LETTER TO SHAREHOLDERS
Dear Shareholder:
As your Fund ended its semi-annual reporting period on November 30, 1994,
its net asset value was $14.93 per share. Income dividends of approximately
$.45 per share were paid during this period, representing an annualized
distribution rate per share of 6.06% based on the November 30, 1994 closing
price. In addition, we are pleased to report that all dividends paid from net
investment income during this period were exempt from Federal and
Commonwealth of Massachusetts income taxes, although certain shareholders may
be subject to the Federal Alternative Minimum Tax (AMT) on some portfolio
income.
The municipal market continued its decline over the reporting period as
the economy continued to grow and, with that, as inflationary fears
increased. While some acceleration in the economy had been expected, the
robust growth experienced over the past months was clearly a surprise to most
economists and market participants alike. It had been anticipated that the
higher interest rates engendered by the Federal Reserve Board's tighter
monetary policy, beginning in the first quarter of this year, would clearly
slow economic expansion by year-end.
As of this writing, there are few signs that the economy is slowing. In
fact, a wide array of economic indexes are showing growth at levels that have
proven to be accurate forecasters of upward inflationary trends in past
recoveries. As an example, retail spending began rising in July and has
continued unabated into the seasonally strong Christmas season. Through
November, wholesale price inflation was running at a 1.6% annual rate,
compared with 0.4% for the same period a year earlier and 0.2% for all of
1993. Housing starts, reported recently by the Commerce Department for
November, rose to their highest level in eight months. In addition, job gains
remain strong, and jobless claims continue to go lower while capacity
utilization rates have risen rapidly and are now near the peak level of the
last cycle. Lastly, commodity prices continue on a volatile but upward path
when compared to the past several years.
There are some positive signs that the economy, while growing near a 4%
annual rate, may be able to avoid an inflationary surge. For example, the
increases in commodity prices have as yet not been evident in prices paid by
the consumer, but it may only be a matter of time before this occurs.
Likewise, wage inflation remains practically nonexistent, but it
traditionally lags a strong economic upsurge. Another positive sign that the
economy may be able to avoid an inflationary surge is the flattening yield
curve for government securities. This generally is evidence that the market
believes that the economy will slow in the coming months, making longer
maturity securities more attractive.
Currently, the Federal Reserve Board appears to be reluctant to increase
rates further until potential market disruptions such as Orange County's
difficulties have been addressed. However, a strong Christmas retail season
and any signs of wage and/or consumer price inflation could lead to rapid
rate action by the Board early in 1995.
Our strategy in this environment is one of caution. We believe that
inflationary pressures will rise in the coming months, but that vigilance by
the Fed will limit these increases, and that interest rates will peak by
midyear. We have raised our cash position and sold lower coupon issues to
limit the effects of the market's volatility on the Fund in this environment.
The Massachusetts economy has continued to perform admirably, and State
government fiscal policy continues on a sound path. These positive credit
qualities have led to improved liquidity and price appreciation in
Massachusetts bond issues in the past several years. We expect these positive
economic and fiscal trends to continue and to benefit your portfolio.
We have included a current Statement of Investments and recent financial
statements for your review. We greatly appreciate
your investment in the Fund and look forward to serving your investment needs
in the future.
Very truly yours,
(logo signature)
Richard J. Moynihan
Director, Municipal Portfolio Management
The Dreyfus Corporation
December 19, 1994
New York, N.Y.
<TABLE>
<CAPTION>
DREYFUS MASSACHUSETTS TAX EXEMPT BOND FUND
STATEMENT OF INVESTMENTS NOVEMBER 30, 1994 (UNAUDITED)
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS-98.6% AMOUNT VALUE
------------ ------------
<S> <C> <C>
MASSACHUSETTS-93.1%
Boston:
6.75%, 7/1/2011 (Insured; MBIA, Prerefunded 7/1/2001) (a)............... $ 2,500,000 $ 2,656,950
6.50%, 7/1/2012 (Insured; AMBAC)........................................ 3,000,000 2,959,620
Boston City Hospital, Revenue, Refunding 5.75%, 2/15/2013 (Insured; FHA).... 2,000,000 1,750,220
Boston - Mount Pleasant Housing Development Corp., MFHR, Refunding
6.75%, 8/1/2023 (Insured; FHA).......................................... 1,700,000 1,613,402
Boston Water and Sewer Commission, Revenue 6%, 11/1/2021 (Insured; FGIC).... 4,000,000 3,557,560
Massachusetts Bay Transportation Authority:
6.40%, 3/1/2015 (Guaranteed; Massachusetts Commonwealth)................ 3,000,000 3,133,620
Refunding 6.20%, 3/1/2016............................................... 1,225,000 1,116,012
Massachusetts Commonwealth:
Consolidated Loan:
6%, 6/1/2011.......................................................... 3,500,000 3,195,675
6%, 7/1/2012.......................................................... 2,000,000 1,810,560
Refunding:
5.25%, 2/1/2008....................................................... 1,500,000 1,279,830
6%, Series A, 8/1/2012................................................ 2,000,000 1,810,020
6%, Series B, 8/1/2012 (Insured; FGIC)................................ 1,755,000 1,608,299
Special Obligation Revenue 5.80%, 6/1/2014.............................. 5,000,000 4,371,650
Massachusetts Convention Center Authority (Boston Common Parking Garage)
5.375%, 9/1/2013........................................................ 2,250,000 1,871,145
Massachusetts Education Loan Authority, Education Loan Revenue
8%, 6/1/2002 (LOC; Rabobank Nederland) (b).............................. 790,000 838,925
Massachusetts Health and Educational Facilities Authority, Revenue:
(Amherst College) 6.375%, 11/1/2019..................................... 1,000,000 931,150
(Berklee College of Music) 6.875%, 10/1/2021 (Insured; MBIA)............ 4,380,000 4,323,980
(Boston University) 6%, 10/1/2022 (Insured; MBIA)....................... 1,175,000 1,035,622
(Jordan Hospital) 7.85%, 8/15/2028 (Insured; FHA, Prerefunded 8/15/1998) (a) 3,325,000 3,606,328
(Lahey Clinic Medical Center):
5.625%, 7/1/2015 (Insured; MBIA)...................................... 3,085,000 2,610,990
5.375%, 7/1/2023 (Insured; MBIA)...................................... 1,000,000 790,030
(Massachusetts General Hospital):
6.25%, 7/1/2020 (Insured; AMBAC)...................................... 3,500,000 3,170,020
Refunding:
6%, 7/1/2015 (Insured; AMBAC)..................................... 2,000,000 1,785,440
5.25%, 7/1/2023 (Insured; AMBAC).................................. 2,000,000 1,549,660
(Mclean Hospital) 6.50%, 7/1/2010 (Insured; FGIC)....................... 1,000,000 972,290
(New England Medical Center Hospitals) 6.50%, 7/1/2012 (Insured; FGIC).. 1,000,000 958,550
(Refunding - Baystate Medical Center) 6%, 7/1/2015 (Insured; FGIC)...... 1,140,000 1,017,701
(Refunding - Milton Hospital) 7%, 7/1/2016 (Insured; MBIA).............. 1,000,000 1,004,570
(Youville Hospital):
8.875%, 8/1/2004 (Insured; FHA)....................................... 1,295,000 1,375,756
9.10%, 8/1/2015 (Insured; FHA)........................................ 2,030,000 2,161,706
DREYFUS MASSACHUSETTS TAX EXEMPT BOND FUND
STATEMENT OF INVESTMENTS (CONTINUED) NOVEMBER 30, 1994 (UNAUDITED)
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
------------ ------------
MASSACHUSETTS (CONTINUED)
Massachusetts Housing Finance Agency, Revenue:
Housing Projects, Refunding:
6.15%, 10/1/2015...................................................... $ 3,365,000 $ 3,039,806
6.375%, 4/1/2021...................................................... 3,000,000 2,699,490
Multi-Family Residential Housing 9.60%, 8/1/2022........................ 1,795,000 1,826,879
Rental 6.75%, 7/1/2028 (Insured; AMBAC)................................. 2,870,000 2,662,872
Residential Development 6.25%, 11/15/2012 (Collateralized; FNMA)........ 4,100,000 3,764,743
Single-Family Housing:
5.60%, 6/1/2025....................................................... 1,300,000 1,069,081
6.60%, 12/1/2026...................................................... 3,000,000 2,693,970
Massachusetts Industrial Finance Agency, Revenue:
Electrical Utility (Nantucket Electric Co.) 8.50%, 3/1/2016............. 3,000,000 3,080,370
(Refunding-Harvard Community Health) 8.125%, 10/1/2017.................. 4,000,000 4,236,240
(Refunding-Holy Cross College):
6%, 11/1/2002......................................................... 400,000 398,980
6.375%, 11/1/2015..................................................... 2,000,000 1,869,840
Massachusetts Municipal Wholesale Electric Co., Power Supply System Revenue,
Refunding:
6.40%, 7/1/2002....................................................... 400,000 404,032
6.625%, 7/1/2018...................................................... 3,500,000 3,337,565
6.125%, 7/1/2019...................................................... 2,500,000 2,244,875
Massachusetts Port Authority, Revenue:
6%, 7/1/2013............................................................ 2,050,000 1,846,353
9.375%, 7/1/2015........................................................ 325,000 337,337
9.375%, 7/1/2015 (Prerefunded 7/1/1995) (a)............................. 675,000 707,697
6%, 7/1/2023............................................................ 5,000,000 4,297,950
Special Project (Harborside Hyatt) 10%, 3/1/2026........................ 8,000,000 8,545,440
Massachusetts Water Resources Authority:
5.25%, 3/1/2013......................................................... 4,550,000 3,748,154
6.50%, 12/1/2019 (Prerefunded 12/1/2001) (a)............................ 2,750,000 2,889,837
New Bedford 5.75%, 3/1/2006................................................. 1,565,000 1,417,577
New England Education Loan Marketing Corp., Student Loan Revenue:
5.40%, 6/1/2000......................................................... 2,000,000 1,917,360
6.90%, 11/1/2009........................................................ 3,000,000 3,005,280
Quincy, Revenue (Quincy City Hospital):
7.875%, 1/15/2016 (Insured; FHA, Prerefunded 7/1/1996) (a).............. 2,400,000 2,551,272
Refunding:
5%, 1/15/2005 (Insured; FSA).......................................... 2,000,000 1,724,900
5.25%, 1/15/2016 (Insured; FSA)....................................... 2,000,000 1,598,040
Southbridge 6.375%, 1/1/2012 (Insured; AMBAC)............................... 1,000,000 955,420
Worcester, IDR (National Envelope Corp. Project)
8%, 12/1/2004 (LOC; Manufacturers Hanover Trust Co.) (b)................ 4,000,000 4,267,600
DREYFUS MASSACHUSETTS TAX EXEMPT BOND FUND
STATEMENT OF INVESTMENTS (CONTINUED) NOVEMBER 30, 1994 (UNAUDITED)
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
------------ ------------
U.S. RELATED-5.5%
Guam Airport Authority, Revenue 6.70%, 10/1/2023............................ $ 3,000,000 $ 2,701,680
Puerto Rico Electric Power Authority, Power Revenue 6.25%, 7/1/2017......... 2,000,000 1,822,440
Virgin Islands Water and Power Authority, Electric System Revenue 7.40%, 7/1/2011 3,450,000 3,430,128
------------
TOTAL LONG-TERM MUNICIPAL INVESTMENTS (cost $148,134,984)................... $141,960,489
============
SHORT-TERM MUNICIPAL INVESTMENTS-1.4%
MASSACHUSETTS;
Massachusetts Health and Educational Facilities Authority, Revenue, VRDN
(Saint Elizabeth Hospital) 3.535% (Insured; FSA) (c)
(cost $2,000,000)....................................................... $ 2,000,000 $ 2,000,000
============
TOTAL INVESTMENTS-100.0%
(cost $150,134,984)..................................................... $143,960,489
============
</TABLE>
<TABLE>
<CAPTION>
SUMMARY OF ABBREVIATIONS
<S> <C> <S> <C>
AMBAC American Municipal Bond Assurance Corporation IDR Industrial Development Revenue
FGIC Financial Guaranty Insurance Company LOC Letter of Credit
FHA Federal Housing Administration MBIA Municipal Bond Investors Assurance
FNMA Federal National Mortgage Association MFHR Multi-Family Housing Revenue
FSA Financial Security Assurance VRDN Variable Rate Demand Notes
</TABLE>
<TABLE>
<CAPTION>
SUMMARY OF COMBINED RATINGS
FITCH (D) OR MOODY'S OR STANDARD & POOR'S PERCENTAGE OF VALUE
- -------- ------- ----------------- -------------------
<S> <C> <S> <C>
AAA Aaa AAA 40.9%
AA Aa AA 16.8
A A A 29.0
BBB Baa BBB 5.2
Not Rated Not Rated Not Rated 8.1
-----
100.0%
======
</TABLE>
NOTES TO STATEMENT OF INVESTMENTS:
(a) Bonds which are prerefunded are collateralized by U.S. Government
Securities which are held in escrow and are used to pay principal and
interest on the municipal issue and to retire the bonds in full at the
earliest refunding date.
(b) Secured by letters of credit.
(c) The interest rate, which is subject to change, is based upon bank
prime rates or an index of market interest rates.
(d) Fitch currently provides creditworthiness information for a limited
number of investments.
See independent accountants' review report and notes to financial statements.
<TABLE>
<CAPTION>
DREYFUS MASSACHUSETTS TAX EXEMPT BOND FUND
STATEMENT OF ASSETS AND LIABILITIES NOVEMBER 30, 1994 (UNAUDITED)
<S> <C> <C>
ASSETS:
Investments in securities, at value
(cost $150,134,984)_see statement..................................... $143,960,489
Interest receivable..................................................... 3,182,416
Receivable for shares of Beneficial Interest subscribed................. 150,000
Prepaid expenses........................................................ 10,852
------------
147,303,757
LIABILITIES:
Due to The Dreyfus Corporation.......................................... $ 59,645
Due to Custodian........................................................ 368,613
Accrued expenses........................................................ 62,045 490,303
---------- -----------
NET ASSETS ................................................................ $146,813,454
============
REPRESENTED BY:
Paid-in capital......................................................... $156,428,169
Accumulated net realized capital losses and distributions in excess of
net realized gain on investments...................................... (3,440,220)
Accumulated net unrealized (depreciation) on investments-Note 3......... (6,174,495)
------------
NET ASSETS at value applicable to 9,836,475 outstanding shares of
Beneficial Interest, equivalent to $14.93 per share (unlimited
number of $.01 par value shares authorized)............................. $146,813,454
============
STATEMENT OF OPERATIONS SIX MONTHS ENDED NOVEMBER 30, 1994 (UNAUDITED)
INVESTMENT INCOME:
INTEREST INCOME......................................................... $ 5,186,907
EXPENSES:
Management fee_Note 2(a).............................................. $ 473,567
Shareholder servicing costs_Note 2(b)................................. 113,026
Professional fees..................................................... 14,048
Custodian fees........................................................ 8,090
Registration fees..................................................... 6,555
Trustees' fees and expenses_Note 2(c)................................. 5,264
Prospectus and shareholders' reports.................................. 4,381
Miscellaneous......................................................... 9,437
------------
TOTAL EXPENSES.................................................... 634,368
------------
INVESTMENT INCOME-NET............................................. 4,552,539
REALIZED AND UNREALIZED (LOSS) ON INVESTMENTS:
Net realized (loss) on investments_Note 3............................... $ (856,842)
Net unrealized (depreciation) on investments............................ (10,131,669)
------------
NET REALIZED AND UNREALIZED (LOSS) ON INVESTMENTS................. (10,988,511)
------------
NET (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS...................... $(6,435,972)
============
See independent accountants' review report and notes to financial statements.
</TABLE>
<TABLE>
<CAPTION>
DREYFUS MASSACHUSETTS TAX EXEMPT BOND FUND
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED SIX MONTHS ENDED
MAY 31, NOVEMBER 30, 1994
1994 (UNAUDITED)
------------ -------------
<S> <C> <C>
OPERATIONS:
Investment income_net................................................ $ 9,841,803 $ 4,552,539
Net realized (loss) on investments................................... (1,956,469) (856,842)
Net unrealized (depreciation) on investments for the period.......... (3,680,332) (10,131,669)
------------ -------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS.... 4,205,002 (6,435,972)
------------ -------------
DIVIDENDS TO SHAREHOLDERS:
From investment income_net.......................................... (9,922,292) (4,552,539)
From net realized gain on investments................................ (2,229,211) --
In excess of net realized gain on investments........................ (2,583,378) --
------------ -------------
TOTAL DIVIDENDS.................................................... (14,734,881) (4,552,539)
------------ -------------
BENEFICIAL INTEREST TRANSACTIONS:
Net proceeds from shares sold........................................ 47,458,511 20,539,245
Dividends reinvested................................................. 11,443,149 3,405,481
Cost of shares redeemed.............................................. (63,499,837) (34,615,712)
------------ -------------
(DECREASE) IN NET ASSETS FROM BENEFICIAL INTEREST TRANSACTIONS..... (4,598,177) (10,670,986)
------------ -------------
TOTAL (DECREASE) IN NET ASSETS................................. (15,128,056) (21,659,497)
NET ASSETS:
Beginning of period.................................................. 183,601,007 168,472,951
------------ -------------
End of period........................................................ $168,472,951 $146,813,454
------------ -------------
SHARES SHARES
------------ -------------
CAPITAL SHARE TRANSACTIONS:
Shares sold.......................................................... 2,815,211 1,315,557
Shares issued for dividends reinvested............................... 673,634 218,079
Shares redeemed...................................................... (3,772,878) (2,205,648)
------------ -------------
NET (DECREASE) IN SHARES OUTSTANDING............................... (284,033) (672,012)
============= =============
See independent accountants' review report and notes to financial statements.
</TABLE>
<TABLE>
<CAPTION>
DREYFUS MASSACHUSETTS TAX EXEMPT BOND FUND
FINANCIAL HIGHLIGHTS
Contained below is per share operating performance data for a share of
Beneficial Interest outstanding, total investment return, ratios to average
net assets and other supplemental data for each period indicated. This
information has been derived from the Fund's financial statements.
SIX MONTHS ENDED
YEAR ENDED MAY 31, NOVEMBER 30, 1994
-------------------------------------------------- ----------------
PER SHARE DATA: 1990 1991 1992 1993 1994 (UNAUDITED)
---- ---- ---- ---- ---- ------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period.... $15.66 $15.43 $15.59 $16.20 $17.01 $16.03
------ ------ ------ ------ ------ ------
INVESTMENT OPERATIONS:
Investment income-net............... 1.08 1.06 1.01 .97 .91 .45
Net realized and unrealized gain (loss) on
investments....................... (.23) .16 .60 .81 (.52) (1.10)
------ ------ ------ ------ ------ ------
TOTAL FROM INVESTMENT OPERATIONS.. .85 1.22 1.61 1.78 .39 (.65)
------ ------ ------ ------ ------ ------
DISTRIBUTIONS:
Dividends from investment income-net (1.08) (1.06) (1.00) (.97) (.92) (.45)
Dividends from net realized gain on
investments....................... -- -- -- -- (.21) --
Dividends in excess of net realized gain
on investments.................... -- -- -- -- (.24) --
------ ------ ------ ------ ------ ------
TOTAL DISTRIBUTIONS............... (1.08) (1.06) (1.00) (.97) (1.37) (.45)
------ ------ ------ ------ ------ ------
Net asset value, end of period...... $15.43 $15.59 $16.20 $17.01 $16.03 $14.93
====== ====== ====== ====== ====== ======
TOTAL INVESTMENT RETURN 5.58% 8.20% 10.62% 11.27% 2.07% (8.22%)(1)
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets .83% .81% .84% .81% .80% .80%(1)
Ratio of net investment income to average
net assets........................ 6.92% 6.87% 6.30% 5.83% 5.30% 5.77%(1)
Portfolio Turnover Rate............. 55.02% 49.73% 68.07% 85.29% 29.73% 12.39%(2)
Net Assets, end of period (000's Omitted) $107,861 $120,540 $157,061 $183,601 $168,473 $146,813
(1) Annualized.
(2) Not annualized.
</TABLE>
See independent accountants' review report and notes to financial statements.
DREYFUS MASSACHUSETTS TAX EXEMPT BOND FUND
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
NOTE 1_SIGNIFICANT ACCOUNTING POLICIES:
The Fund is registered under the Investment Company Act of 1940 ("Act")
as a non-diversified open-end management investment company. Dreyfus Service
Corporation, until August 24, 1994, acted as the exclusive distributor of the
Fund's shares, which are sold to the public without a sales charge. Dreyfus
Service Corporation is a wholly-owned subsidiary of The Dreyfus Corporation
("Manager"). Effective August 24, 1994, the Manager became a direct
subsidiary of Mellon Bank, N.A.
On August 24, 1994, Premier Mutual Fund Services, Inc. (the
"Distributor") was engaged as the Fund's distributor. The Distributor,
located at One Exchange Place, Boston, Massachusetts 02109, is a wholly-owned
subsidiary of Institutional Administration Services, Inc., a provider of
mutual fund administration services, the parent company of which is Boston
Institutional Group, Inc.
(A) PORTFOLIO VALUATION: The Fund's investments are valued each business
day by an independent pricing service ("Service") approved by the Board of
Trustees. Investments for which quoted bid prices are readily available and
are representative of the bid side of the market in the judgment of the
Service are valued at the mean between the quoted bid prices (as obtained by
the Service from dealers in such securities) and asked prices (as calculated
by the Service based upon its evaluation of the market for such securities).
Other investments (which constitute a majority of the portfolio securities)
are carried at fair value as determined by the Service, based on methods
which include consideration of: yields or prices of municipal securities of
comparable quality, coupon, maturity and type; indications as to values from
dealers; and general market conditions.
(B) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities
transactions are recorded on a trade date basis. Realized gain and loss from
securities transactions are recorded on the identified cost basis. Interest
income, adjusted for amortization of premiums and original issue discounts on
investments, is earned from settlement date and recognized on the accrual
basis. Securities purchased or sold on a when-issued or delayed-delivery
basis may be settled a month or more after the trade date.
The Fund follows an investment policy of investing primarily in municipal
obligations of one state. Economic changes affecting the state and certain of
its public bodies and municipalities may affect the ability of issuers within
the state to pay interest on, or repay principal of, municipal obligations
held by the Fund.
(C) DIVIDENDS TO SHAREHOLDERS: It is the policy of the Fund to declare
dividends daily from investment income-net. Such dividends are paid monthly.
Dividends from net realized capital gain, if any, are normally declared and
paid annually, but the Fund may make distributions on a more frequent basis
to comply with the distribution requirements of the Internal Revenue Code. To
the extent that net realized capital gain can be offset by capital loss
carryovers, if any, it is the policy of the Fund not to distribute such gain.
(D) FEDERAL INCOME TAXES: It is the policy of the Fund to continue to
qualify as a regulated investment company, which can distribute tax exempt
dividends, by complying with the applicable provisions of the Internal
Revenue Code, and to make distributions of income and net realized capital
gain sufficient to relieve it from substantially all Federal income and
excise taxes.
DREYFUS MASSACHUSETTS TAX EXEMPT BOND FUND
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
NOTE 2_MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES:
(A) Pursuant to a management agreement ("Agreement") with the Manager,
the management fee is computed at the annual rate of .60 of 1% of the average
daily value of the Fund's net assets and is payable monthly. The Agreement
provides for an expense reimbursement from the Manager should the Fund's
aggregate expenses, exclusive of taxes, brokerage, interest on borrowings and
extraordinary expenses, exceed the expense limitation of any state having
jurisdiction over the Fund for any full fiscal year. The most stringent state
expense limitation applicable to the Fund presently requires reimbursement of
expenses in any full fiscal year that such expenses (exclusive of certain
expenses as described above) exceed 2 1/2% of the first $30 million, 2% of
the next $70 million and 1 1/2% of the excess over $100 million of the
average value of the Fund's net assets in accordance with California "blue
sky" regulations. There was no expense reimbursement for the six months ended
November 30, 1994.
(B) Pursuant to the Fund's Shareholder Services Plan, the Fund reimburses
Dreyfus Service Corporation an amount not to exceed an annual rate of .25 of
1% of the value of the Fund's average daily net assets for servicing
shareholder accounts. The services provided may include personal services
relating to shareholder accounts, such as answering shareholder inquiries
regarding the Fund and providing reports and other information, and services
related to the maintenance of shareholder accounts. During the six months
ended November 30, 1994, the Fund was charged an aggregate of $45,737
pursuant to the Shareholder Services Plan.
(C) Prior to August 24, 1994, certain officers and trustees of the Fund
were "affiliated persons," as defined in the Act, of the Manager and/or
Dreyfus Service Corporation. Each trustee who is not an "affiliated person"
receives an annual fee of $1,500 and an attendance fee of $250 per meeting.
NOTE 3_SECURITIES TRANSACTIONS:
The aggregate amount of purchases and sales of investment securities
amounted to $34,151,808 and $43,455,159, respectively, for the six months
ended November 30, 1994, and consisted entirely of long-term and short-term
municipal investments.
At November 30, 1994, accumulated net unrealized depreciation on
investments was $6,174,495, consisting of $2,805,881 gross unrealized
appreciation and $8,980,376 gross unrealized depreciation.
At November 30, 1994, the cost of investments for Federal income tax
purposes was substantially the same as the cost for financial reporting
purposes (see the Statement of Investments).
DREYFUS MASSACHUSETTS TAX EXEMPT BOND FUND
REVIEW REPORT OF ERNST & YOUNG LLP, INDEPENDENT ACCOUNTANTS
SHAREHOLDERS AND BOARD OF TRUSTEES
DREYFUS MASSACHUSETTS TAX EXEMPT BOND FUND
We have reviewed the accompanying statement of assets and liabilities of
Dreyfus Massachusetts Tax Exempt Bond Fund, including the statement of
investments, as of November 30, 1994, and the related statements of
operations and changes in net assets and financial highlights for the six
month period ended November 30, 1994. These financial statements and
financial highlights are the responsibility of the Fund's management.
We conducted our review in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures
to financial data, and making inquiries of persons responsible for financial
and accounting matters. It is substantially less in scope than an audit
conducted in accordance with generally accepted auditing standards, which
will be performed for the full year with the objective of expressing an
opinion regarding the financial statements and financial highlights taken as
a whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that
should be made to the interim financial statements and financial highlights
referred to above for them to be in conformity with generally accepted
accounting principles.
We have previously audited, in accordance with generally accepted
auditing standards, the statement of changes in net assets for the year ended
May 31, 1994 and financial highlights for each of the five years in the
period ended May 31, 1994 and in our report dated July 9, 1994, we expressed
an unqualified opinion on such statement of changes in net assets and
financial highlights.
(logo signature)
New York, New York
January 4, 1995
Dreyfus Massachusetts
Tax Exempt Bond Fund
200 Park Avenue
New York, NY 10166
Manager
THE DREYFUS CORPORATION
200 PARK AVENUE
NEW YORK, NY 10166
Custodian
THE BANK OF NEW YORK
90 WASHINGTON STREET
NEW YORK, NY 10286
Transfer Agent &
Dividend Disbursing Agent
THE SHAREHOLDER SERVICES GROUP, INC.
P.O. BOX 9671
PROVIDENCE, RI 02940
FURTHER INFORMATION IS CONTAINED
IN THE PROSPECTUS, WHICH MUST
PRECEDE OR ACCOMPANY THIS REPORT.
PRINTED IN U.S.A. 267SA9411
Massachusetts
Tax Exempt
Bond Fund
Semi-Annual
Report
November 30, 1994
