<PAGE> 1
October 4, 1996
Dear Fellow Shareholders:
On behalf of all of us at Heritage Asset Management, thank you for your
continuing investment in Heritage Cash Trust Municipal Money Market Fund (the
"Fund"). Over your Fund's most recent fiscal year ended August 31, 1996, total
net assets increased from $283 million to $326 million. During the same period,
the seven-day effective yield for your Fund was relatively stable. After falling
from 3.01% on August 31, 1995 to 2.83% on February 29, 1996, rates have
increased slightly, reaching 2.93% on August 31 of this year.
For much of the past year, we have all seen headlines speculating about the
growth rate of our domestic economy. Are we growing too fast, or too
slowly -- and what will the Federal Reserve Board do to slow the growth or speed
it up? The Fed lowered their Federal funds rate target twice in the first half
of your Fund's fiscal year but have made no further changes since February. As
long as the economy maintains a steady growth rate, we believe that the Fed will
not take any action in the next several months to cause short-term rates to
change significantly.
Since our semiannual report was mailed to you, your Fund was rated AAAm by
Standard & Poor's Ratings Group. This rating reflects the fact that we follow
even more restrictive investment criteria in managing your Fund than required by
the Securities and Exchange Commission. We also continue to provide a wide range
of services that, we hope, make your Fund extremely convenient for you to use.
These services include free checking, daily sweeps to and from your brokerage
accounts and automatic payment programs. If there are ever any ways in which you
believe we could better serve you, please call us at 800-709-3863.
In our semiannual report, we mentioned that the Securities and Exchange
Commission ("SEC") has issued regulations modifying certain rules under which
money market funds operate. The effective date for these new regulations, which
was scheduled for October 3, 1996, has been delayed by the SEC pending possible
further amendments. We do not expect that these changes will cause any
significant change to the way in which your Fund is managed.
Please remember that if you are subject to the alternative minimum tax, a
portion of the Fund's income may be considered a preference item for tax
purposes. Also, for those of you subject to a state income tax, the income your
Fund earns from securities issued in your state may be exempt from your state
income tax. We will send you more information about these items in early 1997.
Thank you again for your confidence in entrusting us with a portion of your
investment portfolio.
Sincerely,
/s/ Stephen G. Hill
-------------------
Stephen G. Hill
President
<PAGE> 2
- --------------------------------------------------------------------------------
HERITAGE CASH TRUST -- MUNICIPAL MONEY MARKET FUND
STATEMENT OF NET ASSETS
AUGUST 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL MATURITY/PUT
AMOUNT DATE* VALUE
- ------------- ------------ ------------
<C> <S> <C> <C>
NOTES, BONDS & VARIABLE RATE DEMAND NOTES--99.7%(A)
ALABAMA--3.1%
$ 10,000,000 Jefferson County, 3.50% (b)
Sewer Revenue Bond, Series 95A
LOC: Bayerische Landesbank.............................................. 09/07/96 $ 10,000,000
------------
ALASKA--0.3%
1,000,000 Alaska International Airport, 3.70%
Series 93H, MBIA........................................................ 10/01/96 999,955
------------
ARIZONA--1.7%
5,000,000 Arizona School District, 4.40%
Tax Anticipation Note
Phoenix Union #210, Series 96........................................... 07/31/97 5,017,536
500,000 Pima County, 3.50% (b)
Pollution Control Revenue Bond
Tucson Electric Company Project, Series 82
LOC: Societe Generale................................................... 09/07/96 500,000
------------
5,517,536
------------
ARKANSAS--2.4%
2,100,000 Clark County, 3.60%(b)
Solid Waste Revenue Bond
Reynolds Metals Project, Series 93, AMT
LOC: Trust Company Bank................................................. 09/07/96 2,100,000
5,600,000 Jacksonville, 3.55% (b)
Industrial Development Revenue Bond
Regalware, Inc.
LOC: NBD Corporation.................................................... 09/30/96 5,600,000
------------
7,700,000
------------
CALIFORNIA--6.0%
5,000,000 California GO, 4.50%
Revenue Anticipation Note, Series 96/97................................. 06/30/97 5,021,085
5,000,000 California Housing Finance Authority, 4.00%
Single Family Mortgage Revenue Bond
Home Mortgage Revenue, Series 96J
GIC: Financial Guaranty Insurance Company............................... 07/24/97 5,000,000
5,000,000 Riverside County, GO, 4.625%
Revenue Anticipation Note
School Financing Authority, Series 96................................... 07/17/97 5,024,113
4,600,000 Stanislaus County, GO, 4.50%
Tax and Revenue Anticipation Note
Office of Education, Series 96.......................................... 06/30/97 4,618,281
------------
19,663,479
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
2
<PAGE> 3
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HERITAGE CASH TRUST -- MUNICIPAL MONEY MARKET FUND
STATEMENT OF NET ASSETS
AUGUST 31, 1996
(CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL MATURITY/PUT
AMOUNT DATE* VALUE
- ------------- ------------ ------------
<C> <S> <C> <C>
COLORADO--3.6%
$ 8,000,000 Aurora County, 3.85% (b)
Multi Family Housing Revenue Bond
Aurora Meadows Apartments, Series 96, AMT
LOC: Federal National Mortgage Association.............................. 09/07/96 $ 8,000,000
2,000,000 Colorado Student Obligation Authority, 3.45% (b)
Student Loan Revenue Bond, Series 93B, AMT
LOC: Student Loan Marketing Association................................. 09/07/96 2,000,000
1,700,000 El Paso County, 3.50% (b)
Multi Family Housing Revenue Bond
Briar Glen Apartments, Series 95
LOC: General Electric Credit Corporation................................ 09/07/96 1,700,000
------------
11,700,000
------------
FLORIDA--0.6%
2,000,000 Palm Beach, 3.50% (b)
Multi Family Housing Revenue Bond
Lake Crystal, Series 88A, AMT
LOC: Citibank........................................................... 09/07/96 2,000,000
------------
GEORGIA--0.8%
2,550,000 Cobb County Development Authority, 3.60% (b)
Industrial Development Revenue Bond
Amoena Corporation Project, Series 92, AMT
LOC: Bayerische Hypobank................................................ 09/07/96 2,550,000
------------
IDAHO--1.5%
5,000,000 Boise, GO, 4.00%
Revenue Anticipation Note, Series 95B................................... 09/13/96 5,001,037
------------
ILLINOIS--8.9%
1,100,000 Bolingbrook, 3.60% (b)
Multi Family Housing Revenue Bond
Amberton Apartments, Series 94, AMT
LOC: Lasalle National Trust, N.A........................................ 09/07/96 1,100,000
1,080,000 Chicago, 3.50% (b)
Airport System Revenue Bond, Series 84A
LOC: Societe Generale................................................... 09/07/96 1,080,000
10,200,000 Chicago, 3.60% (b)
Airport Revenue Bond
O'Hare International Airport, Series 88A
LOC: Bayerische Landesbank.............................................. 09/07/96 10,200,000
7,900,000 Illinois Development Finance Authority, 3.50% (b)
Multi Family Housing Revenue Bond
Williamsburg Apartments, Series 91, AMT
LOC: Landesbank Hessen -- Thueringen G.Z................................ 09/07/96 7,900,000
6,000,000 Lisle Housing Finance Authority, 3.55% (b)
Multi Family Housing Revenue Bond
Devonshire Project, Series 91, AMT
LOC: American National Bank of Chicago.................................. 09/07/96 6,000,000
2,700,000 Southwestern, 3.65% (b)
Industrial Development Revenue Bond
Robinson Steel Company, Series 91
LOC: American National Bank of Chicago.................................. 09/07/96 2,700,000
------------
28,980,000
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
3
<PAGE> 4
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HERITAGE CASH TRUST -- MUNICIPAL MONEY MARKET FUND
STATEMENT OF NET ASSETS
AUGUST 31, 1996
(CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL MATURITY/PUT
AMOUNT DATE* VALUE
- ------------- ------------ ------------
<S> <C> <C> <C>
INDIANA--5.7%
$ 1,785,000 Bluffton, 3.60% (b)
Industrial Development Revenue Bond
Snider Tire, Series 95, AMT
LOC: Wachovia Bank and Trust............................................ 09/07/96 $ 1,785,000
1,815,000 City of Columbus, 3.65% (b)
Industrial Development Revenue Bond
Columbus Container, Series 89A, AMT
LOC: Bank One, Columbus, N.A............................................ 09/07/96 1,815,000
2,640,000 City of Crawfordsville, 3.80% (b)
Industrial Development Revenue Bond
Precision Plastics of Indiana, Series 92
LOC: Northern Trust Company............................................. 09/07/96 2,640,000
4,000,000 Indiana Bond Bank, GO, 4.25%
Advance Funding Program Note, Series 96
GIC: Westdeutsche--Landesbank G.Z....................................... 01/09/97 4,010,324
2,000,000 City of Indianapolis, 3.65% (b)
Industrial Development Revenue Bond
Altec Industries, Inc., Project, Series 89, AMT
LOC: Wachovia Bank and Trust............................................ 09/07/96 2,000,000
1,800,000 Jeffersonville, 3.80% (b)
Industrial Development Revenue Bond
Apollo America Corporation, Series 91, AMT
LOC: Chemical Bank...................................................... 09/07/96 1,800,000
4,400,000 City of Westfield, 3.80% (b)
Industrial Development Revenue Bond
PL Porter Project, Series 89, AMT
LOC: Bank of America.................................................... 09/07/96 4,400,000
------------
18,450,324
------------
IOWA--0.6%
2,000,000 Iowa Higher Education, AMBAC, 6.125%
Student Loan Revenue Bond, Series 91C................................... 12/01/96 2,010,239
------------
KENTUCKY--2.8%
9,000,000 City of Louisville, 3.60% (b)
Airport Revenue Bond
Louisville Airport, Series 89B, AMT
LOC: National City Bank of Louisville................................... 09/07/96 9,000,000
------------
MISSISSIPPI--0.9%
2,950,000 City of Olive Branch, 3.75% (b)
United Healthcare, Series 86, AMT
LOC: First Union Bank of North Carolina................................. 09/07/96 2,950,000
------------
MISSOURI--0.6%
2,000,000 City of St. Joseph, 3.65% (b)
Industrial Development Revenue Bond
Altec Industries, Inc., Series 89, AMT
LOC: Wachovia Bank & Trust.............................................. 09/07/96 2,000,000
------------
MONTANA--1.1%
3,500,000 Montana Higher Education, 4.30%
Student Loan Revenue Bond, Series 93B, AMT.............................. 12/01/96 3,505,884
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
4
<PAGE> 5
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HERITAGE CASH TRUST -- MUNICIPAL MONEY MARKET FUND
STATEMENT OF NET ASSETS
AUGUST 31, 1996
(CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL MATURITY/PUT
AMOUNT DATE* VALUE
- ------------- ------------- ------------
<C> <S> <C> <C>
NEW HAMPSHIRE--5.6%
$ 9,000,000 New Hampshire Business Finance Authority, 3.60% (b)
Pollution Control Revenue Bond
Public Service of New Hampshire, Series 92D, AMT
LOC: Barclays Bank...................................................... 09/07/96 $ 9,000,000
2,695,000 New Hampshire Housing Finance Authority, 3.65% (b)
Multi Family Housing Revenue Bond
Countryside Ltd. Project, Series 94, AMT
LOC: General Electric Credit Corporation................................ 09/07/96 2,695,000
3,000,000 New Hampshire, GO, 5.0%
Capital Improvement, Series 95A......................................... 10/01/96 3,003,708
1,900,000 New Hampshire Housing Finance Authority, 3.60% (b)
Multi Family Housing Revenue Bond
Fairways Project
LOC: General Electric Credit Corporation................................ 09/07/96 1,900,000
1,600,000 New Hampshire Industrial Development Authority, 3.55% (b)
Pollution Control Revenue Bond
Connecticut Light & Power, Series 88, AMT
LOC: Union Bank of Switzerland.......................................... 09/07/96 1,600,000
------------
18,198,708
------------
NEW MEXICO--0.6%
1,000,000 Albuquerque Airport Facility, 3.45% (b)
Airport Revenue Bond
Albuquerque International, Series 96A
LOC: Bayerische Landesbank.............................................. 09/07/96 1,000,000
1,000,000 Santa Fe Mortgage Revenue, 4.0%
Single Family Mortgage Revenue Bond
Home Mortgage Revenue, FNMA & GNMA Series 95B, AMT
GIC: Financial Guaranty Insurance Company............................... 11/15/96 1,000,000
------------
2,000,000
------------
OHIO--1.5%
5,000,000 Ohio Air Authority, 3.50% (b)
Pollution Control Revenue Bond
JMG Funding Partnership, Series 94B, AMT
LOC: Societe Generale................................................... 09/07/96 5,000,000
------------
OKLAHOMA--3.7%
2,000,000 Oklahoma Development Finance Authority, 3.65% (b)
Shawnee Funding Project, Series 96, AMT
LOC: Bank of Nova Scotia................................................ 09/07/96 2,000,000
2,500,000 Oklahoma Industrial Development Authority, 3.80% (b)
Industrial Development Revenue Bond
Farley Candy Project, Series 94
LOC: Toronto Dominion................................................... 09/07/96 2,500,000
7,500,000 Optima Municipal Authority, 3.65% (b)
Industrial Development Revenue Bond
Seaboard Project, Series 94, AMT
LOC: Trust Company Bank................................................. 09/07/96 7,500,000
------------
12,000,000
------------
OREGON--2.6%
8,500,000 Port of Portland, 3.60% (b)
Industrial Development Revenue Bond
Portland Bulk Term, Series 96
LOC: Canadian Imperial Bank of Commerce................................. 09/07/96 8,500,000
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
5
<PAGE> 6
- --------------------------------------------------------------------------------
HERITAGE CASH TRUST -- MUNICIPAL MONEY MARKET FUND
STATEMENT OF NET ASSETS
AUGUST 31, 1996
(CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL MATURITY/PUT
AMOUNT DATE* VALUE
- ------------- ------------- ------------
<C> <S> <C> <C>
PENNSYLVANIA--2.3%
$ 3,700,000 Pennsylvania Higher Education, 3.55% (b)
Student Loan Revenue Bond, Series 88C, AMT
LOC: Student Loan Marketing Association................................. 09/07/96 $ 3,700,000
3,900,000 Pennsylvania Higher Education, 3.55% (b)
Student Loan Revenue Bond, Series 94A, AMT
LOC: Student Loan Marketing Association................................. 09/07/96 3,900,000
------------
7,600,000
------------
RHODE ISLAND--5.2%
2,600,000 City of Providence, 3.55% (b)
Washington Street Public Parking Garage, Series 91, AMT
LOC: Morgan Guaranty Trust Company...................................... 09/07/96 2,600,000
5,000,000 Rhode Island Port Authority, 3.50% (b)
Electric Revenue Bond
Newport Electric Corporation, Series 94
LOC: Canadian Imperial Bank of Commerce................................. 09/07/96 5,000,000
9,300,000 Rhode Island Higher Education, 3.50% (b)
Student Loan Revenue Bond, Series 95-1, AMT
LOC: National Westminister.............................................. 09/07/96 9,300,000
------------
16,900,000
------------
SOUTH CAROLINA--1.8%
2,000,000 Dorchester County, 3.55% (b)
Pollution Control Revenue Bond
The BOC Group, Series 93
LOC: Wachovia Bank & Trust.............................................. 09/07/96 2,000,000
2,300,000 South Carolina Economic Development Authority, 3.60% (b)
Industrial Development Revenue Bond
Synthetics International, Series 95, AMT
LOC: Wachovia Bank & Trust.............................................. 09/07/96 2,300,000
1,500,000 South Carolina Economic Development Authority, 3.60% (b)
Industrial Development Revenue Bond
Sanders Brothers, Series 96, AMT
LOC: Wachovia Bank & Trust.............................................. 09/07/96 1,500,000
------------
5,800,000
------------
SOUTH DAKOTA--1.1%
3,500,000 South Dakota Housing Development Authority, 4.05%
Single Family Mortgage Revenue Bond
Homeownership Mortgage, Series 95E, AMT................................. 10/24/96 3,500,000
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
6
<PAGE> 7
- --------------------------------------------------------------------------------
HERITAGE CASH TRUST -- MUNICIPAL MONEY MARKET FUND
STATEMENT OF NET ASSETS
AUGUST 31, 1996
(CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL MATURITY/PUT
AMOUNT DATE* VALUE
- ------------- -------------- ------------
<C> <S> <C> <C>
TEXAS--17.3%
$ 7,100,000 Brazos Higher Education, 3.45% (b)
Student Loan Revenue Bond, Series B1, AMT
LOC: Student Loan Marketing Association................................. 09/07/96 $ 7,100,000
8,500,000 Lago Vista Health Facility, 3.45% (b)
The Island on Lake Travis, Series 86, AMT
LOC: Credit Suisse...................................................... 09/07/96 8,500,000
5,000,000 Galveston, 3.60% (b)
Industrial Development Revenue Bond
Mitchell Project, Series 93, AMT
LOC: National Westminister.............................................. 09/07/96 5,000,000
7,900,000 Galveston, 3.60% (b)
Industrial Development Revenue Bond
Mitchell Project, Series 93A, AMT
LOC: National Westminister.............................................. 09/07/96 7,900,000
11,000,000 Port of Port Arthur, 3.55% (b)
Industrial Development Revenue Bond
Star Enterprises Project, Series 94, AMT
LOC: Swiss Bank......................................................... 09/07/96 11,000,000
6,200,000 San Antonio Housing Finance Authority, 3.50% (b)
Multi Family Housing Revenue Bond
Cape Cod Apartments, Series 90, AMT
LOC: Landesbank Hessen-Thueringen G. Z. ................................ 09/07/96 6,200,000
2,700,000 San Antonio Housing Finance Authority, 3.50% (b)
Multi Family Housing Revenue Bond
Mesa Ridge Apartments, Series 90, AMT
LOC: Landesbank Hessen-Thueringen G. Z.................................. 09/07/96 2,700,000
7,800,000 South Texas Higher Education, 3.45% (b)
Student Loan Revenue Bond, Series 95A, AMT
LOC: Student Loan Marketing Association................................. 09/07/96 7,800,000
------------
56,200,000
------------
UTAH--5.2%
2,000,000 Morgan County, 3.60% (b)
Solid Waste Revenue Bond
Holnam Inc., Series 96, AMT
LOC: Societe Generale................................................... 09/07/96 2,000,000
9,095,000 Utah Housing Finance Agency, 3.70% (b)
Single Family Mortgage Revenue Bond
Home Mortgage Revenue, Series 4
GIC: Trinity Funding.................................................... 09/07/96 9,095,000
6,000,000 Utah Housing Finance Authority, 3.70% (b)
Single Family Mortgage Revenue Bond
Home Ownership Mortgage, Series 96-3, AMT
GIC: Bayerische Landesbank.............................................. 09/07/96 6,000,000
------------
17,095,000
------------
VIRGINIA--8.0%
2,000,000 Alexandria Redevelopment and Housing Authority, 3.80% (b)
Multi Family Housing Revenue Bond
Buckingham Village Apartments, Series 96B, AMT
LOC: First Union Bank of North Carolina................................. 09/07/96 2,000,000
1,500,000 Charles City, 3.80% (b)
Solid Waste Revenue Bond,
Chambers Development of Virginia, Series 96 AMT
LOC: Morgan Guaranty Trust Company...................................... 09/07/96 1,500,000
</TABLE>
The accompanying notes are an integral part of the financial statements.
7
<PAGE> 8
- --------------------------------------------------------------------------------
HERITAGE CASH TRUST -- MUNICIPAL MONEY MARKET FUND
STATEMENT OF NET ASSETS
AUGUST 31, 1996
(CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL MATURITY/PUT
AMOUNT DATE* VALUE
- ------------- ------------- ------------
<C> <S> <C> <C>
$ 4,505,000 Fairfax County Development Authority, 3.80% (b)
Fair Lakes D&K Ltd. Partnership, Series 96, AMT
LOC: First Union Bank of North Carolina................................. 09/07/96 $ 4,505,000
7,500,000 Richmond Redevelopment and Housing Authority, 3.70% (b)
Multi Family Housing Revenue Bond
Tobacco Row, Series 89B-5, AMT
GIC: Westdeutsche Landesbank............................................ 09/07/96 7,500,000
10,660,000 Richmond Redevelopment and Housing Authority, 3.70% (b)
Multi Family Housing Revenue Bond
Tobacco Row, Series 89B-7, AMT
GIC: Westdeutsche Landesbank............................................ 09/07/96 10,660,000
------------
26,165,000
------------
WASHINGTON--0.4%
1,300,000 Bremerton, FGIC, 4.8%
Sewer System Revenue Bond, Series 92A................................... 09/01/97 1,309,370
------------
WEST VIRGINIA--3.8%
3,900,000 Marion County, 3.60% (b)
Solid Waste Revenue Bond
Grant Town Cogen Project, Series 92A, AMT
LOC: National Westminister.............................................. 09/07/96 3,900,000
4,300,000 Marion County, 3.55% (b)
Solid Waste Revenue Bond
Grant Town Cogen Project, Series 91B, AMT
LOC: National Westminister.............................................. 09/07/96 4,300,000
4,400,000 Marion County, 3.55% (b)
Solid Waste Revenue Bond
Grant Town Cogen Project, Series 90D, AMT
LOC: National Westminister.............................................. 09/07/96 4,400,000
------------
12,600,000
------------
TOTAL INVESTMENTS (cost $324,896,532)(c), 99.7% (a).................................................... 324,896,532
OTHER ASSETS AND LIABILITIES, net, 0.3% (a)............................................................ 864,940
------------
NET ASSETS (net asset value, offering and redemption price of $1.00 per share; 325,827,848 shares
outstanding), consisting of paid-in-capital net of accumulated net realized loss of $66,375,
100.00%.............................................................................................. $325,761,472
============
</TABLE>
- ---------------
* Earlier of the maturity date or the put date.
(a) Percentages are based on net assets.
(b) Floating Rate notes are securities that generally are payable on demand
within seven calendar days. Put bonds are securities that can be put back to
the issuer or remarketer either at the option of the holder, at a specified
date, or within a specified time period known at the time of purchase. For
these securities, the demand period and the remaining period to put date,
respectively, are used when calculating the weighted average maturity of the
portfolio.
(c) The aggregate identified cost for federal income tax purposes is the same.
AMBAC--American Municipal Bond Assurance Corporation
AMT--Securities subject to Alternative Minimum Tax
BPA--Bond purchase agreement provided by noted institution
FGIC--Federal Guaranty Insurance Company
GIC--Credit enhancement provided by guaranteed investment contract with noted
institution
GO--General Obligation
LOC--Credit enhancement provided by letter of credit issued by noted institution
MBIA--Municipal Bond Investors Assurance
The accompanying notes are an integral part of the financial statements.
8
<PAGE> 9
- --------------------------------------------------------------------------------
HERITAGE CASH TRUST -- MUNICIPAL MONEY MARKET FUND
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED AUGUST 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
Investment Income
Interest................................................................................. $11,514,663
Expenses (Notes 1 and 4):
Management fee......................................................................... $1,538,074
Distribution fee....................................................................... 465,971
Shareholder servicing.................................................................. 111,384
Amortization of state registration expenses............................................ 99,432
Custodian/Fund accounting fees......................................................... 71,506
Professional fees...................................................................... 42,729
Reports to shareholders................................................................ 17,484
Federal registration fees.............................................................. 14,742
Amortization of organization expenses.................................................. 9,252
Trustees' fees and expenses............................................................ 8,394
Insurance.............................................................................. 3,734
Other.................................................................................. 8,477
----------
Total expenses........................................................................... 2,391,179
-----------
Net investment income resulting from operations.......................................... $ 9,123,484
==========
</TABLE>
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FOR THE YEARS ENDED
-----------------------------------
AUGUST 31, 1996 AUGUST 31, 1995
--------------- ---------------
<S> <C> <C>
Increase (decrease) in net assets:
Operations:
Net investment income.......................................................... $ 9,123,484 $ 7,478,963
Net realized loss from investment transactions................................. -- (46,523)
--------------- ---------------
Net increase in net assets resulting from operations............................. 9,123,484 7,432,440
Distributions to shareholders from net investment income ($.030 and $.030 per
share, respectively)........................................................... (9,123,484) (7,478,963)
Increase in net assets from Fund share transactions (Note 2)..................... 42,751,733 70,589,200
--------------- ---------------
Increase in net assets........................................................... 42,751,733 70,542,677
Net assets, beginning of year.................................................... 283,009,739 212,467,062
--------------- ---------------
Net assets, end of year.......................................................... $ 325,761,472 $ 283,009,739
============== ==============
</TABLE>
The accompanying notes are an integral part of the financial statements.
9
<PAGE> 10
- --------------------------------------------------------------------------------
HERITAGE CASH TRUST -- MUNICIPAL MONEY MARKET FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
The following table includes selected data for a share outstanding throughout
each period and other performance information derived from the financial
statements.
<TABLE>
<CAPTION>
FOR THE YEARS ENDED AUGUST 31,
--------------------------------------------------
1996 1995 1994 1993 1992+
------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD:................. $1.000 $1.000 $1.000 $1.000 $1.000
------ ------ ------ ------ ------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income(a)............................ .030 .030 .019 .020 .005
LESS DISTRIBUTIONS:
Dividends from net investment income................ (.030) (.030) (.019) (.020) (.005)
------ ------ ------ ------ ------
NET ASSET VALUE, END OF PERIOD:....................... $1.000 $1.000 $1.000 $1.000 $1.000
====== ====== ====== ====== ======
TOTAL RETURN %........................................ 2.98 3.04 1.90 2.02 .47(c)
RATIOS TO AVERAGE DAILY NET ASSETS(%)/SUPPLEMENTAL
DATA:
Operating expenses, net(a).......................... .77 .77 .77 .77 .77(b)
Net investment income............................... 2.94 3.05 1.89 1.98 2.32(b)
Net assets, end of period ($ millions).............. 326 283 212 207 102
</TABLE>
- ---------------
+ For the period June 17, 1992 (commencement of operations) to August 31,
1992.
(a) Excludes management fees waived by the Manager in the amount of less than
$.001, $.001, $.001 and $.001, per share, for the four periods ended August
31, 1995, respectively. The operating expense ratios including such items
would be .79%, .77%, .83% and 1.11% (annualized), respectively. No
management fees were waived or recovered for the year ended August 31,
1996.
(b) Annualized.
(c) Not annualized.
The accompanying notes are an integral part of the financial statements.
10
<PAGE> 11
- --------------------------------------------------------------------------------
HERITAGE CASH TRUST -- MUNICIPAL MONEY MARKET FUND
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
Note 1: SIGNIFICANT ACCOUNTING POLICIES. Heritage Cash Trust (the "Trust") is
organized as a Massachusetts business trust and is registered under the
Investment Company Act of 1940, as amended, as a no-load, diversified,
open-end management investment company consisting of two separate
investment portfolios, the Municipal Money Market Fund (the "Fund") and
the Money Market Fund. The Fund is designed for investors who wish to
participate in a portfolio of federally tax-exempt debt securities with
remaining maturities of not more than 397 days. The preparation of
financial statements in accordance with generally accepted accounting
principles requires management to make estimates and assumptions that
affect the reported amounts and disclosures. Actual results could differ
from those estimates. The following is a summary of significant
accounting policies:
Security Valuation: The Fund uses the amortized cost method of security
valuation (as set forth in Rule 2a-7 under the Investment Company Act of
1940, as amended). The amortized cost of an instrument is determined by
valuing it at cost at the time of purchase and thereafter
accreting/amortizing any purchase discount/premium at a constant rate
until maturity, regardless of the effect of fluctuating interest rates
on the market value of the instrument.
Federal Income Taxes: The Fund is treated as a single corporate taxpayer
as provided for in the Tax Reform Act of 1986, as amended. The Fund's
policy is to comply with the requirements of the Internal Revenue Code
of 1986, as amended, which are applicable to regulated investment
companies and to distribute substantially all of its taxable income to
its shareholders. Accordingly, no provision has been made for federal
income and excise taxes.
Distribution of Income and Gains: Distributions from net investment
income and net realized gains available for distribution are declared
daily and paid monthly. The Fund uses the identified cost method for
determining realized gain or loss on investment transactions for both
financial and federal income tax reporting purposes.
State Registration Expenses: State registration fees are amortized based
either on the time period covered by the registration or as related
shares are sold, whichever is appropriate for each state.
Organization Expenses: Expenses incurred in connection with the
formation of the Fund were deferred and are being amortized on a
straight-line basis over 60 months from the date of commencement of
operations.
Other: Investment transactions are recorded on a trade date basis which
is generally the same as settlement date. Interest income is recorded on
the accrual basis.
Note 2: FUND SHARES. At August 31, 1996 there was an unlimited number of shares
of beneficial interest of no par value authorized. Transactions in
shares and dollars of the Fund during the years ended August 31, 1996
and 1995, at a constant net asset value of $1.00 per share, were as
follows:
<TABLE>
<CAPTION>
FOR THE YEARS ENDED
-----------------------------------
AUGUST 31, 1996 AUGUST 31, 1995
--------------- ---------------
<S> <C> <C>
Shares sold............................................................ 1,388,242,449 1,085,052,629
Shares issued on reinvestment of distributions......................... 8,254,216 7,350,654
Shares redeemed........................................................ (1,353,744,932 ) (1,021,814,083 )
--------------- ---------------
Net increase......................................................... 42,751,733 70,589,200
Shares outstanding:
Beginning of year.................................................... 283,076,115 212,486,915
--------------- ---------------
End of year.......................................................... 325,827,848 283,076,115
============== ==============
</TABLE>
Note 3: PURCHASES, SALES AND MATURITIES OF SECURITIES. For the year ended
August 31, 1996, purchases, sales and maturities of short-term
investment securities aggregated $678,425,225, $577,405,000 and
$55,770,000, respectively.
Note 4: MANAGEMENT, SUBADVISORY, DISTRIBUTION, SHAREHOLDER SERVICING AGENT AND
TRUSTEES' FEES. Under the Fund's Investment Advisory and Administration
Agreement with Heritage Asset Management, Inc. (the "Manager"), the Fund
agrees to pay to the Manager for investment advice, portfolio management
services (including the placement of brokerage orders), and certain
compliance and administrative services a fee equal to an annual rate of
0.50% of the first $500,000,000 of the Fund's average daily net assets,
0.475% of the next $500,000,000, 0.45% of the next $500,000,000, 0.425%
of the next $500,000,000, and 0.40% of any excess over $2,000,000,000 of
such net assets, computed daily and payable monthly. Effective January
2, 1996, the Manager agreed to the following management fee schedule:
.50% of the first $250,000,000, .475% of the next $250,000,000, .45% of
the next $250,000,000, .425% of the next $250,000,000 and .40% on assets
over $1 billion of such net assets. The amount payable to the Manager as
of August 31, 1996 was $137,235. The agreement also provides for a
reduction in such fees in any year to the extent that operating expenses
of the Fund exceed applicable state expense limitations. Since
inception, the Manager has
11
<PAGE> 12
- --------------------------------------------------------------------------------
HERITAGE CASH TRUST -- MUNICIPAL MONEY MARKET FUND
NOTES TO FINANCIAL STATEMENTS
(CONTINUED)
- --------------------------------------------------------------------------------
voluntarily agreed to waive its fee and, if necessary, reimburse the
Fund to the extent that Fund operating expenses exceed .77%, on an
annual basis, of the Fund's average daily net assets. This limitation is
more restrictive than any state expense limitation. Under this voluntary
limitation, management fees of $40,432 ($.00002 per share) were waived
in the year ended August 31, 1995. If total Fund expenses fall below the
expense limitation agreed to by the Manager before the end of the year
ending August 31, 1997, the Fund may be required to pay the Manager a
portion or all of the waived management fee.
The Manager has entered into an agreement with Alliance Capital
Management L.P. (the "Subadviser") to provide investment advice and
portfolio management services, including placement of brokerage orders,
to the Fund for a fee payable by the Manager equal to an annual rate of
.125% of average daily net assets on assets up to $100 million, .10% of
average daily net assets on assets from $100 million to $250 million,
and .05% on average daily net assets exceeding $250 million.
The Manager is also the Dividend Paying and Shareholder Servicing Agent
for the Fund. The amount payable to the Manager for such expenses as of
August 31, 1996 was $21,000. In addition, the Manager performs Fund
accounting services for the Fund and charged $40,168 during the year of
which $6,600 was payable as of August 31, 1996.
Pursuant to a plan adopted in accordance with Rule 12b-1 of the
InvestmentCompany Act of 1940, as amended, the Fund pays Raymond James
& Associates, Inc. (the "Distributor") a fee equal to 0.15% of average
daily net assets for the services it provides in connection with the
promotion and distribution of Fund shares. Such fee is accrued daily and
payable monthly. The amount payable to the Distributor as of August 31,
1996 was $41,501. The Manager, Distributor, Fund Accountant and
Shareholder Servicing Agent are all wholly-owned subsidiaries of Raymond
James Financial, Inc.
Trustees of the Trust also serve as Trustees for Heritage Capital
Appreciation Trust, Heritage Income-Growth Trust, Heritage Income Trust,
Heritage Series Trust and Heritage U.S. Government Income Fund,
investment companies that are also advised by the Manager or its
affiliates (collectively referred to as the Heritage Mutual Funds). Each
Trustee of the Heritage Mutual Funds who is not an interested person of
the Manager receives an annual fee of $8,000 and an additional fee of
$2,000 for each combined quarterly meeting of the Heritage Mutual Funds
attended. Trustees' fees and expenses are shared equally by each of the
Heritage Mutual Funds.
Note 5: FEDERAL INCOME TAXES. As of August 31, 1996, the Fund has net tax basis
capital loss carryforwards of $17,824, $2,029 and $46,522 which may be
applied against any realized net taxable gains until their expiration
dates in 2001, 2003 and 2004, respectively.
12
<PAGE> 13
- --------------------------------------------------------------------------------
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
- --------------------------------------------------------------------------------
To the Shareholders and Board of Trustees of
Heritage Cash Trust-Municipal Money Market Fund
In our opinion, the accompanying statement of net assets and the related
statements of operations and of changes in net assets and the financial
highlights present fairly, in all material respects, the financial position of
Heritage Cash Trust-Municipal Money Market Fund (the "Fund") at August 31, 1996,
and the results of its operations, the changes in its net assets and the
financial highlights for the year then ended, in conformity with generally
accepted accounting principles. These financial statements and financial
highlights (hereafter referred to as "financial statements") are the
responsibility of the Fund's management; our responsibility is to express an
opinion on these financial statements based on our audit. We conducted our audit
of these financial statements in accordance with generally accepted auditing
standards which require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audit, which included confirmation of securities at August 31, 1996 by
correspondence with the custodian, provides a reasonable basis for the opinion
expressed above. The financial statements of the Fund for the year ended August
31, 1995, including the financial highlights for each of the periods indicated,
were audited by other independent accountants whose report dated October 12,
1995 expressed an unqualified opinion on those statements.
/s/ Price Waterhouse LLP
- ------------------------
PRICE WATERHOUSE LLP
Tampa, Florida
October 11, 1996
13
<PAGE> 14
- --------------------------------------------------------------------------------
TAX INFORMATION
(UNAUDITED)
- --------------------------------------------------------------------------------
Of the dividends paid from net investment income for the year ended August
31, 1996, 100% were exempt interest dividends which are tax exempt for purposes
of regular federal income tax, and a portion were exempt interest dividends
which may be subject to the federal alternative minimum tax. Please consult a
tax adviser if you have questions about federal or state income tax laws, or on
how to prepare your tax return.
14
<PAGE> 15
HERITAGE CASH TRUST-MUNICIPAL MONEY MARKET FUND is a member of the Heritage
family of mutual funds. Other investment alternatives available to you from
Heritage include:
---HERITAGE CASH TRUST
MONEY MARKET FUND
---HERITAGE CAPITAL APPRECIATION TRUST
---HERITAGE INCOME-GROWTH TRUST
---HERITAGE INCOME TRUST
HIGH YIELD BOND FUND
INTERMEDIATE GOVERNMENT FUND
---HERITAGE SERIES TRUST
EAGLE INTERNATIONAL EQUITY PORTFOLIO
GROWTH EQUITY FUND
SMALL CAP STOCK FUND
VALUE EQUITY FUND
---HERITAGE U.S. GOVERNMENT INCOME FUND
(A CLOSED-END FUND THAT TRADES ON THE
NEW YORK STOCK EXCHANGE)
We are pleased that many of you are also investors in these funds. For
information and a prospectus for any of these mutual funds, please contact your
account executive. Please read the Prospectus carefully before you invest in any
of the funds.
<PAGE> 16
Heritage Cash Trust-Municipal Money Market Fund
P.O. Box 33022
St. Petersburg, FL 33733
--------------------------------------------
Address Change Requested
This report is for the information of shareholders of
Heritage Cash Trust-Municipal Money Market Fund, It may also be used as
sales literature when preceded or accompanied by a prospectus.
11M 10/96 (RECYCLE LOGO) Printed on recycled paper
(LOGO) HERITAGE CASH TRUST (TM)
MUNICIPAL MONEY MARKET FUND
A money market fund seeking
maximum current income exempt
from Federal income tax consistent
with stability of principal
ANNUAL REPORT
and Investment Performance
Review for the Year Ended
AUGUST 31, 1996
A member of the
Heritage Family of Mutual Funds(TM)
