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RNC LIQUID ASSETS FUND, INC.
1995 Annual Report to Shareholders
Dear Shareholder:
We are pleased to present the annual report on the operations of the
RNC Liquid Assets Fund, Inc. for the year ended September 30, 1995. Your Fund
has continued to exhibit a strong performance record. We sincerely appreciate
the confidence you have placed in your Fund's management and extend a special
welcome to all new shareholders.
The average dollar-weighted portfolio maturity of your Fund on
September 30, 1995 was 51 days. Purchases continue to be high quality, highly
liquid investments which allow adjustment to the portfolio's maturity in the
event of a change in the interest rate forecast. Each issue is monitored to
assure that it meets our demanding standards of creditworthiness.
The Fund's portfolio diversification and maturity range will continue
to be adjusted based upon the interest rate forecast under fluctuating market
conditions.
We assure you of our continuing dedication to achieve superior
investment results, and look forward to continued service to you. If you have
any questions concerning your investment, please feel free to contact us.
Sincerely,
DANIEL J. GENTER ERIC M. BANHAZL
President President
RNC Capital Management Co. RNC Liquid Assets Funds, Inc.
<PAGE>
Tait, Weller & Baker
Certified Public Accountants
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
To the Board of Directors and Shareholders of
RNC Liquid Assets Fund, Inc.
We have audited the accompanying statement of assets and liabilities of RNC
Liquid Assets Fund, Inc., including the investment portfolio, as of September
30, 1995, and the related statements of operations for the year then ended, the
statement of changes in net assets for each of the two years in the period then
ended, and the financial highlights for each of the five years in the period
then ended. These financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
September 30, 1995, by correspondence with the custodian. An audit includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of RNC
Liquid Assets Fund, Inc. As of September 30, 1995, and 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 five years in the period then ended, in accordance with generally accepted
accounting principles.
Tait, Weller & Baker
Philadelphia, Pennsylvania
October 27, 1995
<PAGE>
<TABLE>
<CAPTION>
RNC LIQUID ASSETS FUND, INC.
INVESTMENT PORTFOLIO
September 30, 1995
Principal
Amount Value
<S> <C> <C>
Commercial Paper - 79.06%
American Express Corp., 5.66%, 03-12-96 $1,000,000 $1,000,000
Banque Nationale de Paris, 5.68%, 11-14-95 1,200,000 1,191,669
Duff & Phelps Utility Corp., 5.67%, 01-09-96 1,500,000 1,476,375
Dynamic Funding Corp., 5.81%, 10-17-95 1,000,000 997,418
Enterprise Funding Corp., 5.65%, 11-22-95 1,500,000 1,487,758
Fleetwood Credit Corp., 5.77%, 10-26-95 1,000,000 995,993
Ford Motor Corp., 5.75%, 10-30-95 1,000,000 1,000,000
GE Capital Corp, 6.23%, 10-16-95 2,000,000 2,000,000
GMAC Corp., 5.84%, 02-12-96 1,000,000 1,000,000
Industrial Funding Corp., 5.78%, 11-15-95 1,000,000 992,775
John Deere Capital Corp., 5.56%, 01-24-96 1,500,000 1,500,000
Mobil Aust Finance Corp., 5.80%, 10-03-95 995,000 994,679
Orix Norinchukin Corp., 5.73%, 10-20-95 1,500,000 1,495,464
Pacific Dunlop Holdings Inc., 5.63%, 02-29-96 1,509,000 1,473,365
Plantation Pineline Corp., 5.67%, 11-29-95 1,000,000 990,708
Progress Funding Corp., 5.70%, 11-10-95 1,000,000 993,667
Rabobank Nederland Corp., 5.80%, 02-01-96 1,000,000 1,000,000
Receivables Capital Corp, 5.65%, 12-08-95 1,000,000 989,328
Sanwa Business Credit Corp., 5.77%, 10-12-95 1,000,000 998,237
Shinhan Bank, 5.77%, 11-07-95 1,000,000 994,070
Sydney Cap Corp., 5.70%, 12-14-95 1,000,000 988,283
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24,559,789
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Federal Agency Securitites - 6.44%
Student Loan Marketing Association, 5.590%, 2-17-98 2,000,000 2,000,000
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Corporate Notes - 7.08%
Toyota Motor Credit Medium Term Note, 5.439%, 1-12-96 2,200,000 2,199,976
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Overnight Repurchase Agreement - 7.37%
Clarke Repo, 6.125%, 10-02-95
(Collaterized by $2,296,837 U.S. Treasury Note, 4.25%,
due 12/31/95). 2,290,000 2,290,000
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Total Investment Portfolio - 99.95% 31,049,765
Assets in Excess
of Other Liabilities - Net - 0.05% 16,277
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Net Assets - 100.0% $31,066,042
===========
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
RNC LIQUID ASSETS FUND, INC.
STATEMENT OF ASSETS AND LIABILITIES
September 30, 1995
<S> <C>
Investment portfolio (Note1)
(Cost $31,049,765) $31,049,765
Cash 133
Interest receivable 139,244
Prepaid expenses 55,169
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Total Assets 31,244,311
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Liabilities:
Accrued expenses 42,002
Dividends payable 136,267
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Total Liabilities 178,269
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Net Assets* - (equivalent to $1.00 per share based on
31,066,042 shares of capital stock outstanding) $31,066,042
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<FN>
* Net Assets consist entirely of paid in capital in the amount of $31,066,042.
</FN>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
RNC LIQUID ASSETS FUND, INC.
STATEMENT OF OPERATIONS
For the Year Ended September 30, 1995
<S> <C> <C>
Investment Income:
Interest $ 2,214,527
Expenses:
Management fees $ 106,810
Professional fees 64,679
Administration fees 48,001
Registration fees 20,622
Audit fees 13,972
Transfer Agent fees 12,930
Insurance expense 10,685
Directors fees 8,502
Fund Accounting fees 7,162
Custodian fees 6,265
Other expenses 6,010
Printing expense 995
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Total expenses 306,633
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Net investment income 1,907,894
Net Increase in Net Assets Resulting
from Operations $ 1,907,894
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
RNC LIQUID ASSETS FUND, INC.
STATEMENT OF CHANGES IN NET ASSETS
For the Years Ended
September 30,
1995 1994
<S> <C> <C>
Increase in Net Assets from Operations $ 1,907,894 $ 1,154,595
Distributions to Shareholder from Net
Investment Income (1,907,894) (1,154,595)
Capital Share Transactions (net) 12,619,918 14,429,414
Total Increase (Decrease) in Net Assets (12,619,918) 14,429,414
Net Assets
Beginning of year 43,685,960 29,256,546
End of year $ 31,066,042 $ 43,685,960
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
RNC LIQUID ASSETS FUNDS, INC.
CONDENSED FINANCIAL INFORMATION
FINANCIAL HIGHLIGHTS
For the Years Ended September 30,
Per Share Operating
Performance 1995 1994 1993 1992 1991
Net Asset Value
<S> <C> <C> <C> <C> <C>
at beginning of year $1.000 $1.000 $1.000 $1.000 $1.000
Income from investment
operations:
Net investment income 0.050 0.032 0.026 0.038 0.064
Less distributions:
Distributions from net
investment income (0.050) (0.032) (0.026) (0.038) (0.064)
Net Asset Value
at end of year $1.000 $1.000 $1.000 $1.000 $1.000
Total Return 5.10% 3.20% 2.65% 3.83% 6.34%
Ratios/Supplemental Data:
Net Assets,
end of period (000's) $31,066 $43,686 $29,257 $46,563 $66,857
Ratio of expenses to
average net assets 0.8% 0.7% 0.7% 0.8% 0.9%
Ratio of net investment
income to average
net assets 5.0% 3.2% 2.6% 3.9% 6.4%
</TABLE>
<PAGE>
RNC LIQUID ASSETS FUND, INC.
Notes to Financial Statements
September 30, 1995
RNC LIQUID ASSETS FUND, INC.
Notes to Financial Statements (Continued)
September 30, 1995
A:\NOTES.WPD
1. Significant Accounting Policies.
RNC Liquid Assets Fund, Inc. ("the Fund") is registered under the
Investment Company Act of 1940 as a diversified, open-end management company.
The following is a summary of significant accounting policies followed by the
Fund.
Portfolio Valuation. Portfolio securities are valued using the amortized
cost method which approximates market.
Federal Income Tax. It is the Fund's policy to continue to comply with the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute substantially all of its taxable income, including
any net realized gain on investments not offset by loss carryovers, to its
shareholders. Therefore, no Federal income tax provision is required.
Distributions to Shareholders. Distributions to shareholders are declared
daily from the total of net investment income and net realized gains on
investments, if any.
Deferred Costs. Prepaid expenses are being amortized on a straight-line
basis over a twelve month period.
Other. As is customary in the mutual fund industry, securities transactions are
accounted for on the date the securities are purchased or sold. Realized gains
and losses from securities transactions are reported on an identified cost
basis. Interest income is recognized on the accrual basis.
2. Capital Share Transactions.
As of September 30, 1995 there were 500,000,000 shares of $0.01 par value
capital stock authorized. Transactions in capital stock were as follows:
Shares and Dollar Amount
<TABLE>
<CAPTION>
For The Year Ended September 30,
1995 1994
<S> <C> <C>
Shares sold 131,917,129 108,890,802
Shares issued in reinvestment
of distributions 285,525 167,635
107,406,501 109,058,437
Shares redeemed 119,582,736 94,629.023
Net increase/(decrease) (12,176,235) 14,429,414
Amount (Net Asset Value = $1.00) $ (12,176,235) $ 14,429,414
</TABLE>
<PAGE>
3. Investment Advisory Fees and Other Transactions with Affiliates.
The investment advisory fee of $106,810 was paid pursuant to an agreement with
RNC Capital Management Co. (RNC). Under the agreement RNC is responsible for the
management of the Fund's portfolio and also provides personnel, facilities,
equipment and other services necessary to the management of the Fund. The
Agreement provides for monthly fees computed at an annual rate of .41% of the
Fund's average daily net assets. For the year ended September 30, 1995, RNC
voluntarily waived a portion of the fee which amounted to .13% of the Fund's
average daily net assets.
The agreement obligates RNC to reimburse the Fund to the extent that the Fund's
expenses (excluding interest, taxes, brokers fees and commissions, extraordinary
items and distribution expenses) exceed the expense limitations applicable to
the fund imposed by state securities laws or regulations. In addition, from time
to time, RNC may voluntarily reimburse a portion of the Fund's other expenses.
For the year ended September 30, 1995, the Fund's expenses did not exceed such
expense limitations and required no reimbursement by RNC.
Certain officers of the Fund are also officers of the underwriter and
administrator. The Fund paid the administrator $48,000 for the year ended
September 30, 1995.
Midvale Securities Corporation (MSC), an affiliate of RNC, waived all fees,
in its capacity as Shareholder Servicing Agent, for shareholder related
servicing undertaken pursuant to a shareholder-approved plan. The maximum amount
of payment to MSC under this plan is .25%.
