MANAGED GOVERNMENT SECURITIES FUND
MANAGED FEDERAL SECURITIES FUND
MANAGED CASH FUND
MANAGED TAX-FREE FUND
- --------------------------------------------------------------------------------
ANNUAL REPORT
DECEMBER 31, 1995
- --------------------------------------------------------------------------------
<PAGE>
Board of Directors
DAVID S. LEE(1) Chairman of the Board; Managing Director,
Scudder, Stevens & Clark, Inc.
EDGAR R. FIEDLER(1) (2) (3) Vice President and Economic Counsellor, The
Conference Board; formerly Assistant
Secretary of the Treasury for Economic Policy
PETER B. FREEMAN(2) (3) Corporate Director and Trustee
ROBERT W. LEAR(2) (3) Executive-in-Residence and Visiting
Professor, Columbia University Graduate
School of Business; Director or Trustee,
Various Organizations
DANIEL PIERCE(1) President; Chairman of the Board, Scudder,
Stevens & Clark, Inc.
(1)Member of Executive Committee
(2)Member of Nominating Committee
(3)Member of Audit Committee
- --------------------------------------------------------------------------------
Officers
DAVID S. LEE Chairman of the Board
DANIEL PIERCE President
K. SUE COTE Vice President
JERARD K. HARTMAN Vice President
KATHRYN L. QUIRK Vice President
THOMAS W. JOSEPH Vice President and Assistant Secretary
THOMAS F. McDONOUGH Vice President and Assistant Secretary
PAMELA A. McGRATH Vice President and Treasurer
IRENE McC. PELLICONI Secretary
2
<PAGE>
Dear Shareholder:
Operated exclusively for institutions and their clients, Scudder Fund,
Inc., which includes Managed Government Securities Fund, Managed Federal
Securities Fund, Managed Cash Fund, and Managed Tax-Free Fund, provided
competitive investment results in 1995. These four money market Funds seek to
provide a high level of income while preserving capital and maintaining
liquidity.
All four Funds seek to maintain a net asset value of $1.00, and have done
so since their inception (although this cannot be guaranteed). The Managed
Federal Securities Fund seeks to maximize income exempt from state and local
income taxes, while the Managed Tax-Free Fund seeks to provide income exempt
from Federal income tax.
Aggregate net assets were $568 million on December 31, 1995, compared to
$573 million at the start of the year. A table showing dividend payments and
other financial information for the twelve months ended December 31, 1995 is on
page 16. This table also shows dividend payments and financial information for
each Fund for the five years ended December 31 (except the Managed Federal
Securities Fund, which commenced operations on July 17, 1991). In addition,
please see the following pages for audited financial statements for the year
ended December 31, 1995, as well as a list of each Fund's investments.
If you have any questions concerning Scudder Fund, Inc., please call toll
free (800) 854-8525 from any continental state.
/s/David S. Lee
David S. Lee
Chairman
3
<PAGE>
MANAGED GOVERNMENT SECURITIES FUND
STATEMENT OF NET ASSETS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
MATURITY PRINCIPAL VALUE
DATE AMOUNT (NOTE 2a)
-------- --------- ---------
<S> <C> <C> <C>
REPURCHASE AGREEMENTS -- 12.8%
Donaldson, Lufkin & Jenrette Securities Corp., dated
12/29/95 at 5.85% (proceeds at maturity $6,400,157)
collateralized by $3,891,000 U.S. Treasury Bond,
12.5%, 8/15/14 (cost $6,396,000) (note 3)................... 1/2/96 $ 6,396,000 $ 6,396,000
-----------
U.S. AGENCY OBLIGATIONS -- 88.0%
Federal Farm Credit Bank Discount Note........................ 2/6/96 950,000 944,727
Federal Farm Credit Bank Discount Note........................ 3/11/96 5,000,000 4,946,528
Federal Home Loan Bank Discount Note.......................... 1/18/96 6,000,000 5,984,020
Federal Home Loan Bank Discount Note.......................... 1/26/96 2,600,000 2,589,943
Federal Home Loan Bank Discount Note.......................... 2/5/96 2,000,000 1,989,189
Federal Home Loan Bank Discount Note.......................... 2/9/96 4,550,000 4,522,742
Federal National Mortgage Assn. Discount Note................. 1/17/96 3,600,000 3,590,928
Federal National Mortgage Assn. Discount Note................. 2/21/96 3,500,000 3,472,581
Federal National Mortgage Assn. Discount Note................. 2/27/96 2,000,000 1,982,425
Federal National Mortgage Assn. Medium Term Note, 5.68%....... 3/14/96* 5,000,000 5,000,000
Tennessee Valley Authority Discount Note...................... 1/3/96 2,000,000 1,999,381
Tennessee Valley Authority Discount Note...................... 1/18/96 3,000,000 2,992,123
Tennessee Valley Authority Discount Note...................... 2/2/96 4,000,000 3,980,338
-----------
TOTAL U.S. AGENCY OBLIGATIONS (cost $43,994,925).......................................... 43,994,925
-----------
TOTAL INVESTMENTS -- 100.8% (cost $50,390,925)**........................................... 50,390,925
-----------
OTHER ASSETS AND LIABILITIES -- (0.8%)
Cash...................................................................................... 1,128
Interest receivable and other assets...................................................... 62,546
Dividend payable.......................................................................... (236,751)
Payable for capital stock redeemed........................................................ (56,862)
Management fee payable (note 4)........................................................... (6,163)
Accrued expenses (note 4)................................................................. (179,099)
-----------
(415,201)
-----------
NET ASSETS -- 100.0%
Applicable to 49,975,724 shares of $.001 par value Capital Stock outstanding;
3,000,000,000 shares authorized (note 7)................................................ $49,975,724
===========
NET ASSET VALUE PER SHARE................................................................. $ 1.00
===========
</TABLE>
* Date of next interest rate change.
** Cost for federal income tax purposes.
See notes to financial statements.
4
<PAGE>
MANAGED FEDERAL SECURITIES FUND
STATEMENT OF NET ASSETS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
MATURITY PRINCIPAL VALUE
DATE AMOUNT (NOTE 2a)
-------- --------- ---------
<S> <C> <C> <C>
U.S. TREASURY OBLIGATIONS -- 100.7%
U.S. Treasury Bill............................................ 1/25/96 $3,050,000 $3,039,122
U.S. Treasury Bill............................................ 2/8/96 2,000,000 1,990,711
U.S. Treasury Bill............................................ 3/7/96 1,700,000 1,685,040
U.S. Treasury Bill............................................ 3/28/96 2,000,000 1,976,558
----------
TOTAL U.S. TREASURY OBLIGATIONS (cost $8,691,431)**....................................... 8,691,431
----------
OTHER ASSETS AND LIABILITIES -- (0.7%)
Cash...................................................................................... 15,926
Other assets.............................................................................. 4,895
Dividend payable.......................................................................... (32,948)
Accrued expenses (note 4)................................................................. (47,381)
----------
(59,508)
----------
NET ASSETS -- 100.0%
Applicable to 8,631,923 shares of $.001 par value Capital Stock
outstanding; 1,000,000,000 shares authorized (note 7)................................... $8,631,923
==========
NET ASSET VALUE PER SHARE................................................................. $1.00
=====
</TABLE>
** Cost for federal income tax purposes.
See notes to financial statements.
5
<PAGE>
MANAGED CASH FUND
STATEMENT OF NET ASSETS
DECEMBER 31, 1995
<TABLE>
MATURITY PRINCIPAL VALUE
DATE AMOUNT (NOTE 2a)
-------- --------- ----------
<S> <C> <C> <C>
CERTIFICATES OF DEPOSIT -- 27.7%
Bank of Nova Scotia, 5.75%............ 3/15/96 $10,000,000 $ 10,000,566
Bayerische Landesbank, 5.79%.......... 1/24/96 10,000,000 10,000,063
Bayerische Vereinsbank, 5.78%......... 1/23/96 5,000,000 5,000,000
Credit Suisse Zurich (Yankee), 5.75%.. 1/22/96 10,000,000 10,000,058
Harris Trust and Savings Bank, 5.6%... 2/12/96 15,000,000 15,000,000
Lloyds Bank (Yankee), 5.76%........... 4/10/96 7,000,000 7,000,189
National Bank of Detroit, 5.79%....... 1/5/96 19,000,000 19,000,041
Royal Bank of Canada, 5.735%.......... 3/13/96 10,000,000 10,000,293
Societe Generale (Yankee), 5.75%...... 2/28/96 10,000,000 10,000,000
Swiss Bank Corp., 5.67%............... 3/25/96 7,000,000 6,998,599
------------
TOTAL CERTIFICATES OF DEPOSIT
(cost $102,999,809).............................................. 102,999,809
-----------
COMMERCIAL PAPER--58.0%
AT&T Corp............................. 4/9/96 10,000,000 9,846,275
American Express Credit Corp.......... 3/6/96 5,000,000 4,949,715
American Express Credit Corp.......... 3/20/96 10,000,000 9,876,672
Associates Corp. of North America..... 2/5/96 10,000,000 9,944,681
Barclays U.S. Funding Corp............ 1/8/96 10,000,000 9,988,936
BellSouth Telecommunications, Inc..... 2/9/96 10,000,000 9,938,900
Ciesco L.P............................ 1/18/96 10,000,000 9,973,131
Corestates Bank Discount Note......... 3/18/96 10,000,000 9,879,794
Corporate Asset Funding Co. Inc....... 1/26/96 5,000,000 4,980,486
Corporate Asset Funding Co. Inc....... 2/1/96 10,000,000 9,951,519
Credit Agricole U.S.A................. 2/14/96 10,000,000 9,931,556
Deere Capital Corp.................... 1/16/96 7,000,000 6,983,317
Deutsche Bank Financial Inc........... 4/10/96 7,000,000 6,891,111
General Electric Capital Corp......... 2/16/96 10,000,000 9,928,061
J.P. Morgan & Co. Inc................. 1/31/96 11,798,000 11,742,943
New Center Asset Trust................ 1/19/96 10,000,000 9,971,450
Pitney Bowes Credit Corp.............. 2/13/96 10,000,000 9,932,753
Prudential Funding Corp............... 1/24/96 10,000,000 9,963,711
Retailer Funding Corp................. 1/22/96 10,000,000 9,966,662
Rincon Securities Inc.
(LOC Trust Co. of Georgia).......... 1/12/96 10,100,000 10,082,440
Transamerica Finance Corp............. 1/18/96 11,155,000 11,124,922
Weyerhaeuser Mortgage Co.............. 1/24/96 10,000,000 9,964,222
Wisconsin Power & Light Co............ 2/8/96 10,000,000 9,939,622
-----------
TOTAL COMMERCIAL PAPER
(cost $215,752,879).............................................. 215,752,879
-----------
</TABLE>
See notes to financial statements.
6
<PAGE>
<TABLE>
MATURITY PRINCIPAL VALUE
DATE AMOUNT (NOTE 2a)
-------- --------- ---------
<S> <C> <C> <C>
REPURCHASE AGREEMENT--2.1%
Donaldson, Lufkin & Jenrette
Securities Corp., dated 12/29/95
at 5.85% (proceeds at maturity
$7,750,034) collateralized by
$5,087,000 U.S. Treasury Note,
12.75%, 11/15/10 (cost $7,745,000)..... 1/2/96 $ 7,745,000 $ 7,745,000
-----------
U.S. GOVERNMENT AGENCY OBLIGATIONS--10.1%
Student Loan Marketing Association
Variable Rate Note, 5.22%.............. 1/2/96* 15,000,000 15,000,000
Student Loan Marketing Association
Variable Rate Note, 5.24%.............. 1/2/96* 22,400,000 22,393,954
------------
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS
(cost $37,393,954).................................................. 37,393,954
------------
NOTES--2.8%
Adesa Funding Corp. (LOC Banc One),
5.83%.................................. 1/4/96* 2,846,000 2,846,000
General Electric Capital Corp., 7.625%... 1/10/97 2,000,000 2,043,700
MMR Funding I (LOC Bayerische
Vereinsbank), 6%....................... 1/4/96* 5,500,000 5,500,000
------------
TOTAL NOTES (cost $10,389,000)....................................... 10,389,700
-----------
TOTAL INVESTMENTS--100.7%
(cost $374,281,342)**.............................................. 374,281,342
------------
OTHER ASSETS AND LIABILITIES--(0.7%)
Cash........................................................... 170,646
Receivable for capital stock sold.............................. 345,432
Interest receivable and other assets........................... 1,296,531
Dividend payable............................................... (1,719,668)
Payable for investments purchased.............................. (2,089,026)
Payable for capital stock redeemed............................. (301,778)
Management fee payable (note 4)................................ (133,410)
Accrued expenses (note 4)...................................... (330,974)
------------
(2,762,247)
------------
NET ASSETS--100.0%
Applicable to 371,681,175 shares of $.001 par value Capital
Stock outstanding; 3,000,000,000 shares authorized
(note 7)..................................................... $371,519,095
============
NET ASSET VALUE PER SHARE...................................... $1.00
=====
</TABLE>
*Date of next interest rate change.
**Cost for federal income tax purposes.
ABBREVIATIONS USED IN THE STATEMENT:
LOC Letter of Credit
See notes to financial statements.
7
<PAGE>
MANAGED TAX-FREE FUND
STATEMENT OF NET ASSETS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
CREDIT PRINCIPAL VALUE
RATING* SHORT-TERM MUNICIPAL SECURITIES -- 100.0% AMOUNT (NOTE 2a)
- ------- --------- ---------
<S> <C> <C> <C>
ARIZONA - 6.7%
A-1+ Maricopa County Public Service Palo Verde Project Series 1994-B VRDN,
5.95%, 5/1/29......................................................... $1,000,000 $ 1,000,000
VMIG-1 Pima County Industrial Development Authority Series 1985 SFE
Technologies Project VRDN, 5.5%, 12/1/05.............................. 2,300,000 2,300,000
A-1+ Salt River Agricultural Improvement District TECP, 3.75%, 2/16/96........... 2,006,000 2,006,000
A-1+ Salt River Agricultural Improvement District TECP, 3.75%, 2/22/96........... 1,000,000 1,000,000
A-1 Salt River Project Electric System Revenue Refunding Series 1992-A
TOB, 5.05%, 1/1/09.................................................... 3,000,000 3,000,000
-----------
TOTAL ARIZONA................................................... 9,306,000
-----------
ARKANSAS - 0.0%
VMIG-1 Jonesboro Industrial Revenue Bond Farr Co. Project VRDN, 5.6%, 12/1/01...... 5,000 5,000
-----------
CALIFORNIA - 19.0%
SP-1+ California Community College Finance Authority Series B TRAN,
5%, 8/30/96........................................................... 1,500,000 1,504,744
A-1 Corona Multi-Family Housing Revenue Series 1985-B VRDN,
5.375%, 2/1/05........................................................ 2,000,000 2,000,000
SS&C Huntington Beach Multi-Family Housing Revenue River Meadows
Apartments Series B VRDN, 5.225%, 10/1/05............................. 6,800,000 6,800,000
A-1 Lancaster Multi-Family Housing Revenue Series 1984-A
VRDN, 5.375%, 11/1/04................................................. 3,000,000 3,000,000
MIG-1 Los Angeles County TRAN, 4.5%, 7/1/96....................................... 1,000,000 1,003,350
SP-1+ Los Angeles County Local Educational Agencies TRAN, 4.75%, 7/5/96........... 1,000,000 1,003,170
SS&C San Macros Multi-Family Housing Revenue Household Bank Project
Series 1985 VRDN, 5.375%, 6/1/05...................................... 6,900,000 6,900,000
SP-1+ South Coast local Education Agencies TRAN, 5%, 8/14/96...................... 1,000,000 1,002,953
MIG-1 State of California Revenue Anticipation Warrants Series C, 5.75%, 4/25/96.. 3,000,000 3,017,395
-----------
TOTAL CALIFORNIA................................................ 26,231,612
-----------
COLORADO - 6.3%
A-1+ Colorado Health Facilities Authority Composite Issue For Kaiser
Permamente Series 1995-A VRDN, 5.2%, 8/1/15........................... 1,000,000 1,000,000
SP-1+ Colorado State Series A TRAN, 4.5%, 6/27/96................................. 1,500,000 1,505,969
VMIG-1 Colorado Student Loan Obligation Bond Authority Series 1990-C VRDN,
5.35%, 3/1/00......................................................... 4,450,000 4,450,000
A-1 Regional Transportation District Special Passenger Fair Revenue Bond
VRDN, 5.25%, 6/1/99................................................... 1,700,000 1,700,000
-----------
TOTAL COLORADO.................................................. 8,655,969
-----------
DISTRICT OF COLUMBIA - 1.4%
VMIG-1 District of Columbia GO Refunding Bonds Series A-2 VRDN, 6%, 10/1/07........ 300,000 300,000
VMIG-1 District of Columbia GO Refunding Bonds Series A-3 VRDN, 6%, 10/1/07........ 1,100,000 1,100,000
VMIG-1 District of Columbia GO Refunding Bonds Series A-4 VRDN, 6%, 10/1/07........ 600,000 600,000
-----------
TOTAL DISTRICT OF COLUMBIA...................................... 2,000,000
-----------
</TABLE>
See notes to financial statements.
8
<PAGE>
<TABLE>
<CAPTION>
CREDIT PRINCIPAL VALUE
RATING* AMOUNT (NOTE 2a)
- ------- --------- ---------
<S> <C> <C> <C>
FLORIDA - 7.6%
VMIG-1 Broward County Housing Finance Authority Welleby Apartments
Project VRDN, 5.35%, 12/1/06............................................. $1,000,000 $ 1,000,000
A-1+ Dade County Water and Sewer System Revenue Series 1994 VRDN
FGIC Insured, 4.9%, 10/5/22.............................................. 4,700,000 4,700,000
VMIG-1 Jacksonville Health Facilities Authority Baptist Medical Center VRDN,
4.8%, 7/1/14............................................................. 4,825,000 4,825,000
-----------
TOTAL FLORIDA................................................... 10,525,000
-----------
GEORGIA - 4.6%
P-1 Hapeville Industrial Development Bond Hapeville Hotel VRDN,
6%, 11/1/15.............................................................. 3,100,000 3,100,000
VMIG-1 Savannah Downtown Development Authority Series 1985 VRDN,
5.375%, 5/1/15........................................................... 1,000,000 1,000,000
A-1+ Turner County Industrial Development Revenue Coats & Clark Inc.
Series 1984 VRDN MBIA Insured, 4%, 10/1/98............................... 2,200,000 2,200,000
-----------
TOTAL GEORGIA................................................... 6,300,000
-----------
ILLINOIS - 7.5%
A-1 Illinois Educational Facilities Authority University Pooled Finance
Program VRDN FGIC Insured, 5.95%, 12/1/05................................ 4,615,000 4,615,000
A-1+ Illinois Health Facilities Authority Rush-Presbyterian/St. Luke's
Hospital Series 1989-A TECP, 3.85%, 2/9/96............................... 2,100,000 2,100,000
SS&C Pekin Industrial Development Revenue Refunding Bond BOC Group
Series 1992 VRDN, 5.15%, 9/1/12.......................................... 2,600,000 2,600,000
MIG-1 State of Illinois Series 1995 RAN, 4.5, 6/10/96............................. 1,000,000 1,005,150
-----------
TOTAL ILLINOIS................................................... 10,320,150
-----------
IOWA - 1.1%
SP-1+ Iowa School Corporation Warrant Certificates Iowa School Cash
Anticipation Program Capital Guaranty Insured VRDN, 4.75%, 6/28/96...... 1,500,000 1,506,353
-----------
MAINE - 1.5%
SP-1+ State of Maine TAN, 4.5%, 6/28/96........................................... 2,000,000 2,007,077
-----------
MARYLAND - 2.2%
MIG-1 Ann Arundel County Baltimore Electric and Gas TECP, 3.6%, 3/8/96............ 3,000,000 3,000,000
-----------
MASSACHUSETTS - 2.9%
P-1 Massachusetts Water Resources Authority Series 1994 TECP, 3.4%, 3/13/96..... 4,000,000 4,000,000
-----------
MISSOURI - 2.2%
A-1+ Missouri Environmental Improvement and Energy Resource
Authority Union Electric OP, 4%, 6/1/96.................................. 2,000,000 2,000,000
P-1 St. Louis Industrial Development Authority Kirkwood Project Series
1985 VRDN, 5.12%, 12/1/15................................................ 1,000,000 1,000,000
-----------
TOTAL MISSOURI.................................................. 3,000,000
-----------
NEW HAMPSHIRE - 1.4%
A-1+ New Hampshire Business Finance Authority Connecticut Light & Power
VRDN, 5%, 12/1/22........................................................ 2,000,000 2,000,000
-----------
</TABLE>
See notes to financial statements.
9
<PAGE>
MANAGED TAX-FREE FUND (CONTINUED)
<TABLE>
<CAPTION>
CREDIT PRINCIPAL VALUE
RATING* AMOUNT (NOTE 2a)
- ------- --------- ---------
<S> <C> <C> <C>
NEW MEXICO - 0.9%
SS&C Belen Industrial Revenue Refunding Bond United Desiccants Project
VRDN, 5.3%, 4/1/00....................................................... $1,300,000 $ 1,300,000
-----------
NEW YORK - 4.3%
MIG-1 New York City RAN, 4.5%, 4/11/96............................................ 5,000,000 5,008,343
SP-1 New York City RAN, 4.75%, 6/28/96........................................... 1,000,000 1,003,808
-----------
TOTAL NEW YORK.................................................. 6,012,151
-----------
OHIO - 1.5%
VMIG-1 Hamilton Health Systems Franciscan Sisters of the Poor Health Systems
Series A, VRDN, 5.95%, 3/1/17............................................ 800,000 800,000
A-1+ Ohio State Air Quality Development Authority Revenue Cincinnati Gas
& Electric VRDN, 5.9%, 9/1/30............................................ 1,300,000 1,300,000
-----------
TOTAL OHIO..................................................... 2,100,000
-----------
PENNSYLVANIA - 9.6%
VMIG-1 Commonwealth of Pennsylvania System of Higher Education Temple
University Series 1984 VRDN, 5.9%, 10/1/09............................... 600,000 600,000
SP-1+ Commonwealth of Pennsylvania System of Higher Education Temple
University Series 1995, 5%, 5/22/96...................................... 3,000,000 3,007,808
VMIG-1 De Valley Regional Finance Authority Series 1985-A VRDN, 5.2%, 12/1/20..... 1,600,000 1,600,000
SS&C Elk County Industrial Development Authority Stackpole Corporation
Series 1989 VRDN, 4.01%, 3/1/04.......................................... 750,000 750,000
A-1+ Emmaus General Authority Local Government Revenue Bond Pool Program,
Series 1989-G VRDN, 5.05%, 3/1/24........................................ 1,300,000 1,300,000
A-1 Emmaus General Authority Local Government Revenue Bond Pool Program,
Series 1989-G5 VRDN, 5.15%, 3/1/24....................................... 2,000,000 2,000,000
A-1 Emmaus General Authority Local Government Revenue Bond Pool Program,
Series 1989-G6 VRDN, 5.1%, 3/1/24........................................ 1,900,000 1,900,000
A-1+ Montour County Geisinger Health Authority Series B VRDN, 5.9%, 7/1/22....... 100,000 100,000
MIG-1 Philadelphia School District TRAN, 4.5%, 6/28/96............................ 2,000,000 2,005,187
-----------
TOTAL PENNSYLVANIA.............................................. 13,262,995
-----------
TEXAS - 9.4%
A-1+ Austin Utility Systems Revenue TECP, 3.85%, 2/8/96.......................... 3,000,000 3,000,000
P-1 Grapevine Industrial Development Corporation American Airlines
Series B4 VRDN, 6%, 12/1/24.............................................. 600,000 600,000
VMIG-1 Lone Star Airport Improvement Authority Series-B2 VRDN, 6%, 12/1/14......... 1,200,000 1,200,000
SS&C Montgomery County Industrial Development Revenue Medical
Manufacturing Partners Project Series 1987 VRDN, 5.1%, 8/1/17............ 3,640,000 3,640,000
VMIG-1 North Central Texas Health Facilities Development Corp. Presbyterian
Medical Center Series 1985-C VRDN MBIA Insured, 6%, 12/1/15.............. 400,000 400,000
A-1+ Texas Water Development Board State Revolving Fund Series A
VRDN, 6.1%, 3/1/15....................................................... 1,200,000 1,200,000
SP-1+ State of Texas TRAN, 4.75%, 8/30/96......................................... 3,000,000 3,013,563
-----------
TOTAL TEXAS..................................................... 13,053,563
-----------
</TABLE>
See notes to financial statements.
10
<PAGE>
<TABLE>
<CAPTION>
CREDIT PRINCIPAL VALUE
RATING* AMOUNT (NOTE 2a)
- ------- --------- ---------
<S> <C> <C> <C>
UTAH - 4.2%
A-1 Salt Lake City Pooled Hospital Financing TECP, 3.75%, 2/12/96,.............. $1,380,000 $ 1,380,000
A-1 Salt Lake City Pooled Hospital Financing TECP, 3.9%, 2/23/96,............... 1,800,000 1,800,000
VMIG-1 Utah Housing Finance Agency Single-Family Mortgage Series 1993-D
VRDN, 5.05%, 7/1/16...................................................... 2,700,000 2,700,000
------------
TOTAL UTAH...................................................... 5,880,000
------------
VERMONT - 4.6%
SS&C Vermont Industrial Development Authority Vermont Mount Snow
Limited Series 1984 VRDN, 4.01%, 12/1/04................................. 3,835,000 3,835,000
VMIG-1 Vermont Student Assistance Corporation VRDN, 3.75%, 1/1/04.................. 2,600,000 2,600,000
------------
TOTAL VERMONT................................................... 6,435,000
------------
WASHINGTON - 0.4%
VMIG-1 Washington Health Care Facilities Authority Fred Hutchinson Cancer
Research Center Series A VRDN, 6%, 1/1/18................................ 500,000 500,000
------------
WYOMING - 0.7%
A-1 Lincoln County Pollution Control Revenue Pacificorp Project Series B-4
VRDN AMBAC Insured, 6.1%, 11/1/24........................................ 1,000,000 1,000,000
------------
TOTAL INVESTMENTS - 100.0% (COST $138,400,870)**......................................... 138,400,870
------------
OTHER ASSETS AND LIABILITIES - (0.0)%
Receivable for Investments sold.................................................................... 1,400,000
Receivable for capital stock sold.................................................................. 8,651
Interest receivable and other assets............................................................... 1,240,919
Bank overdraft..................................................................................... (966,915)
Dividend payable................................................................................... (423,795)
Payable for investments purchased.................................................................. (1,022,900)
Payable for capital stock redeemed................................................................. (1,276)
Management fee payable (note 4).................................................................... (46,001)
Accrued expenses (note 4).......................................................................... (197,504)
------------
(8,821)
------------
NET ASSETS - 100.0%
Applicable to 138,392,049 shares of $.001 par value Capital Stock outstanding;
1,000,000,0shares authorized (note 7).............................................................. $138,392,049
============
NET ASSET VALUE PER SHARE.......................................................................... $1.00
=====
</TABLE>
** Cost for federal income tax purposes.
- --------------------------------------------------------------------------------
See notes to financial statements.
11
<PAGE>
MANAGED TAX-FREE FUND (CONTINUED)
* CREDIT RATINGS (UNAUDITED) SHOWN ARE EITHER BY MOODY'S INVESTORS SERVICE,
INC., STANDARD & POOR'S CORPORATION OR SCUDDER, STEVENS & CLARK
<TABLE>
<CAPTION>
STANDARD &
MOODY'S POOR'S
<S> <C> <C>
P-1 A-1/A-1+ Commercial paper of the highest quality.
MIG-1 SP-1/SP-1+ Short-term tax-exempt instrument of the best quality
with strong protection.
VMIG-1 Short-term tax-exempt variable rate demand instrument
of the best quality with strong protection.
</TABLE>
<TABLE>
<CAPTION>
ABBREVIATIONS USED IN THE STATEMENT:
<S> <C> <C> <C>
TECP Tax Exempt Commercial Paper VRDN Variable Rate Demand Note
GO General Obligation SS&C These securities are not rated by either Moody's or Standard & Poor's.
Scudder has determined that these securities are of comparable quality to
OP Security with an "optional rated acceptable notes on a cash flow basis and are of appropriate credit for
put" feature; date shown the standards required by the Fund's investment objective.
represents the earliest date
the security may be redeemed
or the interest rate will
be reset if the security is
not redeemed
RAN Revenue Anticipation Note TOB Tender Option Bond is a security with a periodic "put feature"
TAN Tax Anticipation Note TRAN Tax Revenue Anticipation Note
</TABLE>
See notes to financial statements.
12
<PAGE>
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1995
<TABLE>
<CAPTION>
MANAGED MANAGED
GOVERNMENT FEDERAL MANAGED MANAGED
SECURITIES SECURITIES CASH TAX-FREE
FUND FUND FUND FUND
---------- ---------- ------- --------
<S> <C> <C> <C> <C>
INVESTMENT INCOME:
Interest Income .............................. $4,058,977 $587,795 $22,772,894 $5,361,006
---------- -------- ----------- ----------
EXPENSES (note 2c):
Management fee (note 4) ...................... 274,626 43,217 1,519,391 530,696
Shareholder services (notes 4 and 5) ......... 159,248 31,407 677,169 296,831
Directors' fees and expenses (note 4) ........ 13,785 8,761 22,079 21,062
Custodian and accounting fees (note 4) ....... 52,809 34,818 104,318 88,778
Professional services ........................ 51,367 13,853 150,402 71,952
Reports to shareholders ...................... 6,113 889 33,463 11,151
Amortization of organization expenses
(Note 2e) .................................. -- 2,379 -- --
Registration fees ............................ 15,573 10,898 29,390 15,576
Miscellaneous ................................ 15,836 8,631 28,069 11,736
---------- -------- ----------- ----------
Total expenses before reductions ............. 589,357 154,853 2,564,281 1,047,782
Expense reductions (note 4) .................. (211,734) (74,290) (474,280) --
---------- -------- ----------- ----------
Expenses, net ............................. 377,623 80,563 2,090,001 1,047,782
---------- -------- ----------- ----------
NET INVESTMENT INCOME AND INCREASE IN NET
ASSETS FROM OPERATIONS .................... $3,681,354 $507,232 $20,682,893 $4,313,224
========== ======== =========== ==========
</TABLE>
See notes to financial statements.
13
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE YEARS ENDED DECEMBER 31,
<TABLE>
<CAPTION>
MANAGED GOVERNMENT MANAGED FEDERAL
SECURITIES FUND SECURITIES FUND
------------------------------------- ----------------------------
1995 1994 1995 1994
------------- ------------- ------------ ------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income and increase
in net assets from operations ........... $ 3,681,354 $ 2,722,387 $ 507,232 $ 415,899
Dividends (notes 2b and 2d) ............... (3,681,354) (2,722,387) (507,232) (415,899)
------------- ------------- ------------ ------------
-- -- -- --
------------- ------------- ------------ ------------
CAPITAL STOCK TRANSACTIONS (note 7):
Proceeds from sale of shares .............. 229,035,361 269,803,425 15,962,430 23,109,819
Net asset value of shares issued in
reinvestment of dividends ............... 2,961,712 2,043,089 443,321 332,762
------------- ------------- ------------ ------------
231,997,073 271,846,514 16,405,751 23,442,581
Cost of shares redeemed ................... (250,578,326) (295,383,364) (20,579,055) (23,414,968)
------------- ------------- ------------ ------------
Increase (decrease) in net assets
from capital stock transactions ......... (18,581,253) (23,536,850) (4,173,304) 27,613
------------- ------------- ------------ ------------
Total increase (decrease) in net assets ..... (18,581,253) (23,536,850) (4,173,304) 27,613
NET ASSETS:
Beginning of period ......................... 68,556,977 92,093,827 12,805,227 12,777,614
------------- ------------- ------------ ------------
End of period ............................... $ 49,975,724 $ 68,556,977 $ 8,631,923 $ 12,805,227
============= ============= ============ ============
</TABLE>
See notes to financial statements.
14
<PAGE>
MANAGED CASH FUND MANAGED TAX-FREE FUND
- ----------------------------------- -------------------------------
1995 1994 1995 1994
- ---------------- ---------------- -------------- --------------
$ 20,682,893 $ 13,496,739 $ 4,313,224 $ 2,812,451
(20,682,893) (13,496,739) (4,313,224) (2,812,451)
- --------------- --------------- ------------- -------------
-- -- -- --
- --------------- --------------- ------------- -------------
2,168,020,988 1,838,028,319 561,389,929 586,552,129
11,385,987 6,568,961 2,171,918 1,385,261
- --------------- --------------- ------------- -------------
2,179,406,975 1,844,597,280 563,561,847 587,937,390
(2,174,994,810) (1,801,334,141) (549,766,530) (570,047,516)
- --------------- --------------- ------------- -------------
4,412,165 43,263,139 13,795,317 17,889,874
- --------------- --------------- ------------- -------------
4,412,165 43,263,139 13,795,317 17,889,874
367,106,930 323,843,791 124,596,732 106,706,858
- --------------- --------------- ------------- -------------
$ 371,519,095 $ 367,106,930 $ 138,392,049 $ 124,596,732
=============== =============== ============= =============
See notes to financial statements.
15
<PAGE>
FINANCIAL HIGHLIGHTS
THE FOLLOWING TABLE INCLUDES SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT
EACH PERIOD AND OTHER PERFORMANCE INFORMATION DERIVED FROM THE FINANCIAL
STATEMENTS.
<TABLE>
<CAPTION>
RATIO OF RATIO OF NET
NET ASSET NET ASSET OPERATING INVESTMENT NET ASSETS
VALUE, AT NET VALUE, AT EXPENSES INCOME END OF
BEGINNING INVESTMENT DIVIDENDS END TOTAL TO AVERAGE TO AVERAGE PERIOD
PERIOD OF PERIOD INCOME PAID OF PERIOD RETURN NET ASSETS (a) NET ASSETS (MILLIONS)
- ------------------------ --------- ---------- --------- --------- ------ -------------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
MANAGED GOVERNMENT
SECURITIES FUND
Year ended 12/31/95 .. $1.00 $.054 $(.054) $1.00 5.49%* 0.55% 5.36% $ 50
Year ended 12/31/94 .. 1.00 .037 (.037) 1.00 3.75* 0.55 3.61 69
Year ended 12/31/93 .. 1.00 .026 (.026) 1.00 2.68* 0.55 2.65 92
Year ended 12/31/92 .. 1.00 .035 (.035) 1.00 3.51* 0.55 3.39 151
Year ended 12/31/91 .. 1.00 .056 (.056) 1.00 5.65* 0.55 5.54 87
MANAGED FEDERAL
SECURITIES FUND
Year ended 12/31/95 .. 1.00 .047 (.047) 1.00 4.80* 0.75 4.69 9
Year ended 12/31/94 .. 1.00 .032 (.032) 1.00 3.24* 0.69 3.19 13
Year ended 12/31/93 .. 1.00 .024 (.024) 1.00 2.45* 0.52 2.43 13
Year ended 12/31/92 .. 1.00 .030 (.030) 1.00 3.02* 0.53 3.00 12
7/17/91(c) to 12/31/91 1.00 .021 (.021) 1.00 4.80(b)* 0.52(b) 4.67(b) 14
MANAGED CASH FUND
Year ended 12/31/95 .. 1.00 .054 (.054) 1.00 5.57* 0.55 5.45 372
Year ended 12/31/94 .. 1.00 .038 (.038) 1.00 3.86* 0.55 3.84 367
Year ended 12/31/93 .. 1.00 .028 (.028) 1.00 2.81* 0.55 2.78 324
Year ended 12/31/92 .. 1.00 .037 (.037) 1.00 3.74* 0.55 3.76 305
Year ended 12/31/91 .. 1.00 .059 (.059) 1.00 6.07* 0.55 5.93 347
MANAGED TAX-FREE FUND
Year ended 12/31/95 .. 1.00 .032 (.032) 1.00 3.30 0.79 3.25 138
Year ended 12/31/94 .. 1.00 .023 (.023) 1.00 2.29 0.77 2.26 125
Year ended 12/31/93 .. 1.00 .018 (.018) 1.00 1.85 0.78 1.83 107
Year ended 12/31/92 .. 1.00 .025 (.025) 1.00 2.56 0.77 2.54 91
Year ended 12/31/91 .. 1.00 .042 (.042) 1.00 4.20 0.75 4.14 107
</TABLE>
(a) The annualized operating expense ratio including expenses reimbursed,
management fee and other expenses not imposed would have been, for the
Managed Government Securities Fund, Managed Federal Securities Fund and
Managed Cash Fund, 0.86%, 1.43% and 0.68%, for the year ended December 31,
1995, respectively; 0.84%, 1.22% and 0.68%, for the year ended December
31, 1994, respectively; 0.77%, 1.14% and 0.66%, for the year ended
December 31, 1993, respectively; 0.76%, 1.07% and 0.64%, for the year
ended December 31, 1992, respectively; 0.80%, 0.92% and 0.64%, for the
year ended December 31, 1991.
(b) Annualized
(c) Date commenced operations.
* Total returns are higher, for the periods indicated, due to the
maintenance of the Fund's expenses.
16
<PAGE>
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION
Scudder Fund, Inc. (the "Company") is an open-end diversified management
investment company which currently includes four active money market investment
portfolios: Managed Government Securities Fund, Managed Federal Securities Fund,
Managed Cash Fund, and Managed Tax-Free Fund (collectively, the "Funds").
2. SIGNIFICANT ACCOUNTING POLICIES
Significant accounting policies followed by the Company are:
(a) Security Valuation-Each of the Funds values its investments using
the amortized cost method, which involves initially valuing an investment at its
cost and thereafter assuming a constant amortization to maturity of any premium
or discount. This method results in a value approximating market.
(b) Federal Income Taxes-The Company's policy is to qualify each Fund as
a regulated investment company under Subchapter M of the Internal Revenue Code
and to distribute all taxable and tax-exempt income, including any realized net
capital gains, to shareholders. Therefore, no Federal income tax provision is
required.
(c) Allocation of Expenses-Expenses not directly chargeable to a
specific Fund are allocated primarily on the basis of relative net assets of the
Company.
(d) Dividends-Dividends from net investment income are declared each
business day to shareholders of record that day for payment on the first
business day of the following month.
(e) Organization Costs-Costs incurred by the Fund in connection with its
organization and initial registration of shares have been deferred and are being
amortized on a straight-line basis over a five-year period.
(f) Other-Investment transactions are recorded on trade dates. Interest
income, including the accretion or amortization of discount or premium, is
recorded on the accrual basis. Discounts or premiums on securities purchased are
accreted or amortized, respectively, on a straight line basis over the life of
the respective securities. Distributions to shareholders are recorded on the
ex-dividend dates.
The Managed Cash Fund must have at least 25% of its investment portfolio
invested in bankers' acceptances, certificates of deposits, commercial paper,
fixed time deposits or other obligations of domestic and foreign banks.
3. REPURCHASE AGREEMENTS
It is the Company's policy to obtain possession, through its custodian,
of the securities underlying each repurchase agreement to which it is a party,
either through physical delivery or book entry transfer in the Federal Reserve
System or Participants Trust Company. Payment by the Company in respect of a
repurchase agreement is authorized only when proper delivery of the underlying
securities is made to the Company's custodian. The Company's investment manager
values such underlying securities each business day using quotations obtained
from a reputable, independent source. If the Company's investment manager
determines that the value of such underlying securities (including accrued
interest thereon) does not at least equal the value of each repurchase agreement
(including accrued interest thereon) to which such securities are subject, it
will ask for additional securities to be delivered to the Company's custodian.
In connection with each repurchase agreement transaction, if the seller defaults
and the value of the collateral declines or if the seller enters an insolvency
proceeding, realization of the collateral by the Company may be delayed or
limited.
4. MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES
The Company retains Scudder, Stevens & Clark, Inc. ("Scudder") as
investment manager for the Funds, pursuant to investment advisory agreements
between Scudder and the Company on behalf of each such Fund, for a management
fee payable each month, based upon the average daily value of each Fund's net
assets, at annual rates of 0.40% on the first $1.5 billion and 0.35% on any
amount in excess thereof. Scudder has agreed not to impose a portion of its
17
<PAGE>
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
management fee until October 31, 1996, to the extent necessary so that expenses
of each of the Managed Government Securities Fund, Managed Federal Securities
Fund, and the Managed Cash Fund do not exceed 0.55%, 0.75%, and 0.55%,
respectively, of the average daily net assets of each Fund. Further, due to the
limitation of such Agreement, the Adviser's reimbursement payable for the year
ended December 31, 1995 amounted to $3,623 for the Managed Federal Securities
Fund.
For the year ended December 31, 1995, Scudder did not impose fees
amounting to $211,734, $43,217 and $474,280 on the Managed Government Securities
Fund, the Managed Federal Securities Fund and the Managed Cash Fund,
respectively.
Under certain state regulations, if the total expenses of any of the
Funds, exclusive of taxes, interest, and extraordinary expenses exceed certain
limitations, the Company's investment adviser is required to reimburse the Fund
for such excess up to the amount of management fees.
Scudder Service Corporation ("SSC"), a subsidiary of Scudder, is the
Company's shareholder service, transfer and dividend disbursing agent. For the
year ended December 31, 1995, the amount charged to the Company by SSC
aggregated $22,056 for the Managed Government Securities Fund, $7,892 for the
Managed Federal Securities Fund, $97,011 for the Managed Cash Fund, and $28,213
for the Managed Tax-Free Fund, of which $2,037, $2,037, $5,663, and $2,037
respectively, remain unpaid at December 31, 1995.
Scudder Fund Accounting Corporation ("SFAC"), a subsidiary of Scudder,
is responsible for determining the daily net asset value per share and
maintaining the portfolio and general accounting records for the Funds. For the
year ended December 31, 1995, the amount charged to the Funds by SFAC aggregated
$30,000 for the Managed Government Securities Fund, $2,550 for the Managed
Federal Securities Fund, $49,471 for the Managed Cash Fund, and $36,144 for the
Managed Tax-Free Fund, of which $2,500, $175, $4,027, and $3,164, respectively,
remain unpaid at December 31, 1995. For the year ended December 31, 1995 for
the Federal Portfolio, SFAC did not impose fees amounting to $27,450.
The Company has a compensation arrangement under which payment of
directors' fees may be deferred. Interest is accrued (based on the rate of
return earned on the 90 day Treasury Bill as determined at the beginning of each
calendar quarter) on the deferred balances and is included in "Directors' fees
and expenses." The accumulated balance of deferred directors' fees and interest
thereon relating to the Funds constituting the Company aggregated $444,665, an
applicable portion of which is included in accrued expenses of each such Fund.
5. SHAREHOLDER SERVICES
Each of the Funds has special arrangements with certain banks,
institutions and other persons under which they receive compensation from the
Funds and Scudder for performing shareholder servicing functions for their
customers who own shares in the Funds from time to time. For the year ended
December 31, 1995, payments by the Funds pursuant to these arrangements
aggregated $131,765 for the Managed Government Securities Fund, $23,678 for the
Managed Federal Securities Fund, $552,643 for the Managed Cash Fund and $263,795
for the Managed Tax-Free Fund.
6. SHAREHOLDER SERVICE, ADMINISTRATION AND DISTRIBUTION PLAN
The Company has a Shareholder Service, Administration and Distribution
Plan adopted pursuant to Rule 12b-1 under the Investment Company Act of 1940
under which participating organizations which enter into agreements with the
Company and Scudder may receive a fee of up to 0.25% on an annual basis from
each fund of the Company and Scudder. Such fee is calculated on the average
daily net assets of the Company for which such participating organizations are
responsible. No payments have been made by the Company for shareholder service,
administration and distribution assistance under this plan other than as
indicated in Note 5 above.
18
<PAGE>
7. CAPITAL STOCK
At December 31, 1995, the Company had 10,000,000,000 shares of $.001 par
value Capital Stock authorized, of which 3,000,000,000 shares each have been
designated for the Managed Government Securities Fund and Managed Cash Fund and
1,000,000,000 shares each have been designated for the Managed Federal
Securities Fund and Managed Tax-Free Fund. Net paid in capital in excess of par
value was $49,925,748, for the Managed Government Securities Fund, $8,623,291
for the Managed Federal Securities Fund, $371,147,576 for the Managed Cash Fund
and $138,253,657 for the Managed Tax-Free Fund.
19
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors and Shareholders of
SCUDDER FUND, INC.
In our opinion, the accompanying statements of net assets 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
the Managed Government Securities Fund, Managed Federal Securities Fund, Managed
Cash Fund, and Managed Tax-Free Fund (each a separate portfolio of Scudder Fund,
Inc., hereafter referred to as the "Fund") at December 31, 1995, the results of
each of their operations for the year then ended, the changes in each of their
net assets for each of the two years in the period then ended and the financial
highlights for each of the five years in the period then ended (except for the
Managed Federal Securities Fund which commenced operations on July 17, 1991), 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, 1995 by
correspondence with the custodian and brokers, provide a reasonable basis for
the opinion expressed above.
PRICE WATERHOUSE LLP
1177 Avenue of the Americas
New York, New York
February 12, 1996
FEDERAL TAX STATUS OF 1995 DIVIDENDS
The total amount of dividends declared in 1995 by each of the Federal
Portfolio, Government Portfolio and Cash Portfolio of Scudder Institutional
Fund, Inc. is taxable as ordinary dividend income for Federal income tax
purposes. None of this amount qualifies for the dividends received deduction
available to corporations.
All of the dividends from the Tax-Free Portfolio declared in 1995 are
exempt from Federal income tax. However, in accordance with the Internal Revenue
Code, you are required to report them on your 1995 Federal income tax return.
Although dividend income from the Tax-Free Portfolio is exempt from
Federal taxation, it may not be exempt from state or local taxation. You should
consult your tax advisor as to the state and local tax status of the dividends
you received.
20
<PAGE>
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21
<PAGE>
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22
<PAGE>
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23
<PAGE>
Managed Government Securities Fund
Managed Federal Securities Fund
Managed Cash Fund
Managed Tax-Free Fund
345 Park Avenue, New York, New York 10154
(800) 854-8525
Investment Manager
Scudder, Stevens & Clark, Inc.
345 Park Avenue
New York, New York 10154
Distributor
Scudder Investor Services, Inc.
Two International Place
Boston, Massachusetts 02110
Custodian
State Street Bank and Trust Company
225 Franklin Street
Boston, Massachusetts 02110
Fund Accounting Agent
Scudder Fund Accounting Corporation
Two International Place
Boston, Massachusetts 02110
Transfer Agent and
Dividend Disbursing Agent
Scudder Service Corporation
P.O. Box 9242
Boston, Massachusetts 02205
Legal Counsel
Sullivan & Cromwell
New York, New York
--------------
The Funds are neither insured nor guaranteed by the U.S. Government. Each Fund
intends to maintain a net asset value per share of $1.00 but there is no
assurance that it will be able to do so.
This report is for the information of the shareholders. Its use in connection
with any offering of the Company's shares is authorized only in case of a
concurrent or prior delivery of the Company's current prospectus.
MANAGED GOVERNMENT SECURITIES FUND
MANAGED FEDERAL SECURITIES FUND
MANAGED CASH FUND
MANAGED TAX-FREE FUND
ANNUAL REPORT
DECEMBER 31, 1995
