<PAGE> 1
MONEY
MARKET [BAR LOGO]
FUND
[Pictures of People Working & Playing]
From Our Family to Yours: The Intelligent Creation of Wealth.
SEMIANNUAL REPORT
(unaudited) and Investment Performance
Review for the Year Ended
February 28, 1999
[HERITAGE LOGO]
<PAGE> 2
April 12, 1999
Dear Fellow Shareholders:
It is my pleasure to provide you with the semiannual report for the
Heritage Cash Trust -- Money Market Fund (the "Fund") for the six month period
from September 1, 1998 through February 28, 1999. After remaining reasonably
stable over the prior twelve months, the seven day effective yield for your Fund
declined from 4.99% on August 31, 1998 to 4.24% on February 28, 1999. Rates on
most short-term investments trended lower over this period as a result of the
actions taken last fall by the Federal Reserve Board (the "Fed") to reduce
short-term rates to help prevent a slowdown in our economy.
The Fed's action seems to have had the desired effect of forestalling an
economic downturn. In fact, the argument now is over whether the rate reductions
have contributed to a situation in which the U.S. economy may be expanding too
rapidly, bringing the concern over inflation back into the forefront of economic
policy discussions. The history of the Fed under current Chairman Alan Greenspan
indicates that controlling inflation will be the Fed's primary focus in the
near-term. Thus, unless the rate of domestic economic growth slows, the next
moves by the Fed are likely to be to increase rates slightly. To at least the
partial credit of this Fed, our current period of economic expansion is
beginning its ninth year. In addition to its unusual length, this expansion has
been remarkable for its relative consistency, featuring slow, steady growth with
very little inflation.
The past few years have featured a stock market that has moved generally
upward, at least if we simply focus on the returns from major stock market
indexes. Volatility has continued to be significant, and more importantly, many
segments of the market have not really participated in the gains indicated by
those index returns. In particular, smaller market capitalization stocks and
value stocks have not enjoyed the increases of many large cap growth stocks and
technology stocks. During volatile market periods -- and maybe all markets
qualify as volatile -- an allocation of a portfolio of your assets to high
quality short-term securities can help stabilize portfolio returns and provide
some measure of comfort. As a reminder, your Fund continues to maintain a AAAm
rating from Standard & Poor's Rating Group. Your Fund also offers a wide range
of features that, we hope, make your Fund convenient for you to use. These
include free checking (including free checks and returned cancelled checks),
daily sweeps to and from your brokerage accounts and various automated payment
programs.
On behalf of all of us at Heritage, thank you for your continuing
investment in Heritage Cash Trust -- Money Market Fund. If there are ever any
suggestions you would like to share with us about how we can better serve you,
please call us at 800/709-3863 (FUND).
Sincerely,
/s/ STEPHEN G. HILL
Stephen G. Hill
President
<PAGE> 3
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HERITAGE CASH TRUST -- MONEY MARKET FUND
STATEMENT OF NET ASSETS
FEBRUARY 28, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL AMORTIZED
AMOUNT COST
------ ----
<C> <S> <C>
COMMERCIAL PAPER--75.8%(A)
DOMESTIC--60.6%
BANKING--1.7%
$ 50,000,000 Wachovia Corporation,
4.80%, 04/09/99.......... $ 49,740,000
--------------
CHEMICALS--3.4%
25,000,000 E.I. du Pont de Nemours &
Company, 4.76%,
06/08/99................. 24,672,750
25,000,000 E.I. du Pont de Nemours &
Company, 4.82%,
06/08/99................. 24,668,625
50,000,000 E.I. du Pont de Nemours &
Company, 4.83%,
04/27/99................. 49,617,625
--------------
98,959,000
--------------
COMMERCIAL PRINTING--1.8%
17,260,000 R.R. Donnelley & Sons
Company, 4.80%,
04/08/99................. 17,172,549
36,200,000 R.R. Donnelley & Sons
Company, 4.84%,
03/16/99................. 36,126,997
--------------
53,299,546
--------------
COMPUTER/OFFICE EQUIPMENT--0.7%
20,000,000 Xerox Credit Corporation,
4.78%, 03/19/99.......... 19,952,200
--------------
CORPORATE FINANCE--4.1%
20,000,000 General Electric Capital
Corporation, 4.78%,
07/16/99................. 19,636,189
30,000,000 General Electric Capital
Corporation, 4.99%,
04/15/99................. 29,812,875
10,000,000 Private Export Funding
Corporation, 4.68%,
05/06/99................. 9,914,200
15,000,000 Private Export Funding
Corporation, 4.72%,
05/06/99................. 14,870,200
25,000,000 Private Export Funding
Corporation, 4.76%,
05/07/99................. 24,778,528
20,000,000 Private Export Funding
Corporation, 4.78%,
03/12/99................. 19,970,789
--------------
118,982,781
--------------
ELECTRONICS--4.8%
19,000,000 Emerson Electric Company,
4.78%, 03/10/99.......... 18,977,295
61,400,000 Emerson Electric Company,
4.78%, 03/12/99.......... 61,310,322
19,500,000 Emerson Electric Company,
4.79%, 03/15/99.......... 19,463,676
9,849,000 Motorola Credit
Corporation, 4.80%,
05/13/99................. 9,753,136
11,496,000 Motorola, Inc., 4.80%,
04/29/99................. 11,405,565
17,225,000 Motorola, Inc., 4.80%,
04/30/99................. 17,087,200
--------------
137,997,194
--------------
FOOD--4.6%
45,000,000 Campbell Soup Company,
4.82%, 04/27/99.......... 44,656,575
19,000,000 H.J. Heinz Company, 4.78%,
03/11/99................. 18,974,773
6,400,000 Kellogg Company, 4.75%,
03/26/99................. 6,378,889
19,250,000 Kellogg Company, 4.78%,
03/19/99................. 19,203,992
9,200,000 Kellogg Company, 4.78%,
03/04/99................. 9,196,335
30,000,000 Sara Lee Corporation,
4.79%, 03/10/99.......... 29,964,075
5,500,000 Sara Lee Corporation,
4.79%, 03/11/99.......... 5,492,682
--------------
133,867,321
--------------
HOUSEHOLD PRODUCTS--4.7%
60,000,000 The Clorox Company, 4.78%,
05/13/99................. 59,418,433
15,750,000 The Procter & Gamble
Company, 4.74%,
04/30/99................. 15,625,575
6,223,000 The Procter & Gamble
Company, 4.78%,
03/18/99................. 6,208,954
11,994,000 The Procter & Gamble
Company, 4.78%,
04/21/99................. 11,912,781
15,000,000 The Procter & Gamble
Company, 4.79%,
03/26/99................. 14,950,104
7,200,000 The Procter & Gamble
Company, 4.80%,
05/12/99................. 7,130,880
20,000,000 The Procter & Gamble
Company, 4.81%,
06/11/99................. 19,727,433
--------------
134,974,160
--------------
MEDICAL SUPPLIES--1.2%
11,150,000 Johnson & Johnson, 4.72%,
06/23/99................. 10,983,345
</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
FEBRUARY 28, 1999
(UNAUDITED)
(CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL AMORTIZED
AMOUNT COST
------ ----
<C> <S> <C>
COMMERCIAL PAPER (CONTINUED)
$ 25,000,000 Johnson & Johnson, 4.84%,
03/03/99................. $ 24,993,277
--------------
35,976,622
--------------
OIL & GAS--6.9%
10,000,000 Chevron UK Investment PLC,
4.78%, 06/10/99.......... 9,864,566
35,000,000 Chevron UK Investment PLC,
4.83%, 06/18/98.......... 34,488,154
55,000,000 Chevron USA Inc, 4.80%,
05/24/99................. 54,384,000
25,000,000 Shell Oil Company, 4.77%,
03/12/99................. 24,963,563
75,000,000 Shell Oil Company, 4.77%,
03/26/99................. 74,751,563
--------------
198,451,846
--------------
PAPER--0.5%
14,000,000 Kimberly-Clark
Corporation, 4.78%,
03/10/99................. 13,966,540
--------------
PHARMACEUTICALS--12.8%
44,500,000 Abbott Laboratories,
4.77%, 03/01/99.......... 44,500,000
30,000,000 Abbott Laboratories,
4.78%, 03/09/99.......... 29,968,133
25,500,000 Abbott Laboratories,
4.79%, 03/23/99.......... 25,425,356
100,000,000 Eli Lilly & Company,
4.75%, 03/12/99.......... 99,854,861
30,000,000 Pfizer, Inc., 4.76%,
03/24/99................. 29,908,766
60,000,000 Pfizer, Inc., 4.80%,
03/15/99................. 59,888,000
10,000,000 Pfizer, Inc., 4.82%,
03/01/99................. 10,000,000
25,400,000 Schering Corporation,
4.83%, 03/16/99.......... 25,348,883
15,000,000 Schering Corporation,
4.83%, 04/13/99.......... 14,913,463
28,107,000 Schering Corporation,
4.83%, 06/22/99.......... 27,680,874
--------------
367,488,336
--------------
RECREATION--1.7%
50,000,000 The Walt Disney Company,
4.74%, 04/22/99.......... 49,657,667
--------------
RESTAURANTS--1.3%
37,000,000 McDonald's Corporation,
4.78%, 03/01/99.......... 37,000,000
--------------
TELEPHONE/UTILITIES--10.4%
100,000,000 Ameritech Corporation,
4.77%, 03/04/99.......... 99,960,250
7,925,000 AT&T Corporation, 4.82%,
03/25/99................. 7,899,534
50,000,000 AT&T Corporation, 4.82%,
03/31/99................. 49,799,166
42,075,000 AT&T Corporation, 4.83%,
03/30/99................. 41,911,293
8,250,000 BellSouth Capital Funding
Corporation, 4.75%,
04/26/99................. 8,189,042
30,000,000 BellSouth
Telecommunications Inc.,
4.78%, 03/26/99.......... 29,900,417
30,000,000 BellSouth
Telecommunications Inc.,
4.79%, 03/11/99.......... 29,960,083
20,000,000 BellSouth
Telecommunications Inc.,
4.82%, 04/14/99.......... 19,882,178
11,000,000 BellSouth
Telecommunications Inc.,
4.82%, 04/09/99.......... 10,942,562
--------------
298,444,525
--------------
Total Domestic (cost $1,748,757,738)....... 1,748,757,738
--------------
FOREIGN--15.2% (B)
CORPORATE FINANCE--6.8%
25,700,000 Province of British
Columbia, 4.69%,
07/30/99................. 25,194,431
39,400,000 Province of British
Columbia, 4.77%,
06/08/99................. 38,883,171
14,900,000 Province of British
Columbia, 4.78%,
05/12/99................. 14,757,556
13,600,000 Province of British
Columbia, 4.80%,
05/13/99................. 13,467,627
6,400,000 Province of British
Columbia, 4.95%,
05/10/99................. 6,338,400
25,000,000 The Canadian Wheat Board,
4.70%, 07/23/99.......... 24,530,000
33,700,000 The Canadian Wheat Board,
4.78%, 05/11/99.......... 33,382,302
41,300,000 The Canadian Wheat Board,
4.79%, 05/25/99.......... 40,832,908
--------------
197,386,395
--------------
FOOD--2.6%
75,000,000 Nestle Capital
Corporation, 4.75%,
3/19/99.................. 74,821,875
--------------
PHARMACEUTICALS--5.8%
14,300,000 Glaxo Wellcome, Inc.,
4.76%, 04/22/99.......... 14,201,680
20,000,000 Glaxo Wellcome, Inc.,
4.76%, 04/28/99.......... 19,846,622
</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
FEBRUARY 28, 1999
(UNAUDITED)
(CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL AMORTIZED
AMOUNT COST
------ ----
<C> <S> <C>
COMMERCIAL PAPER (CONTINUED)
$ 33,300,000 Glaxo Wellcome, PLC,
5.06%, 03/08/99.......... $ 33,267,237
23,800,000 Glaxo Wellcome, PLC,
5.06%, 03/09/99.......... 23,773,238
61,000,000 SmithKline Beecham
Corporation, 4.80%,
03/05/99................. 60,967,467
15,000,000 SmithKline Beecham
Corporation, 4.82%,
03/18/99................. 14,965,858
--------------
167,022,102
--------------
Total Foreign (cost $439,230,372).......... 439,230,372
--------------
Total Commercial Paper (cost
$2,187,988,110)............................ 2,187,988,110
--------------
CORPORATE NOTES--3.1%(A)
- ----------------------
ASSET BACKED/RECEIVABLES--0.1%
612,410 Chase Manhattan Auto Owner
Trust 1998 - C,
Class A1, 5.59%,
07/09/99................. 612,410
--------------
BANKING--2.5%
75,000,000 First Union National Bank,
Bank Note 4.89%,
06/24/99................. 75,000,000
--------------
BEVERAGES--0.5%
15,000,000 PepsiCo, Inc., 4.81%,
08/19/99(c).............. 14,992,070
--------------
Total Corporate Notes (cost $90,604,480)... 90,604,480
--------------
U.S. AGENCY SECURITIES--21.4%(A)
50,000,000 Fannie Mae, 4.69%,
04/09/99................. 49,745,958
50,000,000 Fannie Mae, 4.70%,
05/04/99................. 49,582,222
35,000,000 Fannie Mae, 4.71%,
08/12/99................. 34,249,017
14,745,000 Fannie Mae, 4.78%,
04/02/99................. 14,682,350
50,000,000 Fannie Mae, 4.88%,
03/05/99................. 49,972,889
25,000,000 Federal Home Loan Bank,
4.56%, 09/16/99.......... 24,369,557
12,500,000 Federal Home Loan Bank,
4.59%, 07/13/99.......... 12,286,438
12,500,000 Federal Home Loan Bank,
4.71%, 08/06/99.......... 12,241,604
10,000,000 Federal Home Loan Bank,
4.81%, 04/05/99.......... 9,953,236
40,000,000 Freddie Mac, 4.57%,
03/09/99................. 39,959,378
100,000,000 Freddie Mac, 4.77%,
04/01/99................. 99,589,250
25,000,000 Freddie Mac, 4.88%,
03/05/99................. 24,986,443
19,000,000 Student Loan Marketing
Association, 4.60%,
06/30/99................. 18,706,239
60,000,000 Student Loan Marketing
Association, 4.62%,
06/30/99................. 59,068,300
100,000,000 Student Loan Marketing
Association, 4.63%,
06/30/99................. 98,443,806
21,000,000 Student Loan Marketing
Association, 4.67%,
06/30/99................. 20,670,376
--------------
Total U.S. Agency Securities (cost
$618,507,063).............................. 618,507,063
--------------
Total Investment Portfolio excluding
repurchase agreement (cost
$2,897,099,653)............................ 2,897,099,653
--------------
REPURCHASE AGREEMENT--0.5%(A)
Repurchase Agreement with State Street Bank
and Trust Company, dated February 26, 1999
@ 4.68% to be repurchased at $13,918,426 on
March 1, 1999, collateralized by
$13,500,000 United States Treasury Notes,
6.5% May 31, 2002 (market value $14,197,299
including interest) (cost $13,913,000)..... 13,913,000
--------------
TOTAL INVESTMENTS
(cost $2,911,012,653)(d)100.8%(a)......... 2,911,012,653
OTHER ASSETS AND LIABILITIES, net,
(0.8%)(a).................................. (23,799,219)
--------------
NET ASSETS, (consisting of paid-in-capital
net of accumulated net realized loss of
$267,823) 100.0%. ......................... $2,887,213,434
==============
CLASS A SHARES
- ------------
Net asset value, offering and redemption
price per share, ($2,884,161,757 divided by
2,884,429,581 shares outstanding).......... $1.00
==============
CLASS B SHARES
- ------------
Net asset value, offering and redemption
price per share, ($356,422 divided by
356,422 shares outstanding)................ $1.00
==============
CLASS C SHARES
- ------------
Net asset value, offering and redemption
price per share, ($2,695,255 divided by
2,695,255 shares outstanding).............. $1.00
==============
- ---------------
(a) Percentages are based on net assets.
(b) U.S. dollar denominated.
(c) Floating rate note. Rate adjusts quarterly based on the
three month London Inter Bank Offered Rate less .0019%.
(d) 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 SIX MONTH PERIOD ENDED FEBRUARY 28, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
Investment Income:
Interest.................................................... $70,097,848
Expenses (Notes 1 and 4):
Management fee............................................ $5,954,325
Distribution fee (Class A Shares)......................... 2,008,128
Distribution fee (Class B Shares)......................... 243
Distribution fee (Class C Shares)......................... 1,442
Shareholder servicing fees................................ 1,434,318
Custodian/Fund accounting fees............................ 163,103
State qualification expenses.............................. 110,682
Federal registration fees................................. 100,426
Reports to shareholders................................... 69,531
Professional fees......................................... 26,829
Insurance expense......................................... 8,584
Trustees' fees and expenses............................... 4,934
Other..................................................... 13,321
----------
Total expenses...................................... 9,895,866
-----------
Net investment income....................................... 60,201,982
Realized Gain on Investments
Net realized gain from investment transactions.............. 334
-----------
Net increase in net assets resulting from operations........ $60,202,316
===========
</TABLE>
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FOR THE
SIX MONTH
PERIOD ENDED FOR THE YEAR
FEBRUARY 28, 1999 ENDED
(UNAUDITED) AUGUST 31, 1998
----------------- ---------------
<S> <C> <C>
Increase (decrease) in net assets:
Operations:
Net investment income..................................... $ 60,201,982 $ 109,280,818
Net realized gain on investment transactions.............. 334 682
-------------- --------------
Net increase in net assets resulting from operations...... 60,202,316 109,281,500
Distributions to shareholders from:
Net investment income and net realized gains Class A
Shares, ($.022 and $.049 per share, respectively)....... (60,151,229) (109,250,845)
Net investment income and net realized gains Class B
Shares, ($.022 and $.027* per share, respectively)...... (7,225) (799)
Net investment income and net realized gains Class C
Shares, ($.022 and $.049 per share, respectively)....... (43,528) (29,174)
Increase in net assets from Fund share transactions (Note
2)........................................................ 392,672,857 478,532,212
-------------- --------------
Increase in net assets...................................... 392,673,191 478,532,894
Net assets, beginning of period............................. 2,494,540,243 2,016,007,349
-------------- --------------
Net assets, end of period................................... $2,887,213,434 $2,494,540,243
============== ==============
</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 A SHARES CLASS B SHARES
-------------------------------------------------------------- --------------------------------
FOR THE SIX MONTH FOR THE SIX MONTH
PERIOD ENDED PERIOD ENDED FOR THE
FEBRUARY 28, FOR THE YEARS ENDED AUGUST 31, FEBRUARY 28, PERIOD ENDED
1999 ------------------------------------------ 1999 AUGUST 31,
(UNAUDITED) 1998 1997 1996 1995 1994 (UNAUDITED) 1998++
----------------- ------ ------ ------ ------ ------ ----------------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE,
BEGINNING OF PERIOD.... $ 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)............... .022 .049 .047 .048 .050 .029 .022 .027
LESS DISTRIBUTIONS:
Dividends from net
investment income
and net realized
gains (a)............ (.022) (.049) (.047) (.048) (.050) (.029) (.022) (.027)
------- ------ ------ ------ ------ ------ ------- ------
NET ASSET VALUE, END OF
PERIOD................. $ 1.000 $1.000 $1.000 $1.000 $1.000 $1.000 $ 1.000 $1.000
======= ====== ====== ====== ====== ====== ======= ======
TOTAL RETURN %.......... 2.25(d) 4.99 4.85 4.89 5.00 2.87 2.25(d) 2.70(d)
RATIOS TO AVERAGE DAILY NET
ASSETS (%)/SUPPLEMENTAL DATA:
Operating expenses,
net (b).............. .74(c) .75 .76 .78 .79 .79 .74(c) .75(c)
Net investment income
(b).................. 4.49(c) 4.88 4.74 4.78 5.00 2.87 4.47(c) 4.86(c)
Net assets, end of
period ($ millions).. 2,884 2,492 2,016 1,641 1,294 982 0.36 .21
<CAPTION>
CLASS C SHARES
--------------------------------------------
FOR THE SIX MONTH
PERIOD ENDED FOR THE YEARS ENDED
FEBRUARY 28, AUGUST 31,
1999 ------------------------
(UNAUDITED) 1998 1997 1996+
----------------- ------ ------ ------
<S> <C> <C> <C> <C>
NET ASSET VALUE,
BEGINNING OF PERIOD.... $ 1.000 $1.000 $1.000 $1.000
------- ------ ------ ------
INCOME FROM INVESTMENT
OPERATIONS:
Net investment income
(a)(b)............... .022 .049 .047 .023
LESS DISTRIBUTIONS:
Dividends from net
investment income
and net realized
gains (a)............ (.022) (.049) (.047) (.023)
------- ------ ------ ------
NET ASSET VALUE, END OF
PERIOD................. $ 1.000 $1.000 $1.000 $1.000
======= ====== ====== ======
TOTAL RETURN %.......... 2.25(d) 4.99 4.85 2.34(d)
RATIOS TO AVERAGE DAILY
ASSETS (%)/SUPPLEMENTAL
Operating expenses,
net (b).............. .74(c) .75 .77 .75(c)
Net investment income
(b).................. 4.53(c) 4.87 4.72 4.62(c)
Net assets, end of
period ($ millions).. 2.70 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,
and for the six month period ended February 28, 1999.
(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
(UNAUDITED)
- --------------------------------------------------------------------------------
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.
7
<PAGE> 9
- --------------------------------------------------------------------------------
HERITAGE CASH TRUST -- MONEY MARKET FUND
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
(CONTINUED)
- --------------------------------------------------------------------------------
Note 2: FUND SHARES. At February 28, 1999, there was an unlimited number of
shares of beneficial interest of no par value authorized.
Transactions in Class A, B and C Shares and dollars of the Fund during
the six month period ended February 28, 1999 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 PERIOD ENDED FEBRUARY 28, 1999 (UNAUDITED)
--------------------------------------------------
Shares sold.......................................... 5,740,073,625 488,834 11,480,273
Shares issued on reinvestment of distributions....... 51,084,770 6,516 36,829
Shares redeemed...................................... (5,398,655,535) (350,575) (11,491,880)
-------------- -------- -----------
Net increase....................................... 392,502,860 144,775 25,222
Shares outstanding:
Beginning of period................................ 2,491,926,721 211,647 2,670,033
-------------- -------- -----------
End of period...................................... 2,884,429,581 356,422 2,695,255
============== ======== ===========
</TABLE>
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) (200,657) (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>
Note 3: PURCHASES, SALES AND MATURITIES OF SECURITIES. For the period ended
February 28, 1999, purchases and maturities of short-term investment
securities, excluding repurchase agreements, aggregated $15,351,639,905
and $15,174,735,000, respectively. Purchases and maturities of U.S.
Government obligations aggregated $971,382,290 and $630,000,000,
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 February 28, 1999 was $1,016,033. Pursuant to the current
registration statement, the Manager has 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 ending August 31, 1999. No fees were waived and no expenses were
reimbursed for the six month period ended February 28, 1999.
8
<PAGE> 10
- --------------------------------------------------------------------------------
HERITAGE CASH TRUST -- MONEY MARKET FUND
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
(CONTINUED)
- --------------------------------------------------------------------------------
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
February 28, 1999 was $486,800. In addition, the Manager performs Fund
Accounting services for the Fund and charged $24,127 during the period,
of which $7,790 was payable as of February 28, 1999.
Raymond James & Associates, Inc. (the "Distributor") has advised the
Fund that it received $1,677 in contingent deferred sales charges for
Class B Shares and $385 in contingent deferred sales charges for Class C
Shares for the six month period ended February 28, 1999.
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
February 28, 1999 was $334,496. 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 year ended
August 31, 1998. 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.
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
HIGH YIELD BOND FUND
INTERMEDIATE GOVERNMENT 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 Service 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
High Yield
Intermediate Government
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.
210m 2/99 [Recycled Logo] Printed on recycled paper AR5361smm
