<PAGE>
Dreyfus
100% U.S. Treasury
Short Term Fund
Semi-Annual
Report
June 30, 1996
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Dreyfus 100% U.S. Treasury Short Term Fund
Letter to Shareholders
Dear Shareholder:
We are pleased to provide you with this report on the Dreyfus 100%
U.S. Treasury Short Term Fund. For its semi-annual reporting period ended
June 30, 1996, your Fund paid income dividends of approximately $.477 per
share, which is equivalent to an annualized distribution rate per share of
6.47%.* Total return, which includes price fluctuations, was .79% per
share.**
THE ECONOMY
So far this year, the economic story has been upbeat: solid growth,
strong gains in employment and low inflation. Yet along with this good news
has come the fear that the Federal Reserve Board (the "Fed") will tighten
monetary policy lest the continued economic expansion bring a resurgence in
inflation. The growth in the economy has resulted in strong gains in
employment. Over recent months, reports of the new jobs have been accompanied
by rises in long-term interest rates, a reflection of the market's concern
that inflation perceptions by the Fed would result in its acting to cool down
an economy that risks overheating. To date, the Fed has refrained from any
overt tightening moves. (The Fed cut rates three times between last July and
January of this year, and has since held the Federal Funds rate steady at
5.25%, even as long-term rates in the bond market have risen more than a full
percentage point.)
The interplay between job growth and economic growth has become the
dominant force affecting what investors think of the outlook for inflation
and the possibility that the Fed will raise short-term interest rates. Along
with handsome increases in new jobs have come solid gains in retail sales,
although many economists feel that heavy consumer debt burdens will act as a
constraint against any acceleration in growth. Automobile sales remain
strong, the third year in a row of steady growth for auto manufacturers. Yet,
what investors focus on and what concerns the Fed may be two different
things. On June 19, the Fed's Beige Book, a survey of business conditions in
the 12 districts of the Federal Reserve, reported that the economy was
growing at a moderate pace and that despite the tightening labor markets
"indications of rising wages remain scattered." Recent statements by
officials of the Federal Reserve Board have suggested that "sustained
moderate growth" is the most likely path for the economy and that labor
markets, while tightening, do not yet indicate significant inflationary
pressures.
There seem to be few signs of inflation. Commodity and producer
prices remain subdued. Anecdotal reports from companies continue to attest to
their lack of ability to raise prices. Another measure of potential
inflation, delivery lead times - one of Chairman Greenspan's favorite
indicators - has been little changed for months. Furthermore, some of the
inflationary consequences of running large budget deficits have eased due to
the growth in the economy. Higher than expected tax payments - a result of eco
nomic growth - have reduced the Federal budget deficit to the $130 billion
level, the lowest since the early 1980s.
Nevertheless, there are limits to non-inflationary economic
expansion. As always, we remain watchful for signs of price pressures that
could lead to a resurgence of inflation. For now, there are few indications
of that. In fact, there also appears to be a growing consensus that the rate
of economic growth could taper off in the second half of the year due to the
effect of higher long-term interest rates on certain key sectors of the
economy like housing and consumer spending.
MARKET ENVIRONMENT
The market currently is setting its prices in light of a raising of
rates by the Federal Reserve that it thinks imminent. This is a change of 180
degrees from last February, when the market was pricing in an imminent
lowering of rates. The market was wrong then, and could be wrong now. Markets
have a
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tendency to overshoot in the expectation of Federal Reserve moves or
policy shifts. In our opinion, the risks if one is short in this market,
exceed the reward. We are still positive about the bond market and following
are some of the reasons.
1) Commodity prices are below their highs, and are behaving well.
2) Cyclical stocks have been performing poorly. Among the S&P Group
Index returns, three of the groups that performed the worst from 12/29/95 to
7/19/96 were: S&P Truckers, -28.03%; S&P Homebuilding, -19.14%; and S&P Iron
& Steel, -18.28%.
3) Interest rates have risen by over 100 basis points this year, and
we have not seen the full effects of that yet.
4) The dollar is strong although it may have peaked.
5) Consumer debt has been rising while consumer confidence has been
falling.
6) The "wealth effect" (when consumers feel wealthier because of the
substantial growth in the market value of the equities they own but have not
cashed in) is not as high as it has been due to stock market volatility.
Clearly, when shareholders of equities receive their July statements, they
will not feel as great as they have in the past.
7) Asset allocators have been decreasing their equity holdings in
favor of either bonds, or cash.
THE PORTFOLIO
We have extended the portfolio back out to approximately 2.3 years at
the time of writing. The dollar-weighted average maturity of the Fund's
portfolio is expected to range between 2 and 3 years. We feel it is prudent
to be taking advantage of the higher yield currently in the market. We have
been selling expensively priced, shorter-dated paper and seeking to move to
securities that are more attractive.
Included in this report is a series of detailed statements about your
Fund's holdings and its financial condition. We hope they are informative.
Please know that we appreciate greatly your continued confidence in the Fund
and in The Dreyfus Corporation.
Very truly yours,
[Gerald E. Thunelius Signature]
Gerald E. Thunelius
Portfolio Manager
July 19, 1996
New York, N.Y.
* Annualized distribution rate per share is based upon dividends per share
paid from net investment income during the period, divided by the net asset
value per share at the end of the period.
** Total return includes reinvestment of dividends and any capital gains
paid.
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Dreyfus 100% U.S. Treasury Short Term Fund
Statement of Investments June 30, 1996 (Unaudited)
Principal
Bonds and Notes-102.7% Amount Value
- ---------------------------------------------- ----------- -----------
U.S. Treasury Bonds--4.3%
13-1/8%, 5/15/2001.. ...................... $ 5,850,000 $ 7,471,547
13-3/4%, 8/15/2004......................... 1,200,000 1,723,687
-----------
9,195,234
-----------
U.S. Treasury Notes--91.7%
6-7/8%, 10/31/1996......................... 7,600,000 7,635,625
6-1/8%, 5/31/1997.......................... 15,000,000 15,049,220
8-1/2%, 7/15/1997.......................... 19,850,000 20,369,512
5-5/8%, 10/31/1997......................... 8,000,000 7,967,500
5%, 1/31/1998.............................. 6,200,000 6,104,094
6%, 5/31/1998.............................. 34,000,000 33,930,939
6-1/4%, 6/30/1998.......................... 10,000,000 10,024,219
8-1/4%, 7/15/1998.......................... 3,000,000 3,119,062
6-3/8%, 5/15/1999.......................... 71,170,000 71,336,808
6-1/4%, 4/30/2001.......................... 2,500,000 2,476,563
8%, 5/15/2001.............................. 13,600,000 14,458,500
6-1/2%, 5/31/2001.......................... 5,000,000 5,002,344
-----------
197,474,386
-----------
U.S. Treasury Coupon Strips-6.7%
Zero Coupon, 2/15/1997..................... 15,000,000 14,495,669
-----------
TOTAL BONDS AND NOTES
(cost $222,003,604)........................ $221,165,289
------------
------------
Short-Term Investments-.5%
- ------------------------------------------------------------------------------
U.S. Treasury Bills:
5.14%, 10/17/1996.......................... $ 850,000 $ 836,715
5.11%, 10/24/1996.......................... 212,000 208,485
------------
TOTAL SHORT-TERM INVESTMENTS
(cost $1,045,430).......................... $ 1,045,200
------------
------------
TOTAL INVESTMENTS
(cost $223,049,034)........................ 103.2% $222,210,489
----- ------------
----- ------------
LIABILITIES, LESS CASH AND RECEIVABLES......... (3.2%) $ (6,940,377)
----- ------------
----- ------------
NET ASSETS..................................... 100.0% $215,270,112
----- -------------
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See independent accountants' review report and notes to financial statements.
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<TABLE>
<CAPTION>
Dreyfus 100% U.S. Treasury Short Term Fund
Statement of Assets and Liabilities June 30, 1996 (Unaudited)
<S> <C> <C>
ASSETS:
Investments in securities, at value
(cost $223,049,034)--see statement............................... $222,210,489
Cash............................................................... 396,731
Interest receivable................................................ 2,369,300
Receivable for shares of Beneficial Interest subscribed............ 930,376
Prepaid expenses................................................... 6,732
------------
225,913,628
LIABILITIES:
Due to The Dreyfus Corporation and affiliates...................... $ 52,447
Payable for investment securities purchased........................ 10,012,900
Payable for shares of Beneficial Interest redeemed................. 516,468
Accrued expenses................................................... 61,701 10,643,516
----------- ------------
NET ASSETS........................................................... $215,270,112
------------
------------
REPRESENTED BY:
Paid-in capital.................................................... $231,730,979
Accumulated undistributed investment income-net.................... 69,889
Accumulated net realized (loss) on investments..................... (15,692,211)
Accumulated net unrealized (depreciation) on investments-Note 4.... (838,545)
------------
NET ASSETS at value applicable to 14,569,792 shares outstanding
(unlimited number of $.001 par value shares of Beneficial
Interest authorized)............................................... $215,270,112
------------
------------
NET ASSET VALUE, offering and redemption price per share
($215,270,112 / 14,569,792 shares)................................. $14.78
------
------
See independent accountants' review report and notes to financial statements.
</TABLE>
<TABLE>
<CAPTION>
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Dreyfus 100% U.S. Treasury Short Term Fund
Statement of Operations six months ended June 30, 1996 (Unaudited)
<S> <C> <C>
INVESTMENT INCOME:
Interest Income............................................. $ 6,988,975
Expenses:
Management fee-Note 3(a).................................. $ 588,103
Shareholder servicing costs-Note 3(b)..................... 283,085
Professional fees......................................... 23,062
Registration fees......................................... 17,927
Trustees' fees and expenses-Note 3(c)..................... 17,691
Custodian fees-Note 3(b).................................. 11,887
Prospectus and shareholders' reports...................... 4,774
Miscellaneous............................................. 1,927
-----------
Total Expenses........................................ 948,456
Less-reduction in management fee due
to undertaking-Note 3(a)................................ 262,336
-----------
Net Expenses.......................................... 686,120
-----------
INVESTMENT INCOME-NET................................. 6,302,855
REALIZED AND UNREALIZED (LOSS) ON INVESTMENTS:
Net realized (loss) on investments-Note 4................... $(2,823,337)
Net unrealized (depreciation) on investments................ (1,970,021)
-----------
NET REALIZED AND UNREALIZED (LOSS) ON INVESTMENTS..... (4,793,358)
-----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS.......... $ 1,509,497
-----------
-----------
See independent accountants' review report and notes to financial statements.
</TABLE>
<TABLE>
<CAPTION>
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Dreyfus 100% U.S. Treasury Short Term Fund
Statement of Changes in Net Assets
Year Ended Six Months Ended
December 31, June 30, 1996
1995 (Unaudited)
------------ ---------------
<S> <C> <C>
OPERATIONS:
Investment income-net....................................................... $ 12,424,362 $ 6,302,855
Net realized gain (loss) on investments..................................... 756,726 (2,823,337)
Net unrealized appreciation (depreciation) on investments for the period.... 5,998,054 (1,970,021)
------------ ------------
Net Increase In Net Assets Resulting From Operations...................... 19,179,142 1,509,497
------------ ------------
DIVIDENDS TO SHAREHOLDERS FROM;
Investment income-net....................................................... (12,391,432) (6,299,110)
------------ ------------
BENEFICIAL INTEREST TRANSACTIONS:
Net proceeds from shares sold............................................... 82,806,129 71,881,363
Dividends reinvested........................................................ 8,752,599 4,685,072
Cost of shares redeemed..................................................... (82,176,313) (45,232,804)
------------ ------------
Increase In Net Assets From Beneficial
Interest Transactions................................................... 9,382,415 31,333,631
------------ ------------
Total Increase In Net Assets.......................................... 16,170,125 26,544,018
NET ASSETS:
Beginning of period......................................................... 172,555,969 188,726,094
------------ ------------
End of period (including undistributed investment income-net:
$66,144 in 1995 and $69,889 in 1996)...................................... $188,726,094 $215,270,112
------------ ------------
------------ ------------
Shares Shares
------------ ------------
CAPITAL SHARE TRANSACTIONS:
Shares sold................................................................. 5,545,332 4,823,189
Shares issued for dividends reinvested...................................... 586,742 314,798
Shares redeemed............................................................. (5,520,766) (3,035,019)
------------ ------------
Net Increase In Shares Outstanding........................................ 611,308 2,102,968
------------ ------------
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See independent accountants' review report and notes to financial statements.
</TABLE>
<TABLE>
<CAPTION>
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Dreyfus 100% U.S. Treasury Short Term 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 period indicated. This
information has been derived from the Fund's financial statements.
Six Months
Year Ended December 31, Ended
------------------------------------------ June 30, 1996
PER SHARE DATA: 1991 1992 1993 1994 1995 (Unaudited)
------ ------ ------ ------ ------ -----------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period.............. $15.40 $16.18 $15.91 $15.75 $14.55 $15.14
------ ------ ------ ------ ------ ------
Investment Operations:
Investment income-net............................. 1.13 1.35 1.25 1.15 1.03 .48
Net realized and unrealized gain (loss)
on investments.................................. .78 (.27) (.16) (1.20) .59 (.36)
------ ------ ------ ------ ------ ------
Total from Investment
Operations.................................... 1.91 1.08 1.09 (.05) 1.62 .12
------ ------ ------ ------ ------ ------
Distributions;
Dividends from investment
income-net...................................... (1.13) (1.35) (1.25) (1.15) (1.03) (.48)
------ ------ ------ ------ ------ ------
Net asset value, end of period.................... $16.18 $15.91 $15.75 $14.55 $15.14 $14.78
------ ------ ------ ------ ------ ------
------ ------ ------ ------ ------ ------
TOTAL INVESTMENT RETURN............................. 12.92% 7.01% 7.03% (.33%) 11.38% 1.58%(1)
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average
net assets...................................... - .03% .11% .35% .65% .70%(1)
Ratio of net investment income to
average net assets.............................. 8.60% 8.34% 7.82% 7.61% 6.90% 6.41%(1)
Decrease reflected in above expense
ratios due to undertakings
by the Manager (limited to the
expense limitation provision of
the management agreement)....................... 1.50% 1.09% .85% .59% .29% .27%(1)
Portfolio Turnover Rate........................... 59.59% 137.93% 322.62% 499.11% 480.44% 229.55%(2)
Net Assets, end of period
(000's Omitted)................................. $29,183 $144,058 $188,300 $172,556 $188,726 $215,270
<FN>
_____________________
(1) Annualized.
(2) Not annualized.
See independent acccountants' review report and notes to financial statements.
</TABLE>
<PAGE>
Dreyfus 100% U.S. Treasury Short Term Fund
NOTES TO FINANCIAL STATEMENTS (Unaudited)
NOTE 1-Significant Accounting Policies:
Dreyfus 100% U.S. Treasury Short Term Fund (the "Fund") is registered
under the Investment Company Act of 1940 ("Act") as a diversified open-end
management investment company. The Fund's investment objective is to provide
investors with as high a level of current income as is consistent with the
preservation of capital. The Dreyfus Corporation ("Manager") serves as the
Fund's investment adviser. The Manager is a direct subsidiary of Mellon Bank,
N.A. ("Mellon"). Premier Mutual Fund Services, Inc. (the "Distributor") acts
as the distributor of the Fund's shares, which are sold to the public without
a sales charge.
(a) Portfolio valuation: The Fund's investments are valued at the mean
between quoted bid and asked prices.
(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.
(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, it is the policy of the Fund not to distribute such gain.
(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 the applicable
provisions of the Internal Revenue Code, and to make distributions of taxable
income sufficient to relieve it from substantially all Federal income and
excise taxes.
The Fund has an unused capital loss carryover of approximately
$12,869,000 available for Federal income tax purposes to be applied against
future net securities profits, if any, realized subsequent to December 31,
1995. If not applied, $10,865,000 of the carryover expires in fiscal 2002 and
$2,004,000 of the carryover expires in fiscal 2003.
NOTE 2-Bank Line of Credit:
The Fund participates in a $100 million unsecured line of credit provided
by The Bank of New York, primarily for temporary or emergency purposes,
including the meeting of redemption requests that otherwise might require the
untimely disposition of securities. Interest is payable at the Federal Funds
rate plus .50% on an annualized basis. For the period ended June 30, 1996,
the Fund did not borrow under the line of credit.
NOTE 3-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 .60 of 1% of the value
of the Fund's average daily 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, brokerage, interest on borrowings and
extraordinary
<PAGE>
Dreyfus 100% U.S. Treasury Short Term Fund
NOTES TO FINANCIAL STATEMENTS (Unaudited) (continued)
expenses, exceed the expense limitation of any state having jurisdiction
over the Fund. The most stringent state expense limitation applicable to the
Fund presently requires reimbursement of expenses in any full year that such
expenses (exclusive of certain expenses as described above) exceed 2-1/2% of
the first $30 million, 2% of the next $70 million and 1-1/2% of the excess of
$100 million of the average value of the Fund's net assets in accordance with
California "blue sky" regulations. The Manager has undertaken from January 1,
1996 through December 31, 1996 to reduce the management fee paid by, or
reimburse such excess expenses of the Fund, to the extent that the Fund's
aggregate expenses (exclusive of certain expenses as described above) exceed
an annual rate of .70 of 1% of the value of the Fund's average daily net
assets. The reduction in management fee, pursuant to the undertaking,
amounted to $262,336 during the six months ended June 30, 1996.
The undertaking may be extended, modified or terminated by the Manager,
provided that the resulting expense reimbursement would be less than the
amount required pursuant to the Agreement.
(b) Pursuant to the Fund's Shareholder Services Plan, the Fund reimburses
Dreyfus Service Corporation, a wholly-owned subsidiary of the Manager, an
amount not to exceed an annual rate of .25 of 1% of the value of the Fund's
average daily net assets for certain allocated expenses of providing personal
services and/or maintaining 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 six months ended June 30, 1996, the Fund was charged an aggregate
of $196,131 pursuant to the Shareholder Services Plan.
The Fund compensates Dreyfus Transfer, Inc., a wholly-owned subsidiary of
the Manager, under a transfer agency agreement for providing personnel and
facilities to perform transfer agency services for the Fund. Such
compensation amounted to $57,576 during the six months ended June 30, 1996.
Effective May 10, 1996, the Fund entered into a Custody Agreement with
Mellon to provide custodial services for the Fund. During the period from May
10, 1996 through June 30, 1996, $2,094 was paid to Mellon pursuant to the
Custody Agreement.
(c) Each trustee who is not an "affiliated person" as defined in the Act
receives from the Fund an annual fee of $2,500 and an attendance fee of $250
per meeting. The Chairman of the Board receives an additional 25% of such
compensation.
NOTE 4-Securities Transactions:
The aggregate amount of purchases and sales of investment securities,
excluding short-term securities, during the six months ended June 30, 1996,
amounted to $432,916,973 and $376,350,221, respectively.
At June 30, 1996, accumulated net unrealized depreciation on investments
was $838,545, consisting of $447,110 gross unrealized appreciation and
$1,285,655 gross unrealized depreciation.
At June 30, 1996, 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).
<PAGE>
Dreyfus 100% U.S. Treasury Short Term Fund
Review Report of Ernst & Young LLP, Independent Accountants
Shareholders and Board of Trustees
Dreyfus 100% U.S. Treasury Short Term Fund
We have reviewed the accompanying statement of assets and
liabilities of Dreyfus 100% U.S. Treasury Short Term Fund, including the
statement of investments, as of June 30, 1996, and the related statements of
operations and changes in net assets and financial highlights for the six
month period ended June 30, 1996. These financial statements and financial
highlights are the responsibility of the Fund's management.
We conducted our review in accordance with standards established by
the American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures
to financial data, and making inquiries of persons responsible for financial
and accounting matters. It is substantially less in scope than an audit
conducted in accordance with generally accepted auditing standards, which
will be performed for the full year with the objective of expressing an
opinion regarding the financial statements and financial highlights taken as
a whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modification
that should be made to the interim financial statements and financial
highlights referred to above for them to be in conformity with generally
accepted accounting principles.
We have previously audited, in accordance with generally accepted
auditing standards, the statement of changes in net assets for the year ended
December 31, 1995 and financial highlights for each of the five years in the
period ended December 31, 1995 and in our report dated January 31, 1996, we
expressed an unqualified opinion on such statement of changes in net assets
and financial highlights.
[ERNST & YOUNG LLP SIGNATURE LOGO]
New York, New York
August 1, 1996
<PAGE>
Dreyfus 100% U.S. Treasury
Short Term Fund
200 Park Avenue
New York, NY 10166
Manager
The Dreyfus Corporation
200 Park Avenue
New York, NY 10166
Custodian
Mellon Bank, N.A.
One Mellon Bank Center
Pittsburgh, PA 15258
Transfer Agent &
Dividend Disbursing Agent
Dreyfus Transfer, Inc.
P.O. Box 9671
Providence, RI 02940
Printed in U.S.A. 081SA966
