(ICON)
Prudential
MoneyMart
Assets, Inc.
ANNUAL
REPORT
Dec. 31, 1998
<PAGE>
Prudential MoneyMart Assets, Inc.
Performance At A Glance.
Money market yields hovered in a relatively narrow range for
much of 1998, then
declined sharply as the Federal Reserve eased monetary
policy three times to
protect the U.S. economic expansion. Prudential MoneyMart
Assets provided solid
yields and a stable $1 per share net asset value as we
locked in attractive
yields available during the first half of the year and the
final month. On
December 31, 1998, our seven-day current yield for Class A
shares was 4.64%,
slightly above the 4.53% for the average money market fund
tracked by IBC
Financial Data.
Fund Facts As of 12/31/98
<TABLE>
<CAPTION>
7-Day Net Asset Weighted
Avg. Net Assets
Current Yld. Value (NAV) Mat.
(WAM) (Millions)
<S> <C> <C> <C>
<C>
Class A 4.64% $1 71 Days
$6,152
Class Z* 4.76 $1 71 Days
$ 212
IBC Financial Data
Money Fund Avg.
(General Purpose**) 4.53 $1 61 Days
N/A
</TABLE>
Note: Yields will fluctuate from time to time and past
performance is not
indicative of future results. An investment in the Fund is
not insured or
guaranteed by the Federal Deposit Insurance Corporation or
any other government
agency. Although the Fund seeks to preserve the value of
your investment at
$1.00 per share, it is possible to lose money by investing
in the Fund.
*Class Z shares are not subject to a distribution fee.
**International Business Communications (IBC) Financial Data
reports a
seven-day current yield, NAV, and WAM on Tuesdays. This is
the data of all
funds in the IBC Money Fund Average (General Purpose -
Taxable 1st & 2nd Tier)
category as of December 29, 1998, the closest date to the
end of our reporting
period.
How Investments Compared.
(As of 12/31/98)
(GRAPH)
Source: Lipper, Inc. Financial markets change, so a mutual
fund's past
performance should never be used to predict future results.
The risks to each
of the investments listed above are different -- we provide
12-month total
return averages for several Lipper mutual fund categories to
show you that
reaching for higher yields means tolerating more risk. The
greater the risk,
the larger the potential reward or loss. In addition, we've
included historical
20-year average annual returns. These returns assume the
reinvestment of
dividends.
U.S. Growth Funds will fluctuate a great deal. Investors
have received higher
historical total returns from stocks than from most other
investments. Smaller
capitalization stocks offer greater potential for long-term
growth but may be
more volatile than larger capitalization stocks.
General Bond Funds provide more income than stock funds,
which can help smooth
out their total returns year by year. But their prices still
fluctuate
(sometimes significantly) and their returns have been
historically lower than
those of stock funds. Unlike bond funds, bonds, if held to
maturity, generally
offer a fixed rate of return and fixed principal value.
General Municipal Debt Funds invest in bonds issued by state
governments, state
agencies and/or municipalities. This investment provides
income that is usually
exempt from federal and state income taxes.
U.S. Taxable Money Funds attempt to preserve a constant
share value; they don't
fluctuate much in price but, historically, their returns
have been generally
among the lowest of the major investment categories.
Money Fund Yields Trended Lower.
(GRAPH)
<PAGE>
Joseph M. Tully, Fund Manager
(PHOTO)
Portfolio
Manager's Report
Prudential MoneyMart Assets seeks maximum current income
consistent with
stability of capital and the maintenance of liquidity. The
Fund is a
diversified portfolio of high-quality, U.S. dollar-
denominated money market
securities issued by the U.S. government and its agencies,
major corporations
and commercial banks of the United States and abroad.
Maturities can range from
one day to 13 months. We typically purchase only securities
rated in one of the
two highest categories by at least two major rating agencies
or, if not rated,
deemed to be of equivalent quality by our credit research
staff. There can be
no assurance that the Fund will achieve its financial
objective.
The Importance Of WAM.
Weighted average maturity (WAM) takes into account the
maturity level of each
security held by a fund. WAM is the measurement tool that
determines a fund's
sensitivity to changes in interest rates. A lengthened WAM
enables a fund's
yield to remain higher for a longer period of time when
interest rates decline.
Strategy Session.
- ------------------------------------------------------------
- -------------------
During the first half of 1998, our strategy involved taking
advantage of
attractive buying opportunities created by overdone swings
in investor
sentiment. For example, investors pushed money market yields
lower in January
and February. They expected a global financial crisis that
began in Asia during
1997 to hurt the U.S. economy and force a near-term cut in
the Federal funds
rate (the rate banks charge each other for overnight loans).
Reducing this key
rate encourages economic activity by lowering borrowing
costs. To the extent
possible, we avoided investing during this period of lower
yields.
However, the continued strength of the U.S. economy, plus
some "balanced"
comments by Federal Reserve Chairman Alan Greenspan in late
February, abruptly
dispelled the notion that a Federal funds rate cut was
imminent. As a result,
investor sentiment changed and money market yields headed
higher. We then
locked in higher yields by purchasing one-year term
securities that
significantly lengthened the Fund's weighted average
maturity (WAM).
Anxiety prevailed in fixed-income markets after the
financial crisis spread
from Asia to Russia and Latin America in August. Money
market yields continued
to fall in September and October as demand soared for "safe
haven" securities,
such as U.S. Treasury bills, and investors sold assets that
carried more risk.
This trend left Treasuries overvalued and impaired market
liquidity. Because of
these highly volatile market conditions, we avoided
purchasing longer-term
money market securities that would have substantially
lengthened the Fund's
WAM.
The Federal Reserve cut the Federal funds rate by a quarter
percentage point on
September 29, October 15, and November 17, leaving the rate
at 4.75% by the end
of the year. These moves helped calm the debt markets and
restore confidence in
the U.S. economy.
<PAGE>
What Went Well.
- -------------------------------------------------
"Fire Sale" Prices.
In late June, a number of technical market factors converged
to create an
opportunity to buy securities at what we considered to be
"fire sale" prices.
We used this occasion to reposition the Fund's WAM to be
more in line with that
of its competition.
Year-End Bargains.
Although the three cuts in the Federal funds rate had pushed
money market
yields sharply lower, companies anxious to borrow money over
year end still
paid handsomely to do so in early December. We took
advantage of this brief
jump in yields by purchasing variable-rate securities as
well as securities
maturing in two months, three months, and one year. All
carried yields that
were attractive relative to the Federal funds rate.
And Not So Well.
- -------------------------------------------------
Too Short.
Growing demand for Treasuries and fear of a recession in the
United States
began to drive interest rates dramatically lower in August.
We initially
thought this decline was overdone in light of the U.S.
economy's relative
strength and the Federal Reserve's bias toward raising short-
term rates earlier
in the year. Therefore, we avoided purchasing longer-term
money market
securities, which allowed the Fund's WAM to shorten
substantially compared with
that of its competition. This hurt Fund returns.
When the debt markets settled down, we once again
repositioned the Fund's WAM
more in line with its competition.
Looking Ahead.
- -------------------------------------------------
The U.S. economy remains surprisingly resilient. Therefore,
we do not expect
another Federal funds rate reduction in the near future. For
the longer term,
however, the absence of inflationary pressures in the United
States and the
spread of global financial turmoil to Latin America suggest
the next major
change in monetary policy will likely be a short-term rate
cut. With this in
mind, we plan to keep the Fund's WAM longer than that of its
competition and
to buy term securities "on weakness" or when yields
temporarily rise.
Weighted Average Maturity Compared To The Average Fund.
(GRAPH)
1
<PAGE>
President's Letter
February 16, 1999
- ------------------------------------------------------------
- -------------------
(PHOTO)
Dear Shareholder:
Many major equity market indexes ended 1998 on the upswing -
- - posting an
unprecedented fourth consecutive year of double-digit
returns -- as many stocks
rebounded off their early October lows. Bond investors were
also cheered by
healthy returns on U.S. Treasuries and investment-grade
corporate debt, as well
as certain Western European bonds.
Unfortunately, the equity market's advance was neither broad
nor deep. It was
limited primarily to stocks of larger companies with
established records of
growth. Investors ignored the stocks of both undervalued
companies and smaller
companies in a "flight to quality" stemming from financial
turmoil in Asia and
fears of a recession in the United States. Accordingly,
growth-style investors
in large-company stocks outperformed value-style investors
by the widest
margins in nearly 24 years -- and not since the Great
Depression have
large-company stocks so outperformed stocks of small
companies.
The rally in bonds was not universal either. While
government bonds --
especially Treasuries -- enjoyed strong appeal, investors
were cool toward
lower-rated issues. High yield bonds, therefore, saw yields
rise while prices
fell.
What We Can Learn From '98
The volatility of 1998 underscores points all investors
should keep in mind:
Financial markets will rise and fall, sometimes
dramatically. Because asset
classes seldom move in lockstep, owning a mix of value- and
growth-oriented
mutual funds in addition to bond and money market funds can
help lessen the
effects of market volatility.
Generally speaking, long-term success in investment
management comes from
remaining true to an investment discipline -- even when it
is out of favor.
Investors who maintain a long-term perspective and don't
sell during market
lows are more likely to regain lost ground, and while past
events cannot
foretell future performance, stocks and bonds have produced
attractive returns
ahead of inflation over time.
Thank you for your continued confidence in Prudential mutual
funds.
Sincerely,
Brian M. Storms
President
2
<PAGE>
Portfolio of Investments as
of December 31, 1998 PRUDENTIAL MONEYMART
ASSETS, INC.
- ------------------------------------------------------------
<TABLE>
<CAPTION>
Principal
Amount
(000) Description Value (Note 1)
<C> <S> <C>
--------------------------------------------------------
- ----
Bank Notes--7.3%
FCC National Bank
$ 36,000 5.19%, 1/15/99 $
36,000,000
34,000 4.90%, 12/16/99
33,984,307
65,000 4.885%, 12/16/99
64,960,998
First Union National Bank
86,000 5.59%, 2/19/99
86,000,000
Key Bank N.A.
33,000 4.67%, 1/29/99
32,998,655
Nationsbank N.A.
121,000 5.05%, 2/16/99
121,000,000
92,000 4.90%, 12/14/99
91,957,780
----------
- ----
466,901,740
- ------------------------------------------------------------
Certificates of Deposit - Domestic--4.9%
Bayerishe Hypotheken und Vereinsbank AG
11,000 5.675%, 3/3/99
10,999,207
Canadian Imperial Bank of Commerce
94,000 5.55%, 2/10/99
93,995,058
Chase Manhattan Bank (USA)
50,000 5.25%, 2/8/99
50,000,000
National Bank of Canada
75,000 5.23%, 3/2/99
75,000,000
Rabobank Nederland
80,000 5.50%, 2/9/99
79,993,438
----------
- ----
309,987,703
- ------------------------------------------------------------
Certificates of Deposit - Eurodollar--3.7%
Abbey National Treasury Services
PLC
65,000 5.25%, 1/20/99
65,000,000
100,000 5.75%, 3/5/99
100,000,000
Barclays Bank
74,000 5.37%, 2/24/99
74,016,113
----------
- ----
239,016,113
- ------------------------------------------------------------
Certificates of Deposit - Yankee--10.8%
ABN-Amro Bank
69,000 4.88%, 12/22/99
68,954,647
95,000 4.92%, 12/23/99
94,955,281
Barclays Bank PLC
$ 50,000 5.56%, 2/25/99 $
49,995,664
Bayerische Landesbank Girozentrale
150,000 4.885%, 12/20/99
149,908,989
Deutsche Bank
150,000 5.54%, 2/24/99
149,989,353
25,000 5.57%, 2/26/99
24,998,161
50,000 5.62%, 2/26/99
49,996,322
50,000 5.63%, 2/26/99
49,993,384
50,000 5.66%, 3/3/99
49,995,996
----------
- ----
688,787,797
- ------------------------------------------------------------
Commercial Paper--54.7%
Abbey National North America Corp.
14,000 5.229%, 2/9/99
13,920,693
Aetna Services Inc.
4,000 5.60%, 1/12/99
3,993,156
13,000 5.50%, 1/15/99
12,972,194
American General Finance Corp.
31,812 5.20%, 2/9/99
31,632,792
11,000 5.22%, 2/17/99
10,925,035
American Honda Finance Corp.
15,000 5.25%, 2/10/99
14,912,500
Aon Corp.
10,000 5.38%, 2/26/99
9,916,311
Associates Corp. of North America
42,000 5.22%, 2/16/99
41,719,860
100,000 5.11%, 3/9/99
99,048,972
Associates First Capital Corp.
75,000 5.20%, 2/9/99
74,577,500
9,000 5.16%, 2/16/99
8,940,660
50,000 5.29%, 2/17/99
49,654,681
Bank of Montreal
120,000 5.122%, 2/18/99
119,180,480
BBL North America Funding Corp.
42,000 5.185%, 1/22/99
41,872,967
80,000 5.09%, 1/28/99
79,694,600
9,090 5.33%, 1/29/99
9,052,317
Chase Manhattan Corp.
38,708 5.22%, 2/22/99
38,416,142
</TABLE>
- ------------------------------------------------------------
- --------------------
See Notes to Financial Statements. 3
<PAGE>
Portfolio of Investments as
of December 31, 1998 PRUDENTIAL MONEYMART
ASSETS, INC.
- ------------------------------------------------------------
<TABLE>
<CAPTION>
Principal
Amount
(000) Description Value (Note 1)
<C> <S> <C>
-----------------------------------------------------------
- -
Commercial Paper (cont'd.)
Chrysler Financial Co., L.L.C.
$ 50,000 5.25%, 2/22/99 $
49,620,833
CIT Group Holdings, Inc.
75,000 5.10%, 2/19/99
74,479,375
Coca-Cola Enterprises, Inc.
25,000 5.17%, 3/3/99
24,780,993
Cregem North America, Inc.
70,000 5.12%, 3/19/99
69,233,422
Daimler Benz North America
19,726 5.22%, 2/23/99
19,574,406
12,106 5.25%, 2/23/99
12,012,431
33,000 5.00%, 3/24/99
32,624,167
Duke Capital Corp.
3,536 5.20%, 1/4/99
3,534,468
Enterprise Funding Corp.
8,843 5.40%, 1/20/99
8,817,797
17,000 5.40%, 1/22/99
16,946,450
25,084 5.30%, 1/29/99
24,980,598
First Chicago Financial Corp.
35,000 5.12%, 2/11/99
34,795,911
Ford Motor Credit Corp.
21,000 5.398%, 1/14/99
21,000,000
123,026 5.10%, 3/8/99
121,875,707
General Electric Capital Corp.
67,000 5.16%, 1/29/99
66,731,107
125,936 5.11%, 3/8/99
124,756,190
34,259 5.11%, 3/9/99
33,933,187
48,000 4.88%, 6/11/99
46,952,427
General Motors Acceptance Corp.
140,000 5.19%, 1/26/99
139,495,417
179,700 5.06%, 1/29/99
178,992,781
Johnson Controls, Inc.
18,742 5.42%, 1/19/99
18,691,209
Merrill Lynch & Co., Inc.
148,210 5.14%, 3/19/99
146,580,596
Monte Rosa Capital Corp.
10,000 5.40%, 1/28/99
9,959,500
19,873 5.40%, 1/29/99
19,789,533
45,000 5.40%, 2/12/99
44,716,500
$ 49,000 5.30%, 2/19/99 $
48,646,519
16,098 5.43%, 2/19/99
15,979,022
81,000 5.46%, 2/19/99
80,398,035
29,000 5.28%, 2/22/99
28,778,827
NationsBank Corp.
41,000 5.50%, 2/12/99
40,736,917
Nationwide Building Society
23,000 5.06%, 3/1/99
22,809,266
16,000 5.11%, 3/9/99
15,847,835
Nordbanken North America, Inc.
25,000 5.10%, 2/17/99
24,833,542
Norwest Financial, Inc.
34,000 5.23%, 3/4/99
33,693,754
Old Line Funding Corp.
60,900 5.40%, 1/14/99
60,781,245
24,589 5.40%, 1/15/99
24,537,363
9,000 5.37%, 1/29/99
8,962,410
PNC Funding Corp.
10,000 5.20%, 2/22/99
9,924,889
Preferred Receivables Funding
Corp.
11,000 5.40%, 2/16/99
10,924,100
SAFECO Corp.
16,825 4.90%, 3/29/99
16,625,764
10,589 5.08%, 4/19/99
10,427,624
5,000 5.08%, 4/28/99
4,917,450
Salomon Smith Barney Holdings,
Inc.
80,000 5.23%, 1/15/99
79,837,289
Sears Roebuck Acceptance Corp.
32,000 5.25%, 2/24/99
31,748,000
Toronto Dominion Holdings (USA)
45,362 4.90%, 6/4/99
44,411,162
200,000 4.90%, 6/8/99
195,698,889
UBS Finance (Delaware), Inc.
204,630 5.219%, 1/15/99
204,214,681
116,522 5.073%, 1/28/99
116,078,663
Unifunding, Inc.
28,000 5.23%, 2/5/99
27,857,628
150,000 5.10%, 2/26/99
148,810,000
Windmill Funding Corp.
32,000 5.60%, 1/15/99
31,930,311
</TABLE>
- ------------------------------------------------------------
- --------------------
See Notes to Financial Statements. 4
<PAGE>
Portfolio of Investments as
of December 31, 1998 PRUDENTIAL MONEYMART
ASSETS, INC.
- ------------------------------------------------------------
<TABLE>
<CAPTION>
Principal
Amount
(000) Description Value (Note 1)
<C> <S> <C>
--------------------------------------------------------
- ---
Commercial Paper (cont'd.)
$ 21,538 5.42%, 1/22/99 $
21,469,904
75,000 5.40%, 1/28/99
74,696,250
20,800 5.10%, 2/1/99
20,708,653
Wood Street Funding Corp.
18,000 5.40%, 2/18/99
17,870,400
----------
- ----
3,479,462,257
- ------------------------------------------------------------
Loan Participations--1.0%
Baker Hughes Inc.
61,000 5.70%, 1/29/99
61,000,000
- ------------------------------------------------------------
Other Corporate Obligations--15.2%
Abbey National Treasury Services
PLC
50,000 5.72%, 6/11/99
49,983,106
Bishops Gate Residental
Mortgage(b)
41,000 5.747%, 1/20/99
41,000,000
Goldman Sachs Group L.P. Medium
Term Note(b)
370,700 5.875%, 1/19/99
370,700,000
Liquid Asset Backed Securities
Trust(b)
46,443 5.624%, 1/26/99
46,442,768
Restructured Asset Certificates(b)
122,000 5.6101%, 1/4/99
122,000,000
117,000 5.675%, 2/10/99
117,000,000
21,000 5.629%, 1/29/99
21,000,000
Strategic Money Market Trust(b)
19,000 5.592%, 1/5/99
19,000,000
179,000 5.320%, 3/16/99
179,000,000
----------
- ----
966,125,874
- ------------------------------------------------------------
Total Investments--97.6%
(amortized cost $6,211,281,484(a))
6,211,281,484
Other assets in excess of
liabilities--2.4%
153,041,876
----------
- ----
Net Assets--100%
$6,364,323,360
----------
- ----
----------
- ----
</TABLE>
- ---------------
(a) Federal income tax basis for portfolio securities is
the
same as for financial reporting purposes.
(b) The maturity date presented for these instruments is
the
later of the next date on which the security can be
redeemed at par or the next date on which the rate of
interest is adjusted.
The industry classification of portfolio holdings and other
assets in excess of
liabilities shown as a percentage of net assets as of
December 31, 1998 was as
follows:
Commercial Banks.....................................
53.9%
Security Brokers & Dealers........................... 10.2
Motor Vehicle........................................ 9.0
Asset Backed Securities.............................. 7.1
Short-Term Business Credit........................... 5.4
Bank Holding Companies-Domestic...................... 3.4
Personal Credit Institutions......................... 3.2
Health............................................... 2.5
Oil Construction..................................... 1.0
Mortgage Banks....................................... .6
Fire & Marine Casualty Insurance..................... .5
Beverages............................................ .4
Regulating Controls.................................. .3
Electric Services.................................... .1
-----
97.6
Other assets in excess of liabilities................ 2.4
-----
100.0%
-----
-----
- ------------------------------------------------------------
- --------------------
See Notes to Financial Statements. 5
<PAGE>
Statement of Assets and Liabilities PRUDENTIAL
MONEYMART ASSETS, INC.
- ------------------------------------------------------------
- --------------------
<TABLE>
<CAPTION>
Assets
December 31, 1998
- -----------------
<S>
<C>
Investments, at amortized cost which approximates market
value.......................................... $
6,211,281,484
Cash........................................................
............................................
391,643
Receivable for Fund shares
sold........................................................
................. 212,538,719
Interest
receivable..................................................
................................... 55,462,248
Deferred expenses and other
assets......................................................
................ 163,194
- -----------------
Total
assets......................................................
................................... 6,479,837,288
- -----------------
Liabilities
Payable for Fund shares
reacquired..................................................
.................... 107,881,745
Accrued
expenses....................................................
.................................... 4,492,225
Management fee
payable.....................................................
............................. 1,652,875
Dividends
payable.....................................................
.................................. 1,149,310
Distribution fee
payable.....................................................
........................... 337,773
- -----------------
Total
liabilities.................................................
................................... 115,513,928
- -----------------
Net
Assets......................................................
........................................ $
6,364,323,360
- -----------------
- -----------------
Net assets were comprised of:
Common Stock, at par ($.001 par value; 15 billion shares
authorized for issuance).................... $
6,364,323
Paid-in capital in excess of
par.........................................................
............ 6,357,959,037
- -----------------
Net assets, December 31,
1998........................................................
................... $ 6,364,323,360
- -----------------
- -----------------
Class A:
Net asset value, offering price and redemption price per
share
($6,152,043,681 / 6,152,043,681 shares of common stock
issued and outstanding)....................
$1.00
- -----------------
- -----------------
Class Z:
Net asset value, offering price and redemption price per
share
($212,279,679 / 212,279,679 shares of common stock
issued and outstanding)........................
$1.00
- -----------------
- -----------------
</TABLE>
- ------------------------------------------------------------
- --------------------
See Notes to Financial Statements. 6
<PAGE>
PRUDENTIAL MONEYMART ASSETS, INC.
Statement of Operations
- ------------------------------------------------------------
<TABLE>
<CAPTION>
Year Ended
Net Investment Income December 31,
1998
<S> <C>
Income
Interest.............................. $ 395,288,579
----------------
- -
Expenses
Management fee........................ 21,115,140
Distribution fee--Class A............. 8,512,971
Transfer agent's fees and expenses.... 15,824,400
Reports to shareholders............... 1,950,000
Registration fees..................... 536,000
Custodian's fees and expenses......... 215,000
Insurance............................. 99,000
Director's fees and expenses.......... 56,000
Audit fees and expenses............... 35,000
Legal fees and expenses............... 29,000
Miscellaneous......................... 111,062
----------------
- -
Total expenses..................... 48,483,573
----------------
- -
Net investment income.................... 346,805,006
----------------
- -
Net Realized Gain on Investments
Net realized gain on investment
transactions.......................... 24,512
----------------
- -
Net Increase in Net Assets
Resulting from Operations................ $ 346,829,518
----------------
- -
----------------
- -
</TABLE>
PRUDENTIAL MONEYMART ASSETS, INC.
Statement of Changes in Net Assets
- ------------------------------------------------------------
<TABLE>
<CAPTION>
Increase (Decrease) Year Ended December 31,
in Net Assets 1998 1997
<S> <C> <C>
Operations
Net investment income... $ 346,805,006 $
361,956,251
Net realized gain on
investment
transactions......... 24,512
10,050
---------------- -----------
- -----
Net increase in net
assets resulting from
operations........... 346,829,518
361,966,301
---------------- -----------
- -----
Dividends and distributions
to shareholders (Note 1)
Class A.............. (336,977,571)
(353,829,321)
Class Z.............. (9,851,947)
(8,136,980)
---------------- -----------
- -----
(346,829,518)
(361,966,301)
---------------- -----------
- -----
Fund share transactions
(Note 4)
(At $1.00 per share)
Proceeds from shares
sold................. 30,787,213,555
32,812,146,168
Net asset value of
shares issued to
shareholders in
reinvestment of
dividends and
distributions........ 329,144,169
346,107,446
Cost of shares
reacquired........... (31,773,032,919)
(33,601,689,773)
---------------- -----------
- -----
Net decrease in net
assets from Fund
share transactions... (656,675,195)
(443,436,159)
---------------- -----------
- -----
Total decrease............. (656,675,195)
(443,436,159)
Net Assets
Beginning of year.......... 7,020,998,555
7,464,434,714
---------------- -----------
- -----
End of year................ $ 6,364,323,360 $
7,020,998,555
---------------- -----------
- -----
---------------- -----------
- -----
</TABLE>
- ------------------------------------------------------------
- --------------------
See Notes to Financial Statements. 7
<PAGE>
Notes to Financial Statements PRUDENTIAL
MONEYMART ASSETS, INC.
- ------------------------------------------------------------
- --------------------
Prudential MoneyMart Assets, Inc. (the 'Fund') is registered
under the
Investment Company Act of 1940 as a diversified, open-end
management investment
company. The Fund invests primarily in a portfolio of money
market instruments
maturing in thirteen months or less whose ratings are within
the two highest
rating categories by a nationally recognized statistical
rating organization or,
if not rated, are of comparable quality. The ability of the
issuers of the
securities held by the Fund to meet their obligations may be
affected by
economic developments in a specific industry or region.
- ------------------------------------------------------------
Note 1. Accounting Policies
The following is a summary of significant generally accepted
accounting policies
followed by the Fund in the preparation of its financial
statements.
Securities Valuations: Portfolio securities are valued at
amortized cost, which
approximates market value. The amortized cost method
involves valuing a security
at its cost on the date of purchase and thereafter assuming
a constant
amortization to maturity of any discount or premium.
Repurchase Agreements: In connection with transactions in
repurchase agreements
with U.S. financial institutions, it is the Fund's policy
that its custodian or
designated subcustodians, as the case may be under triparty
repurchase
agreements, take possession of the underlying collateral
securities, the value
of which exceeds the principal amount of the repurchase
transaction including
accrued interest. If the seller defaults and the value of
the collateral
declines or if bankruptcy proceedings are commenced with
respect to the seller
of the security, realization of the collateral by the Fund
may be delayed or
limited.
Securities Transactions and Net Investment Income: Security
transactions are
recorded on the trade date. Realized gains and losses on
sales of investments
are calculated on the identified cost basis. Interest income
is recorded on the
accrual basis. Expenses are recorded on the accrual basis
which may require the
use of certain estimates by management. Net investment
income of the Fund
consists of interest accrued and discount earned less
estimated expenses
applicable to the dividend period. Net investment income
(other than
distribution fees), and realized gains or losses, if any,
are allocated daily to
each class of shares based upon the relative proportion of
net assets of each
class at the beginning of the day.
Federal Income Taxes: It is the Fund's policy to continue to
meet the
requirements of the Internal Revenue Code applicable to
regulated investment
companies and to distribute all of its taxable net
investment income to its
shareholders. Therefore, no federal income tax provision is
required.
The cost of portfolio securities for federal income tax
purposes is
substantially the same as for financial reporting purposes.
Dividends and Distributions: All of the Fund's net
investment income and net
realized gains or losses, if any, are declared as dividends
daily to the
shareholders of record at the time of such declaration.
Payment of dividends is
made monthly.
- ------------------------------------------------------------
Note 2. Agreements
The Fund has a management agreement with Prudential
Investments Fund Management
LLC ('PIFM'). Pursuant to this agreement, PIFM has
responsibility for all
investment advisory services and supervises the subadviser's
performance of such
services. PIFM has entered into a subadvisory agreement with
The Prudential
Investment Corporation ('PIC'); PIC furnishes investment
advisory services in
connection with the management of the Fund. PIFM pays for
the cost of the
subadviser's services, the compensation of officers of the
Fund, occupancy and
certain clerical and bookkeeping costs of the Fund. The Fund
bears all other
costs and expenses.
The management fee paid PIFM is computed daily and payable
monthly, at an annual
rate of .50 of 1% of the Fund's average daily net assets up
to $50 million and
.30 of 1% of the Fund's average daily net assets in excess
of $50 million.
The Fund had a distribution agreement with Prudential
Securities Incorporated
('PSI'), which acted as the distributor of the Class A and
Class Z shares of the
Fund through June 30, 1998. Effective July 1, 1998,
Prudential Investment
Management Services LLC ('PIMS') became the distributor of
the Fund and is
serving the Fund under the same terms and conditions as
under the agreement with
PSI. The Fund reimburses the distributors for distributing
and servicing the
Fund's Class A shares pursuant to the plan of distribution
at an annual rate of
.125 of 1% of the average daily net assets of the Class A
shares. The Class A
distribution fee is accrued daily and payable monthly. No
distribution or
service fees are paid to PIMS as distributor of the Class Z
shares of the Fund.
PSI, PIFM, PIMS and PIC are indirect, wholly owned
subsidiaries of The
Prudential Insurance Company of America.
- ------------------------------------------------------------
- --------------------
8
<PAGE>
Notes to Financial Statements PRUDENTIAL
MONEYMART ASSETS, INC.
- ------------------------------------------------------------
- --------------------
Note 3. Other Transactions with Affiliates
Prudential Mutual Fund Services LLC ('PMFS'), a wholly owned
subsidiary of PIFM,
serves as the Fund's transfer agent. During the year ended
December 31, 1998,
the Fund incurred fees of approximately $14,724,500 for the
services of PMFS. As
of December 31, 1998, approximately $1,118,600 of such fees
were due to PMFS.
Transfer agent fees and expenses in the Statement of
Operations include certain
out-of-pocket expenses paid to nonaffiliates.
- ------------------------------------------------------------
Note 4. Capital
The Fund offers Class A and Class Z shares. Class Z shares
are not subject to
any distribution and/or service fees and are offered
exclusively for sale to a
limited group of investors.
The Fund has authorized 15 billion shares of common stock,
$.001 par value per
share, divided into 13 billion authorized Class A shares and
2 billion
authorized Class Z shares. Of the 6,364,323,360 shares of
common stock issued
and outstanding at December 31, 1998, PIFM owned 590 and 270
shares of Class A
and Z, respectively.
Transactions in shares of common stock for the years ended
December 31, 1998 and
1997 were as follows:
<TABLE>
<CAPTION>
Year ended
December 31,
-------------------------------
- -----
1998 1997
---------------- -----------
- -----
<S> <C> <C>
Class A
- ---------------------------
Shares sold................ 30,236,936,348
32,421,538,819
Shares issued in
reinvestment of dividends
and distributions........ 319,520,177
338,151,149
Shares reacquired.......... (31,268,059,561)
(33,211,266,138)
---------------- -----------
- -----
Net decrease in shares
outstanding.............. (711,603,036)
(451,576,170)
---------------- -----------
- -----
---------------- -----------
- -----
<CAPTION>
Class Z
- ---------------------------
<S> <C> <C>
Shares sold................ 550,277,207
390,607,349
Shares issued in
reinvestment of dividends
and distributions........ 9,623,992
7,956,297
Shares reacquired.......... (504,973,358)
(390,423,635)
---------------- -----------
- -----
Net increase in shares
outstanding.............. 54,927,841
8,140,011
---------------- -----------
- -----
---------------- -----------
- -----
</TABLE>
- ------------------------------------------------------------
- --------------------
9
<PAGE>
Financial Highlights PRUDENTIAL
MONEYMART ASSETS, INC.
- ------------------------------------------------------------
- --------------------
<TABLE>
<CAPTION>
Class A Class Z
----------------------------
- ------------------------------------------ -------------
- --------
Year Ended
Year
Ended December 31, December
31,
----------------------------
- ------------------------------------------ -------------
- --------
1998 1997
1996 1995 1994 1998
1997
---------- ----------
- ---------- ---------- ---------- -------- --
- ------
<S> <C> <C>
<C> <C> <C> <C>
<C>
PER SHARE OPERATING
PERFORMANCE:
Net asset value, beginning
of period................ $ 1.000 $ 1.000
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $
1.000
Net investment income and
net realized gains........ .050 .050
.048 .054 .037 .051 .051
Dividends and distributions
to shareholders........... (.050) (.050)
(.048) (.054) (.037) (.051)
(.051)
---------- ----------
- ---------- ---------- ---------- -------- --
- ------
Net asset value, end of
period................... $ 1.000 $ 1.000
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $
1.000
---------- ----------
- ---------- ---------- ---------- -------- --
- ------
---------- ----------
- ---------- ---------- ---------- -------- --
- ------
TOTAL RETURN(a)............. 5.06% 5.09%
4.97% 5.51% 3.72% 5.19%
5.22%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(000).................... $6,152,044 $6,863,647
$7,315,223 $7,221,658 $6,544,880 $212,280
$157,352
Average net assets (000).... $6,810,377 $7,121,692
$7,326,023 $6,914,520 $7,071,381 $194,669
$159,508
Ratios to average net
assets:
Expenses, including
distribution fee...... .69% .70%
.71% .69% .71% .57% .58%
Expenses, excluding
distribution fee...... .57% .58%
.59% .56% .58% .57% .58%
Net investment income.... 4.95% 4.97%
4.83% 5.38% 3.65% 5.07%
5.10%
<CAPTION>
March 1,
1996(b)
Through
December 31,
1996
------------
<S> <C>
PER SHARE OPERATING
PERFORMANCE:
Net asset value, beginning
of period................ $ 1.000
Net investment income and
net realized gains........ .040
Dividends and distributions
to shareholders........... (.040)
------------
Net asset value, end of
period................... $ 1.000
------------
------------
TOTAL RETURN(a)............. 4.12%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(000).................... $149,212
Average net assets (000).... $121,135
Ratios to average net
assets:
Expenses, including
distribution fee...... .59%(c)
Expenses, excluding
distribution fee...... .59%(c)
Net investment income.... 4.86%(c)
</TABLE>
- ---------------
(a) Total return is calculated assuming a purchase of shares
on the first day
and a sale on the last day of each period reported and
includes reinvestment
of dividends and distributions. Total returns for less
than a full year are
not annualized.
(b) Commencement of offering of Class Z shares.
(c) Annualized.
- ------------------------------------------------------------
- --------------------
See Notes to Financial Statements. 10
<PAGE>
Report of Independent Accountants PRUDENTIAL
MONEYMART ASSETS, INC.
- ------------------------------------------------------------
- --------------------
To the Shareholders and Board of Directors of
Prudential MoneyMart Assets, Inc.
In our opinion, the accompanying statement of assets and
liabilities, including
the portfolio of investments, and the related statements of
operations and of
changes in net assets and the financial highlights present
fairly, in all
material respects, the financial position of Prudential
MoneyMart Assets, Inc.
(the 'Fund') at December 31, 1998, the results of its
operations for the year
then ended, and the changes in its net assets and the
financial highlights for
each of the two years in the period then ended, in
conformity with generally
accepted accounting principles. These financial statements
and financial
highlights (hereafter referred to as 'financial statements')
are the
responsibility of the Fund's management; our responsibility
is to express an
opinion on these financial statements based on our audits.
We conducted our
audits of these financial statements in accordance with
generally accepted
auditing standards which require that we plan and perform
the audit to obtain
reasonable assurance about whether the financial statements
are free of material
misstatement. An audit includes examining, on a test basis,
evidence supporting
the amounts and disclosures in the financial statements,
assessing the
accounting principles used and significant estimates made by
management, and
evaluating the overall financial statement presentation. We
believe that our
audits, which included confirmation of securities at
December 31, 1998 by
correspondence with the custodian, provide a reasonable
basis for the opinion
expressed above. The accompanying financial highlights for
the three years ended
December 31, 1996 were audited by other independent
accountants whose report
dated February 6, 1997 was unqualified.
PricewaterhouseCoopers LLP
1177 Avenue of the Americas
New York, New York
February 12, 1999
- ------------------------------------------------------------
- --------------------
11
<PAGE>
Getting The Most From Your Prudential Mutual Fund.
How many times have you read these letters -- or other
financial materials --
and stumbled across a word that you don't understand?
Many shareholders have run into the same problem. We'd like
to help. So we'll
use this space from time to time to explain some of the
words you might have
read, but not understood. And if you have a favorite word
that no one can
explain to your satisfaction, please write to us.
Basis Point: 1/100th of 1%. For example, one-half of one
percent is 50 basis
points.
Collateralized Mortgage Obligations (CMOs): Mortgage-backed
bonds that separate
mortgage pools into different maturity classes, called
tranches. These
instruments are sensitive to changes in interest rates and
homeowner
refinancing activity. They are subject to prepayment and
maturity extension
risk.
Derivatives: Securities that derive their value from other
securities. The
rate of return of these financial instruments rises and
falls -- sometimes very
suddenly -- in response to changes in some specific interest
rate, currency,
stock, or other variable.
Discount Rate: The interest rate charged by the Federal
Reserve on loans to
member banks.
Federal Funds Rate: The interest rate charged by one bank to
another on
overnight loans.
Futures Contract: An agreement to purchase or sell a
specific amount of a
commodity or financial instrument at a set price at a
specified date in the
future.
Leverage: The use of borrowed assets to enhance return. The
expectation is that
the interest rate charged on borrowed funds will be lower
than the return on
the investment. While leverage can increase profits, it can
also magnify
losses.
Liquidity: The ease with which a financial instrument (or
product) can be
bought or sold (converted into cash) in the financial
markets.
Price/Earnings Ratio: The price of a share of stock divided
by the earnings
per share for a 12-month period.
Option: An agreement to purchase or sell something, such as
shares of stock,
by a certain time for a specified price. An option need not
be exercised.
Spread: The difference between two values; often used to
describe the
difference between "bid" and "asked" prices of a security,
or between the
yields of two similar maturity bonds.
Yankee Bond: A bond sold by a foreign company or government
in the U.S. market
and denominated in U.S. dollars.
<PAGE>
Getting The Most From Your Prudential Mutual Fund.
When you invest through Prudential Mutual Funds, you receive
financial advice
through a Prudential Securities financial advisor or
Prudential/Pruco
Securities registered representative. Your advisor or
representative can
provide you with the following services:
- ------------------------------------------------------------
- -------------------
There's No Reward Without Risk; But Is This Risk Worth It?
Your financial advisor or registered representative can help
you match the
reward you seek with the risk you can tolerate. And risk can
be difficult to
gauge -- sometimes even the simplest investments bear
surprising risks. The
educated investor knows that markets seldom move in just one
direction -- there
are times when a market sector or asset class will lose
value or provide little
in the way of total return. Managing your own expectations
is easier with help
from someone who understands the markets and who knows you!
- ------------------------------------------------------------
- -------------------
Keeping Up With The Joneses.
A financial advisor or registered representative can help
you wade through the
numerous mutual funds available to find the ones that fit
your own individual
investment profile and risk tolerance. While the newspapers
and popular
magazines are full of advice about investing, they are aimed
at generic groups
of people or representative individuals, not at you
personally. Your financial
advisor or registered representative will review your
investment objectives
with you. This means you can make financial decisions based
on the assets and
liabilities in your current portfolio and your risk
tolerance -- not just
based on the current investment fad.
- ------------------------------------------------------------
- -------------------
Buy Low, Sell High.
Buying at the top of a market cycle and selling at the
bottom are among the
most common investor mistakes. But sometimes it's difficult
to hold on to an
investment when it's losing value every month. Your
financial advisor or
registered representative can answer questions when you're
confused or worried
about your investment, and remind you that you're investing
for the long haul.
<PAGE>
Prudential Mutual Funds
Gateway Center Three
100 Mulberry Street
Newark, NJ 07102-4077
(800) 225-1852
http://www.prudential.com
Directors
Edward D. Beach
Delayne Dedrick Gold
Robert F. Gunia
Don G. Hoff
Robert E. LaBlanc
Mendel A. Melzer, CFA
Robin B. Smith
Stephen Stoneburn
Brian M. Storms
Nancy H. Teeters
Officers
Brian M. Storms, President
Robert F. Gunia, Vice President
Grace C. Torres, Treasurer
Stephen M. Ungerman, Assistant Treasurer
Robert C. Rosselot, Secretary
Manager
Prudential Investments Fund Management LLC
Gateway Center Three
100 Mulberry Street
Newark, NJ 07102-4077
Investment Adviser
The Prudential Investment Corporation
Prudential Plaza
Newark, NJ 07102-3777
Distributor
Prudential Investment Management Services LLC
Gateway Center Three
100 Mulberry Street
Newark, NJ 07102-4077
Custodian
State Street Bank and Trust Company
One Heritage Drive
North Quincy, MA 02171
Transfer Agent
Prudential Mutual Fund Services LLC
P.O. Box 15005
New Brunswick, NJ 08906
Independent Accountants
PricewaterhouseCoopers LLP
1177 Avenue of the Americas
New York, NY 10036
Legal Counsel
Sullivan & Cromwell
125 Broad Street
New York, NY 10004
The views expressed in this report and information about the
Fund's portfolio
holdings are for the period covered by this report and are
subject to change
thereafter.
This report is not authorized for distribution to
prospective investors unless
preceded or accompanied by a current prospectus.
74435H102
74435H201 MF108E
