DREYFUS MONEY MARKET RESERVES
LETTER TO SHAREHOLDERS
Dear Shareholder:
We are pleased to report that Dreyfus Money Market Reserves achieved
a strong performance in its latest semi-annual fiscal period, the six months
ended April 30, 1996.
The overall economy during these six months showed signs of firming
but no boom.
ECONOMIC ENVIRONMENT
SIGNS OF FIRMING
After many months of slow growth, the U.S. economy picked up its pace
in the closing months of the recent semi-annual reporting period. The first
sign was February's huge increase in payroll jobs, followed by upticks in
consumer income, spending and confidence.
While stepped-up consumer spending had not yet translated into
stronger factory output by the end of April, new factory orders did augur a
faster pace ahead - and not just for consumer goods, but for capital spending
and exports as well.
In fact, the catching up of production to increased demand and sales
growth should be a major force for economic acceleration over the next few
months.
.. . . BUT NO BOOM
Despite these obvious signs of vitality, there are convincing reasons
to believe that the current economic upswing will soon moderate. The bounce
back from the government shutdown, the end of the harsh winter weather and
the resolution of the General Motors strike, we believe, are all exaggerating
the economy's snapback. In addition, the recent rise in market interest rates
places an important limit on growth. It could take a worldwide commodity boom
to inspire the kind of aggressive inventory restocking last seen in 1994.
Finally, while capital spending remains robust, it has been growing
vigorously for three years, making a strong case for consolidation ahead.
INFLATION FEARS AND REALITY
Buffeted by the relentless climb in interest rates since early 1996,
investors are understandably concerned about renewed economic strength and
the potential for higher inflation ahead.
Yet, we believe, there are significant indications that the current
economic pace cannot be sustained. Beyond energy and grains, most industrial
commodity prices appear to be holding steady. Corporate profit growth also
appears to be slowing, encouraging companies to intensify, not lessen, their
quest for cost controls. Moreover, despite demands for higher wages, actual
settlements in recent years have remained fairly modest.
MARKET ENVIRONMENT
In January the Federal Reserve Board reduced short-term interest
rates slightly, based on perceptions that economic activity had slowed
considerably while inflation remained in check. This move reduced yields on
all short-term investments, including U.S. Treasury and other money market
securities. In February, a different picture began to emerge: data began to
indicate that the economy might be growing at a relatively rapid rate. Along
with this new information, short-term interest rates began to rise, although
at the close of the semi-annual period they were still lower than they had
been at the start of the period.
The economy's mixed signals have been somewhat unsettling for the
money market. Whereas the semi-annual period began with expectations that the
Federal Reserve Board would continue to ease short-term interest rates,
subsequent economic data left many people wondering if the Fed might actually
begin to raise rates instead.
PORTFOLIO OVERVIEW
During the six months ended April 30, 1996, the Fund once again
provided shareholders with a solid stream of income, while maintaining a high
quality portfolio along with a stable $1.00 share price. For this semi-annual
period, the Fund's annualized simple yield was 4.92% for its Investor shares
and 5.12% for its Class R shares. Reinvesting the Fund's dividends and
calculating the effect of compounding resulted in an annualized effective
yield of 5.03% for Investor shares and 5.24% for Class R shares.*
Although the Federal Reserve Board reduced interest rates in January,
the rates of money market securities reached their low point in February and
had actually risen 20 basis points by the end of April. To attempt to take
advantage of these rising rates and to bolster the Fund's income stream, the
Fund maintained a defensive posture during the period.
Our strategy included three main components. First, we maintained a
neutral average portfolio maturity of approximately 45 days. We also
"laddered" the maturities of our portfolio holdings from one to 120 days, so
that the Fund owned securities maturing at intervals throughout that range.
Securities with these maturities were among the highest-yielding money market
issues over the past six months. Finally, the Fund maintained a position of
approximately 25% in floating rate securities with maturities of one year or
less. Floating rate securities provide yields that reset daily, weekly,
monthly, or quarterly according to diversified money market indices.
Using this investment strategy enabled the Fund to maintain its
steady income stream while remaining flexible and ready to respond promptly
to interest rate changes. Looking ahead, we will continue to monitor interest
rates, the economy and the market very closely. We will continue to seek a
competitive level of income by investing in a well-diversified portfolio of
traditional money market instruments while concentrating on stability, high
quality and liquidity.
Sincerely,
[Roberta A. Shea signature logo]
Roberta A. Shea
Portfolio Manager
May 15, 1996
New York, N.Y.
*Annualized effective yield is based upon dividends declared daily and
reinvested monthly.
<TABLE>
<CAPTION>
DREYFUS MONEY MARKET RESERVES
STATEMENT OF INVESTMENTS APRIL 30, 1996(UNAUDITED)
PRINCIPAL
NEGOTIABLE BANK CERTIFICATES OF DEPOSIT-4.8% AMOUNT VALUE
_______________________ _____ ____
<S> <C> <C>
Bayerische Landesbank Girozentrale (Yankee)
6.73%, 3/3/97 (a)................................................ $ 7,000,000 $7,000,000
Bayerische Vereinsbank AG (Yankee)
5.25%, 2/27/97................................................... 7,000,000 7,000,000
Deutsche Bank AG (Yankee)
5.25%, 2/27/97................................................... 7,000,000 7,000,000
___
TOTAL NEGOTIABLE BANK CERTIFICATES OF DEPOSIT
(cost $21,000,000)............................................... $ 21,000,000
===
COMMERCIAL PAPER-60.5%
_______________________
Abbey National North America
5.57%, 5/28/96 .................................................. $ 4,000,000 $ 3,983,740
Akzo Nobel Inc.
5.41%, 7/11/96................................................... 7,500,000 7,421,013
Allianz Of America Finance Corp.
5.36%, 6/25/96................................................... 7,500,000 7,439,156
Allied-Signal Inc.
5.32%, 5/17/96................................................... 4,200,000 4,190,107
American Express Credit Corp.
5.37%, 8/30/96................................................... 4,000,000 3,929,282
Anheuser-Busch Companies Inc.
5.32%, 5/1/96.................................................... 10,000,000 10,000,000
Boc Group Inc, (DE)
5.37%, 5/1/96.................................................... 10,000,000 10,000,000
Bradford & Bingley Building Society
5.31%, 5/9/96.................................................... 3,000,000 2,996,467
Browning-Ferris Industries Inc.
5.35%, 5/1/96.................................................... 10,000,000 10,000,000
Caisse Centrale Desjardins Du Quebec
5.42%, 7/8/96.................................................... 3,000,000 2,969,683
Canadian Wheat Board
5.35%, 5/1/96.................................................... 9,350,000 9,350,000
Csr America Inc.
5.26%, 7/25/96................................................... 7,000,000 6,915,213
Daimler-Benz North America Corp.
5.07%, 6/26/96................................................... 2,000,000 1,984,507
Dairy Investments (Bermuda) Ltd.
5.42%, 6/3/96.................................................... 7,000,000 6,965,607
DuPont (E.I.) De Nemours & Co.
5.47%, 8/2/96.................................................... 5,000,000 4,931,800
EksportFinans A/S
5.14%-5.41%, 6/11/96-9/3/96...................................... 7,600,000 7,534,184
Electricite De France
5.09%, 5/15/96................................................... 6,000,000 5,988,263
DREYFUS MONEY MARKET RESERVES
STATEMENT OF INVESTMENTS (CONTINUED) APRIL 30, 1996 (UNAUDITED)
PRINCIPAL
COMMERCIAL PAPER (CONTINUED) AMOUNT VALUE
_______________________ _____ ____
Enel Commercial Paper Inc.
5.38%, 7/11/96................................................... $ 7,888,000 $ 7,805,445
Fleet Funding Inc.
5.33%, 5/31/96................................................... 7,045,000 7,013,885
Hewlett-Packard Co.
5.15%, 7/19/96................................................... 7,000,000 6,922,426
Hitachi America Ltd.
5.26%, 7/26/96................................................... 7,000,000 6,914,382
International Lease Finance Corp.
5.34%, 6/21/96................................................... 7,000,000 6,947,739
Koch Industries Inc.
5.35%, 5/1/96.................................................... 10,000,000 10,000,000
Liberty Mutual Capital Corp.
5.37%, 5/15/96................................................... 7,500,000 7,484,425
Merrill Lynch & Co. Inc.
5.35%-5.40%, 5/15/96-8/23/96..................................... 7,500,000 7,388,835
Monsanto Co.
5.35%, 5/23/96................................................... 7,000,000 6,977,328
Morgan Stanley Group Inc.
5.20%, 8/2/96.................................................... 7,300,000 7,204,577
National Australia Funding (DE) Inc.
5.55%, 5/29/96................................................... 5,000,000 4,979,000
Nestle Capital Corp.
5.35%, 5/1/96.................................................... 10,000,000 10,000,000
Petrofina (DE) Inc.
5.12%, 5/14/96................................................... 7,000,000 6,987,209
Potomac Electric Power Co.
5.31%, 5/6/96.................................................... 5,375,000 5,371,043
Quebec (Province of)
5.42%, 7/10/96................................................... 7,000,000 6,927,181
Saint-Gobain (Compagnie DE) S.A.
5.35%, 5/13/96................................................... 5,000,000 4,991,133
Sandoz Corp.
5.15%-5.21%, 5/1/96-5/23/96...................................... 7,000,000 6,990,678
Svenska Handelsbanken Inc.
5.16%, 5/3/96.................................................... 7,200,000 7,197,960
Toyota Motor Credit Corp.
5.37%, 5/7/96.................................................... 1,245,000 1,243,890
UBS Finance (DE) Inc.
5.35%, 5/1/96.................................................... 10,000,000 10,000,000
Unilever Capital Corp.
5.35%, 5/1/96.................................................... 10,000,000 10,000,000
USAA Capital Corp.
5.07%, 6/27/96................................................... 6,000,000 5,952,785
Weyerhaeuser Mortgage Co.
5.38%, 5/7/96.................................................... 4,000,000 3,996,433
___
TOTAL COMMERCIAL PAPER
(cost $265,895,376).............................................. $265,895,376
===
DREYFUS MONEY MARKET RESERVES
STATEMENT OF INVESTMENTS (CONTINUED) APRIL 30, 1996 (UNAUDITED)
PRINCIPAL
CORPORATE NOTES-9.8% AMOUNT VALUE
_______________________ ____ ____
Abbey National Treasury Services PLC
5.41%, 2/21/97 (a)............................................... $ 3,000,000 $ 2,998,544
Bear Stearns Companies Inc.
5.53%, 6/12/96 (a)............................................... 6,000,000 6,000,000
Bear Stearns Ser B Mtn
5.40%, 8/5/96 (a)............................................... 9,000,000 9,000,000
Boatmens Bank
5.47%, 6/12/96 (a)............................................... 5,000,000 5,000,000
Boatmen First Stn
5.48%, 6/12/96 (a)................................................ 10,000,000 10,000,000
IBM Credit Corp.
5.42%, 4/14/97 (a)............................................... 3,000,000 3,008,440
National Rural Utilities
5.49%, 9/15/96 (a)............................................... 2,000,000 2,000,488
Norwest Corp
5.44%, 5/23/96 (a)............................................... 5,000,000 5,000,078
___
TOTAL CORPORATE NOTES
(cost $43,007,550)............................................... $ 43,007,550
===
SHORT-TERM BANK NOTES-5.5%
_______________________
First National Bank of Chicago
5.35%, 3/12/97 (a)............................................... $ 7,000,000 $ 6,997,040
PNC Bank N.A.
5.50%, 8/12/96 (a)............................................... 10,000,000 9,998,360
Wachovia Bank of North Carolina
5.40%, 3/25/97 (a)............................................... 7,000,000 6,994,792
___
TOTAL SHORT TERM BANK NOTES
(cost $23,990,192)............................................... $ 23,990,192
===
U.S GOVERNMENT AGENCIES-2.2%
_______________________
Federal Home Loan Banks, Floating Rate Notes
5.31%, 3/14/97 (a)............................................... $ 5,000,000 $ 5,000,000
5.37%, 3/27/97 (a)............................................... 5,000,000 4,995,816
___
TOTAL U.S. GOVERNMENT AGENCIES
(cost $9,995,816)................................................ $ 9,995,816
===
TIME DEPOSITS-2.3%
_______________________
Society National Bank of Cleveland (Grand Cayman)
5.38%,5/1/96
(cost $10,000,000)............................................... $10,000,000 $ 10,000,000
===
DREYFUS MONEY MARKET RESERVES
STATEMENT OF INVESTMENTS (CONTINUED) APRIL 30, 1996 (UNAUDITED)
PRINCIPAL
REPURCHASE AGREEMENTS-14.9% AMOUNT VALUE
________________________ ________
Lehman Government Securities, Inc.
Dated 4/30/96, due 5/1/96 in the amount
of $65,476,656 (fully collateralized by
$45,580,000 U.S. Treasury Notes, 11.25%,
due 2/15/15, value $67,004,948)
(cost $65,467,000)............................................... $65,467,000 $ 65,467,000
=============
TOTAL INVESTMENTS
(cost $439,355,934)............................... 100.0% $439,355,934
======= =============
CASHANDRECEIVABLES(NET) .................................. .0% $ 17,478
======= =============
NET ASSETS ............................................... 100.0% $439,373,412
======= =============
NOTE TO STATEMENT OF INVESTMENTS;
(a) Variable interest rate-subject to periodic change.
See notes to financial statements.
DREYFUS MONEY MARKET RESERVES
STATEMENT OF ASSETS AND LIABILITIES APRIL 30, 1996 (UNAUDITED)
ASSETS:
Investments in securities, at value (cost $439,355,934)-see Statement of
Investments (including repurchase agreements of $65,467,000).......... $439,355,934
Cash.................................................................... 399,754
Interest receivable..................................................... 520,062
______________
440,275,750
LIABILITIES:
Due to The Dreyfus Corporation-Note 2(a)................................ $277,166
Due to Distributor...................................................... 23,006
Dividends payable....................................................... 576,291
Directors' fees and expenses-Note 2 (c)................................. 25,875 902,338
_________ _____________
_
NET ASSETS.................................................................. $439,373,412
==============
REPRESENTEDBY:
Paid-in capital......................................................... $439,383,209
Accumulated net realized (loss) on investments ......................... (9,797)
______________
NET ASSETS at value......................................................... $439,373,412
==============
NET ASSET VALUE, offering and redemption price per share:
Investor Shares
(2 billion shares of $.001 par value Capital Stock authorized)
($140,643,405 3 140,648,697 shares of Capital Stock outstanding)...... $1.00
=====
Class R Shares
(2 billion shares of $.001 par value Capital Stock authorized)
($298,730,0073 298,734,512 shares of Capital Stock outstanding)....... $1.00
=====
See notes to financial statements.
DREYFUS MONEY MARKET RESERVES
STATEMENT OF OPERATIONS SIX MONTHS ENDED APRIL 30, 1996 (UNAUDITED)
INVESTMENT INCOME:
INTEREST INCOME......................................................... $8,832,845
EXPENSES:
Investment management fee-Note 2(a)................................... $769,414
Distribution fee (Investor shares)-Note 2(b).......................... 141,701
Directors' fees and expenses-Note 2(c)................................ 15,702
_________
TOTAL EXPENSES.................................................... 926,817
_________
INVESTMENT INCOME-NET ...................................................... 7,906,028
NET REALIZED GAIN ON INVESTMENTS............................................ 1,081
_________
NETINCREASEINNETASSETSRESULTINGFROMOPERATIONS............................... $7,907,109
=========
See notes to financial statements.
DREYFUS MONEY MARKET RESERVES
STATEMENT OF CHANGES IN NET ASSETS
SIX MONTHS ENDED YEAR ENDED
APRIL 30,1996 OCTOBER 31,
(UNAUDITED) 1995
__________________ ______________
OPERATIONS:
Investment income-net................................................ $ 7,906,028 $ 16,314,763
Net realized gain (loss) on investments.............................. 1,081 (10,878)
_______________ ___________
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS............. 7,907,109 16,303,885
_______________ ___________
DIVIDENDS TO SHAREHOLDERS FROM:
Investment income_net:
Investor Shares.................................................... (3,503,008) (9,095,601)
Class R Shares..................................................... (4,403,020) (7,219,162)
_______________ ___________
TOTAL DIVIDENDS.................................................. (7,906,028) (16,314,763)
_______________ ___________
CAPITAL STOCK TRANSACTIONS ($1.00 per share):
Net proceeds from shares sold:
Investor Shares.................................................... 80,898,512 314,697,956
Class R Shares..................................................... 551,909,478 225,926,525
Issued in exchange for shares of Dreyfus/Laurel Cash Management Fund;
Investor Shares.................................................... - 209,866,862
Dividends reinvested:
Investor Shares.................................................... 3,454,092 8,003,722
Class R Shares..................................................... 2,596,758 4,593,646
Cost of shares redeemed:
Investor Shares.................................................... (105,528,924) (374,354,965)
Class R Shares..................................................... (395,563,713) (215,481,690)
_______________ ___________
INCREASE IN NET ASSETS FROM CAPITAL STOCK TRANSACTIONS........... 137,766,203 173,252,056
_______________ ___________
TOTAL INCREASE IN NET ASSETS................................... 137,767,284 173,241,178
NET ASSETS:
Beginning of period.................................................. 301,606,128 128,364,950
_______________ ___________
End of period........................................................ $ 439,373,412 $ 301,606,128
=============== ===========
</TABLE>
See notes to financial statements.
DREYFUS MONEY MARKET RESERVES
FINANCIAL HIGHLIGHTS
Contained below is per share performance data for a share of Capital
Stock 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.
<TABLE>
<CAPTION>
INVESTOR SHARES
_______________________________________________________
SIX MONTHS ENDED YEAR ENDED OCTOBER 31,
APRIL 30, 1996 ____________________________
PER SHARE DATA: (UNAUDITED) 1995 1994(1)(2)
__________ _______ ________
<S> <C> <C> <C>
Net asset value, beginning of period.............. $ 1.00 $ 1.00 $ 1.00
______ ______ ______
INVESTMENT OPERATIONS;
Investment income-net............................. .025 .052 .021
______ ______ ______
DISTRIBUTIONS;
Dividends from investment income-net.............. (.025) (.052) (.021)
______ ______ ______
Net asset value, end of period.................... $ 1.00 $ 1.00 $ 1.00
====== ====== ======
TOTAL INVESTMENT RETURN............................... 4.97%(3) 5.28% 2.14%
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets........... .70%(3) .70% .71%(3)
Ratio of net investment income to average net assets 4.93%(3) 5.25% 3.31%(3)
Net Assets, end of period (000's Omitted)......... $140,643 $161,819 $3,611
_____
(1) The Fund commenced selling Investor shares on April 6, 1994.
(2) Effective October 17, 1994, The Dreyfus Corporation serves as the Fund's
investment mananger. Prior to October 17, 1994, Mellon Bank, N.A. served as
the Fund's investment manager.
(3) Annualized.
</TABLE>
See notes to financial statements.
DREYFUS MONEY MARKET RESERVES
FINANCIAL HIGHLIGHTS (CONTINUED)
Contained below is per share performance data for a share of Capital
Stock 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.
<TABLE>
<CAPTION>
CLASS R SHARES
_____________________________________________________________________
SIX MONTHS ENDED YEAR ENDED OCTOBER 31,
APRIL 30, 1996 _____________________________________________________
PER SHARE DATA: (UNAUDITED) 1995 1994(1)(2) 1993 1992 1991
___ __ __ __ __ __
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning
of period............... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
______ ______ ______ ______ ______ ______
INVESTMENT OPERATIONS;'
Investment income-net..... .026 .053 .034(3) .028 .039 .062
______ ______ ______ ______ ______ ______
DISTRIBUTIONS;
Dividends from investment
income-net.............. (.026) (.053) (.034) (.028) (.039) (.062)
______ ______ ______ ______ ______ ______
Net asset value, end of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
______ ______ ______ ______ ______ ______
______ ______ ______ ______ ______ ______
TOTAL INVESTMENT RETURN....... 5.17%(4) 5.44% 3.52% 2.84% 3.92% 6.39%
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average
net assets.............. .50%(4) .50% .51%(5) .50%(6) .50%(6) .50%(6)
Ratio of net investment income
to average net assets... 5.10%(4) 5.40% 3.51%(5) 2.80%(6) 3.88%(6) 6.13%(6)
Net Assets, end of period
(000's Omitted)......... $298,730 $139,787 $124,754 $103,760 $91,848 $105,329
______
(1) Effective October 17, 1994, The Dreyfus Corporation serves as the Fund's
investment manager. Prior to October 17, 1994, Mellon Bank, N.A. served as
the Fund's investment manager.
(2) The Fund commenced selling Investor shares on April 6, 1994. Those
shares outstanding prior to April 4, 1994 were redesignated as Trust shares.
Effective October 17, 1994, the Fund's Trust shares were reclassified as Class R shares.
3) Net investment income before expenses reimbursed by the investment adviser for the year ended October 31, 1994 was $0.0331.
(4) Annualized.
(5) Annualized expense ratio before expenses reimbursed by the investment adviser for the year ended October 31, 1994 was 0.64%.
(6) For the years or period ended October 31, 1992 and 1991, the investment adviser waived all or a portion of its advisory fee
amounting to $.0007 and $.0010 per share, respectively. For the years or
period ended October 31, 1993, 1992 and 1991, the investment adviser
reimbursed expenses of the Fund amounting to $.0036, $.0027 and $.0018 per
share, respectively.
</TABLE>
See notes to financial statements.
DREYFUS MONEY MARKET RESERVES
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES:
The Dreyfus/Laurel Funds, Inc. (the "Company") is registered under the
Investment Company Act of 1940 ("Act") as a diversified open-end management
investment company and operates as a series company currently offering
seventeen series including the Dreyfus Money Market Reserves (the "Fund").
The Fund's investment objective is to seek a high level of current income
consistent with stability of principal by investing in high-grade money
market instruments. The Dreyfus Corporation ("Manager") serves as the Fund's
investment adviser. The Manager is a direct subsidiary of Mellon Bank, N.A.
("Mellon Bank").
Premier Mutual Fund Services, Inc. (the "Distributor") acts as the
distributor of the Fund's shares. The Fund is currently authorized to issue
two classes of shares: Investor shares and Class R shares. Investor shares
are sold primarily to retail investors and bear a distribution fee. Class R
shares are sold primarily to bank trust departments and other financial
service providers (including Mellon Bank and its affiliates) acting on behalf
of customers having a qualified trust or investment account or relationship
at such institution, and bear no distribution fee. Each class of shares has
identical rights and privileges, except with respect to the distribution fee
and voting rights on matters affecting a single class.
Investment income, net of expenses (other than class specific expenses),
realized and unrealized gains and losses are allocated daily to each class of
shares based upon the relative proportion of net assets of each class.
(A) PORTFOLIO VALUATION: Investments are valued at amortized cost in
accordance with Rule 2a-7 of the Investment Company Act of 1940, which has
been determined by the Fund's Board of Directors to represent the fair value
of the Fund's investments.
It is the Fund's policy to maintain a continuous net asset value per
share of $1.00 for the Fund; the Fund has adopted certain investment,
portfolio valuation and dividend and distribution policies to enable it to do
so. There is no assurance, however, that the Fund will be able to maintain a
stable net asset value of $1.00.
(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 is recognized on the accrual basis. Cost of investments represents
amortized cost.
(C) REPURCHASE AGREEMENTS: The Fund may engage in repurchase agreement
transactions. Under the terms of a typical repurchase agreement, the Fund,
through its custodian and sub-custodian, takes possession of an underlying
debt obligation subject to an obligation of the seller to repurchase, and the
Fund to resell, the obligation at an agreed-upon price and time, thereby
determining the yield during the Fund's holding period. This arrangement
results in a fixed rate of return that is not subject to market fluctuations
during the Fund's holding period. The value of the collateral is at least
equal, at all times, to the total amount of the repurchase obligation,
including interest. In the event of a counterparty default, the Fund has the
right to use the collateral to offset losses incurred. There is potential
loss to the Fund in the event the Fund is delayed or prevented from
exercising its rights to dispose of the collateral securities,
DREYFUS MONEY MARKET RESERVES
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
including the risk of a possible decline in the value of the underlying
securities during the period while the Fund seeks to assert its rights. The
Fund's manager, acting under the supervision of the Board of Directors,
reviews the value of the collateral and the creditworthiness of those banks
and dealers with which the Fund enters into repurchase agreements to evaluate
potential risks.
(D) DISTRIBUTIONS 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.
(E) 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 $11,000
available for Federal income tax purposes to be applied against future net
securities profits, if any, realized subsequent to October 31, 1995. If not
applied, the carryover expires in fiscal 2003.
At April 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).
NOTE 2 - INVESTMENT MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES:
(A) INVESTMENT MANAGEMENT FEE: Pursuant to an Investment Management
agreement with the Manager, the Manager provides or arranges for one or more
third parties and/or affiliates to provide investment advisory,
administrative, custody, fund accounting and transfer agency services to the
Fund. The Manager also directs the investments of the Fund in accordance with
its investment objective, policies and limitations. For these services, the
Fund is contractually obligated to pay the Manager a fee, calculated daily
and paid monthly, at the annual rate of .50% of the value of the Fund's
average daily net assets. Out of its fee, the Manager pays all of the
expenses of the Fund except brokerage fees, taxes, interest, Rule 12b-1
distribution fees and expenses, fees and expenses of non-interested Directors
(including counsel fees) and extraordinary expenses. In addition, the Manager
is required to reduce its fee in an amount equal to the Fund's allocable
portion of fees and expenses of the non-interested Directors (including
counsel).
(B) DISTRIBUTION PLAN: The Fund has adopted a distribution plan (the
"Plan") pursuant to Rule 12b-1 under the 1940 Act relating to its Investor
shares. Under the Plan, the Fund may pay annually up to .25% of the value of
the average daily net assets attributable to its Investor shares to
compensate the Distributor and Dreyfus Service Corporation, an affiliate of
the Manager, for shareholder servicing activities and the Distributor for
activities primarily intended to result in the sale of Investor shares. The
Class R shares bear no distribution fee. For the six months ended April 30,
1996, the distribution fee for the Investor shares was $141,701.
DREYFUS MONEY MARKET RESERVES
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
Under its terms, the Plan shall remain in effect from year to year,
provided such continuance is approved annually by a vote of majority of those
Directors who are not "interested persons" of the Company and who have no
direct or indirect financial interest in the operation of the Plan or in any
agreement related to the Plan.
(C) DIRECTOR'S FEES: Each director who is not an "interested person" as
defined in the Act receives $27,000 per year, $1,000 for each Board meeting
attended and $750 for each Audit Committee meeting attended and is reimbursed
for travel and out-of-pocket expenses. These expenses are paid in total by
the following funds: The Dreyfus/Laurel Funds, Inc., The Dreyfus/Laurel
Tax-Free Municipal Funds, and The Dreyfus/Laurel Funds Trust. In addition
the Chairman of the Board receives an annual fee of $75,000 per year. These
fees and expenses are charged and allocated to each series based on net
assets.
[Dreyfus lion "d" logo]
DREYFUS MONEY MARKET RESERVES
200 Park Avenue
New York, NY 10166
MANAGER
The Dreyfus Corporation
200 Park Avenue
New York, NY 10166
CUSTODIAN
Mellon Bank
One Mellon Bank Center
Pittsburgh, PA 15258
TRANSFER AGENT &
DIVIDEND DISBURSING AGENT
Dreyfus Transfer, Inc.
One American Express Plaza
Providence, RI 02903
Further information is contained in the Prospectus,
which must precede or accompany this report.
Printed in U.S.A. 317/717SA964
[Dreyfus logo]
Money Market
Reserves
Semi-Annual
Report
April 30, 1996
