-------------------------------------------------------------------------------
AUTOMATED
-------------------------------------------------------------------------------
GOVERNMENT
-------------------------------------------------------------------------------
MONEY
-------------------------------------------------------------------------------
TRUST
-------------------------------------------------------------------------------
SEMI-ANNUAL REPORT
TO SHAREHOLDERS
JANUARY 31, 1995
[LOGO] FEDERATED SECURITIES CORP.
--------------------------------
Distributor
A subsidiary of FEDERATED INVESTORS
FEDERATED INVESTORS TOWER
PITTSBURGH, PA 15222-3779
052831104
8022501 (3/95)
PRESIDENT'S MESSAGE
--------------------------------------------------------------------------------
Dear Investor:
I am pleased to present the Semi-Annual Report to Shareholders for Automated
Government Money Trust (the "Trust") for the six-month period ended January 31,
1995. The report begins with the Investment Review, which is a brief commentary
on the short-term government market from the Trust's portfolio manager.
Following the Investment Review are Financial Statements containing the Trust's
Portfolio of Investments.
On behalf of investors, the Trust continues to pursue current income, a high
level of liquidity, and a stable net asset value of $1.00.* The Trust continues
to invest primarily in repurchase agreements backed by Treasury obligations
because of their potential yield advantage. The remainder of the portfolio is
invested in Treasury obligations.
Quality continues to be a hallmark of the Trust, which is rated AAAm by Standard
and Poor's Ratings Group ("Standard & Poor's") and Aaa by Moody's Investors
Services, Inc. ("Moody's")-- the highest ratings possible for a money market
mutual fund.**
During the six-month reporting period, dividends paid to shareholders totaled
$59.5 million, or $0.02 per share. At the end of the period, net assets stood at
$2.7 billion.
Thank you for your confidence in the Trust. As always, we welcome your
questions, comments, or suggestions.
Sincerely,
Glen R. Johnson
President
March 15, 1995
* No money market mutual fund can guarantee a stable $1 share price.
Investments in the Trust are not federally insured or guaranteed.
** These ratings are obtained after Standard & Poor's and Moody's evaluate a
number of factors, including credit quality, market price exposure, and
management. They monitor the portfolio weekly for developments that could
cause changes in ratings.
INVESTMENT REVIEW
--------------------------------------------------------------------------------
The Trust, which is rated AAAm by Standard & Poor's* and Aaa by Moody's*, is
invested in direct obligations of the U.S. Treasury, either in the form of notes
and bills or as collateral for repurchase agreements. Recently, the Trust has
been managed with a rather conservative average maturity of 30-40 days.
The Federal Reserve Board (the "Fed") continued to tighten monetary policy over
the semi-annual reporting period, raising the Fed Funds target rate 125 basis
points from 4.25% to 5.50%. Short-term interest rates led the Fed moves upward,
as the rate on the three month Treasury bill rose from 4.4% to 6.0% over the
reporting period. We anticipate that in early February, the Fed will move once
more, raising the target rate to 6%.
The Trust's average maturity remained in the 30-40 day target range that it
adopted with the onset of the increase in rates by the Fed in February 1994. A
potential yield advantage continued to exist for investments in repurchase
agreements versus direct investments in short-term Treasury securities. The
Trust combined this position in repurchase agreements with the purchase of
securities with longer maturities of six to twelve months. We believe that this
portfolio structure will best enable the Trust to pursue a competitive yield.
It appears that the Fed may be nearing the end of its tightening process. There
are signs of slowing in economic growth and indications that inflation is still
being held reasonably in check, and expectations are that the Fed will be
cautious in increasing rates further before the effects of the policy moves
taken so far are known. Additional tightenings from the Fed cannot be ruled out
completely, however. The Trust would look to reinforce its barbelled structure
should market opportunities permit, and will attempt to maximize performance
through ongoing relative value analysis. However, changing economic and market
developments are continuously monitored to best serve our clients attracted to
the short-term U.S. government market.
* These ratings are obtained after Standard & Poor's and Moody's evaluate a
number of factors, including credit quality, market price exposure, and
management. They monitor the portfolio weekly for developments that could
cause changes in ratings.
AUTOMATED GOVERNMENT MONEY TRUST
PORTFOLIO OF INVESTMENTS
JANUARY 31, 1995
(UNAUDITED)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
<C> <S> <C>
-------------- ------------------------------------------------------------------------------- ----------------
SHORT-TERM U.S. TREASURY OBLIGATIONS--23.9%
-----------------------------------------------------------------------------------------------
*U.S. TREASURY BILLS--15.9%
-------------------------------------------------------------------------------
$ 434,000,000 3.78%-6.90%, 2/9/95-10/19/95 $ 425,456,972
-------------------------------------------------------------------------------
U.S. TREASURY NOTES--8.0%
-------------------------------------------------------------------------------
215,000,000 3.875%-7.75%, 2/15/95-9/30/95 214,017,766
------------------------------------------------------------------------------- ----------------
TOTAL SHORT-TERM U.S. TREASURY OBLIGATIONS 639,474,738
------------------------------------------------------------------------------- ----------------
**REPURCHASE AGREEMENTS--76.1%
-----------------------------------------------------------------------------------------------
100,000,000 B.A. Securities, Inc., 5.820%, dated 1/31/95, due 2/1/95 100,000,000
-------------------------------------------------------------------------------
250,000,000 BT Securities Corporation, 5.860%, dated 1/31/95, due 2/1/95 250,000,000
-------------------------------------------------------------------------------
113,900,000 BZW Securities, Inc., 5.840%, dated 1/31/95, due 2/1/95 113,900,000
-------------------------------------------------------------------------------
50,000,000 Bear, Stearns & Co., Inc., 5.875%, dated 1/31/95, due 2/1/95 50,000,000
-------------------------------------------------------------------------------
130,000,000 Chase Securities, Inc., 5.800%, dated 1/31/95, due 2/1/95 130,000,000
-------------------------------------------------------------------------------
125,000,000 Chemical Securities, Inc., 5.820%, dated 1/31/95, due 2/1/95 125,000,000
-------------------------------------------------------------------------------
85,000,000 Deutsche Bank Government Securities, Inc., 5.870%, dated 1/31/95,
due 2/1/95 85,000,000
-------------------------------------------------------------------------------
120,000,000 First Chicago Capital Markets, Inc., 5.820%, dated 1/31/95,
due 2/1/95 120,000,000
-------------------------------------------------------------------------------
80,000,000 Fuji Securities, Inc., 5.820%, dated 1/31/95, due 2/1/95 80,000,000
-------------------------------------------------------------------------------
120,000,000 Harris, Nesbitt, Thomson Securities, Inc., 5.820%, dated 1/31/95,
due 2/1/95 120,000,000
-------------------------------------------------------------------------------
79,405,000 J.P. Morgan Securities, Inc., 5.870%, dated 1/31/95, due 2/2/95 79,405,000
-------------------------------------------------------------------------------
120,000,000 Lehman Government Securities, 5.830%, dated 1/31/95,
due 2/1/95 120,000,000
-------------------------------------------------------------------------------
125,000,000 Nationsbank of North Carolina, N.A., 5.820%, dated 1/31/95,
due 2/1/95 125,000,000
-------------------------------------------------------------------------------
60,000,000 Nikko Securities Co. International, Inc., 5.820%, dated 1/31/95,
due 2/1/95 60,000,000
-------------------------------------------------------------------------------
REPURCHASE AGREEMENTS--CONTINUED
-----------------------------------------------------------------------------------------------
$ 125,000,000 Nomura Securities International, Inc., 5.820%, dated 1/31/95,
due 2/1/95 $ 125,000,000
-------------------------------------------------------------------------------
100,000,000 State Street Bank & Trust Company, 5.820%, dated 1/31/95,
due 2/1/95 100,000,000
-------------------------------------------------------------------------------
55,000,000 UBS Securities, Inc., 5.860%, dated 1/31/95, due 2/1/95 55,000,000
-------------------------------------------------------------------------------
52,000,000 Goldman, Sachs & Co., 5.480%, dated 1/11/95, due 2/1/95 52,000,000
-------------------------------------------------------------------------------
47,000,000 Lehman Government Securities, 6.100%, dated 1/20/95, due 4/20/95 47,000,000
-------------------------------------------------------------------------------
47,000,000 Morgan Stanley & Co., Inc., 5.530%, dated 1/11/95, due 2/1/95 47,000,000
-------------------------------------------------------------------------------
50,000,000 Morgan Stanley & Co., Inc., 6.100%, dated 12/9/94, due 3/8/95 50,000,000
------------------------------------------------------------------------------- ----------------
TOTAL REPURCHASE AGREEMENTS 2,034,305,000
------------------------------------------------------------------------------- ----------------
TOTAL INVESTMENTS, AT AMORTIZED COST $ 2,673,779,738+
------------------------------------------------------------------------------- ----------------
</TABLE>
Also represents cost for federal tax purposes.
Although final maturity falls beyond seven days a liquidity feature is included
in each transaction to permit termination of the repurchase agreement within
seven days.
* Reflects rate of discount at time of purchase.
** Repurchase agreements are fully collateralized by U.S. Treasury obligations
based on market prices at the date of the portfolio. The investments in
repurchase agreements are through participation in joint accounts with other
Federated funds.
Note: The categories of investments are shown as a percentage of net assets
($2,672,383,178) at January 31, 1995.
(See Notes which are an integral part of the Financial Statements)
AUTOMATED GOVERNMENT MONEY TRUST
STATEMENT OF ASSETS AND LIABILITIES
JANUARY 31, 1995
(UNAUDITED)
--------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
ASSETS:
-----------------------------------------------------------------------------
Investments in repurchase agreements $ 2,034,305,000
-----------------------------------------------------------------------------
Investments in securities 639,474,738
----------------------------------------------------------------------------- ----------------
Total investments in securities, at value $ 2,673,779,738
-----------------------------------------------------------------------------------------------
Cash 29,030,259
-----------------------------------------------------------------------------------------------
Income receivable 5,562,727
-----------------------------------------------------------------------------------------------
Receivable for shares sold 60,471,246
----------------------------------------------------------------------------------------------- ----------------
Total assets 2,768,843,970
-----------------------------------------------------------------------------------------------
LIABILITIES:
-----------------------------------------------------------------------------------------------
Payable for shares redeemed 88,334,671
-----------------------------------------------------------------------------
Income distribution payable 7,634,434
-----------------------------------------------------------------------------
Accrued expenses 491,687
----------------------------------------------------------------------------- ----------------
Total liabilities 96,460,792
----------------------------------------------------------------------------------------------- ----------------
NET ASSETS for 2,672,383,178 shares outstanding $ 2,672,383,178
----------------------------------------------------------------------------------------------- ----------------
NET ASSET VALUE, Offering Price and Redemption Proceeds Per Share:
($2,672,383,178 / 2,672,383,178 shares outstanding) $1.00
----------------------------------------------------------------------------------------------- ----------------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
AUTOMATED GOVERNMENT MONEY TRUST
STATEMENT OF OPERATIONS
SIX MONTHS ENDED JANUARY 31, 1995
(UNAUDITED)
--------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
--------------------------------------------------------------------------------------------------
Interest $ 67,107,261
--------------------------------------------------------------------------------------------------
EXPENSES:
--------------------------------------------------------------------------------------------------
Investment advisory fee $ 6,637,866
-----------------------------------------------------------------------------------
Administrative personnel and services fee 1,004,973
-----------------------------------------------------------------------------------
Custodian fees 185,860
-----------------------------------------------------------------------------------
Transfer and dividend disbursing agent fees and expenses 57,086
-----------------------------------------------------------------------------------
Trustees' fees 18,032
-----------------------------------------------------------------------------------
Auditing fees 7,544
-----------------------------------------------------------------------------------
Legal fees 27,968
-----------------------------------------------------------------------------------
Portfolio accounting fees 63,724
-----------------------------------------------------------------------------------
Shareholder services fee 3,318,933
-----------------------------------------------------------------------------------
Share registration costs 18,400
-----------------------------------------------------------------------------------
Printing and postage 6,072
-----------------------------------------------------------------------------------
Insurance premiums 23,736
-----------------------------------------------------------------------------------
Taxes 3,864
-----------------------------------------------------------------------------------
Miscellaneous 20,673
----------------------------------------------------------------------------------- -------------
Total expenses 11,394,731
-----------------------------------------------------------------------------------
Deduct--Waiver of investment advisory fee 3,827,314
----------------------------------------------------------------------------------- -------------
Net expenses 7,567,417
-------------------------------------------------------------------------------------------------- -------------
Net investment income $ 59,539,844
-------------------------------------------------------------------------------------------------- -------------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
AUTOMATED GOVERNMENT MONEY TRUST
STATEMENT OF CHANGES IN NET ASSETS
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JANUARY 31, 1995 YEAR ENDED
(UNAUDITED) JULY 31, 1994
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
------------------------------------------------------------------------
OPERATIONS--
------------------------------------------------------------------------
Net investment income $ 59,539,844 $ 86,375,459
------------------------------------------------------------------------ ------------------- ------------------
DISTRIBUTIONS TO SHAREHOLDERS--
------------------------------------------------------------------------
Distributions from net investment income (59,539,844) (86,375,459)
------------------------------------------------------------------------ ------------------- ------------------
SHARE TRANSACTIONS--
------------------------------------------------------------------------
Proceeds from sale of Shares 8,338,705,770 20,353,705,672
------------------------------------------------------------------------
Net asset value of Shares issued to shareholders in payment of
distributions declared 18,461,838 28,190,212
------------------------------------------------------------------------
Cost of Shares redeemed (8,325,168,297) (20,857,284,325)
------------------------------------------------------------------------ ------------------- ------------------
Change in net assets resulting from share transactions 31,999,311 (475,388,441)
------------------------------------------------------------------------ ------------------- ------------------
Change in net assets 31,999,311 (475,388,441)
------------------------------------------------------------------------
NET ASSETS:
------------------------------------------------------------------------
Beginning of period 2,640,383,867 3,115,772,308
------------------------------------------------------------------------ ------------------- ------------------
End of period $ 2,672,383,178 $ 2,640,383,867
------------------------------------------------------------------------ ------------------- ------------------
</TABLE>
(See Notes which are an integral part of the Financial Statements)
AUTOMATED GOVERNMENT MONEY TRUST
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)
<TABLE>
<CAPTION>
SIX MONTHS
ENDED JANUARY
31,
(UNAUDITED) YEAR ENDED JULY 31,
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1995 1994 1993 1992 1991 1990 1989 1988 1987
NET ASSET VALUE,
BEGINNING OF PERIOD $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-----------------------
INCOME FROM
INVESTMENT OPERATIONS
-----------------------
Net investment income 0.02 0.03 0.03 0.04 0.07 0.08 0.08 0.06 0.06
-----------------------
LESS DISTRIBUTIONS
-----------------------
Distributions from net
investment income (0.02) (0.03) (0.03) (0.04) (0.07) (0.08) (0.08) (0.06) (0.06)
----------------------- ----- --------- --------- --------- --------- --------- --------- --------- ---------
NET ASSET VALUE, END
OF PERIOD $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
----------------------- ----- --------- --------- --------- --------- --------- --------- --------- ---------
TOTAL RETURN (A) 2.28% 2.95% 2.79% 4.26% 6.77% 8.21% 8.58% 6.55% 5.73%
-----------------------
RATIOS TO AVERAGE
NET ASSETS
-----------------------
Expenses 0.57%(b) 0.57% 0.55% 0.57% 0.55% 0.55% 0.55% 0.55% 0.55%
-----------------------
Net investment income 4.48%(b) 2.88% 2.75% 4.17% 6.55% 7.92% 8.30% 6.39% 5.59%
-----------------------
Expense waiver/
reimbursement (c) 0.29%(b) 0.06% 0.01% 0.01% 0.03% 0.03% 0.04% 0.03% 0.02%
-----------------------
SUPPLEMENTAL DATA
-----------------------
Net assets, end of
period (000 omitted) $2,672,383 $2,640,384 $3,115,772 $3,177,695 $2,829,602 $2,596,695 $2,791,097 $2,388,700 $1,536,578
-----------------------
<CAPTION>
<S> <C>
1986
NET ASSET VALUE,
BEGINNING OF PERIOD $ 1.00
-----------------------
INCOME FROM
INVESTMENT OPERATIONS
-----------------------
Net investment income 0.07
-----------------------
LESS DISTRIBUTIONS
-----------------------
Distributions from net
investment income (0.07)
----------------------- ---------
NET ASSET VALUE, END
OF PERIOD $ 1.00
----------------------- ---------
TOTAL RETURN (A) 7.11%
-----------------------
RATIOS TO AVERAGE
NET ASSETS
-----------------------
Expenses 0.55%
-----------------------
Net investment income 6.86%
-----------------------
Expense waiver/
reimbursement (c) 0.03%
-----------------------
SUPPLEMENTAL DATA
-----------------------
Net assets, end of
period (000 omitted) $1,782,895
-----------------------
</TABLE>
(a) Based on net asset value which does not reflect the sales load or
contingent deferred sales charge, if applicable.
(b) Computed on an annualized basis.
(c) This voluntary expense decrease is reflected in both the expense and net
investment income ratios shown above.
(See Notes which are an integral part of the Financial Statements)
AUTOMATED GOVERNMENT MONEY TRUST
NOTES TO FINANCIAL STATEMENTS
JANUARY 31, 1995
(UNAUDITED)
--------------------------------------------------------------------------------
(1) ORGANIZATION
Automated Government Money Trust (the "Trust") is registered under the
Investment Company Act of 1940, as amended (the "Act"), as a diversified,
open-end management investment company.
(2) SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Trust in the preparation of its financial statements. These
policies are in conformity with generally accepted accounting principles.
A. INVESTMENT VALUATIONS--The Trust's use of the amortized cost method to
value its portfolio securities is in accordance with Rule 2a-7 under the
Act.
B. REPURCHASE AGREEMENTS--It is the policy of the Trust to require the
custodian bank to take possession, to have legally segregated in the
Federal Reserve Book Entry System or to have segregated within the
custodian bank's vault, all securities held as collateral in support of
repurchase agreement transactions. Additionally, procedures have been
established by the Trust to monitor, on a daily basis, the market value of
each repurchase agreement's underlying collateral to ensure that the value
of collateral at least equals the repurchase price to be paid under the
repurchase agreement transaction.
The Trust will only enter into repurchase agreements with banks and other
recognized financial institutions such as broker/dealers, which are deemed
by the Trust's adviser to be creditworthy pursuant to the guidelines and/or
standards reviewed or established by the Board of Trustees (the
"Trustees").
C. INVESTMENT INCOME, EXPENSES AND DISTRIBUTIONS--Interest income and expenses
are accrued daily. Bond premium and discount, if applicable, are amortized
as required by the Internal Revenue Code, as amended (the "Code").
Distributions to shareholders are recorded on the ex-dividend date.
D. FEDERAL TAXES--It is the Trust's policy to comply with the provisions of
the Code applicable to regulated investment companies and to distribute to
shareholders each year substantially all of its income. Accordingly, no
provisions for federal tax are necessary.
E. WHEN-ISSUED OR DELAYED DELIVERY TRANSACTIONS--The Trust may engage in
when-issued or delayed delivery transactions. The Trust records when-issued
securities on the trade date and maintains security positions such that
sufficient liquid assets will be available to make payment for the
securities purchased. Securities purchased on a when-issued or delayed
delivery basis are marked to market daily and begin earning interest on the
settlement date.
F. OTHER--Investment transactions are accounted for on the trade date.
(3) SHARES OF BENEFICIAL INTEREST
The Declaration of Trust permits the Trustees to issue an unlimited number of
full and fractional shares of beneficial interest (without par value).
At January 31, 1995, capital paid-in aggregated $2,672,383,178.
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
JANUARY 31, 1995 JULY 31, 1994
<S> <C> <C>
-------------------------------------------------------------------------
Shares sold 8,338,705,770 20,353,705,672
-------------------------------------------------------------------------
Shares issued to shareholders in payment of dividends declared 18,461,838 28,190,212
-------------------------------------------------------------------------
Shares redeemed (8,325,168,297) (20,857,284,325)
------------------------------------------------------------------------- ------------------- -----------------
Net change resulting from share transactions 31,999,311 (475,388,441)
------------------------------------------------------------------------- ------------------- -----------------
</TABLE>
(4) INVESTMENT ADVISORY FEE AND OTHER TRANSACTIONS WITH AFFILIATES
INVESTMENT ADVISORY FEE--Federated Management, the Trust's investment adviser
(the "Adviser"), receives for its services an annual investment advisory fee
equal to .50 of 1% of the Trust's average daily net assets. The Adviser may
voluntarily choose to waive a portion of its fee. The Adviser can modify or
terminate this voluntary waiver at any time at its sole discretion.
ADMINISTRATIVE FEE--Federated Administrative Services ("FAS") provides the Trust
with administrative personnel and services. The FAS fee is based on the level of
average aggregate daily net assets of all funds advised by subsidiaries of
Federated Investors for the period. The administrative fee received during the
period of the Administrative Services Agreement shall be at least $125,000 per
portfolio and $30,000 per each additional class of shares.
SHAREHOLDER SERVICES FEE--Under the terms of a Shareholder Services Agreement
with Federated Shareholder Services ("FSS"), the Trust will pay FSS up to .25 of
1% of average net assets of the Trust for the period. This fee is to obtain
certain services for shareholders and to maintain the shareholder accounts.
TRANSFER AND DIVIDEND DISBURSING AGENT FEES--Federated Services Company
("FServ") serves as transfer and dividend disbursing agent for the Trust. The
fee is based on the size, type, and number of accounts and transactions made by
shareholders.
PORTFOLIO ACCOUNTING FEES--FServ also maintains the Trust's accounting records
for which it receives a fee. The fee is based on the level of the Trust's
average net assets for the period plus out-of-pocket expenses.
GENERAL--Certain of the Officers and Trustees of the Trust are Officers and
Directors or Trustees of the above companies.
TRUSTEES OFFICERS
--------------------------------------------------------------------------------
<TABLE>
<S> <C>
John F. Donahue John F. Donahue
Thomas G. Bigley Chairman
John T. Conroy, Jr. Glen R. Johnson
William J. Copeland President
James E. Dowd J. Christopher Donahue
Lawrence D. Ellis, M.D. Vice President
Edward L. Flaherty, Jr. Richard B. Fisher
Peter E. Madden Vice President
Gregor F. Meyer Edward C. Gonzales
Wesley W. Posvar Vice President and Treasurer
Marjorie P. Smuts John W. McGonigle
Vice President and Secretary
David M. Taylor
Assistant Treasurer
G. Andrew Bonnewell
Assistant Secretary
</TABLE>
---------
Mutual funds are not bank deposits or obligations, are not guaranteed
by any bank, and are not insured or guaranteed by the U.S. government,
the Federal Deposit Insurance Corporation, the Federal Reserve Board, or
any other government agency. Investment in mutual funds involves
investment risk, including possible loss of principal. Although money market
funds seek to maintain a stable net asset value of $1.00 per share, there is no
assurance that they will be able to do so.
This report is authorized for distribution to prospective investors only when
preceded or accompanied by the Fund's prospectus which contains facts
concerning its objective and policies, management fees, expenses and
other information.
