Scudder
Institutional Shares
Scudder Money Market Series
Scudder Tax Free Money Market Series
Scudder Government Money Market Series
345 Park Avenue, New York, New York 10154
(800) 854-8525
Investment Manager
Scudder Kemper Investments, 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
Dechert Price & Rhoads
Boston, Massachusetts 02109
-----------------
Scudder Institutional Shares are not insured or guaranteed by the U.S.
Government. The Fund seeks to maintain a constant net asset value of $1.00
per share, but there can be no assurance that the stable net asset value
will be maintained.
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.
Scudder
Institutional Shares
Scudder Money
Market Series
Scudder Tax Free Money
Market Series
Scudder Government
Money Market Series
Semiannual Report
June 30, 1998
<PAGE>
<TABLE>
<CAPTION>
Board of Directors
<S> <C>
DANIEL PIERCE*^(1) President; Managing Director, Scudder Kemper Investments, Inc.
DR. ROSITA P. CHANG^(2)^(3) Professor of Finance, University of Rhode Island
EDGAR R. FIEDLER^(1)^(2)^(3) Senior Fellow and Economic Counsellor, The Conference Board, Inc.
PETER B. FREEMAN^(2)^(3) Corporate Director and Trustee
DR. J.D. HAMMOND^(2)^(3) Dean, Smeal College of Business Administration
RICHARD M. HUNT^(2)^(3) University Marshal and Senior Lecturer, Harvard University
</TABLE>
^(1)Member of Executive Committee
^(2)Member of Nominating Committee
^(3)Member of Audit Committee
- --------------------------------------------------------------------------------
Officers
JERARD K. HARTMAN* Vice President
KATHRYN L. QUIRK* Vice President
FRANK J. RACHWALSKI, JR.* Vice President
DAVID B. WINES* Vice President
THOMAS W. JOSEPH* Vice President and Assistant Secretary
THOMAS F. McDONOUGH* Vice President, Secretary and Treasurer
JOHN R. HEBBLE* Assistant Treasurer
CAROLINE PEARSON* Assistant Secretary
*Scudder Kemper Investments, Inc.
2
<PAGE>
Dear Shareholder:
Scudder Institutional Shares is a class of shares in three different money
market mutual fund portfolios: Scudder Money Market Series, Scudder Government
Money Market Series, and Scudder Tax Free Money Market Series. Each of these
money market portfolios seeks to provide a high level of current income while
preserving capital and maintaining liquidity.
All three Portfolios seek to maintain a net asset value of $1.00, and have
done so since their inception. (There is no guarantee, of course, that each will
maintain stable net asset values.)
Please see the following pages for financial statements as of June 30,
1998, as well as a list of each Portfolio's investments.
If you have questions concerning any series of Scudder Institutional
Shares, please call 1-800-854-8525 from any continental state.
/s/Daniel Pierce
Daniel Pierce
President
3
<PAGE>
Scudder Institutional Shares/Money Market Series
Investment Portfolio
June 30, 1998 (Unaudited)
<TABLE>
<CAPTION>
Principal Value ($)
Amount ($) (Note A)
- ------------------------------------------------------------------------------------------------------------------------------
Commercial Paper 60.1%
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
American Honda Finance Corp., Floating Rate Note, 5.632%, 5/14/1999* .................... 15,500,000 15,498,654
American Honda Finance Corp., Floating Rate Note, 5.668%, 5/26/1999* .................... 20,000,000 19,998,197
Apex Funding Corp., 7/31/1998 ........................................................... 40,000,000 39,812,333
Banner Receivables Corp., 7/9/1998 ...................................................... 15,831,000 15,811,123
Banner Receivables Corp., 7/22/1998 ..................................................... 10,000,000 9,967,217
Broadway Capital Corp., 8/17/1998 ....................................................... 38,942,000 38,654,749
Broadway Capital Corp., 8/24/1998 ....................................................... 16,850,000 16,704,922
Countrywide Home Loans Corp., 7/16/1998 ................................................. 20,000,000 19,953,750
CSW Credit Inc., 7/14/1998 .............................................................. 21,975,000 21,931,197
Deutsche Bank Finance Corp., 7/10/1998 .................................................. 20,000,000 19,972,400
Dresdnerus Finance Corp., 7/2/1998 ...................................................... 50,000,000 49,992,333
Frontier Corp., 7/2/1998 ................................................................ 40,000,000 39,993,811
Gotham Funding Corp., 7/21/1998 ......................................................... 30,000,000 29,906,333
Gotham Funding Corp., 7/24/1998 ......................................................... 10,000,000 9,963,519
GTE Corp., 5.53%, 7/10/1998 ............................................................. 17,000,000 16,976,455
GTE Corp., 7/13/1998 .................................................................... 28,000,000 27,947,827
Lehman Brothers Holdings, 7/15/1998 ..................................................... 20,000,000 19,956,911
Madison Funding Corp., 7/13/1998 ........................................................ 18,000,000 17,966,400
Madison Funding Corp., 7/15/1998 ........................................................ 10,000,000 9,978,144
Merrill Lynch & Co., 8/26/1998 .......................................................... 10,000,000 9,914,133
Morgan Stanley, 5.616%, 11/13/1998 ...................................................... 25,000,000 25,000,000
Nomura Holding America Corp., 7/8/1998 .................................................. 25,000,000 24,972,340
Nomura Holding America Corp., 7/17/1998 ................................................. 15,000,000 14,962,400
Prudential Funding Corp., 7/10/1998 ..................................................... 40,000,000 39,946,000
Ranger Funding Corp., 7/7/1998 .......................................................... 15,000,000 14,985,875
Salomon Smith Barney Holdings Corp., 7/6/1998 ........................................... 35,000,000 34,973,118
Salomon Smith Barney Holdings Corp., 7/17/1998 .......................................... 14,000,000 13,965,778
Sanwa Business Credit Corp., 7/9/1998 ................................................... 15,000,000 14,981,267
Sanwa Business Credit Corp., 7/9/1998 ................................................... 15,000,000 14,981,233
Sanwa Business Credit Corp., 7/13/1998 .................................................. 20,000,000 19,962,667
</TABLE>
The accompanying notes are an integral part of the financial statements.
4
<PAGE>
Scudder Institutional Shares/Money Market Series
<TABLE>
<CAPTION>
Principal Value ($)
Amount ($) (Note A)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Thunder Bay Funding Corp., 7/13/1998 .................................................... 15,000,000 14,972,200
Thunder Bay Funding Corp., 7/16/1998 .................................................... 25,000,000 24,941,667
Windmill Funding Corp., 7/17/1998 ....................................................... 20,000,000 19,950,400
- ------------------------------------------------------------------------------------------------------------------------------
Total Commercial Paper (Cost $729,495,353) 729,495,353
- ------------------------------------------------------------------------------------------------------------------------------
Certificates Of Deposit 22.3%
- ------------------------------------------------------------------------------------------------------------------------------
Bank of America, 5.95%, 10/22/1998 ...................................................... 10,000,000 9,998,521
Bank of Nova Scotia, 5.793%, 10/1/1998 .................................................. 10,000,000 9,998,131
Bank of Nova Scotia, 5.715%, 10/30/1998 ................................................. 10,000,000 9,996,548
Bankers Trust Co., 5.97%, 8/28/1998 ..................................................... 10,000,000 9,999,620
Bankers Trust Co., Floating Rate Note, 5.57%, 5/14/1999* ................................ 15,000,000 14,991,230
Banque National de Paris YCD, 5.89%, 9/10/1998 .......................................... 15,000,000 14,999,870
Banque National de Paris, 5.9%, 10/21/1998 .............................................. 15,000,000 15,003,705
FCC National Bank, Bank Note, 5.55%, 7/20/1998 .......................................... 30,000,000 30,000,000
FCC National Bank, Floating Coupon Rate, 5.55%, 6/1/1999* ............................... 15,000,000 14,990,545
First National Bank of Maryland, 5.95%, 10/22/1998 ...................................... 14,850,000 14,852,916
Huntington National Bank, 5.625%, 1/12/1999 ............................................. 15,000,000 15,004,470
IBM Credit Corp., 5.4%, 1/27/1999 ....................................................... 30,000,000 29,983,775
Lasalle National Bank, 5.91%, 8/12/1998 ................................................. 10,000,000 10,000,220
Morgan Guaranty Trust Co., 5.87%, 8/6/1998 .............................................. 20,000,000 19,999,775
Societe Generale YCD, 5.91%, 9/4/1998 ................................................... 10,000,000 9,999,576
Svenska Handelsbanken, Bank Note, 5.536%, 6/2/1999* ..................................... 40,000,000 39,974,612
- ------------------------------------------------------------------------------------------------------------------------------
Total Certificates Of Deposit (Cost $269,793,514) 269,793,514
- ------------------------------------------------------------------------------------------------------------------------------
Short-Term Notes 17.6%
- ------------------------------------------------------------------------------------------------------------------------------
Bankers Trust Co., Floating Rate Note, 5.61%, 3/19/1999* ................................ 16,000,000 15,995,510
Bankers Trust Co., Floating Rate Note, 5.6%, 4/30/1999* ................................. 15,000,000 14,994,947
Chrysler Financial Corp., Medium Term Note, 6.24%, 11/2/1998 ............................ 10,000,000 10,019,710
Federal National Mortgage Association, 5.35%, Floating Rate Note, 12/14/1998* ........... 15,000,000 14,991,232
Goldman Sachs & Co., Floating Rate, 5.69%, 3/26/1999* ................................... 15,000,000 15,000,000
Household Finance Corp., Floating Rate Note, 5.637%, 3/9/1999* .......................... 25,000,000 25,000,000
IBM Credit Corp., Medium Term Note, 6.12%, 12/15/1998 ................................... 10,000,000 10,010,947
Lehman Brothers Holdings, Medium Term Note, 5.71%, 3/22/1999 ............................ 25,000,000 25,000,000
Merrill Lynch & Co., Medium Term Note, 5.61%, 4/14/1999 ................................. 30,000,000 30,000,000
</TABLE>
The accompanying notes are an integral part of the financial statements.
5
<PAGE>
Scudder Institutional Shares/Money Market Series
<TABLE>
<CAPTION>
Principal Value ($)
Amount ($) (Note A)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
MMR Funding I, Variable Weekly, 5.63%, 9/1/2010* ........................................ 5,500,000 5,500,000
Sigma Finance Corp., Floating Rate Note, 5.63%, 4/27/1999* .............................. 25,000,000 25,000,000
Student Loan Marketing Assoc. YCD, 5.32%, 11/10/1998* ................................... 22,400,000 22,399,236
- ------------------------------------------------------------------------------------------------------------------------------
Total Short-Term Notes (Cost $213,911,582) 213,911,582
- ------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------
Total Investment Portfolio -- 100.0% (Cost $1,213,200,449) (a) 1,213,200,449
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(a) Cost for federal income tax purposes is $1,213,200,449.
* Floating rate security; date shown is next interest rate change.
The accompanying notes are an integral part of the financial statements.
6
<PAGE>
Scudder Institutional Shares/Tax Free Money Market Series
Investment Portfolio
June 30, 1998 (Unaudited)
<TABLE>
<CAPTION>
Principal Credit Value ($)
Amount ($) Rating(b) (Note A)
- ------------------------------------------------------------------------------------------------------------------------------
Short-Term Municipal Investments 100.0%
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Alaska
Alaska Housing Finance Corp., General Mortgage Revenue, Series 1991-A, Weekly
Demand Note, 3.55%, 6/1/2026 ................................................. 3,000,000 VMIG1 3,000,000
Arizona
Pima County, AZ, Industrial Development Authority, Series 1985, SFE
Technologies, Weekly Demand Note, 4%, 12/1/2005 .............................. 1,500,000 VMIG1 1,500,000
Scottsdale, AZ, Industrial Development Authority, Hospital Revenue, Scottsdale
Hospital, Weekly Demand Note, 3.4%, 9/1/2022 (c) ............................. 3,000,000 VMIG1 3,000,000
California
Corona Multi-Family Housing Revenue, Weekly Demand Note, 3.65%, 2/1/2005 ....... 1,900,000 A1 1,900,000
Kern County, CA, Board of Education, Tax and Revenue Anticipation Notes,
Series 1998, 4.5%, 7/7/1998 .................................................. 2,000,000 SP1+ 2,000,195
Riverside, CA, Countrywood Apartments, Multi-Family Revenue, Series 1985 D,
Weekly Demand Bond, 3.65%, 11/1/2030 ......................................... 1,500,000 A1 1,500,000
San Marcos, CA, Redevelopment Agency, Multi-Family Rental Housing Agency,
Weekly Demand Bonds, 3.65%, 6/1/2005 ......................................... 1,900,000 A1 1,900,000
Colorado
Cherry Creek, CO, Weekly Demand Note, 3.5%, 6/1/2006 ........................... 5,000,000 A1+ 5,000,000
District of Columbia
District of Columbia, General Obligation, Refunding Bonds, Series A1, Daily
Demand Note, 4%, 10/1/2007 ................................................... 4,500,000 VMIG1 4,500,000
District of Columbia, Tax and Revenue Anticipation Note, 4.5%, 9/30/1998 ....... 1,500,000 VMIG1 1,502,265
Florida
Alachua County, FL, Health Facility Authority, Shands Teaching Hospital,
Series B, Weekly Demand Note, 3.5%, 12/1/2026 (c) ............................ 2,700,000 VMIG1 2,700,000
Dade County, FL, Health Facility Authority, Miami Children's Hospital, Weekly
Demand Note, 3.4%, 9/1/2025 (c) .............................................. 3,000,000 AAA 3,000,000
Dade County, FL, Water and Sewer System Revenue, Series 1994, Weekly Demand
Note, 3.4%, 10/5/2022 (c) .................................................... 5,500,000 VMIG1 5,500,000
Gainsville, FL, Utilities Systems, TECP, 3.7%, 9/15/1998 ....................... 3,600,000 P1 3,600,000
Jacksonville, FL, Florida Power & Light, Series 1994, TECP, 3.6%, 10/13/1998 ... 2,000,000 VMIG1 2,000,000
Sarasota County, FL, Public Hospital District, Sarasota Memorial Hospital,
Series 1985B, TECP, 3.8%, 8/14/1998 .......................................... 1,000,000 MIG1 1,000,000
</TABLE>
The accompanying notes are an integral part of the financial statements.
7
<PAGE>
Scudder Institutional Shares/Tax Free Money Market Series
<TABLE>
<CAPTION>
Principal Credit Value ($)
Amount ($) Rating(b) (Note A)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Sarasota County, FL, Sarasota Memorial Hospital, Series 1985C, TECP, 3.75%,
9/14/1998 .................................................................... 4,100,000 MIG1 4,100,000
University of Northern Florida, Capital Improvement Revenue, VRDN, 3.55%,
11/1/2024 .................................................................... 2,000,000 VMIG1 2,000,000
Georgia
DeKalb Private Hospital Authority, Egleston Children's Hospital at Emory
University, 1994 Series B, Weekly Demand Note, 3.6%, 3/1/2024 ................ 1,400,000 VMIG1 1,400,000
Fulton County, GA, Development Authority Pollution Control, Loan Agreement from
GM Corp., Variable Weekly, 3.35%, 12/1/2001 .................................. 1,580,000 VMIG1 1,580,000
Gainsville Redevelopment Authority, 3.55%, 1/1/2023 ............................ 2,000,000 AA2 2,000,000
Turner County, GA, Industrial Development Revenue, Coats & Clark Inc., Series
1984, VRDN, 3.95%, 10/1/1998 (c) ............................................. 800,000 A1+ 800,000
Illinois
Chicago, IL, O'Hare International Airport, American Airlines, 1983 Series B,
Daily Demand Note, 4%, 12/1/2017 ............................................. 5,800,000 P1 5,800,000
Chicago-O'Hare International Airport, IL, General Airport Second Lien, Series A,
Weekly Demand Note, 3.5%, 1/1/2015 ........................................... 1,500,000 VMIG1 1,500,000
Cook County, IL, General Obligation, Weekly Demand Note, 3.5%, 12/1/2001 ....... 3,000,000 VMIG1 3,000,000
Illinois Educational Facilities Authority, University Pooled Finance Program,
Weekly Demand Note, 3.5%, 12/1/2005 (c) ...................................... 1,770,000 VMIG1 1,770,000
Indiana
Mt Vernon, IN, Pollution Control & Solid Waste Disposal, General Electric Co.,
TECP, Series 1989A, 3.8%, 8/14/1998 .......................................... 2,100,000 P1 2,100,000
Kansas
Burlington, KS, National Rural Utilities Cooperative Finance Corp., Series 1985
C-1, TECP, 3.65%, 8/13/1998 .................................................. 4,000,000 P1 4,000,000
Kentucky
Danville, KY, Multi-City Lease Revenue, TECP, 3.7%, 10/14/1998 ................. 3,000,000 MIG1 3,000,000
Mayfield, KY, Multi-City Lease Revenue, Kentucky League of Cities Funding Trust,
Weekly Demand Note, Series 1996, 3.7%, 7/1/2026 .............................. 2,000,000 A1 2,000,000
Louisiana
Louisiana Public Facilities Authority, Hospital Revenue, Willis Knighton Medical
Center, Weekly Demand Note, 3.5%, 9/1/2025 (c) ............................... 3,000,000 AAA 3,000,000
Louisiana Public Facility Authority, Sisters of Charity Health Care System,
TECP, Series 1997D, 3.65%, 8/11/1998 ......................................... 3,000,000 MIG1 3,000,000
</TABLE>
The accompanying notes are an integral part of the financial statements.
8
<PAGE>
Scudder Institutional Shares/Tax Free Money Market Series
<TABLE>
<CAPTION>
Principal Credit Value ($)
Amount ($) Rating(b) (Note A)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Maryland
Anne Arundel County, MD, Baltimore Electric & Gas Company, TECP, 3.6%,
8/13/1998 .................................................................... 3,700,000 MIG1 3,700,000
Massachusetts
Massachusetts Bay Transportation Authority, Series 1997 B, 4.5%, 9/4/1998 ...... 2,000,000 SP1 2,002,158
Michigan
Michigan Strategic Fund, Dow Chemical Co., Pollution Control Revenue, Series
1986, TECP, 3.8%, 8/14/1998 .................................................. 2,000,000 P1 2,000,000
Missouri
Columbia, MO, Special Obligation, Weekly Demand Note, 3.5%, 6/1/2008 ........... 2,700,000 AA2 2,700,000
Independence, MO, Water Utility Revenue Bonds, TECP, Series 1986, 3.75%,
7/23/1998 .................................................................... 2,600,000 VMIG1 2,600,000
St. Louis County, MO, Industrial Development Authority, Kirkwood Project,
Series 1985, Weekly Demand Note, 3.625%, 12/1/2015 ........................... 1,000,000 P1 1,000,000
Nebraska
Nebraska Public Power District, TECP, 3.5%, 7/20/1998 .......................... 2,060,000 P1 2,060,000
Nebraska Public Power District, TECP, 3.7%, 9/14/1998 .......................... 4,000,000 P1 4,000,000
New Mexico
Albuquerque, NM, Gross Receipts/Lodgers Tax, Series 1991, Weekly Demand Note,
3.5%, 7/1/2022 ............................................................... 2,000,000 P1 2,000,000
New York
Long Island, NY, Power Authority, TECP, 3.7%, 9/9/1998 ......................... 3,000,000 VMIG1 3,000,000
Long Island, NY, Power Authority, TECP, Series 4, 3.75%, 7/22/1998 ............. 4,000,000 VMIG1 4,000,000
North Carolina
North Carolina Medical Care Common Hospital Revenues, Series 1985, Weekly
Demand Note, 3.25%, 12/1/2025 (c) ............................................ 8,100,000 VMIG1 8,100,000
Ohio
Ohio Air Quality Development Authority, Cleveland Electric Co., TECP,
Series 1988B, 3.65%, 8/12/1998 (c) ........................................... 2,000,000 MIG1 2,000,000
Ohio State University Revenue, General Receipts Bonds, Weekly Variable Rate
Demand Bond, Series 1986 B, 3.45%, 12/1/2006 ................................. 2,900,000 VMIG1 2,900,000
Oregon
Oregon General Obligation, Series 1973-G, Weekly Demand Note, 3.5%,
12/1/2018 .................................................................... 1,900,000 VMIG1 1,900,000
</TABLE>
The accompanying notes are an integral part of the financial statements.
9
<PAGE>
Scudder Institutional Shares/Tax Free Money Market Series
<TABLE>
<CAPTION>
Principal Credit Value ($)
Amount ($) Rating(b) (Note A)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Pennsylvania
Delaware Valley Finance Authority, Weekly Demand Note, 3.45%, 12/1/2020 ........ 1,600,000 VMIG1 1,600,000
Elk County, PA, Industrial Development Authority, Series 1989, VRDN, 4.33%,
3/1/2004 ..................................................................... 1,750,000 NR 1,750,000
Philadelphia, PA, School District Tax and Revenue Anticipation Notes, Series
1993A, 4.5%, 7/1/1998 (c) .................................................... 2,000,000 AAA 2,000,000
Schuykill County, PA, Industrial Development Authority, Gilberton Power Project,
Variable Weekly, 3.5%, 12/1/2002 ............................................. 5,000,000 NR 5,000,000
South Carolina
South Carolina Public Service Authority Revenue, Weekly Demand Note, 3.68%,
1/1/2023 (c) ................................................................. 2,000,000 A1+ 2,000,000
South Carolina Public Service Authority, TECP, 3.6%, 10/13/1998 ................ 3,000,000 P1 3,000,000
Tennessee
Clarksville, TN, Public Building Authority Pooled Financing, Series 1990,
Weekly Demand Note, 3.4%, 7/1/2013 (c) ....................................... 2,350,000 VMIG1 2,350,000
Franklin, TN, Industrial Development Revenue, Franklin Oaks Apartments, Weekly
Demand Note, Series 1985, 3.55%, 12/15/2021 .................................. 5,500,000 VMIG1 5,500,000
Texas
Austin, TX, Utility Systems Revenue, TECP, Series A, 3.75%, 8/12/1998 .......... 2,750,000 NR 2,750,000
Austin, TX, Utility Systems Revenue, TECP, Series A, 3.8%, 8/14/1998 ........... 1,000,000 P1 1,000,000
Dallas Area Rapid Transit, TX, Sales Tax Revenue, Series A, TECP, 3.8%,
8/14/1998 .................................................................... 1,100,000 P1 1,100,000
Houston, TX, Water & Sewer System, TECP, 3.7%, 9/10/1998 ....................... 3,850,000 NR 3,850,000
Port Development Corp., TX, Marine Terminal Refunding Revenue, Stolt Terminals,
Series 1989, Weekly Demand Note, 3.5%, 1/15/2014 ............................. 1,500,000 VMIG1 1,500,000
San Antonio, TX, Electric & Gas Public Services, Variable Rate Note, 3.64%,
2/1/2020 ..................................................................... 4,700,000 A1+ 4,700,000
San Antonio, TX, Industrial Development Authority, River Center Associates
Project, Weekly Demand Note, 3.6%, 12/1/2012 ................................. 2,800,000 A1 2,800,000
San Antonio, TX, Water System Revenue, TECP, Series 1995, 3.8%, 8/12/1998 ...... 3,000,000 P1 3,000,000
State of Texas, Tax and Revenue Anticipation Note, Series 1998A, 4.75%,
8/31/1998 .................................................................... 11,600,000 MIG1 11,623,114
State of Texas, General Obligation, Veterans Housing Assistance Refunding Bonds,
Series 1995, Weekly Demand Note, 3.4%, 12/1/2016 ............................. 2,400,000 VMIG1 2,400,000
Texas Municipal Power Agency, TECP, 3.65%, 8/14/1998 ........................... 3,000,000 P1 3,000,000
Utah
Utah, Government Obligation, Highway Authority, Series 1998A, TECP, 3.75%,
9/11/1998 .................................................................... 2,000,000 P1 2,000,000
</TABLE>
The accompanying notes are an integral part of the financial statements.
10
<PAGE>
Scudder Institutional Shares/Tax Free Money Market Series
<TABLE>
<CAPTION>
Principal Credit Value ($)
Amount ($) Rating(b) (Note A)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Vermont
Vermont Industrial Development Authority, Mount Snow, Limited Series 1904,
VRDN, 4.33%, 4/1/1999 ........................................................ 225,000 NR 225,000
Vermont Industrial Development, Vermont Marble Company, Series 1984, VRDN,
4.33%, 12/1/2004 ............................................................. 3,235,000 NR 3,235,000
Vermont Student Assistance Corporation, Student Loan Revenue, VRDN, 3.7%,
1/1/2004 ..................................................................... 4,915,000 VMIG1 4,915,000
Washington
Washington Motor Vehicle Fuel Tax, General Obligation, Series 1996, 5%,
7/1/1998 ..................................................................... 1,000,000 AA1 1,000,000
Washington Public Power Supply System, Nuclear Project #1, 1993 Series 1A-1,
Weekly Demand Note, 3.5%, 7/1/2017 ........................................... 4,560,000 P1 4,560,000
Washington, Various Purpose General Obligation, Series 1996 B, Weekly Demand
Note, 3.45%, 6/1/2020 ........................................................ 2,400,000 A1+ 2,400,000
Wisconsin
Wausau, WI, Pollution Control Revenue, Minnesota Mining and Manufacturing,
Series 1982, Weekly Demand Notes, 3.89%, 8/1/2017 ............................ 500,000 A1+ 500,000
Wisconsin Health Facility Authority, Franciscan Memorial Hospital, Weekly
Demand Note, 3.5%, 1/1/2016 .................................................. 3,500,000 VMIG1 3,500,000
Wyoming
Sweetwater County, WY, Pollution Control Revenue, Pacificorp Project, Series
1988A, TECP, 3.65%, 9/23/1998 ................................................ 4,600,000 P1 4,600,000
- ------------------------------------------------------------------------------------------------------------------------------
Total Investment Portfolio -- 100.0% (Cost $216,472,732) (a) 216,472,732
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(a) Cost for federal income tax purposes was $216,472,732.
(b) Credit ratings (unaudited) shown are either by Moody's Investors Service,
Inc., Standard & Poor's Corporation or Scudder Kemper
(c) Bond is insured by one of these companies: AMBAC, FGIC, FSA or MBIA.
Moody's Standard & Poor's
P1 A1/A1+ Commercial paper of the highest quality.
MIG1
MIG2 SP1/SP1+ Short-term tax-exempt instrument of the best
quality with strong protection.
VMIG1 Short-term tax-exempt variable rate demand
instrument of the best quality with strong
protection.
Abbreviations used in the statement:
TECP Tax Exempt Commercial Paper VRDN Variable Rate Demand Note
The accompanying notes are an integral part of the financial statements.
11
<PAGE>
Scudder Institutional Shares/Government Money Market Series
Investment Portfolio
June 30, 1998 (Unaudited)
<TABLE>
<CAPTION>
Principal Value ($)
Amount ($) (Note A)
- ------------------------------------------------------------------------------------------------------------------------------
Repurchase Agreement 13.9%
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Repurchase Agreement with State Street Bank and Trust Company dated 6/30/1998 at
5.75%, to be repurchased at $12,638,018 on 7/1/1998, collateralized by a -----------
$12,650,000 U.S. Treasury Note, 5.375%, 1/31/2000 (Cost $12,636,000) .................. 12,636,000 12,636,000
-----------
U.S. Government Agency Obligations 86.1%
- ------------------------------------------------------------------------------------------------------------------------------
Federal Farm Credit Bank, 8/3/1998 ...................................................... 6,000,000 5,971,236
Federal Home Loan Bank, 7/15/1998 ....................................................... 3,000,000 2,993,887
Federal Home Loan Bank, 8/12/1998 ....................................................... 3,000,000 2,981,625
Federal Home Loan Bank, 5.482%, 3/11/1999 ............................................... 10,000,000 9,989,471
Federal Home Loan Bank, Variable Weekly, 5.481%, 2/26/1999 .............................. 5,000,000 4,998,389
Federal Home Loan Mortgage Corp., 7/1/1998 .............................................. 3,000,000 3,000,000
Federal Home Loan Mortgage Corp., 9/8/1998 .............................................. 10,000,000 9,896,021
Federal Home Loan Mortgage Corp., 11/5/1998 ............................................. 5,000,000 4,905,279
Federal National Mortgage Association, 7/17/1998 ........................................ 5,000,000 4,987,933
Federal National Mortgage Association, 7/30/1998 ........................................ 5,000,000 4,977,847
Federal National Mortgage Association, 8/6/1998 ......................................... 2,000,000 1,989,200
Federal National Mortgage Association, 8/10/1998 ........................................ 5,000,000 4,970,278
Federal National Mortgage Association, 9/23/1998 ........................................ 4,710,000 4,650,214
Federal National Mortgage Association, 10/14/1998 ....................................... 1,975,000 1,943,779
Federal National Mortgage Association, 5.26%, 7/26/1999 ................................. 5,000,000 4,982,187
Federal National Mortgage Association, Floating Rate, 5.35%, 12/14/1998 ................. 5,000,000 5,000,000
- ------------------------------------------------------------------------------------------------------------------------------
Total U.S. Government Agency Obligations (Cost $78,237,346) 78,237,346
- ------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------
Total Investment Portfolio -- 100.0% (Cost $90,873,346) (a) 90,873,346
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(a) Cost for federal income tax purposes was $90,873,346.
The accompanying notes are an integral part of the financial statements.
12
<PAGE>
Scudder Institutional Shares
Financial Statements
Statement of Assets and Liabilities
as of June 30, 1998 (Unaudited)
<TABLE>
<CAPTION>
Tax Free Government
Money Money Money
Assets Market Series Market Series Market Series
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Investments, at value (for cost, see accompanying
lists of investment portfolios) ..................... $1,213,200,449 $ 216,472,732 $ 90,873,346
Cash .................................................. -- 609 --
Receivable for Fund shares sold ....................... 87,096 8,039 --
Receivable for investments sold ....................... -- 375,449 --
Interest receivable ................................... 8,537,012 1,562,002 184,226
Reimbursement due from Adviser ........................ 48,472 -- 30,715
Other assets .......................................... 43,316 30,763 46,145
---------------- ---------------- ---------------
Total assets .......................................... 1,221,916,345 218,449,594 91,134,432
Liabilities
- ---------------------------------------------------------------------------------------------------------------------------------
Notes payable ......................................... -- 3,750,000 --
Dividends payable ..................................... 5,571,448 617,940 397,436
Accrued management fee ................................ 220,527 20,047 23,770
Other payables and accrued expenses ................... 588,362 35,733 76,445
---------------- ---------------- ---------------
Total liabilities ..................................... 6,380,337 4,423,720 497,651
--------------------------------------------------------- ---------------- ---------------- ---------------
Net assets, at value $1,215,536,008 $ 214,025,874 $ 90,636,781
--------------------------------------------------------- ---------------- ---------------- ---------------
Net Asset Value
- ---------------------------------------------------------------------------------------------------------------------------------
Managed Shares:
Net assets applicable to shares outstanding ......... $ 323,034,844 $ 121,246,810 $ 28,361,968
Shares outstanding of capital stock, $.001 par
value, 800,000,000, 500,000,000, and
1,500,000,000 shares authorized, respectively ..... 323,034,844 121,246,810 28,361,968
Net Asset Value, offering and redemption price per ---------------- ---------------- ---------------
share (net assets / shares outstanding) ........... $1.00 $1.00 $1.00
---------------- ---------------- ---------------
Institutional Shares:
Net assets applicable to shares outstanding ......... $ 385,457,449 $ 92,779,064 $ 62,274,813
Shares outstanding of capital stock, $.001 par
value, 800,000,000, 500,000,000, and
1,500,000,000 shares authorized, respectively ..... 385,457,449 92,779,064 62,274,813
Net Asset Value, offering and redemption price per ---------------- ---------------- ---------------
share (net assets / shares outstanding) ........... $1.00 $1.00 $1.00
---------------- ---------------- ---------------
Premium Money Market Shares:
Net assets applicable to shares outstanding ......... $ 507,043,715
Shares outstanding of capital stock, $.001 par
value, 2,000,000,000 shares authorized ............ 507,043,715
Net Asset Value, offering and redemption price per ---------------
share (net assets / shares outstanding) ........... $1.00
---------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
13
<PAGE>
Scudder Institutional Shares
Financial Statements
Statement of Operations
six months ended June 30, 1998 (Unaudited)
<TABLE>
<CAPTION>
Tax Free Government
Money Money Money
Investment Income Market Series Market Series Market Series
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Interest ............................................ $ 34,860,276 $ 4,373,870 $ 2,666,570
---------------- ---------------- ----------------
Expenses:
Management fee ...................................... 1,536,264 281,992 120,716
Shareholder services ................................ 529,485 127,886 75,825
Directors' fees and expenses ........................ 10,605 9,858 6,520
Custodian and accounting fees ....................... 123,307 42,181 30,727
Reports to shareholders ............................. 29,479 6,898 4,608
Auditing ............................................ 14,258 13,646 14,030
Legal ............................................... 684 7,347 4,251
Registration fees ................................... 266,340 43,396 32,102
Other ............................................... (123,299) 12,514 (5,955)
---------------- ---------------- ----------------
Total expenses before reductions .................... 2,387,123 545,718 282,824
Expense reductions .................................. (421,267) (158,144) (90,630)
---------------- ---------------- ----------------
Expenses, net ....................................... 1,965,856 387,574 192,194
------------------------------------------------------- ---------------- ---------------- ----------------
Net investment income 32,894,420 3,986,296 2,474,376
------------------------------------------------------- ---------------- ---------------- ----------------
------------------------------------------------------- ---------------- ---------------- ----------------
Net increase in net assets resulting from operations $ 32,894,420 $ 3,986,296 $ 2,474,376
------------------------------------------------------- ---------------- ---------------- ----------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
14
<PAGE>
Scudder Institutional Shares
Financial Statements
Statements of Changes to Net Assets
Money Market Series
<TABLE>
<CAPTION>
Six Months
Ended
June 30, Year Ended
1998 December 31,
Increase (Decrease) in Net Assets (Unaudited) 1997
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Operations:
Net investment income ................................... $ 32,894,420 $ 29,622,141
------------------ ------------------
Distributions to shareholders from:
Net investment income (Managed Shares) .................. (9,577,375) (16,811,273)
------------------ ------------------
Net investment income (Institutional Shares) ............ (11,162,862) (8,101,246)
------------------ ------------------
Net investment income (Premium Money Market Shares) ..... (12,154,183) (4,709,622)
------------------ ------------------
Fund share transactions:
Managed Shares:
Proceeds from shares sold ............................... 830,044,840 1,604,556,971
Net asset value of shares issued to shareholders in
reinvestment of distributions ......................... 2,985,867 7,105,515
Cost of shares redeemed ................................. (878,908,528) (1,674,045,123)
------------------ ------------------
Net increase (decrease) in net assets from Fund share
transactions .......................................... (45,877,821) (62,382,637)
------------------ ------------------
Institutional Shares:
Proceeds from shares sold ............................... 618,828,034 697,521,385
Net asset value of shares issued to shareholders in
reinvestment of distributions ......................... 3,414,793 1,796,954
Cost of shares redeemed ................................. (574,610,951) (361,494,193)
------------------ ------------------
Net increase (decrease) in net assets from Fund share
transactions .......................................... 47,631,876 337,824,146
------------------ ------------------
Premium Money Market Shares:
Proceeds from shares sold ............................... 939,043,211 612,133,352
Net asset value of shares issued to shareholders in
reinvestment of distributions ......................... 9,138,266 2,900,558
Cost of shares redeemed ................................. (775,928,239) (280,244,979)
------------------ ------------------
Net increase (decrease) in net assets from Fund share
transactions .......................................... 172,253,238 334,788,931
------------------ ------------------
Increase (decrease) in net assets ....................... 174,007,293 610,230,440
Net assets at beginning of period ....................... 1,041,528,715 431,298,275
------------------ ------------------
Net assets at end of period ............................. $1,215,536,008 $1,041,528,715
------------------ ------------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
15
<PAGE>
Scudder Institutional Shares
Financial Statements
Statements of Changes to Net Assets
Tax Free Money Market Series
<TABLE>
<CAPTION>
Six Months
Ended
June 30, Year Ended
1998 December 31,
Increase (Decrease) in Net Assets (Unaudited) 1997
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Operations:
Net investment income ................................... $ 3,986,296 $ 4,112,832
---------------- ----------------
Distributions to shareholders from:
Net investment income (Managed Shares) .................. (2,229,945) (2,806,394)
---------------- ----------------
Net investment income (Institutional Shares) ............ (1,756,351) (1,306,438)
---------------- ----------------
Fund share transactions:
Managed Shares:
Proceeds from shares sold ............................... 233,861,276 378,820,759
Net asset value of shares issued to shareholders in
reinvestment of distributions ......................... 159,885 640,423
Cost of shares redeemed ................................. (289,292,474) (368,394,901)
---------------- ----------------
Net increase (decrease) in net assets from Fund share
transactions .......................................... (55,271,313) 11,066,281
---------------- ----------------
Institutional Shares:
Proceeds from shares sold ............................... 130,517,950 159,246,687
Net asset value of shares issued to shareholders in
reinvestment of distributions ......................... 70,590 30,480
Cost of shares redeemed ................................. (131,516,387) (65,571,803)
---------------- ----------------
Net increase (decrease) in net assets from Fund share
transactions .......................................... (927,847) 93,705,364
---------------- ----------------
Increase (decrease) in net assets ....................... (56,199,160) 104,771,645
Net assets at beginning of period ....................... 270,225,034 165,453,389
---------------- ----------------
Net assets at end of period ............................. $ 214,025,874 $ 270,225,034
---------------- ----------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
16
<PAGE>
Scudder Institutional Shares
Financial Statements
Statements of Changes to Net Assets
Government Money Market Series
<TABLE>
<CAPTION>
Six Months
Ended
June 30, Year Ended
1998 December 31,
Increase (Decrease) in Net Assets (Unaudited) 1997
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Operations:
Net investment income ................................... $ 2,474,376 $ 3,094,903
---------------- ----------------
Distributions to shareholders from:
Net investment income (Managed Shares) .................. (951,463) (1,921,752)
---------------- ----------------
Net investment income (Institutional Shares) ............ (1,522,913) (1,173,151)
---------------- ----------------
Fund share transactions:
Managed Shares:
Proceeds from shares sold ............................... 133,252,532 204,615,796
Net asset value of shares issued to shareholders in
reinvestment of distributions ......................... 240,202 426,890
Cost of shares redeemed ................................. (134,568,477) (203,521,896)
---------------- ----------------
Net increase (decrease) in net assets from Fund share
transactions .......................................... (1,075,743) (1,520,790)
---------------- ----------------
Institutional Shares:
Proceeds from shares sold ............................... 67,373,141 115,334,278
Net asset value of shares issued to shareholders in
reinvestment of distributions ......................... 69 449
Cost of shares redeemed ................................. (59,530,825) (60,903,665)
---------------- ----------------
Net increase (decrease) in net assets from Fund share
transactions .......................................... 7,842,385 54,431,062
---------------- ----------------
Increase (decrease) in net assets ....................... 6,766,642 55,951,852
Net assets at beginning of period ....................... 83,870,139 27,918,287
---------------- ----------------
Net assets at end of period ............................. $ 90,636,781 $ 83,870,139
---------------- ----------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
17
<PAGE>
Scudder Institutional Shares/Money Market Series
Financial Highlights
The following table includes selected data for a share of the Managed Shares
class outstanding throughout each period and other performance information
derived from the financial statements.
Managed Shares (b)
<TABLE>
<CAPTION>
Six Months
Ended
June 30, 1998 Years Ended December 31,
(Unaudited) 1997 1996 1995 1994 1993
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
------------------------------------------------------------------------
Net asset value, beginning of period ................ $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
------------------------------------------------------------------------
Net investment income ............................... .026 .051 .049 .054 .038 .028
Distributions from net investment income ............ (.026) (.051) (.049) (.054) (.038) (.028)
------------------------------------------------------------------------
Net asset value, end of period ...................... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
Total Return (%) (a) ................................ 2.63** 5.21 4.97 5.57 3.86 2.81
Ratios and Supplemental Data
Net assets, end of period ($ millions) .............. 323 369 431 372 367 324
Ratio of operating expenses, net to average
daily net assets (%) .............................. .42* .49 .55 .55 .55 .55
Ratio of operating expenses before expense
reductions to average daily net assets (%) ........ .47* .59 .62 .68 .68 .66
Ratio of net investment income to average
daily net assets (%) .............................. 5.25* 5.00 4.86 5.45 3.84 2.78
</TABLE>
(a) Total returns are higher due to maintenance of the Fund's expenses.
(b) Effective July 7, 1997, Scudder Money Market Series (formerly known as the
Managed Cash Fund) was divided into three classes, of which Scudder Money
Market Managed Shares is one. Shares of the Fund outstanding on such date
were redesignated as the Managed Shares of the Fund. The data set forth
above reflects the investment performance of the Fund prior to such
redesignation.
* Annualized
** Not annualized
The accompanying notes are an integral part of the financial statements.
18
<PAGE>
Scudder Institutional Shares/Money Market Series
The following table includes selected data for a share of the Institutional
Shares class outstanding throughout the period and other performance information
derived from the financial statements.
Institutional Shares
<TABLE>
<CAPTION>
For the Period
August 4, 1997
(commencement
of sale of
Six Months Institutional
Ended Shares) to
June 30, 1998 December 31,
(Unaudited) 1997
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
--------------------------------
Net asset value, beginning of period ........................................................ $ 1.000 $ 1.000
--------------------------------
Net investment income ....................................................................... .027 .022
Distributions from net investment income .................................................... (.027) (.022)
--------------------------------
Net asset value, end of period .............................................................. $ 1.000 $ 1.000
--------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
Total Return (%) (a) ........................................................................ 2.72** 2.25**
Ratios and Supplemental Data
Net assets, end of period ($ millions) ...................................................... 385 338
Ratio of operating expenses, net to average daily net assets (%) ............................ .25* .26*
Ratio of operating expenses before expense reductions, to average daily net assets (%) ...... .30* .31*
Ratio of net investment income to average daily net assets (%) .............................. 5.42* 5.39*
</TABLE>
(a) Total return is higher due to maintenance of the Fund's expenses.
* Annualized
** Not annualized
The accompanying notes are an integral part of the financial statements.
19
<PAGE>
Scudder Institutional Shares/Money Market Series
The following table includes selected data for a share of the Premium Money
Market Shares class outstanding throughout the period and other performance
information derived from the financial statements.
Premium Money Market Shares
<TABLE>
<CAPTION>
For the Period
July 7, 1997
(commencement
Six Months of sale of
Ended Premium Shares)
June 30, 1998 to December 31,
(Unaudited) 1997
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
-------------------------------
Net asset value, beginning of period ........................................................ $ 1.000 $ 1.000
-------------------------------
Net investment income ....................................................................... .027 .026
Distributions from net investment income .................................................... (.027) (.026)
-------------------------------
Net asset value, end of period .............................................................. $ 1.000 $ 1.000
-------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
Total Return (%) (a) ........................................................................ 2.68** 2.62**
Ratios and Supplemental Data
Net assets, end of period ($ millions) ...................................................... 507 335
Ratio of operating expenses, net to average daily net assets (%) ............................ .31* .38*
Ratio of operating expenses before expense reductions, to average daily net assets (%) ...... .36* .43*
Ratio of net investment income to average daily net assets (%) .............................. 5.36* 5.50*
</TABLE>
(a) Total return is higher due to maintenance of the Fund's expenses.
* Annualized
** Not annualized
The accompanying notes are an integral part of the financial statements.
20
<PAGE>
Scudder Institutional Shares/Tax Free Money Market Series
Financial Highlights
The following table includes selected data for a share of the Managed Shares
class outstanding throughout each period and other performance information
derived from the financial statements.
Managed Shares (b)
<TABLE>
<CAPTION>
Six Months
Ended
June 30, 1998 Years Ended December 31,
(Unaudited) 1997 1996 1995 1994 1993
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
------------------------------------------------------------------------
Net asset value, beginning of period ................... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
------------------------------------------------------------------------
Net investment income .................................. .016 .030 .028 .032 .023 .018
Distributions from net investment income and
net realized capital gains ........................... (.016) (.030) (.028) (.032) (.023) (.018)
------------------------------------------------------------------------
Net asset value, end of period ......................... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
Total Return (%)(a) .................................... 1.60** 3.07 2.88 3.30 2.29 1.85
Ratios and Supplemental Data
Net assets, end of period ($ millions) ................. 121 177 165 138 125 107
Ratio of operating expenses, net to average
daily net assets (%) ................................. .35* .65 .72 .79 .77 .78
Ratio of operating expenses before expense
reductions to average daily net assets (%) ........... .45* .74 .72 .79 .77 .78
Ratio of net investment income to average daily
net assets (%) ....................................... 3.21* 2.99 2.84 3.25 2.26 1.83
</TABLE>
(a) Total return is higher due to maintenance of the Fund's expenses.
(b) Effective July 7, 1997, Scudder Tax Free Money Market Series (formerly
known as Managed Tax-Free Fund) was divided into two classes, of which
Scudder Tax Free Money Market Managed Shares is one. Shares of the Fund
outstanding on such date were redesignated as the Managed Shares of the
Fund. The data set forth above reflects the investment performance of the
Fund prior to such redesignation.
* Annualized
** Not annualized
The accompanying notes are an integral part of the financial statements.
21
<PAGE>
Scudder Institutional Shares/Tax Free Money Market Series
The following table includes selected data for a share of the Institutional
Shares class outstanding throughout the period and other performance information
derived from the financial statements.
Institutional Shares
<TABLE>
<CAPTION>
For the Period
August 4, 1997
(commencement
of sale of
Six Months Institutional
Ended Shares) to
June 30, 1998 December 31,
(Unaudited) 1997
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
--------------------------------
Net asset value, beginning of period ........................................................ $ 1.000 $ 1.000
--------------------------------
Net investment income ....................................................................... .016 0.014
Distributions from net income ............................................................... (.016) (0.014)
--------------------------------
Net asset value, end of period .............................................................. $ 1.000 $ 1.000
--------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
Total Return (%) (a) ........................................................................ 1.64** 1.40**
Ratios and Supplemental Data
Net assets, end of period ($ millions) ...................................................... 93 94
Ratio of operating expenses, net to average daily net assets (%) ............................ .27* .37*
Ratio of operating expenses before expense reductions, to average daily net assets (%) ...... .37* .46*
Ratio of net investment income to average daily net assets (%) .............................. 3.28* 3.36*
</TABLE>
(a) Total return is higher due to maintenance of the Fund's expenses.
* Annualized
** Not annualized
The accompanying notes are an integral part of the financial statements.
22
<PAGE>
Scudder Institutional Shares/Government Money Market Series
Financial Highlights
The following table includes selected data for a share of the Managed Shares
class outstanding throughout each period and other performance information
derived from the financial statements.
Managed Shares (b)
<TABLE>
<CAPTION>
Six Months
Ended
June 30, 1998 Years Ended December 31,
(Unaudited) 1997 1996 1995 1994 1993
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
------------------------------------------------------------------------
Net asset value, beginning of period ................... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
------------------------------------------------------------------------
Net investment income .................................. .025 .049 .048 .054 .037 .026
Distributions from net investment income ............... (.025) (.049) (.048) (.054) (.037) (.026)
------------------------------------------------------------------------
Net asset value, end of period ......................... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
Total Return (%) (a) ................................... 2.48** 5.02 4.91 5.49 3.75 2.68
Ratios and Supplemental Data
Net assets, end of period ($ millions) ................. 28 29 28 50 69 92
Ratio of operating expenses, net to average
daily net assets (%) ................................. .54* .55 .55 .55 .55 .55
Ratio of operating expenses before expense
reductions, to average daily net assets (%) .......... .69* .84 .77 .86 .84 .77
Ratio of net investment income to average daily
net assets (%) ....................................... 4.97* 4.93 4.81 5.36 3.61 2.65
</TABLE>
(a) Total return is higher due to maintenance of the Fund's expenses.
(b) Effective July 7, 1997, Scudder Government Money Market Series (formerly
known as the Managed Government Securities Fund) was divided into two
classes, of which Scudder Government Money Market Managed Shares is one.
Shares of the Fund outstanding on such date were redesignated as the
Managed Shares of the Fund. The data set forth above reflects the
investment performance of the Fund prior to such redesignation.
* Annualized
** Not annualized
The accompanying notes are an integral part of the financial statements.
23
<PAGE>
Scudder Institutional Shares/Government Money Market Series
The following table includes selected data for a share of the Institutional
Shares class outstanding throughout the period and other performance information
derived from the financial statements.
Institutional Shares
<TABLE>
<CAPTION>
For the Period
August 4, 1997
(commencement
of sale of
Six Months Institutional
Ended Shares) to
June 30, 1998 December 31,
(Unaudited) 1997
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
--------------------------------
Net asset value, beginning of period ......................................................... $ 1.000 $ 1.000
--------------------------------
Net investment income ........................................................................ .026 .022
Distributions from net investment income ..................................................... (.026) (.022)
--------------------------------
Net asset value, end of period ............................................................... $ 1.000 $ 1.000
--------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
Total Return (%) (a) ......................................................................... 2.62** 2.17**
Ratios and Supplemental Data
Net assets, end of period ($ millions) ....................................................... 62 54
Ratio of operating expenses, net to average daily net assets (%) ............................. .30* .31*
Ratio of operating expenses before expense reductions, to average daily net assets (%) ....... .45* .46*
Ratio of net investment income to average daily net assets (%) ............................... 5.22* 5.21*
</TABLE>
(a) Total return is higher due to maintenance of the Fund's expenses.
* Annualized
** Not annualized
The accompanying notes are an integral part of the financial statements.
24
<PAGE>
Scudder Institutional Shares
Notes to Financial Statements (Unaudited)
A. Significant Accounting Policies
Scudder Fund, Inc. (the "Company") is an open-end diversified management
investment company comprised of three diversified money market portfolios:
Scudder Money Market Series (formerly known as Managed Cash Fund), Scudder Tax
Free Money Market Series (formerly known as Managed Tax Free Fund), and Scudder
Government Money Market Series (formerly known as Managed Government Securities
Fund) (collectively, the "Funds"). Scudder Tax Free Money Market Series and
Scudder Government Money Market Series offer two classes of shares,
Institutional Class and Managed Class and Scudder Money Market Series offers
three classes of shares, Institutional Class, Managed Class and Premium Money
Market Class.
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.
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, as
amended, 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.
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.
Repurchase Agreements. The Company may enter into repurchase agreements with
certain banks and broker/dealers whereby the Fund, through its custodian,
receives delivery of the underlying securities, the amount of which at the time
of purchase and each subsequent business day is required to be maintained at
such a level that the market value, depending on the maturity of the repurchase
agreement, is equal to at least 100.5% of the repurchase price.
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.
B. Related Parties
Under the Investment Management Agreements (the "Management Agreement") with
Scudder Kemper Investments, Inc. ("Scudder Kemper" or the "Adviser"), the
Adviser directs the investments of each Fund in accordance with its investment
objectives, policies, and restrictions. The Adviser determines the securities,
instruments, and other contracts relating to investments to be purchased, sold,
or entered into by each Fund. The Adviser receives an investment management fee
at an annual rate of 0.25% of average daily net assets for each Fund. Also, the
Adviser has agreed to waive a portion of its investment management fee for each
of the Money Market Series, Tax Free Money Market Series, and Government Money
Market Series to the extent necessary so that the total annualized investment
management fee of each Fund does not exceed 0.05%, 0.10%, and 0.15%,
respectively.
For the six months ended June 30, 1998, the Adviser did not impose fees of
$337,266, $98,144, and $72,630 and did impose fees of $1,198,998, $183,848, and
$48,086.
25
<PAGE>
Scudder Service Corporation ("SSC"), a subsidiary of the Adviser, is the
transfer, dividend-paying and shareholder service agent for the Funds. Each
class of each Fund has entered into a Transfer Agency and Service Agreement with
SSC. SSC receives account fees that vary according to the account size and type
of account of the shareholders of the respective classes. For the six months
ended June 30, 1998 the following amounts were charged:
<TABLE>
<CAPTION>
Money Market Tax Free Government
Series Money Market Money Market
Series Series
<S> <C> <C> <C>
Managed Class $ 149,649 $ 14,934 $ 25,306
Institutional Class 7,500 7,500 7,500
Premium Class 95,542 -- --
---------- ---------- ----------
$ 252,691 $ 22,434 $ 32,806
========== ========== ==========
</TABLE>
Each of the Funds has special arrangements with certain banks, institutions and
other persons under which they receive compensation from the Funds and the
Adviser for performing shareholder servicing functions for their customers who
own shares in the Funds. The Adviser has agreed to reimburse the Funds for
amounts payable by the Scudder Managed Class Shares, such that the fees in basis
points paid by the class will be no greater than the total transfer agent fee
payable to SSC. For the six months ended June 30, 1998, the Adviser's
reimbursement payable aggregated $272,006 for the Money Market Series, $126,725
for the Tax Free Money Market Series, and $28,224 for the Government Money
Market Series.
Scudder Fund Accounting Corporation ("SFAC"), a subsidiary of the Adviser, is
responsible for determining the daily net asset value per share and maintaining
the portfolio and general accounting records for the Funds. For the six months
ended June 30, 1998, the amount charged to the Funds by SFAC aggregated $75,337
for the Money Market Series, $20,029 for the Tax Free Money Market Series, and
$14,831 for the Government Money Market Series, of which $13,123, $4,171, and
$3,759, respectively, remain unpaid at June 30, 1998.
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 $234,885, an
applicable portion of which is included in accrued expenses of each such Fund.
Other. Printing and postage expenses related to preparing and distributing
material such as shareholder reports, prospectuses and proxy materials to
current shareholders are charged to each class based on number of shareholder
accounts. For the six months ended June 30, 1998, the following amounts were
paid:
<TABLE>
<CAPTION>
Money Market Tax Free Government
Series Money Market Money Market
Series Series
<S> <C> <C> <C>
Managed Class $ 2,108 $ 1,243 $ 766
Institutional Class 2,707 1,902 1,722
Premium Class 3,479 -- --
---------- ---------- ----------
$ 8,294 $ 3,145 $ 2,488
========== ========== ==========
</TABLE>
26
<PAGE>
C. Lines of Credit
During the six months ended June 30, 1998, the Tax Free Money Market Series
periodically borrowed amounts from a bank under an uncommitted line of credit
arrangement at the existing prime rates. The arrangement with the bank allows
the Fund to borrow a maximum amount based on total net assets. During the six
months ended June 30, 1998, the weighted average outstanding daily balance of
bank loans (based on the average number of days the loans were outstanding) was
approximately $2.6 million, with a weighted average interest rate of 6.10%.
Interest expense for the period ended June 30, 1998, was approximately $39,000.
27
<PAGE>
About the Fund's Adviser
Scudder Kemper Investments, Inc., is one of the largest and most experienced
investment management oganizations worldwide, managing more than $200 billion in
assets globally for mutual fund investors, retirement and pension plans,
institutional and corporate clients, insurance companies, and private family and
individual accounts. It is one of the ten largest mutual fund companies in the
United States.
Scudder Kemper Investments has a rich heritage of innovation, integrity, and
client-focused service. In 1997, Scudder, Stevens & Clark, Inc., founded 79
years ago as one of the nation's first investment counsel organizations, joined
the Zurich Group. As a result, Zurich's subsidiary, Zurich Kemper Investments,
Inc., with 50 years of mutual fund and investment management experience, was
combined with Scudder. Headquartered in New York, Scudder Kemper Investments
offers a full range of investment counsel and asset management capabilities,
based on a combination of proprietary research and disciplined, long-term
investment strategies. With its global investment resources and perspective,
the firm seeks opportunities in markets throughout the world to meet the needs
of investors.
Scudder Kemper Investments, Inc., the global asset management firm, is a member
of the Zurich Group. The Zurich Group is an internationally recognized leader in
financial services, including property/casualty and life insurance, reinsurance,
and asset management.
This information must be preceded or accompanied by a current prospectus.
Portfolio changes should not be considered recommendations for action by
individual investors.
SCUDDER
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