<PAGE>
DEAN WITTER U.S. GOVERNMENT SECURITIES TRUST
Two World Trade Center
New York, New York 10048
DEAR SHAREHOLDER:
- --------------------------------------------------------------------------------
During the twelve months ended December 31, 1994, continued economic growth
fueled improving consumer sentiment and spending, with retail, home and auto
sales rising rapidly in conjunction with higher levels of employment. This
continuing scenario of strong economic growth induced the Federal Reserve Board
to maintain its anti-inflation initiative begun in early February, 1994. At that
time the central bank initiated a series of interest rate increases that brought
the federal-funds rate -- the interest rate banks charge each other for
overnight loans -- from 3.00 percent to 5.50 percent by December 31, 1994. In
addition, the Federal Reserve Board also increased the discount rate -- the rate
the Federal Reserve charges member banks for loans -- from 3.00 percent to 4.75
percent. These increases signaled the end of the central bank's five-year
accommodative monetary policy. As a result of the Federal Reserve's actions,
interest rates on short- and intermediate-term U.S. Treasury securities were
more than 2.50 percentage points higher on December 31, 1994 than one year ago.
Consequently, the
U.S. Treasury market recorded its worst
12-month performance in decades. On
December 31, 1994, the 5-year U.S.
Treasury note was yielding 7.83 percent
compared to 5.21 percent twelve-months
ago.
PERFORMANCE AND PORTFOLIO STRUCTURE
The Fund's performance for the fiscal
year was reflective of the sharply higher
interest rate environment and difficult
investment conditions in general, despite
its relatively conservative portfolio
maturity structure. For the twelve-month
period ended December 31, 1994, the Fund
declined 3.51 percent. This includes
income distributions of $0.58 per share
and a change in net asset value from $9.31
on December 31, 1993 to $8.41 per share on
December 31, 1994. The Fund's distribution
rate as of December 31, 1994, was 6.91
percent and the 30-day SEC yield was 6.89
percent.
The accompanying chart illustrates the
growth of a $10,000 investment in the Fund
for the ten-year period beginning December
31, 1984 through the fiscal year ended
December 31, 1994, versus a similar
investment in the Lehman Brothers Mutual
Fund General U.S. Government Index. (The
Fund's inception date is June 29, 1984.)
The portfolio continues to be well
diversified. As of December 31, 1994, the
Fund's portfolio was comprised of
Government National Mortgage Association
mortgage-backed securities (GNMAs) (69
percent), Treasury securities (25 percent)
and U.S. government agency Resolution
<PAGE>
Funding Corporation securities (REFCORP) (5 percent). Throughout 1994 the Fund's
average maturity reflected a relatively neutral and conservative position.
While higher interest rates have been responsible for reducing the Fund's
net asset value, this scenario is beginning to generate attractive yields on
longer-term bonds. For 1995, we will continue to reduce the portfolio's high
coupon short-term U.S. Treasury position. Consequently, the Fund's average
maturity may gradually be extended as attractive investment opportunities become
available. We believe that GNMAs continue to offer significant long-term value
and, in the current investment environment, offer not only an incremental yield
incentive over U.S. Treasury securities of similar maturity but also the
potential for capital gains.
LOOKING AHEAD
By mid-1995, we expect the economy to slow vis-a-vis the rapid pace
experienced in 1994. This should occur as higher interest rates take their toll.
Although the markets have reacted negatively to concerns regarding anticipated
inflationary pressure, we believe inflation will stabilize in the three to three
and one-half percent range in 1995. If this scenario unfolds in the coming year,
the Fund will continue to provide not only a competitive level of income, but
the potential for capital appreciation.
We appreciate your support of Dean Witter U.S. Government Securities Trust
and look forward to continuing to serve your investment objectives in the months
and years to come.
Very truly yours,
Charles A. Fiumefreddo
CHAIRMAN OF THE BOARD
<PAGE>
DEAN WITTER U.S. GOVERNMENT SECURITIES TRUST
PORTFOLIO OF INVESTMENTS DECEMBER 31, 1994
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT COUPON MATURITY
(IN THOUSANDS) RATE DATES VALUE
- ---------------- ------ ------------------- --------------
<C> <S> <C> <C> <C>
U.S. GOVERNMENT OBLIGATIONS (24.6%)
U.S. TREASURY STRIPS (5.6%)
$ 123,000 .................... 0.00% 02/15/04 $ 60,534,647
380,000 .................... 0.00 05/15/04 183,450,016
385,000 .................... 0.00 08/15/04 181,755,189
75,000 .................... 0.00 11/15/04 34,728,937
--------------
460,468,789
--------------
U.S. TREASURY NOTES (18.8%)
26,500 .................... 6.875 03/31/97 26,011,406
191,000 .................... 6.875 04/30/97 187,448,594
55,000 .................... 7.00 04/15/99 53,307,031
15,000 .................... 7.75 02/15/95 15,035,156
9,000 .................... 8.00 10/15/96 9,043,594
85,000 .................... 8.375 04/15/95 85,517,969
258,500 .................... 8.50 11/15/95 261,206,172
250,000 .................... 8.625 01/15/95 250,117,188
184,000 .................... 8.625 10/15/95 185,897,500
229,000 .................... 8.875 07/15/95 231,361,563
193,500 .................... 8.875 02/15/96 196,342,031
41,500 .................... 9.25 01/15/96 42,239,219
--------------
1,543,527,423
--------------
U.S. TREASURY BILLS (A) (0.2%)
1,200 .................... 4.00 01/19/95 1,197,600
14,000 .................... 4.70 01/19/95 13,967,100
--------------
15,164,700
--------------
TOTAL U.S. GOVERNMENT OBLIGATIONS
(IDENTIFIED COST $2,088,052,518) ................... 2,019,160,912
--------------
U.S. GOVERNMENT AGENCIES (74.2%)
ZERO COUPON STRIPS (5.4%)
RESOLUTION FUNDING CORP.
19,000 .................... 0.00 01/15/02 11,001,538
21,150 .................... 0.00 04/15/02 12,038,652
61,500 .................... 0.00 07/15/02 34,131,393
57,049 .................... 0.00 10/15/02 31,031,558
71,000 .................... 0.00 01/15/03 37,807,649
109,000 .................... 0.00 04/15/03 56,927,070
71,000 .................... 0.00 07/15/03 36,325,403
108,000 .................... 0.00 10/15/03 54,192,164
169,882 .................... 0.00 01/15/04 83,500,384
104,419 .................... 0.00 04/15/04 50,290,153
85,000 .................... 0.00 07/15/04 40,023,211
--------------
447,269,175
--------------
<PAGE>
</TABLE>
DEAN WITTER U.S. GOVERNMENT SECURITIES TRUST
PORTFOLIO OF INVESTMENTS DECEMBER 31, 1994 (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT COUPON MATURITY
(IN THOUSANDS) RATE DATES VALUE
- ---------------- ------ ------------------- --------------
<C> <S> <C> <C> <C>
MORTGAGE PASS-THROUGH CERTIFICATES (68.8%)
GOVERNMENT NATIONAL MORTGAGE
ASSOCIATION I (68.0%)
.................... 10/15/22 to
$ 320,932 6.50% 02/15/24 $ 278,007,539
.................... 04/15/17 to
2,112,491 7.00 06/15/24 1,895,960,782
.................... 09/15/16 to
1,508,626 7.50 05/15/23 1,399,721,753
.................... 10/15/16 to
448,439 8.00 09/15/24 428,679,489
.................... 07/15/06 to
511,299 8.50 11/15/24 502,350,791
.................... 10/15/08 to
402,468 9.00 08/15/21 405,989,403
.................... 10/15/09 to
301,601 9.50 12/15/20 311,120,303
.................... 11/15/09 to
339,026 10.00 11/15/20 356,401,345
.................... 04/15/10 to
1,079 12.50 06/15/15 1,186,043
--------------
5,579,417,448
--------------
GOVERNMENT NATIONAL MORTGAGE
ASSOCIATION II (0.6%)
.................... 01/20/24 to
54,363 6.50 02/20/24 46,871,245
--------------
GOVERNMENT NATIONAL MORTGAGE
ASSOCIATION GRADUATED PAYMENT
MORTGAGE I (0.2%)
.................... 06/15/13 to
16,657 12.25 09/15/15 18,223,273
--------------
TOTAL U.S. GOVERNMENT AGENCIES
(IDENTIFIED COST $6,454,998,952) ................... 6,091,781,141
--------------
TOTAL INVESTMENTS (IDENTIFIED COST
$8,543,051,470)(B) ........................ 98.8% 8,110,942,053
CASH AND OTHER ASSETS IN EXCESS OF LIABILITIES ... 1.2 99,762,242
NET ASSETS ................................ 100.0% $8,210,704,295
<FN>
- -------------
(A) U.S. TREASURY BILLS WERE PURCHASED ON A DISCOUNT BASIS. THE RATE SHOWN
REFLECTS A BOND EQUIVALENT INTEREST RATE.
(B) THE AGGREGATE COST OF INVESTMENTS FOR FEDERAL INCOME TAX PURPOSES IS
$8,543,051,470; THE AGGREGATE GROSS UNREALIZED APPRECIATION IS $67,327,379
AND THE AGGREGATE GROSS UNREALIZED DEPRECIATION IS $499,436,796, RESULTING
IN NET UNREALIZED DEPRECIATION OF $432,109,417.
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER U.S. GOVERNMENT SECURITIES TRUST
FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1994
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investments in securities, at value
(identified cost $8,543,051,470)..... $ 8,110,942,053
Cash................................... 2,592,886
Receivable for:
Investments sold..................... 152,424,219
Interest............................. 78,495,905
Shares of beneficial interest sold... 3,613,376
Prepaid expenses and other assets...... 67,046
----------------
TOTAL ASSETS................... 8,348,135,485
----------------
LIABILITIES:
Payable for:
Investments purchased................ 85,548,406
Dividends to shareholders............ 24,410,290
Shares of beneficial interest
repurchased........................ 18,224,505
Plan of distribution fee............. 5,293,958
Investment management fee............ 2,884,555
Accrued expenses and other payables.... 1,069,476
----------------
TOTAL LIABILITIES.............. 137,431,190
----------------
NET ASSETS:
Paid-in-capital........................ 10,341,446,761
Net unrealized depreciation............ (432,109,417)
Accumulated undistributed net
investment income.................... 1,519,505
Accumulated net realized loss.......... (1,700,152,554)
----------------
NET ASSETS..................... $ 8,210,704,295
----------------
----------------
NET ASSET VALUE PER SHARE, 975,890,696
shares outstanding (unlimited shares
authorized of $.01 par value)........
$8.41
----------------
----------------
</TABLE>
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1994
<TABLE>
<S> <C>
NET INVESTMENT INCOME:
INTEREST INCOME...................... $ 797,501,980
---------------
EXPENSES
Plan of distribution fee........... 76,161,225
Investment management fee.......... 40,553,081
Transfer agent fees and expenses... 6,329,874
Custodian fees..................... 926,814
Registration fees.................. 243,063
Shareholder reports and notices.... 201,756
Professional fees.................. 96,821
Trustees' fees and expenses........ 31,816
Other.............................. 106,620
---------------
TOTAL EXPENSES................. 124,651,070
---------------
NET INVESTMENT INCOME........ 672,850,910
---------------
NET REALIZED AND UNREALIZED LOSS:
Net realized loss.................. (93,634,833)
Net change in unrealized
appreciation..................... (1,005,227,953)
---------------
NET LOSS....................... (1,098,862,786)
---------------
NET DECREASE IN NET ASSETS
RESULTING FROM OPERATIONS.. $ (426,011,876)
---------------
---------------
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FOR THE FOR THE
YEAR ENDED YEAR ENDED
DECEMBER 31,1994 DECEMBER 31, 1993
------------------ ------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
Operations:
Net investment income................................................ $ 672,850,910 $ 854,073,581
Net realized loss.................................................... (93,634,833) (261,427,859)
Net change in unrealized appreciation................................ (1,005,227,953) 284,089,311
------------------ ------------------
Net increase (decrease).......................................... (426,011,876) 876,735,033
------------------ ------------------
Dividends to shareholders from net investment income................... (671,363,981) (854,048,343)
Net decrease from transactions in shares of beneficial interest........ (2,926,948,321) (271,700,686)
------------------ ------------------
Total decrease................................................... (4,024,324,178) (249,013,996)
NET ASSETS:
Beginning of period.................................................... 12,235,028,473 12,484,042,469
------------------ ------------------
END OF PERIOD (including undistributed net investment income of
$1,519,505 and $32,576, respectively)................................. $ 8,210,704,295 $ 12,235,028,473
------------------ ------------------
------------------ ------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER U.S. GOVERNMENT SECURITIES TRUST
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
1. ORGANIZATION AND ACCOUNTING POLICIES--Dean Witter U.S. Government Securities
Trust (the "Fund") is registered under the Investment Company Act of 1940, as
amended (the "Act"), as a diversified, open-end management investment company.
The Fund was organized as a Massachusetts trust on September 29, 1983 and
commenced operations on June 29, 1984.
The following is a summary of significant accounting policies:
A. VALUATION OF INVESTMENTS--(1) all portfolio securities for which
over-the-counter market quotations are readily available are valued at the
latest available bid price prior to the time of valuation; (2) when market
quotations are not readily available, portfolio securities are valued at
their fair value as determined in good faith under procedures established by
and under the general supervision of the Trustees (valuation of debt
securities for which market quotations are not readily available may be
based upon current market prices of securities which are comparable in
coupon, rating and maturity or an appropriate matrix utilizing similar
factors) and; (3) short-term debt securities having a maturity date of more
than sixty days at time of purchase are valued on a mark-to-market basis
until sixty days prior to maturity and thereafter at amortized cost based on
their value on the 61st day. Short-term securities having a maturity date of
sixty days or less at the time of purchase are valued at amortized cost.
B. ACCOUNTING FOR INVESTMENTS--Security transactions are accounted for on
the trade date (date the order to buy or sell is executed). Realized gains
and losses on security transactions are determined on the identified cost
method. Discounts on securities purchased are amortized over the life of the
respective securities. The Fund does not amortize premiums on securities.
Interest income is accrued daily.
C. FEDERAL INCOME TAX STATUS--It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute all of its taxable income to its shareholders.
Accordingly, no federal income tax provision is required.
D. DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS--The Fund records dividends
and distributions to its shareholders on the record date. The amount of
dividends and distributions from net investment income and net realized
capital gains are determined in accordance with federal income tax
regulations which may differ from generally accepted accounting principles.
These "book/tax" differences are either considered temporary or permanent in
nature. To the extent these differences are permanent in nature, such
amounts are reclassified within the capital accounts based on their federal
tax-basis treatment; temporary differences do not require reclassification.
Dividends and distributions which exceed net investment income and net
realized capital gains for financial reporting purposes but not for tax
purposes are reported as dividends in excess of net investment income or
distributions in excess of net realized capital gains. To the extent they
exceed net investment income and net realized capital gains for tax
purposes, they are reported as distributions of paid-in-capital.
2. INVESTMENT MANAGEMENT AGREEMENT--Pursuant to an Investment Management
Agreement with Dean Witter InterCapital Inc. (the "Investment Manager"), the
Fund pays its Investment Manager a management fee, accrued daily and payable
monthly, by applying the following annual rates to the Fund's net assets
determined at the close of each business day: 0.50% to the portion of daily net
assets not exceeding $1 billion; 0.475% to the portion of daily net assets
exceeding $1 billion but not exceeding $1.5 billion; 0.45% to the portion of
daily net assets exceeding $1.5 billion but not exceeding $2 billion; 0.425% to
the portion of daily net assets exceeding $2 billion but not exceeding $2.5
billion; 0.40% to the portion of daily net assets exceeding $2.5 billion but not
exceeding $5 billion; 0.375% to the portion of daily net assets exceeding $5
billion but not exceeding $7.5 billion; 0.35% to the portion of daily net assets
exceeding $7.5 billion but
<PAGE>
DEAN WITTER U.S. GOVERNMENT SECURITIES TRUST
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
- --------------------------------------------------------------------------------
not exceeding $10 billion; 0.325% to the portion of daily net assets exceeding
$10 billion but not exceeding $12.5 billion; and 0.30% to the portion of daily
net assets exceeding $12.5 billion.
Under the terms of the Agreement, in addition to managing the Fund's
investments, the Investment Manager maintains certain of the Fund's books and
records and furnishes, at its own expense, office space, facilities, equipment,
clerical, bookkeeping and certain legal services and pays the salaries of all
personnel, including officers of the Fund who are employees of the Investment
Manager. The Investment Manager also bears the cost of telephone services, heat,
light, power and other utilities provided to the Fund.
3. PLAN OF DISTRIBUTION--Shares of the Fund are distributed by Dean Witter
Distributors Inc. (the "Distributor"), an affiliate of the Investment Manager.
The Fund has adopted a Plan of Distribution (the "Plan") pursuant to Rule 12b-1
under the Act pursuant to which the Fund pays the Distributor compensation,
accrued daily and payable monthly, at an annual rate of 0.75% (0.65% on amounts
over $10 billion) of the lesser of: (a) the average daily aggregate gross sales
of the Fund's shares since the Fund's inception (not including reinvestment of
dividend or capital gain distributions) less the average daily aggregate net
asset value of the Fund's shares redeemed since the Fund's inception upon which
a contingent deferred sales charge has been imposed or upon which such charge
has been waived; or (b) the Fund's average daily net assets. Amounts paid under
the Plan are paid to the Distributor to compensate it for the services provided
and the expenses borne by it and others in the distribution of the Fund's
shares, including the payment of commissions for sales of the Fund's shares and
incentive compensation to and expenses of the account executives of Dean Witter
Reynolds Inc., an affiliate of the Investment Manager and Distributor, and other
employees or selected broker-dealers who engage in or support distribution of
the Fund's shares or who service shareholder accounts, including overhead and
telephone expenses, printing and distribution of prospectuses and reports used
in connection with the offering of the Fund's shares to other than current
shareholders and preparation, printing and distribution of sales literature and
advertising materials. In addition, the Distributor may be compensated under the
Plan for its opportunity costs in advancing such amounts which compensation
would be in the form of a carrying charge on any unreimbursed expenses incurred
by the Distributor.
Provided that the Plan continues in effect, any cumulative expenses incurred
by the Distributor but not yet recovered, may be recovered through future
distribution fees from the Fund and contingent deferred sales charges from the
Fund's shareholders.
The Distributor has informed the Fund that for the year ended December 31,
1994, it received approximately $23,000,000 in contingent deferred sales charges
from certain redemptions of the Fund's shares. The Fund's shareholders pay such
charges which are not an expense of the Fund.
4. SECURITY TRANSACTIONS AND TRANSACTIONS WITH AFFILIATES--Purchases and
sales/prepayments of portfolio securities, excluding short-term investments, for
the year ended December 31, 1994 were $2,379,385,047 and $3,496,432,485,
respectively.
Dean Witter Trust Company, an affiliate of the Investment Manager and
Distributor, is the Fund's transfer agent. At December 31, 1994, the Fund had
transfer agent fees and expenses payable of approximately $684,800.
On April 1, 1991, the Fund established an unfunded noncontributory defined
benefit pension plan covering all independent Trustees of the Fund who will have
served as independent Trustees for at least five years at the time of
retirement. Benefits under this plan are based on years of service and
compensation during the last five years of service. Aggregate pension costs for
the year ended December 31, 1994, included in Trustees' fees and expenses in the
Statement of Operations amounted to $8,162. At December 31, 1994, the Fund had
an accrued pension liability of $47,123 included in accrued expenses in the
Statement of Assets and Liabilities.
<PAGE>
DEAN WITTER U.S. GOVERNMENT SECURITIES TRUST
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
- --------------------------------------------------------------------------------
5. SHARES OF BENEFICIAL INTEREST--Transactions in shares of beneficial interest
were as follows:
<TABLE>
<CAPTION>
FOR THE YEAR ENDED FOR THE YEAR ENDED
DECEMBER 31, 1994 DECEMBER 31, 1993
---------------------------- ----------------------------
SHARES AMOUNT SHARES AMOUNT
------------ -------------- ------------ --------------
<S> <C> <C> <C> <C>
Sold....................................... 67,499,792 $ 600,440,123 168,705,889 $1,589,631,602
Reinvestment of dividends.................. 39,882,269 348,224,623 47,121,366 443,588,963
------------ -------------- ------------ --------------
107,382,061 948,664,746 215,827,255 2,033,220,565
Repurchased................................ (445,440,434) (3,875,613,067) (244,727,357) (2,304,921,251)
------------ -------------- ------------ --------------
Net decrease............................... (338,058,373) $(2,926,948,321) (28,900,102) $ (271,700,686)
------------ -------------- ------------ --------------
------------ -------------- ------------ --------------
</TABLE>
6. FEDERAL INCOME TAX STATUS--At December 31, 1994, the Fund had approximate
net capital loss carryovers which may be used to offset future capital gains to
the extent provided by regulations which are available through December 31 in
the following years (in thousands):
<TABLE>
<CAPTION>
1995 1996 1997 1998 1999 2000 2001 2002 TOTAL
- --------- --------- --------- --------- --------- --------- --------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
$228,402 $277,199 $270,987 $108,731 $261,526 $154,964 $263,492 $118,056 $1,683,357
</TABLE>
Capital losses incurred after October 31 ("Post-October" losses) within the
taxable year are deemed to arise on the first business day of the Fund's next
taxable year. The Fund incurred and will elect to defer net capital losses of
approximately $16,795,000 during fiscal 1994.
At December 31, 1994, the Fund had temporary book/tax differences primarily
attributable to Post-October losses and a permanent book/tax difference
attributable to expired capital loss carryover. To reflect reclassifications
arising from permanent book/tax differences for the year ended December 31,
1994, accumulated net realized loss was charged and paid-in-capital was credited
$196,402,927.
<PAGE>
DEAN WITTER U.S. GOVERNMENT SECURITIES TRUST
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Selected ratios and per share data for a share of beneficial interest
outstanding throughout each period:
<TABLE>
<CAPTION>
FOR THE YEAR ENDED DECEMBER 31,
--------------------------------------------------------------------------------------
1994 1993 1992 1991 1990 1989 1988 1987
--------- --------- --------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of
period.............................. $ 9.31 $ 9.30 $ 9.52 $ 9.37 $ 9.51 $ 9.42 $ 9.75 $ 10.33
--------- --------- --------- --------- --------- --------- --------- ---------
Net investment income................ 0.58 0.64 0.74 0.87 0.90 0.91 0.97 0.96
Net realized and unrealized gain
(loss) on investments............... (0.90) 0.01 (0.22) 0.15 (0.14) 0.09 (0.33) (0.58)
--------- --------- --------- --------- --------- --------- --------- ---------
Total from investment operations..... (0.32) 0.65 0.52 1.02 0.76 1.00 0.64 0.38
--------- --------- --------- --------- --------- --------- --------- ---------
Less dividends and distributions
from:
Net investment income.............. (0.58) (0.64) (0.74) (0.87) (0.90) (0.91) (0.97) (0.96)
Net realized gain.................. -- -- -- -- -- -- -- --
--------- --------- --------- --------- --------- --------- --------- ---------
Total dividends and distributions.... (0.58) (0.64) (0.74) (0.87) (0.90) (0.91) (0.97) (0.96)
--------- --------- --------- --------- --------- --------- --------- ---------
Net asset value, end of period....... $ 8.41 $ 9.31 $ 9.30 $ 9.52 $ 9.37 $ 9.51 $ 9.42 $ 9.75
--------- --------- --------- --------- --------- --------- --------- ---------
--------- --------- --------- --------- --------- --------- --------- ---------
TOTAL INVESTMENT RETURN+............. (3.51)% 7.13% 5.76% 11.43% 8.49% 11.10% 6.74% 3.92%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(in millions)....................... $ 8,211 $ 12,235 $ 12,484 $ 11,736 $ 9,829 $ 10,167 $ 10,366 $ 10,418
Ratios to average net assets:
Expenses........................... 1.22% 1.18% 1.20% 1.17% 1.23% 1.19% 1.21% 1.18%
Net investment income.............. 6.57% 6.78% 7.91% 9.23% 9.60% 9.62% 10.01% 9.63%
Portfolio turnover rate.............. 26% 32% 40% 104% 54% 44% 15% 51%
<CAPTION>
1986 1985
--------- ---------
<S> <C> <C>
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of
period.............................. $ 10.53 $ 10.47
--------- ---------
Net investment income................ 1.02 1.24
Net realized and unrealized gain
(loss) on investments............... (0.20) 0.13
--------- ---------
Total from investment operations..... 0.82 1.37
--------- ---------
Less dividends and distributions
from:
Net investment income.............. (1.02) (1.24)
Net realized gain.................. -- (0.07)
--------- ---------
Total dividends and distributions.... (1.02) (1.31)
--------- ---------
Net asset value, end of period....... $ 10.33 $ 10.53
--------- ---------
--------- ---------
TOTAL INVESTMENT RETURN+............. 8.23% 14.00%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(in millions)....................... $ 11,100 $ 7,511
Ratios to average net assets:
Expenses........................... 1.20% 1.30%
Net investment income.............. 9.72% 11.53%
Portfolio turnover rate.............. 93% 98%
<FN>
- ---------------
+ DOES NOT REFLECT THE DEDUCTION OF SALES CHARGE.
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER U.S. GOVERNMENT SECURITIES TRUST
REPORT OF INDEPENDENT ACCOUNTANTS
- --------------------------------------------------------------------------------
To the Shareholders and Trustees of Dean Witter U.S. Government Securities Trust
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 Dean Witter U.S. Government
Securities Trust (the "Fund") at December 31, 1994, 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 ten 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 owned at December 31, 1994 by correspondence with the
custodian and brokers, provide a reasonable basis for the opinion expressed
above.
PRICE WATERHOUSE LLP
New York, New York
February 10, 1995
<PAGE>
TRUSTEES
Jack F. Bennett
Michael Bozic
Charles A. Fiumefreddo DEAN WITTER
Edwin J. Garn U.S. GOVERNMENT
John R. Haire SECURITIES
Dr. Manuel H. Johnson TRUST
Paul Kolton
Michael E. Nugent
Philip J. Purcell
John L. Schroeder
OFFICERS
Charles A. Fiumefreddo
Chairman and Chief Executive Officer
Sheldon Curtis
Vice President, Secretary and General Counsel
Rajesh K. Gupta
Vice President
Thomas F. Caloia
Treasurer
TRANSFER AGENT
[Photo]
Dean Witter Trust Company
Harborside Financial Center - Plaza Two
Jersey City, New Jersey 07311
INDEPENDENT ACCOUNTANTS
Price Waterhouse LLP
1177 Avenue of the Americas
New York, New York 10036
INVESTMENT MANAGER
Dean Witter InterCapital Inc.
Two World Trade Center
New York, New York 10048
This report is submitted for the general
information of shareholders of the Fund.
For more detailed information about the
Fund, its officers and trustees, fees,
expenses and other pertinent information,
please see the prospectus of the Fund.
This report is not authorized for
distribution to prospective investors
in the Fund unless preceded or accompanied
by an effective prospectus.
ANNUAL REPORT
DECEMBER 31, 1994
<PAGE>
DEAN WITTER U.S. GOVERNMENT SECURITIES TRUST
GROWTH OF $10,000
($ IN THOUSANDS)
<TABLE>
<CAPTION>
DATE TOTAL LEHMAN U.S. GOVT. INDEX
<S> <C> <C>
December 31, 1984 $10,000 $10,000
December 31, 1985 $11,400 $12,043
December 31, 1986 $12,338 $13,887
December 31, 1987 $12,822 $14,192
December 31, 1988 $13,686 $15,190
December 31, 1989 $15,205 $17,352
December 31, 1990 $16,496 $18,865
December 31, 1991 $18,381 $21,755
December 31, 1992 $19,440 $23,328
December 31, 1993 $20,827 $25,814
December 31, 1994 $20,095(3) $24,942
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS
1 YEAR 5 YEARS 10 YEARS
<S> <C> <C>
-3.51(1) 5.74(1) 7.23(1)
-8.03(2) 5.45(2) 7.23(2)
Fund Lehman (4)
------- -------
Past performance is not predictive of future returns.
<FN>
- -----------------------------------
(1) Figure shown assumes reinvestment of all distributions and does not reflect
the deduction of any sales charges.
(2) Figure shown assumes reinvestment of all distributions and the deduction of
the maximum applicable contingent deferred sales charge (CDSC) (1 year-5%,
5 years-2%, 10 years-0%). See the Fund's current prospectus for complete
details on fees and sales charges.
(3) Closing value, assuming a complete redemption on December 31, 1994.
(4) The Lehman Brothers Mutual Fund General U.S. Government Index is a broad-
based, unmanaged measure of all U.S. Government and U.S. Treasury
Securities. The Index does not include any expenses, fees or charges.
</TABLE>
