<PAGE>
INVESTMENT ADVISER
Pacific Century Trust
a division of
Bank of Hawaii
Financial Plaza of the Pacific * P.O. Box 3170
Honolulu, Hawaii 96802
ADMINISTRATOR
Aquila Management Corporation
380 Madison Avenue, Suite 2300 * New York, New York 10017
BOARD OF TRUSTEES
Lacy B. Herrmann, Chairman
Vernon R. Alden
Arthur K. Carlson
William M. Cole
Thomas W. Courtney
Richard W. Gushman, II
Stanley W. Hong
Theodore T. Mason
Russell K. Okata
Douglas Philpotts
Oswald K. Stender
OFFICERS
Diana P. Herrmann, President
Charles E. Childs, III, Senior Vice President
Sherri Foster, Vice President
Rose F. Marotta, Chief Financial Officer
Richard F. West, Treasurer
Edward M.W. Hines, Secretary
DISTRIBUTOR
Aquila Distributors, Inc.
380 Madison Avenue, Suite 2300 * New York, New York 10017
TRANSFER AND SHAREHOLDER SERVICING AGENT
PFPC Inc.
400 Bellevue Parkway * Wilmington, Delaware 19809
CUSTODIAN
Bank One Trust Company, N.A.
100 East Broad Street * Columbus, Ohio 43271
INDEPENDENT AUDITORS
KPMG LLP
757 Third Avenue * New York, New York 10017
Further information is contained in the Prospectus
which must precede or accompany this report.
SEMI-ANNUAL
REPORT
SEPTEMBER 30, 2000
THE PACIFIC CAPITAL FUNDS
OF
CASH ASSETS TRUST
PACIFIC CAPITAL CASH ASSETS TRUST
PACIFIC CAPITAL TAX-FREE
CASH ASSETS TRUST
PACIFIC CAPITAL U.S. GOVERNMENT
SECURITIES CASH ASSETS TRUST
[Logo of The Pacific Capital Funds of Cash Assets Trust: side view of a standing
lion above a coiled rope]
A CASH MANAGEMENT
INVESTMENT
</PAGE>
<PAGE>
[Logo of The Pacific Capital Funds of Cash Assets Trust: side view of a standing
lion above a coiled rope]
THE PACIFIC CAPITAL FUNDS
OF
CASH ASSETS TRUST
SEMI-ANNUAL REPORT
November 7, 2000
Dear Investor:
We are pleased to provide you with the Semi-Annual Report for The Pacific
Capital Funds of Cash Assets Trust for the six-month period ended September 30,
2000.
The enclosed Semi-Annual Report includes the three series of Cash Assets
Trust (the "Trust"): Pacific Capital Cash Assets Trust, Pacific Capital Tax-Free
Cash Assets Trust and Pacific Capital U.S. Government Securities Cash Assets
Trust and its two classes of shares: Original Shares and Service Shares.
The Trust continued to meet its objectives of providing high current
income, stability and liquidity for investors' cash reserves through investment
in taxable and tax-exempt money market securities.
Since our last correspondence six months ago, the Federal Reserve Board
(the "Fed") raised the Federal Funds rate from 6.00% to 6.50%. The Fed usually
adjusts the rate by 0.25%, but at the May 16th meeting, the Fed raised the rate
by 0.50% in an effort to squelch inflation pressures before they take root in
the economy. The Fed's action resulted from higher equity and real estate
prices, increased wages and tight labor markets, which helped spur consumer
spending during the reporting period. The booming economy also contributed to a
continued downtrend in the national unemployment rate, which reached 3.9% at the
end of September. The Fed is concerned that with a strong economy and low
unemployment, inflation would worsen as the increased stress on labor markets
would potentially put additional upward pressure on wages and ultimately prices.
We believe the Fed's rate hikes have had the desired effect and that the
economy should begin to slow over the next several months without slipping into
a recession. The slower growth should keep inflation in check, allowing the Fed
to maintain a neutral monetary policy for the rest of the year.
As we have mentioned in previous report letters, yields on money market
funds like the Trust, move in concert with rate policies pursued by the Federal
Reserve. Each of the funds continues to provide competitive returns to
alternative short-term investment opportunities without wavering from their
conservative investment guidelines.
Your use of The Pacific Capital Funds of Cash Assets Trust is greatly
appreciated. We at the Trust, together with Pacific Century Trust, the Trust's
Investment Adviser, want to thank you for your continued support and look
forward to the opportunity to continue to serve your money market fund needs.
Sincerely,
/s/ Diana P. Herrmann /s/ Lacy B. Herrmann
----------------------- ---------------------
Diana P. Herrmann Lacy B. Herrmann
President Chairman,
Board of Trustees
</PAGE>
<PAGE>
PACIFIC CAPITAL
CASH ASSETS TRUST
STATEMENT OF INVESTMENTS
SEPTEMBER 30, 2000
(UNAUDITED)
<TABLE>
<CAPTION>
FACE
AMOUNT U.S. GOVERNMENT AGENCY DISCOUNT NOTES (0.2%) VALUE
</CAPTION>
<S> <C> <C> <C> <C>
$ 1,318,000 Federal Home Loan Bank, 6.28%, 10/02/00 $ 1,317,770
COMMERCIAL PAPER (83.2%)
AUTOMOTIVE (3.9%)
25,000,000 Ford Motor Credit Co., 6.52%, 10/18/00 24,923,028
BANKING/CREDIT UNION (15.0%)
20,000,000 Abbey National NA, 6.50%, 1/19/01 19,602,778
15,000,000 Banorte, 6.53%, 12/08/00 14,814,983
LOC - Bayerische Hypo-und Vereinsbank
15,000,000 Corporacion Andina de Fomento, 6.51%, 10/20/00 14,948,463
LOC - Barclays Bank PLC
15,000,000 COSCO(Cayman) Co. Ltd., 6.52%, 10/05/00 14,989,133
LOC - Bank of America NA
30,000,000 Union Bank of Switzerland Finance, 6.52%, 10/04/00 29,983,700
Total Banking/Credit Union 94,339,057
BROKERAGE (13.3%)
30,000,000 Bear Stearns & Co., 6.52%, 1/12/01 29,440,367
30,000,000 Goldman Sachs, 6.58%, 1/19/01 29,396,833
25,000,000 Salomon Smith Barney, 6.49%, 11/29/00 24,734,090
Total Brokerage 83,571,290
CHEMICALS (4.0%)
25,000,000 Dupont (E.I.) de Nemours & Co., 6.04%, 10/16/00 24,937,083
EDUCATION (11.6%)
15,000,000 Harvard University, 6.50%, 1/16/01 14,710,208
17,000,000 Stanford University, 6.45%, 10/03/00 16,993,908
10,000,000 Stanford University, 6.54%, 2/08/01 9,763,834
32,000,000 Yale University, 6.58%, 11/20/00 31,707,556
Total Education 73,175,506
ELECTRICAL EQUIPMENT (4.7%)
30,000,000 Motorola, Inc., 6.52%, 10/30/00 29,842,433
FINANCE (21.3%)
30,000,000 American Express Credit Corp., 6.47%, 11/17/00 29,746,592
</PAGE>
<PAGE>
$ 30,000,000 American General Corp., 6.53%, 10/17/00 $ 29,912,933
25,000,000 Associates First Capital, 6.48%, 11/27/00 24,743,500
31,000,000 General Electric Capital Corp., 6.57%, 1/23/01 30,355,045
20,000,000 National Rural Utilities, 6.62%, 12/15/00 19,724,167
Total Finance 134,482,237
FOOD & BEVERAGE (4.7%)
30,000,000 Coca-Cola Co., 6.50%, 10/31/00 29,837,500
TELECOMMUNICATIONS (4.7%)
30,000,000 AT & T Corp., 6.55%, 1/04/01 29,481,458
Total Commercial Paper 524,589,592
CORPORATE NOTES (2.4%)
15,000,000 Peoples Benefit Life, Variable Rate Note, 6.68%, 7/01/29 (1) 15,000,000
REPURCHASE AGREEMENTS (14.7%)
93,000,000 SG Cowen, 6.42%, due 10/02/00 93,000,000
(Proceeds of $93,049,755 to be received at maturity)
Collateral: $100,232,000 U.S. Treasury Bill due 8/30/01
Collateral Market Value $94,860,000
Total Investments (cost $633,907,362*) 100.5% 633,907,362
Liabilities in excess of other assets (0.5) (3,203,714)
Net Assets 100.0% $ 630,703,648
</TABLE>
(*) Cost for Federal tax purposes is identical.
(1) Illiquid security. The security is considered illiquid
because it may not be sold, and may be redeemed only
upon at least ninety days' notice to the issuer.
See accompanying notes to financial statements.
</PAGE>
<PAGE>
PACIFIC CAPITAL
TAX-FREE CASH ASSETS TRUST
STATEMENT OF INVESTMENTS
SEPTEMBER 30, 2000
(UNAUDITED)
<TABLE>
<CAPTION>
RATING
FACE MOODY'S/
AMOUNT BONDS AND NOTES (96.4%) S&P VALUE
</CAPTION>
<S> <C> <C> <C> <C> <C>
ARIZONA (2.7%)
Maricopa County, Industrial Development Revenue Bonds,
$ 3,345,000 5.65%, 4/15/30, Weekly Reset* NR/AAA $ 3,345,000
FLORIDA (1.6%)
Jacksonville, Electric Authority Revenue Bonds,
Series 4-1-A
2,000,000 6.75%, 10/01/21 Aa+/AA 2,030,000
HAWAII (46.7%)
Hawaii County, Series A
150,000 5.50%, 2/01/01 Aaa/AAA 150,458
Hawaii County, Series B
1,085,000 4.25%, 5/15/01 Aaa/AAA 1,085,270
Hawaii State, Airport Revenue Bonds
2,175,000 6.75%, 7/01/21 Aaa/AAA 2,253,935
Hawaii State, Airport Revenue Bonds
2,000,000 5.38%, 7/01/01 Aaa/AAA 2,013,778
Hawaii State, General Obligation Bonds, Series BT
1,000,000 6.13%, 2/01/08 Aaa/A+ 1,015,621
Hawaii State, General Obligation Bonds, Series BT
1,300,000 6.00%, 2/01/03 Aaa/A+ 1,320,790
Hawaii State, General Obligation Bonds, Series BT
100,000 6.00%, 2/01/02 Aaa/A+ 101,517
Hawaii State, General Obligation Bonds, Series BU
1,750,000 7.25%, 11/01/00 A1/A+ 1,754,299
Hawaii State, General Obligation Bonds, Series BU
1,000,000 7.25%, 11/01/00 Aaa/AAA 1,002,666
Hawaii State, General Obligation Bonds, Series CA
2,500,000 5.13%, 1/01/01 A1/A+ 2,505,619
Hawaii State, General Obligation Bonds, Series CC
2,000,000 4.70%, 2/01/01 A1/A+ 2,000,912
Hawaii State, General Obligation Bonds, Series CD
2,000,000 4.70%, 2/01/01 A1/A+ 2,002,313
Hawaii State, General Obligation Bonds, Series CL
2,000,000 4.50%, 3/01/01 Aaa/AAA 2,001,573
</PAGE>
<PAGE>
Hawaii State, Department of Budget & Finance
ADJ-Queens Health System - Series A 1998
Revenue Bonds
$ 16,460,000 5.55%, 7/01/26, Weekly Reset* VMIG1/A-1+ $ 16,460,000
Stand-by Purchase Agreement: Morgan Guaranty Trust
Hawaii State Housing Finance & Development Corp.
Revenue Bonds (Rental Housing System) Series 89 A,
1,700,000 5.55%, 7/01/24, Weekly Reset* VMIG1/NR 1,700,000
Letter of Credit: Banque Nationale de Paris
Hawaii State Housing Finance & Development Corp.
Revenue Bonds (Affordable Rental Housing
Program) Series A,
7,450,000 5.60%, 7/01/27, Weekly Reset* VMIG1/NR 7,450,000
Letter of Credit: Banque Nationale de Paris
Honolulu City & County, General Obligation Bonds,
Series A,
4,000,000 5.55%, 1/01/17, Weekly Reset* VMIG1/A-1+ 4,000,000
Letter of Credit: Landesbank Hessen
Honolulu City & County, General Obligation Bonds,
Series B,
1,350,000 4.70%, 10/01/00 Aa3/AA- 1,350,000
Honolulu City & County, General Obligation Bonds,
Series HI
1,000,000 6.50%, 12/01/00 Aaa/AA- 1,003,500
Honolulu City & County, General Obligation Bonds,
Series HI
2,400,000 6.90%, 12/01/08 Aaa/AA- 2,435,301
Secondary Market Sevices Corporation Hawaii
Student Loan Revenue, Senior Series II,
5,000,000 5.50%, 9/01/10, Weekly Reset* VMIG1/A-1+ 5,000,000
Letter of Credit: National Westminster,
Guaranteed Student Loans
Total Hawaii 58,607,552
</PAGE>
<PAGE>
IDAHO (3.4%)
Idaho Health Facilities Authority Revenue Bonds
(St. Lukes Regional Medical Center Project),
$ 4,325,000 5.65%, 5/01/22, Daily Reset* VMIG1/NR $ 4,325,000
Letter of Credit: Bayerische Landesbank
ILLINOIS (2.1%)
Illinois Municipal Electric Agency, Series A Power
Supply System Revenue Bonds
1,000,000 6.10%, 2/01/02 Aaa/AAA 1,024,936
Southwestern, IL Development Authority
Environmental Improvement Revenue Bonds
(Shell Oil Co. Project)
1,600,000 5.70%, 11/01/25, Daily Reset* VMIG1/A-1+ 1,600,000
Total Illinois 2,624,936
INDIANA (7.5%)
Indianapolis, IN Economic Development Revenue
Bonds (Jewish Federation Campus),
4,870,000 5.85%, 4/01/05, Weekly Reset* Aa/AA 4,870,000
Purdue University, IN University Revenue Bonds
(Student Fee) Series K,
1,500,000 5.80%, 7/01/20, Weekly Reset* VMIG1/A-1+ 1,500,000
Purdue University, IN University Revenue Bonds
(Student Fee) Series L,
620,000 5.80%, 7/01/20, Weekly Reset* VMIG1/A-1+ 620,000
Purdue University, IN University Revenue Bonds
(Student Fee) Series O,
545,000 5.80%, 7/01/19, Weekly Reset* VMIG1/A-1+ 545,000
Purdue University, IN University Revenue Bonds
(Student Fee) Series H ,
1,790,000 5.80%, 7/01/17, Weekly Reset* VMIG1/A-1+ 1,790,000
Purdue University, IN University Revenue Bonds
(Student Fee) Series E,
25,000 5.80%, 7/01/11, Weekly Reset* VMIG1/A-1+ 25,000
Total Indiana 9,350,000
</PAGE>
<PAGE>
LOUISIANA (2.5%)
St. Charles Parish, LA Pollution Control Revenue
Bonds (Shell Oil Co.-Norco Project),
$ 2,100,000 5.70%, 9/01/23, Daily Reset* Aa2/AAA $ 2,100,000
St. Charles Parish, LA Pollution Control Revenue
Bonds (Shell Oil Co. Project), Series A
1,000,000 5.70%, 10/01/22, Daily Reset* Aa1/AAA 1,000,000
Total Louisiana 3,100,000
MASSACHUSETTS (2.1%)
Massachusetts State, General Obligation Bonds,
2,600,000 5.30%, 9/01/16, Weekly Reset* Aa3/AA- 2,600,000
MINNESOTA (7.3%)
Cohasset, MN Revenue Bonds, Series A (Minnesota
Power & Light Co. Project)
375,000 5.65%, 6/01/20, Daily Reset* NR/AA+ 375,000
Letter of Credit: ABN Amro Bank
Cohasset, MN Revenue Bonds, Series B (Minnesota
Power & Light Co. Project)
2,750,000 5.65%, 6/01/13, Daily Reset* NR/AA+ 2,750,000
Letter of Credit: ABN Amro Bank
Cohasset, MN Revenue Bonds, Series C (Minnesota
Power & Light Co. Project)
800,000 5.65%, 6/01/13, Daily Reset* NR/AA+ 800,000
Letter of Credit: ABN Amro Bank
Cohasset, MN Revenue Bonds, Series D
(Minnesota Power & Light Co. Project)
2,090,000 5.65%, 12/01/07, Daily Reset* NR/AA+ 2,090,000
Letter of Credit: ABN Amro Bank
Hennepin County, MN General Obligation Bonds,
Series C
180,000 5.45%, 12/01/04, Weekly Reset* VMIG1/A-1+ 180,000
Hennepin County, MN General Obligation Bonds,
Series C
1,345,000 5.45%, 12/01/10, Weekly Reset* VMIG1/A-1+ 1,345,000
Hennepin County, MN General Obligation Bonds,
Series B
</PAGE>
<PAGE>
$ 870,000 5.45%, 12/01/20, Weekly Reset* VMIG1/A-1+ $ 870,000
Minneapolis, MN, General Obligation Bonds,
305,000 5.45%, 3/01/12, Weekly Reset* Aaa/AAA 305,000
Minneapolis, MN, General Obligation Bonds,
420,000 5.45%, 12/01/18, Weekly Reset* Aaa/AAA 420,000
Total Minnesota 9,135,000
NEW YORK (2.0%)
New York, NY Municipal Water Finance Authority
Water & Sewer System Revenue Bonds, Series A,
2,500,000 5.50%, 6/15/25, Daily Reset* VMIG1/A-1+ 2,500,000
Letter of Credit: Financial Guaranty Insurance Corp.
NORTH CAROLINA (3.5%)
Durham County, NC General Obligation Bonds,
(Public Improvement Project)
2,975,000 5.45%, 2/01/11, Weekly Reset* VMIG1/A-1+ 2,975,000
Letter of Credit: Wachovia Bank
Durham County, NC General Obligation Bonds,
(Public Improvement Project)
1,475,000 5.45%, 2/01/13, Weekly Reset* VMIG1/A-1+ 1,475,000
Letter of Credit: Wachovia Bank
Total North Carolina 4,450,000
PENNSYLVANIA (3.1%)
Allegheny County, PA General Obligation Bonds,
Series C-38
1,000,000 6.40%, 9/01/03 Aaa/AAA 1,018,607
Pleasant Valley, PA General Obligation Bonds, Series A
1,000,000 6.00%, 3/15/07 Aaa/AAA 1,007,700
Pennsylvania State Higher Education Assistance
Agency Student Loan Revenue Bonds, Series B
1,800,000 5.75%, 7/01/18, Weekly Reset* VMIG1/A-1+ 1,800,000
Letter of Credit: Student Loan Marketing
Total Pennsylvania 3,826,307
</PAGE>
<PAGE>
TEXAS (4.2%)
Austin, Utility System Revenue Bonds
$ 1,500,000 6.50%, 10/01/01 Aaa/AAA $ 1,530,315
Lower Neches Valley Authority of Texas Revenue
Bonds (Chevron USA Income Project)
1,500,000 3.95%, 2/15/17 NR/A1+ 1,500,000
Westside Calhoun County, Sewer & Solid Waste
2,200,000 5.70%, 4/01/31, Daily Reset* Aa2/AA 2,200,000
Total Texas 5,230,315
UTAH (0.9%)
University of Utah Revenue Bonds, (Auxiliary &
Campus Facilities - A),
1,200,000 5.45%, 4/01/27, Weekly Reset* VMIG1/A-1+ 1,200,000
Letter of Credit: Bank of Nova Scotia
WASHINGTON (6.0%)
King & Snohomish Counties, WA General
Obligation Bonds, Series C
1,000,000 4.00%, 6/15/01 Aa3/AA- 997,402
Seattle, WA Sewer Revenue Bonds, Series U
900,000 6.60%, 1/01/32 Aaa/AAA 922,710
Seattle, WA Water System Revenue Bonds,
1,000,000 5.55%, 9/01/25, Weekly Reset* VMIG1/A-1+ 1,000,000
Letter of Credit: Bayerische Landesbank
Washington State Health Care Facility Authority
(Fred Hutchinson Cancer Research Center,
Seattle) Series 1991-A,
4,605,000 5.55%, 1/01/29, Daily Reset* VMIG1/NR 4,605,000
Letter of Credit: Bank of America
Total Washington 7,525,112
WISCONSIN (0.8%)
Milwaukee, General Obligation
1,000,000 5.00%, 2/01/01 Aa1/AA+ 1,002,992
Total Bonds and Notes 120,852,214
</PAGE>
<PAGE>
TAX-FREE COMMERCIAL PAPER (4.1%)
HAWAII (4.1%)
Hawaii Department of Budget and Finance
$ 2,000,000 4.45%, 10/03/00 NR/A1+ $ 2,000,000
Hawaii Department of Budget and Finance
3,200,000 5.20%, 10/06/00 NR/A-1 3,200,000
Total Commercial Paper 5,200,000
INVESTMENT COMPANY (0.4%)
501,000 Dreyfus Tax Exempt Money Market Fund 501,000
Total Investments (cost $126,553,214**) 100.9% 126,553,214
Liabilities in excess of other assets (0.9) (1,131,911)
Net Assets 100.0% $ 125,421,303
</TABLE>
(*) Variable rate obligation payable at par on demand
at any time on no more than seven days notice.
(**) Cost for Federal tax purposes is identical.
See accompanying notes to financial statements
</PAGE>
<PAGE>
PACIFIC CAPITAL
U.S. GOVERNMENT SECURITIES CASH ASSETS TRUST
STATEMENT OF INVESTMENTS
SEPTEMBER 30, 2000
(UNAUDITED)
<TABLE>
<CAPTION>
FACE
AMOUNT U.S. GOVERNMENT AGENCIES (100.5%) VALUE
</CAPTION>
<S> <C> <C> <C> <C>
FARM CREDIT BUREAU (54.9%)
$ 209,669,000 6.28%, due 10/02/00 $ 209,632,588
14,000,000 6.39%, due 10/11/00 13,975,150
16,000,000 6.36%, due 10/17/00 15,954,773
10,000,000 6.37%, due 11/06/00 9,936,300
11,000,000 6.38%, due 11/09/00 10,923,972
24,000,000 6.38%, due 11/22/00 23,778,827
5,000,000 6.01%, due 11/27/00 4,952,421
Total Farm Credit Bureau 289,154,031
FEDERAL HOME LOAN BANK (40.9%)
15,000,000 6.42%, due 10/04/00 14,991,975
33,000,000 6.36%, due 10/25/00 32,860,080
22,000,000 6.39%, due 11/01/00 21,879,040
20,000,000 6.40%, due 11/24/00 19,808,000
30,000,000 6.37%, due 12/13/00 29,612,492
10,000,000 6.36%, due 12/15/00 9,867,500
25,000,000 6.44%, due 1/10/01 24,548,305
6,000,000 5.99%, due 1/18/01 5,891,182
30,000,000 6.39%, due 2/02/01 29,339,958
27,000,000 6.40%, due 2/16/01 26,337,600
Total Federal Home Loan Bank 215,136,132
TENNESEE VALLEY AUTHORITY (4.7%)
25,000,000 6.38%, due 10/13/00 24,946,833
Total U.S. Government Agencies 529,236,996
Total Investments (cost $529,236,996*) 100.5% 529,236,996
Liabilities in excess of other assets (0.5) (2,615,935)
Net Assets 100.0% $ 526,621,061
</TABLE>
(*) Cost for Federal tax purposes is identical.
See accompanying notes to financial statements.
</PAGE>
<PAGE>
THE PACIFIC CAPITAL FUNDS
OF CASH ASSETS TRUST
STATEMENTS OF ASSETS AND LIABILITIES
SEPTEMBER 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
CASH TAX-FREE GOVERNMENT
FUND FUND FUND
</CAPTION>
<S> <C> <C>
ASSETS:
Investments at value
(cost $540,907,362, $126,553,214 and $529,236,996,
respectively) $ 540,907,362 $ 126,553,214 $ 529,236,996
Repurchase agreements (cost $93,000,000, $-0- and
$-0-, respectively) 93,000,000 - -
Cash 589 715 715
Interest receivable 116,654 861,140 -
Other assets 23,838 303 17,196
Total Assets 634,048,443 127,415,372 529,254,907
LIABILITIES:
Dividends payable 3,027,852 398,780 2,382,745
Payable for investment securities purchased - 1,530,586 -
Adviser and Administrator fees payable 259,679 43,053 165,892
Distribution fees payable 44,119 10,103 70,018
Accrued expenses 13,145 11,547 15,191
Total Liabilities 3,344,795 1,994,069 2,633,846
NET ASSETS $ 630,703,648 $ 125,421,303 $ 526,621,061
NET ASSETS CONSIST OF:
Capital Stock - Authorized an unlimited number of shares,
par value $.01 per share $ 6,310,756 $ 1,254,192 $ 5,266,040
Additional paid-in capital 624,770,098 124,167,146 521,365,046
Accumulated net realized loss on investments (377,206) (35) (10,025)
$ 630,703,648 $ 125,421,303 $ 526,621,061
SHARES OF BENEFICIAL INTEREST:
Original Shares Class:
Net Assets $ 415,066,294 $ 76,359,006 $ 144,315,210
Shares outstanding 415,527,593 76,357,600 144,305,386
Net asset value per share $1.00 $1.00 $1.00
Service Shares Class:
Net Assets $ 215,637,354 $ 49,062,297 $ 382,305,851
Shares outstanding 215,547,996 49,061,611 382,298,660
Net asset value per share $1.00 $1.00 $1.00
</TABLE>
See accompanying notes to financial statements.
</PAGE>
<PAGE>
THE PACIFIC CAPITAL FUNDS
OF CASH ASSETS TRUST
STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
CASH TAX-FREE GOVERNMENT
FUND FUND FUND
</CAPTION>
<S> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
Interest income $ 20,694,076 $ 2,844,305 $ 14,876,192
EXPENSES:
Investment Adviser fees (note 3) 1,220,424 194,852 758,463
Administrator fees (note 3) 388,137 75,971 182,763
Distribution fees (note 3) 242,604 61,882 405,399
Trustees' fees and expenses 75,000 26,000 55,000
Legal fees 26,000 7,000 18,000
Registration fees and dues 23,000 4,000 19,000
Shareholders' reports 19,000 3,000 10,000
Fund accounting fees 14,700 14,100 15,000
Transfer and shareholder servicing agent fees 13,000 12,000 12,000
Insurance 11,000 2,000 9,000
Audit and accounting fees 8,000 6,000 8,000
Custodian fees 4,200 3,300 3,400
Miscellaneous 3,190 2,010 12,420
Total expenses 2,048,255 412,115 1,508,445
Expenses paid indirectly (note 6) (200) (300) (400)
Net expenses 2,048,055 411,815 1,508,045
Net investment income 18,646,021 2,432,490 13,368,147
Net realized gain from securities transactions - 5 -
Net increase in net assets resulting from operations $ 18,646,021 $ 2,432,495 $ 13,368,147
</TABLE>
See accompanying notes to financial statements.
</PAGE>
<PAGE>
THE PACIFIC CAPITAL FUNDS
OF CASH ASSETS TRUST
STATEMENTS OF CHANGES IN NET ASSETS
(UNAUDITED)
<TABLE>
<CAPTION>
CASH FUND TAX-FREE FUND GOVERNMENT FUND
SIX MONTHS YEAR SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
SEPT. 30, 2000 MARCH 31, 2000 SEPT. 30, 2000 MARCH 31, 2000 SEPT. 30, 2000 MARCH 31, 2000
</CAPTION>
<S><C><C><C> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
OPERATIONS:
Net investment income $ 18,646,021 $ 27,536,758 $ 2,432,490 $ 3,740,384 $ 13,368,147 $ 17,020,919
Net realized gain (loss)
from securities transactions - 34,316 5 - - ( 1,535)
Change in net assets
resulting from operations 18,646,021 27,571,074 2,432,495 3,740,384 13,368,147 17,019,384
DIVIDENDS TO SHAREHOLDERS
FROM NET INVESTMENT INCOME:
Original Shares (13,171,571) (19,411,107) (1,582,312) (2,530,922) (4,266,232) (6,323,047)
Service Shares (5,474,450) (8,125,651) (850,178) (1,209,462) (9,101,915) (10,697,872)
Total dividends to shareholders
from net investment income (18,646,021) (27,536,758) (2,432,490) (3,740,384) (13,368,147) (17,020,919)
CAPITAL SHARE TRANSACTIONS
(at $1.00 per share):
Proceeds from shares sold:
Original Shares 599,914,903 1,186,795,291 94,090,099 168,207,597 248,095,801 427,019,622
Service Shares 286,563,670 377,884,308 43,328,341 65,317,175 581,780,497 1,062,992,710
886,478,573 1,564,679,599 137,418,440 233,524,772 829,876,298 1,490,012,332
Reinvested dividends and
distributions:
Original Shares 282,033 222,982 52,483 98,624 53,344 48,859
Service Shares 5,223,932 7,899,056 833,600 1,169,590 8,588,164 10,263,790
5,505,965 8,122,038 886,083 1,268,214 8,641,508 10,312,649
Cost of shares redeemed:
Original Shares (698,087,382) (1,091,834,549) (118,204,284) (151,311,068) (269,522,168) (401,257,550)
Service Shares (250,525,148) (374,062,057) (45,795,065) (63,349,933) (501,368,689) (994,232,663)
(948,612,530) (1,465,896,606) (163,999,349) (214,661,001) (770,890,857) (1,395,490,213)
Change in net assets
from capital share transactions (56,627,992) 106,905,031 (25,694,826) 20,131,985 67,626,949 104,834,768
Total change in net assets (56,627,992) 106,939,347 (25,694,821) 20,131,985 67,626,949 104,833,233
NET ASSETS:
Beginning of period 687,331,640 580,392,293 151,116,124 130,984,139 458,994,112 354,160,879
End of period $ 630,703,648 $ 687,331,640 $ 125,421,303 $ 151,116,124 $ 526,621,061 $ 458,994,112
</TABLE>
See accompanying notes to financial statements.
</PAGE>
<PAGE>
THE PACIFIC CAPITAL FUNDS
OF CASH ASSETS TRUST
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
1. ORGANIZATION
Cash Assets Trust (the "Trust") was organized on May 7, 1984 as a
Massachusetts business trust and is registered under the Investment Company Act
of 1940 (the "1940 Act") as an open-end investment company.
The Trust consists of the following three investment portfolios (referred
to individually as a "Fund" and collectively as the "Funds"): Pacific Capital
Cash Assets Trust (a diversified portfolio which commenced operations on
December 5, 1984), Pacific Capital Tax-Free Cash Assets Trust (a non-diversified
portfolio which commenced operations on April 4, 1989), and Pacific Capital U.S.
Government Securities Cash Assets Trust (a diversified portfolio which commenced
operations on April 4, 1989). The Trust is authorized to issue for each Fund an
unlimited number of shares of $.01 par value in two classes of shares; the
Original Shares Class and the Service Shares Class. The Original Shares Class
includes all currently outstanding shares of each Fund that were issued prior to
January 20, 1995, the date on which the Capital structure was changed to include
two classes rather than one. The two classes of shares are substantially
identical, except that Service Shares bear the fees that are payable under the
Trust's Distribution Plan.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed by
the Funds in the preparation of their financial statements. The policies are in
conformity with generally accepted accounting principles for investment
companies.
a) PORTFOLIO VALUATION: Each Fund's portfolio securities are valued by the
amortized cost method permitted in accordance with Rule 2a-7 under the 1940
Act, which, after considering accrued interest thereon, approximates
market. Under this method, a portfolio security is valued at cost adjusted
for amortization of premiums and accretion of discounts. Amortization of
premiums and accretion of discounts are included in interest income.
b) SECURITIES TRANSACTIONS AND RELATED INVESTMENT INCOME: Securities
transactions are recorded on the trade date. Realized gains and losses from
securities transactions are reported on the identified cost basis. Interest
income is recorded daily on the accrual basis and is adjusted for
amortization of premiums and accretion of discounts as discussed in the
preceding paragraph.
c) DETERMINATION OF NET ASSET VALUE AND CALCULATION OF EXPENSES: The net asset
value per share for each class of the Funds' shares is determined as of
4:00 p.m. New York time on each day that the New York Stock Exchange is
open by dividing the value of the assets of the Fund allocable to that
class less Fund liabilities allocable to the class and any liabilities
charged directly to the class, exclusive of surplus, by the total number of
shares of the class outstanding. Investment income, realized and unrealized
gains and losses, if any, and expenses other than class specific expenses,
are allocated daily to each class of shares based upon the proportion of
net assets of each class. Class specific expenses are borne by the affected
class. Service fee payments under Rule 12b-1 are borne solely by and
charged to the Service Shares based on net assets of that class.
</PAGE>
<PAGE>
d) FEDERAL INCOME TAXES: It is the policy of each Fund to qualify as a
regulated investment company by complying with the provisions of the
Internal Revenue Code applicable to certain investment companies. Each Fund
intends to make distributions of income and securities profits sufficient
to relieve it from all, or substantially all, Federal income and excise
taxes.
e) REPURCHASE AGREEMENTS: It is each Fund's policy to monitor closely the
creditworthiness of all firms with which it enters into repurchase
agreements, and to take possession of, or otherwise perfect its security
interest in, securities purchased under agreements to resell. The
securities purchased under agreements to resell are marked to market every
business day in order to compare the value of the collateral to the amount
of the "loan" (repurchase agreements being defined as "loans" in the 1940
Act), including the accrued interest earned thereon. If the value of the
collateral is less than 102% of the loan plus the accrued interest thereon,
additional collateral is required from the borrower.
f) USE OF ESTIMATES: The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date
of the financial statements and the reported amounts of increases and
decreases in net assets from operations during the reporting period. Actual
results could differ from those estimates.
3. FEES AND RELATED PARTY TRANSACTIONS
a) MANAGEMENT ARRANGEMENTS:
Pacific Century Trust (the "Adviser"), a division of Bank of Hawaii, serves
as Investment Adviser to the Trust. In this role, under Investment Advisory
Agreements, the Adviser supervises the Funds' investments and provides various
services. The Funds also have Administration Agreements with Aquila Management
Corporation (the "Administrator") to provide all administrative services to the
Funds other than those relating to the investment portfolio and the maintenance
of the accounting books and records. Specific details as to the nature and
extent of the services provided by the Adviser and the Administrator are more
fully defined in the Prospectus and Statement of Additional Information of the
Funds. For their services, the Adviser and the Administrator each receive a fee
which is payable monthly and computed as of the close of business each day on
the net assets of each Fund at the following annual rates:
Pacific Capital Cash Assets Trust - On net assets up to $325 million, the
fee is paid to the Adviser and the Administrator at the annual rate of 0.33% and
0.17%, respectively, and on net assets above that amount at the annual rate of
0.43% and 0.07%, respectively. For the six months ended September 30, 2000, the
Fund incurred fees under the Advisory Agreement and the Administration Agreement
of $1,220,424 and $388,137 respectively.
Pacific Capital Tax-Free Cash Assets Trust - On net assets up to $95
million, the fee is paid to the Adviser and the Administrator at the annual rate
of 0.27% and 0.13%, respectively, and on net assets above that amount at the
annual rate of 0.33% and 0.07%, respectively. For the six months ended September
30, 2000, the Fund incurred fees under the Advisory Agreement and the
Administration Agreement of $194,852 and $75,971, respectively.
</PAGE>
<PAGE>
Pacific Capital U.S. Government Securities Cash Assets Trust - On net
assets up to $60 million, the fee is paid to the Adviser and the Administrator
at the annual rate of 0.27% and 0.13%, respectively, and on net assets above
that amount at the annual rate of 0.33% and 0.07%, respectively. For the six
months ended September 30, 2000, the Fund incurred fees under the Advisory
Agreement and the Administration Agreement of $758,463 and $182,763
respectively.
The Adviser and the Administrator each agrees that the above fees shall be
reduced, but not below zero, by an amount equal to its proportionate share
(determined on the basis of the respective fees computed as described above) of
the amount, if any, by which the total expenses of a Fund in any fiscal year,
exclusive of taxes, interest and brokerage fees, shall exceed the lesser of (i)
2.5% of the first $30 million of average annual net assets of the Fund plus 2%
of the next $70 million of such assets and 1.5% of its average annual net assets
in excess of $100 million, or (ii) 25% of the Fund's total annual investment
income. The payment of the above fees at the end of any month will be reduced or
postponed so that at no time will there be any accrued but unpaid liability
under this expense limitation. No such reduction in fees was required during the
six months ended September 30, 2000.
b) DISTRIBUTION AND SERVICE FEES:
Each Fund has adopted a Distribution Plan (the "Plan") pursuant to Rule
12b-1 under the 1940 Act. A part of the Plan authorizes payment of certain
distribution or service fees by the Service Shares Class of the Fund. Such
payments are made to "Designated Payees"- broker-dealers, other financial
institutions and service providers who have entered into appropriate agreements
with the Distributor and which have rendered assistance in the distribution
and/or retention of the Funds' Service Shares or in the servicing of Service
Share accounts. The total payments under this part of a Fund's Plan may not
exceed 0.25 of 1% of its average annual assets represented by Service Shares. No
such payments will be made by the Original Share Class. Specific details about
each Plan are more fully defined in the Prospectus and Statement of Additional
Information of the Funds.
Under a Distribution Agreement, Aquila Distributors, Inc. (the
"Distributor") serves as the exclusive distributor of the Funds' shares. No
compensation or fees are paid to the Distributor for such share distribution.
</PAGE>
<PAGE>
4. DISTRIBUTIONS
The Funds declare dividends daily from net investment income and make
payments monthly in additional shares at the net asset value per share, in cash,
or a combination of both, at the shareholder's option.
At March 31, 2000, the Cash Fund had a capital loss carryover of
approximately $377,200 which expires on March 31, 2003, and the Government Fund
had a capital loss carryover of approximately $9,700 which expires on March 31,
2008. These amounts are available to offset future net realized gains on
securities transactions to the extent provided for in the Internal Revenue Code
and it is probable the gains so offset will not be distributed.
5. GUARANTEES OF CERTAIN COMMERCIAL PAPER
Various banks and other institutions have issued irrevocable letters of
credit or guarantees for the benefit of the holders of certain commercial paper.
Payment at maturity of principal and interest of certain commercial paper held
by the Funds is supported by such letters of credit or guarantees.
6. EXPENSES
The Funds have negotiated an expense offset arrangement with their
custodian, wherein they receive credit toward the reduction of custodian fees
and other expenses whenever there are uninvested cash balances. The Statements
of Operations reflect the total expenses before any offset, the amount of offset
and the net expenses. It is the general intention of the Funds to invest, to the
extent practicable, some or all of cash balances in income-producing assets
rather than leave cash on deposit.
7. PORTFOLIO ORIENTATION
Since the Pacific Capital Tax-Free Cash Assets Trust has a significant
portion of its investments in obligations of issuers within Hawaii, it is
subject to possible risks associated with economic, political, or legal
developments or industrial or regional matters specifically affecting Hawaii and
whatever effects these may have upon Hawaii issuers ability to meet their
obligations.
</PAGE>
<PAGE>
PACIFIC CAPITAL
CASH ASSETS TRUST
FINANCIAL HIGHLIGHTS
(UNAUDITED)
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
ORIGINAL SHARES SERVICE SHARES
SIX MONTHS SIX MONTHS
ENDED YEAR ENDED MARCH 31, ENDED YEAR ENDED MARCH 31,
9/30/00 2000 1999 1998 1997 1996 9/30/00 2000 1999 1998 1997 1996
</CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
Income from Investment Operations:
Net investment income 0.03 0.05 0.05 0.05 0.05 0.05 0.03 0.05 0.05 0.05 0.05 0.05
Less Distributions:
Dividends from net investment
income (0.03) (0.05) (0.05) (0.05) (0.05) (0.05) (0.03) (0.05) (0.05) (0.05) (0.05) (0.05)
Net Asset Value, End of Period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
Total Return (%) 2.98+ 4.89 4.90 5.15 4.88 5.32 2.85+ 4.63 4.64 4.88 4.62 5.06
Ratios/Supplemental Data
Net Assets, End of Period
($ millions) 415 513 418 419 421 309 216 174 163 113 66 33
Ratio of Expenses to Average Net
Assets (%) 0.56* 0.56 0.57 0.58 0.60 0.61 0.81* 0.81 0.81 0.83 0.85 0.86
Ratio of Net Investment Income to
Average Net Assets (%) 5.87* 4.80 4.79 5.03 4.78 5.23 5.64* 4.53 4.51 4.77 4.53 4.84
The expense ratios after giving effect to the expense offset for uninvested
cash balances were:
Ratio of Expenses to Average Net
Assets (%) 0.56* 0.56 0.56 0.57 0.60 0.60 0.81* 0.81 0.81 0.82 0.85 0.86
</TABLE>
+ Not annualized.
* Annualized.
See accompanying notes to financial statements.
</PAGE>
<PAGE>
PACIFIC CAPITAL
TAX-FREE CASH ASSETS TRUST
FINANCIAL HIGHLIGHTS
(UNAUDITED)
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
ORIGINAL SHARES SERVICE SHARES
SIX MONTHS SIX MONTHS
ENDED YEAR ENDED MARCH 31, ENDED YEAR ENDED MARCH 31,
9/30/00 2000 1999 1998 1997 1996 9/30/00 2000 1999 1998 1997 1996
</CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
Income from Investment Operations:
Net investment income 0.02 0.03 0.03 0.03 0.03 0.03 0.02 0.03 0.03 0.03 0.03 0.03
Less Distributions:
Dividends from net investment
income (0.02) (0.03) (0.03) (0.03) (0.03) (0.03) (0.02) (0.03) (0.03) (0.03) (0.03) (0.03)
Net Asset Value, End of Period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
Total Return (%) 1.87+ 2.95 2.91 3.08 3.00 3.37 1.74+ 2.70 2.65 2.83 2.75 3.11
Ratios/Supplemental Data
Net Assets, End of Period
($ millions) 76 100 83 77 91 125 49 51 48 37 26 18
Ratio of Expenses to Average
Net Assets (%) 0.52* 0.52 0.54 0.63 0.55 0.54 0.77* 0.77 0.79 0.88 0.80 0.80
Ratio of Net Investment Income
to Average Net Assets (%) 3.68* 2.93 2.85 3.04 2.97 3.32 3.43* 2.66 2.64 2.79 2.70 2.97
The expense ratios after giving effect to the expense offset for uninvested
cash balances were:
Ratio of Expenses to Average
Net Assets (%) 0.52* 0.52 0.53 0.63 0.55 0.54 0.77* 0.77 0.78 0.88 0.80 0.80
</TABLE>
+ Not annualized.
* Annualized.
See accompanying notes to financial statements.
<PAGE>
</PAGE>
PACIFIC CAPITAL
U.S. GOVERNMENT SECURITIES CASH ASSETS TRUST
FINANCIAL HIGHLIGHTS
(UNAUDITED)
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
ORIGINAL SHARES SERVICE SHARES
SIX MONTHS SIX MONTHS
ENDED YEAR ENDED MARCH 31, ENDED YEAR ENDED MARCH 31,
9/30/00 2000 1999 1998 1997 1996 9/30/00 2000 1999 1998 1997 1996
</CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
Income from Investment Operations:
Net investment income 0.03 0.05 0.04 0.05 0.05 0.05 0.03 0.04 0.04 0.05 0.04 0.05
Less Distributions:
Dividends from net investment
income (0.03) (0.05) (0.04) (0.05) (0.05) (0.05) (0.03) (0.04) (0.04) (0.05) (0.04) (0.05)
Net Asset Value, End of Period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
Total Return (%) 2.97+ 4.83 4.80 4.95 4.76 5.20 2.84+ 4.56 4.54 4.69 4.50 4.94
Ratios/Supplemental Data
Net Assets, End of Period
($ millions) 144 166 140 101 66 74 382 293 214 150 83 12
Ratio of Expenses to Average
Net Assets (%) 0.47* 0.49 0.49 0.52 0.56 0.55 0.72* 0.74 0.74 0.77 0.80 0.80
Ratio of Net Investment Income to
Average Net Assets (%) 5.83* 4.73 4.70 4.85 4.65 5.06 5.63* 4.50 4.42 4.60 4.42 4.67
The expense and net investment income ratios without the effect of the
Adviser's and Administrator's voluntary waiver of fees for the year ended
March 31, 1996 were:
Ratio of Expenses to Average
Net Assets (%) - - - - - 0.63 - - - - - 0.88
Ratio of Net Investment Income to
Average Net Assets (%) - - - - - 4.98 - - - - - 4.59
The expense ratios after giving effect to the expense offset for uninvested
cash balances were:
Ratio of Expenses to Average
Net Assets (%) 0.47* 0.49 0.49 0.52 0.55 0.54 0.72* 0.74 0.74 0.77 0.79 0.79
</TABLE>
+ Not annualized.
* Annualized.
See accompanying notes to financial statements.
</PAGE>
