<PAGE> 1
MUNICIPAL
MONEY MARKET [BAR LOGO]
FUND
[Pictures of People Working & Playing]
From Our Family to Yours: The Intelligent Creation of Wealth.
ANNUAL REPORT
and Investment Performance
Review for the Year Ended
August 31, 1997
[HERITAGE LOGO]
<PAGE> 2
October 13, 1997
Dear Fellow Shareholders:
I am pleased to provide you with the annual report for Heritage Cash
Trust - Municipal Money Market Fund (the "Fund") for the fiscal year ended
August 31, 1997. During the past fiscal year, rates on short-term investments
fluctuated within a relatively narrow range. The seven-day effective yield for
your Fund began the fiscal year at 2.93%, fell to 2.77% at the end of February,
and stood at 2.72% on August 31. As of the date of this letter, the seven-day
effective yield was 3.02%.
The primary reason for the stability of short-term rates has been the lack
of any drastic action by the Federal Reserve Board (the "Fed") to slow down or
speed up the economy. As our domestic economy has continued to grow at a slow,
steady rate with minimal inflationary pressures, the Fed has been content to
leave rates relatively unchanged. We continue to believe that the Fed will act
quickly to raise rates at the first evidence of increasing inflation, and have
structured your portfolio to allow us room to lengthen your portfolio maturity
to take advantage of this situation, should it occur.
We are still awaiting the final effective date for new Securities and
Exchange Commission ("SEC") rules governing money market fund operations. As we
have reported previously, we do not expect these rules to cause any significant
changes in how your Fund is managed.
Your Fund continues to maintain a AAAm rating from 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 SEC.
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.
Please remember that if you are subject to the alternative minimum tax, a
portion of your Fund's income may be considered a preference item for tax
purposes. Also, if you are subject to a state income tax, a portion of the
income your Fund earns from securities issued in your state may be exempt from
your state income tax.
On behalf of all of us at Heritage Asset Management, thank you for your
continuing investment in Heritage Cash Trust - Municipal Money Market Fund.
Sincerely,
/s/ Stepehn G. Hill
Stephen G. Hill
President
<PAGE> 3
HERITAGE CASH TRUST -- MUNICIPAL MONEY MARKET FUND
STATEMENT OF NET ASSETS
AUGUST 31, 1997
<TABLE>
<CAPTION>
PRINCIPAL MATURITY/PUT
AMOUNT DATE* VALUE
--------- ------------ ------------
<C> <S> <C> <C>
NOTES, BONDS & VARIABLE RATE DEMAND NOTES -- 102.8%(A)
ALASKA--2.6%
$ 3,000,000 Alaska Industrial Development Authority, 3.40% (b)
Revolving Fund, Series 96B, AMT
LOC: Bank of America...................................... 09/07/97 $ 3,000,000
5,000,000 Alaska Industrial Development Authority, 3.45% (b)
Fairbanks Gold Mining Inc., Series 97, AMT
LOC: Union Bank of Switzerland............................ 09/07/97 5,000,000
3,000,000 City of Anchorage, 3.35% (b)
Electric Utility Revenue Bond, Series 96D
LOC: Bank of America...................................... 09/07/97 3,000,000
------------
11,000,000
------------
ARKANSAS--1.3%
5,600,000 City of Jacksonville, 3.85% (b)
Industrial Development Revenue Bond
Regalware, Inc.
LOC: NBD Corporation...................................... 09/30/97 5,600,000
------------
COLORADO--6.9%
1,200,000 Colorado Student Obligation Authority, 3.35% (b)
Student Loan Revenue Bond, Series 93B, AMT
LOC: Student Loan Marketing Association................... 09/07/97 1,200,000
4,900,000 Colorado Student Obligation Authority, 3.35% (b)
Student Loan Revenue Bond, Series 90A, AMT
LOC: Student Loan Marketing Association................... 09/07/97 4,900,000
9,500,000 Colorado Student Obligation Authority, 3.35% (b)
Student Loan Revenue Bond, Series 89A, AMT
LOC: Student Loan Marketing Association................... 09/07/97 9,500,000
9,000,000 Denver Airport Revenue Bond, 3.40% (b)
Airport System Revenue, Series 91C
LOC: Credit Local De France............................... 09/07/97 9,000,000
2,400,000 Denver Airport Revenue Bond, 3.40% (b)
Airport System Revenue, Series 97B
GIC: Westdeutsche Landesbank.............................. 09/07/97 2,400,000
1,700,000 El Paso County, 3.50% (b)
Multi Family Housing Revenue Bond
Briar Glen Apartments, Series 95
LOC: General Electric Credit Corporation.................. 09/07/97 1,700,000
------------
28,700,000
------------
DISTRICT OF COLUMBIA--2.0%
3,500,000 District of Columbia Housing Finance Authority, 4.05%
Single Family Mortgage Revenue Bond
Home Mortgage Revenue, Series 97C, AMT
GIC: American International Group......................... 09/07/98 3,500,000
</TABLE>
The accompanying notes are an integral part of the financial statements.
2
<PAGE> 4
HERITAGE CASH TRUST -- MUNICIPAL MONEY MARKET FUND
STATEMENT OF NET ASSETS
AUGUST 31, 1997
(CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL MATURITY/PUT
AMOUNT DATE* VALUE
--------- ------------ ------------
<C> <S> <C> <C>
$ 5,000,000 District of Columbia, GO, 4.50%
Tax Revenue Anticipation Note, Series 97A
LOC: National Westminister
Societe Generale..................................... 09/30/97 $ 5,002,030
------------
8,502,030
------------
FLORIDA--0.7%
3,000,000 Dade County, 4.00%
Single Family Mortgage Revenue Bond
Home Mortgage Revenue, Series 96, AMT
GIC: Financial Guaranty Insurance Company................. 10/01/97 3,000,000
------------
ILLINOIS--15.5%
3,800,000 City of Chicago, 3.30% (b)
Airport Revenue Bond
O'Hare International Airport, Series 84B
LOC: Societe Generale..................................... 09/07/97 3,800,000
2,000,000 City of Chicago, 3.30% (b)
Airport Revenue Bond
O'Hare International Airport, Series 84A
LOC: Societe Generale..................................... 09/07/97 2,000,000
14,000,000 Illinois Development Finance Authority, 3.35% (b)
Illinois Power Company Project, Series 93A
LOC: Canadian Imperial.................................... 09/07/97 14,000,000
3,500,000 Illinois Development Finance Authority, 3.35% (b)
Chicago Symphony Special Project, Series 96
LOC: Bank of America...................................... 09/07/97 3,500,000
19,700,000 Illinois Toll Highway Authority, 3.25% (b)
Series 93B
LOC: Societe Generale..................................... 09/07/97 19,700,000
7,000,000 Jackson-Union County, 3.35% (b)
Enron Transportation Services
LOC: First Union Bank of North Carolina................... 09/07/97 7,000,000
12,630,000 Madison County, 3.40% (b)
Solid Waste Revenue Bond
Shell Oil/Wood River Project, Series 97, AMT.............. 09/07/97 12,630,000
2,400,000 Southwestern Illinois Development Authority, 3.50% (b)
Industrial Development Revenue Bond
Robinson Steel Company, Series 91, AMT
LOC: American National Bank of Chicago.................... 09/07/97 2,400,000
------------
65,030,000
------------
INDIANA--6.7%
2,240,000 City of Crawfordsville, 3.50% (b)
Industrial Development Revenue Bond
Precision Plastics of Indiana, Series 92
LOC: Northern Trust Company............................... 09/07/97 2,240,000
</TABLE>
The accompanying notes are an integral part of the financial statements.
3
<PAGE> 5
HERITAGE CASH TRUST -- MUNICIPAL MONEY MARKET FUND
STATEMENT OF NET ASSETS
AUGUST 31, 1997
(CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL MATURITY/PUT
AMOUNT DATE* VALUE
--------- ------------ ------------
<C> <S> <C> <C>
$ 2,000,000 City of Indianapolis, 3.55% (b)
Industrial Development Revenue Bond
Altec Industries Inc., Project, Series 89, AMT
LOC: Wachovia Bank and Trust.............................. 09/07/97 $ 2,000,000
8,000,000 City of Jeffersonville, 3.45% (b)
Industrial Development Revenue Bond
Apollo America Corporation, Series 91, AMT
LOC: Chase Manhattan Bank................................. 09/07/97 8,000,000
4,780,000 City of North Vernon, 3.65% (b)
Multi Family Housing Revenue Bond
Oak Meadows Apartments Project, Series 95, AMT
LOC: Federal Home Loan Bank............................... 09/07/97 4,780,000
4,200,000 City of Westfield, 3.40% (b)
Industrial Development Revenue Bond
PL Porter Project, Series 89, AMT
LOC: Bank of America...................................... 09/07/97 4,200,000
6,770,000 Hamilton County Hospital Authority, 3.30% (b)
Hospital Revenue Bond
St. Vincent's Hospital Care Center, Daughters of
Charity................................................... 09/07/97 6,770,000
------------
27,990,000
------------
LOUISIANA--3.6%
3,770,000 Calcasieu Parish, 3.35% (b)
Sales Tax District No. 4-A, Series 94
LOC: National Westminster................................. 09/07/97 3,770,000
3,750,000 Calcasieu Parish, 3.35% (b)
Sales Tax District No. 4-A, Series 94
LOC: National Westminster................................. 09/07/97 3,750,000
6,700,000 Lincoln Parish, 3.45% (b)
Sewer Revenue Bond
Willamette Industrial Project, Series 96, AMT
LOC: Deutsche Bank........................................ 09/07/97 6,700,000
1,000,000 St. Charles Parish, 3.80% (b)
Shell Oil Company Project, Series 91, AMT................. 09/01/97 1,000,000
------------
15,220,000
------------
MARYLAND--1.4%
5,700,000 Montgomery County, 3.35% (b)
Multi Family Housing Revenue Bond
Falklands Apartments, Series 85B, AMT..................... 09/07/97 5,700,000
------------
MASSACHUSETTS--4.7%
19,600,000 Massachusetts Education Finance Authority, 3.30% (b)
Student Loan Revenue Bond, Series 97E, AMT
GIC: Trinity Funding...................................... 09/07/97 19,600,000
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
4
<PAGE> 6
HERITAGE CASH TRUST -- MUNICIPAL MONEY MARKET FUND
STATEMENT OF NET ASSETS
AUGUST 31, 1997
(CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL MATURITY/PUT
AMOUNT DATE* VALUE
--------- ------------ ------------
<C> <S> <C> <C>
MICHIGAN--1.2%
$ 5,000,000 Michigan Hospital Finance Authority, 3.30% (b)
St. Mary's Hospital
Daughters of Charity, Series 84........................... 09/07/97 $ 5,000,000
------------
MINNESOTA--1.0%
4,300,000 City of St. Paul, 3.65% (b)
Multi Family Housing Revenue Bond
Kendrick Apartments, Series 97, AMT
LOC: First Bank Systems................................... 09/07/97 4,300,000
------------
NEW HAMPSHIRE--4.4%
1,700,000 New Hampshire Business Finance Authority, 3.35% (b)
Pollution Control Revenue Bond
Connecticut Light & Power, Series 92
LOC: Canadian Imperial.................................... 09/07/97 1,700,000
9,000,000 New Hampshire Business Finance Authority, 3.45% (b)
Pollution Control Revenue Bond
Public Service of New Hampshire, Series 92D, AMT
LOC: Barclays Bank........................................ 09/07/97 9,000,000
3,600,000 New Hampshire Housing Finance Authority, 3.45% (b)
Multi Family Housing Revenue Bond
Fairways Project, AMT
LOC: General Electric Credit Corporation.................. 09/07/97 3,600,000
2,695,000 New Hampshire Housing Finance Authority, 3.35% (b)
Multi Family Housing Revenue Bond
Countryside LTD Project, Series 94, AMT
LOC: General Electric Credit Corporation.................. 09/07/97 2,695,000
1,600,000 New Hampshire Industrial Development Authority, 3.40% (b)
Pollution Control Revenue Bond
Connecticut Light & Power, Series 88, AMT
LOC: Union Bank of Switzerland............................ 09/07/97 1,600,000
------------
18,595,000
------------
NEW MEXICO--0.7%
1,100,000 City of Farmington, 3.80% (b)
Pollution Control Revenue Bond
Arizona Public Services, Series 94C, AMT
LOC: Union Bank of Switzerland............................ 09/07/97 1,100,000
2,000,000 New Mexico Housing Finance Authority, 3.95%
Single Family Mortgage Revenue Bond
Home Mortgage Revenue, Series 97D-2, AMT
GIC: Financial Guaranty Insurance Company................. 06/15/98 2,000,000
------------
3,100,000
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
5
<PAGE> 7
HERITAGE CASH TRUST -- MUNICIPAL MONEY MARKET FUND
STATEMENT OF NET ASSETS
AUGUST 31, 1997
(CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL MATURITY/PUT
AMOUNT DATE* VALUE
--------- ------------ ------------
<C> <S> <C> <C>
NORTH CAROLINA--1.4%
$ 2,300,000 Halifax County, 3.85% (b)
Pollution Control Revenue Bond
Louisville, Gas & Electric, Series 93, AMT
LOC: Credit Suisse........................................ 09/01/97 $ 2,300,000
3,600,000 Union County, 3.35% (b)
Industrial Development Revenue Bond
Square D Company Project, Series 88
LOC: Morgan Guarantee Trust Company....................... 09/07/97 3,600,000
------------
5,900,000
------------
NORTH DAKOTA--1.2%
5,000,000 North Dakota Housing Finance Authority, 4.00%
Single Family Mortgage Revenue Bond
Home Mortgage, Series 97C, AMT
GIC: Bayerische Landesbank................................ 08/04/98 5,000,000
------------
OHIO--3.1%
4,500,000 Ohio Air Quality Development Authority, 3.35% (b)
Pollution Control Revenue Bond
JMG Funding Partnership, Series 95B, AMT
LOC: Societe Generale..................................... 09/07/97 4,500,000
8,400,000 Ohio Air Quality Development Authority, 3.35% (b)
Pollution Control Revenue Bond
JMG Funding Partnership, Series 94A, AMT
LOC: Societe Generale..................................... 09/07/97 8,400,000
------------
12,900,000
------------
OKLAHOMA--2.3%
2,000,000 Oklahoma Development Finance Authority, 3.50% (b)
Shawnee Funding Project, Series 96, AMT
LOC: Bank of Nova Scotia.................................. 09/07/97 2,000,000
7,500,000 Optima Municipal Authority, 3.50% (b)
Industrial Development Revenue Bond
Seaboard Project, Series 94, AMT
LOC: Trust Company Bank................................... 09/07/97 7,500,000
------------
9,500,000
------------
OREGON--2.0%
8,500,000 Port of Portland, 3.45% (b)
Industrial Development Revenue Bond
Portland Bulk Terminal, Series 96, AMT
LOC: Canadian Imperial Bank of Commerce................... 09/07/97 8,500,000
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
6
<PAGE> 8
HERITAGE CASH TRUST -- MUNICIPAL MONEY MARKET FUND
STATEMENT OF NET ASSETS
AUGUST 31, 1997
(CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL MATURITY/PUT
AMOUNT DATE* VALUE
--------- ------------ ------------
<C> <S> <C> <C>
PENNSYLVANIA--4.9%
$ 4,600,000 City of Emmaus, GO, 3.35% (b)
Bond Pool Project, Series 89D-10
LOC: Canadian Imperial Bank of Commerce................... 09/07/97 $ 4,600,000
7,000,000 City of Emmaus, GO, 3.35% (b)
Bond Pool Project, Series 89D-12
LOC: Canadian Imperial Bank of Commerce................... 09/07/97 7,000,000
2,000,000 Delaware Valley Finance Authority, 3.25% (b)
Local Government Revenue Bond, Series 86
LOC: Credit Suisse........................................ 09/07/97 2,000,000
1,000,000 Delaware Valley Finance Authority, 3.25% (b)
Local Government Revenue Bond, Series 85C
LOC: Credit Suisse........................................ 09/07/97 1,000,000
1,050,000 Pennsylvania Energy Development Authority, 3.35% (b)
B&W Ebensburg Project, AMT
LOC: Swiss Bank........................................... 09/07/97 1,050,000
5,000,000 City of Philadelphia, GO, 4.50%
Tax Revenue Anticipation Note, Series 97A................. 06/30/98 5,019,884
------------
20,669,884
------------
RHODE ISLAND--3.2%
2,600,000 City of Providence, 3.40% (b)
Washington Street Public Parking Garage, Series 91, AMT
LOC: Morgan Guaranty Trust Company........................ 09/07/97 2,600,000
1,300,000 Rhode Island Higher Education, 3.40% (b)
Student Loan Revenue Bond, Series 96-3, AMT
LOC: National Westminster................................. 09/07/97 1,300,000
5,000,000 Rhode Island Higher Education, 3.40% (b)
Student Loan Revenue Bond, Series 96J-2, AMT
LOC: National Westminster................................. 09/07/97 5,000,000
4,400,000 Rhode Island Higher Education, 3.40% (b)
Student Loan Revenue Bond, Series 95-1, AMT
LOC: National Westminster................................. 09/07/97 4,400,000
------------
13,300,000
------------
SOUTH DAKOTA--2.8%
6,600,000 South Dakota Housing Development Authority, 3.60% (b)
Single Family Mortgage Revenue Bond
Home Mortgage Revenue, Series 97E
GIC: Westdeutsche Landesbank.............................. 09/07/97 6,600,000
5,000,000 South Dakota Housing Development Authority, 3.95%
Single Family Mortgage Revenue Bond
Home Mortgage Revenue, Series 97G, AMT.................... 08/13/98 5,000,000
------------
11,600,000
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
7
<PAGE> 9
HERITAGE CASH TRUST -- MUNICIPAL MONEY MARKET FUND
STATEMENT OF NET ASSETS
AUGUST 31, 1997
(CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL MATURITY/PUT
AMOUNT DATE* VALUE
--------- ------------ ------------
<C> <S> <C> <C>
TEXAS--13.4%
$ 6,500,000 Brazos Higher Education, 3.35% (b)
Student Loan Revenue Bond, Series B1, AMT
LOC: Student Loan Marketing Association................... 09/07/97 $ 6,500,000
3,700,000 City of Galveston, 3.45% (b)
Industrial Development Revenue Bond
Mitchell Project, Series 93A, AMT
LOC: National Westminster................................. 09/07/97 3,700,000
8,500,000 City of Lago Vista Health Facility Authority, 3.35% (b)
The Island on Lake Travis, Series 86, AMT
LOC: Credit Suisse........................................ 09/07/97 8,500,000
5,400,000 Harris County, 3.75% (b)
Exxon Project, Series 87, AMT............................. 09/01/97 5,400,000
1,565,000 North Texas Higher Education, 4.85%
Student Loan Revenue Bond, Series 93B, AMT................ 04/01/98 1,572,459
2,000,000 Panhandle Plains, Higher Education Authority Inc., 3.35% (b)
Student Loan Revenue Bond, Series 91B, AMT
LOC: Student Loan Marketing Association................... 09/07/97 2,000,000
1,000,000 Panhandle Plains, Higher Education Authority Inc., 3.35% (b)
Student Loan Revenue Bond, Series 92A
LOC: Student Loan Marketing Association................... 09/07/97 1,000,000
13,700,000 Panhandle Plains, Higher Education Authority Inc., 3.35% (b)
Student Loan Revenue Bond, Series 97X, AMT
LOC: Student Loan Marketing Association................... 09/07/97 13,700,000
1,000,000 Panhandle Plains, Higher Education Authority Inc., 3.35% (b)
Student Loan Revenue Bond, Series 91A, AMT
LOC: Student Loan Marketing Association................... 09/07/97 1,000,000
5,785,000 Port of Port Arthur, 3.25% (b)
Pollution Control Revenue Bond
Star Enterprises Project, Series 97, AMT
LOC: Bank of Montreal..................................... 09/07/97 5,785,000
7,000,000 Port of Port Arthur, 3.45% (b)
Pollution Control Revenue Bond
Star Enterprises Project, Series 94, AMT
LOC: Swiss Bank........................................... 09/07/97 7,000,000
------------
56,157,459
------------
UTAH--3.0%
3,600,000 Salt Lake City, 3.40% (b)
Airport Revenue Bonds, Series 96A, AMT
LOC: Union Bank of Switzerland............................ 09/07/97 3,600,000
9,100,000 Salt Lake County, 3.50% (b)
Solid Waste Revenue Bond
Kennecott Copper Corporation, AMT......................... 09/07/97 9,100,000
------------
12,700,000
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
8
<PAGE> 10
HERITAGE CASH TRUST -- MUNICIPAL MONEY MARKET FUND
STATEMENT OF NET ASSETS
AUGUST 31, 1997
(CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL MATURITY/PUT
AMOUNT DATE* VALUE
--------- ------------ ------------
<C> <S> <C> <C>
VIRGINIA--9.1%
$ 1,600,000 Amelia County, 3.60% (b)
Solid Waste Revenue Bond
Chambers Waste Systems, Inc., AMT
LOC: Morgan Guaranty Trust Company........................ 09/07/97 $ 1,600,000
2,000,000 City of Alexandria Redevelopment and Housing Authority,
3.65% (b) Multi Family Housing Revenue Bond
Buckingham Village Apartments, Series 96B, AMT
LOC: First Union Bank of North Carolina................... 09/07/97 2,000,000
1,500,000 City of Charles, 3.60% (b)
Solid Waste Revenue Bond
Chambers Development of Virginia, Series 96, AMT
LOC: Morgan Guaranty Trust Company........................ 09/07/97 1,500,000
4,450,000 City of Charles, 3.60% (b)
Solid Waste Revenue Bond
Chambers Development of Virginia, Series 91, AMT
LOC: Morgan Guaranty Trust Company........................ 09/07/97 4,450,000
7,500,000 City of Richmond Redevelopment and Housing Authority,
3.50% (b) Multi Family Housing Revenue Bond
Tobacco Row, Series 89B-5, AMT
GIC: Bayerische Landesbank................................ 09/07/97 7,500,000
10,660,000 City of Richmond Redevelopment and Housing Authority,
3.50% (b) Multi-Family Housing Revenue Bond
Tobacco Row, Series 89B-7, AMT
GIC: Bayerische Landesbank................................ 09/07/97 10,660,000
6,295,000 Fairfax County Development Authority, 3.65% (b)
Industrial Development Revenue Bond
Fair Lakes D&K LTD Partnership, Series 96, AMT
LOC: First Union Bank of North Carolina................... 09/07/97 6,295,000
4,000,000 Hampton Roads Jail Authority, 3.30% (b)
Regional Jail Facility, Series 96B
LOC: Wachovia Bank and Trust.............................. 09/07/97 4,000,000
------------
38,005,000
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
9
<PAGE> 11
HERITAGE CASH TRUST -- MUNICIPAL MONEY MARKET FUND
STATEMENT OF NET ASSETS
AUGUST 31, 1997
(CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL MATURITY/PUT
AMOUNT DATE* VALUE
--------- ------------ ------------
<C> <S> <C> <C>
WASHINGTON--3.7%
$ 1,300,000 City of Bremerton, 4.80%
Sewer System Revenue Bond, Series 92A..................... 09/01/97 $ 1,300,000
1,500,000 Washington, 3.45% (b)
Student Loan Revenue Bond, Series 88B, AMT
LOC: National Westminster................................. 09/07/97 1,500,000
12,600,000 Washington, 3.45% (b)
Student Loan Revenue Bond, Series 88A, AMT
LOC: National Westminster................................. 09/07/97 12,600,000
------------
15,400,000
------------
TOTAL INVESTMENTS (cost $430,969,373)(c), 102.8% (a)..................................... 430,969,373
OTHER ASSETS AND LIABILITIES, net, (2.8%) (a)............................................ (11,897,109)
------------
NET ASSETS (net asset value, offering and redemption price of $1.00 per share;
419,138,640 shares outstanding), consisting of paid-in-capital net of accumulated
net realized loss of $66,376, 100.00%.................................................... $419,072,264
============
</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.
AMT--Securities subject to Alternative Minimum Tax
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
The accompanying notes are an integral part of the financial statements.
10
<PAGE> 12
HERITAGE CASH TRUST -- MUNICIPAL MONEY MARKET FUND
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED AUGUST 31, 1997
<TABLE>
<S> <C> <C>
Investment Income
Interest.................................................... $13,507,730
Expenses (Notes 1 and 4):
Management fee............................................ $1,831,037
Distribution fee.......................................... 545,717
Shareholder servicing..................................... 98,946
State registration expenses............................... 83,076
Custodian/Fund accounting fees............................ 77,813
Professional fees......................................... 36,384
Federal registration fees................................. 26,489
Insurance expense......................................... 10,721
Trustees' fees and expenses............................... 7,678
Organization expenses..................................... 7,376
Reports to shareholders................................... 6,510
Other..................................................... 7,024
----------
Total expenses.............................................. 2,738,771
-----------
Net investment income resulting from operations............. $10,768,959
===========
</TABLE>
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FOR THE YEARS ENDED
----------------------------------
AUGUST 31, 1997 AUGUST 31, 1996
--------------- ---------------
<S> <C> <C>
Increase (decrease) in net assets:
Operations:
Net investment income..................................... $ 10,768,959 $ 9,123,484
Distributions to shareholders from net investment income
($.030 and $.030 per share, respectively)................. (10,768,959) (9,123,484)
Increase in net assets from Fund share transactions (Note
2)........................................................ 93,310,792 42,751,733
------------ ------------
Increase in net assets...................................... 93,310,792 42,751,733
Net assets, beginning of year............................... 325,761,472 283,009,739
------------ ------------
Net assets, end of year..................................... $419,072,264 $325,761,472
============ ============
</TABLE>
The accompanying notes are an integral part of the financial statements.
11
<PAGE> 13
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,
----------------------------------------------
1997 1996 1995 1994 1993
------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF YEAR:......................... $1.000 $1.000 $1.000 $1.000 $1.000
------ ------ ------ ------ ------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income(a).................................. .030 .030 .030 .019 .020
LESS DISTRIBUTIONS:
Dividends from net investment income...................... (.030) (.030) (.030) (.019) (.020)
------ ------ ------ ------ ------
NET ASSET VALUE, END OF YEAR:............................... $1.000 $1.000 $1.000 $1.000 $1.000
====== ====== ====== ====== ======
TOTAL RETURN %.............................................. 3.00 2.98 3.04 1.90 2.02
RATIOS TO AVERAGE DAILY NET ASSETS(%)/SUPPLEMENTAL DATA:
Operating expenses, net(a)................................ .75 .77 .77 .77 .77
Net investment income..................................... 2.96 2.94 3.05 1.89 1.98
Net assets, end of year ($ millions)...................... 419 326 283 212 207
</TABLE>
- ---------------
(a) Excludes management fees waived by the Manager in the amount of less than
$.001, $.001 and $.001, per share, for the three periods ended August 31,
1995, respectively. The operating expense ratios including such items would
have been .79%, .77% and .83%, respectively. No management fees were waived
or recovered for the year ended August 31, 1996. The year ended August 31,
1997 includes recovery of previously waived management fees paid to the
Manager of $.01 per share. The operating expense ratios excluding such items
would have been .74%.
The accompanying notes are an integral part of the financial statements.
12
<PAGE> 14
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, 1997, there was an unlimited number of
shares of beneficial interest of no par value authorized. Transactions
in shares and dollars of the Fund during years ended August 31, 1997 and
1996 at a constant net asset value of $1.00 per share, were as follows:
<TABLE>
<CAPTION>
FOR THE YEARS ENDED
----------------------------------
AUGUST 31, 1997 AUGUST 31, 1996
--------------- ---------------
<S> <C> <C>
Shares sold................................................. 1,753,225,618 1,388,242,449
Shares issued on reinvestment of distributions.............. 10,474,052 8,254,216
Shares redeemed............................................. (1,670,388,878) (1,353,744,932)
-------------- --------------
Net increase.............................................. 93,310,792 42,751,733
Shares outstanding:
Beginning of year......................................... 325,827,848 283,076,115
-------------- --------------
End of year............................................... 419,138,640 325,827,848
============== ==============
</TABLE>
Note 3: PURCHASES, SALES AND MATURITIES OF SECURITIES. For the year ended
August 31, 1997, purchases, sales and maturities of short-term
investment securities aggregated $1,193,073,591, $1,002,240,000 and
$84,600,000, 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 waive a portion of the management fee so
that the fee does not exceed the following levels as a percentage of
average daily net assets: .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, 1997 was $202,414. Since
inception, the Manager has voluntarily agreed to waive its fee and, if
necessary, reimburse the Fund to
13
<PAGE> 15
HERITAGE CASH TRUST -- MUNICIPAL MONEY MARKET FUND
NOTES TO FINANCIAL STATEMENTS
(CONTINUED)
the extent that Fund operating expenses exceed .77%, on an annual basis,
of the Fund's average daily net assets. Under this voluntary limitation,
management fees of $40,432 ($.00002 per share) were waived in the year
ended August 31, 1995. In the current year, the Fund's operating
expenses fell below .77% of average daily assets. Accordingly, the Fund
paid the Manager all of the fees waived in 1995.
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. For the year
ended August 31, 1997 the subadviser earned $331,906 for subadviser fees,
which were paid by the Manager.
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, 1997 was $17,200. In addition, the Manager performs Fund
accounting services for the Fund and charged $40,935 during the year of
which $7,100 was payable as of August 31, 1997.
Pursuant to a plan adopted in accordance with Rule 12b-1 of the
Investment Company 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,
1997 was $52,907. 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 paid equally by each of the
Heritage Mutual Funds.
Note 5:FEDERAL INCOME TAXES. As of August 31, 1997, the Fund has net tax basis
capital loss carryforwards of $17,824, $2,029 and $46,523 which may be
applied against any realized net taxable gains until their expiration
dates in 2001, 2003 and 2004, respectively.
14
<PAGE> 16
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, 1997,
the results of its operations for the year then ended and the changes in its net
assets and the financial highlights for each of the two years in the period 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 audits. We conducted our audits 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 audits, which included confirmation of securities at August
31, 1997 by correspondence with the custodian and brokers, provide 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 15, 1997
TAX INFORMATION
(UNAUDITED)
Of the dividends paid from net investment income for the year ended August
31, 1997, 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.
15
<PAGE> 17
[HERITAGE LOGO]
Heritage Cash Trust - Municipal Money Market Fund
P.O. Box 33022
St. Petersburg, FL 33733
Address Change Requested
HERITATE FAMILY OF FUNDS [TM]
From Our Family to Yours:
The Intelligent Creation of Wealth
HERITAGE MONEY MARKET FUNDS
Cash Trust Money Market
Cash Trust Municipal Money Market
HERITAGE BOND FUNDS
Intermediate Government
High Yield
HERITAGE STOCK FUNDS
Income-Growth
Value Equity
Growth Equity
Capital Appreciation
Mid Cap (effective September 29, 1997)
Small Cap
International
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.
