<PAGE> 1
[ZURICH LOGO]
Zurich Money Funds
'99
Annual Report to Shareholders for the Year Ended July 31, 1999
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
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SUBJECT PAGE
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<S> <C>
FUND OBJECTIVES 1
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PERFORMANCE SUMMARY 2
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VARIABLES AFFECTING PERFORMANCE 5
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PERFORMANCE UPDATE 6
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TERMS TO KNOW 10
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PORTFOLIO COMPOSITION 12
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PORTFOLIO OF INVESTMENTS 13
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FINANCIAL STATEMENTS 32
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FINANCIAL HIGHLIGHTS 38
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</TABLE>
<PAGE> 3
1
FUND OBJECTIVES
Zurich Money Funds (the "Trust") is an open-end, diversified, management
investment company offering a choice of three investment funds. Each fund
invests in high quality short-term money market instruments consistent with its
specific objective as outlined below.
Like all money market funds, an investment in these funds is not insured or
guaranteed by the FDIC or any other government agency. Although money funds seek
to preserve your investment at $1.00 per share, it is possible to lose money.
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ZURICH MONEY MARKET FUND
- --------------------------------------------------------------------------------
This fund seeks maximum current income to the extent consistent with stability
of principal by investing primarily in commercial paper, securities of the U.S.
Government, its agencies, and bank certificates of deposit.
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ZURICH GOVERNMENT MONEY FUND
- --------------------------------------------------------------------------------
This fund seeks maximum current income to the extent consistent with stability
of principal by investing exclusively in obligations issued or guaranteed by the
U.S. Government, its agencies or instrumentalities.
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ZURICH TAX-FREE MONEY FUND
- --------------------------------------------------------------------------------
This fund seeks maximum current income that is exempt from federal income taxes
to the extent consistent with stability of principal from a portfolio of
short-term, high quality tax-exempt municipal securities.
<PAGE> 4
PERFORMANCE SUMMARY
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ZURICH MONEY MARKET FUND
- --------------------------------------------------------------------------------
YIELD COMPARISON
Zurich Money Market Fund is compared to the First Tier Money Fund Average which
consists of all non-institutional taxable money market funds investing in only
first tier (highest rating) securities tracked by IBC Financial Data. Returns
are historical and do not guarantee future results. Fund yields fluctuate.
7-day average yield is the annualized net investment income per share for the
period shown. Gains or losses are not included.
[PERFORMANCE GRAPHS]
<TABLE>
<CAPTION>
ZURICH MONEY MARKET FUND IBC'S FIRST TIER RETAIL AVG/TOTAL
------------------------ ---------------------------------
<S> <C> <C>
8/4/98 5.18 4.92
5.19 4.91
5.19 4.92
5.19 4.81
5.17 4.82
5.16 4.80
5.18 4.82
5.17 4.89
5.13 4.87
5.09 4.83
5.07 4.76
4.98 4.71
4.99 4.64
4.94 4.67
4.94 4.62
4.94 4.63
4.92 4.54
4.86 4.56
4.87 4.53
4.87 4.55
4.86 4.54
4.88 4.52
4.90 4.56
4.84 4.47
4.77 4.44
4.75 4.37
4.71 4.34
4.63 4.31
4.58 4.28
4.55 4.28
4.55 4.27
4.56 4.25
4.54 4.24
4.52 4.22
4.50 4.22
4.51 4.25
4.53 4.21
4.52 4.20
4.53 4.18
4.50 4.21
4.50 4.19
4.54 4.18
4.51 4.18
4.52 4.22
4.53 4.21
4.54 4.22
4.58 4.22
4.70 4.26
4.65 4.31
4.69 4.33
4.71 4.36
7/27/99 4.70 4.38
</TABLE>
LIPPER RANKING
Lipper, Inc. rankings are based upon changes in net asset value with all
dividends reinvested for the periods indicated as of 7/31/99. Rankings are
historical and do not guarantee future performance. The fund is compared to the
Lipper Money Market Instrument Fund category.
[PERFORMANCE GRAPHS]
<TABLE>
<S> <C> <C>
Top Fund #1 of 39 funds 20 years
Top 10% #13 of 131 funds 10 years
Top 11% #24 of 217 funds 5 years
Top 12% #37 of 320 funds 1 year
</TABLE>
10-YEAR PERFORMANCE
This chart shows the value of a hypothetical $10,000 investment in Zurich Money
Market Fund over the past 10 fiscal years with all dividends reinvested. The
returns shown are historical and do not guarantee future performance.
[PERFORMANCE GRAPHS]
<TABLE>
<CAPTION>
10-YEAR PERFORMANCE
-------------------
<S> <C>
7/31/89 10000.00
10853.00
11633.00
12149.00
12508.00
12907.00
13596.00
14325.00
15079.00
15887.00
7/31/99 16660.00
</TABLE>
2
<PAGE> 5
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ZURICH GOVERNMENT MONEY FUND
- --------------------------------------------------------------------------------
YIELD COMPARISON
Zurich Government Money Fund is compared to the Government Money Fund Average
which consists of all non-institutional government money market funds tracked by
IBC Financial Data. Returns are historical and do not guarantee future results.
Fund yields fluctuate.
7-day average yield is the annualized net investment income per share for the
period shown. Gains or losses are not included.
[PERFORMANCE GRAPHS]
<TABLE>
<CAPTION>
ZURICH GOVERNMENT MONEY FUND IBC'S GOVERNMENT RETAIL AVG/TOTAL
---------------------------- ---------------------------------
<S> <C> <C>
8/4/98 5.18 4.87
5.14 4.82
5.16 4.84
5.16 4.81
5.15 4.86
5.11 4.82
5.13 4.86
5.10 4.78
5.06 4.73
4.91 4.64
4.81 4.53
4.70 4.49
4.63 4.31
4.66 4.49
4.74 4.37
4.66 4.42
4.67 4.22
4.69 4.33
4.67 4.24
4.85 4.32
4.67 4.28
4.71 4.27
4.67 4.29
4.62 4.20
4.59 4.24
4.54 4.16
4.60 4.20
4.63 4.16
4.63 4.16
4.55 4.15
4.60 4.19
4.54 4.17
4.51 4.18
4.54 4.15
4.59 4.18
4.51 4.23
4.44 4.13
4.45 4.12
4.46 4.09
4.52 4.16
4.51 4.09
4.51 4.13
4.50 4.09
4.46 4.15
4.38 4.11
4.46 4.13
4.54 4.08
4.58 4.16
4.49 4.22
4.53 4.22
4.68 4.26
7/27/99 4.58 4.28
</TABLE>
LIPPER RANKING
Lipper, Inc. rankings are based upon changes in net asset value with all
dividends reinvested for the periods indicated as of 7/31/99. Rankings are
historical and do not guarantee future performance. The fund is compared to the
Lipper Government Money Market Fund category.
[PERFORMANCE GRAPHS]
<TABLE>
<S> <C> <C>
Top 6% #3 of 50 funds 10 years
Top 8% #7 of 88 funds 5 years
Top 12% #14 of 120 funds 1 year
</TABLE>
10-YEAR PERFORMANCE
This chart shows the value of a hypothetical $10,000 investment in Zurich
Government Money Fund over the past 10 fiscal years, with all dividends
reinvested. The returns shown are historical and do not represent future
performance.
[PERFORMANCE GRAPHS]
<TABLE>
<CAPTION>
10-YEAR PERFORMANCE
-------------------
<S> <C>
7/31/89 10000.00
10844.00
11596.00
12118.00
12478.00
12877.00
13567.00
14294.00
15045.00
15845.00
7/31/99 16600.00
</TABLE>
3
<PAGE> 6
4
ZURICH MONEY FUNDS PERFORMANCE SUMMARY, CONTINUED
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ZURICH TAX-FREE MONEY FUND
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YIELD COMPARISON
Zurich Tax-Free Money Fund is compared to the Tax-Free Money Fund Average which
consists of all non-institutional tax-free money market funds tracked by IBC
Financial Data. Returns are historical and do not guarantee future results. Fund
yields fluctuate. Income from Zurich Tax-Free Money Fund may be subject to state
and local taxes and the alternative minimum tax.
7-day average yield is the annualized net investment income per share for the
period shown. Gains or losses are not included.
[PERFORMANCE GRAPHS]
<TABLE>
<CAPTION>
ZURICH TAX-FREE MONEY FUND IBC'S TAX-FREE NATIONAL AVG/TOTAL
-------------------------- ---------------------------------
<S> <C> <C>
8/4/98 3.36 3.07
3.21 2.79
3.24 2.82
3.23 2.91
3.24 2.92
3.13 2.73
3.18 2.87
3.45 3.16
3.61 3.31
3.40 3.10
3.20 2.89
3.17 2.87
3.01 2.78
3.04 2.78
2.89 2.68
2.95 2.78
3.01 2.85
2.92 2.78
2.63 2.50
2.85 2.68
3.02 2.85
3.22 3.06
3.41 3.25
2.76 2.64
2.72 2.58
2.88 2.50
2.60 2.43
2.24 2.06
2.23 2.08
2.48 2.35
2.65 2.51
2.54 2.38
2.74 2.54
2.75 2.57
2.74 2.55
2.72 2.52
2.56 2.35
2.80 2.60
3.05 2.84
3.28 3.10
3.30 3.00
3.01 2.91
3.05 2.81
2.93 2.76
2.74 2.58
2.79 2.65
2.91 2.77
3.06 3.01
2.96 2.86
2.75 2.42
2.70 2.53
7/27/99 2.83 2.64
</TABLE>
LIPPER RANKING
Lipper, Inc. rankings are based upon changes in net asset value with all
dividends reinvested for the periods indicated as of 7/31/99. Rankings are
historical and do not guarantee future performance. The Lipper category used for
comparison is the Lipper Tax-Exempt Money Market Fund category.
[PERFORMANCE GRAPHS]
<TABLE>
<S> <C> <C>
Top 10% #7 of 71 funds As of 10 years
Top 7% #8 of 108 funds As of 5 years
Top 9% #12 of 130 funds As of 1 year
</TABLE>
10-YEAR PERFORMANCE
This chart shows the value of a hypothetical $10,000 investment in Zurich
Tax-Free Money Fund over the past 10 fiscal years, with all dividends
reinvested. The returns shown are historical and do not guarantee future
performance.
[PERFORMANCE GRAPHS]
<TABLE>
<CAPTION>
10-YEAR PERFORMANCE
-------------------
<S> <C>
7/31/89 10000.00
10580.00
11116.00
11513.00
11787.00
12061.00
12486.00
12919.00
13356.00
13815.00
7/31/99 14221.00
</TABLE>
<PAGE> 7
5
VARIABLES AFFECTING PERFORMANCE
The investment manager invests in high-quality, short-term securities that are
consistent with each fund's specific objectives.
Our primary goal is to provide competitive yields while maintaining preservation
of principal and a high degree of liquidity. The specific securities selected by
our portfolio managers have a major impact on reaching this goal. Additionally,
our portfolio managers must continuously analyze other variables which affect
share price stability and fund performance. Three of the most important
variables factored into the decision-making process are:
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MONETARY POLICY
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Monetary Policy is managed by the Federal Reserve Board (the "Fed") and has a
direct impact on short-term interest rates. If the Fed determines that inflation
is climbing, it will enact a policy to decrease or "tighten" the money supply.
With less money available, money lenders can command higher interest rates on
the money market securities they buy. On the other hand, if the Fed determines
the economy is heading toward a recession, it will increase or "ease" the money
supply. With more money for borrowers to access, the interest rates for money
market securities decline.
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INTEREST RATES
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Interest Rates will affect money fund yields because as investments mature, the
cash received will be reinvested at current money market rates which could be
either higher or lower. Reinvesting at higher interest rates generally means
higher yields for money funds and reinvesting at lower rates generally means
lower yields.
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AVERAGE LENGTH OF MATURITY
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Average Length of Maturity affects the timing of reinvesting cash from maturing
investments. If interest rates are expected to rise, decreasing the portfolio's
average length of maturity would enable the Fund to purchase higher-yielding
money market securities sooner. Conversely, if rates were expected to decrease,
the Fund would invest in money market securities with a longer length of
maturity in order to maintain higher yields longer.
(ALSO SEE "TERMS TO KNOW" SECTION)
<PAGE> 8
6
PERFORMANCE UPDATE
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AN INTERVIEW WITH PORTFOLIO MANAGER FRANK RACHWALSKI
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[RACHWALSKI PHOTO]
As the fiscal year began, the Federal Reserve Board ("The Fed") took charge of
the financial markets with 0.25% cuts in the federal funds rate on September 29,
October 15 and November 17. These moves were intended to stimulate and stabilize
global economies. Below, lead portfolio manager Frank Rachwalski discusses the
effect of the Fed's actions on the financial markets and the funds.
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FRANK RACHWALSKI IS A MANAGING DIRECTOR OF SCUDDER KEMPER INVESTMENTS, INC. AND
LEAD PORTFOLIO MANAGER OF ZURICH MONEY FUNDS. HE JOINED THE ORGANIZATION IN
1973.
Q FRANK, COULD YOU PROVIDE A BROAD OVERVIEW OF THE MONEY MARKETS FOR THE
LAST YEAR AND THE FORCES THAT SHAPED THEM?
- --------------------------------------------------------------------------------
A Certainly. We saw a little bit of everything from the markets in the
12-month period ended July 31, 1999. In the fourth quarter last year,
economic growth in the U.S. was increasing at a moderately strong pace.
However, economic problems in Russia and Latin America emerged, following on the
heels of similar distress in Asian countries. Eventually, the financial turmoil
overseas prompted investors to pour money into U.S. Treasury securities. In
fact, 30-year Treasury bonds were trading below the fed funds rate for the first
time since 1989. The Fed needed to take action to both stabilize financial
markets and provide some protection from slower economic growth. They responded
with the three rate cuts.
- --------------------------------------------------------------------------------
The views expressed in this report reflect those of the portfolio manager only
through the end of the period of the report, as stated
on the cover. The manager's views are subject to change at any time, based on
market and other conditions.
<PAGE> 9
7
Q DID THIS MOVE WORK?
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A Yes, it did. In fact, it may have worked TOO well. Stock markets here
and abroad bounced back, but long-bond yields rose as investors exited
these securities in favor of higher potential returns elsewhere. This
created a tough environment for bond investors as yields rose and prices fell on
most types of fixed-income securities. Adding to the difficulty was a slight
uptick in inflation measures. This, coupled with tight labor markets, prompted
the Federal Reserve to raise the Federal Funds rate by 0.25% in late June,
partially rescinding the cuts they made earlier.
Q HOW DID THESE EVENTS AFFECT SHORT-MATURITY INVESTMENTS SUCH AS MONEY
MARKET FUNDS AND T-BILLS?
- -------------------------------------------------------------------------------
A Short-term investments reflected these developments as yields increased
toward the end of the 12-month period. More aggressive money market funds
with long maturities did well in the fourth quarter of 1998, but lagged
as the market started reflecting upward rate pressures in 1999.
It's been a difficult year for most areas of the fixed income market. However,
our money market investments did what they are supposed to do: they provided
stability and liquidity.
Q HOW WERE THE ZURICH MONEY FUNDS POSITIONED?
- --------------------------------------------------------------------------------
A We remained defensive through most of the year, so we kept the average
maturity of the funds relatively short (see page 12 for details). In our
experience, you don't want to be aggressive when conditions
Continued
<PAGE> 10
8
are unpredictable, like the last 12 months have been. This conservative
positioning caused us to underperform some peers slightly in the last quarter of
1998. But for most of the past year period, the yield curve on tax-free
securities was inverted, so the better return on shorter-maturity paper fit our
strategy and helped us outperform many other funds. Ultimately, shareholders
should be pleased because the funds continue to perform well versus our peers as
measured by Lipper, Inc. and IBC Financial Data (see pages 2-4 for details).
Q WHAT'S YOUR OUTLOOK FOR THE NEXT FEW MONTHS?
------------------------------------------------------------------------
A We think the Fed will raise rates but it will be "one and done" with no
additional increases. The Fed needs to maintain orderly financial
markets in the face of any potential irrational behavior sparked by Y2K
fears. In fact, Y2K behavior should make the last quarter of the year quite
interesting. As the end of the year draws close, we could see more people
transfer assets to money market funds for safety and liquidity reasons. That
could prompt T-bill prices to increase and yields to fall. Or we could see a
number of investors transfer out of investments altogether, and the resulting
lack of demand could spark a rise in yields and price decline.
Into next year, however, with Y2K concerns out of the way, we could see a
resurgence in inflation as spending picks up and assets are redistributed. The
Fed might then again be forced to boost the Fed Funds rate. Regardless, we'll
likely remain in our slightly defensive positioning, with shorter-than-typical
maturities to guard against an uptick in rates, and greater-than-normal cash
supplies that can accommodate investor needs as the millennium draws to a close.
As for the economy, there are no credit concerns right now. T-bills are at
normal spreads relative to longer maturity instruments. Our outlook is for a
good pace of economic growth coupled with modest inflationary pressures. If
that's the case, we would expect rates to move modestly upward.
Continued
<PAGE> 11
9
Q FRANK, YOU'VE BEEN MANAGING MONEY FUNDS FOR OVER TWENTY YEARS. DO YOU
HAVE ANY CONCERNS ABOUT Y2K?
------------------------------------------------------------------------
A Actually, I think it might present our team with some opportunities. Our
money market funds aren't a training ground for other areas of the firm,
which can be the case in some other companies. We have a staff dedicated
to money market funds who've seen enough to recognize potential trouble spots.
We also have the added advantage of our chief economist's analysis to help guide
our decision-making. A seasoned staff counts in volatile times, and gives you
the potential to spot opportunities and avoid potential pitfalls. We'll apply
these talents through Y2K and whatever lies beyond.
<PAGE> 12
10
TERMS TO KNOW
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7-DAY AVERAGE
YIELD Every money market fund calculates its yield daily
according to a standardized method prescribed by the
Securities and Exchange Commission. Each day's
standardized yield is an average taken over a 7-day
period. This average helps to minimize the effect of
daily fluctuation in fund income, and therefore yield.
MATURITY Maturity is the time remaining before an issuer is
scheduled to repay the principal amount on a debt
security. Money market instruments are debt securities.
FEDERAL FUNDS
("FED FUNDS") Commercial banks are required to keep these funds on
deposit at the Federal Reserve Bank in their district.
In order to meet these reserve requirements,
occasionally commercial banks need to borrow funds.
These funds are borrowed from banks that have an excess
of the required amount on hand in what is called the
"Fed Funds Market". The interest rate on these loans is
called the "Fed Funds Rate" and is the key money market
rate which influences all other short-term rates.
U.S. TREASURIES These debt securities are issued by the U.S. Treasury
and include Treasury bills, Treasury notes and Treasury
bonds. They are considered to be the safest of all
securities. Their safety rests in the power of the U.S.
government to obtain tax revenues in order to repay its
obligations, and in its historical record of always
having done so.
<PAGE> 13
11
Y2K Throughout the world there is an issue with computer
programs that may be unable to process data with dates
using "00" to signify the year 2000. Zurich Money Funds'
investment advisor, Scudder Kemper Investments, is among
the millions of companies that are working to correct
this problem within their organizations and suppliers.
While these efforts are designed to fix the problem,
there are no guarantees that the Year 2000 will not
cause problems for computer systems around the world.
This constitutes a Year 2000 Readiness Disclosure under
the Year 2000 Information and Readiness Disclosure Act
of 1998.
<PAGE> 14
12
PORTFOLIO COMPOSITION
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Zurich Money Market Fund
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
On 7/31/99*
<S> <C>
- - First Tier Commercial Paper 81%
- ------------------------------------------------
- - Domestic CDs and Bank 18%
Acceptance Notes
- ------------------------------------------------
- - U.S. Government Agency Notes 1%
- ------------------------------------------------
Total 100%
- ------------------------------------------------
WEIGHTED AVERAGE MATURITY+
- ------------------------------------------------
Zurich Money Market Fund 28 days
- ------------------------------------------------
First Tier Money Fund Average 53 days
</TABLE>
[PIE CHART]
ON 7/31/99
- --------------------------------------------------------------------------------
ZURICH GOVERNMENT MONEY FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
On 7/31/99*
<S> <C>
- - Federal Agency Notes 59%
- ------------------------------------------------
- - Repurchase Agreements 41%
- ------------------------------------------------
Total 100%
- ------------------------------------------------
WEIGHTED AVERAGE MATURITY+
- ------------------------------------------------
Zurich Government Money Fund 29 days
- ------------------------------------------------
Government Money Fund Average 49 days
</TABLE>
[PIE CHART]
ON 7/31/99
- --------------------------------------------------------------------------------
ZURICH TAX-FREE MONEY FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
On 7/31/99*
<S> <C>
- - Variable Rate Demand Notes 55%
- ------------------------------------------------
- - Tax-exempt Commercial Paper 45%
- ------------------------------------------------
Total 100%
- ------------------------------------------------
WEIGHTED AVERAGE MATURITY+
- ------------------------------------------------
Zurich Tax-Free Money Fund 23 days
- ------------------------------------------------
Tax-Free Money Fund Average 41 days
</TABLE>
* Portfolio composition and holdings are subject to change.
+ The Funds are compared to their respective IBC Financial Data category: The
First Tier Money Fund Average consists of all non-institutional taxable money
market funds investing in only first tier (highest rating) securities and
tracked by IBC Financial Data; Government Money Fund Average includes all
non-institutional government money market funds tracked by IBC Financial Data;
Tax-Free Money Fund Average consists of all non-institutional tax-free money
market funds tracked by IBC Financial Data.
Weighted average maturity data is as of 7/27/99.
<PAGE> 15
13
ZURICH MONEY MARKET FUND
PORTFOLIO OF INVESTMENTS
July 31, 1999 (value in thousands)
<TABLE>
<CAPTION>
---------------------------------------------------------------------------
COMMERCIAL PAPER RATE MATURITY VALUE
---------------------------------------------------------------------------
<S> <C> <C> <C>
ABN-AMRO Finance 4.94% 8/31/99 $ 39,837
---------------------------------------------------------------------------
Ace Overseas Corp. 5.14% - 5.15% 8/10/99 - 8/27/99 44,881
---------------------------------------------------------------------------
AES Shady Point, Inc. 5.12% 8/10/99 - 8/26/99 44,875
---------------------------------------------------------------------------
Alpine Securitization 5.13% - 5.14% 8/12/99 - 8/13/99 54,908
Corp.
---------------------------------------------------------------------------
American Express Credit 5.15% 9/14/99 74,533
Corp.
---------------------------------------------------------------------------
American General Finance 4.96% - 5.14% 8/23/99 - 8/31/99 44,840
Corp.
---------------------------------------------------------------------------
American Home Products 4.87% - 4.96% 8/19/99 - 8/23/99 44,886
Corp.
---------------------------------------------------------------------------
(a)American Honda Finance 5.14% 9/22/99 29,992
Corp.
---------------------------------------------------------------------------
Amsterdam Funding Corp. 5.13% - 5.18% 8/12/99 - 9/10/99 54,831
---------------------------------------------------------------------------
(a)Anheuser-Busch Cos. 5.08% 8/16/99 39,969
---------------------------------------------------------------------------
Asset Portfolio Funding 4.87% 8/4/99 25,990
---------------------------------------------------------------------------
Asset Securitization
Cooperative Corp. 5.12% - 5.14% 8/25/99 - 8/30/99 39,853
---------------------------------------------------------------------------
Associates First Capital 5.17% 9/16/99 14,902
---------------------------------------------------------------------------
Atlantis One Funding Corp. 4.98% 8/2/99 24,997
---------------------------------------------------------------------------
Bank of Nova Scotia 4.95% 8/11/99 39,946
---------------------------------------------------------------------------
Barton Capital Corp. 5.14% 8/12/99 - 8/13/99 44,925
---------------------------------------------------------------------------
Baxter International, Inc. 5.89% - 5.92% 1/26/00 - 1/27/00 38,866
---------------------------------------------------------------------------
(a)Bear Stearns Cos., Inc. 5.15% - 5.35% 8/8/99 - 8/18/99 53,000
---------------------------------------------------------------------------
Beta Finance, Inc. 5.17% 9/15/99 24,841
---------------------------------------------------------------------------
Texas, Brazos River 4.88% - 5.00% 8/10/99 - 8/17/99 55,000
Authority
---------------------------------------------------------------------------
California Pollution
Control Financing 4.88% - 4.92% 8/2/99 - 8/10/99 45,000
Authority
---------------------------------------------------------------------------
(a)Caterpillar Financial 5.00% 8/16/99 24,995
Services
---------------------------------------------------------------------------
Centric Capital Corp. 4.94% - 5.14% 8/23/99 - 8/30/99 44,835
---------------------------------------------------------------------------
China Merchants, Inc. 4.96% - 5.19% 8/20/99 - 9/24/99 23,643
---------------------------------------------------------------------------
(a)Chrysler Financial Co., 5.15% 8/16/99 15,000
L.L.C.
---------------------------------------------------------------------------
Ciesco, L.P. 5.15% 9/21/99 29,783
---------------------------------------------------------------------------
</TABLE>
<PAGE> 16
14
ZURICH MONEY MARKET FUND PORTFOLIO OF INVESTMENTS, CONTINUED
(value in thousands)
<TABLE>
<CAPTION>
---------------------------------------------------------------------------
RATE MATURITY VALUE
---------------------------------------------------------------------------
<S> <C> <C> <C>
(a)CIT Group Holdings 5.09% - 5.29% 8/1/99 - 10/14/99 $ 54,990
---------------------------------------------------------------------------
Citicorp 5.12% 8/25/99 39,864
---------------------------------------------------------------------------
Clipper Receivables Corp. 5.12% - 5.13% 8/2/99 - 8/3/99 24,995
---------------------------------------------------------------------------
Coca-Cola Enterprises 5.15% - 5.18% 9/10/99 - 9/13/99 32,803
---------------------------------------------------------------------------
COFCO Capital Corp. 5.15% 8/25/99 34,880
---------------------------------------------------------------------------
Commercial Credit Co. 5.13% 8/24/99 19,935
---------------------------------------------------------------------------
Corporate Asset Funding 5.13% 8/11/99 39,943
---------------------------------------------------------------------------
Corporate Receivables 5.12% - 5.17% 8/5/99 - 9/13/99 59,851
Corp.
---------------------------------------------------------------------------
Countrywide Home Loans, 5.15% 8/27/99 19,926
Inc.
---------------------------------------------------------------------------
(a)Countrywide Home Loans, 5.56% 10/26/99 20,000
Inc.
---------------------------------------------------------------------------
CXC, Inc. 4.92% - 5.13% 8/2/99 - 8/12/99 34,960
---------------------------------------------------------------------------
(a)DaimlerChrysler N.A. 5.06% 8/1/99 49,944
---------------------------------------------------------------------------
DaimlerChrysler N.A. 4.97% 8/23/99 19,940
---------------------------------------------------------------------------
Delaware Funding Corp. 5.14% 8/23/99 34,891
---------------------------------------------------------------------------
Den Danske Corp. 4.91% 8/16/99 49,899
---------------------------------------------------------------------------
Dresdner U.S. Finance, 4.87% 8/11/99 24,967
Inc.
---------------------------------------------------------------------------
Duke Capital Corp. 5.13% - 5.14% 8/5/99 - 8/18/99 44,929
---------------------------------------------------------------------------
Enterprise Funding Corp. 4.94% - 5.14% 8/12/99 - 8/26/99 39,890
---------------------------------------------------------------------------
Eureka Securitization, 5.13% 8/16/99 39,915
Inc.
---------------------------------------------------------------------------
Fairway Finance Corp. 4.96% 8/16/99 24,949
---------------------------------------------------------------------------
Falcon Asset 5.13% - 5.14% 8/16/99 - 9/1/99 44,842
Securitization Corp.
---------------------------------------------------------------------------
FCAR Owner Trust 5.13% 8/17/99 34,921
---------------------------------------------------------------------------
(a)FINOVA Capital Corp. 5.15% 9/13/99 60,000
---------------------------------------------------------------------------
Ford Motor Credit Co. 5.17% 9/13/99 34,785
---------------------------------------------------------------------------
Fountain Square Commercial 5.13% - 5.27% 8/10/99 - 10/27/99 23,352
Funding
---------------------------------------------------------------------------
(a)GE Capital Corp 5.05% - 5.25% 9/8/99 - 10/12/99 50,000
---------------------------------------------------------------------------
</TABLE>
<PAGE> 17
15
<TABLE>
<CAPTION>
--------------------------------------------------------------------------
RATE MATURITY VALUE
--------------------------------------------------------------------------
<S> <C> <C> <C>
General Electric Co. 5.14% 8/31/99 $ 59,745
--------------------------------------------------------------------------
Giro Funding Corp. 5.13% - 5.16% 8/19/99 - 9/22/99 38,779
--------------------------------------------------------------------------
(b)GMAC Mortgage Corp. of 5.30% 8/2/99 49,993
Pennsylvania
--------------------------------------------------------------------------
(a)Goldman Sachs Group, 5.18% 8/8/99 45,000
L.P.
--------------------------------------------------------------------------
GTE Funding, Inc. 5.06% - 5.14% 8/5/99 - 8/20/99 37,957
--------------------------------------------------------------------------
(a)Heller Financial, Inc. 5.53% 10/7/99 30,032
--------------------------------------------------------------------------
(a)Household Finance Corp. 5.25% 8/10/99 15,006
--------------------------------------------------------------------------
Household Finance Corp. 4.92% 8/18/99 14,966
--------------------------------------------------------------------------
Household International, 5.02% 8/30/99 19,920
Inc.
--------------------------------------------------------------------------
IBM Corp. 5.13% 3/22/00 14,995
--------------------------------------------------------------------------
New Hampshire, Industrial 5.13% 8/18/99 30,000
Development Authority
--------------------------------------------------------------------------
International 4.96% - 5.35% 8/30/99 - 9/30/99 34,813
Securitization Corp.
--------------------------------------------------------------------------
Intrepid Funding Master 4.93% 9/20/99 44,697
Trust
--------------------------------------------------------------------------
(a)John Deere Capital 5.05% 9/10/99 49,999
Corp.
--------------------------------------------------------------------------
Kitty Hawk Funding Corp. 5.13% - 5.17% 8/13/99 - 9/7/99 39,861
--------------------------------------------------------------------------
Knight Ridder, Inc. 5.19% 9/27/99 35,409
--------------------------------------------------------------------------
Lehman Brothers Holdings, 5.27% 9/20/99 44,675
Inc.
--------------------------------------------------------------------------
Lexington Parket Capital 5.15% 8/5/99 44,974
Co.
--------------------------------------------------------------------------
Merita N.A., Inc. 5.14% - 5.25% 8/9/99 - 10/25/99 44,616
--------------------------------------------------------------------------
(a)Merrill Lynch & Co. 5.16% 8/21/99 35,000
--------------------------------------------------------------------------
Moat Funding, L.L.C. 5.18% - 5.33% 8/4/99 - 9/9/99 69,836
--------------------------------------------------------------------------
Mont Blanc Capital Corp. 5.13% - 5.14% 8/18/99 - 8/19/99 44,889
--------------------------------------------------------------------------
Monte Rosa Capital Corp. 5.13% - 5.15% 8/3/99 - 8/20/99 39,946
--------------------------------------------------------------------------
Moriarty, L.L.C. 5.04%+C48 9/7/99 44,770
--------------------------------------------------------------------------
(a)National Rural
Utilities Cooperative 5.18% 8/2/99 - 9/25/99 49,996
Finance Corp.
--------------------------------------------------------------------------
</TABLE>
<PAGE> 18
16
ZURICH MONEY MARKET FUND PORTFOLIO OF INVESTMENTS, CONTINUED
(value in thousands)
<TABLE>
<CAPTION>
--------------------------------------------------------------------------
RATE MATURITY VALUE
--------------------------------------------------------------------------
<S> <C> <C> <C>
National Rural Utilities 4.91% 8/23/99 $ 9,970
Cooperative Finance Corp.
--------------------------------------------------------------------------
New Center Asset Trust 5.16% 9/2/99 49,772
--------------------------------------------------------------------------
Nordebanken N.A. 4.90% 8/9/99 49,946
--------------------------------------------------------------------------
Oakland - Alameda County, 5.12% 8/18/99 50,000
Coliseum Authority
--------------------------------------------------------------------------
Old Line Funding 4.88% 8/11/99 9,987
--------------------------------------------------------------------------
Park Avenue Receivables 5.16% - 5.18% 9/8/99 - 9/22/99 44,726
Corp.
--------------------------------------------------------------------------
Pemex Capital, Inc 5.27% 9/20/99 29,783
--------------------------------------------------------------------------
Preferred Receivables
Funding Corp. 5.12% 8/10/99 32,958
--------------------------------------------------------------------------
Prudential Funding Corp. 4.92% 8/24/99 59,814
--------------------------------------------------------------------------
Quincy Capital Corp. 5.12% - 5.13% 8/10/99 - 8/17/99 39,929
--------------------------------------------------------------------------
Receivables Capital Corp. 5.17% - 5.24% 9/8/99 - 10/7/99 44,651
--------------------------------------------------------------------------
(a)Sanwa Business Credit 5.16% - 5.25% 8/9/99 - 9/14/99 50,044
Co.
--------------------------------------------------------------------------
Sears Roebuck Acceptance 5.14% - 5.18% 8/12/99 - 9/7/99 49,810
Corp.
--------------------------------------------------------------------------
Sheffield Receivables 4.94% - 5.14% 8/19/99 - 8/24/99 39,889
Corp.
--------------------------------------------------------------------------
Sigma Finance, Corp. 4.89% 8/11/99 13,981
--------------------------------------------------------------------------
(a)Sigma Finance, Corp. 5.15% - 5.18% 8/15/99 - 8/28/99 40,000
--------------------------------------------------------------------------
Skandinaviska Enskilda 5.12% 8/9/99 29,966
Banken
--------------------------------------------------------------------------
Societe Generale N.A. 4.94% 8/17/99 - 8/25/99 59,842
--------------------------------------------------------------------------
Sony Capital Corp. 5.09% 8/6/99 27,351
--------------------------------------------------------------------------
Spintab SwedMortgage 4.92% 9/10/99 44,759
--------------------------------------------------------------------------
Swedbank, Inc. 4.91% 8/16/99 49,899
--------------------------------------------------------------------------
Thunder Bay Funding, Inc. 5.04% - 5.14% 8/5/99 - 8/6/99 44,970
--------------------------------------------------------------------------
(a)TransAmerica Finance 5.05% - 5.56% 8/11/99 - 10/22/99 65,000
Corp.
--------------------------------------------------------------------------
Twin Tower, Inc. 5.14% - 5.20% 8/16/99 - 9/13/99 39,862
--------------------------------------------------------------------------
U.S. West Communications 5.17% 8/17/99 15,838
--------------------------------------------------------------------------
</TABLE>
<PAGE> 19
17
<TABLE>
<CAPTION>
--------------------------------------------------------------------------
RATE MATURITY VALUE
--------------------------------------------------------------------------
<S> <C> <C> <C>
UBS Finance, Inc. 5.04% 12/20/99 - 12/22/99 $ 39,229
--------------------------------------------------------------------------
Variable Funding Capital 5.15% 8/19/99 44,885
Corp.
--------------------------------------------------------------------------
WCP Funding, Inc. 5.14% - 5.22% 8/2/99 - 10/6/99 44,716
--------------------------------------------------------------------------
Windmill Funding Corp. 4.97% - 5.17% 8/4/99 - 9/22/99 49,870
--------------------------------------------------------------------------
Wood Street Funding Corp. 5.13% - 5.15% 8/9/99 - 8/31/99 39,886
--------------------------------------------------------------------------
Xerox Capital Europe, PLC 4.92% 8/20/99 24,999
--------------------------------------------------------------------------
TOTAL COMMERCIAL PAPER -- 81.8%
(AVERAGE MATURITY: 29 DAYS) 4,194,705
--------------------------------------------------------------------------
CERTIFICATES OF DEPOSIT
--------------------------------------------------------------------------
(a)American Honda Finance 5.19% 8/24/99 19,997
Corp.
--------------------------------------------------------------------------
(a)AMEX Centurian Bank 5.15% - 5.17% 8/15/99 - 8/22/99 40,000
--------------------------------------------------------------------------
(a)Bank of Montreal 5.15% 8/1/99 49,982
--------------------------------------------------------------------------
(a)BankAmerica 5.25% 8/1/99 50,000
--------------------------------------------------------------------------
(a)Canadian Imperial Bank 5.19% 10/7/99 39,979
--------------------------------------------------------------------------
(a)Caterpillar Financial 5.00% 8/11/99 20,005
Services
--------------------------------------------------------------------------
(a)Comerica Bank, Inc. 5.15% 8/1/99 44,987
--------------------------------------------------------------------------
(a)First National Bank of 5.14% - 5.31% 8/1/99 - 10/07/99 55,000
Boston
--------------------------------------------------------------------------
(a)First Union National 5.23% 8/17/99 50,000
Bank
--------------------------------------------------------------------------
(a)Harris Trust and 5.16% 8/1/99 39,989
Savings Bank
--------------------------------------------------------------------------
(a)Heller Financial, Inc. 5.20% 9/7/99 25,020
--------------------------------------------------------------------------
(a)J.P. Morgan & Co., Inc. 5.03% 8/03/99 45,000
--------------------------------------------------------------------------
(a)Key Bank N.A. 5.13% 8/29/99 54,995
--------------------------------------------------------------------------
(a)MBNA America Bank N.A. 5.12% 8/9/99 15,000
--------------------------------------------------------------------------
(a)National City Bank of 5.39% 10/7/99 45,044
Kentucky
--------------------------------------------------------------------------
(a)Northern Trust Corp. 5.07% 8/8/99 54,997
--------------------------------------------------------------------------
(a)Old Kent Bank 4.94% 9/16/99 74,974
--------------------------------------------------------------------------
</TABLE>
<PAGE> 20
18
ZURICH MONEY MARKET FUND PORTFOLIO OF INVESTMENTS, CONTINUED
(value in thousands)
<TABLE>
<CAPTION>
-----------------------------------------------------------------------
RATE MATURITY VALUE
-----------------------------------------------------------------------
<S> <C> <C> <C>
(a)PNC Bank N.A. 5.14% - 5.23% 8/4/99 - 8/28/99 $ 35,002
-----------------------------------------------------------------------
(a)Royal Bank of Canada 5.14% 8/1/99 34,986
-----------------------------------------------------------------------
Toronto Dominion Bank 5.05% 8/13/99 15,000
-----------------------------------------------------------------------
(a)U.S. Bank N.A. 5.13% - 5.15% 8/21/99 44,988
-----------------------------------------------------------------------
(a)Wells Fargo & Co. 5.17% 9/29/99 49,975
-----------------------------------------------------------------------
TOTAL CERTIFICATES OF DEPOSIT -- 17.6%
(AVERAGE MATURITY: 20 DAYS) 904,920
-----------------------------------------------------------------------
U.S. GOVERNMENT AGENCY NOTES
-----------------------------------------------------------------------
(a)Federal Home Loan Bank 5.05% 8/1/99 9,997
-----------------------------------------------------------------------
(a)Student Loan Marketing 4.92% 8/3/99 19,962
Association
-----------------------------------------------------------------------
TOTAL U.S. GOVERNMENT AGENCY NOTES -- 0.6%
(AVERAGE MATURITY: 2 DAYS) 29,959
-----------------------------------------------------------------------
TOTAL INVESTMENTS PORTFOLIO -- 100%
(AVERAGE MATURITY: 28 DAYS) $5,129,584
</TABLE>
SEE ACCOMPANYING NOTES TO PORTFOLIOS OF INVESTMENTS.
<PAGE> 21
19
ZURICH GOVERNMENT MONEY FUND
PORTFOLIO OF INVESTMENTS
July 31, 1999 (value in thousands)
<TABLE>
<CAPTION>
--------------------------------------------------------------------------
SHORT-TERM NOTES RATE MATURITY VALUE
--------------------------------------------------------------------------
<S> <C> <C> <C>
(ISSUED OR GUARANTEED BY U.S. GOVERNMENT AGENCIES OR
INSTRUMENTALITIES)
(a)Agency for
International Development
Government of Israel 5.47% 8/3/99 $ 914
--------------------------------------------------------------------------
(a)Export-Import Bank of
the United States
Kuwait Investment 5.52% 8/15/99 3,807
Authority
--------------------------------------------------------------------------
(a)Federal Farm Credit 5.10% 8/1/99 4,999
Bank
--------------------------------------------------------------------------
Federal Home Loan Bank (a)5.02% - 5.10% 8/1/99 - 8/28/99 93,965
5.03% - 5.12% 10/29/99 - 05/17/00 39,000
--------------------------------------------------------------------------
Federal Home Loan Mortgage (a)4.98% 8/18/99 29,981
Corp. 4.82% - 4.89% 8/18/99 - 11/18/99 85,008
--------------------------------------------------------------------------
Federal National Mortgage (a)4.91% 9/16/99 9,993
Association 4.80% - 5.04% 8/24/99 - 2/23/00 39,060
--------------------------------------------------------------------------
(a)Overseas Private
Investment Corp. Omolon 5.31% 8/3/99 15,418
International Paper Co. 5.26% 10/15/99 2,400
--------------------------------------------------------------------------
(a)Student Loan Marketing 4.92% - 5.31% 8/1/99 - 8/3/99 90,413
Association
--------------------------------------------------------------------------
TOTAL SHORT-TERM NOTES -- 58.6%
(AVERAGE MATURITY: 37 DAYS) 414,958
</TABLE>
<PAGE> 22
20
ZURICH GOVERNMENT MONEY FUND PORTFOLIO OF INVESTMENTS, CONTINUED
<TABLE>
<CAPTION>
------------------------------------------------------------------------
(c) REPURCHASE AGREEMENTS RATE MATURITY VALUE
------------------------------------------------------------------------
<S> <C> <C> <C>
(DATED 6/99 AND 7/99, COLLATERALIZED BY FEDERAL HOME LOAN
MORTGAGE CORPORATION AND FEDERAL NATIONAL MORTGAGE ASSOCIATION
SECURITIES)
Bear, Stearns Cos., Inc. 5.07% 8/4/99 105,000
(held at The Bank of New
York)
------------------------------------------------------------------------
Donaldson, Lufkin &
Jenrette Securities Corp.
(held at The Bank of New 5.02% - 5.04% 8/2/99 - 8/25/99 53,000
York)
------------------------------------------------------------------------
Morgan Stanley Dean Witter
Discover & Co. (held at
The Bank of New York) 4.96% - 5.11% 8/5/99 - 8/30/99 57,000
------------------------------------------------------------------------
Salomon Smith Barney
Holdings, Inc.
(held at The Bank of New 5.06% 8/16/99 76,000
York)
------------------------------------------------------------------------
State Street Bank and
Trust Company 5.04% 8/2/99 2,200
------------------------------------------------------------------------
TOTAL REPURCHASE AGREEMENTS -- 41.4%
(AVERAGE MATURITY: 12 DAYS) 293,200
------------------------------------------------------------------------
TOTAL INVESTMENTS PORTFOLIO -- 100%
(AVERAGE MATURITY: 27 DAYS) $708,158
</TABLE>
SEE ACCOMPANYING NOTES TO PORTFOLIOS OF INVESTMENTS.
<PAGE> 23
21
ZURICH TAX-FREE MONEY FUND
PORTFOLIO OF INVESTMENTS
July 31, 1999 (value in thousands)
<TABLE>
<CAPTION>
------------------------------------------------------------------------
(a) VARIABLE RATE DEMAND SECURITIES
------------------------------------------------------------------------
ARIZONA RATE VALUE
------------------------------------------------------------------------
<S> <C> <C>
Apache County, Industrial Development 3.20% $ 10,000
Authority
------------------------------------------------------------------------
Maricopa County, Pollution Control Revenue 3.10% 9,000
------------------------------------------------------------------------
CALIFORNIA
------------------------------------------------------------------------
Los Angeles, Harbor Improvement Corp. 3.30% 11,200
------------------------------------------------------------------------
Statewide Communities Development Authority 4.37% 5,000
------------------------------------------------------------------------
DISTRICT OF COLUMBIA
------------------------------------------------------------------------
General Obligation 3.45% - 3.50% 17,720
------------------------------------------------------------------------
The Washington Home, Inc. 3.20% 5,575
------------------------------------------------------------------------
FLORIDA
------------------------------------------------------------------------
Broward County, Industrial Development 3.40% 5,770
Authority
------------------------------------------------------------------------
Hillsborough County, Industrial Development 3.50% 4,500
Authority
------------------------------------------------------------------------
Orange County, Health Facilities Authority 3.25% 7,700
------------------------------------------------------------------------
Putnam County, Pollution Control Revenue 3.20% 1,250
------------------------------------------------------------------------
Sarasota County, Health Facilities
Authority 3.25% 4,500
------------------------------------------------------------------------
GEORGIA
------------------------------------------------------------------------
Burke County, Pollution Control Revenue 3.30% 2,500
------------------------------------------------------------------------
Cartersville, Industrial Development 3.60% 3,600
Revenue
------------------------------------------------------------------------
</TABLE>
<PAGE> 24
22
ZURICH TAX-FREE MONEY FUND PORTFOLIO OF INVESTMENTS, CONTINUED
(value in thousands)
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------
RATE VALUE
- -------------------------------------------------------------------------
<S> <C> <C>
Fayette County, Educational Facilities 3.15% $ 7,035
Authority
------------------------------------------------------------------------
Gainsville Redevelopment Authority 3.15% 10,000
- -------------------------------------------------------------------------
ILLINOIS
- -------------------------------------------------------------------------
Development Finance Authority 3.20% - 3.37% 24,620
------------------------------------------------------------------------
Chicago, Industrial Development Revenue 3.40% 3,400
------------------------------------------------------------------------
Cicero, Industrial Development Revenue 3.40% 2,890
------------------------------------------------------------------------
Health Facilities Authority 3.20% 8,180
------------------------------------------------------------------------
Hillside, Economic Development Authority 3.30% 5,520
------------------------------------------------------------------------
McHenry, Industrial Development Revenue 3.30% 5,500
------------------------------------------------------------------------
Mundelein-MacLean, Industrial Development 3.30% 6,500
Revenue
------------------------------------------------------------------------
Springfield, Industrial Development Revenue 3.37% 6,500
------------------------------------------------------------------------
Student Assistance Commission, Student Loan 3.25% 6,500
Revenue
------------------------------------------------------------------------
Woodridge, Industrial Development Revenue 3.40% 5,100
------------------------------------------------------------------------
Woodstock, Industrial Development Revenue 3.37% 5,240
- -------------------------------------------------------------------------
INDIANA
- -------------------------------------------------------------------------
Health Facilities Authority 3.15% 4,750
------------------------------------------------------------------------
Jasper County, Pollution Control Revenue 3.45% 6,500
------------------------------------------------------------------------
</TABLE>
<PAGE> 25
23
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------
RATE VALUE
- -------------------------------------------------------------------------
<S> <C> <C>
Ossian, Economic Development Authority 3.25% $ 4,700
------------------------------------------------------------------------
Rockport, Pollution Control Revenue 3.20% 10,000
- -------------------------------------------------------------------------
KENTUCKY
- -------------------------------------------------------------------------
Lexington-Fayette, Industrial Building 3.70% 4,200
Revenue
------------------------------------------------------------------------
Mason County, Pollution Control Revenue 3.20% 18,500
------------------------------------------------------------------------
Mayfield, Educational Facilities Authority 3.25% 11,200
- -------------------------------------------------------------------------
LOUISIANA
- -------------------------------------------------------------------------
Caddo Parish, Industrial Development Board 3.25% 8,500
------------------------------------------------------------------------
Public Facilities Authority 3.25% 5,400
- -------------------------------------------------------------------------
MARYLAND
- -------------------------------------------------------------------------
Baltimore County, Oak Crest Village Project 3.15% 5,800
- -------------------------------------------------------------------------
MICHIGAN
- -------------------------------------------------------------------------
University of Michigan 3.45% 9,100
- -------------------------------------------------------------------------
MISSOURI
- -------------------------------------------------------------------------
Environment Improvement & Energy 3.20% 5,550
- -------------------------------------------------------------------------
NORTH CAROLINA
- -------------------------------------------------------------------------
Medical Care Commission, Retirement
Community Revenue 3.15% 5,000
------------------------------------------------------------------------
Wake County, Industrial Financing Authority 3.05% 3,900
- -------------------------------------------------------------------------
NORTH DAKOTA
- -------------------------------------------------------------------------
Mercer County, Pollution Control Revenue 3.20% 6,400
</TABLE>
<PAGE> 26
24
ZURICH TAX-FREE MONEY FUND PORTFOLIO OF INVESTMENTS, CONTINUED
(value in thousands)
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------
NEW MEXICO RATE VALUE
- --------------------------------------------------------------------------
<S> <C> <C>
Belen, Industrial Development Revenue 3.37% $ 4,510
-------------------------------------------------------------------------
Farmington, El Paso Electric Co. Project 3.10% 6,300
- --------------------------------------------------------------------------
NEVADA
- --------------------------------------------------------------------------
Department of Commerce 3.35% 4,650
- --------------------------------------------------------------------------
OHIO
- --------------------------------------------------------------------------
Portage County, Industrial Development
Revenue 3.37% 4,800
- --------------------------------------------------------------------------
PENNSYLVANIA
- --------------------------------------------------------------------------
Allentown, Area Hospital Authority 3.20% 6,930
-------------------------------------------------------------------------
Higher Education Assistance Agency,
University of Pennsylvania Health Services 3.30% 19,000
Project
-------------------------------------------------------------------------
Lancaster County, Hospital Finance 3.21% 5,000
Authority
-------------------------------------------------------------------------
Philadelphia, Industrial Development
Authority 3.20% - 3.55% 14,270
- --------------------------------------------------------------------------
TENNESSEE
- --------------------------------------------------------------------------
Clarksville, Public Building Authority 3.20% 8,320
-------------------------------------------------------------------------
Maury County, Saturn Corporation Project 3.15% 2,500
- --------------------------------------------------------------------------
TEXAS
- --------------------------------------------------------------------------
Harris County, Health Facilities Authority 3.45% 13,200
-------------------------------------------------------------------------
Texas Small Business Industrial Development
Corp. 3.20% 7,000
- --------------------------------------------------------------------------
VIRGINIA
- --------------------------------------------------------------------------
Loudoun County, Industrial Development
Authority 3.30% 5,915
</TABLE>
<PAGE> 27
25
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------
WASHINGTON RATE VALUE
- ------------------------------------------------------------------------
<S> <C> <C>
Port of Vancouver 3.20% $ 8,850
- ------------------------------------------------------------------------
WISCONSIN
- ------------------------------------------------------------------------
Eau Claire,
Solid Waste Disposal Revenue 3.35% 10,000
- ------------------------------------------------------------------------
Health and Education Facilities Authority 3.05% 13,000
- ------------------------------------------------------------------------
Manitowoc, Industrial Development Revenue 3.37% 4,200
- ------------------------------------------------------------------------
TOTAL VARIABLE RATE DEMAND SECURITIES -- 54.9%
(AVERAGE MATURITY: 6 DAYS) 433,245
</TABLE>
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------
OTHER SECURITIES
- --------------------------------------------------------------------------
ARIZONA RATE MATURITY VALUE
- --------------------------------------------------------------------------
<S> <C> <C> <C>
Salt River Project,
Agricultural Improvement
and Power District 3.20% 8/16/99 $ 8,000
- --------------------------------------------------------------------------
COLORADO
- --------------------------------------------------------------------------
Platte River, Power
Authority 3.25% 8/17/99 -8/19/99 11,100
- --------------------------------------------------------------------------
FLORIDA
- --------------------------------------------------------------------------
Jacksonville, Electric 3.30% 9/10/99 - 9/16/99 11,150
Authority
- --------------------------------------------------------------------------
Municipal Power Agency 3.30% 9/20/99 3,940
- --------------------------------------------------------------------------
Orlando, Capital
Improvements Authority 3.30% 9/10/99 4,500
- --------------------------------------------------------------------------
Sunshine State Governmental
Financing Commission 3.20% 8/17/99 8,500
- --------------------------------------------------------------------------
GEORGIA
- --------------------------------------------------------------------------
Municipal Electric
Authority 3.20% 9/21/99 6,650
</TABLE>
<PAGE> 28
26
ZURICH TAX-FREE MONEY FUND PORTFOLIO OF INVESTMENTS, CONTINUED
(value in thousands)
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------
ILLINOIS RATE MATURITY VALUE
- -------------------------------------------------------------------------------
<S> <C> <C> <C>
Educational Facilities 3.25% - 3.35% 8/12/99 - 10/14/99 $ 18,160
Authority
- -------------------------------------------------------------------------------
Health Facilities Authority 3.25% - 3.35% 9/7/99 - 10/1/99 10,350
- -------------------------------------------------------------------------------
INDIANA
- -------------------------------------------------------------------------------
Jasper County, Industrial
Pollution Control Revenue 3.25% - 3.35% 8/11/99 - 10/21/99 18,000
- -------------------------------------------------------------------------------
KENTUCKY
- -------------------------------------------------------------------------------
Danville, Multi-County
Lease Revenue 3.35% 9/13/99 7,000
- -------------------------------------------------------------------------------
Pendleton City,
Multi-County Lease Revenue 3.30% - 3.40% 9/15/99 - 10/13/99 23,880
- -------------------------------------------------------------------------------
LOUISIANA
- -------------------------------------------------------------------------------
Public Facilities Authority 3.35% 8/27/99 6,000
- -------------------------------------------------------------------------------
West Baton Rouge,
Industrial Development
Authority 3.25% - 3.30% 8/9/99 - 8/10/99 8,050
- -------------------------------------------------------------------------------
MARYLAND
- -------------------------------------------------------------------------------
Anne Arundel County, Port
Facilities Revenue 3.30% 8/12/99 - 9/14/99 14,400
- -------------------------------------------------------------------------------
MICHIGAN
- -------------------------------------------------------------------------------
Strategic Fund, Continental
Aluminum Project 3.25% - 3.30% 8/9/99 - 8/16/99 13,670
- -------------------------------------------------------------------------------
University of Michigan 3.15% 8/12/99 3,000
- -------------------------------------------------------------------------------
NEVADA
- -------------------------------------------------------------------------------
Las Vegas Valley, Water &
Power Authority 3.25% - 3.30% 8/12/99 - 9/20/99 17,000
- -------------------------------------------------------------------------------
NEW HAMPSHIRE
- -------------------------------------------------------------------------------
Business Finance Authority 3.25% 8/18/99 5,000
</TABLE>
<PAGE> 29
27
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------
NEW YORK RATE MATURITY VALUE
- -------------------------------------------------------------------------------
<S> <C> <C> <C>
Nassau County, Tax
Anticipation Note 3.50% 8/18/99 - 12/22/99 $ 11,507
- -------------------------------------------------------------------------------
OHIO
- -------------------------------------------------------------------------------
Water Development Authority 3.20% - 3.25% 8/13/99 7,085
- -------------------------------------------------------------------------------
PENNSYLVANIA
- -------------------------------------------------------------------------------
Allegheny County, Housing 3.35% 8/10/99 4,500
Development Corp.
- -------------------------------------------------------------------------------
Philadelphia, Tax and
Revenue Anticipation Notes 4.25% 6/30/00 5,838
- -------------------------------------------------------------------------------
SOUTH CAROLINA
- -------------------------------------------------------------------------------
Public Service Authority 3.20% 8/12/99 7,000
- -------------------------------------------------------------------------------
TEXAS
- -------------------------------------------------------------------------------
Municipal Power Agency 3.20% - 3.35% 8/12/99 - 9/15/99 26,500
- -------------------------------------------------------------------------------
Public Finance Authority 3.20% 8/26/99 8,000
- -------------------------------------------------------------------------------
Austin County, Utility 3.30% 9/13/99 - 9/16/99 15,491
Revenue
- -------------------------------------------------------------------------------
Harris County, School 3.35% 8/27/99 3,800
District
- -------------------------------------------------------------------------------
Texas A&M University 3.25% 8/9/99 7,000
- -------------------------------------------------------------------------------
Transportation Authority 4.50% 8/31/99 8,008
- -------------------------------------------------------------------------------
University of Texas 3.30% - 3.35% 8/24/99 - 9/14/99 13,000
- -------------------------------------------------------------------------------
UTAH
- -------------------------------------------------------------------------------
General Obligation Highway 3.20% 8/16/99 3,500
- -------------------------------------------------------------------------------
Intermountain Power Agency 3.30% - 3.35% 8/11/99 - 9/8/99 5,800
</TABLE>
<PAGE> 30
28
ZURICH TAX-FREE MONEY FUND PORTFOLIO OF INVESTMENTS, CONTINUED
(value in thousands)
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------
VIRGINIA RATE MATURITY VALUE
<S> <C> <C> <C>
- ----------------------------------------------------------------------------
Chesapeake, Industrial
Development Authority 3.30% 9/14/99 $ 6,000
- ----------------------------------------------------------------------------
Chesterfield County,
Industrial Development 3.30% 9/10/99 5,200
Authority
- ----------------------------------------------------------------------------
Louisa, Industrial
Development Authority 3.30% - 3.35% 8/17/99 - 9/13/99 10,900
- ----------------------------------------------------------------------------
Peninsula Port, Industrial
Development Authority 3.35% 9/8/99 8,135
- -----------------------------------------------------------------------------
TOTAL OTHER SECURITIES -- 45.1%
(AVERAGE MATURITY: 38 DAYS) 355,614
- -----------------------------------------------------------------------------
TOTAL INVESTMENTS PORTFOLIO -- 100%
(AVERAGE MATURITY: 20 DAYS) $788,859
</TABLE>
SEE ACCOMPANYING NOTES TO PORTFOLIOS OF INVESTMENTS.
<PAGE> 31
29
NOTES TO
PORTFOLIOS OF INVESTMENTS
Interest rates represent annualized yield to date of maturity, except for
variable rate securities described in Note (a). For each security, cost (for
financial reporting and federal income tax purposes) and carrying value are the
same. Likewise, carrying value approximates principal amount.
a) Variable rate securities. The rates shown are the current rates at July 31,
1999. The dates shown represent the demand date or the next interest rate
change date. Securities in the Zurich Tax-Free Money Fund shown without a
date are payable within five business days and are backed by credit support
agreements from banks or insurance institutions.
(b) Illiquid securities. At July 31, 1999, the value of illiquid securities was
$49,993,000 in the Zurich Money Market Fund, which represented 1.0% of net
assets.
(c) Repurchase agreements are fully collateralized by U.S. Government securities
or U.S. Government Agency securities. All collateral is held at the Funds'
custodian bank, State Street Bank and Trust Company, or at subcustodian
banks, as indicated. The collateral is monitored daily by the Funds so that
its market value is at least equal to the minimum carrying value of the
repurchase agreement.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
<PAGE> 32
30
REPORT OF
INDEPENDENT AUDITORS
THE BOARD OF TRUSTEES
AND SHAREHOLDERS
ZURICH MONEY FUNDS We have audited the accompanying statement of
assets and liabilities, including the portfolios of
investments, of Zurich Money Market Fund, Zurich
Government Money Fund and Zurich Tax-Free Money
Fund, comprising Zurich Money Funds, as of July 31,
1999, and the related statements of operations for
the year then ended and changes in net assets for
each of the two years in the period then ended, and
the financial highlights for each of the fiscal
periods since 1995. These financial statements and
financial highlights are the responsibility of the
Funds' management. Our responsibility is to express
an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with
generally accepted auditing standards. Those
standards require that we plan and perform the
audit to obtain reasonable assurance about whether
the financial statements and financial highlights
are free of material misstatement. An audit
includes examining, on a test basis, evidence
supporting the amounts and disclosures in the
financial statements. Our procedures included
confirmation of investments owned as of July 31,
1999, by correspondence with the custodian. An
audit also includes assessing the accounting
principles used and significant estimates made by
management, as well as evaluating the overall
financial statement presentation. We believe that
our audits provide a reasonable basis for our
opinion.
<PAGE> 33
31
In our opinion, the financial statements and
financial highlights referred to above present
fairly, in all material respects, the financial
position of each of the Funds comprising Zurich
Money Funds at July 31, 1999, the results of their
operations for the year then ended, the changes in
their net assets for each of the two years in the
period then ended and the financial highlights for
each of the fiscal periods since 1995, in
conformity with generally accepted accounting
principles.
ERNST & YOUNG LLP
Chicago, Illinois
September 16, 1999
<PAGE> 34
32
FINANCIAL STATEMENTS
- -------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
- -------------------------------------------------------------------------------
July 31, 1999
(in thousands)
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------
ASSETS MONEY MARKET GOVERNMENT TAX-FREE
- -------------------------------------------------------------------------------
<S> <C> <C> <C>
- -------------------------------------------------------------------------------
Investments, at amortized
cost:
Short-term securities $5,129,584 414,958 788,859
- -------------------------------------------------------------------------------
Repurchase agreements -- 293,200 --
- -------------------------------------------------------------------------------
Cash 12,374 2,116 4,675
- -------------------------------------------------------------------------------
Receivable for:
Interest 10,297 3,488 2,771
- ------------------------------------------------------------------------------
Investments sold -- -- 1,010
- -------------------------------------------------------------------------------
Fund shares sold 10,781 47 718
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
TOTAL ASSETS 5,163,036 713,809 798,033
- -------------------------------------------------------------------------------
LIABILITIES AND NET ASSETS
- -------------------------------------------------------------------------------
Payable for:
Fund shares redeemed 20,062 971 1,097
- -------------------------------------------------------------------------------
Investments purchased 24,998 -- --
- -------------------------------------------------------------------------------
Dividends 5,181 716 477
- -------------------------------------------------------------------------------
Management fee 1,355 263 232
- -------------------------------------------------------------------------------
Custodian and transfer agent
fees and related expenses 1,050 65 53
- -------------------------------------------------------------------------------
Trustees' fees and other 859 10 115
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
TOTAL LIABILITIES 53,505 2,025 1,974
- -------------------------------------------------------------------------------
NET ASSETS APPLICABLE TO
SHARES OUTSTANDING $5,109,531 711,784 796,059
- -------------------------------------------------------------------------------
THE PRICING OF SHARES
- -------------------------------------------------------------------------------
Shares outstanding 5,109,531 711,784 796,059
- -------------------------------------------------------------------------------
Net asset value and redemption
price per share $1.00 1.00 1.00
</TABLE>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
<PAGE> 35
33
- -------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
- -------------------------------------------------------------------------------
Year ended July 31, 1999
(in thousands)
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------
NET INVESTMENT INCOME MONEY MARKET GOVERNMENT TAX-FREE
- -------------------------------------------------------------------------------
<S> <C> <C> <C>
- -------------------------------------------------------------------------------
Interest income $255,131 36,112 26,518
- -------------------------------------------------------------------------------
Expenses:
Management fee 13,106 1,973 2,167
------------------------------------------------------------------------------
Custodian and transfer agent
fees and related expenses 8,215 938 574
------------------------------------------------------------------------------
Trustees' fees 48 11 10
------------------------------------------------------------------------------
Reports to shareholders 569 49 48
------------------------------------------------------------------------------
Registration costs 318 45 72
------------------------------------------------------------------------------
Audit 73 10 12
------------------------------------------------------------------------------
Legal 30 4 4
------------------------------------------------------------------------------
Other 148 -- 15
------------------------------------------------------------------------------
Total expenses 22,507 3,030 2,902
------------------------------------------------------------------------------
Net investment income $232,624 33,082 23,616
</TABLE>
<PAGE> 36
34
ZURICH MONEY FUNDS FINANCIAL STATEMENTS, CONTINUED
Years ended July 31, 1999 and 1998
(in thousands)
- --------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
- ----------------------------------------------------------------
OPERATIONS, DIVIDENDS AND CAPITAL SHARE ACTIVITY
- ----------------------------------------------------------------
<S> <C>
Net investment income
- ----------------------------------------------------------------
Dividends to shareholders from net investment income
- ----------------------------------------------------------------
Capital share transactions
(dollar amounts and number of shares are the same):
Shares sold
- ----------------------------------------------------------------
Shares issued in reinvestment of dividends
- ----------------------------------------------------------------
- ----------------------------------------------------------------
Shares redeemed
- ----------------------------------------------------------------
NET INCREASE (DECREASE) FROM CAPITAL SHARE TRANSACTIONS AND
TOTAL INCREASE (DECREASE) IN NET ASSETS
- ----------------------------------------------------------------
NET ASSETS
- ----------------------------------------------------------------
Beginning of year
- ----------------------------------------------------------------
END OF YEAR
</TABLE>
<PAGE> 37
35
<TABLE>
<CAPTION>
MONEY MARKET GOVERNMENT TAX-FREE
- -----------------------------------------------------------------------
1999 1998 1999 1998 1999 1998
- -----------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
$ 232,624 235,535 33,082 35,113 23,616 27,214
- -----------------------------------------------------------------------
(232,624) (235,535) (33,082) (35,113) (23,616) (27,214)
- -----------------------------------------------------------------------
8,713,747 7,670,002 660,407 646,450 908,119 851,664
- -----------------------------------------------------------------------
223,035 227,005 31,986 33,991 22,976 26,435
- -----------------------------------------------------------------------
8,936,782 7,897,007 692,393 680,441 931,095 878,099
- -----------------------------------------------------------------------
(8,365,878) (7,720,315) (667,480) (664,709) (950,930) (833,520)
- -----------------------------------------------------------------------
570,904 176,692 24,913 15,732 (19,835) 44,579
4,538,627 4,361,935 686,871 671,139 815,894 771,315
- -----------------------------------------------------------------------
$5,109,531 4,538,627 711,784 686,871 796,059 815,894
</TABLE>
<PAGE> 38
36
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
1. DESCRIPTION OF THE FUNDS
- --------------------------------------------------------------------------------
Zurich Money Funds (the "Trust") is registered under the Investment Company Act
of 1940, as amended (the "1940 Act"), as an open-end diversified management
investment company organized as a Massachusetts business trust. The Trust
currently offers three investment funds ("Funds"). Zurich Money Market Fund
invests primarily in short-term high quality obligations of major banks and
corporations. Zurich Government Money Fund invests exclusively in obligations
issued or guaranteed by the U.S. Government or its agencies and repurchase
agreements thereon. Zurich Tax-Free Money Fund invests in short-term high
quality municipal securities.
The Fund's financial statements are prepared in accordance with generally
accepted accounting principles which require the use of management estimates.
The policies described below are followed consistently by the Fund in the
preparation of its financial statements.
- --------------------------------------------------------------------------------
2. SIGNIFICANT ACCOUNTING POLICIES
- --------------------------------------------------------------------------------
SECURITY VALUATION. The Funds value all portfolio securities utilizing the
amortized cost method permitted in accordance with Rule 2a-7 under the 1940 Act
and pursuant to which the Funds must adhere to certain conditions. Under this
method, which does not take into account unrealized gains or losses on
securities, an instrument is initially valued at its cost and thereafter assumes
a constant accretion/amortization to maturity of any discount/premium.
REPURCHASE AGREEMENTS. The Funds may enter into repurchase agreements with
certain banks and broker/dealers whereby the Funds, through its custodian or
sub-custodian bank, receives delivery of the underlying securities, the amount
of which at the time of purchase and each subsequent business day is required to
be maintained at such a level that the market value is equal to at least the
principal amount of the repurchase price plus accrued interest.
FEDERAL INCOME TAXES. Each Fund's policy is to comply with the requirements of
the Internal Revenue Code, as amended, which are applicable to regulated
investment companies and to distribute all of its taxable and tax-exempt income
to its shareholders. Accordingly, the Funds paid no federal income taxes and no
federal income tax provision was required.
<PAGE> 39
37
DISTRIBUTION OF INCOME AND GAINS. All of the net investment income of the Funds
are declared as a daily dividend and are distributed to shareholders monthly.
Net investment income includes all realized gains (losses) on portfolio
securities.
INVESTMENT TRANSACTIONS AND INVESTMENT INCOME. Investment transactions are
accounted for on the trade date. Interest income is recorded on the accrual
basis. All discounts and premiums are accreted/amortized for both tax and
financial reporting purposes.
EXPENSES. Expenses arising in connection with a specific Fund are allocated to
that Fund. Other Trust expenses are allocated between the Funds in proportion to
their relative net assets.
- --------------------------------------------------------------------------------
3. TRANSACTIONS WITH AFFILIATES
- --------------------------------------------------------------------------------
MANAGEMENT AGREEMENT. The Funds have a management agreement with Scudder Kemper
Investments, Inc. (Scudder Kemper) and pay a monthly investment management fee
of 1/12 of the annual rate of .50% of the first $215 million of combined average
daily net assets declining to .25% of combined average daily net assets in
excess of $800 million. During the year ended July 31, 1999, the Funds incurred
management fees of $17,246,000.
SHAREHOLDER SERVICES AGREEMENT. Pursuant to a services agreement with the Funds'
transfer agent, Kemper Service Company (KSvC) is the shareholder service agent
of the Trust. Under the agreement, KSvC received shareholder services fees of
$6,351,000 for the year ended July 31, 1999.
OFFICERS AND TRUSTEES. Certain officers or trustees of the Trust are also
officers or directors of Scudder Kemper. During the year ended July 31, 1999,
the Trust made no payments to its officers and incurred trustees' fees of
$69,000 to independent trustees.
<PAGE> 40
38
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
ZURICH MONEY MARKET FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------
PER SHARE OPERATING PERFORMANCE
YEAR ENDED JULY 31,
----------------------------------------------------------
1999 1998 1997 1996 1995
- ----------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value,
beginning of year $1.00 1.00 1.00 1.00 1.00
- ----------------------------------------------------------------------------------
Net investment income .05 .05 .05 .05 .05
- ----------------------------------------------------------------------------------
Less dividends declared .05 .05 .05 .05 .05
- ----------------------------------------------------------------------------------
Net asset value, end
of year $1.00 1.00 1.00 1.00 1.00
- ----------------------------------------------------------------------------------
TOTAL RETURN 4.89% 5.38 5.27 5.34 5.34
- ----------------------------------------------------------------------------------
RATIOS TO AVERAGE NET ASSETS
- ----------------------------------------------------------------------------------
Expenses .46% .48 .45 .50 .52
- ----------------------------------------------------------------------------------
Net investment income 4.78% 5.24 5.14 5.20 5.19
- ----------------------------------------------------------------------------------
SUPPLEMENTAL DATA
- ----------------------------------------------------------------------------------
Net assets at end of
year (in thousands) $5,109,531 4,538,627 4,361,935 4,225,775 4,025,098
</TABLE>
Note: Zurich Money Market Fund's total return for the year ended July 31, 1995
includes the effect of a capital contribution from the investment manager.
Without the capital contribution, the total return would have been 4.62%.
<PAGE> 41
39
- --------------------------------------------------------------------------------
ZURICH GOVERNMENT MONEY FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
PER SHARE OPERATING PERFORMANCE
- --------------------------------------------------------------------------------
YEAR ENDED JULY 31,
------------------------------------------------
1999 1998 1997 1996 1995
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value,
beginning of year $1.00 1.00 1.00 1.00 1.00
- --------------------------------------------------------------------------------
Net investment income .05 .05 .05 .05 .05
- --------------------------------------------------------------------------------
Less dividends declared .05 .05 .05 .05 .05
- --------------------------------------------------------------------------------
Net asset value, end of
year $1.00 1.00 1.00 1.00 1.00
- --------------------------------------------------------------------------------
TOTAL RETURN 4.78% 5.33 5.26 5.34 5.36
- --------------------------------------------------------------------------------
RATIOS TO AVERAGE NET ASSETS
- --------------------------------------------------------------------------------
Expenses .43% .43 .44 .46 .46
- --------------------------------------------------------------------------------
Net investment income 4.67% 5.20 5.13 5.20 5.21
- --------------------------------------------------------------------------------
SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------
Net assets at end of
year (in thousands) $711,784 686,871 671,139 672,041 603,601
</TABLE>
<PAGE> 42
40
FINANCIAL HIGHLIGHTS, CONTINUED
- --------------------------------------------------------------------------------
ZURICH TAX-FREE MONEY FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PER SHARE OPERATING PERFORMANCE
YEAR ENDED JULY 31,
------------------------------------------------
1999 1998 1997 1996 1995
- -----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value,
beginning of year $1.00 1.00 1.00 1.00 1.00
- ----------------------------------------------------------------------------
Net investment income .03 .03 .03 .03 .03
- ----------------------------------------------------------------------------
Less dividends declared .03 .03 .03 .03 .03
- ----------------------------------------------------------------------------
Net asset value, end of
year $1.00 1.00 1.00 1.00 1.00
- ----------------------------------------------------------------------------
TOTAL RETURN 2.97% 3.46 3.39 3.44 3.53
- ----------------------------------------------------------------------------
RATIOS TO AVERAGE NET ASSETS
- ----------------------------------------------------------------------------
Expenses .36% .36 .37 .39 .40
- ----------------------------------------------------------------------------
Net investment income 2.93% 3.39 3.33 3.38 3.46
- ----------------------------------------------------------------------------
SUPPLEMENTAL DATA
- ----------------------------------------------------------------------------
Net assets at end of
year (in thousands) $796,059 815,894 771,315 729,018 760,143
</TABLE>
<PAGE> 43
41
- --------------------------------------------------------------------------------
TAX INFORMATION
- --------------------------------------------------------------------------------
All of the dividends from Zurich Money Market Fund and Zurich Government Money
Fund are taxable as ordinary income. These dividends, whether received in cash
or reinvested in shares, must be included in your federal income tax return and
must be reported by the Fund to the Internal Revenue Service in accordance with
U.S. Treasury Department Regulations.
Of the dividends paid from Zurich Tax-Free Money Fund for the taxable year ended
July 31, 1999, 100% are designated as exempt interest dividends for federal
income tax purposes. However, a portion of the dividends may be includable in
the alternative minimum tax calculation.
Please consult a tax adviser if you have questions about federal or state income
tax laws, or on how to prepare your tax returns. If you have specific questions
about your Zurich account, please call 1-888-ZURICH-1 (987-4241).
<PAGE> 44
TRUSTEES & OFFICERS
TRUSTEES OFFICERS
JOHN W. BALLANTINE MARK S. CASADY
Trustee President
LEWIS A. BURNHAM PHILIP J. COLLORA
Trustee Vice President and
Secretary
DONALD L. DUNAWAY
Trustee ANN M. MCCREARY
Vice President
ROBERT B. HOFFMAN
Trustee ROBERT C. PECK, JR.
Vice President
DONALD R. JONES
Trustee KATHRYN L. QUIRK
Vice President
THOMAS W. LITTAUER
Trustee and FRANK J. RACHWALSKI, JR.
Vice President Vice President
SHIRLEY D. PETERSON LINDA J. WONDRACK
Trustee Vice President
CORNELIA SMALL JOHN R. HEBBLE
Trustee Treasurer
WILLIAM P. SOMMERS MAUREEN E. KANE
Trustee Assistant Secretary
CAROLINE PEARSON
Assistant Secretary
BRENDA LYONS
Assistant Treasurer
- -------------------------------------------------------------------------------
LEGAL COUNSEL VEDDER, PRICE, KAUFMAN & KAMMHOLZ
222 North LaSalle Street
Chicago, IL 60601
- -------------------------------------------------------------------------------
SHAREHOLDER SERVICE AGENT KEMPER SERVICE COMPANY
P.O. Box 419066
Kansas City, MO 64141-6066
- -------------------------------------------------------------------------------
CUSTODIAN STATE STREET BANK AND TRUST COMPANY
225 Franklin Street
Boston, MA 02110
- -------------------------------------------------------------------------------
TRANSFER AGENT INVESTORS FIDUCIARY TRUST COMPANY
801 Pennsylvania
Kansas City, MO 64105
- -------------------------------------------------------------------------------
INDEPENDENT ERNST & YOUNG LLP
AUDITORS 233 South Wacker Drive
Chicago, IL 60606
This report must be preceded or
accompanied by a Zurich Money Funds prospectus.
[RECYCLE LOGO]
Printed in the U.S.A. on recycled paper. [ZURICH LOGO]
ZMF-2 9/30/99 1090220 Telephone: 1-888-ZURICH-1(987-4241)
