DREYFUS TAX EXEMPT CASH MANAGEMENT
LETTER TO SHAREHOLDERS
Dear Shareholder:
We are pleased to provide you with this annual report on Dreyfus Tax
Exempt Cash Management. For its annual reporting period ended January 31,
1996, your Fund's Class A and Class B shares produced a yield of 3.66% and
3.41%, respectively. Income dividends of approximately $.037 per share were
paid during the period for Class A shares and $.034 for Class B shares.
Reinvesting these dividends and calculating the effect of compounding
resulted in effective yields of 3.72% and 3.46% for Class A shares and Class
B shares, respectively.* These dividends were exempt from Federal personal
income taxes.**
THE ECONOMY
On January 31, 1996, the last day of the Fund's reporting period, the
Federal Reserve Board once again lowered the Federal Funds rate another
quarter of a point to 5.25%. The Federal Reserve also reduced the Discount
Rate, the rate that the Fed charges banks for loans, to 5.0%. The reduction
in interest rates was a continuation of the easing monetary policy of the
Fed, a stance that has prevailed since last July.
Mounting evidence that economic growth was indeed slowing, combined with
favorable inflation reports, indicated that the threat of recession
outweighed near-term worry of a resurgence in price inflation. The Consumer
Price Index rose only 2.5% in 1995, the lowest rate in nearly a decade. It
also marked the fifth consecutive year that the CPI was in the 3% or less
range. The consumer sector of the economy was of increasing concern to
economic policy makers. The consumer sector comprises two-thirds of the
nation's economic activity, and retail sales reports in December revealed the
worst holiday season since the 1990-91 recession. Personal income growth
remained sluggish. The Conference Board, an independent business group,
reported that the Board's index of consumer confidence declined sharply in
January as consumers worried about Federal budget negotiations and the recent
flurry of layoff announcements by major corporations.
Industrial production was only moderate. Output of the nation's factories
crept up 0.1% in December. The annual rate of production slowed to 0.8% in
the fourth quarter of 1995, compared with 3.2% for the previous three months.
For the full calendar year, output rose 3.2%, little more than half the 5.9%
rate in 1994.
There were strong indications that inflation was under control. Until
mid-year 1995, fear of inflation was the overriding concern of the Federal
Reserve. Now the focus seems to have shifted to actions designed to avoid
recession. Since last July, the Fed has moved three times to lower interest
rates. Should more signs of economic weakness emerge, it is likely that
short-term interest rates will continue to be lowered.
MARKET ENVIRONMENT
The short-term municipal market certainly is influenced by any Federal
Reserve Board decision to lower interest rates; however, market technicals
(i.e., supply/demand) were the overriding factor affecting the yields that
prevailed throughout this period. By Fall 1995, rates on short-term issues
had settled into a trading range. A steady interchange of variable rate
demand notes (VRDNs) between corporate holders and municipal money market
funds kept rates on these securities attractive, which resulted in an
inverted yield curve (rates on shorter maturities were higher than rates on
longer note issues) during most of the season. Despite the Fed's easing move
in early December, its second rate reduction of the year, rates on VRDNs
trended even higher toward year-end. That was a seasonal occurrence (as
prior years have
demonstrated) which reverses dramatically in January as cash returns to the
money market arena. The "January effect" leads to a high increase in demand
for VRDNs and, accordingly, a substantial yield drop on these issues as well.
The unusually large asset inflows abated by late January, thereby lessening
the high demand for VRDNs and serving to restore stability to short-term
yields.
In previous years, the impact on yield levels in January has been
substantial - lower rates have been sustained through most of the month and
into February. This year's drop in rates was less pronounced. We attribute
this aberration to the unresolved issues surrounding tax reform. This
uncertainty prompted remarketing agents to price VRDNs at more attractive
yields, which, of course, enhanced your Fund's overall performance.
THE PORTFOLIO
With the inverted yield curve, daily and weekly demand notes yielded
moderately more than both commercial paper and longer-term notes through most
of the period. Our investment strategy involved lengthening the portfolio's
maturity, when possible, in order to lock in rates that we felt would
outperform variable rate notes early in 1996.
The commercial paper and one-year note markets provided the primary means
for us to extend, while seeking to maintain a competitive yield. However,
our success in achieving the desired average maturity was limited due to a
scarcity of high quality tax exempt issues from which to choose. As a
result, your Fund's current average maturity still leaves room to extend
should a change in market or supply conditions warrant.
Included in this report is a series of detailed statements about your
Fund's holdings and its financial condition. We hope they are informative.
Please know that we appreciate greatly your continued confidence in the Fund
and in The Dreyfus Corporation.
Very truly yours,
[Richard J. Moynihan signature logo]
Richard J. Moynihan
Director, Municipal Portfolio Management
The Dreyfus Corporation
February 15, 1996
New York, N.Y.
* Effective yield is based upon dividends declared daily and reinvested
monthly.
**Some income may be subject to state and local taxes.
<TABLE>
<CAPTION>
DREYFUS TAX EXEMPT CASH MANAGEMENT
STATEMENT OF INVESTMENTS JANUARY 31, 1996
PRINCIPAL
TAX EXEMPT INVESTMENTS-100.0% AMOUNT VALUE
________ ________
<S> <C> <C>
ALABAMA-.3%
Birmingham Medical Clinic Board, Revenue, VRDN (U.A.H.S.F)
3.95% (LOC; Morgan Guaranty Trust Co.) (a,b)............................ $5,000,000 $5,000,000
ALASKA-.6%
Valdez Marine Terminal, Revenue, Refunding, VRDN (Exxon Pipeline Co. Project)
3.65%, Series C (Corp. Guaranty; Exxon Corp.) (a)....................... 8,975,000 8,975,000
ARKANSAS-.9%
University of Arkansas, University Revenues, VRDN (UAMS Campus)
3.30% (LOC; Credit Suisse) (a,b)........................................ 13,000,000 13,000,000
CALIFORNIA-6.4%
California Public Capital Improvements Financing Authority, Revenue
(Pooled Project) 3.70%, Series C, 3/15/96 (LOC; National Westminster Bank) (b) 10,000,000 10,000,000
California School Cash Reserve Program Authority, Notes
4.75%, Series A, 7/3/96 (Surety Bond; Industrial Bank of Japan)......... 24,000,000 24,096,642
Los Angeles County Transportation Commission, Sales Tax Revenue, Refunding, VRDN
2.90%, Series A (BPA; Bayerishe Landesbank and Insured; FGIC) (a)....... 14,200,000 14,200,000
Los Angeles Regional Airports Improvement Corporation, Lease Revenue, VRDN
(Los Angeles International-LAX 2) 3.75% (LOC; Societe Generale) (a,b)... 23,200,000 23,200,000
Sacramento County, MFHR, VRDN 3.40%, Series B (LOC; Dai-Ichi Kangyo Bank) (a,b) 6,900,000 6,900,000
Sacramento County Housing Authority, Refunding, VRDN (Grouse Run Apartments)
2.95% (LOC; Bank of America) (a,b)...................................... 6,500,000 6,500,000
Southern California Public Power Authority, Transmission Project Revenue, Refunding,
VRDN (Southern Transmission)
2.75% (Insured; AMBAC and LOC; Swiss Bank Corp.) (a,b).................. 8,000,000 8,000,000
COLORADO-3.2%
State of Colorado General Fund, TRAN 4.50%, 6/27/96......................... 15,000,000 15,049,412
City and County of Denver, MFHR, Refunding, VRDN (Parliament Apartments Project)
3.95% (Corp. Guaranty; Connecticut General Life Insurance Co.) (a)...... 22,200,000 22,200,000
Douglas County, MFHR, VRDN (Autumn Chase Project) 3.15% (LOC; Citibank) (a,b) 9,500,000 9,500,000
CONNECTICUT-1.2%
State of Connecticut, Special Tax Obligation Revenue, VRDN
(Transportation Infrastructure-1)
2.90% (LOC; Commerzbank) (a,b).......................................... 12,800,000 12,800,000
Connecticut Development Authority, PCR, Refunding, VRDN
(Connecticut Light and Power Co. Project)
3%, Series A (LOC; Deutsche Bank) (a,b)................................. 5,000,000 5,000,000
DELAWARE-3.8%
Delaware Economic Development Authority, Revenue, VRDN (Hospital Billing Collection):
3.20%, Series A (Insured; MBIA and Liquidity; Morgan Stanley Group) (a). 9,700,000 9,700,000
DREYFUS TAX EXEMPT CASH MANAGEMENT
STATEMENT OF INVESTMENTS (CONTINUED) JANUARY 31, 1996
PRINCIPAL
TAX EXEMPT INVESTMENTS (CONTINUED) AMOUNT VALUE
________ ________
DELAWARE (CONTINUED)
Delaware Economic Development Authority, Revenue, VRDN
(Hospital Billing Collection) (continued):
3.20%, Series B (Insured; MBIA and Liquidity; Morgan Stanley Group) (a) $33,200,000 $33,200,000
3.20%, Series C (Insured; MBIA and Liquidity; Morgan Stanley Group) (a) 11,700,000 11,700,000
DISTRICT OF COLUMBIA-3.9%
District of Columbia, VRDN:
(General Fund Recovery) 3.85%, Series B-3 (LOC; Landesbank Hessen) (a,b) 25,000,000 25,000,000
Refunding:
3.95%, Series A-6 (LOC; National Westminster Bank) (a,b).............. 11,800,000 11,800,000
3.95%, Series A-5 (LOC; Bank of Nova Scotia) (a,b).................... 8,300,000 8,300,000
Revenue (American Association for the Advancement of Science Issue Project)
3.85% (LOC; Nations Bank) (a,b)....................................... 11,000,000 11,000,000
FLORIDA-3.7%
Dade County, Water and Sewer Systems Revenue, VRDN
3.05% (Insured; FGIC and Liquidity; Commerzbank) (a).................... 18,600,000 18,600,000
Dade County Industrial Development Authority, Exempt Facilities
Revenue, Refunding, VRDN (Florida Power and Light Co.)
3.75% (Corp. Guaranty; Florida Power and Light Co.) (a)................. 11,450,000 11,450,000
Orange County Housing Finance Authority, MFHR, VRDN (Heather Glenn Apartments)
3.05% (LOC; FNMA) (a,b)................................................. 12,700,000 12,700,000
Sunshine State Governmental Financing Commission, Revenue, CP
3.75%, 2/12/96 (Liquidity; State Board of Administration of Florida).... 11,000,000 11,000,000
GEORGIA-.9%
Burke County Development Authority, PCR, VRDN (Georgia Power Co.
Project-Vogtle)
3.80% (Corp. Guaranty; Georgia Power Co.) (a)........................... 13,400,000 13,400,000
IDAHO-.7%
State of Idaho, TAN 4.50%, 6/27/96.......................................... 10,000,000 10,027,094
ILLINOIS-2.6%
Glendale Heights, Multi-Family Revenue, VRDN (Glendale Lake Project)
3.15% (LOC; Citibank) (a,b)............................................. 15,545,000 15,545,000
Illinois Health Facilities Authority, Revenue, VRDN:
(Northwestern Memorial Hospital)
3.85% (Corp. Guaranty; Northwestern Memorial Hospital) (a)............ 14,600,000 14,600,000
(SSM Health Care Project) 3.25%, Series A (LOC; Rabobank) (a,b)......... 6,700,000 6,700,000
INDIANA-2.4%
Indiana Bond Bank, Advanced Funding Notes 4.25%, Series A-2, 1/9/97......... 20,000,000 20,136,200
Petersburg, PCR, Refunding, VRDN (Indiana Power and Light)
3.25%, Series B (Insured; AMBAC and Liquidity; Indianapolis Power and Light) (a) 15,000,000 15,000,000
DREYFUS TAX EXEMPT CASH MANAGEMENT
STATEMENT OF INVESTMENTS (CONTINUED) JANUARY 31, 1996
PRINCIPAL
TAX EXEMPT INVESTMENTS (CONTINUED) AMOUNT VALUE
________ ________
IOWA-.7%
Iowa School Corporations, Warrants Certificates, School Cash Anticipation Notes
4.75%, Series A, 6/28/96 (Insured; Capital Guaranty).................... $10,000,000 $10,035,019
KENTUCKY-.4%
Kentucky Association of Counties Reinsurance Trust, Revenue, VRDN
3.45% (LOC; Hong Kong Shang-Hai Banking Corp.) (a,b).................... 5,300,000 5,300,000
LOUISIANA-3.9%
Jefferson Parish Hospital Service District No.2, HR, VRDN 3.20% (Insured; FGIC) (a) 9,000,000 9,000,000
Louisiana Offshore Terminal Authority, Deepwater Port Revenue, Refunding,
VRDN
(Loop Inc.-First Stage) 3.70% (LOC; Union Bank of Switzerland) (a,b).... 9,300,000 9,300,000
Orleans Levee District, VRDN (Capital Recovery Funding Program)
3.75%, Series A (LOC; Fuji Bank) (a,b).................................. 9,800,000 9,800,000
Plaquemines Port Harbor and Terminal District, Port Facilities Revenue
(International Marine Terminal Project)
4.50%, Series A, 3/15/96 (LOC; Morgan Guaranty Trust Co.) (b)........... 12,100,000 12,100,000
West Baton Rouge Parish Industrial District No.3, Revenue, Refunding, VRDN
(Dow Chemical Co. Project)
3.85%, Series B (Corp. Guaranty; Dow Chemical Co.) (a).................. 15,800,000 15,800,000
MAINE-2.0%
Orrington, RRR, VRDN (Penobscott Energy Project)
3.975%, Series A (LOC: Bank of Nova Scotia, Bankers Trust, Canadian Imperial Bank
of Commerce, Long-Term Credit Bank of Japan and Toronto Dominion Bank) (a,b) 30,210,000 30,210,000
MASSACHUSETTS-5.6%
Commonwealth of Massachusetts, Notes 4.25%, 6/12/96......................... 50,000,000 50,107,105
Massachusetts Health and Educational Facilities Authority, Revenue, VRDN
(Capital Assets Program) 3.75%, Series D (BPA; Sanwa Bank and Insured; MBIA) (a) 10,200,000 10,200,000
Massachusetts Housing Finance Agency, SFHR
4.10%, 6/1/96 (GIC; FGIC Capital Markets)............................... 11,100,000 11,100,000
Massachusetts Water Research Authority, CP
3.65%, 2/9/96 (LOC; Morgan Guaranty Trust Co.) (b)...................... 10,000,000 10,000,000
MICHIGAN-6.5%
Michigan Building Authority, Revenue, CP
3.25%, Series 1, 2/15/96 (LOC; Canadian Imperial Bank of Commerce) (b).. 22,000,000 22,000,000
Michigan Hospital Finance Authority, VRDN (Hospital Equipment Loan Program)
3.05% (LOC; Comerica Bank) (a,b)........................................ 8,000,000 8,000,000
Michigan Housing Development Authority, LOR, VRDN (Laurel Valley)
3.05% (LOC; National Westminster Bank) (a,b)............................ 5,900,000 5,900,000
Michigan Municipal Bond Authority, Revenue, Notes:
5%, Series A, 5/3/96.................................................... 17,000,000 17,052,546
DREYFUS TAX EXEMPT CASH MANAGEMENT
STATEMENT OF INVESTMENTS (CONTINUED) JANUARY 31, 1996
PRINCIPAL
TAX EXEMPT INVESTMENTS (CONTINUED) AMOUNT VALUE
________ ________
MICHIGAN (CONTINUED)
Michigan Municipal Bond Authority, Revenue, Notes (continued):
4.50%, Series B, 7/3/96................................................. $10,000,000 $10,044,387
Michigan Strategic Fund, LOR, Refunding, VRDN (Detroit Edison)
3.75% (LOC; Barclays Bank) (a,b)........................................ 16,175,000 16,175,000
Midland County Economic Development Corporation, Economic Development, LOR,
Refunding, VRDN (Dow Chemical Co. Project)
3.70% (Corp. Guaranty; Dow Chemical Co.) (a)............................ 14,225,000 14,225,000
MINNESOTA-.8%
University of Minnesota, University Revenue (Full Faith and Credit)
3.65%, Series F, 2/1/96................................................. 11,500,000 11,500,000
MISSOURI-.7%
Cole County Industrial Development Authority, Industrial Revenue, VRDN
(Mobine Manufacturing Co. Project) 3.40% (LOC; Fuji Bank) (a,b)......... 2,940,000 2,940,000
Missouri Health and Educational Facilities Authority, Health Facilities
Revenue, VRDN
(SSM Health Care Project) 3.25%, Series A (LOC; Rabobank Nederland) (a,b) 6,800,000 6,800,000
NEBRASKA-2.1%
Nebraska Higher Education Loan Program Inc., Revenue, VRDN (Student Loan Program)
3.10%, Series C (BPA; Student Loan Marketing Association and Insured; MBIA) (a) 27,340,000 27,340,000
Nebraska Investment Finance Authority, HR, VRDN (Depreciation Assets)
3.20%, Series A (Insured; FGIC and Liquidity; First Bank National Association) (a) 2,920,000 2,920,000
NEW JERSEY-3.7%
State of New Jersey, CP 3.30%, 2/16/96 (Liquidity; Union Bank of Switzerland) 10,000,000 10,000,000
New Jersey Turnpike Authority, Revenue, Refunding, VRDN
2.80%, Series D (Insured; FGIC and LOC; Societe Generale) (a,b)......... 43,900,000 43,900,000
NEW YORK-18.1%
City of New York:
RAN:
4.50%, Series A, 4/11/96.............................................. 16,500,000 16,535,711
4.75%, 6/28/96 (LOC: Bank of Nova Scotia, Canadian Imperial Bank
of Commerce, Chemical Bank, Commerzbank, Morgan Guaranty Trust Co.
and Union Bank of Switzerland) (b)................................ 15,900,000 15,989,716
TAN 4.50%, Series A, 2/15/96............................................ 15,000,000 15,004,360
New York City Industrial Development Agency, Civil Facility Revenue, VRDN
(Children's Oncology Society-Ronald McDonald House)
2.90% (LOC; Barclays Bank) (a,b)........................................ 4,800,000 4,800,000
New York City Trust Cultural Resources Revenue, VRDN
(American Museum of Natural History)
2.90%, Series B (Insured; MBIA and SBPA; Credit Suisse) (a)............. 6,900,000 6,900,000
DREYFUS TAX EXEMPT CASH MANAGEMENT
STATEMENT OF INVESTMENTS (CONTINUED) JANUARY 31, 1996
PRINCIPAL
TAX EXEMPT INVESTMENTS (CONTINUED) AMOUNT VALUE
________ ________
NEW YORK (CONTINUED)
New York State Dormitory Authority, Revenues, VRDN (Metropolitan Museum of Art)
2.75%, Series A (Guaranteed by; Metropolitan Museum of Art) (a)......... $1,800,000 $1,800,000
New York State Energy Research and Development Authority, PCR, VRDN
(Orange/Rockland Utility)
2.90%, Series A (BPA; Societe Generale and Insured; AMBAC) (a).......... 18,500,000 18,500,000
New York State Local Government Assistance Corp., VRDN:
2.85%, Series B (LOC: Credit Suisse and Swiss Bank Corp.) (a,b)......... 18,400,000 18,400,000
2.85%, Series C (LOC; Landesbank Hessen) (a,b).......................... 26,500,000 26,500,000
2.90%, Series G (LOC; National Westminster Bank) (a,b).................. 27,300,000 27,300,000
2.95%, Series A (LOC: Credit Suisse, Swiss Bank Corp. and Union Bank of
Switzerland) (a,b).................................................... 40,900,000 40,900,000
New York State Medical Care Facilities Finance Agency, Revenue, VRDN
(Pooled Loan Equipment Program) 3% (LOC; Chemical Bank) (a,b)........... 45,700,000 45,700,000
Suffolk County, TAN 4%, Series 1, 8/15/96 (LOC: Canadian Imperial Bank of Commerce,
National Westminster Bank and West Deutsche Landesbank) (b)............. 23,000,000 23,084,750
OHIO-.8%
Cincinnati and Hamilton County Port Authority, IDR, VRDN (Multi-Color Corp. Project)
3.35% (LOC; PNC Bank of Ohio) (a,b)..................................... 3,000,000 3,000,000
Greater Cleveland Regional Transportation Authority, Capital Improvement,
BAN 4.10%, 4/10/96...................................................... 8,000,000 8,005,110
OREGON-1.3%
Klamath Falls, Electric Revenue (Salt Caves-Hydroelectric)
4.40%, Series E, 5/1/96 (Escrowed in; U.S. Treasury Bills).............. 18,435,000 18,435,000
PENNSYLVANIA-1.8%
Emmaus General Authority, Revenue, VRDN:
3.25%, Series E-9 (LOC; Midland Bank) (a,b)............................. 10,000,000 10,000,000
3.25%, Subseries G-5 (LOC; Midland Bank) (a,b).......................... 4,000,000 4,000,000
3.65%, Subseries E-5 (LOC; Midland Bank) (a,b).......................... 8,000,000 8,000,000
Washington County Authority, Lease Revenue, VRDN (Higher Education Pooled
Equipment Lease Project) 3.40%, Series 1985A (LOC; Sanwa Bank) (a,b).... 3,400,000 3,400,000
SOUTH CAROLINA-.3%
Sumter County, Industrial Revenue, VRDN (Bendix Corp. Project)
3.475% (LOC; Sumitomo Bank) (a,b)....................................... 4,000,000 4,000,000
TENNESSEE-.6%
Metro Nashville Airport Authority, Special Facilities Revenue, Refunding, VRDN
(American Airlines Project) 3.75%, Series A (LOC; Credit Suisse) (a,b).. 8,400,000 8,400,000
TEXAS-11.5%
Dallas County, Permanent Improvement Revenue
3.90%, Series C, 6/15/96 (SBPA; Union Bank of Switzerland).............. 9,100,000 9,100,000
DREYFUS TAX EXEMPT CASH MANAGEMENT
STATEMENT OF INVESTMENTS (CONTINUED) JANUARY 31, 1996
PRINCIPAL
TAX EXEMPT INVESTMENTS (CONTINUED) AMOUNT VALUE
________ ________
TEXAS (CONTINUED)
Greater East Texas Higher Education Authority Inc., Student Loan Revenue, Refunding,
VRDN 3.15%, Series A (LOC; Student Loan Marketing Association) (b)...... $ 21,000,000 $21,000,000
Harris County Health Facilities Development Corporation, HR, VRDN:
(Methodist Hospital Systems Project)
3.85% (Liquidity: Methodist Hospital and Morgan Guaranty Trust Co.) (a) 5,000,000 5,000,000
(Texas Children's Hospital) 3.25%, Series B (LOC; Bank of America) (a,b) 8,300,000 8,300,000
(TIRR Project) 3.80% (LOC; Texas Commerce Bank) (a,b)................... 3,340,000 3,340,000
City of Houston:
Certificates of Obligation, VRDN 3.25%, Series A (BPA; Morgan Guaranty
Trust Co.) (a).............................................................. 6,400,000 6,400,000
CP 3.50%, Series A, 3/6/96 (BPA; Toronto-Dominion Bank)................. 10,000,000 10,000,000
TRAN 4.50%, 6/27/96..................................................... 40,000,000 40,124,006
State of Texas, TRAN 4.75%, 8/30/96......................................... 9,000,000 9,063,998
Texas Department of Housing and Community Affairs, MFHR, VRDN (Higher Point III)
3.35% (LOC; Trust Co. Bank of Georgia) (a,b)............................ 12,490,000 12,490,000
Texas Health Facilities Development Corporation, HR, VRDN (North Texas Pooled Health)
3.30%, Series 85A (LOC; Citibank) (a,b)................................. 18,400,000 18,400,000
University of Texas A & M, University Financing System Revenues, CP
3.40%, Series B, 2/21/96................................................ 23,700,000 23,700,000
VIRGINIA-2.7%
Henrico County Industrial Deveolpment Authority, Health Facility Revenue, VRDN
(Hermitage Project) 3.85% (LOC; Nations Bank of Virginia) (a,b)......... 39,700,000 39,700,000
WASHINGTON-2.3%
Snohomish County Public Utilities District No.1, Electric Revenue, VRDN
3.105% (Insured; MBIA and SBPA; Industrial Bank of Japan) (a)........... 10,760,000 10,760,000
Washington Public Power Supply System, Revenue, Refunding, VRDN
(Nuclear Project No.3)
3%, Series 3A-3 (LOC; National Westminster Bank) (a,b).................. 22,200,000 22,200,000
WISCONSIN-1.0%
State of Wisconsin, Notes 4.50%, 6/17/96.................................... 15,000,000 15,046,074
WYOMING-.6%
Lincoln County, PCR, VRDN (Exxon Project) 3.75% (Corp. Guaranty; Exxon Corp.) (a) 3,000,000 3,000,000
Platte County, PCR, VRDN (Tri-State Gas and Electric)
3.85%, Series A (LOC; Societe Generale) (a,b)........................... 4,900,000 4,900,000
U.S. RELATED-2.0%
Commonwealth of Puerto Rico Government Development Bank, CP 3.45%, 2/16/96.. 28,050,000 28,050,000
______________
TOTAL INVESTMENTS (cost $1,445,257,130)..................................... $1,445,257,130
==============
</TABLE>
<TABLE>
<CAPTION>
DREYFUS TAX EXEMPT CASH MANAGEMENT
SUMMARY OF ABBREVIATIONS
<S> <C> <S> <C>
AMBAC American Municipal Bond Assurance Corporation MBIA Municipal Bond Investors Assurance
BAN Bond Anticipation Notes Insurance Corporation
BPA Bond Purchase Agreement MFHR Multi-Family Housing Revenue
CP Commercial Paper PCR Pollution Control Revenue
FGIC Financial Guaranty Insurance Company RAN Revenue Anticipation Notes
FNMA Federal National Mortgage Association RRR Resources Recovery Revenue
GIC Guaranteed Investment Contract SBPA Standby Bond Purchase Agreement
HR Hospital Revenue SFHR Single Family Housing Revenue
IDR Industrial Development Revenue TAN Tax Anticipation Notes
LOC Letter of Credit TRAN Tax and Revenue Anticipation Notes
LOR Limited Obligation Revenue VRDN Variable Rate Demand Notes
</TABLE>
<TABLE>
<CAPTION>
SUMMARY OF COMBINED RATINGS (UNAUDITED)
<S> <C> <C> <C>
FITCH (C) OR MOODY'S OR STANDARD & POOR'S PERCENTAGE OF VALUE
_____ ______________ __________________ ____________________
F1+/F1 VMIG1/MIG1, P1 (d) SP1+/SP1, A1+/A1 (d) 96.5%
F2 VMIG2/MIG2, P2 SP2, A2 2.1
AAA/AA (e) Aaa/Aa (e) AAA/AA (e) 1.1
Not Rated (f) Not Rated (f) Not Rated (f) .3
______
100.0%
======
</TABLE>
NOTES TO STATEMENT OF INVESTMENTS:
(a) Securities payable on demand. The interest rate, which is subject to
change, is based upon bank prime rates or an index of market interest
rates.
(b) Secured by letters of credit. At January 31, 1996, 51.7% of the
Fund's net assets are backed by letters of credit issued by domestic
banks, foreign banks, brokerage firms, corporations and government
agencies.
(c) Fitch currently provides creditworthiness information for a limited
number of investments.
(d) P1 and A1 are the highest ratings assigned tax exempt commercial
paper by Moody's and Standard & Poor's, respectively.
(e) Notes which are not F, MIG or SP rated are represented by bond
ratings of the issuers.
(f) Securities which, while not rated by Fitch, Moody's or Standard &
Poor's have been determined by the Fund's Board of Trustees to be of
comparable quality to those rated securities in which the Fund may
invest.
See notes to financial statements.
<TABLE>
<CAPTION>
DREYFUS TAX EXEMPT CASH MANAGEMENT
STATEMENT OF ASSETS AND LIABILITIES JANUARY 31, 1996
<S> <C> <C>
ASSETS:
Investments in securities, at value-Note 1(a)........................... $1,445,257,130
Cash.................................................................... 10,165,707
Interest receivable..................................................... 11,227,494
Prepaid expenses........................................................ 84,397
______________
1,466,734,728
LIABILITIES:
Due to The Dreyfus Corporation.......................................... $ 266,437
Due to Distributor...................................................... 17,506
Payable for investment securities purchased............................. 20,140,853 20,424,796
__________ ______________
NET ASSETS ................................................................ $1,446,309,932
===============
REPRESENTED BY:
Paid-in capital......................................................... $1,446,634,173
Accumulated net realized (loss) on investments.......................... (324,241)
______________
NET ASSETS at value......................................................... $1,446,309,932
===============
Shares of Beneficial Interest Outstanding:
Class A Shares
(unlimited number of $.001 par value shares authorized)............... 1,366,811,522
===============
Class B Shares
(unlimited number of $.001 par value shares authorized)............... 79,822,651
===============
NET ASSET VALUE per share:
Class A Shares
($1,366,496,942 / 1,366,811,522 shares)............................... $1.00
======
Class B Shares
($79,812,990 / 79,822,651 shares)..................................... $1.00
======
STATEMENT OF OPERATIONS YEAR ENDED JANUARY 31, 1996
INVESTMENT INCOME:
INTEREST INCOME......................................................... $56,892,951
EXPENSES:
Management fee-Note 2(a).............................................. $ 2,960,202
Distribution fees (Class B Shares)-Note 2(b).......................... 151,174
_____________
TOTAL EXPENSES.................................................... 3,111,376
______________
INVESTMENT INCOME-NET....................................................... 53,781,575
NET REALIZED (LOSS) ON INVESTMENTS-Note 1(b)................................ (146,895)
______________
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........................ $53,634,680
===============
See notes to financial statements.
</TABLE>
<TABLE>
<CAPTION>
DREYFUS TAX EXEMPT CASH MANAGEMENT
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED JANUARY 31,
_____________________________
1995 1996
____________ _____________
<S> <C> <C>
OPERATIONS:
Investment income-net............................................... $40,504,671 $53,781,575
Net realized (loss) on investments.................................. (177,346) (146,895)
___________ ____________
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS.......... 40,327,325 53,634,680
___________ ____________
DIVIDENDS TO SHAREHOLDERS FROM:
Investment income-net:
Class A Shares.................................................... (39,819,339) (51,734,254)
Class B Shares.................................................... (685,332) (2,047,321)
Net realized gain on investments:
Class A Shares.................................................... (110,083) -
Class B Shares.................................................... (1,393) -
___________ ____________
TOTAL DIVIDENDS............................................... (40,616,147) (53,781,575)
___________ ____________
BENEFICIAL INTEREST TRANSACTIONS ($1.00 per share):
Net proceeds from shares sold:
Class A Shares.................................................... 10,802,933,482 9,164,962,455
Class B Shares.................................................... 125,274,442 246,403,713
Dividends reinvested:
Class A Shares.................................................... 6,851,313 9,367,571
Class B Shares.................................................... 431,015 1,222,265
Cost of shares redeemed:
Class A Shares.................................................... (11,249,985,511) (9,106,993,170)
Class B Shares.................................................... (78,275,664) (215,233,621)
___________ ____________
INCREASE (DECREASE) IN NET ASSETS FROM BENEFICIAL INTEREST
TRANSACTIONS................................................ (392,770,923) 99,729,213
___________ ____________
TOTAL INCREASE (DECREASE) IN NET ASSETS..................... (393,059,745) 99,582,318
NET ASSETS:
Beginning of year................................................... 1,739,787,359 1,346,727,614
___________ ____________
End of year......................................................... $1,346,727,614 $1,446,309,932
============== ==============
See notes to financial statements.
</TABLE>
DREYFUS TAX EXEMPT CASH MANAGEMENT
FINANCIAL HIGHLIGHTS
Contained below is per share operating performance data for a share of
Beneficial Interest outstanding, total investment return, ratios to average
net assets and other supplemental data for each year indicated. This
information has been derived from the Fund's financial statements.
<TABLE>
<CAPTION>
CLASS A SHARES CLASS B SHARES
____________________________________________________ _____________________________
YEAR ENDED JANUARY 31, YEAR ENDED JANUARY 31,
____________________________________________________ _____________________________
PER SHARE DATA: 1992 1993 1994 1995 1996 1994(1) 1995 1996
_____ _____ _____ _____ _____ _____ _____ _____
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning
of year............... $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
_____ _____ _____ _____ _____ _____ _____ _____
INVESTMENT OPERATIONS;
Investment income-net... .042 .028 .023 .028 .037 .001 .025 .034
_____ _____ _____ _____ _____ _____ _____ _____
DISTRIBUTIONS;
Dividends from investment
income-net............ (.042) (.028) (.023) (.028) (.037) (.001) (.025) (.034)
_____ _____ _____ _____ _____ _____ _____ _____
Net asset value, end of year $1.00 $ 1.00 $1.00 $ 1.00 $1.00 $1.00 $1.00 $1.00
====== ======= ======= ======= ======= ======= ======= =======
TOTAL INVESTMENT RETURN..... 4.25% 2.83% 2.29% 2.83% 3.72% 1.83%(2) 2.57% 3.46%
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average
net assets............ .20% .20% .20% .20% .20% .45%(2) .45% .45%
Ratio of net investment income
to average net assets. 4.16% 2.77% 2.26% 2.73% 3.64% 1.87%(2) 2.74% 3.39%
Decrease reflected in above
expense ratios due to
undertaking by
the Manager........... .05% .04% .04% - - - - -
Net Assets, end of year
(000's omitted)....... $1,668,671 $1,838,786 $1,739,787 $1,299,301 $1,366,497 $1 $47,427 $79,813
(1) From January 10, 1994 (commencement of initial offering) to January 31, 1994.
(2) Annualized.
See notes to financial statements.
</TABLE>
DREYFUS TAX EXEMPT CASH MANAGEMENT
NOTES TO FINANCIAL STATEMENTS
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES:
Dreyfus Tax Exempt Cash Management (the "Fund") is registered under the
Investment Company Act of 1940 ("Act") as a diversified open-end management
investment company. The Fund's investment objective is to provide investors
with as high a level of current income exempt from Federal income tax as is
consistent with the preservation of capital and the maintenance of liquidity.
The Dreyfus Corporation ("Manager") serves as the Fund's investment adviser.
The Manager is a direct subsidiary of Mellon Bank, N.A.
Premier Mutual Fund Services, Inc. (the "Distributor") acts as the
distributor of the Fund's shares, which are sold without a sales load. The
Fund offers both Class A and Class B shares. Class B shares are subject to a
Service Plan adopted pusuant to Rule 12b-1 under the Act. Other differences
between the two Classes include the services offered to and the expenses
borne by each Class and certain voting rights.
It is the Fund's policy to maintain a continuous net asset value per
share of $1.00; the Fund has adopted certain investment, portfolio valuation
and dividend and distribution policies to enable it to do so. There is no
assurance, however, that the Fund will be able to maintain a stable net asset
value of $1.00.
(A) PORTFOLIO VALUATION: Investments are valued at amortized cost, which
has been determined by the Fund's Board of Trustees to represent the fair
value of the Fund's investments.
(B) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities
transactions are recorded on a trade date basis. Interest income, adjusted
for amortization of premiums and original issue discounts on investments, is
earned from settlement date and recognized on the accrual basis. Realized
gain and loss from securities transactions are recorded on the identified
cost basis. Cost of investments represents amortized cost.
(C) DIVIDENDS TO SHAREHOLDERS: It is the policy of the Fund to declare
dividends from investment income-net on each business day. Such dividends are
paid monthly. Dividends from net realized capital gain, if any, are normally
declared and paid annually, but the Fund may make distributions on a more
frequent basis to comply with the distribution requirements of the Internal
Revenue Code. To the extent that net realized capital gain can be offset by
capital loss carryovers, it is the policy of the Fund not to distribute such
gain.
(D) FEDERAL INCOME TAXES: It is the policy of the Fund to continue to
qualify as a regulated investment company, which can distribute tax exempt
dividends, by complying with the applicable provisions of the Internal
Revenue Code, and to make distributions of income and net realized capital
gain sufficient to relieve it from substantially all Federal income and
excise taxes.
The Fund has an unused capital loss carryover of approximately $289,000
available for Federal income tax purposes to be applied against future net
securities profits, if any, realized subsequent to January 31, 1996. The
carryover does not include net realized securities losses from November 1,
1995 through January 31, 1996 which are treated, for Federal income tax
purposes, as arising in fiscal 1997. If not applied, $177,000 of the
carryover expires in fiscal 2003 and $112,000 of the carryover expires in
fiscal 2004.
At January 31, 1996, the cost of investments for Federal income tax
purposes was substantially the same as the cost for financial reporting
purposes (see the Statement of Investments).
DREYFUS TAX EXEMPT CASH MANAGEMENT
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE 2-MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES:
(A) Pursuant to a management agreement ("Agreement") with the Manager,
the management fee is computed at the annual rate of .20 of 1% of the average
daily value of the Fund's net assets and is payable monthly.
Unless the Manager gives the Fund's investors 90 days notice to the
contrary, the Manager and not the Fund, will be liable for Fund expenses
(exclusive of taxes, brokerage, interest on borrowings and, with the prior
written consent of the necessary state securities commissions, extraordinary
expenses) other than the following expenses, which will be borne by the Fund:
the management fee, and with respect to the Fund's Class B shares, Rule 12b-1
Service Plan expenses.
Effective December 1, 1995, the Fund compensates Dreyfus Transfer, Inc.,
a wholly-owned subsidiary of the Manager, under a transfer agency agreement
for providing personnel and facilities to perform transfer agency services
for the Fund. Such compensation amounted to $5,019 for the period from
December 1, 1995 through January 31, 1996.
(B) Under the Class B Service Plan ("the Plan") adopted pursuant to Rule
12b-1 under the Act, the Fund (a) reimburses the Distributor for distributing
the Fund's Class B shares and (b) pays the Manager and Dreyfus Service
Corporation, a wholly-owned subsidiary of the Manager, and their affiliates
(collectively "Dreyfus") for advertising and marketing relating to the Fund's
Class B shares and for providing certain services relating to Class B
shareholder accounts, such as answering shareholder inquiries regarding the
Fund and providing reports and other information, and services related to the
maintenance of shareholder accounts ("Servicing"), at an aggregate annual
rate of .25 of 1% of the value of the average daily net assets of Class B.
Both the Distributor and Dreyfus may pay one or more Service Agents a fee in
respect of the Fund's Class B shares owned by the shareholders with whom the
Service Agent has a Servicing relationship or for whom the Service Agent is
the dealer or holder of record. Both the Distributor and Dreyfus determine
the amounts, if any, to be paid to the Service Agents under the Plan and the
basis on which such payments are made. The fees payable under the Plan are
payable without regard to actual expenses incurred. During the year ended
January 31, 1996, $151,174 was charged to the Fund pursuant to the Plan.
(C) Each trustee who is not an "affiliated person" as defined in the Act
receives an annual fee of $3,000 and an attendance fee of $500 per meeting.
DREYFUS TAX EXEMPT CASH MANAGEMENT
REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
SHAREHOLDERS AND BOARD OF TRUSTEES
DREYFUS TAX EXEMPT CASH MANAGEMENT
We have audited the accompanying statement of assets and liabilities of
Dreyfus Tax Exempt Cash Management, including the statement of investments,
as of January 31, 1996, and the related statement of operations for the year
then ended, the statement of changes in net assets for each of the two years
in the period then ended, and financial highlights for each of the years
indicated therein. These financial statements and financial highlights are
the responsibility of the Fund's management. Our responsibility is to express
an opinion on these financial statements and financial highlights based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. Our procedures included confirmation of
securities owned as of January 31, 1996 by correspondence with the custodian
and brokers. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audits provide
a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights
referred to above present fairly, in all material respects, the financial
position of Dreyfus Tax Exempt Cash Management at January 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 indicated years, in conformity with generally
accepted accounting principles.
[Ernst & Young Signature logo]
New York, New York
March 5, 1996
IMPORTANT TAX INFORMATION (UNAUDITED)
In accordance with Federal tax law, the Fund hereby designates all the
dividends paid from investment income-net during the fiscal year ended
January 31, 1996 as "exempt-interest dividends" (not subject to regular
Federal income tax).
DREYFUS TAX EXEMPT
CASH MANAGEMENT
200 PARK AVENUE
NEW YORK, NY 10166
MANAGER
THE DREYFUS CORPORATION
200 PARK AVENUE
NEW YORK, NY 10166
CUSTODIAN
THE BANK OF NEW YORK
90 WASHINGTON STREET
NEW YORK, NY 10286
TRANSFER AGENT &
DIVIDEND DISBURSING AGENT
DREYFUS TRANSFER, INC.
ONE AMERICAN EXPRESS PLAZA
PROVIDENCE, RI 02903
Further information is contained
in the Prospectus, which must
precede or accompany this report.
Printed in U.S.A. 264/675AR961
DREYFUS
TAX EXEMPT
CASH
MANAGEMENT
ANNUAL REPORT
January 31, 1996
