UMB SCOUT FUNDS
MONEY MARKET FUND
Semiannual Report December 31, 1998
A no-load mutual fund with primary emphasis
on maximum income consistent with safety
of principal and maintenance of liquidity.
TO THE SHAREHOLDERS
UMB Scout Money Market Fund's Federal Portfolio earned 1.17% for the quarter
ended December 31, 1998, while the Prime Portfolio earned 1.21%. The 7-day
current yield on that date was 4.55% for the Federal Portfolio and 4.81% for
the Prime Portfolio. For the calendar year, the Federal Portfolio returned
5.04% and the Prime Portfolio returned 5.14%. The Fund invests in high-
quality short-term debt instruments and seeks maximum income consistent with
safety of principal and liquidity.
An investment in the Fund is not insured or guaranteed by the Federal Deposit
Insurance Corporation or any other government agency. Although the fund seeks
to preserve the value of your investment at $1.00 per share, it is possible
to lose money by investing in the Fund.
The Federal Reserve was active late in 1998, cutting the key Fed Funds
interest rate in late September, mid-October and again in mid-November. This
series of moves ultimately took the rate down to 4.75%.
The interest rate cuts were prompted by ongoing economic trouble in Russia,
Japan and various Pacific Rim and Latin American countries, and they took a
toll on domestic interest rates. By the end of the quarter, the 30-day yield
of the Federal Portfolio had dropped to 4.53% from 5.03%, and of the Prime
Portfolio to 4.70% from 5.10%.
As we enter the last year of this decade, it is appropriate to note that we
are in the longest peacetime expansion in U.S. history. During the past nine
years, economists consistently have been unable to accurately predict the
rate of growth in the U.S. economy. The debate continues again this year,
with most economists predicting slow growth for 1999 in spite of data showing
that the economy is doing just fine. In our judgment, the Fed will listen to
the data and will postpone any further interest rate cuts until the second
calendar quarter or later.
We appreciate your continued interest in the UMB Scout Money Market Fund and
we welcome your comments and questions.
Sincerely,
/s/William A. Faust
William A. Faust
UMB Investment Advisors
Chart - Fund Diversification - Federal Portfolio (UMFXX)
Agencies 98%
Other 2%
As of December 31, 1998, Statement of Assets. Subject to Change.
Chart - Fund Diversification - Prime Portfolio (UMPXX)
Commerical Paper 98%
Government
& Agency 7%
As of December 31, 1998, Statement of Assets. Subject to Change.
Shares of the UMB 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 ("FDIC"). These shares
involve investment risks, including the possible loss of the principal
invested.
FINANCIAL STATEMENTS DECEMBER 31, 1998 (unaudited)
STATEMENT OF NET ASSETS
FACE MARKET
AMOUNT DESCRIPTION VALUE
PRIME PORTFOLIO
SHORT-TERM CORPORATE NOTES - 94.11%
$ 1,665,000 Abbott Laboratories,
5.45%, due January 12, 1999 $ 1,662,227
8,000,000 Aluminum Company of America,
5.30%, due January 8, 1999 7,991,756
1,167,000 Aluminum Company of America,
5.40%, due January 15, 1999 1,164,549
10,920,000 Aluminum Company of America,
5.20%, due January 22, 1999 10,886,876
10,000,000 Aluminum Company of America,
5.14%, due January 25, 1999 9,965,733
7,500,000 Amgen Inc.,
5.25%, due January 12, 1999 7,487,969
10,000,000 Amgen Inc.,
5.25%, due January 19, 1999 9,973,750
6,400,000 Amgen Inc.,
5.45%, due January 26, 1999 6,375,778
1,500,000 Anheuser-Busch Cos Inc.,
5.10%, due January 4, 1999 1,499,362
2,500,000 Archer-Daniels-Midland Co.,
5.00%, due January 20, 1999 2,493,403
3,370,000 Archer-Daniels-Midland Co.,
5.50%, due February 8, 1999 3,350,435
5,000,000 Arco British Ltd.,
5.24%, due January 12, 1999 4,991,994
15,000,000 Arco British Ltd.,
5.25%, due January 13, 1999 14,973,750
5,000,000 Atlantic Richfield Co.,
5.00%, due February 17, 1999 4,967,361
2,000,000 Becton, Dickenson,
5.17%, due January 8, 1999 1,997,989
10,000,000 Becton, Dickenson,
5.15%, due January 21, 1999 9,971,389
6,200,000 Becton, Dickenson,
5.18%, due January 25, 1999 6,178,589
2,575,000 Becton, Dickenson,
5.10%, due February 26, 1999 2,554,572
8,275,000 Bell Atlantic Network Funding,
5.90%, due January 5, 1999 8,269,575
2,500,000 BellSouth Telecommunications,
5.00%, due January 20, 1999 2,493,403
3,948,000 BellSouth Telecommunications,
5.35%, due January 26, 1999 3,933,332
5,000,000 BellSouth Telecommunications,
5.20%, due February 4, 1999 4,975,444
5,000,000 California Pollution Control Revenue,
5.10%, due January 5, 1999 5,000,000
9,000,000 California Pollution Control Revenue,
5.30%, due February 3, 1999 9,000,000
10,000,000 Chevron USA Inc.,
5.30%, due January 7, 1999 9,991,167
11,000,000 Coca-Cola Co.,
5.12%, due January 19, 1999 10,971,840
7,500,000 Deere and Co.,
5.25%, due January 12, 1999 7,487,969
7,500,000 Dover Corp.,
5.21%, due January 6, 1999 7,494,573
3,000,000 Dover Corp.,
5.55%, due January 20, 1999 2,991,212
10,000,000 Dover Corp.,
5.45%, due January 25, 1999 9,963,667
9,500,000 Dover Corp.,
5.47%, due February 2, 1999 9,453,809
5,000,000 Duke Energy Co.,
5.33%, due January 27, 1999 4,980,753
15,000,000 duPont (E.I.) deNemours & Co.,
5.21%, due January 14, 1999 14,971,779
5,000,000 duPont (E.I.) deNemours & Co.,
5.23%, due January 14, 1999 4,990,557
5,000,000 Eastman Kodak Co.,
5.28%, due January 15, 1999 4,989,733
5,000,000 Eastman Kodak Co.,
5.08%, due January 19, 1999 4,987,300
12,500,000 Eastman Kodak Co.,
5.12%, due January 21, 1999 12,464,444
7,000,000 Emerson Electric Co.,
5.33%, due January 11, 1999 6,989,636
8,500,000 Emerson Electric Co.,
5.40%, due January 11, 1999 8,466,850
10,000,000 Gannett Inc.,
5.16%, due January 27, 1999 9,979,933
2,500,000 General Mills Inc.,
5.08%, due January 4, 1999 2,498,942
2,200,000 General Mills Inc.,
5.25%, due January 4, 1999 2,199,037
1,259,000 General Mills Inc.,
5.25%, due January 5, 1999 1,258,266
14,000,000 General Mills Inc.,
5.08%, due January 8, 1999 13,986,171
2,500,000 General Mills Inc.,
5.12%, due January 12, 1999 2,496,089
3,492,000 Gillette Co.,
6.00%, due January 5, 1999 3,489,672
5,000,000 Halliburton Co.,
5.30%, due January 5, 1999 4,997,056
10,000,000 Halliburton Co.,
5.35%, due February 5, 1999 9,947,986
2,500,000 Halliburton Co.,
5.04%, due February 24, 1999 2,481,100
2,810,000 Heinz H. J. Co.,
5.40%, due January 25, 1999 2,799,884
2,500,000 Heinz H. J. Co.,
5.06%, due February 2, 1999 2,488,756
1,500,000 Heinz H. J. Co.,
5.25%, due February 5, 1999 1,492,344
25,000,000 International Business Machines Corp.,
5.25%, due January 6, 1999 24,981,771
5,000,000 International Business Machines Corp.,
5.15%, due January 19, 1999 4,987,125
8,785,000 Kellogg Co.,
5.15%, due Janaury 20, 1999 8,761,122
5,000,000 Laclede Gas Co.,
5.20%, due January 7, 1999 4,995,667
2,000,000 Laclede Gas Co.,
5.75%, due January 12, 1999 1,996,486
5,000,000 Laclede Gas Co.,
5.18%, due January 14, 1999 4,990,647
5,000,000 Laclede Gas Co.,
5.18%, due February 3, 1999 4,976,258
15,000,000 Lucent Technologies Inc.,
5.05%, due January 4, 1999 14,993,687
12,500,000 Lucent Technologies Inc.,
5.23%, due January 7, 1999 12,489,104
2,900,000 Lucent Technologies Inc.,
5.22%, due February 5, 1999 2,885,283
20,000,000 Marsh & McLennan Cos Inc.,
5.39%, due January 11, 1999 19,970,056
10,000,000 Marsh & McLennan Cos Inc.,
5.30%, due January 15, 1999 9,979,389
1,000,000 Minnesota Mining and Manufacturing Co.,
5.10%, due January 26, 1999 996,458
2,000,000 Pepsico Inc.,
5.00%, due January 11, 1999 1,997,222
10,000,000 Pepsico Inc.,
5.10%, due January 13, 1999 9,983,000
5,000,000 Pepsico Inc.,
5.25%, due January 26, 1999 4,981,771
1,100,000 Pepsico Inc.,
5.27%, due January 26, 1999 1,095,974
6,500,000 Pepsico Inc.,
5.27%, due January 27, 1999 6,475,260
20,000,000 Procter & Gamble Co.,
5.18%, due January 29, 1999 19,919,422
8,500,000 Progress Capital Holdings Inc.,
5.15%, due January 22, 1999 8,474,465
4,000,000 Progress Capital Holdings Inc.,
5.25%, due January 26, 1999 3,985,417
10,000,000 Progress Capital Holdings Inc.,
5.30%, due January 26, 1999 9,963,194
3,200,000 Progress Capital Holdings Inc.,
5.35%, due February 5, 1999 3,183,356
6,000,000 Sara Lee Corp.,
5.10%, due January 4, 1999 5,997,450
7,000,000 Snap On Inc.,
5.80%, due January 4, 1999 6,996,617
20,000,000 South Carolina Electric Gas,
5.28%, due January 28, 1999 19,920,800
7,000,000 South Carolina Electric Gas,
5.37%, due January 29, 1999 6,970,763
1,800,000 South Carolina Electric Gas,
5.45%, due February 5, 1998 1,790,463
5,500,000 Times Mirror Co.,
5.25%, due January 28, 1999 5,478,344
10,000,000 Times Mirror Co.,
5.12%, due February 2, 1999 9,954,489
4,000,000 Wisconsin Electric Power Co.,
5.15%, due January 19, 1999 3,989,700
15,000,000 Wisconsin Electric Power Co.,
5.25%, due February 1, 1999 14,932,187
4,000,000 Wisconsin Electric Power Co.,
5.25%, due February 5, 1999 3,979,583
12,500,000 Xerox Overseas Holding PLC,
5.04%, due January 5, 1999 12,493,000
2,500,000 Xerox Overseas Holding PLC,
5.24%, due January 12, 1999 2,495,997
605,531,289
GOVERNMENT SPONSORED ENTERPRISES - 6.83%
5,000,000 Federal Home Loan Banks Discount Notes,
5.00%, due October 27, 1999 5,000,000
3,000,000 Federal Home Loan Banks Discount Notes,
5.25%, due November 12, 1999 3,000,000
1,078,000 Federal Home Loan Mortgage Corp. Discount Notes,
4.96%, due January 8, 1999 1,076,960
5,000,000 Federal Home Loan Mortgage Corp. Discount Notes,
5.08%, due January 20, 1999 4,986,595
7,000,000 Federal Home Loan Mortgage Corp. Discount Notes,
5.08%, due February 3, 1999 6,967,403
5,000,000 Federal Home Loan Mortgage Corp. Discount Notes,
5.06%, due February 10, 1999 4,971,889
5,500,000 Federal Home Loan Mortgage Corp. Discount Notes,
5.03%, due February 26, 1999 5,456,966
7,500,000 Federal National Mortgage Association Discount
Notes, 5.00%, due January 4, 1999 7,496,875
5,000,000 Federal National Mortgage Association Discount
Notes, 5.54%, due July 16, 1999 4,999,060
43,955,748
TOTAL INVESTMENTS - 100.94% $ 649,487,037
Other assets less liabilities - (0.94)% (6,088,826)
TOTAL NET ASSETS - 100.00%
(equivalent to $1.00 per share; 750,000,000 shares of $0.01
par value capital shares authorized; 643,427,624 shares
outstanding) $ 643,398,211
Valuation of securities is on the basis of amortized cost, which approximates
market value.
See accompanying Notes to Financial Statements.
FEDERAL PORTFOLIO
GOVERNMENT SPONSORED ENTERPRISES - 97.99%
$ 1,575,000 Federal Agricultural Mortgage Corp.,
4.95%, due January 14, 1999 $ 1,572,185
5,000,000 Federal Agricultural Mortgage Corp.,
5.08%, due January 19, 1999 4,987,300
650,000 Federal Home Loan Banks Discount Note,
5.00%, due January 6, 1999 649,549
2,175,000 Federal Home Loan Banks Discount Note,
5.10%, due January 6, 1999 2,173,459
7,500,000 Federal Home Loan Banks Discount Note,
5.13%, due January 6, 1999 7,494,656
5,000,000 Federal Home Loan Banks Discount Note,
5.00%, due January 8, 1999 4,995,139
4,000,000 Federal Home Loan Banks Discount Note,
5.05%, due January 13, 1999 3,993,267
3,730,000 Federal Home Loan Banks Discount Note,
5.07%, due January 13, 1999 3,723,696
6,557,000 Federal Home Loan Banks Discount Note,
5.08%, due January 13, 1999 6,545,896
2,500,000 Federal Home Loan Banks Discount Note,
5.09%, due January 13, 1999 2,495,758
300,000 Federal Home Loan Banks Discount Note,
5.00%, due January 15, 1999 299,417
3,300,000 Federal Home Loan Banks Discount Note,
5.10%, due January 15, 1999 3,293,455
7,500,000 Federal Home Loan Banks Discount Note,
5.10%, due January 19, 1999 7,480,875
10,000,000 Federal Home Loan Banks Discount Note,
5.12%, due January 20, 1999 9,972,978
3,019,000 Federal Home Loan Banks Discount Note,
5.16%, due January 20, 1999 3,010,778
3,600,000 Federal Home Loan Banks Discount Note,
5.08%, due January 22, 1999 3,589,332
5,000,000 Federal Home Loan Banks Discount Note,
5.11%, due January 22, 1999 4,985,096
1,522,000 Federal Home Loan Banks Discount Note,
5.19%, due January 29, 1999 1,515,856
2,500,000 Federal Home Loan Banks Discount Note,
5.00%, due October 27, 1999 2,500,000
2,000,000 Federal Home Loan Banks Discount Note,
5.25%, due November 12, 1999 2,000,000
1,562,000 Federal Home Loan Mortgage Corporation
Discount Notes,
4.25%, due January 4, 1999 1,561,447
2,500,000 Federal Home Loan Mortgage Corporation
Discount Notes,
4.95%, due January 6, 1999 2,498,281
3,250,000 Federal Home Loan Mortgage Corporation
Discount Notes,
4.96%, due January 6, 1999 3,247,761
5,000,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.05%, due January 8, 1999 4,995,090
10,000,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.12%, due January 8, 1999 9,990,044
4,865,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.08%, due January 11, 1999 4,858,135
10,000,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.09%, due January 11, 1999 9,985,862
11,000,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.10%, due January 11, 1999 10,984,417
2,270,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.08%, due January 13, 1999 2,266,156
270,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.00%, due January 14, 1999 269,512
3,155,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.09%, due January 14, 1999 3,149,201
2,750,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.20%, due January 14, 1999 2,744,836
3,000,000 Federal Home Loan Mortgage Corporation
Discount Notes,
4.95%, due January 15, 1999 2,994,225
2,000,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.09%, due January 15, 1999 1,996,041
16,000,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.10%, due January 15, 1999 15,968,267
3,000,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.07%, due January 20, 1999 2,991,973
12,000,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.08%, due January 20, 1999 11,967,826
10,000,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.10%, due January 21, 1999 9,971,667
6,400,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.09%, due January 22, 1999 6,380,997
661,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.00%, due January 25, 1999 658,797
5,000,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.16%, due January 25, 1999 4,982,800
20,000,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.08%, due January 29, 1999 19,920,978
5,000,000 Federal Home Loan Mortgage Corporation
Discount Notes,
4.81%, due February 2, 1999 4,978,622
3,500,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.11%, due February 3, 1999 3,483,605
6,000,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.06%, due February 10, 1999 5,966,267
5,200,000 Federal Home Loan Mortgage Corporation
Discount Notes,
5.03%, due February 26, 1999 5,159,313
16,849,000 Federal National Mortgage Association
Discount Notes,
5.00%, due January 4, 1999 16,841,980
8,151,000 Federal National Mortgage Association
Discount Notes,
5.08%, due January 4, 1999 8,147,549
10,000,000 Federal National Mortgage Association
Discount Notes,
5.11%, due January 5, 1999 9,994,322
5,190,000 Federal National Mortgage Association
Discount Notes,
4.65%, due January 7, 1999 5,185,978
5,000,000 Federal National Mortgage Association
Discount Notes,
5.08%, due January 7, 1999 4,995,767
5,000,000 Federal National Mortgage Association
Discount Notes,
5.09%, due January 7, 1999 4,995,758
10,000,000 Federal National Mortgage Association
Discount Notes,
5.11%, due January 7, 1999 9,991,483
1,500,000 Federal National Mortgage Association
Discount Notes,
5.20%, due January 7, 1999 1,498,700
100,000 Federal National Mortgage Association
Discount Notes,
5.00%, due January 8, 1999 99,903
10,000,000 Federal National Mortgage Association
Discount Notes,
5.07%, due January 14, 1999 9,981,692
1,000,000 Federal National Mortgage Association
Discount Notes,
5.00%, due January 15, 1999 998,056
2,000,000 Federal National Mortgage Association
Discount Notes,
5.10%, due January 19, 1999 1,994,900
125,000 Federal National Mortgage Association
Discount Notes,
5.00%, due January 26, 1999 124,566
4,065,000 Federal National Mortgage Association
Discount Notes,
4.80%, due February 2, 1999 4,047,656
4,000,000 Federal National Mortgage Association
Discount Notes,
5.54%, due July 16, 1999 3,999,248
314,148,370
TOTAL INVESTMENTS - 97.99% $ 314,148,370
Other assets less liabilities - 2.01% 6,457,727
TOTAL NET ASSETS - 100.00%
(equivalent of $1.00 per share;
750,000,000 shares of $0.01
par value capital shares authorized;
320,654,222 shares outstanding) $ 320,606,097
Valuation of securities is on the basis of amortized cost, which approximates
market value.
See accompanying Notes to Financial Statements.
FINANCIAL STATEMENTS DECEMBER 31, 1998 (unaudited)
STATEMENT OF ASSETS AND LIABILITIES
PRIME FEDERAL
PORTFOLIO PORTFOLIO
ASSETS:
Investment securities, at market value $649,487,037 $314,148,370
Cash (6,407,336) 6,312,411
Interest receivable 248,831 138,636
Total assets 643,328,532 320,599,417
LIABILITIES:
Dividends payable (33,819) 10,303
Disbursements in excess of demand deposit cash (35,860) (16,983)
Total liabilities (69,679) (6,680)
NET ASSETS $643,398,211 $320,606,097
NET ASSETS CONSIST OF:
Capital (capital stock and paid-in capital) $643,431,258 $320,654,882
Accumulated net realized loss on investment
transactions (33,047) (48,785)
NET ASSETS APPLICABLE TO OUTSTANDING SHARES $643,398,211 $320,606,097
Capital shares, $0.01 par value
Authorized 750,000,000 750,000,000
Outstanding 643,427,624 320,654,222
NET ASSET VALUE PER SHARE $ 1.00 $ 1.00
See accompanying Notes to Financial Statements.
FINANCIAL STATEMENTS SIX MONTHS ENDED DECEMBER 31, 1998 (unaudited)
STATEMENT OF OPERATIONS
PRIME FEDERAL
PORTFOLIO PORTFOLIO
INVESTMENT INCOME:
Income:
Interest $ 17,424,302 $ 8,760,518
Expenses:
Management fees 1,596,386 820,514
Government fees 19,449 11,264
1,615,835 831,778
Net investment income 15,808,467 7,928,740
Net increase in net assets resulting from
operations $ 15,808,467 $ 7,928,740
See accompanying Notes to Financial Statements.
FINANCIAL STATEMENTS
Six Months Ended December 31, 1998 (unaudited) and Year Ended June 30, 1998
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
PRIME FEDERAL
PORTFOLIO PORTFOLIO
</CAPTION>
<S> <C> <C>
INCREASE IN NET ASSETS FROM OPERATIONS:
Net investment income $ 27,866,875 $ 15,357,281
Net increase in net assets resulting from operations 27,866,875 15,357,281
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (27,866,875) (15,357,281)
INCREASE FROM CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold ($1.00 per share) 928,253,918 688,025,800
Net asset value of shares issued for
reinvestment of distributions ($1.00 per share) 5,260,269 2,568,617
933,514,187 690,594,417
Cost of shares redeemed ($1.00 per share) (822,862,867) (625,946,162)
Net increase in net assets from
capital share transactions 110,651,320 64,648,255
Net increase in net assets 110,651,320 64,648,255
NET ASSETS - June 30, 1997 445,095,495 238,300,734
NET ASSETS - June 30, 1998 $ 555,746,815 $ 302,948,989
INCREASE IN NET ASSETS FROM OPERATIONS:
Net investment income $ 15,808,468 $ 7,928,740
Net increase in net assets resulting from operations 15,808,468 7,928,740
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (15,808,468) (7,928,740)
INCREASE FROM CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold ($1.00 per share) 854,289,155 400,560,112
Net asset value of shares issued for
reinvestment of distributions ($1.00 per share) 3,090,130 1,916,956
857,379,285 402,477,068
Cost of shares redeemed ($1.00 per share) (769,727,889) (384,819,960)
Net increase in net assets from
capital share transactions 87,651,396 17,657,108
Net increase in net assets 87,651,396 17,657,108
NET ASSETS - June 30, 1998 555,746,815 302,948,989
NET ASSETS - December 31, 1998 $ 643,398,211 $ 320,606,097
</TABLE>
See accompanying Notes to Financial Statements.
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - The Fund is
registered under the Investment Company Act of 1940, as amended, as a
diversified, open-end management investment company. Its shares are currently
issued in two series with each series, in effect, representing a separate
fund. The following is a summary of significant accounting policies
consistently followed by the Fund in the preparation of its financial
statements. The policies are in conformity with generally accepted accounting
principles.
Investments - Valuation of securities is on the basis of amortized cost which
approximates market value. Investment transactions are recorded on the trade
date. Investment income and dividends to shareholders are recorded daily and
dividends are distributed monthly. Realized gains and losses from investment
transactions are reported on the amortized cost basis, which is also used for
federal income tax purposes.
Federal Income Taxes - The Fund's policy is to comply with the requirements
of the Internal Revenue Code that are applicable to regulated investment
companies and to distribute all of its taxable income to its shareholders.
Therefore, no federal income tax provision is required. At December 31, 1998,
the Fund has accumulated net realized losses on sales of investments for
federal income tax purposes of $33,047 (Prime Portfolio) and $48,785 (Federal
Portfolio), which are available to offset future taxable gains.
Amortization - Discounts and premiums on securities purchased are amortized
over the life of the respective securities.
Estimates - The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amount of assets and
liabilities and disclosure of contingent assets and liabilities at the date
of the financial statements and the reported amounts of income and expenses
during the reporting period. Actual results could differ from those
estimates.
2. PURCHASES AND SALES OF SECURITIES - The aggregate amounts of security
transactions during the six months ended December 31, 1998, were as follows:
Other than
U.S. Government U.S. Government
Prime Portfolio Securities Securities
Purchases $ 5,196,546,000 $ 407,332,537
Proceeds from sales 5,104,337,398 367,787,588
Federal Portfolio
Purchases $ - $ 2,879,396,188
Proceeds from sales - 2,849,147,112
3. MANAGEMENT FEES - UMB Bank, n.a. is the Fund's manager and investment
adviser and provides or pays the cost of all management, supervisory and
administrative services required in the normal operation of the Fund. This
includes investment management; fees of the custodian, independent public
accountants and legal counsel; remuneration of officers and directors; rent;
and shareholder services, including maintenance of the shareholder accounting
system and transfer agency. Not considered normal operating expenses and
therefore payable by the Fund are taxes, interest, fees and the other charges
of governments and their agencies for qualifying the fund's shares for sale,
special accounting and legal fees and brokerage commissions. UMB Bank's
management fees are based on average daily net assets of the Fund at the
annual rate of .50 of one percent of net assets. Certain officers and/or
directors of the Fund are also officers and/or directors of Jones & Babson,
Inc., which serves as the Fund's underwriter and distributor.
4. REPURCHASE AGREEMENTS - Securities purchased under agreements to resell
are held by the Fund's custodian and investment counsel, UMB Bank, n.a. The
custodian monitors the market values of the underlying securities which they
have purchased on behalf of the Fund to ensure that the collateral is
sufficient to protect the Fund in the event of default by the seller.
This report has been prepared for the information of the Shareholders of UMB
Scout Money Market Fund, Inc., and is not to be construed as an offering of
shares of the Fund. Shares of this Fund and of the other UMB Scout Funds are
offered only by the Prospectus, a copy of which may be obtained from Jones &
Babson, Inc.
UMB Scout Funds
100% No-Load Mutual Funds
Stock Fund
Regional Fund
WorldWide Fund
Capital Preservation Fund
Balanced Fund
Bond Fund
Kansas Tax-Exempt Bond Fund*
Money Market Fund
Tax-Free Money Market Fund
*Available in Kansas and Missouri only.
Manager and Investment Counsel
UMB Bank, n.a., Kansas City, Missouri
Auditors
Baird, Kurtz & Dobson, Kansas City, Missouri
Legal Counsel
Stradley, Ronon, Stevens & Young, LLP
Philadelphia, Pennsylvania
Custodian
UMB Bank, n.a., Kansas City, Missouri
Underwriter, Distributor
and Transfer Agent
Jones & Babson, Inc.
Kansas City, Missouri
UMB SCOUT FUNDS
P.O. Box 410498
Kansas City, MO 64141-0498
Toll Free 800-996-2862
www.umb.com
"UMB" and "Scout" are registered service marks of UMB Financial Corporation.
UMB Financial Corporation also claims service mark rights to the Scout
design.
JB24D(3/99) 505506
