LANDMARK FUNDS III
N-30B-2, 1995-05-03
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<PAGE>
[Logo] LANDMARK(SM) FUNDS
       Advised by Citibank, N.A.

LANDMARK 
CASH RESERVES

SEMI-ANNUAL
REPORT
February 28, 1995


<PAGE>
- - --------------------------------------------------------------------------------
                          A LETTER TO OUR SHAREHOLDERS
- - --------------------------------------------------------------------------------
Dear Shareholder:

     Although the six months ended  February  28, 1995 were  difficult  for most
financial markets,  short-term investments did quite well. In fact, this was one
of very  few  times in the  history  of the  financial  markets  in  which  cash
equivalent investments  outperformed longer term securities.  Investors in money
market  instruments  enjoyed  correspondingly  higher yields as tighter monetary
policy caused interest rates to rise in a stronger-than-expected economy.

     Throughout the period, the Cash Reserves  Portfolio's  investment  adviser,
Citibank,  N.A., managed the Portfolio in a manner consistent with the objective
stated in the  Fund's  prospectus:  providing  liquidity  and as high a level of
current income as is consistent with the  preservation  of capital.  Through its
investment in the Cash Reserves Portfolio, the Fund seeks to offer an attractive
yield and a competitive  expense ratio by investing in a high-quality  portfolio
of short-term domestic and foreign dollar-denominated money market instruments.

     This  Semi-Annual  Report  reviews  the  Fund  and  Portfolio's  investment
activities and performance  over the past six months,  and provides a summary of
Citibank's  perspective on the financial markets and outlook for the foreseeable
future.  On behalf of the Board of Trustees  of the  Landmark  Funds,  I want to
thank our shareholders for their  participation and support.  We look forward to
serving you in the months and years ahead.


/s/Philip W. Coolidge

Philip W. Coolidge
President
March 20, 1995

Remember that Mutual Fund Shares:
* Are not bank deposits or FDIC insured
* Are not  obligations  of or  guaranteed  by Citibank  or  Citicorp  Investment
  Services
* Are  subject  to investment  risks,  including  possible loss of the principal
  amount invested


TABLE OF CONTENTS
  1   Letter to Shareholders
- - -------------------------------------------------------------------------------
  2   Market Environment
      Fund Snapshot
- - -------------------------------------------------------------------------------
  3   Fund Quotes
      The Portfolio Manager Responds
      Strategy and Outlook
- - -------------------------------------------------------------------------------
  4   Fund Data
      7-Day Yield Comparisons


LANDMARK CASH RESERVES

 5   Statement of Assets and Liabilities
     Statement of Operations
- - -------------------------------------------------------------------------------
 6   Statement of Changes in Net Assets
     Financial Highlights
- - -------------------------------------------------------------------------------
 7   Notes to Financial Statements
- - -------------------------------------------------------------------------------

CASH RESERVES PORTFOLIO
- - -------------------------------------------------------------------------------
 9   Portfolio of Investments
- - -------------------------------------------------------------------------------
11   Statement of Assets and Liabilities
     Statement of Operations
- - -------------------------------------------------------------------------------
12   Statement of Changes in Net Assets
     Financial Highlights
- - -------------------------------------------------------------------------------
13   Notes to Financial Statements

<PAGE>
MARKET ENVIRONMENT

     On February 4, 1994,  the Federal  Reserve Board began to raise  short-term
interest rates in order to slow the growth of the U.S.  economy and forestall an
acceleration  of inflation.  By the end of February  1995,  the results of their
efforts had begun to take effect. As of this writing, the inflation rate remains
stable,  the economy appears to be slowing and long-term  interest rates,  which
often  reflect  investors'   confidence  in  fiscal  and  monetary  policy,  are
moderating from their 1994 highs.


     The road to this relatively  positive state of economic  affairs,  however,
was a rocky one.  Six months  ago,  the  economy  was  growing  faster  than its
productive  capacity  despite five  consecutive  increases in the federal  funds
rate.  Fixed-income  investors  remained  concerned  about the  potential  for a
resurgence  of inflation,  causing most  long-term  prices to fall  sharply.  In
response to these concerns, the Federal Reserve raised short-term interest rates
twice  more--three-quarters  of a percentage point in November and one-half of a
point in February--for a total of seven increases since February 4, 1994. During
that time, the federal funds rate doubled from three percent to six percent.

     Although  higher  short-term  interest  rates put pressure on the prices of
longer term fixed-income  securities,  they had a positive effect on short-term,
cash equivalent investments. At the end of the reporting period, on February 28,
1995,  yields on 3-month U.S.  Treasury bills stood at 5.93%,  27.3% higher than
their 4.66% yields on September 1, 1994, six months earlier.

WEEKLY AVERAGE FEDERAL FUNDS RATE
[THE FOLLOWING DATA IS PRESENTED AS A GRAPH IN THE PRINTED REPORT]

                     Federal Funds 
                     Rate (Effective)
              3/4/94             3.28%
             3/11/94             3.25%
             3/18/94             3.19%
             3/25/94             3.31%
              4/1/94             3.49%
              4/8/94             3.69%
             4/15/94             3.37%
             4/22/94             3.59%
             4/29/94             3.59%
              5/6/94             3.76%
             5/13/94             3.70%
             5/20/94             4.02%
             5/27/94             4.22%
              6/3/94             4.27%
             6/10/94             4.13%
             6/17/94             4.21%
             6/24/94             4.19%
              7/1/94             4.19%
              7/8/94             4.38%
             7/15/94             4.30%
             7/22/94             4.30%
             7/29/94             4.28%
              8/5/94             4.28%
             8/12/94             4.26%
             8/19/94             4.35%
             8/26/94             4.66%
              9/2/94             4.72%
              9/9/94             4.74%
             9/16/94             4.70%
             9/23/94             4.73%
             9/30/94             4.66%
             10/7/94             5.07%
            10/14/94             4.62%
            10/21/94             4.72%
            10/28/94             4.72%
             11/4/94             4.77%
            11/11/94             4.74%
            11/18/94             5.22%
            11/25/94             5.53%
             12/2/94             5.85%
             12/9/94             5.47%
            12/16/94             5.48%
            12/23/94             5.56%
            12/30/94             5.45%
              1/6/95             5.40%
             1/13/95             5.53%
             1/20/95             5.45%
             1/27/95             5.42%
              2/3/95             5.63%
             2/10/95             5.95%
             2/17/95             5.93%
             2/24/95             5.94%


Source: Federal Reserve Stastical Release H15

FUND SNAPSHOT

COMMENCEMENT OF OPERATIONS
August 31, 1984

NET ASSETS AS OF 2/28/95
 $598.5 million

FUND OBJECTIVE
To provide its shareholders with liquidity and as high a level of current income
as is consistent with the preservation of capital.

DIVIDENDS
Accrued daily, paid monthly

BENCHMARKS
o Lipper Taxable Money Market Funds Average
o IBC/Donoghue 1st Tier Taxable  Money Market Funds
    Average

INVESTMENT ADVISER, CASH RESERVES PORTFOLIO
Citibank, N.A.
<PAGE>
FUND QUOTES FROM THE PORTFOLIO MANAGER
"We  periodically  took a more aggressive  maturity stance than some other money
market funds as the market anticipated interest rate increases."

"Our strategy worked. We were able to earn higher yields and maintain  liquidity
with longer dated securities."

"We modestly reduced our holdings of U.S. Treasury  securities in favor of other
money market investments that offered high yields."

THE PORTFOLIO MANAGER RESPONDS
     Although  Citibank fully expected the Federal  Reserve to tighten  monetary
policy further during the six-month  period,  we felt that investors had already
incorporated  higher  interest  rates  into the  marketplace.  Consequently,  we
maintained a longer  average  maturity than most other money market funds during
the period.  This  relatively  aggressive  maturity stance enabled us to capture
incrementally higher yields and earn higher returns for our shareholders.

     We also actively managed the mix of short-term money market  instruments in
the Portfolio. In a rising interest rate environment,  we increased our exposure
to floating-rate  securities  issued by banks and  corporations  that provided a
degree of protection from rising yields.  During most of the period, we employed
a "barbell"  approach to portfolio  management--very  short-term  investments in
time  deposits,  commercial  paper and  repurchase  agreements  were balanced by
longer term investments in U.S. Treasury bills and certificates of deposit. This
approach  enabled  us to lock in higher  yields at the long end of the  maturity
range while keeping cash available for higher yielding  investments at the short
end of the maturity range.

     Finally,  the Board of Trustees of the Landmark Funds  implemented a policy
change during the period. As of January 3, 1995, the Cash Reserves  Portfolio is
restricted  to  investing  only in money market  instruments  rated A1/P1 or its
equivalent   (as   rated  by  a   nationally   recognized   statistical   rating
organization),  the highest credit rating available.  Previously,  the Portfolio
was  permitted  to invest  up to 5% of its  assets  in  A2/P2-rated  securities.
However,  the Portfolio did not choose to exercise this privilege and has had no
exposure to A2/P2-rated securities.

STRATEGY AND OUTLOOK
     Although the Federal Reserve may increase  short-term  interest rates again
if the  economy  grows at an  inflationary  pace,  we  believe  that most of the
increases  are behind  us.  Indeed,  we would not be  surprised  if the  Federal
Reserve  begins to loosen their reins on monetary  policy in the months ahead as
the economy slows to more sustainable levels.

     Citibank's  strategy  looking forward is the same one that we have employed
over  the past six  months:  we  intend  to  adjust  the  average  maturity  and
investment  mix of the  Portfolio  in response to changes in economic and market
conditions. If short-term interest rates begin to fall over the next six months,
we are prepared to lengthen  maturities to maintain higher yields for as long as
possible.  If, on the other hand,  interest  rates begin to rise, we may shorten
maturities to help ensure  participation in higher yielding  investments as they
become available.  In the meantime,  we expect to carefully monitor the economy,
monetary  policy  and  other  factors  that  affect   short-term   money  market
securities.
<PAGE>
FUND DATA All Periods Ended February 28, 1995 (unaudited)

                                                    TOTAL RETURNS
                                            ----------------------------------
                                                                     SINCE
                                             SIX    ONE   FIVE      8/31/84
                                            MONTHS  YEAR  YEARS*  (INCEPTION)*
                                            ------  ----  -----   -----------
Landmark Cash Reserves ...................   2.40%  4.27% 4.62%       6.08%
Lipper Taxable Money Market Funds Average    2.36%  4.10% 4.50%       6.01%

*Average Annual Total Return

7-DAY YIELDS
- - ------------
Annualized Current       5.54%
Effective                5.69%

The Annualized  Current 7-Day Yield  reflects the amount of income  generated by
the  investment  during that  seven-day  period and  assumes  that the income is
generated each week over a 365 day period. The yield is shown as a percentage of
the investment.

The  Effective  7-Day Yield is calculated  similarly,  but when  annualized  the
income earned by the investment  during that  seven-day  period is assumed to be
reinvested.

The  effective  yield is slightly  higher than the current  yield because of the
compounding effect of this assumed reinvestment.

7-DAY YIELD COMPARISONS

As the graph  illustrates,  Landmark Cash Reserves  generally  provided a higher
annualized seven-day yield than the average of comparable Money Market Funds, as
published in IBC/Donoghue's Money Fund Report over most of the one year period.
<PAGE>
COMPARISON OF 7-DAY YIELD FOR LANDMARK CASH RESERVES VS.  IBC/DONOGHUE  1ST TIER
TAXABLE MONEY MARKET FUNDS AVERAGE
[THE FOLLOWING DATA IS PRESENTED AS A GRAPH IN THE PRINTED REPORT]
                                 CASH RESERVES
                                                              IBC/Donoghue
                                                               1st. Tier
                                      Landmark Cash       Taxable Money Market
                                        Reserves              Funds Average
                 3/1/94                   2.78%                   2.70%
                 3/8/94                   2.82%                   2.73%
                3/15/94                   2.82%                   2.76%
                3/22/94                   2.91%                   2.79%
                3/29/94                   3.02%                   2.84%
                 4/5/94                   3.08%                   2.89%
                4/12/94                   3.02%                   2.93%
                4/19/94                   3.06%                   2.97%
                4/26/94                   3.18%                   3.06%
                 5/3/94                   3.19%                   3.10%
                5/10/94                   3.24%                   3.17%
                5/17/94                   3.38%                   3.27%
                5/24/94                   3.58%                   3.40%
                5/31/94                   3.63%                   3.45%
                 6/7/94                   3.63%                   3.51%
                6/14/94                   3.65%                   3.54%
                6/21/94                   3.73%                   3.58%
                6/28/94                   3.75%                   3.59%
                 7/5/94                   3.77%                   3.66%
                7/12/94                   3.79%                   3.70%
                7/19/94                   3.87%                   3.74%
                7/26/94                   3.90%                   3.76%
                 8/2/94                   3.92%                   3.78%
                 8/9/94                   3.90%                   3.80%
                8/16/94                   3.90%                   3.83%
                8/23/94                   4.15%                   3.95%
                8/30/94                   4.22%                   4.00%
                 9/6/94                   4.25%                   4.03%
                9/13/94                   4.23%                   4.07%
                9/20/94                   4.26%                   4.10%
                9/27/94                   4.28%                   4.14%
                10/4/94                   4.34%                   4.20%
               10/11/94                   4.31%                   4.24%
               10/18/94                   4.33%                   4.28%
               10/25/94                   4.27%                   4.31%
                11/1/94                   4.40%                   4.36%
                11/8/94                   4.27%                   4.39%
               11/15/94                   4.43%                   4.46%
               11/22/94                   4.74%                   4.68%
               11/29/94                   4.93%                   4.76%
                12/6/94                   5.21%                   4.85%
               12/13/94                   4.96%                   4.94%
               12/20/94                   4.98%                   5.04%
               12/27/94                   5.04%                   5.12%
                 1/3/95                   5.05%                   5.18%
                1/10/95                   5.02%                   5.19%
                1/17/95                   4.98%                   5.19%
                1/24/95                   5.06%                   5.20%
                1/31/95                   5.21%                   5.24%
                 2/7/95                   5.37%                   5.35%
                2/14/95                   5.47%                   5.40%
                2/21/95                   5.54%                   5.46%
                2/28/95                   5.53%                   5.44%


Notes: The Fund seeks to maintain a stable $1.00 per share price, although there
is no assurance that this will be so on a continuing  basis. Fund sharse are not
insured or  guaranteed  by the U.S.  Government.  Yields and total  returns will
fluctuate and past  performance is no guarantee of future results.  Total return
figures include  reinvestment  of dividends.  Returns and yields reflect certain
voluntary fee waivers.  If the waivers were not in place, the Fund's returns and
yields would have been lower.
<PAGE>

 Landmark Cash Reserves

 STATEMENT OF ASSETS AND LIABILITIES February 28, 1995 (unaudited)

<TABLE>
<S>                                                                                               <C>
ASSETS:
Investment in Cash Reserves Portfolio, at value (Note 1).....................................     $600,722,285

Receivable for shares of beneficial interest sold............................................           18,500
                                                                                                  ------------
    Total assets.............................................................................      600,740,785
                                                                                                  ------------
LIABILITIES:
Dividends Payable............................................................................        1,894,525
Payable to affiliate-Shareholder Servicing Agents' fees (Note 3B)............................          100,459
Payable for shares of beneficial interest repurchased........................................           13,483
Accrued expenses and other liabilities.......................................................          234,626
                                                                                                  ------------
    Total liabilities........................................................................        2,243,093
                                                                                                  ------------

NET ASSETS for 598,497,692 shares of beneficial interest outstanding.........................     $598,497,692
                                                                                                  ============
NET ASSETS CONSIST OF:
Paid-in capital..............................................................................     $598,497,692
                                                                                                  ============
NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE PER SHARE  .............................            $1.00
                                                                                                          ====
</TABLE>
<TABLE>
<CAPTION>
 Landmark Cash Reserves

 STATEMENT OF OPERATIONS
 For the Six Months Ended February 28, 1995 (unaudited)

<S>                                                                         <C>                   <C>
INVESTMENT INCOME (Note 1A):
Income from Cash Reserves Portfolio........................................  $14,024,119
Allocated Expenses from Cash Reserves Portfolio............................     (253,204)
                                                                             -----------

  Net investment income from Cash Reserves Portfolio.......................                        $13,770,915

EXPENSES:
Shareholder Servicing Agents' fees (Note 3B)............................... $  1,011,201
Administrative fees (Note 3A)..............................................      632,001
Distribution fees (Note 4).................................................      126,400
Shareholder reports........................................................       16,170
Trustee fees...............................................................       11,654
Custodian fees ............................................................       10,011
Transfer agent fees........................................................        6,000
Auditing fees..............................................................        5,400
Legal fees.................................................................        4,878
Miscellaneous..............................................................       34,983
                                                                              ----------
  Total expenses...........................................................    1,858,698
  Less aggregate amount waived by Shareholder
    Servicing Agents (Note 3B).............................................     (336,909)
                                                                              ----------
    Net expenses...........................................................                          1,521,789
                                                                                                   -----------
    Net investment income..................................................                        $12,249,126
                                                                                                   ===========

See notes to financial statements
</TABLE>
<PAGE>

 Landmark Cash Reserves

 STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
                                                                  SIX MONTHS ENDED
                                                                  FEBRUARY 28, 1995          YEAR ENDED
                                                                     (UNAUDITED)           AUGUST 31, 1994
                                                                  ----------------        ----------------
<S>                                                                <C>                    <C>
FROM INVESTMENT ACTIVITIES:
Net investment income, declared as dividends to shareholders
  (Note 2)..................................................       $  12,249,126           $  14,289,507
                                                                   =============           =============
TRANSACTIONS IN SHARES OF BENEFICIAL INTEREST
  AT NET ASSET VALUE OF $1.00 PER SHARE (NOTE 5):
Proceeds from sale of shares.................................      $ 477,372,453           $ 764,152,050
Net asset value of shares issued to shareholders
  from reinvestment of dividends.............................          3,016,268               5,001,747
Cost of shares repurchased ..................................       (327,490,641)           (794,312,393)
                                                                   -------------           -------------
NET INCREASE (DECREASE) IN NET ASSETS .......................        152,898,080             (25,158,596)

NET ASSETS:
Beginning of period..........................................        445,599,612             470,758,208
                                                                   -------------           -------------
End of period................................................      $ 598,497,692           $ 445,599,612
                                                                   =============           =============
</TABLE>




 Landmark Cash Reserves

 FINANCIAL HIGHLIGHTS
<TABLE>
                                   
                                               SIX MONTHS ENDED                  YEAR ENDED AUGUST 31,
                                              FEBRUARY 28, 1995    ----------------------------------------------------
                                                 (UNAUDITED)       1994        1993       1992        1991        1990
                                                --------------     -----      ------     ------      ------      ------
<S>                                            <C>               <C>         <C>         <C>        <C>         <C>     
Net Asset Value, beginning of period           $  1.00000        $1.00000    $1.00000    $1.00000   $1.00000    $1.00000
Net investment income..............               0.02380         0.03137     0.02671     0.04010    0.06606     0.07785
Less dividends from net investment income        (0.02380)       (0.03137)   (0.02671)   (0.04010)  (0.06606)   (0.07785)
                                               ----------        --------    --------    --------   --------    --------
Net Asset Value, end of period.....            $  1.00000        $1.00000    $1.00000    $1.00000   $1.00000    $1.00000
                                               ==========        ========    ========    ========   ========    ========
RATIOS/SUPPLEMENTAL DATA:
Net Assets, end of period (000 omitted)        $  598,498        $445,600    $470,758    $498,447   $580,052    $413,756
Ratio of expenses to average net assets<F1>         0.70%<F2>       0.69%       0.69%       0.67%      0.61%       0.73%
Ratio of net investment income to
  average net assets...............                 4.85%<F2>       3.12%       2.67%       4.05%      6.48%       7.80%
Total return.......................                 2.40%<F3>       3.18%       2.70%       4.13%      6.81%       8.04%

  Note: If agents of the Fund and agents of Cash Reserves Portfolio had not waived all or a portion of their fees during the periods
        indicated, the net investment income per share and the ratios would have been as follows:

    Net investment income per share              $0.02264        $0.02840    $0.02381    $0.03753   $0.06025    $0.07466

    Ratios:
    Expenses to average net assets<F1>              0.98%<F2>       0.99%       0.98%       0.93%      0.94%       0.97%
    Net investment income to average net assets     4.57%<F2>       2.82%       2.38%       3.79%      5.91%       7.48%

<FN>
<F1>Includes the Fund's share of Cash Reserves Portfolio's allocated expenses.
<F2>Annualized
<F3>Not Annualized
</TABLE>

See notes to financial statements
<PAGE>
 Landmark Cash Reserves

 NOTES TO FINANCIAL STATEMENTS (unaudited)

(1) SIGNIFICANT ACCOUNTING POLICIES
Landmark Cash Reserves (the "Fund") is a separate diversified series of Landmark
Funds III (the "Trust"), a Massachusetts business trust. The Trust is registered
under the Investment Company Act of 1940, as amended,  as an open-end management
investment  company.  The Fund  invests  all of its  investable  assets  in Cash
Reserves Portfolio (the "Portfolio"),  a management investment company for which
Citibank,  N.A.  ("Citibank") serves as investment  adviser.  The Landmark Funds
Broker-Dealer  Services,  Inc.  ("LFBDS") acts as the Trust's  Administrator and
Distributor.   Citibank  also  serves  as  Sub-Administrator  and  makes  shares
available to customers through various Shareholder Servicing Agents.

The  Trust  seeks to  achieve  the  Fund's  investment  objective  of  providing
liquidity  and as high a level  of  current  income  as is  consistent  with the
preservation  of  capital  by  investing  all of its  investable  assets  in the
Portfolio,  an open-end,  diversified  management  investment company having the
same investment objective as the Fund. The value of such investment reflects the
Fund's proportionate  interest (30.5% at February 28, 1995) in the net assets of
the Portfolio.

The  financial   statements  of  the  Portfolio,   including  the  portfolio  of
investments,  are  contained  elsewhere  in this  report  and  should be read in
conjunction with the Fund's financial statements.

The significant  accounting  policies  consistently  followed by the Fund are in
conformity with generally accepted accounting principles and are as follows:

A. INVESTMENT INCOME -- The Fund earns income, net of Portfolio expenses,  daily
on its investment in the Portfolio.

B. FEDERAL  TAXES -- The Fund's  policy is to comply with the  provisions of the
Internal  Revenue  Code  available  to  regulated  investment  companies  and to
distribute to shareholders all of its taxable income.  Accordingly, no provision
for federal income or excise tax is necessary.

C.  EXPENSES -- The Fund bears all costs of its  operations  other than expenses
specifically assumed by Citibank and LFBDS.  Expenses incurred by the Trust with
respect to any two or more Funds in the series are  allocated in  proportion  to
the average net assets of each fund,  except when allocations of direct expenses
to each fund can otherwise be made fairly.  Expenses directly  attributable to a
fund are charged to that fund.

D. OTHER -- All the net  investment  income of the  Portfolio is  allocated  pro
rata,  based on  respective  ownership  interests,  among the Fund and the other
investors in the Portfolio at the time of such determination.

(2) DIVIDENDS
The net income of the Fund is determined  once daily,  as of 2:00 p.m., New York
City time,  and all of the net income of the Fund so determined is declared as a
dividend to shareholders of record at the time of such determination.  Dividends
are distributed in the form of additional shares of the Fund or, at the election
of the  shareholder,  in cash  (subject  to the  policies  of the  shareholder's
Shareholder Servicing Agent) on or prior to the last business day of the month.

(3) ADMINISTRATIVE SERVICES PLAN
The Trust has adopted an  Administrative  Services Plan which  provides that the
Trust, on behalf of each Fund, may obtain the services of an Administrator,  one
or more Shareholder  Servicing Agents, and other Servicing Agents, and may enter
into agreements  providing for the payment of fees for such services.  Under the
Trust's  Administrative  Services  Plan,  the  aggregate  of the fee paid to the
Administrator  from the Fund, the fees paid to the Shareholder  Servicing Agents
from the Fund under such Plan and the Basic  Distribution Fee paid from the Fund
to the  Distributor  under the  Distribution  Plan may not  exceed  0.70% of the
Fund's  average  daily  net  assets  on  an  annualized  basis  for  the  Fund's
then-current fiscal year.

A.  ADMINISTRATIVE  FEES  --  Under  the  terms  of an  Administrative  Services
Agreement,  LFBDS  is  entitled  to an  administrative  fee from  the  Fund,  as
compensation for overall administrative  services and general office facilities,
which is accrued  daily and paid  monthly at an annual  rate of 0.25% of average
daily net assets.  The  administrative  fees  amounted to $632,001,  for the six
months ended February 28, 1995. Citibank acts as Sub-Administrator  and performs
such duties and receives  such  compensation  from LFBDS as from time to time is
agreed to by LFBDS and Citibank.  The Fund pays no compensation  directly to any
Trustee or any officer who is  affiliated  with the  Administrator,  all of whom
receive  remuneration  for their services to the Fund from the  Administrator or
its  affiliates.  Certain of the officers and a Trustee of the Fund are officers
and a director of the Administrator or its affiliates.

B.  SHAREHOLDER  SERVICING  AGENT FEES -- The Trust,  on behalf of the Fund, has
entered into shareholder  servicing  agreements with each Shareholder  Servicing
Agent pursuant to which the Shareholder Servicing Agent acts as an agent for its
customers  and  provides  other  related  services.  For  their  services,  each
Shareholder  Servicing  Agent  receives  fees from the  Fund,  which may be paid
periodically,  which may not exceed,  on an annualized basis, an amount equal to
0.40% of the average  daily net assets of the Fund  represented  by shares owned
during  the period for which  payment is being made by  investors  for whom such
Shareholder Servicing Agent maintains a servicing relationship.  The Shareholder
Servicing  Agent fees amounted to $1,011,201,  of which $336,909 was voluntarily
waived for the six months ended  February 28, 1995.

(4)  DISTRIBUTION  FEES
The Trust has  adopted a Plan of  Distribution  pursuant to Rule 12b-1 under the
Investment  Company Act of 1940, as amended,  in which the Fund  reimburses  the
Distributor for expenses  incurred or anticipated in connection with the sale of
shares of the Fund,  not to exceed an annual rate of 0.10% of the Fund's average
daily net assets.  The  Distributor  may also receive an additional fee from the
Fund not to exceed 0.10% of the Fund's average daily net assets in  anticipation
of, or as reimbursement for, advertising expenses incurred by the Distributor in
connection  with the sale of shares of the Fund. No payments of such  additional
fees  have  been  made to date.  Under the  Administrative  Services  Plan,  the
distribution fees were computed at an annual rate of 0.05% of the Fund's average
daily net assets. The distribution fees amounted to $126,400, for the six months
ended February 28, 1995.

(5) SHARES OF BENEFICIAL INTEREST
The  Declaration  of Trust permits the Trustees to issue an unlimited  number of
full and fractional Shares of Beneficial Interest (without par value).

(6) INVESTMENT TRANSACTIONS
Increases  and decreases in the Fund's  investment  in the Portfolio  aggregated
$319,790,285 and $179,865,569,  respectively,  for the six months ended February
28, 1995.
<PAGE>
CASH RESERVES PORTFOLIO

PORTFOLIO OF INVESTMENTS February 28, 1995 (unaudited)

                                                  PRINCIPAL
                                                   AMOUNT
ISSUER                                            (000'S)              VALUE
- - --------------------------------------------------------------------------------
BANK NOTES--5.2%
Bank of New York
  6.90%, due 11/28/95 ..................        $    50,000         $49,957,968
Nationsbank, Texas
  7.55%, due 1/9/96 ....................             25,000          25,007,277
Northern Trust Bank Co.
 5.75%, due 7/20/95 ....................             28,000          27,994,808
                                                                 --------------
                                                                    102,960,053
                                                                 --------------

CERTIFICATES OF DEPOSIT
(EURODOLLARS)--3.4%
Barclays Bank
6.94%, due 10/17/95 ....................             67,000          66,982,682
                                                                 --------------

CERTIFICATES OF DEPOSIT
(YANKEE)--24.5%
Amro
  6.08%, due 3/30/95 ...................             23,000          23,001,100
Bank of Montreal
  6.05%, due 4/17/95 ...................             40,000          40,000,259
Bank of Nova Scotia
  6.09%, due 3/30/95 ...................             90,000          90,002,381
Dai Ichi Kangyo, New York
  6.22%, due 5/8/95.....................             55,000          55,001,023
Fuji Bank,
  6.05%, due 3/24/95....................            100,000         100,000,000
Mitsubishi Bank, New York
  7.35%, due 12/6/95....................             50,000          50,000,000
  7.625%, due 12/29/95..................             25,000          25,036,901

Societe Generale Bank
  6.00%, due 3/1/95.....................             50,000          50,000,000
  7.41%, due 1/23/96....................             25,000          25,002,119
Sumitomo Bank
  6.20%, due 5/22/95....................             25,000          25,000,561
                                                                 --------------
                                                                    483,044,344
                                                                 --------------

COMMERCIAL PAPER--9.1%
Bankers Trust Co., New York
  6.05%, due 3/28/95....................             50,000          49,773,125
Ford Motor Credit Corp.
  6.05%, due 3/28/95....................             85,000          84,614,313
General Electric Capital Co.
  6.73%, due 10/16/95...................             25,000          23,929,743
Merrill Lynch & Co. Inc.
  5.98%, due 3/10/95....................             20,000          19,970,100
                                                                 --------------
                                                                    178,287,281
                                                                 --------------

FLOATING RATE NOTES--27.4%
Bank One, Chicago
  6.15%, due 2/12/96....................             50,000          50,000,000
Bankers Trust Co., New York
  6.17%, due 6/20/95....................             30,000          29,995,624
Boatmens Bank Southern Missouri
  6.14%, due 8/3/95.....................             50,000          49,995,753
Boatmens First National Bank, Kansas
  6.19%, due 2/14/96....................             40,000          40,000,000
FCC National Bank, Delaware
  6.17%, due 12/20/95...................             50,000          50,000,000
General Electric Capital Co.
  6.115%, due 2/16/96...................             50,000          49,983,077
  6.14%, due 5/22/95....................             25,000          25,000,000
Key Bank, N.Y.
  6.09%, due 9/26/95....................             50,000          49,977,096
Pittsburgh National Bank
  6.04%, due 7/26/95....................             70,000          69,971,808
Royal Bank of Canada
  6.24%, due 6/8/95.....................             25,000          25,000,000
Society National Bank
  6.09%, due 9/6/95.....................             50,000          49,977,216
Svenska Handelsbanken
  6.05%, due 6/28/95....................             50,000          49,993,200
                                                                 --------------
                                                                    539,893,774
                                                                 --------------

TIME DEPOSIT--9.6%
Dai Ichi Kangyo, New York
  6.063%, due 3/1/95 ...................             40,000          40,000,000
NationsBank Corp.
  6.063%, due 3/1/95....................             70,000          70,000,000
State Street Bank, Cayman Islands
  6.125%, due 3/1/95....................             78,335          78,335,000
                                                                 --------------
                                                                    188,335,000
                                                                 --------------

UNITED STATES AGENCY--3.1%
Federal National Mortgage Association
  6.00%, due 3/2/95.....................             20,500          20,496,583
  6.86%, due 2/28/96....................             40,000          39,965,719
                                                                 --------------
                                                                     60,462,302
                                                                 --------------

UNITED STATES GOVERNMENT--9.7%
United States Treasury Bills
  5.19%, due 7/27/95....................             50,000          48,933,167
  5.355%, due 8/24/95...................            145,000         141,202,067
                                                                 --------------
                                                                    190,135,234
                                                                 --------------


REPURCHASE AGREEMENT--8.9%
Salomon Repurchase Agreement
  6.13% and 6.20%, dated 2/28/95,
  due 3/1/95 proceeds
  at maturity $175,029,896
  (secured by $211,021,000
  U.S. Treasury Note, 6.25%,
  due 8/15/23)..........................            175,000         175,000,000
                                                                 --------------


TOTAL INVESTMENTS
   AT AMORTIZED COST....................             100.9%       1,985,100,670
OTHER ASSETS, LESS LIABILITIES..........              (0.9%)        (17,215,405)
                                                     ------      --------------
NET ASSETS..............................             100.0%      $1,967,885,265
                                                     ======      ==============

See notes to financial statements
<PAGE>
<TABLE>
CASH RESERVES PORTFOLIO

STATEMENT OF ASSETS AND LIABILITIES February 28, 1995 (unaudited)

<S>                                                                                             <C>
ASSETS:
Investments at value (Note 1A)......................................................            $1,985,100,670
Cash................................................................................                       410
Interest receivable.................................................................                 8,275,010
Deferred organization expenses (Note 1E)............................................                     2,117
                                                                                                --------------
    Total assets....................................................................            $1,993,378,207
                                                                                                --------------
LIABILITIES:
Payable for investments purchased...................................................                25,335,382
Payable to affiliate--investment advisory fee (Note 2A).............................                    51,757
Accrued expenses and other liabilities..............................................                   105,803
                                                                                                --------------
    Total liabilities...............................................................                25,492,942
                                                                                                --------------
NET ASSETS .........................................................................            $1,967,885,265
                                                                                                ==============
REPRESENTED BY:
Paid-in capital for beneficial interests............................................            $1,967,885,265
                                                                                                ==============
</TABLE>

Cash Reserves Portfolio

<TABLE>
STATEMENT OF OPERATIONS
For the Six Months Ended February 28, 1995 (unaudited)

<S>                                                                          <C>                   <C>
INTEREST INCOME (Note 1B)..............................................                            $56,663,200

EXPENSES:
Investment advisory fees (Note 2A).....................................      $ 1,541,592
Administrative fees (Note 2B)..........................................          513,864
Custodian fees.........................................................          300,442
Auditing fees..........................................................           20,800
Trustees fees..........................................................           20,621
Legal fees.............................................................            7,635
Amortization of organization expenses (Note 1E)........................            5,593
Miscellaneous..........................................................           74,249
                                                                              ----------
  Total expenses.......................................................        2,484,796

  Less aggregate amount waived by Investment Adviser and
    Administrator (Notes 2A and 2B)....................................       (1,457,066)
                                                                              ----------
  Net expenses.........................................................                              1,027,730
                                                                                                   -----------
  Net investment income................................................                            $55,635,470
                                                                                                   ===========
See notes to financial statements
</TABLE>
<PAGE>
Cash Reserves Portfolio

STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
                                                                         SIX MONTHS ENDED
                                                                         FEBRUARY 28, 1995                YEAR ENDED
                                                                            (UNAUDITED)                 AUGUST 31, 1994
                                                                         ----------------              -----------------

<S>                                                                      <C>                           <C>
INCREASE (DECREASE) IN NET ASSETS FROM:
OPERATIONS:
Net investment income............................................        $     55,635,470               $     46,640,474
                                                                         ----------------               ----------------

CAPITAL TRANSACTIONS:
Proceeds from contributions......................................          10,786,097,742                 11,522,208,314
Value of withdrawals.............................................         (11,021,208,534)               (10,202,958,307)
                                                                         ----------------               ----------------
Net increase (decrease) in net assets from capital transaction...            (235,110,792)                 1,319,250,007
                                                                         ----------------               ----------------

NET INCREASE (DECREASE) IN NET ASSETS ...........................            (179,475,322)                 1,365,890,481
NET ASSETS:
Beginning of period..............................................           2,147,360,587                    781,470,106
                                                                         ----------------               ----------------
End of period....................................................        $  1,967,885,265               $  2,147,360,587
                                                                         ================               ================
</TABLE>


Cash Reserves Portfolio

FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
                                                                                                                       MAY 3, 1990
                                      SIX MONTHS ENDED                 YEAR ENDED AUGUST 31,                         (COMMENCEMENT
                                      FEBRUARY 28, 1995   ------------------------------------------------------   OF OPERATIONS) TO
                                         (UNAUDITED)        1994             1993           1992          1991     AUGUST 31, 1990
                                      -----------------     ----             ----           ----          ----     -----------------
<S>                                       <C>             <C>              <C>            <C>           <C>            <C>
RATIOS/SUPPLEMENTAL DATA:
Net assets (000 omitted) ...........      $1,967,885      $2,147,361       $781,470       $901,024      $847,811       $415,400
Ratio of expenses to average
  net assets .......................           0.10%<F1>       0.11%          0.20%          0.25%         0.25%          0.26%<F1>
Ratio of net investment income to
  average net assets................           5.41%<F1>       3.87%          3.15%          4.42%         6.75%          8.01%<F1>
  Note: If agents of the Portfolio had not voluntarily waived a portion of their fees for the periods indicated, the ratios would
    have been as follows:
  Ratios:
  Ratio of expenses to average net assets      0.24%<F1>       0.24%          0.25%          0.25%         0.25%          0.26%<F1>
  Net investment income to average net
  assets............................           5.27%<F1>       3.74%          3.10%          4.42%         6.75%          8.01%<F1>

<FN>
<F1> Annualized

See notes to financial statements
</TABLE>
<PAGE>

Cash Reserves Portfolio

NOTES TO FINANCIAL STATEMENTS (unaudited)

(1) SIGNIFICANT ACCOUNTING POLICIES
Cash  Reserves   Portfolio  (the  "Portfolio")  is  registered  under  the  U.S.
Investment Company Act of 1940, as amended, as a no-load, diversified,  open-end
management  investment  company which was organized as a trust under the laws of
the State of New York.  The  Declaration  of Trust permits the Trustees to issue
beneficial interests in the Portfolio. Signature Financial Group (Grand Cayman),
Ltd. ("SFG") acts as the Portfolio's Administrator and Citibank, N.A.
("Citibank") acts as the Investment Adviser.

The significant  accounting policies  consistently followed by the Portfolio are
in conformity  with U.S.  generally  accepted  accounting  principles and are as
follows:

A. VALUATION OF INVESTMENTS -- Money market  instruments are valued at amortized
cost,  which the Trustees have determined in good faith  constitutes fair value.
This method  involves  valuing a portfolio  security at its cost and  thereafter
assuming a constant  amortization  to maturity of any  discount or premium.  The
Portfolio's use of amortized cost is subject to the Portfolio's  compliance with
certain conditions as specified under Rule 2a-7 of the Investment Company Act of
1940.

B. INTEREST INCOME AND EXPENSES -- Interest income consists of interest  accrued
and discount earned  (including both original issue and market  discount) on the
investments of the Portfolio,  accrued ratably to the date of maturity,  plus or
minus  net  realized  gain or loss,  if any,  on  investments.  Expenses  of the
Portfolio are accrued daily.

C. U.S. FEDERAL INCOME TAXES -- The Portfolio is considered a partnership  under
the U.S.  Internal  Revenue Code.  Accordingly,  no provision for federal income
taxes is necessary.

D.  REPURCHASE  AGREEMENTS  -- It is the policy of the  Portfolio to require the
custodian  bank to take  possession,  to have legally  segregated in the Federal
Reserve  Book Entry System or to have  segregated  within the  custodian  bank's
vault,  all  securities  held as collateral  in support of repurchase  agreement
investments.  Additionally, procedures have been established by the Portfolio to
monitor,  on a daily  basis,  the  market  value of the  repurchase  agreement's
underlying investments to ensure the existence of a proper level of collateral.

E.  DEFERRED  ORGANIZATION  EXPENSES -- Expenses  incurred by the  Portfolio  in
connection with its organization have been deferred and are being amortized on a
straight-line basis not to exceed five years.

F. OTHER -- Purchases and maturities and sales of money market  instruments  are
accounted for on the date of the transaction.

(2) INVESTMENT ADVISORY FEE AND ADMINISTRATIVE FEE
A. INVESTMENT ADVISORY FEE -- The investment  advisory fee paid to Citibank,  as
compensation for overall investment management services, amounted to $1,541,592,
of which $943,202 was  voluntarily  waived for the six months ended February 28,
1995. The investment  advisory fee is computed at an annual rate of 0.15% of the
Portfolio's average daily net assets.

B.  ADMINISTRATIVE  FEE  --  Under  the  terms  of  an  Administrative  Services
Agreement, the administrative fee paid to the Administrator, as compensation for
overall  administrative  services and general office facilities,  is computed at
the  annual  rate of 0.05% of the  Portfolio's  average  daily net  assets.  The
administrative fee amounted to $513,864, all of which was voluntarily waived for
the six months ended  February  28, 1995.  The  Portfolio  pays no  compensation
directly  to  any  Trustee  or  to  any  officer  who  is  affiliated  with  the
Administrator,  all of whom  receive  remuneration  for  their  services  to the
Portfolio from the Administrator or its affiliates.  Certain of the officers and
a Trustee of the Portfolio are officers and a director of the  Administrator  or
its affiliates.

(3) INVESTMENT TRANSACTIONS
Purchases  and  maturities  and  sales of money  market  instruments  aggregated
$76,662,967,372  and  $76,886,693,668,  respectively,  for the six months  ended
February 28, 1995.

(4) LINE OF CREDIT
The Portfolio, along with other Landmark Funds, entered into an agreement with a
bank  which  allows  the Funds  collectively  to borrow  up to $40  million  for
temporary or emergency purposes.  Interest on borrowings,  if any, is charged to
the specific  fund  executing  the  borrowing  at the base rate of the bank.  In
addition,  the $15 million  committed  portion of the line of credit  requires a
quarterly  payment of a commitment fee based on the average daily unused portion
of the  line  of  credit.  For the six  months  ended  February  28,  1995,  the
commitment  fee allocated to the Portfolio was $9,388.  Since the line of credit
was established, there have been no borrowings.

<PAGE>
- - ------------------------------------------------------------------------------
SHAREHOLDER SERVICING AGENTS
- - ------------------------------------------------------------------------------

FOR CITIBANK NEW YORK RETAIL BANKING AND
BUSINESS AND PROFESSIONAL CUSTOMERS:
Citibank, N.A.
450 West 33rd Street, New York, NY 10001
(212) 564-3456 or (800) 846-5300

FOR CITIGOLD CUSTOMERS:
Citigold
P.O. Box 5130, New York, NY 10126-5130
Call Your Citigold Executive or (212) 974-0900 or (800) 285-1701

FOR CITIBANK PRIVATE BANKING CLIENTS:
Citibank, N.A.
The Citibank Private Bank
153 East 53rd Street, New York, NY 10043
Call Your Citibank Private Banking Account Officer,
Investment Specialist or (212) 559-5959

FOR CITIBANK GLOBAL ASSET MANAGEMENT CLIENTS:
Citibank, N.A.
Citibank Global Asset Management
153 East 53rd Street, New York, NY 10043
(212) 559-7117

FOR CITIBANK NORTH AMERICAN INVESTOR SERVICES CLIENTS:
Citibank, N.A.
111 Wall Street, New York, NY 10043
Call Your Account Manager or (212) 657-9100

FOR CITICORP INVESTMENT SERVICES CUSTOMERS:
Citicorp Investment Services
One Court Square, Long Island City, NY 11120
Call Your Investment Consultant or (800) 846-5200
(212) 736-8170 in New York City

[Logo] LANDMARK
       FUNDS

MONEY MARKET FUNDS:
Cash Reserves
Premium Liquid Reserves
Institutional Liquid Reserves

U.S. Treasury Reserves
Premium U.S. Treasury Reserves
Institutional U.S. Treasury Reserves

Tax Free Reserves
California Tax Free Reserves
Connecticut Tax Free Reserves
New York Tax Free Reserves

STOCK & BOND FUNDS:
U.S. Government Income Fund
Intermediate Income Fund
National Tax Free Income Fund
New York Tax Free Income Fund

Balanced Fund
Equity Fund
International Equity Fund
Small Cap Equity Fund

<PAGE>
TRUSTEES AND OFFICERS
Philip W. Coolidge*, President
H. B. Alvord
C. Oscar Morong, Jr.
E. Kirby Warren

SECRETARY AND TREASURER
James B. Craver*

ASSISTANT TREASURER
Barbara M. O'Dette*

ASSISTANT SECRETARY
Molly S. Mugler*
*Affiliated Person of Administrator and Distributor


- - --------------------------------|--|-------------------------------------------

INVESTMENT ADVISER
(OF CASH RESERVES PORTFOLIO)
Citibank, N.A.
153 East 53rd Street, New York, NY 10043

ADMINISTRATOR AND DISTRIBUTOR
The Landmark Funds Broker-Dealer Services, Inc.
6 St. James Avenue, Boston, MA 02116
(617) 423-1679

TRANSFER AGENT AND CUSTODIAN  
State Street Bank and Trust Company 
225 Franklin Street, Boston, MA 02110

AUDITORS
Price Waterhouse LLP 
160 Federal Street, Boston, MA 02110 

LEGAL COUNSEL 
Bingham, Dana & Gould 
150 Federal Street, Boston, MA 02110 


- - --------------------------------|--|-------------------------------------------

SHAREHOLDER SERVICING AGENTS 
(See Inside Cover)

This report is prepared for the  information of  shareholders.  It is authorized
for  distribution to prospective  investors only when preceded or accompanied by
an effective prospectus.


This Report is Prepared & Printed on Recycled Paper(Recycle Logo)
MM/CR/S/95

<PAGE>
[LOGO]  LANDMARK(SM) FUNDS
            Advised by Citibank, N.A.



            LANDMARK
            U.S. TREASURY
            RESERVES



            SEMI-ANNUAL
            REPORT
            February 28, 1995
                                                                               
<PAGE>
- - --------------------------------------------------------------------------------
                          A LETTER TO OUR SHAREHOLDERS
- - --------------------------------------------------------------------------------
Dear Shareholder:

     Although the six months ended  February  28, 1995 were  difficult  for most
financial markets,  short-term investments did quite well. In fact, this was one
of very  few  times in the  history  of the  financial  markets  in  which  cash
equivalent investments  outperformed longer term securities.  Investors in money
market  instruments  enjoyed  correspondingly  higher yields as tighter monetary
policy caused interest rates to rise in a stronger-than-expected economy.

     Throughout the period,  the U.S. Treasury Reserves  Portfolio's  investment
adviser,  Citibank,  N.A., managed the Portfolio in a manner consistent with the
objective  stated in the Fund's  prospectus:  providing  liquidity and as high a
level of current income from U.S.  Government  obligations as is consistent with
the  preservation  of  capital.  Through  its  investment  in the U.S.  Treasury
Reserves Portfolio,  the Fund seeks to offer an attractive yield by investing in
a high-quality  investment portfolio consisting exclusively of securities backed
by the full faith and credit of the U.S. Treasury.

     This  Semi-Annual  Report  reviews  the  Fund  and  Portfolio's  investment
activities and performance  over the past six months,  and provides a summary of
Citibank's  perspective on the financial markets and outlook for the foreseeable
future.  On behalf of the Board of Trustees  of the  Landmark  Funds,  I want to
thank our shareholders for their  participation and support.  We look forward to
serving you in the months and years ahead.

/s/ Philip W. Coolidge
    Philip W. Coolidge

President
March 20, 1995

Remember that Mutual Fund Shares:
* Are not bank deposits or FDIC insured
* Are not  obligations  of or  guaranteed  by Citibank  or  Citicorp  Investment
  Services
* Are  subject  to  investment risks,  including possible  loss of the principal
  amount invested

<PAGE>
TABLE OF CONTENTS

1   Letter to Shareholders
- - -----------------------------------------
2   Market Environment
    Fund Snapshot
- - -----------------------------------------
3   The Portfolio Manager Responds
    Fund Quotes
    Strategy and Outlook
- - -----------------------------------------
4   Fund Data
- - -----------------------------------------
LANDMARK U.S. TREASURY RESERVES
- - -----------------------------------------
5   Statement of Assets and Liabilities
- - -----------------------------------------
6   Statement of Operations
- - -----------------------------------------
    Statement of Changes in Net Assets
- - -----------------------------------------
8   Financial Highlights
- - -----------------------------------------
9   Notes to Financial Statements
- - -----------------------------------------
U.S. TREASURY RESERVES PORTFOLIO
- - -----------------------------------------
11  Portfolio of Investments
- - -----------------------------------------
12  Statement of Assets and Liabilities
    Statement of Operations
- - -----------------------------------------
13  Statement of Changes in Net Assets
    Financial Highlights
- - -----------------------------------------
14  Notes to Financial Statements

<PAGE>
MARKET ENVIRONMENT
     On February 4, 1994,  the Federal  Reserve Board began to raise  short-term
interest rates in order to slow the growth of the U.S.  economy and forestall an
acceleration  of inflation.  By the end of February,  1995, the results of their
efforts had begun to take effect. As of this writing, the inflation rate remains
stable,  the economy appears to be slowing and long-term  interest rates,  which
often  reflect  investors'   confidence  in  fiscal  and  monetary  policy,  are
moderating from their 1994 highs.

     The road to this relatively  positive state of economic  affairs,  however,
was a rocky one.  Six months  ago,  the  economy  was  growing  faster  than its
productive  capacity  despite five  consecutive  increases in the federal  funds
rate.  Fixed-income  investors  remained  concerned  about the  potential  for a
resurgence of inflation,  causing most long-term bond prices to fall sharply. In
response to these concerns, the Federal Reserve raised short-term interest rates
twice  more--three-quarters  of a percentage point in November and one-half of a
point in February--for a total of seven increases since February 4, 1994.

     Although  higher  short-term  interest  rates put pressure on the prices of
longer term fixed-income  securities,  they had a positive effect on short-term,
cash equivalent investments.

<PAGE>
                       WEEKLY AVERAGE FEDERAL FUNDS RATE
[THE FOLLOWING DATA IS PRESENTED AS A GRAPH IN THE PRINTED REPORT]

                     Federal Funds 
                     Rate (Effective)
              3/4/94             3.28%
             3/11/94             3.25%
             3/18/94             3.19%
             3/25/94             3.31%
              4/1/94             3.49%
              4/8/94             3.69%
             4/15/94             3.37%
             4/22/94             3.59%
             4/29/94             3.59%
              5/6/94             3.76%
             5/13/94             3.70%
             5/20/94             4.02%
             5/27/94             4.22%
              6/3/94             4.27%
             6/10/94             4.13%
             6/17/94             4.21%
             6/24/94             4.19%
              7/1/94             4.19%
              7/8/94             4.38%
             7/15/94             4.30%
             7/22/94             4.30%
             7/29/94             4.28%
              8/5/94             4.28%
             8/12/94             4.26%
             8/19/94             4.35%
             8/26/94             4.66%
              9/2/94             4.72%
              9/9/94             4.74%
             9/16/94             4.70%
             9/23/94             4.73%
             9/30/94             4.66%
             10/7/94             5.07%
            10/14/94             4.62%
            10/21/94             4.72%
            10/28/94             4.72%
             11/4/94             4.77%
            11/11/94             4.74%
            11/18/94             5.22%
            11/25/94             5.53%
             12/2/94             5.85%
             12/9/94             5.47%
            12/16/94             5.48%
            12/23/94             5.56%
            12/30/94             5.45%
              1/6/95             5.40%
             1/13/95             5.53%
             1/20/95             5.45%
             1/27/95             5.42%
              2/3/95             5.63%
             2/10/95             5.95%
             2/17/95             5.93%
             2/24/95             5.94%

Source:  Federal Reserve Statistical Release H15
               
FUND SNAPSHOT

COMMENCEMENT OF OPERATIONS
May 3, 1991

NET ASSETS AS OF 2/28/95
$221.0 million

FUND OBJECTIVE
To provide liquidity and as high a level of current income from U.S.  Government
obligations as is consistent with the preservation of capital.


DIVIDENDS
Accrued daily, paid monthly

BENCHMARKS
* Lipper U.S. Treasury Money Market Funds Average

INVESTMENT ADVISER,
U.S. TREASURY RESERVES PORTFOLIO
Citibank, N.A.

THE PORTFOLIO MANAGER RESPONDS
     Although  Citibank fully expected the Federal  Reserve to tighten  monetary
policy further during the six-month  period,  we felt that investors had already
incorporated higher interest rates into the marketplace.  Consequently,  we held
the Portfolio's average maturity toward the long end of its range. This strategy
enabled  us to lock in  relatively  high  yielding  securities  and earn  higher
returns for our shareholders.

     Our  decision to maintain a relatively  long  average  maturity is based in
large  part  on  the  differences  in  yields  among  short-term  U.S.  Treasury
securities of varying maturities.  A steep "yield curve" is often characteristic
of the middle stages of the economic cycle in which interest rates at the longer
end of the  spectrum  are rising  faster than rates at the  shorter  end. As the
economic  cycle  progresses  further,  the yield curve  typically  flattens.  By
locking in higher  yielding  securities  before  this  flattening  effect  takes
effect, we have been able to produce higher returns for a longer period. Indeed,
at the end of the six-month  period,  we began to see some evidence of a flatter
yield curve within our maturity range.

     The Board of Trustees of the Landmark Funds implemented a policy change for
management  of  Landmark  U.S.  Treasury  Reserves.  As of January 3, 1995,  the
Portfolio is prohibited  from  investing in repurchase  agreements.  Previously,
U.S.  Treasury  Reserves  Portfolio  had  permission  to  invest  in  repurchase
agreements but did not choose to exercise this privilege and has had no exposure
to these securities.

                                        
FUND QUOTES FROM THE PORTFOLIO MANAGER
"We took  advantage  of  opportunities  to capture  higher  yields as the market
anticipated interest rate increases."

"Our strategy worked. We were able to earn higher yield and maintain high levels
of liquidity."

STRATEGY AND OUTLOOK
     Although the Federal Reserve may increase  short-term  interest rates again
if the  economy  grows at an  inflationary  pace,  we  believe  that most of the
increases  are behind  us.  Indeed,  we would not be  surprised  if the  Federal
Reserve  begins to loosen their reins on monetary  policy in the months ahead as
the economy slows to more sustainable levels.

     Citibank's  strategy  looking forward is the same one that we have employed
over the past six  months:  we intend  to adjust  the  average  maturity  of the
Portfolio  in  response  to  changes  in  economic  and  market  conditions.  If
short-term  interest  rates  begin to fall  over the  next  six  months,  we are
prepared to lengthen  maturities  toward the 60-day  maximum to maintain  higher
yields for as long as possible.  If, on the other hand,  interest rates begin to
rise, we may shorten maturities to help ensure  participation in higher yielding
investments as they become  available.  In the meantime,  we expect to carefully
monitor the economy,  monetary  policy and other factors that affect  short-term
U.S. Treasury securities.

     Although the Fund is permitted by prospectus to extend its average maturity
to as much as 90  days,  we do not  anticipate  exceeding  an  average  weighted
maturity of 60 days in order to maintain our current Aaa rating with Moody's and
AAAm rating with Standard & Poor's.  These are the highest  ratings  awarded for
money market mutual funds by these two nationally  recognized  securities rating
organizations.   Ratings  are  historical  and  based  on  an  analysis  of  the
Portfolio's credit quality, market price exposure and management.
<PAGE>
                                                    TOTAL RETURNS
                                       ----------------------------------------
                                                                       SINCE
                                         SIX             ONE           5/3/91
                                        MONTHS           YEAR         INCEPTION*
                                        ------           -----        ----------
Landmark U.S. Treasury Reserves........ 2.19%          3.81%           3.50%
Lipper U.S. Treasury Money Market
  Funds Average........................ 2.28%          3.98%           3.62%**
- - ---------
 *Average Annual Total Return
**From 4/30/91

7-DAY YIELDS
- - ------------
Annualized Current      4.87%
Effective               4.98%

The Annualized  Current 7-Day Yield  reflects the amount of income  generated by
the  investment  during  that seven day period  and  assumes  that the income is
generated each week over a 365 day period. The yield is shown as a percentage of
the investment.

The  Effective  7-Day Yield is calculated  similarly,  but when  annualized  the
income  earned by the  investment  during that seven day period is assumed to be
reinvested.

The  effective  yield is slightly  higher than the current  yield because of the
compounding effect of this assumed reinvestment.
        

NOTES: The Fund seeks to maintain a stable $1.00 per share price, although there
is no assurance that this will be so on a continuing  basis. Fund shares are not
insured or  guaranteed  by the U.S.  Government.  Yields and total  returns will
fluctuate and past  performance is no guarantee of future results.  Total return
figures include  reinvestment  of dividends.  Returns and yields reflect certain
voluntary fee waivers.  If the waivers were not in place, the Fund's returns and
yields would have been lower.
<PAGE>

Landmark U.S. Treasury Reserves
STATEMENT OF ASSETS AND LIABILITIES February 28, 1995 (unaudited)

ASSETS:
Investment in U.S. Treasury Reserves Portfolio,
   at value (Note 1)............................................    $221,436,846
                                                                    ------------

LIABILITIES:
Dividend payable................................................         278,322
Payable to affiliate - Shareholder Servicing Agents' 
  fee (Note 3B).................................................          40,531
Accrued expenses and other liabilities..........................          76,143
                                                                    ------------
    Total liabilities...........................................         394,996
                                                                    ------------

NET ASSETS for 221,041,850 shares of beneficial interest
   outstanding..................................................    $221,041,850
                                                                    ============

NET ASSETS CONSIST OF:
Paid-in capital.................................................    $221,041,850
                                                                    ============

NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE PER
  SHARE.........................................................        $1.00
                                                                        =====

See notes to financial statements
<PAGE>

Landmark U.S. Treasury Reserves
STATEMENT OF OPERATIONS
For the Six Months Ended February 28, 1995 (unaudited)

INVESTMENT INCOME (Note 1A):
Income from U.S. Treasury Reserves Portfolio ...      $5,375,280
Allocated expenses from U.S. Treasury Reserves
  Portfolio ....................................        (106,459)
                                                      ----------
    Net investment income from U.S. Treasury
     Reserves Portfolio.........................                      $5,268,821

EXPENSES:
Shareholder Servicing Agents' fees (Note 3B)....       $ 424,021
Administrative fees (Note 3A)...................         265,013
Distribution fees (Note 4)......................          53,003
Custodian fees..................................           9,437
Shareholder reports.............................           8,680
Auditing fees...................................           7,600
Trustee fees....................................           6,070
Transfer agent fees.............................           6,000
Legal fees......................................           2,336
Miscellaneous...................................          20,515
                                                       ---------
  Total expenses................................         802,675
  Less aggregate amounts waived by Shareholder
    Servicing Agents and Distributor (Notes
    3B and 4)...................................        (166,808)
                                                       ---------
  Net expenses..................................                         635,867
                                                                      ----------
  Net investment income.........................                      $4,632,954
                                                                      ==========

See notes to financial statements
<PAGE>
Landmark U.S. Treasury Reserves
STATEMENT OF CHANGES IN NET ASSETS

                                               SIX MONTHS ENDED
                                               FEBRUARY 28, 1995    YEAR ENDED
                                                 (UNAUDITED)     AUGUST 31, 1994
                                              -----------------  ---------------

FROM INVESTMENT ACTIVITIES:
Net investment income, declared as dividends to
  shareholders (Note 2) ......................... $   4,632,954   $   6,490,716
                                                  =============   =============

TRANSACTIONS  IN SHARES OF  BENEFICIAL  INTEREST
  AT NET ASSET VALUE OF $1.00 PER SHARE (Note 5):
Proceeds from sale of shares..................... $ 253,283,218   $ 374,714,235
Net asset value of shares issued to shareholders
  from reinvestment of dividends ................     3,496,030       5,256,070
Cost of shares repurchased.......................  (239,137,577)   (426,036,248)
                                                  -------------   -------------
NET INCREASE (DECREASE) IN NET ASSETS ...........    17,641,671     (46,065,943)

NET ASSETS:
Beginning of period..............................   203,400,179     249,466,122
                                                  -------------   -------------
End of period.................................... $ 221,041,850   $ 203,400,179
                                                  =============   =============

See notes to financial statements
<PAGE>
Landmark U.S. Treasury Reserves
<TABLE>
FINANCIAL HIGHLIGHTS
<CAPTION>
                                                                                                               MAY 3, 1991
                                  SIX MONTHS ENDED                    EIGHT MONTHS ENDED,                     (COMMENCEMENT
                                  FEBRUARY 28, 1995    YEAR ENDED      AUGUST 31, 1993       YEAR ENDED      OF OPERATIONS) TO
                                     (UNAUDITED)     AUGUST 31, 1994       (NOTE 1D)      DECEMBER 31, 1992  DECEMBER 31, 1991
                                  -----------------  ---------------  ------------------  -----------------  ----------------
<S>                               <C>                <C>              <C>                 <C>                <C>     
Net Asset Value, beginning of
  period ......................      $1.00000          $1.00000           $1.00000             $1.00000           $1.00000
Net investment income .........       0.02169           0.02837            0.01662              0.03117            0.03411
Less dividends from net 
  investment income ...........      (0.02169)         (0.02837)          (0.01662)            (0.03117)          (0.03411)
                                     --------          ---------          --------             --------           --------
Net Asset Value, end of period.      $1.00000          $1.00000           $1.00000             $1.00000           $1.00000
                                     ========          ========           ========             ========           ========

RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
  (000's omitted) .............      $221,042           $203,400          $249,466             $338,719           $548,722
                                     --------          ---------          --------             --------           --------
Ratio of expenses to average
  net assets<F1>                        0.70%<F2>          0.70%             0.66%<F2>            0.70%              0.53%<F2>
Ratio of net investment income to
  to average net assets .......         4.37%<F2>          2.81%             2.49%<F2>            3.19%              4.89%<F2>
Total return ..................         2.19%<F3>          2.87%             2.53%<F2>            3.16%              3.46%<F2>

Note: If agents of the Fund and agents of U.S. Treasury  Reserves  Portfolio had
not waived all or a portion of their fees during the periods indicated,  the net
investment income per share and the ratios would have been as follows:

Net investment income per share      $0.02015           $0.02514          $0.01455             $0.02853           $0.03076
                                     --------          ---------          --------             --------           --------
RATIOS:
Expenses to average net assets<F1>      1.01%<F2>          1.02%             0.97%<F2>            0.96%              1.02%<F2>
Net investment income to
  average net assets............        4.06%<F2>          2.49%             2.18%<F2>            2.92%              4.41%<F2>
<FN>
- - ------------
<F1>     Includes  the  Fund's  share  of  U.S.  Treasury  Reserves  Portfolio's
         allocated expenses.
<F2> Annualized.
<F3> Not Annualized.
</TABLE>

See notes to financial statements
<PAGE>
Landmark U.S. Treasury Reserves
NOTES TO FINANCIAL STATEMENTS (unaudited)

(1) SIGNIFICANT ACCOUNTING POLICIES
Landmark U.S. Treasury Reserves (the "Fund") is a diversified separate series of
Landmark Funds III (the "Trust"),  a Massachusetts  business trust. The Trust is
registered under the Investment Company Act of 1940, as amended,  as an open-end
management  investment company. The Fund invests all of its investable assets in
U.S.  Treasury Reserves  Portfolio (the  "Portfolio"),  a management  investment
company for which Citibank,  N.A. ("Citibank") serves as Investment Adviser. The
Landmark  Funds  Broker-Dealer  Services,  Inc.  ("LFBDS")  acts as the  Trust's
Administrator  and Distributor.  Citibank also serves as  Sub-Administrator  and
makes Fund shares available to customers through various  Shareholder  Servicing
Agents.

The  Trust  seeks to  achieve  the  Fund's  investment  objective  of  providing
shareholders  with  liquidity  and as high a level of current  income  from U.S.
Government  obligations  as  is  consistent  with  preservation  of  capital  by
investing  all  of  its  investable  assets  in  the  Portfolio,   an  open-end,
diversified  management  investment company having the same investment objective
as the Fund.  The value of such  investment  reflects  the Fund's  proportionate
interest (29.9% at February 28, 1995) in the net assets of the Portfolio.

The  financial   statements  of  the  Portfolio,   including  the  portfolio  of
investments,  are  contained  elsewhere  in this  report  and  should be read in
conjunction with the Fund's financial statements.

The significant  accounting  policies  consistently  followed by the Fund are in
conformity with generally accepted accounting principles and are as follows:

A. INVESTMENT INCOME -- The Fund earns income, net of Portfolio expenses,  daily
on its investment in the Portfolio.

B. FEDERAL  TAXES -- The Fund's  policy is to comply with the  provisions of the
Internal  Revenue  Code  available  to  regulated  investment  companies  and to
distribute to shareholders all of its taxable income.  Accordingly, no provision
for federal income or excise tax is necessary.

C.  EXPENSES -- The Fund bears all costs of its  operations  other than expenses
specifically assumed by Citibank and LFBDS.  Expenses incurred by the Trust with
respect to any two or more Funds in a series are  allocated in proportion to the
average net assets of each Fund,  except where allocations of direct expenses to
each Fund can otherwise be made fairly. Expenses directly attributable to a Fund
are charged to that Fund.

D. CHANGE IN FISCAL YEAR END -- On April 15,  1993,  the Fund changed its fiscal
year end from December 31 to August 31.

E. OTHER -- All the net  investment  income of the  Portfolio is  allocated  pro
rata,  based on  respective  ownership  interests,  among  the  Fund  and  other
investors in the Portfolio at the time of such determination.

(2) DIVIDENDS
The net income of the Fund is determined  once daily, as of 12:00 noon, New York
City time,  and all of the net income of the Fund so determined is declared as a
dividend to shareholders of record at the time of such determination.  Dividends
are distributed in the form of additional shares of the Fund or, at the election
of the  shareholder,  in cash  (subject  to the  policies  of the  shareholder's
Shareholder Servicing Agent) on or prior to the last business day of the month.

(3) ADMINISTRATIVE SERVICES PLAN
The Trust has adopted an  Administrative  Services Plan which  provides that the
Trust, on behalf of each Fund, may obtain the services of an Administrator,  one
or more Shareholder  Servicing Agents, and other Servicing Agents, and may enter
into agreements  providing for the payment of fees for such services.  Under the
Trust's  Administrative  Services  Plan,  the  aggregate  of the fee paid to the
Administrator  from the Fund, the fees paid to the Shareholder  Servicing Agents
from the Fund under such plan and the Basic  Distribution Fee paid from the Fund
to the  Distributor  under the  Distribution  Plan may not  exceed  0.70% of the
Fund's  average  daily  net  assets  on  an  annualized  basis  for  the  Fund's
then-current fiscal year.
<PAGE>
Landmark U.S. Treasury Reserves
NOTES TO FINANCIAL STATEMENTS (unaudited) continued

A.  ADMINISTRATIVE  FEES  --  Under  the  terms  of an  Administrative  Services
Agreement,  LFBDS  is  entitled  to an  administrative  fee from  the  Fund,  as
compensation for overall administrative  services and general office facilities,
which is accrued  daily and paid  monthly at an annual  rate of 0.25% of average
daily net assets of the Fund. The administrative  fee amounted to $265,013,  for
the six months ended February 28, 1995. Citibank acts as  Sub-Administrator  and
performs such duties and receives such  compensation  from LFBDS as from time to
time is agreed to by LFBDS and Citibank.  The Fund pays no compensation directly
to any Trustee or to any officer who is affiliated with the  Administrator,  all
of  whom  receive   remuneration  for  their  services  to  the  Fund  from  the
Administrator  or its  affiliates.  Certain of the officers and a Trustee of the
Fund are officers and a director of the Administrator or its affiliates.

B.  SHAREHOLDER  SERVICING  AGENT FEES -- The Trust,  on behalf of the Fund, has
entered into shareholder  servicing  agreements with each Shareholder  Servicing
Agent pursuant to which that  Shareholder  Servicing  Agent acts as an agent for
its customers and provides  other related  services.  For their  services,  each
Shareholder  Servicing  Agent  receives  fees from the  Fund,  which may be paid
periodically,  which may not exceed,  on an annualized basis, an amount equal to
0.40% of the average  daily net assets of the Fund  represented  by shares owned
during  the period for which  payment is being made by  investors  for whom such
Shareholder Servicing Agent maintains a servicing relationship.  The Shareholder
Servicing  Agent fees amounted to $424,021,  of which  $159,008 was  voluntarily
waived for the six months ended February 28, 1995.

(4) DISTRIBUTION FEES
The Trust has  adopted a Plan of  Distribution  pursuant to Rule 12b-1 under the
Investment  Company Act of 1940, as amended,  in which the Fund  reimburses  the
Distributor for expenses  incurred or anticipated in connection with the sale of
shares of the Fund,  at an annual rate of 0.05% of the Fund's  average daily net
assets. The Fund accrued fees aggregating  $53,003 for these services,  of which
$7,800 was voluntarily waived for the six months ended February 28, 1995.

(5) SHARES OF BENEFICIAL INTEREST
The  Declaration  of Trust permits the Trustees to issue an unlimited  number of
full and fractional shares of beneficial interest (without par value).

(6) INVESTMENT TRANSACTIONS
Increases  and decreases in the Fund's  investment  in the Portfolio  aggregated
$121,039,883 and $108,519,092,  respectively,  for the six months ended February
28, 1995.
<PAGE>
U.S. Treasury Reserves Portfolio
PORTFOLIO OF INVESTMENTS
February 28, 1995 (unaudited)

                                                  PRINCIPAL
                                                    AMOUNT
ISSUER                                          (000'S OMITTED)        VALUE

U.S. TREASURY OBLIGATIONS -- 99.9%

U.S. TREASURY BILLS -- 95.2%
     due 3/2/1995 ............................   $    180,850       $180,825,290
     due 3/16/1995 ...........................         21,760         21,714,159
     due 4/6/1995 ............................         56,490         56,177,658
     due 4/13/1995 ...........................         41,140         40,858,247
     due 4/20/1995 ...........................        215,175        213,484,262
     due 5/4/1995 ............................         10,000          9,911,556
     due 5/25/1995 ...........................         75,000         73,969,965
     due 6/29/1995 ...........................         54,865         53,848,390
     due 7/27/1995 ...........................         10,000          9,786,633
     due 8/24/1995 ...........................         20,000         19,481,289
     due 9/21/1995 ...........................         10,000          9,684,367
     due 10/19/1995 ..........................         15,000         14,362,000
                                                                    ------------
                                                                     704,103,816
                                                                    ------------


U.S. TREASURY NOTES -- 4.7%
     3.875% due 3/31/95 ......................         35,000         34,961,130
                                                                    ------------

TOTAL INVESTMENTS, AT AMORTIZED COST .    99.9%                      739,064,946
OTHER ASSETS, LESS LIABILITIES .......     0.1                           475,121
                                         -----                      ------------
NET ASSETS ...........................   100.0%                     $739,540,067
                                         =====                      ============

See notes to financial statements
<PAGE>
U.S. Treasury Reserves Portfolio
STATEMENT OF ASSETS AND LIABILITIES February 28, 1995 (unaudited)

ASSETS:
Investments, at amortized cost and value (Note 1A) ............     $739,064,946
Cash ..........................................................            2,948
Interest receivable ...........................................          566,346
Deferred organization expenses (Note 1D) ......................            3,381
                                                                    ------------
  Total assets ................................................      739,637,621
                                                                    ------------
LIABILITIES:
Payable to affiliate-- investment advisory fee (Note 2A) ......           33,516
Accrued expenses and other liabilities ........................           64,038
                                                                    ------------
  Total liabilities ...........................................           97,554
                                                                    ------------
NET ASSETS ....................................................     $739,540,067
                                                                    ============
REPRESENTED BY:
Paid-in capital for beneficial interests ......................     $739,540,067
                                                                    ============
<PAGE>
U.S. Treasury Reserves Portfolio
STATEMENT OF OPERATIONS
For the Six Months Ended February 28, 1995 (unaudited)

INTEREST INCOME (Note 1B) .......................                  $ 18,481,799
EXPENSES:
Investment Advisory fees (Note 2A) ..............   $ 546,414
Administrative fees (Note 2B) ...................     182,138
Custodian fees ..................................     122,196
Auditing fees ...................................      10,300
Trustee fees ....................................       8,228
Legal fees ......................................       5,774
Amortization of organization expenses (Note 1D) .       2,136
Miscellaneous ...................................      37,269
                                                    ---------
  Total expenses ...............................      914,455
  Less aggregate amount waived by Investment
   Adviser and Administrator (Notes 2A and 2B) .     (550,179)
                                                    ---------
  Net expenses .................................                        364,276
                                                                   ------------
  Net investment income ........................                   $ 18,117,523
                                                                   ============

See notes to financial statements
<PAGE>
U.S. Treasury Reserves Portfolio
<TABLE>
STATEMENT OF CHANGES IN NET ASSETS

<CAPTION>
                                                                            SIX MONTHS ENDED
                                                                            FEBRUARY 28, 1995      YEAR ENDED
                                                                               (UNAUDITED)       AUGUST 31, 1994
                                                                            -----------------    ---------------
INCREASE (DECREASE) IN NET ASSETS FROM:
OPERATIONS:
<S>                                                                        <C>                   <C>            
Net investment income..................................................... $    18,117,523       $    19,484,825
                                                                           ---------------       ---------------
CAPITAL TRANSACTIONS:
Proceeds from contributions...............................................   1,572,839,123         1,195,331,966
Value of withdrawals......................................................  (1,577,985,691)       (1,010,065,239)
                                                                           ---------------       ---------------
  Net increase (decrease) in net assets from capital transactions.........      (5,146,568)          185,266,727
                                                                           ---------------       ---------------
NET INCREASE IN NET ASSETS................................................      12,970,955           204,751,552
NET ASSETS:
Beginning of period.......................................................     726,569,112           521,817,560
                                                                           ---------------       ---------------
End of period............................................................. $   739,540,067       $   726,569,112
                                                                           ===============       ===============
</TABLE>

U.S. Treasury Reserves Portfolio
<TABLE>
FINANCIAL HIGHLIGHTS
<CAPTION>
                                                                                                                   MARCH 1, 1991
                               SIX MONTHS ENDED                      EIGHT MONTHS ENDED                            (COMMENCEMENT
                               FEBRUARY 28, 1995     YEAR ENDED         AUGUST 31, 1993        YEAR ENDED         OF OPERATIONS) TO
                                  (UNAUDITED)      AUGUST 31, 1994         (NOTE 1E)        DECEMBER 31, 1992    DECEMBER 31, 1991
                               -----------------   ---------------   ------------------     -----------------    ------------------
RATIOS/SUPPLEMENTAL DATA:
Net Assets, end of period
<S>                            <C>                 <C>               <C>                    <C>                  <C>     
  (000's omitted) .............     $739,540           $726,569           $521,818               $590,769             $675,332
Ratio of expenses to average
  net assets ..................        0.10%<F1>          0.12%              0.20%<F1>              0.24%                0.19%<F1>
Ratio of net investment income
  to average net assets........        4.97%<F1>          3.43%              2.96%<F1>              3.59%                5.26%<F1>
Note: If the agents of the Portfolio had not voluntarily  waived a portion of their fees for the periods indicated, the ratios would
have been as follows:
RATIOS:
Expenses to average net assets.        0.25%<F1>          0.26%              0.25%<F1>              0.25%                0.25%<F1>
Net investment income to
  average net assets...........        4.82%<F1>          3.30%              2.91%<F1>              3.58%                5.19%<F1>
<FN>
- - -------------
<F1>Annualized.
</TABLE>

See notes to financial statements
<PAGE>
U.S. Treasury Reserves Portfolio
NOTES TO FINANCIAL STATEMENTS

(1) SIGNIFICANT ACCOUNTING POLICIES
U.S.  Treasury  Reserves  Portfolio (the  "Portfolio")  is registered  under the
Investment Company Act of 1940, as amended, as a no-load, diversified,  open-end
management  investment  company which was organized as a trust under the laws of
the State of New York.  The  Declaration  of Trust permits the Trustees to issue
beneficial  interests  in  the  Portfolio.   The  Landmark  Funds  Broker-Dealer
Services,  Inc.  ("LFBDS") acts as the Portfolio's  Administrator  and Citibank,
N.A.  ("Citibank") acts as the Investment  Adviser.

   The significant  accounting policies  consistently  followed by the Portfolio
are in conformity  with  generally  accepted  accounting  principles  and are as
follows:

A. VALUATION OF INVESTMENTS -- Money market  instruments are valued at amortized
cost,  which the Trustees have determined in good faith  constitutes fair value.
This method  involves  valuing a portfolio  security at its cost and  thereafter
assuming a constant  amortization  to maturity of any  discount or premium.  The
Portfolio's use of amortized cost is subject to the Portfolio's  compliance with
certain conditions as specified under Rule 2a-7 of the Investment Company Act of
1940.

B. INTEREST INCOME AND EXPENSES -- Interest income consists of interest  accrued
and  discount  earned  (including  both  original  issue and  market  discount),
adjusted for  amortization  of premium,  on the  investments  of the  Portfolio,
accrued  ratably to the date of  maturity,  plus or minus net  realized  gain or
loss, if any, on investments. Expenses of the Portfolio are accrued daily.

C.  FEDERAL  INCOME  TAXES  -- The  Portfolio's  policy  is to  comply  with the
applicable  provisions of the Internal Revenue Code.  Accordingly,  no provision
for federal income taxes is necessary.

D.  DEFERRED  ORGANIZATION  EXPENSES -- Expenses  incurred by the  Portfolio  in
connection with its organization have been deferred and are being amortized on a
straight-line basis not to exceed five years.

E. CHANGE IN FISCAL YEAR END -- On April 15,  1993,  the  Portfolio  changed its
fiscal year end from December 31 to August 31.

F. OTHER --  Purchases,  maturities  and sales of money market  instruments  are
accounted for on the date of the transaction.

(2) INVESTMENT ADVISORY FEES AND ADMINISTRATIVE FEES
A. INVESTMENT ADVISORY FEES -- The investment advisory fees paid to Citibank, as
compensation for overall investment  management services,  amounted to $546,414,
of which $368,041 was  voluntarily  waived for the six months ended February 28,
1995. The investment  advisory fee is computed at an annual rate of 0.15% of the
Portfolio's average daily net assets.

B.  ADMINISTRATIVE  FEES  --  Under  the  terms  of an  Administrative  Services
Agreement, the administrative fee paid to the Administrator, as compensation for
overall administrative services and general office facilities,  is accrued daily
and paid monthly at the annual rate of 0.05% of the  Portfolio's  average  daily
net  assets.  The  administrative  fee  amounted to  $182,138,  all of which was
voluntarily  waived for the six months ended  February 28, 1995.  The  Portfolio
pays no  compensation  directly to any Trustee or any officer who is  affiliated
with the Administrator,  all of whom receive  remuneration for their services to
the Portfolio from the Administrator or its affiliates.  Certain of the officers
and a Trustee of the Portfolio are officers and a director of the  Administrator
or its affiliates.

(3) INVESTMENT TRANSACTIONS
Purchases,  maturities  and  sales  of  U.S.  Treasury  obligations,  aggregated
$5,658,588,112  and  $5,656,248,846,  respectively,  for  the six  months  ended
February 28, 1995.

(4) LINE OF CREDIT
The Portfolio, along with other Landmark Funds, entered into an agreement with a
bank  which  allows  the Funds  collectively  to borrow  up to $40  million  for
temporary or emergency purposes.  Interest on borrowings,  if any, is charged to
the specific  fund  executing  the  borrowing  at the base rate of the bank.  In
addition,  the $15 million  committed  portion of the line of credit  requires a
quarterly  payment of a commitment fee based on the average daily unused portion
of the  line  of  credit.  For the six  months  ended  February  28,  1995,  the
commitment  fee allocated to the Portfolio was $2,891.  Since the line of credit
was established, there have been no borrowings.

SHAREHOLDER SERVICING AGENTS

FOR CITIBANK NEW YORK RETAIL BANKING AND
BUSINESS AND PROFESSIONAL CUSTOMERS:
Citibank, N.A.
450 West 33rd Street, New York, NY 10001
(212) 564-3456 or (800) 846-5300

FOR CITIGOLD CUSTOMERS:
Citigold
P.O. Box 5130, New York, NY 10126-5130
Call Your Citigold Executive or
(212) 974-0900 or (800) 285-1701

FOR CITIBANK PRIVATE BANKING CLIENTS:
Citibank, N.A.
The Citibank Private Bank
153 East 53rd Street, New York, NY 10043
Call Your Citibank Private Banking Account Officer,
Investment Specialist or (212) 559-5959

FOR CITIBANK GLOBAL ASSET MANAGEMENT CLIENTS:
Citibank, N.A.
Citibank Global Asset Management
153 East 53rd Street, New York, NY 10043
(212) 559-7117

FOR CITIBANK NORTH AMERICAN INVESTOR SERVICES CLIENTS:
Citibank, N.A.
111 Wall Street, New York, NY 10043
Call Your Account Manager or (212) 657-9100

FOR CITICORP INVESTMENT SERVICES CUSTOMERS:
Citicorp Investment Services
One Court Square, Long Island City, NY 11120
Call Your Investment Consultant or (800) 846-5200,
(212) 736-8170 in New York City
<PAGE>

[LOGO]        LANDMARK
              FAMILY OF FUNDS

MONEY MARKET FUNDS:
Cash Reserves
Premium Liquid Reserves
Institutional Liquid Reserves

U.S. Treasury Reserves
Premium U.S. Treasury Reserves
Institutional U.S. Treasury Reserves

Tax Free Reserves
California Tax Free Reserves
Connecticut Tax Free Reserves
New York Tax Free Reserves

STOCK & BOND FUNDS:
U.S. Government Income Fund
Intermediate Income Fund
National Tax Free Income Fund
New York Tax Free Income Fund

Balanced Fund
Equity Fund
International Equity Fund
Small Cap Equity Fund
<PAGE>
TRUSTEES AND OFFICERS      
Philip W. Coolidge*, President
H.B. Alvord
C. Oscar Morong, Jr.
E. Kirby Warren
SECRETARY AND TREASURER
James B. Craver*
ASSISTANT TREASURER
Barbara M. ODette*
ASSISTANT SECRETARY
Molly S. Mugler*
*Affiliated Person of Administrator and Distributor

- - -------------------------------------------------------------------------------

INVESTMENT ADVISER
(OF U.S. TREASURY RESERVES PORTFOLIO)
Citibank, N.A.
153 East 53rd Street, New York, NY 10043
ADMINISTRATOR AND DISTRIBUTOR
The Landmark Funds Broker-Dealer Services, Inc.
6 St. James Avenue, Boston, MA 02116
(617) 423-1679
TRANSFER AGENT AND CUSTODIAN
State Street Bank and Trust Company
225 Franklin Street, Boston, MA 02110
AUDITORS
Deloitte & Touche LLP
125 Summer Street, Boston, MA 02110
LEGAL COUNSEL
Bingham, Dana & Gould
150 Federal Street, Boston, MA 02110

- - -------------------------------------------------------------------------------

SHAREHOLDER SERVICING AGENTS
(See Inside of Cover)

This report is prepared for the  information of  shareholders.  It is authorized
for  distribution to prospective  investors only when preceded or accompanied by
an effective prospectus.

This Report is Printed on Recycled Paper [Recycle Logo]

MM/UST/S/95



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