FUND LOGO
CBA Money Fund
Annual Report
February 28, 1994
This report is not authorized for use as an offer of sale or a
solicitation of an offer to buy shares of the Fund unless
accompanied or preceded by the Fund's current prospectus.
Past performance results shown in this report should not be
considered a representation of future performance, which will
fluctuate. The Fund seeks to maintain a consistent $1.00 net
asset value per share, although this cannot be assured. An
investment in the Fund is neither insured nor guaranteed
by the US Government.
CBA Money Fund
Box 9011
Princeton, NJ 08543-9011
CBA Money Fund
Dear Shareholder:
For the year ended February 28, 1994, CBA Money Fund paid
shareholders a net annualized dividend of 2.66%*. The Fund's 7-
day yield as of February 28, 1994 was 2.71% (including gains and
losses) and 2.71% (excluding gains and losses).
The Environment
Inflationary expectations continued to shift during the six
months ended February 28, 1994. Following better-than-expected
economic results, Federal Reserve Board Chairman Alan Greenspan
indicated in Congressional testimony in January that continued
strong expansion of the economy would lead the central bank to
tighten monetary policy in an effort to control inflation. On
February 4, 1994, the central bank broke with tradition and
publicly announced a modest increase in short-term interest
rates.
<PAGE>
Rather than view the Federal Reserve Board's action as a
preemptive strike against inflation, fixed-income investors
focused on Chairman Greenspan's implicit promise of further
tightening should the rate of inflation accelerate, and bond
prices declined sharply. The setback in the bond market was also
reflected in greater stock market volatility.
In the weeks ahead, investors will continue to gauge the pace of
the economic expansion and watch for signs of an overheating
economy that could prompt successive Federal Reserve Board
actions to raise short-term interest rates. At this time, there
is little evidence that the rate of inflation will increase
rapidly. Job growth is sluggish, and new claims for unemployment
insurance have trended higher since the beginning of the year.
Commodity prices have risen somewhat, but in many cases these
increases are occurring from very depressed levels.
[FN]
*Based on a constant investment throughout the period, with
dividends compounded daily, and reflecting a net return to the
investor after all expenses.
Portfolio Matters
Since our last report to shareholders, interest rates have
reversed the trend of recent years as investors responded
adversely to the Federal Reserve Board's decision to tighten
monetary policy. During this reporting period, CBA Money Fund's
average portfolio maturity has ranged from a high of 89 days to a
low of 41 days.
In September and early October 1993, the economy exhibited
surprising strength, led by robust growth in the housing and auto
sectors. While this strength and the increased supply of US
Treasury securities were cause for concern, the market remained
stable as inflation appeared to pose no near-term threat. In an
effort to maintain average portfolio maturity and take advantage
of a relatively steep yield curve, the Fund engaged in modest
extension swaps at positive yield pickups. Identifying US
Treasury securities maturing in February 1995 as attractive, the
Fund extended from August 1994 coupons to February 1995 coupons
for monthly pickups of 5.2 basis points (0.052%) while
simultaneously shortening from US Treasury notes of August 1995
to US Treasury notes of February 1995 for monthly concessions of
only 3 basis points. Additionally, the Fund purchased one-year
bank notes at favorable yield spreads over the comparable US
Treasury note's yield.
The economic news released in late October and early November
demonstrated hard evidence of an economy that was building
positive momentum. With most expectations centered around gross
domestic product growth of 4% in the fourth quarter and an
increased supply of Treasury bills and notes, we decided to
reduce the Fund's average portfolio maturity to the mid 70-day
range. With commercial paper representing less than 45% of the
Fund's holdings, we were able to reinvest the proceeds of the
sale of the Treasury notes into January and February commercial
paper at yields ranging from 3.30% to 3.40%. Our objective of
shortening average portfolio maturity was further aided by the
renewal of a high-quality master note and additional purchases of
agency variable rate notes.
<PAGE>
Late November and December were characterized by relatively
stable interest rates as investors struggled with improving
economic conditions coupled with favorable technical factors and
low inflation. In this environment, the Fund sought to maintain
an average life in the mid to high 70-day range. To accomplish
this objective, we engaged in modest extension swaps of US
Treasury securities maturing in late 1994 and early 1995, picking
up 5 basis points--6 basis points per month in yield.
Additionally, we purchased 60-day commercial paper at a yield of
3.35% as we continued to take advantage of what was left of year-
end pressures. In late December, we increased our holdings of
variable rate instruments to 20% of total assets.
January was marked by a modest rally. The market was driven by
the belief that fourth quarter economic gains were unsustainable,
and that opinion was exacerbated by brutally cold weather in the
Midwest and East, as well as a devastating earthquake in southern
California. In this environment, we maintained the Fund's
portfolio maturity in the 70-day range. Purchases of one-year--
two-year Treasury obligations were the primary source of our
average life maintenance. Additionally, we continued to
selectively add to our holdings of agency floating rate products.
The Federal Reserve Board's announcement that it was increasing
pressure on reserves brought the end of a long rally. The Fund,
in anticipation of rising interest rates, had lowered its average
portfolio maturity to 70 days by January 31, 1994 and to 60 days
by February 4, 1994. This reduction was accomplished with the
sale of two-year Treasury notes and one-year Treasury bills. The
proceeds were reinvested in overnight repurchase agreements and
30-day commercial paper. Short-term interest rates rose through
the month of February, and we have maintained this defensive
strategy, increasing commercial paper holdings to 46.7% of total
assets and repurchase agreement holdings to almost 10%. At
February month-end, the Fund's average portfolio maturity was 47
days with more than 80% of its holdings in securities with
maturities of 60 days or less.
Looking forward, we believe interest rates will continue to rise
in response to additional Federal Reserve Board tightenings, and
accordingly, we anticipate that the Fund will maintain its
current defensive posture.
<PAGE>
The portfolio's composition at the end of the February period and
as of our last report is detailed below:
2/28/94 8/31/93
-------- --------
Bankers' Acceptances--Yankee* 1.2% 2.9%
Bank Notes 3.1 --
Certificates of Deposit -- 3.3
Certificates of Deposit--European -- 5.6
Certificates of Deposit--Yankee* 3.1 --
Commercial Paper 46.7 44.4
Corporate Notes -- 3.3
Master Notes 9.9 7.2
Repurchase Agreements 9.6 3.8
US Government & Agency
Obligations 28.3 30.7
Liabilities in Excess of
Other Assets (1.9) (1.2)
-------- --------
100.0% 100.0%
======== ========
[FN]
* US branches of foreign banks.
We appreciate your continued support of CBA Money Fund, and we
look forward to assisting you with your financial needs and
objectives in the months and years ahead.
Sincerely,
(Arthur Zeikel)
Arthur Zeikel
President
(Carlo J. Giannini)
Carlo J. Giannini
Vice President and Portfolio Manager
March 24, 1994
Officers and Trustees
Arthur Zeikel--President and Trustee
Ronald W. Forbes--Trustee
Charles C. Reilly--Trustee
Kevin A. Ryan--Trustee
Richard R. West--Trustee
Terry K. Glenn--Executive Vice President
Joseph T. Monagle, Jr.--Senior Vice President
Donald C. Burke--Vice President
Carlo J. Giannini--Vice President
Kevin J. McKenna--Vice President
Gerald M. Richard--Treasurer
Robert Harris--Secretary
<PAGE>
Custodian
State Street Bank and Trust Company
P.O. Box 1713
Boston, Massachusetts 02101
Transfer Agent
Financial Data Services, Inc.
4800 Deer Lake Drive East
Jacksonville, Florida 32246-6484
(800) 221-7210*
[FN]
* For inquiries regarding your CBA account,
call (800) 247-6400.
CBA Money Fund
Schedule of Investments as of February 28, 1994 (in Thousands)
Face Interest Maturity Value
Issue Amount Rate* Date (Note 1a)
Bankers' Acceptances--Yankee--1.2%
Sanwa Bank, Ltd., $ 5,000 3.11 % 4/18/94 $4,977
Japan, NY
Sumitomo Bank, Ltd., NY 10,000 3.15 4/20/94 9,952
Total Bankers' Acceptances--Yankee
(Cost--$14,935) 14,929
Bank Notes--3.1%
Bank of Delaware 5,000 3.30 6/10/94 4,994
Nations Bank Texas 5,000 3.625 11/30/94 4,984
PNC Bank Corp., 15,000 3.40 10/14/94 14,944
Kentucky
Trust Co. Bank, Atlanta 10,000 3.60 6/30/94 9,995
5,000 3.375 9/30/94 4,985
Total Bank Notes
(Cost--$39,983) 39,902
<PAGE>
Certificates of Deposit--Yankee--3.1%
Dai-Ichi Kangyo Bank, 20,000 3.14 3/16/94 20,000
Ltd., NY
Sumitomo Bank, Ltd., NY 20,000 3.33 3/14/94 20,000
Total Certificates of Deposit--Yankee
(Cost--$40,000) 40,000
Commercial Paper--46.7%
American Express 25,000 3.21 4/04/94 24,923
Credit Corp.
BASF Corp. 10,000 3.25 3/22/94 9,981
B.B.V. Finance 20,000 3.21 4/04/94 19,939
(Delaware), Inc.
BellSouth Telecom- 8,000 3.33 3/02/94 7,999
munications, Inc.
Bowater PLC 8,000 3.40 3/14/94 7,989
Central Hispano 20,000 3.21 4/07/94 19,929
North American 15,000 3.17 5/02/94 14,906
Capital Corp.
Ciesco L.P. 1,000 3.22 3/08/94 999
8,200 3.10 3/23/94 8,183
20,000 3.45 3/29/94 19,944
Corporate Receivables 20,000 3.10 3/08/94 19,986
Corp.
CS First Boston, Inc. 15,000 3.12 3/03/94 14,996
CSW Credit, Inc. 4,000 3.40 3/28/94 3,989
4,000 3.44 4/07/94 3,986
Face Interest Maturity Value
Issue Amount Rate* Date (Note 1a)
<PAGE>
Commercial Paper (concluded)
CXC Inc. $ 5,100 3.35% 3/04/94 $ 5,098
30,000 3.10 3/11/94 29,972
Falcon Asset 20,050 3.10 3/08/94 20,036
Securitization Corp.
General Electric Capital 25,000 3.42 4/07/94 24,910
Services, Inc.
Gillette Company (The) 6,800 3.15 3/08/94 6,795
Goldman Sachs Group, 15,000 3.22 4/07/94 14,947
L.P.
Hanson Finance 7,000 3.10 4/28/94 6,962
(U.K.) PLC 20,000 3.20 5/05/94 19,869
J.C. Penney Funding 10,000 3.15 3/16/94 9,986
Corp.
KFW International 10,000 3.25 4/14/94 9,958
Finance, Inc.
MCA Funding Corp. 15,000 3.23 3/09/94 14,988
New Center Asset Trust 25,000 3.12 4/15/94 24,893
Nomura Holding 10,000 3.23 4/04/94 9,969
America, Inc. 10,000 3.12 4/07/94 9,965
10,000 3.25 5/09/94 9,931
Preferred Receivables 8,650 3.42 3/07/94 8,644
Funding Corp. 20,000 3.37 3/16/94 19,970
4,513 3.42 3/17/94 4,506
Queensland Treasury 15,000 3.13 4/12/94 14,940
Corp. 3,000 3.10 4/22/94 2,985
Sanwa Business 7,100 3.12 3/02/94 7,099
Credit Corp. 16,000 3.35 3/08/94 15,988
5,247 3.40 3/08/94 5,243
10,000 3.45 3/11/94 9,990
<PAGE>
Sheffield Receivables 16,311 3.50 4/04/94 16,256
Corp.
Student Loan Corp. 15,000 3.10 3/07/94 14,991
Svenska 25,000 3.35 3/11/94 24,976
Handelsbanken, Inc.
US West 15,000 3.33 3/07/94 14,990
Communications, Inc.
USL Capital Corp. 20,000 3.37 3/17/94 19,968
Wool International 25,000 3.50 4/06/94 24,910
Total Commercial Paper
(Cost--$601,532) 601,484
CBA Money Fund
Schedule of Investments as of February 28, 1994 (concluded)
(in Thousands)
Face Interest Maturity Value
Issue Amount Rate* Date (Note 1a)
Master Notes--9.9%
Bear Stearns $ 7,000 3.49% 5/23/94 $ 7,000
Companies, Inc.++
Goldman Sachs Group, 25,000 3.48 3/01/94 25,000
L.P.++ 40,000 3.49 9/01/94 40,000
Kingdom of Sweden++ 55,000 3.4375 7/15/94 55,000
Total Master Notes
(Cost--$127,000) 127,000
US Government & Agency Obligations--
Discount Notes--4.2%
Federal Home Loan 20,000 3.11 5/06/94 19,870
Mortgage Corp.
US Treasury Bills 538 3.20 6/16/94 532
20,000 3.23 6/23/94 19,782
15,000 3.495 2/09/95 14,445
Total US Government & Agency Obligations--
Discount Notes (Cost--$54,707) 54,629
<PAGE>
US Government & Agency Obligations--
Non-Discount Notes--24.1%
Federal Home Loan 5,000 3.43 6/21/95 5,000
Banks++ 10,000 3.66 8/09/95 10,000
11,000 3.43 12/28/95 11,000
12,000 3.46 6/17/96 12,000
5,000 3.46 6/21/96 5,000
15,000 3.53 2/03/97 14,992
15,000 3.53 2/10/97 15,000
Federal Home Loan 30,000 3.0525 1/06/95 29,991
Mortgage Corp.++ 10,000 3.60 8/09/95 10,000
12,000 3.36 9/01/95 11,996
Face Interest Maturity Value
Issue Amount Rate* Date (Note 1a)
US Government & Agency Obligations--
Non-Discount Notes (concluded)
Federal $ 5,000 3.40 % 12/20/95 $ 5,000
National Mortgage 15,000 3.33 5/13/96 15,000
Association++ 12,000 3.45 5/19/97 12,000
11,000 3.50 5/14/98 11,000
Student Loan 1,370 3.95 3/20/95 1,376
Marketing Association++ 3,430 4.01 3/20/95 3,439
8,500 3.76 8/07/95 8,500
33,000 3.76 3/20/96 33,000
10,000 3.77 1/14/97 10,000
US Treasury Notes 20,000 4.25 8/31/94 20,047
17,000 6.00 11/15/94 17,239
48,500 3.875 2/28/95 48,371
Total US Government & Agency Obligations--
Non-Discount Notes (Cost--$310,259) 309,951
<PAGE>
Repurchase Agreements **--9.6%
Face Amount Issue
$60,000 Carroll McEntee & McGinley, Inc.,
purchased on 2/28/94 to yield
3.40% to 3/01/94 60,000
63,394 Citicorp Securities, Inc.,
purchased on 2/28/94 to yield
3.45% to 3/01/94 63,394
Total Repurchase Agreements
(Cost--$123,394) 123,394
Total Investments (Cost--$1,311,810)--101.9% 1,311,289
Liabilities in Excess of Other Assets--(1.9%) (23,833)
----------
Net Assets--100.0% $1,287,456
==========
[FN]
* Bankers' Acceptances, Commercial Paper and certain US Government & Agency
Obligations are traded on a discount basis; the interest rates shown are the
discount rates paid at the time of purchase by the Fund. Other securities
bear interest at the rates shown, payable at fixed dates or upon maturity.
Interest rates on variable rate securities are adjusted periodically based
upon appropriate indexes. The interest rates shown are those in effect at
February 28, 1994.
** Repurchase Agreements are fully collateralized by US Government Obligations.
++ Floating Rate Notes.
See Notes to Financial Statements.
<PAGE>
CBA Money Fund
<TABLE>
<CAPTION>
Statement of Assets and Liabilities as of February 28, 1994
<S> <C> <C>
Assets:
Investments, at value (identified cost--$1,311,810,092*) (Note 1a) $1,311,288,708
Cash 662
Receivables:
Securities sold $ 14,988,500
Interest receivable 2,169,955 17,158,455
--------------
Prepaid registration fees and other assets (Note 1d) 68,251
--------------
Total assets 1,328,516,076
--------------
Liabilities:
Payables:
Securities purchased 40,000,000
Investment adviser (Note 2) 392,035
Distributor (Note 2) 362,506
Beneficial interest redeemed 640 40,755,181
--------------
Accrued expenses and other liabilities 304,896
--------------
Total liabilities 41,060,077
--------------
Net Assets $1,287,455,999
==============
Net Assets Consist of:
Shares of beneficial interest, $.10 par value, unlimited number of shares authorized $ 128,797,738
Paid-in capital in excess of par 1,159,179,645
Unrealized depreciation on investments--net (521,384)
--------------
Net Assets--Equivalent to $1.00 per share based on 1,287,977,383 shares of beneficial
interest outstanding $1,287,455,999
==============
<FN>
* Cost for Federal income tax purposes. As of February 28, 1994,
net unrealized depreciation for Federal income tax purposes
amounted to $521,384, of which $5,056 related to appreciated
securities and $526,440 related to depreciated securities.
See Notes to Financial Statements.
</TABLE>
<PAGE>
CBA Money Fund
<TABLE>
<CAPTION>
Statement of Operations for the Year Ended February 28, 1994
<S> <C> <C>
Investment Income (Note 1c):
Interest and amortization of premium and discount earned $ 40,372,684
Expenses:
Investment advisory fees (Note 2) $ 5,480,451
Transfer agent fees (Note 2) 1,685,508
Distribution fees (Note 2) 1,500,403
Printing and shareholder reports 156,825
Registration fees (Note 1d) 134,555
Accounting services (Note 2) 91,471
Custodian fees 91,018
Professional fees 47,484
Trustees' fees and expenses 24,314
Other 16,522
--------------
Total expenses before reimbursement 9,228,551
Reimbursement of expenses (Note 2) (490,737)
--------------
Total expenses after reimbursement 8,737,814
--------------
Investment Income--Net 31,634,870
Realized Gain on Investments--Net (Note 1c) 468,706
Change in Unrealized Appreciation/Depreciation on Investments--Net (935,673)
--------------
Net Increase in Net Assets Resulting from Operations $ 31,167,903
==============
</TABLE>
<PAGE>
<TABLE>
CBA Money Fund
<CAPTION>
For the Year Ended
February 28,
Statements of Changes in Net Assets 1994 1993
Increase (Decrease) in Net Assets:
<S> <C> <C>
Operations:
Investment income--net $ 31,634,870 $ 37,502,857
Realized gain on investments--net 468,706 1,695,155
Change in unrealized appreciation/depreciation on investments--net (935,673) 414,290
-------------- --------------
Net increase in net assets resulting from operations 31,167,903 39,612,302
-------------- --------------
Dividends & Distributions to Shareholders (Note 1e):
Investment income--net (31,634,870) (37,502,857)
Realized gain on investments--net (468,706) (1,695,155)
-------------- --------------
Net decrease in net assets resulting from dividends and distributions to shareholders (32,103,576) (39,198,012)
-------------- --------------
Beneficial Interest Transactions (Note 3):
Net proceeds from sale of shares 3,818,160,854 3,778,680,584
Net asset value of shares issued to shareholders in reinvestment of dividends (Note 1e) 32,034,051 39,116,936
-------------- --------------
3,850,194,905 3,817,797,520
Cost of shares redeemed (3,804,489,714) (3,787,357,923)
-------------- --------------
Net increase in net assets derived from beneficial interest transactions 45,705,191 30,439,597
-------------- --------------
Net Assets:
Total increase in net assets 44,769,518 30,853,887
Beginning of year 1,242,686,481 1,211,832,594
-------------- --------------
End of year $1,287,455,999 $1,242,686,481
============== ==============
See Notes to Financial Statements.
</TABLE>
<PAGE>
CBA Money Fund
<TABLE>
Financial Highlights
<CAPTION>
The following per share data and ratios have been derived For the Year Ended For the For the Year Ended
from information provided in the financial statements. February 28, Year Ended February 28,
------------------------ February 29, ----------------------
Increase (Decrease) in Net Asset Value: 1994 1993 1992 1991 1990
<S> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of year $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- ---------- ---------- ---------- ----------
Investment income--net .0260 .0304 .0511 .0736 .0846
Realized and unrealized gain (loss) on investments--net (.0004) .0017 .0008 .0006 .0004
---------- ---------- ---------- ---------- ----------
Total from investment operations .0256 .0321 .0519 .0742 .0850
---------- ---------- ---------- ---------- ----------
Less dividends and distributions:
Investment income--net (.0260) (.0304) (.0511) (.0736) (.0846)
Realized gain on investments--net (.0004) (.0014) (.0008)++ (.0006)++ (.0004)++
---------- ---------- ---------- ---------- ----------
Total dividends and distributions (.0264) (.0318) (.0519) (.0742) (.0850)
---------- ---------- ---------- ---------- ----------
Net asset value, end of year $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
========== ========== ========== ========== ==========
Total Investment Return 2.66% 3.24% 5.32% 7.69% 8.82%
========== ========== ========== ========== ==========
Ratios to Average Net Assets:
Expenses, net of reimbursement and excluding
distribution fees .59% .59% .56% .57% .56%
========== ========== ========== ========== ==========
Expenses, net of reimbursement .71% .71% .69% .70% .68%
========== ========== ========== ========== ==========
Expenses .75% .75% .74% .75% .81%
========== ========== ========== ========== ==========
Investment income and realized gain on investments--net 2.62% 3.19% 5.18%++ 7.40%++ 8.40%++
========== ========== ========== ========== ==========
Supplemental Data:
Net assets, end of year (in thousands) $1,287,456 $1,242,686 $1,211,833 $1,063,827 $ 864,835
========== ========== ========== ========== ==========
<FN>
++Includes unrealized gain (loss).
See Notes to Fiancial Statements.
</TABLE>
<PAGE>
CBA Money Fund
Notes to Financial Statements
1. Significant Accounting Policies:
CBA Money Fund (the "Fund") is a money fund whose shares are
offered to subscribers to the Capital Builder Account service of
Merrill Lynch, Pierce, Fenner & Smith Inc. ("MLPF&S") and to
subscribers to the Broadcort Capital Account service of Broadcort
Capital Corp. ("Broadcort"). Shares may also be purchased by
individual investors not subscribing to these services, but such
investors will not receive any of the special features offered as
a part of such services. The Fund is registered under the
Investment Company Act of 1940 as a diversified, open-end
investment management company. The following is a summary of
significant accounting policies followed by the Fund.
(a) Valuation of investments--Portfolio securities with remaining
maturities of sixty days or less are valued at amortized cost,
which approximates market. Securities with remaining maturities
of greater than sixty days for which market quotations are
readily available will be valued at market value. When securities
are valued with sixty days or less to maturity, the difference
between the valuation existing on the sixty-first day before
maturity and maturity value is amortized on a straight-line basis
to maturity. Other securities held by the Fund will be valued at
their fair value as determined in good faith by or under the
direction of the Board of Trustees.
(b) 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 taxable income
to its shareholders. Therefore, no Federal income tax provision
is required.
(c) Security transactions and investment income--Security
transactions are recorded on the dates the transactions are
entered into (the trade dates). Realized gains and losses on
security transactions are determined on the identified cost
basis. Interest income (including amortization of premium and
discount) is recognized on the accrual basis.
(d) Prepaid registration fees--Prepaid registration fees are
charged to expense as the related shares are issued.
(e) Dividends to shareholders--The Fund declares dividends daily
and reinvests daily such dividends (net of non-resident alien tax
and back-up withholding tax withheld) in additional Fund shares
at net asset value. Dividends are declared from the total of net
investment income and net realized gains or losses on
investments.
<PAGE>
2. Investment Advisory Agreement and Transactions with
Affiliates:
The Fund has entered into an Investment Advisory Agreement with
Fund Asset Management, L.P. ("FAM"). Effective January 1, 1994,
the investment advisory business of FAM was reorganized from a
corporation to a limited partnership. Both prior to and after the
reorganization, ultimate control of FAM was vested with Merrill
Lynch & Co., Inc. ("ML & Co."). The general partner of FAM is
Princeton Services, Inc., an indirect wholly-owned subsidiary of
ML & Co. The limited partners are ML & Co. and Merrill Lynch
Investment Management, Inc. ("MLIM") which is also an indirect
wholly-owned subsidiary of ML & Co.
FAM (the "Manager") is responsible for the management of the
Fund's portfolio and provides the necessary personnel,
facilities, equipment and certain other services necessary to the
operations of the Fund. For such services, the Fund pays a
monthly fee based upon the average daily value of the Fund's net
assets at the following annual rates: 0.50% of the first $500
million of average daily net assets, 0.425% of average daily net
assets in excess of $500 million but not exceeding $1 billion,
and 0.375% of average daily net assets in excess of $1 billion.
The most restrictive annual expense limitation requires that
Notes to Financial Statements
(concluded)
the Manager reimburse the Fund in any amount necessary to prevent
such operating expenses of the Fund (excluding interest, taxes,
distribution fees, brokerage fees and commissions, and
extraordinary items) from exceeding in any fiscal year 2.5% of
the Fund's first $30 million of average daily net assets, 2.0% of
the next $70 million of average daily net assets, and 1.5% of the
remaining average daily net assets. No fee payment will be made
to the Manager during the year which will cause such expenses to
exceed the pro rata expense limitation at the time of such
payment. During the year ended February 28, 1994, the Manager
earned $5,480,451, of which $490,737 was voluntarily waived.
<PAGE>
The Fund has adopted a Distribution and Shareholder Servicing
Plan in compliance with Rule 12b-1 under the Investment Company
Act of 1940, pursuant to which MLPF&S and Broadcort each receive
a distribution fee under the Distribution Agreement from the Fund
at the end of each month at the annual rate of 0.125% of average
daily net assets of the Fund attributable to subscribers to the
respective Capital Builder Account and Broadcort Capital Account
programs. The MLPF&S distribution fee is to compensate MLPF&S
financial consultants and other directly involved branch office
personnel for selling shares of the Fund and for providing direct
personal services to shareholders. The Broadcort distribution fee
is to compensate selected dealers for activities and services
related to the sale, promotion and marketing of shares of the
Fund. The distribution fee is not compensation for the
administrative and operational services rendered to the Fund by
MLPF&S or Broadcort in processing share orders and administering
shareholder accounts.
Financial Data Services, Inc. ("FDS"), a wholly-owned subsidiary
of ML & Co., is the Fund's transfer agent.
Accounting services are provided to the Fund by FAM at cost.
Certain officers and/or trustees of the Fund are officers and/or
directors of FAM, MLIM, FDS, Merrill Lynch, Pierce, Fenner &
Smith, Inc. ("MLPF&S"), and/or ML & Co.
3. Beneficial Interest Transactions:
The number of shares purchased and redeemed during the year
corresponds to the amounts included in the Statements of Changes
in Net Assets with respect to net proceeds from sale of shares
and cost of shares redeemed, respectively, since shares are
recorded at $1.00 per share.
<AUDIT-REPORT>
CBA Money Fund
Independent Auditors' Report
The Board of Trustees and Shareholders,
CBA Money Fund:
We have audited the accompanying statement of assets and
liabilities, including the schedule of investments, of
CBA Money Fund (the "Fund") as of February 28, 1994, the
related statement of operations for the year then ended and
changes in net assets for each of the years in the two-year
period then ended, and the financial highlights for each of
the years in the five-year period then ended. These
financial statements and the financial highlights are the
responsibility of the Fund's management. Our responsibility
is to express an opinion on these financial statements and the
financial highlights based on our audits.
<PAGE>
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether
the financial statements and the financial highlights are free of
material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the
financial statements. Our procedures included confirmation of
securities owned at February 28, 1994 by correspondence with the
custodian and brokers. An audit also includes assessing the
accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable
basis for our opinion.
In our opinion, such financial statements and financial
highlights present fairly, in all material respects, the
financial position of CBA Money Fund as of February 28, 1994, the
results of its operations, the changes in its net assets, and the
financial highlights for the respective stated periods in
conformity with generally accepted accounting principles.
Deloitte & Touche
Princeton, New Jersey
March 31, 1994
</AUDIT-REPORT>
CBA Money Fund
Important Tax Information
None of the ordinary income distributions paid daily by CBA Money
Fund during the year ended February 28, 1994 qualify for the
dividends received deduction for corporations. Additionally,
there were no long-term capital gain distributions paid during
the year.
The law varies in each state as to whether and what percentage of
dividend income attributable to Federal obligations is exempt
from state income tax. We recommend that you consult your tax
adviser to determine if any portion of the dividends you received
is exempt from state income tax.
<PAGE>
Listed below are the percentages of total assets of the Fund
invested in Federal obligations as of the end of each quarter of
the fiscal year:
Percentage of
Quarter Ended Federal Obligations++
May 31, 1993 16.90%
August 31, 1993 30.19
November 30, 1993 26.70
February 28, 1994 18.80
Of the Fund's ordinary income dividends paid during the year
ended February 28, 1994, 20.46% was attributable to Federal
obligations. In calculating the foregoing percentage, expenses of
the Fund have been allocated on a pro-rata basis.
Please retain this information for your records.
[FN]
++For purposes of this calculation, Federal obligations include
US Treasury Notes, US Treasury Bills and US Treasury
Bonds. Also included are obligations issued by the following
agencies: Banks for Cooperatives, Federal Intermediate
Credit Banks, Federal Land Banks, Federal Home Loan
Banks, and the Student Loan Marketing Association.
Repurchase agreements are not included in this calculation.
