[Image] Scudder Massachusetts Tax Free Fund Profile [Image]
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The fund profile, a supplement to the full prospectus, is designed as
an easy-to-read summary of fund risks, fees, and objectives. You can
click on any question to link to the Fund's prospectus and get more
information on that topic. Or, if you wish, you can proceed directly
to the Fund's prospectus. Once you have read the prospectus and
considered your investment goals, you can proceed to a Scudder Funds
application.
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Fund Profile
April 1, 1997
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1. What Is The Fund's Objective?
Scudder Massachusetts Tax Free Fund is a non-diversified fund that
seeks to provide Massachusetts taxpayers with income exempt from both
Massachusetts personal income tax and regular federal income tax.
2. What Does The Fund Invest In?
The Fund invests primarily (at least 80% of net assets) in long-term
(more than 10 years) investment-grade municipal securities, including
municipal bonds, variable rate demand instruments and municipal notes,
of issuers located in Massachusetts and other qualifying issuers
(including Puerto Rico, the U.S. Virgin Islands and Guam).
At least 75% of the Fund's municipal securities will be
investment-grade: rated Aaa, Aa or Baa by Moody's Investors Service,
Inc. or BBB by Standard & Poor's or Fitch Investors Service, Inc. or
their equivalent. The Fund may not invest in fixed-income securities
rated below B by Moody's, S&P, or Fitch, or their equivalent.
3. What Are The Risks Of Investing In The Fund?
While the Fund invests primarily in investment-grade bonds, the Fund
is still exposed to market risk and changes in interest rates.
Consequently, the Fund's share price and yield are likely to vary from
day to day. There is also a possibility the rating of a security held
by the Fund may be downgraded after it is purchased. This decrease in
rating may be the result of the inability of the state of
Massachusetts or any of its local government entities to meet its
financial obligations. You incur principal risk when you invest
because your shares, when sold, may be worth more or less than what
you paid for them.
Because it is non-diversified, the Fund may invest a smaller number of
issuers, which will subject it to greater market and credit risks than
a diversified fund.
4. For Whom Is This Fund Appropriate?
You may wish to consider this Fund if you are seeking double tax-free
income -- exempt both from Massachusetts personal income tax and
regular federal income tax. Depending on your tax bracket and
individual situation, you may earn a substantially higher after-tax
return from the Fund than from comparable investments that pay income
subject to both Massachusetts state personal income tax and regular
federal income tax.
5. What Are The Fund's Expenses And Fees?
There are two kinds of expenses that a shareholder may incur, directly
or indirectly, by investing in a mutual fund. These types of expenses,
as they relate to Scudder Massachusetts Tax Free Fund are:
Shareholder transaction expenses --
Expenses charged directly to your account for various transactions.
Sales Commission None
Commissions to Reinvest Dividends None
Redemption Fee None
Exchange Fee None
Annual Fund operating expenses (after expense maintenance) --
Expenses paid by the Fund before it distributes its net investment
income, expressed as a percentage of the Fund's average daily net
assets. Figures below are for the fiscal year ended March 31, 1996,
during which Scudder maintained the total annualized expenses of the
Fund at 0.75% of average daily net assets from January 1, 1995 to
December 31, 1995. Actual total operating expenses for the fiscal
year ended March 31, 1996, with waiver equaled 0.75% of average
daily net assets.
Investment management fee (after waiver) 0.60%
12b-1 fees None
Other expenses 0.16%
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Total Fund operating expenses 0.76%
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Example:
Assuming a 5% annual return and redemption at the end of each
period, the total expenses relating to a $1,000 investment would be:
1 Year 3 Years 5 Years 10 Years
$8 $24 $42 $94
This example assumes reinvestment of all dividends and distributions
and that the total Fund operating expenses listed above remain the
same each year. This example should not be considered a representation
of past or future expenses or return. Actual Fund expenses and return
vary from year to year and may be higher or lower than those shown.
Please note that there is a $5 service fee if you request redemption
proceeds via wire.
6. How Has The Fund Performed Historically?
This chart shows how the Fund has performed since it commenced
operations on May 28, 1987, assuming reinvestment of all
distributions. Performance is historical and may not be indicative of
future results. Total return and principal value will fluctuate. The
Fund's 30-day net annualized SEC yield on March 31, 1997 was 4.75%.
THE PRINTED DOCUMENT CONTAINED A BAR CHART HERE
BAR CHART TITLE: Total returns for years ended December 31:
BAR CHART DATA: Below
1988 12.39
1989 9.83
1990 6.33
1991 12.24
1992 10.84
1993 14.28
1994 6.19
1995 17.90
1996 4.07
The Fund's Average Annual Total Return for the
period ended March 31, 1997
One Year 5.39%
Five Years 7.73%
Ten Years 8.41%
7. Who Manages The Fund?
The Fund's investment adviser is Scudder, Stevens & Clark, Inc., a
leading provider of U.S. and international investment management for
clients throughout the world. The Fund is each managed by a team of
Scudder investment professionals who each play an important role in
the Fund's management process.
Philip G. Condon, Lead Portfolio Manager of the Fund, joined Scudder
in 1983 and has 16 years of experience in municipal investing and
portfolio management. Mr. Condon has had responsibility for the Fund
since 1989. Kathleen A. Meany, Portfolio Manager, has worked since
1988 for Scudder Massachusetts Tax Free Fund. Ms. Meany joined Scudder
in 1988 and has 19 years of municipal investment and portfolio
management experience.
8. How Can I Invest?
To make it easy for you to open an account, you may invest by mail,
phone, fax, or in person. The minimum initial investment is $2,500
($1,000 for IRAs), except that shareholders may open a regular account
with a minimum of $1,000 if an investment program of at least
$100/month is established. A shareholder with a non-fiduciary account
who maintains an account balance of less than $2,500 without
establishing an investment program, may be assessed an annual fee of
$10.00, payable to the Fund. You may also exchange Fund shares free of
charge within the Scudder Family of Funds.
9. How Can I Redeem Shares?
You may redeem shares at the current share price on any business day
by telephone, fax, or mail.
10. When Are Distributions Made?
Dividends are declared daily and distributed monthly. Capital gains
distributions, if any, will be made in November or December. You may
elect to receive distributions in cash or have them reinvested in
additional shares of the Fund.
Distributions derived from interest on Massachusetts municipal
securities are not subject to regular federal income taxes, except for
the possible applicability of the federal alternative minimum tax. For
federal income tax purposes, a portion of the Fund's income may be
taxable to shareholders as ordinary income. Long-term capital gains
distributions, if any, are taxable as long-term capital gains for
federal income tax purposes, regardless of the length of time
shareholders have owned their shares. Short-term capital gains and any
other taxable income distributions are taxable as ordinary income.
Distributions of tax-exempt income are taken into consideration in
computing the portion, if any, of Social Security and railroad
retirement benefits subject to federal and, in some cases, state
taxes.
The Fund expects to ordinarily provide income that is 100% free from
Massachusetts personal income tax and regular federal income tax.
11. What Services Does Scudder Provide?
As a shareholder, you'll enjoy:
o professional service from representatives who can answer your
questions and execute your transactions
o automated toll-free touchtone access to account information,
share prices and yields, and to perform transactions
o Scudder's quarterly shareholder newsletter, Scudder Perspectives
o regular, informative reports about the performance of your Fund
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[Image]Scudder wants you to make informed investment decisions. This
Fund Profile contains key information about the Fund. If you would
like more information before you invest, please consult the Fund's
accompanying prospectus. For details about the Fund's holdings or
recent investment strategies, please review the Fund's most recent
annual or semiannual report. The reports are free and may be ordered
by calling 1-800-225-2470.
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