<PAGE>
[LOGO OF EATON VANCE APPEARS HERE] [PHOTO OF AMERICAN FLAG APPEARS HERE]
Investing for the 21st Century
Semiannual Report June 30, 1997
[PHOTO OF STATUE OF LIBERTY APPEARS HERE]
EATON VANCE
Cash Management Fund
MONEY
Liquid Assets Trust
MARKET
Money Market Fund
FUNDS
Global Management-Global Distribution
[PHOTO OF COLUMNS APPEARS HERE]
<PAGE>
EV Money Market Funds as of June 30, 1997
INVESTMENT UPDATE
[PHOTO OF M. DOZIER GARDNER APPEARS HERE]
M. Dozier Gardner,
President
Investment Environment
- --------------------------------------------------------------------------------
The Economy
. During the first half of 1997, economic conditions in the U.S. were very
favorable as the economy's expansion continued into its seventh year. Gross
Domestic Product (GDP), the primary benchmark for measuring economic growth,
increased at an annualized rate of 4.9% during the first quarter. In the
second quarter, the economy slowed somewhat, with advance estimates showing an
annualized GDP increase of 2.2%.
. Unemployment remained low throughout the period, hitting a 24-year low of 4.8%
in May and rising slightly to 5.0% in June.
. The continued growth of the economy, combined with a tight labor market, has
caused concern that inflation may increase. Thus far this has not occurred.
During the first half of 1997, the Consumer Price Index rose at an annual rate
of only 1.4%, the slowest rate of increase since 1986.
The Market
. The six-month period was a fairly quiet and stable one for short-term bonds.
The exception was an increase in the Federal Funds target rate by 0.25% to
5.50% on March 25. The Fed Funds rate is the rate for interbank overnight
loans and serves as a key interest rate barometer.
. As the chart to the right indicates, 60-day commercial paper (CP) rates rose
roughly 0.25% after the increase in the Federal Funds target rate. Prior to
the rate increase, 60-day commercial paper rates averaged 5.3%; after rates
were raised, CP rates averaged 5.6%.
. 60-day commercial paper is a commonly used liquid investment for money market
funds. On average, approximately 80% of the assets of the Eaton Vance Money
Market Funds is invested in high-quality commercial paper.
The Portfolio
- --------------------------------------------------------------------------------
About The Portfolio
. The Portfolio continues to invest only in securities of the highest quality.
Each of its commercial paper holdings have been given the top credit rating by
at least two nationally recognized statistical rating organizations.
. The Portfolio also invests in U.S. Government agency securities, which are
not rated officially but are considered to be of high quality.*
. The Portfolio continues to maintain an average maturity of between 30 and 40
days.
Short-Term interest rates Rose With Increase In
Fed Funds Target Rate
60-Day Commercial Paper Rates
<TABLE>
<S> <C> <C> <C> <C> <C>
12/31/96 0.054 2/3/97 0.0532 3/3/97 0.0532
0.0535 0.0531 0.0532
0.0537 0.0531 0.0533
0.0534 0.0531 0.0533
0.0534 0.0531 0.0533
0.0532 0.0529 0.0533
0.0532 0.0529 0.0532
0.0533 0.0529 0.0533
0.0534 0.0529 0.0533
0.0536 0.0528 0.0534
0.0533 0.0527 0.0536
0.0532 0.0526 0.0537
0.0532 0.0526 0.0537
0.0534 0.0526 0.054
0.0534 0.0527 0.0548
0.0532 0.0527 0.0552
0.0533 0.053 0.0553
0.0533 0.053 0.0555
0.0534 0.0532 0.0556
0.0534 0.0558
0.0533 0.0559
0.0532
0.0533
4/1/97 0.0556 5/1/97 0.0557 6/2/97 0.0556
0.0556 0.0557 0.0557
0.0556 0.0556 0.0556
0.0555 0.0557 0.0556
0.0555 0.0556 0.0556
0.0555 0.0562 0.0554
0.0554 0.0559 0.0555
0.0555 0.0561 0.0555
0.0554 0.0561 0.0554
0.0556 0.0558 0.0555
0.0555 0.0558 0.0554
0.0555 0.0559 0.0555
0.0556 0.0562 0.0555
0.0555 0.0563 0.0556
0.0556 0.0555 0.0556
0.0557 0.0555 0.0555
0.0556 0.0555 0.0556
0.0556 0.0556 0.0556
0.0557 0.0558 0.0555
0.056 0.0556 0.0555
0.0557 0.0557
0.0557
6/30/97 0.0557
</TABLE>
- --------------------------------------------------------------------------------
* An investment in one of the Portfolio's money market funds is neither insured
nor guaranteed by the U.S. Government, and there can be no assurance that the
Funds will be able to maintain a stable net asset value of $1.00 per share.
- --------------------------------------------------------------------------------
Mutual fund shares are not insured by the FDIC and are not deposits or other
obligations of, or guaranteed by, any depository institution. Shares are subject
to investment risks, including possible loss of principal invested.
- --------------------------------------------------------------------------------
2
<PAGE>
EV Money Market Funds as of June 30, 1997
FINANCIAL STATEMENTS (Unaudited)
Statements of Assets and Liabilities
As of June 30, 1997
<TABLE>
<CAPTION>
Cash Liquid Money
Management Fund Assets Fund Market Fund
- ------------------------------------------------------------------------------------------------------------------------------------
Assets
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Investment in Cash Management Portfolio, at value (Note 1A) $88,192,304 $15,887,744 $31,449,693
Receivable for Fund shares sold 872,263 -- 76,003
Receivable from Fund Administrator (Note 4) -- -- 2,336
Deferred organization expenses (Note 1D) -- -- 19,144
Other assets 13,926 -- 6,413
- ------------------------------------------------------------------------------------------------------------------------------------
Total assets $89,078,493 $15,887,744 $31,553,589
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Liabilities
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Dividends payable $ 141,246 $ 25,410 $ 35,001
Payable for Fund shares redeemed 792,963 14,497 505,854
Payable to affiliate for Trustees' fees (Note 4) 753 -- --
Accrued expenses -- 3,420 --
- ------------------------------------------------------------------------------------------------------------------------------------
Total liabilities $ 934,962 $ 43,327 $ 540,855
- ------------------------------------------------------------------------------------------------------------------------------------
Net Assets (represented by paid-in-capital) $88,143,531 $15,844,417 $31,012,734
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Shares of Beneficial Interest Outstanding (Note 3)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
88,143,531 15,844,417 31,012,734
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Net Asset Value, Offering and Redemption
Price Per Share (Note 6)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
(Net assets/shares of beneficial interest outstanding) $ 1.00 $ 1.00 $ 1.00
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
See notes to financial statements
3
<PAGE>
EV Money Market Funds as of June 30, 1997
FINANCIAL STATEMENTS (Unaudited) CONT'D
Statements of Operations
For the Six Months Ended June 30, 1997
<TABLE>
<CAPTION>
Cash Liquid Money
Management Fund Assets Fund Market Fund
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Investment Income (Note 1B)
- ------------------------------------------------------------------------------------------------------------------------------------
Interest income allocated from Portfolio $ 2,650,217 $ 485,872 $ 825,633
Expenses allocated from Portfolio (289,393) (53,165) (89,822)
- ------------------------------------------------------------------------------------------------------------------------------------
Total investment income $ 2,360,824 $ 432,707 $ 735,811
- ------------------------------------------------------------------------------------------------------------------------------------
Expenses
- ------------------------------------------------------------------------------------------------------------------------------------
Compensation of Trustees not members of the
Administrator's organization (Note 4) $ 1,549 $ -- $ --
Custodian fee 4,827 884 1,502
Distribution fees (Note 5) -- 22,108 120,198
Transfer and dividend disbursing agent fees 41,014 7,075 12,020
Legal and accounting services 5,890 5,890 5,890
Registration fees 16,860 13,885 14,876
Amortization of organization expenses (Note 1D) -- -- 3,452
Printing and postage 6,262 4,811 4,315
Miscellaneous 4,825 4,421 7,512
- ------------------------------------------------------------------------------------------------------------------------------------
Total expenses $ 81,227 $ 59,074 $ 169,765
- ------------------------------------------------------------------------------------------------------------------------------------
Deduct --
Preliminary allocation of expenses to the Administrator (Note 4) $ -- $ -- $ 2,336
- ------------------------------------------------------------------------------------------------------------------------------------
Total expense reductions $ -- $ -- $ 2,336
- ------------------------------------------------------------------------------------------------------------------------------------
Net expenses $ 81,227 $ 59,074 $ 167,429
- ------------------------------------------------------------------------------------------------------------------------------------
Net investment income $ 2,279,597 $ 373,633 $ 568,382
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
See notes to financial statements
4
<PAGE>
EV Money Market Funds as of June 30, 1997
FINANCIAL STATEMENTS (Unaudited) CONT'D
Statements of Changes in Net Assets
For the Six Months Ended June 30, 1997
<TABLE>
<CAPTION>
Cash Liquid Money
Increase (Decrease) in Net Assets Management Fund Assets Fund Market Fund
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
From operations --
Net investment income $ 2,279,597 $ 373,633 $ 568,382
- ----------------------------------------------------------------------------------------------------------------------------------
Distributions to shareholders (Note 2) --
From net Investment income $ (2,279,597) $ (373,633) $ (568,382)
- ----------------------------------------------------------------------------------------------------------------------------------
Transactions in shares of beneficial interest (Note 3) --
Proceeds from sale of Fund shares $ 282,158,850 $ 11,029 $ 135,017,162
Net asset value of shares issued to shareholders electing to receive
payment of distributions in Fund shares 1,346,610 202,412 296,319
Cost of Fund shares redeemed (347,052,839) (4,279,360) (135,550,941)
- ----------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets from Fund share transactions $ (63,547,379) $ (4,065,919) $ (237,460)
- ----------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets $ (63,547,379) $ (4,065,919) $ (237,460)
- ----------------------------------------------------------------------------------------------------------------------------------
Net Assets
- ----------------------------------------------------------------------------------------------------------------------------------
At beginning of period $ 151,690,910 $ 19,910,336 $ 31,250,194
- ----------------------------------------------------------------------------------------------------------------------------------
At end of period $ 88,143,531 $ 15,844,417 $ 31,012,734
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
See notes to financial statements
5
<PAGE>
EV Money Market Funds as of June 30, 1997
FINANCIAL STATEMENTS CONT'D
Statements of Changes in Net Assets
For the Year Ended December 31, 1996
<TABLE>
<CAPTION>
Cash Liquid Money
Increase (Decrease) in Net Assets Management Fund Assets Fund Market Fund
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
From operations --
Net investment income $ 6,465,054 $ 1,072,334 $ 918,209
- ------------------------------------------------------------------------------------------------------------------------------------
Distributions to shareholders (Note 2) --
From net investment income $ (6,465,054) $ (1,072,334) $ (918,209)
- ------------------------------------------------------------------------------------------------------------------------------------
Transactions in shares of beneficial interest (Note 3) --
Proceeds from sale of Fund shares $ 614,892,840 $ 49,292 $ 474,121,094
Net asset value of shares issued to shareholders electing to
receive payment of distributions in Fund shares 4,425,531 660,755 490,977
Cost of Fund shares redeemed (622,878,579) (14,825,975) (456,313,118)
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets from Fund share transactions $ (3,560,208) $ (14,115,928) $ 18,298,953
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets $ (3,560,208) $ (14,115,928) $ 18,298,953
- ------------------------------------------------------------------------------------------------------------------------------------
Net Assets
- ------------------------------------------------------------------------------------------------------------------------------------
At beginning of period $ 155,251,118 $ 34,026,264 $ 12,951,241
- ------------------------------------------------------------------------------------------------------------------------------------
At end of period $ 151,690,910 $ 19,910,336 $ 31,250,194
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
See notes to financial statements
6
<PAGE>
EV Money Market Funds as of June 30, 1997
FINANCIAL STATEMENTS CONT'D
Financial Highlights
<TABLE>
<CAPTION>
Cash Management Fund
----------------------------------------------------------------------------
Six Months Ended Year Ended December 31,
June 30, 1997 ------------------------------------------------------------
(Unaudited) 1996 1995 1994 1993 1992
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value -- Beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ------------------------------------------------------------------------------------------------------------------------------------
Income from operations
- ------------------------------------------------------------------------------------------------------------------------------------
Net investment income $ 0.0234 $ 0.0470 $ 0.0522 $ 0.0345 $ 0.0251 $ 0.0306
- ------------------------------------------------------------------------------------------------------------------------------------
Less distributions
- ------------------------------------------------------------------------------------------------------------------------------------
From net investment income $(0.0234) $(0.0470) $(0.0522) $(0.0345) $(0.0251) $(0.0306)
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value -- End of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ------------------------------------------------------------------------------------------------------------------------------------
Total Return/(1)/ 2.37% 4.82% 5.35% 3.49% 2.54% 3.14%
- ------------------------------------------------------------------------------------------------------------------------------------
Ratios/Supplemental Data
- ------------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (000 omitted) $ 88,144 $151,691 $155,251 $111,622 $112,200 $161,986
Ratio of net expenses to average daily net assets/(2)/ 0.77%+ 0.74% 0.74% 0.84% 0.67% 0.76%
Ratio of net investment income to average
daily net assets/(2)/ 4.72%+ 4.70% 5.22% 3.40% 2.51% 3.09%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
+ Annualized.
/(1)/ Total return is calculated assuming a purchase at the net asset value on
the first day and a sale at the net asset value on the last day of each
period reported. Dividends and distributions, if any, are assumed to be
reinvested at the net asset value on the payable date. Total return is not
computed on an annualized basis.
/(2)/ Includes the Fund's share of Cash Management Portfolio's income and
expenses for the six months ended June 30, 1997 and for the years ended
December 31, 1996 and 1995 and for the period from May 2, 1994 to December
31, 1994.
See notes to financial statements
7
<PAGE>
EV Money Market Funds as of June 30, 1997
FINANCIAL STATEMENTS CONT'D
Financial Highlights
<TABLE>
<CAPTION>
Liquid Assets Fund
----------------------------------------------------------------------------------------
Six Months Ended Year Ended December 31, Year Ended March 31,
June 30, 1997 ------------------------------------------------- ---------------------
(Unaudited) 1996 1995 1994 1993* 1993++ 1992++
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value -- Beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ------------------------------------------------------------------------------------------------------------------------------------
Income from operations
- ------------------------------------------------------------------------------------------------------------------------------------
Net investment income $ 0.0209 $ 0.0432 $ 0.0505 $ 0.0328 $ 0.0113 $ 0.0217 $ 0.0415
- ------------------------------------------------------------------------------------------------------------------------------------
Less distributions
- ------------------------------------------------------------------------------------------------------------------------------------
From net investment income $(0.0209) $(0.0432) $(0.0505) $ (0.0328) $(0.0113) $(0.0217) $(0.0415)
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value -- End of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ------------------------------------------------------------------------------------------------------------------------------------
Total Return/(1)/ 1.94% 4.41% 5.16% 3.29% 1.14% 2.35% 4.38%
- ------------------------------------------------------------------------------------------------------------------------------------
Ratios/Supplemental Data+++
- ------------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (000 omitted) $ 15,844 $ 19,910 $ 34,026 $ 118,599 $ 10,566 $ 18,553 $ 9,145
Ratio of net expenses to average daily
net assets/(2)/ 1.27%+ 1.13% 0.91% 0.94% 1.49%+ 0.92% 1.23%
Ratio of net investment income to average
daily net assets/(2)/ 4.23%+ 4.31% 5.11% 3.55% 1.66%+ 2.33% 4.30%
</TABLE>
+++ For the periods presented below, the operating expenses of the Fund reflect
an allocation of expenses to the Administrator. Had such action not been
taken, the ratios and net investment income per share would have been as
follows:
<TABLE>
<S> <C> <C> <C>
Ratios (As a percentage of average daily net assets):
Expenses/(2)/ 1.80%+ 1.42% 1.73%
Net investment income/(2)/ 1.35%+ 1.85 % 3.80%
Net investment income per share $ 0.0092 $ 0.0171 $ 0.0372
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
+ Annualized.
* For the nine months ended December 31, 1993. The Liquid Assets Fund
changed its fiscal year end from March 31 to December 31, effective
December 31, 1993.
++ Audited by the Fund's previous auditors.
/(1)/ Total return is calculated assuming a purchase at the net asset value on
the first day and a sale at the net asset value on the last day of each
period reported. Dividends and distributions, if any, are assumed to be
reinvested at the net asset value on the payable date. Total return is not
computed on an annualized basis.
/(2)/ Includes the Fund's share of Cash Management Portfolio's income and
expenses for the six months ended June 30, 1997 and for the years ended
December 31, 1996 and 1995 and for the period from May 2, 1994 to December
31, 1994.
See notes to financial statements
8
<PAGE>
EV Money Market Funds as of June 30, 1997
FINANCIAL STATEMENTS CONT'D
Financial Highlights
<TABLE>
<CAPTION>
Money Market Fund
------------------------------------------------------
Six Months Ended Year Ended December 31,
June 30, 1997 -------------------------------
(Unaudited) 1996 1995
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Net asset value -- Beginning of period $ 1.00 $ 1.00 $ 1.00
- -----------------------------------------------------------------------------------------------------------------------------
Income from operations
- -----------------------------------------------------------------------------------------------------------------------------
Net investment income $ 0.0186 $ 0.0370 $ 0.0312
- -----------------------------------------------------------------------------------------------------------------------------
Less distributions
- -----------------------------------------------------------------------------------------------------------------------------
From net investment income $(0.0186) $(0.0370) $(0.0312)
- -----------------------------------------------------------------------------------------------------------------------------
Net asset value -- End of period $ 1.00 $ 1.00 $ 1.00
- -----------------------------------------------------------------------------------------------------------------------------
Total Return/(1)/ 1.73% 3.77% 3.17%
- -----------------------------------------------------------------------------------------------------------------------------
Ratios/Supplemental Data++
- -----------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (000 omitted) $ 31,013 $ 31,250 $ 12,951
Ratio of net expenses to average daily net assets/(2)/ 1.71%+ 1.73% 1.68%+
Ratio of net investment income to average daily net assets/(2)/ 3.78%+ 3.70% 4.19%+
</TABLE>
++ For the six months ended June 30, 1997, the year ended December 31, 1996 and
for the period from April 5, 1995 (start of business) to December 31, 1995,
the operating expenses of the Fund reflect an allocation of expenses to the
Administrator. Had such actions not been taken, the ratios and net
investment income per share would have been as follows:
<TABLE>
<CAPTION>
Ratios (As a percentage of average daily net assets):
<S> <C> <C> <C>
Expenses/(2)/ 1.73%+ 1.76% 1.85%+
Net investment income/(2)/ 3.77%+ 3.66% 4.03%+
Net investment income per share $ 0.0186 $ 0.0367 $ 0.0300
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
+ Annualized.
* For the period from the start of business, April 5, 1994, to December 31,
1995.
/(1)/ Total return is calculated assuming a purchase at the net asset value on
the first day and a sale at the net asset value on the last day of each
period reported. Dividends and distributions, if any, are assumed to be
reinvested at the net asset value on the payable date. Total return is not
computed on an annualized basis.
/(2)/ Includes the Fund's share of Cash Management Portfolio's income and
expenses.
See notes to financial statements
9
<PAGE>
EV Money Market Funds as of June 30, 1997
NOTES TO FINANCIAL STATEMENTS (Unaudited)
1 Significant Accounting Policies
------------------------------------------------------------------------------
Eaton Vance Mutuals Funds Trust (the Trust) is an entity of the type
commonly known as a Massachusetts business trust and is registered under the
Investment Company Act of 1940 as amended (1940 Act), as an open-end
management investment company. The Trust presently consists of fifteen
Funds, three of which are included in these financial statements. They
include Eaton Vance Cash Management Fund ("Cash Management Fund"), Eaton
Vance Liquid Assets Fund ("Liquid Assets Fund") and Eaton Vance Money Market
Fund ("Money Market Fund") (individually, the "Fund", collectively the
"Funds") each of which is registered under the 1940 Act, as diversified,
open-end management investment companies seeking high income consistent with
the preservation of capital and maintenance of liquidity.
The Funds invest all of their investable assets in interests in the Cash
Management Portfolio (the Portfolio), a New York Trust, having the same
investment objective as the Funds. The value of each Fund's investment in
the Portfolio reflects the Fund's proportionate interest in the net assets
of that Portfolio (65.1% for Cash Management Fund, 11.7% for Liquid Assets
Fund and 23.2% for Money Market Fund at June 30, 1997). The performance of
each Fund is directly affected by the performance of the Portfolio. The
financial statements of the Portfolio, including the portfolio of
investments, are included elsewhere in this report and should be read in
conjunction with the Fund's financial statements. The following is a summary
of significant accounting policies consistently followed by the Funds in the
preparation of their financial statements. The policies are in conformity
with generally accepted accounting principles.
A Investment Valuation -- Valuation of securities
by the Portfolios is discussed in Note 1A of the Portfolio's Notes to
Financial Statements which are included elsewhere in this report.
B Income -- The Fund's net investment income consists of the Fund's pro rata
share of the net investment income of the Portfolio, less all actual and
accrued expenses of each Fund determined in accordance with generally
accepted accounting principles.
C Federal Taxes -- The Fund's policy is to comply with the provisions of
the Internal Revenue Code applicable to regulated investment companies and
to distribute to shareholders each year all of its taxable income,
including any net realized gain on investment transactions. Accordingly, no
provision for federal income or excise tax is necessary. At December 31,
1996, Liquid Assets Fund, for federal income tax purposes, had capital loss
carryovers of $6,977, which will reduce the Fund's taxable income arising
from future net realized gain on investment transactions, if any, to the
extent permitted by the Internal Revenue Code, and thus will reduce the
amount of the distributions to shareholders which would otherwise be
necessary to relieve the Fund of any liability for federal income. Such
capital loss carryover will expire on December 31, 2001.
D Deferred Organization Expenses -- Costs incurred by the Money Market Fund
in connection with its organization, including registration costs, are
being amortized on the straight-line basis over five years.
E Use of Estimates -- The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported amounts
of income and expense during the reporting period. Actual results could
differ from those estimates.
F Other -- Investment transactions are accounted for on a trade date basis.
H Interim Financial Information --The interim financial statements relating
to June 30, 1997 and for the six-month period then ended have not been
audited by independent certified public accountants, but in the opinion of
the Fund's management, reflect all adjustments, consisting only of normal
recurring adjustments, necessary for the fair presentation of the financial
statements.
2 Distributions to Shareholders
------------------------------------------------------------------------------
The net investment income of each Fund is determined daily and substantially
all of the net income so determined is declared as a dividend to
shareholders of record at the time of declaration. Dividends are paid
monthly. Dividends are paid in the form of additional shares or, at the
election of the shareholder, in cash.
The Funds distinguish between distributions on a tax basis and a financial
reporting basis. Generally accepted accounting principles require that only
distributions in excess of tax basis earnings and profits be reported in the
financial statements as a return of capital. Differences in the recognition
or classification of income between the financial statements and tax
earnings and profits which result in temporary over distributions for
financial statement purposes are classified as distributions in excess of
net investment income or accumulated net realized gains. Permanent
differences between book and tax accounting relating to distributions are
reclassified to paid-in capital.
10
<PAGE>
EV Money Market Funds as of June 30, 1997
NOTES TO FINANCIAL STATEMENTS (Unaudited) CONT'D
3 Shares of Beneficial Interest
------------------------------------------------------------------------------
The Funds' Declaration of Trust permits the Trustees to issue an unlimited
number of full and fractional shares of beneficial interest, with no par
value. Transactions in Fund shares were as follows:
<TABLE>
<CAPTION>
Cash Management Fund
----------------------------------------
Six Months Ended
June 30, 1997 Year Ended
(Unaudited) December 31, 1996
------------------------------------------------------------------------
<S> <C> <C>
Sales 282,158,850 614,892,840
Issued to shareholders
electing to receive payments
of distributions in Fund
shares 1,346,610 4,425,531
Redemptions (347,052,839) (622,878,579)
------------------------------------------------------------------------
Net decrease (63,547,379) (3,560,208)
------------------------------------------------------------------------
<CAPTION>
Liquid Assets Fund
----------------------------------------
Six Months Ended
June 30, 1997 Year Ended
(Unaudited) December 31, 1996
------------------------------------------------------------------------
<S> <C> <C>
Sales 11,029 49,292
Issued to shareholders
electing to receive payments
of distributions in Fund
shares 202,412 660,755
Redemptions (4,279,360) (14,825,975)
------------------------------------------------------------------------
Net decrease (4,065,919) (14,115,928)
------------------------------------------------------------------------
<CAPTION>
Money Market Fund
----------------------------------------
Six Months Ended
June 30, 1997 Year Ended
(Unaudited) December 31, 1996
------------------------------------------------------------------------
<S> <C> <C>
Sales 135,017,162 474,121,094
Issued to shareholders
electing to receive payments
of distributions in Fund
shares 296,319 490,977
Redemptions (135,550,941) (456,313,118)
------------------------------------------------------------------------
Net increase (decrease) (237,460) 18,298,953
------------------------------------------------------------------------
</TABLE>
4 Transactions with Affiliates
------------------------------------------------------------------------------
Eaton Vance Management (EVM) serves as the administrator of the Funds, but
receives no compensation. The Portfolios have engaged Boston Management and
Research (BMR), a subsidiary of EVM, to render investment advisory
services. See Note 2 of the Portfolio's Notes to Financial Statements which
are included elsewhere in this report. To enhance the net income of the
Money Market Fund for the six months ended June 30, 1997, $2,336 of
expenses related to the operation of the Fund were allocated to EVM. Except
as to Trustees of the Funds and the Portfolio who are not members of EVM's
or BMR's organization, officers and Trustees receive remuneration for their
services to each fund out of such investment adviser fee. Certain of the
officers and Trustees of the Funds and Portfolio are officers and
directors/trustees of the above organizations (Note 5).
5 Distribution Plan
------------------------------------------------------------------------------
Money Market Fund and Liquid Assets Fund have adopted distribution plans
(individually the "Plan" and collectively the "Plans") pursuant to Rule
12b-1 under the 1940 Act. The Plan for Money Market Fund requires the Fund
to pay the Principal Underwriter, Eaton Vance Distributors, Inc. (EVD),
amounts equal to 0.75% of the Fund's average daily net assets, for providing
ongoing distribution services and facilities to the Fund. The Fund will
automatically discontinue payments to EVD during any period in which there
are no outstanding Uncovered Distribution Charges. The Plan for Liquid
Assets Fund does not provide for annual payments to EVD for providing such
services and facilities, however the Plan does require the Fund to calculate
outstanding Uncovered Distribution Charges. Each Fund's balance of Uncovered
Distribution Charges is equivalent to the sum of (i) 6.25% (5% for Liquid
Assets Fund) of the aggregate amount received by the Fund for share sold
plus (ii) distribution fees calculated by applying the rate of 1% over the
prevailing prime rate to the outstanding balance of Uncovered Distribution
Charges of EVD reduced by the aggregate amount of contingent deferred sales
charges (Note 6) and amounts theretofore paid to EVD. For the six month
period ended June 30, 1997, Money Market Fund paid $112,686 to EVD,
representing 0.75% of the Fund's average daily net assets. At June 30, 1997,
the amount of Uncovered Distribution Charges of EVD calculated under the
Plan for Money Market Fund and Liquid Assets Fund were approximately
$161,000 and $2,115,000 respectively.
In addition, the Plan authorized the Funds to make payments of service fees
to the Principal Underwriter, Authorized Firms and other persons in amounts
not exceeding 0.25% of the Fund's average daily net assets. The Trustees of
the Funds had initially implemented the Plans by authorizing the Funds to
make quarterly service fee payments to the Principal Underwriter and
Authorized Firms in amounts not expected to exceed 0.15% (0.25% for
11
<PAGE>
EV Money Market Funds as of June 30, 1997
NOTES TO FINANCIAL STATEMENTS (Unaudited) CONT'D
Liquid Assets Fund) per annum of each Fund's average daily net assets based
on the value of the Fund shares sold by such persons and remaining
outstanding for at least one year. For the six month period ended June 30,
1997, Money Market Fund and Liquid Assets Fund paid service fees to EVD and
Authorized Firms in the amount of $7,512 and $22,108 respectively. Service
fee payments are made for personal services and/or maintenance of
shareholder accounts. Service fees paid to EVD and Authorized Firms were
separate and distinct from the sales commissions and distribution fees
payable by the Fund to EVD, and as such are not subject to automatic
discontinuance when there are no outstanding Uncovered Distribution Charges
of EVD.
Certain of the officers and Trustees of the Funds are officers or directors
of EVD.
6 Contingent Deferred Sales Charge
------------------------------------------------------------------------------
A contingent deferred sales charges (CDSC) is imposed on any redemption of
shares from either Money Market Fund or Liquid Assets Fund made within six
years of purchase. Generally, the CDSC is based upon the lower of the net
asset value at date of redemption or date of purchase. No charge is levied
on shares acquired by reinvestment of dividends or capital gains
distributions. The CDSC is imposed at rates that begin 5% in the case of
redemptions in the first and second year after purchase, declining one
percentage point subsequent year. No CDSC is levied on shares which have
been sold to EVM or its affiliates or to their respective employees or
clients. CDSC charges are paid to EVD to reduce the amount of Uncovered
Distribution Charges calculated under the Fund's Distribution Plan. CDSC
charges received when no Uncovered Distribution Charges exist will be
credited to the Fund. EVD received approximately $98,000 and $29,000 of CDSC
paid by shareholders for the six month period ended June 30, 1997 for the
Money Market Fund and Liquid Assets Fund, respectively.
7 Investment Transactions
------------------------------------------------------------------------------
Increases and decreases in the Funds' investment in the Portfolio for the
six months ended June 30, 1997 were as follows:
<TABLE>
<CAPTION>
Cash Management Fund
------------------------------------------------------------------------------
<S> <C>
Increases $ 285,568,977
Decreases 350,193,071
<CAPTION>
Liquid Assets Fund
------------------------------------------------------------------------------
<S> <C>
Increases $ 30,239
Decreases 4,574,623
<CAPTION>
Money Market Fund
------------------------------------------------------------------------------
<S> <C>
Increases $ 145,229,845
Decreases 135,721,038
</TABLE>
12
<PAGE>
Cash Management Portfolio as of June 30, 1997
PORTFOLIO OF INVESTMENTS (Unaudited)
Commercial Paper -- 87.6%
<TABLE>
<CAPTION>
Ratings (Unaudited)
- ------------------- Principal
Amount
Standard (000
Moody's & Poor's omitted) Security Value
- --------------------------------------------------------------------------------
Agricultural Services -- 1.8%
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
P-1 A-1 $2,500 Cargill, Inc., 5.51%, 9/22/97 $ 2,468,241
- --------------------------------------------------------------------------------
$ 2,468,241
- --------------------------------------------------------------------------------
Auto and Parts -- 0.9%
- --------------------------------------------------------------------------------
P-1 A-1 $1,200 Ford Motor Credit Co.,
5.53%, 7/16/97 $ 1,197,235
- --------------------------------------------------------------------------------
$ 1,197,235
- --------------------------------------------------------------------------------
Banking and Finance -- 24.3%
- --------------------------------------------------------------------------------
P-1 A-1+ $2,900 American Express Credit
Corp., 5.51%, 7/2/97 $ 2,899,556
P-1 A-1+ 1,650 Asset Securitization Coop.
Corp., 5.52%, 7/28/97/(1)/ 1,643,169
P-1 A-1+ 1,700 Asset Securitization Coop.
Corp., 5.58%, 7/3/97/(1)/ 1,699,473
P-1 A-1+ 2,200 Associates Corp. of No.
America, 5.55%, 9/19/97 2,172,867
P-1 A-1+ 1,300 Associates Corp. of No.
America, 5.61%, 8/12/97 1,291,491
P-1 A-1+ 2,000 CIESCO, 5.55%, 8/4/97 1,989,517
P-1 A-1+ 2,000 CIESCO, 5.58%, 7/17/97 1,995,040
P-1 A-1 2,500 CIT Group Holdings, Inc.,
5.53%, 7/22/97 2,491,935
P-1 A-1+ 2,500 Corporate Asset Funding Co.,
5.55%, 8/14/97/(2)/ 2,483,042
P-1 A-1+ 2,000 CXC, Inc., 5.60%, 7/14/97/(1)/ 1,995,956
P-1 A-1+ 2,600 Delaware Funding Corp.,
5.68%, 7/11/97/(1)/ 2,595,898
P-1 A-1+ 3,000 Greenwich Asset Funding,
5.57%, 7/21/97/(1)/ 2,990,717
P-1 A-1+ 2,900 Norwest Financial, Inc.,
5.60%, 7/18/97 2,892,331
P-1 A-1+ 1,500 Norwest Financial, Inc.,
5.60%, 7/25/97 1,494,400
P-1 A-1+ 2,300 U.S. Central Credit Union,
5.52%, 9/24/97 2,270,023
- --------------------------------------------------------------------------------
$ 32,905,415
- --------------------------------------------------------------------------------
Business Products and Services -- 2.8%
- --------------------------------------------------------------------------------
P-1 A-1+ $2,750 Pitney Bowes Credit Corp.,
5.52%, 7/23/97 $ 2,740,723
P-1 A-1+ 1,090 Pitney Bowes Credit Corp.,
5.57%, 7/15/97 1,087,639
- --------------------------------------------------------------------------------
$ 3,828,362
- --------------------------------------------------------------------------------
Chemicals -- 1.6%
- --------------------------------------------------------------------------------
P-1 A-1+ $2,200 E.I. Dupont de Nemours &
Co., 5.49%, 7/11/97/(1)/ $ 2,196,645
- --------------------------------------------------------------------------------
$ 2,196,645
- --------------------------------------------------------------------------------
Communications Equipment -- 2.9%
- --------------------------------------------------------------------------------
P-1 A-1+ $4,000 Ameritech Corp.,
5.55%, 9/8/97 $ 3,957,450
- --------------------------------------------------------------------------------
$ 3,957,450
- --------------------------------------------------------------------------------
Electric Utilities -- 4.1%
- --------------------------------------------------------------------------------
P-1 A-1+ $2,800 National Rural Utilities
Coop. Co., 5.61%, 8/18/97 $ 2,779,056
P-1 A-1+ 800 Potomac Electric Power Co.,
5.53%, 7/9/97 799,017
P-1 A-1+ 2,000 Teco Finance, Inc.,
5.62%, 7/10/97/(1)/ 1,997,190
- --------------------------------------------------------------------------------
$ 5,575,263
- --------------------------------------------------------------------------------
Electrical and Electronic Equipment -- 8.9%
- --------------------------------------------------------------------------------
P-1 A-1+ $2,000 General Electric Capital
Corp., 5.57%, 8/22/97 $ 1,983,909
P-1 A-1+ 1,700 General Electric Capital
Corp., 5.60%, 9/9/97 1,681,489
P-1 A-1+ 1,600 General Electric Capital
Corp., 5.60%, 8/15/97 1,588,800
P-1 A-1+ 2,500 Motorola Credit Corp.,
5.50%, 9/11/97 2,472,500
P-1 A-1+ 1,300 Motorola Credit Corp.,
5.50%, 7/29/97 1,294,439
P-1 A-1+ 3,000 Panasonic Finance, Inc.,
5.60%, 8/7/97/(1)/ 2,982,734
- --------------------------------------------------------------------------------
$ 12,003,871
- --------------------------------------------------------------------------------
</TABLE>
See notes to financial statements
13
<PAGE>
Cash Management Portfolio as of June 30, 1997
PORTFOLIO OF INVESTMENTS (Unaudited) CONT'D
<TABLE>
<CAPTION>
Ratings (Unaudited)
- ------------------- Principal
Amount
Standard (000
Moody's & Poor's omitted) Security Value
- --------------------------------------------------------------------------------
Food and Beverages -- 9.1%
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
P-1 A-1 $1,830 Anheuser-Busch Co.,
6.25%, 7/1/97/(1)/ $ 1,830,000
P-1 A-1+ 4,000 Coca-Cola Co.,
5.50%, 8/11/97/(1)/ 3,974,944
P-1 A-1+ 2,500 Kellogg Co., 5.50%, 8/6/97 2,486,250
P-1 A-1+ 4,000 Nestle Capital Corp.,
5.53%, 7/25/97 3,985,253
- --------------------------------------------------------------------------------
$ 12,276,447
- --------------------------------------------------------------------------------
Household Products -- 5.7%
- --------------------------------------------------------------------------------
P-1 A-1+ $ 780 Procter & Gamble Co.,
5.50%, 9/26/97 $ 769,633
P-1 A-1+ 3,000 Proctor & Gamble Co.,
5.52%, 7/7/97 2,997,240
P-1 A-1+ 4,000 Unilever Capital Corp.,
5.64%, 7/8/97/(1)/ 3,995,613
- --------------------------------------------------------------------------------
$ 7,762,486
- --------------------------------------------------------------------------------
Insurance -- 17.3%
- --------------------------------------------------------------------------------
P-1 A-1+ $2,000 AI Credit Corp.,
5.60%, 7/16/97 $ 1,995,333
P-1 A-1+ 2,200 AIG Funding, Inc.,
5.52%, 9/10/97 2,176,049
P-1 A-1+ 2,500 American General Corp.,
5.55%, 8/21/97 2,480,344
P-1 A-1+ 1,000 APC Funding Corp.,
5.55%, 7/15/97 997,842
P-1 A-1+ 1,229 APC Funding Corp.,
5.55%, 7/22/97 1,225,021
P-1 A-1+ 2,600 Marsh & McLennan Cos.,
6.20%, 7/1/97/(1)/ 2,600,000
P-1 A-1+ 2,000 MetLife Funding, Inc.,
5.55%, 7/1/97 2,000,000
P-1 A-1+ 2,000 Prudential Funding Corp.,
5.55%, 7/15/97 1,995,683
P-1 A-1+ 2,000 SAFECO Credit Co., Inc.,
5.58%, 7/3/97 1,999,380
P-1 A-1+ 2,000 SAFECO Credit Co., Inc.,
5.62%, 8/5/97 1,989,072
P-1 A-1+ 1,125 USAA Capital Corp.,
5.52%, 7/31/97 1,119,825
P-1 A-1+ 1,375 USAA Capital Corp.,
5.54%, 10/1/97 1,355,533
P-1 A-1+ 1,500 USAA Capital Corp.,
5.62%, 7/25/97 1,494,380
- --------------------------------------------------------------------------------
$ 23,428,462
- --------------------------------------------------------------------------------
Oil -- 5.8%
- --------------------------------------------------------------------------------
P-1 A-1+ $5,000 Chevron Oil Finance Co.,
5.45%, 7/8/97 $ 4,994,705
P-1 A-1+ 2,800 Exxon Imperial U.S., Inc.,
5.51%, 7/9/97/(2)/ 2,796,572
- --------------------------------------------------------------------------------
$ 7,791,277
- --------------------------------------------------------------------------------
Pharmaceutical -- 2.4%
- --------------------------------------------------------------------------------
P-1 A-1+ $3,300 Novartis Finance Corp.,
5.63%, 7/3/97 $ 3,298,968
- --------------------------------------------------------------------------------
$ 3,298,968
- --------------------------------------------------------------------------------
Total Commercial Paper, at value
(identified cost $118,690,122) $ 118,690,122
- --------------------------------------------------------------------------------
</TABLE>
See notes to financial statements
14
<PAGE>
Cash Management Portfolio as of June 30, 1997
PORTFOLIO OF INVESTMENTS (Unaudited) CONT'D
U.S. Government Obligations -- 12.4%
<TABLE>
<CAPTION>
Ratings (Unaudited)
- ------------------- Principal
Amount
Standard (000
Moody's & Poor's omitted) Security Value
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
$5,000 FHLB Discount Notes,
5.50%, 7/24/97 $ 4,982,431
6,900 FHLMC Discount Notes,
5.53%, 8/1/97 6,867,143
5,000 FHLB Discount Notes,
5.45%, 7/30/97 4,978,047
- --------------------------------------------------------------------------------
Total U.S. Government Obligations, at value
(identified cost $16,827,621) $ 16,827,621
- --------------------------------------------------------------------------------
Total Investments -- 100.0%
(identified cost $135,517,743) $ 135,517,743
- --------------------------------------------------------------------------------
Other Assets, Less Liabilities -- 0.0% $ 11,998
- --------------------------------------------------------------------------------
Net Assets -- 100% $ 135,529,741
- --------------------------------------------------------------------------------
</TABLE>
FHLB-Federal Home Loan Bank
FHLMC-Federal Home Mortgage Corporation (Freddie Mac)
/(1)/ A security has been issued under section 4(2) of the Securities Act of
1933 is generally regarded as restricted and illiquid. These securities
may be resold in transactions exempt from registration or to the public if
the securities are registered. All such securities held have been deemed
by the Portfolio's Trustees to be liquid and were purchased with the
expectation that resale would not be necessary. At June 30, 1997, the
value of these securities amounted to $28,305,694 or 20.9% of the
Portfolio's net assets.
/(2)/ Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. It is the
Portfolio's intention to hold the security until maturity. At June 30,
1997, the value of these securities amounted to $7,476,259 or 5.5% of net
assets.
See notes to financial statements
15
<PAGE>
Cash Management Portfolio as of June 30, 1997
FINANCIAL STATEMENTS (Unaudited)
Statement of Assets and Liabilities
<TABLE>
<CAPTION>
As of June 30, 1997
Assets
- --------------------------------------------------------------------------------
<S> <C>
Investments, at value (Note 1A) $ 135,517,743
Cash 30,791
Deferred organization expenses (Note 1D) 5,008
- --------------------------------------------------------------------------------
Total assets $ 135,553,542
- --------------------------------------------------------------------------------
Liabilities
- --------------------------------------------------------------------------------
Payable to affiliate for Trustees' fees (Note 2) $ 3,927
Accrued expenses 19,874
- --------------------------------------------------------------------------------
Total liabilities $ 23,801
- --------------------------------------------------------------------------------
Net Assets $ 135,529,741
- --------------------------------------------------------------------------------
Sources of Net Assets
- --------------------------------------------------------------------------------
Net proceeds from capital contributions and withdrawals $ 135,529,741
- --------------------------------------------------------------------------------
Total $ 135,529,741
- --------------------------------------------------------------------------------
<CAPTION>
Statement of Operations
For the Six Months Ended
June 30, 1997
Investment Income
- --------------------------------------------------------------------------------
<S> <C>
Interest income $ 3,961,722
- --------------------------------------------------------------------------------
Expenses
- --------------------------------------------------------------------------------
Investment adviser fee (Note 2) $ 364,794
Compensation of Trustees not members of the
Investment Adviser's organization (Note 2) 4,688
Custodian fee 36,180
Legal and accounting services 14,748
Printing and postage 3,472
Amortization of organization expenses (Note 1D) 1,352
Miscellaneous 7,146
- --------------------------------------------------------------------------------
Total expenses $ 432,380
- --------------------------------------------------------------------------------
Net investment income $ 3,529,342
- --------------------------------------------------------------------------------
</TABLE>
See notes to financial statements
16
<PAGE>
Cash Management Portfolio as of June 30, 1997
FINANCIAL STATEMENTS CONT'D
Statements of Changes in Net Assets
<TABLE>
<CAPTION>
Six Months Ended
Increase (Decrease) June 30, 1997 Year Ended
in Net Assets (Unaudited) December 31, 1996
- --------------------------------------------------------------------------------
<S> <C> <C>
From operations --
Net investment income $ 3,529,342 $ 9,078,037
- --------------------------------------------------------------------------------
Capital transactions --
Contributions $ 430,829,061 $ 1,075,567,385
Withdrawals (490,488,732) (1,097,885,067)
- --------------------------------------------------------------------------------
Net decrease in net assets
from capital transactions $ (59,659,671) $ (22,317,682)
- --------------------------------------------------------------------------------
Net decrease in net assets $ (56,130,329) $ (13,239,645)
- --------------------------------------------------------------------------------
Net Assets
- --------------------------------------------------------------------------------
At beginning of period $ 191,660,070 $ 204,899,715
- --------------------------------------------------------------------------------
At end of period $ 135,529,741 $ 191,660,070
- --------------------------------------------------------------------------------
</TABLE>
See notes to financial statements
17
<PAGE>
Cash Management Portfolio as of June 30, 1997
FINANCIAL STATEMENTS CONT'D
Supplementary Data
<TABLE>
<CAPTION>
Six Months Ended Year Ended December 31,
June 30, 1997 -----------------------------------
(Unaudited) 1996 1995 1994*
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Ratios to average daily
net assets
- -----------------------------------------------------------------------------------------------------
Expenses 0.60%+ 0.59% 0.60% 0.58%+
Net investment income 4.88%+ 4.83% 5.36% 4.22%+
- -----------------------------------------------------------------------------------------------------
+ Annualized.
* For the period from the start of business, May 2, 1994, to December 31, 1994.
</TABLE>
See notes to financial statements
18
<PAGE>
Cash Management Portfolio as of June 30, 1997
NOTES TO FINANCIAL STATEMENTS (Unaudited)
1 Significant Accounting Policies
-------------------------------------------------------------------------------
Cash Management Portfolio (the Portfolio) is registered under the Investment
Company Act of 1940 as a diversified, open-end management investment company
which was organized as a trust under the laws of the State of New York on May
1, 1992. The Declaration of Trust permits the Trustees to issue interests in
the Portfolio. The following is a summary of significant accounting policies
of the Portfolio. The policies are in conformity with generally accepted
accounting principles.
A Security Valuation -- The Portfolio values investment securities utilizing
the amortized cost valuation technique permitted by Rule 2a-7 of the
Investment Company Act of 1940, pursuant to which the Portfolio must comply
with certain conditions. This technique involves initially valuing a portfolio
security at its cost and thereafter assuming a constant amortization to
maturity of any discount or premium. It is the normal practice of the
Portfolio to hold portfolio securities to maturity and realize par value
unless such sale or other disposition is mandated by withdrawal requests or
other extraordinary circumstances.
B Income -- Interest income is determined on the basis of interest accrued,
adjusted for amortization of premium or accretion of discount when required
for federal income tax purposes.
C Income Taxes -- The Portfolio is treated as a partnership for Federal tax
purposes. No provision is made by the Portfolio for federal or state taxes on
any taxable income of the Portfolio because each investor in the Portfolio is
ultimately responsible for the payment of any taxes. Since some of the
Portfolio's investors are regulated investment companies that invest all or
substantially all of their assets in the Portfolio, the Portfolio normally
must satisfy the applicable source of income and diversification requirements
(under the Internal Revenue Code), in order for its investors to satisfy them.
The Portfolio will allocate at least annually, among its investors each
investor's distributive share of the Portfolio's net taxable investment
income, net realized capital gains, and any other items of income, gain, loss,
deduction or credit.
D Deferred Organization Expenses -- Costs incurred by the Portfolio in
connection with its organization are being amortized on the straight-line
basis over five years.
E Use of Estimates -- The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported amounts
of income and expense during the reporting period. Actual results could differ
from those estimates.
F Other -- Investment transactions are accounted for on a trade date basis.
G Interim Financial Information -- The interim financial statements relating
to June 30, 1997 and for the six month period then ended have not been audited
by independent certified public accountants, but in the opinion of the
Portfolio's management, reflect all adjustments, consisting only of normal
recurring adjustments, necessary for the fair presentation of the financial
statements.
2 Investment Adviser Fee and Other Transactions with Affiliates
- --------------------------------------------------------------------------------
The investment adviser fee is earned by Boston Management and Research (BMR),
a wholly-owned subsidiary of Eaton Vance Management (EVM), as compensation for
management and investment advisory services rendered to the Portfolio. The fee
is computed at the rate of 1/2 of 1% per annum of the Portfolio's average
daily net assets and amounted to $364,794 for the period ended June 30, 1997.
Except as to Trustees of the Portfolio who are not members of EVM's or BMR's
organization, officers and Trustees receive remuneration for their services to
the Portfolio out of such investment adviser fee. Certain of the officers and
Trustees of the Portfolio are officers and directors/trustees of the above
organizations.
19
<PAGE>
Cash Management Portfolio as of June 30, 1997
NOTES TO FINANCIAL STATEMENTS (Unaudited) CONT'D
3 Line of Credit
------------------------------------------------------------------------------
The Portfolio participates with other portfolios and funds managed by BMR or
EVM and its affiliates in a committed $120 million unsecured line of credit
agreement with a group of banks. The Portfolio may temporarily borrow from the
line of credit to satisfy withdrawal requests or settle investment
transactions. Interest is charged to each participating portfolio or fund
based on its borrowings at an amount above the bank's adjusted certificate of
deposit rate, eurodollar rate or federal funds rate. In addition, a fee
computed at an annual rate of 0.15% on the daily unused portion of the line of
credit is allocated among the participating portfolios and funds at the end of
each quarter. The Portfolio did not have any significant borrowings or
allocated fees during the six months ended June 30, 1997.
4 Investment
------------------------------------------------------------------------------
Purchases and sales (including maturities) of investments, during the period
ended June 30, 1997, exclusive of U.S. Government securities aggregated
$696,987,447 and $753,104,969, respectively. Purchases and sales (including
maturities) of U.S. Government Agency securities aggregated $167,064,983 and
$54,971,167, respectively.
20
<PAGE>
EV Money Market Funds as of June 30, 1997
INVESTMENT MANAGEMENT
<TABLE>
<CAPTION>
EV Mutual Funds Trust
<S> <C>
Officers Independent Trustees
M. Dozier Gardner Donald R. Dwight
President and Trustee President, Dwight Partners, Inc.
Chairman, Newspapers of New England, Inc.
James B. Hawkes
Vice President and Trustee Samuel L. Hayes, III
Jacob H. Schiff Professor of Investment
William H. Ahern, Jr. Banking, Harvard University Graduate School of
Vice President Business Administration
Michael B. Terry Norton H. Reamer
Vice President President and Director, United Asset
Management Corporation
James L. O'Connor
Treasurer John L. Thorndike
Formerly Director, Fiduciary Company Incorporated
Alan R. Dynner
Secretary Jack L. Treynor
Investment Adviser and Consultant
<CAPTION>
Cash Management Portfolio
<S> <C>
Officers Trustees
M. Dozier Gardner Donald R. Dwight
President and Trustee President, Dwight Partners, Inc.
Chairman, Newspapers of New England, Inc.
James B. Hawkes
Vice President and Trustee Samuel L. Hayes, III
Jacob H. Schiff Professor of Investment
Michael B. Terry Banking, Harvard University Graduate School of
Vice President and Business Administration
Portfolio Manager
Norton H. Reamer
James L. O'Connor President and Director, United Asset
Treasurer Management Corporation
Alan R. Dynner John L. Thorndike
Secretary Formerly Director, Fiduciary Company Incorporated
Jack L. Treynor
Investment Adviser and Consultant
</TABLE>
21
<PAGE>
This Page Intentionally Left Blank
<PAGE>
This Page Intentionally Left Blank
<PAGE>
Portfolio Investment Adviser
Boston Management and Research
24 Federal Street
Boston, MA 02110
Fund Administrator
Eaton Vance Management
24 Federal Street
Boston, MA 02110
Principal Underwriter
Eaton Vance Distributors, Inc.
24 Federal Street
Boston, MA 02110
(617) 482-8260
Custodian
Investors Bank & Trust Company
200 Clarendon Street, 16th Floor
Boston, MA 02116
Transfer Agent
First Data Investor Services Group
Attention: Eaton Vance Funds
P.O. Box 5123
Westborough, MA 01581-5123
Eaton Vance Mutual Funds Trust
24 Federal Street
Boston, MA 02110
- --------------------------------------------------------------------------------
This report must be preceded or accompanied by a current prospectus which
contains more complete information on the Fund, including its sales charges and
expenses. Please read the prospectus carefully before you invest or send money.
- --------------------------------------------------------------------------------
MMSRC-8/97
