<PAGE>
SUNAMERICA MONEY MARKET FUND
SHAREHOLDER LETTER
February 10, 1997
Dear Shareholder:
The SunAmerica Money Market Fund's investment objective is to seek as high a
level of current income as is consistent with liquidity and stability of
capital by investing primarily in high quality, short-term money market
instruments.
For the year ended December 31, 1996, the Fund's Class A share's total
return was 4.61% and the Fund's SEC seven-day yield was 4.55%. Since the Fund
invests only in short-term obligations with a maturity of 13 months or less,
its performance generally tracks the short-term market levels.
The Federal Reserve's rates remained unchanged for most of 1996. This was
based on their belief that although the economy was expanding, enhancements in
technology and global competition would keep inflation close to their target
range of 2.5% to 3%. While economists revised their forecasts frequently due
to increases in economic activity, the increases in economic growth did not
produce the inflationary pressures that many feared. Although the average
American consumer had more disposable income, the additional income was
generally invested rather than spent. The American consumer has sent a message
to businesses everywhere; they want quality and low prices and they are
willing to wait for them.
As we enter 1997, we believe that short-term rates will remain stable
throughout the first quarter. It is our belief that the rapid rise in the
dollar will keep American companies from expanding their distribution overseas
and domestic activity will tend to be moderate. As competition continues to
grow, however, some companies may be pushed to their limits, thereby making
credit quality our primary focus.
The Fund's strategy remains conservative. We will attempt to maintain the
average maturity close to the Donoghue Average and will focus on the larger
issuers of debt which offer the greatest level of liquidity. This will enable
us to actively manage the portfolio to minimize potential future volatility.
/s/ P. Christopher Leary
P. Christopher Leary
Portfolio Manager
<PAGE>
SUNAMERICA MONEY MARKET FUND
PORTFOLIO OF INVESTMENTS AT DECEMBER 31, 1996
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
SECURITY DESCRIPTION (IN THOUSANDS) RATE** MATURITY (NOTE 2)
- ------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
ASSET BACKED SECURITIES--1.8%
AT&T Capital Equipment Leasing $ 7,723 5.60% 10/15/97 $ 7,723,064
------------
TOTAL ASSET BACKED SECURITIES
(amortized cost $7,723,064) 7,723,064
------------
CERTIFICATES OF DEPOSIT--8.6%
Commerzbank Yankee 6,000 5.40 1/08/97 6,000,048
Dai-Itchi Kango Bank 11,000 5.53 1/21/97 11,000,352
Sanwa Bank Ltd. 10,000 5.50 1/15/97 9,999,964
Sumitomo Bank 10,000 5.52 2/06/97 10,000,099
------------
TOTAL CERTIFICATES OF DEPOSIT
(amortized cost $37,000,463) 37,000,463
------------
COMMERCIAL PAPER--53.9%
Allegheny University Hospital 9,000 5.40 2/18/97 8,935,200
Avnet, Inc. 6,820 5.33 2/07/97 6,782,640
Banca CRT Financial Corp. 6,000 5.35 1/06/97 5,995,542
Bass Finance (C.I.) Ltd. 7,000 5.36 2/10/97 6,958,311
BHF Finance (DE), Inc. 7,000 5.40 2/04/97 6,964,300
Cofco Capital Corp. 6,000 5.35 2/14/97 5,960,767
Commed Fuel Co., Inc. 7,959 5.32 2/13/97 7,908,425
Cooperative Association of Tractor Dealers,
Inc. 13,700 5.32 1/13/97 13,675,705
Dean Witter, Discover & Co. 8,000 5.31 1/09/97 7,990,560
Dynamic Funding Corp. 7,000 5.57 2/05/97 6,962,093
Embarcadero Center Venture (Four) 8,000 5.62 1/15/97 7,982,516
Formosa Plastics Corp. 5,000 5.32 1/22/97 4,984,483
Goldman Sachs Group L.P. 8,000 5.30 3/05/97 7,925,800
Guinness PLC 7,000 5.30 1/21/97 6,979,389
Hitachi Credit America Corp. 10,441 5.34 1/28/97 10,399,184
Japan Leasing Finance Corp. 8,000 5.45 3/03/97 7,926,122
Madison Funding Corp. 14,000 5.34-5.36 1/13/97-1/27/97 13,960,442
Merrill Lynch & Co., Inc. 10,000 5.33 2/12/97 9,937,817
Mont Blanc Capital Corp. 7,000 5.45 1/13/97 6,987,283
Oak Funding Corp. 12,000 5.44 1/31/97 11,945,600
Orix America, Inc. 8,000 5.40 1/02/97 7,998,800
Premium Funding, Inc. 8,000 5.35 1/15/97 7,983,356
Ryobi Finance Corp. 5,000 5.68 1/21/97 4,984,222
Sheffield Receivables Corp. 10,500 6.85 1/02/97 10,498,002
SRD Finance, Inc. 10,000 5.50 1/23/97 9,966,389
Sunbelt-DIX, Inc. 7,976 5.35 2/04/97 7,935,699
USA Group Secondary Market Services, Inc. 6,000 5.32 2/10/97 5,964,533
Working Capital Management Co. L.P. 8,000 5.45 1/24/97 7,972,145
------------
TOTAL COMMERCIAL PAPER
(amortized cost $230,465,325) 230,465,325
------------
GOVERNMENT AGENCIES--2.7%
Agency for International Development India+ 3,000 5.67 1/07/97 3,006,319
Agency for International Development Isra-
el+ 3,216 5.56 1/07/97 3,216,127
Agency for International Development Pana-
ma+ 5,089 5.68 1/07/97 5,121,703
------------
TOTAL GOVERNMENT AGENCIES
(amortized cost $11,344,149) 11,344,149
------------
</TABLE>
<PAGE>
SUNAMERICA MONEY MARKET FUND
PORTFOLIO OF INVESTMENTS AT DECEMBER 31, 1996 -- (CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
SECURITY DESCRIPTION (IN THOUSANDS) RATE** MATURITY (NOTE 2)
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
MEDIUM TERM NOTES--23.4%
American Express Centurion+ $ 6,000 5.57% 1/13/97 $ 6,000,000
Bear Stearns Cos., Inc.+ 12,500 5.56-5.61 1/02/97-1/03/97 12,500,000
Beneficial Corp. 4,700 9.13 3/12/97 4,734,286
Boatmen's Credit Card Bank+ 8,000 5.54 1/08/97 7,999,068
Boatmen's National Bank of St. Louis+ 5,000 5.35 1/07/97 5,000,000
Campbell Soup Co. 4,567 7.75 2/24/97 4,584,089
Credit National+ 8,000 5.50 2/24/97 7,999,900
Ford Motor Credit Co. 4,000 5.20 1/01/97 4,000,000
General Motors Acceptance Corp. 7,000 5.00 1/27/97 6,996,210
Key Bank of Wyoming+ 5,000 5.55 1/14/97 4,999,587
Manufacturers Life Insurance Cos. 3,000 8.25 3/01/97 3,014,174
Nationsbank Corp. 7,300 7.50 2/15/97 7,318,990
PNC Bank, N.A.+ 11,000 5.24-5.50 1/07/97-1/13/97 10,995,666
Smith Barney Holdings, Inc. 5,000 6.00 3/15/97 5,007,167
Sony Capital Corp.+ 9,000 5.50 2/28/97 9,000,000
------------
TOTAL MEDIUM TERM NOTES
(amortized cost $100,149,137) 100,149,137
------------
TAXABLE MUNICIPAL MEDIUM TERM NOTES--8.5%
Illinois Student Assistance Corp.+ 16,000 5.85-5.91 1/01/97 16,000,000
New Hampshire State Industrial
Development Authority 13,000 5.48 1/22/97 13,000,000
Texas G.O.+ 7,415 5.88 1/01/97 7,415,000
------------
TOTAL TAXABLE MUNICIPAL MEDIUM TERM NOTES
(amortized cost $36,415,000) 36,415,000
------------
TOTAL INVESTMENT SECURITIES
(amortized cost $423,097,138) 423,097,138
------------
REPURCHASE AGREEMENT--0.7%
Joint Repurchase Agreement Account (Note 3)
(cost $3,076,000) 3,076 6.25 1/02/97 3,076,000
------------
TOTAL INVESTMENTS--
(amortized cost $426,173,138*) 99.6% 426,173,138
Other assets less liabilities 0.4 1,639,363
----- ------------
NET ASSETS 100.0% $427,812,501
===== ============
</TABLE>
- --------
* At December 31, 1996 the cost of securities for Federal income tax purposes
was the same as for book purposes
** Rates shown are rates in effect as of December 31, 1996
+ Variable rate security; maturity date reflects the next reset date
G.O. --General Obligation
PORTFOLIO BREAKDOWN AS A PERCENTAGE OF NET ASSETS (EXCLUDING REPURCHASE
AGREEMENT) BY INDUSTRY@
<TABLE>
<S> <C> <C> <C> <C> <C>
Consumer Credit Services 5.1% Financial Services 22.2% Real Estate 1.9%
Industrials 3.8 Finance 19.1 Utilities 1.9
Government Agencies 2.7 Banking 18.5 Food & Beverages 1.6
Receivables Company 2.5 Municipalities 8.5 Insurance 0.7
Pharmaceuticals 2.1 Securities Holding Company 8.3 ----
98.9%
====
</TABLE>
@ As grouped by Moody's Investors Service Global Short Term Market Record
See Notes to Financial Statements
<PAGE>
SUNAMERICA MONEY MARKET FUND
STATEMENT OF ASSETS AND LIABILITIES AT DECEMBER 31, 1996
<TABLE>
<S> <C>
ASSETS:
Investment securities, at value (amortized cost $426,173,138)....... $426,173,138
Cash................................................................ 434,237
Interest receivable................................................. 2,043,498
Receivable for fund shares sold..................................... 921,283
Prepaid expenses.................................................... 90,425
------------
Total assets....................................................... 429,662,581
------------
LIABILITIES:
Payable for fund shares repurchased................................. 1,312,832
Accrued expenses.................................................... 281,477
Investment advisory and management fees payable..................... 181,780
Distribution and service maintenance fees payable................... 73,991
------------
Total liabilities.................................................. 1,850,080
------------
Net assets...................................................... $427,812,501
============
NET ASSETS WERE COMPOSED OF:
Common Stock, $.001 par value (10 billion shares authorized)........ $ 427,802
Additional paid-in capital.......................................... 427,279,382
------------
427,707,184
Accumulated undistributed net investment income..................... 105,317
------------
Net assets...................................................... $427,812,501
============
CLASS A:
Net asset value ($398,698,191/398,688,570 shares outstanding)...... $1.00
=====
CLASS B:
Net asset value ($29,114,310/29,113,376 shares outstanding)........ $1.00
=====
</TABLE>
STATEMENT OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 1996
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Interest.............................................. $21,126,368
-----------
EXPENSES:
Investment advisory and management fees............... $1,923,536
Service maintenance fees--Class A..................... 513,979
Distribution and service maintenance fees--Class B.... 378,491
Transfer agent and shareholder servicing fees and ex-
penses--Class A...................................... 909,471
Transfer agent and shareholder servicing fees and ex-
penses--Class B...................................... 110,682
Custodian fees and expenses........................... 161,170
Registration fees--Class A............................ 43,403
Registration fees--Class B............................ 12,028
Directors' fees and expenses.......................... 47,820
Audit and tax consulting fees......................... 31,620
Printing expense...................................... 32,375
Insurance expense..................................... 6,763
Legal fees and expenses............................... 6,610
Miscellaneous expenses................................ 6,101
----------
4,184,049
Less: expense offset.................................. (139,424)
-----------
Net expenses.......................................... 4,044,625
-----------
Net investment income................................. 17,081,743
-----------
INCREASE IN NET ASSETS RESULTING FROM OPERATIONS...... $17,081,743
===========
</TABLE>
See Notes to Financial Statements
<PAGE>
SUNAMERICA MONEY MARKET FUND
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FOR THE YEAR FOR THE YEAR
ENDED ENDED
DECEMBER 31, 1996 DECEMBER 31, 1995
-----------------------------------
<S> <C> <C>
INCREASE IN NET ASSETS:
OPERATIONS:
Net investment income..................... $ 17,081,743 $ 15,308,139
------------ ------------
Net increase in net assets resulting from
operations............................... 17,081,743 15,308,139
DIVIDENDS AND DISTRIBUTIONS TO
SHAREHOLDERS:
From net investment income (Class A)...... (15,491,408) (12,540,465)
From net investment income (Class B)...... (1,583,636) (2,793,748)
------------ ------------
Total dividends and distributions to
shareholders............................. (17,075,044) (15,334,213)
INCREASE IN NET ASSETS FROM FUND SHARE
TRANSACTIONS (NOTE 5)..................... 59,699,130 55,776,169
------------ ------------
Total increase in net assets.............. 59,705,829 55,750,095
NET ASSETS:
Beginning of year......................... 368,106,672 312,356,577
------------ ------------
End of period (including undistributed net
investment income of $105,317 and $98,618
at December 31, 1996 and December 31,
1995, respectively)...................... $427,812,501 $368,106,672
============ ============
</TABLE>
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
NET NET NET RATIO OF
ASSET DIVIDENDS ASSET ASSETS RATIO OF NET INVESTMENT
VALUE NET TOTAL FROM FROM NET VALUE END OF EXPENSES INCOME TO
PERIOD BEGINNING INVESTMENT INVESTMENT INVESTMENT END OF TOTAL PERIOD TO AVERAGE AVERAGE
ENDED OF PERIOD INCOME OPERATIONS INCOME PERIOD RETURN(1) (000'S) NET ASSETS NET ASSETS
- ------------------------------------------------------------------------------------------------------------
CLASS A
-------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
12/31/92 $1.000 $0.027 $0.027 $(0.027) $1.000 2.74% $215,521 1.27% 2.76%
12/31/93 1.000 0.023 0.023 (0.023) 1.000 2.32 189,160 1.16 2.30
12/31/94 1.000 0.034 0.034 (0.034) 1.000 3.47 213,958 1.00 3.43
12/31/95 1.000 0.051 0.051 (0.051) 1.000 5.18 316,308 1.01(2) 5.04
12/31/96 1.000 0.045 0.045 (0.045) 1.000 4.61 398,698 1.00(2) 4.52
<CAPTION>
CLASS B
-------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
09/24/93-
12/31/93 $1.000 $0.004 $0.004 $(0.004) $1.000 0.44%(3) $41,915 1.69%(4) 1.69%(4)
12/31/94 1.000 0.027 0.027 (0.027) 1.000 2.76 98,398 1.69 2.91
12/31/95 1.000 0.044 0.044 (0.044) 1.000 4.49 51,799 1.78(2) 4.37
12/31/96 1.000 0.038 0.038 (0.038) 1.000 3.83 29,114 1.77(2) 3.76
</TABLE>
- -------
(1) Total return does not reflect sales load
(2) The expense ratio reflects the effect of a gross up of custody and
transfer agent expense credit for the year ended December 31, 1995 and a
gross up of transfer agent expense credits for the year ended December 31,
1996 as follows:
<TABLE>
<CAPTION>
12/31/95 12/31/96
-------- --------
<S> <C> <C>
Class A......... 0.05% 0.03%
Class B......... 0.13% 0.04%
</TABLE>
(3) Total return is not annualized
(4) Annualized
See Notes to Financial Statements
<PAGE>
SUNAMERICA MONEY MARKET FUND
NOTES TO FINANCIAL STATEMENTS--DECEMBER 31, 1996
NOTE 1. ORGANIZATION
SunAmerica Money Market Fund (the "Fund") is an open-end diversified
management investment company organized as a Maryland Corporation.
The Fund currently offers Class A shares and Class B shares. The offering
price is the next determined net asset value per share. For Class B shares
only, a declining contingent deferred sales charge ("CDSC") is imposed on
certain redemptions made within six years. Class B shares of the Fund
convert automatically to Class A shares on the first business day of the
month seven years after the issuance of such Class B shares and at such time
are no longer subject to a distribution fee. Each class of shares bears the
same voting, dividend, liquidation and other rights and conditions and each
makes account maintenance and service fee payments under a distribution plan
pursuant to Rule 12b-1 under the Investment Company Act of 1940 (the "1940
Act") except that Class B shares are subject to distribution fees.
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of the significant accounting policies followed
by the Fund in the preparation of its financial statements:
SECURITY VALUATIONS: Portfolio securities are valued at amortized cost,
which approximates market value. The amortized cost method involves valuing
a security at its cost on the date of purchase and thereafter assuming a
constant amortization to maturity of any discount or premium.
REPURCHASE AGREEMENTS: The Fund, along with other affiliated registered
investment companies, may transfer uninvested cash balances into a single
joint account, the daily aggregate balance of which is invested in one or
more repurchase agreements collateralized by U.S. Treasury or federal agency
obligations. The Fund's custodian takes possession of the collateral pledged
for investments in repurchase agreements. The underlying collateral is
valued daily on a mark to market basis to ensure that the value, including
accrued interest, is at least equal to the repurchase price. In the event of
default of the obligation to repurchase, the Fund has the right to liquidate
the collateral and apply the proceeds in satisfaction of the obligation. If
the seller defaults and the value of the collateral declines or if
bankruptcy proceedings are commenced with respect to the seller of the
security, realization of the collateral by the Fund may be delayed or
limited.
SECURITIES TRANSACTIONS, INVESTMENT INCOME AND DISTRIBUTIONS TO
SHAREHOLDERS: Securities transactions are recorded as of the trade date.
Interest income, including the accretion of discount and amortization of
premium, is accrued daily. Realized gains and losses on sales of investments
are calculated on the identified cost basis.
Net investment income other than class specific expenses, and realized and
unrealized gains and losses are allocated daily to each class of shares
based upon the relative net asset value of outstanding shares of each
class of shares at the beginning of the day (after adjusting for the current
capital shares activity of the respective class).
Dividends from net investment income are declared daily and paid monthly.
USE OF ESTIMATES IN FINANCIAL STATEMENT PREPARATION: The preparation of
financial statements in accordance with generally accepted accounting
principles requires management to make estimates and assumptions that affect
the reported amounts and disclosures in the financial statements. Actual
results could differ from these estimates.
<PAGE>
SUNAMERICA MONEY MARKET FUND
NOTES TO FINANCIAL STATEMENTS--DECEMBER 31, 1996--(CONTINUED)
FEDERAL INCOME TAXES: It is the Fund's policy to meet the requirements of
the Internal Revenue Code of 1986, as amended, applicable to regulated
investment companies and to distribute all of its taxable net income to its
shareholders. Therefore, no federal income or excise tax provisions are
required.
For the year ended December 31, 1996, the Fund incurred capital loss of
$15,566 which was offset against interest income on the Statement of
Operations. At December 31, 1996, the Fund had capital loss carryforwards in
the following amounts:
EXPIRATION
---------------------------------------------------
2002 2003 2004
------ ------- -------
$5,892 $11,725 $15,660
To the extent that these capital loss carryforwards are utilized to offset
future net realized gains on securities transactions, the gain, so offset
will not be distributed to the shareholders, to the extent provided by the
regulations.
Capital losses incurred after October 31 within the Fund's fiscal year are
deemed to arise on the first business day of the following fiscal year for
tax purposes. The fund has incurred and will elect to defer $820 of such
capital losses.
NOTE 3. JOINT REPURCHASE AGREEMENT ACCOUNT
As of December 31, 1996, the Fund had a 9.3% undivided interest, which
represented $3,076,000 in principal amount, in a repurchase agreement in a
joint account with other SunAmerica managed funds. As of such date, the
repurchase agreement in the joint account and the collateral therefore was
as follows:
Yamaichi International (America), Inc., Repurchase Agreement, 6.25% dated
12/31/96, in the principal amount of $33,000,000 repurchase price
$33,011,458 due 1/2/97 collateralized by $8,040,000 U.S. Treasury Notes
5.75% due 9/30/97 and $24,810,000 U.S. Treasury Notes 6.375% due 9/30/01,
approximate aggregate value $33,660,748.
NOTE 4. INVESTMENT ADVISORY AND MANAGEMENT AGREEMENT, DISTRIBUTION AGREEMENT
AND SERVICE AGREEMENT
The Fund has an Investment Advisory and Management Agreement (the
"Agreement") with SunAmerica Asset Management Corp. ("SAAMCo"), an indirect
wholly owned subsidiary of SunAmerica Inc. Under the Agreement, SAAMCo
provides continuous supervision of the Fund's portfolio and administers its
corporate affairs, subject to general review by the Directors. In connection
therewith, SAAMCo furnishes the Fund with office facilities, maintains
certain of the Fund's books and records, and pays the salaries and expenses
of all personnel, including officers of the Fund who are employees of SAAMCo
and its affiliates. The investment advisory and management fee to SAAMCo is
computed daily and payable monthly, at an annual rate of .50% on the first
$600 million of the Fund's daily net assets, .45% on the next $900 million
of net assets and .40% on net assets over $1.5 billion.
The Fund has a Distribution Agreement with SunAmerica Capital Services, Inc.
("SACS" or the "Distributor"), an indirect wholly owned subsidiary of
SunAmerica Inc. The Fund has adopted a Distribution Plan (the "Plan") in
accordance with the provisions of Rule 12b-1 under the 1940 Act. Rule 12b-1
permits an investment company directly or indirectly to pay expenses
associated with the distribution of its shares ("distribution expenses") in
accordance with a plan adopted by the investment company's board of
directors and approved by its shareholders. Pursuant to such rule, the
Directors and the shareholders of each class of shares of the Fund have
adopted Distribution Plans hereinafter referred to as the "Class A Plan" and
the "Class B Plan."
<PAGE>
SUNAMERICA MONEY MARKET FUND
NOTES TO FINANCIAL STATEMENTS--DECEMBER 31, 1996--(CONTINUED)
In adopting the Class A Plan and the Class B Plan, the Directors determined
that there was a reasonable likelihood that each such Plan would benefit the
Fund and the shareholders of the respective class. The sales charge and
distribution fees of the Class B shares will not be used to subsidize the
sale of Class A shares.
Under the Class B Plan the Distributor receives payments from the Fund at
the annual rate of up to 0.75% of the average daily net assets of the Fund's
Class B shares, to compensate the Distributor and certain securities firms
for providing sales and promotional activities for distributing that class
of shares. The distribution costs for which the Distributor may be
reimbursed out of such distribution fees include fees paid to broker-dealers
that have sold Fund shares, commissions, and other expenses such as those
incurred for sales literature, prospectus printing and distribution and
compensation to wholesalers. It is possible that in any given year the
amount paid to the Distributor under the Class B Plan may exceed the
Distributor's distribution costs as described above. The Class A Plan does
not provide for a distribution fee. The Distribution Plans provide that each
class of shares of the Fund may also pay the Distributor an account
maintenance and service fee of up to an annual rate of 0.15% of the
aggregate average daily net assets of such class of shares for payments to
broker-dealers for providing continuing account maintenance. In this regard,
some payments are used to compensate broker-dealers with account maintenance
and service fees in an amount up to 0.15% per year of the assets maintained
in the Fund by their customers. For the year ended December 31, 1996, SACS
earned fees of $892,470 from the Fund.
SACS also receives the proceeds of contingent deferred sales charges paid by
investors in connection with certain redemptions of the Fund's Class B
shares. For the year ended December 31, 1996, SACS informed the Fund that it
received approximately $339,999 in contingent deferred sales charges.
The Fund has entered into a Service Agreement with SunAmerica Fund Services,
Inc. ("SAFS"), an indirect wholly owned subsidiary of SunAmerica Inc. Under
the Service Agreement, SAFS performs certain shareholder account functions
by assisting the Fund's transfer agent in connection with the services that
it offers to the shareholders of the Fund. The Service Agreement permits the
Fund to reimburse SAFS for costs incurred in providing such services which
is approved annually by the Directors. For the year ended December 31, 1996
the Fund (Class A and Class B) incurred expenses of $846,356 to reimburse
SAFS pursuant to the terms of the Service Agreement. Of this amount, $79,983
was payable to SAFS at December 31, 1996.
NOTE 5. CAPITAL SHARE TRANSACTIONS
Transactions in shares of each class, all at $1.00 per share, for the year
ended December 31, 1996 and for the prior year were as follows:
<TABLE>
<CAPTION>
MONEY MARKET FUND
----------------------------------------------------------
CLASS A CLASS B
------------------------------ --------------------------
FOR THE FOR THE FOR THE FOR THE
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1996 1995 1996 1995
-------------- -------------- ------------ ------------
<S> <C> <C> <C> <C>
Shares sold............. 1,460,788,582 1,100,031,147 122,015,372 445,571,488
Reinvested dividends.... 15,326,870 12,194,638 1,346,953 2,179,516
Shares redeemed......... (1,393,731,702) (1,009,865,935) (146,046,945) (494,334,685)
-------------- -------------- ------------ ------------
Net increase (decrease). 82,383,750 102,359,850 (22,684,620) (46,583,681)
============== ============== ============ ============
</TABLE>
<PAGE>
SUNAMERICA MONEY MARKET FUND
NOTES TO FINANCIAL STATEMENTS--DECEMBER 31, 1996--(CONTINUED)
NOTE 6. DIRECTORS' RETIREMENT PLAN
The Directors (and Trustees) of the SunAmerica Family of Mutual Funds have
adopted the SunAmerica Disinterested Trustees' and Directors' Retirement
Plan (the "Retirement Plan") effective January 1, 1993 for the unaffiliated
Directors. The Retirement Plan provides generally that if an unaffiliated
Director who has at least 10 years of consecutive service as a Disinterested
Director of any of the SunAmerica mutual funds (an "Eligible Director")
retires after reaching age 60 but before age 70 or dies while a Director,
such person will be eligible to receive a retirement or death benefit from
each SunAmerica mutual fund with respect to which he or she is an Eligible
Director. As of each birthday, prior to the 70th birthday, but in no event
for a period greater than 10 years, each Eligible Director will be credited
with an amount equal to 50% of his or her regular fees (excluding committee
fees) for services as a Disinterested Director of each SunAmerica mutual
fund for the calendar year in which such birthday occurs. In addition, an
amount equal to 8.5% of any amounts credited under the preceding clause
during prior years, is added to each Eligible Director's account until such
Eligible Director reaches his or her 70th birthday. An Eligible Director may
receive benefits payable under the Retirement Plan, at his or her election,
either in one lump sum or in up to fifteen annual installments. As of
December 31, 1996, the Fund had accrued $30,361 for the Retirement Plan,
which is included in accrued expenses on the Statement of Assets and
Liabilities and for the year ended December 31, 1996, and expensed $14,130
for the Retirement Plan, which is included in Directors' fees and expenses
on the Statement of Operations.
<PAGE>
SUNAMERICA MONEY MARKET FUND
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors and Shareholders of SunAmerica Money Market Fund
In our opinion, the accompanying statement of assets and liabilities,
including the portfolio of investments, and the related statements of
operations and of changes in net assets and the financial highlights present
fairly, in all material respects, the financial position of SunAmerica Money
Market Fund (the "Fund") at December 31, 1996, the results of its operations
for the year then ended, the changes in its net assets for each of the two
years in the period then ended and the financial highlights for each of the
five years in the period then ended, in conformity with generally accepted
accounting principles. These financial statements and financial highlights
(hereafter referred to as "financial statements") are the responsibility of
the Fund's management; our responsibility is to express an opinion on these
financial statements based on our audits. We conducted our audits of these
financial statements in accordance with generally accepted auditing standards
which require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements, assessing
the accounting principles used and significant estimates made by management,
and evaluating the overall financial statement presentation. We believe that
our audits, which included confirmation of securities at December 31, 1996 by
correspondence with the custodian, provide a reasonable basis for the opinion
expressed above.
Price Waterhouse LLP
1177 Avenue of the Americas
New York, New York
February 13, 1997
<PAGE>
SUNAMERICA MONEY MARKET FUND
TRUSTEES INVESTMENT MANAGER AND ADMINISTRATOR
S. James Coppersmith SunAmerica Asset Management Corp.
Samuel M. Eisenstat The SunAmerica Center
Stephen J. Gutman 733 Third Avenue
Peter A. Harbeck New York, NY 10017-3204
Peter McMillan III
Sebastiano Sterpa DISTRIBUTOR
SunAmerica Capital Services, Inc.
OFFICERS The SunAmerica Center
Peter A. Harbeck, President 733 Third Avenue
Nancy Kelly, Vice President New York, NY 10017-3204
P. Christopher Leary, Vice President
Robert M. Zakem, Secretary SHAREHOLDER SERVICING AGENT
Peter C. Sutton, Treasurer SunAmerica Fund Services, Inc.
John T. Genoy, Assistant Treasurer The SunAmerica Center
Donna M. Handel, Assistant Treasurer 733 Third Avenue
Hilary R. Kastleman, Assistant Secretary New York, NY 10017-3204
Abbe P. Stein, Assistant Secretary
CUSTODIAN AND TRANSFER AGENT
State Street Bank & Trust Company
P.O. Box 419572
Kansas City, MO 64141-6572
- -------------------------------------------------------------------------------
FASTFACTS . . . AVAILABLE FOR YOUR CONVENIENCE
The easy and convenient way to obtain the most current information on your
mutual funds. By calling our toll free number, 1-800-654-4760, you can receive
mutual fund information 24 hours a day. If you require any additional
information, please call us at 1-800-858-8850 Monday-Friday 9:00 a.m.-6:00
p.m. (Eastern time).
HERE'S HOW IT WORKS
All you need is:
* A Touch-Tone Telephone
* Your account number
* Your Personal Identification number "PIN"
(the last four digits of your Social Security number, a tax identification
number or a number chosen by you)
* Your Fund Code
CLASS CLASS
------- -------
EQUITY FUNDS A B INCOME FUNDS A B
--- --- --- ---
Balanced Assets 51 551 U.S. Government
Global Balanced 23 523 Securities 70 570
Blue Chip Growth 522 22 Federal Securities 534 34
Mid-Cap Growth 71 571 Diversified Income 580 80
Small Company Growth 36 536 High Income 28 228
Growth and Income 24 524 Tax Exempt Insured 33 533
Money Market 35 535
FUNCTIONS
1 List of Available Functions 6 Last Dividend Transaction
2 Account Balance 7 Duplicate Statement
3 Fund Price 8 Year-End Tax
4 Process an Exchange Information/Duplicate Tax
5 Lost Transaction Forms
9 Check Reorders
<PAGE>
December 31, 1996
SunAmerica
Money Market
Fund
Annual
Report
[LOGO] SunAmerica
Asset Management
800.858.8850
SunAmerica Money Market Fund
The SunAmerica Center
733 Third Avenue
New York, NY 10017-3204
1-800-858-8850
This report is submitted soley for the general information of shareholders of
the Fund. Distribution of this report to persons other than shareholders of the
Fund is authorized only in connection with a currently effective prospectus,
setting forth details of the Fund, which must precede or accompany this report.
Sponsored by:
[LOGO] SunAmerica
Asset Management
800.858.8850
MMANN
BULK RATE
U.S. POSTAGE
PAID
Kansas City, MO
PERMIT NO. 3657
