<PAGE>
<PAGE> 1
----------------------------
PLAN INVESTMENT FUND, INC.
Annual Report
December 31, 1994
ADMINISTRATOR:
[LOGO]
<PAGE>
<PAGE> 2
- - --------------------------------------------------------------------------------
PLAN INVESTMENT FUND, INC.
PRESIDENT'S LETTER
- - --------------------------------------------------------------------------------
February 10, 1995
Fellow Investors:
On behalf of the Board of Trustees, I am pleased to submit the 1994 Annual
Report for Plan Investment Fund. This past year marked a dramatic change in
the fixed income markets as the Federal Reserve Board ended almost five years
of accommodative monetary policy and aggressively raised short term interest
rates. This change caught many investors by surprise, especially those who
found that the final maturity of a security is not necessarily a good indication
of its price volatility. Many of the stellar performers of 1993 achieved their
results by owning securities that leveraged their exposure to changes in the
level of interest rates. This leveraging strategy proved disastrous in 1994.
For too many investors, the best part of 1994 was when it was finally over.
In a period when most fixed income securities produced negative rates of return,
both Plan Investment Fund portfolios produced strong positive results. The
Money Market Portfolio, which we believe is appropriate for day to day operating
funds, had a return of 4.21% for the year. The Short-Term Portfolio, which we
believe is appropriate for investors who have a longer investment horizon but
still want to minimize price fluctuations, had a total return of 3.46% for the
year. The 1.0% price decline of the Short-Term Portfolio was more than offset
by its interest earnings during this period.
This past year was truly a test of how well we have followed the high quality,
low risk philosophy that we have presented to our investors over the years. If
we had compromised our standards and stretched for yield, you would have seen
the consequences in 1994. We believe that our results have demonstrated our
commitment to providing a consistent investment vehicle that offers no
surprises.
We are obviously pleased with the achievements of Plan Investment Fund in 1994
and look forward to serving your investment needs in the coming year.
Sincerely,
/S/ PHIL
----
Philip A. Goss
President and Chief Executive Officer
<PAGE>
<PAGE> 3
- - --------------------------------------------------------------------------------
INVESTMENT PERFORMANCE
- - --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ANNUALIZED TOTAL RETURN
----------------------------------------
PERIODS ENDED THREE ONE FROM 3/87
DECEMBER 31, 1994 MONTHS YEAR INCEPTION
- - ----------------- ------ ---- ---------
<S> <C> <C> <C>
PIF MONEY MARKET PORTFOLIO 5.30% 4.21% 6.12%
Donoghues Inst. Money Market Avg. 5.01 3.96 5.93
Repurchase Agreements 5.34 4.29 6.09
PIF SHORT-TERM PORTFOLIO 4.61% 3.46% 6.20%
Six Month U.S. Treasury Bill Index 5.47 4.35 5.97
1-3 Year U.S. Treasury Note Index 0.00 0.57 7.02
<FN>
As of December 31, 1994 the Money Market Portfolio seven day average yield was
5.60% and the Short-Term Portfolio thirty day average yield was 5.72% based on
SEC prescribed methodology.
</TABLE>
- - --------------------------------------------------------------------------------
FOURTH QUARTER 1994 PORTFOLIO CHARACTERISTICS
- - --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MONEY MARKET PORTFOLIO
--------------------------------------------------------
AVERAGE CLOSING AVERAGE AVERAGE
YIELD PRICE MATURITY QUALITY
------- ------- -------- -------
<S> <C> <C> <C> <C>
OCTOBER 4.83% $1.00 32 Days A1+
NOVEMBER 5.09 1.00 35 Days A1+
DECEMBER 5.50 1.00 39 Days A1+
</TABLE>
<TABLE>
<CAPTION>
SHORT-TERM PORTFOLIO
--------------------------------------------------------
AVERAGE CLOSING AVERAGE AVERAGE
YIELD PRICE MATURITY QUALITY
------- ------- -------- -------
<S> <C> <C> <C> <C>
OCTOBER 5.04% $9.95 5.3 Months AAA
NOVEMBER 5.21 9.92 5.3 Months AAA
DECEMBER 5.58 9.93 4.2 Months AA+
</TABLE>
<PAGE>
<PAGE> 4
- - --------------------------------------------------------------------------------
REPORT FROM THE MONEY MARKET PORTFOLIO ADVISOR
- - --------------------------------------------------------------------------------
The end of the fourth quarter closed the books on a very tumultuous year for
fixed income investors. The year's best investments were those with the
shortest maturities. Bond buyers actually saw their principal shrink in 1994.
The cause?...a cornucopia of surprises that included stronger than expected
economic growth, benign inflation, a 250 basis point increase in short-term
interest rates, and derivatives! It all began last February when the Federal
Reserve took "pre-emptive" action against inflation by raising interest rates
25 basis points. This seemingly mild step to slow economic growth to a
sustainable 2.5-3.0% pace led to five more monetary tightenings in 1994 and a
trail of soured fixed income investments. Those affected included major
corporations, banks, security lenders, mutual funds, and municipalities; many
of whom misjudged the extent of the change in interest rates and/or used risky
investment strategies for speculative purposes.
Fourth quarter economic activity appears strong, on the heels of the upward
revised figure of 4.0% for third quarter Gross Domestic Product ("GDP"). Retail
sales were up 1.2% in November, and 8.7% on a year-over-year basis. Capacity
utilization rose to 84.7%, the highest reading since April 1989. Auto output is
running strong and is estimated to add about 4.0% to GDP in the fourth quarter.
Housing starts also were strong during November's unseasonably warm weather,
rising 6.9%. Finally, December's employment figures showed continued strength
with a decline in the unemployment rate to 5.4%
All these signs of strength suggest that the Federal Reserve will continue to
push interest rates higher. Their inaction during December was because not
enough time had passed since the last increase in November for them to see the
effects on the economy, not because of any lessening in their resolve to fight
inflation. The Federal Open Market Committee ("FOMC") decision to raise short
term rates again in January, 1995 was widely anticipated at year-end.
The Money Market Portfolio maintained a defensive investment strategy for most
of the year, given the uncertainty of the frequency, timing and severity of rate
increases. Investments were frequently targeted to mature around FOMC meeting
dates, in order to maximize the reinvestment opportunity. The Portfolio also
kept a generous amount of short-term and overnight investments to meet possible
liquidity demands, especially at year-end. The Fund's variable rate note
position, currently averaging 30% of the portfolio, continues to help keep the
yield responsive to rising interest rates.
The Money Market Portfolio also concentrated on the highest quality investments.
At year-end, for example, 70% of the portfolio holdings were government
obligations, A-1+ rated commercial paper and repurchase agreements
collateralized by government obligations. The Fund remains short, with an
average weighted maturity typically in the mid-20 day range; a position that
should serve it well if the Federal Reserve tightens monetary policy further.
For the year, the Money Market Portfolio produced a return of 4.21%, versus the
3.96% average for Institutions-Only Funds in the IBC/Donoghue Money Market Fund
universe.
Thomas H. Nevin, President and Chief Investment Officer
PNC Institutional Management Corporation
<PAGE>
<PAGE> 5
- - --------------------------------------------------------------------------------
REPORT FROM THE SHORT-TERM PORTFOLIO ADVISOR
- - --------------------------------------------------------------------------------
Few bond investors will regret that 1994 has come to an end. The dramatic rise
in interest rates caused the worst overall bond market performance since 1927.
Investors in the longest maturity securities fared the worst. The 30 year
Treasury Bond lost 11.8% for the year, 10 year Treasuries lost 7.9% and 5 year
Treasuries declined 4.1%. The average long term U.S. Treasury mutual fund lost
6.3% while the average short term U.S. Treasury mutual fund lost 0.9%. There
were many other pitfalls that caused negative performance in many portfolios and
mutual funds which we avoided thanks to our low risk, short maturity investment
approach.
The good news is that by meticulously sticking to our investment philosophy of
reacting to the trend in interest rates and selecting carefully among
appropriate sectors and high quality issues, we were able to produce net returns
of 3.5%. That was 90 basis points in excess of the 1 year Treasury Bill, and
competitive to the returns on the best performing fixed income issues in 1994,
those in the very short money market area. We continuously shortened the
average portfolio maturity throughout the year to take advantage of higher
reinvestment rates. We maintained significant positions of various short term
corporate and agency issues to take advantage of the increasing premiums over
Treasuries demanded by the market place.
The portfolio's credit quality remained high as all securities were rated A or
higher and the average portfolio quality rating was at least AA+. The major
changes throughout the year were decreases in longer maturity U.S. Treasury,
asset backed and corporate securities in favor of shorter maturity government
agency issues, corporate commercial paper and floating rate notes which reset
frequently off of various short term interest benchmarks, such as Treasury
Bills and Libor.
Looking to 1995 we believe the vigilance of the Federal Reserve Board has kept
inflation in check, although we observe that most economists and market
participants believe there is a good chance that there will be additional
increases in short term rates. There are many fundamental issues, such as
emerging market liquidity needs, the strength of the U.S. dollar, a strong
economy and full employment which will potentially shape the actions of our
government officials. We will be very cautious in our investment strategies as
we wait for clear trends to unfold.
[EDGAR REFERENCE - PERFORMANCE LINE CHART PIF SHORT-TERM PORTFOLIO AND SIX
MONTH TREASURY BILL]
<TABLE>
<CAPTION>
Annualized Total Return
-----------------------
1 Year 5 Years Inception
------ ------- ---------
<S> <C> <C> <C>
Short-Term Portfolio 3.46% 5.55% 6.20%
</TABLE>
Theresa A. Havell
Director, Fixed Income Group
Neuberger & Berman
<PAGE>
<PAGE> 6
Statement of Net Assets
-----------------------
MONEY MARKET PORTFOLIO
----------------------
December 31, 1994
-----------------
<TABLE>
<CAPTION>
PERCENTAGE
OF PAR
NET ASSETS (000) VALUE
---------- ----- ---------
<S> <C> <C>
- - ------------------------------------------------------------------------------
GOVERNMENT AGENCY OBLIGATIONS 6.6%
- - ------------------------------------------------------------------------------
Federal National Mortgage Association
5.40% (3/09/95) $ 5,000 $ 4,949,750
Student Loan Marketing Association
Variable Rate Note, 5.87% (1/03/95) 25,000 25,000,000
----------
TOTAL GOVERNMENT AGENCY OBLIGATIONS 29,949,750
(Cost $29,949,750) ----------
- - ------------------------------------------------------------------------------
COMMERCIAL PAPER 50.4%
- - ------------------------------------------------------------------------------
AGRICULTURAL SERVICES.............. 0.7%
Golden Peanut Company
5.57% (2/22/95) 3,000 2,975,863
----------
BANKS.............................. 2.0%
Norwest Corp.
5.77% (2/21/95) 9,200 9,124,798
----------
CANNED, FROZEN & PRESERVED FRUIT... 1.1%
Sara Lee Corp.
5.93% (3/01/95) 5,000 4,951,407
----------
CHEMICALS & ALLIED PRODUCTS........ 2.2%
Great Lakes Chemical Corp.
5.91% (1/27/95) 10,000 9,957,317
----------
COMPUTER & OFFICE EQUIPMENT........ 1.1%
Hewlett-Packard Finance
5.40% (3/30/95) 5,000 4,934,000
----------
FINANCE LESSORS.................... 6.6%
General Electric Capital Corp.
5.10%-6.45% (2/08/95-4/13/95) 30,000 29,605,059
----------
FIRE MARINE & CASUALTY INSURANCE... 1.1%
A.I. Credit Corp.
5.08% (2/14/95) 5,000 4,968,956
----------
</TABLE>
<PAGE>
<PAGE> 7
Statement of Net Assets
-----------------------
MONEY MARKET PORTFOLIO
----------------------
<TABLE>
<CAPTION>
PERCENTAGE
OF PAR
NET ASSETS (000) VALUE
---------- ----- ---------
<S> <C> <C>
GRAIN MILLS PRODUCTS............... 2.6%
General Mills, Inc.
5.57% (4/04/95) $12,000 $11,827,330
----------
LIFE INSURANCE..................... 1.1%
MetLife Funding, Inc.
5.60% (1/09/95) 5,000 4,993,778
----------
MALT BEVERAGES..................... 1.1%
Anheuser-Busch, Inc.
5.85% (3/24/95) 5,000 4,933,375
----------
PERSONAL CREDIT INSTITUTIONS....... 7.3%
American General Finance Corp.
6.00% (2/28/95) 10,000 9,903,333
Avco Financial Services Inc.
5.90% (1/25/95-1/26/95) 13,100 13,047,916
Ford Motor Credit Corp.
5.42% (1/12/95) 10,000 9,983,439
----------
32,934,688
----------
PETROLEUM REFINING................. 5.5%
Koch Industries, Inc.
6.00% (1/03/95) 25,000 24,991,667
----------
PIPE LINES......................... 1.1%
Colonial Pipeline Co.
5.60% (2/07/95) 5,000 4,971,222
----------
SERVICES-ACCOUNTING & MANAGEMENT... 5.5%
Dun & Bradstreet Corporation
5.85%-6.33% (3/21/95-4/18/95) 25,000 24,622,442
----------
SERVICES-EQUIPMENT RENTING & LEASING 1.1%
International Lease Finance Corp.
5.72% (2/08/95) 5,000 4,969,811
----------
SHORT-TERM BUSINESS CREDIT INSTITUTIONS 0.9%
Paccar Financial Corp.
5.70% (2/09/95) 4,200 4,174,065
----------
</TABLE>
<PAGE>
<PAGE> 8
Statement of Net Assets
-----------------------
MONEY MARKET PORTFOLIO
----------------------
<TABLE>
<CAPTION>
PERCENTAGE
OF PAR
NET ASSETS (000) VALUE
---------- ----- ---------
<S> <C> <C>
TELEPHONE COMMUNICATIONS........... 9.4%
Ameritech Corp.
5.64% (3/30/95) $ 5,000 $ 4,931,066
BellSouth Capital Funding Corp.
4.95%-5.07% (1/30/95-2/14/95) 15,000 14,918,096
U.S. West Communications, Inc.
5.85% (2/02/95) 22,500 22,383,000
----------
42,232,162
----------
TOTAL COMMERCIAL PAPER
(Cost $227,167,940) 227,167,940
-----------
- - ------------------------------------------------------------------------------
VARIABLE RATE OBLIGATIONS 32.3%
- - ------------------------------------------------------------------------------
BANKS.............................. 9.3%
Bank of New York (Delaware)
5.64% (1/03/95) 17,000 16,996,531
Comerica Bank (Detroit)
5.82% (1/03/95) 25,000 24,987,621
----------
41,984,152
----------
FINANCE SERVICES................... 2.2%
AT&T Capital Corp.
6.00% (1/26/95) 10,000 10,000,634
----------
SECURITY BROKERS & DEALERS......... 20.8%
Bear Stearns & Co. Inc.
6.0475% (1/25/95) 24,000 24,000,000
Goldman Sachs Group, L.P.
5.9375% (2/10/95) 25,000 25,000,000
J.P. Morgan Securities, Inc.
6.175% (1/10/95) 25,000 25,000,000
Merrill Lynch & Co. Inc.
5.64% (1/03/95) 10,000 9,998,880
Morgan Stanley Group Inc.
6.225% (1/18/95) 10,000 10,000,000
----------
93,998,880
----------
TOTAL VARIABLE RATE OBLIGATIONS
(Cost $145,983,666) 145,983,666
-----------
</TABLE>
<PAGE>
<PAGE> 9
Statement of Net Assets
-----------------------
MONEY MARKET PORTFOLIO
----------------------
<TABLE>
<CAPTION>
PERCENTAGE
OF PAR
NET ASSETS (000) VALUE
---------- ----- ---------
<S> <C> <C>
- - ------------------------------------------------------------------------------
REPURCHASE AGREEMENTS 11.3%
- - ------------------------------------------------------------------------------
BT Securities Corp.
3.00% (1/03/95)
(Collateralized by $6,570,000
U.S. Treasury Note, 5.375%,
due 5/31/98; market value
$6,122,774) $ 6,000 $ 6,000,000
Lehman Government Securities Inc.
6.25% (1/03/95)
(Collateralized by $49,761,000
U.S. Government Agency Obligations,
3.79% to 7.85%, due 1/25/95 to
12/15/43; market value $46,538,381) 45,189 45,189,000
----------
TOTAL REPURCHASE AGREEMENTS
(Cost $51,189,000) 51,189,000
----------
TOTAL INVESTMENTS IN SECURITIES.... 100.6% 454,290,356
(Cost $454,290,356*)
LIABILITIES IN EXCESS OF OTHER ASSETS (0.6%) ( 2,923,722)
------ -----------
NET ASSETS (Applicable to 451,366,634
PCs outstanding) 100.0% $451,366,634
====== ===========
NET ASSET VALUE, offering and
redemption price per PC
($451,366,634 / 451,366,634 PCs) $1.00
====
<FN>
* Aggregate cost for Federal tax purposes.
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<PAGE> 10
Statement of Net Assets
-----------------------
SHORT-TERM PORTFOLIO
--------------------
December 31, 1994
-----------------
<TABLE>
<CAPTION>
PERCENTAGE
OF PAR
NET ASSETS (000) VALUE
---------- ----- ---------
<S> <C> <C>
- - ------------------------------------------------------------------------------
U.S. TREASURY OBLIGATIONS 7.6%
- - ------------------------------------------------------------------------------
U.S. Treasury Bill
6.655% (12/14/95) $4,000 $ 3,739,400
----------
U.S. Treasury Note
6.00% (6/30/96) 4,200 4,109,448
----------
TOTAL U.S. TREASURY OBLIGATIONS
(Cost $7,947,703) 7,848,848
----------
- - ------------------------------------------------------------------------------
GOVERNMENT AGENCY OBLIGATIONS 19.0%
- - ------------------------------------------------------------------------------
Federal Farm Credit Bank
Discount Note
5.74% (1/09/95) 60 59,923
----------
Federal Home Loan Bank
Discount Note
5.44% (4/12/95) 2,000 1,964,380
----------
Federal Home Loan Mortgage Corporation
Collateralized Mortgage Obligations
5.475%-6.50% (1/15/95-7/31/95) 2,080 2,071,008
Discount Note
5.88% (4/04/95) 745 733,043
----------
2,804,051
----------
Federal National Mortgage Association
Discount Notes
5.32%-6.01% (1/20/95-5/31/95) 9,625 9,374,210
----------
Student Loan Marketing Association
Variable Rate Note
5.48% (6/30/95) 4,000 3,980,640
----------
U.S. Department of Veterans Affairs
Vendee Mortgage Trust 1992-2
6.50% (2/01/96) 1,479 1,459,682
----------
TOTAL GOVERNMENT AGENCY OBLIGATIONS
(Cost $19,735,258) 19,642,886
----------
</TABLE>
<PAGE>
<PAGE> 11
Statement of Net Assets
-----------------------
SHORT-TERM PORTFOLIO
--------------------
<TABLE>
<CAPTION>
PERCENTAGE
OF PAR
NET ASSETS (000) VALUE
---------- ----- ---------
<S> <C> <C>
- - -----------------------------------------------------------------------------
ASSET BACKED SECURITIES 6.7%
- - ------------------------------------------------------------------------------
CARAT Corp. Grantor Trust
Series 1993-M, 3.65% (1/15/95) $ 363 $ 362,775
Chase Manhattan Grantor Trust
Series 1991-A, 6.90% (1/30/95) 201 200,257
Ford Credit Grantor Trust
Series 1991-B, 6.50% (5/31/95) 205 203,902
General Motors Acceptance Corp. Grantor Trust
Series 1992-A, 5.05% (1/15/95) 45 44,656
Midlantic Grantor Trust
Series 1992-1, 4.30% (5/31/95) 1,697 1,673,562
Nissan Corp. Grantor Trust
Series 1992-B, 4.30% (8/30/95) 1,147 1,127,902
USAA Auto Loan Grantor Trust
Series 1994-1, 5.00% (1/01/96) 3,380 3,285,123
----------
TOTAL ASSET BACKED SECURITIES
(Cost $7,034,709) 6,898,177
-----------
- - ------------------------------------------------------------------------------
COMMERCIAL PAPER 33.8%
- - ------------------------------------------------------------------------------
AEROSPACE.......................... 3.5%
Raytheon Co.
5.97% (01/06/95) 3,630 3,626,990
----------
ELECTRIC POWER..................... 1.8%
Potomac Electric Power Co.
5.90% (1/11/95) 1,885 1,881,911
----------
FIRE MARINE & CASUALTY INSURANCE... 4.8%
USAA Capital Corp.
6.10% (2/28/95) 5,000 4,950,458
----------
INSURANCE.......................... 0.8%
Aon Corp.
6.07% (2/06/95) 825 819,992
----------
</TABLE>
<PAGE>
<PAGE> 12
Statement of Net Assets
-----------------------
SHORT-TERM PORTFOLIO
--------------------
<TABLE>
<CAPTION>
PERCENTAGE
OF PAR
NET ASSETS (000) VALUE
---------- ----- ---------
<S> <C> <C>
LIFE INSURANCE..................... 3.4%
MetLife Funding, Inc.
6.05% (2/10/95) $1,700 $ 1,688,572
Prudential Funding Co., Inc.
5.94% (5/16/95) 1,835 1,790,611
----------
3,479,183
----------
OFFICE EQUIPMENT................... 1.0%
Pitney Bowes Inc.
5.40% (1/13/95) 1,030 1,028,059
----------
SECURITY BROKERS AND DEALERS....... 13.3%
Goldman, Sachs & Co.
6.08% (2/10/95) 5,000 4,966,367
Merrill Lynch & Co. Inc.
5.45% (1/19/95) 3,850 3,839,018
Morgan J.P. & Co., Inc.
6.05% (2/09/95) 5,000 4,967,229
----------
13,772,614
----------
SHORT-TERM BUSINESS CREDIT INSTITUTIONS 2.3%
Asset Securitization Cooperative Corp.
6.12% (2/15/95) 2,350 2,331,640
----------
SOAPS AND DETERGENTS............... 1.1%
Procter & Gamble Co.
5.42% (1/17/95) 1,100 1,097,190
----------
UTILITIES-GAS...................... 1.8%
Wisconsin Gas Co.
5.82% (2/22/95) 1,933 1,916,247
----------
TOTAL COMMERCIAL PAPER
(Cost $34,909,679) 34,904,284
----------
- - ------------------------------------------------------------------------------
VARIABLE RATE OBLIGATIONS 31.0%
- - ------------------------------------------------------------------------------
BANKS.............................. 7.7%
FCC National Bank
6.67% (1/03/95) 8,000 8,000,000
----------
FINANCE............................ 3.5%
Dean Witter, Discover & Companies
5.505% (1/16/95) 3,600 3,610,908
----------
</TABLE>
<PAGE>
<PAGE> 13
Statement of Net Assets
-----------------------
SHORT-TERM PORTFOLIO
--------------------
<TABLE>
<CAPTION>
PERCENTAGE
OF PAR
NET ASSETS (000) VALUE
---------- ----- -------
<S> <C> <C>
PERSONAL CREDIT INSTITUTIONS....... 12.6%
Ford Motor Credit Corp.
6.87% (1/03/95) $2,000 $ 1,998,600
Ford Motor Credit Corp.
5.9375% (2/06/95) 4,000 4,015,840
Toyota Motor Credit Corp.
6.67% (1/03/95) 7,000 7,010,360
----------
13,024,800
----------
SECURITY BROKERS & DEALERS......... 7.2%
Morgan Stanley Group Inc.
5.525% (3/19/95) 7,400 7,403,774
----------
TOTAL VARIABLE RATE OBLIGATIONS
(Cost $31,999,679) 32,039,482
----------
- - ------------------------------------------------------------------------------
MEDIUM TERM NOTES 1.8%
- - ------------------------------------------------------------------------------
FINANCE.............................
Dean Witter, Discover and Companies
6.00% (3/01/98)
(Cost $1,996,018) 2,000 1,860,000
----------
TOTAL INVESTMENTS IN SECURITIES.... 99.9% 103,193,677
(Cost $103,623,046*)
OTHER ASSETS IN EXCESS OF LIABILITIES 0.1% 46,023
----- -----------
NET ASSETS (Applicable to 10,394,368
PCs outstanding) 100.0% $103,239,700
====== ===========
NET ASSET VALUE, offering and redemption
price per PC ($103,239,700 / 10,394,368 PCs) $9.93
====
<FN>
* Aggregate cost for Federal tax purposes.
The Aggregate gross unrealized appreciation
or depreciation for all securities is as
follows: excess of value over tax cost
$41,027; excess of tax cost over value
$470,396.
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<PAGE> 14
Statements of Operations
------------------------
Year Ended December 31, 1994
----------------------------
<TABLE>
<CAPTION>
Money Market Short-Term
Portfolio Portfolio
------------ ----------
<S> <C> <C>
INTEREST INCOME $23,252,120 $7,081,179
---------- ---------
EXPENSES
Investment advisory fee 905,193 331,334
Administration fee 263,727 77,111
Custodian 60,937 17,537
Transfer agent 34,999 3,000
Professional Services 34,354 9,465
Insurance 29,532 8,664
Audit 27,270 7,982
Legal 16,499 6,070
Trustee expenses 11,596 3,402
Printing 5,412 1,587
Service Agent 0 100,000
Miscellaneous 1,705 227
Fees waived (14,645) (103,710)
---------- ---------
Total expenses 1,376,579 462,669
---------- ---------
NET INVESTMENT INCOME 21,875,541 6,618,510
NET REALIZED LOSS ON SECURITIES SOLD 0 (907,947)
UNREALIZED DEPRECIATION OF SECURITIES 0 (701,778)
---------- ---------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS $21,875,541 $5,008,785
========== =========
<FN>
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<PAGE> 15
Statements of Changes in Net Assets
-----------------------------------
MONEY MARKET PORTFOLIO
----------------------
<TABLE>
<CAPTION>
Year Ended Year Ended
December 31, 1994 December 31, 1993
----------------- -----------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income $ 21,875,541 $ 17,266,013
Net realized gain (loss)
on securities sold 0 6,887
---------- ----------
Net increase in net assets
resulting from operations 21,875,541 17,272,900
---------- ----------
DIVIDENDS TO PARTICIPATION CERTIFICATE HOLDERS:
From net investment income
$.041 and $.030 per PC (21,875,541) (17,266,013)
---------- ----------
CAPITAL TRANSACTIONS:
Proceeds from sale of 6,086,561,540
and 5,227,332,343 PCs 6,086,561,540 5,227,332,343
Value of 11,028,155 and 9,650,513 PCs
issued in reinvestment of dividends 11,028,155 9,650,513
Cost of 6,121,061,465 and 5,152,732,191
PCs repurchased (6,121,061,465) (5,152,732,191)
------------- -------------
Increase (decrease) in net assets derived
from capital transactions (23,471,770) 84,250,665
---------- ----------
Total increase (decrease) in net assets (23,471,770) 84,257,552
NET ASSETS:
Beginning of period 474,838,404 390,580,852
End of period $451,366,634 $474,838,404
=========== ===========
<FN>
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<PAGE> 16
Statements of Changes in Net Assets
-----------------------------------
SHORT-TERM PORTFOLIO
--------------------
<TABLE>
<CAPTION>
Year Ended Year Ended
December 31, 1994 December 31, 1993
----------------- -----------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income $ 6,618,510 $ 8,055,994
Net realized gain (loss)
on securities sold (907,947) 204,255
Unrealized appreciation (depreciation)
of securities (701,778) (180,624)
--------- ---------
Net increase in net assets
resulting from operations 5,008,785 8,079,625
--------- ---------
DIVIDENDS TO PARTICIPATION CERTIFICATE HOLDERS:
From net investment income
$.440 and $.377 per PC (6,618,510) (8,055,994)
From net realized gains
$.000 and $.011 per PC 0 (204,255)
--------- ---------
Total dividends (6,618,510) (8,260,249)
CAPITAL TRANSACTIONS:
Proceeds from sale of 9,713,036
and 17,732,805 PCs 96,971,954 178,402,832
Value of 491,088 and 592,611 PCs
issued in reinvestment of
dividends 4,901,395 5,961,518
Cost of 18,429,870 and 19,175,607
PCs repurchased (183,832,374) (192,954,480)
----------- -----------
Increase (decrease) in net assets derived
from capital transactions (81,959,025) (8,590,130)
---------- ---------
Total increase (decrease) in net assets (83,568,750) (8,770,754)
---------- ---------
NET ASSETS:
Beginning of period 186,808,450 195,579,204
----------- -----------
End of period $103,239,700 $186,808,450
=========== ===========
<FN>
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<PAGE> 17
FINANCIAL HIGHLIGHTS
MONEY MARKET PORTFOLIO
----------------------
<TABLE>
<CAPTION>
For a Participation Certificate (PC) Outstanding Throughout the Period
Year Year Year Year Year
Ended Ended Ended Ended Ended
12/31/94 12/31/93 12/31/92 12/31/91 12/31/90
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $1.00 $1.00 $1.00 $1.00 $1.00
---- ---- ---- ---- ----
Income From Investment Operations:
- - ---------------------------------
Net Investment Income .041 .030 .037 .060 .080
Net Realized Gain (Loss) on Investments 0 0 0 0 0
---- ---- ---- ---- ----
Total From Investment Operations .041 .030 .037 .060 .080
---- ---- ---- ---- ----
Less Distributions:
- - ------------------
Dividends to PC holders from
Net Investment Income (.041) (.030) (.037) (.060) (.080)
Distributions to PC holders from
Net Capital Gains 0 0 0 0 0
---- ---- ---- ---- ----
Total Distributions (.041) (.030) (.037) (.060) (.080)
---- ---- ---- ---- ----
Net Asset Value, End of Period $1.00 $1.00 $1.00 $1.00 $1.00
==== ==== ==== ==== ====
Total Return 4.21% 3.07% 3.73% 6.16% 8.29%
Ratios/Supplemental Data:
- - ------------------------
Net Assets, End of Period (000) $451,367 $474,838 $390,581 $642,583 $460,402
Ratio of Expenses to Average
Net Assets(1) .26% .24% .23% .25% .28%
Ratio of Net Investment Income
to Average Net Assets 4.15% 3.02% 3.68% 5.97% 8.02%
<FN>
- - ----------------------------
(1) Without the waiver of advisory and administration fees (see note C), the ratio of expenses to
average daily net assets would have been .24% for the fiscal period ended December 31, 1992.
</TABLE>
<PAGE>
<PAGE> 18
FINANCIAL HIGHLIGHTS
SHORT-TERM PORTFOLIO
--------------------
<TABLE>
<CAPTION>
For a Participation Certificate (PC) Outstanding Throughout the Period
Year Year Year Year Year
Ended Ended Ended Ended Ended
12/31/94 12/31/93 12/31/92 12/31/91 12/31/90
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $10.03 $10.05 $10.09 $9.96 $9.91
----- ----- ----- ---- ----
Income From Investment Operations:
- - ---------------------------------
Net Investment Income .440 .377 .443 .637 .778
Net Realized and Unrealized
Gain (Loss) on Investments (.100) (.009) (.034) .130 .050
---- ---- ---- ---- ----
Total From Investment Operations .340 .368 .409 .767 .828
---- ---- ---- ---- ----
Less Distributions:
- - ------------------
Dividends to PC holders from
Net Investment Income (.440) (.377) (.443) (.637) (.778)
Distributions to PC holders from
Net Capital Gains 0 (.011) (.006) 0 0
---- ---- ---- ---- ----
Total Distributions (.440) (.388) (.449) (.637) (.778)
---- ---- ---- ---- ----
Net Asset Value, End of Period $9.93 $10.03 $10.05 $10.09 $9.96
==== ===== ===== ===== ====
Total Return 3.46% 3.72% 4.13% 7.95% 8.69%
Ratios/Supplemental Data:
- - ------------------------
Net Assets, End of Period (000) $103,240 $186,808 $195,579 $94,050 $24,828
Ratio of Expenses to Average
Net Assets(1) .30% .30% .30% .30% .30%
Ratio of Net Investment Income
to Average Net Assets 4.29% 3.74% 4.29% 6.22% 7.89%
Portfolio Turnover Rate(2) 47.6% 34.1% 37.6% 63.8% 100.2%
<FN>
- - ----------------------------
(1) Without the waiver of advisory, service agent and administration fees (see note C), the ratios
of expenses to average daily net assets would have been .37%, .32%, .37%, .56% and .85% respectively,
for the fiscal periods ended December 31, 1994, 1993, 1992, 1991 and 1990.
(2) Excludes security purchases with a maturity of less than one year.
</TABLE>
<PAGE>
<PAGE> 19
Notes to Financial Statements
A. Plan Investment Fund, Inc. (the "Fund") is registered under the Investment
Company Act of 1940, as amended, as a diversified open-end regulated
investment company. The Fund consists of two separate portfolios, the Money
Market Portfolio and the Short-Term Portfolio (the "Portfolio(s)"). The Fund
is authorized to issue five billion Participation Certificates ("PCs"), par
value $.001 per PC. The Fund presently offers two classes of PCs as follows:
the Money Market Portfolio - two billion PCs authorized and the Short-Term
Portfolio - one billion PCs authorized.
B. Significant accounting policies relating to the Fund are as follows:
Security Valuation - Money Market Portfolio: Securities are valued under the
amortized cost method, which approximates current market value. Under this
method, securities are valued at cost when purchased and thereafter a
constant proportionate amortization of any discount or premium is recorded
until maturity or sale of the security.
Security Valuation - Short-Term Portfolio: Securities for which market
quotations are readily available (other than debt securities with remaining
maturities of 60 days or less) are valued at the most recent quoted bid
price provided by investment dealers. Debt securities with remaining
maturities of 60 days or less are valued on an amortized cost basis (unless
the Board determines that such basis does not represent fair value at that
time).
Securities Transactions and Investment Income - Securities transactions are
recorded on the trade date. Realized gains and losses on investments sold
are recorded on the identified cost basis. Interest income is recorded on
the accrual basis.
Dividends to Participation Certificate Holders - Dividends of net investment
income of both Portfolios are declared daily and paid monthly. Dividends
payable are recorded on the dividend record date. The Short-Term Portfolio
will, subject to the use of offsetting capital loss carry-forwards,
distribute net realized short- and long-term capital gains, if any, once each
year.
Federal Income Taxes - No provision is made for federal taxes as it is each
Portfolio's intention to continue to qualify as a regulated investment
company and to make the requisite distributions to Participation Certificate
Holders which will be sufficient to relieve each Portfolio from all, or
substantially all, federal income and excise taxes. At December 31, 1994 the
Short-Term Portfolio had capital loss carry-forwards amounting to $907,947
that expire in 2002. These loss carry-forwards are available to offset
possible future capital gains of the Short-Term Portfolio.
Repurchase Agreements - Each Portfolio may agree to purchase money market
instruments from financial institutions such as banks and broker-dealers
subject to the seller's agreement to repurchase them at an agreed upon date
and price ("repurchase agreements"). The seller under a repurchase agreement
is required on a daily basis to maintain the value of the securities subject
to the agreement at not less than the repurchase price. The agreement is
conditioned upon the collateral being deposited under the Federal Reserve
book entry system.
<PAGE>
<PAGE> 20
Notes to Financial Statements
-----------------------------
Estimated Maturities - The maturity of collateralized mortgage obligations
and other asset backed securities may vary due to prepayments of principal.
The maturity dates for these securities are estimates based on historic
prepayment factors.
Variable Rate Obligations - For variable rate obligations, the interest
rate presented is as of December 31, 1994 and the maturity shown is the
date of the next interest readjustment.
C. The Fund has entered into agreements for advisory, administrative, service
agent, custodian and transfer agent services as follows:
Money Market Portfolio - PNC Institutional Management Corporation ("PIMC"),
a wholly owned subsidiary of PNC Bank, National Association ("PNC Bank"),
serves as the Portfolio's investment advisor and service agent. As
compensation for its services the Portfolio pays PIMC a fee, computed daily
and paid monthly, at the following rate: .20% of the first $250 million,
.15% of the next $250 million, .12% of the next $250 million, .10% of the
next $250 million, and .08% of amounts in excess of $1 billion.
Short-Term Portfolio - Neuberger & Berman ("N&B"), a New York limited
partnership, serves as the Portfolio's investment advisor. As compensation
for its services, the Portfolio pays N&B a fee, computed daily and paid
monthly, at the following rate: .30% of the first $50 million, .20% of the
next $50 million, .15% of the next $150 million, and .10% of amounts in
excess of $250 million.
Health Plans Capital Services Corp. ("CSC") serves as the Fund's
administrator and acts generally in a supervisory capacity with respect to
the Fund's overall operations and relations with holders of PCs. As
compensation for its services each Portfolio pays CSC a fee, computed daily
and payable monthly at an annual rate not to exceed .05% of the average
daily net assets of each of the Fund's Portfolios.
PNC Bank acts as custodian of the Fund's assets and PFPC Inc. ("PFPC"), an
affiliate of PNC Bank, acts as the fund's transfer agent and dividend
disbursing agent. In addition, PIMC serves as the Short-Term Portfolio
service agent. PNC Bank, PIMC and PFPC receive fees from the Fund for
serving in these capacities.
PIMC and N&B have agreed contractually to reduce their advisory fees
otherwise payable to them in 1994 by the Money Market Portfolio and the
Short-Term Portfolio, respectively, to the extent necessary to reduce the
ordinary operating expenses of both Portfolios individually so that they do
not exceed 0.30 of one percent (0.30%) of each Portfolio's average net assets
for the year. Under these contractual agreements, PIMC and N&B waived $0 and
$100,985 of such fees, respectively, for the period ended December 31, 1994.
In addition, PIMC voluntarily waived $10,984 of advisory fees and CSC
voluntarily waived $3,661 of administrator fees payable by the Money Market
Portfolio during this period. PIMC voluntarily waived $709 of service agent
fees and CSC voluntarily waived $2,016 of administrator fees payable by the
Short-Term Portfolio during this period.
<PAGE>
<PAGE> 21
Notes to Financial Statements
-----------------------------
D. At December 31, 1994, net assets consisted of:
<TABLE>
<CAPTION>
Money Market Short-Term
Portfolio Portfolio
------------ ------------
<S> <C> <C>
Capital paid in.................... $451,366,634 $104,577,016
Accumulated realized gain (loss) on
security transactions............ - (907,947)
Net unrealized depreciation of
investments...................... - (429,369)
------------ ------------
$451,366,634 $103,239,700
============ ============
</TABLE>
E. Short-Term Portfolio purchases and sales of investment securities, other
than short-term investments, were $47,569,756 and $84,049,524, respectively,
and purchases and sales of U.S. Government securities were $16,977,188 and
$31,741,378, respectively, for the period ended December 31, 1994.
<PAGE>
<PAGE> 22
[This page intentionally left blank]
<PAGE>
<PAGE> 23
Report of Independent Accountants
To the Participation Certificate Holders and
Trustees of Plan Investment Fund, Inc.
We have audited the accompanying statements of net assets of the Money Market
Portfolio and Short-Term Portfolio of Plan Investment Fund, Inc. (the "Fund") as
of December 31, 1994, and the related statements of operations for the year then
ended, the statements 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 physical inspection and confirmation of
investments held by the custodian and others as of December 31, 1994. An audit
also 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 audits provide 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 Plan
Investment Fund, Inc. as of December 31, 1994, the results of their operations
for the year then ended, the changes in their 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 conformity with generally accepted
accounting principles.
COOPERS & LYBRAND L.L.P.
2400 Eleven Penn Center
Philadelphia, PA
February 2, 1995
<PAGE>
<PAGE> 24
------------------------------------------------------------
PLAN INVESTMENT FUND, INC.
676 N. St. Clair
Chicago, Illinois 60611
(312) 440-6372
TRUSTEES
--------
ALBERT F. ANTONINI RALPH S. RHOADES
President and President and
Chief Executive Officer Chief Executive Officer
Blue Cross and Blue Shield of Blue Cross and Blue Shield
of Central New York, Inc. of Oklahoma
PHILIP A. GOSS DONALD P. SACCO
President and President
Chief Executive Officer Pierce County Medical
Plan Investment Fund, Inc.
Health Plans Capital NORMAN C. STORBAKKEN
Services Corp. Group Vice President and
Chief Financial Officer
STEVEN L. HOOKER Blue Cross and Blue Shield
Senior Vice President, Finance of Minnesota
Blue Cross and Blue Shield
of Oregon THOMAS J. WARD
President and
WILLIAM M. LOWRY Chief Executive Officer
President and Blue Cross of Northeastern
Chief Executive Officer Pennsylvania
Blue Cross of Western
Pennsylvania SHERMAN M. WOLFF
Senior Vice President, Finance
DAVID M. MURDOCH Blue Cross and Blue Shield
Senior Vice President of Illinois
Blue Cross and Blue Shield
Association
INVESTMENT ADVISORS
-------------------
MONEY MARKET PORTFOLIO SHORT-TERM PORTFOLIO
---------------------- --------------------
PNC Institutional Management Corporation Neuberger & Berman
Wilmington, Delaware New York, New York
<PAGE>
<PAGE> 25
EDGAR Appendix
This appendix describes components of the printed version of this report
that do not translate into a format aceptable to the EDGAR system.
The cover of the printed version of this report includes a logo of the
administrator of Plan Investment Fund Inc., Health Plans Capital Services
Corp. The logo includes the full legal name and address of the
administrator and abbreviated initials of the administrator, "CSC".
A header featuring the Plan Investment Fund, Inc. logo appears at the
top of pages 6, 8, 10, 12, 14, 16 and 18. The logo includes the
abbreviated initials of the fund, "PIF", enclosed in a box beneath a line
bar.
A performance line chart which depicts the growth of a $10,000 investment
in the PIF Short-Term Portfolio and the six month treasury bill since
inception, March 11, 1987, appears in the middle of page 5 of the report.
The following table depicts the substance of the chart and provides the
point plots.
Growth of $10,000 Investment
Since March 11, 1987 Inception
<TABLE>
<CAPTION>
Short-Term Six Month
Portfolio Treasury Bill
--------- -------------
<S> <C> <C>
3/87 $10,000 $10,000
12/87 10,413 10,501
12/88 11,158 11,238
12/89 12,209 12,224
12/90 13,269 13,216
12/91 14,324 14,035
12/92 14,916 14,597
12/93 15,473 15,071
12/94 16,008 15,727
</TABLE>
Past Performance is Not
Predictive of Future Performance
