Scudder Ohio Tax Free Fund
Semiannual Report
September 30, 1996
Pure No-Load(TM) Funds
For investors seeking double-tax-free income exempt from both Ohio and regular
federal income taxes.
A pure no-load(TM) fund with no commissions to buy, sell, or exchange shares.
<PAGE>
Table of Contents
2 In Brief
3 Letter from the Fund's President
4 Performance Update
5 Portfolio Summary
6 Portfolio Management Discussion
10 Investment Portfolio
14 Financial Statements
17 Financial Highlights
18 Notes to Financial Statements
21 Officers and Trustees
22 Investment Products and Services
23 How to Contact Scudder
In Brief
o As of September 30, 1996, the Fund's 30-day net annualized SEC yield was
5.05%, equivalent to a 9.04% taxable yield for Ohio investors subject to the
44.13% maximum combined federal and state income tax rate.
THE PRINTED DOCUMENT CONTAINS A BAR CHART HERE
BAR CHART TITLE: 30-Day Yield on September 30, 1996
BAR CHART DATA:
Scudder Taxable Yield
Ohio Tax Needed to Equal
Free Fund the Fund's Yield
5.05% 9.04%
The Fund received four stars from Morningstar, reflecting "above-average"
risk-adjusted performance through September 30, 1996.
For your information, these ratings are subject to change every month and are
calculated from the Fund's five-year average annual return in excess of 90-day
Treasury bill returns with appropriate fee adjustments, and a risk factor that
reflects fund performance below T-bill returns. 561 municipal funds were rated.
10% received five stars, 22.5% received four stars, 35% three stars, 22.5% two
stars, and the bottom 10% one star. The Fund received four stars for three- and
five-year performance as well. Past performance is no guarantee of future
returns.
o For its semiannual period ended September 30, 1996, Scudder Ohio Tax Free
Fund posted a total return of 3.37%, higher than the 3.04% average return of 56
similar funds tracked by Lipper Analytical Services. See page 7 for additional
information on the Fund's rankings.
2 - SCUDDER OHIO TAX FREE FUND
<PAGE>
Letter From the Fund's President
Dear Shareholders,
We hope you enjoy our newly redesigned shareholder report. The new format,
which is being gradually introduced for all Scudder funds, is intended to
enhance the usefulness and readability of the reports.
Let us know what you think.
We are pleased to report on Scudder Ohio Tax Free Fund's favorable
long-term performance. In addition to the Fund's four-star Morningstar rating
(see "In Brief" on page 2), the Fund has consistently outperformed the average
of all Ohio tax-free funds in its category over six-month, one-, two-, three,
four-, and five-year periods (please see the chart on page 7 for more
information). And as portfolio managers Donald Carleton and Philip Condon report
in the portfolio management discussion that follows, the Fund continues to post
a high double tax-free yield by investing in a wide variety of Ohio municipal
bonds. The Fund also attempts to approximate the average maturity of the
unmanaged Lehman Brothers Municipal Bond Index but with a superior portfolio
structure. Please read the discussion beginning on page 6 for more information.
Lastly, we would also like to take this opportunity to introduce the two
newest members of Scudder's family of pure no-load(TM) funds -- Scudder 21st
Century Growth Fund and Scudder Classic Growth Fund. Scudder 21st Century Growth
Fund seeks long-term growth by investing primarily in the securities of emerging
growth companies poised to be leaders in the 21st century. Scudder Classic
Growth Fund seeks long-term growth by investing primarily in common stocks of
medium to large U.S. companies; additionally, it seeks to keep the value of its
shares more stable than the typical capital growth mutual fund. For more
information on either of these new funds and other Scudder products and
services, please see page 22. For questions about Scudder Ohio Tax Free Fund,
please call a Scudder Investor Information representative at 1-800-225-2470.
Sincerely,
/s/David S. Lee
David S. Lee
President,
Scudder Ohio Tax Free Fund
3 - SCUDDER OHIO TAX FREE FUND
<PAGE>
PERFORMANCE UPDATE as of SEPTEMBER 30, 1996
- ----------------------------------------------------------------
FUND INDEX COMPARISONS
- ----------------------------------------------------------------
Total Return
Period Growth --------------
Ended of Average
9/30/96 $10,000 Cumulative Annual
- --------------------------------------
SCUDDER OHIO TAX FREE FUND
- --------------------------------------
1 Year $10,625 6.25% 6.25%
5 Year $14,222 42.22% 7.30%
Life of
Fund* $20,046 100.46% 7.72%
- --------------------------------------
LEHMAN BROTHERS MUNICIPAL BOND INDEX
- --------------------------------------
1 Year $10,604 6.04% 6.04%
5 Year $14,323 43.23% 7.44%
Life of
Fund* $21,340 113.40% 8.46%
The Fund commenced operations on May 28,1987. Index
comparisons begin May 31, 1987.
- -----------------------------------------------------------------
GROWTH OF A $10,000 INVESTMENT
- -----------------------------------------------------------------
A chart in the form of a line graph appears here,
illustrating the Growth of a $10,000 Investment.
The data points from the graph are as follows:
YEARLY PERIODS ENDED SEPTEMBER 30
SCUDDER OHIO TAX FREE FUND
Year Amount
- ----------------------
'5/31/87 $10,000
'87 $ 9,462
'88 $10,858
'89 $11,823
'90 $12,381
'91 $14,095
'92 $15,534
'93 $17,671
'94 $17,062
'95 $18,862
'96 $20,046
LEHMAN BROTHERS MUNICIPAL BOND INDEX
Year Amount
- ----------------------
'5/31/87 $10,000
'87 $10,038
'88 $11,341
'89 $12,325
'90 $13,163
'91 $14,899
'92 $16,456
'93 $18,553
'94 $18,100
'95 $20,124
'96 $21,340
The unmanaged Lehman Brothers Municipal Bond Index is a market value-weighted
measure of municipal bonds issued across the United States. Index issues have a
credit rating of at least Baa and a maturity of at least two years. Index
returns assume reinvestment of dividends and, unlike Fund returns, do not
reflect any fees or expenses.
- -----------------------------------------------------------------
RETURNS AND PER SHARE INFORMATION
- -----------------------------------------------------------------
A chart in the form of a bar graph appears here,
illustrating the Fund Total Return (%) and Index Total
Return (%) with the exact data points listed in the table
below.
YEARLY PERIODS ENDED SEPTEMBER 30
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1987* 1988 1989 1990 1991 1992 1993 1994 1995 1996
-------------------------------------------------------------------------------
NET ASSET VALUE... $11.10 $11.86 $12.00 $11.71 $12.46 $12.93 $13.72 $12.46 $13.02 $13.04
INCOME DIVIDENDS.. $ .26 $ $ .76 $ .84 $ .79 $ .77 $ .74 $ .71 $ .70 $ .69 $ .68
CAPITAL GAINS
DISTRIBUTIONS..... $ - $ .01 $ .05 $ .06 $ .06 $ .02 $ .21 $ .10 $ .03 $ .09
FUND TOTAL
RETURN (%)........ -5.38 14.75 8.88 4.72 13.84 10.21 13.76 -3.44 10.58 6.25
INDEX TOTAL
RETURN (%)........ .38 12.98 8.68 6.80 13.19 10.45 12.74 -2.44 11.18 6.04
</TABLE>
All performance is historical, assumes reinvestment of all dividends and capital
gains, and is not indicative of future results. Investment return and principal
value will fluctuate, so an investor's shares, when redeemed, may be worth more
or less than when purchased. If the Adviser had not temporarily capped expenses,
the average annual total return for the Fund for the one year, five year, and
life of Fund periods would have been lower.
4 - SCUDDER OHIO TAX FREE FUND
<PAGE>
PORTFOLIO SUMMARY as of SEPTEMBER 30, 1996
- ---------------------------------------------------------------------------
DIVERSIFICATION
- ---------------------------------------------------------------------------
General Obligation 28%
Hospital/Health 19%
Sales and Special Tax 11%
Water/Sewer Revenue 11%
Higher Education 10%
Core Cities/Lease 7%
Electric Utility Revenue 4%
School District/Lease 3%
Pollution Control Industry
Development 3%
Miscellaneous Municipal 4%
- --------------------------------------
100%
- --------------------------------------
A graph in the form of a pie chart appears here,
illustrating the exact data points in the above table.
The Fund continues to be broadly diversified, with investments in more than 10
categories of Ohio municipal bonds.
- --------------------------------------------------------------------------
QUALITY
- ------------------------------------------
AAA 52%
AA 13%
A 19%
BBB 9%
Not Rated 7%
- ------------------------------------------
100%
- ------------------------------------------
Weighted average quality: AA
A graph in the form of a pie chart appears here,
illustrating the exact data points in the above table.
Overall quality remains high, with 84% of portfolio securities rated A or
better.
- --------------------------------------------------------------------------
EFFECTIVE MATURITY
- --------------------------------------------------------------------------
Less than 1 year 3%
1-5 years 15%
5-10 years 31%
10-20 years 44%
Greater than 20 years 7%
- ------------------------------------------
100%
- ------------------------------------------
Weighted average effective maturity: 10.3 years
A graph in the form of a pie chart appears here,
illustrating the exact data points in the above table.
To take advantage of opportunities to lock in a substantial income stream
over time, we buy and hold noncallable municipal bonds with 15 to 20 year
maturities.
- -----------------------------------------------------------------------------
For more complete details about the Fund's investment portfolio,
see page 10.
5 - SCUDDER OHIO TAX FREE FUND
<PAGE>
Portfolio Management Discussion
Dear Shareholders,
Over two contrasting quarters of municipal bond market performance, Scudder Ohio
Tax Free Fund continued to post a high double tax-free yield and maintain
consistently strong long-term total return performance. On September 30, 1996,
the Fund's 30-day net annualized SEC yield was 5.05%, equivalent to a 9.04%
taxable yield for shareholders subject to the 44.13% maximum combined state and
federal income tax rate. This "tax-equivalent" yield is significantly higher
than current yields available from taxable investments of similar maturity and
credit quality. During its most recent semiannual period ended September 30, the
Fund's shareholders received $0.34 per share of income exempt from federal and
Ohio state income taxes.
During a six-month period that saw modest price gains for the
intermediate-maturity municipal bonds the Fund primarily invests in, the Fund's
share price increased $0.09 to $13.04 per share. The combination of the increase
in the Fund's share price and $0.34 in interest income enabled the Fund to post
a positive total return of 3.37% over the semiannual period. The Fund's return
compares favorably with the 3.04% average total return of similar funds tracked
by Lipper Analytical Services. The Fund also surpassed the average annual
returns of similar Ohio tax-free funds over one-, two-, three-, four-, and
five-year periods.
An Update on
the Ohio Economy
Recent improvements in Ohio's financial management and an expanding economy have
strengthened Ohio's creditworthiness. These factors were the impetus behind
Moody's and Standard and Poor's recent decisions to raise the state's general
obligation bond rating from Aa/AA to Aa1/AA+, respectively. Ohio finished its
1996 fiscal year with its third consecutive operating surplus, higher than
anticipated because tax receipts exceeded expectations. The state's strong
economy has been fostering job growth and increases in taxable sales.
Ohio's improving financial condition has also triggered a personal income tax
cut for the 1996 tax year; at the same time, its debt burden is low. In
addition, the manufacturing, service, and trade sectors continue to anchor the
economy. These sectors of the non-agricultural work force employ 21%, 26% and
24% of the total work force, respectively. The decline in Ohio manufacturing
jobs has stabilized. The state's unemployment rate in 1995 was 4.8%, below the
national average of 5.2%.
6 - SCUDDER OHIO TAX FREE FUND
<PAGE>
Scudder Ohio Tax Free Fund:
Consistent Above-Average Performance
(Returns for periods ended September 30, 1996)
----------------------------------------------
Scudder
Ohio Tax
Free Fund Lipper Number
Period Return Average of Funds
------ ------ ------- --------
Six Months 3.37% 3.04% 56
1 Year 6.25% 5.56% 56
2 Years 8.41% 7.75% 47
3 Years 4.29% 3.85% 34
4 Years 6.58% 6.23% 24
5 Years 7.30% 7.01% 20
Past performance does not guarantee future results.
Economic and Market Review
The U.S. economy continued to grow at a moderate to slow pace during the Fund's
most recent semiannual period. The two quarters were mixed in terms of bond
market performance; for the second quarter of 1996, the economy picked up some
steam as snow from heavy winter storms melted, shoppers returned to retail
stores, and hiring increased. In addition, the collapse of the Congressional
Republicans' budget initiatives was viewed unfavorably by the bond market. These
two factors helped to drive bond yields higher (and prices lower) during the
second quarter. Bond yields as well as the economy retreated during the third
quarter as consumers seemed to feel the weight of their personal debt -- credit
card debt service payments as a percentage of disposable income rose to an
all-time high this year, and analysts predicted over a million people will
declare bankruptcy in 1996.
Over the past several years, the economy has progressed at a fairly consistent
pace, with inflation restrained throughout. The bond market, on the other hand,
has been fairly volatile, constantly anticipating far greater changes than the
economy has exhibited. Now, after six years of expansion, the U.S. economy may
actually be slowing. Consumers appear to be overburdened, retail sales figures
were negative during the third quarter, the government's monetary policy is
tight by historical standards (with a Fed Funds rate of 5.25%), and business
investment is slowing. In recent months, bond yields have fluctuated, but have
generally declined in step with this pullback.
For the semiannual period, municipal bonds, which typically exhibit less price
volatility than Treasury bonds, held their own, thanks in part to a relatively
light supply. While yields of long-term Treasury bonds rose two tenths of a
percentage point and prices declined 2.4% during the period, yields of municipal
bonds of similar maturity declined two tenths of a percentage point while prices
rose 2.9% for the same period. Large numbers of municipal bonds were called or
reached maturity during the period, especially in June and July. In September,
new municipal issues totaled $10.5 billion, the lowest monthly number in over a
year. The municipal market continues to be supported both by retail bond buyers
and institutions such as insurance companies.
7 - SCUDDER OHIO TAX FREE FUND
<PAGE>
Three-Point Strategy
Our strategy in managing Scudder Ohio Tax Free Fund's portfolio is to buy and
hold noncallable intermediate maturity bonds (those with maturities of 15 to 20
years) to take advantage of opportunities to lock in a substantial income stream
for the Fund over time. As of September 30, 17% of the Fund's securities had
maturities in this range. We also continue to look for opportunities to add some
BBB-rated and non-rated bonds to the portfolio. These bonds, while carrying some
additional credit risk, generally exhibit less interest rate sensitivity than
municipal bonds rated A or above. The Fund held 16% of bonds in these two
categories as of September 30. (For a summary of the Fund's quality,
diversification, and maturity structure, see page 5.) Lastly, our goal is to
have an average effective maturity similar to that of the unmanaged Lehman
Brothers Municipal Bond Index, the Fund's benchmark, but with a superior,
call-protected structure. As of September 30, the Fund's average effective
maturity was 10 years.
The Fund's overall quality remains high, with 84% of portfolio securities rated
A or better as of September 30. We continue to invest in a broad selection of
Ohio municipal bonds, including general obligation, hospital/health, and sales
and special tax bonds.
An Emphasis on Income and
Competitive Performance
The Fund seeks to provide investors with a high level of federal and state
tax-exempt income as well as competitive total returns. We pursue the Fund's
objective by concentrating on three broad categories of Ohio municipal bonds:
o Noncallable bonds, which an issuer cannot redeem before the maturity date.
When interest rates fall, bond issuers tend to reduce their borrowing expenses
by redeeming "callable" existing bonds and issuing new securities that pay lower
interest rates. Noncallable bonds provide a relatively stable stream of income
and solid price appreciation potential over time. During the period, we sold
bonds with weak call protection in favor of those with better call protection.
As of September 30, 39% of bonds held by the Fund were noncallable.
o Steeply discounted callable bonds, which are unlikely to be subject to early
redemption at par value by their issuers.
o "Cushion" bonds. We balance the Fund's long-maturity bonds by purchasing
so-called cushion bonds -- bonds with high coupons that compensate investors for
the fact that they can be redeemed by their issuer in a relatively short time.
A Further Slowdown?
The U.S. economy is flashing several caution lights. Some companies -- notably
fast food outlets and department stores -- are attempting to interest their
customers in higher priced items. That these and other companies are even
considering raising prices makes us believe that the economy may slow further,
because we are confident that the Federal Reserve will raise interest rates at
the first signs of any uptick in inflation. Though we believe that any excesses
in the U.S. economy would soon be corrected, and that the economy will remain
8 - SCUDDER OHIO TAX FREE FUND
<PAGE>
resilient, any further slowdown should benefit the municipal bond market.
Meanwhile, as managers we will retain our focus on noncallable,
intermediate-maturity tax-free bonds, because we believe they offer the most
attractive balance of return and risk. We will continue to maintain a neutral
average maturity for the Fund and pay close attention to credit quality as we
pursue double tax-free income and competitive total return for Scudder Ohio Tax
Free Fund shareholders.
Sincerely,
Your Portfolio Management Team
/s/Donald C. Carleton /s/Philip G. Condon
Donald C. Carleton Philip G. Condon
9 - SCUDDER OHIO TAX FREE FUND
<PAGE>
<TABLE>
INVESTMENT PORTFOLIO as of September 30, 1996 (Unaudited)
<CAPTION>
PRINCIPAL CREDIT MARKET
AMOUNT($) RATING(B) VALUE($)
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
SHORT-TERM MUNICIPAL INVESTMENTS 3.3%
- ----------------------------------------------------------------------------------------------------------------------------
OHIO
Cuyahoga County, OH, Health & Education, University Hospital of Cleveland,
Daily Demand Note, 3.95%, 1/1/16* ................................................... 1,300,000 MIG1 1,300,000
Hamilton Health Systems, Franciscan Sisters of the Poor Health Systems, Series
A, Daily Demand Note, 3.95%, 3/1/17* ................................................ 1,500,000 MIG1 1,500,000
- ----------------------------------------------------------------------------------------------------------------------------
Total Short-term Municipal Investments (Cost $2,800,000) ............................. 2,800,000
- ----------------------------------------------------------------------------------------------------------------------------
LONG-TERM MUNICIPAL INVESTMENTS 96.7%
- ----------------------------------------------------------------------------------------------------------------------------
OHIO
Cleveland, OH, Waterworks Improvement, First Mortgage Revenue, Series 1992
F, 6.25%, 1/1/07(c) ................................................................. 1,000,000 AAA 1,073,420
Cleveland, OH, Public Power System Improvement Revenue, Series 1994 A,
Zero Coupon, 11/15/09(c) ............................................................ 2,250,000 AAA 1,119,465
Cleveland, OH, Urban Renewal Tax Increment Rock & Roll Hall of Fame and
Museum Project, 6.75%, 3/15/18 ...................................................... 1,000,000 NR 1,017,330
Cleveland, OH, General Obligation:
Series A, 6.3%, 7/1/06(c) ........................................................... 1,000,000 AAA 1,085,540
5.3%, 9/1/08 (c) .................................................................... 2,000,000 AAA 2,004,820
Series 1993, 5.375%, 9/1/09(c) ...................................................... 1,700,000 AAA 1,701,496
Cleveland, OH, Public Power System Improvement Revenue, Series B, 7%, 11/15/17 ....... 750,000 BBB 794,678
Cleveland, Ohio, Parking Facility Revenue, 6%, 9/15/09(c) ............................ 1,385,000 AAA 1,463,017
Columbus, OH, General Obligation:
Unlimited Tax, Sewer Improvement, 6%, 5/1/13 ........................................ 1,000,000 AAA 1,026,910
Limited Tax, Various Purpose, Series 1993, 5.25%, 9/15/11 ........................... 1,000,000 AAA 1,004,230
Cuyahoga County, OH, General Obligation, Jail Facilities:
5%, 10/1/08(c) ...................................................................... 4,180,000 AAA 4,087,789
Series 1991, ETM, Zero Coupon, 10/1/02** ............................................ 1,500,000 AA 1,121,070
Cuyahoga County, OH, Hospital Facilities Revenue, Health Cleveland Inc.,
Series 1993, 6.25%, 8/15/10 ......................................................... 1,000,000 A 1,012,900
Fairfield, OH, City School District, 7.2%, 12/1/09(c) ................................ 1,000,000 AAA 1,176,770
Franklin County, OH, Riverside United Methodist Hospital, 5.75%, 5/15/12 ............. 1,950,000 AA 1,939,919
Gateway Economic Development Corporation of Cleveland, OH, Stadium Revenue,
6.5%, 9/15/14 ....................................................................... 4,000,000 NR 3,999,840
Gateway Economic Development Corporation of Cuyahoga County, OH, Excise Tax,
Series 1990, 7.5%, 9/1/05 ........................................................... 1,000,000 A 1,108,660
Gateway Economic Development Corporation of Greater Cleveland, OH, Excise Tax,
Series 1990, 7.2%, 9/1/01 ........................................................... 2,550,000 A 2,689,587
</TABLE>
The accompanying notes are an integral part of the financial statements.
- --------------------------------------------------------------------------------
Pure No-Load[Trademark] Funds Pure No-Load[Trademark] Funds Pure No-Load[Tradema
- --------------------------------------------------------------------------------
10 - SCUDDER OHIO TAX FREE FUND
<PAGE>
<TABLE>
<CAPTION>
PRINCIPAL CREDIT MARKET
AMOUNT($) RATING(B) VALUE($)
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Hamilton County, OH, Sewer System Revenue, Series 1991 A:
6.4%, 12/1/05 ....................................................................... 530,000 AA 566,639
6.4%, 12/1/05, Prerefunded 6/1/01** 220,000 AA 239,138
Hamilton County, OH, Health System Revenue, Franciscan Sisters of the Poor
Health System, Providence Hospital, Series 1992, 6.8%, 7/1/08 ....................... 2,000,000 BBB 2,058,240
Hamilton County, OH, Sewer System Revenue, Improvement and Refunding,
5.45%, 12/1/09(c) ................................................................... 1,000,000 AAA 1,008,910
Hamilton County, OH, General Obligation, 5.1%, 12/1/11 ............................... 1,000,000 AA 955,170
Hamilton County, OH, Hospital Facilities Revenue, Christ Hospital, Series 1991
B, 6.625%, 1/1/06(c) ................................................................ 1,000,000 AAA 1,068,170
Hilliard, OH, School District, Series 1996A, Zero Coupon, 12/1/12(c) ................. 1,655,000 AAA 681,628
Huber Heights, OH, Water System Revenue, Zero Coupon, 12/1/12 ........................ 1,005,000 AAA 413,919
Lorain County, OH, Hospital Refunding Revenue:
EMH Regional Medical Center, 5%, 11/1/07(c) ......................................... 1,000,000 AAA 976,680
Humility of Mary Health Care System, Series A, 5.9%, 12/15/08 ....................... 1,000,000 A 994,740
Lorain, OH, Hospital Authority Refunding Revenue, Lakeland Community
Hospital Inc., 6.5%, 11/15/12 ....................................................... 1,000,000 A 1,025,880
Lucas County, OH, Hospital Revenue, Flower Hospital, Series 1993, 6.125%, 12/1/13 .... 1,375,000 BBB 1,496,426
Lucas County, OH, Hospital Revenue, St. Vincent Medical Center, 5.25%, 8/15/20(c) .... 1,900,000 AAA 1,765,708
Mahoning County, OH, General Obligation, Limited Tax, 6.6%, 12/1/06(c) ............... 1,100,000 AAA 1,213,212
Miami County, Ohio, Hospital Upper Valley C06 Series 1996 C, 6.25%, 5/15/13 .......... 1,000,000 BBB 986,000
North Olmsted, OH, General Obligation, 6.25%, 12/15/12(c) ............................ 1,500,000 AAA 1,575,375
Northeast Ohio Regional Sewer District, Wastewater Improvement Revenue Refunding:
5.5%, 11/15/12(c) ................................................................... 1,550,000 AAA 1,543,335
5.6%, 11/15/13(c) ................................................................... 1,000,000 AAA 1,001,570
Ohio Air Quality Development Authority, Pollution Control Revenue, Cleveland
Electric Company, 8%, 12/1/13(c) .................................................... 1,250,000 AAA 1,477,088
Ohio General Obligation, 6%, 8/1/10 .................................................. 1,000,000 AA 1,052,870
Ohio Higher Education Facilities Revenue:
Oberlin College Project, 7.1%, 10/1/12, Prerefunded 10/1/99 ** ...................... 490,000 AAA 525,094
University of Dayton Project, 7.25%, 12/1/12(c) ..................................... 1,000,000 AAA 1,116,770
John Carroll University, Series B, 5.3%, 11/15/14 ................................... 1,000,000 A 967,150
Case Western Reserve University, Series B, 6.5%, 10/1/20 ............................ 2,250,000 AA 2,521,958
Ohio Housing Finance Agency, Single-Family Mortgage Revenue, Series 1990 F,
7.6%, 9/1/16 ........................................................................ 1,485,000 AAA 1,575,897
Ohio Liquor Profits Refunding Bonds, Economic Development Revenue, Series 1989,
6.85%, 3/1/00(c) .................................................................... 1,000,000 AAA 1,072,620
</TABLE>
The accompanying notes are an integral part of the financial statements.
- --------------------------------------------------------------------------------
Pure No-Load[Trademark] Funds Pure No-Load[Trademark] Funds Pure No-Load[Tradema
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11 - SCUDDER OHIO TAX FREE FUND
<PAGE>
<TABLE>
<CAPTION>
PRINCIPAL CREDIT MARKET
AMOUNT($) RATING(B) VALUE($)
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Ohio Mortgage Revenue, International Order of Odd Fellows Home, 8.15%, 8/1/17(c) 150,000 AAA 158,036
Ohio Public Facilities Commission, Higher Educational Capital Facilities Revenue,
Series 2B, 5.4%, 11/1/07(c) 2,000,000 AAA 2,020,980
Ohio State Building Authority:
Correctional Facilities Revenue, Series 1991 A, 6.5%, 10/1/04 1,000,000 AA 1,088,260
Juvenile Correction Facilities, 6%, 10/1/06 1,555,000 AA 1,654,815
Toledo Government Office Building, Series A, 8%, 10/1/27, Prerefunded 4/1/03** 500,000 AAA 587,860
Worker's Compensation Facilities, William Green Building, Series 1993 A, 4.75%,
4/1/14 1,000,000 AA 887,530
Ohio Water Development Authority, Pollution Control Revenue, Ohio Edison
Company Project, Series 1989 A, 7.625%, 7/1/23 1,140,000 BB 1,198,072
Olmsted Falls, OH, City School District, General Obligation, Series 1991, 7.05%,
12/15/11(c) 1,000,000 AAA 1,115,180
Parma, OH, General Obligation, 5.4%, 12/1/11 1,000,000 AAA 998,070
Solon, OH, School District, 5.3%, 12/1/13 1,000,000 AA 964,960
Summit County, OH, General Obligation, 6.4%, 12/1/14(c) 1,000,000 AAA 1,066,890
Warren County, OH, Water Improvement, General Obligation, The P&G Project,
Series 1995, 5.25%, 12/1/16 1,720,000 AA 1,633,704
PUERTO RICO
Puerto Rico Aqueduct and Sewer Authority, 6%, 7/1/09 1,000,000 A 1,033,240
Puerto Rico Electric Power Authority, Power Revenue, Series S, 6.125%, 7/1/09 2,000,000 BBB 2,089,020
Puerto Rico, General Obligation, Public Improvement Refunding, 5.4%, 7/1/07 1,500,000 A 1,492,620
Puerto Rico, General Obligation, Public Improvement, 6.6%, 7/1/13, Prerefunded
7/1/07 (c)** 1,000,000 AAA 1,112,400
University of Puerto Rico, University Systems, Series N, 6.25%, 6/1/08(c) 1,000,000 AAA 1,092,740
VIRGIN ISLANDS
Virgin Islands Public Finance Authority:
General Obligation, Matching Fund Loan Notes, Series A, 7.25%, 10/1/18 1,000,000 NR 1,068,422
Highway Revenue, Series 1989, 7.7%, 10/1/04 1,000,000 BBB 1,081,170
- ----------------------------------------------------------------------------------------------------------------------------
Total Long-term Municipal Investments (Cost $78,150,741) 81,651,597
- ----------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------
Total Investment Portfolio -- 100.0% (Cost $80,950,741)(a) 84,451,597
- ----------------------------------------------------------------------------------------------------------------------------
(a) The cost for federal income tax purposes was $80,950,741. At September 30, 1996, net unrealized appreciation for all
securities based on tax cost was $3,500,856. This consisted of aggregate gross unrealized appreciation for all
securities in which there was an excess of market value over tax cost of $3,667,289 and aggregate gross unrealized
depreciation for all securities in which there was an excess of tax cost over market value of $166,433.
</TABLE>
The accompanying notes are an integral part of the financial statements.
- --------------------------------------------------------------------------------
Pure No-Load[Trademark] Funds Pure No-Load[Trademark] Funds Pure No-Load[Tradema
- --------------------------------------------------------------------------------
12 - SCUDDER OHIO TAX FREE FUND
<PAGE>
- --------------------------------------------------------------------------------
(b) All of the securities held have been determined to be of appropriate credit
quality as required by the Fund's investment objectives. Credit ratings
shown are assigned by either Standard & Poor's Ratings Group, Moody's
Investors Service, Inc. or Fitch Investors Service, Inc. Unrated securities
(NR) have been determined to be of comparable quality to rated eligible
securities.
(c) Bond is insured by one of these companies: AMBAC, FGIC, FHA or MBIA.
* Floating rate and monthly, weekly, or daily demand notes are securities
whose yields vary with a designated market index or market rate, such as
the coupon-equivalent of the Treasury bill rate. Variable rate demand notes
are securities whose yields are periodically reset at levels that are
generally comparable to tax-exempt commercial paper. These securities are
payable on demand within seven calendar days and normally incorporate an
irrevocable letter of credit from a major bank. These notes are carried,
for purposes of calculating average weighted maturity, at the longer of the
period remaining until the next rate change or to the extent of the demand
period.
** Prerefunded: Bonds which are prerefunded are collateralized by U.S.
Treasury securities which are held in escrow and are used to pay principal
and interest on the tax-exempt issue and to retire the bonds in full at the
earliest refunding date.
*** ETM: Bonds bearing the description ETM (escrowed to maturity) are
collateralized by U.S. Treasury securities which are held in escrow by a
trustee and used to pay principal and interest on bonds so designated.
The accompanying notes are an integral part of the financial statements.
- --------------------------------------------------------------------------------
Pure No-Load[Trademark] Funds Pure No-Load[Trademark] Funds Pure No-Load[Tradema
- --------------------------------------------------------------------------------
13 - SCUDDER OHIO TAX FREE FUND
<PAGE>
<TABLE>
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
As of September 30, 1996 (Unaudited)
<CAPTION>
<S> <C> <C>
ASSETS
- --------------------------------------------------------------------------------------------------------------------
Investments, at market (identified cost $80,950,741) (Note A) .............. $84,451,597
Cash ....................................................................... 14,647
Receivable for investments sold ............................................ 5,000
Interest receivable ........................................................ 1,320,953
Receivable on Fund shares sold ............................................. 81,425
Other assets ............................................................... 82
-----------
Total assets ............................................................... 85,873,704
LIABILITIES
- --------------------------------------------------------------------------------------------------------------------
Dividends payable .......................................................... $ 133,168
Payable for Fund shares redeemed ........................................... 59,779
Accrued management fee (Note C) ............................................ 16,897
Other accrued expenses (Note C) ............................................ 46,394
-----------
Total liabilities .......................................................... 256,238
-------------------------------------------------------------------------------------------
Net assets, at market value ................................................ $85,617,466
-------------------------------------------------------------------------------------------
NET ASSETS
- --------------------------------------------------------------------------------------------------------------------
Net assets consist of:
Unrealized appreciation on investments ..................................... 3,500,856
Accumulated net realized loss .............................................. (176,186)
Shares of beneficial interest .............................................. 65,659
Additional paid-in capital ................................................. 82,227,137
-------------------------------------------------------------------------------------------
Net assets, at market value ................................................ $85,617,466
-------------------------------------------------------------------------------------------
NET ASSET VALUE
- --------------------------------------------------------------------------------------------------------------------
Net Asset Value, offering and redemption price per share ($85,617,466/
6,565,875 outstanding shares of beneficial interest, $.01 par value, -----------
unlimited number of shares authorized) ................................... $13.04
-----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
- --------------------------------------------------------------------------------
Pure No-Load[Trademark] Funds Pure No-Load[Trademark] Funds Pure No-Load[Tradema
- --------------------------------------------------------------------------------
14 - SCUDDER OHIO TAX FREE FUND
<PAGE>
<TABLE>
STATEMENT OF OPERATIONS
SIX MONTHS ENDED SEPTEMBER 30, 1996 (UNAUDITED)
<CAPTION>
<S> <C> <C>
INVESTMENT INCOME
- -------------------------------------------------------------------------------------------------------------------
Income:
Interest ................................................................... $2,425,608
----------
Expenses:
Management fee (Note C) .................................................... $ 252,425
Services to shareholders (Note C) .......................................... 40,438
Custodian and accounting fees (Note C) ..................................... 31,900
Trustees' fees and expenses (Note C) ....................................... 8,542
Auditing ................................................................... 15,850
Reports to shareholders .................................................... 12,418
Legal ...................................................................... 2,925
Registration fees .......................................................... 3,077
Other ...................................................................... 2,664
----------
Total expenses before reductions ........................................... 370,239
Expense reductions (Note C) ................................................ (158,880)
----------
Expenses, net .............................................................. 211,359
------------------------------------------------------------------------------------------
Net investment income ...................................................... 2,214,249
------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN ON INVESTMENT TRANSACTIONS
- -------------------------------------------------------------------------------------------------------------------
Net realized gain from investment transactions ............................. 9,575
Net unrealized appreciation on investments during the period ............... 569,588
----------
Net gain on investments .................................................... 579,163
------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations ....................... $2,793,412
------------------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
- --------------------------------------------------------------------------------
Pure No-Load[Trademark] Funds Pure No-Load[Trademark] Funds Pure No-Load[Tradema
- --------------------------------------------------------------------------------
15 - SCUDDER OHIO TAX FREE FUND
<PAGE>
<TABLE>
STATEMENTS OF CHANGES IN NET ASSETS
<CAPTION>
SIX MONTHS
ENDED
SEPTEMBER 30, YEAR ENDED
1996 MARCH 31,
INCREASE (DECREASE) IN NET ASSETS (UNAUDITED) 1996
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Operations:
Net investment income ................................................ $ 2,214,249 $ 4,292,314
Net realized gain from investment transactions ....................... 9,575 778,640
Net unrealized appreciation on investments during the period ......... 569,588 984,684
----------- -----------
Net increase in net assets resulting from operations ................. 2,793,412 6,055,638
----------- -----------
Distributions to shareholders:
From net investment income ........................................... (2,214,249) (4,292,314)
----------- -----------
From net realized gains from investment transactions ................. -- (708,420)
----------- -----------
Fund share transactions:
Proceeds from shares sold ............................................ 8,200,406 9,467,393
Net asset value of shares issued to shareholders in reinvestment
of distributions ................................................... 1,411,678 3,377,267
Cost of shares redeemed .............................................. (8,223,492) (8,635,781)
----------- -----------
Net increase in net assets from Fund share transactions .............. 1,388,592 4,208,879
----------- -----------
Increase in net assets ............................................... 1,967,755 5,263,783
Net assets at beginning of period .................................... 83,649,711 78,385,928
----------- -----------
Net assets at end of period .......................................... $85,617,466 $83,649,711
----------- -----------
OTHER INFORMATION
- -------------------------------------------------------------------------------------------------------------------------
INCREASE (DECREASE) IN FUND SHARES
Shares outstanding at beginning of period ............................ 6,457,717 6,140,345
----------- -----------
Shares sold .......................................................... 635,968 720,794
Shares issued to shareholders in reinvestment of distributions ....... 109,143 258,369
Shares redeemed ...................................................... (636,953) (661,791)
----------- -----------
Net increase in Fund shares .......................................... 108,158 317,372
----------- -----------
Shares outstanding at end of period .................................. 6,565,875 6,457,717
----------- -----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
- --------------------------------------------------------------------------------
Pure No-Load[Trademark] Funds Pure No-Load[Trademark] Funds Pure No-Load[Tradema
- --------------------------------------------------------------------------------
16 - SCUDDER OHIO TAX FREE FUND
<PAGE>
<TABLE>
FINANCIAL HIGHLIGHTS
The following table includes select data for a share outstanding throughout each period and other performance information derived
from the financial statements.
<CAPTION>
FOR THE PERIOD
SIX MONTHS MAY 28, 1987
ENDED (COMMENCEMENT
SEPTEMBER 30, OF OPERATIONS)
1996 YEARS ENDED MARCH 31, TO MARCH 31,
(UNAUDITED) 1996 1995 1994 1993 1992 1991 1990 1989 1988
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, ------------------------------------------------------------------------------------------------
beginning of period ......... $12.95 $12.77 $12.68 $13.13 $12.47 $12.14 $11.97 $11.94 $11.65 $12.00
------------------------------------------------------------------------------------------------
Income from investment
operations:
Net investment income ......... .34 .69 .70 .70 .72 .75 .78 .82 .79 .66
Net realized and
unrealized gain (loss)
on investments .............. .09 .30 .13 (.35) .85 .36 .23 .10 .36 (.40)
Total from investment ------------------------------------------------------------------------------------------------
operations .................. .43 .99 .83 .35 1.57 1.11 1.01 .92 1.15 .26
------------------------------------------------------------------------------------------------
Less distributions from:
------------------------------------------------------------------------------------------------
Net investment income ......... (.34) (.69) (.70) (.70) (.72) (.75) (.78) (.82) (.84) (.61)
Net realized gains on
investment transactions ....... -- (.12) -- (.08) (.19) (.03) (.06) (.07) (.02) --
In excess of net realized
gains ....................... -- -- (.04) (.02) -- -- -- -- -- --
------------------------------------------------------------------------------------------------
Total distributions ........... (.34) (.81) (.74) (.80) (.91) (.78) (.84) (.89) (.86) (.61)
Net asset value, end of ------------------------------------------------------------------------------------------------
period ...................... $13.04 $12.95 $12.77 $12.68 $13.13 $12.47 $12.14 $11.97 $11.94 $11.65
------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN(%)(A) ............ 3.37** 7.85 6.82 2.48 13.04 9.33 8.75 7.80 10.83 2.30**
RATIOS AND SUPPLEMENTAL
DATA
Net assets, end of period
($ millions) ................ 86 84 78 80 69 51 37 25 12 6
Ratio of operating expenses,
net to average daily net
assets(%)(a) ................ .50* .50 .50 .50 .50 .50 .50 .50 .50 .50*
Ratio of operating expenses
before expense reductions,
to average daily net
assets (%) .................. .88* .89 .91 .90 .95 1.03 1.21 1.62 2.14 4.51*
Ratio of net investment
income to average daily
net assets (%) .............. 5.26* 5.30 5.59 5.23 5.61 6.05 6.50 6.74 7.13 7.17*
Portfolio turnover rate (%) ... 1.53* 19.6 19.9 12.2 34.7 13.2 22.6 15.9 35.7 105.5*
(a) Total returns are higher due to maintenance of the Fund's expenses.
* Annualized
** Not annualized
</TABLE>
- --------------------------------------------------------------------------------
Pure No-Load[Trademark] Funds Pure No-Load[Trademark] Funds Pure No-Load[Tradema
- --------------------------------------------------------------------------------
17 - SCUDDER OHIO TAX FREE FUND
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Unaudited)
A. SIGNIFICANT ACCOUNTING POLICIES
Scudder Ohio Tax Free Fund (the "Fund") is a non-diversified series of Scudder
State Tax Free Trust (the "Trust"). The Trust is organized as a Massachusetts
business trust and is registered under the Investment Company Act of 1940, as
amended, as an open-end management investment company. There are currently six
series in the Trust.
The Fund's financial statements are prepared in accordance with generally
accepted accounting principles which require the use of management estimates.
The policies described below are followed consistently by the Fund in the
preparation of its financial statements.
SECURITY VALUATION. Portfolio debt securities with remaining maturities greater
than sixty days are valued by pricing agents approved by the Officers of the
Fund, which quotations reflect broker/dealer-supplied valuations and electronic
data processing techniques. If the pricing agents are unable to provide such
quotations, the most recent bid quotation supplied by a bona fide market maker
shall be used. All other debt securities are valued at their fair value as
determined in good faith by the Valuation Committee of the Board of Trustees.
Short-term investments having a maturity of sixty days or less are valued at
amortized cost.
AMORTIZATION AND ACCRETION. All premiums and original issue discounts are
amortized/accreted for both tax and financial reporting purposes.
FEDERAL INCOME TAXES. The Fund's policy is to comply with the requirements of
the Internal Revenue Code which are applicable to regulated investment companies
and to distribute all of its taxable and tax-exempt income to its shareholders.
Accordingly, the Fund paid no federal income taxes and no provision for federal
income taxes was required.
DISTRIBUTION OF INCOME AND GAINS. All of the net investment income of the Fund
is declared as a dividend to shareholders of record as of the close of business
each day and is paid to shareholders monthly. During any particular year, net
realized gains from investment transactions, in excess of available capital loss
carryforwards, would be taxable to the Fund if not distributed and, therefore,
will be distributed to shareholders. An additional distribution may be made to
the extent necessary to avoid the payment of a four percent federal excise tax.
The timing and characterization of certain income and capital gains
distributions are determined in accordance with federal tax regulations which
may differ from generally accepted accounting principles. As a result, net
investment income and net realized gain (loss) on investment transactions for a
reporting period may differ significantly from distributions during such period.
Accordingly, the Fund may periodically make reclassifications among certain of
its capital accounts without impacting the net asset value of the Fund.
The Fund uses the specific identification method for determining realized gain
or loss on investments for both financial and federal income tax reporting
purposes.
OTHER. Investment security transactions are accounted for on a trade date basis.
Distributions of net realized gains to shareholders are recorded on the
ex-dividend date. Interest income is accrued pro rata to the earlier of the call
or maturity date.
B. PURCHASES AND SALES OF SECURITIES
During the six months ended September 30, 1996, purchases and sales of municipal
securities (excluding short-term investments) aggregated $2,441,483 and
$610,000, respectively.
- --------------------------------------------------------------------------------
Pure No-Load[Trademark] Funds Pure No-Load[Trademark] Funds Pure No-Load[Tradema
- --------------------------------------------------------------------------------
18 - SCUDDER OHIO TAX FREE FUND
<PAGE>
C. RELATED PARTIES
Under the Fund's Investment Advisory Agreement (the "Agreement") with Scudder,
Stevens & Clark, Inc. (the "Adviser"), the Fund agrees to pay the Adviser a fee
equal to an annual rate of approximately 0.60% of the Fund's average daily net
assets, computed and accrued daily and payable monthly. The Adviser determines
the securities, instruments, and other contracts relating to investments to be
purchased, sold or entered into by the Fund. In addition to portfolio management
services, the Adviser provides certain administrative services in accordance
with the Agreement. The Adviser has agreed not to impose all or a portion of its
management fee until July 31, 1997 and during such period to maintain the
annualized expenses of the Fund at not more than 0.50% of average daily net
assets. For the six months ended September 30, 1996, the Adviser imposed fees
amounting to $93,545 and the portion not imposed amounted to $158,880 at
September 30, 1996.
Scudder Service Corporation ("SSC"), a subsidiary of the Adviser, is the
transfer, dividend-paying and shareholder service agent for the Fund. For the
six months ended September 30, 1996, the amount charged to the Fund by SSC
aggregated $28,409 of which $4,695 is unpaid at September 30, 1996.
Scudder Fund Accounting Corporation ("SFAC"), a subsidiary of the Adviser, is
responsible for determining the daily net asset value per share and maintaining
the portfolio and general accounting records of the Fund. For the six months
ended September 30, 1996, the amount charged to the Fund by SFAC aggregated
$18,000, of which $3,000 was unpaid at September 30, 1996.
The Trust pays each Trustee not affiliated with the Adviser $12,000 annually,
divided equally among the series of the Trust, plus specified amounts for
attended board and committee meetings. For the six months ended September 30,
1996, Trustees' fees and expenses charged to the Fund aggregated $8,542.
- --------------------------------------------------------------------------------
Pure No-Load[Trademark] Funds Pure No-Load[Trademark] Funds Pure No-Load[Tradema
- --------------------------------------------------------------------------------
19 - SCUDDER OHIO TAX FREE FUND
<PAGE>
This Page
intentionally
left blank.
20 - SCUDDER OHIO TAX FREE FUND
<PAGE>
Officers and Trustees
David S. Lee*
President and Trustee
Henry P. Becton, Jr.
Trustee; President and General Manager, WGBH Educational Foundation
Dawn-Marie Driscoll
Trustee; Attorney and Corporate Director
Peter B. Freeman
Trustee; Corporate Director and Trustee
Dudley H. Ladd*
Trustee
Wesley W. Marple, Jr.
Trustee; Professor of Business Administration, Northeastern University
Juris Padegs*
Trustee
Daniel Pierce*
Trustee
Jean C. Tempel
Trustee; General Partner,
TL Ventures
Donald C. Carleton*
Vice President
Philip G. Condon*
Vice President
Jerard K. Hartman*
Vice President
Thomas W. Joseph*
Vice President
Thomas F. McDonough*
Vice President and Secretary
Pamela A. McGrath*
Vice President and Treasurer
Edward J. O'Connell*
Vice President and Assistant Treasurer
Jeremy L. Ragus*
Vice President
Rebecca Wilson*
Vice President
Coleen Downs Dinneen*
Assistant Secretary
* Scudder, Stevens & Clark, Inc.
21 - SCUDDER OHIO TAX FREE FUND
<PAGE>
Investment Products and Services
The Scudder Family of Funds
- ---------------------------
Money Market
Scudder Cash Investment Trust
Scudder U.S. Treasury Money Fund
Tax Free Money Market+
Scudder Tax Free Money Fund
Scudder California Tax Free Money Fund*
Scudder New York Tax Free Money Fund*
Tax Free+
Scudder California Tax Free Fund*
Scudder High Yield Tax Free Fund
Scudder Limited Term Tax Free Fund
Scudder Managed Municipal Bonds
Scudder Massachusetts Limited Term
Tax Free Fund*
Scudder Massachusetts Tax Free Fund*
Scudder Medium Term Tax Free Fund
Scudder New York Tax Free Fund*
Scudder Ohio Tax Free Fund*
Scudder Pennsylvania Tax Free Fund*
Growth and Income
Scudder Balanced Fund
Scudder Growth and Income Fund
Income
Scudder Emerging Markets Income Fund
Scudder Global Bond Fund
Scudder GNMA Fund
Scudder High Yield Bond Fund
Scudder Income Fund
Scudder International Bond Fund
Scudder Short Term Bond Fund
Scudder Zero Coupon 2000 Fund
Growth
Scudder Capital Growth Fund
Scudder Classic Growth Fund
Scudder Development Fund
Scudder Emerging Markets Growth Fund
Scudder Global Discovery Fund
Scudder Global Fund
Scudder Gold Fund
Scudder Greater Europe Growth Fund
Scudder International Fund
Scudder Latin America Fund
Scudder Micro Cap Fund
Scudder Pacific Opportunities Fund
Scudder Quality Growth Fund
Scudder Small Company Value Fund
Scudder 21st Century Growth Fund
Scudder Value Fund
The Japan Fund
Retirement Plans and Tax-Advantaged Investments
- -----------------------------------------------
IRAs
Keogh Plans
Scudder Horizon Plan*+++ (a variable annuity)
401(k) Plans
403(b) Plans
SEP-IRAs
Profit Sharing and Money Purchase
Pension Plans
Closed-End Funds#
- -----------------
The Argentina Fund, Inc.
The Brazil Fund, Inc.
The First Iberian Fund, Inc.
The Korea Fund, Inc.
The Latin America Dollar Income Fund, Inc.
Montgomery Street Income Securities, Inc.
Scudder New Asia Fund, Inc.
Scudder New Europe Fund, Inc.
Scudder World Income Opportunities
Fund, Inc.
Institutional Cash Management
- -----------------------------
Scudder Institutional Fund, Inc.
Scudder Fund, Inc.
Scudder Treasurers Trust(TM)++
For complete information on any of the above Scudder funds, including management
fees and expenses, call or write for a free prospectus. Read it carefully before
you invest or send money. +A portion of the income from the tax-free funds may
be subject to federal, state, and local taxes. *Not available in all states.
+++A no-load variable annuity contract provided by Charter National Life
Insurance Company and its affiliate, offered by Scudder's insurance agencies,
1-800-225-2470. #These funds, advised by Scudder, Stevens & Clark, Inc., are
traded on various stock exchanges. ++For information on Scudder Treasurers
Trust,(TM) an institutional cash management service that utilizes certain
portfolios of Scudder Fund, Inc. ($100,000 minimum), call 1-800-541-7703.
22 - SCUDDER OHIO TAX FREE FUND
<PAGE>
How to Contact Scudder
Account Service and Information
- --------------------------------------------------------------------------------
For existing account service and transactions
Scudder Investor Relations
1-800-225-5163
For personalized information about your Scudder accounts;
exchanges and redemptions; or information on any Scudder fund
Scudder Automated Information Line (SAIL)
1-800-343-2890
Investment Information
- --------------------------------------------------------------------------------
To receive information about the Scudder funds, for additional
applications and prospectuses, or for investment questions
Scudder Investor Relations
1-800-225-2470
For establishing 401(k) and 403(b) plans
Scudder Defined Contribution Services
1-800-323-6105
Please address all correspondence to
- --------------------------------------------------------------------------------
The Scudder Funds
P.O. Box 2291
Boston, Massachusetts
02107-2291
Visit the Scudder World Wide Web Site at:
- --------------------------------------------------------------------------------
http://funds.scudder.com
Or Stop by a Scudder Funds Center
- --------------------------------------------------------------------------------
Many shareholders enjoy the personal, one-on-one service of the
Scudder Funds Centers. Check for a Funds Center near you--they
can be found in the following cities:
Boca Raton New York
Boston Portland, OR
Chicago San Diego
Cincinnati San Francisco
Los Angeles Scottsdale
For information on Scudder Treasurers Trust(TM), an
institutional cash management service for corporations,
non-profit organizations and trusts which utilizes certain
portfolios of Scudder Fund, Inc.* ($100,000 minimum), call:
1-800-541-7703.
For information on Scudder Institutional Funds*, funds designed
to meet the broad investment management and service needs of
banks and other institutions, call:
1-800-854-8525.
Scudder Investor Relations and Scudder Funds Centers are services provided
through Scudder Investor Services, Inc., Distributor.
* Contact Scudder Investor Services, Inc., Distributor, to receive a prospectus
with more complete information, including management fees and expenses. Please
read it carefully before you invest or send money.
23 - SCUDDER OHIO TAX FREE FUND
<PAGE>
Celebrating Over 75 Years of Serving Investors
Established in 1919 by Theodore Scudder, Sidney Stevens, and F. Haven Clark,
Scudder, Stevens & Clark was the first independent investment counsel firm in
the United States. Since its birth, Scudder's pioneering spirit and commitment
to professional long-term investment management have helped shape the investment
industry. In 1928, we introduced the nation's first no-load mutual fund. Today
we offer over 40 pure no load(TM) funds, including the first international
mutual fund offered to U.S. investors.
Over the years, Scudder's global investment perspective and dedication to
research and fundamental investment disciplines have helped us become one of the
largest and most respected investment managers in the world. Though times have
changed since our beginnings, we remain committed to our long-standing
principles: managing money with integrity and distinction; keeping the interests
of our clients first; providing access to investments and markets that may not
be easily available to individuals; and making investing as simple and
convenient as possible through friendly, comprehensive service.
This information must be preceded or accompanied by a current prospectus.
Portfolio changes should not be considered recommendations for action by
individual investors.
