<PAGE>
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CONNECTICUT
DAILY TAX FREE 600 FIFTH AVENUE, NEW YORK, N.Y. 10020
INCOME FUND, INC. (212) 830-5200
================================================================================
Dear Shareholder:
We are pleased to present the annual report of Connecticut Daily Tax Free Income
Fund, Inc. for the year ended January 31, 1999.
The Fund had net assets of $182,616,236 and 516 active shareholders as of
January 31, 1999.
Thank you for your support and we look forward to continuing to serve your cash
management needs.
Sincerely,
\s\Steven W. Duff
Steven W. Duff
President
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<PAGE>
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CONNECTICUT DAILY TAX FREE INCOME FUND, INC.
STATEMENT OF NET ASSETS
JANUARY 31, 1999
================================================================================
<TABLE>
<CAPTION>
Ratings (a)
-----------------
Face Maturity Value Standard
Amount Date Yield (Note 1) Moody's & Poor's
------ ---- ----- ------ ------- ------
Other Tax Exempt Investments (23.43%)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
$ 5,000,000 Commonwealth of Puerto Rico TRAN 07/30/99 2.83% $ 5,015,728 MIG-1 SP-1+
1,000,000 Connecticut State GO Bonds - Series A (c) 03/15/99 3.13 1,002,337
2,075,000 Connecticut State GO Bonds - Series B (c) 03/15/99 3.56 2,075,920
2,870,000 Meriden, CT BAN (c)
MBIA Insured 02/01/99 4.25 2,870,000
2,640,000 Milford, CT BAN (c) 11/10/99 2.76 2,648,921
3,000,000 New Haven, CT BAN 02/01/99 3.46 3,000,000 MIG-1
2,910,000 Norwich, CT BAN (c) 11/04/99 2.74 2,914,698
3,000,000 Regional School District #14
(Towns of Bethlehem and Woodbury) (c) 06/01/99 3.62 3,003,133
7,000,000 South Central, CT Regional Water System 07/28/99 3.53 7,013,922 MIG-1
2,000,000 Stamford, CT BAN (c) 05/17/99 3.41 2,000,106
1,400,000 Town of Fairfield, CT Sewer Assessment Note (c) 06/04/99 3.59 1,400,132
4,235,000 Town of Ledyard, CT BAN (c) 09/15/99 2.83 4,235,508
3,000,000 Town of New Canaan, CT BAN (c) 03/09/99 3.41 3,000,828
1,275,000 Town of New Canaan, CT BAN (c) 09/15/99 3.06 1,276,151
1,325,000 Westport, CT GO Bonds (c) 09/15/99 3.28 1,336,598
- ------------- ------------
42,730,000 Total Other Tax Exempt Investments 42,793,982
- ------------- ------------
<CAPTION>
Other Variable Rate Demand Instruments (b) (58.22%)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
$ 3,300,000 Connecticut Development Authority Refunding Airport Hotel RB
(Bradley Airport Hotel Project) - Series 1997A
LOC Kredietbank 03/01/17 2.65% $ 3,300,000 VMIG-1
1,000,000 Connecticut Development Authority Refunding Airport Hotel RB
(Bradley Airport Hotel Project) - Series 1997B
LOC Royal Bank of Canada 03/01/17 2.65 1,000,000 VMIG-1
5,600,000 Connecticut Development Authority PCRB
(CT Light & Power Company Project) - Series 1996A
AMBAC Insured 05/01/31 2.30 5,600,000 VMIG-1 A1+
11,200,000 Connecticut HEFA (Edgeville Life Center in Greenwich) - Series B
LOC Banque Paribas 07/01/04 3.00 11,200,000 VMIG-1
5,000,000 Connecticut HFA (Elm Haven) - Series A (c)
LOC Fleet National Bank 12/01/17 2.90 5,000,000
6,600,000 Connecticut HFA Housing Mortgage
Finance Program Bonds - Series 1995G
AMBAC Insured 05/15/18 2.55 6,600,000 VMIG-1 A1+
3,200,000 Connecticut HFA Housing Mortgage
Finance Program Bonds - Series D-3
AMBAC Insured 11/15/28 2.70 3,200,000 VMIG-1 A1+
6,750,000 Connnecticut Resources Recovery Authority
(Ref-Fuel Company of South East Connecticut - Duke Capital) 11/15/15 2.90 6,750,000 A1
</TABLE>
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See Notes to Financial Statements.
<PAGE>
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================================================================================
<TABLE>
<CAPTION>
Ratings (a)
-----------------
Face Maturity Value Standard
Amount Date Yield (Note 1) Moody's & Poor's
------ ---- ----- ------ ------- ------
Other Variable Rate Demand Instruments (b) (Continued)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
$ 2,000,000 Connecticut State GO - Series 1987B 05/15/14 2.20% $ 2,000,000 VMIG-1 A1+
4,350,000 Connecticut State Development Authority (Independent Living)
LOC Chase Manhattan Bank, N.A. 07/01/15 2.45 4,350,000 VMIG-1
1,000,000 Connecticut State Development Authority IDRB (c)
(Columbia Diamond Ring)
LOC Fleet National Bank 09/01/08 3.35 1,000,000
6,000,000 Connecticut State Development Authority IDRB
(Gerber Scientific Incorporated)
LOC Wachovia Bank & Trust Co., N.A. 12/01/14 2.85 6,000,000 A1+
900,000 Connecticut State Development Authority IDRB
(Vitta Corporation Project)
LOC Barclays Bank PLC 08/01/09 3.35 900,000 P1 A1+
3,000,000 Connecticut State Special Tax Obligation ROCS - Series 21
MBIA Insured 06/30/07 2.92 3,000,000 A1+
3,000,000 Connecticut State Special Tax Obligation ROCS - Series 22 (c)
FGIC Insured 11/23/09 2.92 3,000,000
9,245,000 Connecticut State Special Tax Obligation RB
(Second Lien Transportation Infrastructure)
LOC Commerzbank A.G. 12/01/10 2.65 9,245,000 P1 A1+
1,855,000 Puerto Rico Ana Mendez University System
(Industrial Tourist Educational, Medical & Environmental)
LOC Banco Santander 10/01/21 2.20 1,855,000 A1+
6,000,000 Puerto Rico Commonwealth GO
(Puerto Rico Electric Power Authority)
MBIA Insured 07/01/23 2.67 6,000,000 VMIG-1
1,660,000 Shelton, CT Housing Authority RB (c)
LOC First Union National Bank 01/01/31 2.60 1,660,000
3,000,000 Societe Generale #43
(Puerto Rico Electric Power Authority) - Series AA
MBIA Insured 07/01/22 2.60 3,000,000 A1+
4,950,000 State of Connecticut GO BTP-293 03/15/09 2.85 4,950,000 VMIG-1
4,900,000 State of Connecticut HEFA (Bradley Health Care Issue) - Series B
LOC Fleet National Bank 07/01/29 2.25 4,900,000 VMIG-1
1,500,000 State of Connecticut HEFA (Charlotte Hungerford Hospital)
LOC Bank of Boston 07/01/13 2.55 1,500,000 VMIG-1
1,700,000 State of Connecticut HEFA
(Hospital of Saint Raphael Issue) - Series K
LOC Kredietbank 07/01/22 2.70 1,700,000 VMIG-1
1,210,000 State of Connecticut HEFA (Sharon Hospital Issue)
LOC Bank of Boston 07/01/27 2.55 1,210,000 VMIG-1
</TABLE>
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See Notes to Financial Statements.
<PAGE>
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CONNECTICUT DAILY TAX FREE INCOME FUND, INC.
STATEMENT OF NET ASSETS (CONTINUED)
JANUARY 31, 1999
================================================================================
<TABLE>
<CAPTION>
Ratings (a)
-----------------
Face Maturity Value Standard
Amount Date Yield (Note 1) Moody's & Poor's
------ ---- ----- ------ ------- ------
Other Variable Rate Demand Instruments (b) (Continued)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
$ 5,000,000 State of Connecticut HEFA (Yale University) 07/01/29 2.25% $ 5,000,000 VMIG-1 A1+
2,400,000 State of Connecticut HEFA - Series A
LOC Credit Locale De France 07/01/24 2.70 2,400,000 VMIG-1
- ------------- ------------
106,320,000 Total Other Variable Rate Demand Instruments 106,320,000
- ------------- ------------
<CAPTION>
Put Bonds (d) (8.76%)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
$ 1,000,000 Connecticut HEFA (Yale New Haven Hospital) - Series E
FGIC Insured 06/01/99 3.70% $ 1,000,000 VMIG-1 A1+
5,000,000 Connecticut State Special Assessment Unemployment
Compensation Advance Fund RB - Series 1993C
FGIC Insured 07/01/99 3.60 5,000,000 VMIG-1 A1+
3,280,000 Puerto Rico Industrial Medical & Environmental PCFA
(Merk & Co.) (c) 12/01/99 2.97 3,277,332
6,710,000 Puerto Rico Industrial Medical & Environmental PCFA RB
(Reynolds Metals Corporation)
LOC ABN AMRO Bank N.V. 09/01/99 3.60 6,710,000 VMIG-1 A1+
- ------------- ------------
15,990,000 Total Put Bonds 15,987,332
- ------------- ------------
<CAPTION>
Revenue Bonds (0.96%)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
$ 730,000 Connecticut State Development Authority RB
(Life Care Facility-Seabury) (c)
LOC Asset Guaranty 09/01/99 3.30% $ 730,000
1,000,00 Connecticut State Special Tax Obligation RB
Transportation Infrastructure - Series A (c) 12/01/99 2.87 1,029,192
- ------------- ------------
1,730,000 Total Revenue Bonds 1,759,192
- ------------- ------------
<CAPTION>
Tax Exempt Commercial Paper (13.40%)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
$ 895,000 Connecticut HFA Mortgage Project 1989 - Series D
Federal Housing Authority/Veterans Association/Private Mortgages 02/09/99 3.00% $ 895,000 VMIG-1 A1+
1,572,000 Puerto Rico Government Development Bank 05/14/99 2.75 1,572,000 A1+
5,000,000 State of Connecticut HEFA RB (Yale University) 02/16/99 2.60 5,000,000 VMIG-1 A1+
2,000,000 State of Connecticut HEFA RB (Yale University) 05/03/99 2.75 2,000,000 VMIG-1 A1+
3,000,000 State of Connecticut HEFA RB (Yale University) 05/12/99 2.80 3,000,000 VMIG-1 A1+
7,000,000 State of Connecticut Special Assessment Second Injury Fund
LOC Credit Agricole/Credit Commercial de Belgique 02/04/99 2.90 7,000,000 P1 A1+
3,000,000 State of Connecticut Special Assessment Second Injury Fund
LOC Credit Agricole/Credit Commercial de Belgique 02/17/99 2.80 3,000,000 P1 A1+
2,000,000 State of Connecticut Special Assessment Second Injury Fund
LOC Credit Agricole/Credit Commercial de Belgique 02/18/99 2.75 2,000,000 P1 A1+
- ------------- ------------
24,467,000 Total Tax Exempt Commercial Paper 24,467,000
- ------------- ------------
</TABLE>
- --------------------------------------------------------------------------------
See Notes to Financial Statements.
<PAGE>
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================================================================================
<TABLE>
<CAPTION>
Ratings (a)
-----------------
Face Maturity Value Standard
Amount Date Yield (Note 1) Moody's & Poor's
------ ---- ----- ------ ------- ------
Variable Rate Demand Instruments - Participations (b) (0.35%)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
$ 631,184 Connecticut State Development Authority IDRB (Nefco Holding)
LOC Chase Manhattan Bank, N.A. 11/01/00 5.03% $ 631,184 P1 A1
- ------------- ------------
631,184 Total Variable Rate Demand Instruments - Participations 631,184
- ------------- ------------
Total Investments (105.12%) (Cost $191,958,690+) 191,958,690
Liabilities in Excess of Cash and Other Assets (-5.12%) ( 9,342,454)
------------
Net Assets (100.00%) $182,616,236
============
Net Asset Value, offering and redemption per share:
Class A Shares, 182,253,139 Shares Outstanding (Note 3) $ 1.00
============
Class B Shares, 388,759 Shares Outstanding (Note 3) $ 1.00
============
+ Aggregate cost for federal income tax purposes is $191,958,144.
</TABLE>
FOOTNOTES:
(a) Unless the variable rate demand instruments are assigned their own ratings,
the ratings are those of the holding company of the bank whose letter of
credit guarantees the issue or the insurance company who insures the issue.
All letters of credit and insurance are irrevocable and direct pay covering
both principal and interest. Certain issuers have either a line of credit,
a liquidity facility, a standby purchase agreement or some other financing
mechanism to ensure the remarketing of the securities. This is not a
guarantee and does not serve to insure or collateralize the issue.
(b) Securities payable on demand at par including accrued interest (usually
with seven days notice) and unconditionally secured as to principal and
interest by a bank letter of credit. The interest rates are adjustable and
are based on bank prime rates or other interest rate adjustment indices.
The rate shown is the rate in effect at the date of this statement.
(c) Securities that are not rated which the Fund's Board of Directors have
determined to be of comparable quality to those rated securities in which
the Fund invests.
(d) The maturity date indicated is the next put date.
<TABLE>
<CAPTION>
KEY:
<S> <C><C> <C> <C> <C>
AMBAC = American Municipal Bond Assurance Corporation MBIA = Municipal Bond Insurance Association
BAN = Bond Anticipation Note PCFA = Pollution Control Finance Authority
FGIC = Financial Guaranteed Insurance Company PCR = Pollution Control Revenue
GO = General Obligation PCRB = Pollution Control Revenue Bond
HEFA = Health and Education Facilities Authority RB = Revenue Bond
HFA = Housing Finance Authority ROCS = Reset Options Certificates
IDRB = Industrial Development Revenue Bond TRAN = Tax and Revenue Anticipation Note
LOC = Letter of Credit
</TABLE>
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See Notes to Financial Statements.
<PAGE>
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CONNECTICUT DAILY TAX FREE INCOME FUND, INC.
STATEMENT OF OPERATIONS
YEAR ENDED JANUARY 31, 1999
================================================================================
<TABLE>
<CAPTION>
INVESTMENT INCOME
<S> <C>
Income:
Interest...................................................................... $ 5,837,087
-------------------
Expenses: (Note 2)
Investment management fee..................................................... 521,291
Administration fee............................................................ 364,904
Shareholder servicing fee..................................................... 347,225
Custodian expenses............................................................ 35,093
Shareholder servicing and related shareholder expenses........................ 139,484
Legal, compliance and filing fees............................................. 32,111
Audit and accounting.......................................................... 69,428
Directors' fees............................................................... 15,178
Other......................................................................... 10,141
-------------------
Total expenses............................................................ 1,534,855
-------------------
Net investment income......................................................... 4,302,232
<CAPTION>
REALIZED GAIN (LOSS) ON INVESTMENTS
<S> <C>
Net realized gain (loss) on investments......................................... 546
-------------------
Increase in net assets from operations.......................................... $ 4,302,778
===================
</TABLE>
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See Notes to Financial Statements.
<PAGE>
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CONNECTICUT DAILY TAX FREE INCOME FUND, INC.
STATEMENTS OF CHANGES IN NET ASSETS
YEARS ENDED JANUARY 31, 1999 AND 1998
================================================================================
<TABLE>
<CAPTION>
1999 1998
---------------- -----------------
INCREASE (DECREASE) IN NET ASSETS
<S> <C> <C>
Operations:
Net investment income...................................... $ 4,302,232 $ 3,747,683
Net realized gain (loss) on investments.................... 546 ( 993)
---------------- -----------------
Increase (decrease) in net assets from operations............... 4,302,778 3,746,690
Dividends to shareholders from net investment income:
Class A.................................................... ( 4,298,462)* ( 3,746,628)*
Class B.................................................... ( 3,770)* ( 1,055)*
Capital share transactions (Note 3):
Class A.................................................... 14,447,178 31,174,646
Class B.................................................... 384,423 ( 2,491)
---------------- -----------------
Total increase (decrease).................................. 14,832,147 31,171,162
Net assets:
Beginning of year.......................................... 167,784,089 136,612,927
---------------- -----------------
End of year................................................ $ 182,616,236 $ 167,784,089
================ =================
* Designated as exempt-interest dividends for federal income tax purposes.
</TABLE>
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See Notes to Financial Statements.
<PAGE>
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CONNECTICUT DAILY TAX FREE INCOME FUND, INC.
NOTES TO FINANCIAL STATEMENTS
================================================================================
1. Summary of Accounting Policies.
Connecticut Daily Tax Free Income Fund, Inc. is a no-load, non-diversified,
open-end management investment company registered under the Investment Company
Act of 1940. The Fund has two classes of stock authorized, Class A and Class B.
The Class A shares are subject to a service fee pursuant to the Distribution and
Service Plan. The Class B shares are not subject to a service fee. Additionally,
the Fund may allocate among its classes certain expenses, to the extent
allowable to specific classes, including transfer agent fees, government
registration fees, certain printing and postage costs, and administrative and
legal expenses. Class specific expenses of the Fund were limited to shareholder
servicing fees and transfer agent expenses. In all other respects the Class A
and Class B shares represent the same interest in the income and assets of the
Fund. The Fund is a short-term, tax-exempt money market Fund. Its financial
statements are prepared in accordance with generally accepted accounting
principles for investment companies as follows:
a) Valuation of Securities -
Investments are valued at amortized cost. Under this valuation method, a
portfolio instrument is valued at cost and any discount or premium is
amortized on a constant basis to the maturity of the instrument. The
maturity of variable rate demand instruments is deemed to be the longer of
the period required before the Fund is entitled to receive payment of the
principal amount or the period remaining until the next interest rate
adjustment.
b) Federal Income Taxes -
It is the Fund's policy to comply with the requirements of the Internal
Revenue Code applicable to regulated investment companies and to distribute
all of its tax exempt and taxable income to its shareholders. Therefore, no
provision for federal income tax is required.
c) Dividends and Distributions -
Dividends from investment income (excluding capital gains and losses, if
any, and amortization of market discount) are declared daily and paid
monthly. Distributions of net capital gains, if any, realized on sales of
investments are made after the close of the Fund's fiscal year, as declared
by the Fund's Board of Directors.
d) Use of Estimates -
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that effect 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.
e) General -
Securities transactions are recorded on a trade date basis. Interest income
is accrued as earned. Realized gains and losses from securities
transactions are recorded on the identified cost basis.
2. Investment Management Fees and Other Transactions with Affiliates.
Under the Investment Management Contract, the Fund pays an investment management
fee to Reich & Tang Asset Management L.P. (Manager) at the annual rate of .30%
of the Fund's average daily net assets.
Pursuant to an Administrative Services Contract the Fund pays to the Manager an
annual fee of .21% of the Fund's average daily net assets.
- --------------------------------------------------------------------------------
<PAGE>
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================================================================================
2. Investment Management Fees and Other Transactions with Affiliates.
(Continued)
Pursuant to a Distribution Plan adopted under Securities and Exchange Commission
Rule 12b-1, the Fund and Reich & Tang Distributors, Inc. (the Distributor) have
entered into a Distribution Agreement and a Shareholder Servicing Agreement,
only with respect to Class A shares of the Fund. For its services under the
Shareholder Servicing Agreement, the Distributor receives from the Fund with
respect only to the Class A shares, a fee equal to .20% of the Fund's average
daily net assets. There were no additional expenses borne by the Fund pursuant
to the Distribution Plan.
Fees are paid to Directors who are unaffiliated with the Manager on the basis of
$3,000 per annum plus $500 per meeting attended.
Included in the Statement of Operations under the caption "Shareholder servicing
and related shareholder expenses" are fees of $87,092 paid to Reich & Tang
Services, Inc., an affiliate of the Manager, as servicing agent for the Fund.
3. Capital Stock.
At January 31, 1999, 20,000,000,000 shares of $.001 par value stock were
authorized and capital paid in amounted to $182,623,588. Transactions in capital
stock, all at $1.00 per share, were as follows:
<TABLE>
<CAPTION>
Year Year
Class A Ended Ended
------- January 31, 1999 January 31, 1998
---------------- ----------------
<S> <C> <C>
Sold................................... 324,965,031 294,231,065
Issued on reinvestment of dividends.... 4,392,198 3,475,704
Redeemed............................... ( 314,910,051) ( 266,532,123)
------------- -------------
Net increase (decrease)................ 14,447,178 31,174,646
============= =============
<CAPTION>
Year Year
Class B Ended Ended
------- January 31, 1999 January 31, 1998
---------------- ----------------
<S> <C> <C>
Sold................................... 973,103 1,915,696
Issued on reinvestment of dividends.... 3,412 531
Redeemed............................... ( 592,092) ( 1,918,718)
------------- -------------
Net increase (decrease)................ 384,423 ( 2,491)
============= =============
</TABLE>
4. Sales of Securities.
Accumulated undistributed realized losses at January 31, 1999 amounted to
$7,352. At January 31, 1999 the Fund had tax basis capital losses of $7,898
which may be carried forward to offset future capital gains. Such losses expire
January 31, 2005 through January 31, 2006.
5. Concentration of Credit Risk.
The Fund invests primarily in obligations of political subdivisions of the State
of Connecticut and, accordingly, is subject to the credit risk associated with
the non-performance of such issuers. Approximately 40% of these investments are
further secured, as to principal and interest, by letters of credit issued by
financial institutions. The Fund maintains a policy of monitoring its exposure
by reviewing the creditworthiness of the issuers, as well as that of the
financial institutions issuing the letters of credit, and by limiting the amount
of holdings with letters of credit from one financial institution.
- --------------------------------------------------------------------------------
<PAGE>
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CONNECTICUT DAILY TAX FREE INCOME FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
<TABLE>
<CAPTION>
6. Financial Highlights.
CLASS A Year Ended January 31,
- ------- ---------------------------------------------------------------------
1999 1998 1997 1996 1995
--------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
Per Share Operating Performance:
(for a share outstanding throughout the year)
Net asset value, beginning of year............ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
--------- --------- --------- --------- ---------
Income from investment operations:
Net investment income..................... 0.025 0.027 0.026 0.030 0.023
Less distributions:
Dividends from net investment income...... ( 0.025) ( 0.027) ( 0.026) ( 0.030) ( 0.023)
--------- --------- --------- --------- ---------
Net asset value, end of year.................. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
========= ========= ========= ========= =========
Total Return.................................. 2.52% 2.74% 2.59% 3.02% 2.29%
Ratios/Supplemental Data
Net assets, end of year (000)................. $ 182,227 $ 167,780 $ 136,606 $ 105,826 $ 81,801
Ratios to average net assets:
Expenses.................................. 0.88% 0.89% 0.91% 0.91% 0.88%
Net investment income..................... 2.48% 2.70% 2.56% 2.96% 2.25%
Administration fees waived................ -- -- -- 3.02% 2.02%
Expenses paid indirectly.................. -- -- 0.02% -- --
<CAPTION>
Year Ended October 10, 1996
CLASS B January 31, (Commencement of Offering) to
- ------- ----------------------------- January 31, 1997
1999 1998 ----------------
--------- ---------
<S> <C> <C> <C>
Per Share Operating Performance:
(for a share outstanding throughout the period)
Net asset value, beginning of period.......... $ 1.00 $ 1.00 $ 1.00
--------- --------- ---------
Income from investment operations:
Net investment income..................... 0.027 0.029 0.009
Less distributions:
Dividends from net investment income...... ( 0.027) ( 0.029) ( 0.009)
--------- --------- ---------
Net asset value, end of period................ $ 1.00 $ 1.00 $ 1.00
========= ========= =========
Total Return.................................. 2.72% 2.96% 2.83%*
Ratios/Supplemental Data
Net assets, end of period (000)............... $ 389 $ 4 $ 7
Ratios to average net assets:
Expenses.................................. 0.69% 0.67% 0.70%*
Net investment income..................... 2.50% 2.95% 2.80%*
Expenses paid indirectly.................. -- -- 0.02%*
* Annualized
</TABLE>
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<PAGE>
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CONNECTICUT DAILY TAX FREE INCOME FUND, INC.
INDEPENDENT AUDITOR'S REPORT
================================================================================
The Board of Directors and Shareholders
Connecticut Daily Tax Free Income Fund, Inc.
We have audited the accompanying statement of net assets of Connecticut Daily
Tax Free Income Fund, Inc. as of January 31, 1999, and the related statement of
operations for the year then ended, the statements of changes in net assets for
each of the two years in the period then ended and the financial highlights for
each of the five years in the period then ended. These financial statements and
financial highlights are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
January 31, 1999, by correspondence with the custodian and broker. An audit also
includes assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of
Connecticut Daily Tax Free Income Fund, Inc. as of January 31, 1999, the results
of its operations, the changes in its net assets and the financial highlights
for the periods indicated, in conformity with generally accepted accounting
principles.
\s\McGladrey & Pullen, LLP
New York, New York
February 26, 1999
- --------------------------------------------------------------------------------
<PAGE>
- --------------------------------------------------------------------------------
CONNECTICUT
DAILY
TAX FREE
INCOME
FUND, INC.
Annual Report
January 31, 1999
- --------------------------------------------------------------------------------
<PAGE>
- --------------------------------------------------------------------------------
- ------------------------------------------------------
This report is submitted for the general information
of the shareholders of the Fund. It is not
authorized for distribution to prospective investors
in the Fund unless preceded or accompanied by an
effective prospectus, which includes information
regarding the Fund's objectives and policies,
experience of its management, marketability of
shares, and other information.
- ------------------------------------------------------
Connecticut Daily Tax Free Income Fund, Inc.
600 Fifth Avenue
New York, New York 10020
Manager
Reich & Tang Asset Management L.P.
600 Fifth Avenue
New York, New York 10020
Custodian
Investors Fiduciary Trust Company
801 Pennsylvania
Kansas City, Missouri 64105
Transfer Agent &
Dividend Disbursing Agent
Reich & Tang Services, Inc.
600 Fifth Avenue
New York, New York 10020
CONN199AN
- --------------------------------------------------------------------------------
<PAGE>
