Institutional Government Portfolio
Institutional Federal Portfolio
Institutional Cash Portfolio
Institutional Tax-Free Portfolio
345 Park Avenue, New York, New York 10154
(800) 854-8525
Investment Manager
Scudder, Stevens & Clark, Inc.
345 Park Avenue
New York, New York 10154
Distributor
Scudder Investor Services, Inc.
Two International Place
Boston, Massachusetts 02110
Custodian
State Street Bank and Trust Company
225 Franklin Street
Boston, Massachusetts 02110
Fund Accounting Agent
Scudder Fund Accounting Corporation
Two International Place
Boston, Massachusetts 02110
Transfer Agent and
Dividend Disbursing Agent
Scudder Service Corporation
P.O. Box 9242
Boston, Massachusetts 02205
Legal Counsel
Sullivan & Cromwell
New York, New York
The Portfolios are neither insured nor guaranteed by the U.S. Government. Each
Portfolio intends to maintain a net asset value per share of $1.00 but there is
no assurance that it will be able to do so.
This report is for the information of the shareholders. Its use in connection
with any offering of the Company's shares is authorized only in case of a
concurrent or prior delivery of the Company's current prospectus.
INSTITUTIONAL GOVERNMENT PORTFOLIO
INSTITUTIONAL FEDERAL PORTFOLIO
INSTITUTIONAL CASH PORTFOLIO
INSTITUTIONAL TAX-FREE PORTFOLIO
MID-YEAR REPORT
JUNE 30, 1996
<PAGE>
<TABLE>
<CAPTION>
Board of Directors
<S> <C>
DAVID S. LEE(1) Chairman of the Board; Managing Director, Scudder, Stevens
& Clark, Inc.
EDGAR R. FIEDLER(1) (2) (3) Vice President and Economic Counsellor, The Conference Board;
formerly Assistant Secretary of the Treasury for Economic Policy
PETER B. FREEMAN(2) (3) Corporate Director and Trustee
ROBERT W. LEAR(2) (3) Executive-in-Residence and Visiting Professor, Columbia
University Graduate School of Business; Director or Trustee,
Various Organizations
DANIEL PIERCE(1) President; Chairman of the Board, Scudder, Stevens & Clark, Inc.
(1)Member of Executive Committee
(2)Member of Nominating Committee
(3)Member of Audit Committee
---------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------
Officers
DAVID S. LEE Chairman of the Board
DANIEL PIERCE President
K. SUE COTE Vice President
JERARD K. HARTMAN Vice President
KATHRYN L. QUIRK Vice President
THOMAS W. JOSEPH Vice President and Assistant Secretary
THOMAS F. McDONOUGH Vice President and Assistant Secretary
PAMELA A. McGRATH Vice President and Treasurer
IRENE McC. PELLICONI Secretary
</TABLE>
2
<PAGE>
Dear Shareholder:
Operated exclusively for institutions and their clients, Scudder Institutional
Fund, Inc., which includes Institutional Government Portfolio, Institutional
Federal Portfolio, Institutional Cash Portfolio, and Institutional Tax-Free
Portfolio, provided competitive investment results in the first six months of
1996. These four money market portfolios seek to provide high levels of current
income while preserving capital and maintaining liquidity.
All four portfolios seek to maintain a net asset value of $1.00, and have done
so since their inception. (There is no guarantee, of course, that each portfolio
will maintain stable net asset values.) The Institutional Federal Portfolio
seeks to maximize income exempt from state and local income taxes, while the
Institutional Tax-Free Portfolio seeks to provide income exempt from Federal
income tax.
Total net assets were $413 million on June 30, compared with $425 million on
December 31, 1995. A table showing dividend payments and other financial
information for the six months ended June 30, 1996, as well as the five years
ended December 31 for each portfolio is on page 16. In addition, please see the
following pages for financial statements for the semiannual period, as well as a
list of each portfolio's investments.
If you have any questions concerning the Scudder Institutional Fund, Inc.,
please call toll free (800) 854-8525.
/s/David S. Lee
David S. Lee
Chairman
3
<PAGE>
SCUDDER INSTITUTIONAL FUND, INC.
<TABLE>
STATEMENT OF NET ASSETS (UNAUDITED)
JUNE 30, 1996
GOVERNMENT PORTFOLIO
<CAPTION>
MATURITY PRINCIPAL VALUE
DATE AMOUNT (NOTE 2a)
-------- ----------- ------------
<S> <C> <C> <C>
U.S. GOVERNMENT AGENCY OBLIGATIONS -- 99.8%
Federal Farm Credit Bank Discount Note ...................................... 9/30/96 $ 6,000,000 $ 5,919,617
Federal Home Loan Bank Discount Note ........................................ 5/5/97 2,000,000 1,904,691
Federal Home Loan Mortgage Corp. Discount Note .............................. 7/22/96 2,000,000 1,993,840
Federal Home Loan Mortgage Corp. Discount Note .............................. 7/31/96 3,000,000 2,987,875
Federal Home Loan Mortgage Corp. Discount Note .............................. 8/14/96 2,580,000 2,563,634
Federal Home Loan Mortgage Corp. Discount Note .............................. 8/26/96 2,200,000 2,182,204
Federal Home Loan Mortgage Corp. Discount Note .............................. 9/6/96 700,000 693,069
Federal National Mortgage Assn. Discount Note ............................... 7/18/96 4,000,000 3,990,046
Federal National Mortgage Assn. Discount Note ............................... 9/5/96 2,500,000 2,476,304
Student Loan Marketing Assn. Variable Rate Note, 6.08% ...................... 7/1/96 5,000,000 5,000,000
Student Loan Marketing Assn. Variable Rate Note, 5.22% ...................... 7/2/96* 11,700,000 11,700,000
Student Loan Marketing Assn. Variable Rate Note, 5.40% ...................... 7/2/96* 8,000,000 8,018,602
------------
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS (cost $49,429,882)** .............. 49,429,882
OTHER ASSETS AND LIABILITIES -- 0.2% ------------
Cash ................................................................................................. 94,203
Interest receivable and other assets ................................................................. 346,250
Dividend payable ..................................................................................... (241,840)
Management fee payable (note 4) ...................................................................... (7,192)
Accrued expenses (note 4) ............................................................................ (99,425)
------------
91,996
------------
NET ASSETS -- 100.0%
Applicable to 49,521,878 shares of $.001 par value Capital Stock outstanding;
5,000,000,000 shares authorized (note 5) ........................................................... $ 49,521,878
============
NET ASSET VALUE PER SHARE ............................................................................ $1.00
=====
<FN>
* Date of next interest rate change.
** Cost for federal income tax purposes.
</FN>
</TABLE>
See notes to financial statements.
4
<PAGE>
SCUDDER INSTITUTIONAL FUND, INC.
<TABLE>
STATEMENT OF NET ASSETS (UNAUDITED)
JUNE 30, 1996
<CAPTION>
FEDERAL PORTFOLIO
MATURITY PRINCIPAL VALUE
DATE AMOUNT (NOTE 2a)
-------- --------- ----------
<S> <C> <C> <C>
U.S. TREASURY OBLIGATIONS - 100.1%
U.S. Treasury Bill ......................................................... 7/11/96 $2,000,000 $1,997,255
U.S. Treasury Bill ......................................................... 7/25/96 5,300,000 5,282,865
U.S. Treasury Bill ......................................................... 8/1/96 3,000,000 2,987,802
U.S. Treasury Bill ......................................................... 8/8/96 2,100,000 2,088,983
U.S. Treasury Bill ......................................................... 8/22/96 1,500,000 1,489,246
U.S. Treasury Bill ......................................................... 8/29/96 1,000,000 991,724
U.S. Treasury Bill ......................................................... 11/29/96 500,000 489,168
-----------
TOTAL U.S. TREASURY OBLIGATIONS (cost $15,327,043)** ................................................... 15,327,043
-----------
OTHER ASSETS AND LIABILITIES - (0.1%)
Cash ................................................................................................... 98,019
Other assets ........................................................................................... 5,194
Dividend payable ....................................................................................... (50,018)
Management fee payable (note 4) ........................................................................ (14,121)
Accrued expenses (note 4) .............................................................................. (59,146)
-----------
(20,072)
-----------
NET ASSETS - 100.0%
Applicable to 15,306,971 shares of $.001 par value Capital Stock outstanding;
5,000,000,000 shares authorized (note 5) ............................................................. $15,306,971
===========
NET ASSET VALUE PER SHARE .............................................................................. $1.00
=====
<FN>
** Cost for federal income tax purposes.
</FN>
</TABLE>
See notes to financial statements.
5
<PAGE>
SCUDDER INSTITUTIONAL FUND, INC.
<TABLE>
STATEMENT OF NET ASSETS (UNAUDITED)
JUNE 30, 1996
<CAPTION>
CASH PORTFOLIO
MATURITY PRINCIPAL VALUE
DATE AMOUNT (NOTE 2a)
-------- ----------- ------------
<S> <C> <C> <C>
CERTIFICATES OF DEPOSIT - 4.6%
Harris Trust & Savings Bank, 5.44%
(cost $12,000,000) ........................................... 9/9/96 $12,000,000 $ 12,000,000
------------
COMMERCIAL PAPER - 55.9%
A.I. Credit Corp. .............................................. 7/30/96 10,000,000 9,957,225
American General Finance Corp. ................................. 8/22/96 11,000,000 10,914,676
AT&T Corp. ..................................................... 7/10/96 12,000,000 11,984,220
Associates Corp. of North America .............................. 8/30/96 12,000,000 11,892,800
Credit Agricole U.S.A .......................................... 7/8/96 13,000,000 12,986,729
Ford Motor Credit Co. .......................................... 7/11/96 10,000,000 9,985,250
General Electric Capital Services Inc. ......................... 9/11/96 12,000,000 11,875,440
Household Finance Corp. ........................................ 7/12/96 10,000,000 9,983,592
J.P. Morgan & Co. Inc. ......................................... 9/5/96 10,000,000 9,908,517
New Center Asset Trust ......................................... 9/24/96 10,000,000 9,874,389
Norwest Corp. .................................................. 8/14/96 10,000,000 9,934,489
Prudential Funding Corp. ....................................... 9/19/96 4,000,000 3,952,267
Republic New York Corp ......................................... 7/30/96 12,000,000 11,951,473
Xerox Credit Corp. ............................................. 7/19/96 10,200,000 10,173,123
------------
TOTAL COMMERCIAL PAPER (cost $145,374,190) ..................... 145,374,190
------------
REPURCHASE AGREEMENTS - 7.0%
Donaldson, Lufkin & Jenrette Securities Corp. ..................
dated 6/28/95 at 5.45% (proceeds at maturity
$18,232,277) collateralized by $17,545,000
U.S. Treasury Bill, 1/15/97
(cost $18,224,000) (note 3) .................................. 7/1/96 18,224,000 18,224,000
------------
U.S. GOVERNMENT AGENCY OBLIGATIONS - 20.7%
Federal National Mortgage Assn. Variable Rate Note, 5.52% ...... 9/14/96* 15,000,000 15,000,000
Federal National Mortgage Assn. Discount Note .................. 7/24/98 5,000,000 4,984,635
Federal National Mortgage Assn. Discount Note .................. 7/29/98 10,000,000 9,962,511
Student Loan Marketing Assn. Variable Rate Note, 5.41% ......... 7/2/96* 14,000,000 14,000,000
Student Loan Marketing Assn. Variable Rate Note, 5.59% ......... 7/2/96* 10,000,000 10,023,252
------------
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS (cost $53,970,398) .... 53,970,398
------------
</TABLE>
See notes to financial statements.
6
<PAGE>
<TABLE>
<CAPTION>
MATURITY PRINCIPAL VALUE
DATE AMOUNT (NOTE 2a)
-------- ----------- ------------
<S> <C> <C> <C>
NOTES - 15.7%
Adesa Funding Corp. (LOC Banc One), 5.5% ....................... 7/4/96* 2,487,000 2,487,000
Bank of America Illinois, 5.7% ................................. 5/28/97 2,500,000 2,497,572
Fifth Third Bank, 5.38% ........................................ 8/20/96 9,000,000 9,000,000
First National Bank Discount Note .............................. 9/19/96 6,000,000 5,928,533
NationsBank N.A. Discount Note ................................. 7/3/96 6,000,000 5,998,233
NationsBank South Discount Note ................................ 7/2/96 5,000,000 4,999,264
Pittsburgh National Bank Discount Note ......................... 7/1/96* 10,000,000 9,990,170
------------
TOTAL NOTES (cost $40,900,772) .............................................................. 40,900,772
------------
TOTAL INVESTMENTS - 103.9% (Cost $270,469,360)** ............................................ 270,469,360
------------
OTHER ASSETS AND LIABILITIES - (3.9%)
Cash ........................................................................................ 57,326
Receivable for capital stock sold ........................................................... 799,013
Interest receivable and other assets ........................................................ 353,509
Dividend payable ............................................................................ (1,199,628)
Payable for investments purchased ........................................................... (9,990,170)
Management fee payable (note 4) ............................................................. (34,791)
Accrued expenses (note 4) ................................................................... (145,614)
------------
(10,160,355)
------------
NET ASSETS - 100.0%
Applicable to 260,309,005 shares of $.001 par value Capital Stock outstanding;
5,000,000,000 shares authorized (note 5) .................................................. $260,309,005
============
NET ASSET VALUE PER SHARE ................................................................... $1.00
=====
<FN>
* Date of next interest rate change.
** Cost for federal income tax purposes.
ABBREVIATIONS USED IN THE STATEMENT:
LOC Letter of Credit
</FN>
</TABLE>
See notes to financial statements.
7
<PAGE>
SCUDDER INSTITUTIONAL FUND, INC.
<TABLE>
STATEMENT OF NET ASSETS (UNAUDITED)
JUNE 30, 1996
<CAPTION>
TAX-FREE PORTFOLIO
CREDIT PRINCIPAL VALUE
RATING* SHORT-TERM MUNICIPAL SECURITIES - 99.9% AMOUNT (NOTE 2a)
- ------- ---------- ----------
<S> <C> <C> <C>
ALASKA
A-1+ Alaska Housing Finance Corp. General Mortgage Revenue Series 1991-A
VRDN, 3.4%, 6/1/26 ................................................ $3,000,000 $3,000,000
----------
ARIZONA
A-1+ Apache County Industrial Development Revenue Tuscan Electric Co.
Springerville Project 1985 Series A VRDN, 3.3%, 12/1/20 ........... 500,000 500,000
A-1+ Pima County Industrial Development Authority Tucson Electric
Power Co. 1982 Series A VRDN, 3.35%, 7/1/22 ....................... 1,900,000 1,900,000
A-1 Salt River Project Electric System Revenue Refunding Series 1992-A TOB,
3.35%, 1/1/09 ..................................................... 3,000,000 3,000,000
----------
TOTAL ARIZONA ................................................. 5,400,000
----------
CALIFORNIA
SP1+ California Community College Finance Authority Pooled Tax and Revenue
Anticipation Notes Series B, 5%, 8/30/96 .......................... 1,500,000 1,501,176
SS&C City Of Riverside California Willows Project Series, 3.425%, 5/1/05 . 1,500,000 1,500,000
Lancaster California Willows Project Series VRDN, 3.425%, 2/1/05 .... 1,000,000 1,000,000
MIG-1 Los Angeles County California TRAN, 4.5%, 6/30/97 ................... 1,000,000 1,006,240
SP1+ Los Angeles County Local Educational Agencies Pool TRAN, 4.75%,
7/5/96 ............................................................ 1,000,000 1,000,068
SP1+ South Coast Local Education Agencies Pooled Tax and Revenue
Anticipation Note Program, 5%, 8/14/96 ............................ 1,000,000 1,000,575
----------
TOTAL CALIFORNIA .............................................. 7,008,059
----------
COLORADO
A-1+ Clear Creek County Financing Program Series 1988, VRDN, 3.4%,
6/1/98 ............................................................ 205,000 205,000
A-1 Colorado Housing Finance Authority Central Park Coventry Village &
Greenwood Point Series 1985 VRDN, 3.35%, 5/1/97 ................... 1,000,000 1,000,000
----------
TOTAL COLORADO ................................................ 1,205,000
----------
CONNECTICUT
A-1+ Hartford Redevelopment Agency VRDN, 3.4%, 6/1/20 .................... 2,000,000 2,000,000
----------
FLORIDA
A-1+ City Of Gainsville Florida Utilities System, 3.4%, 9/9/96 ........... 1,900,000 1,900,000
A-1+ Orlando Waste Water System Revenues Series 1990 A, TECP,
3.4%, 10/23/96 .................................................... 1,000,000 1,000,000
----------
TOTAL FLORIDA ................................................. 2,900,000
----------
</TABLE>
See notes to financial statements.
8
<PAGE>
<TABLE>
<CAPTION>
CREDIT PRINCIPAL VALUE
RATING* AMOUNT (NOTE 2a)
- ------- ---------- ----------
<S> <C> <C> <C>
GEORGIA
A-1+ DeKalb Private Hospital Authority Egleston Children's Hospital at Emory
University 1994 Series B VRDN, 3.3%, 3/1/24 ....................... 1,400,000 1,400,000
MIG-1 Savannah Downtown Development Authority Series 1985 VRDN, 3.675%,
5/1/15 ............................................................ 4,800,000 4,800,000
---------
TOTAL GEORGIA ................................................ 6,200,000
---------
INDIANA
MIG-1 Purdue University Indiana Student Fee Revenue Series 1995 L VRDN,
3.3%, 7/1/20 ...................................................... 4,200,000 4,200,000
A-1+ Trustees of Purdue University Student Fee Revenue Bonds, 3.3%,
7/1/17 ............................................................ 2,100,000 2,100,000
---------
TOTAL INDIANA ................................................ 6,300,000
---------
LOUSIANA
MIG-1 Louisiana Recovery District Sales Tax Revenue Bonds Series 1988 VRDN,
3.65%, 7/1/97 ..................................................... 3,500,000 3,500,000
---------
MARYLAND
A-1 Ann Arundel County Baltimore Electric And Gas Co., 3.7%, 8/23/96 .... 1,200,000 1,200,000
---------
MICHIGAN
SP1+ Michigan State General Obligation Unlimited Tax Notes 4%, 9/30/96 ... 1,750,000 1,753,226
A-1+ Michigan Strategic Fund Pollution Control Revenue Consumers Power
Company Project VRDN, 3.6%, 6/15/10 ............................... 200,000 200,000
---------
TOTAL MICHIGAN 1,953,226
---------
MINNESOTA
A-1+ Regents of the University of Minnesota Series 1996A TECP, 3.5%,
10/22/96 .......................................................... 1,000,000 1,000,000
---------
MISSISSIPPI
P-1 Jackson County Pollution Control Revenue, 3.5%, 6/1/23 .............. 2,300,000 2,300,000
---------
NEBRASKA
P-1 Omaha Public Power Distric Series 1983 TECP, 3.55%, 9/9/96 .......... 1,050,000 1,050,000
---------
NEW YORK
A-1+ New York City Municipal Water Finance Authority VRDN FGIC insured,
3.550%, 6/15/24 ................................................... 2,000,000 2,000,000
---------
NORTH CAROLINA
A-1+ North Carolina Municipal Power Agency #1 Catawba Project Series 1996 A
TECP, 3.65%, 11/13/96 ............................................. 2,000,000 2,000,000
---------
</TABLE>
See notes to financial statements.
9
<PAGE>
SCUDDER INSTITUTIONAL FUND, INC.
<TABLE>
STATEMENT OF NET ASSETS (UNAUDITED)
JUNE 30, 1996
TAX-FREE PORTFOLIO (CONTINUED)
<CAPTION>
CREDIT PRINCIPAL VALUE
RATING* AMOUNT (NOTE 2a)
- ------- ---------- ----------
<S> <C> <C> <C>
OHIO
SS&C Cincinnati City School Distric TAN, Series 1996 A, 6%, 12/1/97 ...... 2,280,000 2,281,519
----------
OREGON
MIG-1 Oregon General Obligation Series 1973-G VRDN, 3.25%, 12/1/18 ........ 1,900,000 1,900,000
----------
PENNSYLVANIA
SS&C Elk County Pennsylvania Industrial Development Authority, 3.85%,
3/1/04 ............................................................ 1,000,000 1,000,000
A-1+ Emmaus General Authority Pennsylvania Local Government VRDN,
3.35%, 3/1/24 ..................................................... 1,000,000 1,000,000
A-1 Emmaus General Authority Local Government Revenue Bond Pool
Program 1989 Series G-5 VRDN, 3.4%, 3/1/24 ........................ 1,200,000 1,200,000
A-1+ Emmaus General Authority Local Government Revenue Bond Pool
Program 1989 Series G VRDN, 3.35%, 3/1/24 ......................... 1,500,000 1,500,000
MIG-1 Philadelphia General Obligation Bond, 4.5%, 6/30/97 ................. 1,000,000 1,005,240
----------
TOTAL PENNSYLVANIA ........................................... 5,705,240
----------
TENNESSEE
MIG-1 Franklin Industrial Development Revenue Franklin Oaks Apartments
VRDN, 3.5%, 12/1/07 ............................................... 2,000,000 2,000,000
A-1+ Metropolitan Nashville Airport Authority, 3.65%, 10/1/12 ............ 1,500,000 1,500,000
----------
TOTAL TENNESSEE .............................................. 3,500,000
----------
TEXAS
A-1+ Austin Combined Utility Systems, 3.6%, 10/8/96 ...................... 1,000,000 1,000,000
MIG-1 Lone Star Airport Improvement VRDN, 3.65%, 12/1/14 .................. 1,000,000 1,000,000
A-1+ San Antonio Electric and Gas City Public Services Series 1995 A
TECP, 3.05%, 10/25/96 ............................................. 3,000,000 3,000,000
A-1+ San Antonio Water System Revenue Series 1995 TECP, 3.4%, 8/21/96 .... 1,500,000 1,500,000
SP1+ State of Texas TRAN, 4.75%, 8/30/96 ................................. 6,600,000 6,610,722
----------
TOTAL TEXAS .................................................. 13,110,722
----------
UTAH
A-1+ Salt Lake City Utah Pooled Hospital Finances, 3.15%, 7/12/96 ........ 1,000,000 1,000,000
----------
VERMONT
SS&C Vermont Industrial Development Authority Mount Snow Limited Series 1904
VRDN, 4.21%, 4/1/99 ............................................... 630,000 630,000
MIG-1 Vermont Student Assistance Corporation VRDN, 3.65%, 1/1/04 .......... 2,800,000 2,800,000
----------
TOTAL VERMONT ................................................ 3,430,000
----------
</TABLE>
See notes to financial statements.
10
<PAGE>
<TABLE>
CREDIT PRINCIPAL VALUE
RATING* AMOUNT (NOTE 2a)
- ------- ---------- ----------
<S> <C> <C> <C>
WASHINGTON
A-1+ Washington Healthcare Facilities Authority Series 1985-E VRDN, 3.55%,
10/1/05 ........................................................... 1,000,000 1,000,000
MIG-1 Washington Public Power Supply System Projects #1 and #3 Refunding
Revenue Series 1993-1A1 VRDN, 3.35%, 7/1/18 ....................... 1,475,000 1,475,000
A-1 Washington State Public Power Supply System Nuclear Project #1,
1993 Series 1A-1 VRDN, 3.3%, 7/1/17 ............................... 4,800,000 4,800,000
-----------
TOTAL WASHINGTON ............................................. 7,275,000
-----------
WISCONSIN
A-1+ Wausau Pollution Control Revenue Minnesota Mining and
Manufacturing Series 1982 VRDN, 3.75%, 8/1/17 ..................... 500,000 500,000
-----------
TOTAL INVESTMENT PORTFOLIO - 99.9% (Cost $87,718,766)** ............. 87,718,766
-----------
OTHER ASSETS AND LIABILITIES - 0.1%
Cash ........................................................................................ $ 1,350,012
Interest receivable and other assets ........................................................ 835,708
Receivable for investments sold ............................................................. 150,000
Payable for investments purchased ........................................................... (2,011,480)
Dividend payable ............................................................................ (229,573)
Management fee payable (note 4) ............................................................. (11,046)
Accrued expenses (note 4) ................................................................... (36,983)
-----------
46,638
-----------
NET ASSETS - 100.0%
Applicable to 87,765,404 shares of $.001 par value Capital Stock outstanding;
2,000,000,000 shares authorized (note 5) ................................................. $87,765,404
===========
NET ASSET VALUE PER SHARE ................................................................... $1.00
=====
<FN>
** Cost for federal income tax purposes.
</FN>
</TABLE>
<TABLE>
- -----------------------------------------------------------------------------------------------------------------------------------
* CREDIT RATINGS (UNAUDITED) SHOWN ARE EITHER BY MOODY'S INVESTORS SERVICE, INC., STANDARD & POOR'S
CORPORATION OR SCUDDER:
<CAPTION>
MOODY'S STANDARD & POOR'S
<S> <C> <C>
P-1 A-1/A-1+ Commercial paper of the highest quality.
MIG-1/MIG-1+ SP-1/SP-1+ Short-term tax-exempt instrument of the best quality with strong protection.
VMIG-1 Short-term tax-exempt variable rate demand instrument of the best quality with strong protection.
</TABLE>
11
<PAGE>
SCUDDER INSTITUTIONAL FUND, INC.
<TABLE>
STATEMENT OF NET ASSETS (UNAUDITED)
JUNE 30, 1996
TAX-FREE PORTFOLIO (CONTINUED)
ABBREVIATIONS USED IN THE STATEMENT:
<S> <C> <C> <C>
TECP Tax Exempt Commercial Paper VRDN Variable Rate Demand Note
OP Security with a "optional put" feature; date shown SS&C These securities are not rated by either Moody's or
represents the earliest date the security may be Standard & Poor's. Scudder has determined that these
redeemed or the interest rate will be reset if the securities are of comparable quality to rated acceptable
security is not redeemed notes on a cash flow basis and are of appropriate credit
for the standards required by the Fund's investment
objective.
TOB Tender Option Bond is a security with a periodic TRAN Tax Revenue Anticipation Note
"put feature"
RAN Revenue Anticipation Note TAN Tax Anticipation Note
</TABLE>
See notes to financial statements.
12
<PAGE>
SCUDDER INSTITUTIONAL FUND, INC.
<TABLE>
STATEMENT OF OPERATIONS (UNAUDITED)
SIX MONTHS ENDED JUNE 30, 1996
<CAPTION>
GOVERNMENT FEDERAL CASH TAX-FREE
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------- --------- ---------- ----------
<S> <C> <C> <C> <C>
INVESTMENT INCOME:
Interest Income ......................... $1,644,779 $478,893 $7,557,730 $1,733,595
---------- -------- ---------- ----------
EXPENSES (NOTE 2c):
Management fee (note 4) ................. 45,795 14,120 209,898 74,177
Shareholder services (note 4) ........... 24,270 15,793 19,010 23,871
Directors' fees and expenses (note 4) ... 4,926 4,570 6,591 5,503
Custodian and accounting fees (note 4) .. 22,118 18,192 32,837 31,600
Professional services ................... 8,789 3,628 24,298 11,805
Reports to shareholders ................. 657 218 3,506 1,674
Registration fees ....................... 2,149 -- 3,236 2,104
Miscellaneous ........................... 8,245 8,775 10,847 3,937
---------- -------- ---------- ----------
Total expenses before reductions ........ 116,949 65,296 310,223 154,671
Expense reductions (note 4) ............. -- (12,508) -- --
---------- -------- ---------- ----------
Net expenses .......................... 116,949 52,788 310,223 154,671
---------- -------- ---------- ----------
NET INVESTMENT INCOME AND INCREASE IN NET
ASSETS FROM OPERATIONS ................ $1,527,830 $426,105 $7,247,507 $1,578,924
========== ======== ========== ==========
</TABLE>
See notes to financial statements.
13
<PAGE>
SCUDDER INSTITUTIONAL FUND, INC.
<TABLE>
STATEMENTS OF CHANGES IN NET ASSETS (UNAUDITED)
<CAPTION>
GOVERNMENT PORTFOLIO
-------------------------------
SIX MONTHS YEAR
ENDED ENDED
6/30/96 12/31/95
------------- -------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income and increase in net assets
from operations ...................................... $ 1,527,830 $ 3,796,930
Dividends (notes 2b and 2d) ............................ (1,527,830) (3,796,930)
------------- -------------
-- --
------------- -------------
CAPITAL STOCK TRANSACTIONS (note 5):
Proceeds from sales of shares .......................... 101,339,339 432,240,116
Net asset value of shares issued in reinvestment of
dividends ............................................ 372,641 1,131,510
------------- -------------
101,711,980 433,371,626
Cost of shares redeemed ................................ (132,108,463) (471,317,385)
------------- -------------
Increase (decrease) in net assets from Capital Stock
transactions ......................................... (30,396,483) (37,945,759)
------------- -------------
Total increase (decrease) in net assets .................. (30,396,483) (37,945,759)
NET ASSETS:
Beginning of period .................................. 79,918,361 117,864,120
------------- -------------
End of period ........................................ $ 49,521,878 79,918,361
============= =============
</TABLE>
See notes to financial statements.
14
<PAGE>
<TABLE>
<CAPTION>
FEDERAL PORTFOLIO CASH PORTFOLIO TAX-FREE PORTFOLIO
------------------------------ ------------------------------- ------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
6/30/96 12/31/95 6/30/96 12/31/95 6/30/96 12/31/95
------------- ------------ ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
$ 426,105 $ 780,485 $ 7,247,507 $ 18,218,019 $ 1,578,924 $ 3,440,240
(426,105) (780,485) (7,247,507) (18,218,019) (1,578,924) (3,440,240)
------------ ------------ ------------- ------------- ------------- -------------
-- -- -- -- -- --
------------ ------------ ------------- ------------- ------------- -------------
39,720,954 81,622,544 380,274,345 924,578,235 196,620,966 522,266,284
447,777 690,840 2,316,684 6,908,170 238,059 907,361
------------ ------------ ------------- ------------- ------------- -------------
40,168,731 82,313,384 382,591,029 931,486,405 196,859,025 523,173,645
(41,282,043) (76,948,070) (371,710,153) (953,063,076) (188,142,934) (611,981,728)
------------ ------------ ------------- ------------- ------------- -------------
(1,113,312) 5,365,314 10,880,876 (21,576,671) 8,716,091 (88,808,083)
------------ ------------ ------------- ------------- ------------- -------------
(1,113,312) 5,365,314 10,880,876 (21,576,671) 8,716,091 (88,808,083)
16,420,283 11,054,969 249,428,129 271,004,800 79,049,313 167,857,396
------------ ------------ ------------- ------------- ------------- -------------
$ 15,306,971 $ 16,420,283 $ 260,309,005 $ 249,428,129 $ 87,765,404 $ 79,049,313
============ ============ ============= ============= ============= =============
</TABLE>
See notes to financial statements.
15
<PAGE>
SCUDDER INSTITUTIONAL FUND, INC.
FINANCIAL HIGHLIGHTS (UNAUDITED)
<TABLE>
THE FOLLOWING TABLE INCLUDES SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT
EACH YEAR AND OTHER PERFORMANCE INFORMATION DERIVED FROM THE FINANCIAL
STATEMENTS.
<CAPTION>
RATIO OF RATIO OF NET
OPERATING INVESTMENT
NET ASSET NET ASSET EXPENSES INCOME NET ASSETS
VALUE, AT NET VALUE, AT TO AVERAGE TO AVERAGE END OF
BEGINNING INVESTMENT DIVIDENDS END TOTAL DAILY DAILY PERIOD
PERIOD OF PERIOD INCOME PAID OF PERIOD RETURN NET ASSETS NET ASSETS (MILLIONS)
- -------------------------- --------- ---------- --------- --------- ------ ---------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
GOVERNMENT PORTFOLIO
Six Months ended 6/30/96 ... $1.00 $.025 $(.025) $1.00 2.51%** 0.38%* 5.00%* $ 50
Year ended 12/31/95 ........ 1.00 .055 (.055) 1.00 5.60 0.39 5.46 80
Year ended 12/31/94 ........ 1.00 .040 (.040) 1.00 4.09 0.28 3.89 118
Year ended 12/31/93 ........ 1.00 .030 (.030) 1.00 3.01 0.26 2.97 196
Year ended 12/31/92 ........ 1.00 .037 (.037) 1.00 3.74 0.24 3.69 247
Year ended 12/31/91 ........ 1.00 .057 (.057) 1.00 5.94 0.26 5.86 192
FEDERAL PORTFOLIO (a) (b)
Six Months ended 6/30/96 ... 1.00 .022 (.022) 1.00 2.27** 0.56* 4.53* 15
Year ended 12/31/95 ........ 1.00 .049 (.049) 1.00 5.06 0.52 4.97 16
Year ended 12/31/94 ........ 1.00 .034 (.034) 1.00 3.42 0.54 3.39 11
Year ended 12/31/93 ........ 1.00 .027 (.027) 1.00 2.74 0.23 2.73 8
Year ended 12/31/92 ........ 1.00 .032 (.032) 1.00 3.23 0.32 3.13 9
Year ended 12/31/91 ........ 1.00 .054 (.054) 1.00 5.55 0.30 5.51 11
CASH PORTFOLIO
Six Months ended 6/30/96 ... 1.00 .026 (.026) 1.00 2.61** 0.22* 5.18* 260
Year ended 12/31/95 ........ 1.00 .057 (.057) 1.00 5.88 0.25 5.73 249
Year ended 12/31/94 ........ 1.00 .041 (.041) 1.00 4.13 0.24 3.94 271
Year ended 12/31/93 ........ 1.00 .031 (.031) 1.00 3.16 0.22 3.12 468
Year ended 12/31/92 ........ 1.00 .038 (.038) 1.00 3.88 0.25 3.66 662
Year ended 12/31/91 ........ 1.00 .059 (.059) 1.00 6.12 0.25 5.89 308
TAX-FREE PORTFOLIO
Six Months ended 6/30/96 ... 1.00 .016 (.016) 1.00 1.61** 0.31* 3.19* 88
Year ended 12/31/95 ........ 1.00 .036 (.036) 1.00 3.69 0.35 3.61 79
Year ended 12/31/94 (a)(b) . 1.00 .027 (.027) 1.00 2.74 0.27 2.73 168
Year ended 12/31/93 ........ 1.00 .023 (.023) 1.00 2.32 0.29 2.30 125
Year ended 12/31/92 ........ 1.00 .029 (.029) 1.00 2.92 0.31 2.82 96
Year ended 12/31/91 ........ 1.00 .045 (.045) 1.00 4.65 0.36 4.55 75
<FN>
(a) The annualized operating expense ratio including expenses reimbursed,
management fee and other expenses not imposed would have been: 0.69% for
the six months ended June 30, 1996, 0.68%, 0.77%, 0.83%, 0.69%, and 0.67%
for the years ended December 31, 1995, 1994, 1993, 1992, and 1991,
respectively for the Federal Portfolio, and 0.29% for the year ended
December 31, 1994 for the Tax-Free Portfolio.
(b) Total returns are higher, for the periods indicated, due to the maintenance
of the Fund's expenses.
* Annualized
** Not annualized
</FN>
</TABLE>
16
<PAGE>
SCUDDER INSTITUTIONAL FUND, INC.
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
1. ORGANIZATION
Scudder Institutional Fund, Inc. (the "Fund") is an open-end diversified
management investment company which currently has four active money market
investment portfolios: the Government Portfolio, Federal Portfolio, Cash
Portfolio and Tax-Free Portfolio (collectively the "Portfolios").
2. SIGNIFICANT ACCOUNTING POLICIES
Significant accounting policies followed by the Fund are:
(a) Security Valuation--Each of the Portfolios values its investments using
the amortized cost method, which involves initially valuing an investment at its
cost and thereafter assuming a constant rate of amortization to maturity of any
premium or discount. This method results in a value approximating market.
(b) Federal Income Taxes--The Fund intends to qualify each Portfolio as a
regulated investment company under subchapter M of the Internal Revenue Code and
to distribute all of its taxable and tax-exempt income, including any realized
net capital gains, to shareholders. Therefore, no Federal income tax provision
is required.
(c) Allocation of Expenses--Expenses not directly chargeable to a specific
Portfolio are allocated primarily on the basis of relative net assets.
(d) Dividends--Dividends from net investment income are declared each
business day to shareholders of record that day and paid on the first business
day of the following month.
(e) Other--Investment transactions are recorded on trade date. Interest
income, including the accretion or amortization of discount or premium, is
recorded on the accrual basis. Discounts or premiums on securities purchased are
accreted or amortized, respectively, on a straight line basis over the life of
the respective securities. Distributions to shareholders are recorded on the
ex-dividend date.
The Cash Portfolio must have at least 25% of its investment portfolio
invested in bankers' acceptances, certificates of deposits, commercial paper,
fixed time deposits or other obligations of domestic and foreign banks.
3. REPURCHASE AGREEMENTS
It is the Fund's policy to obtain possession, through its custodian, of the
securities underlying each repurchase agreement to which it is a party, either
through physical delivery or book entry transfer in the Federal Reserve System
or Participants Trust Company. Payment by the Fund in respect of a repurchase
agreement is authorized only when proper delivery of the underlying securities
is made to the Fund's custodian. The Fund's investment manager values such
underlying securities each business day using quotations obtained from a
reputable, independent source. If the Fund's investment manager determines that
the value of such underlying securities (including accrued interest thereon)
does not at least equal the value of each repurchase agreement (including
accrued interest thereon) to which such securities are subject, the investment
manager will ask for additional securities to be delivered to the Fund's
custodian. In connection with each repurchase agreement transaction, if the
seller defaults and the value of the collateral declines or if the seller enters
an insolvency proceeding, realization of the collateral by the Fund may be
delayed or limited.
17
<PAGE>
SCUDDER INSTITUTIONAL FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
4. MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES
The investment advisory agreements between Scudder, Stevens & Clark, Inc.
("Scudder"), the Fund's investment manager, and the Fund on behalf of each
Portfolio provide for a management fee payable each month, based upon the
average daily value of each Portfolio's net assets, at annual rates of 0.15%.
Under certain state regulations, if the total expenses of any of the
Portfolios, exclusive of taxes, interest, and extraordinary expenses exceed
certain limitations, the Fund's investment adviser is required to reimburse the
Portfolio for such excess up to the amount of management fees. The adviser
agreed not to impose a portion of its management fee until October 31, 1996 and
during such period to maintain the annualized expenses of the Federal Portfolio
at not more than 0.70% of average daily net assets. During the six months ended
June 30, 1996, no such reimbursement was required.
Scudder Service Corporation ("SSC"), a subsidiary of Scudder, is the Fund's
shareholders service, transfer and dividend disbursing agent. For the six months
ended June 30, 1996, the amount charged to the Fund by SSC aggregated $11,611
for the Government Portfolio, Federal Portfolio, Cash Portfolio, and Tax-Free
Portfolio, respectively, of which $1,833, remains unpaid at June 30, 1996 for
each of the funds.
Scudder Fund Accounting Corporation ("SFAC"), a subsidiary of Scudder, is
responsible for determining the daily net asset value per share and maintaining
the portfolio and general accounting records for the Portfolios. For the six
months ended June 30, 1996, the amount charged to the Portfolios by SFAC
aggregated $15,000 for the Government Portfolio, $2,492 for the Federal
Portfolio, $20,945 for the Cash Portfolio, and $15,242 for the Tax-Free
Portfolio, of which $5,000, $684, $7,030, and $5,000, respectively, remain
unpaid at June 30, 1996. For the six months ended June 30, 1996 for the Federal
Portfolio, SFAC did not impose fees amounting to $12,508.
The Fund has a compensation arrangement under which payment of directors'
fees may be deferred. Interest is accrued (based on the rate of return earned on
the 90 day Treasury Bill as determined at the beginning of each calendar
quarter) on the deferred balances and is included in "Directors' fees and
expenses." The accumulated balance of deferred directors' fees and interest
thereon relating to all active Portfolios comprising the Fund aggregates
$215,444, an applicable portion of which is included in accrued expenses of each
of the Portfolios.
5. CAPITAL STOCK
At June 30, 1996, the Fund had 25,000,000,000 shares of $.001 par value
Capital Stock authorized, of which 5,000,000,000 shares each have been
designated for the Government Portfolio, Federal Portfolio and Cash Portfolio,
and 2,000,000,000 shares have been designated for the Tax-Free Portfolio. Net
paid in capital in excess of par value was $49,472,356 for the Government
Portfolio, $15,291,664 for the Federal Portfolio, $260,048,696 for the Cash
Portfolio and $87,677,639 for the Tax-Free Portfolio. At June 30, 1996, one
holder of record of the Government Portfolio held approximately 78% of the
outstanding shares; two holders of the Federal Portfolio held approximately 49%
and 41% each of the outstanding shares; one holder of the Cash Portfolio held
approximately 70% of the outstanding shares; and one holder of the Tax-Free
Portfolio held approximately 73% of the outstanding shares.
18
<PAGE>
INSTITUTIONAL GOVERNMENT PORTFOLIO
INSTITUTIONAL FEDERAL PORTFOLIO
INSTITUTIONAL CASH PORTFOLIO
INSTITUTIONAL TAX-FREE PORTFOLIO
MID-YEAR REPORT
JUNE 30, 1996
