THE TREASURER'S FUND
19 OLD KINGS HIGHWAY SOUTH
DARIEN, CT 06820
1 (800) TSR-FUND / 1 (800) 877-3863
ANNUAL REPORT
October 31,1996
INVESTMENT ADVISOR
- ------------------
GABELLI-O'CONNOR FIXED INCOME MUTUAL FUNDS MANAGEMENT CO.
19 Old Kings Highway South
Darien, CT 06820
ADMINISTRATOR
- -------------
FURMAN SELZ LLC
230 Park Avenue
New York, NY 10169
DISTRIBUTOR
- -----------
GOC FUND DISTRIBUTORS, INC.
19 Old Kings Highway South
Darien, CT 06820
CUSTODIAN
- ---------
CUSTODIAL TRUST COMPANY
101 Carnegie Center
Princeton, NJ 08540
LEGAL COUNSEL
- -------------
BATTLE FOWLER LLP
75 East 55th Street
New York, NY 10022
INDEPENDENT AUDITORS
- --------------------
ERNST & YOUNG LLP
787 7th Avenue
New York, NY 10019
This report is for the information of the shareholders of The Treasurer's Fund.
Its use in connection with any offering of the Fund's shares is authorized only
in case of a concurrent or prior delivery of the Fund's current prospectus.
<PAGE>
THE TREASURER'S FUND
December 16, 1996
Dear Fellow Shareholder:
We are pleased to present the annual report for The Treasurer's Fund for
the fiscal year ended October 31, 1996. The total net assets of The Treasurer's
Fund portfolios on October 31, 1996 (in millions) were:
Domestic Prime Money Market Portfolio $236.8
Tax Exempt Money Market Portfolio 158.5
U.S. Treasury Money Market Portfolio 90.8
-----
$486.1
The portfolios continue to hold investments in very high quality money
market securities of domestic, corporate and municipal issuers and U.S.
Government obligations. The weighted average maturities of the portfolios were
well within the permitted maximum of 90 days as stated below:
Domestic Prime Money Market Portfolio 30 days
Tax Exempt Money Market Portfolio 21 days
U.S. Treasury Money Market Portfolio 42 days
After reaching an interim low yield of 6.35% on November 29, the 30 year
Treasury bond has steadily deteriorated since, and now stands at a yield of
6.68%. Indeed, there has been a spate of stronger than expected news as of late,
but most of the sell-off can be directly traced to Chairman Greenspan's remarks
equating the current market exuberance with the Japanese markets of several
years back. Even though his remarks were reinterpreted the next day, many
believe that his true intention was to begin a process of letting some air out
of the "speculative bubble". In retrospect and as we believed, the market ran
too far too fast and a near term easing was needed to justify the previous price
action. So the market has begun its correction, a correction we believe was
needed and is healthy.
On the economic front we have seen continued resilience by the U.S.
consumer. By all accounts holiday sales have been strong. Of course, the final
tally for the season won't come in until next year. Housing starts have risen
strongly, showing a 9.2% increase for the month of November. Could it be that
the lower rates seen this fall have driven some to refinance thus adding to the
holiday cheer? Another troubling sign on the inflation front has been the price
of crude oil which has recently moved up strongly to over $25/barrel.
Interestingly enough this time we have not heard any screams from the general
populous concerning the price of gasoline at the pump. Concurrently, we've seen
producer prices up stronger than expected and consumer prices in check.
Our market opinion has not changed and continues to be positive for the
near future (the next 3 months). Where we thought the market was over priced
several weeks back, we have now started to extend the portfolio with these
relatively cheap prices. We believe the 30 year bond will continue to trade in a
well defined range with 6.625% representing value. With many predicting a
further correction in stocks we believe that short fixed income securities will
continue to have a strong underlying bid.
Sincerely,
/s/ Ronald S. Eaker
--------------------------------------
Ronald S. Eaker
President and Chief Investment Officer
The Domestic Prime Money Market Portfolio, Tax Exempt Money Market Portfolio,
and U.S. Treasury Money Market Portfolio attempt to maintain a stable net asset
value per share of $1.00. There can be no assurance that the Portfolios will be
successful in this regard.
Past performance is not indicative of future results.
Investments in the Portfolios are not insured, nor guaranteed, by the U.S.
Government.
<PAGE>
THE TREASURER'S FUND
DOMESTIC PRIME MONEY MARKET PORTFOLIO
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1996
<TABLE>
<CAPTION>
YIELD TO
MATURITY
CREDIT AT TIME OF MATURITY PRINCIPAL VALUE
RATINGS* PURCHASE DATE AMOUNT (NOTE 1A)
-------- ---------- ------ ------- --------
<S> <C> <C> <C> <C> <C>
COMMERCIAL PAPER - 51.5%
First Credit Corp., 5.28%....................... A1/P1 5.392% 11/07/96 $10,500,000 $ 10,490,760
International Lease Finance Corp., 5.37% (a).... A1/P1/D1+ 5.505 11/07/96 10,000,000 9,991,050
Avnet, Inc., 5.41%.............................. A1/P1 5.551 11/18/96 10,000,000 9,974,453
MCI Communications Corp., 5.25%................. A1/P1 5.363 11/18/96 10,500,000 10,473,969
National Fleet Funding Corp., 5.25%............. A1/P1 5.363 11/19/96 10,500,000 10,472,437
B.I. Funding, Inc., 5.26% (a)................... A1/NR/D1+ 5.371 11/20/96 10,000,000 9,972,239
American Trading & Production Corp., 5.43%...... A1/P1 5.582 11/21/96 9,000,000 8,972,850
Alamo Funding L.P., 5.28%....................... A1/P1 5.393 11/25/96 10,000,000 9,964,800
Transamerica Financial Corp., 5.24% (a)......... A1/P1/D1 5.351 11/25/96 10,000,000 9,965,067
First Chicago Capital Markets, Inc., 5.27%...... A1/P1 5.392 12/04/96 10,500,000 10,449,276
First Brands Commercial, Inc., 5.27............. A1/P1 5.405 12/10/96 11,000,000 10,937,199
Island Finance Puerto Rico, Inc., 5.35% (a)(b).. A1+/P1/F1+/D1+ 5.514 01/09/97 10,300,000 10,194,382
-----------
TOTAL COMMERCIAL PAPER ....................................................................................... 121,858,482
-----------
ADJUSTABLE RATE SECURITIES - 2.7%
Health Insurance Plan of Greater New York ACES,
Series 1990B-1, (07/01/16)**.................. A1+/NR 5.541 05/01/96 6,300,000 6,300,000
-----------
TOTAL ADJUSTABLE RATE SECURITIES .............................................................................. 6,300,000
-----------
U.S TREASURY ISSUES - 12.0%
U.S. Treasury Bills................................................. 4.877 02/06/97 6,000,000 5,925,957
U.S. Treasury Bills................................................. 4.974 02/06/97 6,000,000 5,924,502
U.S. Treasury Bills................................................. 5.027 02/06/97 6,000,000 5,923,693
U.S. Treasury Bills................................................. 5.185 03/06/97 6,000,000 5,898,958
U.S. Treasury Bills................................................. 5.667 07/24/97 5,000,000 4,805,483
-----------
TOTAL U.S. TREASURY ISSUES .................................................................................... 28,478,593
-----------
LOAN PARTICIPATIONS - 4.4%
Pacific Financial Asset Management, 5.44% (2)... NR/NR 5.531 11/06/96 10,500,000 10,500,000
-----------
TOTAL LOAN PARTICIPATIONS ..................................................................................... 10,500,000
-----------
See accompanying notes to financial statements
2
</TABLE>
<PAGE>
THE TREASURER'S FUND
DOMESTIC PRIME MONEY MARKET PORTFOLIO
PORTFOLIO OF INVESTMENTS (CONTINUED)
OCTOBER 31, 1996
<TABLE>
<CAPTION>
YIELD TO
MATURITY
AT TIME OF MATURITY PRINCIPAL VALUE
PURCHASE DATE AMOUNT (NOTE 1A)
---------- ------ ------- --------
<S> <C> <C> <C> <C>
REPURCHASE AGREEMENTS - 29.5%
Bear Stearns & Co., Inc. dated 10/31/96.............................. 5.570% 11/01/96 $24,973,970 $24,973,970
(Proceeds at maturity, $24,977,834) collateralized by:
$6,240,000 U.S. Treasury STRIPS 02/15/10 vs. $2,589,600
$43,000,000 U.S. Treasury STRIPS 02/15/15 vs. $12,416,250
$1,075,000 FHLMC Pool #C80427, 7.500% 09/01/26 vs. $1,084,857
$4,025,000 FHLMC Pool #G00399, 8.500% 09/01/25 vs. $3,187,232
$5,000,000 FHLMC REMIC, 4.0625%, 03/15/03 vs. $320,684
$1,500,000 FNMA REMIC Trust, 7.600%, 06/25/08 vs. $1,327,165
$79,080,165 FHLMC, 3.412% 12/15/22 vs. $2,369,838
$35,907,051 FHLMC, 4.012% 04/15/22 vs. $1,620,678
$750,000 FNMA REMIC Trust, 11.681%, 02/25/22 vs. $556,693
$1,200 U.S. Treasury STRIPS 05/15/10 vs. $489
Nomura Securities International, Inc., dated 10/31/96................ 5.520 11/01/96 45,000,000 45,000,000
(Proceeds at maturity, $45,006,900) collateralized by:
$36,685,000 FHLB Bonds, 6.070%, 07/02/97 vs. $36,685,000
$9,235,000 FNMA Notes, 5.250%, 03/25/98 vs. $9,223,456
------------
TOTAL REPURCHASE AGREEMENTS ..................................................................................... 69,973,970
------------
TOTAL INVESTMENTS--100.1% (COST $237,111,045)+ .................................................................. $237,111,045
============
*,**,+,(a),(2) See Footnotes to Portfolios
See accompanying notes to financial statements
3
</TABLE>
<PAGE>
THE TREASURER'S FUND
TAX EXEMPT MONEY MARKET PORTFOLIO
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1996
<TABLE>
<CAPTION>
CREDIT CURRENT MATURITY PRINCIPAL VALUE
RATINGS* COUPON DATE AMOUNT (NOTE 1A)
-------- ---------- ------ ------- --------
<S> <C> <C> <C> <C> <C>
SHORT-TERM MUNICIPAL SECURITIES - 98.7%
ALABAMA - 2.2%
Huntsville IDR TENR #66, Series 1982 (Avco Corporation
Project) (LOC Bankers Trust) (11/01/99)**.................. Aa2/NR 4.000% 11/07/96 $2,000,000 $ 2,000,000
Phenix County, IDB Environmental Improvement Revenue
(Mead Coated Board Project) (LOC Toronto Dominion Bank)
(06/01/28)**............................................... NR/A1+ 3.700 11/01/96 1,500,000 1,500,000
-----------
TOTAL ALABAMA 3,500,000
-----------
ARIZONA - 2.5%
Arizona HFAR, Series 1985 (Pooled Loan Program) (FGIC)
(10/01/15)**............................................... VMIG1/A1 3.550 11/07/96 500,000 500,000
Chandler IDA (SMP II Limited Partnership Project) (LOC
Credit Lyonnais & Republic National Bank, NY) (12/01/15)**. VMIG1/NR 3.600 11/07/96 1,500,000 1,500,000
Pima County IDA, Series 1982 A, (Tucson Electric Power Co.
Project) (LOC Bank of America) (07/01/22)**................ VMIG1/A1 3.550 11/07/96 2,000,000 2,000,000
-----------
TOTAL ARIZONA 4,000,000
-----------
CONNECTICUT - 1.9%
Connecticut Special Assessment Unemployment Compensation
Advance Fund Revenue Bond, Series C 1993 (SPA FGIC)
(FGIC) (11/15/01)***(b).................................... VMIG1/A1+/F1+ 3.900 07/01/97 3,000,000 3,000,000
-----------
FLORIDA - 4.0%
Dade County Water & Sewer System Revenue,
Series 1994 (FGIC) (SPA Commerzbank Aktiengesel)
(10/05/22)**............................................... VMIG1/A1 3.500 11/07/96 2,500,000 2,500,000
Indian Trace Community Development District (Basin I Water
Management Project) (LOC Tokai Bank, Ltd.) (05/01/10)**.... VMIG1/A2 3.500 11/07/96 3,900,000 3,900,000
-----------
TOTAL FLORIDA 6,400,000
-----------
GEORGIA - 12.0%
Burke County Development Authority, 5th Series (Georgia Power
Co. Vogtle Project) (07/01/24)**........................... VMIG1/A1+ 3.650 11/01/96 3,100,000 3,100,000
Burke County Development Authority, 5th Series (Georgia Power
Co. Vogtle Project) (07/01/24)****......................... VMIG1/A1+ 3.250 11/05/96 1,150,000 1,150,000
Burke County Development Authority, 5th Series (Georgia Power
Co. Vogtle Project) (07/01/24)****........................ P1/A1+ 3.600 01/09/97 5,000,000 5,000,000
Burke County Development Authority PCR (Oglethorpe
Power Corp. Project) (FGIC) (SPA Canadian Imperial
Bank) (01/01/16)**......................................... VMIG1/A1+ 3.500 11/07/96 1,700,000 1,700,000
Cobb County GO TANS, Series 1996.............................. MIG1/SP1+ 4.000 12/31/96 5,000,000 5,003,992
DeKalb County Private Hospital Authority (LOC Trust Company
Bank) (03/01/24)**......................................... VMIG1/A1+ 3.500 11/07/96 1,700,000 1,700,000
Hapeville Development Authority IDR (Hapeville Hotel
L.P. Project) (LOC Union Bank of Switzerland) (11/01/15)**. P1/NR 3.550 11/01/96 1,300,000 1,300,000
-----------
TOTAL GEORGIA 18,953,992
-----------
See accompanying notes to financial statements
4
</TABLE>
<PAGE>
THE TREASURER'S FUND
TAX EXEMPT MONEY MARKET PORTFOLIO
PORTFOLIO OF INVESTMENTS (continued)
OCTOBER 31, 1996
<TABLE>
<CAPTION>
CREDIT CURRENT MATURITY PRINCIPAL VALUE
RATINGS* COUPON DATE AMOUNT (NOTE 1A)
-------- ---------- ------ ------- --------
<S> <C> <C> <C> <C> <C>
SHORT-TERM MUNICIPAL SECURITIES (CONTINUED)
ILLINOIS - 6.6%
Illinois HFAR, Series E (Hospital Sisters Service)
(MBIA) (SPA Morgan Guaranty Trust) (12/01/15)**............ VMIG1/AAA 3.500% 11/07/96 $2,600,000 $ 2,600,000
Illinois State Toll Highway Authority, Series B (MBIA)
(LOC Societe Generale) (01/01/10)**(b)..................... VMIG1/A1+/F1+ 3.500 11/07/96 7,900,000 7,900,000
-----------
TOTAL ILLINOIS 10,500,000
-----------
KANSAS - 5.0%
Burlington PCR (Kansas City Power & Light Co. Project)
(LOC Toronto Dominion Bank) (10/01/17)****................. P1/A1+ 3.600 11/13/96 2,600,000 2,600,000
Burlington PCR (Kansas City Power & Light Co. Project)
(LOC Toronto Dominion Bank) (10/01/17)****................. P1/A1+ 3.500 12/04/96 2,000,000 2,000,000
Burlington PCR (Kansas City Power & Light Co. Project)
(LOC Toronto Dominion Bank) (10/01/17)****................. P1/A1+ 3.650 01/23/97 3,250,000 3,250,000
-----------
TOTAL KANSAS 7,850,000
-----------
KENTUCKY - 1.8%
Ohio County PCR, (Big Rivers Electric Corporation Project)
(LOC Chemical Bank) (10/01/15)**........................... NR/NR 4.150 11/07/96 2,900,000 2,900,000
-----------
LOUISIANA - 3.5%
East Baton Rouge Parish PCR Refunding Bonds, Series 1989
(LOC Union Bank of Switzerland) (11/01/19)**............... P1/A1+ 3.550 11/01/96 1,100,000 1,100,000
Louisiana State GO Bonds, Series A (LOC Credit
Local de France) (07/01/03)****............................ VMIG1/A1+ 3.400 12/02/96 4,500,000 4,500,000
-----------
TOTAL LOUISIANA 5,600,000
-----------
MASSACHUSETTS - 0.6%
State of Massachusetts Updates GO Revenue Bonds, Series E
(LOC ABN-AMRO Bank, NY) (12/01/97)**....................... VMIG1/A1+ 3.600 11/01/96 1,000,000 1,000,000
-----------
MICHIGAN - 2.2%
State of Michigan Building Authority (University of Michigan
Adult General Hospital) (12/01/04)***...................... Aaa/AAA 7.875 12/01/96 2,000,000 2,046,728
Wayne Charter County Airport Revenue (Detroit Metropolitan
County Project-B) (10/01/16)***............................ NR/A1+ 3.650 12/01/96 1,500,000 1,500,000
-----------
TOTAL MICHIGAN 3,546,728
-----------
MINNESOTA - 1.1%
Rochester Health Care, Series F (Mayo Foundation/
Mayo Medical Center Project) (SPA Credit Suisse)
(11/15/17)****............................................. NR/A1+ 3.650 01/16/97 1,800,000 1,800,000
-----------
NEBRASKA - 1.9%
Lancaster County Hospital Authority Revenue (Bryan Memorial
Hospital Project) (MBIA) (SPA Commerzbank Aktiengesel)
(06/01/12)**............................................... VMIG1/A1+ 3.500 11/07/96 3,000,000 3,000,000
-----------
See accompanying notes to financial statements
5
</TABLE>
<PAGE>
THE TREASURER'S FUND
TAX EXEMPT MONEY MARKET PORTFOLIO
PORTFOLIO OF INVESTMENTS (continued)
OCTOBER 31, 1996
<TABLE>
<CAPTION>
CREDIT CURRENT MATURITY PRINCIPAL VALUE
RATINGS* COUPON DATE AMOUNT (NOTE 1A)
-------- ---------- ------ ------- --------
<S> <C> <C> <C> <C> <C>
SHORT-TERM MUNICIPAL SECURITIES (CONTINUED)
NEW YORK - 11.5%
Babylon IDA Resource Recovery (Ogden Corporation)
(OFS Equity Babylon Project) (LOC Union Bank of
Switzerland) (12/01/24)**.................................. NR/A1+ 3.650% 11/01/96 $6,400,000 $ 6,400,000
New York City GO Bonds Fiscal 1994, Series A - A8 (LOC Union
Bank of Switzerland) (08/01/17)**.......................... VMIG1/A1+ 3.550 11/01/96 1,300,000 1,300,000
New York City GO Bonds Fiscal 1994, Series B, Subseries B4
(MBIA) (LIQ National Westminster Bank PLC) (08/15/23)**.... VMIG1/A1+ 3.550 11/01/96 1,000,000 1,000,000
New York City Municipal Water Finance Authority & Sewer
System Revenue, 1992 Series C (FGIC) (06/15/22)**.......... VMIG1/A1+ 3.550 11/01/96 3,400,000 3,400,000
New York City Municipal Water Finance Authority & Sewer
System Revenue, 1994 Series C (FGIC) (06/15/23)**.......... VMIG1/A1+ 3.550 11/01/96 1,100,000 1,100,000
State of New York Dormitory Authority (Beverwyck, Inc. Project)
(LOC Banque Paribas) (07/01/25)**.......................... VMIG1/A2 3.600 11/07/96 1,000,000 1,000,000
State of New York Energy Resh. & Development Authority
PCR (New York State Electric & Gas Co. Project) (LOC
Morgan Guaranty Trust) (06/01/29)**........................ VMIG1/A1+ 3.500 11/01/96 2,700,000 2,700,000
State of New York Job Development Authority, Series B-1 - B-21
(GTD State of New York) (03/01/05)**....................... VMIG1/NR 3.800 11/01/96 1,280,000 1,280,000
-----------
TOTAL NEW YORK 18,180,000
-----------
NORTH CAROLINA - 3.6%
Charlotte Airport Refunding Revenue Bonds, Series 1993 A
(MBIA) (SPA Commerzbank Aktiengesel) (07/01/16)**.......... VMIG1/A1+ 3.500 11/07/96 3,850,000 3,850,000
Lenoir County PCR TENR #60, Series 1983 (Texasgulf, Inc.
Project) (LOC Bankers Trust Co.) (12/01/03)**.............. Aa2/NR 3.625 11/07/96 1,000,000 1,000,000
Wake County Industrial Facilities & PCR Financing Authority
(Carolina Power & Light Co. Project)
(LOC Sumitomo Bank, Ltd.) (02/01/17)**..................... P1/NR 3.700 11/01/96 900,000 900,000
-----------
TOTAL NORTH CAROLINA 5,750,000
-----------
OHIO - 0.6%
Ohio State Student Loan Funding Corp., Cincinnati, OH,
Series A-2 (LOC National Westminster Bank PLC) (01/01/07)** VMIG1/NR 3.650 11/07/96 900,000 900,000
-----------
PENNSYLVANIA - 10.2%
Berks County IDR (Sixth & Penn Street Project)
(LOC Meridian Bank) (11/23/03)**........................... VMIG1/NR 3.600 11/07/96 1,240,000 1,240,000
Delaware Valley Regional Financing (LOC Midland Bank PLC)
(08/01/16)**.............................................. VMIG1/A1 3.650 11/07/96 2,700,000 2,700,000
Montgomery County IDA PCR, Series 1994-A (PECO Energy
Project) (LOC Deutsche Bank) (06/01/29)****................ P1/A1+ 3.600 11/04/96 3,760,000 3,760,000
Montgomery County IDA PCR, Series 1994-A (PECO Energy
Project) (LOC Deutsche Bank) (06/01/29)****................ P1/A1+ 3.200 11/13/96 3,500,000 3,500,000
Montgomery County IDA PCR, Series 1994-A (PECO Energy
Project) (LOC Deutsche Bank) (06/01/29)****................ P1/A1+ 3.200 11/14/96 3,500,000 3,500,000
State of Pennsylvania Energy Development Authority Revenue
Bonds, Series 1986 (Ebensburg Project) (LOC Swiss Bank
Corp.) (12/01/11)**........................................ Aa1/NR 3.600 11/07/96 1,400,000 1,400,000
-----------
TOTAL PENNSYLVANIA 16,100,000
-----------
See accompanying notes to financial statements
6
</TABLE>
<PAGE>
THE TREASURER'S FUND
TAX EXEMPT MONEY MARKET PORTFOLIO
PORTFOLIO OF INVESTMENTS (continued)
OCTOBER 31, 1996
<TABLE>
<CAPTION>
CREDIT CURRENT MATURITY PRINCIPAL VALUE
RATINGS* COUPON DATE AMOUNT (NOTE 1A)
-------- ---------- ------ ------- --------
<S> <C> <C> <C> <C> <C>
SHORT-TERM MUNICIPAL SECURITIES (CONTINUED)
TENNESSEE - 4.2%
Clarksville Public Authority Pooled Financing,
Series 1990 (MBIA) (SBPA Credit Suisse) (07/01/13)**....... VMIG1/A1+ 3.500% 11/07/96 $ 700,000 $ 700,000
Metropolitan Nashville Airport Authority, Series A
(American Airlines Project) (LOC Credit Suisse)
(10/01/12)**............................................... NR/A1 3.650 11/01/96 2,200,000 2,200,000
State of Tennessee BANS, Series A (07/02/01)**................ NR/A1+ 3.450 11/07/96 3,800,000 3,800,000
-----------
TOTAL TENNESSEE 6,700,000
-----------
TEXAS - 10.9%
Brazos River Harbor Navigation District, Series
1990 (Dow Chemical Co. Project) (01/01/16)****............. P1/A1 3.650 02/11/97 1,000,000 1,000,000
Harris County Health Facilities Development Corp.
(Memorial Hospital System) (LOC Societe Generale)
(06/01/24)****............................................. VMIG1/NR 3.650 01/14/97 2,400,000 2,400,000
Harris County HFC MFHR (Idlewood Park Project)
(GTD New England Mutual Life Insurance Co.)
(06/01/05)**............................................... NR/A1 3.600 11/07/96 2,750,000 2,750,000
Panhandle Plains Higher Education Authority, Inc.,
Student Loan Revenue, Series A (LOC SLMA)
(06/01/21)**............................................... VMIG1/NR 3.600 11/07/96 2,000,000 2,000,000
Panhandle Plains Higher Education Authority, Inc.,
Student Loan Revenue, Series A (LOC SLMA)
(06/01/25)**............................................... VMIG1/NR 3.600 11/07/96 4,300,000 4,300,000
San Antonio HFC, Multifamily Housing REV.,
Series 1990 (Eagles' Nest Apartments Project)
(LOC Landesbank Hessen) (05/01/20)**....................... NR/A1+ 3.600 11/07/96 4,800,000 4,800,000
-----------
TOTAL TEXAS 17,250,000
-----------
UTAH - 1.3%
Tooele County Hazardous Waste Treatment Revenue
(Westinghouse Electric Corp. Project A) (LOC Union Bank of
Switzerland) (06/01/20)****................................ NR/A1+ 3.550 12/05/96 2,000,000 2,000,000
-----------
VIRGINIA - 1.8%
Alexandria IDA Resource Recovery Revenue, Series 1986 A
(Ogden Corp. Project) (LOC Swiss Bank) (12/01/16)**........ VMIG1/A1+ 3.650 11/01/96 1,300,000 1,300,000
Peninsula Ports Authority Coal Terminal Revenue (Dominion
Terminal Project - C) (LOC National Westminster Bank)
(07/01/16)**............................................... P1/NR 3.600 11/01/96 1,500,000 1,500,000
-----------
TOTAL VIRGINIA 2,800,000
-----------
See accompanying notes to financial statements
7
</TABLE>
<PAGE>
THE TREASURER'S FUND
TAX EXEMPT MONEY MARKET PORTFOLIO
PORTFOLIO OF INVESTMENTS (continued)
OCTOBER 31, 1996
<TABLE>
<CAPTION>
CREDIT CURRENT MATURITY PRINCIPAL VALUE
RATINGS* COUPON DATE AMOUNT (NOTE 1A)
-------- ---------- ------ ------- --------
<S> <C> <C> <C> <C> <C>
SHORT-TERM MUNICIPAL SECURITIES (CONTINUED)
WYOMING - 9.3%
Lincoln County PCR (Pacificorp Project) (LOC Union Bank of
Switzerland) (01/01/16)****................................ VMIG1/A1+ 3.300% 11/21/96 $3,800,000 $ 3,800,000
Lincoln County PCR (Pacificorp Project) (LOC Union Bank of
Switzerland) (01/01/16)****................................ VMIG1/A1+ 3.500 01/22/97 1,500,000 1,500,000
Lincoln County PCR, Series B (Exxon Corp. Project)
(07/01/17)**............................................... P1/A1+ 3.650 11/01/96 1,100,000 1,100,000
Lincoln County PCR, Series A (Exxon Corp. Project)
(07/01/17)**............................................... P1/A1+ 3.650 11/01/96 1,200,000 1,200,000
Platte County PCR Refunding Bonds (Tri-State Generator &
Transmission Project) (LOC Societe Generale) (07/01/14)**.. P1/NR 3.600 11/01/96 2,000,000 2,000,000
Platte County PCR Refunding Bonds, Series 1984A
(07/01/14)****............................................. P1/NR 3.250 11/04/96 2,500,000 2,500,000
Platte County PCR Refunding Bonds, Series 1984B
(07/01/14)****............................................. P1/NR 3.600 11/06/96 1,800,000 1,800,000
Platte County PCR Refunding Bonds, Series 1984B
(Tri-State Generator & Transmission Project)
(LOC Societe Generale) (07/01/14)**........................ P1/NR 3.600 11/01/96 800,000 800,000
------------
TOTAL WYOMING 14,700,000
------------
TOTAL INVESTMENTS--98.7% (COST $156,430,720)+ ................................................................. $156,430,720
============
*,**,***,****,+,(b) See Footnotes to Portfolios
See accompanying notes to financial statements
8
</TABLE>
<PAGE>
THE TREASURER'S FUND
U.S. TREASURY MONEY MARKET PORTFOLIO
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1996
<TABLE>
<CAPTION>
YIELD TO
MATURITY
AT TIME OF MATURITY PRINCIPAL VALUE
PURCHASE DATE AMOUNT (NOTE 1A)
----------- -------- ---------- -----------
<S> <C> <C> <C> <C>
U.S. GOVERNMENT ISSUES - 52.3%
U S. Treasury Bills................................................... 5.133% 01/02/97 $ 4,000,000 $ 3,965,693
U.S. Treasury Bills................................................... 5.128 01/09/97 10,000,000 9,904,550
U.S. Treasury Bills++................................................. 5.122 01/09/97 10,000,000 9,904,646
U.S. Treasury Bills++................................................. 5.128 01/16/97 15,000,000 14,842,300
U.S. Treasury Bills................................................... 5.164 01/30/97 5,000,000 4,937,312
U.S. Treasury Bills++................................................. 5.196 03/06/97 4,000,000 3,932,500
----------
TOTAL U.S. GOVERNMENT ISSUES .................................................................................. 47,487,001
----------
REPURCHASE AGREEMENTS - 48.0%
Bear Stearns & Co., Inc. dated 10/31/96............................... 5.570 11/01/96 17,525,353 17,525,353
(Proceeds at maturity $17,528,064) collateralized by:
$47,090,000 U.S. Treasury STRIPS, 11/15/14 vs. $13,832,688
$15,082,100 U.S. Treasury STRIPS, 11/15/15 vs. $4,124,049
Nomura Securities International Inc. dated 10/31/96................... 5.520 11/01/96 18,000,000 18,000,000
(Proceeds at maturity $18,002,760) collateralized by:
$17,980,000 U.S. Treasury Notes 6.120%, 12/31/96 vs. $18,362,075
UBS Securities, Inc. dated 10/31/96................................... 5.500 11/01/96 8,000,000 8,000,000
(Proceeds at maturity $8,001,222) collateralized by:
$5,041,000 U.S. Treasury Notes 13.250%, 05/15/14 vs. $8,160,119
-----------
TOTAL REPURCHASE AGREEMENTS .................................................................................... 43,525,353
-----------
TOTAL INVESTMENTS--100.3% (COST $91,012,354)+................................................................... $91,012,354
===========
+ See Footnotes to Portfolios
++ Securities partially on loan to Bear Stearns & Co., Inc.; collateralized by
U.S. Government securities at a market value of $21,680,783 as of October
31, 1996.
See accompanying notes to financial statements
9
</TABLE>
<PAGE>
THE TREASURER'S FUND
FOOTNOTES TO PORTFOLIOS
*CREDIT RATINGS GIVEN BY STANDARD AND POOR'S CORPORATION & MOODY'S INVESTORS
SERVICE INC. (UNAUDITED)
<TABLE>
<CAPTION>
STANDARD & POOR'S MOODY'S
- ----------------- -----------
<S> <C> <C>
A1 P1 Instrument of the highest quality.
AAA Aaa Instrument judged to be of the best quality and carrying the smallest amount of
investment risk.
AA Aa Instrument judged to be of high quality by all standards.
SP1 MIG1/VMIG1 Instrument judged to be of the best quality with strong protection.
SP2 MIG2/VMIG2 Instrument judged to be of high quality with ample protection.
NR NR Not Rated. In the opinion of the Investment Advisor, instrument judged to be of comparable
investment quality to rated securities which may be purchased by the Portfolios.
</TABLE>
(A) Rated D1 by Duff & Phelps, Inc. (highest quality). (unaudited)
(B) Rated F1 by Fitch Investors Service, Inc. (highest quality). (unaudited)
Items which possess the strongest investment attributes of their category
are given that letter rating followed by a number. Duff & Phelps, Inc., Fitch
Investors Service, Inc. and Standard & Poor's ratings may be modified by the
addition of a plus or minus sign to show relative standing within the major
rating categories.
U.S. Government Issues have an assumed rating of AAA/Aaa.
ABBREVIATIONS USED IN THESE STATEMENTS:
<TABLE>
<CAPTION>
<S> <C>
ACES.........................Adjustable Convertible Extendable Securities
BANS ........................Bond Anticipation Notes
FGIC ........................Insured as to principal and interest by the Financial Guaranty Insurance Corp.
FHLB.........................Federal Home Loan Bank
FHLMC........................Federal Home Loan Mortgage Corp.
FNMA.........................Federal National Mortgage Association
GO...........................General Obligation
GTD .........................Guaranteed(1)
HFAR ........................Health Facilities Authority Revenue
HFC .........................Housing Finance Corporation
IDA .........................Industrial Development Authority
IDB..........................Industrial Development Board
IDR .........................Industrial Development Revenue
LIQ..........................Liquidity Facility Agreement
LOC..........................Letter of Credit(1)
MBIA ........................Insured as to principal and interest by the Municipal Bond Insurance Association
MFHR ........................Multi-Family Housing Revenue
PCR .........................Pollution Control Revenue
REMIC........................Real Estate Mortgage Investment Conduit
REV .........................Revenue
SBPA ........................Stand-by Purchase Agreement(1)
SLMA.........................Student Loan Marketing Association
STRIPS ......................Prestripped zero coupon bond that is a direct obligation of the U.S. Treasury
SPA .........................Securities Purchase Agreement(1)
TANS.........................Tax Anticipation Notes
TENR ........................Tax Exempt Note Rate
See accompanying notes to financial statements
10
</TABLE>
<PAGE>
THE TREASURER'S FUND
FOOTNOTES TO PORTFOLIOS (CONTINUED)
(1) Institutions shown in parenthesis have entered into credit support
agreements with the issuer.
(2) Institutions shown in parenthesis are the issuers of the participation
interests of those specific holdings.
** Variable/Floating Rate Demand Note. "Maturity Date" shown is next exercise
date of demand feature and "Yield to Maturity at Time of Purchase"/
"Current Coupon" is the rate in effect on October 31, 1996. Date in
parenthesis is the final maturity date of the issue.
*** Adjustable Rate Security. "Maturity Date" shown is next coupon reset date
and and "Yield to Maturity at Time of Purchase" / "Current Coupon" is the
rate in effect on October 31, 1996. Date in parenthesis is the final
maturity date of the issue.
**** Tax-Free Commercial Paper. Date in parenthesis is the final maturity of an
issue which has been remarketed in short-term interest periods ending on
date shown in maturity date column.
+ Cost basis for book and tax purposes is substantially the same.
INVESTMENT PERCENTAGES SHOWN ARE CALCULATED AS A PERCENTAGE OF NET ASSETS.
See accompanying notes to financial statements
11
<PAGE>
THE TREASURER'S FUND
STATEMENT OF ASSETS AND LIABILITIES
OCTOBER 31, 1996
<TABLE>
<CAPTION>
DOMESTIC PRIME TAX EXEMPT U.S. TREASURY
MONEY MARKET MONEY MARKET MONEY MARKET
PORTFOLIO PORTFOLIO PORTFOLIO
------------- ------------ ------------
<S> <C> <C> <C>
ASSETS:
Investments, in securities, at value (identified cost--$237,111,045*,
$156,430,720, and $91,012,354*, respectively) .............................. $ 237,111,045 $ 156,430,720 $ 91,012,354
Cash .......................................................................... 136,132 1,543,600 58,156
Interest receivable ........................................................... 43,165 766,634 6,694
Receivable for fund shares sold ............................................... 8,450 -- --
Other assets .................................................................. 7,261 6,238 16,500
------------- ------------- -------------
Total assets ............................................................ 237,306,053 158,747,192 91,093,704
------------- ------------- -------------
LIABILITIES:
Dividend payable .............................................................. 344,813 132,203 89,678
Payable for fund shares redeemed .............................................. 109 1,614 171,633
Advisory fee payable (note 2) ................................................. 59,566 40,523 23,303
Administrative services fee payable (note 2) .................................. 19,855 13,508 7,768
Fund accounting and shareholder servicing fees payable (note 2) ............... 8,676 6,148 4,224
Accrued expenses payable and other liabilities ................................ 61,394 46,262 35,636
------------- ------------- -------------
Total liabilities ....................................................... 494,413 240,258 332,242
------------- ------------- -------------
NET ASSETS .................................................................... $ 236,811,640 $ 158,506,934 $ 90,761,462
============= ============= =============
NET ASSETS CONSIST OF:
Shares of beneficial interest outstanding (par value of $0.001 per share);
2,000,000,000 shares authorized per Portfolio (note 3) ..................... $ 236,700 $ 158,558 $ 90,761
Additional paid-in capital .................................................... 236,463,101 158,399,648 90,670,701
Undistributed net investment income ........................................... -- 3,430 --
Distributions in excess of net investment income .............................. (11,680) -- --
Accumulated net realized gain (loss) on investments ........................... 123,519 (54,702) --
------------- ------------- -------------
NET ASSETS APPLICABLE TO OUTSTANDING SHARES ................................... $ 236,811,640 $ 158,506,934 $ 90,761,462
============= ============= =============
SHARES OF BENEFICIAL INTEREST OUTSTANDING ..................................... 236,699,801 158,558,206 90,761,462
============= ============= =============
NET ASSET VALUE PER SHARE OUTSTANDING ......................................... $ 1.00 $ 1.00 $ 1.00
============= ============= =============
* Includes Repurchase Agreements of $69,973,970 and $43,525,353 for the
Domestic Prime Money Market Portfolio and U.S. Treasury Money Market
Portfolio, respectively.
See accompanying notes to financial statements
12
</TABLE>
<PAGE>
THE TREASURER'S FUND
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED OCTOBER 31, 1996
<TABLE>
<CAPTION>
DOMESTIC PRIME TAX EXEMPT U.S. TREASURY
MONEY MARKET MONEY MARKET MONEY MARKET
PORTFOLIO PORTFOLIO PORTFOLIO
------------ ------------ ------------
<S> <C> <C> <C>
INTEREST INCOME .................................................. $ 11,965,370 $ 5,340,685 $ 4,662,127
------------ ------------ ------------
EXPENSES:
Advisory (note 2) .............................................. 657,103 455,634 263,957
Administrative services (note 2) ............................... 218,993 151,851 87,971
Custody ........................................................ 64,225 15,795 18,102
Shareholder services (note 2) .................................. 37,005 19,598 12,641
Fund accounting (note 2) ....................................... 31,589 37,463 31,122
Auditing ....................................................... 25,000 25,020 25,000
Interest (note 7) .............................................. 22,865 -- --
Legal .......................................................... 19,714 14,049 8,620
Registration ................................................... 17,268 17,268 16,034
Directors' fees and expenses ................................... 15,004 15,003 14,587
Reports to shareholders ........................................ 14,626 8,964 3,630
Miscellaneous .................................................. 58,574 36,860 51,452
------------ ------------ ------------
1,181,966 797,505 533,116
Less--Fund expenses waived by Administrator (note 2) ............. (20,122) (7,713) (5,202)
------------ ------------ ------------
Total expenses ................................................... 1,161,844 789,792 527,914
------------ ------------ ------------
NET INVESTMENT INCOME ............................................ 10,803,526 4,550,893 4,134,213
NET REALIZED GAIN ON SECURITIES .................................. 390,740 11,161 30,689
------------ ------------ ------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS ............. $ 11,194,266 $ 4,562,054 $ 4,164,902
============ ============ ============
See accompanying notes to financial statements
13
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
THE TREASURER'S FUND
STATEMENT OF CHANGES IN NET ASSETS
DOMESTIC PRIME TAX EXEMPT U.S. TREASURY
MONEY MARKET PORTFOLIO MONEY MARKET PORTMONEY MARKET PORTFOLIO
--------------------------- ---------------------------- ----------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31,
1996 1995 1996 1995 1996 1995
------------ ------------ ------------ ------------ ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
Operations:
Net investment income ............... .$ 10,803,526 $ 8,150,142 $ 4,550,893 $ 4,516,976 $ 4,134,213 $ 5,231,872
Net realized gain (loss) on securities
(note 8) ........................... 390,740 (474,237) 11,161 (2,775) 30,689 30,797
------------ ------------ ------------ ------------ ----------- -----------
Net increase in net assets resulting
from operations ..................... 11,194,266 7,675,905 4,562,054 4,514,201 4,164,902 5,262,669
------------ ------------ ------------ ------------ ----------- -----------
Distributions to shareholders:
Net investment income (note 1C) ...... (10,803,526) (8,150,142) (4,550,893) (4,516,976) (4,134,213) (5,231,872)
In excess of net investment income ... -- (11,680) -- -- -- --
Net realized gain on securities ...... (55,898) -- -- -- (30,689) (30,797)
------------ ------------ ------------ ------------ ----------- -----------
TOTAL DISTRIBUTIONS PAID TO SHAREHOLDERS (10,859,424) (8,161,822) (4,550,893) (4,516,976) (4,164,902) (5,262,669)
------------ ------------ ------------ ------------ ----------- -----------
Net increase (decrease) in net assets
from capital share transactions
(note 3) ........................... 67,179,305 25,776,580 17,670,184 6,877,356 (4,072,838) (43,370,462)
------------ ------------ ------------ ------------ ----------- -----------
CONTRIBUTIONS BY AFFILIATE (NOTE 8) .... -- 262,913 -- -- -- --
------------ ------------ ------------ ------------ ----------- -----------
TOTAL INCREASE (DECREASE) IN NET ASSETS 67,514,147 25,553,576 17,681,345 6,874,581 (4,072,838) (43,370,462)
NET ASSETS
Beginning of period .................. 169,297,493 143,743,917 140,825,589 133,951,008 94,834,300 138,204,762
------------ ------------ ------------ ------------ ----------- -----------
End of period* ..................... ..$236,811,640 $169,297,493 $158,506,934 $140,825,589 $90,761,462 $94,834,300
============ ============ ============ ============ =========== ===========
</TABLE>
* Distributions in excess of net investment income for the Domestic Prime Money
Market Portfolio is (11,680) for October 31, 1996 and October 31, 1995 and
accumulated net investment income for the Tax Exempt Money Market Portfolio is
$3,430 for October 31, 1996 and October 31, 1995.
See accompanying notes to financial statements
14
<PAGE>
THE TREASURER'S FUND
NOTES TO FINANCIAL STATEMENTS
OCTOBER 31, 1996
1. The Treasurer's Fund, Inc. (the "Fund") is an open-end, diversified
management investment company registered under the Investment Company Act of
1940, as amended, (the "Act"). The Fund currently consists of six separately
managed portfolios: U.S. Treasury Money Market Portfolio, Domestic Prime
Money Market Portfolio, Global Money Market Portfolio, Tax Exempt Money
Market Portfolio, Limited Term Portfolio and Tax Exempt Limited Term
Portfolio (collectively, the "Portfolios"). Of these, the U.S. Treasury
Money Market Portfolio, the Domestic Prime Money Market Portfolio and the
Tax Exempt Money Market Portfolio have commenced operations. The following
is a summary of significant accounting policies consistently followed by the
Fund in preparation of its financial statements:
(A) The Domestic Prime Money Market Portfolio, the Tax Exempt Money
Market Portfolio and the U.S. Treasury Money Market Portfolio
value all portfolio securities by the amortized cost method
which approximates market value in accordance with Rule 2a-7
under the Investment Company Act of 1940, as amended.
(B) It is the Fund's policy to comply with the requirements of the
Internal Revenue Code (the "Code") applicable to regulated
investment companies and to distribute all of its "investment
company taxable income," as defined in the Code, and net capital
gains, if any, to its shareholders. Therefore, no Federal income
tax provision is required. The Fund intends to treat each
Portfolio as a separate entity taxable as a corporation for
Federal income tax purposes and to have each Portfolio qualify
and elect to be taxed as a "regulated investment company" under
Subchapter M of the Internal Revenue Code.
(C) Net investment income, including short-term capital gains, is
declared as dividends daily and paid monthly; however, if an
investor's shares are redeemed during a month, accrued but
unpaid dividends are paid with the redemption proceeds.
Dividends are payable to shareholders of record at the time of
declaration.
(D) Investment transactions are recorded on trade date. Identified
cost of investments sold is used for both financial statement
and Federal income tax purposes. Interest income, including the
amortization of discount or premium, is recorded as earned.
When-issued securities are recorded on the date on which the
priced transaction confirmation is issued.
(E) Certain administrative expenses are common to, and allocated
among, the Portfolios. Such allocations are made on the basis of
each Portfolio's average net assets or other criteria directly
affecting the expenses.
(F) Use of Estimates. Estimates and assumptions are required to be
made regarding assets, liabilities, and changes in net assets
resulting from operations when financial statements are
prepared. Changes in the economic environment, financial markets
and any other parameters used in determining these estimates
could cause actual results to differ from these amounts.
2. The Fund retains Gabelli-O'Connor Fixed Income Mutual Funds Management Co.
("Gabelli-O'Connor") to act as Investment Advisor and Furman Selz LLC
("Furman Selz" ) to act as Administrator for the Fund. Gabelli-O'Connor
supervises all aspects of the Fund's operations and provides investment
advice and portfolio management services to the Fund. Subject to the
supervision of the Fund's Board of Directors, the Advisor makes the Fund's
day-to-day investment decisions, arranges for the execution of portfolio
transactions and generally manages the Fund's investments. The Advisor also
provides supervisory personnel who are responsible for supervising the
performance of administrative services, accounting and related services,
net asset value and yield calculations, reports to and filings with
regulatory authorities and services relating to such functions. However,
the Administrator provides personnel to perform the operational components
of such services.
Pursuant to the Administrative Services Agreement with each of the
Portfolios, Furman Selz provides all management and administrative services
necessary for the Fund, other than those provided by the Advisor, subject
to the supervision of the Fund's Board of Directors.
15
<PAGE>
THE TREASURER'S FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
OCTOBER 31, 1996
As compensation for their respective services, Gabelli-O'Connor and Furman
Selz are entitled to monthly fees with respect to each Portfolio.
Gabelli-O'Connor earns fees at the following annualized rates:
------------------------------------------------------------------------
AVERAGE DAILY VALUE OF GABELLI-
NET ASSETS OF EACH PORTFOLIO O'CONNOR
------------------------------------------------------------------------
U.S. Treasury Money Market Portfolio 0.30%
Domestic Prime Money Market Portfolio 0.30%
Money Market Plus Portfolio 0.30%
Tax Exempt Money Market Portfolio 0.30%
Limited Term Portfolio 0.45%
Tax Exempt Limited Term Portfolio 0.45%
------------------------------------------------------------------------
For the services rendered to the Fund by the Administrator, the Fund pays
the Administrator a fee, computed daily and payable monthly, in accordance
with the following schedule: (i) 0.10% of the first $500 million of
aggregate average daily net assets of the Fund, (ii) 0.065% of the next $250
million of aggregate average daily net assets of the Fund, (iii) 0.055% of
the next $250 million of aggregate average daily net assets of the Fund, and
(iv) 0.050% of all aggregate average daily net assets of the Fund over $1
billion.
The Administrator also provides the Fund with all accounting related
services. For the fund accounting services provided, the Administrator is
paid a fee of $2,500 plus out of pocket expenses per Portfolio per month.
For the year ended October 31, 1996, Gabelli-O'Connor was entitled to fees
of $657,103, $455,634 and $263,957 from the Domestic Prime Money Market
Portfolio, the Tax Exempt Money Market Portfolio and the U.S. Treasury Money
Market Portfolio, respectively. For fund accounting and administrative
servicing fees during this period, Furman Selz received $31,589 and
$218,993, respectively, from the Domestic Prime Money Market Portfolio,
$37,463 and $151,851, respectively, from the Tax Exempt Money Market
Portfolio and $31,122 and $87,971, respectively, from the U.S. Treasury
Money Market Portfolio.
Furman Selz acts as the Fund's transfer and dividend disbursing agent. The
Fund compensates Furman Selz for providing personnel and facilities to
perform transfer agency related services for the Fund at a rate intended not
to exceed the cost of providing such services. During the year ended October
31, 1996, Furman Selz was entitled to and voluntarily waived fees of $20,122
for the Domestic Prime Money Market Portfolio, $7,713 for the Tax Exempt
Money Market Portfolio and $5,202 for the U.S. Treasury Money Market
Portfolio.
The Fund has adopted a distribution and service plan (the "Plan" ) pursuant
to Rule 12b-1 under the Investment Company Act of 1940 for each Portfolio of
the Fund. There are no fees or expenses chargeable to the Fund under the
Plan and the Fund's Board of Directors has adopted the Plan in case certain
expenses of the Fund might be considered to constitute indirect payment by
the Fund of distribution expenses. GOC Fund Distributors, Inc. (the
"Distributor") serves as the exclusive Distributor of the shares of each
Portfolio pursuant to its Distribution Agreement with the Fund.
The Advisor has agreed to reimburse each Portfolio for its expenses
(exclusive of interest, taxes, brokerage, and extraordinary expenses) which
in any year exceed the lesser of (i) 1.50% of the Portfolio's average annual
net assets or (ii) the limits on investment company expenses prescribed by
any state in which the Portfolio's shares are qualified for sale. From time
to time, the Advisor may voluntarily assume certain expenses of any
Portfolio of the Fund as noted above. No such reimbursement was required
during the year ended October 31, 1996, for any of the Portfolios.
3. At October 31, 1996, there were twenty billion shares of capital stock,
having a par value of one tenth of one cent ($0.001) per share, authorized.
Each Portfolio has been allocated two billion shares of the authorized
capital stock. The balance of eight billion shares of capital stock may be
issued in an existing or newly created class by resolution of the Board of
Directors. Transactions in capital stock shares at $1.00 per share were as
follows:
16
<PAGE>
<TABLE>
<CAPTION>
THE TREASURER'S FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
OCTOBER 31, 1996
DOMESTIC PRIME TAX EXEMPT U.S. TREASURY
MONEY MARKET PORTFOLIO MONEY MARKET PORTFOLIO MONEY MARKET PORTFOLIO
-------------------------- --------------------------- -------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31,
1996 1995 1996 1995 1996 1995
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Sold ................................. 834,654,747 615,364,259 457,529,068 459,789,646 480,104,084 603,115,075
Issued in reinvestment of dividends .. 10,497,986 7,815,023 4,428,441 4,303,751 3,922,581 4,838,090
----------- ----------- ----------- ----------- ----------- -----------
845,152,733 623,179,282 461,957,509 464,093,397 484,026,665 607,953,165
Redeemed ............................. (777,973,428) (597,402,702) (444,287,325) (457,216,041) (488,099,503) (651,323,627)
----------- ----------- ----------- ----------- ----------- -----------
Increase (decrease) in shares ....... 67,179,305 25,776,580 17,670,184 6,877,356 (4,072,838) (43,370,462)
=========== =========== =========== =========== =========== ===========
</TABLE>
4. Each Portfolio may engage in repurchase agreements, with respect to any
security in which that Portfolio is authorized to invest, with member banks
of the Federal Reserve System and with broker-dealers who are recognized as
primary dealers in U.S. government securities by the Federal Reserve Bank
of New York whose creditworthiness has been reviewed and found satisfactory
by the Fund's Board of Directors. The Portfolios will always receive
securities as collateral whose market value, including accrued interest,
will be at least equal to 100% of the dollar amount invested by the
Portfolio in each agreement, and the Portfolio will make payment for such
securities only upon physical delivery or upon evidence of book entry
transfer to the account of the custodian. 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 Portfolios
maintain the right to sell the underlying securities at market value and
may claim any resulting loss against the seller.
5. In the pursuit of the Fund's minimum credit risk investment policy, each
Portfolio maintains a diversified portfolio of money market instruments,
each of which matures or resets to par in less than 397 days from date of
purchase and is determined to represent minimal credit risk in accordance
with the policies and procedures approved by the Fund's Directors. The
ability of the issuer of the instruments to meet their obligations may be
affected by economic developments in a specific industry, region or state.
6. The Fund may lend its securities to broker-dealers and other institutional
investors. The Fund's policy is to receive collateral on each loan equal at
all times to the market value of the securities loan plus accrued interest.
The Fund may bear the risk of delay in receiving additional collateral or
in recovering the securities loaned or even a loss of rights in the
collateral should the borrower of the securities fail financially. The Fund
receives compensation for lending its securities in the form of fees or
through the reinvestment of collateral of any cash received as collateral.
The Fund also continues to receive interest on the securities loaned, and
any gain or loss in the market price of the securities loaned that may
occur during the term of the loan will be for the account of the Fund.
7. The Portfolios are permitted to enter into reverse repurchase agreements
for liquidity purposes or when it is able to purchase other securities
which will produce more income than the cost of the agreement. The
Portfolios may enter into reverse repurchase agreements only with those
member banks of the Federal Reserve System and broker-dealers who are
recognized as primary dealers in U.S. government securities by the Federal
Reserve Bank of New York and whose creditworthiness has been reviewed and
found satisfactory by the Fund's Board of Directors. When engaging in
reverse repurchase transactions, the Portfolios will maintain, in a
segregated account with its Custodian, securities equal in value to those
subject to the agreement.
8. During the year ended October 31, 1995, the Domestic Prime Money Market
Portfolio realized losses on the sale of certain securities. Pursuant to an
undertaking, losses in the amount of $262,913 were reimbursed to the Fund
by Gabelli-O'Connor.
9. At October 31, 1996, the Tax Exempt Money Market Portfolio had net capital
loss carryforwards for Federal income tax purposes of $53,141 with $2,775,
$1,391, $2,039, $7,802 and $39,134 expiring in 2003, 2002, 2001, 1998 and
1997, respectrively.
10. SUBSEQUENT EVENTS. Furman Selz has consummated an agreement with BISYS
Group, Inc. ("BISYS") whereby services currently provided to the Fund by
Furman Selz will be provided to the Fund by BISYS and certain of its
affiliates under new Administrative Services, Transfer Agency and Fund
Accounting Agreements between the Fund and BISYS.
17
<PAGE>
THE TREASURER'S 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 Portfolio's financial statements.
<TABLE>
<CAPTION>
DOMESTIC PRIME
MONEY MARKET PORTFOLIO
----------------------------------------------------------------------------
YEAR ENDED
----------------------------------------------------------------------------
OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31,
1996 1995 1994 1993 1992
--------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value, beginning of year ........ $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
-------- -------- -------- -------- --------
Investment Operations:
Investment income--net .................... 0.049 0.054 0.035 0.028 0.038
Net realized gain (loss)
on investments........................... -- (0.002) -- -- --
-------- -------- -------- -------- --------
Total from Investment Operations......... 0.049 0.052 0.035 0.028 0.038
-------- -------- -------- -------- --------
Dividends from investment
income--net ............................. (0.049) (0.054) (0.035) (0.028) (0.038)
Dividends from net realized
gain on investments...................... -- -- -- -- --
-------- -------- -------- -------- --------
Total Distributions ..................... (0.049) (0.054) (0.035) (0.028) (0.038)
-------- -------- -------- -------- --------
Contributions from affiliate (note 8)...... -- 0.002 -- -- --
-------- -------- -------- -------- --------
Net asset value, end of year............... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
======== ======== ======== ======== ========
Total Investment Return...................... 5.12% 5.50% 3.56% 2.90% 3.82%
Ratios/Supplemental Data:
Ratio of expenses
to average net assets.................... 0.53%* 0.52%* 0.54% 0.62% 0.54%
Ratio of interest expense to
average net assets....................... 0.01% 0.02% 0.13% -- --
Ratio of net investment income to
average net assets ...................... 4.93% 5.33% 3.49% 2.82% 3.82%
Decrease reflected in above expense
ratios due to undertakings by the
Advisor/Administrator ................... 0.01% 0.01% 0.01% -- 0.01%
Net Assets, end of
year (in thousands)...................... $236,812 $169,297 $143,744 $145,021 $169,357
</TABLE>
- -----------------------
* Effective 1995, the ratios do not include a reduction of expenses for
custodian fee credits on cash balances maintained with the custodian.
Including such custodian fee credits, the expense ratios would have been
0.52% and 0.50% for the fiscal years ended October 31, 1996 and October 31,
1995, respectively.
See accompanying notes to financial statements
18
<PAGE>
THE TREASURER'S 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 Portfolio's financial statements.
<TABLE>
<CAPTION>
TAX EXEMPT
MONEY MARKET PORTFOLIO
-----------------------------------------------------------------------------------
YEAR ENDED
-----------------------------------------------------------------------------------
OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31,
1996 1995 1994 1993 1992
---------- ----------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value, beginning of year....... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
------- ------- ------- ------- -------
Investment Operations:
Investment income--net................... 0.030 0.034 0.022 0.021 0.031
Net realized gain (loss)
on investments......................... -- -- -- -- --
------- ------- ------- ------- -------
Total from Investment Operations ...... 0.030 0.034 0.022 0.021 0.031
------- ------- ------- ------- -------
Distributions:
Dividends from investment
income--net............................ (0.030) (0.034) (0.022) (0.021) (0.031)
------- ------- ------- ------- -------
Total Distributions.................... (0.030) (0.034) (0.022) (0.021) (0.031)
------- ------- ------- ------- -------
Net asset value, end of year ............ $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
======= ======= ======= ======= =======
Total Investment Return ................... 3.04% 3.42% 2.21% 2.16% 3.19%
Ratios/Supplemental Data:
Ratio of expenses to
average net assets..................... 0.54%* 0.52%* 0.53% 0.57% 0.58%
Ratio of net investment income to
average net assets..................... 3.00% 3.35% 2.18% 2.15% 3.10%
Decrease reflected in above expense
ratios due to undertakings by the
Advisor/Administrator.................. -- 0.01% 0.01% -- 0.02%
Net Assets, end of year
(in thousands) ........................ $158,507 $140,826 $133,951 $117,751 $95,751
- ----------
*Effective 1995, the ratios do not include a reduction of expenses for custodian
fee credits on cash balances maintained with the custodian. Including such
custodian fee credits, the expense ratios would have been 0.52% and 0.50% for
the fiscal years ended October 31, 1996 and October 31, 1995, respectively.
</TABLE>
19
<PAGE>
THE TREASURER'S 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 Portfolio's financial statements.
<TABLE>
<CAPTION>
U.S. TREASURY
MONEY MARKET PORTFOLIO
---------------------------------------------------------------------------------
YEAR ENDED
---------------------------------------------------------------------------------
OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31,
1996 1995 1994 1993 1992
--------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value, beginning of year......... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
------ ------ ------ ------ ------
Investment Operations:
Investment income--net .................... 0.047 0.051 0.033 0.026 0.034
Net realized gain (loss)
on investments........................... -- -- -- -- 0.002
------ ------ ------ ------ ------
Total from Investment Operations......... 0.047 0.051 0.033 0.026 0.036
------ ------ ------ ------ ------
Distributions:
Dividends from
investment income--net................... (0.047) (0.051) (0.033) (0.026) (0.034)
Dividends from net realized
gain on investments...................... -- -- -- -- (0.002)
------ ------ ------ ------ ------
Total Distributions ..................... (0.047) (0.051) (0.033) (0.026) (0.036)
------ ------ ------ ------ ------
Net asset value, end of year .............. $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
====== ====== ====== ====== ======
Total Investment Return ..................... 4.83% 5.27% 3.31% 2.60% 3.68%
Ratios/Supplemental Data:
Ratio of expenses to average
net assets............................... 0.63%* 0.56%* 0.49% 0.47% 0.45%
Ratio of net investment income
to average net assets .................. 4.70% 5.10% 3.07% 2.55% 3.38%
Decrease reflected in above expense
ratios due to undertakings by the
Advisor/Administrator.................... -- -- -- -- 0.01%
Net Assets, end of
year (in thousands)...................... $90,761 $94,834 $138,205 $224,071 $254,899
- ----------
*Effective 1995, the ratios do not include a reduction of expenses for custodian
fee credits on cash balances maintained with the custodian. Including such
custodian fee credits, the expense ratios would have been 0.60% and 0.54% for
the fiscal years ended October 31, 1996 and October 31, 1995, respectively.
</TABLE>
See accompanying notes to financial statements
- --------------------------------------------------------------------------------
FEDERAL TAX STATUS OF DIVIDENDS (UNAUDITED)
This information is provided to you to meet regulatory requirements and no
current action on your part is needed.
For the fiscal year ended October 31, 1996, dividends paid to you in cash or
reinvested in the amount of $0.049 per share for Domestic Prime Money Market
Portfolio are taxable as ordinary dividend income. None of this amount qualifies
for the dividend received deduction available to corporations. 11.2% of the
income was derived from obligations of the U.S. Treasury.
For the fiscal year October 31, 1996, dividends in the amont of $ 0.030 per
share for the Tax Exempt Money Market Portfolio are exempt from Federal
taxation. They may not be exempt from state or local taxation. You should
contact your tax adviser as to the state and local status of the dividend you
have received.
For the fiscal year ended October 31, 1996, dividends paid to you in cash or
reinvested in the amount of $0.047 per share for the U.S. Treasury Money Market
Portfolio are taxable as ordinary dividend income. None of this amount qualifies
for the dividend received deduction available to corporations. 52.4% of the
income was derived from obligations of the U.S. Treasury.
20
<PAGE>
REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
Shareholders and Board of Directors
The Treasurer's Fund, Inc.
We have audited the accompanying statements of assets and liabilities,
including the portfolios of investments, of The Treasurer's Fund, Inc.
(comprising the Domestic Prime Money Market, Tax Exempt Money Market, and U.S.
Treasury Money Market Portfolios) as of October 31, 1996, and the related
statements of operations for the year then ended, the statements of changes in
net assets for each of the two years in the period then ended, and the financial
highlights for each of the periods 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
October 31, 1996 by correspondence with the custodian and others. 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
each of the respective portfolios constituting The Treasure's Fund, Inc. at
October 31, 1996, the results of their operations for the year then ended, the
changes in their net assets for each of the two years in the period then ended,
and the financial highlights for each of the indicated periods, in conformity
with generally accepted accounting principles.
/s/Ernst & Young LLP
New York, New York
December 11, 1996
<PAGE>
THE TREASURER'S FUND
BOARD OF DIRECTORS
THOMAS E. O'CONNOR* Chairman of the Board
FELIX J. CHRISTIANA (Retired) Senior Vice President,
Dollar Dry Dock Savings Bank
MARY E. HAUCK (Retired) Senior Portfolio Manager,
Gabelli-O'Connor Fixed Income
Mutual Funds Management Co.
ROBERT C. KOLODNY, M.D. Physician, author and lecturer, General
Partner of KBS Partnership
WILLIAM A. MERRITT Financial Consultant/Mergers &
Acquisitions
ANTHONY R. PUSTORINO Certified Public Accountant; Professor,
Pace University
GARY L. ROUBOS Chairman of Dover Corp.
* "Interested person" as that term is defined in the
Investment Company Act of 1940.
- --------------------------------------------------------------------------------
OFFICERS
THOMAS E. O'CONNOR Chairman of the Board
RONALD S. EAKER President and Chief Investment Officer
HENLEY L. SMITH Vice President and Investment Officer
CARROLL L. COWARD Vice President and Investment Officer
JUDITH A. FABRIZI Secretary, Treasurer and
Investment Officer
JOHN J. PILEGGI Assistant Treasurer
JOAN V. FIORE Assistant Secretary
SHERYL HIRSCHFELD Assistant Secretary
