DREYFUS SHORT-INTERMEDIATE GOVERNMENT FUND NOVEMBER 30, 1993
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN DREYFUS SHORT-
INTERMEDIATE
GOVERNMENT FUND AND THE MERRILL LYNCH TREASURY MASTER INDEX_SHORT-TERM
PRESIDENT'S LETTER
(Exhibit A)
Past performance is not predictive of future results.
The above illustration compares a $10,000 investment made in the Dreyfus
Short-Intermediate Government Fund on 4/6/87 (Inception Date) to a $10,000
investment made in the Merrill Lynch Treasury Master Index_Short-Term on that
date. All dividends and capital gain distributions are reinvested.
The Fund invests in securities issued or guaranteed by the U.S. Government or
its agencies or instrumentalities and repurchase agreements in respect of such
securities. The maximum remaining maturity of any instrument in the Fund's
portfolio will not exceed three and one-half years. The Fund's performance
takes into account fees and expenses. Unlike the Fund, the Merrill Lynch
Treasury Master Index--Short-Term is an unmanaged performance benchmark for
Treasury securities with maturities of 1-2.99 years; issues in the Index must
have par amounts outstanding greater than or equal to $25 million. The Index
does not take into account fees and expenses. Further information relating to
Fund performance including any expense reimbursements, if applicable, is
contained in the Condensed Financial Information section of the Prospectus and
elsewhere in this report.
* Source: Merrill Lynch
Dear Shareholder:
It is with pleasure that we can report to you that for the 12-month period
ended November 30, 1993, the Dreyfus Short- Intermediate Government Fund
produced a distribution rate per share of 6.65%, adjusted for capital gain
distributions.* As always, the Fund's net asset value is subject to change.
Taking into account that price change, as well as the reinvestment of income
dividends and capital gain distributions, your Fund produced a total return of
8.29% for the same 12-month period.**
In our last letter we reported that the Federal Open Market Committee
(FOMC) adopted a strategy geared toward a tightening of monetary policy.
Shortly after that letter was written, the FOMC bias turned back to neutral,
and at present remains guardedly neutral. Currently, the emphasis in the
market is to wait and see if first quarter economic results remain strong. The
FOMC does not want to tighten too early and be responsible for stalling any
part of an economic recovery. This leaves the market in a range-bound trading
environment until more definitive economic indications materialize.
The structure of the portfolio has been adjusted to reflect our estimate
of the range of the market. We are utilizing shorter-maturity Treasury issues
to keep liquid, and are extending into longer-maturity Treasuries when we deem
it appropriate. This approach allows us to be more defensive to protect the
net asset value of the Fund. It also reflects the current market psychology.
We feel that if and when the FOMC does move toward tightening, it will be done
both cautiously and gradually. It is important to note that some anticipation
of monetary tightening has already been priced into the market. If the
tightening occurs in the first quarter, it will not come as a surprise to the
market; if it does not occur, we could actually see a small rally in this
sector. Thus, there is more upside potential if tightening does not occur than
downside potential if there is additional tightening. By structuring your Fund
with this in mind, we are using all U.S. Treasury issues; this will give us
the ability to quickly extend while minimizing transaction costs.
As always, we will be carefully reviewing the market as well as economic
conditions. When we estimate the timing to be correct, we will adjust the
structure of the Fund's portfolio. In this way, we aim to continue to provide
you with an attractive investment vehicle.
Very truly yours,
(Barbara L. Kenworthy Signature Logo)
Barbara L. Kenworthy
President
December 30, 1993
New York, N.Y.
** Distribution rate per share is based upon dividends per share paid from net
investment income during the period, divided by net asset value per share
at the end of the period, adjusted for capital gain distributions.
** Total return represents the change during the period in a hypothetical
account with dividends reinvested.
<TABLE>
<CAPTION>
DREYFUS SHORT-INTERMEDIATE GOVERNMENT FUND
STATEMENT OF INVESTMENTS NOVEMBER 30, 1993
PRINCIPAL
NOTES-96.1% AMOUNT VALUE
------------ ------------
<S> <C> <C>
U.S. TREASURY NOTES-85.2%
10 1/2%, 8/15/1995......................................................... $ 24,000,000 $ 26,523,744
4 1/4%, 11/30/1995......................................................... 10,000,000 10,004,690
9 3/8%, 4/15/1996.......................................................... 157,000,000 174,490,742
8%, 10/15/1996............................................................. 60,000,000 65,503,140
8%, 1/15/1997.............................................................. 176,200,000 193,241,888
------------
TOTAL U.S. TREASURY NOTES...................................................... 469,764,204
============
U.S. TREASURY COUPON STRIPS-10.9%
Zero Coupon, 2/15/1997..................................................... 70,000,000 60,321,590
============
TOTAL NOTES
(cost $536,284,685)........................................................ $530,085,794
============
SHORT-TERM INVESTMENTS-2.3%
REPURCHASE AGREEMENT;
Aubrey G. Lanston & Co., 3.15%
Dated 11/30/1993, Due 12/1/1993 in the amount of $12,857,125
(fully collateralized by $13,100,000 U.S. Treasury Bills
due 1/6/1994, value $13,059,390)
(cost $12,856,000)......................................................... $ 12,856,000 $ 12,856,000
============
TOTAL INVESTMENTS
(cost $549,140,685)........................................................ 98.4% $542,941,794
====== ============
CASH AND RECEIVABLES (NET)..................................................... 1.6% $ 8,601,350
====== ============
NET ASSETS..................................................................... 100.0% $551,543,144
====== ============
See notes to financial statements.
</TABLE>
<TABLE>
<CAPTION>
DREYFUS SHORT-INTERMEDIATE GOVERNMENT FUND
STATEMENT OF ASSETS AND LIABILITIES NOVEMBER 30, 1993
ASSETS:
<S> <C> <C>
Investments in securities, at value
(cost $549,140,685)-see statement...................................... $542,941,794
Cash....................................................................... 1,056,308
Receivable for investment securities sold.................................. 14,954,420
Interest receivable........................................................ 8,586,440
Receivable for shares of Beneficial Interest subscribed.................... 52,723
Prepaid expenses........................................................... 26,424
------------
567,618,109
LIABILITIES:
Due to The Dreyfus Corporation............................................. $ 107,225
Payable for investment securities purchased................................ 14,975,514
Payable for shares of Beneficial Interest redeemed......................... 815,726
Accrued expenses........................................................... 176,500 16,074,965
------------ ------------
NET ASSETS..................................................................... $551,543,144
============
REPRESENTED BY:
Paid-in capital............................................................ $555,103,846
Accumulated undistributed net realized gain on investments................. 2,638,189
Accumulated gross unrealized (depreciation) on investments................. (6,198,891)
------------
NET ASSETS at value applicable to 48,166,261 shares outstanding
(unlimited number of shares $.001 par value Beneficial
Interest authorized)....................................................... $551,543,144
============
NET ASSET VALUE, offering and redemption price per share
($551,543,144 / 48,166,261 shares)......................................... $11.45
======
</TABLE>
<TABLE>
<CAPTION>
STATEMENT OF OPERATIONS YEAR ENDED NOVEMBER 30, 1993
INVESTMENT INCOME:
<S> <C> <C>
INTEREST INCOME............................................................ $ 31,506,730
EXPENSES:
Management fee-Note 2(a)............................................... $ 2,203,350
Shareholder servicing costs-Note 2(b).................................. 857,548
Registration fees...................................................... 105,200
Custodian fees......................................................... 55,073
Professional fees...................................................... 47,656
Trustees' fees and expenses-Note 2(c).................................. 30,539
Prospectus and shareholders' reports................................... 12,506
Miscellaneous.......................................................... 11,314
------------
3,323,186
Less-reduction in management fee due to undertakings-Note 2(a)......... 1,559,229
------------
TOTAL EXPENSES..................................................... 1,763,957
------------
INVESTMENT INCOME-NET.............................................. 29,742,773
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain on investments-Note 3.................................... $ 2,780,519
Net unrealized (depreciation) on investments............................... (643,062)
------------
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS.................... 2,137,457
------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........................... $ 31,880,230
============
See notes to financial statements.
</TABLE>
DREYFUS SHORT-INTERMEDIATE GOVERNMENT FUND
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
YEAR ENDED NOVEMBER 30,
----------------------------
1992 1993
------------ ------------
<S> <C> <C>
OPERATIONS:
Investment income-net...................................................... $ 15,847,355 $ 29,742,773
Net realized gain on investments........................................... 8,035,116 2,780,519
Net unrealized (depreciation) on investments for the year.................. (8,065,521) (643,062)
------------ ------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS................... 15,816,950 31,880,230
------------ ------------
DIVIDENDS TO SHAREHOLDERS FROM:
Investment income-net...................................................... (15,875,837) (29,742,773)
Net realized gain on investments........................................... (2,374,111) (8,173,840)
------------ ------------
TOTAL DIVIDENDS........................................................ (18,249,948) (37,916,613)
------------ ------------
BENEFICIAL INTEREST TRANSACTIONS:
Net proceeds from shares sold.............................................. 406,592,032 493,879,194
Dividends reinvested....................................................... 15,675,085 34,098,394
Cost of shares redeemed.................................................... (230,402,959) (304,044,477)
------------ ------------
INCREASE IN NET ASSETS FROM BENEFICIAL INTEREST TRANSACTIONS........... 191,864,158 223,933,111
------------ ------------
TOTAL INCREASE IN NET ASSETS....................................... 189,431,160 217,896,728
NET ASSETS:
Beginning of year.......................................................... 144,215,256 333,646,416
------------ ------------
End of year................................................................ $333,646,416 $551,543,144
============ ============
SHARES SHARES
------------ ------------
CAPITAL SHARE TRANSACTIONS:
Shares sold................................................................ 34,832,050 42,662,841
Shares issued for dividends reinvested..................................... 1,344,804 2,960,503
Shares redeemed............................................................ (19,670,333) (26,274,874)
------------ ------------
NET INCREASE IN SHARES OUTSTANDING..................................... 16,506,521 19,348,470
============ ============
See notes to financial statements.
</TABLE>
DREYFUS SHORT-INTERMEDIATE GOVERNMENT FUND
FINANCIAL HIGHLIGHTS
Contained below is per share operating performance data for a share of
Beneficial Interest outstanding, total investment return, ratios to average
net assets and other supplemental data for each year indicated. This
information has been derived from information provided in the Fund's financial
statements.
<TABLE>
<CAPTION>
YEAR ENDED NOVEMBER 30,
----------------------------------------------
PER SHARE DATA: 1989 1990 1991 1992 1993
------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year..... $11.10 $11.24 $11.23 $11.71 $11.58
------ ------ ------ ------ ------
INVESTMENT OPERATIONS:
Investment income-net.................. 1.02 .99 .85 .82 .78
Net realized and unrealized gain
(loss) on investments................ .14 (.01) .47 .09 .14
------ ------ ------ ------ ------
TOTAL FROM INVESTMENT OPERATIONS..... 1.16 .98 1.32 .91 .92
------ ------ ------ ------ ------
DISTRIBUTIONS:
Dividends from investment income-net... (1.02) (.99) (.84) (.83) (.78)
Dividends from net realized gain
on investments....................... -- -- -- (.21) (.27)
------ ------ ------ ------ ------
TOTAL DISTRIBUTIONS.................. (1.02) (.99) (.84) (1.04) (1.05)
------ ------ ------ ------ ------
Net asset value, end of year........... $11.24 $11.23 $11.71 $11.58 $11.45
====== ====== ====== ====== ======
TOTAL INVESTMENT RETURN 10.99% 9.20% 12.25% 8.05% 8.29%
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average
net assets........................... -- -- .49% .35% .40%
Ratio of net investment income to
average net assets................... 9.24% 8.90% 7.41% 7.00% 6.75%
Decrease reflected in above
expense ratios due to
undertakings by the Manager.......... 1.05% .92% .30% .42% .35%
Portfolio Turnover Rate................ 17.39% 25.46% 131.69% 225.52% 317.00%
Net Assets, end of year
(000's Omitted)...................... $31,970 $63,419 $144,215 $333,646 $551,543
See notes to financial statements.
</TABLE>
DREYFUS SHORT-INTERMEDIATE GOVERNMENT FUND
NOTES TO FINANCIAL STATEMENTS
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES:
The Fund is registered under the Investment Company Act of 1940 ("Act") as
a diversified open-end management investment company. Dreyfus Service
Corporation ("Distributor") acts as the exclusive distributor of the Fund's
shares, which are sold to the public without a sales charge. The Distributor
is a wholly-owned subsidiary of The Dreyfus Corporation ("Manager").
(A) PORTFOLIO VALUATION: The Fund's investments (excluding short-term
investments) are valued each business day by an independent pricing service
("Service") approved by the Board of Trustees. Investments for which quoted
bid prices in the judgment of the Service are readily available and are
representative of the bid side of the market are valued at the mean between
the quoted bid prices (as obtained by the Service from dealers in such
securities) and asked prices (as calculated by the Service based upon its
evaluation of the market for such securities). Other investments are carried
at fair value as determined by the Service, based on methods which include
consideration of: yields or prices of securities of comparable quality,
coupon, maturity and type; indications as to values from dealers; and general
market conditions. Short-term investments are carried at amortized cost, which
approximates value.
(B) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities transactions
are recorded on a trade date basis. Realized gain and loss from securities
transactions are recorded on the identified cost basis. Interest income
including, where applicable, amortization of discount on investments is
recognized on the accrual basis.
The Fund may enter into repurchase agreements with financial institutions,
deemed to be creditworthy by the Fund's Manager, subject to the seller's
agreement to repurchase and the Fund's agreement to resell such securities at
a mutually agreed upon price. Securities purchased subject to repurchase
agreements are deposited with the Fund's custodian and, pursuant to the terms
of the repurchase agreement, must have an aggregate market value greater than
or equal to the repurchase price plus accrued interest at all times. If the
value of the underlying securities falls below the value of the repurchase
price plus accrued interest, the Fund will require the seller to deposit
additional collateral by the next business day. If the request for additional
collateral is not met, or the seller defaults on its repurchase obligation,
the Fund maintains the right to sell the underlying securities at market value
and may claim any resulting loss against the seller.
(C) DIVIDENDS TO SHAREHOLDERS: It is the policy of the Fund to declare
dividends daily from investment income-net. Such dividends are paid monthly.
Dividends from net realized capital gain are normally declared and paid
annually, but the Fund may make distributions on a more frequent basis to
comply with the distribution requirements of the Internal Revenue Code. To the
extent that net realized capital gain can be offset by capital loss
carryovers, if any, it is the policy of the Fund not to distribute such gain.
On December 28, 1993, the Board of Trustees declared a cash dividend of
$.059 per share from net realized capital gain (including $.0395 per share
from short-term capital gain), payable on December 29, 1993 (ex-dividend
date), to shareholders of record as of the close of business on December 28,
1993.
(D) FEDERAL INCOME TAXES: It is the policy of the Fund to continue to
qualify as a regulated investment company, if such qualification is in the
best interests of its shareholders, by complying with provisions available to
certain investment companies, as defined in applicable sections of the
Internal Revenue Code, and to make distributions of taxable income sufficient
to relieve it from all, or substantially all, Federal income taxes.
DREYFUS SHORT-INTERMEDIATE GOVERNMENT FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE 2-MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES:
(A) Pursuant to a management agreement ("Agreement") with the Manager, the
management fee is computed at the annual rate of .50 of 1% of the average
daily value of the Fund's net assets and is payable monthly. The Agreement
provides for an expense reimbursement from the Manager should the Fund's
aggregate expenses, exclusive of taxes, interest on borrowings, brokerage and
extraordinary expenses, exceed 1 1/2% of the average value of the Fund's net
assets for any full fiscal year. However, the Manager had undertaken from
December 1, 1992 through November 30, 1993 to reduce the management fee paid
by the Fund, to the extent that the Fund's aggregate expenses (excluding
certain expenses as described above) exceeded specified annual percentages of
the Fund's average daily net assets. The reduction in management fee, pursuant
to the undertakings, amounted to $1,559,229 for the year ended November 30,
1993.
The Manager may modify the expense limitation percentages from time to
time, provided that the resulting expense reimbursement would not be less than
the amount required pursuant to the Agreement.
(B) Pursuant to the Fund's Shareholder Services Plan, the Fund reimburses
the Distributor an amount not to exceed an annual rate of .25 of 1% of the
value of the Fund's average daily net assets for servicing shareholder
accounts. The services provided may include personal services relating to
shareholder accounts, such as answering shareholder inquiries regarding the
Fund and providing reports and other information, and services related to the
maintenance of shareholder accounts. During the year ended November 30, 1993,
the Fund was charged an aggregate of $557,171 pursuant to the Shareholder
Services Plan.
(C) Certain officers and trustees of the Fund are "affiliated persons," as
defined in the Act, of the Manager and/or the Distributor. Each trustee who is
not an "affiliated person" receives an annual fee of $4,000 and an attendance
fee of $500 per meeting.
(D) On December 5, 1993, the Manager entered into an Agreement and Plan of
Merger providing for the merger of the Manager with a subsidiary of Mellon
Bank Corporation ("Mellon").
Upon closing of the merger, it is planned that the Manager will retain its
New York headquarters and will be a separate subsidiary within the Mellon
organization. It is expected that the Manager's management team and mutual
fund managers will remain in place, and the Dreyfus mutual funds will be
operated in the same manner as they are currently.
Following the merger, the Manager will be either a direct or indirect
subsidiary of Mellon, whose principal banking subsidiary is Mellon Bank, N.A.
Closing of this merger is subject to a number of contingencies, including the
receipt of certain regulatory approvals and the approvals of the stockholders
of the Manager and of Mellon. The merger is expected to occur in mid-1994, but
could occur significantly later.
Because the merger will constitute an "assignment" of the Fund's
Management Agreement with the Manager under the Investment Company Act of
1940, and thus a termination of such Agreement, the Manager will seek prior
approval from the Fund's Board and shareholders.
NOTE 3-SECURITIES TRANSACTIONS:
The aggregate amount of purchases and sales of investment securities,
other than short-term securities, during the year ended November 30, 1993,
amounted to $1,563,523,525 and $1,363,964,541, respectively.
At November 30, 1993, the cost of investments for Federal income tax
purposes was substantially the same as the cost for financial reporting
purposes (see the Statement of Investments).
DREYFUS SHORT-INTERMEDIATE GOVERNMENT FUND
IMPORTANT TAX INFORMATION (UNAUDITED)
For Federal Tax purposes the Fund hereby designates $.0230 per share as a
long-term capital gain distribution of the $.2740 per share paid on December
31, 1992.
DREYFUS SHORT-INTERMEDIATE GOVERNMENT FUND
REPORT OF ERNST & YOUNG, INDEPENDENT AUDITORS
SHAREHOLDERS AND BOARD OF TRUSTEES
DREYFUS SHORT-INTERMEDIATE GOVERNMENT FUND
We have audited the accompanying statement of assets and liabilities of
Dreyfus Short-Intermediate Government Fund, including the statement of
investments, as of November 30, 1993, and the related statement 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 financial highlights for each of
the years indicated therein. 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 November 30, 1993 by correspondence with the custodian and
brokers. 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
Dreyfus Short-Intermediate Government Fund at November 30, 1993, 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 indicated years, in conformity with generally accepted
accounting principles.
(Ernst and Young Signature)
New York, New York
January 7, 1994
(Dreyfus Lion Logo)
Short-Intermediate
Government
Fund
Annual Report
November 30, 1993
(Dreyfus Lion Logo)
DREYFUS SHORT-INTERMEDIATE
GOVERNMENT FUND
144 Glenn Curtiss Boulevard
Uniondale, NY 11556
MANAGER
The Dreyfus Corporation
200 Park Avenue
New York, NY 10166
DISTRIBUTOR
Dreyfus Service Corporation
200 Park Avenue
New York, NY 10166
CUSTODIAN
The Bank of New York
110 Washington Street
New York, NY 10286
TRANSFER AGENT &
DIVIDEND DISBURSING AGENT
The Shareholder Services Group, Inc.
P.O. Box 9671
Providence, RI 02940
Further information is contained in the Prospectus,
which must precede or accompany this report.
Printed in U.S.A. 542AR9311
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT
IN DREYFUS SHORT-INTERMEDIATE GOVERNMENT FUND
AND THE MERRILL LYNCH TREASURY MASTER INDEX - SHORT-TERM
EXHIBIT A:
_______________________________________________________
| | MERRILL LYNCH | DREYFUS |
| | TREASURY MASTER | SHORT-INTERMEDIATE |
| PERIOD | INDEX - | GOVERNMENT |
| | SHORT-TERM * | FUND |
|----------- | ------------------ | -------------------|
| 4/6/87 | 10,000 | 10,000 |
| 5/31/87 | 9,947 | 9,719 |
| 8/31/87 | 10,116 | 9,869 |
| 11/30/87 | 10,359 | 10,120 |
| 2/28/88 | 10,679 | 10,492 |
| 5/31/88 | 10,700 | 10,442 |
| 8/31/88 | 10,842 | 10,567 |
| 11/30/88 | 11,047 | 10,768 |
| 2/28/89 | 11,160 | 10,848 |
| 5/31/89 | 11,553 | 11,251 |
| 8/31/89 | 11,869 | 11,584 |
| 11/30/89 | 12,228 | 11,951 |
| 2/28/90 | 12,345 | 12,080 |
| 5/31/90 | 12,600 | 12,337 |
| 8/31/90 | 12,930 | 12,648 |
| 11/30/90 | 13,310 | 13,051 |
| 2/28/91 | 13,675 | 13,389 |
| 5/31/91 | 13,982 | 13,684 |
| 8/31/91 | 14,355 | 14,079 |
| 11/30/91 | 14,819 | 14,650 |
| 2/29/92 | 15,073 | 14,910 |
| 5/31/92 | 15,344 | 15,200 |
| 8/31/92 | 15,813 | 15,904 |
| 11/30/92 | 15,842 | 15,830 |
| 2/28/93 | 16,296 | 16,554 |
| 5/31/93 | 16,401 | 16,673 |
| 8/31/93 | 16,704 | 17,104 |
| 11/30/93 | 16,796 | 17,142 |
|___________ | __________________ | ___________________|
______________________________________________________
|DREYFUS SHORT-INTERMEDIATE GOVERNMENT FUND |
|------------------------------------------------------|
| AVERAGE ANNUAL TOTAL RETURNS |
| ENDED ON 11/30/93 |
|------------------------------------------------------|
| | | SINCE |
| 1 YEAR | 5 YEAR | INCEPTION |
| | | (4/6/87) |
|----------- | ------------------ | -------------------|
| 8.29% | 9.74% | 8.44%|
------------------------------------------------------|
