certain
emergency circumstances as determined by the S ecurities and Exchange
Commission (SEC). If investors are unable to execute a transaction
by telephone (for example, during time of unusual market activity) they may
consider placing their orders by mail. In case of the suspension of the
right of redemption, investors may either withdraw their requests for
redemption or receive payment based on the NAV next determined after
termination of the suspension.
ADDITIONAL INFORMATION. Investors may initiate many transactions by
telephone. Note that Fidelity will not be responsible for any losses
resulting from unauthorized transactions if it follows reasonable
procedures designed to verify the identity of the caller. Fidelity will
requ e st personal information for security purposes, and may also
record calls. Investors should verify the accuracy of their
confirmation statements immediately after receiving them. Invest o rs
that do not want the ability to redeem and exchange by telep h one
should call Fidelity for instructions.
To allow the Adviser to manage the Portfolios most effectively, investors
are strongly urged to initiate all trades (investments in , or
exchanges or redemptions of Class B shares) as early in the day as
possible and to notify Fidelity Client Services at least one day in advance
of transactions in excess of $5 million. In making these trade requests,
the name of the registered shareholder and the account number must be
supplied for each transaction. To protect each Portfolio's performance and
shareholders, the Adviser discourages frequent trading in response to
short-term market fluctuations.
In order to invest or redeem from Treasury Portfolio II after 3:00 p.m.,
investors must contact their client service representative one week in
advance to establish the requisite operational requirements for late
trading. Even after these procedures are in place, investors are encouraged
to execute as many trades as possible prior to 3:00 p.m. The Portfolio
reserves the right to refuse any investment that would, in its sole
discretion, be disruptive of the Portfolio's management.
If the Trustees determine that existing conditions make cash payments
undesirable, redemption payments may be made in whole or in part in
securities or other property, valued for this purpose as they are valued in
computing the NAV for each Portfolio's Class B shares .
Shareholders receiving securities or other property on redemption may
realize a gain or loss for tax purposes, and will incur any costs of sale,
as well as the associated inconveniences.
Each Portfolio reserves the right to suspend the offering of Class B
s h ares for a period of time, and each Portfolio reserves the right
to reject any specific purchase order including certain purchases by
exchange. Purchase orders may be refused if, in FMR's opinion, they are of
a size that would disrupt management of the Portfolios. Each Portfolio may
discontinue offering its shares at any time or in any particular state
without notice to shareholders.
INVESTOR ACCOUNTS. Fidelity Investments Institutional Operations Company
(FIIOC) is the transfer, dividend disbursing and shareholder servicing
agent for the Fund and maintains an account for each investor expressed in
terms of full and fractional Class B shares of each Portfolio rounded to
the nearest 1/1000th of a share.
The Fund does not issue share certificates, but FIIOC will send investors a
confirmation statement after every transaction (except a reinvestment of
dividends or capital gains) that affects the Class B share balance
or the account registration. After the end of each month, FIIOC will send
each investor a statement setting forth the transactions in their account
for the month and the month-end balance of full and fractional Class B
s hares held in the account.
SUBACCOUNTING AND SPECIAL SERVICES. Special processing has been arranged
with FIIOC for banks, corporations and other institutions that wish to open
multiple accounts (a master account and subaccounts). An investor wishing
to utilize FIIOC's subaccounting facilities or other special services for
individual or multiple accounts will be required to enter into a separate
agreement with FIIOC. Charges for these services, if any, will be
determined on the basis of the level of services to be rendered.
Subaccounts may be opened with the initial investment or at a later date.
HOLIDAY SCHEDULE. Each Portfolio is open for business and its Class
B NAV is calculated each day that both the Federal Reserve Bank of
New York ( New York Fed) and the NYSE are open for trading.
The following holiday closings have been scheduled for 1994: Dr. Martin
Luther King, Jr. Day (observed), Presidents' Day, Good Friday, Memorial
Day, Independence Day (observed), Labor Day, Columbus Day, Veterans' Day,
Thanksgiving Day and Christmas Day (observed). Although FMR expects the
same holiday schedule, with the addition of New Year's Day, to be observed
in the future, the New York Fed or the NYSE may modify its holiday
schedule at any time. The right is reserved to advance the time on that day
by which purchase and redemption orders must be received on any day that:
(1) the New York Fed or the NYSE closes early or, in the case of
T reasury Portfolio II, the principal government securities markets
close early, such as on days in advance of holidays generally observed by
participants in such markets; (2) if, in FMR's judgment, early closing
is deemed to be in the best interest of each Portfolio's shareholders;
or, (3) as permitted by the SEC. To the extent that each Portfolio's
securities are traded in other markets on days the New York Fed or
the NYSE is closed, each Portfolio's Class B N AV may be affected
when investors do not have access to a Portfolio to purchase or redeem
Class B shares. Certain Fidelity funds may follow different holiday
closing schedules.
HOW NET ASSET VALUE IS DETERMINED. Each Portfolio values its investments on
the basis of amortized cost. This technique involves valuing an instrument
at its cost as adjusted for amortization of premium or accretion of
discount rather than its value based on current market quotations or
appropriate substitutes which reflect current market conditions. The
amortized cost value of an instrument may be higher or lower than the price
a Portfolio would receive if it sold the instrument.
Valuing a Portfolio's instruments on the basis of amortized cost and use of
the term "money market fund" are permitted by Rule 2a-7 under the 1940 Act.
The Portfolios must adhere to certain conditions under Rule 2a-7; these
conditions are summarized under "Regulatory Requirements" on page .
The Board of Trustees of the Fund oversees FMR's adherence to SEC rules
concerning money market funds, and has established procedures designed to
stabilize each Portfolio's NAV for each c lass at $1.00 per share. At
such intervals as they may deem appropriate, the Trustees consider the
extent to which NAV calculated by using market valuations would deviate
from $1.00. If the Trustees believe that a deviation from a Portfolio's
amortized cost per share may result in material dilution or other unfair
results to shareholders, the Trustees have agreed to take such corrective
action, if any, as they deem appropriate to eliminate or reduce, to the
extent reasonably practicable, the dilution or unfair results. Such
corrective action could include selling portfolio instruments prior to
maturity to realize capital gains or losses or to shorten average portfolio
maturity; withholding dividends; redeeming shares in kind; establishing NAV
by using available market quotations; and such other measures as the
Trustees may deem appropriate.
During periods of declining interest rates, a Portfolio's yield based on
amortized cost may be higher than such portfolio's yield based on
market valuations. Under these circumstances, a shareholder in a Portfolio
would be able to obtain a somewhat higher yield than would result if the
Portfolio utilized market valuations to determine its NAV. The converse
would apply in a period of rising interest rates.
DISTRIBUTIONS AND TAXES
DIVIDENDS. Each Portfolio ordinarily declares dividends from net investment
income daily and pays such dividends monthly. Each Portfolio intends to
distribute substantially all of its net investment income and
capital gains, if any, to shareholders within each calendar year as well as
on a fiscal year basis.
Dividends from the Portfolios will not normally qualify for the
dividends-received deduction available to corporations, since a Portfolio's
income is primarily derived from interest income and short-term capital
gains. Depending upon state law, a portion of each Portfolio's dividends
attributable to interest income derived from U.S. government securities may
be exempt from state and local taxation. The Portfolios will provide
information on the portion of each Portfolio's dividends, if any, that
qualify for this exemption.
CAPITAL GAIN DISTRIBUTIONS. The Portfolios may distribute short-term
capital gains once a year or more often as necessary to maintain their NAV
at $1.00 per share or to comply with distribution requirements under
federal tax law. The Portfolios do not anticipate earning long-term capital
gains on securities held by the Portfolios.
FEDERAL TAXES. Dividends derived from net investment income and short-term
capital gains are taxable as ordinary income. Distributions are taxable
when paid, whether investors receive distributions in cash or reinvest them
in additional shares, except that distributions declared in December and
paid in January are taxable as if paid on December 31st. The Portfolios
will send investors an IRS Form 1099-DIV by January 31st showing their
taxable distributions for the past calendar year.
STATE AND LOCAL TAX ISSUES. For mutual funds organized as business trusts,
state law provide s for a pass-through of the state and local income
tax exemption afforded to direct owners of U.S. government securities.
Some states limit this pass through to mutual funds that invest a certain
amount in U.S. government securities, and some types of securities, such as
repurchase agreements and some agency backed securities, may not qualify
for this pass-through benefit. The tax treatment of your dividend
distributions from the fund will be the same as if you directly owned your
proportionate share of the U.S. government securities in the fund's
portfolio. Because the income earned on most U.S. government securities in
which the fund invests is exempt from state and local income taxes, the
portion of your dividends from the fund attributable to these securities
will also be free from income taxes. The exemption from state and local
income taxation does not preclude states from asse ss ing other taxes
on the ownership of U.S. government securities.
TAX STATUS OF THE FUND. Each Portfolio has qualified and intends to
continue to qualify as a "regulated investment company" under the Internal
Revenue Code of 1986 (the Code) , as amended, so that a Portfolio
will not be liable for federal income or excise taxes on net investment
income or capital gains to the extent that these are distributed to
shareholders in accordance with applicable provisions of the Code.
OTHER TAX INFORMATION. The information above is only a summary of some of
the federal tax consequences generally affecting a Portfolio and its
shareholders, and no attempt has been made to discuss individual tax
consequences. In addition to federal taxes, investors may be subject to
state or local taxes on their investment. Investors should consult their
tax advisors to determine whether a Portfolio is suitable to their
particular tax situation.
When investors sign their account application, they will be asked to
certify that their social security or taxpayer identification number is
correct and that they are not subject to 31% backup withholding for failing
to report income to the IRS. If investors violate IRS regulations, the IRS
can require a Portfolio to withhold 31% of taxable distributions and
redemptions.
Issuers of tax-exempt bonds should note that, although the U.S. Treasury
has adopted rules which allow certain issuers of tax-exempt bonds to take
into account qualified administrative costs in determining payments and
receipts on non-purpose investments, there is no assurance that expenses of
a Portfolio will meet this standard. Such issuers should consult their own
tax counsel before investing.
PORTFOLIO TRANSACTIONS
Money market obligations generally are traded in the over-the-counter
market through broker-dealers. A broker-dealer is a securities firm or bank
which makes a market for securities by offering to buy at one price and
sell at a slightly higher price. The difference between the prices is known
as a spread. Since FMR trades, directly or through affiliated sub-advisers,
a large number of securities, including those of Fidelity's other funds,
broker-dealers are willing to work with Portfolios on a more
favorable spread than would be possible for most individual investors.
All orders for the purchase or sale of portfolio securities are placed on
behalf of each Portfolio by FMR (either directly or through affiliated
sub-advisers) pursuant to authority contained in each Portfolio's
Management Contract. FMR is also responsible for the placement of
transaction orders for other investment companies and accounts for which it
or its affiliates act as investment adviser. Securities purchased and sold
by the Portfolios will be traded on a net basis (i.e., without commission).
In selecting broker-dealers, subject to applicable limitations of the
federal securities laws, FMR will consider various relevant factors,
including, but not limited to, the size and type of the transaction; the
nature and character of the markets for the security to be purchased or
sold; the execution efficiency, settlement capability, and financial
condition of the broker-dealer firm; the broker-dealer's execution services
rendered on a continuing basis; and the reasonableness of any commissions.
The Portfolios may execute portfolio transactions with broker-dealers who
provide research and execution services to the Portfolios and other
accounts over which FMR or its affiliates exercise investment discretion.
Such services may include advice concerning the value of securities; the
advisability of investing in, purchasing or selling securities; the
availability of securities or the purchasers or sellers of securities;
furnishing analyses and reports concerning issuers, industries, securities,
economic factors and trends, portfolio strategy, and performance of
accounts; and effecting securities transactions and performing functions
incidental thereto (such as clearance and settlement). FMR maintains a
listing of broker-dealers who provide such services on a regular basis.
However, as many transactions on behalf of the Portfolios are placed with
dealers (including broker-dealers on the list) without regard to the
furnishing of such services, it is not possible to estimate the proportion
of such transactions directed to such broker-dealers solely because such
services were provided. The selection of such broker-dealers is generally
made by FMR (to the extent possible consistent with execution
considerations) based upon the quality of research and execution services
provided.
The receipt of research from broker-dealers that execute transactions on
behalf of the Portfolios may be useful to FMR in rendering investment
management services to the Portfolios and/or its other clients, and
conversely, such research provided by broker-dealers who have executed
transaction orders on behalf of other FMR clients may be useful to FMR in
carrying out its obligations to the Portfolios. The receipt of such
research has not reduced FMR's normal independent research activities;
however, it enables FMR to avoid the additional expenses that could be
incurred if FMR tried to develop comparable information through its own
efforts.
Subject to applicable limitations of the federal securities laws,
broker-dealers may receive commissions for agency transactions that are in
excess of the amount of commissions charged by other broker-dealers in
recognition of their research and execution services. In order to cause the
Portfolios to pay such higher commissions, FMR must determine in good faith
that such commissions are reasonable in relation to the value of the
brokerage and research services provided by such executing broker-dealers,
viewed in terms of a particular transaction or FMR's overall
responsibilities to the Portfolios and its other clients. In reaching this
determination, FMR will not attempt to place a specific dollar value on the
brokerage and research services provided, or to determine what portion of
the compensation should be related to those services.
FMR is authorized to use research services provided by and to place
portfolio transactions with brokerage firms that have provided assistance
in the distribution of shares of the Portfolios or shares of other Fidelity
funds to the extent permitted by law. FMR may use research services
provided by and place agency transactions with Fidelity Brokerage Services,
Inc. (FBSI), a member of the New York Stock Exchange and a subsidiary of
FMR Corp., if the commissions are fair and reasonable and comparable to
commissions charged by non-affiliated, qualified brokerage firms for
similar services. Section 11(a) of the Securities Exchange Act of 1934
prohibits members of national securities exchanges from executing exchange
transactions for accounts which they or their affiliates manage, unless
certain requirements are satisfied. Pursuant to such requirements, the
Board of Trustees has authorized FBSI to execute portfolio transactions on
national securities exchanges in accordance with approved procedures and
applicable SEC rules.
The Board of Trustee s periodically reviews FMR's performance of its
responsibilities in connection with the placement of portfolio transactions
on behalf of the Portfolios and review s the commissions paid by the
Portfolios over representative periods of time to determine if they are
reasonable in relation to the benefits to the Portfolios.
From time to time the Board of Trustees will review whether the
recapture for the benefit of the Portfolios of some portion of the
brokerage commissions or similar fees paid by the Portfolios on portfolio
transactions is legally permissible and advisable. The Portfolios seek to
recapture soliciting broker-dealer fees on the tender of portfolio
securities, but at present no other recapture arrangements are in effect.
The Trustees intend to continue to review whether recapture opportunities
are available and are legally permissible and, if so, to determine, in the
exercise of their business judgment, whether it would be advisable for the
Portfolios to seek such recapture.
Although the Trustees and officers of the Fund are substantially the
same as those of other funds managed by FMR, investment decisions for the
Portfolios are made independently from those of other funds managed by FMR
or accounts managed by FMR affiliates. It sometimes happens that the same
security is held in the portfolio of more than one of these funds or
accounts. Simultaneous transactions are inevitable when several funds are
managed by the same investment adviser, particularly when the same security
is suitable for the investment objective of more than one fund.
When two or more funds are simultaneously engaged in the purchase or sale
of the same security, the prices and amounts are allocated in accordance
with a formula considered by the officers of the funds involved to be
equitable to each fund. In some cases this system could have a detrimental
effect on the price or value of the security as far as the Portfolios are
concerned. In other cases, however, the ability of Portfolios to
participate in volume transactions will produce better executions and
prices for the Portfolios. It is the current opinion of the Trustees that
the desirability of retaining FMR as investment adviser to the Portfolios
outweighs any disadvantages that may be said to exist from exposure to
simultaneous transactions.
PERFORMANCE
From time to time each Portfolio advertises its YIELD and EFFECTIVE YIELD
in advertisements or in reports or other communications with shareholders.
(Yield and total return figures will differ among each class of a
Portfolio's shares.) Both yield figures are based on historical earnings
and are not intended to indicate future performance. The CURRENT YIELD
refers to the income generated by an investment in a Portfolio over a
seven-day period (which will be stated in the advertisement). The net
change in value of a hypothetical account containing one share reflects the
value of additional shares purchased with dividends from the one original
share and dividends declared on both the original share and any additional
shares. 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 each Portfolio is assumed
to be reinvested. The effective yield will be slightly higher than the
yield because of the compounding effect of this assumed reinvestment. In
addition to the current yield, a Portfolio may quote yields in advertising
based on any historical seven day period.
The yield and effective yield figures for each class ar e
illustrated below for the seven-day period ended March 3 1, 1994.
Class A Class B
Effective Effective
Yield Yield Yield Yield
Treasury Portfolio* 3.32% 3.38% -- --
Treasury Portfolio II 3.32% 3.38% 3.00% 3.04%
Government Portfolio* 3.39% 3.45% -- --
Domestic Portfolio* 3.39% 3.45% -- --
Money Market Portfolio 3.48% 3.54% 3.16% 3.21%
* Class B not operational during this period.
Yield information may be useful in reviewing each Portfolio's performance
and for providing a basis for comparison with other investment
alternatives. Each Portfolio's yield will fluctuate, unlike investments
which pay a fixed yield for a stated period of time. Investors should give
consideration to the quality and maturity of portfolio securities of the
respective investment companies when comparing investments.
Each Portfolio's TOTAL RETURN is based on the overall dollar or percentage
change in value of a hypothetical investment in a Portfolio, assuming
dividends are reinvested. A CUMULATIVE TOTAL RETURN reflects a Portfolio's
performance over a stated period of time. An AVERAGE ANNUAL TOTAL RETURN
reflects the hypothetical annually compounded return that would have
produced the same cumulative total return if performance had been constant
over the entire period. Because average annual returns tend to smooth out
variations in a Portfolio's performance, investors should recognize that
they are not the same as actual year-by-year results.
The Portfolios' performance, or the performance of securities in which they
may invest, may be compared to:
(bullet) IBC/Donoghue's MONEY FUND AVERAGES (trademark), which are
average yields of various types of money market funds that include the
effect of compounding distributions, assume reinvestment of distributions,
are reported in IBC/Donoghue's MONEY FUND REPORT (Registered trademark),
and are published by IBC USA (Publications), Inc. of Ashland,
Massachusetts;
(bullet) Other mutual funds in general, or to the performance of specific
types of mutual funds. These comparisons may be expressed as mutual fund
rankings prepared by Lipper Analytical Services, Inc. (Lipper), an
independent service located in Summit, New Jersey that monitors the
performance of mutual funds. Lipper generally ranks funds on the basis of
total return, assuming reinvestment of distributions, but does not take
sales charges or redemption fees into consideration, and is prepared
without regard to tax consequences. Lipper may also rank the funds based on
yield. In addition to the mutual fund rankings, a Portfolio's performance
may be compared to mutual fund performance indices prepared by Lipper;
(bullet) Yields on other money market securities or averages of other money
market securities as reported by the Federal Reserve Bulletin; by TeleRate,
a financial information network; or by Salomon Brothers Inc., a
broker-dealer firm; and
(bullet) Fixed-income investments such as Certificates of Deposit
(C D s).
The principal value and interest rate of C D s and certain other money
market securities are fixed generally at the time of purchase,
whereas each Portfolio's yield will fluctuate. Unlike some CDs and certain
other money market securities, money market mutual funds are not insured by
the FDIC. Investors should give consideration to the quality and maturity
of the portfolio securities of the respective investment companies when
comparing investment alternatives. The Portfolios also may reference the
growth and variety of money market mutual funds and the Adviser's
innovation and participation in the industry.
Each Portfolio may discuss its fund number, Quotron (trademark)
number, CUSIP number, and current portfolio manager.
From time to time, in reports and promotional literature, each Portfolio's
performance also may be compared to other mutual funds tracked by financial
or business publications and periodicals. For example, each Portfolio may
quote Morningstar, Inc. in its advertising materials. Morningstar, Inc. is
a mutual fund rating service that rates mutual funds on the basis of
risk-adjusted performance. In addition, each Portfolio may quote financial
or business publications and periodicals as they relate to fund management,
investment philosophy, and investment techniques. Rankings that compare the
performance of Fidelity funds to one another in appropriate categories over
specific periods of time may also be quoted in advertising.
MANAGEMENT CONTRACTS, DISTRIBUTION PLANS AND SERVICE AGREEMENTS
MANAGEMENT CONTRACTS. Each Portfolio employs FMR to furnish investment
advisory and other services to the Portfolio. Under FMR's Management
Contract with each Portfolio, FMR acts as investment adviser and, subject
to the supervision of the Board of Trustees, directs the investments of
each Portfolio in accordance with its investment objective, policies and
limitations. FMR also provides each Portfolio with all necessary office
facilities, equipment and personnel for servicing the Portfolio's
investments, and compensates all officers of the Fund, all Trustees who are
"interested persons" of the Fund or of FMR, and all personnel of the Fund
or FMR performing services relating to research, statistical and investment
activities.
In addition, FMR or its affiliates, subject to the supervision of the Board
of Trustees, provides the management and administrative services necessary
for the operation of each Portfolio. These services include providing
facilities for maintaining each Portfolio's organization; supervising
relations with the custodians, transfer and pricing agents, accountants,
underwriters and other persons dealing with the Portfolios; preparing all
general shareholder communications and conducting shareholder relations;
maintaining the Fund's records and the registration of each Portfolio's
shares under federal and state securities laws; developing management and
shareholder services for each Portfolio and furnishing reports, evaluations
and analyses on a variety of subjects to the Trustees. As described below,
FMR has agreed to limit each Portfolio's expenses.
For these services each Portfolio pays a monthly fee to FMR at the annual
rate of .20% of the average net assets of the Portfolio as determined as of
the close of business on each day throughout the month.
For the fiscal years ended March 31, 1994, 1993 and 1992, management fees
before reimbursement of expenses were $ 3,796,042 , $5,351,145 and
$4,236,988 for Treasury Portfolio, $ 9,834,015, $14,029,197 and
$8,506,023 for Treasury Portfolio II, $ 9,660,519 , $12,610,880 and
$8,576,656 for Government Portfolio, $ 1,525,574 , $1,536,740 and
$1,095,503 for Domestic Portfolio, and $ 10,551,990 , $10,066,276 and
$9,604,202 for M oney Market Portfolio, respectively.
In addition to the management fee payable to FMR and the fees payable to
Service and FIIOC, and subject to the reimbursement provisions described
below, each Portfolio pays all its expenses, without limitation, that are
not assumed by those parties. Each Portfolio pays for the typesetting,
printing and mailing of its proxy material to shareholders, and for legal
expenses and the fees of the custodian, auditor and non-interested
Trustees. Other charges paid by each Portfolio include: interest, taxes,
brokerage commissions, the Portfolio's proportionate share of insurance
premiums and Investment Company Institute dues, and the costs of
registering shares under federal and state securities laws. Each Portfolio
also is liable for such nonrecurring expenses as may arise, including costs
of litigation to which the Portfolio is a party and any obligation it may
have to indemnify officers and Trustees with respect to such litigation.
Although each Portfolio's current Management Contract provides that the
Portfolio will pay for typesetting, printing and mailing of Prospectuses,
Statements of Additional Information and reports to existing shareholders,
the Portfolios entered into a revised transfer agent agreement with FIIOC
effective June 1, 1989, pursuant to which FIIOC bears the cost of providing
these services.
FMR has voluntarily agreed to reimburse Class B of each of the
Portfolios if and to the extent that the aggregate operating
expenses of Class B (excluding interest, taxes, brokerage
commissions, extraordinary expenses and 12b-1 fees) exceed an annual rate
of .18% of the average net assets of Class B for any fiscal year or
for a portion of such year if FMR's agreement is terminated or revised. FMR
retains the ability to be repaid by Class B of the Portfolios for
these expense reimbursements in the amount that expenses fall below the
limit prior to the end of the fiscal year. FMR will continue this
reimbursement arrangement subject to revision upon 90 days' notice to
shareholders. Such reimbursements have the effect of artificially
decreasing a Portfolio's Class B expenses, thereby increasing
the yield of such Portfolio's Class B shares .
For the fiscal year ended March 31, 1994, only Treasury II and Money
Market Portfolio had Class B shares in operation. Aggregate operating
expenses reimbursed by FMR were $570 for Treasury Portfolio II, and $7,565
for Money Market Portfolio.
SUB-ADVISORY AGREEMENTS. With respect to each Portfolio, FMR has entered
into a sub-advisory agreement with FMR Texas, a Texas corporation with
principal offices at 400 East Las Colinas Boulevard in Irving, Texas.
Pursuant to the agreement, FMR Texas has primary responsibility for
providing portfolio investment management services to each Portfolio, while
FMR retains responsibility for providing other portfolio management
services.
Under each sub-advisory agreement, FMR pays FMR Texas fees equal to 50% of
the management fees payable to FMR under its current Management Contract
with each Portfolio. The fees paid to FMR Texas are not reduced by any
voluntary or mandatory expense reimbursements that may be in effect from
time to time.
For the fiscal years ended March 31, 1994, 1993 and 1992, fees paid to FMR
Texas by FMR were $ 1,898,021 , $2,675,57 3 and $2,118,494 for
Treasury Portfolio, $ 4,917,008 , $7,014,599 and $4,253,012 for
Treasury Portfolio II, $ 4,830,260, $6,305,440 and $4,288,328 for
Government Portfolio, $ 762,787 , $768,370 and $547,752 for Domestic
Portfolio and $ 5,275,995 , $5,033,138 and $4,802,101 for Money Market
Portfolio, respectively.
CONTRACTS WITH COMPANIES AFFILIATED WITH FMR. F IIOC , 82 Devonshire
Street, Boston, Massachusetts 02109, an affiliate of FMR, is transfer,
dividend-paying and shareholder servicing agent for each Portfolio and
maintains shareholder records.
For institutional client master accounts effective June 1, 1990, FIIOC
receives a per account fee and a monetary transaction fee of $65 and $14,
respectively, or $60 and $12, respectively, depending on the nature of
services provided. Effective January 1, 1993, FIIOC is paid a per account
fee of $95 and a monetary transaction fee of $20 or $17.50 depending on the
nature of the services provided. Fees for institutional retirement plan
accounts, if any, would be based on the NAV of all such accounts in a
Portfolio. In addition, FIIOC pays out-of-pocket expenses associated with
providing transfer agent services and bears the expense of typesetting,
printing and mailing Prospectuses, Statements of Additional Information,
reports, notices and statements to shareholders.
For the fiscal years ended March 31, 1994, only the U.S. Treasury II and
Money Market portfolios were in operation. Transfer agent fees and expenses
were $113 for Treasury Portfolio II and $1,860 for Money Market
Portfolio.
The Portfolios' contracts with S e rvice, an affiliate of FMR,
provides that Service will perform the calculations necessary to determine
each Portfolio ' s net asset value per share and dividends and
to maintain general accounting records. Prior to July 1, 1991, the annual
fee for these pricing and bookkeeping services was based on two schedules,
one pertaining to each Portfolio's average net assets and one pertaining to
the type and number of transactions a Portfolio made. The fee rates in
effect as of July 1, 1991 are based on each Portfolio's average net assets,
specifically .0175% for the first $500 million of average net assets and
.0075% for average net assets in excess of $500 million. The fee is limited
to a minimum of $20,000 and a maximum of $750,000 per year for each
Portfolio.
For the fiscal years ended March 31, 1994, 1993 and 1992, portfolio
accounting fees paid to Service for pricing and bookkeeping services
(including related out-of-pocket expenses) were $ 192,236 , $251,607
and $210,011 for Treasury Portfolio, $ 419,147 , $576,072 and $354,383
for Treasury Portfolio II, $ 412,411 , $523,696 and $346,477 for
Government Portfolio, $ 107,464 , $108,548 and $95,756 for Domestic
Portfolio, and $ 445,362 , $429,428 and $376,076 for Money Market
Portfolio, respectively.
Service also receives fees for administering the Portfolios' securities
lending programs where applicable. Securities lending fees are based on the
number and duration of individual securities loans.
Each Portfolio has a Distribution Agreement with Fidelity Distributors
Corporation (Distributors), an affiliate of FMR. Distributors, a
Massachusetts corporation organized July 18, 1960, is a broker-dealer
registered under the Securities Exchange Act of 1934 and is a member of the
National Association of Securities Dealers, Inc. (NASD). The
Distribution Agreement calls for Distributors to use all reasonable
efforts, consistent with its other business, to secure purchasers for
shares of each Portfolio. Promotional and administrative expenses in
connection with the offer and sale of shares are paid by FMR. Distributors
also acts as general distributor for other publicly offered Fidelity funds.
DISTRIBUTION AND SERVICE PLANS. The Board of Trustees has adopted, on
behalf of Class B of each Portfolio , a Distribution and Service
P lan ( each Plan) pursuant to Rule 12b-1 of the 1940 Act (the
Rule). The Rule provides in substance that a mutual fund may not engage
directly or indirectly in financing any activity that is intended primarily
to result in the sale of shares of the fund except pursuant to a plan
adopted by the fund under the Rule. The Fund's Board of Trustees adopted
the Plans to assure that Class B of each Portfolio and FMR may incur
certain expenses that might be considered to constitute indirect payment by
Class B of the Portfolio of distribution expenses.
Currently the Trustees have authorized Class B of each Portfolio except
Government Portfolio to pay Distributors at an annual rate of up
to . 3 2%. Government Portfolio is authorized to pay
Distributors at an annual rate of up to .25%. This distribution fee is
paid by Class B and not by individual accounts. The amount of a
particular day's 12b-1 fee and other expenses will not exceed that day's
income.
All or a portion of the distribution fee is paid by Distributors to banks
and other financial intermediaries as compensation for providing Class B
sales and/or shareholder support services. The distribution fee is a
component of the annual operating expenses of Class B and will reduce yield
and return.
Payments made by Class B of each Portfolio to Distributors, which
are then paid to banks and other financial intermediaries, will be limited
by the maximums established by the NASD rule regarding asset-based sales
charges .
Each Plan specifically recognizes that FMR, either directly or through
Distributors, may use its management fee revenue, past profits or other
resources, without limitation, to pay promotional and administrative
expenses in connection with the offer and sales of Class B shares of the
Portfolios. In addition, each Plan provides that FMR may use its resources,
including its management fee revenues, to make payments to banks and other
financial intermediaries that provide Class B sales and/or shareholder
support services. The Trustees have not authorized any such payments.
As required by the Rule, the Trustees carefully considered all pertinent
factors relating to the implementation of each Plan prior to its approval,
and have determined that there is a reasonable likelihood that each Plan
will benefit the Class B shares of the relevant Portfolio s
and their shareholders. To the extent that the Plans give FMR and
Distributors greater flexibility in connection with the distribution of
Class B shares of the Portfolios, additional s ales of each
Portfolio's Class B shares may result. Additionally, certain
shareholder support services may be provided more effectively under the
Plans by local entities with whom shareholders have other relationships.
The Glass-Steagall Act generally prohibits federally and state chartered or
supervised banks from engaging in the business of underwriting, selling or
distributing securities. Although the scope of this prohibition under the
Glass-Steagall Act has not been clearly defined, in Distributors' opinion
it should not prohibit banks from being paid for shareholder servicing and
recordkeeping functions. Distributors intends to engage banks only for the
purpose of performing such functions. However, changes in federal or state
statutes and regulations pertaining to the permissible activities of banks
and their affiliates or subsidiaries, as well as further judicial or
administrative decisions or interpretations, could prevent a bank from
continuing to perform all or a part of the contemplated services. If a bank
were prohibited from so acting, the Trustees would consider what actions,
if any, should be taken to continue to provide efficient and effective
shareholder services. In such event, changes in the operation of the
Portfolios might occur, including possible termination of any automatic
investment or redemption or other services then being provided by the bank.
It is not expected that shareholders would suffer any adverse financial
consequences as a result of any of these occurrences. In addition, state
securities laws on this issue may differ from the interpretations of
federal law expressed herein, and banks and financial institutions may be
required to register as dealers pursuant to state law. The Portfolios may
execute portfolio transactions with and purchase securities issued by
depository institutions that receive payments under the Plans. No
preference for the instruments of depository institutions will be
shown in the selection of investments .
DESCRIPTION OF THE FUND
FUND ORGANIZATION. Treasury Portfolio , Treasury Portfolio II ,
Government Portfolio , Domestic Portfolio and Money Market
Portfolio are series of Fidelity Institutional Cash Portfolios,
which is an open-end management investment company organized as a Delaware
b usiness trust on May 30, 1993. The Portfolios acquired all of
the assets of the series of a Massachusetts business
t rust, Fidelity Institutional Cash Portfolios , on May 30, 1993.
Currently, there are five Portfolios in the Fund. Each Portfolio
currently offers two c lasses of shares, Class A and Class B. The
Trust Instrument permits the Trustees to create additional s eries .
Class A shares of each Portfolio are offered to institutional and corporate
investors. Each Portfolio's Class A has a Distribution and Service Plan
pursuant to Rule 12b-1 (the Class A Plans) . Each Plan does not
provide for payment of a separate distribution fee by Class A. Rather, the
Class A Plan recognizes that FMR may use its management fee and
other resources to pay expenses for distribution related activities and
make payments to banks or other financial intermediaries that provide
Class A sales and/or shareholder support services. Banks and other
financial intermediaries do not receive Class A Plan related
compensation in connection with providing sales and/or shareholder support
services. The total operating expenses of Class A of each Portfolio are
expected to be .18% of its average net assets. Class A shares may be
exchanged for Class A shares of any other Portfolio of the Fund or for
shares of Fidelity Institutional Tax-Exempt Cash Portfolios.
In the event that FMR ceases to be the investment adviser t o the
fund or a Portfolio, the right of the Fund or Portfolio to use the
identifying name "Fidelity" may be withdrawn. There is a remote possibility
that one Portfolio might become liable for any misstatement in its
Prospectus and Statement of Additional Information about another Portfolio.
The assets of the Fund received for the issue or sale of shares of each of
its Portfolios and all income, earnings, profits, and proceeds thereof,
subject only to the rights of creditors, are especially allocated to such
Portfolio, and constitute the underlying assets of such Portfolio. The
underlying assets of each Portfolio are segregated on the books of account,
and are to be charged with the liabilities with respect to such Portfolio
and with a share of the general expenses of the Fund. Expenses with respect
to the Fund are to be allocated in proportion to the asset value of the
respective Portfolios or classes except where allocations of direct
expense can otherwise be fairly made. The officers of the Fund, subject to
the general supervision of the Board of Trustees, have the power to
determine which expenses are allocable to a given Portfolio or
class , or which are general or allocable to all of the Portfolios. In
the event of the dissolution or liquidation of the Fund, shareholders of
each Portfolio are entitled to receive as a class the underlying assets of
such Portfolio available for distribution.
SHAREHOLDER AND TRUSTEE LIABILITY. The Fund is a business trust organized
under Delaware law. Delaware law provides that shareholders shall be
entitled to the same limitations of personal liability extended to
stockholders of private corporations for profit. The courts of some states,
however, may decline to apply Delaware law on this point. The Trust
Instrument contains an express disclaimer of shareholder liability for the
debts, liabilities, obligations, and expenses of the Fund and requires that
a disclaimer be given in each contract entered into or executed by the Fund
or the Trustees. The Trust Instrument provides for indemnification out of
each Portfolio's property of any shareholder or former shareholder held
personally liable for the obligations of the Portfolio. The Trust
Instrument also provides that each Portfolio shall, upon request, assume
the defense of any claim made against any shareholder for any act or
obligation of the Portfolio and satisfy any judgment thereon. Thus, the
risk of a shareholder incurring financial loss on account of shareholder
liability is limited to circumstances in which Delaware law does not apply,
no contractual limitation of liability was in effect, and the Portfolio is
unable to meet its obligations. FMR believes that, in view of the above,
the risk of personal liability to shareholders is extremely remote.
The Trust Instrument further provides that the Trustees, if they have
exercised reasonable care, shall not be personally liable to any person
other than the Fund or its shareholders; moreover, the Trustees shall not
be liable for any conduct whatsoever, provided that Trustees are not
protected against any liability to which they would otherwise be subject by
reason of willful misfeasance, bad faith, gross negligence, or reckless
disregard of the duties involved in the conduct of their office.
VOTING RIGHTS. Each class of each Portfolio's capital consists of shares of
beneficial interest. The shares have no preemptive or conversion rights;
the voting and dividend rights, the right of redemption, and the privilege
of exchange are described in this Prospectus. Shares are fully paid and
non - assess i ble, except as set forth under the heading
"Shareholder and Trustee Liability" above. Shareholders representing 10% or
more of the Fund, a Portfolio or a c lass may, as set forth in the
Trust Instrument , call meetings of the Fund , Portfolio or
class, for any purpose related to the Fund, Portfolio or c lass,
as the case may be, including, in the case of a meeting of the entire Fund,
the purpose of voting on removal of one or more Trustees.
The Fund or a Portfolio may be terminated upon the sale of
its assets to another open-end management investment company, or upon
liquidation and distribution of its assets. Generally such terminations
must be approved by vote of the holders of a majority of the outstanding
shares of the Fund or Portfolio; however, the Trustees may, without
prior shareholder approval, change the form or organization of the Fund by
merger, consolidation, or incorporation. If not so terminated, the Fund
and the Portfolios will continue indefinitely.
Under the Trust Instrument, the Trustees may, without shareholder vote,
cause the Fund to merge or consolidate into one or more trusts,
partnerships, or corporations, or cause the Fund to be incorporated under
Delaware law, so long as the surviving entity is an open-end management
investment company that will succeed to or assume the Fund 's
registration statement.
As of March 31, 1994 the following owned of record or beneficially
more than 5% of the outstanding shares of Class B:
Treasury Portfolio
Michigan National Bank, Farmington Hills, MI 22.11%
Wachovia Bank & Trust, Winston-Salem, NC 7.18%
First Bank Systems, Minneapolis, MN 7.03%
Bank of America, San Francisco, CA 5.99%
Treasury Portfolio II
First Union Bank of Charlotte, Charlotte, NC 13.97%
Bank of America, San Francisco, CA 13.22%
First Tennesee Bank, Memphis, TN 9.20%
Texas Commerce Bank, N.A., Houston, TX 5.15%
Government Portfolio
First Tennessee Bank, Memphis, TN 8.71%
First Trust of St. Paul, St. Paul, MN 8.31%
Mass General Hospital, Boston, MA 7.70%
Mass Water Resource Authority, Boston, MA 7.54%
Texas Commerce Bank, N.A., Houston, TX 5.45%
Domestic Portfolio
First Union Bank of Charlotte, Charlotte, NC 34.74%
Texas Commerce Bank, N.A., Houston, TX 10.61%
Union Trust Company, New Haven, CT 10.25%
Money Market Portfolio
Shawmut Bank N.A., Boston, MA 11.80%
First Bank System, Minneapolis, MN 6.45%
A shareholder owning more than 25% of the Portfolio's shares may be
considered a "controlling person" of the Portfolio. Accordingly, its vote
could have a more significant effect on matters presented at a
shareholders' meeting than the other shareholders of the Portfolio.
CUSTODIAN. Morgan Guaranty Trust Company of New York, 60 Wall Street, New
York, NY 10260 is custodian of the assets of all Portfolios ,
except Treasury Portfolio II. As of September 15, 1993, the custodian for
Treasury Portfolio II is the Bank of New York, 48 Wall Street, New York,
New York. The custodian is responsible for the safekeeping of the
Portfolios' assets and the appointment of subcustodian banks and clearing
agencies. The custodian takes no part in determining the investment
policies of the Portfolio or in deciding which securities are
purchased or sold by the Portfolio . The Portfolios, however, may
invest in obligations of the custodian and may purchase securities from or
sell securities to the custodian.
FMR, its officers and directors and its affiliated companies and the Fund's
Trustees may, from time to time, have transactions with various banks,
including banks serving as custodians for certain of o the r
funds advised by FMR. Transactions that have occurred to date include
mortgages and personal and general business loans. In the judgment of FMR,
the terms and conditions of those transactions were not influenced by
existing or potential custodial or other Fund relationships.
AUDITOR. Price Waterhouse , 1700 Pacific Ave., Dallas, TX 75201,
serves as the Fund's independent accountants. The auditor examines
financial statements for the Fund and provides other audit, tax, and
related services.
FMR. FMR, 82 Devonshire Street, Boston, Massachusetts 02109, is a wholly
owned subsidiary of FMR Corp., a parent company organized in 1972. At
present, the principal operating activities of FMR Corp. are those
conducted by three of its divisions as follows: Fidelity Service Co., which
is the transfer and shareholder servicing agent for certain of the funds
advised by FMR; Fidelity Investments Institutional Operations Company,
which performs shareholder servicing functions for certain institutional
customers; and Fidelity Investments Retail Services Marketing Company,
which provides marketing services to various companies within the Fidelity
organization. Through ownership of voting common stock, Edward C. Johnson
3rd (President and a Trustee of the Fund), Johnson family members, and
various trusts for the benefit of the Johnson family form a controlling
group with respect to FMR Corp.
Several affiliates of FMR also are engaged in the investment advisory
business. Fidelity Management Trust Company provides trustee, investment
advisory and administrative services to retirement plans and corporate
employee benefit accounts. Fidelity Management & Research (U.K.) Inc.
(FMR U.K.) and Fidelity Management & Research (Far East) Inc. (FMR Far
East), both wholly owned subsidiaries of FMR formed in 1986, supply
investment research, and may supply portfolio management services, to FMR
in connection with certain funds advised by FMR. Analysts employed by FMR,
FMR U.K., and FMR Far East research and visit thousands of domestic
companies each year. FMR Texas, a wholly owned subsidiary of FMR formed in
1989, supplies portfolio management and research services in connection
with certain money market funds advised by FMR.
TRUSTEES AND OFFICERS. The Trustees and executive officers of the Fund 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.
Trustees and officers elected or appointed prior to the Fund' s
conversion to a Delaware business trust served the Massachusetts business
trust in identical capacities. All persons named as Trustees and officers
also serve in similar capacities for other funds advised by FMR. Unless
otherwise noted, the business address of each Trustee and officer is 82
Devonshire Street, Boston, MA 02109, which also is the address of FMR.
Those Trustees who are "interested persons" (as defined in the 1940 Act) by
virtue of their affiliation with either the Fund or FMR, are indicated by
an asterisk (*).
*EDWARD C. JOHNSON 3d, Trustee and President, is Chairman, Chief
Executive Officer and a Director of FMR Corp.; a Director and Chairman of
the Board and of the Executive Committee of FMR; Chairman and a Director of
FMR Texas Inc. (1989), Fidelity Management & Research (U.K.) Inc., and
Fidelity Management & Research (Far East) Inc.
*J. GARY BURKHEAD, Trustee and Senior Vice President, is President of
FMR; and President and a Director of FMR Texas Inc. (1989), Fidelity
Management & Research (U.K.) Inc., and Fidelity Management &
Research (Far East) Inc.
RALPH F. COX, 200 Rivercrest Drive, Fort Worth, TX, Trustee (1991), is a
consultant to Western Mining Corporation (1994). Prior to February 1994, he
was President of Greenhill Petroleum Corporation (petroleum exploration and
production, 1990). Until March 1990, Mr. Cox was President and Chief
Operating Officer of Union Pacific Resources Company (exploration and
production). He is a Director of Sanifill Corporation (non-hazardous waste,
1993) and CH2M Hill Companies (engineering). In addition, he served on the
Board of Directors of the Norton Company (manufacturer of industrial
devices, 1983-1990) and continues to serve on the Board of Directors of the
Texas State Chamber of Commerce, and is a member of advisory boards of
Texas A&M University and the University of Texas at Austin.
PHYLLIS BURKE DAVIS, P.O. Box 264, Bridgehampton, NY, Trustee (1992).
Prior to her retirement in September 1991, Mrs. Davis was the Senior Vice
President of Corporate Affairs of Avon Products, Inc. She is currently a
Director of BellSouth Corporation (telecommunications), Eaton Corporation
(manufacturing, 1991), and the TJX Companies, Inc. (retail stores, 1990),
and previously served as a Director of Hallmark Cards, Inc. (1985-1991) and
Nabisco Brands, Inc. In addition, she serves as a Director of the New York
City Chapter of the National Multiple Sclerosis Society, and is a member of
the Advisory Council of the International Executive Service Corps. and the
President's Advisory Council of The University of Vermont School of
Business Administration.
RICHARD J. FLYNN, 77 Fiske Hill, Sturbridge, MA, Trustee, is a financial
consultant. Prior to September 1986, Mr. Flynn was Vice Chairman and a
Director of the Norton Company (manufacturer of industrial devices). He is
currently a Director of Mechanics Bank and a Trustee of College of the Holy
Cross and Old Sturbridge Village, Inc.
E. BRADLEY JONES, 3881-2 Lander Road, Chagrin Falls, OH, Trustee (1990).
Prior to his retirement in 1984, Mr. Jones was Chairman and Chief Executive
Officer of LTV Steel Company. Prior to May 1990, he was Director of
National City Corporation (a bank holding company) and National City Bank
of Cleveland. He is a Director of TRW Inc. (original equipment and
replacement products), Cleveland-Cliffs Inc (mining), NACCO Industries,
Inc. (mining and marketing), Consolidated Rail Corporation, Birmingham
Steel Corporation, Hyster-Yale Materials Handling, Inc. (1989), and RPM,
Inc. (manufacturer of chemical products, 1990). In addition, he serves as a
Trustee of First Union Real Estate Investments, Chairman of the Board of
Trustees and a member of the Executive Committee of the Cleveland Clinic
Foundation, a Trustee and a member of the Executive Committee of University
School (Cleveland), and a Trustee of Cleveland Clinic Florida.
DONALD J. KIRK, 680 Steamboat Road, Apartment #1-North, Greenwich, CT,
Trustee, is a Professor at Columbia University Graduate School of Business
and a financial consultant. Prior to 1987, he was Chairman of the Financial
Accounting Standards Board. Mr. Kirk is a Director of General Re
Corporation (reinsurance) and Valuation Research Corp. (appraisals and
valuations, 1993). In addition, he serves as Vice Chairman of the Board of
Directors of the National Arts Stabilization Fund and Vice Chairman of the
Board of Trustees of the Greenwich Hospital Association.
*PETER S. LYNCH, Trustee (1990) is Vice Chairman of FMR (1992). Prior to
his retirement on May 31, 1990, he was a Director of FMR (1989) and
Executive Vice President of FMR (a position he held until March 31, 1991);
Vice President of Fidelity Magellan Fund and FMR Growth Group Leader; and
Managing Director of FMR Corp. Mr. Lynch was also Vice President of
Fidelity Investments Corporate Services (1991-1992). He is a Director of
W.R. Grace & Co. (chemicals, 1989) and Morrison Knudsen Corporation
(engineering and construction). In addition, he serves as a Trustee of
Boston College, Massachusetts Eye & Ear Infirmary, Historic Deerfield
(1989) and Society for the Preservation of New England Antiquities, and as
an Overseer of the Museum of Fine Arts of Boston (1990).
GERALD C. McDONOUGH, 135 Aspenwood Drive, Cleveland, OH, Trustee (1989),
is Chairman of G.M. Management Group (strategic advisory services). Prior
to his retirement in July 1988, he was Chairman and Chief Executive Officer
of Leaseway Transportation Corp. (physical distribution services). Mr.
McDonough is a Director of ACME-Cleveland Corp. (metal working,
telecommunications and electronic products), Brush-Wellman Inc. (metal
refining), York International Corp. (air conditioning and refrigeration,
1989), Commercial Intertech Corp. (water treatment equipment, 1992), and
Associated Estates Realty Corporation (a real estate investment trust,
1993).
EDWARD H. MALONE, 5601 Turtle Bay Drive #2104, Naples, FL, Trustee
(1988). Prior to his retirement in 1985, Mr. Malone was Chairman, General
Electric Investment Corporation and a Vice President of General Electric
Company. He is a Director of Allegheny Power Systems, Inc. (electric
utility), General Re Corporation (reinsurance) and Mattel Inc. (toy
manufacturer). In addition, he serves as a Trustee of Corporate Property
Investors, the EPS Foundation at Trinity College, the Naples Philharmonic
Center for the Arts, and Rensellaer Polytechnic Institute, and he is a
member of the Advisory Boards of Butler Capital Corporation Funds and
Warburg, Pincus Partnership Funds.
MARVIN L. MANN, 55 Railroad Avenue, Greenwich, CT, Trustee (1993) is
Chairman of the Board, President, and Chief Executive Officer of Lexmark
International, Inc. (office machines, 1991). Prior to 1991, he held the
positions of Vice President of International Business Machines Corporation
("IBM") and President and General Manager of various IBM divisions and
subsidiaries. Mr. Mann is a Director of M.A. Hanna Company (chemicals,
1993) and Infomart (marketing services, 1991), a Trammell Crow Co. In
addition, he serves as the Campaign Vice Chairman of the Tri-State United
Way (1993) and is a member of the University of Alabama President's Cabinet
(1990).
THOMAS R. WILLIAMS, 21st Floor, 191 Peachtree Street, N.E., Atlanta, GA,
Trustee (1988), is President of The Wales Group, Inc. (management and
financial advisory services). Prior to retiring in 1987, Mr. Williams
served as Chairman of the Board of First Wachovia Corporation (bank holding
company), and Chairman and Chief Executive Officer of The First National
Bank of Atlanta and First Atlanta Corporation (bank holding company). He is
currently a Director of BellSouth Corporation (telecommunications),
ConAgra, Inc. (agricultural products), Fisher Business Systems, Inc.
(computer software), Georgia Power Company (electric utility), Gerber Alley
& Associates, Inc. (computer software), National Life Insurance Company
of Vermont, American Software, Inc. (1989), and AppleSouth, Inc.
(restaurants, 1992).
GARY L. FRENCH, Treasurer (1991). Prior to becoming Treasurer of the
Fidelity funds, Mr. French was Senior Vice President, Fund Accounting -
Fidelity Accounting & Custody Services Co. (1991); Vice President, Fund
Accounting - Fidelity Accounting & Custody Services Co. (1990); and
Senior Vice President, Chief Financial and Operations Officer - Huntington
Advisers, Inc. (1985-1990).
ARTHUR S. LORING, Secretary, is Senior Vice President and General
Counsel of FMR, Vice President-Legal of FMR Corp., and Vice President and
Clerk of FDC.
ROBERT H. MORRISON, Manager, Security Transactions, is an employee of
FMR.
LELAND BARRON, Vice President (1989), is also Vice President of other funds
advised by FMR and an employee of FMR Texas Inc.
BURNELL STEHMAN, Vice President (1992), is also Vice President of other
funds advised by FMR and an employee of FMR Texas Inc.
JOHN TODD, Vice President (1992), is also Vice President of other funds
advised by FMR and an employee of FMR Texas Inc.
THOMAS D. MAHER, Assistant Vice President (1990), is Assistant Vice
President of Fidelity's money market funds and Vice President and Associate
General Counsel of FMR Texas Inc. (1990).
Under a retirement program which became effective on November 1, 1989, a
Trustee, upon reaching age 72, becomes eligible to participate in a defined
benefit retirement program under which he receives payments during his
lifetime from the Portfolios based on his final year's basic trustee fees
and length of service. Currently, Messrs. Robert L. Johnson, William R.
Spaulding, Bertram H. Witham, and David L. Yunich participate in the
program. The Trustees receive additional payments for serving in similar
capacities for other funds advised by FMR. The Trustees and officers of the
Fund as a group own less than 1% of each Portfolio's outstanding shares.
APPENDIX A
The following paragraphs provide a brief description of securities in
which the Portfolios may invest and transactions they may make. The
Portfolios are not limited by this discussion, however, and may purchase
other types of securities and enter into other types of transactions if
they are consistent with the Portfolios' respective investment objectives
and policies.
AFFILIATED BANK TRANSACTIONS. A Portfolio may engage in
transactions with financial institutions that are, or may be considered to
be, "affiliated persons" of the Portfolio under the 1940 Act. These
transactions may include repurchase agreements with custodian banks;
short-term obligations of, and repurchase agreements with, the 50 largest
U.S. banks (measured by deposits); municipal securities; U.S. government
securities with affiliated financial institutions that are primary dealers
in these securities; short-term currency transactions; and short-term
borrowings. In accordance with exemptive orders issued by the SEC, the
Board of Trustees has established and periodically reviews procedures
applicable to transactions involving affiliated financial institutions.
ASSET-BACKED SECURITIES may include pools of mortgages, loans,
receivables or other assets. Payment of principal and interest may be
largely dependent upon the cash flows generated by the assets backing the
securities, and, in certain cases, supported by letters of credit, surety
bonds, or other credit enhancements. The value of asset-backed securities
may also be affected by the creditworthiness of the servicing agent for the
pool, the originator of the loans or receivables, or the financial
institution(s) providing the credit support.
BANKERS' ACCEPTANCES. Negotiable obligations of a bank to pay a
draft which has been drawn on it by a customer. These obligations are
backed by large banks and usually are backed by goods in international
trade.
CERTIFICATES OF DEPOSIT. Negotiable certificates representing a
commercial bank's obligation to repay funds deposited with it, earning
specified rates of interest over a given period of time.
COMMERCIAL PAPER. Short-term obligations issued by banks,
broker-dealers, corporations, and other entities for purposes such as
financing their current operations.
CORPORATE OBLIGATIONS. Bonds and notes issued by corporations and
other business organizations in order to finance their long-term credit
needs.
DELAYED DELIVERY TRANSACTIONS. Each Portfolio may buy and sell
securities on a delayed delivery or when-issued basis. These transactions
involve a commitment by a Portfolio to purchase or sell specific securities
at a predetermined price or yield with payment and delivery taking place
after the customary settlement period for that type of security (and more
than seven days in the future). Typically, no interest accrues to the
purchaser until the security is delivered.
When purchasing securities on a delayed delivery basis, each Portfolio
assumes the rights and risks of ownership, including the risk of price and
yield fluctuations. Because a Portfolio is not required to pay for
securities until the delivery date, these risks are in addition to the
risks associated with the Portfolio's other investments. If a Portfolio
remains substantially fully invested at a time when delayed delivery
purchases are outstanding, the delayed delivery purchases may result in a
form of leverage. When delayed delivery purchases are outstanding, the
Portfolio will set aside appropriate liquid assets in a segregated
custodial account to cover its purchase obligations. When a Portfolio has
sold a security on a delayed delivery basis, the Portfolio does not
participate in further gains or losses with respect to the security. If the
other party to a delayed delivery transaction fails to deliver or pay for
the securities, the Portfolio could miss a favorable price or yield
opportunity, or could suffer a loss.
Each Portfolio may renegotiate delayed delivery transactions after they
are entered into, and may sell underlying securities before they are
delivered, which may result in capital gains or losses.
FINANCIAL SERVICES INDUSTRY. Because Domestic Portfolio and Money
Market Portfolio concentrate more than 25% of their respective total assets
in the financial services industry, their performance may be affected by
conditions affecting banks and other financial services companies.
Companies in the financial services industry are subject to various risks
related to that industry, such as governmental regulation, changes in
interest rates, and exposure on loans, including loans to foreign
borrowers. Investments in the financial services industry may include
obligations of U.S. branches of both foreign and domestic banks, savings
and loan associations, consumer and industrial finance companies,
securities brokerage companies, leasing companies, and a variety of firms
in the insurance field. These obligations include time deposits,
certificates of deposit, bankers' acceptances, and commercial paper.
FOREIGN SECURITIES. Eurodollar and Yankee dollar investments of
Money Market Portfolio risks include future unfavorable political and
economic developments, possible withholding taxes, seizure of foreign
deposits, currency controls, 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 than is available with respect to domestic banks.
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
Adviser carefully considers these factors when making investments, the
Money Market Portfolio does not limit the amount of its assets which can be
invested in any one type of instrument or in any foreign country.
ILLIQUID INVESTMENTS are investments that cannot be sold or
disposed of in the ordinary course of business at approximately the prices
at which they are valued. Under the supervision of the Board of Trustees,
FMR determines the liquidity of a Portfolio's investments and, through
reports from FMR, the Board monitors investments in illiquid instruments.
In determining the liquidity of each Portfolio's investments, FMR may
consider various factors including (1) the frequency of trades and
quotations, (2) the number of dealers and prospective purchasers in the
marketplace, (3) dealer undertakings to make a market, (4) the nature of
the security (including any demand or tender features) and (5) the nature
of the marketplace for trades (including the ability to assign or offset
the Portfolio's rights and obligations relating to the investment).
Investments currently considered by the Portfolios to be illiquid include
repurchase agreements not entitling the holder to payment of principal and
interest within seven days. Also, for Domestic Money Market Portfolio and
Money Market Portfolio FMR may determine some restricted securities and
time deposits to be illiquid. In the absence of market quotations, illiquid
investments are valued for purposes of monitoring amortized cost valuation
at fair value as determined in good faith by a committee appointed by the
Board of Trustees. If through a change in values, net assets or other
circumstances, a Portfolio were in a position where more than 10% of its
net assets were invested in illiquid securities, it would seek to take
appropriate steps to protect liquidity.
INTERFUND BORROWING PROGRAM. The Portfolios have received
permission from the SEC to lend money to and borrow money from other funds
advised by FMR or its affiliates. Interfund loans and borrowings normally
will extend overnight, but can have a maximum duration of seven days.
Treasury Portfolio, Treasury Portfolio II and Government Portfolio will
participate in this interfund lending program only as borrowers. Each
Portfolio will borrow through the program only when costs are equal to or
lower than the cost of bank loans. Domestic Money Market and Money Market
Portfolio will lend through the program only when the returns are higher
than those available at the same time from other short-term instruments
(such as repurchase agreements). Each Portfolio that may lend will not lend
more than 10% of its net assets to other funds and no Portfolio will borrow
through the program if, after doing so, its total outstanding borrowings
would exceed 15% of total assets. Loans may be called on one day's notice
and a Portfolio may have to borrow from a bank at a higher interest rate if
an interfund loan is called or not renewed. Any delay in repayment to a
lending fund could result in a lost investment opportunity or additional
borrowing costs.
MONEY MARKET refers to the marketplace where short-term, high
quality debt securities are traded, including U.S. government obligations,
commercial paper, certificates of deposit, bankers' acceptances, time
deposits and short-term corporate obligations. Money market instruments may
carry fixed rates of return or have variable or floating interest
rates.
MUNICIPAL OBLIGATIONS are issued to raise money for various
public purposes, including general purpose financing for state and local
governments as well as financing for specific projects or public
facilities. Municipal obligations may be backed by the full taxing power of
a municipality or by the revenues from a specific project or the credit of
a private organization.
REPURCHASE AGREEMENTS. Repurchase agreements are transactions by
which a Portfolio purchases a security and simultaneously commits to resell
that security to the seller at an agreed upon price on an agreed upon date
within a number of days from the date of purchase. The resale price
reflects the purchase price plus an agreed upon incremental amount which is
unrelated to the coupon rate or maturity of the purchased security. A
repurchase agreement involves the obligation of the seller to pay the
agreed upon price, which obligation is in effect secured by the value (at
least equal to the amount of the agreed upon resale price and marked to
market daily) of the underlying security. Each Portfolio may engage in a
repurchase agreement with respect to any type of security in which that
Portfolio is authorized to invest, regardless of the length of time to
maturity. While it does not presently appear possible to eliminate all
risks from these transactions (particularly the possibility of a decline in
the market value of the underlying securities, as well as delays and costs
to the Portfolios in connection with bankruptcy proceedings), it is the
policy of each Portfolio to limit repurchase agreements to parties whose
creditworthiness has been reviewed and found satisfactory by FMR.
RESTRICTED SECURITIES. Domestic Portfolio and Money Market
Portfolio may purchase restricted securities that are not registered for
sale to the general public. Restricted securities generally can be sold in
privately negotiated transactions, pursuant to an exemption from
registration under the Securities Act of 1933, or in a registered public
offering. Where registration is required, a Portfolio may be obligated to
pay all or part of the registration expense and a considerable period may
elapse between the time it decides to seek registration and the time the
fund may be permitted to sell a security under an effective registration
statement. If, during such a period, adverse market conditions were to
develop, the portfolio might obtain a less favorable price than prevailed
when it decided to seek registration of the security.
REVERSE REPURCHASE AGREEMENTS. Each Portfolio, other than
Treasury Portfolio II, may engage in reverse repurchase agreements. Reverse
repurchase agreements are transactions whereby a Portfolio temporarily
transfers possession of a portfolio instrument to another party, such as a
bank or broker-dealer, in return for cash. At the same time, the Portfolio
agrees to repurchase the instrument at an agreed upon price and time. A
Portfolio expects that it will engage in reverse repurchase agreements for
temporary purposes such as to fund redemptions or when it is able to invest
the cash so acquired at a rate higher than the cost of the agreement, which
would increase the income earned by a Portfolio. While a reverse repurchase
agreement is outstanding, the Portfolio will maintain appropriate liquid
assets in a segregated custodial account to cover its obligations under the
agreement. Reverse repurchase agreements may increase the risk of
fluctuation in the market value of a Portfolio's assets or in its yield.
Such transactions may increase fluctuations in the market value of a
Portfolio's assets and may be viewed as a form of leverage. A Portfolio
will enter into reverse repurchase agreements only with parties whose
creditworthiness has been found satisfactory by FMR.
SHORT SALES "AGAINST THE BOX." A Portfolio may sell securities
short when it owns or has the right to obtain securities equivalent in kind
or amount to the securities sold short. Short sales could be used to
protect the net asset value per share of the Portfolio in anticipation of
increased interest rates, without sacrificing the current yield of the
securities sold short. If a Portfolio enters into a short sale against the
box, it will be required to set aside securities equivalent in kind and
amount to the securities sold short (or securities convertible or
exchangeable into such securities) and will be required to hold such
securities while the short sale is outstanding. The Portfolio will incur
transaction costs, including interest expense, in connection with opening,
maintaining, and closing short sales against the box.
STRIPPED GOVERNMENT SECURITIES: Each Portfolio may
purchase U.S. Treasury STRIPS (Separate Trading of Registered Interest and
Principal of Securities), that are created when the coupon payments and the
principal payment are stripped from an outstanding Treasury bond by the
Federal Reserve Bank of New York and sold separately.
TIME DEPOSITS are non-negotiable deposits in a banking
institution earning a specified interest rate over a given period of
time.
VARIABLE OR FLOATING RATE INSTRUMENTS bear variable or floating
interest rates and carry rights that permit holders to demand payment of
the unpaid principal balance plus accrued interest from the issuers or
certain financial intermediaries. Floating rate instruments have interest
rates that change whenever there is a change in a designated base rate,
while variable rate instruments provide for a specified periodic adjustment
in the interest rate. These formulas are designed to result in a market
value for the instrument that approximates its par value.
A Portfolio may invest in variable or floating rate instruments that
ultimately mature in more than 397 days if the Portfolio acquires a right
to sell securities that meets certain requirements set forth in Rule 2a-7.
Variable rate instruments (including instruments subject to a demand
feature) that mature in 397 days or less and U.S. government obligations
with a variable rate of interest reset no less frequently than every 762
days may be deemed to have maturities equal to the period remaining until
the next readjustment of the interest rate. Other variable rate instruments
with demand features may be deemed to have a maturity equal to the longer
of the period remaining until the next readjustment of the interest rate or
the period remaining until the principal amount can be recovered through
demand. A floating rate instrument subject to a demand feature may be
deemed to have a maturity equal to the period remaining until the principal
amount can be recovered through demand.
APPENDIX B
RATINGS
The descriptions that follow are examples of eligible ratings for the
Portfolios. The Portfolios may, however, consider the ratings for other
types of investments and the ratings assigned by other rating organizations
when determining the eligibility of a particular investment.
DESCRIPTION OF MOODY'S INVESTORS SERVICE, INC.'S COMMERCIAL PAPER RATINGS:
PRIME-1 - issuers (or related institutions) have a superior capacity for
repayment of short-term promissory obligations. Prime-1 repayment capacity
will normally be evidenced by the following characteristics:
(bullet) Leading market positions in well established industries.
(bullet) High rates of return on funds employed.
(bullet) Conservative capitalization structures with moderate reliance on
debt and ample asset protection.
(bullet) Broad margins in earnings coverage of fixed financial charges with
high internal cash generation.
(bullet) Well-established access to a range of financial markets and
assured sources of alternate liquidity.
PRIME-2 - issuers (or related supporting institutions) have a strong
capacity for repayment of short-term promissory obligations. This will
normally be evidenced by many of the characteristics cited above but to a
lesser degree. Earnings trends and coverage ratios, while sound, will be
more subject to variation. Capitalization characteristics, while still
appropriate, may be more affected by external conditions. Ample alternate
liquidity is maintained.
DESCRIPTION OF MOODY'S INVESTORS SERVICE, INC.'S CORPORATE BOND RATINGS:
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
issuers.
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 appear somewhat
larger than in Aaa securities.
DESCRIPTION OF STANDARD & POOR'S CORPORATION'S COMMERCIAL PAPER
RATINGS:
A-1 - This designation indicates that the degree of safety regarding timely
payment is either overwhelming or very strong. Those issues determined to
possess overwhelming safety characteristics will be denoted with a plus (+)
sign designation.
A-2 - Capacity for timely payment on issues with this designation is
strong. However, the relative degree of safety is not as high as for issues
designated A-1.
DESCRIPTION OF STANDARD & POOR'S CORPORATION'S CORPORATE BOND RATINGS:
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 debt issues only in small
degree.
FIDELITY INSTITUTIONAL CASH PORTFOLIOS: U.S. TREASURY PORTFOLIO
INVESTMENTS/MARCH 31, 1994
(SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENTS)
ANNUALIZED
YIELD AT
DUE TIME OF PRINCIPAL VALUE MATURITY VALUE
DATE PURCHASE AMOUNT (NOTE 1) AMOUNT (NOTE 1)
Federal Agencies - 1.2%
EXPORT-IMPORT BANK, U.S. - AGENCY COUPONS
4/15/94 3.81% (a) $ 19,000,000 $ 19,000,000
U.S. Treasury Obligations - 48.4%
U.S. TREASURY BILLS - 25.1%
4/7/94 3.35 25,000,000 24,986,500
5/5/94 3.27 20,000,000 19,940,122
5/5/94 3.30 14,000,000 13,957,501
5/5/94 3.31 56,000,000 55,827,847
5/5/94 3.35 18,000,000 17,944,920
5/26/94 3.30 32,000,000 31,841,111
5/26/94 3.35 50,000,000 49,747,942
6/2/94 3.36 35,000,000 34,801,083
6/30/94 3.30 68,000,000 67,456,000
9/29/94 3.92 70,000,000 68,645,285
10/20/94 3.36 20,000,000 19,631,911
404,780,222
U.S. TREASURY NOTES - 23.3%
4/30/94 3.23 18,000,000 18,028,531
5/15/94 3.16 58,000,000 58,255,988
5/15/94 3.22 62,000,000 62,276,139
7/31/94 3.20 30,000,000 30,093,121
8/15/94 3.07 65,000,000 67,242,805
8/15/94 3.15 10,000,000 10,132,684
8/15/94 3.21 20,000,000 20,260,945
8/15/94 3.81 10,000,000 10,323,870
8/15/94 3.85 27,000,000 27,297,769
8/15/94 3.89 25,000,000 25,432,801
8/31/94 3.18 25,000,000 25,096,248
9/30/94 3.22 5,000,000 5,016,762
1/31/95 3.63 15,000,000 15,068,888
374,526,551
TOTAL U.S. TREASURY OBLIGATIONS 779,306,773
MATURITY
AMOUNT
Repurchase Agreements - 50.4%
With Bear Stearns & Co., Inc.:
At 3.58%, dated 3/25/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $153,285,000)
5.125%, 2/28/98 to 3/31/98 $ 145,554,602 145,410,000
With BT Securities Corp.:
At 3.55%, dated 3/31/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $58,600,000)
10.75%, 8/15/05 $ 75,029,583 $ 75,000,000
With Chemical Securities, Inc.:
At 3.55%, dated 3/31/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $77,275,000)
7.125%, 2/15/23 75,029,583 75,000,000
With Deutsche Bank Government Securities, Inc.:
At 3.55%, dated 3/31/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $205,820,000)
6/30/94 200,078,889 200,000,000
With Goldman, Sachs & Co.:
At 3.82%, dated 3/22/94 due 6/20/94:
U.S. Treasury Obligations
(principal amount $73,906,000)
0% to 8.75%,
7/28/94 to 5/15/16 73,697,150 73,000,000
With Morgan Stanley & Co., Inc.:
At 3.70%, dated 3/31/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $52,956,000)
3.875% to 5.125%,
5/31/94 to 2/28/95 52,021,378 52,000,000
With Nikko Securities Co. International, Inc.:
At 3.75%, dated 3/31/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $73,555,000)
4.625%, 12/31/94 73,030,417 73,000,000
In a joint trading account
(U.S. Treasury Obligations)
dated 3/31/94, due 4/4/94
(Note 2) At 3.58% 116,552,373 116,506,000
TOTAL REPURCHASE AGREEMENTS 809,916,000
TOTAL INVESTMENTS - 100% $ 1,608,222,773
Total Cost for Income Tax Purposes - $1,608,222,773
LEGEND:
(e) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
INCOME TAX INFORMATION:
At March 31,1994, the fund had a capital loss carryforward of approximately
$355,000 of which $29,000, $109,000, $122,000 and $95,000 will expire on
March 31, 1996, 1997, 1999 and 2002, respectively.
For the period ended March 31, 1994, approximately 40% of the fund's
dividends to shareholders was derived from interest on U.S. Government
obligations.
Statement of Assets and Liabilities
March 31, 1994
ASSETS
Investment in securities, at value $ 1,608,222,773
(including repurchase
agreements of $809,916,000)
(Notes 1 and 2) - See
accompanying schedule
Interest receivable 6,229,552
Receivable from investment 67,354
adviser for expense reductions
(Note 5)
TOTAL ASSETS 1,614,519,679
LIABILITIES
Dividends payable $ 2,245,296
Accrued management fee 305,551
Other payables and accrued 91,575
expenses
TOTAL LIABILITIES 2,642,422
NET ASSETS $ 1,611,877,257
Net Assets consist of (Note 1):
Paid in capital $ 1,612,231,931
Accumulated net realized gain (354,674)
(loss) on investments
NET ASSETS, for 1,612,224,343 $ 1,611,877,257
shares outstanding
NET ASSET VALUE, offering price $1.00
and redemption price per share
($1,611,877,257(divided by)
1,612,224,343 shares)
Statement of Operations
Year Ended March 31, 1994
INTEREST INCOME (Note 2) $ 60,917,710
EXPENSES
Management fee (Note 4) $ 3,796,042
Transfer agent fees (Note 4) 150,635
Accounting fees and expenses 192,236
(Note 4)
Non-interested trustees' 10,775
compensation
Custodian fees and expenses 79,762
Registration fees 6,659
Audit 36,377
Legal 22,135
Miscellaneous 25,426
Total expenses before 4,320,047
reductions
Expense reductions (Note 5) (903,610) 3,416,437
NET INTEREST INCOME 57,501,273
NET REALIZED GAIN (LOSS) ON (94,848)
INVESTMENTS (NOTE 1)
NET INCREASE IN NET ASSETS $ 57,406,425
RESULTING FROM OPERATIONS
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
<S> <C> <C>
YEARS ENDED MARCH 31,
1994 1993
INCREASE (DECREASE) IN NET ASSETS
Operations $ 57,501,273 $ 92,723,217
Net interest income
Net realized gain (loss) on investments (94,848) 86,794
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS 57,406,425 92,810,011
Dividends to shareholders from net interest income (57,501,273) (92,723,217)
Share transactions at net asset value of $1.00 per share 11,024,606,904 12,988,431,736
Proceeds from sales of shares
Reinvestment of dividends from net interest income 29,704,546 43,620,453
Cost of shares redeemed (11,479,144,890) (13,624,405,282)
Net increase (decrease) in net assets and shares resulting
from share transactions (424,833,440) (592,353,093)
TOTAL INCREASE (DECREASE) IN NET ASSETS (424,928,288) (592,266,299)
NET ASSETS
Beginning of period 2,036,805,545 2,629,071,844
End of period $ 1,611,877,257 $ 2,036,805,545
</TABLE>
FIDELITY INSTITUTIONAL CASH PORTFOLIOS: U.S. TREASURY PORTFOLIO II
INVESTMENTS/MARCH 31, 1994
(SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENTS)
ANNUALIZED
YIELD AT
DUE TIME OF PRINCIPAL VALUE MATURITY VALUE
DATE PURCHASE AMOUNT (NOTE 1) AMOUNT (NOTE 1)
U.S. Treasury Obligations - 35.1%
U.S. TREASURY BILLS - 18.5%
4/7/94 3.35% $ 55,000,000 $ 54,970,300
5/5/94 3.27 40,000,000 39,880,244
5/5/94 3.30 135,000,000 134,588,080
5/19/94 3.32 32,500,000 32,358,314
5/26/94 3.35 34,000,000 33,828,601
5/26/94 3.30 169,000,000 168,160,868
6/2/94 3.36 125,000,000 124,289,583
6/30/94 3.30 165,000,000 163,680,000
9/29/94 3.92 40,000,000 39,225,878
10/20/94 3.36 53,000,000 52,024,564
843,006,432
U.S. TREASURY NOTES - 16.6%
4/30/94 3.23 42,280,000 42,347,017
5/15/94 3.21 50,000,000 50,222,838
5/15/94 3.37 100,000,000 100,429,191
5/31/94 3.23 23,605,000 23,673,568
7/31/94 3.20 40,000,000 40,124,161
8/15/94 3.07 135,000,000 139,658,133
8/15/94 3.08 108,000,000 111,722,446
8/15/94 3.15 53,500,000 54,209,860
8/15/94 3.78 58,000,000 59,029,588
8/15/94 3.82 5,388,000 5,447,944
8/15/94 3.85 63,000,000 63,694,794
1/31/95 3.63 65,500,000 65,800,814
756,360,354
TOTAL U.S. TREASURY OBLIGATIONS 1,599,366,786
MATURITY
AMOUNT
Repurchase Agreements - 64.9%
With Barclays de Zoete Wedd Government Securities, Inc.:
At 3.65%, dated 3/31/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $78,140,000)
7.875% to 12.375%,
4/15/98 to 5/15/04 $ 100,040,556 100,000,000
With Chemical Securities, Inc.:
At 3.55%, dated 3/31/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $200,055,000)
7% to 7.125%,
9/30/96 to 2/15/23 200,078,889 200,000,000
With Daiwa Securities Co., Ltd.:
At 3.65%, dated 3/31/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $100,625,000)
0% to 10.75%,
6/2/94 to 8/15/05 $ 100,040,556 $ 100,000,000
With Deutsche Bank Government Securities, Inc.:
At 3.55%, dated 3/31/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $205,820,000)
6/30/94 200,078,889 200,000,000
With Donaldson, Lufkin & Jenrette Securities Corp.:
At 3.62%, dated 3/31/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $95,183,000)
0% to 10.75%,
6/2/94 to 5/15/21 100,040,222 100,000,000
With Goldman, Sachs & Co.:
At 3.52%, dated 3/31/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $97,344,000)
5.125% to 7.875%,
11/15/96 to 7/31/96 100,039,111 100,000,000
At 3.82%, dated 3/22/94 due 6/20/94:
U.S. Treasury Obligations
(principal amount $195,360,000)
0% to 12.75%,
7/14/94 to 5/15/21 213,015,050 211,000,000
With Kidder Peabody & Co., Inc.
At 3.60%, dated 3/31/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $95,102,000)
7.50% to 8.50%,
1/31/96 to 7/15/97 100,040,000 100,000,000
With Morgan Stanley & Co., Inc.:
At 3.48%, dated 3/31/94 due 4/1/94:
U.S. Treasury Obligations
(principal amount $10,260,000)
0% to 8%,
9/22/94 to 10/15/96 10,003,867 10,000,000
At 3.70%, dated 3/31/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $128,205,000)
4.25% to 5.125%,
5/31/94 to 11/30/94 128,052,622 128,000,000
MATURITY VALUE
AMOUNT (NOTE 1)
REPURCHASE AGREEMENTS - CONTINUED
With Nikko Securities Co. International, Inc.:
At 3.75%, dated 3/31/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $183,465,000)
6% to 7.875%,
12/31/97 to 5/15/01 $ 193,080,417 $ 193,000,000
With Nomura Securities International, Inc.:
At 3.625%, dated 3/31/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $95,959,000)
0% to 13.875%,
6/2/94 to 2/15/23 100,040,278 100,000,000
With Prudential Securities, Inc.:
At 3.55%, dated 3/31/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $203,425,000)
5.125% to 7.875%,
1/15/98 to 5/31/98 200,078,889 200,000,000
In a joint trading account
(U.S. Treasury Obligations)
dated 3/31/94, due 4/4/94
(Notes 2 and 3)
At 3.55% 831,328,132 831,000,000
At 3.63% 381,338,745 381,185,000
TOTAL REPURCHASE AGREEMENTS 2,954,185,000
TOTAL INVESTMENTS - 100% $ 4,553,551,786
Total Cost for Income Tax Purposes - $4,553,551,786
INCOME TAX INFORMATION:
At March 31, 1994, the fund had a capital loss carryforward of
approximately $235,000 of which $21,000 and $214,000 will expire on March
31, 1999 and 2002, respectively.
For the period ended March 31, 1994, approximately 39% of the fund's
dividends to shareholders was derived from interest on U.S. Government
obligations.
Statement of Assets and Liabilities
<TABLE>
<CAPTION>
<S> <C> <C>
March 31, 1994
ASSETS
Investment in securities, at value (including repurchase agreements of $2,954,185,000) (Notes 1 and 2) $ 4,553,551,786
- - - See accompanying schedule
Cash 28,835
Interest receivable 12,051,981
Receivable from investment adviser for expense reductions (Note 5) 194,398
TOTAL ASSETS 4,565,827,000
LIABILITIES
Dividends payable $ 7,794,463
Accrued management fee 721,085
Other payables and accrued expenses 217,935
TOTAL LIABILITIES 8,733,483
NET ASSETS $ 4,557,093,517
Net Assets consist of (Note 1):
Paid in capital $ 4,557,328,499
Accumulated net realized gain (loss) on investments (234,982)
NET ASSETS $ 4,557,093,517
CALCULATION OF MAXIMUM $1.00
OFFERING PRICE
CLASS A:
NET ASSET VALUE, offering price
and redemption price per share
($4,551,918,095 (divided by)
4,552,015,940 shares)
CLASS B: $1.00
NET ASSET VALUE, offering price
and redemption price per share
($5,175,422 (divided by) 5,175,534
shares)
</TABLE>
Statement of Operations
<TABLE>
<CAPTION>
<S> <C> <C>
Year Ended March 31, 1994
INTEREST INCOME $ 157,072,117
EXPENSES
Management fee (Note 4) $ 9,834,015
Transfer agent fees (Note 4) 1,101,750
Class A
Class B 113
Distribution fees - 2,065
Class B (Note 4)
Accounting fees and expenses (Note 4) 419,147
Non-interested trustees' compensation 39,797
Custodian fees and expenses 173,073
Registration fees - Class A 31,761
Registration fees - Class B 125
Audit 78,302
Legal 58,636
Miscellaneous 70,918
Total expenses before 11,809,702
reductions
Expense reductions (2,956,802) 8,852,900
(Note 5)
NET INTEREST INCOME 148,219,217
NET REALIZED GAIN (LOSS) ON (214,389)
INVESTMENTS (NOTE 1)
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 148,004,828
</TABLE>
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
<S> <C> <C>
YEARS ENDED MARCH 31,
1994 1993
INCREASE (DECREASE) IN NET ASSETS
Operations $ 148,219,217 $ 237,410,019
Net interest income
Net realized gain (loss) on investments (214,389) 7,178
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS 148,004,828 237,417,197
Distributions to shareholders from:
Net interest income
Class A (148,201,826) (237,410,019)
Class B (17,391) -
Share transactions - net increase (decrease) at net asset
value of $1.00 per share (Note 6) (1,032,355,168) 112,804,252
TOTAL INCREASE (DECREASE) IN NET ASSETS (1,032,569,557) 112,811,430
NET ASSETS
Beginning of period 5,589,663,074 5,476,851,644
End of period $ 4,557,093,517 $ 5,589,663,074
</TABLE>
FIDELITY INSTITUTIONAL CASH PORTFOLIOS: U.S. GOVERNMENT PORTFOLIO
INVESTMENTS/MARCH 31, 1994
(SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENTS)
ANNUALIZED
YIELD AT
DUE TIME OF PRINCIPAL VALUE MATURITY VALUE
DATE PURCHASE AMOUNT (NOTE 1) AMOUNT (NOTE 1)
Federal Agencies - 53.0%
EXPORT-IMPORT BANK, U.S. - AGENCY COUPONS - 1.1%
4/15/94 3.81% (a) $ 43,204,550 $ 43,204,550
FEDERAL FARM CREDIT BANK - AGENCY COUPONS - 2.8%
10/3/94 3.36 58,000,000 58,006,846
10/3/94 4.13 (b) 48,000,000 47,970,000
105,976,846
FEDERAL HOME LOAN BANK - DISCOUNT NOTES - 1.2%
6/16/94 3.37 45,000,000 44,992,483
FEDERAL HOME LOAN MORTGAGE CORP. - DISCOUNT NOTES - 1.5%
11/28/94 4.18 60,000,000 58,373,250
FEDERAL NATIONAL MORTGAGE ASSOC. - AGENCY COUPONS - 5.6%
4/4/94 3.60 (a) 190,000,000 190,000,000
5/10/94 3.32 10,365,000 10,428,512
6/30/94 3.29 15,000,000 15,004,305
215,432,817
FEDERAL NATIONAL MORTGAGE ASSOC. - DISCOUNT NOTES - 31.8%
4/4/94 3.47 285,000,000 284,917,588
6/7/94 3.37 200,000,000 198,767,944
6/27/94 3.34 214,000,000 212,303,693
6/30/94 3.31 40,000,000 39,678,000
8/1/94 3.20 150,000,000 148,398,750
9/8/94 3.30 2,000,000 1,971,288
9/22/94 3.33 68,490,000 67,410,826
9/23/94 4.01 40,000,000 39,237,777
9/26/94 3.30 100,000,000 98,402,944
9/30/94 4.04 21,835,000 21,398,968
10/25/94 3.40 103,015,000 101,054,367
1,213,542,145
STUDENT LOAN MARKETING ASSOCIATION - AGENCY COUPONS - 9.0%
4/5/94 3.88 (a) 51,000,000 51,060,157
4/5/94 3.90 (a) 170,000,000 170,000,000
6/30/94 3.16 21,000,000 21,007,840
7/1/94 3.74 (a) 100,000,000 100,000,000
342,067,997
TOTAL FEDERAL AGENCIES 2,023,590,088
U.S. Treasury Obligations - 10.2%
U.S. TREASURY BILLS
4/7/94 3.35 115,500,000 115,437,630
5/5/94 3.35 88,000,000 87,730,720
6/2/94 3.36 84,000,000 83,522,600
6/2/94 3.47 52,000,000 51,699,989
10/20/94 3.36 50,000,000 49,079,778
TOTAL U.S. TREASURY OBLIGATIONS 387,470,717
Repurchase Agreements - 36.8%
With Bear Stearns & Co., Inc.:
At 3.58%, dated 3/25/94 due 4/4/94:
U.S. Treasury Obligations
(principal amount $251,255,000)
0% to 7.75%,
12/15/94 to 2/28/98 $ 246,269,658 $ 246,025,000
With First Boston Corporation:
At 3.65%, dated 3/25/94 due 4/4/94:
U.S. Government Obligations
(principal amount $354,619,483)
3.856% to 10%,
4/1/99 to 9/1/23 176,178,444 176,000,000
With Goldman, Sachs & Co.:
At 3.82%, dated 3/22/94 due 6/20/94:
U.S. Treasury Obligations
(principal amount $169,531,000)
0% to 14%,
8/18/94 to 8/15/15 179,699,900 178,000,000
With Kidder Peabody & Co., Inc.
At 3.72%, dated 3/28/94 due 4/4/94:
U.S. Government Obligations
(principal amount $163,962,898)
7.05% to 9.461%,
12/1/27 to 1/1/29 160,115,733 160,000,000
With Merrill Lynch Government Securities, Inc.:
At 3.625%, dated 3/28/94 due 4/4/94:
U.S. Government Obligations
(principal amount $81,329,747)
5.625%, 12/1/30 80,056,389 80,000,000
With Paine Webber, Inc.:
At 3.75%, dated 3/28/94 due 4/4/94:
U.S. Government Obligations
(principal amount $80,028,760)
3.793% to 4.457%,
12/1/23 to 1/1/24 80,058,333 80,000,000
In a joint trading account (Note 2)
(U.S. Treasury Obligations)
dated 3/31/94, due 4/4/94
At 3.58% 56,516,486 56,494,000
At 3.61% 52,261,956 52,241,000
(U.S. Government Obligations)
dated 3/31/94, due 4/4/94
At 3.74% 375,155,777 375,000,000
TOTAL REPURCHASE AGREEMENTS 1,403,760,000
TOTAL INVESTMENTS - 100% $ 3,814,820,805
Total Cost for Income Tax Purposes - $3,814,820,805
LEGEND:
(f) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
(b) Security purchased on a delayed delivery basis.
INCOME TAX INFORMATION:
At March 31,1994, the fund had a capital loss carryforward of approximately
$283,000 of which $40,000 and $243,000 will expire on March 31, 2001 and
2002, respectively.
For the period ended March 31, 1994, approximately 36% of the fund's
dividends to shareholders was derived from interest on U.S. Government
obligations.
Statement of Assets and Liabilities
<TABLE>
<CAPTION>
<S> <C> <C>
March 31, 1994
ASSETS
Investment in securities, at value (including repurchase agreements of $1,403,760,000) (Notes 1 and 2) $ 3,814,820,805
- - - See accompanying schedule
Interest receivable 5,461,499
Receivable from investment adviser for expense reductions (Note 5) 236,051
TOTAL ASSETS 3,820,518,355
LIABILITIES
Payable for investments $ 47,970,000
purchased
Share transactions in process 19,997
Dividends payable 7,056,366
Accrued management fee 719,971
Other payables and accrued expenses 207,811
TOTAL LIABILITIES 55,974,145
NET ASSETS $ 3,764,544,210
Net Assets consist of (Note 1):
Paid in capital $ 3,764,827,389
Accumulated net realized gain (loss) on investments (283,179)
NET ASSETS, for 3,764,323,957 shares outstanding $ 3,764,544,210
NET ASSET VALUE, offering price and redemption price per share ($3,764,544,210 (divided by) 3,764,323,957 $1.00
shares)
</TABLE>
Statement of Operations
<TABLE>
<CAPTION>
<S> <C> <C>
Year Ended March 31, 1994
INTEREST INCOME (Note 2) $ 157,127,358
EXPENSES
Management fee (Note 4) $ 9,660,519
Transfer agent fees (Note 4) 878,411
Accounting fees and expenses (Note 4) 412,411
Non-interested trustees' compensation 32,776
Custodian fees and expenses 148,118
Registration fees 43,916
Audit 65,400
Legal 54,891
Miscellaneous 63,612
Total expenses before 11,360,054
reductions
Expense reductions (2,665,587) 8,694,467
(Note 5)
NET INTEREST INCOME 148,432,891
NET REALIZED GAIN (LOSS) ON (243,492)
INVESTMENTS (NOTE 1)
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 148,189,399
</TABLE>
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
<S> <C> <C>
YEARS ENDED MARCH 31,
1994 1993
INCREASE (DECREASE) IN NET ASSETS
Operations $ 148,432,891 $ 220,852,069
Net interest income
Net realized gain (loss) on investments (243,492) (39,687)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS 148,189,399 220,812,382
Dividends to shareholders from net interest income (148,432,891) (220,852,069)
Share transactions at net asset value of $1.00 per share 33,376,241,019 43,021,000,441
Proceeds from sales of shares
Reinvestment of dividends from net interest income 54,284,929 69,113,643
Cost of shares redeemed (35,351,904,003) (42,007,689,675)
Net increase (decrease) in net assets and shares resulting
from share transactions (1,921,378,055) 1,082,424,409
TOTAL INCREASE (DECREASE) IN NET ASSETS (1,921,621,547) 1,082,384,722
NET ASSETS
Beginning of period 5,686,165,757 4,603,781,035
End of period $ 3,764,544,210 $ 5,686,165,757
</TABLE>
FIDELITY INSTITUTIONAL CASH PORTFOLIOS: DOMESTIC MONEY MARKET PORTFOLIO
INVESTMENTS/MARCH 31, 1994
(SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENTS)
ANNUALIZED ANNUALIZED
YIELD AT YIELD AT
DUE TIME OF PRINCIPAL VALUE DUE TIME OF PRINCIPAL VALUE
DATE PURCHASE AMOUNT (NOTE 1) DATE PURCHASE AMOUNT (NOTE 1)
Bankers' Acceptances - 6.6%
Bank of New York
4/28/94 3.44% $ 8,000,000 $ 7,979,480
Chase Manhattan Bank
4/21/94 3.12 6,500,000 6,488,806
5/2/94 3.69 3,897,671 3,885,321
5/3/94 3.69 4,718,760 4,703,325
5/10/94 3.72 5,154,654 5,133,993
Trust Company Bank
4/11/94 3.13 10,000,000 9,991,361
U.S. Bank of Washington
7/11/94 3.27 5,000,000 4,954,830
TOTAL BANKERS' ACCEPTANCES 43,137,116
Certificates of Deposit - 6.1%
Harris Trust & Savings Bank
6/3/94 3.75 10,000,000 10,000,000
Old Kent Bank & Trust Company
4/19/94 3.57 15,000,000 15,000,000
5/31/94 3.75 10,000,000 10,000,000
Old Kent Bank - Southwest
7/25/94 3.28 5,000,000 5,000,000
TOTAL CERTIFICATES OF DEPOSIT 40,000,000
Commercial Paper - 49.4%
American General Finance Corporation
5/16/94 3.67 5,000,000 4,977,187
Bear Stearns Companies Inc.
4/22/94 3.47 10,000,000 9,979,875
4/25/94 3.47 15,000,000 14,965,501
Beneficial Corporation
5/4/94 3.20 10,000,000 9,970,850
5/6/94 3.21 10,000,000 9,969,083
CIESCO, L.P.
5/20/94 3.53 5,000,000 4,976,181
CIT Group Holdings, Inc.
4/21/94 3.29 5,000,000 4,990,945
4/27/94 3.12 5,000,000 4,988,805
Commercial Credit Company
4/18/94 3.43 5,000,000 4,991,948
5/13/94 3.68 5,000,000 4,978,650
CoreStates Capital Corp.
4/8/94 3.62 (a) 5,000,000 5,000,000
Corporate Asset Funding Company, Inc.
4/8/94 3.12 7,700,000 7,695,359
5/5/94 3.13 4,300,000 4,287,410
Corporate Receivables Corp.
4/7/94 3.46% $ 6,000,000 $ 5,996,550
Dean Witter, Discover & Co.
4/15/94 3.15 5,000,000 4,993,914
5/24/94 3.76 6,000,000 5,966,963
Deere & Company
5/11/94 3.67 5,000,000 4,979,722
Ford Motor Credit Corporation
4/4/94 3.22 4,000,000 3,998,933
4/12/94 3.53 10,000,000 9,989,245
General Electric Capital Services Inc.
7/22/94 3.30 5,000,000 4,949,445
General Motors Acceptance Corporation
5/11/94 3.80 2,000,000 1,991,600
5/17/94 3.80 10,000,000 9,951,700
5/23/94 3.82 10,000,000 9,945,111
6/27/94 4.00 6,000,000 5,942,580
Goldman Sachs Group, L.P. (The)
4/26/94 3.12 5,000,000 4,989,236
5/20/94 3.19 10,000,000 9,957,125
Hewlett-Packard Company
4/13/94 3.46 10,000,000 9,988,500
IBM Credit Corporation
5/16/94 3.74 5,000,000 4,976,750
J.C. Penney Funding Corporation
4/18/94 3.52 5,000,000 4,991,736
Merck & Company, Inc.
5/27/94 3.40 5,000,000 4,973,944
Merrill Lynch & Co., Inc.
4/14/94 3.14 10,000,000 9,988,733
4/20/94 3.14 5,000,000 4,991,767
Morgan Stanley Group, Inc.
4/29/94 3.52 5,000,000 4,986,389
New Center Asset Trust
4/29/94 3.62 5,000,000 4,986,000
5/9/94 3.77 6,000,000 5,976,250
Norfolk Funding Corp.
4/19/94 3.12 1,737,000 1,734,307
PHH Corporation
4/18/94 3.63 10,000,000 9,982,905
Preferred Receivables Funding Corporation
4/6/94 3.54 10,000,000 9,995,097
4/7/94 3.54 10,000,000 9,994,116
4/21/94 3.61 5,000,000 4,990,000
ANNUALIZED ANNUALIZED
YIELD AT YIELD AT
DUE TIME OF PRINCIPAL VALUE DUE TIME OF PRINCIPAL VALUE
DATE PURCHASE AMOUNT (NOTE 1) DATE PURCHASE AMOUNT (NOTE 1)
Commercial Paper - CONTINUED
Texaco Inc.
4/11/94 3.61% $ 8,000,000 $ 7,992,000
U.S. Leasing International, Inc.
4/25/94 3.58 7,000,000 6,983,341
4/26/94 3.70 10,000,000 9,974,444
5/23/94 3.72 15,000,000 14,919,833
Weyerhaeuser Company
4/12/94 3.54 7,108,000 7,100,333
Whirlpool Financial Corporation
4/5/94 3.61 5,000,000 4,998,000
4/20/94 3.63 5,000,000 4,990,448
TOTAL COMMERCIAL PAPER 324,938,811
Federal Agencies - 8.8%
FEDERAL FARM CREDIT BANK - DISCOUNT NOTES - 3.3%
4/5/94 3.12 13,970,000 13,965,188
5/6/94 3.41 6,000,000 5,980,225
5/10/94 3.42 1,900,000 1,893,022
21,838,435
FEDERAL HOME LOAN BANK - DISCOUNT NOTES - 2.3%
6/16/94 3.37 7,000,000 6,998,831
8/29/94 3.97 8,000,000 7,870,000
14,868,831
FEDERAL NATIONAL MORTGAGE ASSOC. - DISCOUNT NOTES - 1.7%
5/12/94 3.42 1,370,000 1,364,712
6/30/94 3.23 10,000,000 9,920,250
11,284,962
STUDENT LOAN MARKETING ASSOCIATION - AGENCY COUPONS - 1.5%
4/5/94 3.83 (a) 10,000,000 10,000,000
TOTAL FEDERAL AGENCIES 57,992,228
Bank Notes (a) - 1.5%
Bank of New York
6/6/94 3.80 10,000,000 10,000,000
Medium-Term Notes (a) - 6.6%
Bank One, Milwaukee, N.A.
4/4/94 3.55 5,000,000 4,995,397
CIESCO, L.P.
6/24/94 3.66 10,000,000 10,000,000
General Motors Acceptance Corporation
5/7/94 3.48 6,000,000 6,000,000
Goldman Sachs Group, L.P. (The) (b)
6/16/94 3.46% $ 7,500,000 $ 7,500,000
9/1/94 3.46 8,000,000 8,000,000
Norwest Corporation
9/15/94 3.89 7,000,000 7,000,000
TOTAL MEDIUM-TERM NOTES 43,495,397
Short-Term Notes (a) - 11.8%
CSA Funding (C)
4/8/94 3.90 10,000,000 10,000,000
J.P. Morgan Securities
4/4/94 3.94 14,000,000 14,000,000
4/4/94 3.96 8,000,000 8,000,000
Morgan Stanley Group, Inc.
4/4/94 3.89 10,000,000 10,000,000
Norwest Corporation
4/4/94 3.69 9,000,000 9,000,000
SMM Trust Company (1993-E) (c)
4/13/94 3.30 5,000,000 5,000,000
SMM Trust Company (1993-F) (c)
5/15/94 3.60 2,000,000 2,000,000
SMM Trust Company (1994-A) (c)
6/18/94 3.92 20,000,000 20,000,000
TOTAL SHORT-TERM NOTES 78,000,000
MATURITY
AMOUNT
Repurchase Agreements - 9.2%
With Goldman, Sachs & Co.
At 3.70%, dated 3/29/94 due 4/4/94
(U.S. Treasury Obligations)
(principal amount $20,107,489)
5% to 9.75%,
11/1/00 to 11/1/26 $ 10,006,167 10,000,000
In a joint trading account
(U.S. Treasury Obligations)
dated 3/31/94, due 4/4/94
(Note 2) At 3.61% 50,345,187 50,325,000
TOTAL REPURCHASE AGREEMENTS 60,325,000
TOTAL INVESTMENTS - 100% $ 657,888,552
Total Cost for Income Tax Purposes - $657,888,552
LEGEND:
(a) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
(b) Security exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At the period
end, the value of these securities amounted to $15,500,000 or 2.4% of net
assets.
(g) Restricted securities - Investment in securities not registered under
the Securities Act of 1933 (see Note 2 of Notes to Financial Statements).
Additional information on each holding is as follows:
ACQUISITION ACQUISITION
SECURITY DATE COST
SMM Trust Company:
(1993-E), 3.30% 4/13/94 1/13/94 $ 5,000,000
(1993-F), 3.60% 5/15/94 11/15/93 $ 2,000,000
(1994-A), 3.92% 6/18/94 3/17/94 $ 20,000,000
INCOME TAX INFORMATION:
At March 31, 1994, the fund had a capital loss carryforward of
approximately $49,000 which will expire on March 31, 2001.
For the period ended March 31, 1994, approximately 4% of the fund's
dividends to shareholders was derived from interest on U.S. Government
obligations.
Statement of Assets and Liabilities
<TABLE>
<CAPTION>
<S> <C> <C>
March 31, 1994
ASSETS
Investment in securities, at value (including repurchase agreements of $60,325,000) (Notes 1 and 2) - $ 657,888,552
See accompanying schedule
Cash 32,268
Interest receivable 667,429
Receivable from investment adviser for expense reductions (Note 5) 55,471
TOTAL ASSETS 658,643,720
LIABILITIES
Dividends payable $ 1,485,693
Accrued management fee 116,830
Other payables and accrued expenses 65,150
TOTAL LIABILITIES 1,667,673
NET ASSETS $ 656,976,047
Net Assets consist of (Note 1):
Paid in capital $ 657,025,071
Accumulated net realized gain (loss) on investments (49,024)
NET ASSETS, for 657,009,441 shares outstanding $ 656,976,047
NET ASSET VALUE, offering price and redemption price per share ($656,976,047 (divided by) 657,009,441 shares) $1.00
</TABLE>
Statement of Operations
<TABLE>
<CAPTION>
<S> <C> <C>
Year Ended March 31, 1994
INTEREST INCOME $ 24,916,686
EXPENSES
Management fee (Note 4) $ 1,525,574
Transfer agent fees (Note 4) 262,203
Accounting fees and expenses (Note 4) 107,464
Non-interested trustees' compensation 4,626
Custodian fees and expenses 76,513
Registration fees 2,355
Audit 14,434
Legal 8,715
Miscellaneous 9,683
Total expenses before 2,011,567
reductions
Expense reductions (638,552) 1,373,015
(Note 5)
NET INTEREST INCOME 23,543,671
NET REALIZED GAIN (LOSS) ON 1,208
INVESTMENTS (NOTE 1)
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 23,544,879
</TABLE>
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
<S> <C> <C>
YEARS ENDED MARCH 31,
1994 1993
INCREASE (DECREASE) IN NET ASSETS
Operations $ 23,543,671 $ 26,374,938
Net interest income
Net realized gain (loss) on investments 1,208 (50,232)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS 23,544,879 26,324,706
Dividends to shareholders from net interest income (23,543,671) (26,374,938)
Share transactions at net asset value of $1.00 per share 6,042,925,540 4,699,841,350
Proceeds from sales of shares
Reinvestment of dividends from net interest income 6,177,168 7,989,482
Cost of shares redeemed (6,196,482,006) (4,462,153,962)
Net increase (decrease) in net assets and shares resulting
from share transactions (147,379,298) 245,676,870
TOTAL INCREASE (DECREASE) IN NET ASSETS (147,378,090) 245,626,638
NET ASSETS
Beginning of period 804,354,137 558,727,499
End of period $ 656,976,047 $ 804,354,137
</TABLE>
FIDELITY INSTITUTIONAL CASH PORTFOLIOS: MONEY MARKET PORTFOLIO
INVESTMENTS/MARCH 31, 1994
(SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENTS)
ANNUALIZED ANNUALIZED
YIELD AT YIELD AT
DUE TIME OF PRINCIPAL VALUE DUE TIME OF PRINCIPAL VALUE
DATE PURCHASE AMOUNT (NOTE 1) DATE PURCHASE AMOUNT (NOTE 1)
Certificates of Deposit - 11.2%
NEW YORK BRANCH, YANKEE DOLLAR, FOREIGN BANKS - 8.2%
Fuji Bank, Ltd.
5/3/94 3.77% $ 25,000,000 $ 24,997,324
5/9/94 3.75 40,000,000 40,000,000
Mitsubishi Bank, Ltd.
4/4/94 3.25 25,000,000 25,000,000
National Bank of Canada
5/5/94 3.30 40,000,000 40,000,000
Societe Generale
4/25/94 3.43 50,000,000 50,000,000
6/1/94 3.75 75,000,000 75,000,000
6/9/94 3.73 15,000,000 14,994,144
269,991,468
LONDON BRANCH, EURODOLLAR, FOREIGN BANKS - 3.0%
Banco Bilbao Vizcaya, S.A.
8/11/94 3.90 4,000,000 3,995,857
8/11/94 3.91 4,000,000 3,995,713
Bank of Tokyo
4/29/94 3.25 50,000,000 49,997,254
Sumitomo Bank, Ltd.
4/27/94 3.43 25,000,000 24,998,924
4/27/94 3.50 15,000,000 14,998,781
97,986,529
TOTAL CERTIFICATES OF DEPOSIT 367,977,997
Commercial Paper - 29.8%
ABN-AMRO North America, N.V.
6/3/94 3.54 40,000,000 39,755,000
6/8/94 3.54 30,000,000 29,801,667
Budget Funding Corporation
4/27/94 3.68 30,000,000 29,920,483
Concord Leasing, Inc. (LOC Hong Kong & Shanghai Banking Corp.)
5/3/94 3.48 21,500,000 21,434,641
Den Danske Corporation, Inc.
4/4/94 3.36 50,000,000 49,986,125
5/12/94 3.70 8,000,000 7,966,562
6/30/94 3.79 25,000,000 24,766,250
Dresdner U.S. Finance Inc.
8/24/94 3.85 50,000,000 49,238,750
8/29/94 3.82 25,000,000 24,609,376
Ford Motor Credit Corporation
9/6/94 4.08 25,000,000 24,561,111
GTE Corporation
4/6/94 3.66 31,000,000 30,984,285
General Electric Capital Corporation
4/18/94 3.52% $ 25,000,000 $ 24,958,680
General Motors Acceptance Corporation
5/16/94 3.80 65,000,000 64,692,875
6/1/94 3.75 75,000,000 74,527,250
Goldman Sachs Group, L.P. (The)
7/6/94 4.00 35,000,000 34,631,333
HYPO U.S. Finance
4/14/94 3.38 20,000,000 19,975,877
Hanson Finance (UK) PLC
6/6/94 3.85 30,000,000 29,790,450
Household Finance Corporation
4/27/94 3.62 18,000,000 17,953,200
IBM Credit Corporation
5/16/94 3.74 30,000,000 29,860,500
Leeds Permanent Building Society
4/26/94 3.36 50,000,000 49,884,723
Morgan Stanley Group, Inc.
4/25/94 3.52 30,000,000 29,930,000
New Center Asset Trust
5/9/94 3.77 30,000,000 29,881,250
5/10/94 3.77 80,000,000 79,675,000
Republic New York Corp.
4/6/94 3.44 35,000,000 34,983,375
Ridge Capital II (LOC Dai-Ichi Kangyo Bank)
4/11/94 3.65 5,000,000 4,994,944
Sears Credit Corp. (A)
4/11/94 3.64 15,000,000 14,984,876
Sears Credit Corp. (B)
4/12/94 3.64 7,000,000 6,992,235
4/27/94 3.71 50,000,000 49,866,389
Toronto Dominion Holdings USA, Inc.
4/8/94 3.51 25,000,000 24,982,986
Union Bank of Switzerland
4/6/94 3.65 25,000,000 24,987,327
TOTAL COMMERCIAL PAPER 980,577,520
Federal Agencies - 4.9%
FEDERAL NATIONAL MORTGAGE ASSOC. - DISCOUNT NOTES - 4.6%
9/1/94 4.02 25,000,000 24,580,313
9/26/94 3.32 68,000,000 66,907,277
9/30/94 3.33 42,000,000 41,309,917
11/21/94 3.60 20,000,000 19,545,000
152,342,507
ANNUALIZED
YIELD AT
DUE TIME OF PRINCIPAL VALUE MATURITY VALUE
DATE PURCHASE AMOUNT (NOTE 1) AMOUNT (NOTE 1)
FEDERAL AGENCIES - CONTINUED
INTERNATIONAL BANK OF RECONSTRUCTION AND DEVELOPMENT -
DISCOUNT NOTES - 0.3%
12/23/94 3.52% $ 10,000,000 $ 9,748,039
TOTAL FEDERAL AGENCIES 162,090,546
Medium-Term Notes (a) - 17.9%
Abbey National PLC, UK
6/24/94 3.74 30,000,000 30,000,000
Abbey National Treasury Service
9/30/94 3.87 247,000,000 247,000,000
Bank One, Milwaukee, N.A.
4/4/94 3.55 35,000,000 34,967,781
General Motors Acceptance Corporation
5/7/94 3.48 50,000,000 50,000,000
Goldman Sachs Group, L.P. (The) (b)
6/16/94 3.50 56,000,000 56,000,000
9/1/94 3.50 53,000,000 53,000,000
Norwest Corporation
9/15/94 3.89 65,000,000 65,000,000
PHH Corporation
4/4/94 4.00 54,000,000 54,000,000
TOTAL MEDIUM-TERM NOTES 589,967,781
Short-Term Notes (a) - 19.2%
J.P. Morgan Securities
4/4/94 3.94 105,000,000 105,000,000
4/4/94 3.96 63,000,000 63,000,000
Kingdom of Sweden
4/20/94 3.62 40,000,000 40,000,000
6/23/94 3.81 40,000,000 40,000,000
6/23/94 3.94 39,500,000 39,500,000
Morgan Stanley Group, Inc.
4/4/94 3.89 50,000,000 50,000,000
Norwest Corporation
4/4/94 3.69 32,000,000 32,000,000
SMM Trust Company (1993-D) (c)
4/28/94 3.30 23,000,000 23,000,000
SMM Trust Company (1993-E) (c)
4/13/94 3.30 30,000,000 30,000,000
SMM Trust Company (1994-A) (c)
6/18/94 3.92 154,000,000 154,000,000
Swedish National Housing Finance Corp.
5/23/94 3.64 54,000,000 54,000,000
TOTAL SHORT-TERM NOTES 630,500,000
Repurchase Agreements - 17.0%
With Goldman, Sachs & Co.:
At 3.70% dated 3/31/94 due 4/5/94
(U.S. Treasury Obligations)
(principal amount $387,256,546)
5.07% to 9.50%,
1/1/97 to 10/1/23 $ 150,077,083 $ 150,000,000
In a joint trading account
(U.S. Treasury Obligations)
dated 3/31/94, due 4/4/94
(Note 2)
At 3.58% 160,375,809 160,312,000
At 3.61% 150,933,521 150,873,000
At 3.63% 19,871,011 19,863,000
(U.S. Government Obligations)
dated 3/31/94, due 4/4/94
At 3.70% 79,700,752 79,668,000
TOTAL REPURCHASE AGREEMENTS 560,716,000
TOTAL INVESTMENTS - 100% $ 3,291,829,844
Total Cost for Income Tax Purposes - $3,291,829,844
LEGEND:
(a) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
(b) Security exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At the period
end, the value of these securities amounted to $109,000,000 or 3.3% of net
assets.
(h) Restricted securities - Investment in securities not registered under
the Securities Act of 1933 (see Note 2 of Notes to Financial Statements).
Additional information on each holding is as follows:
ACQUISITION ACQUISITION
SECURITY DATE COST
SMM Trust Company:
(1993-D), 3.30% 4/28/94 1/28/94 $ 23,000,000
(1993-E), 3.30% 4/13/94 1/13/93 $ 30,000,000
(1994-A), 3.92% 6/18/94 3/17/94 $ 154,000,000
INCOME TAX INFORMATION:
At March 31, 1994, the fund had a capital loss carryforward of
approximately $1,234,000 of which $336,000 and $898,000 will expire on
March 31, 2001 and 2002, respectively.
Statement of Assets and Liabilities
<TABLE>
<CAPTION>
<S> <C> <C>
March 31, 1994
ASSETS
Investment in securities, at value (including repurchase agreements of $560,716,000) (Notes 1 and 2) - $ 3,291,829,844
See accompanying schedule
Cash 16,429
Interest receivable 6,010,984
Receivable from investment adviser for expense reductions (Note 5) 147,301
TOTAL ASSETS 3,298,004,558
LIABILITIES
Dividends payable $ 7,332,351
Accrued management fee 691,645
Other payables and accrued expenses 240,534
TOTAL LIABILITIES 8,264,530
NET ASSETS $ 3,289,740,028
Net Assets consist of (Note 1):
Paid in capital $ 3,290,974,257
Accumulated net realized gain (loss) on investments (1,234,229)
NET ASSETS $ 3,289,740,028
CALCULATION OF MAXIMUM $1.00
OFFERING PRICE
CLASS A:
NET ASSET VALUE, offering price
and redemption price per share
($3,200,277,483 (divided by)
3,201,455,124 shares)
CLASS B: $1.00
NET ASSET VALUE, offering price
and redemption price per share
($89,462,545 (divided by) 89,495,467
shares)
</TABLE>
Statement of Operations
<TABLE>
<CAPTION>
<S> <C> <C>
Year Ended March 31, 1994
INTEREST INCOME $ 175,572,240
EXPENSES
Management fee (Note 4) $ 10,551,990
Transfer agent fees (Note 4) 515,041
Class A
Class B 1,860
Distribution fees - 40,685
Class B (Note 4)
Accounting fees and expenses (Note 4) 445,362
Non-interested trustees' compensation 60,010
Custodian fees and expenses 225,706
Registration fees - Class B 125
Audit 66,002
Legal 59,016
Miscellaneous 16,363
Total expenses before 11,982,160
reductions
Expense reductions (2,444,993) 9,537,167
(Note 5)
NET INTEREST INCOME 166,035,073
NET REALIZED GAIN (LOSS) ON (897,770)
INVESTMENTS (NOTE 1)
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 165,137,303
</TABLE>
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
<S> <C> <C>
YEARS ENDED MARCH 31,
1994 1993
INCREASE (DECREASE) IN NET ASSETS
Operations $ 166,035,073 $ 176,149,858
Net interest income
Net realized gain (loss) on investments (897,770) 4,613,541
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 165,137,303 180,763,399
Distributions to shareholders from:
Net interest income
Class A (165,655,489) (176,149,858)
Class B (379,584) -
Share transactions - net increase (decrease) at net asset
value of $1.00 per share (Note 6) (1,042,357,311) 337,986,473
TOTAL INCREASE (DECREASE) IN NET ASSETS (1,043,255,081) 342,600,014
NET ASSETS
Beginning of period 4,332,995,109 3,990,395,095
End of period $ 3,289,740,028 $ 4,332,995,109
</TABLE>
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD ENDED MARCH 31, 1994
7. SIGNIFICANT ACCOUNTING POLICIES.
U.S. Treasury, U.S. Treasury II, U.S. Government, Domestic Money Market and
Money Market Portfolios (the funds) are funds of Fidelity Institutional
Cash Portfolios (the trust) and each fund is authorized to issue an
unlimited number of shares. The trust is registered under the Investment
Company Act of 1940, as amended (the 1940 Act), as an open-end management
investment company organized as a Delaware business trust.
Each fund currently offers two classes of shares, Class A and Class B, each
of which has equal rights as to earnings, assets and voting privileges
except that each class bears different distribution and transfer agent
expenses and certain registration fees. Each class has exclusive voting
rights with respect to its distribution plans. U.S. Treasury Portfolio II
and Money Market Portfolio commenced sale of Class B shares on October 22,
1993 and November 17, 1993, respectively.
The following summarizes the significant accounting policies of the funds:
SECURITY VALUATION. As permitted under Rule 2a-7 of the 1940 Act, and
certain conditions therein, securities are valued initially at cost and
thereafter assume a constant amortization to maturity of any discount or
premium.
INCOME TAXES. As a qualified regulated investment company under Subchapter
M of the Internal Revenue Code, each fund is not subject to income taxes to
the extent that it distributes all of its taxable income for the fiscal
year. The schedules of investments include information regarding income
taxes under the caption "Income Tax Information."
INTEREST INCOME. Interest income, which includes amortization of premium
and accretion of original issue discount, is accrued as earned.
ALLOCATED EARNINGS AND EXPENSES. Investment income, expenses (other than
expenses incurred under each class' Distribution and Service Plans,Transfer
Agent Agreements and certain registration fees) and realized and unrealized
gains or losses on investments are allocated to each class of shares based
upon their relative net assets.
DISTRIBUTIONS TO SHAREHOLDERS. Dividends are declared daily and paid
monthly from net interest income.
Income and capital gain distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles.
CHANGE IN ACCOUNTING FOR DISTRIBUTIONS TO SHAREHOLDERS. Effective April 1,
1993, the funds adopted Statement of Position 93-2: Determination,
Disclosure, and Financial Statement Presentation of Income, Capital Gain,
and Return of Capital Distributions by Investment Companies. As a result,
the funds changed the classification of distributions to shareholders to
better disclose the differences between financial statement amounts and
distributions determined in accordance with income tax regulations.
Accordingly, amounts as of March 31, 1993 have been reclassified as
follows:
INCREASE (DECREASE) INCREASE (DECREASE) (INCREASE) DECREASE
FUND IN PAID IN CAPITAL IN ACCUMULATED NET REALIZED GAIN IN ACCUMULATED NET
REALIZED LOSS
U.S. Treasury $ 7,588 - $ (7,588)
U.S. Treasury II $ 137,025 $ (137,025) -
U.S. Government $ 503,432 $ (503,432) -
Domestic Money Market $ 15,630 - $ (15,630)
Money Market $ 23,666 - $ (23,666)
SECURITY TRANSACTIONS. Security transactions are accounted for as of trade
date. Gains and losses on securities sold are determined on the basis of
identified cost.
8. OPERATING POLICIES.
REPURCHASE AGREEMENTS. The funds, through their custodian, receive delivery
of the underlying securities, whose market value is required to be at least
102% of the resale price at the time of purchase. The funds' investment
adviser, Fidelity Management & Research Company (FMR), is responsible
for determining that the value of these underlying securities remains at
least equal to the resale price.
2. OPERATING POLICIES - CONTINUED
JOINT TRADING ACCOUNT. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the funds, along with other registered
investment companies having management contracts with FMR, may transfer
uninvested cash balances into a joint trading account. These balances are
invested in one or more repurchase agreements that are collateralized by
U.S. Treasury or Federal Agency obligations.
REVERSE REPURCHASE AGREEMENTS. Each fund, other than U.S. Treasury
Portfolio II, is permitted to engage in reverse repurchase agreements for
temporary purposes when it is able to invest the cash so acquired at a rate
higher than the cost related to the agreement. Both the U.S. Treasury and
U.S. Government funds engaged in reverse repurchase agreements during the
period earning net interest income of $105,254 and $195,391, respectively,
which is included in Interest Income on the Statement of Operations.
RESTRICTED SECURITIES. The Domestic Money Market and Money Market funds are
permitted to invest in privately placed restricted securities. These
securities may be resold in transactions exempt from registration or to the
public if the securities are registered. Disposal of these securities may
involve time-consuming negotiations and expense, and prompt sale at an
acceptable price may be difficult. At the end of the period, restricted
securities (excluding 144A issues) amounted to $27,000,000 or 4.1% of net
assets for the Domestic Money Market fund and $207,000,000 or 6.3% of net
assets for the Money Market fund.
9. JOINT TRADING ACCOUNT.
At the end of the period, the U.S. Treasury II fund had 20% or more of its
total investments in repurchase agreements through a joint trading account.
These repurchase agreements were with entities whose creditworthiness has
been reviewed and found satisfactory by FMR. The repurchase agreements were
dated March 31, 1994 and due April 4, 1994. The maturity values of the
joint trading account investments were $831,328,132 at 3.55% and
$381,338,745 at 3.63%. The investments in repurchase agreements through the
joint trading account are summarized as follows:
SUMMARY OF JOINT TRADING ACCOUNT
MAXIMUM
AMOUNT AGGREGATE AGGREGATE AGGREGATE
NO. OF WITH ONE PRINCIPAL MATURITY MARKET COUPON MATURITY
DEALERS DEALER AMOUNT OF AMOUNT OF VALUE OF RATES OF DATES OF
OR BANKS OR BANK AGREEMENTS AGREEMENTS COLLATERAL COLLATERAL COLLATERAL
At 3.55% 11 18.4% $2,169,000,000 $2,169,856,460 $2,508,414,191 0%-13.375%
4/28/94-8/15/21
At 3.63% 6 38.5 520,000,000 520,209,733 530,945,427 0%-13.375%
4/28/94-8/15/21
10. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As each fund's investment adviser, FMR receives a fee that
is computed daily at an annual rate of .20% of the funds' average net
assets.
SUB-ADVISER FEE. As each fund's investment sub-adviser, FMR Texas Inc., a
wholly owned subsidiary of FMR, receives a fee from FMR of 50% of the
management fee payable to FMR. The fees are paid prior to any voluntary
expense reimbursements which may be in effect, and after reducing the fee
for any payments by FMR pursuant to each fund's Distribution and Service
Plan.
DISTRIBUTION AND SERVICE PLAN. Pursuant to the Distribution and Service
Plans of Class B, (the Plan), and in accordance with Rule 12b-1 of the 1940
Act, each Class B fund pays Fidelity Distributors Corporation (FDC), an
affiliate of FMR, a distribution and service fee that is based on an annual
rate of .32% of its average net assets. For the period, Class B of the U.S.
Treasury II and Money Market funds paid FDC $2,065 and $40,685,
respectively, of which $1,433 and $2,583, respectively, was paid to
securities dealers, banks and other financial institutions for selling
shares and providing shareholder support services.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED
TRANSFER AGENT FEE. Fidelity Investments Institutional Operations Company
(FIIOC), an affiliate of FMR, is the funds' transfer, dividend disbursing
and shareholder servicing agent. FIIOC receives fees based on the type,
size, number of accounts and the number of transactions made by
shareholders. FIIOC pays for typesetting, printing and mailing of all
shareholder reports, except proxy statements.
ACCOUNTING FEE. Fidelity Service Co. an affiliate of FMR, maintains the
funds' accounting records. The fee is based on the level of average net
assets for the month plus out-of-pocket expenses.
11. EXPENSE REDUCTIONS.
FMR voluntarily agreed to reimburse the funds' operating expenses
(excluding interest, taxes, brokerage commissions, extraordinary expenses
and 12b-1 fees payable by Class B of each fund's shares) above an annual
rate of .18% of average net assets. For the period, the reimbursement
reduced expenses by $903,610, $2,956,232 and $570, $2,665,587, $638,552
and, $2,437,428 and $7,565 for U.S. Treasury, U.S. Treasury II and U.S.
Treasury II Class B, U.S. Government, Domestic Money Market and, Money
Market and Money Market Class B funds, respectively.
12. SHARE TRANSACTIONS.
Share transactions for both classes of the U.S. Treasury II and Money
Market funds, at net asset value of $1.00 per share, were as follows:
YEARS ENDED MARCH 31,
1994 1993
U.S. TREASURY II CLASS A
Proceeds from sales of shares $ 37,652,306,847 $ 52,467,399,178
Reinvestment of dividends from net interest income 53,681,583
82,378,656
Cost of shares redeemed (38,743,519,132) (52,436,973,582)
Net increase (decrease) in net assets and shares resulting from share
transactions $ (1,037,530,702) $ 112,804,252
U.S. TREASURY II CLASS B *
Proceeds from sales of shares $ 11,853,621 $ -
Reinvestment of dividends from net interest income 14,790 -
Cost of shares redeemed (6,692,877) -
Net increase (decrease) in net assets and shares resulting from share
transactions $ 5,175,534 $ -
(*) Share transactions for U.S. Treasury II Class B are for the period
October 22, 1993 (commencement of sale of shares) to March 31, 1994.
MONEY MARKET CLASS A
Proceeds from sales of shares $ 48,632,985,539 $ 38,749,029,940
Reinvestment of dividends from net interest income 59,354,442
66,490,395
Cost of shares redeemed (49,824,192,759) (38,477,533,862)
Net increase (decrease) in net assets and shares resulting from share
transactions $ (1,131,852,778) $ 337,986,473
MONEY MARKET CLASS B *
Proceeds from sales of shares $ 112,664,085 $ -
Reinvestment of dividends from net interest income 379,584 -
Cost of shares redeemed (23,548,202) -
Net increase (decrease) in net assets and shares resulting from share
transactions $ 89,495,467 $ -
(*) Share transactions for Money Market Class B are for the period November
17, 1993 (commencement of sale of shares) to March 31, 1994.
NEITHER THE TRUST NOR FIDELITY DISTRIBUTORS CORPORATION IS A BANK AND FUND
SHARES ARE NOT BACKED OR GUARANTEED BY
ANY BANK OR INSURED BY THE FDIC.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees and Shareholders of Fidelity Institutional Cash Portfolios:
U.S. Treasury Portfolio, U.S. Treasury Portfolio II, U.S. Government
Portfolio,
Money Market Portfolio and Domestic Money Market Portfolio
In our opinion, the accompanying statements of assets and liabilities,
including the schedules of investments, and the related statements of
operations and of changes in net assets and the per-share data and ratios
(included on pages 4 through 7 of this Prospectus and Statement of
Additional Information) present fairly, in all material respects, the
financial position of Fidelity Institutional Cash Portfolios: U.S. Treasury
Portfolio, U.S. Treasury Portfolio II, U.S. Government Portfolio, Money
Market Portfolio and Domestic Money Market Portfolio at March 31, 1994, and
the results of their operations for the year then ended, the changes in
their net assets for each of the two years then ended, and their per-share
data and ratios for the periods indicated, in conformity with generally
accepted accounting principles. These financial statements and per-share
data and ratios (hereafter referred to as "financial statements") are the
responsibility of the Trust's management; our responsibility is to express
an opinion on these financial statements based on our audits. We conducted
our audits in accordance with generally accepted auditing standards, which
require that we plan and perform the audits to obtain reasonable assurance
about whether the financial statements are free of material misstatement.
An audit includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management,
and evaluating the overall financial statement presentation. We believe
that our audits, which included confirmation of securities owned at March
31, 1994 by correspondence with the custodian and brokers, provide a
reasonable basis for the opinion expressed above.
PRICE WATERHOUSE
Dallas, Texas
May 13, 1994
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