- -------------------------------------------------------------------------------
DAILY
TAX FREE
INCOME
FUND, INC.
Semi-Annual Report
April 30, 1996
(Unaudited)
- -------------------------------------------------------------------------------
<PAGE>
- -------------------------------------------------------------------------------
DAILY TAX FREE 600 FIFTH AVENUE, NEW YORK, NY 10020
INCOME FUND, INC. 212-830-5200
===============================================================================
Dear Shareholder:
We are pleased to present the semi-annual report of Daily Tax Free Income Fund,
Inc. for the period November 1, 1995 through April 30, 1996. As of the end of
the period, the Fund had net assets of $754,164,142 and 5,021 active
shareholders.
We thank you for your support of Daily Tax Free Income Fund, Inc. and look
forward to continuing to serve your cash management needs.
Sincerely,
/s/ Steven W. Duff
Steven W. Duff
President
- -------------------------------------------------------------------------------
<PAGE>
- -------------------------------------------------------------------------------
DAILY TAX FREE INCOME FUND, INC.
STATEMENT OF NET ASSETS
APRIL 30, 1996
(UNAUDITED)
===============================================================================
<TABLE>
<CAPTION>
Ratings (a)
----------------
Face Value Standard
Amount Yield (Note 1) Moody's & Poor's
------ ----- -------- ------- ------
Variable Rate Demand Instruments -
Participations (c) (4.71%)
- ----------------------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <C> <C> <C>
$ 3,292,383 The Bank of New York LOC covering eight issues
due 10-01-98 through 05-01-01 4.95% $ 3,292,383 P1 A1+
19,747,382 Chemical Bank LOC covering sixteen issues
due 11-10-98 through 05-01-13 4.53% to 5.50% 19,747,382 P1 A1+
1,915,235 The First National Bank of Maryland
LOC covering eight issues
due 09-16-96 through 09-15-02 4.95% 1,915,235 P1 A1
245,083 LaSalle National Bank
LOC covering one issue due 07-01-00 4.95% 245,083 P1 A1+
8,221,250 PNC Bank, N.A. LOC covering three issues
due 07-29-97 through 10-15-13 5.28% to 6.90% 8,221,250 P1
2,062,500 The Sumitomo Bank of California LOC
Backed by Sumitomo Bank, Ltd. LOC
covering one issue due 05-01-96 5.60% 2,062,500 P1 A1+
- ----------- -----------
35,483,833 Total Variable Rate Demand Instruments - Participations 35,483,833
- ---------- -----------
<CAPTION>
Variable Rate Demand Instruments -
Private Placements (c) (14.11%)
- ----------------------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <C> <C> <C>
$ 100,000 The Bank of California, N.A. LOC covering one issue
due 06-30-96 7.00% $ 100,000 P1 A1+
10,906,951 Banc One Arizona LOC covering five issues
due 01-01-99 through 01-01-11 5.36% 10,906,951 P1 A1
13,176,000 Bank of Tokyo, Ltd. LOC covering four issues
due 12-01-09 through 12-01-15 4.95% to 5.36% 13,176,000 P1 A1
375,833 Central Trust Company LOC Backed by Bank of New York
LOC covering two issues due 01-01-99 4.95% 375,833 P1 A1
2,041,885 Comerica Bank - Detroit LOC covering four issues
due 02-01-00 through 05-01-05 4.95% 2,041,885 P1 A1
1,500,000 Credit Suisse LOC covering one issue due 12-01-00 4.95% 1,500,000 P1 A1+
6,000,000 Creditanstalt-Bankverein LOC covering two issues
due 11-01-05 through 06-01-10 4.95% 6,000,000 P1 A1+
2,000,000 Dresdner Bank AG LOC covering two issues
due 12-28-14 through 08-01-15 4.95% 2,000,000 P1 A1+
9,400,000 The First National Bank of Maryland LOC covering three issues
due 07-01-04 through 12-01-20 4.25% to 5.36% 9,400,000 P1 A1
</TABLE>
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See Notes to Financial Statements.
<PAGE>
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===============================================================================
<TABLE>
<CAPTION>
Ratings (a)
-----------------
Face Value Standard
Amount Yield (Note 1) Moody's & Poor's
------ ----- -------- ------- ------
Variable Rate Demand Instruments -
Private Placements (c) (Continued)
- -----------------------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <C> <C> <C>
$ 3,489,775 The Huntington National Bank LOC covering two issues
due 12-01-98 through 10-01-05 4.30% to 5.61% $ 3,489,775 P1 A1
1,248,333 Key Bank, N.A. LOC covering one issue due 07-01-15 4.95% 1,248,333 P1 A1
539,060 Nations Bank, N.A. LOC covering one issue due 12-01-99 5.36% 539,060 P1 A1
4,132,000 PNC Bank, N.A. LOC covering two issues
due 12-01-00 through 06-30-02 5.36% 4,132,000 P1 A1+
3,974,000 Norwest Bank, N.A. LOC covering three issues
due 07-01-00 through 12-01-15 5.11% to 5.36% 3,974,000 P1 A1+
28,309,700 Seattle-First National Bank LOC
Backed by Bank of America, NT & SA LOC
covering thirteen issues due 12-15-00 through 11-15-15 5.36% 28,309,700 P1 A1
1,690,000 State Street Bank & Trust Company
LOC covering one issue due 01-01-02 4.95% 1,690,000 P1 A1+
1,900,000 Wells Fargo Bank, N.A. LOC covering two issues
due 12-15-04 through 08-01-05 5.03% 1,900,000 P1 A1+
4,000,000 York Bank and Trust covering one issue due 12-01-14 (b) 3.90% 4,000,000
11,631,820 Zion's National Bank Liquidity Facility covering one issue
due 12-10-15 5.36% 11,631,820 P2 A2
- ----------- -----------
106,415,357 Total Variable Rate Demand Instruments - Private Placements 106,415,357
- ----------- -----------
</TABLE>
<TABLE>
<CAPTION>
Ratings (a)
----------------
Face Maturity Standard
Amount Date Yield Value Moody's & Poor's
------ ---- ----- ----- ------- ------
Other Tax Exempt Investments (11.53%)
- -----------------------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <C> <C> <C> <C>
$ 4,995,000 Barton County, GA TAN - Series 1996 (b) 12/31/96 3.44% $ 5,003,054
10,000,000 Colorado State General Fund Revenue TRAN - Series A 06/27/96 3.65 10,011,703 SP-1+
10,000,000 Commonwealth of Kentucky State
Property and Building Commission
Revenue and Revenue Refunding Bonds (Project #59) 11/01/96 3.88 10,026,627 A+
5,000,000 Cobb County, GA TAN - Series 1996 12/31/96 3.44 5,016,235 MIG-1 SP-1+
1,000,000 Douglas County, WA TAN - Series 1996A (b) 12/15/96 4.00 1,000,000
5,490,000 Richfield, MN Independent School District #280
TAN - Series 1996 (b) 03/07/97 3.46 5,508,013
10,000,000 State of Illinois RAN 05/10/96 3.71 10,001,688 MIG-1 SP-1+
</TABLE>
- --------------------------------------------------------------------------------
See Notes to Financial Statements.
<PAGE>
- --------------------------------------------------------------------------------
DAILY TAX FREE INCOME FUND, INC.
STATEMENT OF NET ASSETS (CONTINUED)
APRIL 30, 1996
(UNAUDITED)
===============================================================================
<TABLE>
<CAPTION>
Ratings (a)
----------------
Face Maturity Standard
Amount Date Yield Value Moody's & Poor's
------ ---- ----- ----- ------- ------
Other Tax Exempt Investments (Continued)
- -----------------------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <C> <C> <C> <C>
$ 8,685,000 State of Maine GO TAN 06/28/96 3.73% $ 8,694,282 MIG-1 SP-1+
31,650,000 State of Texas TRAN - Series 1995A 08/30/96 3.96 31,722,201 MIG-1 SP-1+
- ----------- -----------
86,820,000 Total Other Tax Exempt Investments 86,983,803
- ----------- -----------
<CAPTION>
Other Variable Rate Demand Instruments (c) (51.60%)
- -----------------------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <C> <C> <C> <C>
$ 6,000,000 Alameda County, CA IDRB
(Hoover University Inc. Project) - Series 1994 06/01/04 3.80% $ 6,000,000 VMIG-1 A1
2,650,000 Austin County, TX Industrial Development Corporation IDRB
(Justin Industry Incorporated Project)
LOC Citibank 02/01/14 4.20 2,650,000 Aa3
2,230,000 Baldwin County, GA (William Barnet and Son Project)
LOC Fleet National Bank & Trust 12/01/99 4.47 2,230,000 A1
3,100,000 Broward County, FL HFA
MHRB (Sanctuary Apartments Project)
LOC PNC Bank, N.A. 02/01/09 4.15 3,100,000 VMIG-1
700,000 California PCFA PCRB
(Southern California Edison) - Series A 02/28/08 3.65 700,000 P1 A1+
2,400,000 California PCFA PCRB
(Southern California Edison) - Series B 02/28/08 3.65 2,400,000 VMIG-1 A1+
2,000,000 California PCFA PCRB
(Southern California Edison) - Series C 02/28/08 3.65 2,000,000 VMIG-1 A1+
1,100,000 California PCFA PCRB
(Southern California Edison) - Series D 02/28/08 3.65 1,100,000 P1 A1+
9,200,000 Carlton, WI (Wisconsin Power & Light) - Series B (b)
LOC Union Bank of Switzerland 09/01/05 4.05 9,200,000
4,000,000 Chelan County, Washington Public Utilities District #001
(Chelan Hydro) - Series A
MBIA Insured 06/01/15 4.00 4,000,000 VMIG-1 A1+
1,000,000 City of Atlantic Beach, FL (Fleet Landing)
LOC Barnett Bank 10/01/24 4.15 1,000,000 VMIG-1
4,550,000 Clarksville, TN Public Building Authority Pooled Financing RB
LOC Nationsbank 06/01/24 4.20 4,550,000 A1
6,400,000 Clayton, MO IDRB (Bailey Court Project)
LOC Bankers Trust Company 01/01/09 4.22 6,400,000 VMIG-1
5,000,000 Colorado HFA (Grant Plaza Project)
LOC Bankers Trust Company 11/01/09 4.22 5,000,000 VMIG-1
</TABLE>
- -------------------------------------------------------------------------------
See Notes to Financial Statements.
<PAGE>
- -------------------------------------------------------------------------------
===============================================================================
<TABLE>
<CAPTION>
Ratings (a)
----------------
Face Maturity Standard
Amount Date Yield Value Moody's & Poor's
------ ---- ----- ----- ------- ------
Other Variable Rate Demand Instruments (c) (Continued)
- -----------------------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <C> <C> <C> <C>
$ 5,000,000 Connecticut HFA (Housing Mortgage Finance Program)
AMBAC Insured 05/15/18 4.15% $ 5,000,000 VMIG-1
9,900,000 Connecticut, Development Authority
(Connecticut Light & Power) - Series 1993A
LOC Deutsche Bank A.G. 09/01/28 4.20 9,900,000 VMIG-1 A1+
6,600,000 County of Contra Costa, MHRB Mortgage Refunding
(Rivershore Apartments) - Series 1992B
Fannie Mae (Unconditional Guaranty) 11/15/22 3.85 6,600,000 A1+
4,850,000 Coweta County, GA Development Authority RB
(Jack Eckerd Project) (b)
LOC Union Bank of Switzerland 03/01/09 4.10 4,850,000
2,435,000 Dade County, FL Industrial Development PCRB
(Florida Power & Light Company Project) 04/01/20 4.05 2,435,000 VMIG-1 A1+
3,600,000 Dade County, FL HFA MHRB
(Gable Point Apartment Project) - Series 1995C
Fannie Mae (Unconditional Guaranty) 05/15/05 3.90 3,600,000 A1+
14,600,000 DeKalb County, GA Housing Authority
LOC Bank of Montreal 12/01/07 4.15 14,600,000 A1+
1,900,000 Florida HFA MHRB
(Monterey Meadows Apartment Project) - Series 1985
LOC Citibank 12/01/07 4.20 1,900,000 VMIG-1 A1+
1,235,000 Gulf Breeze, FL RB Series - 1985B
FGIC Insured 12/01/15 4.15 1,235,000 VMIG-1 A1+
10,000,000 Hammond, LA IDB (Eckerds Warehouse Project) (b)
LOC Union Bank of Switzerland 05/01/13 4.05 10,000,000
1,400,000 Hillsborough County, FL Development Authority PCRB
(Tampa Gas & Electric Company Gannon) 05/15/18 4.00 1,400,000 VMIG-1 A1+
4,700,000 Illinois Charitabulls Development Finance Authority
(James Jordan Boys & Girls Club
& Family Life Center Project) - Series 1995
LOC American National Bank & Trust Company of Chicago/
LaSalle National Bank 08/01/30 4.15 4,700,000 A1
6,000,000 Illinois IDFA Chicago Educational Television
LOC Harris Trust & Savings Bank 11/01/14 4.10 6,000,000 VMIG-1
25,400,000 Illinois HFA (Northwestern Memorial Hospital) - Series 1995 08/15/25 3.90 25,400,000 VMIG-1 A1+
</TABLE>
- -------------------------------------------------------------------------------
See Notes to Financial Statements.
<PAGE>
- -------------------------------------------------------------------------------
DAILY TAX FREE INCOME FUND, INC.
STATEMENT OF NET ASSETS (CONTINUED)
APRIL 30, 1996
(UNAUDITED)
===============================================================================
<TABLE>
<CAPTION>
Ratings (a)
----------------
Face Maturity Standard
Amount Date Yield Value Moody's & Poor's
------ ---- ----- ----- ------- ------
Other Variable Rate Demand Instruments (c) (Continued)
- -----------------------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <C> <C> <C> <C>
$11,000,000 Illinois HFA (Resurrection Hospital) 05/01/11 4.05% $11,000,000 VMIG-1
19,400,000 Illinois Museum of Contemporary Art 1994
LOC Northern Trust\Harris Trust\LaSalle National\
National Bank of Detroit 02/01/29 4.10 19,400,000 VMIG-1 A1+
5,000,000 Jackson County, MI EDC (Thrifty Leoni)
LOC First National Bank of Chicago 12/01/14 4.30 5,000,000 Aa3
2,300,000 City of Jacksonville, FL PCRB
(Florida Power and Light Company Project) - Series 1995 05/01/29 4.00 2,300,000 VMIG-1 A1+
3,600,000 Jacksonville, FL HFA RB
(Baptist Health Property Project)
LOC Barnett Bank 06/01/20 4.50 3,600,000 VMIG-1 A1
5,000,000 Kansas Department TRAN Series - 1994B 09/01/14 4.10 5,000,000 VMIG-1 A1+
3,850,000 Maryland IDFA EDRB (The Barre School Facility)
LOC Nationsbank 07/01/14 4.20 3,850,000 A1
1,470,000 Mecklenberg County, NC (Aplix, Inc.)
LOC Wachovia Bank & Trust Co., N.A. 12/01/99 4.15 1,470,000 Aa2
13,200,000 Michigan Strategic Consumer Fund
LOC Canadian Imperial Bank 06/15/10 3.85 13,200,000 A1+
8,200,000 Michigan Strategic Fund Ltd. Obligation RB
(Detroit Edison)
LOC Barclays Bank 09/01/30 3.85 8,200,000 P1 A1+
5,710,000 Missouri State HEFA (Barnes Hospital)
LOC Morgan Guaranty Trust Company 12/01/15 4.10 5,710,000 VMIG-1 A1+
5,700,000 Missouri State HEFA - Washington University 09/01/10 4.20 5,700,000 VMIG-1 A1+
14,000,000 Monroe County, MI (Detroit Edison)
LOC Barclays Bank 10/01/24 3.85 14,000,000 VMIG-1
8,000,000 Montgomery County, MD Housing Opportunity Commission
LOC General Electric Capital Corporation 11/01/07 4.35 8,000,000 A1+
2,000,000 Montgomery County, TX
(Houston Area Residential Center Project) - Series 1985
LOC Morgan (J.P.) Securities, Inc. 12/01/15 4.10 2,000,000 A1+
4,850,000 Montgomery County, MD EDC RB
(Brooke Grove Foundations, Incorporated Facilities)-Series 1995
LOC First National Bank of Maryland 01/01/16 3.95 4,850,000 P1
</TABLE>
- -------------------------------------------------------------------------------
See Notes to Financial Statements.
<PAGE>
- -------------------------------------------------------------------------------
===============================================================================
<TABLE>
<CAPTION>
Ratings (a)
----------------
Face Maturity Standard
Amount Date Yield Value Moody's & Poor's
------ ---- ----- ----- ------- ------
Other Variable Rate Demand Instruments (c) (Continued)
- -----------------------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <C> <C> <C> <C>
$ 1,000,000 New Jersey, EDA (400 International Drive Rockefeller Corporation) (b)
LOC Morgan Guaranty Trust Company 09/01/05 3.50% $ 1,000,000
10,400,000 New York City GO - Series B
FGIC Insured 10/01/21 4.20 10,400,000 VMIG-1 A1+
8,600,000 North Carolina Medical Care Commission
(Carol Woods Project)
LOC Bank of Scotland 04/01/21 4.05 8,600,000 VMIG-1
900,000 North Carolina Medical Care Commission - Series 1991B
LOC First Union National Bank 10/01/13 4.00 900,000 VMIG-1
7,700,000 Ontario, CA IDA (LD Brinkman & Co.)
LOC Barclays Bank 04/01/15 3.80 7,700,000 P1
1,000,000 Orange County, FL HFA (Adventist)
LOC Banque Paribas 11/15/14 4.45 1,000,000 VMIG-1
7,840,000 Orange County, FL
(Mayflower Retirement Community Project) - Series 1988
LOC Rabobank Nederland 03/01/18 4.30 7,840,000 A1+
2,600,000 Oyster Point, VA Development Corporation - Series 1991 11/01/11 4.55 2,600,000 A1+
2,000,000 Palm Beach County, FL - Series 1995
(Northern Gallery of Art Project)
LOC Northern Trust 05/01/25 4.10 2,000,000 A1+
7,350,000 Phoenix, AZ IDA MHRB Refunding
(Bell Square Apartments Project) - Series 1995
LOC General Electric Capital Corporation 06/01/25 4.40 7,350,000 A1+
3,500,000 Phoenix, AZ IDA MHRB
(Paradise Lakes Apartments Project) - Series 1995
LOC General Electric Capital Corporation 07/01/25 4.40 3,500,000 A1+
2,250,000 Pierce County, Atlas Foundry
LOC First National Bank of Seattle 05/01/05 5.36 2,250,000 Aa1
5,190,000 Pinellas County, FL HFA - Series 1987
(St. Mark Village Project)
LOC Nationsbank 03/01/17 4.20 5,190,000 A1
5,000,000 Pitkin County, CO IDA
(Aspen Skiing Co. Project) - Series A
LOC First National Bank of Chicago 04/01/16 4.05 5,000,000 A1+
2,750,000 Prince Georges County, MD EDC RB
LOC Fleet National Bank & Trust 09/30/15 5.36 2,750,000 P1 A1
</TABLE>
- -------------------------------------------------------------------------------
See Notes to Financial Statements.
<PAGE>
- -------------------------------------------------------------------------------
DAILY TAX FREE INCOME FUND, INC.
STATEMENT OF NET ASSETS (CONTINUED)
APRIL 30, 1996
(UNAUDITED)
===============================================================================
<TABLE>
<CAPTION>
Ratings (a)
----------------
Face Maturity Standard
Amount Date Yield Value Moody's & Poor's
------ ---- ----- ----- ------- ------
Other Variable Rate Demand Instruments (c) (Continued)
- -----------------------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <C> <C> <C> <C>
$ 2,000,000 Polk County, FL IDA PCRB
(IMC Fertilizer Incorporated Project)
LOC Rabobank Nederland 02/01/00 4.10% $ 2,000,000 P1
4,000,000 Raleigh Durham Airport Authority, Special Facility RB
(American Airlines Project) - Series 1995A
LOC Royal Bank of Canada 11/01/15 4.10 4,000,000 A1+
3,055,000 St. Cloud, MN Commercial Development RFDG
(Kelly Inn Project) (b)
LOC First Bank of South Dakota 04/01/13 4.15 3,055,000
10,500,000 St. Lucie County, FL PCRB
(Florida Power & Light Company Project) 03/01/27 4.00 10,500,000 VMIG-1 A1+
5,100,000 San Antonio, TX IDA (Rivercenter Project)
LOC PNC Bank, N.A. 12/01/12 4.15 5,100,000 A1
2,900,000 Salina, KS (Dillards Project) (b)
LOC Boatmens National Bank of St. Louis 12/01/14 4.35 2,900,000
2,130,000 County of Sarpy, NE PCR Refunding Bond
(Allied Signal Inc. Project) - Series 1995 07/01/13 4.25 2,130,000 A1
2,000,000 Southgate, MI EDC EDRB (Trust Realty Corp. Project)
LOC Bankers Trust Company 10/01/18 4.22 2,000,000 A1
1,200,000 State of New York, Dorm Authority
(Cornell University) - Series 1990B 07/01/23 4.30 1,200,000 VMIG-1
5,100,000 State of Ohio Environmental Improvement
(U.S. Steel Corp. USX)
LOC PNC Bank, N.A. 12/01/01 3.60 5,100,000 P1
2,155,000 Terre Haute, IN EDRB
(Westminster Village Terre Haute Inc.)
LOC Huntington National Bank 07/01/01 4.60 2,155,000 P1 A1
11,200,000 Union County, NJ PCFA
(Exxon Corporation) - Series 1994 07/01/33 3.50 11,200,000 P1 A1+
1,500,000 University Athletic Association Inc.
Florida Capital Improvement RB
LOC Sun Bank National Association 02/01/20 4.15 1,500,000 VMIG-1
7,000,000 City of Valdez Alaska Marine Terminal TRAN - Series 1994B 05/01/31 4.20 7,000,000 VMIG-1 A1
- ----------- -----------
389,150,000 Total Other Variable Rate Demand Instruments 389,150,000
- ----------- -----------
</TABLE>
- -------------------------------------------------------------------------------
See Notes to Financial Statements.
<PAGE>
- -------------------------------------------------------------------------------
===============================================================================
<TABLE>
<CAPTION>
Ratings (a)
----------------
Face Maturity Standard
Amount Date Yield Value Moody's & Poor's
------ ---- ----- ----- ------- ------
Put Bonds (d) (5.54%)
- -----------------------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <C> <C> <C> <C>
$ 2,500,000 Cook County, IL (b) 08/06/96 3.40% $ 2,500,000
9,860,000 DeKalb County, GA MHRB - Series 1985L
LOC Amsouth Bank N.A. 12/01/96 3.95 9,860,000 A1+
14,310,000 Fulton County, GA - Series 1985B
LOC Amsouth Bank N.A. 08/01/96 3.94 14,310,000 A1+
4,000,000 Joliet Illinois Gas Supply Revenue
- Peoples Gas, Light & Core 10/01/96 4.00 4,000,000 VMIG-1
1,130,000 New Mexico Mortgage Finance Authority - Series 1996
Subseries B-1
Single Family Mortgage Program Bonds
FGIC Insured 02/28/97 3.15 1,130,000 SP-1+
10,000,000 State of Connecticut Special Assessment - Series 1993C
FGIC Insured 07/01/96 3.90 10,000,000 VMIG-1 AAA
- ----------- -----------
41,800,000 Total Put Bonds 41,800,000
- ----------- -----------
<CAPTION>
Tax Exempt Commercial Paper (11.27%)
- -----------------------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <C> <C> <C> <C>
$ 6,300,000 Burke County, GA (Oglethorpe Power Co.)
LOC Credit Suisse 06/06/96 3.25% $ 6,300,000 P1 A1+
12,000,000 Burke County, GA (Oglethorpe Power Co.)
LOC Credit Suisse 06/10/96 3.20 12,000,000 P1 A1+
6,100,000 City of Burlington, KS Customized Purchase PCRB
(Kansas City Power and Light Company Project) - Series 1987B
LOC Deutsche Bank A.G. 06/06/96 3.10 6,100,000 P1 A1+
9,600,000 City of Burlington, KS Customized Purchase PCRB
(Kansas City Power and Light Company Project) - Series 1987B
LOC Toronto Dominion 05/02/96 3.90 9,600,000 P1 A1+
10,000,000 City of Houston, Texas - Series A 08/21/96 3.20 10,000,000 P1 A1+
3,000,000 Delaware County, PA IDA PCRB - Series B
FGIC Insured 05/02/96 3.55 3,000,000 VMIG-1
10,000,000 Georgia Municipal Electric Authority - Series 1985A
LOC Bayerische Landesbank/
Credit Suisse\Morgan Guaranty Trust Company 05/01/96 3.90 10,000,000 VMIG-1 A1+
6,000,000 Georgia Municipal Gas Authority
(Southern Portfolio IPJ)
LOC Wachovia Bank & Trust 06/03/96 3.10 6,000,000 A1+
</TABLE>
- -------------------------------------------------------------------------------
See Notes to Financial Statements.
<PAGE>
- -------------------------------------------------------------------------------
DAILY TAX FREE INCOME FUND, INC.
STATEMENT OF NET ASSETS (CONTINUED)
APRIL 30, 1996
(UNAUDITED)
===============================================================================
<TABLE>
<CAPTION>
Ratings (a)
----------------
Face Maturity Value Standard
Amount Date Yield (Note 1) Moody's & Poor's
------ ---- ----- ------ ------- ------
Tax Exempt Commercial Paper (Continued)
- -----------------------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <C> <C> <C> <C>
$ 8,000,000 Lincoln County, WY PCRB
(Pacific Corporation Project) - Series 1991
LOC Union Bank of Switzerland 07/10/96 3.25% $ 8,000,000 VMIG-1 A1+
2,000,000 Orlando, FL Waste Water System RB - Series 1990A 09/10/96 3.45 2,000,000 VMIG-1 A1+
2,000,000 Platte River Authority, CO
Adjustable Tender Electric RB (Subordinate Lien) - Series 5-1 05/08/96 3.05 2,000,000 VMIG-1 A1
10,000,000 State of New Jersey TAN 05/03/96 3.90 10,000,000 P1 A1+
---------- -----------
85,000,000 Total Tax Exempt Commercial Paper 85,000,000
- ----------- -----------
Total Investments (98.76%)(Cost $744,832,993+) 744,832,993
Cash and Other Assets in Excess of Liabilities (1.24%) 9,331,149
-----------
Net Assets (100.00%) $754,164,142
===========
Class A Shares, 440,544,082 Shares Outstanding (Note 3) $ 1.00
===========
Class B Shares, 313,734,311 Shares Outstanding (Note 3) $ 1.00
===========
+ Aggregate cost for federal income tax purpose is identical.
</TABLE>
- -------------------------------------------------------------------------------
See Notes to Financial Statements.
<PAGE>
- -------------------------------------------------------------------------------
===============================================================================
FOOTNOTES:
(a) The ratings noted for variable rate demand instruments are those of the
bank whose letter of credit secures such instruments or the guarantor of
the bond. P1 and A1+ are the highest ratings assigned for tax exempt
commercial paper.
(b) Securities that are not rated which the Fund's Board of Directors has
determined to be of comparable quality to the rated securities in which the
Fund invests.
(c) Securities payable on demand at par including accrued interest (usually
with seven days notice) and unconditionally secured as to principal and
interest by a bank letter of credit. The interest rates are adjustable and
are based on bank prime rates or other interest rate adjustment indices.
The rate shown is the rate in effect at the date of this statement.
(d) The maturity date indicated for the put bonds is the next put date.
<TABLE>
<CAPTION>
KEY:
<S> <C> <C> <C> <C> <C>
EDA = Economic Development Authority IDRB = Industrial Develoment Revenue Bond
EDC = Economic Development Corporation MHRB = Multifamily Housing Revenue Bond
EDRB = Economic Development Revenue Bond PCFA = Pollution Control Finance Authority
GO = General Obligation PCR = Pollution Control Revenue
HEFA = Hospital & Education Finance Authority PCRB = Pollution Control Revenue Bond
HFA = Housing Finance Authority RAN = Revenue Anticipation Note
IDA = Industrial Development Authority RB = Revenue Bond
IDB = Industrial Development Bond TAN = Tax Anticipation Note
IDFA = Industrial Development Finance Authority TRAN = Tax and Revenue Anticipation Note
</TABLE>
- -------------------------------------------------------------------------------
See Notes to Financial Statements.
<PAGE>
- -------------------------------------------------------------------------------
DAILY TAX FREE INCOME FUND, INC.
STATEMENT OF OPERATIONS
SIX MONTHS ENDED APRIL 30, 1996
(UNAUDITED)
===============================================================================
<TABLE>
<CAPTION>
INVESTMENT INCOME
<S> <C>
Income:
Interest................................................................................ $ 13,110,032
------------
Expenses: (Note 2)
Investment management fee............................................................... 1,056,970
Administration Fee...................................................................... 677,740
Distribution fee (Class A).............................................................. 577,506
Custodian expenses...................................................................... 49,604
Shareholder servicing and related shareholder expenses.................................. 139,571
Legal, compliance and filing fees....................................................... 59,251
Audit and accounting.................................................................... 101,432
Directors' fees......................................................................... 13,271
Other................................................................................... 14,709
------------
Total expenses........................................................................ 2,690,054
Expenses paid indirectly.............................................................. ( 3,762)
------------
Net expenses.......................................................................... 2,686,292
------------
Net investment income....................................................................... 10,423,740
</TABLE>
<TABLE>
<CAPTION>
REALIZED GAIN (LOSS) ON INVESTMENTS
<S> <C>
Net realized gain (loss) on investments..................................................... ( 41,138)
------------
Increase in net assets from operations...................................................... $ 10,382,602
============
</TABLE>
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See Notes to Financial Statements.
<PAGE>
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DAILY TAX FREE INCOME FUND, INC.
STATEMENTS OF CHANGES IN NET ASSETS
===============================================================================
<TABLE>
<CAPTION>
Six Months
Ended Year
April 30, 1996 Ended
(Unaudited) October 31, 1995
--------- ----------------
INCREASE (DECREASE) IN NET ASSETS
<S> <C> <C>
Operations:
Net investment income......................................... $ 10,423,740 $ 22,594,489
Net realized gain (loss) on investments....................... ( 41,138) 165,639
--------------- ---------------
Increase in net assets from operations........................ 10,382,602 22,760,128
Dividends to shareholders from net investment income
Class A....................................................... ( 7,236,473)* ( 17,048,352)*
Class B....................................................... ( 3,187,267)* ( 5,546,137)*
Capital share transactions (Note 3)
Class A....................................................... ( 18,487,248) ( 82,290,952)
Class B....................................................... 147,050,622 24,655,030
--------------- ---------------
Total increase (decrease)................................. 128,522,236 ( 57,470,283)
Net assets:
Beginning of period........................................... 625,641,906 683,112,189
--------------- ---------------
End of period................................................. $ 754,164,142 $ 625,641,906
=============== ===============
* Designated as exempt-interest dividends for federal income tax purposes.
</TABLE>
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See Notes to Financial Statements.
<PAGE>
- -------------------------------------------------------------------------------
DAILY TAX FREE INCOME FUND, INC.
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
===============================================================================
1. Summary of Accounting Policies.
Daily Tax Free Income Fund, Inc. is a no-load, diversified, open-end management
investment company registered under the Investment Company Act of 1940. The Fund
is a short term, tax exempt money market fund. The Fund has two classes of stock
authorized, Class A and Class B. The Class A shares are subject to a service fee
pursuant to the Distribution and Service Plan. The Class B shares are not
subject to a service fee. In all other respects, the Class A and Class B shares
represent the same interest in the income and assets of the Fund. Distribution
of Class B shares commenced November 23, 1992. The Fund's financial statements
are prepared in accordance with generally accepted accounting principles for
investment companies as follows:
a) Valuation of Securities -
Investments are valued at amortized cost. Under this valuation method, a
portfolio instrument is valued at cost and any discount or premium is
amortized on a constant basis to the maturity of the instrument. The
maturity of variable rate demand instruments is deemed to be the longer of
the period required before the Fund is entitled to receive payment of the
principal amount or the period remaining until the next interest rate
adjustment.
b) Federal Income Taxes -
It is the Fund's policy to comply with the requirements of the Internal
Revenue Code applicable to regulated investment companies and to distribute
all of its tax exempt and taxable income to its shareholders. Therefore, no
provision for federal income tax is required.
c) Dividends and Distributions -
Dividends from investment income (excluding capital gains and losses, if
any, and amortization of market discount) are declared daily and paid
monthly. Distributions of net capital gains, if any, realized on sales of
investments are made after the close of the Fund's fiscal year, as declared
by the Fund's Board of Directors.
d) Use of Estimates -
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that effect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of increases and decreases in
net assets from operations during the reporting period. Actual results
could differ from those estimates.
e) General -
Securities transactions are recorded on a trade date basis. Interest income
is accrued as earned. Realized gains and losses from securities
transactions are recorded on the identified cost basis.
2. Investment Management Fees and Other Transactions with Affiliates.
Under the Investment Management Contract, the Fund pays an investment management
fee to Reich & Tang Asset Management L.P. (Manager) at the annual rate of .325%
of the Fund's average daily net assets not in excess of $750 million plus .30%
of such assets in excess of $750 million. The Manager is required to reimburse
the Fund for its expenses (exclusive of interest, taxes, brokerage, and
extraordinary expenses) to the extent that such expenses, including the
investment management and the shareholder servicing and administration fees, for
any fiscal year exceed the lesser of (i) 1 1/2% of the Fund's average net assets
or (ii) the limits on investment company expenses prescribed by any state in
which the Fund's shares are qualified for sale. No such reimbursement was
required for the period ended April 30, 1996.
- -------------------------------------------------------------------------------
<PAGE>
- -------------------------------------------------------------------------------
===============================================================================
2. Investment Management Fees and Other Transactions with Affiliates
(Continued).
Pursuant to an Administrative Services Agreement, the Fund pays to the Manager
an annual fee of .21% of the Fund's average daily net assets of $1.25 billion,
plus .20% of such assets in excess of $1.25 billion but not in excess of $1.5
billion, plus .19% of such assets in excess of $1.5 billion. Prior to December
1, 1995, the administration fee was .20%, .19% and .18%.
The Manager is a wholly-owned subsidiary of New England Investment Companies,
L.P. ("NEIC"). On August 16, 1995, New England Mutual Life Insurance Company
("The New England"), the owner of NEIC's general partner and a majority owner of
the limited partnership interest in NEIC, entered into an agreement to merge
with Metropolitan Life Insurance Company ("MetLife"), with MetLife to be the
survivor of the merger. The merger is subject to several conditions, including
the required approval, by shareholders of the Fund of a proposed new investment
advisory agreement, intended to take effect at the time of the merger. The new
agreement will be substantially similar to the existing agreement.
Pursuant to a Distribution and Service Plan adopted under Securities and
Exchange Commission Rule 12b-1, the Fund and Reich & Tang Distributors L.P. (the
Distributor) entered into a Distribution Agreement and a Shareholder Servicing
Agreement, only with respect to the Class A shares of the Fund. For its services
under the Shareholder Servicing Agreement, the Distributor receives from the
Fund with respect only to the Class A shares, a fee equal to .25% of the Fund's
average daily net assets.
Fees are paid to Directors who are unaffiliated with the Manager on the basis of
$6,000 per annum plus $750 per meeting attended.
Included in the Statement of Operations under the caption "Shareholder servicing
and related shareholder expenses" are fees of $29,039 paid to Reich & Tang
Services L.P., an affiliate of the Manager as servicing agent for the Fund.
Also, included under this caption are expense offsets of $3,762.
3. Capital Stock.
At April 30, 1996, 20,000,000,000 shares of $.001 par value stock were
authorized and capital paid in amounted to $754,111,280. Transactions in capital
stock, all at $1.00 per share, were as follows:
<TABLE>
<CAPTION>
Six Months Year
Ended Ended
April 30, 1996 October 31, 1995
-------------- ----------------
Class A
<S> <C> <C>
Sold 791,633,456 2,061,020,405
Issued on reinvestment of dividends....... 6,162,139 14,036,481
Redeemed.................................. ( 816,282,843) (2,157,347,838)
------------- --------------
Net increase (decrease)................... ( 18,487,248) ( 82,290,952)
============= ==============
Class B
Sold...................................... 741,038,124 1,126,403,552
Issued on reinvestment of dividends....... 2,913,485 5,123,928
Redeemed.................................. ( 596,900,987) (1,106,872,450)
-------------- --------------
Net increase (decrease)................... 147,050,622 24,655,030
============== ==============
</TABLE>
4. Sales of Securities.
Accumulated undistributed realized gains at April 30, 1996 amounted to $52,862.
- -------------------------------------------------------------------------------
<PAGE>
- -------------------------------------------------------------------------------
DAILY TAX FREE INCOME FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
(UNAUDITED)
===============================================================================
5. Selected Financial Information.
<TABLE>
<CAPTION>
Year Ended October 31,
------------------------------------------------------------
Six Months
Ended
April 30, 1996 1995 1994 1993
------------------ ------------------ ------------------ -----------------
Class A Class B Class A Class B Class A Class B Class A Class B
------- ------- ------- ------- ------- ------- ------- -------
Per Share Operating Performance:
(for a share outstanding throughout the period)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------- ------- ------- ------- ------- ------- ------- -------
Income from investment operations:
Net investment income 0.016 0.017 0.034 0.037 0.023 0.026 0.022 0.023
Less distributions:
Dividends from net investment
income....................................... ( 0.016) ( 0.017) ( 0.034) ( 0.037) ( 0.023) ( 0.026) ( 0.022) ( 0.023)
------- ------- ------- ------- ------- ------- ------- -------
Net asset value, end of period .............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======= ======= ======= ======= ======= ======= ======= =======
Total Return................................. 3.18%* 3.43%* 3.46% 3.71% 2.35% 2.60% 2.24% 2.49%*
Ratios/Supplemental Data
Net assets, end of period (000) ............. $440,427 $313,737 $458,942 $166,700 $541,106 $142,006 $606,497 $137,248
Ratios to average net assets:
Expenses.................................... 0.90%*+ 0.65%*+ 0.89%+ 0.64%+ 0.88% 0.63% 0.90% 0.65%*
Net investment income ...................... 3.13%*+ 3.38%*+ 3.41%+ 3.66%+ 2.31% 2.56% 2.22% 2.45%*
* Annualized
+ Includes custodian fees paid indirectly.
<CAPTION>
Year Ended October 31,
-----------------------
1992 1991
--------- ---------
Per Share Operating Performance:
(for a share outstanding throughout the period
<S> <C> <C>
Net asset value, beginning of period
$ 1.00 $ 1.00
Income from investment operations: ------- -------
Net investment income
Less distributions: 0.029 0.045
Dividends from net investment
income.......................................
( 0.029) ( 0.045)
Net asset value, end of period .............. ------- -------
$ 1.00 $ 1.00
Total Return................................. ======= =======
Ratios/Supplemental Data 2.98% 4.64%
Net assets, end of period (000) .............
Ratios to average net assets: $666,484 $678,486
Expenses.................................... 0.82% 0.79%
Net investment income ...................... 2.94% 4.53%
* Annualized
+ Includes custodian fees paid indirectly.
</TABLE>
- -------------------------------------------------------------------------------
<PAGE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
This report is submitted for the general information of the shareholders of the
Fund. It is not authorized for distribution to prospective investors in the Fund
unless preceded or accompanied by an effective prospectus, which includes
information regarding the Fund's objectives and policies, experience of its
management, marketability of shares, and other information.
- -------------------------------------------------------------------------------
Daily Tax Free Income Fund, Inc.
600 Fifth Avenue
New York, New York 10020
Manager
Reich & Tang Asset Management L.P.
600 Fifth Avenue
New York, New York 10020
Custodian, Transfer Agent
& Dividend Disbursing Agent
Investors Fiduciary Trust Company
127 West 10th Street
Kansas City, Missouri 64105
- -------------------------------------------------------------------------------
