<PAGE>
PHOTO OF
COLONIAL OBJECTS
August 1995
Dear Shareholder:
The U.S. Government Money Fund's 14-year lifetime has spanned a wide variety of
economic and interest rate cycles, and through each one, your Fund has achieved
the goals it originally set out to accomplish -- providing shareholders with
relative safety, liquidity and current income.
The current economic situation, heavily influenced by the Federal
Reserve Board's actions over the past year, has enabled money market funds,
including U.S. Government Money Fund, to provide greater rewards for
shareholders. Reversing course after nearly a five-year decline in interest
rates, the Federal Reserve Board ("the Fed"), our nation's central bank, boosted
short-term interest rates sharply during 1994 and into 1995 in an effort to
control the growth of the economy and keep the pace of inflation in check. At
the start of 1994, the influential Federal Funds rate, the interest rate banks
use to make short-term loans to each other, was 3.00%. By February 1995, the
Federal Funds rate was 6.00%, and even after the July 6, 1995, cut in the
federal funds rate, the first move of easing in nearly three years, the rate
stood at 5.75% -- still nearly double what it was just a little over a year ago.
We are pleased with the effects of the market climate, interest rates
and the recent economic environment on U.S. Government Money Fund's level of
income during the first half of our 1995 fiscal year, ended June 30. The table
below shows the effect on your Fund's seven-day annualized yields over the past
two years, given the change in short-term interest rates during this period.
- -------------------------------------------------------------------------------
SEVEN-DAY ANNUALIZED YIELD
June 30, December 30, June 30, December 31, June 30,
1993 1993 1994 1994 1995
2.17% 1.82% 2.77% 4.36% 4.48%
- -------------------------------------------------------------------------------
No matter what the future interest rate environment holds in store, U.S.
Government Money Fund will aim to maintain the highest quality holdings to
achieve its objective of maximum current income while preserving principal and
maintaining liquidity, through a diversified portfolio with full-service
management by a professional investment staff.
Please keep in mind that money market funds like U.S. Government Money
Fund are not designed for long-term growth. However, Delaware Group does offer a
complete family of funds. Together, you and your financial adviser can determine
which best fit your investment goals.
Once again, thank you for choosing Delaware Group to invest your money.
We appreciate the opportunity to help you meet your short-term investing needs
through U.S. Government Money Fund, and we look forward to serving your other
investment needs throughout 1995 and in the years to come.
Sincerely,
/s/ Wayne A. Stork /s/ Brian F. Wruble
- ------------------------------- --------------------------------------
Wayne A. Stork Brian F. Wruble
Chairman, Board of Directors President and Chief Executive Officer
Delaware Group Delaware Group
U.S. Government Money Fund U.S. Government Money Fund
*The SEC-required average annual rates of return for the 10-, five- and one year
periods ended June 30, 1995, for U.S. Government Money Fund Class A are +5.20%,
+3.85% and +4.14%, respectively, and the returns for the Consultant Class are
+5.14%, +3.85% and +4.14%, respectively. These returns reflect the reinvestment
of all distributions. Money market funds strive to maintain a stable share value
of $1; however, there is no guarantee that this goal will be met. Shares of
money market funds are not insured or guaranteed by the U.S. Government. Yields
fluctuate with market conditions.
1
<PAGE>
Financial Statements
DELAWARE GROUP LIMITED-TERM GOVERNMENT FUNDS, INC.
- U.S. GOVERNMENT MONEY SERIES*
STATEMENT OF NET ASSETS
June 30, 1995
(Unaudited)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
<S> <C> <C>
FEDERAL AGENCY DISCOUNT NOTES - 54.05%
Federal Home Loan Bank 5.36% 12/11/95........................................ $ 550,000 $ 536,652
Federal Home Loan Bank 5.90% 10/10/95........................................ 330,000 324,538
Federal Home Loan Mortgage Corporation 5.87% 7/20/95......................... 500,000 498,451
Federal Home Loan Mortgage Corporation 5.88% 8/28/95......................... 655,000 648,879
Federal Home Loan Mortgage Corporation 5.97% 10/4/95......................... 500,000 492,123
Federal National Mortgage Association 5.56% 12/6/95.......................... 500,000 487,799
Federal National Mortgage Association 5.58% 11/20/95......................... 300,000 293,397
Federal National Mortgage Association 5.62% 12/22/95......................... 300,000 291,851
Federal National Mortgage Association 5.75% 10/6/95.......................... 500,000 492,253
Federal National Mortgage Association 5.79% 9/8/95........................... 405,000 400,506
Federal National Mortgage Association 5.83% 7/27/95.......................... 500,000 497,895
Federal National Mortgage Association 5.84% 10/18/95......................... 335,000 329,076
Federal National Mortgage Association 5.85% 9/21/95.......................... 315,000 310,803
Federal National Mortgage Association 5.88% 7/6/95........................... 850,000 849,306
Federal National Mortgage Association 5.98% 8/14/95.......................... 500,000 496,346
Federal National Mortgage Association 6.04% 8/28/95.......................... 500,000 495,134
Federal National Mortgage Association 6.08% 7/5/95........................... 750,000 749,493
-----------
TOTAL FEDERAL AGENCY DISCOUNT NOTES.......................................... 8,194,502
-----------
FEDERAL AGENCY NOTES - 6.59%
Federal National Mortgage Association 5.50% 6/12/96.......................... 500,000 498,094
Federal National Mortgage Association 6.57% 4/24/96.......................... 500,000 500,000
-----------
TOTAL FEDERAL AGENCY NOTES................................................... 998,094
-----------
FLOATING RATE NOTES - 29.68%+
Federal Farm Credit Bank 6.20% 7/7/95........................................ 500,000 499,853
Federal Home Loan Bank 6.00% 7/3/95.......................................... 1,000,000 999,897
Student Loan Marketing Association 5.56% 7/4/95.............................. 500,000 500,000
Student Loan Marketing Association 5.59% 7/4/95.............................. 500,000 500,000
Student Loan Marketing Association 5.66% 7/4/95.............................. 2,000,000 2,000,000
-----------
TOTAL FLOATING RATES NOTES................................................... 4,499,750
-----------
REPURCHASE AGREEMENT - 9.40%
With Chase Manhattan Bank 6.125% 7/3/95 (dated 6/30/95, collateralized by
$1,410,000 U.S. Treasury Notes 6.875% due 2/28/97,
market value $1,463,728)..................................................... 1,425,000 1,425,000
-----------
TOTAL REPURCHASE AGREEMENT................................................... 1,425,000
-----------
TOTAL MARKET VALUE OF SECURITIES OWNED - 99.72%
(WHICH APPROXIMATES COST FOR FINANCIAL REPORTING AND INCOME TAX PURPOSES)... 15,117,346
RECEIVABLES AND OTHER ASSETS NET OF LIABILITIES - 0.28%...................... 43,008
-----------
NET ASSETS APPLICABLE TO 14,340,824 U.S. GOVERNMENT MONEY FUND A CLASS SHARES
AND 819,530 U.S. GOVERNMENT MONEY FUND CONSULTANT CLASS SHARES OUTSTANDING;
EQUIVALENT TO $1.00 PER SHARE - 100.00%..................................... $15,160,354
===========
</TABLE>
See accompanying notes
- ------
* Formerly known as Delaware Group Treasury Reserves, Inc. - U.S. Government
Money Series.
+ For Floating Rate Notes, the maturity date shown is the next interest reset
date.
2
<PAGE>
DELAWARE GROUP LIMITED-TERM GOVERNMENT
FUNDS, INC. - U.S. GOVERNMENT MONEY SERIES
STATEMENT OF OPERATIONS
Six Months Ended June 30, 1995
(Unaudited)
INVESTMENT INCOME:
Interest ......................................... $478,855
EXPENSES:
Management fees ($35,880) and
directors' fees ($4,471) ....................... $ 40,351
Dividend disbursing and transfer
agent fees and expenses ......................... 26,932
Federal and state registration fees .............. 15,672
Reports and statements to shareholders ........... 7,940
Professional fees ................................ 7,482
Taxes (other than income) ........................ 3,279
Salaries ......................................... 2,266
Custodian fees ................................... 2,075
Other ............................................ 3,691 109,688
-------- --------
NET INVESTMENT INCOME ............................ $369,167
========
See accompanying notes
<PAGE>
DELAWARE GROUP LIMITED-TERM GOVERNMENT
FUNDS, INC. - U.S. GOVERNMENT MONEY SERIES
STATEMENT OF CHANGES IN NET ASSETS
Six Months
Ended Year
6/30/95 Ended
(Unaudited) 12/31/94
OPERATIONS:
Net investment income .................... $ 369,167 $ 594,338
------------- -------------
DISTRIBUTIONS TO SHAREHOLDERS
FROM NET INVESTMENT INCOME:
U.S. Government Money Fund A Class ....... (349,028) (571,649)
U.S. Government Money Fund
Consultant Class ........................ (20,139) (22,689)
------------- -------------
(369,167) (594,338)
------------- -------------
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold:
U.S. Government Money Fund A Class ...... 6,018,940 16,559,404
U.S. Government Money Fund
Consultant Class ....................... 115,973 942,446
Net asset value of shares issued upon
reinvestment of dividends from net
investment income:
U.S. Government Money Fund A Class ...... 335,305 537,560
U.S. Government Money Fund
Consultant Class ....................... 19,185 19,884
------------- -------------
6,489,403 18,059,294
Cost of shares repurchased:
U.S. Government Money Fund A Class ...... (9,132,900) (20,896,267)
U.S. Government Money Fund
Consultant Class ....................... (392,241) (440,741)
------------- -------------
(9,525,141) (21,337,008)
------------- -------------
Decrease in net assets derived from
capital share transactions .............. (3,035,738) (3,277,714)
------------- -------------
NET DECREASE IN NET ASSETS ............... (3,035,738) (3,277,714)
NET ASSETS:
Beginning of period ...................... 18,196,092 21,473,806
------------- -------------
End of period ............................ $ 15,160,354 $ 18,196,092
============= =============
See accompanying notes
3
<PAGE>
DELAWARE GROUP LIMITED-TERM GOVERNMENT FUNDS, INC.
- U.S. GOVERNMENT MONEY SERIES
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1995
(Unaudited)
Delaware Group Limited-Term Government Funds, Inc. - U.S. Government Money
Series (formerly known as Delaware Group Treasury Reserves, Inc. - U.S.
Government Money Series) (the "Fund"), is a series of Delaware Group
Limited-Term Government Funds, Inc., (the "Company"), a diversified open-end
investment company registered under the Investment Company Act of 1940. The
Company is organized as a Maryland corporation. The Fund offers two classes of
shares.
1. SIGNIFICANT ACCOUNTING POLICIES
The accounting policies are in accordance with generally accepted accounting
principles and are consistently followed by the Fund for financial statement
preparation:
SECURITY VALUATION - Securities are valued at amortized cost which approximates
market value.
FEDERAL INCOME TAXES - The Fund intends to continue to qualify as a regulated
investment company and make the requisite distributions to shareholders.
Accordingly, no provision for federal income taxes is required in the financial
statements.
CLASS ACCOUNTING - Investment income and common expenses are allocated to the
various classes of the Fund on the basis of daily net assets of each class.
OTHER - Expenses common to all funds within the Delaware Group Family of Funds
are allocated amongst the funds on the basis of average net assets. Security
transactions are recorded on the date the securities are purchased or sold
(trade date). Premiums and discounts are amortized on a pro-rata basis and
included in interest income. The Fund declares dividends daily from net
investment income and pays such dividends monthly.
<PAGE>
2. INVESTMENT MANAGEMENT FEE AND DISTRIBUTION AGREEMENTS
In accordance with the terms of the Investment Management Agreement, the Fund
pays Delaware Management Company, Inc. (DMC), the investment manager of the
Fund, an annual fee which is calculated daily at 0.50% of the average daily net
assets of the Fund, less fees paid to the independent directors. At June 30,
1995, the Fund had a liability for Investment Management fees and other expenses
payable to DMC for $6,203.
Pursuant to the Distribution Agreement, the Fund may pay Delaware Distributors,
L.P. (DDLP), the Distributor and an affiliate of DMC, an annual 12b-1 fee not to
exceed 0.25% of the average daily net assets of the Consultant Class. Effective
June 1, 1990, 12b-1 Plan payments from the Consultant Class to DDLP were
suspended but may be reinstated in the future.
The Fund has engaged Delaware Service Company, Inc. (DSC), an affiliate of DMC,
to serve as dividend disbursing and transfer agent for the Fund. For the six
months ended June 30, 1995, the Fund expensed $21,836 for these services. At
June 30, 1995, the Fund had a liability for such fees and other expenses payable
to DSC for $1,520.
Certain officers of the Investment Manager are officers, directors, and/or
employees of the Fund. These officers, directors, and employees are paid no
compensation by the Fund.
On April 3, 1995, Delaware Management Holdings, Inc., the indirect parent of
DMC, DDLP and DSC, through a merger transaction (the "Merger") became a
wholly-owned subsidiary of Lincoln National Corporation. Other than the
resulting change in ownership, the Merger will not materially change the manner
in which DMC, DDLP and DSC have heretofore conducted their respective
relationships with the Fund.
An annual meeting of shareholders was held on March 29, 1995. The matters
submitted to a vote of shareholders were the election of directors, the approval
of a new investment management agreement and the ratification of the selection
of Ernst & Young LLP as independent auditors of the Fund. The new investment
management agreement was submitted for shareholder approval in connection with
the Merger because the Investment Company of 1940 requires shareholders to vote
on a new investment management agreement whenever there is a change in control
of an investment manager.
The names of each director elected at the meeting along with the final vote
tabulation with respect to each nominee and each matter were as follows:
Number of Votes
------------------------------------------------
For Against/withheld Abstentions
------------------------------------------------
Election of Directors*:
Wayne A. Stork 63,772,321 1,734,614 -
Walter P. Babich 63,791,470 1,715,464 -
Anthony D. Knerr 63,791,558 1,717,376 -
Ann R. Leven 63,789,806 1,717,128 -
W. Thacher Longstreth 63,782,327 1,724,607 -
Charles E. Peck 63,791,470 1,715,464 -
Approval of the New Investment
Management Agreement 10,549,246 140,512 567,806
Selection of Ernst & Young LLP
as Independent Auditors* 60,561,793 605,865 4,339,275
* Voted upon by all shareholders of the Company
4
<PAGE>
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
3. FUND SHARES
Transactions in capital stock shares of the Fund were as follows:
<TABLE>
<CAPTION>
SIX MONTHS YEAR
ENDED ENDED
6/30/95 12/31/94
<S> <C> <C>
Shares sold:
U.S. Government Money Fund A Class ..................................... 6,018,940 16,559,404
U.S. Government Money Fund Consultant Class ............................ 115,973 942,446
Shares issued upon reinvestment of dividends from net investment income:
U.S. Government Money Fund A Class ..................................... 335,305 537,560
U.S. Government Money Fund Consultant Class ............................ 19,185 19,884
----------- -----------
6,489,403 18,059,294
----------- -----------
Shares repurchased:
U.S. Government Money Fund A Class ..................................... (9,132,900) (20,896,267)
U.S. Government Money Fund Consultant Class ............................ (392,241) (440,741)
----------- -----------
(9,525,141) (21,337,008)
----------- -----------
Net decrease ............................................................ (3,035,738) (3,277,714)
=========== ===========
</TABLE>
5
<PAGE>
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
4. FINANCIAL HIGHLIGHTS
Selected data for each share of the Fund outstanding throughout each period were
as follows:
<TABLE>
<CAPTION>
U.S.GOVERNMENT MONEY FUND A CLASS
--------------------------------------------------------------
SIX MONTHS
ENDED YEAR ENDED DECEMBER 31,
6/30/95* 1994 1993 1992 1991 1990
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period................... $1.0000 $1.0000 $1.0000 $1.0000 $1.0000 $1.0000
Income from investment operations:
Net investment income ................................ 0.0228 0.0289 0.0200 0.0308 0.0519 0.0711
Net realized gain from security transactions.......... none none none none none none
-------- ------- ------- ------- ------- -------
Total from investment operations...................... 0.0228 0.0289 0.0200 0.0308 0.0519 0.0711
-------- ------- ------- ------- ------- -------
Less distributions:
Dividends from net investment income.................. (0.0228) (0.0289) (0.0200) (0.0308) (0.0519) (0.0711)
-------- ------- ------- ------- ------- -------
Total distributions................................... (0.0228) (0.0289) (0.0200) (0.0308) (0.0519) (0.0711)
-------- ------- ------- ------- ------- -------
Net asset value, end of period......................... $1.0000 $1.0000 $1.0000 $1.0000 $1.0000 $1.0000
======= ======= ======= ======= ======= =======
Total return........................................... 2.31% 2.93% 2.01% 3.13% 5.32% 7.35%
Ratios/supplemental data:
Net assets, end of period (000 omitted)............... $14,341 $17,119 $20,919 $41,049 $45,933 $49,907
Ratio of expenses to average net assets............... 1.36% 1.26% 1.04% 0.91% 0.85% 0.82%
Ratio of net investment income to average net assets.. 4.57% 2.91% 2.06% 3.11% 5.23% 7.11%
</TABLE>
- -------------
*Ratios have been annualized and total return has not been annualized.
6
<PAGE>
4. FINANCIAL HIGHLIGHTS
Selected data for each share of the Fund outstanding throughout each period were
as follows:
<TABLE>
<CAPTION>
U.S.GOVERNMENT MONEY FUND CONSULTANT CLASS
--------------------------------------------------------------
SIX MONTHS
ENDED YEAR ENDED DECEMBER 31,
6/30/95* 1994 1993 1992 1991 1990
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period................... $1.0000 $1.0000 $1.0000 $1.0000 $1.0000 $1.0000
Income from investment operations:
Net investment income ................................ 0.0228 0.0289 0.0200 0.0308 0.0519 0.0700
Net realized gain from security transactions.......... none none none none none none
-------- ------- ------- ------- ------- -------
Total from investment operations...................... 0.0228 0.0289 0.0200 0.0308 0.0519 0.0700
-------- ------- ------- ------- ------- -------
Less distributions:
Dividends from net investment income.................. (0.0228) (0.0289) (0.0200) (0.0308) (0.0519) (0.0700)
-------- ------- ------- ------- ------- -------
Total distributions................................... (0.0228) (0.0289) (0.0200) (0.0308) (0.0519) (0.0700)
-------- ------- ------- ------- ------- -------
Net asset value, end of period......................... $1.0000 $1.0000 $1.0000 $1.0000 $1.0000 $1.0000
======== ======= ======= ======= ======= =======
Total return........................................... 2.31% 2.93% 2.01% 3.13% 5.32% 7.23%
Ratios/supplemental data:
Net assets, end of period (000 omitted)............... $819 $1,077 $555 $747 $1,399 $1,604
Ratio of expenses to average net assets............... 1.36% 1.26% 1.04% 0.91% 0.85% 0.94%
Ratio of net investment income to average net assets.. 4.57% 2.91% 2.06% 3.11% 5.23% 6.99%
</TABLE>
- -------------
*Ratios have been annualized and total return has not been annualized.
7
<PAGE>
- -----------------------------------------------------------------------------
| Delaware Group includes funds wth a wide range of investment |
| objectives. Stock funds, income funds, tax-free funds, money market |
| funds, closed-end equity/income funds and global funds give investors |
| the ability to create a portfolio that fits their personal financial |
| goals. For more information, including a prospectus of any Delaware |
| Group fund, contact your financial adviser or call Delaware Group at |
| 800-523-4640 or 215-988-1333 in Philadelphia. Read the prospectus |
| carefully before investing. |
| Mutual funds are not obligations of or guaranteed by any bank |
| and are not FDIC insured. In addition, they involve risk, including |
| possible loss of principal. |
| |
| INVESTMENT MANAGER SHAREHOLDER SERVICING, |
| Delaware Management Company, Inc. DIVIDEND DISBURSING |
| INTERNATIONAL AFFILIATE AND TRANSFER AGENT |
| Delaware International Advisers Ltd. Delaware Service Company, Inc.|
| NATIONAL DISTRIBUTOR |
| Delaware Distributors, L.P. |
- -----------------------------------------------------------------------------
SA - 005 [6/95] PP895 Printed in the U.S.A.
__________________
| |
| BULK RATE |
| U.S. POSTAGE |
| PAID |
| Permit No.145 |
| Conshohocken, PA |
|__________________|
DELAWARE GROUP
A TRADITION OF SOUND INVESTING SINCE 1929
PHOTO OF VARIOUS
COLONIAL OBJECTS
|
|
1995 |
|
SEMI- |
|
ANNUAL |
| DELAWARE
REPORT | GROUP
| -----------
| U.S. GOVERNMENT
| MONEY FUND
|
