<PAGE> 1
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, 1998
[HERITAGE LOGO]
<PAGE> 2
October 21, 1998
Dear Fellow Shareholders:
I am pleased to provide you with the annual report for Heritage Cash
Trust -- Money Market Fund (the "Fund") for the fiscal year ended August 31,
1998. During the last fiscal year, rates on short-term investments continued to
remain in a relatively narrow range, as they have for the past few years. The
seven-day effective yield for your Fund began the fiscal year at 4.96%,
increased to 4.97% at the end of the semi-annual reporting period on February
28, and stood at 4.99% on August 31. As of the date of this letter, the
seven-day effective yield has fallen to 4.77%.
The domestic economy has been in an expansion for the past 90 months. This
expansion has been unusual, not just for its duration, but for its slow, steady
growth featuring minimal inflationary pressures. Over much of the last two
years, the general concern had been that the Federal Reserve Board (the "Fed")
would increase short-term interest rates at the first signs of a return of
inflation. Very recently however, the Fed has reduced short-term rates twice for
a total of 0.50% in an effort to forestall a slowdown in our economic growth.
This situation has been brought about, not because of any fundamental change in
our domestic situation, but because of the financial crisis that has spread
throughout many Asian, European and Latin American economies. The revenues and
profits of many U.S. multinational businesses are beginning to show the negative
effects of this worldwide situation, as many of their export markets are not
able to continue their historic purchase levels of our products. Because of the
Fed's action to reduce short-term rates, the yield on your Fund also will fall
as the income from the securities in which we invest will decline. We believe
that the Fed's near-term bias will be to reduce rates further, if necessary, to
help our economic expansion continue.
As U.S. stock markets suffered as investors worried about corporate
earnings, money market funds and other short-term fixed income attractions have
provided a safe haven for a portion of many investors' portfolios. In fact, over
the past six months, very few equity index returns are positive, making money
market funds one of the best performing investment categories over this period.
We encourage you to take this opportunity to review your investment portfolio
with your financial advisor to ensure that you have an asset allocation strategy
that is designed to meet your individual needs.
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
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 (including free checks and returned
cancelled checks), 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.
On behalf of all of us at Heritage Asset Management, thank you for your
continuing investment in Heritage Cash Trust -- Money Market Fund.
Sincerely,
/s/ STEPHEN G. HILL
Stephen G. Hill
President
<PAGE> 3
- --------------------------------------------------------------------------------
HERITAGE CASH TRUST -- MONEY MARKET FUND
STATEMENT OF NET ASSETS
AUGUST 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL AMORTIZED
AMOUNT COST
------ ----
<C> <S> <C>
COMMERCIAL PAPER--75.5%(A)
DOMESTIC--58.3%
BANKING--3.3%
$ 50,000,000 Bank of America, FSB,
5.50%, due 10/27/98...... $ 49,572,222
33,000,000 BankAmerica Corporation,
5.50%, due 10/13/98...... 32,788,250
--------------
82,360,472
--------------
BEVERAGES--4.8%
75,000,000 The Coca-Cola Company,
5.48%, due 10/13/98...... 74,520,500
45,000,000 PepsiCo, Inc., 5.48%, due
10/30/98................. 44,595,850
--------------
119,116,350
--------------
COMPUTER/OFFICE EQUIPMENT--0.8%
20,000,000 Xerox Credit Corporation,
5.48%, due 10/16/98...... 19,863,000
--------------
CONGLOMERATES--2.2%
30,000,000 Minnesota Mining &
Manufacturing Company,
5.46%, due 11/19/98...... 29,640,550
25,000,000 Minnesota Mining &
Manufacturing Company,
5.47%, due 12/21/98...... 24,580,667
--------------
54,221,217
--------------
CORPORATE FINANCE--9.4%
25,000,000 Ciesco, L.P., 5.50%, due
10/21/98................. 24,809,028
25,000,000 Ciesco, L.P., 5.51%, due
10/21/98................. 24,808,681
25,000,000 Ciesco, L.P., 5.50%, due
10/22/98................. 24,805,208
25,000,000 Corporate Asset Funding
Company Inc., 5.50%, due
11/05/98................. 24,751,736
15,000,000 Corporate Asset Funding
Company Inc., 5.51%, due
11/10/98................. 14,839,292
50,000,000 General Electric Capital
Corporation, 5.49%, due
09/14/98................. 49,900,875
10,000,000 General Electric Capital
Corporation, 5.50%, due
11/19/98................. 9,879,306
5,000,000 Private Export Funding
Corporation, 5.48%, due
11/02/98................. 4,952,811
56,900,000 Private Export Funding
Corporation, 5.48%, due
11/20/98................. 56,207,084
--------------
234,954,021
--------------
PRINCIPAL AMORTIZED
AMOUNT COST
------ ----
<C> <S> <C>
COMMERCIAL PAPER (CONTINUED)
ELECTRONICS--2.4%
7,000,000 Emerson Electric Company,
5.48%, due 09/16/98...... 6,984,017
8,055,000 Emerson Electric Company,
5.50%, due 09/23/98...... 8,027,926
9,000,000 Emerson Electric Company,
5.50%, due 09/24/98...... 8,968,375
8,250,000 Emerson Electric Company,
5.46%, due 09/30/98...... 8,213,714
18,600,000 Emerson Electric Company,
5.47%, due 09/30/98...... 18,518,041
9,968,000 Emerson Electric Company,
5.50%, due 10/09/98...... 9,910,130
--------------
60,622,203
--------------
FOOD--10.6%
50,000,000 Campbell Soup Company,
5.41%, due 09/22/98...... 49,842,208
50,000,000 Cargill, Inc., 5.51%, due
09/04/98................. 49,977,042
25,000,000 Cargill, Inc., 5.49%, due
10/02/98................. 24,881,813
19,000,000 H.J. Heinz Company, 5.53%,
due 09/08/98............. 18,979,570
21,000,000 H.J. Heinz Company, 5.52%,
due 09/15/98............. 20,954,920
20,000,000 H.J. Heinz Company, 5.52%,
due 09/17/98............. 19,950,933
15,550,000 Kellogg Company, 5.50%,
due 10/08/98............. 15,462,099
24,500,000 Kellogg Company, 5.48%,
due 10/09/98............. 24,358,281
40,400,000 Sara Lee Corporation,
5.78%, due 09/01/98...... 40,400,000
--------------
264,806,866
--------------
HOUSEHOLD PRODUCTS--5.2%
20,000,000 Colgate-Palmolive Company,
5.50%, due 09/15/98...... 19,957,222
13,470,000 The Clorox Company, 5.49%,
due 10/23/98............. 13,363,183
25,000,000 The Procter & Gamble
Company, 5.48%, due
09/25/98................. 24,908,667
23,000,000 The Procter & Gamble
Company, 5.47%, due
11/10/98................. 22,755,369
50,000,000 The Procter & Gamble
Company, 5.45%, due
12/18/98................. 49,182,500
--------------
130,166,941
--------------
NEWSPAPERS/PUBLISHING--0.2%
4,450,000 McGraw-Hill, Inc., 5.49%,
due 09/10/98............. 4,443,892
--------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
2
<PAGE> 4
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HERITAGE CASH TRUST -- MONEY MARKET FUND
STATEMENT OF NET ASSETS
AUGUST 31, 1998
(CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL AMORTIZED
AMOUNT COST
------ ----
<C> <S> <C>
COMMERCIAL PAPER (CONTINUED)
OIL & GAS--7.4%
$ 35,000,000 Amoco Corporation, 5.46%,
due 12/17/98............. $ 34,432,008
35,000,000 Chevron UK Investment PLC,
5.44%, due 09/15/98...... 34,925,956
10,000,000 Chevron UK Investment PLC,
5.50%, due 11/03/98...... 9,903,750
5,000,000 Chevron UK Investment PLC,
5.50%, due 11/16/98...... 4,941,944
25,000,000 Chevron USA, Inc., 5.49%,
due 09/04/98............. 24,988,563
75,000,000 Shell Oil Company, 5.48%,
due 10/16/98............. 74,486,250
--------------
183,678,471
--------------
PAPER--0.4%
10,000,000 Kimberly-Clark
Corporation, 5.50%, due
09/17/98................. 9,975,556
--------------
PHARMACEUTICALS--4.1%
40,550,000 Abbott Laboratories,
5.48%, due 09/10/98...... 40,494,446
55,980,000 Abbott Laboratories,
5.48%, due 09/17/98...... 55,843,658
7,000,000 Pfizer, Inc., 5.50%, due
09/10/98................. 6,990,375
--------------
103,328,479
--------------
RECREATION--2.4%
40,000,000 The Walt Disney Company,
5.48%, due 09/01/98...... 40,000,000
19,000,000 The Walt Disney Company,
5.50%, due 09/04/98...... 18,991,292
--------------
58,991,292
--------------
TELEPHONE/UTILITIES--4.1%
38,265,000 Bell Atlantic Network
Funding Corporation,
5.50%, due 09/11/98...... 38,206,540
50,000,000 BellSouth
Telecommunications Inc.,
5.48%, due 09/02/98...... 49,992,389
15,000,000 BellSouth
Telecommunications Inc.,
5.50%, due 09/14/98...... 14,970,208
--------------
103,169,137
--------------
TRANSPORTATION--1.0%
25,000,000 United Parcel Service,
5.75%, due 09/01/98...... 25,000,000
--------------
Total Domestic (cost $1,454,697,897)....... 1,454,697,897
--------------
<CAPTION>
PRINCIPAL AMORTIZED
AMOUNT COST
------ ----
<C> <S> <C>
COMMERCIAL PAPER (CONTINUED)
FOREIGN--17.2%(B)
BANKING--2.4%
31,800,000 Abbey National North
America, 5.50%, due
09/24/98................. 31,688,258
28,200,000 Abbey National North
America, 5.47%, due
11/20/98................. 27,857,214
--------------
59,545,472
--------------
CORPORATE FINANCE--6.4%
46,100,000 Export Development
Corporation, 5.75%, due
09/01/98................. 46,100,000
48,000,000 Export Development
Corporation, 5.47%, due
11/13/98................. 47,467,587
40,000,000 The Canadian Wheat Board,
5.49%, due 09/15/98...... 39,914,600
27,000,000 The Canadian Wheat Board,
5.47%, due 11/16/98...... 26,688,210
--------------
160,170,397
--------------
FOOD--3.0%
20,000,000 Unilever Capital
Corporation, 5.50%, due
09/03/98................. 19,993,888
25,000,000 Unilever NV, 5.49%, due
10/08/98................. 24,858,938
30,000,000 Unilever NV, 5.46%, due
12/04/98................. 29,572,300
--------------
74,425,126
--------------
PHARMACEUTICALS--5.4%
60,000,000 Glaxo Wellcome, PLC,
5.50%, due 09/22/98...... 59,807,500
22,000,000 SmithKline Beecham
Corporation, 5.50%, due
09/17/98................. 21,946,222
53,000,000 SmithKline Beecham
Corporation, 5.50%, due
09/18/98................. 52,862,347
--------------
134,616,069
--------------
Total Foreign (cost $428,757,064).......... 428,757,064
--------------
Total Commercial Paper (cost
$1,883,454,961)............................ 1,883,454,961
--------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
3
<PAGE> 5
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HERITAGE CASH TRUST -- MONEY MARKET FUND
STATEMENT OF NET ASSETS
AUGUST 31, 1998
(CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL AMORTIZED
AMOUNT COST
------ ----
<C> <S> <C>
CORPORATE NOTES--7.4%(A)
- -----------------------------------------------------------
BANKING--6.0%
$ 65,500,000 First Union National Bank,
5.56%, due 09/23/98...... $ 65,500,000
9,500,000 First Union National Bank,
5.55%, due 11/16/98...... 9,500,000
75,000,000 Wachovia Bank of North
Carolina, Bank Note,
5.55%, due 09/08/98...... 75,000,000
--------------
150,000,000
--------------
BEVERAGES--0.6%
15,000,000 PepsiCo, Inc., 5.50%, due
08/19/99................. 14,983,676
--------------
CORPORATE FINANCE--0.8%
1,285,177 Capita Equipment
Receivable Trust 1997-1,
Class A-1, 5.79%, due
12/15/98................. 1,285,177
17,343,510 Chase Manhattan Auto Owner
Trust 1998-C A1, 5.59%,
due 07/09/99............. 17,342,333
--------------
18,627,510
--------------
Total Corporate Notes (cost
$183,611,186).............................. 183,611,186
--------------
U.S. GOVERNMENT AND AGENCY SECURITIES--10.6%(A)
- -----------------------------------------------
60,000,000 Fannie Mae, 5.44%, due
09/15/98................. 59,873,137
15,000,000 Fannie Mae, 5.41%, due
10/09/98................. 14,914,294
25,000,000 Fannie Mae, 5.43%, due
10/09/98................. 24,856,708
55,000,000 Federal Home Loan Bank,
5.33%, due 09/23/98...... 54,820,853
10,000,000 Federal Home Loan Bank,
5.37%, due 09/25/98...... 9,964,200
20,000,000 Freddie Mac, 5.46%, due
09/18/98................. 19,948,414
15,000,000 Freddie Mac, 5.41%, due
10/08/98................. 14,916,519
40,000,000 Freddie Mac, 5.44%, due
10/09/98................. 39,770,311
25,000,000 Freddie Mac, 5.45%, due
10/14/98................. 24,837,257
--------------
Total U.S. Government and Agency Securities
(cost $263,901,693)........................ 263,901,693
--------------
Total Investment Portfolio excluding
repurchase agreement (cost
$2,330,967,840)............................ 2,330,967,840
--------------
<CAPTION>
PRINCIPAL AMORTIZED
AMOUNT COST
------ ----
<S> <C>
REPURCHASE AGREEMENT--6.7%(A)
Repurchase Agreement with State Street Bank
and Trust Company, dated August 31, 1998 @
5.82% to be repurchased at $167,437,065 on
September 1, 1998, collateralized by
$15,070,000 United States Treasury Notes,
6.75% due August 15, 2026, $19,285,000
United States Treasury Notes, 8.125% due
August 15, 2019, $40,850,000 United States
Treasury Notes, 7.5% due November 15, 2016,
$42,770,000 United States Treasury Notes,
6.88% due August 15, 2025 and $19,695,000
United States Treasury Notes, 10.0% due May
15, 2010 (market value $171,429,120
including interest) (cost $167,410,000).... 167,410,000
--------------
TOTAL INVESTMENTS
(cost $2,498,377,840)(c)100.2%(a)......... 2,498,377,840
OTHER ASSETS AND LIABILITIES, net,
(0.2%)(a).................................. (3,837,597)
--------------
NET ASSETS, (CONSISTING OF PAID-IN-CAPITAL
NET OF ACCUMULATED NET REALIZED LOSS OF
$268,158)
100.0%.....................................
$2,494,540,243
==============
CLASS A SHARES
- --------------
Net asset value, offering and redemption
price per share, ($2,491,658,563 divided by
2,491,926,721 shares outstanding).......... $1.00
==============
CLASS B SHARES
- --------------
Net asset value, offering and redemption
price per share, ($211,647 divided by
211,647 shares outstanding)................ $1.00
==============
CLASS C SHARES
- --------------
Net asset value, offering and redemption
price per share, ($2,670,033 divided by
2,670,033 shares outstanding).............. $1.00
==============
- --------------
(a) Percentages are based on net assets.
(b) U.S. dollar denominated.
(c) The aggregate identified cost for federal income tax
purposes is the same.
</TABLE>
The accompanying notes are an integral part of the financial statements.
4
<PAGE> 6
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HERITAGE CASH TRUST -- MONEY MARKET FUND
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED AUGUST 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
Investment Income:
Interest.................................................... $126,127,017
Expenses (Notes 1 and 4):
Management fee............................................ $10,209,544
Distribution fee (Class A Shares)......................... 3,358,905
Distribution fee (Class B Shares)*........................ 25
Distribution fee (Class C Shares)......................... 899
Shareholder servicing fees................................ 2,504,494
State qualification expenses.............................. 225,905
Custodian/Fund Accounting fees............................ 191,334
Federal registration fees................................. 138,155
Reports to shareholders................................... 107,300
Professional fees......................................... 54,748
Insurance expense......................................... 19,169
Trustees' fees and expenses............................... 8,180
Other..................................................... 27,541
-----------
Total expenses...................................... 16,846,199
------------
Net investment income....................................... 109,280,818
Realized Gain on Investments
Net realized gain from investment transactions.............. 682
------------
Net increase in net assets resulting from operations........ $109,281,500
============
</TABLE>
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FOR THE YEARS ENDED
------------------------------------
AUGUST 31, 1998 AUGUST 31, 1997
----------------- ---------------
<S> <C> <C>
Increase (decrease) in net assets:
Operations:
Net investment income..................................... $ 109,280,818 $ 88,152,268
Net realized gain (loss) on investment transactions....... 682 (28,062)
-------------- --------------
Net increase in net assets resulting from operations...... 109,281,500 88,124,206
Distributions to shareholders from:
Net investment income Class A Shares, ($0.049 and $0.047
per share, respectively)................................ (109,250,845) (88,101,933)
Net investment income Class B Shares, ($0.027 per
share)*................................................. (799) --
Net investment income Class C Shares, ($0.049 and $0.047
per share, respectively)................................ (29,174) (50,335)
Increase in net assets from Fund share transactions (Note
2)........................................................ 478,532,212 375,093,274
-------------- --------------
Increase in net assets...................................... 478,532,894 375,065,212
Net assets, beginning of year............................... 2,016,007,349 1,640,942,137
-------------- --------------
Net assets, end of year..................................... $2,494,540,243 $2,016,007,349
============== ==============
</TABLE>
* For the period January 2, 1998 (commencement of Class B Shares) to August 31,
1998.
The accompanying notes are an integral part of the financial statements.
5
<PAGE> 7
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HERITAGE CASH TRUST -- 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>
CLASS B
CLASS A SHARES SHARES CLASS C SHARES
------------------------------------------ ------------ -------------------------------
FOR THE
FOR THE YEARS ENDED AUGUST 31, PERIOD ENDED FOR THE YEARS ENDED AUGUST 31,
------------------------------------------ AUGUST 31, -------------------------------
1998 1997 1996 1995 1994 1998++ 1998 1997 1996+
------ ------ ------ ------ ------ ------------ -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF
YEAR.............................. $1.000 $1.000 $1.000 $1.000 $1.000 $1.000 $1.000 $1.000 $1.000
------ ------ ------ ------ ------ ------ ------ ------ ------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (a)(b)...... .049 .047 .048 .050 .029 .027 .049 .047 .023
LESS DISTRIBUTIONS:
Dividends from net investment
income and net realized gains
(a)............................. (.049) (.047) (.048) (.050) (.029) (.027) (.049) (.047) (.023)
------ ------ ------ ------ ------ ------ ------ ------ ------
NET ASSET VALUE, END OF YEAR........ $1.000 $1.000 $1.000 $1.000 $1.000 $1.000 $1.000 $1.000 $1.000
====== ====== ====== ====== ====== ====== ====== ====== ======
TOTAL RETURN %...................... 4.99 4.85 4.89 5.00 2.87 2.70(d) 4.99 4.85 2.34(d)
RATIOS TO AVERAGE DAILY NET
ASSETS (%)/SUPPLEMENTAL DATA:
Operating expenses, net (b)....... .75 .76 .78 .79 .79 .75(c) .75 .77 .75(c)
Net investment income (b)......... 4.88 4.74 4.78 5.00 2.87 4.86(c) 4.87 4.72 4.62(c)
Net assets, end of year ($
millions)....................... 2,492 2,016 1,641 1,294 982 .21 3 .51 --
</TABLE>
- ---------------
+ For the period February 29, 1996 (commencement of Class C Shares) to August
31, 1996.
++ For the period January 2, 1998 (commencement of Class B Shares) to August
31, 1998.
(a) Includes net realized gains and losses which were less than $.001 per share
for each of the periods.
(b) Excludes management fees waived by the Manager in the amount of less than
$.001 and $.001 per share, for the two years ended August 31, 1995 and 1994,
respectively. The operating expense ratios including such items would have
been .81% and .81%, 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 less than $.01 per share. The operating expense ratios for fiscal 1997,
excluding such items would have been .75% for Class A and C Shares. No
management fees were waived or recovered for the year ended August 31, 1998.
(c) Annualized.
(d) Not annualized.
The accompanying notes are an integral part of the financial statements.
6
<PAGE> 8
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HERITAGE CASH TRUST -- 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 diversified, open-end
management investment company consisting of two separate investment
portfolios, the Money Market Fund (the "Fund") and the Municipal Money
Market Fund. The Fund is designed for investors who wish to participate
in a portfolio of debt securities with remaining maturities of not more
than 397 days. The Fund offers three classes of shares, Class A, Class B
and Class C Shares. Class A Shares, B Shares and C Shares may be
acquired by direct purchase or through exchange of shares of the
corresponding class of another Heritage Mutual Fund. 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.
Repurchase Agreements: The Fund enters into repurchase agreements
whereby the Fund, through its custodian, receives delivery of the
underlying securities, the market value of which at the time of purchase
is required to be an amount equal to at least 100% of the resale price.
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.
Expenses: The Fund is charged for those expenses which are directly
attributable to it, such as management fee, custodian/fund accounting
fees, distribution fee, etc., while other expenses such as professional
fees, insurance expense, etc., are allocated proportionately among the
Heritage Funds. Expenses of the Fund are allocated to each class of
shares based upon their relative percentage of current net assets. All
expenses that are directly attributable to a specific class of shares,
such as distribution fees, are charged directly to that class.
State Qualification Expenses: State qualification fees are amortized
based either on the time period covered by the qualification or as
related shares are sold, whichever is appropriate for each state.
Other: Investment transactions are recorded on a trade date basis.
Interest income is recorded on the accrual basis.
Note 2: FUND SHARES. At August 31, 1998, there was an unlimited number of
shares of beneficial interest of no par value authorized.
Transactions in Class A and C Shares and dollars of the Fund during the
year ended August 31, 1998 and Class B Shares from January 2, 1998
(commencement of Class B Shares) to August 31, 1998 at a constant net
asset value of $1.00 per share, were as follows:
<TABLE>
<CAPTION>
A SHARES B SHARES C SHARES
-------- -------- ----------
<S> <C> <C> <C>
FOR THE YEAR ENDED AUGUST 31, 1998
------------------------------------------------------------
Shares sold................................................. 10,388,248,179 413,612 6,488,760
Shares issued on reinvestment of distributions.............. 117,451,319 692 30,563
Shares redeemed............................................. (10,029,543,511) (202,657) (4,354,744)
--------------- -------- ----------
Net increase.............................................. 476,155,987 211,647 2,164,579
Shares outstanding:
Beginning of year......................................... 2,015,770,734 -- 505,454
--------------- -------- ----------
End of year............................................... 2,491,926,721 211,647 2,670,033
=============== ======== ==========
</TABLE>
7
<PAGE> 9
- --------------------------------------------------------------------------------
HERITAGE CASH TRUST -- MONEY MARKET FUND
NOTES TO FINANCIAL STATEMENTS
(CONTINUED)
- --------------------------------------------------------------------------------
Transactions in Class A and C Shares and dollars of the Fund during the
year ended August 31, 1997 at a constant net asset value of $1.00 per
share, were as follows.
<TABLE>
<CAPTION>
A SHARES C SHARES
-------------- ----------
<S> <C> <C>
FOR THE YEAR ENDED AUGUST 31, 1997
------------------------------------------------------------
Shares sold................................................. 8,170,400,843 3,602,752
Shares issued on reinvestment of distributions.............. 85,579,732 48,452
Shares redeemed............................................. (7,881,206,649) (3,331,857)
-------------- ----------
Net increase................................................ 374,773,926 319,347
Shares outstanding:
Beginning of year......................................... 1,640,996,808 186,107
-------------- ----------
End of year............................................... 2,015,770,734 505,454
============== ==========
</TABLE>
Note 3: PURCHASES, SALES AND MATURITIES OF SECURITIES. For the year ended
August 31, 1998, purchases, sales and maturities of short-term
investment securities, excluding repurchase agreements, aggregated
$22,722,113,222, $59,981,667 and $22,344,990,650, respectively.
Purchases and maturities of U.S. Government obligations aggregated
$812,089,357 and $879,677,000, respectively.
Note 4: MANAGEMENT, DISTRIBUTION, SHAREHOLDER SERVICING AGENT, FUND ACCOUNTING
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, 0.40% of the next
$500,000,000, and 0.375% of any excess over $2,500,000,000 of such net
assets, computed daily and payable monthly. The amount payable to the
Manager as of August 31, 1998 was $959,792. Pursuant to the Prospectus
dated January 2, 1998, the Manager voluntarily agreed to waive its fees
or other expenses and, if necessary, reimburse the Fund to the extent
that Class A, Class B and Class C annual operating expenses exceed .75%
of the average daily net assets attributable to that class for the
fiscal year ended August 31, 1998.
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, 1998 was $429,000. In addition, the Manager performs Fund
Accounting services for the Fund and charged $42,357 during the period,
of which $7,000 was payable as of August 31, 1998.
Raymond James & Associates, Inc. (the "Distributor") has advised the
Fund that it received $9,715 in contingent deferred sales charges for
Class B Shares and $4,258 in contingent deferred sales charges for Class
C Shares for the year ended August 31, 1998.
Pursuant to plans adopted in accordance with Rule 12b-1 of the
Investment Company Act of 1940, as amended, the Fund pays the
Distributor a fee up to 0.15% of average daily net assets for the
services it provides in connection with the promotion and distribution
of Class A, Class B and Class C Fund shares. Such fee is accrued daily
and payable monthly. The amount payable to the Distributor as of August
31, 1998 was $312,771. 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 employee of the
Manager or an employee of an affiliate of the Manager receives an annual
fee of $8,666 and an additional fee of $3,250 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, 1998, the Fund has net tax basis
capital loss carryforwards of $283,877, in the aggregate. Capital loss
carryforwards in the amount of $682 were utilized in the current year.
Capital loss carryforwards in the amount of $9,000, $6,037, $235,118 and
$33,722 may be applied to any net taxable gains until their expiration
dates in 2002, 2003, 2004, and 2005, respectively.
8
<PAGE> 10
- --------------------------------------------------------------------------------
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
- --------------------------------------------------------------------------------
To the Board of Trustees and Shareholders of
Heritage Cash Trust - 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 - Money Market Fund (the "Fund") at August 31, 1998, the
results of its operations for the year then ended, the changes in its net assets
for each of the two years in the period then ended and the financial highlights
for each of the periods presented, 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, 1998 by correspondence with the
custodian, provide a reasonable basis for the opinion expressed above.
/s/ PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
Tampa, Florida
October 14, 1998
9
<PAGE> 11
HERITAGE CASH TRUST-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
MUNICIPAL MONEY MARKET FUND
-- HERITAGE CAPITAL APPRECIATION TRUST
-- HERITAGE INCOME-GROWTH TRUST
-- HERITAGE INCOME TRUST
INTERMEDIATE GOVERNMENT FUND
HIGH YIELD BOND FUND
-- HERITAGE SERIES TRUST
AGGRESSIVE GROWTH FUND
EAGLE INTERNATIONAL EQUITY PORTFOLIO
GROWTH EQUITY FUND
MID CAP GROWTH 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
financial advisor. Please read the Prospectus carefully before you invest in any
of the funds.
<PAGE> 12
[Heritage Logo]
Heritage Cash Trust - Money Market Fund
P.O. Box 33022
St. Petersburg, FL 33733
Address Change Requested
HERITAGE 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
Aggressive Growth
Income-Growth
Value Equity
Growth Equity
Capital Appreciation
Mid Cap
Small Cap
International
This report is for the information of shareholders of Heritage Cash Trust -
Money Market Fund. It may also be used as sales literature when preceded or
accompanied by a prospectus.
[Recycled Logo] Printed on recycled paper
