SCOUT
MONEY MARKET
FUND
A no-load mutual fund
with primary emphasis
on maximum income
consistent with safety
of principal and
maintenance of liquidity.
Quarterly Report
September 30, 1997
TO THE SHAREHOLDERS
Scout Money Market Fund's Federal Portfolio earned 1.27% for the quarter ended
September 30, 1997, while the Prime Portfolio earned 1.29%. The 7-day current
yield on September 30, 1997, was 5.07% for the Federal Portfolio and 5.11% for
the Prime Portfolio.
Money market funds are neither insured nor guaranteed by the U.S. Government.
There is no assurance that the fund will maintain a stable net asset value of
one dollar per share.
Spurred by plenty of good economic news and the Federal Reserve's decision not
to raise interest rates, the fixed income markets performed very well in the
quarter. This was particularly notable in the 30-year Treasury bond, which had
done nothing (up 0.54%) in the first six months of the year but had an
outstanding quarterly return of 6.29%. While the rally continued in early
October, based mainly on a favorable employment report, the long bond closed
the quarter below 6.25%. We believe the bond is now trading at the low end of
a 6.25%-6.75% range. Given any evidence of strength in the economy, it easily
could revert to the higher end of this range.
The money markets remained focused on the Fed, and of course felt no impact
from the bond activity. As long as the Fed does nothing, money markets will
continue to trade off of the Fed Funds rate, now at 5.50%. Seasonal corporate
or government requirements may temporarily drive rates substantially above or
below that level, but for the most part they will remain centered there. In
addition, the yield curve on one- through six-month maturities is essentially
flat and probably will remain so until the market again anticipates rate
increases.
We appreciate your continued interest in Scout Money Market Fund and we
welcome your comments and questions.
Sincerely,
/s/William A. Faust
William A. Faust
UMB Investment Advisors
GRAPH - TAXABLE YIELD CURVES
Shares of the Scout Funds are not deposits or obligations of, nor guaranteed
by, UMB Bank, n.a. or any other banking institution, nor are they insured by
the Federal Deposit Insurance Corporation or any other deposit insurance.
These shares involve investment risks, including the possible loss of the
principal amount invested.
FINANCIAL STATEMENTS
Statement of Net Assets
September 30, 1997
Principal Market
Amount Description Value
PRIME PORTFOLIO
SHORT-TERM CORPORATE NOTES - 96.08%
$ 15,000,000 Abbott Laboratories,
5.47%, due October 2, 1997 $ 14,997,721
5,300,000 Air Products & Chemicals,
5.50%, due December 31, 1997 5,226,315
7,660,000 American Greetings Co.,
5.50%, due October 16, 1997 7,642,446
13,000,000 American Greetings Co.,
5.50%, due October 21, 1997 12,960,278
15,000,000 Ameritech Capital Funding Corp.,
5.47%, due October 17, 1997 14,963,533
2,642,000 Archer-Daniels-Midland Co.,
5.50%, due October 10, 1997 2,638,367
5,000,000 Archer-Daniels-Midland Co.,
5.49%, due October 20, 1997 4,985,513
10,000,000 Archer-Daniels-Midland Co.,
5.52%, due October 23, 1997 9,966,267
5,000,000 Archer-Daniels-Midland Co.,
5.52%, due October 27, 1997 4,980,067
15,000,000 American Tel. & Telegraph,
5.47%, due October 8, 1997 14,984,046
15,000,000 Atlantic Richfield Co.,
5.48%, due October 15, 1997 14,968,033
5,000,000 Atlantic Richfield Co.,
5.49%, due October 15, 1997 4,989,325
2,200,000 Atlantic Richfield Co.,
5.52%, due October 15, 1997 2,195,277
5,800,000 BellSouth Telecommunications,
5.47%, due October 9, 1997 5,792,950
15,000,000 BellSouth Telecommunications,
5.48%, due October 24, 1997 14,947,483
7,500,000 Campbell Soup Co.,
5.48%, due November 7, 1997 7,457,758
8,000,000 Disney Walt Co.,
5.52%, due October 10, 1997 7,988,960
1,500,000 Donnelly & Co. (R. R.),
5.51%, due October 7, 1997 1,498,622
2,275,000 Donnelly & Co. (R. R.),
5.51%, due October 14, 1997 2,270,474
15,000,000 Dover Corp.,
5.49%, due October 20, 1997 14,956,538
3,200,000 Dover Corp.,
5.55%, due October 22, 1997 3,189,640
2,071,000 Duke Energy Co.,
6.37%, due October 1, 1997 2,071,000
16,525,000 Duke Energy Co.,
5.48%, due October 14, 1997 16,492,299
3,000,000 Duke Energy Co.,
5.50%, due October 14, 1997 2,994,042
10,000,000 Dun & Bradstreet Corp.,
5.51%, due October 3, 1997 9,996,939
2,500,000 Dun & Bradstreet Corp.,
5.51%, due October 7, 1997 2,497,704
1,205,000 Dun & Bradstreet Corp.,
5.55%, due October 14, 1997 1,202,585
6,000,000 Dun & Bradstreet Corp.,
5.53%, due December 3, 1997 5,941,935
15,000,000 duPont (E.I.) deNemours & Co.,
5.48%, due October 9, 1997 14,981,733
12,500,000 Eastman Kodak Co.,
5.49%, due October 6, 1997 12,490,469
4,000,000 Eastman Kodak Co.,
5.47%, due October 7, 1997 3,996,353
5,000,000 Eastman Kodak Co.,
5.49%, due October 14, 1997 4,990,087
7,500,000 Emerson Electric Co.,
5.47%, due October 6, 1997 7,494,302
10,000,000 Gannett, Inc.,
5.48%, due October 7, 1997 9,990,867
15,000,000 General Mills, Inc.,
5.47%, due October 22, 1997 14,952,137
5,000,000 General Mills, Inc.,
5.47%, due October 31, 1997 4,977,208
10,000,000 General Re Corp.,
5.48%, due October 3, 1997 9,996,956
20,000,000 Gillette Co.,
5.48%, due October 16, 1997 19,954,333
10,000,000 Heinz H. J. Co.,
5.50%, due October 23, 1997 9,966,389
5,000,000 Heinz H. J. Co.,
5.49%, due October 24, 1997 4,982,462
5,000,000 Heinz H. J. Co.,
5.52%, due November 3, 1997 4,974,700
5,000,000 International Business Machines Corp.,
Medium Term Notes,
5.65%, due January 22, 1998 4,998,514
10,700,000 Kellogg Co.,
5.48%, due October 1, 1997 10,700,000
1,200,000 Kellogg Co.,
5.50%, due October 28, 1997 1,195,050
1,600,000 Kellogg Co.,
5.50%, due October 30, 1997 1,592,911
9,000,000 Laclede Gas Co.,
5.53%, due October 21, 1997 8,972,350
2,500,000 Laclede Gas Co.,
5.54%, due October 21, 1997 2,492,306
3,210,000 Laclede Gas Co.,
5.55%, due October 17, 1997 3,202,082
3,170,000 Laclede Gas Co.,
5.52%, due October 23, 1997 3,159,307
4,500,000 Laclede Gas Co.,
5.53%, due October 29, 1997 4,480,645
10,598,000 Monsanto Co.,
5.49%, due October 10, 1997 10,583,454
5,000,000 Motorola Inc.,
5.47%, due October 3, 1997 4,998,481
10,000,000 Motorola Inc.,
5.50%, due October 23, 1997 9,966,389
10,000,000 Nalco Chemical Co.,
5.50%, due October 2, 1997 9,998,472
2,500,000 Nalco Chemical Co.,
5.58%, due October 23, 1997 2,491,475
2,500,000 PepsiCo Inc.,
5.50%, due October 1, 1997 2,500,000
7,700,000 PepsiCo Inc.,
5.51%, due October 1, 1997 7,700,000
5,500,000 PepsiCo Inc.,
5.49%, due October 6, 1997 5,495,806
14,250,000 Philip Morris Cos. Inc.,
6.30%, due October 1, 1997 14,250,000
2,000,000 Progress Capital Holdings Inc.,
5.53%, due October 6, 1997 1,998,464
6,500,000 Progress Capital Holdings Inc.,
5.49%, due October 9, 1997 6,492,070
6,400,000 Weyerhauser Co.,
5.48%, due October 7, 1997 6,394,155
2,500,000 Wisconsin Electric Power Co.,
5.52%, due October 30, 1997 2,488,883
1,900,000 Wisconsin Electric Power Co.,
5.52%, due November 6, 1997 1,889,512
5,000,000 Xerox Corp.,
5.50%, due October 20, 1997 4,985,486
13,000,000 Xerox Corp.,
5.50%, due October 27, 1997 12,948,361
485,606,000 484,518,286
GOVERNMENT SPONSORED ENTERPRISES -3.27%
2,500,000 Federal Farm Credit Banks
Discount Notes,
5.69%, due October 1, 1997 2,500,000
5,000,000 Federal Farm Credit Banks
Discount Notes,
5.51%, due December 1, 1997 5,000,000
5,000,000 Federal Farm Credit Banks
Discount Notes,
5.50%, due January 2, 1998 5,000,000
4,000,000 Federal National Mortgage Association
Discount Notes,
5.42%, due October 7, 1997 3,996,387
16,500,000 16,496,387
REPURCHASE AGREEMENT - 2.43%
12,275,000 Lehman Tri-Party Repo.,
6.00%, due October 1, 1997
(collateralized by Federal
National Mortgage Association Note,
due April 1, 2027) 12,275,000
TOTAL INVESTMENTS - 101.78% $ 513,289,673
Other assets less liabilities - (1.78%) (8,990,844)
TOTAL NET ASSETS - 100.00%
(equivalent to $1.00 per share;
750,000,000 shares of $0.01 par value
capital shares authorized;
504,328,514 shares outstanding) $ 504,298,829
Valuation of securities is on the basis of amortized cost, which approximates
market value.
FEDERAL PORTFOLIO
GOVERNMENT SPONSORED ENTERPRISES - 89.07%
$ 7,500,000 Federal Farm Credit Banks,
5.69%, due October 1, 1997 $ 7,500,000
5,000,000 Federal Farm Credit Banks,
5.50%, due November 3, 1997 5,000,000
5,000,000 Federal Farm Credit Banks,
5.51%, due December 1, 1997 5,000,000
2,500,000 Federal Farm Credit Banks,
5.50%, due January 2, 1998 2,500,000
4,531,000 Federal Home Loan Banks Discount Note,
5.40%, due October 1, 1997 4,531,000
8,100,000 Federal Home Loan Banks Discount Note,
5.425%, due October 15, 1997 8,082,911
7,500,000 Federal Home Loan Banks Discount Note,
5.39%, due January 9, 1998 7,387,708
2,147,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.41%, due October 1, 1997 2,147,000
2,215,000 Federal Home Loan Mortgage Corporation
Discount Notes, 5.40%,
due October 2, 1997 2,214,668
6,000,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.50%, due October 2, 1997 5,999,083
8,211,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.41%, due October 3, 1997 8,208,532
10,000,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.41%, due October 6, 1997 9,992,486
14,740,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.51%, due October 6, 1997 14,728,720
1,165,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.40%, due October 10, 1997 1,163,428
7,075,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.41%, due October 10, 1997 7,065,431
11,275,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.42%, due October 10, 1997 11,259,722
2,600,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.45%, due October 10, 1997 2,596,458
10,000,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.42%, due October 14, 1997 9,980,428
6,785,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.425%, due October 14, 1997 6,771,708
20,000,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.40%, due October 15, 1997 19,958,000
5,700,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.46%, due October 31, 1997 5,674,065
7,500,000 Federal National Mortgage Association
Discount Notes,
5.60%, due October 2, 1997 7,498,833
11,000,000 Federal National Mortgage Association
Discount Notes,
5.42%, due October 7, 1997 10,990,063
3,590,000 Federal National Mortgage Association
Discount Notes,
5.40%, due October 9, 1997 3,585,692
5,000,000 Federal National Mortgage Association
Discount Notes,
5.42%, due October 9, 1997 4,993,978
10,000,000 Federal National Mortgage Association
Discount Notes,
5.42%, due October 14, 1997 9,980,428
15,000,000 Federal National Mortgage Association
Discount Notes,
5.40%, due October 16, 1997 14,966,250
3,570,000 Federal National Mortgage Association
Discount Notes,
5.50%, due October 16, 1997 3,561,819
20,000,000 Federal National Mortgage Association
Discount Notes,
5.40%, due October 17, 1997 19,952,000
5,000,000 Federal National Mortgage Association
Discount Notes,
5.46%, due October 20, 1997 4,985,592
10,000,000 Federal National Mortgage Association
Discount Notes,
5.40%, due October 24, 1997 9,965,500
2,500,000 Federal National Mortgage Association
Discount Notes,
5.40%, due November 10, 1997 2,485,000
241,204,000 240,726,503
REPURCHASE AGREEMENT - 12.12%
$ 32,750,000 Lehman Tri-Party Repo.,
6.00%, due October 1, 1997
(collateralized by Federal National Mortgage
Association Note, due April 1, 2027) $ 32,750,000
TOTAL INVESTMENTS - 101.19% $ 273,476,503
Other assets less liabilities - (1.19%) (3,222,494)
TOTAL NET ASSETS - 100.00%
(equivalent to $1.00 per share;
750,000,000 shares of $0.01 par value
capital shares authorized;
270,302,133 shares outstanding) $ 270,254,009
Valuation of securities is on the basis of amortized cost, which approximates
market value.
This report has been prepared for the information of the Shareholders of
Scout Money Market Fund, Inc., and is not to be construed as an
offering of the shares of the Fund. Shares of this Fund and of the other
Scout Funds are offered only by the Prospectus, a copy of which may be
obtained from Jones & Babson, Inc.
BOARD OF DIRECTORS
AND OFFICERS
Board of Directors
Larry D. Armel
William E. Hoffman, D.D.S.
Eric T. Jager
Stephen F. Rose
Stuart Wien
Officers
Larry D. Armel, President
P. Bradley Adams, Vice President & Treasurer
Michael A. Brummel, Vice President
Martin A. Cramer, Vice President & Secretary
John G. Dyer, Vice President
Constance E. Martin, Vice President
Investment Counsel
UMB Bank, n.a., Kansas City, Missouri
Auditors
Baird, Kurtz & Dobson, Kansas City, Missouri
Legal Counsel
Stradley, Ronon, Stevens & Young,
Philadelphia, Pennsylvania
John G. Dyer, Kansas City, Missouri
Custodian
UMB Bank, n.a., Kansas City, Missouri
JONES & BABSON
MUTUAL FUNDS
P.O. Box 410498
Kansas City, MO 64141-0498
TOLL-FREE 1-800-996-2862
JB24C
