File No. 2-89275
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [ X ]
Pre-Effective Amendment No. [ ]
Post-Effective Amendment No. 19 [ X ]
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [ X ]
Amendment No. 19 [ X ]
(Check appropriate box or boxes.)
Dreyfus Tax Exempt Cash Management
(Exact Name of Registrant as Specified in Charter)
c/o The Dreyfus Corporation
200 Park Avenue, New York, New York 10166
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including Area Code: (212) 922-6000
Mark N. Jacobs, Esq.
200 Park Avenue
New York, New York 10166
(Name and Address of Agent for Service)
It is proposed that this filing will become effective (check appropriate box)
immediately upon filing pursuant to paragraph (b)
----
X on June 3, 1996 pursuant to paragraph (b)
----
60 days after filing pursuant to paragraph (a)(i)
----
On (date) pursuant to paragraph (a)(i)
----
75 days after filing pursuant to paragraph (a)(ii)
----
on (date) pursuant to paragraph (a)(ii) of Rule 485
----
If appropriate, check the following box:
this post-effective amendment designates a new effective date for a
previously filed post-effective amendment.
----
Registrant has registered an indefinite number of shares of its
beneficial interest under the Securities Act of 1933 pursuant to
Section 24(f) of the Investment Company Act of 1940. Registrant's Rule 24f-2
Notice for the fiscal year ended January 31, 1996 was filed on March 28,
1996.
Dreyfus Tax Exempt Cash Management
Cross-Reference Sheet Pursuant to Rule 495(a)
Items in
Part A of
Form N-1A Caption Page
_________ _______ ____
1 Cover Page Cover
2 Synopsis 2
3 Condensed Financial Information 3
4 General Description of Registrant 5
5 Management of the Fund 7
5(a) Management's Discussion of Fund's Performance *
6 Capital Stock and Other Securities 8
7 Purchase of Securities Being Offered 8
8 Redemption or Repurchase 10
9 Pending Legal Proceedings *
Items in
Part B of
Form N-1A
- ---------
10 Cover Page Cover
11 Table of Contents Cover
12 General Information and History B-19
13 Investment Objectives and Policies B-2
14 Management of the Fund B-7
15 Control Persons and Principal B-10
Holders of Securities
16 Investment Advisory and Other B-11
Services
_____________________________________
NOTE: * Omitted since answer is negative or inapplicable.
Dreyfus Tax Exempt Cash Management
Cross-Reference Sheet Pursuant to Rule 495(a) (continued)
Items in
Part B of
Form N-1A Caption Page
_________ _______ _____
17 Brokerage Allocation B-14
18 Capital Stock and Other Securities B-15
19 Purchase, Redemption and Pricing B-12, B-14,
of Securities Being Offered B-15
20 Tax Status *
21 Underwriters B-12
22 Calculations of Performance Data B-18
23 Financial Statements B-25
Items in
Part C of
Form N-1A
_________
24 Financial Statements and Exhibits C-1
25 Persons Controlled by or Under C-3
Common Control with Registrant
26 Number of Holders of Securities C-3
27 Indemnification C-3
28 Business and Other Connections of C-4
Investment Adviser
29 Principal Underwriters C-11
30 Location of Accounts and Records C-14
31 Management Services C-14
32 Undertakings C-14
_____________________________________
NOTE: * Omitted since answer is negative or inapplicable.
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PROSPECTUS JUNE 3, 1996
DREYFUS TAX EXEMPT CASH MANAGEMENT
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DREYFUS TAX EXEMPT CASH MANAGEMENT (THE "FUND") IS AN OPEN-END,
DIVERSIFIED, MANAGEMENT INVESTMENT COMPANY, KNOWN AS A MONEY MARKET MUTUAL
FUND. 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 FUND IS DESIGNED FOR INSTITUTIONAL INVESTORS, PARTICULARLY BANKS,
ACTING FOR THEMSELVES OR IN A FIDUCIARY, ADVISORY, AGENCY, CUSTODIAL OR
SIMILAR CAPACITY. FUND SHARES MAY NOT BE PURCHASED DIRECTLY BY INDIVIDUALS,
ALTHOUGH INSTITUTIONS MAY PURCHASE SHARES FOR ACCOUNTS MAINTAINED BY
INDIVIDUALS. SUCH INSTITUTIONS HAVE AGREED TO TRANSMIT COPIES OF THIS
PROSPECTUS TO EACH INDIVIDUAL OR ENTITY FOR WHOSE ACCOUNT THE INSTITUTION
PURCHASES FUND SHARES, TO THE EXTENT REQUIRED BY LAW.
BY THIS PROSPECTUS, THE FUND IS OFFERING CLASS A SHARES AND CLASS B
SHARES. CLASS A SHARES AND CLASS B SHARES ARE IDENTICAL, EXCEPT AS TO THE
SERVICES OFFERED TO AND THE EXPENSES BORNE BY EACH CLASS. CLASS B BEARS
CERTAIN COSTS PURSUANT TO A SERVICE PLAN ADOPTED IN ACCORDANCE WITH RULE 12B-1
UNDER THE INVESTMENT COMPANY ACT OF 1940. INVESTORS CAN INVEST, REINVEST OR
REDEEM SHARES AT ANY TIME WITHOUT CHARGE OR PENALTY IMPOSED BY THE FUND.
THE DREYFUS CORPORATION SERVES AS THE FUND'S INVESTMENT ADVISER.
AN INVESTMENT IN THE FUND IS NEITHER INSURED NOR GUARANTEED BY THE
U.S. GOVERNMENT. THERE CAN BE NO ASSURANCE THAT THE FUND WILL BE ABLE TO
MAINTAIN A STABLE NET ASSET VALUE OF $1.00 PER SHARE.
THIS PROSPECTUS SETS FORTH CONCISELY INFORMATION ABOUT THE FUND THAT
AN INVESTOR SHOULD KNOW BEFORE INVESTING. IT SHOULD BE READ AND RETAINED FOR
FUTURE REFERENCE.
THE STATEMENT OF ADDITIONAL INFORMATION, DATED JUNE 3, 1996, WHICH
MAY BE REVISED FROM TIME TO TIME, PROVIDES A FURTHER DISCUSSION OF CERTAIN
AREAS IN THIS PROSPECTUS AND OTHER MATTERS WHICH MAY BE OF INTEREST TO SOME
INVESTORS. IT HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION AND
IS INCORPORATED HEREIN BY REFERENCE. FOR A FREE COPY, WRITE TO THE FUND AT
144 GLENN CURTISS BOULEVARD, UNIONDALE, NEW YORK 11556-0144, OR CALL
1-800-554-4611. WHEN TELEPHONING, ASK FOR OPERATOR 144.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED
OR ENDORSED BY, ANY BANK, AND ARE NOT FEDERALLY INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD, OR ANY OTHER
AGENCY. MUTUAL FUND SHARES INVOLVE CERTAIN INVESTMENT RISKS, INCLUDING THE
POSSIBLE LOSS OF PRINCIPAL.
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TABLE OF CONTENTS
Page
Annual Fund Operating Expenses.................... 2
Condensed Financial Information................... 3
Yield Information................................. 4
Description of the Fund........................... 5
Management of the Fund............................ 7
How to Buy Shares................................. 8
Investor Services................................. 9
How to Redeem Shares.............................. 10
Service Plan...................................... 11
Shareholder Services Plan......................... 12
Dividends, Distributions and Taxes................ 12
General Information............................... 14
Appendix.......................................... 16
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
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<TABLE>
<CAPTION>
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average daily net assets)
CLASS A CLASS B
SHARES SHARES
<S> <C> <C>
Management Fees...................................................... .20% .20%
12b-1 Fees (distribution and servicing).............................. --- .25%
Total Fund Operating Expenses........................................ .20% .45%
EXAMPLE:
An investor would pay the following expenses on a $1,000
investment, assuming (1) 5% annual return and (2) redemption at
the end of each time period:
CLASS A CLASS B
SHARES SHARES
1 YEAR................................. $ 2 $ 5
3 YEARS................................ $ 6 $14
5 YEARS................................ $11 $25
10 YEARS............................... $26 $57
</TABLE>
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THE AMOUNTS LISTED IN THE EXAMPLE SHOULD NOT BE CONSIDERED AS
REPRESENTATIVE OF PAST OR FUTURE EXPENSES AND ACTUAL EXPENSES MAY BE GREATER
OR LESS THAN THOSE INDICATED. MOREOVER, WHILE THE EXAMPLE ASSUMES A 5% ANNUAL
RETURN, THE FUND'S ACTUAL PERFORMANCE WILL VARY AND MAY RESULT IN AN ACTUAL
RETURN GREATER OR LESS THAN 5%.
- ---------------------------------------------------------------------------
The purpose of the foregoing table is to assist investors in
understanding the costs and expenses borne by the Fund, the payment of which
will reduce investors' annual return. Unless The Dreyfus Corporation gives
the Fund's investors at least 90 days' notice to the contrary, The Dreyfus
Corporation, 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: (i) the
management fee payable by the Fund monthly at the annual rate of .20 of 1% of
the value of the Fund's average daily net assets and (ii) as to Class B
shares only, payments made pursuant to the Fund's Service Plan at the annual
rate of .25 of 1% of the value of the average daily net assets of Class B.
Institutions and certain Service Agents (as defined below) effecting
transactions in Fund shares for the accounts of their clients may charge
their clients direct fees in connection with such transactions; such fees are
not reflected in the foregoing table. See "Management of the Fund," "How to
Buy Shares," "Service Plan" and "Shareholder Services Plan."
Page 2
CONDENSED FINANCIAL INFORMATION
The information in the following tables has been audited by Ernst &
Young LLP, the Fund's independent auditors, whose report thereon appears in
the Statement of Additional Information. Further financial data and related
notes are included in the Statement of Additional Information, available upon
request.
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
--------------------------------------------------------------------------------------
YEAR ENDED JANUARY 31,
---------------------------------------------------------------------------------------
1987 1988 1989 1990 1991 1992 1993 1994 1995 1996
-------- ------- ------- -------- ------- ------ ------ ------ ------ -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value, beginning of year $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
------- ------ ------ ------- ------- ------- ------ ------- ------ -----
INVESTMENT OPERATIONS;
Investment income-net...... .045 .044 .052 .062 .057 .042 .028 .023 .028 .037
------- ------ ------ ------- ------- ------- ------ ------- ------ -----
DISTRIBUTIONS;
Dividends from investment
income-net.............. (.045) (.044) (.052) (.062) (.057) (.042) (.028) (.023) (.028) (.037)
------- ------ ------ ------- ------- ------- ------ ------- ------ -----
Net asset value, end of year $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
======= ======== ====== ======= ====== ====== ======= ======= ====== =====
TOTAL INVESTMENT RETURN...... 4.58% 4.52% 5.27% 6.35% 5.85% 4.25% 2.83% 2.29% 2.83% 3.72%
RATIOS / SUPPLEMENTAL DATA:
Ratio of expenses to
average net assets .20% .20% .20% .20% .20% .20% .20% .20% .20% .20%
Ratio of net investment income to
average net assets...... 4.38% 4.41% 5.20% 6.15% 5.70% 4.16% 2.77% 2.26% 2.73% 3.64%
Decrease reflected in above expense
ratios due to undertaking by
The Dreyfus Corporation.. .04% .03% .03% .04% .03% .05% .04% .04% -- --
Net Assets, end of year
(000's omitted) $839,388 $1,029,739 $1,006,193 $1,147,753 $1,905,522 $1,668,671 $1,838,786 $1,739,787 $1,299,30 $1,366,497
</TABLE>
Page 3
<TABLE>
<CAPTION>
CLASS B SHARES
--------------------------------------
YEAR ENDED JANUARY 31,
--------------------------------------
1994(1) 1995 1996
------- ------- -------
<S> <C> <C> <C>
PER SHARE DATA:
Net asset value, beginning of year............................... $1.00 $1.00 $1.00
------- ------- -------
INVESTMENT OPERATIONS;
Investment income-net............................................ .001 .025 .034
------- ------- -------
DISTRIBUTIONS;
Dividends from investment income-net............................. (.001) (.025) (.034)
------- ------- -------
Net asset value, end of year..................................... $1.00 $1.00 $1.00
======== ======= =====
TOTAL INVESTMENT RETURN............................................ 1.83%(2) 2.57% 3.46%
RATIOS / SUPPLEMENTAL DATA:
Ratio of expenses to average net assets.......................... .45%(2) .45% .45%
Ratio of net investment income to average net assets............. 1.87%(2) 2.74% 3.39%
Net Assets, end of year (000's omitted).......................... $ 1 $47,427 $79,813
(1)From January 10, 1994 (commencement of initial offering) to January 31, 1994.
(2)Annualized.
</TABLE>
YIELD INFORMATION
From time to time, the Fund advertises its yield and effective yield.
Both yield figures are based on historical earnings and are not intended to
indicate future performance. It can be expected that these yields will
fluctuate substantially. The yield of the Fund refers to the income generated
by an investment in the Fund over a seven-day period (which period will be
stated in the advertisement). This income is then annualized. That is, the
amount of income generated by the investment during that week is assumed to
be generated each week over a 52-week period and is shown as a percentage of
the investment. The effective yield is calculated similarly, but, when
annualized, the income earned by an investment in the Fund is assumed to be
reinvested. The effective yield will be slightly higher than the yield
because of the compounding effect of this assumed reinvestment. The Fund's
yield and effective yield may reflect absorbed expenses pursuant to any
undertaking that may be in effect. See "Management of the Fund." Both yield
figures also take into account any applicable distribution and service fees.
As a result, at any given time, the performance of Class B should be expected
to be lower than that of Class A. See "Service Plan."
Tax equivalent yield is calculated by determining the pre-tax yield
which, after being taxed at a stated rate, would be equivalent to a stated
yield or effective yield calculated as described above.
Yield information is useful in reviewing the Fund's performance, but
because yields will fluctuate, under certain conditions such information may
not provide a basis for comparison with domestic bank deposits, other
investments which pay a fixed yield for a stated period of time, or other
investment companies which may use a different method of computing yield.
Comparative performance information may be used from time to time in
advertising or marketing the Fund's shares, including data from Lipper
Analytical Services, Inc., Bank Rate Monitortrademark, IBC/Donoghue's Money
Fund ReportRegistration Mark, Morningstar, Inc. and other industry
publications.
Page 4
DESCRIPTION OF THE FUND
GENERAL
By this Prospectus, two classes of shares of the Fund are being
offered -- Class A shares and Class B shares (each such class being referred
to as a "Class"). The Classes are identical, except that Class B shares are
subject to an annual distribution and service fee at the rate of .25% of the
value of the average daily net assets of Class B. The fee is payable for
advertising, marketing and distributing Class B shares and for ongoing
personal services relating to Class B shareholder accounts and services
related to the maintenance of such shareholder accounts pursuant to a Service
Plan adopted in accordance with Rule 12b-1 under the Investment Company Act
of 1940, as amended (the "1940 Act"). See "Service Plan." The distribution
and service fee paid by Class B will cause such Class to have a higher
expense ratio and to pay lower dividends than Class A.
WHEN USED IN THIS PROSPECTUS AND THE STATEMENT OF ADDITIONAL
INFORMATION, THE TERMS "INVESTOR" AND "SHAREHOLDER" REFER TO THE INSTITUTION
PURCHASING FUND SHARES AND DO NOT REFER TO ANY INDIVIDUAL OR ENTITY FOR WHOSE
ACCOUNT THE INSTITUTION MAY PURCHASE FUND SHARES. Such institutions have
agreed to transmit copies of this Prospectus and all relevant Fund materials,
including proxy materials, to each individual or entity for whose account the
institution purchases Fund shares, to the extent required by law.
INVESTMENT OBJECTIVE
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. It cannot
be changed without approval by the holders of a majority (as defined in the
1940 Act) of the Fund's outstanding voting shares. There can be no assurance
that the Fund's investment objective will be achieved. To accomplish its
investment objective, the Fund invests primarily in Municipal Obligations (as
described below). Securities in which the Fund invests may not earn as high a
level of current income as long-term or lower quality securities which
generally have less liquidity, greater market risk and more fluctuation in
market value.
MUNICIPAL OBLIGATIONS
Municipal Obligations are debt obligations issued by states,
territories and possessions of the United States and the District of Columbia
and their political subdivisions, agencies and instrumentalities, or
multistate agencies or authorities, the interest from which is, in the
opinion of bond counsel to the issuer, exempt from Federal income tax.
Municipal Obligations generally include debt obligations issued to obtain
funds for various public purposes as well as certain industrial development
bonds issued by or on behalf of public authorities. Municipal Obligations are
classified as general obligation bonds, revenue bonds and notes. General
obligation bonds are secured by the issuer's pledge of its faith, credit and
taxing power for the payment of principal and interest. Revenue bonds are
payable from the revenue derived from a particular facility or class of
facilities or, in some cases, from the proceeds of a special excise or other
specific revenue source, but not from the general taxing power. Tax exempt
industrial development bonds, in most cases, are revenue bonds and generally
do not carry the pledge of the credit of the issuing municipality, but
generally are guaranteed by the corporate entity on whose behalf they are
issued. Notes are short-term instruments which are obligations of the issuing
municipalities or agencies and are sold in anticipation of a bond sale,
collection of taxes or receipt of other revenues. Municipal Obligations
include municipal lease/purchase agreements which are similar to installment
purchase contracts for property or equipment issued by municipalities.
Municipal Obligations bear fixed, floating or variable rates of interest.
Page 5
MANAGEMENT POLICIES
It is a fundamental policy of the Fund that it will invest at least
80% of the value of its net assets (except when maintaining a temporary
defensive position) in Municipal Obligations. The Fund also may invest in
Taxable Investments of the quality described under "Appendix--Certain
Portfolio Securities--Taxable Investments."
The Fund seeks to maintain a net asset value of $1.00 per share for
purchases and redemptions. To do so, the Fund uses the amortized cost method
of valuing its securities pursuant to Rule 2a-7 under the 1940 Act, which
Rule includes various maturity, quality and diversification requirements,
certain of which are summarized as follows. In accordance with Rule 2a-7, the
Fund will maintain a dollar-weighted average portfolio maturity of 90 days or
less, purchase only instruments having remaining maturities of 13 months or
less and invest only in U.S. dollar denominated securities determined in
accordance with procedures established by the Fund's Board to present minimal
credit risks and which are rated in one of the two highest rating categories
for debt obligations by at least two nationally recognized statistical rating
organizations (or one rating organization if the instrument was rated only by
one such organization) or, if unrated, are of comparable quality as
determined in accordance with procedures established by the Fund's Board.
Moreover, the Fund will purchase commercial paper, or other instruments
having only commercial paper ratings, only if the security is rated in the
highest rating category by at least one nationally recognized statistical
rating organization or, if unrated, of comparable quality as determined in
accordance with procedures established by the Fund's Board. The nationally
recognized statistical rating organizations currently rating instruments of
the type the Fund may purchase are Moody's Investors Service, Inc.
("Moody's"), Standard & Poor's Ratings Group, a division of The McGraw-Hill
Companies, Inc. ("S&P"), and Fitch Investors Service, L.P. ("Fitch") and
their rating criteria are described in the "Appendix" to the Statement of
Additional Information. For further information regarding the amortized cost
method of valuing securities, see "Determination of Net Asset Value" in the
Statement of Additional Information. There can be no assurance that the Fund
will be able to maintain a stable net asset value of $1.00 per share.
From time to time, the Fund may invest more than 25% of the value of
its total assets in industrial development bonds which, although issued by
industrial development authorities, may be backed only by the assets and
revenues of the non-governmental users. Interest on Municipal Obligations
(including certain industrial development bonds) which are specified private
activity bonds, as defined in the Internal Revenue Code of 1986, as amended
(the "Code"), issued after August 7, 1986, while exempt from Federal income
tax, is a preference item for the purpose of the alternative minimum tax.
Where a regulated investment company receives such interest, a proportionate
share of any exempt-interest dividend paid by the investment company will be
treated as such a preference item to shareholders. The Fund will invest no
more than 20% of the value of its net assets in Municipal Obligations the
interest from which gives rise to a preference item for the purpose of the
alternative minimum tax and, except for temporary defensive purposes, in
other investments subject to Federal income tax.
INVESTMENT CONSIDERATIONS AND RISKS
GENERAL -- Even though interest-bearing securities are investments which
promise a stable stream of income, the prices of such securities are
inversely affected by changes in interest rates and, therefore, are subject
to the risk of market price fluctuations. The values of fixed-income
securities also may be affected by changes in the credit rating or financial
condition of the issuing entities.
INVESTING IN MUNICIPAL OBLIGATIONS -- The Fund may invest more than 25% of
the value of its total assets in Municipal Obligations which are related in
such a way that an economic, business or political development or change
affecting one such security also would affect the other securities; for
example, securities the interest upon which is paid from revenues of similar
types of projects, or securities whose issuers are located in the same state.
As a result, the Fund may be subject to greater risk as compared to a fund
that does not follow this practice.
Page 6
Certain municipal lease/purchase obligations in which the Fund may
invest may contain "non-appropriation" clauses which provide that the
municipality has no obligation to make lease payments in future years unless
money is appropriated for such purpose on a yearly basis. Although
"non-appropriation" lease/purchase obligations are secured by the leased
property, disposition of the leased property in the event of foreclosure
might prove difficult. In evaluating the credit quality of a municipal
lease/purchase obligation that is unrated, The Dreyfus Corporation will
consider, on an ongoing basis, a number of factors including the likelihood
that the issuing municipality will discontinue appropriating funding for the
leased property.
Certain provisions in the Code relating to the issuance of Municipal
Obligations may reduce the volume of Municipal Obligations qualifying for
Federal tax exemption. One effect of these provisions could be to increase
the cost of the Municipal Obligations available for purchase by the Fund and
thus reduce available yield. Shareholders should consult their tax advisers
concerning the effect of these provisions on an investment in the Fund.
Proposals that may restrict or eliminate the income tax exemption for
interest on Municipal Obligations may be introduced in the future. If any
such proposal were enacted that would reduce the availability of Municipal
Obligations for investment by the Fund so as to adversely affect Fund
shareholders, the Fund would reevaluate its investment objective and policies
and submit possible changes in the Fund's structure to shareholders for their
consideration. If legislation were enacted that would treat a type of
Municipal Obligation as taxable, the Fund would treat such security as a
permissible Taxable Investment within the applicable limits set forth herein.
SIMULTANEOUS INVESTMENTS -- Investment decisions for the Fund are made
independently from those of other investment companies advised by The Dreyfus
Corporation. If, however, such other investment companies desire to invest in
or dispose of, the same securities as the Fund, available investments or
opportunities for sales will be allocated equitably to each investment
company. In some cases, this procedure may adversely affect the size of the
position obtained for or disposed of by the Fund or the price paid or
received by the Fund.
MANAGEMENT OF THE FUND
INVESTMENT ADVISER -- The Dreyfus Corporation, located at 200 Park Avenue,
New York, New York 10166, was formed in 1947 and serves as the Fund's
investment adviser. The Dreyfus Corporation is a wholly-owned subsidiary of
Mellon Bank, N.A., which is a wholly-owned subsidiary of Mellon Bank
Corporation ("Mellon"). As of April 30, 1996, The Dreyfus Corporation managed
or administered approximately $79 billion in assets for more than 1.7 million
investor accounts nationwide.
The Dreyfus Corporation supervises and assists in the overall
management of the Fund's affairs under a Management Agreement with the Fund,
subject to the authority of the Fund's Board in accordance with Massachusetts
law.
Mellon is a publicly owned multibank holding company incorporated
under Pennsylvania law in 1971 and registered under the Federal Bank Holding
Company Act of 1956, as amended. Mellon provides a comprehensive range of
financial products and services in domestic and selected international
markets. Mellon is among the twenty-five largest bank holding companies in
the United States based on total assets. Mellon's principal wholly-owned
subsidiaries are Mellon Bank, N.A., Mellon Bank (DE) National Association,
Mellon Bank (MD), The Boston Company, Inc., AFCO Credit Corporation and a
number of companies known as Mellon Financial Services Corporations. Through
its subsidiaries, including The Dreyfus Corporation, Mellon managed more than
$237 billion in assets as of March 31, 1996, including approximately $83
billion in proprietary mutual fund assets. As of March 31, 1996, Mellon,
through various subsidiaries, provided non-investment services, such as
custodial or administration services, for more than $886 billion in assets,
including approximately $61 billion in mutual fund assets.
Page 7
For the fiscal year ended January 31, 1996, the Fund paid The Dreyfus
Corporation a monthly management fee at the annual rate of .20 of 1% of the
value of the Fund's average daily net assets.
Unless The Dreyfus Corporation gives the Fund's investors at least 90
days' notice to the contrary, The Dreyfus Corporation, 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: (i) the management fee payable by
the Fund monthly at the annual rate of .20 of 1% of the value of the Fund's
average daily net assets and (ii) as to Class B shares only, payments made
pursuant to the Fund's Service Plan at the annual rate of .25 of 1% of the
value of the average daily net assets of Class B. See "Service Plan." The
Fund will not reimburse The Dreyfus Corporation for any amounts it may bear.
In allocating brokerage transactions, The Dreyfus Corporation seeks
to obtain the best execution of orders at the most favorable net price.
Subject to this determination, TheDreyfus Corporation may consider, among
other things, the receipt of research services and/or the sale of shares of
the Fund or other funds managed, advised or administered by The Dreyfus
Corporation as factors in the selection of broker-dealers to execute
portfolio transactions for the Fund. See "Portfolio Transactions" in the
Statement of Additional Information.
The Dreyfus Corporation may pay the Fund's distributor for
shareholder services from The Dreyfus Corporation's own assets, including
past profits but not including the management fee paid by the Fund. The
Fund's distributor may use part or all of such payments to pay Service Agents
in respect of these services.
DISTRIBUTOR -- The Fund's distributor is Premier Mutual Fund Services, Inc.
(the "Distributor"), located at One Exchange Place, Boston, Massachusetts
02109. The Distributor's ultimate parent is Boston Institutional Group, Inc.
TRANSFER AND DIVIDEND DISBURSING AGENT AND CUSTODIAN -- Dreyfus Transfer,
Inc., a wholly-owned subsidiary of The Dreyfus Corporation, P.O. Box 9671,
Providence, Rhode Island 02940-9671, is the Fund's Transfer and Dividend
Disbursing Agent (the "Transfer Agent"). The Bank of New York, 90 Washington
Street, New York, New York 10286, is the Fund's Custodian.
HOW TO BUY SHARES
The Fund is designed for institutional investors, particularly banks,
acting for themselves or in a fiduciary, advisory, agency, custodial or
similar capacity. Fund shares may not be purchased directly by individuals,
although institutions may purchase shares for accounts maintained by
individuals. Generally, each investor will be required to open a single
master account with the Fund for all purposes. In certain cases, the Fund may
request investors to maintain separate master accounts for shares held by the
investor (i) for its own account, for the account of other institutions and
for accounts for which the institution acts as a fiduciary, and (ii) for
accounts for which the investor acts in some other capacity. An institution
may arrange with the Transfer Agent for sub-accounting services and will be
charged directly for the cost of such services.
The minimum initial investment is $10,000,000, unless: (a) the
investor has invested at least $10,000,000 in the aggregate among the Fund,
Dreyfus Cash Management, Dreyfus Cash Management Plus, Inc., Dreyfus
Institutional Short Term Treasury Fund, Dreyfus Government Cash Management,
Dreyfus Municipal Cash Management Plus, Dreyfus New York Municipal Cash
Management, Dreyfus Treasury Cash Management and Dreyfus Treasury Prime Cash
Management; or (b) the investor has, in the opinion of Dreyfus Institutional
Services Division, adequate intent and availability of funds to reach a
future level of investment of $10,000,000 among the funds identified above.
There is no minimum for subsequent purchases. The initial investment must be
accompanied by the Account Application. Share certificates are issued only
upon the investor's written request. No certificates are issued for
fractional shares. The Fund reserves the right to reject any purchase order.
It is not recommended that the Fund be used as a vehicle for Keogh, IRA or
other qualified retirement plans.
Page 8
Management understands that some financial institutions, securities
dealers and other industry professionals (collectively, "Service Agents") and
other institutions may charge their clients fees in connection with purchases
for the accounts of their clients. These fees would be in addition to any
amounts which might be received under the Service Plan. Service Agents may
receive different levels of compensation for selling different Classes of
shares. Investors should consult their Service Agent in this regard.
Fund shares may be purchased by wire, by telephone or through
compatible computer facilities. All payments should be made in U.S. dollars
and, to avoid fees and delays, should be drawn only on U.S. banks. For
instructions concerning purchases and to determine whether their computer
facilities are compatible with the Fund's, investors should call one of the
telephone numbers listed under "General Information" in this Prospectus.
Fund shares are sold on a continuous basis at the net asset value per
share next determined after an order in proper form and Federal Funds (monies
of member banks in the Federal Reserve System which are held on deposit at a
Federal Reserve Bank) are received by the Custodian. If an investor does not
remit Federal Funds, its payment must be converted into Federal Funds. This
usually occurs within one business day of receipt of a bank wire and within
two business days of receipt of a check drawn on a member bank of the Federal
Reserve System. Checks drawn on banks which are not members of the Federal
Reserve System may take considerably longer to convert into Federal Funds.
Prior to receipt of Federal Funds, the investor's money will not be invested.
The Fund's net asset value per share is determined as of 12:00 Noon,
New York time, on each day the New York Stock Exchange is open for business.
Net asset value per share of each Class is computed by dividing the value of
the Fund's net assets represented by such Class (i.e., the value of its
assets less liabilities) by the total number of shares of such Class
outstanding. See "Determination of Net Asset Value" in the Statement of
Additional Information.
Except in the case of telephone orders, investors whose payments are
received in or converted into Federal Funds by 12:00 Noon, New York time, by
the Custodian will receive the dividend declared that day. Investors whose
payments are received in or converted into Federal Funds after 12:00 Noon,
New York time, by the Custodian will begin to accrue dividends on the
following business day.
Telephone orders placed to Dreyfus Institutional Services Division
will become effective at the price determined at 12:00 Noon, New York time,
and the shares purchased will receive the dividend on Fund shares declared on
that day, if the telephone order is placed by 12:00 Noon, New York time, and
Federal Funds are received by 4:00 p.m., New York time, on that day.
Federal regulations require that an investor provide a certified
Taxpayer Identification Number ("TIN"), upon opening or reopening an account.
See "Dividends, Distributions and Taxes" and the Account Application for
further information concerning this requirement. Failure to furnish a
certified TIN to the Fund could subject an investor to a $50 penalty imposed
by the Internal Revenue Service (the "IRS").
INVESTOR SERVICES
FUND EXCHANGES -- An investor may purchase, in exchange for Class A or Class
B shares of the Fund, Class A or Class B shares of Dreyfus Cash Management,
Dreyfus Cash Management Plus, Inc., Dreyfus Institutional Short Term Treasury
Fund, Dreyfus Government Cash Management, Dreyfus Municipal Cash Management
Plus, Dreyfus New York Municipal Cash Management, Dreyfus Treasury Cash
Management and Dreyfus Treasury Prime Cash Management, which have different
investment objectives that may be of interest to investors. Upon an exchange
into a new account, the following investor services and privileges, as
applicable and where available, will be automatically carried over to the
fund into which the exchange is made: Telephone Exchange Privilege,
Redemption by Wire or Telephone, Redemption Through Compatible
page 9
Computer Facilities and the dividend/capital gain distribution option selected
by the investor.
To request an exchange, exchange instructions must be given in
writing or by telephone. See "How to Redeem Shares_Procedures." Before any
exchange, the investor must obtain and should review a copy of the current
prospectus of the fund into which the exchange is being made. Prospectuses
may be obtained by calling one of the telephone numbers listed under "General
Information." Shares will be exchanged at the net asset value next determined
after receipt of an exchange request in proper form. No fees currently are
charged investors directly in connection with exchanges, although the Fund
reserves the right, upon not less than 60 days' written notice, to charge
investors a nominal fee in accordance with rules promulgated by the
Securities and Exchange Commission. The Fund reserves the right to reject any
exchange request in whole or in part. The availability of Fund Exchanges may
be modified or terminated at any time upon notice to investors. See
"Dividends, Distributions and Taxes."
DREYFUS AUTO-EXCHANGE PRIVILEGE -- Dreyfus Auto-Exchange Privilege enables an
investor to invest regularly (on a semi-monthly, monthly, quarterly or annual
basis), in exchange for Class A or Class B shares of the Fund, in Class A or
Class B shares of Dreyfus Cash Management, Dreyfus Cash Management Plus,
Inc., Dreyfus Institutional Short Term Treasury Fund, Dreyfus Government Cash
Management, Dreyfus Municipal Cash Management Plus, Dreyfus New York
Municipal Cash Management, Dreyfus Treasury Cash Management or Dreyfus
Treasury Prime Cash Management, if the investor is a shareholder in such
fund. The amount an investor designates, which can be expressed either in
terms of a specific dollar or share amount, will be exchanged automatically
on the first and/or fifteenth of the month according to the schedule that the
investor has selected. Shares will be exchanged at the then-current net asset
value. The right to exercise this Privilege may be modified or cancelled by
the Fund or the Transfer Agent. An investor may modify or cancel the exercise
of this Privilege at any time by mailing written notification to Dreyfus
Institutional Services Division, EAB Plaza, 144 Glenn Curtiss Boulevard, 8th
Floor, Uniondale, New York 11556-0144. The Fund may charge a service fee for
the use of this Privilege. No such fee currently is contemplated. For more
information concerning this Privilege and the funds eligible to participate
in this Privilege, or to obtain a Dreyfus Auto-Exchange Authorization Form,
please call one of the telephone numbers listed under "General Information."
See "Dividends, Distributions and Taxes."
HOW TO REDEEM SHARES
GENERAL
Investors may request redemption of shares at any time and the shares
will be redeemed at the next determined net asset value.
The Fund imposes no charges when shares are redeemed. Service Agents
or other institutions may charge their clients a nominal fee for effecting
redemptions of Fund shares. Any share certificates representing Fund shares
being redeemed must be submitted with the redemption request. The value of
the shares redeemed may be more or less than their original cost, depending
upon the Fund's then current net asset value.
If a request for redemption is received in proper form by Dreyfus
Institutional Services Division by 12:00 Noon, New York time, the proceeds of
the redemption, if transfer by wire is requested, ordinarily will be
transmitted in Federal Funds on the same day and the shares will not receive
the dividend declared on that day. If the request is received later that day
by Dreyfus Institutional Services Division, the shares will receive the
dividend declared on that day and the proceeds of redemption, if wire
transfer is requested, ordinarily will be transmitted in Federal Funds on the
next business day.
The Fund ordinarily will make payment for all shares redeemed within
seven days after receipt by Dreyfus Institutional Services Division of a
redemption request in proper form, except as provided by the rules of the
Securities and Exchange Commission.
page 10
PROCEDURES
Investors may redeem Fund shares by wire or telephone, or through
compatible computer facilities as described below.
If an investor selects a telephone redemption privilege or telephone
exchange privilege (which is granted automatically unless the investor
refuses it), the investor authorizes the Transfer Agent to act on telephone
instructions from any person representing himself or herself to be an
authorized representative of the investor, and reasonably believed by the
Transfer Agent to be genuine. The Fund will require the Transfer Agent to
employ reasonable procedures, such as requiring a form of personal
identification, to confirm that instructions are genuine and, if it does not
follow such procedures, the Fund or the Transfer Agent may be liable for any
losses due to unauthorized or fraudulent instructions. Neither the Fund nor
the Transfer Agent will be liable for following telephone instructions
reasonably believed to be genuine.
During times of drastic economic or market conditions, investors may
experience difficulty in contacting the Fund or its designated agents by
telephone to request a redemption or exchange of Fund shares. In such cases,
investors should consider using the other redemption procedures described
herein.
REDEMPTION BY WIRE OR TELEPHONE _ Investors may redeem Fund shares by wire or
telephone. The redemption proceeds will be paid by wire transfer. Investors
can redeem shares by telephone by calling one of the telephone numbers listed
under "General Information." The Fund reserves the right to refuse any
request made by wire or telephone and may limit the amount involved or the
number of telephone redemptions. This procedure may be modified or terminated
at any time by the Transfer Agent or the Fund. The Statement of Additional
Information sets forth instructions for redeeming shares by wire. Shares for
which certificates have been issued may not be redeemed by wire or telephone.
REDEMPTION THROUGH COMPATIBLE COMPUTER FACILITIES -- The Fund makes available
to institutions the ability to redeem shares through compatible computer
facilities. Investors desiring to redeem shares in this manner should call
Dreyfus Institutional Services Division at one of the telephone numbers
listed under "General Information" to determine whether their computer
facilities are compatible and to receive instructions for redeeming shares in
this manner.
SERVICE PLAN
(Class B Only)
Class B shares are subject to a Service Plan adopted pursuant to Rule
12b-1 under the 1940 Act. Under the Service Plan, the Fund (a) reimburses the
Distributor for distributing Class B shares and (b) pays The Dreyfus
Corporation, Dreyfus Service Corporation, a wholly-owned subsidiary of The
Dreyfus Corporation, and any affiliate of either of them (collectively,
"Dreyfus") for advertising and marketing 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. Each of the Distributor and Dreyfus may
pay one or more Service Agents a fee in respect of the Fund's Class B shares
owned by shareholders with whom the Service Agent is the dealer or holder of
record. Each of the Distributor and Dreyfus determines the amounts, if any,
to be paid to Service Agents under the Service Plan and the basis on which
such payments are made. The fee payable for Servicing is intended to be a
"service fee" as defined in Article III, Section 26 of the NASD Rules of Fair
Practice. The fees payable under the Service Plan are payable without regard
to actual expenses incurred.
Page 11
SHAREHOLDER SERVICES PLAN
(Class A Only)
Class A shares are subject to a Shareholder Services Plan pursuant to
which the Fund has agreed to reimburse Dreyfus Service Corporation an amount
not to exceed an annual rate of .25 of 1% of the value of the average daily
net assets of Class A for certain allocated expenses of providing personal
services to, and/or maintaining accounts of, Class A shareholders. The
services provided may include personal services relating to 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. The Dreyfus Corporation, and not the
Fund, currently reimburses Dreyfus Service Corporation for any such allocated
expenses. See "Management of the Fund."
DIVIDENDS, DISTRIBUTIONS AND TAXES
The Fund ordinarily declares dividends from net investment income on
each day the New York Stock Exchange or the Transfer Agent is open for
business. Fund shares begin earning income dividends on the day the purchase
order is effective. The Fund's earnings for Saturdays, Sundays and holidays
are declared as dividends on the prior business day. Dividends usually are
paid on the last calendar day of each month, and are automatically reinvested
in additional Fund shares at net asset value or, at the investor's option,
paid in cash. If an investor redeems all shares in its account at any time
during the month, all dividends to which the investor is entitled will be
paid along with the proceeds of the redemption. An omnibus accountholder may
indicate in a partial redemption request that a portion of any accrued
dividends to which such account is entitled belongs to an underlying
accountholder who has redeemed all shares in his or her account, and such
portion of the accrued dividends will be paid to the accountholder along with
the proceeds of the redemption. Distributions from net realized securities
gains, if any, generally are declared and paid once a year, but the Fund may
make distributions on a more frequent basis to comply with the distribution
requirements of the Code), in all events in a manner consistent with the
provisions of the 1940 Act. The Fund will not make distributions from net
realized securities gains unless capital loss carryovers, if any, have been
utilized or have expired. Investors may choose whether to receive
distributions in cash or to reinvest in additional Fund shares at net asset
value. All expenses are accrued daily and deducted before declaration of
dividends to investors. Dividends paid by each Class will be calculated at
the same time and in the same manner and will be in the same amount, except
that the expenses attributable solely to Class A or Class B will be borne
exclusively by such Class. Class B shares will receive lower per share
dividends than Class A shares because of the higher expenses borne by Class
B. See "Annual Fund Operating Expenses."
Except for dividends from Taxable Investments, the Fund anticipates
that substantially all dividends paid by the Fund will not be subject to
Federal income tax (i.e., exempt-interest dividends). Dividends derived from
Taxable Investments, together with distributions from any net realized
short-term securities gains and all or a portion of any gains realized from
the sale or other disposition of certain market discount bonds, paid by the
Fund are taxable as ordinary income whether received in cash or reinvested in
Fund shares, if the beneficial holder of Fund shares is a citizen or resident
of the United States. No dividend paid by the Fund will qualify for the
dividends received deduction allowable to certain U.S. corporations.
Distributions from net realized long-term securities gains of the Fund
generally are taxable as long-term capital gains for Federal income tax
purposes if the beneficial holder of Fund shares is a citizen or resident of
the United States, regardless of how long shareholders have held their Fund
shares and whether such distributions are received in cash or reinvested in
Fund shares. The Code provides that the net capital gain of an individual
generally will not be subject to Federal income tax at a rate in excess of
28%. Under the
Page 12
Code, interest on indebtedness incurred or continued to
purchase or carry Fund shares which is deemed to relate to exempt-interest
dividends is not deductible. Dividends and distributions may be subject to
certain state and local taxes.
Although all or a substantial portion of the dividends paid by the
Fund may be excluded by beneficial holders of Fund shares from their gross
income for Federal income tax purposes, the Fund may purchase specified
private activity bonds, the interest from which may be (i) a preference item
for purposes of the alternative minimum tax, (ii) a component of the
"adjusted current earnings" preference item for purposes of the corporate
alternative minimum tax, as well as a component in computing the corporate
environmental tax, or (iii) a factor in determining the extent to which the
Social Security benefits of a beneficial holder of Fund shares are taxable.
If the Fund purchases such securities, the portion of the Fund's dividends
related thereto will not necessarily be tax exempt to a beneficial holder of
Fund shares who is subject to the alternative minimum tax and/or tax on
Social Security benefits and may cause a beneficial holder to be subject to
such taxes.
Taxable dividends derived from net investment income, together with
distributions from net realized short-term securities gains and all or a
portion of any gains realized from the sale or other disposition of certain
market discount bonds, paid by the Fund with respect to Fund shares
beneficially owned by a foreign person generally are subject to U.S.
nonresident withholding tax at the rate of 30%, unless the foreign person
claims the benefit of a lower rate specified in a tax treaty. Distributions
from net realized long-term securities gains paid by the Fund with respect to
Fund shares beneficially owned by a foreign person, generally will not be
subject to U.S. nonresident withholding tax. However, such distributions may
be subject to backup withholding, as described below, unless the foreign
person certifies his non-U.S. residency status.
Notice as to the tax status of an investor's dividends and
distributions will be mailed to such investor annually. Each investor also
will receive periodic summaries of such investor's account which will include
information as to dividends and distributions from securities gains, if any,
paid during the year. These statements set forth the dollar amount of income
exempt from Federal tax and the dollar amount, if any, subject to Federal
tax. These dollar amounts will vary depending on the size and length of time
of the investor's investment in the Fund. If the Fund pays dividends derived
from taxable income, it intends to designate as taxable the same percentage
of the day's dividend as the actual taxable income earned on that day bears
to total income earned on that day. Thus, the percentage of the dividend
designated as taxable, if any, may vary from day to day.
The exchange of shares of one fund for shares of another fund is
treated for Federal income tax purposes as a sale of the shares given in
exchange by the investor and, therefore, an exchanging investor may realize a
taxable gain or loss.
Federal regulations generally require the Fund to withhold ("backup
withholding") and remit to the U.S. Treasury 31% of taxable dividends and
distributions from net realized securities gains of the Fund paid to a
shareholder if such shareholder fails to certify either that the TIN
furnished in connection with opening an account is correct, or that such
shareholder has not received notice from the IRS of being subject to backup
withholding as a result of a failure to properly report taxable dividend or in
terest income on a Federal income tax return. Furthermore, the IRS may notify
the Fund to institute backup withholding if the IRS determines a
shareholder's TIN is incorrect or if a shareholder has failed to properly
report taxable dividend and interest income on a Federal income tax return.
A TIN is either the Social Security number or employer identification
number of the record owner of the account. Any tax withheld as a result of
backup withholding does not constitute an additional tax
page 13
imposed on the record owner of the account, and may be claimed as a credit on
the record owner's Federal income tax return.
Management of the Fund believes that the Fund has qualified for the
fiscal year ended January 31, 1996 as a "regulated investment company" under
the Code. The Fund intends to continue to so qualify if such qualification is
in the best interests of its shareholders. Such qualification relieves the
Fund of any liability for Federal income tax to the extent its earnings are
distributed in accordance with applicable provisions of the Code. The Fund is
subject to a non-deductible 4% excise tax, measured with respect to certain
undistributed amounts of taxable investment income and capital gains.
Each investor should consult its tax adviser regarding specific
questions as to Federal, state or local taxes.
GENERAL INFORMATION
The Fund was incorporated under Maryland law on January 27, 1984, and
commenced operations on March 12, 1985. On May 22, 1987 the Fund was
reorganized as an unincorporated business trust under the laws of the
Commonwealth of Massachusetts. The Fund is authorized to issue an unlimited
number of shares of beneficial interest, par value $.001 per share. The
Fund's shares are classified into two classes. Each share has one vote and
shareholders will vote in the aggregate and not by class except as otherwise
required by law or with respect to any matter which affects only one class.
Holders of Class B shares only, however, will be entitled to vote on matters
submitted to shareholders pertaining to the Service Plan.
Under Massachusetts law, shareholders could, under certain
circumstances, be held liable for the obligations of the Fund. However, the
Agreement and Declaration of Trust (the "Trust Agreement") disclaims
shareholder liability for acts or obligations of the Fund and requires that
notice of such disclaimer be given in each agreement, obligation or
instrument entered into or executed by the Fund or a Trustee. The Trust
Agreement provides for indemnification from the Fund's property for all
losses and expenses of any shareholder held personally liable for the
obligations of the Fund. Thus, the risk of a shareholder's incurring
financial loss on account of shareholder liability is limited to
circumstances in which the Fund itself would be unable to meet its
obligations, a possibility which management believes is remote. Upon payment
of any liability incurred by the Fund, the shareholder paying such liability
will be entitled to reimbursement from the general assets of the Fund. The
Fund intends to conduct its operations in such a way so as to avoid, as far
as possible, ultimate liability of the shareholders for liabilities of the
Fund. As described under "Management of the Fund" in the Statement of
Additional Information, the Fund ordinarily will not hold shareholder
meetings; however, shareholders under certain circumstances may have the
right to call a meeting of shareholders for the purpose of voting to remove
Trustees.
The Transfer Agent maintains a record of each investor's ownership
and sends confirmations and statements of account.
Investor inquiries may be made by writing to the Fund at 144 Glenn
Curtiss Boulevard, Uniondale, New York 11556-0144, or, in the case of
institutional investors, by calling in New York State 1-718-895-1650;
outside New York State call toll free 1-800-346-3621. Individuals or entities
for whom institutions may purchase or redeem Fund shares should call toll
free 1-800-554-4611.
The Glass-Steagall Act and other applicable laws prohibit Federally
chartered or supervised banks from engaging in certain aspects of the
business of issuing, underwriting, selling and/or distributing securities.
Accordingly, banks will perform only administrative and shareholder servicing
functions. While the matter is not free from doubt, the Fund's Board believes
that such laws should not preclude a bank from acting on behalf of clients as
contemplated by this Prospectus. However, judicial or administrative
decisions or interpretations of such laws, as well as changes in either
Federal or state statutes or regulations relating to the permissible
activities of banks and their subsidiaries or affiliates, could prevent a
bank from
Page 14
continuing to perform all or part of the activities contemplated by
this Prospectus. If a bank were prohibited from so acting, its shareholder
clients would be permitted to remain Fund shareholders and alternative means
for continuing the servicing of such shareholders would be sought. In such
event, changes in the operation of the Fund might occur and shareholders
serviced by such bank might no longer be able to avail themselves of any
automatic investment or other services then being provided by the bank. The
Fund does not expect that shareholders would suffer any adverse financial
consequences as a result of any of these occurrences.
page 15
APPENDIX
INVESTMENT TECHNIQUES
BORROWING MONEY _ The Fund may borrow money from banks, but only for
temporary or emergency (not leveraging) purposes, in an amount up to 15% of
the value of its total assets (including the amount borrowed) valued at the
lesser of cost or market, less liabilities (not including the amount
borrowed) at the time the borrowing is made. While borrowings exceed 5% of
the Fund's total assets, the Fund will not make any additional investments.
FORWARD COMMITMENTS -- The Fund may purchase Municipal Obligations and other
securities on a forward commitment or when-issued basis, which means that
delivery and payment take place a number of days after the date of the
commitment to purchase. The payment obligation and the interest rate
receivable on a forward commitment or when-issued security are fixed when the
Fund enters into the commitment, but the Fund does not make payment until it
receives delivery from the counterparty. The Fund will commit to purchase
such securities only with the intention of actually acquiring the securities,
but the Fund may sell these securities before the settlement date if it is
deemed advisable. A segregated account of the Fund consisting of cash, cash
equivalents or U.S. Government securities or other high quality liquid debt
securities at least equal at all times to the amount of the commitments will
be established and maintained at the Fund's custodian bank.
CERTAIN PORTFOLIO SECURITIES
CERTAIN TAX EXEMPT OBLIGATIONS -- The Fund may purchase floating and variable
rate demand notes and bonds, which are tax exempt obligations ordinarily
having stated maturities in excess of 13 months, but which permit the holder
to demand payment of principal at any time or at specified intervals not
exceeding 13 months, in each case upon not more than 30 days' notice.
Variable rate demand notes include master demand notes which are obligations
that permit the Fund to invest fluctuating amounts, at varying rates of
interest, pursuant to direct arrangements between the Fund, as lender, and
the borrower. These obligations permit daily changes in the amounts borrowed.
Frequently, such obligations are secured by letters of credit or other credit
support arrangements provided by banks. Changes in credit quality of banks
and other financial institutions that provide credit or liquidity
enhancements to the Fund's portfolio securities could cause losses to the
Fund and affect its share price. Because these obligations are direct lending
arrangements between the lender and borrower, it is not contemplated that
such instruments generally will be traded, and there generally is no
established secondary market for these obligations, although they are
redeemable at face value plus accrued interest. Accordingly, where these
obligations are not secured by letters of credit or other credit support
arrangements, the Fund's right to redeem is dependent on the ability of the
borrower to pay principal and interest on demand. Each obligation purchased
by the Fund will meet the quality criteria established for the purchase of
Municipal Obligations.
TAX EXEMPT PARTICIPATION INTERESTS -- The Fund may purchase from financial
institutions participation interests in Municipal Obligations (such as
industrial development bonds and municipal lease/purchase agreements). A
participation interest gives the Fund an undivided interest in the Municipal
Obligation in the proportion that the Fund's participation interest bears to
the total principal amount of the Municipal Obligation. These instruments may
have fixed, floating or variable rates of interest, with remaining maturities
of 13 months or less. If the participation interest is unrated or has been
given a rating below that which otherwise is permissible for purchase by the
Fund, it will be backed by an irrevocable letter of credit or guarantee of a
bank that the Fund's Board has determined meets the prescribed quality
standards for banks set forth below, or the payment obligation otherwise will
be collateralized by U.S. Government securities. For certain participation
interests, the Fund will have the right to demand payment, on not more than
seven days' notice, for
Page 16
all or any part of the Fund's participation interest
in the Municipal Obligation, plus accrued interest. As to these instruments,
the Fund intends to exercise its right to demand payment only upon a default
under the terms of the Municipal Obligation, as needed to provide liquidity
to meet redemptions, or to maintain or improve the quality of its investment
portfolio. A participation interest will not be purchased by the Fund unless
it receives an opinion of counsel to the effect that the interest received
through the participation interest is exempt from Federal income tax.
STAND-BY COMMITMENTS -- The Fund may acquire "stand-by commitments" with
respect to Municipal Obligations held in its portfolio. Under a stand-by
commitment, the Fund obligates a broker, dealer or bank to repurchase, at the
Fund's option, specified securities at a specified price and, in this
respect, stand-by commitments are comparable to put options. The exercise of
a stand-by commitment, therefore, is subject to the ability of the seller to
make payment on demand. The Fund will acquire stand-by commitments solely to
facilitate portfolio liquidity and does not intend to exercise its rights
thereunder for trading purposes. The Fund may pay for stand-by commitments if
such action is deemed necessary, thus increasing to a degree the cost of the
underlying Municipal Obligation and similarly decreasing such security's
yield to investors. Gains realized in connection with stand-by commitments
will be taxable.
ILLIQUID SECURITIES -- The Fund may invest up to 10% of the value of its net
assets in securities as to which a liquid trading market does not exist,
provided such investments are consistent with the Fund's investment
objective. Such securities may include securities that are not readily
marketable, such as certain securities that are subject to legal or
contractual restrictions on resale, and repurchase agreements providing for
settlement in more than seven days after notice. As to these securities, the
Fund is subject to a risk that should the Fund desire to sell them when a
ready buyer is not available at a price the Fund deems representative of
their value, the value of the Fund's net assets could be adversely affected.
TAXABLE INVESTMENTS -- From time to time, on a temporary basis other than for
temporary defensive purposes (but not to exceed 20% of the value of the
Fund's net assets) or for temporary defensive purposes, the Fund may invest
in taxable short-term investments ("Taxable Investments") consisting of:
notes of issuers having, at the time of purchase, a quality rating within the
two highest grades of Moody's, S&P or Fitch; obligations of the U.S.
Government, its agencies or instrumentalities; commercial paper rated not
lower than P-2 by Moody's, A-2 by S&P or F-2 by Fitch; certificates of
deposit of U.S. domestic banks, including foreign branches of domestic banks,
with assets of one billion dollars or more; time deposits; bankers'
acceptances and other short-term bank obligations; and repurchase agreements
in respect of any of the foregoing. Dividends paid by the Fund that are
attributable to income earned by the Fund from Taxable Investments will be
taxable to investors. See "Dividends, Distributions and Taxes." Except for
temporary defensive purposes, at no time will more than 20% of the value of
the Fund's net assets be invested in Taxable Investments and Municipal
Obligations the interest from which gives rise to a preference item for the
purpose of the alternative minimum tax. If the Fund purchases Taxable
Investments, it will value them using the amortized cost method and comply
with the provisions of Rule 2a-7 relating to purchases of taxable
instruments. Under normal market conditions, the Fund anticipates that not
more than 5% of the value of its total assets will be invested in any one
category of Taxable Investments. Taxable Investments are more fully described
in the Statement of Additional Information, to which reference hereby is
made.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS AND IN THE
FUND'S OFFICIAL SALES LITERATURE IN CONNECTION WITH THE OFFER OF THE FUND'S
SHARES, AND, IF GIVEN OR MADE, SUCH OTHER INFORMATION OR REPRESENTATIONS MUST
NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE FUND. THIS PROSPECTUS
DOES NOT CONSTITUTE AN OFFER IN ANY STATE IN WHICH, OR TO ANY PERSON TO WHOM,
SUCH OFFERING MAY NOT LAWFULLY BE MADE.
Page 17
PROSPECTUS
DREYFUS
TAX EXEMPT
CASH MANAGEMENT
COPYRIGHT LOGO DREYFUS SERVICE CORPORATION
264P060396
DREYFUS TAX EXEMPT CASH MANAGEMENT
CLASS A AND CLASS B SHARES
PART B
(STATEMENT OF ADDITIONAL INFORMATION)
JUNE 3, 1996
This Statement of Additional Information, which is not a prospectus,
supplements and should be read in conjunction with the current Prospectus
of Dreyfus Tax Exempt Cash Management (the "Fund"), dated June 3, 1996, as
it may be revised from time to time. To obtain a copy of the Fund's
Prospectus, please write to the Fund at 144 Glenn Curtiss Boulevard,
Uniondale, New York 11556-0144, or, in the case of institutional investors,
call the following numbers:
In New York State -- Call 1-718-895-1650
Outside New York State -- Call Toll Free 1-800-346-3621
Individuals or entities for whom institutions may purchase or redeem
Fund shares may write to the Fund at the above address or call toll free
1-800-554-4611 to obtain a copy of the Fund's Prospectus.
The Dreyfus Corporation (the "Manager") serves as the Fund's
investment adviser.
Premier Mutual Fund Services, Inc. (the "Distributor") is the
distributor of the Fund's shares.
TABLE OF CONTENTS
Page
Investment Objective and Management Policies. . . . . . . . . . . . . B-2
Management of the Fund. . . . . . . . . . . . . . . . . . . . . . . . B-7
Management Agreement. . . . . . . . . . . . . . . . . . . . . . . . . B-11
Purchase of Shares. . . . . . . . . . . . . . . . . . . . . . . . . . B-12
Service Plan (Class B Only) . . . . . . . . . . . . . . . . . . . . . B-13
Shareholder Services Plan (Class A Only). . . . . . . . . . . . . . . B-14
Redemption of Shares. . . . . . . . . . . . . . . . . . . . . . . . . B-15
Determination of Net Asset Value. . . . . . . . . . . . . . . . . . . B-16
Investor Services . . . . . . . . . . . . . . . . . . . . . . . . . . B-17
Dividends, Distributions and Taxes. . . . . . . . . . . . . . . . . . B-17
Portfolio Transactions. . . . . . . . . . . . . . . . . . . . . . . . B-18
Yield Information . . . . . . . . . . . . . . . . . . . . . . . . . . B-18
Information About the Fund. . . . . . . . . . . . . . . . . . . . . . B-19
Transfer and Dividend Disbursing Agent, Custodian,
Counsel and Independent Auditors . . . . . . . . . . . . . . . . . B-20
Appendix. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-21
Financial Statements. . . . . . . . . . . . . . . . . . . . . . . . . B-25
Report of Independent Auditors. . . . . . . . . . . . . . . . . . . . B-37
INVESTMENT OBJECTIVE AND MANAGEMENT POLICIES
The following information supplements and should be read in
conjunction with the sections in the Fund's Prospectus entitled
"Description of the Fund" and "Appendix."
Portfolio Securities
The average distribution of investments (at value) in Municipal
Obligations by ratings for the fiscal year ended January 31, 1996, computed
on a monthly basis, was as follows:
Fitch Moody's Standard
Investors Investors & Poor's
Service, L.P. Service, Inc. Ratings Group Percentage
("Fitch") or ("Moody's") or ("S&P") of Value
F-1 MIG 1 SP-1 96.2%
F-2 MIG 2 SP-2 2.2%
AAA/AA Aaa/Aa AAA/AA .9%
Not Rated Not Rated Not Rated .7% (*)
------
100.0%
======
______________________________
* Included in the Not Rated Category are securities comprising .7% of the
Fund's Market Value which, while not rated, has been determined by the
Manager to be of comparable quality to securities in the VMIGI/MIGI
or SP-1+/SP-1 rating categories.
Municipal Obligations. The term "Municipal Obligations" generally
includes debt obligations issued to obtain funds for various public
purposes, including the construction of a wide range of public facilities
such as airports, bridges, highways, housing, hospitals, mass
transportation, schools, streets and water and sewer works. Other public
purposes for which Municipal Obligations may be issued include refunding
outstanding obligations, obtaining funds for general operating expenses and
lending such funds to other public institutions and facilities. In
addition, certain types of industrial development bonds are issued by or on
behalf of public authorities to obtain funds to provide for the
construction, equipment, repair or improvement of privately operated
housing facilities, sports facilities, convention or trade show facilities,
airport, mass transit, industrial, port or parking facilities, air or water
pollution control facilities and certain local facilities for water supply,
gas, electricity, or solid waste or sewage disposal; the interest paid on
such obligations may be exempt from Federal income tax, although current
tax laws place substantial limitations on the size of such issues. Such
obligations are considered to be Municipal Obligations if the interest paid
thereon qualifies as exempt from Federal income tax in the opinion of bond
counsel to the issuer. There are, of course, variations in the security of
Municipal Obligations, both within a particular classification and between
classifications.
Floating and variable rate demand notes and bonds are tax exempt
obligations ordinarily having stated maturities in excess of 13 months, but
which permit the holder to demand payment of principal at any time, or at
specified intervals not exceeding 13 months, in each case upon not more
than 30 days' notice. The issuer of such obligations ordinarily has a
corresponding right, after a given period, to prepay in its discretion the
outstanding principal amount of the obligation plus accrued interest upon a
specified number of days' notice to the holders thereof. The interest rate
on a floating rate demand obligation is based on a known lending rate, such
as a bank's prime rate, and is adjusted automatically each time such rate
is adjusted. The interest rate on a variable rate demand obligation is
adjusted automatically at specified intervals.
For the purpose of diversification under the Investment Company Act of
1940, as amended (the "1940 Act"), the identification of the issuer of
Municipal Obligations depends on the terms and conditions of the security.
When the assets and revenues of an agency, authority, instrumentality or
other political subdivision are separate from those of the government
creating the subdivision and the security is backed only by the assets and
revenues of the subdivision, such subdivision would be deemed to be the
sole issuer. Similarly, in the case of an industrial development bond, if
that bond is backed only by the assets and revenues of the non-governmental
user, then such non-governmental user would be deemed to be the sole
issuer. If, however, in either case, the creating government or some other
entity guarantees a security, such a guaranty would be considered a
separate security and will be treated as an issue of such government or
other entity.
The yields on Municipal Obligations are dependent on a variety of
factors, including general economic and monetary conditions, money market
factors, conditions in the Municipal Obligations market, size of a
particular offering, maturity of the obligation and rating of the issue.
The imposition of the Fund's management fee, as well as other operating
expenses, will have the effect of reducing the yield to investors.
Municipal lease obligations or installment purchase contract
obligations (collectively, "lease obligations") have special risks not
ordinarily associated with Municipal Obligations. Although lease
obligations do not constitute general obligations of the municipality for
which the municipality's taxing power is pledged, a lease obligation
ordinarily is backed by the municipality's covenant to budget for,
appropriate and make the payments due under the lease obligation. However,
certain lease obligations contain "non-appropriation" clauses which provide
that the municipality has no obligation to make lease or installment
purchase payments in future years unless money is appropriated for such
purpose on a yearly basis. Although "non-appropriation" lease obligations
are secured by the leased property, disposition of the property in the
event of foreclosure might prove difficult. The Fund will seek to minimize
these risks by investing only in those lease obligations that (1) are rated
in one of the highest rating categories for debt obligations by at least
two nationally recognized statistical rating organizations (or one rating
organization if the lease obligation was rated by only one such
organization) or (2) if unrated, are purchased principally from the issuer
or domestic banks or other responsible third parties, in each case only if
the seller shall have entered into an agreement with the Fund providing
that the seller or other responsible third party will either remarket or
repurchase the municipal lease within a short period after demand by the
Fund. The staff of the Securities and Exchange Commission currently
considers certain lease obligations to be illiquid. Accordingly, not more
than 10% of the value of the Fund's net assets will be invested in lease
obligations that are illiquid and in other securities that are illiquid.
See "Investment Restriction No. 12" below.
Ratings of Municipal Obligations. If, subsequent to its purchase by
the Fund, (a) an issue of rated Municipal Obligations ceases to be rated in
the highest rating category by at least two rating organizations (or one
rating organization if the instrument was rated by only one such
organization) or the Fund's Board determines that it is no longer of
comparable quality or (b) the Manager becomes aware that any portfolio
security not so highly rated or any unrated security has been given a
rating by any rating organization below the rating organization's second
highest rating category, the Fund's Board will reassess promptly whether
such security presents minimal credit risk and will cause the Fund to take
such action as it determines is in the best interest of the Fund and its
shareholders; provided that the reassessment required by clause (b) is not
required if the portfolio security is disposed of or matures within five
business days of the Manager becoming aware of the new rating and the
Fund's Board is subsequently notified of the Manager's actions.
To the extent that the ratings given by Moody's, S&P or Fitch for
Municipal Obligations may change as a result of changes in such organiza-
tions or their rating systems, the Fund will attempt to use comparable
ratings as standards for its investments in accordance with the investment
policies contained in the Fund's Prospectus and this Statement of
Additional Information. The ratings of Moody's, S&P and Fitch represent
their opinions as to the quality of the Municipal Obligations which they
undertake to rate. It should be emphasized, however, that ratings are
relative and subjective and are not absolute standards of quality.
Although these ratings may be an initial criterion for selection of port-
folio investments, the Manager also will evaluate these securities and the
creditworthiness of the issuers of such securities based upon financial and
other available information.
Illiquid Securities. Where a substantial market of qualified
institutional buyers develops for certain restricted securities purchased
by the Fund pursuant to Rule 144A under the Securities Act of 1933, as
amended, the Fund intends to treat such securities as liquid securities in
accordance with procedures approved by the Fund's Board. Because it is not
possible to predict with assurance how the market for restricted securities
pursuant to Rule 144A will develop, the Fund's Board has directed the
Manager to monitor carefully the Fund's investments in such securities with
particular regard to trading activity, availability of reliable price
information and other relevant information. To the extent that, for a
period of time, qualified institutional buyers cease purchasing restricted
securities pursuant to Rule 144A, the Fund's investing in such securities
may have the effect of increasing the level of illiquidity in the Fund's
portfolio during such period.
Taxable Investments. Securities issued or guaranteed by the U.S.
Government or its agencies or instrumentalities include U.S. Treasury
securities, which differ in their interest rates, maturities and times of
issuance. Some obligations issued or guaranteed by U.S. Government
agencies and instrumentalities are supported by the full faith and credit
of the U.S. Treasury; others by the right of the issuer to borrow from the
U.S. Treasury; others by discretionary authority of the U.S. Government to
purchase certain obligations of the agency or instrumentality; and others
only by the credit of the agency or instrumentality. These securities bear
fixed, floating or variable rates of interest. Interest may fluctuate
based on generally recognized reference rates or the relationship of rates.
While the U.S. Government provides financial support to such U.S.
Government-sponsored agencies or instrumentalities, no assurance can be
given that it will always do so, since it is not so obligated by law.
Commercial paper consists of short-term, unsecured promissory notes
issued to finance short-term credit needs.
Certificates of deposit are negotiable certificates representing the
obligation of a bank to repay funds deposited with it for a specified
period of time.
Time deposits are non-negotiable deposits maintained in a banking
institution for a specified period of time (in no event longer than seven
days) at a stated interest rate. Investments in time deposits generally
are limited to London branches of domestic banks that have total assets in
excess of one billion dollars. Time deposits which may be held by the Fund
will not benefit from insurance from the Bank Insurance Fund or the Savings
Association Insurance Fund administered by the Federal Deposit Insurance
Corporation.
Bankers' acceptances are credit instruments evidencing the obligation
of a bank to pay a draft drawn on it by a customer. These instruments
reflect the obligation both of the bank and of the drawer to pay the face
amount of the instrument upon maturity. Other short-term bank obligations
may include uninsured, direct obligations bearing fixed, floating or
variable interest rates.
In a repurchase agreement, the Fund buys, and the seller agrees to
repurchase, a security at a mutually agreed upon time and price (usually
within seven days). The repurchase agreement thereby determines the yield
during the purchaser's holding period, while the seller's obligation to
repurchase is secured by the value of the underlying security. The Fund's
custodian will have custody of, and will hold in a segregated account,
securities acquired by the Fund under a repurchase agreement. Repurchase
agreements are considered by the staff of the Securities and Exchange
Commission to be loans by the Fund. In an attempt to reduce the risk of
incurring a loss on a repurchase agreement, the Fund will enter into
repurchase agreements only with domestic banks with total assets in excess
of $1 billion, or primary government securities dealers reporting to the
Federal Reserve Bank of New York, with respect to securities of the type in
which the Fund may invest, and will require that additional securities be
deposited with it if the value of the securities purchased should decrease
below resale price. Repurchase agreements could involve risks in the event
of a default or insolvency of the other party to the agreement, including
possible delays or restrictions upon the Fund's ability to dispose of the
underlying securities.
Management Policies
Forward Commitments. Municipal Obligations and other securities
purchased on a forward commitment or when-issued basis are subject to
changes in value (generally changing in the same way, i.e., appreciating
when interest rates decline and depreciating when interest rates rise)
based upon the public's perception of the creditworthiness of the issuer
and changes, real or anticipated, in the level of interest rates.
Securities purchased on a when-issued basis may expose a Fund to risks
because they may experience such fluctuations prior to their actual
delivery. Purchasing securities on a when-issued basis can involve the
additional risk that the yield available in the market when the delivery
takes place actually may be higher than that obtained in the transaction
itself. Purchasing securities on a when-issued basis when a Fund is fully
or almost fully invested may result in greater potential fluctuation in the
value of the Fund's net assets and its net asset value per share.
Investment Restrictions
The Fund has adopted investment restrictions numbered 1 through 10 as
fundamental policies, which cannot be changed without approval by the
holders of a majority (as defined in the 1940 Act) of the Fund's
outstanding voting shares. Investment restrictions numbered 11 and 12 are
not fundamental policies and may be changed by vote of a majority of the
Fund's Board members at any time. The Fund may not:
1. Purchase securities other than Municipal Obligations and Taxable
Investments as those terms are defined above and in the Fund's Prospectus.
2. Borrow money, except from banks for temporary or emergency (not
leveraging) purposes in an amount up to 15% of the value of the Fund's
total assets (including the amount borrowed) based on the lesser of cost or
market, less liabilities (not including the amount borrowed) at the time
the borrowing is made. While borrowings exceed 5% of the value of the
Fund's total assets, the Fund will not make any additional investments.
3. Sell securities short or purchase securities on margin.
4. Underwrite the securities of other issuers, except that the Fund
may bid separately or as part of a group for the purchase of Municipal
Obligations directly from an issuer for its own portfolio to take advantage
of the lower purchase price available.
5. Purchase or sell real estate, real estate investment trust
securities, commodities or commodity contracts, or oil and gas interests,
but this shall not prevent the Fund from investing in Municipal Obligations
secured by real estate or interests therein.
6. Make loans to others except through the purchase of qualified
debt obligations and the entry into repurchase agreements referred to above
and in the Fund's Prospectus.
7. Invest more than 15% of its assets in the obligations of any one
bank, or invest more than 5% of its assets in the obligations of any other
issuer, except that up to 25% of the value of the Fund's total assets may
be invested, and securities issued or guaranteed by the U.S. Government or
its agencies or instrumentalities may be purchased, without regard to any
such limitations. Notwithstanding the foregoing, to the extent required by
the rules of the Securities and Exchange Commission, the Fund will not
invest more than 5% of its assets in the obligations of any one bank,
except that up to 25% of the value of the Fund's total assets may be
invested without regard to such limitation.
8. Invest more than 25% of its total assets in the securities of
issuers in any single industry; provided that there shall be no such
limitation on the purchase of Municipal Obligations and, for temporary
defensive purposes, securities issued by banks and obligations issued or
guaranteed by the U.S. Government, its agencies or instrumentalities.
9. Purchase more than 10% of the voting securities of any issuer
(this restriction applies only with respect to 75% of the Fund's assets) or
invest in companies for the purpose of exercising control.
10. Invest in securities of other investment companies, except as
they may be acquired as part of a merger, consolidation or acquisition of
assets.
11. Pledge, hypothecate, mortgage or otherwise encumber its assets,
except to the extent necessary to secure permitted borrowings.
12. Enter into repurchase agreements providing for settlement in more
than seven days after notice or purchase securities which are illiquid, if,
in the aggregate, more than 10% of the value of the Fund's net assets would
be so invested.
Notwithstanding Investment Restriction Nos. 1, 5 and 11, the Fund
reserves the right to enter into interest rate futures contracts, and
municipal bond index futures contracts, and any options that may be offered
in respect thereof, subject to the restrictions then in effect of the
Securities and Exchange Commission and the Commodity Futures Trading
Commission and to the receipt or taking, as the case may be, of appropriate
consents, approvals and other actions from or by those regulatory bodies.
In any event, no such contracts or options will be entered into until a
general description of the terms thereof are set forth in a subsequent
prospectus and statement of additional information, the Registration
Statement with respect to which has been filed with the Securities and
Exchange Commission and has become effective.
For purposes of Investment Restriction No. 8, industrial development
bonds, where the payment of principal and interest is the ultimate
responsibility of companies within the same industry, are grouped together
as an "industry." If a percentage restriction is adhered to at the time of
investment, a later increase or decrease in percentage resulting from a
change in values or assets will not constitute a violation of such
restriction.
The Fund may make commitments more restrictive than the restrictions
listed above so as to permit the sale of Fund shares in certain states.
Should the Fund determine that a commitment is no longer in the best
interest of the Fund and its shareholders, the Fund reserves the right to
revoke the commitment by terminating the sale of Fund shares in the state
involved.
MANAGEMENT OF THE FUND
Board members and officers of the Fund, together with information as
to their principal business occupations during at least the last five
years, are shown below. The Board member who is deemed to be an
"interested person" of the Fund, as defined in the 1940 Act, is indicated
by an asterisk.
Board Members of the Fund
*DAVID W. BURKE, Board Member. Chairman of the Broadcasting Board of
Governors, an independent board within the United States Information
Agency, since August 1995. From August 1994 to February 1995, Mr.
Burke was a consultant to the Manager and, from October 1990 to August
1994, he was Vice President and Chief Administrative Officer of the
Manager. From 1977 to 1990, Mr. Burke was involved in the management
of national television news, as Vice President and Executive Vice
President of ABC News, and subsequently as President of CBS News. Mr.
Burke is 59 years old and his address is P.O. Box 654, Eastham,
Massachusetts 02642.
ISABEL P. DUNST, Board Member. Partner in the law firm of Hogan &
Hartson since 1990. From 1986 to 1990, she was Deputy General Counsel
of the United States Department of Health and Human Services. Until
May 1996, she was also a Trustee of the Clients' Security Fund of the
District of Columbia Bar and President of Temple Sinai. Ms. Dunst is
48 years old and her address is c/o Hogan & Hartson, Columbia Square,
555 Thirteenth Street, N.W., Washington,D.C. 20004-1109.
LYLE E. GRAMLEY, Board Member. Consulting economist, since June 1992, and
Senior Staff Vice President and Chief Economist of Mortgage Bankers
Association of America, from 1985 to May 1992. He is also a director
of CWM Mortgage Holding, Inc. From 1980 to 1985, he was a member of
the Board of Governors of the Federal Reserve System. Mr. Gramley is
69 years old and his address is 12901 Three Sisters Road, Potomac,
Maryland 20854.
WARREN B. RUDMAN, Board Member. Since January 1993, Partner in the law firm
Paul, Weiss, Rifkind, Wharton & Garrison. From January 1981 to
January 1993, Mr. Rudman served as a United States Senator from the
State of New Hampshire. Since May 1995, Mr. Rudman has served as a
director of Collins & Aikman Corporation. Since January 1993, Mr.
Rudman has served as a director of Chubb Corporation and the Raytheon
Corporation. Since 1988, Mr. Rudman has served as a trustee of Boston
College and since 1986 as a member of the Senior Advisory Board of the
Institute of Politics of the Kennedy School of Government at Harvard
University. Mr. Rudman also served as Deputy Chairman of the
President's Foreign Intelligence Advisory Board. From January 1993 to
December 1994, Mr. Rudman had served as Vice Chairman of the Federal
Reserve Bank of Boston. Mr. Rudman is 65 years old and his address is
1615 L Street, N.W., Suite 1300, Washington D.C. 20036.
No shareholder meetings will be held for the purpose of electing Board
members unless and until such time as less than a majority of the Board
members holding office have been elected by shareholders, at which time the
Board members then in office will call a shareholders' meeting for the
election of Board members. Under the 1940 Act, shareholders of record of
not less than two-thirds of the outstanding shares of the Fund may remove a
Board member through a declaration in writing or by vote cast in person or
by proxy at a meeting called for that purpose. Board members are required
to call a meeting of shareholders for the purpose of voting upon the
question of removal of any such Board member when requested in writing to
do so by the shareholders of record of not less than 10% of the Fund's
outstanding shares.
For so long as the Fund's plans described in the sections captioned
"Service Plan" and "Shareholder Services Plan" remain in effect, the Board
members of the Fund who are not "interested persons" of the Fund, as
defined in the 1940 Act, will be selected and nominated by the Board
members who are not "interested persons" of the Fund.
Board members are entitled to receive an annual retainer and a per
meeting fee and reimbursement for their expenses. Emeritus Board members
are entitled to receive an annual retainer and per meeting fee of one-half
the amount paid to them as Board members. The aggregate amount of
compensation payable to each Board member by the Fund for the fiscal year
ended January 31, 1996, and by all other funds in the Dreyfus Family of
Funds for which such person is a Board member (the number of which is set
forth in parenthesis next to each Board member's total compensation) for
the year ended December 31, 1995, were as follows:
Total Compensation
Aggregate from Fund and
Name of Board Compensation from Fund Complex paid
Member Fund(*)(+) to Board Member
_________________ ________________ _________________
David W. Burke $5,500 $253,654 (52)
Isabel P. Dunst $5,500 $46,500 (7)
Lyle E. Gramley $5,500 $46,500 (7)
Warren B. Rudman $5,500 $85,500 (17)
____________________________
(*) Amount does not include reimbursed expenses for attending Board
meetings, which amounted to $533.44 for all Board members as a group.
(+) The aggregate compensation payable to each Board member by the Fund
was paid by the Manager and not the Fund.
Officers of the Fund
MARIE E. CONNOLLY, President and Treasurer. President and Chief Executive
Officer and a director of the Distributor and an officer of other
investment companies advised or administered by the Manager. From
December 1991 to July 1994, she was President and Chief Compliance
Officer of Funds Distributor, Inc., the ultimate parent of which is
Boston Institutional Group, Inc. Prior to December 1991, she served
as Vice President and Controller, and later as Senior Vice President,
of The Boston Company Advisors, Inc. She is 38 years old.
JOHN E. PELLETIER, Vice President and Secretary. Senior Vice President and
General Counsel of the Distributor and an officer of other investment
companies advised or administered by the Manager. From February 1992
to July 1994, he served as Counsel for The Boston Company Advisors,
Inc. From August 1990 to February 1992, he was employed as an
Associate at Ropes & Gray. He is 31 years old.
FREDERICK C. DEY, Vice President and Assistant Treasurer. Senior Vice
President of the Distributor and an officer of other investment
companies advised or administered by the Manager. From 1988 to August
1994, he was manager of the High Performance Fabric Division of
Springs Industries Inc. He is 34 years old.
ERIC B. FISCHMAN, Vice President and Assistant Secretary. Associate
General Counsel of the Distributor and an officer of other investment
companies advised or administered by the Manager. From September 1992
to August 1994, he was an attorney with the Board of Governors of the
Federal Reserve System. He is 31 years old.
ELIZABETH BACHMAN, Vice President and Assistant Secretary. Assistant Vice
President of the Distributor and an officer of other investment
companies advised or administered by the Manager. She is 26 years
old.
JOSEPH F. TOWER, III, Assistant Treasurer. Treasurer and Chief Financial
Officer of the Distributor and an officer of other investment
companies advised or administered by the Manager. From July 1988 to
August 1994, he was employed by The Boston Company, Inc. where he held
various management positions in the Corporate Finance and Treasury
areas. He is 33 years old.
JOHN J. PYBURN, Assistant Treasurer. Assistant Treasurer of the
Distributor and an officer of other investment companies advised or
administered by Manager. From 1984 to July 1994, he was an Assistant
Vice President in the Mutual Fund Accounting Department of the
Manager. He is 60 years old.
MARGARET PARDO, Assistant Secretary. Legal Assistant with the Distributor
and an officer of other investment companies advised or administered
by the Manager. From June 1992 to April 1995, she was a Medical
Coordination Officer at ORBIS International. Prior to June 1992, she
worked as a Program Coordinator at Physicians World Communications
Group. She is 27 years old.
The address of each officer of the Fund is 200 Park Avenue, New York,
New York 10166.
Board members and officers of the Fund, as a group, owned less than 1%
of the Fund's shares outstanding on May 3, 1996.
The following shareholders are known by the Fund to own of record 5%
or more of the Fund's Class A shares of beneficial interest outstanding on
May 3, 1996: (1) Central Fidelity Bank, Attn: TR Securities Operations,
Variable Note Desk, 1021 East Cary Street, Richmond, VA 23219-4000
(12.15%); and (2) First Interstate Bank of California, 26610 Agoura Road,
Calabasas, CA 91320-1954 (8.67%). The following shareholders are known by
the Fund to own of record 5% or more of the Fund's Class B shares of
beneficial interest outstanding on May 3, 1996: (1) Cudd & Company, Chase
Manhattan Bank, 1211 Avenue of the Americas, Floor 35, New York, NY 10036-
8701 (38.98%); (2) Bost & Co., 3 Mellon Bank Center, Pittsburgh, PA 15259
(18.13%); (3) Saturn & Co, c/o Investors Bank & Trust Inc., Collections
Securities Operations, 89 South Street, 6th floor, Boston, MA 02111-2679
(10.64%); (4) National Bank of Indianapolis, Money Management Department,
107 North Pennsylvania Street, Suite 700, Indianapolis, IN 46204-2423
(10.25%); and (5) Mellon Bank, Three Mellon Bank Center, Room 153-2502,
Pittsburgh, PA 15259 (5.17%).
A shareholder who beneficially owns, directly or indirectly, more than
25% of the Fund's voting securities may be deemed a "control person" (as
defined in the 1940 Act) of the Fund.
MANAGEMENT AGREEMENT
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "Management
of the Fund."
The Manager provides management services pursuant to the Management
Agreement (the "Agreement") dated August 24, 1994 with the Fund, which is
subject to annual approval by (i) the Fund's Board or (ii) vote of a
majority (as defined in the 1940 Act) of the outstanding voting securities
of the Fund, provided that in either event the continuance also is approved
by a majority of the Board members who are not "interested persons" (as
defined in the 1940 Act) of the Fund or the Manager, by vote cast in person
at a meeting called for the purpose of voting on such approval.
Shareholders approved the Agreement on August 5, 1994 and the Fund's Board,
including a majority of the Board members who are not "interested persons"
of any party to the Agreement, last voted to renew the Agreement at a
meeting held on May 22, 1996. The Agreement is terminable without penalty,
on 60 days' notice, by the Fund's Board or by vote of the holders of a
majority of the Fund's outstanding voting shares, or, on not less than 90
days' notice, by the Manager. The Agreement will terminate automatically
in the event of its assignment (as defined in the 1940 Act).
The following persons are officers and/or directors of the Manager:
Howard Stein, Chairman of the Board and Chief Executive Officer; W. Keith
Smith, a Vice Chairman of the Board; Christopher M. Condron, President,
Chief Operating Officer and a director; Stephen E. Canter, Vice Chairman,
Chief Investment Officer and a director; Lawrence S. Kash, Vice Chairman-
Distribution and a director; Philip L. Toia, Vice Chairman-Operations and
Administration and a director; William T. Sandalls, Jr., Senior Vice
President and Chief Financial Officer; Barbara Casey, Vice President-
Dreyfus Retirement Services; Elie M. Genadry, Vice President-Institutional
Sales; William F. Glavin, Jr., Vice President-Corporate Development; Mark
N. Jacobs, Vice President, General Counsel and Secretary; Patrice M.
Kozlowski, Vice President-Corporate Communications; Mary Beth Leibig, Vice
President-Human Resources; Jeffrey N. Nachman, Vice President-Mutual Fund
Accounting; Andrew S. Wasser, Vice President-Information Systems; Maurice
Bendrihem, Controller; Elvira Oslapas, Assistant Secretary; and Mandell L.
Berman, Frank V. Cahouet, Alvin E. Friedman, Lawrence M. Greene and Julian
M. Smerling, directors.
The Manager manages the Fund's portfolio of investments in accordance
with the stated policies of the Fund, subject to the approval of the Fund's
Board. The Manager is responsible for investment decisions, and provides
the Fund with portfolio managers who are authorized by the Board to execute
purchases and sales of securities. The Fund's portfolio managers are
Joseph P. Darcy, A. Paul Disdier, Douglas J. Gaylor, Karen M. Hand, Stephen
C. Kris, Richard J. Moynihan, Jill C. Shaffro, L. Lawrence Troutman, Samuel
J. Weinstock and Monica S. Wieboldt. The Manager also maintains a research
department with a professional staff of portfolio managers securities
analysts who provide research services for the Fund as well as for other
funds advised by the Manager. All purchases and sales are reported for the
Board members review at the meeting subsequent to such transactions.
The Manager maintains office facilities on behalf of the Fund, and
furnishes statistical and research data, clerical help, accounting, data
processing, bookkeeping and internal auditing and certain other required
services to the Fund. The Manager also may make such advertising and
promotional expenditures, using its own resources, as it from time to time
deems appropriate.
As compensation for its services, the Fund has agreed to pay the
Manager a monthly management fee at the annual rate of .20 of 1% of the
value of the Fund's average daily net assets, as provided in the Agreement.
All fees and expenses are accrued daily and deducted before declaration of
dividends to investors. The management fees payable by the Fund for the
fiscal years ended January 31, 1994, 1995 and 1996 amounted to $3,663,999,
$2,972,503 and $2,960,202, respectively. The amount payable in fiscal 1994
was reduced pursuant to an undertaking by the Manager, resulting in a net
management fee paid of $2,978,463 for fiscal 1994.
Unless the Manager gives the Fund's investors at least 90 days' notice
to the contrary, the Manager, and not the Fund, will be liable for those
expenses of the Fund (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 Fund expenses: (i) the management fee payable by the Fund
monthly at the annual rate of .20 of 1% of the value of the Fund's average
daily net assets and (ii) as to Class B shares only, payments made at the
annual rate of .25 of 1% of the value of the average daily net assets of
Class B, pursuant to the Fund's Service Plan. See "Service Plan."
In addition, the Agreement provides that if in any fiscal year the ag-
gregate expenses of the Fund, exclusive of taxes, brokerage, interest on
borrowings and (with the prior written consent of the necessary state
securities commissions) extraordinary expenses, but including the
management fee, exceed 1-1/2% of the value of the Fund's average net assets
for the fiscal year, the Fund may deduct from the payment to be made to the
Manager under the Agreement, or the Manager will bear, such excess expense.
Such deduction or payment, if any, will be estimated on a daily basis, and
reconciled and effected or paid, as the case may be, on a monthly basis.
The aggregate of the fees payable to the Manager is not subject to
reduction as the value of the Fund's net assets increases.
PURCHASE OF SHARES
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "How to Buy
Shares."
The Distributor. The Distributor serves as the Fund's distributor on
a best efforts basis pursuant to an agreement which is renewable annually.
The Distributor also acts as distributor for the other funds in the Dreyfus
Family of Funds and for certain other investment companies. In some
states, banks or other financial institutions effecting transactions in
Fund shares may be required to register as dealers pursuant to state law.
Using Federal Funds. Dreyfus Transfer, Inc., the Fund's transfer and
dividend disbursing agent (the "Transfer Agent"), or the Fund may attempt
to notify the investor upon receipt of checks drawn on banks that are not
members of the Federal Reserve System as to the possible delay in
conversion into Federal Funds and may attempt to arrange for a better means
of transmitting the money. If the investor is a customer of a securities
dealer, bank or other financial institution and his order to purchase Fund
shares is paid for other than in Federal Funds, the securities dealer, bank
or other financial institution, acting on behalf of its customer, will
complete the conversion into, or itself advance, Federal Funds generally on
the business day following receipt of the customer order. The order is
effective only when so converted and received by the Transfer Agent. An
order for the purchase of Fund shares placed by an investor with a
sufficient Federal Funds or cash balance in his brokerage account with a
securities dealer, bank or other financial institution will become
effective on the day that the order, including Federal Funds, is received
by the Custodian.
SERVICE PLAN
(CLASS B ONLY)
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "Service
Plan."
Rule 12b-1 (the "Rule") adopted by the Securities and Exchange
Commission under the 1940 Act provides, among other things, that an
investment company may bear expenses of distributing its shares only
pursuant to a plan adopted in accordance with the Rule. The Fund's Board
has adopted such a plan (the "Service Plan") with respect to the Fund's
Class B shares, pursuant to which the Fund reimburses the Distributor for
distributing Class B shares and pays the Manager, Dreyfus Service
Corporation, a wholly-owned subsidiary of the Manager, and any affiliate of
either of them (collectively, "Dreyfus") for advertising and marketing
Class B shares and for the provision of certain services to the holders of
Class B shares. Under the Service Plan, the Distributor and Dreyfus may
make payments to certain financial institutions, securities dealers and
other financial industry professionals (collectively, "Service Agents") in
respect to these services. The Fund's Board believes that there is a
reasonable likelihood that the Service Plan will benefit the Fund and the
holders of Class B shares.
A quarterly report of the amounts expended under the Service Plan, and
the purposes for which such expenditures were incurred, must be made to the
Board for its review. In addition, the Service Plan provides that it may
not be amended to increase materially the costs which holders of Class B
shares may bear pursuant to the Service Plan without the approval of the
holders of Class B shares and that other material amendments of the Service
Plan must be approved by the Fund's Board and by the Board members who are
not "interested persons" (as defined in the 1940 Act) of the Fund and have
no direct or indirect financial interest in the operation of the Service
Plan or in any agreements entered into in connection with the Service Plan,
by vote cast in person at a meeting called for the purpose of considering
such amendments. The Service Plan is subject to annual approval by such
vote of the Board members cast in person at a meeting called for the
purpose of voting on the Service Plan. The Service Plan was last so
approved by the Board members at a meeting held on May 22, 1996. The
Service Plan may be terminated at any time by vote of a majority of the
Board members who are not "interested persons" and have no direct or
indirect financial interest in the operation of the Service Plan or in any
agreements entered into in connection with the Service Plan or by vote of
the holders of a majority of Class B shares.
For fiscal year ended January 31, 1996, the Fund paid $151,174
pursuant to the Service Plan, of which $150,238 was paid to the Distributor
as reimbursement for distributing Class B shares, and $936 was paid to
Dreyfus for advertising and marketing Class B shares and for providing
services to Class B shareholders.
SHAREHOLDER SERVICES PLAN
(CLASS A ONLY)
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "Shareholder
Services Plan."
The Fund has adopted a Shareholder Services Plan (the "Plan") pursuant
to which the Fund has agreed to reimburse the Dreyfus Service Corporation
for certain allocated expenses of providing personal services and/or
maintaining shareholder accounts with respect to Class A shares only. The
services provided may include personal services relating to 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.
A quarterly report of the accounts expended under the Plan, and the
purposes for which such expenditures were incurred, must be made to the
Board for its review. In addition, the Plan provides that material
amendments of the Plan must be approved by the Fund's Board and by the
Board members who are not "interested persons" (as defined in the 1940 Act)
of the Fund or the Manager and have no direct or indirect financial
interest in the operation of the Plan, by vote cast in person at a meeting
called for the purpose of considering such amendments. The Plan is subject
to annual approval by such vote of the Board members cast in person at a
meeting called for the purpose of voting on the Plan. The Plan was last so
approved at a meeting held on May 22, 1996. The Plan is terminable at any
time by vote of a majority of the Board members who are not "interested
persons" and have no direct or indirect financial interest in the operation
of the Plan.
For the fiscal year ended January 31, 1996, no amounts were paid by
the Fund, with respect to Class A shares, under the Plan. See "Management
Agreement."
REDEMPTION OF SHARES
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "How to
Redeem Shares."
Redemption by Wire or Telephone. By using this procedure, the
investor authorizes the Transfer Agent, to act on wire or telephone
redemption instructions from any person representing himself or herself to
be an authorized representative of the investor, and reasonably believed by
the Transfer Agent to be genuine. Ordinarily, the Fund will initiate
payment for shares redeemed pursuant to this procedure on the same business
day if Dreyfus Institutional Services Division receives the redemption
request in proper form prior to 12:00 Noon, New York time, on such day;
otherwise the Fund will initiate payment on the next business day. Such
payment will be made to a bank that is a member of the Federal Reserve
System.
Investors with access to telegraphic equipment may wire redemption
requests to the Transfer Agent by employing the following transmittal code
which may be used for domestic or overseas transmissions:
Transfer Agent's
Transmittal Code Answer Back Sign
144295 144295 TSSG PREP
Investors who do not have direct access to telegraphic equipment may
have the wire transmitted by contacting a TRT Cables operator at
1-800-654-7171, toll free. Investors should advise the operator that the
above transmittal code must be used and should also inform the operator of
the Transfer Agent's answer back sign.
Redemption Commitment. The Fund has committed itself to pay in cash
all redemption requests by any shareholder of record, limited in amount
during any 90-day period to the lesser of $250,000 or 1% of the value of
the Fund's net assets at the beginning of such period. Such commitment is
irrevocable without the prior approval of the Securities and Exchange
Commission. In the case of requests for redemption in excess of such
amount, the Fund's Board reserves the right to make payments in whole or in
part in securities (which may include non-marketable securities) or other
assets of the Fund in case of an emergency or any time a cash distribution
would impair the liquidity of the Fund to the detriment of the existing
shareholders. In such event, the securities would be valued in the same
manner as the Fund's portfolio is valued. If the recipient sold such
securities, brokerage charges would be incurred.
Suspension of Redemptions. The right of redemption may be suspended
or the date of payment postponed (a) during any period when the New York
Stock Exchange is closed (other than customary weekend and holiday
closings), (b) when trading in the markets the Fund ordinarily utilizes is
restricted, or when an emergency exists as determined by the Securities and
Exchange Commission so that disposal of the Fund's investments or
determination of its net asset value is not reasonably practicable, or (c)
for such other periods as the Securities and Exchange Commission by order
may permit to protect the Fund's shareholders.
DETERMINATION OF NET ASSET VALUE
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "How to Buy
Shares."
Amortized Cost Pricing. The valuation of the Fund's portfolio
securities is based upon their amortized cost which does not take into
account unrealized capital gains or losses. This involves valuing an
instrument at its cost and thereafter assuming a constant amortization to
maturity of any discount or premium, regardless of the impact of
fluctuating interest rates on the market value of the instrument. While
this method provides certainty in valuation, it may result in periods
during which value, as determined by amortized cost, is higher or lower
than the price the Fund would receive if it sold the instrument.
The Fund's Board has established, as a particular responsibility
within the overall duty of care owed to the Fund's investors, procedures
reasonably designed to stabilize the Fund's price per share as computed for
the purpose of purchases and redemptions at $1.00. Such procedures include
review of the Fund's portfolio holdings by the Fund's Board, at such
intervals as it deems appropriate, to determine whether the Fund's net
asset value calculated by using available market quotations or market
equivalents deviates from $1.00 per share based on amortized cost. Market
quotations and market equivalents used in such review are obtained from an
independent pricing service (the "Service") approved by the Board of
Trustees. The Service will value the Fund's investments based on methods
which include consideration of: yields or prices of municipal obligations
of comparable quality, coupon, maturity and type; indications of values
from dealers; and general market conditions. The Service also may employ
electronic data processing techniques and/or a matrix system to determine
valuations.
The extent of any deviation between the Fund's net asset value based
upon available market quotations or market equivalents and $1.00 per share
based on amortized cost will be examined by the Fund's Board. If such
deviation exceeds 1/2 of 1%, the Fund's Board will consider promptly what
action, if any, will be initiated. In the event the Fund's Board
determines that a deviation exists which may result in material dilution or
other unfair results to investors or existing shareholders, it has agreed
to take such corrective action as it regards as necessary and appropriate
including: selling portfolio instruments prior to maturity to realize
capital gains or losses or to shorten average portfolio maturity;
withholding dividends or paying distributions from capital or capital
gains; redeeming shares in kind; or establishing a net asset value per
share by using available market quotations or market equivalents.
New York Stock Exchange Closings. The holidays (as observed) on which
the New York Stock Exchange is closed currently are: New Year's Day,
Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor Day,
Thanksgiving and Christmas.
INVESTOR SERVICES
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "Investor
Services."
Fund Exchanges. By using the Telephone Exchange Privilege, the
investor authorizes the Transfer Agent to act on exchange instructions from
any person representing himself or herself to be an authorized
representative of the investor and reasonably believed by the Transfer
Agent to be genuine. Telephone exchanges may be subject to limitations as
to the amount involved or the number of telephone exchanges permitted.
Shares will be exchanged at the net asset value next determined after
receipt of an exchange request in proper form. Shares in certificate form
are not eligible for telephone exchange.
Dreyfus Auto-Exchange Privilege. Dreyfus Auto-Exchange Privilege
permits an investor to purchase, in exchange for shares of the Fund, shares
of Dreyfus Cash Management, Dreyfus Cash Management Plus, Inc., Dreyfus
Institutional Short Term Treasury Fund, Dreyfus Government Cash Management,
Dreyfus Municipal Cash Management Plus, Dreyfus New York Municipal Cash
Management, Dreyfus Treasury Cash Management or Dreyfus Treasury Prime Cash
Management. This Privilege is available only for existing accounts.
Shares will be exchanged on the basis of relative net asset value.
Enrollment in or modification or cancellation of this Privilege is
effective three business days following notification by the investor. An
investor will be notified if its account falls below the amount designated
under this Privilege. In this case, an investor's account will fall to
zero unless additional investments are made in excess of the designated
amount prior to the next Auto-Exchange transaction. Shares in certificate
form are not eligible for this Privilege.
Fund Exchanges and the Dreyfus Auto-Exchange Privilege are available
to investors resident in any state in which shares of the fund being
acquired may legally be sold. Shares may be exchanged only between
accounts having identical names and other identifying designations.
The Fund reserves the right to reject any exchange request in whole or
in part. The availability of Fund Exchanges or the Dreyfus Auto-Exchange
Privilege may be modified or terminated at any time upon notice to
investors.
DIVIDENDS, DISTRIBUTION AND TAXES
The following information supplements and should be read in
conjunction with the section in Fund's Prospectus entitled "Dividends,
Distributions and Taxes."
Ordinarily, gains and losses realized from portfolio transactions will
be treated as capital gain or loss. However, all or a portion of the any
gains realized from the sale or other disposition of certain market
discount bonds will be treated as ordinary income under Section 1276 of the
Internal Revenue Code of 1986, as amended.
PORTFOLIO TRANSACTIONS
Portfolio securities ordinarily are purchased from and sold to parties
acting as either principal or agent. Newly-issued securities ordinarily
are purchased directly from the issuer or from an underwriter; other
purchases and sales usually are placed with those dealers from which it
appears that the best price or execution will be obtained. Usually no
brokerage commissions, as such, are paid by the Fund for such purchases and
sales, although the price paid usually includes an undisclosed compensation
to the dealer acting as agent. The prices paid to underwriters of
newly-issued securities usually include a concession paid by the issuer to
the underwriter, and purchases of after-market securities from dealers
ordinarily are executed at a price between the bid and asked price. No
brokerage commissions have been paid by the Fund to date.
Transactions are allocated to various dealers by the Fund's portfolio
managers in their best judgment. The primary consideration is prompt and
effective execution of orders at the most favorable price. Subject to that
primary consideration, dealers may be selected for research, statistical or
other services to enable the Manager to supplement its own research and
analysis with the views and information of other securities firms and may
be selected based upon their sales of Fund shares.
Research services furnished by brokers through which the Fund effects
securities transactions may be used by the Manager in advising other funds
it advises and, conversely, research services furnished to the Manager by
brokers in connection with other funds the Manager advises may be used by
the Manager in advising the Fund. Although it is not possible to place a
dollar value on these services, it is the opinion of the Manager that the
receipt and study of such services should not reduce the overall expenses
of its research department.
YIELD INFORMATION
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "Yield
Information."
For the seven-day period ended January 31, 1996, yield and effective
yield of Class A shares were 3.25% and 3.30%, respectively, and of Class B
share were 3.00% and 3.04%, respectively. Yield is computed in accordance
with a standardized method which involves determining the net change in the
value of a hypothetical pre-existing Fund account having a balance of one
share at the beginning of a seven calendar day period for which yield is to
be quoted, dividing the net change by the value of the account at the
beginning of the period to obtain the base period return, and annualizing
the results (i.e., multiplying the base period return by 365/7). The net
change in the value of the account reflects the value of additional shares
purchased with dividends declared on the original share and any such
additional shares and fees that may be charged to the shareholder's
account, in proportion to the length of the base period and the Fund's
average account size, but does not include realized gains and losses or
unrealized appreciation and depreciation. Effective yield is computed by
adding 1 to the base period return (calculated as described above), raising
that sum to a power equal to 365 divided by 7, and subtracting 1 from the
result.
Based upon a 1996 Federal tax rate of 39.6%, the Fund's tax equivalent
yield for the seven-day period ended January 31, 1996 was 5.38% and 4.97%
for Class A and Class B shares, respectively. Tax equivalent yield is
computed by dividing that portion of the yield or effective yield
(calculated as described above) which is tax exempt by 1 minus a stated tax
rate and adding the quotient to that portion, if any, of the yield of the
Fund that is not tax exempt.
The tax equivalent yield noted above represents the application of the
highest Federal marginal personal income tax rate presently in effect. The
tax equivalent figure, however, does not include the potential effect of
any state or local (including, but not limited to, county, district or
city) taxes, including applicable surcharges. In addition, there may be
pending legislation which could affect such stated tax rates or yields.
Each investor should consult its tax adviser, and consider its own factual
circumstances and applicable tax laws, in order to ascertain the relevant
tax equivalent yield.
Yields will fluctuate and are not necessarily representative of future
results. Each investor should remember that yield is a function of the
type and quality of the instruments in the portfolio, portfolio maturity
and operating expenses. An investor's principal in the Fund is not
guaranteed. See "Determination of Net Asset Value" for a discussion of the
manner in which the Fund's price per share is determined.
From time to time, the Fund may use hypothetical tax equivalent yields
or charts in its advertising. These hypothetical yields or charts will be
used for illustrative purposes only and are not indicative of the Fund's
past or future performance.
From time to time, advertising materials for the Fund may refer to or
discuss then-current or past economic conditions, developments and/or
events, or actual or proposed tax legislation. From time to time,
advertising materials for the Fund may also refer to statistical or other
information concerning trends relating to investment companies, as compiled
by industry associations such as the Investment Company Institute.
INFORMATION ABOUT THE FUND
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "General
Information."
Each Fund share has one vote and, when issued and paid for in
accordance with the terms of the offering, is fully paid and nonassessable.
Fund shares have no preemptive, subscription or conversion rights and are
freely transferable.
The Fund sends annual and semi-annual financial statements to all its
shareholders.
In early 1974, the Manager commenced offering the first money market
fund to be widely offered on a retail basis, Dreyfus Liquid Assets, Inc.
Money market mutual funds have subsequently grown into a multibillion
dollar industry.
The Fund is a member of the Family of Dreyfus Cash Management Funds
which are designed to meet the needs of an array of institutional
investors. As of May 8, 1996, the total net assets of the Dreyfus Cash
Management Funds amounted to approximately $21.5 billion.
TRANSFER AND DIVIDEND DISBURSING AGENT, CUSTODIAN, COUNSEL
AND INDEPENDENT AUDITORS
Dreyfus Transfer, Inc., a wholly-owned subsidiary of the Manager, P.O.
Box 9671, Providence, Rhode Island 02940-9671, is the Fund's transfer and
dividend disbursing agent. Under a transfer agency agreement with the
Fund, the Transfer Agent arranges for the maintenance of shareholder
account records for the Fund, the handling of certain communications
between shareholders and the Fund and the payment of dividends and
distributions payable by the Fund. For these services, the Transfer Agent
receives a monthly fee computed on the basis of the number of shareholder
accounts it maintains for the Fund during the month, and is reimbursed for
certain out-of-pocket expenses. For the period December 1, 1995 (effective
date of transfer agency agreement) through January 31, 1996, the Fund paid
the Transfer Agent $5,019.
The Bank of New York, 90 Washington Street, New York, New York 10286,
is the Fund's custodian.
Neither Dreyfus Transfer, Inc. nor The Bank of New York has any part
in determining the investment policies of the Fund or which securities are
to be purchased or sold by the Fund.
Stroock & Stroock & Lavan, 7 Hanover Square, New York, New York
10004-2696, as counsel for the Fund, has rendered its opinion as to certain
legal matters regarding the due authorization and valid issuance of the
shares being sold pursuant to the Fund's Prospectus.
Ernst & Young LLP, 787 Seventh Avenue, New York, New York 10019,
independent auditors, have been selected as auditors of the Fund.
APPENDIX
Description of S&P's, Moody's and Fitch ratings:
S&P
Municipal Bond Ratings
An S&P municipal bond rating is a current assessment of the
creditworthiness of an obligor with respect to a specific obligation.
The ratings are based on current information furnished by the issuer
or obtained by S&P from other sources it considers reliable, and will
include: (1) likelihood of default-capacity and willingness of the obligor
as to the timely payment of interest and repayment of principal in
accordance with the terms of the obligation; (2) nature and provisions of
the obligation; and (3) protection afforded by, and relative position of,
the obligation in the event of bankruptcy, reorganization or other
arrangement under the laws of bankruptcy and other laws affecting
creditors' rights.
AAA
Debt rated AAA has the highest rating assigned by S&P. Capacity to
pay interest and repay principal is extremely strong.
AA
Debt rated AA has a very strong capacity to pay interest and repay
principal and differs from the highest rated issues only in a small degree.
The AA rating may be modified by the addition of a plus (+) or minus (-)
sign designation to show relative standing within the category.
Municipal Note Ratings
SP-1
The issuers of these municipal notes exhibit very strong or strong
capacity to pay principal and interest. Those issues determined to possess
overwhelming safety characteristics are given a plus (+) sign designation.
Commercial Paper Ratings
The rating A is the highest rating and is assigned by S&P to issues
that are regarded as having the greatest capacity for payment. Issues in
this category are delineated with the numbers 1, 2 and 3 to indicate the
relative degree of safety. Paper rated A-1 indicates that the degree of
safety regarding timely payment is either overwhelming or very strong.
Those issues determined to possess overwhelming safety characteristics are
denoted with a plus (+) sign designation.
Moody's
Municipal Bond Ratings
Aaa
Bonds which are rated Aaa are judged to be of the best quality. They
carry the smallest degree of investment risk and are generally referred to
as "gilt edge." Interest payments are protected by a large or by an
exceptionally stable margin and principal is secure. While the various
protective elements are likely to change, such changes as can be visualized
are most unlikely to impair the fundamentally strong position of such
issues.
Aa
Bonds which are rated Aa are judged to be of high quality by all
standards. Together with the Aaa group they comprise what generally are
known as high-grade bonds. They are rated lower than the best bonds
because margins of protection may not be as large as in Aaa securities or
fluctuation of protective elements may be of greater amplitude or there may
be other elements present which make the long-term risks appear somewhat
larger than in Aaa securities. Moody's applies the numerical modifiers 1,
2 and 3 to show relative standing within the major rating categories,
except in the Aaa category. The modifier 1 indicates a ranking for the
security in the higher end of a rating category; the modifier 2 indicates a
mid-range ranking; and the modifier 3 indicates a ranking in the lower end
of a rating category.
Municipal Note Ratings
Moody's ratings for state and municipal notes and other short-term
loans are designated Moody's Investment Grade (MIG). Such ratings
recognize the difference between short-term credit risk and long-term risk.
Factors affecting the liquidity of the borrower and short-term cyclical
elements are critical in short-term ratings, while other factors of major
importance in bond risk, long-term secular trends for example, may be less
important over the short run.
A short-term rating may also be assigned on an issue having a demand
feature. Such ratings will be designated as VMIG or, if the demand feature
is not rated, as NR. Short-term ratings on issues with demand features are
differentiated by the use of the VMIG symbol to reflect such
characteristics as payment upon periodic demand rather than fixed maturity
dates and payment relying on external liquidity. Additionally, investors
should be alert to the fact that the source of payment may be limited to
the external liquidity with no or limited legal recourse to the issuer in
the event the demand is not met.
Moody's short-term ratings are designated Moody's Investment Grade as
MIG 1 or VMIG 1 through MIG 4 or VMIG 4. As the name implies, when Moody's
assigns an MIG or VMIG rating, all categories define an investment grade
situation.
MIG 1/VMIG 1
This designation denotes best quality. There is present strong
protection by established cash flows, superior liquidity support or
demonstrated broad-based access to the market for refinancing.
MIG 2/VMIG 2
This designation denotes high quality. Margins of protection are
ample although not so large as in the preceding group.
Commercial Paper Ratings
The rating Prime-1 (P-1) is the highest commercial paper rating
assigned by Moody's. Issuers of P-1 paper must have a superior capacity
for repayment of short-term promissory obligations, and ordinarily will be
evidenced by leading market positions in well established industries, high
rates of return on funds employed, conservative capitalization structures
with moderate reliance on debt and ample asset protection, broad margins in
earnings coverage of fixed financial charges and high internal cash
generation, and well established access to a range of financial markets and
assured sources of alternate liquidity.
Issuers (or related supporting institutions) rated Prime-2 (P-2) have
a strong capacity for repayment of short-term promissory obligations.
Capitalization characteristics, while still appropriate, may be more
affected by external conditions. Ample alternate liquidity is maintained.
Fitch
Municipal Bond Ratings
The ratings represent Fitch's assessment of the issuer's ability to
meet the obligations of a specific debt issue or class of debt. The
ratings take into consideration special features of the issue, its
relationship to other obligations of the issuer, the current financial
condition and operative performance of the issuer and of any guarantor, as
well as the political and economic environment that might affect the
issuer's future financial strength and credit quality.
AAA
Bonds rated AAA are considered to be investment grade and of the
highest credit quality. The obligor has an exceptionally strong ability to
pay interest and repay principal, which is unlikely to be affected by
reasonably foreseeable events.
AA
Bonds rated AA are considered to be investment grade and of very high
credit quality. The obligor's ability to pay interest and repay principal
is very strong, although not quite as strong as bonds rated AAA. Because
bonds rated in the AAA and AA categories are not significantly vulnerable
to foreseeable future developments, short-term debt of these issuers is
generally rated F-1+.
Plus (+) and minus (-) signs are used with a rating symbol to indicate
the relative position of a credit within the rating category.
Short-Term Ratings
Fitch's short-term ratings apply to debt obligations that are payable
on demand or have original maturities of up to three years, including
commercial paper, certificates of deposit, medium-term notes, and municipal
and investment notes.
Although the credit analysis is similar to Fitch's bond rating
analysis, the short-term rating places greater emphasis than bond ratings
on the existence of liquidity necessary to meet the issuer's obligations in
a timely manner.
F-1+
Exceptionally Strong Credit Quality. Issues assigned this rating are
regarded as having the strongest degree of assurance for timely payment.
F-1
Very Strong Credit Quality. Issues carrying this rating reflect an
assurance of timely payment only slightly less in degree than issues rated
F-1+.
F-2
Good Credit Rating. Issues carrying this rating have a satisfactory
degree of assurance for timely payments, but the margin of safety is not as
great as the F-1+ and F-1 categories.
<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
Reference is made to pages 3 and 4 of the Fund's Prospectus dated
June 3, 1996.
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
Dreyfus Tax Exempt Cash Management
PART C. OTHER INFORMATION
_________________________
Item 24. Financial Statements and Exhibits. - List
_______ _________________________________________
(a) Financial Statements:
Included in Part A of the Registration Statement
Condensed Financial Information, with respect to Class A
shares, for each of the ten years in the period ended January
31, 1996, and, with respect to Class B shares, for the period
from January 10, 1994 (commencement of initial offering) to
January 31, 1994 and for each of the two years in the period
ended January 31, 1996.
Included in Part B of the Registration Statement:
Statement of Investments--January 31, 1996.
Statement of Assets and Liabilities--January 31, 1996.
Statement of Operations--year ended January 31, 1996.
Statement of Changes in Net Assets--for each of the
years ended January 31, 1995 and 1996.
Notes to Financial Statements.
Report of Ernst & Young LLP, Independent Auditors, dated
March 5, 1996.
All Schedules and other financial statement information, for which provision
is made in the applicable accounting regulations of the Securities and
Exchange Commission, are either omitted because they are not required under
the related instructions, they are inapplicable, or the required information
is presented in the financial statements or notes thereto which are included
in Part B of the Registration Statement.
Item 24. Financial Statements and Exhibits. - List (continued)
_______ _____________________________________________________
(b) Exhibits:
(1) Registrant's Amended and Restated Agreement and Declaration of
Trust is incorporated by reference to Exhibit (1)(b) of Post-
Effective Amendment No. 13 to the Registration Statement on Form
N-1A, filed on September 30, 1993.
(2) Registrant's By-Laws are incorporated by reference to Exhibit (2)
of Post-Effective Amendment No. 18 to the Registration Statement
on Form N-1A, filed on October 25, 1995.
(4) Specimen certificate for the Registrant's securities is
incorporated by reference to Exhibit (4) of Pre-Effective
Amendment No. 3 to the Registration Statement on Form N-1A, filed
on March 24, 1987.
(5) Management Agreement is incorporated by reference to Exhibit (5)
of Post-Effective No. 16 to the Registration Statement on Form
N-1A, filed on March 24, 1995.
(6) Distribution Agreement is incorporated by reference to Exhibit (6)
of Post-Effective No. 16 to the Registration Statement on Form
N-1A, filed on March 24, 1995.
(8)(a) Amended and Restated Custody Agreement is incorporated by
reference to Exhibit (8)(a) of Post-Effective Amendment No. 18 to
the Registration Statement on Form N-1A, filed on October 25,
1995.
(8)(b) Sub-Custodian Agreements is incorporated by reference to Exhibit
(8)(b) of Post-Effective Amendment No. 18 to the Registration
Statement on Form N-1A, filed on October 25, 1995.
(9) Shareholders Service Plan is incorporated by reference to Exhibit
(9) of Post-Effective No. 16 to the Registration Statement on Form
N-1A, filed on March 24, 1995.
(10) Opinion and consent of Registrant's counsel is incorporated by
reference to Exhibit (10) of Post-Effective Amendment No. 18 to
the Registration Statement on Form N-1A, filed on October 25,
1995.
(11) Consent of Independent Auditors.
(15) Service Plan is incorporated by reference to Exhibit (15) of Post-
Effective Amendment No. 16 to the Registration Statement on Form
N-1A, filed on March 24, 1995.
(16) Schedules of Computation of Performance Data are incorporated by
reference to Exhibit 16 of Post-Effective Amendment No. 14 to the
Registration Statement on Form N-1A, filed on May 27, 1994.
(18) Rule 18f-3 Plan is incorporated by reference to Exhibit (18) of
Post-Effective Amendment No. 18 to the Registration Statement on
Form N-1A, filed on October 25, 1995.
Item 24. Financial Statements and Exhibits. - List (continued)
_______ _____________________________________________________
Other Exhibits
______________
(a) Power of Attorney of Trustees are incorporated by
reference to Other Exhibit (a) of Post-Effective No. 16
to the Registration Statement on Form N-1A, filed on
March 24, 1995.
(b) Power of Attorney of Principal Executive, Financial and
Accounting Officer is incorporated by reference to Other
Exhibit (b) of Post-Effective No. 16 to the Registration
Statement on Form N-1A, filed on March 24, 1995.
(c) Certificate of Assistant Secretary is incorporated by
reference to Other Exhibit (c) of Post-Effective No. 16
to the Registration Statement on Form N-1A, filed on
March 24, 1995.
Item 25. Persons Controlled by or under Common Control with Registrant.
_______ ______________________________________________________________
Not Applicable
Item 26. Number of Holders of Securities.
_______ ________________________________
(1) (2)
Number of Record
Title of Class Holders as of May 3, 1996
______________ _____________________________
Shares of Beneficial Interest
(par value $.001)
Class A Shares. . . . . . . . . . . . . . . . 1,774
Class B Shares. . . . . . . . . . . . . . . . . .26
Item 27. Indemnification
_______ _______________
Reference is made to Article EIGHT of the Registrant's Amended and
Restated Agreement and Declaration of Trust previously filed as
Exhibit 1 to Post-Effective Amendment No. 13 to the Registration
Statement on Form N-1A on September 30, 1993. The application of
these provisions is limited by Article 10 of the Registrant's By-
Laws previously filed as Exhibit 2 to Post-Effective Amendment No.
18 to the Registration Statement on Form N-1A on October 25, 1995
and by the following undertaking set forth in the rules promulgated
by the Securities and Exchange Commission: Insofar as
indemnification for liabilities arising under the Securities Act of
1933 may be permitted to trustees, officers and controlling persons
of the registrant pursuant to the foregoing provisions, or
otherwise, the registrant has been advised that in the opinion of
the Securities
Item 27. Indemnification
_______ _______________
and Exchange Commission such indemnification is against public
policy as expressed in such Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such
liabilities (other than the payment by the registrant of expenses
incurred or paid by a trustee, officer or controlling person of the
registrant in the successful defense of any action, suit or
proceeding) is asserted by such trustee, officer or controlling
person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification
by it is against public policy as expressed in such Act and will be
governed by the final adjudication of such issue.
Reference is also made to the Distribution Agreement attached
hereto as Exhibit (6) of Post-Effective No. 16 to the Registration
Statement on Form N-1A, filed on March 24, 1995.
Item 28. Business and Other Connections of Investment Adviser.
_______ ____________________________________________________
The Dreyfus Corporation ("Dreyfus") and subsidiary companies
comprise a financial service organization whose business
consists primarily of providing investment management services
as the investment adviser, manager and distributor for sponsored
investment companies registered under the Investment Company Act
of 1940 and as an investment adviser to institutional and
individual accounts. Dreyfus also serves as sub-investment
adviser to and/or administrator of other investment companies.
Dreyfus Service Corporation, a wholly-owned subsidiary of
Dreyfus, serves primarily as a registered broker-dealer of
shares of investment companies sponsored by Dreyfus and of other
investment companies for which Dreyfus acts as investment
adviser, sub-investment adviser or administrator. Dreyfus
Management, Inc., another wholly-owned subsidiary, provides
investment management services to various pension plans,
institutions and individuals.
Item 28. Business and Other Connections of Investment Adviser (continued)
________ ________________________________________________________________
Officers and Directors of Investment Adviser
____________________________________________
Name and Position
with Dreyfus Other Businesses
_________________ ________________
MANDELL L. BERMAN Real estate consultant and private investor
Director 29100 Northwestern Highway, Suite 370
Southfield, Michigan 48034;
Past Chairman of the Board of Trustees:
Skillman Foundation;
Member of The Board of Vintners Intl.
FRANK V. CAHOUET Chairman of the Board, President and
Director Chief Executive Officer:
Mellon Bank Corporation****;
Mellon Bank, N.A.****
Director:
Avery Dennison Corporation
150 North Orange Grove Boulevard
Pasadena, California 91103;
Saint-Gobain Corporation
750 East Swedesford Road
Valley Forge, Pennsylvania 19482;
Teledyne, Inc.
1901 Avenue of the Stars
Los Angeles, California 90067
ALVIN E. FRIEDMAN Senior Adviser to Dillon, Read & Co. Inc.
Director 535 Madison Avenue
New York, New York 10022;
Director and Member of the Executive
Committee of Avnet, Inc.**
LAWRENCE M. GREENE Director:
Director Dreyfus America Fund
JULIAN M. SMERLING None
Director
HOWARD STEIN Chairman of the Board:
Chairman of the Board and Dreyfus Acquisition Corporation*;
Chief Executive Officer The Dreyfus Consumer Credit Corporation*;
Dreyfus Management, Inc.*;
Dreyfus Service Corporation*;
Chairman of the Board and Chief Executive
Officer:
Major Trading Corporation*;
Director:
Avnet, Inc.**;
Dreyfus America Fund++++;
The Dreyfus Fund International
Limited+++++;
World Balanced Fund+++;
Dreyfus Partnership Management,
Inc.*;
Dreyfus Personal Management, Inc.*;
Dreyfus Precious Metals, Inc.*;
Dreyfus Service Organization, Inc.***;
Seven Six Seven Agency, Inc.*;
Trustee:
Corporate Property Investors
New York, New York
W. KEITH SMITH Chairman and Chief Executive Officer:
Vice Chairman of the Board The Boston Company*****;
Vice Chairman of the Board:
Mellon Bank Corporation****;
Mellon Bank, N.A.****;
Director:
Dentsply International, Inc.
570 West College Avenue
York, Pennsylvania 17405
CHRISTOPHER M. CONDRON Vice Chairman:
President, Chief Mellon Bank Corporation****;
Operating Officer The Boston Company*****;
and a Director Deputy Director:
Mellon Trust****;
Chief Executive Officer:
The Boston Company Asset Management,
Inc.*****;
President:
Boston Safe Deposit and Trust Company*****
STEPHEN E. CANTER Director:
Vice Chairman and The Dreyfus Trust Company++;
Chief Investment Officer, Formerly, Chairman and Chief Executive Officer:
and a Director Kleinwort Benson Investment Management
Americas Inc.*
LAWRENCE S. KASH Chairman, President and Chief
Vice Chairman-Distribution Executive Officer:
and a Director The Boston Company Advisors, Inc.
53 State Street
Exchange Place
Boston, Massachusetts 02109
Executive Vice President and Director:
Dreyfus Service Organization, Inc.***;
Director:
The Dreyfus Consumer Credit Corporation*;
The Dreyfus Trust Company++;
Dreyfus Service Corporation*;
President:
The Boston Company*****;
Laurel Capital Advisors****;
Boston Group Holdings, Inc.;
Executive Vice President:
Mellon Bank, N.A.****;
Boston Safe Deposit and Trust
Company*****;
PHILIP L. TOIA Chairman of the Board and Trust Investment
Vice Chairman-Operations Officer:
and Administration The Dreyfus Trust Company++;
and a Director Chairman of the Board and Chief Operating
Officer:
Major Trading Corporation*;
Chairman and Director:
Dreyfus Transfer, Inc.
One American Express Plaza
Providence, Rhode Island 02903
Director:
Dreyfus Precious Metals, Inc.*;
Dreyfus Service Corporation*;
Seven Six Seven Agency, Inc.*;
President and Director:
Dreyfus Acquisition Corporation*;
The Dreyfus Consumer Credit Corporation*;
Dreyfus-Lincoln, Inc.*;
Dreyfus Management, Inc.*;
Dreyfus Personal Management, Inc.*;
Dreyfus Partnership Management, Inc.+;
Dreyfus Service Organization, Inc.***;
The Truepenny Corporation*;
Formerly, Senior Vice President:
The Chase Manhattan Bank, N.A. and
The Chase Manhattan Capital Markets
Corporation
One Chase Manhattan Plaza
New York, New York 10081
WILLIAM T. SANDALLS, JR. Director:
Senior Vice President and Dreyfus Partnership Management, Inc.*;
Chief Financial Officer Seven Six Seven Agency, Inc.*;
President and Director:
Lion Management, Inc.*;
Executive Vice President and Director:
Dreyfus Service Organization, Inc.*;
Vice President, Chief Financial Officer and
Director:
Dreyfus Acquisition Corporation*;
Vice President and Director:
The Dreyfus Consumer Credit Corporation*;
The Truepenny Corporation*;
Treasurer, Financial Officer and Director:
The Dreyfus Trust Company++;
Treasurer and Director:
Dreyfus Management, Inc.*;
Dreyfus Personal Management, Inc.*;
Dreyfus Service Corporation*;
Major Trading Corporation*;
Formerly, President and Director:
Sandalls & Co., Inc.
BARBARA E. CASEY President:
Vice President- Dreyfus Retirement Services Division;
Dreyfus Retirement Executive Vice President:
Services Boston Safe Deposit & Trust Co.*****
Dreyfus Service Corporation*
ELIE M. GENADRY President:
Vice President- Institutional Services Division of Dreyfus
Institutional Sales Service Corporation*;
Broker-Dealer Division of Dreyfus Service
Corporation*;
Group Retirement Plans Division of Dreyfus
Service Corporation;
Executive Vice President:
Dreyfus Service Corporation*;
Dreyfus Service Organization, Inc.***;
Vice President:
The Dreyfus Trust Company++
WILLIAM F. GLAVIN, JR. Executive Vice President:
Vice President-Corporate Dreyfus Service Corporation*;
Development Senior Vice President:
The Boston Company Advisors, Inc.
53 State Street
Exchange Place
Boston, Massachusetts 02109
MARK N. JACOBS Vice President, Secretary and Director:
Vice President- Lion Management, Inc.*;
General Counsel Secretary:
and Secretary The Dreyfus Consumer Credit Corporation*;
Dreyfus Management, Inc.*;
Assistant Secretary:
Dreyfus Service Organization, Inc.***;
Major Trading Corporation*;
The Truepenny Corporation*
PATRICE M. KOZLOWSKI None
Vice President-
Corporate Communications
MARY BETH LEIBIG None
Vice President-
Human Resources
JEFFREY N. NACHMAN President and Director:
Vice President-Mutual Fund Dreyfus Transfer, Inc.
Accounting One American Express Plaza
Providence, Rhode Island 02903
ANDREW S. WASSER Vice President:
Vice President-Information Mellon Bank Corporation****
Services
MAURICE BENDRIHEM Treasurer:
Controller Dreyfus Partnership Management, Inc.*;
Dreyfus Precious Metals, Inc.*;
Dreyfus Service Organization, Inc.***;
Seven Six Seven Agency, Inc.*;
The Truepenny Corporation*;
Controller:
Dreyfus Acquisition Corporation*;
Dreyfus Service Corporation*;
The Dreyfus Trust Company++;
The Dreyfus Consumer Credit Corporation*;
Formerly, Vice President-Financial Planning,
Administration and Tax:
Showtime/The Movie Channel, Inc.
1633 Broadway
New York, New York 10019
ELVIRA OSLAPAS Assistant Secretary:
Assistant Secretary Dreyfus Service Corporation*;
Dreyfus Management, Inc.*;
Dreyfus Acquisition Corporation, Inc.*;
The Truepenny Corporation+
______________________________________
* The address of the business so indicated is 200 Park Avenue, New
York, New York 10166.
** The address of the business so indicated is 80 Cutter Mill Road,
Great Neck, New York 11021.
*** The address of the business so indicated is 131 Second Street, Lewes,
Delaware 19958.
**** The address of the business so indicated is One Mellon Bank Center,
Pittsburgh, Pennsylvania 15258.
***** The address of the business so indicated is One Boston Place, Boston,
Massachusetts 02108.
+ The address of the business so indicated is Atrium Building, 80 Route
4 East, Paramus, New Jersey 07652.
++ The address of the business so indicated is 144 Glenn Curtiss
Boulevard, Uniondale, New York 11556-0144.
+++ The address of the business so indicated is One Rockefeller Plaza,
New York, New York 10020.
++++ The address of the business so indicated is 2 Boulevard Royal,
Luxembourg.
+++++ The address of the business so indicated is Nassau, Bahama Islands.
Item 29. Principal Underwriters
________ ______________________
(a) Other investment companies for which Registrant's principal
underwriter (exclusive distributor) acts as principal underwriter or
exclusive distributor:
1) Comstock Partners Strategy Fund, Inc.
2) Dreyfus A Bonds Plus, Inc.
3) Dreyfus Appreciation Fund, Inc.
4) Dreyfus Asset Allocation Fund, Inc.
5) Dreyfus Balanced Fund, Inc.
6) Dreyfus BASIC GNMA Fund
7) Dreyfus BASIC Money Market Fund, Inc.
8) Dreyfus BASIC Municipal Fund, Inc.
9) Dreyfus BASIC U.S. Government Money Market Fund
10) Dreyfus California Intermediate Municipal Bond Fund
11) Dreyfus California Tax Exempt Bond Fund, Inc.
12) Dreyfus California Tax Exempt Money Market Fund
13) Dreyfus Capital Value Fund, Inc.
14) Dreyfus Cash Management
15) Dreyfus Cash Management Plus, Inc.
16) Dreyfus Connecticut Intermediate Municipal Bond Fund
17) Dreyfus Connecticut Municipal Money Market Fund, Inc.
18) Dreyfus Edison Electric Index Fund, Inc.
19) Dreyfus Florida Intermediate Municipal Bond Fund
20) Dreyfus Florida Municipal Money Market Fund
21) The Dreyfus Fund Incorporated
22) Dreyfus Global Bond Fund, Inc.
23) Dreyfus Global Growth Fund
24) Dreyfus GNMA Fund, Inc.
25) Dreyfus Government Cash Management
26) Dreyfus Growth and Income Fund, Inc.
27) Dreyfus Growth and Value Funds, Inc.
28) Dreyfus Growth Opportunity Fund, Inc.
29) Dreyfus Institutional Money Market Fund
30) Dreyfus Institutional Short Term Treasury Fund
31) Dreyfus Insured Municipal Bond Fund, Inc.
32) Dreyfus Intermediate Municipal Bond Fund, Inc.
33) Dreyfus International Equity Fund, Inc.
34) The Dreyfus/Laurel Funds, Inc.
35) The Dreyfus/Laurel Funds Trust
36) The Dreyfus/Laurel Tax-Free Municipal Funds
37) The Dreyfus/Laurel Investment Series
38) Dreyfus Life and Annuity Index Fund, Inc.
39) Dreyfus LifeTime Portfolios, Inc.
40) Dreyfus Liquid Assets, Inc.
41) Dreyfus Massachusetts Intermediate Municipal Bond Fund
42) Dreyfus Massachusetts Municipal Money Market Fund
43) Dreyfus Massachusetts Tax Exempt Bond Fund
44) Dreyfus Michigan Municipal Money Market Fund, Inc.
45) Dreyfus Money Market Instruments, Inc.
46) Dreyfus Municipal Bond Fund, Inc.
47) Dreyfus Municipal Cash Management Plus
48) Dreyfus Municipal Money Market Fund, Inc.
49) Dreyfus New Jersey Intermediate Municipal Bond Fund
50) Dreyfus New Jersey Municipal Bond Fund, Inc.
51) Dreyfus New Jersey Municipal Money Market Fund, Inc.
52) Dreyfus New Leaders Fund, Inc.
53) Dreyfus New York Insured Tax Exempt Bond Fund
54) Dreyfus New York Municipal Cash Management
55) Dreyfus New York Tax Exempt Bond Fund, Inc.
56) Dreyfus New York Tax Exempt Intermediate Bond Fund
57) Dreyfus New York Tax Exempt Money Market Fund
58) Dreyfus Ohio Municipal Money Market Fund, Inc.
59) Dreyfus 100% U.S. Treasury Intermediate Term Fund
60) Dreyfus 100% U.S. Treasury Long Term Fund
61) Dreyfus 100% U.S. Treasury Money Market Fund
62) Dreyfus 100% U.S. Treasury Short Term Fund
63) Dreyfus Pennsylvania Intermediate Municipal Bond Fund
64) Dreyfus Pennsylvania Municipal Money Market Fund
65) Dreyfus Short-Intermediate Government Fund
66) Dreyfus Short-Intermediate Municipal Bond Fund
67) Dreyfus Investment Grade Bond Funds, Inc.
68) The Dreyfus Socially Responsible Growth Fund, Inc.
69) Dreyfus Strategic Income
70) Dreyfus Strategic Investing
71) The Dreyfus Third Century Fund, Inc.
72) Dreyfus Treasury Cash Management
73) Dreyfus Treasury Prime Cash Management
74) Dreyfus Variable Investment Fund
75) Dreyfus-Wilshire Target Funds, Inc.
76) Dreyfus Worldwide Dollar Money Market Fund, Inc.
77) General California Municipal Bond Fund, Inc.
78) General California Municipal Money Market Fund
79) General Government Securities Money Market Fund, Inc.
80) General Money Market Fund, Inc.
81) General Municipal Bond Fund, Inc.
82) General Municipal Money Market Fund, Inc.
83) General New York Municipal Bond Fund, Inc.
84) General New York Municipal Money Market Fund
85) Peoples Index Fund, Inc.
86) Peoples S&P MidCap Index Fund, Inc.
87) Premier Insured Municipal Bond Fund
88) Premier California Municipal Bond Fund
89) Premier Equity Funds, Inc.
90) Premier Global Investing, Inc.
91) Premier GNMA Fund
92) Premier Growth Fund, Inc.
93) Premier Municipal Bond Fund
94) Premier New York Municipal Bond Fund
95) Premier State Municipal Bond Fund
96) Premier Strategic Growth Fund
(b)
Positions and
Name and principal Positions and offices with offices with
business address the Distributor Registrant
__________________ ___________________________ _____________
Marie E. Connolly+ Director, President, Chief President and
Executive Officer and Compliance Treasurer
Officer
Joseph F. Tower, III+ Senior Vice President, Treasurer Assistant
and Chief Financial Officer Treasurer
John E. Pelletier+ Senior Vice President, General Vice President
Counsel, Secretary and Clerk and Secretary
Frederick C. Dey++ Senior Vice President Vice President
and Assistant
Treasurer
Eric B. Fischman++ Vice President and Associate Vice President
General Counsel and Assistant
Secretary
Paul Prescott+ Vice President None
Elizabeth Bachman++ Assistant Vice President Vice President
and Assistant
Secretary
Mary Nelson+ Assistant Treasurer None
John J. Pyburn++ Assistant Treasurer Assistant
Treasurer
Jean M. O'Leary+ Assistant Secretary and None
Assistant Clerk
John W. Gomez+ Director None
William J. Nutt+ Director None
________________________________
+ Principal business address is One Exchange Place, Boston, Massachusetts
02109.
++ Principal business address is 200 Park Avenue, New York, New York 10166.
Item 30. Location of Accounts and Records
________________________________
1. First Data Investor Services Group, Inc.,
a subsidiary of First Data Corporation
P.O. Box 9671
Providence, Rhode Island 02940-9671
2. The Bank of New York
90 Washington Street
New York, New York 10286
3. Dreyfus Transfer, Inc.
P.O. Box 9671
Providence, Rhode Island 02940-9671
4. The Dreyfus Corporation
200 Park Avenue
New York, New York 10166
Item 31. Management Services
_______ ___________________
Not Applicable
Item 32. Undertakings
________ ____________
(1) To call a meeting of shareholders for the purpose of voting upon
the question of removal of a trustee or trustees when requested
in writing to do so by the holders of at least 10% of the
Registrant's outstanding shares of beneficial interest and in
connection with such meeting to comply with the provisions of
Section 16(c) of the Investment Company Act of 1940 relating to
shareholder communications.
SIGNATURES
---------------
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant certifies that it meets all
of the requirements for effectiveness of this Amendment to the
Registration Statement pursuant to Rule 485(b) under the Securities Act of
1933 and has duly caused this Amendment to the Registration Statement to
be signed on its behalf by the undersigned, thereunto duly authorized, in
the City of New York, and State of New York on the 24th day of May, 1996.
DREYFUS TAX EXEMPT CASH MANAGEMENT
BY: /s/Marie E. Connolly*
----------------------------------
Marie E. Connolly, PRESIDENT
Pursuant to the requirements of the Securities Act of 1933, this
Amendment to the Registration Statement has been signed below by the
following persons in the capacities and on the dates indicated.
Signatures Title Date
_______________________ __________________________ _______
/s/Marie E. Connolly* President and Treasurer 5/24/96
- ---------------------------- (Principal Executive, Financial
Marie E. Connolly and Accounting Officer)
/s/David W. Burke* Trustee 5/24/96
- ----------------------------
David W. Burke
/s/Isabel P. Dunst* Trustee 5/24/96
- ----------------------------
Isabel P. Dunst
/s/Lyle E. Gramley* Trustee 5/24/96
- ----------------------------
Lyle E. Gramley
/s/Warren B. Rudman* Trustee 5/24/96
- ----------------------------
Warren B. Rudman
*BY: ______________________
Eric B. Fishman
Attorney-in-Fact
EXHIBIT INDEX
EXHIBIT NO. EXHIBIT
(11) Consent of Independent Auditors
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the captions "Condensed
Financial Information" and "Transfer and Dividend Disbursing Agent,
Custodian, Counsel and Independent Auditors" and to the use of our report
dated March 5, 1996, in this Registration Statement (Form N-1A 2-89275)
of Dreyfus Tax Exempt Cash Management.
ERNST & YOUNG LLP
New York, New York
May 24, 1996
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